Source: http://www.epa.gov/OUST/fedlaws/jun1394.htm
Timestamp: 2015-04-27 16:10:51
Document Index: 174438116

Matched Legal Cases: ['art 280', 'arts 280', 'art 280', 'art 280', 'art 280', 'art 281', 'art 280', 'art 280', 'art 280']

59 FR 30448-30466 Monday, June 13, 1994 Underground Storage Tanks--Lender Liability; Proposed Rule | Office of Underground Storage Tanks (OUST) | US EPA
59 FR 30448-30466 Monday, June 13, 1994 Underground Storage Tanks--Lender Liability; Proposed Rule
30448-30466 Federal Register/ Vol. 59, No. 112/ Monday, June 13, 1994/ Rules and Regulations
Underground Storage Tanks--Lender Liability; Proposed Rule
[FRL-4895-3]
RIN 2050-AD67
Underground Storage Tanks--Lender Liability
SUMMARY: The Environmental Protection Agency (EPA) is proposing this rule under the Resource Conservation and Recovery Act (RCRA), Subtitle I--Regulation of Underground Storage Tanks, 42 U.S.C. 6901 et seq., to limit the regulatory obligations of persons maintaining indicia of ownership in a petroleum underground storage tank (UST) or UST system primarily to protect a security interest. The rule is proposed in response to petitions received by the Agency in connection with the rulemaking related to lender liability under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), 42 U.S.C. 9601 et seq. (See 57 FR 18349).
The Agency is proposing conditions under which certain security interest holders may be exempted from the RCRA Subtitle I corrective action, technical, and financial responsibility regulatory requirements that apply to an UST owner and operator. (See 40 CFR part 280.)
DATES: Written comments on this proposed rule must be submitted on or before August 12, 1994.
ADDRESSES: Written comments on today's proposal should be addressed to the docket clerk at the following address: U.S. Environmental Protection Agency, OUST Docket (5405), 401 M Street, SW., Washington, DC 20460. The Docket is located at 401 M Street, SW., Room 2616. One original and two copies of comments should be sent and identified by regulatory docket reference number UST 3-16. The docket is open from 9 a.m. to 4 p.m., Monday through Friday, excluding Federal holidays. Docket materials may be reviewed by appointment by calling (202) 260-
9720. Copies of docket materials may be made at a cost of $0.15 per page.
FOR FURTHER INFORMATION CONTACT: For further information about this proposal, contact the RCRA/Superfund Hotline, U.S. Environmental Protection Agency, Washington, DC. 20460, (800) 424-9346 (toll-free) or (703) 412-9810 (local). For the hearing impaired, the number is (300) 553-7672 (toll-free), or (703) 412-3323 (local). For technical information on this proposal, contact Shelley Fudge in the EPA Office of Underground Storage Tanks at (703) 308-8886.
SUPPLEMENTARY INFORMATION: The contents of today's proposed preamble are listed in the following outline:
II. Description of the UST Regulatory Program
A. UST Technical Standards
3. Release Reporting
5. Notification, Reporting, and Recordkeeping
B. Corrective Action Requirements
C. Financial Responsibility Requirements
D. State Program Approval Regulations
E. Scope of the UST Program
III. The UST Security Interest Exemption and Intent of Today's Proposed Rule
C. Liability of a Holder as an Owner of an Underground Storage Tank or Underground Storage Tank System
1. Petroleum Production, Refining, and Marketing
2. Indicia of Ownership
3. Primarily to Protect a Security Interest
4. ``Holder'' of Ownership Indicia
5. Participating in Management
D. Liability of a Holder as an Operator of an Underground Storage Tank or Underground Storage Tank System
1. Pre-Foreclosure Operation
2. Post-Foreclosure Operation
3. Lenders in Foreclosure Upon the Effective Date of the Rule
4. Release Reporting Requirements Following Foreclosure
E. Actions Taken to Protect Human Health and the Environment
IV. Financial Responsibility Requirements
V. State Program Approval
VI. Economic Analysis
EPA is proposing to establish regulatory criteria specifying which RCRA Subtitle I requirements are applicable to a secured creditor. Section 9003(h)(9) of RCRA exempts from the definition of ``owner,'' for purposes of section 9003(h)--EPA Response Program for Petroleum, those persons who, without participating in the management of the UST or UST system, and who are not otherwise engaged in petroleum production, refining, and marketing, maintain indicia of ownership in an UST or UST system primarily to protect a security interest. Those most affected by this ``security interest exemption'' include private lending institutions or other persons that guarantee loans secured by real estate containing an UST or UST system, or that acquire title to, or other indicia of ownership in, a contaminated UST or UST system.\1\ However, the security interest exemption is not limited solely to lending institutions; it potentially applies to any person whose indicia of ownership in an UST or UST system is maintained primarily to protect a security interest.
\1\Under the laws of some states, an interest in real property may include an interest in USTs or UST systems located on that property. See Sunnybrook Realty Co. Inc. v. State of New York, Kesbec, Inc. v. State of New York, Claim Nos. 32844, 33125, 15 Misc. 2d 739; 182 N.Y.S. 2d 983. Of course, the loan documents may specifically include or exclude USTs as collateral securing the obligation.
The RCRA subtitle I security interest exemption not only affects secured creditors but also UST and UST system owners who seek capital through the private lending market. Today's proposed rule will provide a regulatory exemption from corrective action regulatory requirements for those persons who provide secured financing to UST and UST system owners. EPA expects this rule, in conjunction with the statutory exemption in section section 9003(h)(9), to encourage the extension of credit to credit-worthy UST owners. At present, EPA believes that concerns over environmental liability are making a significant number of lenders reluctant to make loans to otherwise credit-worthy owners and operators of USTs. The free flow of credit to UST owners (many of whom are small entities that may rely on secured financing mechanisms for capital) is expected to assist UST owners in meeting their obligations to upgrade, maintain, or otherwise comply with RCRA subtitle I and other environmental requirements. Conversely, the lack of such capital may adversely affect the ability of an UST owner to meet its obligations under Subtitle I, with concomitant adverse environmental impacts from USTs and UST systems that are out of compliance due to the lack of financing for the UST owner and operator. (For a more detailed discussion, please refer to the Regulatory Background Document for this proposed rule, located in the OUST Docket at 401 M Street, SW., room 2616, Washington, DC 20460.)
The Agency is also concerned that if otherwise credit-worthy UST owners and operators are unable to obtain financing to perform leak detection tests, or to upgrade or replace deficient tanks, the market for UST equipment could be adversely affected, thereby limiting the availability and/or affecting the cost of such equipment. In addition, a lack of adequate capital could produce a ripple effect which would cut across other portions of the UST-related industrial sector. Based on letters received from UST equipment manufacturers, EPA believes that this sector has suffered as a direct result of the capital squeeze on UST owners and operators. The Agency is further concerned that many UST equipment manufacturers may find it increasingly difficult to sustain their production of UST equipment. Unnecessary constrictions on the free flow of capital for UST compliance and improvements could force companies to abandon their production of UST equipment or to close altogether, and it may have adverse impacts on the environment by making the investment or development of new UST technological innovations more difficult.
The preamble to this proposed rule is structured as follows: The following section briefly describes the UST program. This section is followed by a discussion of this proposed rule, which includes a description of the various options lenders may exercise both pre- and post-foreclosure with respect to regulatory compliance for a secured UST or UST system. Proposed regulatory text concludes this proposed rule.
Based on the Agency's study of the banking community's lending practices and discussions with representatives of both lenders and borrowers, EPA believes that the lending community in general is not particularly familiar with the UST statutory scheme and regulatory program. Because UST and UST systems are likely to be used as collateral in securing loans to borrowers, the Agency believes that it is appropriate and useful to briefly describe the UST program in the preamble of this proposed rule. The following discussion is general in nature and is intended to provide a framework for lenders or others to better understand the scope and intent of the program; it is not intended to be a substitute for the regulations themselves. Under the Hazardous and Solid Waste Amendments of 1984, Congress responded to the increasing threat to groundwater posed by leaking underground storage tanks by adding subtitle I to the Resource Conservation and Recovery Act. Subtitle I required EPA to develop a comprehensive regulatory program for USTs storing petroleum or hazardous substances. Congress directed the Agency to publish regulations that would require owners and operators of new tanks and tanks already in the ground to prevent and detect leaks, cleanup leaks, and demonstrate that they are financially capable of cleaning up leaks and compensating third parties for resulting damages.
EPA's UST regulations, 40 CFR parts 280 and 281, apply to any person who owns or operates an UST or UST system. The term ``owner'' is defined in the statute generally to mean any person who owns an UST used for the storage, use, or dispensing of substances regulated under subtitle I of RCRA (which includes both petroleum and hazardous substances) (section 9001(3), 42 U.S.C. 6991(3)). Owners are responsible for complying with the ``technical requirements,'' ``financial responsibility requirements,'' and ``corrective action requirements'' specified in the statute and regulations. These requirements are intended to ensure that USTs are managed and maintained safely, so that they will not leak or otherwise cause harm to human health and the environment. In addition, should a leak occur, the requirements provide that the owner is responsible for addressing the problem.
These same requirements apply to any person who ``operates'' an UST system. The term ``operator'' is very broad and means ``any person in control of, or having responsibility for, the daily operation of the underground storage tank'' (section 9001(4), 42 U.S.C. 6991(4)). As with owners, there may be more than one operator of a tank at a given time. Each owner and operator has obligations under the statute and regulations. In this respect, it is important to understand that a person may have obligations under subtitle I either as an owner or as an operator, or both.
The following subsections describe briefly each of the major components of the UST regulatory program applicable to persons who own or operate USTs and UST systems.
The technical standards of 40 CFR part 280 referred to here include: Subpart B--UST systems: Design, Construction, Installation, and Notification (including performance standards for new UST systems, upgrading of existing UST systems, and notification requirements); Subpart C--General Operating Requirements (including spill and overfill control, corrosion protection, reporting and recordkeeping); Subpart D--Release Detection; Sec. 280.50 (reporting of suspected releases) of Subpart E--Release Reporting, Investigation, and Confirmation; and Subpart G--Out of Service UST Systems (including temporary and permanent closure). These regulations impose obligations upon UST owners and operators, separate from the subtitle I corrective action requirements discussed in Section II. B of this preamble.
Before EPA regulations were issued, most tanks were constructed of bare steel and were not equipped with release prevention or detection features. 40 CFR 280.21 requires UST owners and operators to ensure that their tanks are protected against corrosion and equipped with devices that prevent spills and overfills no later than December 22, 1998. Tanks installed before December 22, 1988 must be replaced or upgraded by fitting them with corrosion protection and spill and overfill prevention devices to bring them up to new-tank standards. USTs installed after December 22, 1988 must be fiberglass-reinforced plastic, corrosion-protected steel, a composite of these materials, or determined by the implementing agency to be no less protective of human health and the environment and must be designed, constructed, and installed in accordance with a code of practice developed by a nationally recognized association or independent testing laboratory. Piping installed after December 22, 1988 generally must be protected against corrosion in accordance with a national code of practice. All owners and operators must also ensure that releases due to spilling or overfilling do not occur during product transfer and that all steel systems with corrosion protection are maintained, inspected, and tested in accordance with Sec. 280.31.
In addition to meeting the leak prevention requirements, owners and operators of USTs must use a method listed in Secs. 280.43 through 280.44 for detecting leaks from portions of both tanks and piping that routinely contain product. Deadlines for compliance with the leak detection requirements have been phased in based on the tank's age: The oldest tanks, which are most likely to leak, had the earliest compliance deadlines.
UST owners and operators must, in accordance with Sec. 280.50, report to the implementing agency within 24 hours, or another reasonable time period specified by the implementing agency, the discovery of any released regulated UST substances, or any suspected release. Unusual operating conditions or monitoring results indicating a release must also be reported to the implementing agency.
Owners or operators who would like to take tanks out of operation must either temporarily or permanently close them in accordance with 40 CFR part 280, subpart G--Out-of-Service UST Systems and Closure. When UST systems are temporarily closed, owners and operators must continue operation and maintenance of corrosion protection and, unless all USTs have been emptied, release detection. If temporarily closed for three months or more, the UST system's vent lines must be left open and functioning, and all other lines, pumps, manways, and ancillary equipment must be capped and secured. After 12 months, tanks that do not meet either the performance standards for new UST systems or the upgrading requirements (excluding spill and overfill device requirements) must be permanently closed, unless a site assessment is performed by the owner or operator and an extension is obtained from the implementing agency. To close a tank permanently, an owner or operator generally must: Notify the regulatory authority 30 days before closing (or another reasonable time period determined by the implementing agency); determine if the tank has leaked and, if so, take appropriate notification and corrective action; empty and clean the UST; and either remove the UST from the ground or leave it in the ground filled with an inert, solid material.
UST owners who bring an UST system into use after May 8, 1986 must notify state or local authorities of the existence of the UST and certify compliance with certain technical and other requirements, as specified in Sec. 280.22. Owners and operators must also notify the implementing agency at least 30 days (or another reasonable time period determined by the implementing agency) prior to the permanent closure of an UST. In addition, owners and operators must keep records of testing results for the cathodic protection system, if one is used; leak detection performance and upkeep; repairs; and site assessment results at permanent closure (which must be kept for at least three years).
Owners and operators of UST systems containing petroleum or hazardous substances must investigate, confirm, and respond to confirmed releases, as specified in Secs. 280.51 through 280.67. These requirements include, where appropriate: Performing a release investigation when a release is suspected or to determine if the UST system is the source of an off-site impact (investigation and confirmation steps include conducting tests to determine if a leak exists in the UST or UST system and conducting a site check if tests indicate that a leak does not exist but contamination is present); notifying the appropriate agencies of the release within a specified period of time; taking immediate action to prevent any further release (such as removing product from the UST system); containing and immediately cleaning up spills or overfills; monitoring and preventing the spread of contamination into the soil and/or groundwater; assembling detailed information about the site and the nature of the release; removing free product to the maximum extent practicable; investigating soil and groundwater contamination; and, in some cases, outlining and implementing a detailed corrective action plan for remediation.
The financial responsibility regulations (40 CFR part 280, subpart H) require that UST owners or operators demonstrate the ability to pay the costs of corrective action and to compensate third parties for injuries or damages resulting from the release of petroleum from USTs. The regulations require all owners or operators of petroleum USTs to maintain an annual aggregate of financial assurance of $1 million or $2 million, depending on the number of USTs owned. Financial assurance options available to owners and operators include: Purchasing commercial environmental impairment liability insurance; demonstrating self-insurance; obtaining guarantees, surety bonds, or letters of credit; placing the required amount into a trust fund administered by a third party; or relying on coverage provided by a state assurance fund.
Subtitle I of RCRA allows state UST programs approved by EPA to operate in lieu of the federal program. EPA's state program approval regulations under 40 CFR part 281 set standards for state programs to meet.
There are certain types or classes of tanks that are exempt from all or part of subtitle I's requirements. Specifically excluded by statute are: Farm and residential tanks of 1,100 gallons or less capacity used for storing motor fuel for noncommercial purposes; tanks used for storing heating oil for consumptive use on the premises where stored; tanks stored on or above the floor of underground areas (such as basements or tunnels); septic tanks; systems for collecting stormwater or wastewater; flow-through process tanks; emergency spill and overfill tanks that are expeditiously emptied after use; and tanks holding 110 gallons or less (42 U.S.C. 6991(1)).
In addition, and of particular importance to today's proposal, the statute excludes one type of potential ``owner'' from the corrective action requirements applicable to owners. Specifically, the statute excludes from the definition of owner any person ``who, without participating in the management of an UST, and otherwise not engaged in petroleum production, refining, and marketing, holds indicia of ownership primarily to protect the owner's security interest in the tank'' (RCRA section 9003(h)(9), 42 U.S.C. 6991b(h)(9)). This statutory provision is intended to exempt from cleanup responsibility a person whose only connection with a tank is as the holder of a security interest; i.e., a bank or other secured creditor who has extended credit to a borrower (commonly the tank's owner) and who has in return secured the loan or other obligation by taking a security interest in the tank. EPA has promulgated regulations governing corrective action under subtitle I. (See 40 CFR part 280, Secs. 280.51 through 280.67.) The regulation proposed today addresses the requirements of subtitle I that are applicable to a person who holds a security interest in a tank (a ``security holder'' or merely ``holder'') from the time that the person extends the credit up through and including foreclosure and re-
sale. As described in this proposed rule, a holder may face obligations either as an owner or as an operator, depending upon the specific activities undertaken by the holder.
The security interest exemption under subtitle I, section 9003(h)(9) of RCRA, 42 U.S.C. 6991b(h)(9), provides:
As used in this subsection, the term ``owner'' does not include any person who, without participating in the management of an underground storage tank and otherwise not engaged in petroleum production, refining, and marketing, holds indicia of ownership primarily to protect the owner's security interest in the tank.
Limited legislative history exists concerning the RCRA subtitle I security interest exemption. No guidance or other indication is available concerning the types of activities that Congress considered to be consistent with the subtitle I security interest exemption, or about the types of activities that Congress considered to be impermissible participation in an UST or UST system's management.
The statutory exemption is limited to liability for corrective action at petroleum-contaminated sites. Since the subtitle I security interest exemption applies only to the corrective action requirements for petroleum--Part 280 Subpart F and portions of subpart E, one interpretation of the statute could hold that the holder is not exempt from complying with other portions of the statute and regulations applicable to an ``owner'' of a tank. These other parts include 40 CFR part 280, subparts B, C, D, E (Sec. 280.50 only), and G (hereafter referred to as the ``UST technical standards'' for purposes of this rule), and Subpart H--Financial Responsibility. However, the statute is silent with respect to a holder's liability for these requirements solely as a consequence of having ownership rights in a tank primarily to protect a security interest. The Agency does not believe that these limited ownership rights rise to the level of full ``ownership'' sufficient to make the holder an ``owner'' of the tank, as that term is used in section 9001(3) of RCRA subtitle I. Therefore, EPA is proposing, under its broad rulemaking authority in section 9003, that a holder who meets the criteria specified in this proposed rule (i.e., whose only connection with the tank is as the bona fide holder of a security interest in the UST or UST system) is not subject to the UST technical standards and financial responsibility requirements otherwise applicable to a tank owner. EPA believes that this is both appropriate under the Agency's rulemaking authority and consistent with Congressional intent in providing the section 9003(h)(9) exemption for those persons who provide only financing to owners of a tank. Accordingly, a qualifying holder will not be required to comply with the full panoply of EPA regulations implementing subtitle I that apply to tank owners prior to or following foreclosure, provided that the requirements of today's proposed rule are satisfied.
With respect to a holder's potential to be an ``operator'' of a tank prior to foreclosure, consistent with the provisions of this proposed rule, the holder typically will not be involved in the day-to-
day operations of the tank, and will therefore not incur liability as an ``operator.''<SUP>2 By foreclosing, however, the holder takes affirmative action with respect to the tank and displaces the borrower; therefore, by necessity, the holder has taken ``control of . . . [and] responsibility for . . .'' the tank, and is therefore a tank operator under the definition at 42 U.S.C. 6991(4). However, under today's proposed rule, a foreclosing holder's responsibility for corrective action as an operator is limited in certain circumstances: In general, a holder's obligations would be limited under the provisions of this rule where the foreclosed-on tank is no longer storing petroleum, or where the holder itself empties the tank within a certain time period. In these circumstances, while a holder is an operator and therefore subject to the UST program's technical requirements and other obligations, a holder may remain exempt from the corrective action requirements and satisfy the technical requirements by exercising one of the options for compliance described in Section III. D. 2 of this preamble. These options allow a holder to satisfy its regulatory obligations as an ``operator'' by undertaking specified minimally burdensome and environmentally protective actions to secure and protect the UST or UST system. On the other hand, a holder who operates a tank by, for example, storing or dispensing product following foreclosure will be subject to the full range of requirements applicable to any person operating a tank (including corrective action requirements).
\2\Of course, a lender which has control of or responsibility for the daily operation of a tank would be an ``operator'' under section 9001(4), and therefore subject to all requirements applicable to an operator of a tank, including corrective action. Similarly, such acts may also constitute ``participation in the management'' of the tank, which would void the section 9003(h)(9) exemption and obligate the lender to comply with these same technical, financial, and corrective action requirements as an owner.
In developing today's proposal, EPA examined the potential obligations under subtitle I of government entities that act as conservators or receivers of assets acquired from failed lending and depository institutions, such as the Federal Deposit Insurance Corporation (FDIC) and Resolution Trust Corporation (RTC). Where a government entity or its designee is acting as a conservator or receiver, EPA interprets the security interest exemption in RCRA subtitle I section 9003(h)(9) to preclude the imposition of the insolvent estate's liabilities against the government entity acting as the conservator or receiver, and considers the liabilities of the institution being administered to be limited to the institution's assets. The situation of a conservator or receiver of a failed or insolvent lending institution is analogous to that of a trustee (particularly a trustee in bankruptcy) that is administering an insolvent's estate and, in accordance with those principles, the insolvent's liabilities are to be satisfied from the estate being administered and not from the assets of the conservator or receiver. Therefore, satisfaction of an estate's debts or liabilities would not reach the general assets of the FDIC, the RTC, those of any other government entity acting in a similar capacity, or those of a private person acting on behalf of the government conservator or receiver.
The legal basis for this proposed rule is the Agency's broad authority to issue regulations interpreting and implementing the provisions of RCRA subtitle I at issue in this proposal. Section 9003(b), 42 U.S.C. 6991b(b) provides EPA with authority to ``promulgate release detection, prevention, and correction regulations applicable to all owners and operators of underground storage tanks, as may be necessary to protect human health and the environment.''<SUP>3
\3\The recent decision by the U.S. Court of Appeals for the D.C. Circuit in Kelley, et al. v. EPA, No. 93-1312 (Feb. 4, 1994) does not apply to or affect the rule the Agency is proposing today. The Kelley decision vacated the Agency's rule on lender liability under CERCLA, which interpreted a statutory exemption under CERCLA which is similar to that under RCRA Subtitle I, because ``EPA lack[ed] statutory authority to restrict by regulation private rights of action arising under the statute. . .'' Kelley, slip op. at 3. As noted above, Sec. 9003 expressly confers upon EPA a broad rulemaking authority; to the extent that the grants of rulemaking authority were not sufficiently explicit under CERCLA, such is not the case under RCRA Subtitle I.
The Agency is proposing to define the regulatory terms under which a secured creditor may, consistent with the statutory exemption, avoid responsibility for corrective action as an owner and operator of an underground storage tank, as well as proposing an exemption from certain financial responsibility requirements. As discussed elsewhere in this preamble (See Section III.D), the statutory exemption from corrective action liability addresses only owners of underground storage tanks, while the statute and EPA's implementing regulations extend liability to both owners and operators. The Agency believes that without promulgating a rule under EPA's broad grant of rulemaking authority applying the protection found in the statutory security interest exemption to operators as well as owners, the statutory exemption may be rendered virtually meaningless, since an owner of an UST is also typically an UST operator. EPA does not believe that Congress, in creating section 9003(h)(9), intended for an otherwise exempt holder of a security interest to nonetheless fall subject to corrective action obligations as an operator. As such, EPA's exercise of its rulemaking authority in the proposed rule is appropriate and, perhaps, needed to fully effectuate the purpose of the statute.
In addition, the Agency has explicit rulemaking authority to, in its discretion, exempt certain classes of owners and operators from corrective action obligations (i.e., holders of security interests as described in this proposal). Section 9003(b) permits the Agency, in promulgating regulations under subtitle I, to make distinctions in its UST regulations between types or classes of tanks, based upon, inter alia, ``the technical capability of the owners and operators.'' Because security interest holders are typically not as a general matter engaged in the operation and maintenance of USTs (and thus do not possess the technical capacity of most UST owners and operators), EPA does not believe that requiring them to comply with highly detailed technical requirements is appropriate where requiring them to do so is not necessary for protection of human health and the environment. Furthermore, the Agency believes an exemption from these regulatory requirements is appropriate in the context of this proposed rule, where an exemption will serve, albeit indirectly, to advance the goals of subtitle I by making credit more available and thus aiding in the implementation of tank upgrade requirements.
However, this authority is not open-ended, as section 9003(a) requires EPA to promulgate regulations that are protective of human health and the environment. Without compromising the level of protectiveness established by the UST program, EPA previously relied on its section 9003(b) authority when it excluded a group of owners and operators from RCRA subtitle I requirements in the final Financial Responsibility Rule (53 FR 43322, Oct. 26, 1988). (In relevant part, the preamble to the final Financial Responsibility Rule states: ``The Agency does not interpret the Congressional intent of subtitle I to preclude exempting any class of USTs from otherwise applicable requirements when the Agency has determined that such requirements are not necessary to protect human health or the environment.'') That rule exempted states and the federal government from the UST financial responsibility requirements since those entities were, as a class, able to satisfy the purpose of the financial responsibility requirements in the absence of regulation.
Similarly, for purposes of this proposal, EPA believes that it is reasonable, in light of the purposes behind this proposal, to exempt a holder from RCRA subtitle I corrective action requirements as an operator if its USTs are empty and secure (as would be required under today's proposal) or if the holder chooses to also engage in environmentally beneficial activities (as discussed in Section III. E of this preamble). Because of the requirements a holder must meet before enjoying this proposed exemption, EPA's UST regulations will satisfy the statutory requirement that they be protective of human health and the environment.
The following sections describe the key terms used in this proposed rule. For the most part, these are also terms used in the section 9003(h)(9) security interest exemption. This section specifies the activities that are not ``participating in the management'' of a tank and which a holder may under today's proposal, engage in consistent with subtitle I regulatory requirements.
``Production of petroleum'' includes, but is not limited to, activities involved in the production of crude oil or other forms of petroleum, as well as the production of petroleum products from purchased materials, either domestically or abroad. ``Refining'' includes the processes of cracking, distillation, separation, conversion, upgrading, and finishing of refined petroleum or petroleum products. ``Marketing'' includes the distribution, transfer, or sale of petroleum or petroleum products for wholesale or retail purposes. A holder who stores petroleum products in USTs for on-site consumption only, such as to provide heat to an office building or to refuel its own vehicles, is not considered to be engaged in petroleum production, refining, or marketing for the purposes of the UST regulatory program.
EPA is proposing that ``indicia of ownership'' means ownership or evidence of an ownership interest in a petroleum UST or UST system. EPA is not proposing to limit or qualify type, quality, or quantity of ownership indicia that may be held by a person for the purpose of the regulatory exemption. The nature of the ownership interest may vary according to the type of secured transaction and the nature of the holder's relationship (such as that of a guarantor or surety). Accordingly, indicia of ownership may be evidence of any ownership interest or right to an UST or UST system, such as a security interest, an interest in a security interest, or any other interest in an UST