Federal Reimbursement Available for UST Cleanups     October 24, 2001

Most Poyner & Spruill clients are well aware of the availability of State trust fund reimbursement for some of the expenses incurred by individual underground storage tank (UST) owners and operators in addressing the environmental consequences of petroleum leaks from their USTs. And the firm’s local government and developer clients should already be familiar with State "Brownfields" agreements to foster redevelopment that is hindered by the continued presence of chemical contamination that neither the developer nor local government would otherwise want to address.

A recent announcement by the United States Environmental Protection Agency, however, advised us of the availability of a federal pilot program for local government financial assistance to address petroleum product damage when it impedes or threatens to impede redevelopment. The extended deadline to apply for such "USTfields" pilot grants is November 19, 2001, but the State would like to see draft applications by the first of November.

Under the "USTfields" program, EPA will disburse $40 million in individual grants of up to $100,000 each to address petroleum contamination caused by leaking USTs. The funds will be awarded to partnerships between States and local governments and must be used to assess and clean up two or more UST sites. EPA is reportedly particularly interested in funding projects in which federal money will be "leveraged" with the participation of private developer funding.

In announcing the pilot program, EPA Administrator Christie Whitman emphasized that, like Brownfields, the new program would target areas where redevelopment is being retarded by difficult liability issues associated with historical contamination. Typically, the federal grants will support downtown revitalization efforts and other redevelopment of areas containing one or more former gasoline service stations or other former transportation facilities where the need to address the environmental damage associated with leaking USTs would otherwise discourage or prevent the redevelopment.

The environmental attorneys at Poyner & Spruill LLP stand ready to answer your questions about this new program and, should your opportunity for federal funding look favorable, help you partner with the State and to submit a USTfields application by the EPA deadline.

If you have any questions, please feel free to contact Rick Kane in the Charlotte office at 704.342.5303, in the Raleigh office at 919.783.1035 or by e-mail at trkane@poynerspruill.com.