Budgeting for underground storage tank removal

For a developer or a municipality involved in a land remediation project, finding an underground storage tank (UST) on the property can have various implications, including:

  • Risks of potential tank leakage.
  • Reduction in property valuation.
  • Increased project costs.

Environmental hazards associated with underground storage tanks call for adding contingencies to the project's budget to ensure proper tank removal and compliance with regulatory reporting requirements. Here's an overview of the UST removal process and budgeting it.

The process of removing an underground storage tank

Most underground storage tanks are made of bare steel that corrodes over time, resulting in leakage of residual fluids (petroleum or other hazardous substances). The contents can seep into the soil, contaminate groundwater and soil vapor, and pose a significant environmental liability. As a result, the removal process needs to comply with state and federal regulations and licensing requirements. A typical underground storage tank removal process includes the following steps:
  1. Notify state and local governments

    Once the nature and extent of the release have been confirmed, the owner or operator notifies state regulatory officials of the plan to remove the underground storage tank under required permits. The initial response focuses on protecting public health and the environment. Most governing agencies require a state inspector (i.e. fire marshal or Department or Natural Resources representative) to be on-site during tank removal. The inspector determines if the UST has leaked or released contamination to the environment.

  2. Hire a licensed UST contractor

    Some states mandate hiring a licensed contractor who will ensure the required permits are obtained and the UST removal is completed safely.

  3. Monitor vapors

    Even after years of sitting idle, USTs can still contain flammable products and harmful vapors. Before it’s removed, the UST will need to be purged through air reduction or introduction of inert gas to get rid of harmful vapors. The UST can be checked with a Combustible Gas Detector (CGD) used to measure the Lower Explosive Limit (LEL) of air inside. It’s also a good idea to monitor ambient air during UST removal with a Photo-Ionization Detector (PID), used to measure workers’ toxic gas exposure.

  4. Remove residual and clean the tank

    Remaining liquids in an underground storage tank are pumped out before excavating or removing. The residual liquids are usually removed with a pump or handheld dipping device, depending on volume and volatility. The liquid removed may be stored on-site in an appropriate container/tank prior to disposal. In some cases, the fluid still has value and can be recycled by certain disposal companies.

  5. Excavate the tank

    Your licensed UST contractor will use appropriately sized machinery and methods to remove the UST from the tank cavity. Typically, this involves a skilled excavator operator lifting the tank from the cavity with an attached chain (reverse of how the tank was installed). In other instances, the UST contractor may need to tear and pry at the tank to break the anchors before they can retrieve the UST. Concrete from remaining tank anchors and saddles should always be stockpiled in a proper storage area. Most states allow for some excavation of visually contaminated soils following tank removal. If contaminated soils are observed around the tank cavity, those soils should also be stockpiled in a storage area with proper containment.

  6. Decontaminate the tank

    Tank decontamination and cleaning are important steps before transport and disposal. The tank should be moved to a decontamination area for cleaning, where excess soil is removed from outside the tank before the tank and a final interior cleanup can occur with a pressure washer. It’s important to containerize the soil and residual cleaning liquids to prevent further release of contaminants to the environment.

  7. Remove and dispose of the tank and contaminated soil

    After removing the tank from the excavation, the flammable/explosive gas concentration is measured again. If LEL is less than 5%, the tank is considered gas-free and fit to send off-site for disposal and recycling.

    Any contaminated soils and residual liquids will need to be properly handled and disposed of. Typically, these materials will require some measure of waste profiling to determine appropriate disposal options. Tank cavities may be backfilled at this point.

  8. Collect confirmation samples

    Work with an environmental consultant to collect representative groundwater and soil samples from the tank cavity walls and floor. Confirmation data is typically required by leaking underground storage tank (LUST) programs to determine if residual contamination is present. Confirmation samples will need to be analyzed for indicator contaminants, depending on the contents of the UST (see your consultant).

    If a leak is identified by either the state inspector or through confirmation sample analysis, then additional soil and water sampling may be necessary to assess the extent of contamination resulting from the LUST.

The cost to clean a leaking underground storage tank site through such elaborate steps depends on the extent of contamination and the state's cleanup standards. More extensive soil or groundwater contamination increases removal costs, which can range from $20,000 to more than $1 million. The biggest barrier to budgeting for underground storage tank removal is the possibility of an unregistered tank buried on-site. These orphan tanks can easily delay or derail a project. However, developers and municipalities can mitigate surprises by conducting ground-penetrating radar surveys to identify USTs and other subsurface anomalies, like buried structures, before development begins.

Budgeting for underground storage tank removal

While budgeting for UST removal, developers and municipalities can pursue funding through federal and state financial assurance funds. The U.S. Environmental Protection Agency (EPA) allocated about $91 million in 2020 to the Underground Storage Tank program for preventing, detecting and cleaning up releases from federally regulated underground storage tanks. Around 90% of EPA's Leaking Underground Storage Tank Trust Fund supports implementing underground storage tank clean-up and prevention programs. The state financial assurance funds help developers and municipalities pay for cleaning up newly reported releases and ongoing cleanups.

Securing funding for UST removal and LUST cleanup requires extensive research, eligibility assessment and sometimes even grant and loan preparation and grant management. At Fehr Graham, we help communities secure local, state and federal funding to help safely remove USTs and restore contaminated sites. Our extensive funding knowledge and experience have helped secure more than $200 million for affected communities to get the job done.

To learn more about how Fehr Graham can help you with budgeting for underground storage tank removal, fill out the contact form or call us at 815.394.4700.