LLIMOS
POLLUTiON CONTROL BOARD
June
7,
1990
IN
THE MATTER
DF:
UST
UPDATE.
USEPA REGULATIONS
)
R90-3
(6/30/89 through 12/31/89)
)
Rulemaking
ADOPTED RULE.
FINAL ORDER.
OPINION
AND
ORDER
OF
THE
BOARD
(by J.
Anderson):
Pursuant to Section 22.4(d)
of
the Environmental
Protection Act
(Act),
the Board
is amending the UST underground
storage tank regulations
in
35 111.
Adm. Code 731.
Section 22.4
of the Act
governs adoption of
regulations establishing
the
RCRA/UST program in
Illinois.
Section
22.4(d) provides for quick
adoption of
regulations which
are “identical
in substance”
to
federal
regulations.
Section 22.4(d)
provides that Title
VII
of the Act
and Section
5
of the
Administrative Procedure Act
(APA)
shall
not apply.
Because this rulemaking
is
not subject
to Section
5 of the APA,
it
is
not
subject
to first
notice
or
to
second
notice
review by the Joint Committee
on Administrative Rules
(JCAR).
The
federal
UST rules
are found
at
40 CFR
280.
This rulemaking
updates Illinois’ UST rules
to correspond with
the following USEPA actions,
during the period June 30,
1989,
through December
31,
1989:
54
Fed. Reg.
47081
November
9,
1989
PUBLIC
COMMENT
The
Board
adopted
a
Proposed
Opinion
and
Order
or
March
8,
1990.
The
proposal
appeared
on March
23,
1990,
at
14
111.
Reg. 4406.
The Board
has
received
the
following
public
comment,
which
is
addressed
in
the
body
of
this
Opinion,
below.
PC
1
Administrative Code Division
In the Proposed Opinion,
the Board
requested
coniient
on
a number
of
specific issues.
The Board received
no response to these specific requests
for corment.
The Board
therefore assumes affirmation
of
its proposed
resolution
to each of these
issues.
HISTORY OF
UST RULES
The
UST rules
are contained
in
35 Ill. Adm. Code 731.
Thay were adopted
and dmended
as
follows:
R36-1
71
PCB 110, July
11,
1986;
10
Ill.
Reg.
13998,
August
22,
1936.
The Board
acknowledges
the contributions o~
Mo’-tor
F.
Dorothy
ar’d
Arr~E.
Manly
in
drafting
this
Dpini
on
and
Order.
ii
:~
-321
—2—
R86—28
75 PCB 306, February
5,
1987;
and
76
PCB 195, March
5,
1987;
11
111. Peg.
6017,
April
3,
1987.
Correction
at
77 PCB 235,
April
16,
1987;
11
Ill. Reg.
8684, May
1,
1987.
P88—27
April
27,
1989;
13
Ill. Peg.
9519,
effective June
12,
1989
(9/23/88 Technical Standards)
R89-4
July 27,
1989;
13
Ill.
Peg.
15010, effective September
12,
1989
(10/26/88 Financial Assurance Requirements)
P89—10
March
1,
1990;
14
Ill. Peg.
5797,
effective April
10,
1990
(10/27/88
—
6/30/89)
P89-19
Adopted
Rule
April
26,
1990
(UST
State
Fund)
P90—3
This
Docket
(7/1,’89
—
12/31/89)
On
April
27,
1989
the
Board
adopted
regulations
which
are
identical
in
substance to the mdjor
revisions to the USEPA UST rules which
appeared
at
53
Fed. Reg.
37194, September 23,
1988.
The Board
separated the
financial
responsibility
rules
from the September
23
rules
in order
to avoid
delaying
adoption of the
latter.
The
financial
responsibility
rules
(53 Fed. Peg.
43370,
10/26/88) were adopted
in P89-4.
Until
P88-27 the UST
rules were addressed in the RCRA update Dockets.
The Board
separated the September 23,
1988 rules
from the RCRA update process
because
of the
size and timing
of the rulemaking, ana because
of the
desirability
of developing
a separate mailing
list for persons
interested only
in
tanks.
The Board will
consider recombining the RCRA and
UST updates
after
initial
adoption of the
new program.
FIRE MARSHAL RULES
As
is discussed
in greater detail
below, the legislation requires that
both the Board
and Office
of the State Fire Marshal
adopt equivalents
of much
of the USEPA UST rules.
The Fire Marshal’s
rules
are contained
in
41 Iii.
Adn. Code 170,
along with preexisting
rules adopted
prior
to the USEPA
equivalent rules.
They were adopted, amended, corrected and objected to
in
the following
actions:
13
Iii.
Peg.
5669,
effective April
21,
1989 (Technical
Standards)
13 Ill. Reg.
7744,
effective May
9,
1989.
13
Ill. Peg.
8515,
effective May 19,
1989
(Financial Assurance)
13
Ill.
Reg.
8875,
effective May
19,
1989.
13
Ill. Reg.13288,
August
18,
1989.
13
Ill. Reg.13305,
August
18,
1989.
13
Ill. Reg.14992, effective September 11,
1989.
13 Ill. Reg.15126, September 22,
1989
14 111. Reg.
63, January
5,
1990
14
Iii. Reg.
5781, April
20,
1990
112—322
—3-
STATUTORY
AUTHORITY
The February
2,
1989 Opinion
in P88-27
included
a lengthy discussion
of
Section 22.4(d)
of the Act,
and
other provisions
of P.A. 85-861,
the statutory
basis
of the UST program.
The Board will
reference that discussion
here,
and
will only sun~arizeit
in this Opinion.
Section
22.4(d)
of the Act
requires the Board
to
adopt
regulations which
are
“identical
in
substance” with USEPA’s UST
regulations.
Ill.
Rev.
Stat.
1987,
ch.
127
1/2,
par. 154(b)(i)
requires the Office
of
the Illinois
State
Fire Narsh.~l to adopt
regulations which are also
to
be “identical
in
substance”1
to the
same USEPA UST regulations.
While
the Fire Marshal
is
to
adopt
regulations
only through “corrective action’,
the Board
is
to adopt the
entire set of
rules.
In P88—27 the Board
adopted
regulations
which,
among
other
things,
reflect the delineation
between
regulations
before
and after
“corrective action”.
The
financial
responsibility regulations bridge the corrective action
gap.
Operators are required
to provide
financia’
assurance ir~iaediately or
in
the
near future.
This will mainly
be
for tanks
which
are not
known
or
suspected to
be
leaking.
However,
if
a
tank leaks,
and the operator fails
to
take sufficient corrective action,
the financial
institutions will
pay funds
for corrective
action which will
be under
the direction
of the Agency.
Thus
the Fire Marshal
will
be
responsible for receiving the financial
assurance
documents, but
the Agency will
be the recipient
of any furds.
Ill. Rev.
Stat.
1987,
ch.
127 1/2,
par.
154(b)(ii)
allows
the Fire
Marshal
to adopt “additional
requirements”.
Section 22.4(d)
of the Act
allows
the Board,
upon receiving notice
of
such requirement,
to
adopt
further Board
requirements which
are “identical
in
substance”
to the
additional
Fire Marshal
requirements.
The R88-27
and P89—4
rules
followed the USEPA rules
closely.
The Board will
consider adopting “additional
requirements” following notice
from the Fire Marshal.
SUMMARY
OF CHANGES
The amendments
are all
derived from
54 Fed. Peg. 47081, November
9,
1989.
They concern details
of termination
of
insurance coverage.
Section 731.192
A definition
of “termination”
has
been added.
This applies
in
40 CFR
28O.97(b)(i)
and
(2), which
is incorporated
by
reference
in.
35 IH. Adm. Code
731.197(b).
Note that,
because
of
the
use of incorporation
by reference,
the
cross
references
do
not
have precise
counterparts
in. Board rules.
Section 731.197
The forms for insurance were also amended
at
54 Fed. Peg.
47081, November
9,
1989.
In P39-4,
the Board
incorporated these
forms
by
reference,
r~ither
than setting
them
forth
in
full.
The Fire Marshal’s Office will promulgate
forms
based
on the USEPA rules.
In
this Section the Board
has
updated
the
incorporation
by
reference
to
include
the
revisions.
I 12—323
-4-
Section 731.205
This Section
is
derived from 40 CFR 280.105, which was
also amended
at
54
Fed. Peg. 47081, November
9,
1989.
The existing rules
allow
an
insurer to
terminate
a policy on
60 days notice.
The amendments allow termination
on
10
days notice
in the
case of non-payment
or misrepresentation
by
the
insured.
The amendments also make the 60 day notice
requirement applicable
to
“state
funded assurance”.
Section 731.200
in P89-19 authorizes
the use of the
UST State Fund to meet the
financial
assurance requirements
of this Part.
The
Board
references Section
731.200 here,
and makes
the
60 day notice
requirement
applicable
to the
UST State
Fund.
However, this poses
other questions similar
to the
issues
raised
in the R89—19 Opinion.
The Board
solicited coninent,
but
recieved no response,
as
to whether the 60 day notice
requirement
is
consistent with
the statutes,
cited
in P89-19, which
establish the UST State
Fund.
The Board
therefore assumes affirmation
of
its
resolution
to
this
problem.
CONCLUSION
The
Board will
adopt the Sections set forth
below.
The Board will
not
file these Sections with
the Administrative Code Division until
June 26,
1990,
to allow time for post adoption cornent particularly by the
entities involved
in
the authorization process.
ORDER
The Board hereby adopts
the following Sections
as
35
Ill. Adm. Code
731.192,
731.197
and 731.205.
TITLE
35:
ENVIRONMENTAL PROTECTION
SUBTITLE
G:
WASTE
DISPOSAL
CHAPTER
I:
POLLUTION
CONTROL
BOARD
SUBCHAPTER
d:
L~DERGROUND INJECTION
CONTROL
AND UNDERGROUND STORAGE TANK PROGRAMS
PART 731
UNDERGROUND STORAGE
TANKS
SUBPART A:
PROGRAM SCOPE
AND INTERIM PROHIBITION
Secti on
731.101
Definitions
and
exemptions
(Repealed)
731.102
Interim prohibitions
(Repealed)
731.103
Notification Requirements
(Repealed)
731.110
Applicability
731.111
Interim Prohibition for Deferred Systems
731.112
Definitions
731.113
Incorporations by Reference
731.114
Implementing Agency
SUBPART
B:
UST SYSTEMS:
DESIGN, CONSTRUCTION, INSTALLATION AND NOTIFICATION
Secti on
731.120
Performance Standards
for New Systems
112 324
—5—
731.121
Upgrading
of
Existing
Systems
731.122
Notification. Requirements
SUBPART
C:
GENERAL OPERATING REQUIREMENTS
Section
731.130
Spill
and Overfill
Control
731.131
Operation and Maintenance
of Corrosion Protection
731.132
Compatibility
731.133
Repairs
Allowed
731.134
Reporting
and Recordkeeping
SUBPART
0:
RELEASE DETECTION
Section
731.140
General
Requirements
for
all Systems
731.141
Petroleum Systems
731.142
Hazardous Substance Systems
731.143
Tanks
731.144
Piping
731.145
Recordkeeping
SUBPART
E:
RELEASE REPORTING, INVESTIGATION
AND CONFIRMATION
Secti on
731.150
Reporting of Suspected Releases
731.151
Investigation due to Off—site Impacts
731.152
Release Investigation and Confirmation
731.153
Reporting and Cleanup
of
Spills and Overfills
SUBPART
F:
RELEASE RESPONSE
AND CORRECTIVE ACTION
Section
731.160
General
731.161
Initial Response
731.162
Initial Abatement Measures and Site Check
731.163
Initial
Site Characterization
731.164
Free Product Removal
731.165
Investigations
for Soil
and Groundwater Cleanup
731.166
Corrective
Action
Plan
731.167
Public Participation
SUBPART
G:
OUT-OF-SERVICE SYSTEMS AND CLOSURE
Section
731.170
Temporary Closure
731.171
Permanent
Closure
and
Changes-in-Service
731.172
Assessing
Site
at
Closure
or
Change-in-Service
731.173
Previously
Closed
Systems
731.174
Closure Records
SUBPART
H:
FINANCIAL RESPONSIBILITY
Section
731.190
Applicability
731.191
Compliance Dates
731.192
Definitions
731.193
Amount
and Scope
of Required Financial Responsibility
731.194
Allowable Mechanisms
and Combinations
731.195
Financial Test
of Self-insurance
112—325
-6—
731.196
Guarantee
731.197
Insurance or Risk Retention Group Coverage
731.198
Surety Bond
731.199
Letter
of Credit
731.200
UST State Fund
731.202
Trust
Fund
731.203
Standby
Trust
Fund
731.204
Substitution
of Mechanisms
731.205
Cancellation or Nonrenewal
by Provider
731.206
Reporting
731.207
Recordkeeping
731.208
Drawing
on Financial Assurance
731.209
Release from Financial Assurance Requirement
731.210
Bankruptcy
or
other
Incapacity
731.211
Replenishment
731.900
Incorporation by
reference
(Repealed)
731.901
Compliance
Date
(Repealed)
Appendix A
Notification Form
AUTHORITY:
Implementing
and authorized
by Ill. Rev.
Stat.
1988 Supp.,
ch.
111
1/2,
pars.
1022.4,
1022.13 and 1027,
as
amended
by P.A.
86—125 and
P.A.
86—
0958
(Sections 22.4(d)
and
27
of the Environmental
Protection Act;
and
22.13(d) of the Environmental
Protection Act,
as amended by
P.A. 86-125
and
P.A. 86—0958).
SOURCE:
Adopted
in
P86—i
at
10
111.
Reg.
14175,
effective
August
12,
1986;
amended
in R86—28
at
11
111. Peg.
6220, effective March
24,
1987;
amended
in
P88-27
at
13 111. Reg.
9519,
effective June
12,
1989;
amended
in R89—4
at
13
Ill. Peg.
15010, effective September
12,
1989;
amended
in R89-1O
at
14 Ill.
Reg.
5797,
effective April
10,
1990;
amended
in R89-19
at
14 ill. Peg.
effective
;
amended
in P90-3
at
14
Ill.
Reg.
effective
NOTE:
Capitalization denotes statutory
language.
SUBPART
H:
FINANCIAL
RESPONSIBILITY
Section
731.192
Definitions
When
used
in
this
Subpart,
the
following
terms
have
the
meanings
given
below:
“Accidental
release”
means
any
sudden
or
nonsudden
release
of
petroleum
from
an
underground
storage
tank
that
results
in
a
need
for
corrective
action
or
compensation
for
bodily
injury
or
property
damage
neither
expected
nor
intended
by
the
tank
owner
or
operator.
“Bodily
injury”
means
bodily
injury,
sickness
or
disease
sustained
by
a person, including death resulting from any
of these
at
any time.
However,
this
term
does
not
include
those
liabilities
which,
consistent
with
standard
insurance
industry
practices,
are
excluded
from
coverage
in
liability
insurance
policies
for
bodily
injury.
BOARD
NOTE:
Derived
from
40
CFR
280.92,
as
adopted
at
53
Fed.
Reg.
112—3 26
—-I—
43370,
October
26,
1988, modified
to insert the Insurance
Services
Office definition.
“Controlling
interest” means
direct ownership of
at
least
50 percent
of
the
voting
stock
of
another
entity.
“Director of the Implementing Agency”.
See Section
731.114.
“Environmental
damage” means
the injurious presence
in
or upon
land,
the
atmosphere
or any watercourse or body of water
of
solid,
liquid,
gaseous
or thermal
contaminants,
irritants or pollutants.
BOARD NOTE:
This term
is
used
in
the definition
of
“pollution
incident”.
“Financial
reporting year” means:
The latest consecutive twelve-month
period
for
which
any of
the
following
reports
used
to
support
a financial
test
is prepared:
A 10-K
report submitted
to the Securities Exchange
Comi ss ion;
An
annual
report
of tangible
net worth submitted to Dun and
Bradstreet;
or
Annual
reports submitted to the Energy Information
Administration or the Rural
Electrification Administration.
“Financial
reporting year” may thus comprise
a fiscal
or
a
calendar
year
period.
“Legal
defense
cost”
is
any
expense
that
an
owner
or
operator
or
provider of financial
assurance incurs
in defending against
claims
or
actions
brought,
By USEPA
or the State
to require
corrective action
or
to
recover
the
costs
of corrective action;
By
or on behalf
of
a third party
for bodily injury
or
property
damage
caused
by
an accidental
release; or
By any person
to enforce the terms
of
a financial
assurance
mechanism.
“Occurrence” means
an accident, including continuous
or
repeated
exposure
to conditions,
which
results
in
a
release from
an
underground
storage
tank.
BOARD 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”.
112—327
-8-
“Owner
or
operator”,
when
the
owner
or
operator
are
separate
persons,
refers
to the
person that
is
obtaining
or has obtained financial
assurance.
“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 petroleum marketers
or
to
the
public.
“Petroleum marketing
firms”
are
all
firms owning petroleum marketing
facilities.
Firms
owning other types
of
facilities with USTs
as well
as
petroleum marketing facilities
are considered
to
be petroleum
marketing firms.
“Pollution
incident” means
emission, discharge,
release or
escape
of
pollutants
into
or upon land,
the atmosphere
or any watercourse
or
body of water, provided
that such emission, discharge,
release
or
escape results
in
“environmental damage”.
The entirety
of any
such
emission, discharge,
release
or escape
shall
be deemed
to
be one
“pollution
incident”.
“Pollutants”
meanS
any
solid, liquid,
gaseous
or thermal
irritant
or contaminant,
including smoke,
vapor,
soot,
fumes,
acids,
alkalis, chemicals and waste.
“Waste”
includes
materials to
be
recycled, ~econditioned
or reclaimed.
The term
“pollution
incident”
includes
an
“accidental
release”
or
an
“occurrence”.
BOARD
NOTE:
This definition
is
used
in
the definition
of
“property
damage.
“Property
damage”
means
Physical
injury
to, destruction
of
or contamination of tangible
property, including all
resulting loss of use of that
property;
or
Loss
of
use
of tangible property that
is not physically
injured,
destroyed or contaminated, but
has been evacuated,
withdrawn
from use or
rendered
inaccessible
because
of
a
“pollution
incident”.
This term does 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
do
not
include
corrective
action
associated
with
releases
from
tanks
which
are
covered
by
the
policy.
BOARD NOTE:
Derived from 40 CFR 280.92,
as adopted
at
53 Fed.
Peg.
43370, October 26,
1988, modified
to insert
the Insurance Services
Office
definition.
“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
Section
731.195
through
112—
328
-9-
731.203,
including
a
guarantor,
insurer,
risk
retention
group,
surety
or
issuer
of
a
letter
of
credit.
“Substantial
business
relationship”
means
that
one
business
entity
has
an
ownership
onterest
in
another.
“Tangible
net
worth”
means
the
tangible
assets
that
remain
after
deducting
liabilities;
such
assets
do
not
include
intangibles
such
as
goodwill
and
rights
to
patents
or
royalties.
For
purposes
of
this
definition,
“assets”
means
all
existing
and
all
probable
future
economic
benefits
obtained
or
controlled
by
a
particular entity as
a
result
of past transactions.
“Termination”
under
Section 731.197(b)
means
only those changes that
could
result
in
a
gap
in
coverage
as
where
the
insured
has
not
obtained sustitute coverage or
has obtained substitute
coverage with
a different retroactive
date than the retroactive date of the
original
policy.
BOARD NOTE:
Derived from 40 CFR 280.92(o),
as
adopted
at
54 Fed.
Reg. 47081, November
9,
1989.
“Unit
of
local
government”
is
as defined
in
the Illinois Constitution
of
1970,
Art.
VII,
Section
1.
Source:
Amended
at
14
Ill.
Reg.
effective
Section
731.197
Insurance
or
Risk
Retention
Group
Coverage
a)
An owner
or operator may satisfy the requirements
of Section
731.193
by obtaining
liability
insurance that conforms to the requirements
of
this
Section
from
a
qualified
insurer
or
risk
retention
group.
Such
insurance
must
be
in
the
form
of
a
separate
insurance
policy
or
an
endorsement
to
an
existing insurance policy.
b)
Forms.
1)
The Board incorporates
by
reference 40 CFR 280.97(b) as adopted
at
53
Fed.
Reg.
43370,
October
26,
1988,
as
amended
at
54
Fed.
Peg.
47081, November 9,
1989.
This Section incorporates
no
future editions
or amendments.
2)
The
Fire
Marshal
shall
promulgate
forms
based
on
the
forms
in
40
CFR
280.97(b), with such changes
as are necessary under Illinois
1 aw.
3)
Each insurance policy must
be amended
by
an endorsement,
or
evidenced
by
a
certificate
of
insurance.
The
owner
or operator
shall
use
the
forms
specified
in
subsection
(b)(2),
if
available;
otherwise,
the
owner
or
operator
shall
use
the
forms
in
40 CFR 280.97(b),
except
that instuctions
in
brackets must
be
replaced with
the relevant information
and
the
brackets
deleted.
112—329
-10-
c)
Each insurance policy must
be
issued by
an insurer
or
a
risk
retention
group which
is
licensed by the Illinois Department
of
Insurance.
Source:
Amended
at
14 Ill. Peg.
effective
Section
731.205
Cancellation or Nonrenewal
by Provider
a)
Except
as
otherwise provided,
a provider of
financial
assurance may
cancel
or
fail
to
renew
an assurance mechanism by
sending
a
notice
of
termination
by certified
mail
to the
owner’
or operator.
1)
Termination
of
a guarantee,
a
surety bond or
a letter
of credit
must not occur
until
120 days after the date on which
the owner
or operator receives
the notice
of termination
as evidenced
by
the
return
receipt;
or
2)
Termination
of
insurance or
risk retention group coverage,
except for non-payment
or misrepresentation by
the insured,
or
coverage by the UST
State Fund under Section
731.200, must
not
occur until
60 days after the date
on which the owner
or
operator receives the
notice
of termination,
as evidenced by the
return receipt.
Termination for non—payment
of premium
or
misrepresentation
by the
insured must not occur
until
a minimum
of
10 days after the date on which
the owner
or operator
receives the notice
of termination,
as
evidenced by the
return
receipt.
b)
If
a
provider of financial
responsibility cancels
or fails
to renew
for reasons
other
than incapacity
of the provider
as
specified
in
Section
731.206,
the owner
or operator shall
obtain alternate
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 days after
receipt
of the notice
of
termination, the
owner
or operator
shall
notify the Fire Marshal
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 subject
to
the termination maintained
in accordance with Section
731.207(b).
Source:
Amended
at
14 Ill. Reg.
effective
IT
IS SO ORDERED
112—330
—11—
I, Dorothy
P4.
Guna,
Clerk
of
the Illinois Pollution Control
Board,
hereby
certify that the above Opinion and Order was adopted
on the
7~
day
of
~
,
1990,
by a vote of
7—O
Dorothy
P4. ,~nn,Clerk
Illinois Pàllution Control
Board
112—331