Bill Text: MI SB1081 | 2013-2014 | 97th Legislature | Introduced
Bill Title: Environmental protection; underground storage tanks; imposition of environmental protection regulatory fees; clarify. Amends secs. 21502, 21503, 21508 & 21509 of 1994 PA 451 (MCL 324.21502 et seq.).
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2014-09-24 - Reassigned To Committee On Finance [SB1081 Detail]
Download: Michigan-2013-SB1081-Introduced.html
SENATE BILL No. 1081
September 23, 2014, Introduced by Senator ROBERTSON and referred to the Committee on Natural Resources, Environment and Great Lakes.
A bill to amend 1994 PA 451, entitled
"Natural resources and environmental protection act,"
by amending sections 21502, 21503, 21508, and 21509 (MCL 324.21502,
324.21503, 324.21508, and 324.21509), sections 21502 and 21503 as
amended by 2012 PA 113 and section 21508 as amended by 2004 PA 390.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 21502. As used in this part:
(a) "Administrator" means the fund administrator provided for
in section 21513.
(b) "Approved claim" means a claim that is approved pursuant
to section 21515.
(c) "Authority" means the Michigan underground storage tank
financial assurance authority created in section 21523.
(d) "Board of directors" means the board of directors of the
authority.
(e) "Bond proceeds account" means the account or fund to which
proceeds of bonds or notes issued under this part have been
credited.
(f) "Bonds or notes" means the bonds, notes, commercial paper,
other obligations of indebtedness, or any combination of these,
issued by the authority pursuant to this part.
(g) "Bulk plant" means a refined petroleum storage and
distribution facility that is not a terminal and from which refined
petroleum may be withdrawn by a tank wagon, a transport truck, or a
marine vessel.
(h) "Bulk transfer" means a transfer of refined petroleum from
1 location to another by pipeline tender or marine delivery within
the bulk transfer/terminal system, including, but not limited to,
all of the following transfers:
(i) A marine vessel movement of refined petroleum from a
refinery or terminal to a terminal.
(ii) Pipeline movements of refined petroleum from a refinery or
terminal to a terminal.
(iii) Book transfers of refined petroleum within a terminal
between licensed suppliers before completion of removal across the
terminal rack.
(iv) Two-party exchanges between licensed suppliers.
(i) "Bulk transfer/terminal system" means the refined
petroleum distribution system consisting of refineries, pipelines,
terminals, and marine vessels. Refined petroleum in a refinery,
pipeline, terminal, or marine vessel transporting refined petroleum
to a refinery or terminal is in the bulk transfer/terminal system.
Refined petroleum in a fuel storage facility, including, but not
limited to, a bulk plant that is not part of a refinery or
terminal, in the fuel supply tank of any engine or motor vehicle,
in a marine vessel transporting refined petroleum to a fuel storage
facility that is not in the bulk transfer/terminal system, or in
any tank car, rail car, trailer, truck, or other equipment suitable
for ground transportation is not in the bulk transfer/terminal
system.
(j) (g)
"Claim" means the
submission by the owner or operator
or his or her representative of documentation on an application
requesting payment from the fund. A claim shall include, at a
minimum, a completed and signed claim form and the name, address,
telephone number, and federal tax identification number of the
owner or operator.
(k) (h)
"Class 1 site" means a
site posing the highest degree
of threat to the public and environment as determined by the
department, based on the classification system developed by the
department pursuant to section 21314a.
(l) (i)
"Class 2 site" means a
site posing the second highest
degree of threat to the public and environment as determined by the
department, based on the classification system developed by the
department pursuant to section 21314a.
(m) (j)
"Co-pay amount" means the
co-pay amount provided for
in section 21514.
(n) (k)
"Corrective action" means
the investigation,
assessment, cleanup, removal, containment, isolation, treatment, or
monitoring of regulated substances released into the environment or
the taking of such other actions as may be necessary to prevent,
minimize, or mitigate injury to the public health, safety, or
welfare, the environment, or natural resources.
(o) (l) "Department"
means the department of environmental
quality.
(p) (m)
"Eligible person" means
an owner or operator who meets
the eligibility requirements in section 21556 or 21557 and received
approval of his or her precertification application by the
department.
(q) "Excluded liquid" means that term as defined in 26 CFR
48.4081-1.
(r) "Export" means to obtain refined petroleum in this state
for sale or other distribution outside of this state. Refined
petroleum delivered outside of this state by or for the seller
constitutes an export by the seller, and refined petroleum
delivered outside of this state by or for the purchaser constitutes
an export by the purchaser.
(s) "Exporter" means a person who exports refined petroleum.
(t) (n)
"Financial responsibility
requirements" means the
financial responsibility for taking corrective action and for
compensating third parties for bodily injury and property damage
caused by a release from an underground storage tank system that
the owner or operator of an underground storage tank system must
demonstrate under part 211 and the rules promulgated under that
part.
(u) (o)
"Fund" means the Michigan
underground storage tank
financial assurance fund created in section 21506.
(v) (p)
"Heating oil" means
petroleum that is No. 1, No. 2,
No. 4—light, No. 4—heavy, No. 5—light, No. 5—heavy, and No. 6
technical grades of fuel oil; other residual fuel oils including
navy special fuel oil and bunker C; and other fuels when used as
substitutes for 1 of these fuel oils.
(w) (q)
"Indemnification" means
indemnification of an owner or
operator for a legally enforceable judgment entered against the
owner or operator by a third party, or a legally enforceable
settlement entered between the owner or operator and a third party,
compensating that third party for bodily injury or property damage,
or both, caused by an accidental release as those terms are defined
in R 29.2163 of the Michigan administrative code.
(x) (r)
"Location" means a
facility or parcel of property
where petroleum underground storage tank systems are registered
pursuant to part 211.
(y) (s)
"Operator" means a person
who was, at the time of
discovery of a release, in control of or responsible for the
operation of a petroleum underground storage tank system or a
person to whom an approved claim has been assigned or transferred.
(z) (t)
"Owner" means a person,
other than a regulated
financial institution, who, at the time of discovery of a release,
held a legal, equitable, or possessory interest of any kind in an
underground storage tank system or in the property on which an
underground storage tank system is located, including, but not
limited to, a trust, vendor, vendee, lessor, or lessee. Owner
includes a person to whom an approved claim is assigned or
transferred. Owner does not include a person or a regulated
financial institution who, without participating in the management
of an underground storage tank system and without being otherwise
engaged in petroleum production, refining, or marketing relating to
the underground storage tank system, is acting in a fiduciary
capacity or who holds indicia of ownership primarily to protect the
person's or the regulated financial institution's security interest
in the underground storage tank system or the property on which it
is located. This exclusion does not apply to a grantor,
beneficiary, remainderman, or other person who could directly or
indirectly benefit financially from the exclusion other than by the
receipt of payment for fees and expenses related to the
administration of a trust.
(aa) (u)
"Oxygenate" means an
organic compound containing
oxygen and having properties as a fuel that are compatible with
petroleum, including, but not limited to, ethanol, methanol, or
methyl tertiary butyl ether (MTBE).
Sec. 21503. As used in this part:
(a) "Payment voucher" means a form prepared by the department
that specifies payment authorization by the department to the
department of treasury.
(b) "Petroleum" means crude oil, crude oil fractions, and
refined petroleum fractions including gasoline, kerosene, heating
oils, and diesel fuels.
(c) "Petroleum underground storage tank system" means an
underground storage tank system used for the storage of petroleum.
(d) "Precertification application" means the application
submitted by an owner or operator seeking the department's
eligibility determination for reimbursement for the costs of
corrective action from the temporary reimbursement program.
(e) "Refined petroleum" means aviation gasoline, middle
distillates, jet fuel, kerosene, gasoline, residual oils, and any
oxygenates that have been blended with any of these. Refined
petroleum includes transmix. Refined petroleum does not include
excluded liquids.
(f) "Refined petroleum fund" means the refined petroleum fund
established under section 21506a.
(g) "Refined petroleum product cleanup initial program" means
the program established in section 21553.
(h) "Refined petroleum product cleanup program" means the
refined petroleum product cleanup program established by law.
(i) "Regulated financial institution" means a state or
nationally chartered bank, savings and loan association or savings
bank, credit union, or other state or federally chartered lending
institution or a regulated affiliate or regulated subsidiary of any
of these entities.
(j) "Regulatory fee" means the environmental protection
regulatory fee imposed under section 21508.
(k) "Release" means any spilling, leaking, emitting,
discharging, escaping, or leaching from a petroleum underground
storage tank system into groundwater, surface water, or subsurface
soils.
(l) "Site" means a location where a release has occurred or a
threat of a release exists from an underground storage tank system,
excluding any location where corrective action was completed which
satisfies the cleanup criteria for unrestricted residential use
under part 213.
(m) "Temporary reimbursement program" means the program
established in section 21554.
(n) "Terminal" means a refined petroleum storage and
distribution facility that meets all of the following requirements:
(i) Is registered as a qualified terminal by the internal
revenue service.
(ii) Is supplied by a pipeline or a marine vessel.
(iii) Has a rack from which refined petroleum may be removed.
(o) "Transmix" means the mixed product that results from the
buffer or interface of 2 different products in a pipeline shipment,
or a mixture of 2 different products within a refinery or terminal
that results in an off-grade mixture.
(p) (n)
"Underground storage tank
system" means an existing
tank or combination of tanks, including underground pipes connected
to the tank or tanks, which is or was used to contain an
accumulation of regulated substances, and is not currently being
used for any other purpose, and the volume of which, including the
volume of the underground pipes connected to the tank or tanks, is
10% or more beneath the surface of the ground. An underground
storage tank system includes an underground storage tank that is
properly closed in place pursuant to part 211 and rules promulgated
under that part. An underground storage tank system does not
include any of the following:
(i) A farm or residential tank of 1,100 gallons or less
capacity used for storing motor fuel for noncommercial purposes.
(ii) A tank used for storing heating oil for consumptive use on
the premises where the tank is located.
(iii) A septic tank.
(iv) A pipeline facility, including gathering lines regulated
under 49 USC 60101 to 60137.
(v) A surface impoundment, pit, pond, or lagoon.
(vi) A storm water or wastewater collection system.
(vii) A flow-through process tank.
(viii) A liquid trap or associated gathering lines directly
related to oil or gas production and gathering operations.
(ix) A storage tank situated in an underground area such as a
basement, cellar, mineworking, drift, shaft, or tunnel if the
storage tank is situated upon or above the surface of the floor.
(x) Any pipes connected to a tank described in subparagraphs
(i) to (ix).
(xi) An underground storage tank system holding hazardous
wastes listed or identified under 42 USC 6921 to 6939f, or a
mixture of such hazardous waste and other regulated substances.
(xii) A wastewater treatment tank system that is part of a
wastewater treatment facility regulated under 33 USC 1317(b) or 33
USC 1342.
(xiii) Equipment or machinery that contains regulated substances
for operational purposes such as hydraulic lift tanks and
electrical equipment tanks.
(xiv) An underground storage tank system with a capacity of 110
gallons or less.
(xv) An underground storage tank system that contains a de
minimis concentration of regulated substances.
(xvi) An emergency spill or overflow containment underground
storage tank system that is expeditiously emptied after use.
(xvii) A wastewater treatment tank system.
(xviii) An underground storage tank system containing
radioactive material that is regulated under the atomic energy act
of 1954, 42 USC 2011 to 2297h-13.
(xix) An underground storage tank system that is part of an
emergency generator system at nuclear power generation facilities
regulated by the nuclear regulatory commission under 10 CFR part
50.
(xx) Airport hydrant fuel distribution systems.
(xxi) Underground storage tank systems with field-constructed
tanks.
(q) (o)
"Work invoice" means an
original billing acceptable to
the administrator and signed by the owner or operator that includes
all of the following:
(i) The name, address, and federal tax identification number of
each contractor who performed work.
(ii) The name and social security number of each employee who
performed work.
(iii) A specific itemized list of the work performed by each
contractor and an itemized list of the cost of each of these items.
(iv) A statement that the owner or operator employed a
documented sealed competitive bidding process for any contract
award exceeding $5,000.00.
(v) If the owner or operator did not accept the lowest
responsive bid received, a specific reason why the lowest
responsive bid was not accepted.
(vi) Upon request of the administrator, a list of all bids
received.
(vii) Proof of payment of the co-pay amount. as
required under
section
21514.
Sec. 21508. (1) An environmental protection regulatory fee is
imposed on all refined petroleum products sold for resale in this
state or consumption in this state. The regulatory fee shall be
charged for capacity utilization of underground storage tanks
measured on a per gallon basis. The regulatory fee shall be charged
against all refined petroleum products sold for resale in this
state or consumption in this state so as to not exclude any
products that may be stored in an underground tank at any point
after the petroleum is refined. The regulatory fee shall be 7/8
cent per gallon for each gallon of refined petroleum sold for
resale in this state or consumption in this state, with the per
gallon charge being a direct measure of capacity utilization of an
underground storage tank system. The regulatory fee shall not be
imposed on refined petroleum products that are transferred within
the bulk transfer/terminal system. The regulatory fee shall not be
imposed on refined petroleum products that are exported from this
state.
(2) The department of treasury shall precollect regulatory
fees from persons who refine petroleum in this state for resale in
this state or consumption in this state and persons who import
refined petroleum into this state for resale in this state or
consumption in this state. The department of treasury shall collect
regulatory fees that can be collected at the same time as the sales
tax under section 6a of the general sales tax act, 1933 PA 167, MCL
205.56a, at that time. The remainder of the regulatory fees shall
be collected in the manner determined by the state treasurer.
(3) A public utility with more than 500,000 customers in this
state is exempt from any fee or assessment imposed under this part
if that fee or assessment is imposed on petroleum used by that
public utility for the generation of steam or electricity.
(4)
Beginning on the effective date of the 2004 amendatory act
that
amended this section, all All
regulatory fees collected
pursuant to this part shall be deposited into the refined petroleum
fund. created
in section 21506a.
(5) Consistent with the March 31, 1995 determination by the
state treasurer that revenue will not be sufficient to pay expected
expenditures, and consistent with the April 3, 1995 notice of the
fund administrator pursuant to subsection (6), funding is no longer
available under this part for new claims, work invoices, and
requests for indemnification received after 5 p.m. on June 29,
1995. Claims, work invoices, and requests for indemnification
received after 5 p.m. on June 29, 1995 are not eligible for funding
under this part. Work invoices and requests for indemnification
received prior to 5 p.m. on June 29, 1995 may be paid to the extent
money is available in the fund as provided in this part.
(6) If the state treasurer determines that fund revenues will
not be sufficient to pay expected expenditures from the fund, the
state treasurer shall notify the administrator, and 90 days after
this notification has been given the administrator shall not accept
any new work invoices or requests for indemnification. Upon
receiving this notification from the state treasurer, the
administrator shall notify by certified mail the owners and
operators of petroleum underground storage tank systems registered
under part 211 that funding under this part will no longer be
available for new claims after the 90-day period has expired.
However, work invoices and requests for indemnification that were
submitted to the administrator prior to or during this 90-day
period may be paid to the extent money is available in the fund as
provided in this part.
(7) The department of treasury may audit, enforce, collect,
and assess the fee imposed by this part in the same manner and
subject to the same requirements as revenues collected pursuant to
1941 PA 122, MCL 205.1 to 205.31.
Sec.
21509. (1) Notwithstanding any other provision in this
part, regulatory fees shall be calculated and paid upon gross or
metered gallons with respect to all "light" petroleum products.
With respect only to "heavy" petroleum products (No. 4, No. 5, No.
6 residual oils), regulatory fees shall be calculated and paid upon
net or temperature-corrected gallons.
(2)
Notwithstanding any other provision in this part, if a
person
receives refined petroleum products in this state for resale
in
this state or consumption in this state pursuant to a product
exchange
agreement, the department of treasury shall collect the
regulatory
fees from that person. As used in this subsection,
"product
exchange agreement" means an agreement between buyers and
sellers
of refined petroleum products in which refined petroleum
products
in bulk quantity are made available to a person solely in
consideration
of that person making available a like volume of
refined
petroleum products to the other party at some other
location.