SB-1260, As Passed Senate, June 29, 2006

 

 

 

 

 

 

 

 

 

 

 

 

HOUSE SUBSTITUTE FOR

 

SENATE BILL NO. 1260

 

 

 

 

 

 

 

 

 

 

 

 

     A bill to amend 1994 PA 451, entitled

 

"Natural resources and environmental protection act,"

 

by amending sections 21502, 21503, 21506a, and 21552 (MCL

 

324.21502, 324.21503, 324.21506a, and 324.21552), section 21502 as

 

amended and sections 21506a and 21552 as added by 2004 PA 390 and

 

section 21503 as amended by 1996 PA 181.

 

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) "Advisory board" means the temporary reimbursement program

 

advisory board established under section 21562.

 

     (c)  (b)  "Approved claim" means a claim that is approved

 

pursuant to section 21515.


 

     (d)  (c)  "Authority" means the Michigan underground storage

 

tank financial assurance authority created in section 21523.

 

     (e)  (d)  "Board" means the Michigan underground storage tank

 

financial assurance policy board created in section 21541.

 

     (f)  (e)  "Board of directors" means the board of directors of

 

the authority.

 

     (g)  (f)  "Bond proceeds account" means the account or fund to

 

which proceeds of bonds or notes issued under this part have been

 

credited.

 

     (h)  (g)  "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.

 

     (i)  (h)  "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 consultant retained by the owner or operator to carry

 

out responsibilities pursuant to part 213.

 

     (j) "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.

 

     (k) "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.


 

     (l)  (i)  "Consultant" means a person on the list of qualified

 

underground storage tank consultants prepared pursuant to section

 

21542.

 

     (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) "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)  (m)  "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.

 

     (r)  (n)  "Fund" means the Michigan underground storage tank

 

financial assurance fund created in section 21506.

 

     (s)  (o)  "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.

 

     (t)  (p)  "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.

 

     (u)  (q)  "Location" means a facility or parcel of property

 

where petroleum underground storage tank systems are registered

 

pursuant to part 211.

 

     (v)  (r)  "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.

 

     (w)  (s)  "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.

 

     (x)  (t)  "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)  (1)  "Payment voucher" means a form prepared by the

 

department that specifies payment authorization by the department

 

to the department of treasury.

 

     (b)  (2)  "Petroleum" means crude oil, crude oil fractions,

 

and refined petroleum fractions including gasoline, kerosene,

 

heating oils, and diesel fuels.

 

     (c)  (3)  "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)  (4)  "Refined petroleum" means aviation gasoline, middle

 

distillates, jet fuel, kerosene, gasoline, residual oils, and any

 

oxygenates that have been blended with any of these.

 

     (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 initial program and the program

 

based upon the recommendations of the petroleum cleanup advisory

 

council under section 21552(10).

 

     (i)  (5)  "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)  (6)  "Regulatory fee" means the environmental protection

 

regulatory fee imposed under section 21508.

 

     (k)  (7)  "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)  (8)  "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)  A farm or residential tank of 1,100 gallons or less

 

capacity used for storing motor fuel for noncommercial purposes.

 

     (ii)  (b)  A tank used for storing heating oil for consumptive

 

use on the premises where the tank is located.

 

     (iii)  (c)  A septic tank.

 

     (iv)  (d)  A pipeline facility, including gathering lines

 

regulated under either of the following:

 

     (A)  (i)  The natural gas pipeline safety act of 1968, Public

 

Law 90-481, 49  U.S.C.  USC Appx 1671 to 1677, 1679a to 1682, and

 

1683 to 1687.

 

     (B)  (ii)  Sections 201 to 215, 217, and 219 of the hazardous

 

liquid pipeline safety act of 1979, title II of the pipeline safety

 

act of 1979, Public Law 96-129, 49  U.S.C.  USC Appx 2001 to 2015.


 

     (v)  (e)  A surface impoundment, pit, pond, or lagoon.

 

     (vi)  (f)  A storm water or wastewater collection system.

 

     (vii)  (g)  A flow-through process tank.

 

     (viii)  (h)  A liquid trap or associated gathering lines

 

directly related to oil or gas production and gathering operations.

 

     (ix)  (i)  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)  (j)  Any pipes connected to a tank described in  

 

subdivisions (a) to (i)  subparagraphs (i) to (ix).

 

     (xi)  (k)  An underground storage tank system holding hazardous

 

wastes listed or identified under subtitle C of the solid waste

 

disposal act, title II of Public Law 89-272, 42  U.S.C.  USC 6921

 

to 6939e, or a mixture of such hazardous waste and other regulated

 

substances.

 

     (xii)  (l)  A wastewater treatment tank system that is part of a

 

wastewater treatment facility regulated under section 307(b) of

 

title III or section 402 of title IV of the federal water pollution

 

control act, 33  U.S.C.  USC 1317 and 1342.

 

     (xiii)  (m)  Equipment or machinery that contains regulated

 

substances for operational purposes such as hydraulic lift tanks

 

and electrical equipment tanks.

 

     (xiv)  (n)  An underground storage tank system with a capacity

 

of 110 gallons or less.

 

     (xv)  (o)  An underground storage tank system that contains a

 

de minimis concentration of regulated substances.

 

     (xvi)  (p)  An emergency spill or overflow containment


 

underground storage tank system that is expeditiously emptied after

 

use.

 

     (xvii)  (q)  A wastewater treatment tank system.

 

     (xviii)  (r)  An underground storage tank system containing

 

radioactive material that is regulated under the atomic energy act

 

of 1954, chapter 1073, 68 Stat. 919.

 

     (xix)  (s)  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  

 

C.F.R.  CFR part 50, appendix A to part 50 of title 10 of the code

 

of federal regulations.

 

     (xx)  (t)  Airport hydrant fuel distribution systems.

 

     (xxi)  (u)  Underground storage tank systems with field-

 

constructed tanks.

 

     (o)  (9)  "Work invoice" means an original billing acceptable

 

to the administrator and signed by the owner or operator and a

 

consultant that includes all of the following:

 

     (i)  (a)  The name, address, and federal tax identification

 

number of each contractor who performed work.

 

     (ii)  (b)  The name and social security number of each employee

 

who performed work.

 

     (iii)  (c)  A specific itemized list of the work performed by

 

each contractor and an itemized list of the cost of each of these

 

items.

 

     (iv)  (d)  A statement that the consultant employed a

 

documented sealed competitive bidding process for any contract

 

award exceeding $5,000.00.


 

     (v)  (e)  If the consultant did not accept the lowest

 

responsive bid received, a specific reason why the lowest

 

responsive bid was not accepted.

 

     (vi)  (f)  Upon request of the administrator, a list of all

 

bids received.

 

     (vii)  (g)  Proof of payment of the co-pay amount as required

 

under section 21514.

 

     Sec. 21506a. (1) The refined petroleum fund is created within

 

the state treasury.

 

     (2) The state treasurer may receive money or other assets from

 

any source for deposit into the refined petroleum fund. The state

 

treasurer shall direct the investment of the refined petroleum

 

fund. The state treasurer shall credit to the refined petroleum

 

fund interest and earnings from refined petroleum fund investments.

 

     (3) Money in the refined petroleum fund at the close of the

 

fiscal year shall remain in the refined petroleum fund and shall

 

not lapse to the general fund.

 

     (4) Money from the refined petroleum fund shall be expended,

 

upon appropriation, only for 1 or more of the following purposes:

 

     (a) For gasoline inspection programs under both of the

 

following:

 

     (i) The weights and measures act, 1964 PA 283, MCL 290.601 to

 

290.634.

 

     (ii) The motor fuels quality act, 1984 PA 44, MCL 290.641 to

 

290.650d.

 

     (b) Not more than $15,000,000.00 of the money transferred to

 

the refined petroleum fund pursuant to section 21506(6), for the


 

refined petroleum product cleanup initial program and for the

 

department's administrative costs associated with the temporary

 

reimbursement program.

 

     (c) Not more than $45,000,000.00 of the money transferred to

 

the refined petroleum fund pursuant to section 21506(6), for

 

implementation of the temporary reimbursement program.

 

     (d)  (b)  For corrective actions necessary to address releases

 

of refined petroleum products under a refined petroleum product

 

cleanup program established by law following the issuance of

 

recommendations from the refined petroleum cleanup advisory council

 

created in section 21552.

 

     (e)  (c)  For the reasonable administrative costs of the

 

department, the department of agriculture, the department of

 

attorney general, and the department of treasury in administering

 

the refined petroleum fund and in implementing the programs

 

receiving revenue from the refined petroleum fund.

 

     Sec. 21552. (1) The refined petroleum cleanup advisory council

 

is created.

 

     (2) The council shall consist of all of the following:

 

     (a) Two members appointed by the senate majority leader, 1 of

 

whom shall be a representative of the petroleum industry.

 

     (b) Two members appointed by the speaker of the house of

 

representatives, 1 of whom shall be a representative of the

 

petroleum industry.

 

     (c) Three members appointed by the governor, 1 of whom shall

 

be a representative of the petroleum industry.

 

     (3) The members first appointed to the council shall be


 

appointed not later than 60 days after the effective date of the

 

amendatory act that added this section.

 

     (4) Members of the council shall serve until a successor is

 

appointed.

 

     (5) If a vacancy occurs on the council, the unexpired term

 

shall be filled in the same manner as the original appointment was

 

made.

 

     (6) The first meeting of the council shall be called by the

 

director. At the first meeting, the council shall elect from among

 

its members a chairperson and other officers as it considers

 

necessary or appropriate. After the first meeting, the council

 

shall meet at least quarterly, or more frequently at the call of

 

the chairperson or if requested by 2 or more members.

 

     (7) Five of the members of the council constitute a quorum for

 

the transaction of business at a meeting of the council. An

 

affirmative vote of a majority of the members of the council is

 

required for official action of the council.

 

     (8) Members of the council shall serve without compensation.

 

However, members of the council may be reimbursed for their actual

 

and necessary expenses incurred in the performance of their

 

official duties as members of the council.

 

     (9) As soon as practical, but not later than 60 days after all

 

members of the council have been appointed under subsection (2),

 

the council shall make a recommendation to the governor and the

 

legislature on how the money transferred under section 21506(6),

 

less any amounts appropriated for the fiscal year ending September

 

30, 2004, should be expended.


 

     (10) By April 1, 2005, the council shall submit to the

 

governor and the legislature a report that does all of the

 

following:

 

     (a) Evaluates and makes recommendations for a refined

 

petroleum cleanup program that provides for corrective actions

 

necessary to address releases of refined petroleum products. The

 

recommended refined petroleum cleanup program shall be designed to

 

benefit owners and operators and to provide for corrective actions

 

at locations for which an owner or operator who is liable for

 

corrective actions has not been identified or is insolvent.

 

     (b) Makes recommendations on an appropriate limitation on

 

administrative costs under section  21506a(4)(c)  21506a(4)(e).

 

     (c) Makes recommendations to update obsolete provisions of

 

this part.

 

     (11) Effective 180 days after the council submits its report

 

under subsection (10), the council is dissolved.

 

     (12) This section is repealed  August 1  December 31, 2006.

 

     Enacting section 1. This amendatory act does not take effect

 

unless all of the following bills of the 93rd Legislature are

 

enacted into law:

 

     (a) House Bill No. 6047.

 

     (b) House Bill No. 6202.