SECTION 1. Sections 46-12.9-3, 46-12.9-4, 46-12.9-5, 46-12.9-7, 46-12.9-8 and 46-12.9-11 of the General Laws in Chapter 46-12.9 entitled "Rhode Island Underground Storage Tank Financial Responsibility Act" are hereby amended to read as follows:

46-12.9-3. Definitions. -- When used in this chapter:

(1) "Department" means the Rhode Island department of environmental management.

(2) "Director" means the director of the department of environmental management or his or her designee.

(3) "Eligible costs" means costs, expenses and other obligations as incurred by a responsible party for site investigation, site remediation or other corrective action activities ordered or directed by the department or voluntarily performed by the responsible party and not specifically identified by the review board as ineligible.

(4) "Fund" means the Rhode Island underground storage tank financial responsibility fund established herein.

(5) "Fund administrator" means the clean water finance agency established pursuant to the provisions of chapter 12.2 of title 46 or any other agency of state government designated by the governor.

(6) (5) "Operator" means any person in control of, or having the responsibility for, the daily operation of an underground storage tank system.

(7) (6) "Owner" means any agency or political subdivision of the state, any municipality, public or private corporation or authority, individual, trust, firm, joint stock company, partnership, association or other entity, and any officer, employee or agent thereof.

(8) (7) "Petroleum" means crude oil, crude oil fractions, and refined petroleum fractions, including gasoline, kerosene, heating oils, used/waste oil and diesel fuels.

(9) (8) "Release" means any leaking, emitting, discharging, escaping or leaching of petroleum from any underground storage tank or underground storage tank system into the environment.

(10) (9) "Responsible party" means the person or persons liable for release of petroleum or the remediation of a release.

(11) (10) "Review board" means the Rhode Island underground storage tank financial responsibility review board established pursuant to the provisions of section 46-12.9-8.

(12) (11) (i) "Site" means any location at which or from which there has been a release of petroleum associated with an underground storage tank or an underground storage tank system or any location to which such petroleum has migrated.

(ii) For the purposes of this chapter, "government site" means any location owned or occupied, or previously owned or occupied, by any city or town, the state or any agency of the state of which or from which there has been a release of petroleum associated with an underground storage tanker and underground storage tank system.

(13) (12) "Underground storage tank" means any one or combination of tanks, including underground pipes connected thereto, used to contain an accumulation of petroleum and the volume of which, including the volume of underground pipes connected thereto, is ten percent (10%) or more beneath the surface of the ground.

(14) (13) "Underground storage tank system" means an underground storage tank and its associated ancillary equipment and containment system, if any.

46-12.9-4. Petroleum cleanup fund. -- (a) There is hereby established the Rhode Island underground storage tank financial responsibility fund.

(b) The fund shall consist of any funds which the state may from time to time appropriate, as well as money received as gifts, grants, bequests, donations or other funds from any public or private sources or annual tank registration fees as established herein which are intended to serve the purposes of the Rhode Island underground tank financial responsibility fund and all funds collected pursuant to section 46-12.9-11.

(c) All funds received under the provisions of this chapter shall be paid to and received by the general treasurer of the state of Rhode Island, who the review board, which shall keep such monies in a distinct interest-bearing restricted receipt account to the credit of and for the exclusive use of the fund.

46-12.9-5. Purpose of fund. -- The purpose of the fund shall be to facilitate the clean-up of releases from leaking underground storage tanks, underground storage tank systems, including those located on sites or government sites in order to protect the environment including drinking water supplies and public health. The fund shall provide reimbursement to responsible parties for the eligible costs incurred by them as a result of releases of certain petroleum from underground storage tanks or underground storage tank systems as provided herein. Monies in the fund shall be dispensed only upon the order of the general treasurer review board or his or her its designee for the following purposes, and only after the approval of the review board: .

(1) Administrative expenses, personnel, expenses and miscellaneous costs directly related to the fund management incurred by the fund administrator and approved by the review board in carrying out fund activities; provided, however, that no more than five hundred and fifty thousand dollars ($550,000) shall be dispensed from the fund for administrative purposes during fiscal year 1998. For fiscal year 1999, no more than three hundred and fifty thousand dollars ($350,000) shall be dispensed from the fund for administrative purposes;

(2) The fund shall pay not more than one million dollars ($1,000,000) per incident and up to two million dollars ($2,000,000) in the aggregate for damages of eligible costs, as defined in regulations promulgated hereunder and, as further defined in section 46-12.9-3 excluding legal costs and expenses, incurred by a responsible party as a result of a release of petroleum from an underground storage tank or underground storage tank system; provided, however, that a responsible party shall be responsible for the first twenty thousand dollars ($20,000) of said eligible costs;

(3) [Deleted by P.L. 2001, ch. 328, section 1.]

(4) Reimbursement for any third party claim including, but not limited to, claims for bodily injury, property damage and damage to natural resources which are asserted against a responsible party and which have arisen as a result of a release of petroleum from an underground storage tank or underground storage tank system in an amount not to exceed one million dollars ($1,000,000) for each release as set forth in subsection (2) of this section; provided, that such claims are found by the review board to be justified, reasonable, related to the release of petroleum and not excessive or spurious in nature; and

(5) Eligible costs incurred by the department in carrying out the investigative, remedial and corrective action activities at sites of a petroleum release associated with an underground storage tank or underground storage tank system where the responsible party fails to comply with an order of the department to take such corrective action. In the event of such failure, the department may access the fund to perform the ordered work and shall proceed to recover from the responsible party on behalf of the fund any amount expended from the fund by the department.

(6) Nothing contained in this chapter shall be construed to prevent subrogation by the state of Rhode Island against any responsible party other than the owner and/or operator for all sums of money which the fund shall be obligated to pay hereunder plus reasonable attorneys' fees and costs of litigation and such right of subrogation is hereby created.

(7) [Deleted by P.L. 2001, ch. 328, section 1.]

46-12.9-7. Rules and regulations. -- The review board, after consultation with the general treasurer and the department, is hereby authorized to promulgate, implement and amend regulations, in accordance with the provisions of chapter 35 of title 42, providing for the submission of claims to the fund and the timely disbursement of monies from the fund. Such regulations shall include, but not be limited to, the following:

(1) A means of notifying all eligible parties of the existence and functioning of the fund;

(2) The record keeping required of eligible parties for submission to and reimbursement from the fund;

(3) A set criteria which establishes the eligibility for reimbursement of specific costs, expenses and other obligations;

(4) [Deleted by P.L. 2001, ch. 328, section 1.]

(5) A method of providing periodic reimbursement for eligible costs incurred by an eligible party after July 8, 1994;

(6) A requirement that the review board render its decisions to an eligible party upon the receipt of a complete claim for reimbursement within ninety (90) days following its receipt of completed claim;

(7) Establishing procedures for verifying claims presented under this chapter;

(8) Establishing procedures for approving, modifying or denying claims;

(9) Empowering the review board to levy and collect an annual tank registration fee of five hundred dollars ($500) per underground storage tank not to exceed two thousand five hundred dollars ($2,500) per site on underground storage tanks which are subject to financial responsibility regulation and which are used to store petroleum products for which the motor and special fuels tax is inapplicable including but not limited to underground storage tanks used for the distribution of No. 2 heating oil, used/waste oil, kerosene or other materials as deemed appropriate by the review board; provided however that USTs containing heating oil used solely for onsite consumption shall be exempt from fees assessed under this statute require demonstration of financial responsibility under the department's regulations of underground storage facilities used for petroleum products and hazardous materials. These tanks which are exempted from the special motor fuels tax shall not be subject to the fee; and

(10) The eligibility of claims shall be determined by the board, provided however, that no claims shall be considered for costs incurred prior to January 1, 1994 by responsible parties who are owners or operators of no more than one location containing underground storage tanks and July 8, 1994 by all other responsible parties.

(11) Empowering the review board to recognize and arrange for performance-based and other contracts with the responsible party and contractor for the remediation of a release.

(12) Empowering the review board to arrange for the establishment of alternate means of financial responsibility.

46-12.9-8. Review board. [Effective until January 7, 2003.] -- (a) There is hereby established a review board There is hereby authorized, created and established a public corporation of the state having a distinct legal existence from the state and not constituting a department of state government to be known as the "underground storage tank review board," with such powers as are set forth in this chapter, to oversee administration and implementation of the fund, to review submissions and claims received from eligible parties and to proceed to approve, modify, or deny disbursements to eligible parties and to have such other powers as are provided herein.

(b) The review board shall consist of thirteen (13) members, as follows: the director of the department or his or her designee; the director of the department of business regulation or his or her designee; the auditor general of the state or his or her designee; a representative of the Rhode Island petroleum association to be appointed by the speaker of the house; a representative of the independent oil marketers association of New England to be appointed by the senate majority leader; a representative of the oil heat institute appointed by the governor; a member appointed by the speaker of the house; a member appointed by the senate majority leader; a member of a statewide environmental organization to be appointed by the governor; a representative of the independent petroleum dealers association of Rhode Island appointed by the governor; a member of the Rhode Island marine trade association, who is a marina operator and/or owner, to be appointed by the governor; a member of the general public, to be appointed by the governor; a member of the house of representatives to be appointed by the house minority leader.

(c) The review board shall file an annual report of all receipts and disbursements with the governor, general assembly, and secretary of state. When claims are pending, the review board shall meet no less than four (4) times per year.

(d) It is the intent of the general assembly, by the passage of this chapter, to vest in the review board all powers, authority, rights, privileges, and titles which may be necessary to enable it to accomplish the purposes herein set forth, and this chapter and the powers herein granted shall be liberally construed in conformity with those purposes.

(e) The review board and its corporate existence shall continue until terminated by law. Upon termination of the existence of the review board, all its rights and properties shall pass to and be vested in the state.

(f) The review board shall have the following powers, together with all powers incidental thereto or necessary for the performance of those stated in this chapter:

(1) to sue and be sued, complain and defend, in its corporate name;

(2) to have a seal which may be altered at pleasure and to use the seal by causing it, or a facsimile thereof, to be impressed or affixed or in any other manner reproduced;

(3) to purchase, take, receive, lease, or otherwise acquire, own, hold, improve, use, and otherwise deal in and with, real or personal property, or any interest therein, wherever situated;

(4) to make and execute agreements of lease and all other contracts and instruments necessary or convenient in the exercise of the powers and functions of the review board granted by this chapter;

(5) to make guarantees and incur or assume liabilities as the review board may deem appropriate;

(6) to invest and reinvest its funds;

(7) to secure the cooperation and assistance of the United States, and any of its agencies and of agencies of this state and its municipalities in the work of the review board;

(8) to accept grants, donations, drafts, loans of funds, and contributions in money, services, materials, or otherwise, from the United States or any of its agencies, from this state and its agencies, or from any other source, and to use or expend those moneys, services, materials, or other contributions in carrying out the purposes of this chapter;

(9) to acquire or contract to acquire, from any person, the federal government or the state, or any agency of either the federal government or state, by grant, purchase, lease, gift, or otherwise, or to obtain options for the acquisition of any property, real or personal, improved or unimproved, and interests in land less than the fee thereof; and to own, hold, clear, improve, develop, and rehabilitate, and to sell, assign, exchange, transfer, convey, lease, mortgage, or otherwise dispose of or encumber the property for the purposes of carrying out the provisions and intent of this chapter for such consideration as the review board shall determine;

(10) to elect or appoint officers and agents of the review board, and to define their duties and fix their compensation, including authority to employ attorneys, accountants, and engineering consultants, and such other employees or agents as the review board shall deem necessary in its judgment;

(11) to make and alter bylaws, not inconsistent with this chapter, for the administration and regulation of the affairs of the review board, and the bylaws may contain provisions indemnifying any person who is or was a director or a member of the review board, in the manner and to the extent provided in section 7-6-6 of the Rhode Island nonprofit corporation act;

(12) to have and exercise all powers necessary or convenient to effect its purposes;

(13) to enter into agreements, contracts, and other arrangements with the state and any of its departments, agencies, board or commissions relating to the execution or performance of any function or purpose of the review board, including, but not limited to, investments, employee compensation and employee benefits, and the state and its departments, agencies, boards and commissions are hereby authorized to enter into such agreements, contracts and other arrangements with the review board, and upon the request of the review board shall enter into such agreements, contracts and other arrangements with the review board.

46-12.9-8. Review board. [Effective January 7, 2003.] -- (a) There is hereby established a review board There is hereby authorized, created and established a public corporation of the state having a distinct legal existence from the state and not constituting a department of state government to be known as the "underground storage tank review board," with such powers as are set forth in this chapter, to oversee administration and implementation of the fund, to review submissions and claims received from eligible parties and to proceed to approve, modify, or deny disbursements to eligible parties and to have such other powers as are provided herein.

(b) The review board shall consist of thirteen (13) members, as follows: the director of the department or his or her designee; the director of the department of business regulation or his or her designee; the auditor general of the state or his or her designee; a representative of the Rhode Island petroleum association to be appointed by the speaker of the house; a representative of the independent oil marketers association of New England to be appointed by the president of the senate; a representative of the oil heat institute appointed by the governor; a member appointed by the speaker of the house; a member appointed by the president of the senate; a member of a state wide environmental organization to be appointed by the governor; a representative of the independent petroleum dealers association of Rhode Island appointed by the governor; a member of the Rhode Island marine trade association, who is a marina operator and/or owner, to be appointed by the governor; a member of the general public, to be appointed by the governor; a member of the house of representatives to be appointed by the house minority leader.

(c) The review board shall file an annual report of all receipts and disbursements with the governor, general assembly, and secretary of state. When claims are pending, the review board shall meet no less than four (4) times per year.

(d) It is the intent of the general assembly, by the passage of this chapter, to vest in the review board all powers, authority, rights, privileges, and titles which may be necessary to enable it to accomplish the purposes herein set forth, and this chapter and the powers herein granted shall be liberally construed in conformity with those purposes.

(e) The review board and its corporate existence shall continue until terminated by law. Upon termination of the existence of the review board, all its rights and properties shall pass to and be vested in the state.

(f) The review board shall have the following powers, together with all powers incidental thereto or necessary for the performance of those stated in this chapter:

(1) to sue and be sued, complain and defend, in its corporate name;

(2) to have a seal which may be altered at pleasure and to use the seal by causing it, or a facsimile thereof, to be impressed or affixed or in any other manner reproduced;

(3) to purchase, take, receive, lease, or otherwise acquire, own, hold, improve, use, and otherwise deal in and with, real or personal property, or any interest therein, wherever situated;

(4) to make and execute agreements of lease and all other contracts and instruments necessary or convenient in the exercise of the powers and functions of the review board granted by this chapter;

(5) to make guarantees and incur or assume liabilities as the review board may deem appropriate;

(6) to invest and reinvest its funds;

(7) to secure the cooperation and assistance of the United States, and any of its agencies and of agencies of this state and its municipalities in the work of the review board;

(8) to accept grants, donations, drafts, loans of funds, and contributions in money, services, materials, or otherwise, from the United States or any of its agencies, from this state and its agencies, or from any other source, and to use or expend those moneys, services, materials, or other contributions in carrying out the purposes of this chapter;

(9) to acquire or contract to acquire, from any person, the federal government or the state, or any agency of either the federal government or state, by grant, purchase, lease, gift, or otherwise, or to obtain options for the acquisition of any property, real or personal, improved or unimproved, and interests in land less than the fee thereof; and to own, hold, clear, improve, develop, and rehabilitate, and to sell, assign, exchange, transfer, convey, lease, mortgage, or otherwise dispose of or encumber the property for the purposes of carrying out the provisions and intent of this chapter for such consideration as the review board shall determine;

(10) to elect or appoint officers and agents of the review board, and to define their duties and fix their compensation, including authority to employ attorneys, accountants, and engineering consultants, and such other employees or agents as the review board shall deem necessary in its judgment;

(11) to make and alter bylaws, not inconsistent with this chapter, for the administration and regulation of the affairs of the review board, and the bylaws may contain provisions indemnifying any person who is or was a director or a member of the review board, in the manner and to the extent provided in section 7-6-6 of the Rhode Island nonprofit corporation act;

(12) to have and exercise all powers necessary or convenient to effect its purposes;

(13) to enter into agreements, contracts, and other arrangements with the state and any of its departments, agencies, board or commissions relating to the execution or performance of any function or purpose of the review board, including, but not limited to, investments, employee compensation and employee benefits, and the state and its departments, agencies, boards and commissions are hereby authorized to enter into such agreements, contracts and other arrangements with the review board, and upon the request of the review board shall enter into such agreements, contracts and other arrangements with the review board.

46-12.9-11. Funding. -- (a) There is hereby imposed an environmental protection regulatory fee of at the rate of one cent ($0.01) per gallon payable of motor fuel, to be collected by distributors of motor fuel when the product is sold to owners and/or operators of underground storage tanks. Each distributor shall be responsible to the tax administrator for the collection of the regulatory fee, and if the distributor is unable to recover the fee from the person who ordered the product, the distribution shall nonetheless remit to the tax administrator the regulatory fee associated with the delivery. In accordance with the regulations to be promulgated hereunder, the fee shall be collected, reported, and paid to the Rhode Island division of taxation as a separate line item entry, on a quarterly tax report by those persons charged with the collection, reporting, and payment of motor fuels taxes. This fee shall be administered and collected by the division of taxation. Notwithstanding the provisions of this section, the fee shall not be applicable to purchases by the United States government.

(b) All fees derived under the provisions of this chapter, including tank registration fees assessed pursuant to section 46-12.9-7(9), shall be paid to and received by the general treasurer of the state of Rhode Island, who review board, which shall keep such money in a distinct interest bearing restricted receipt account to the credit of and for the exclusive use of the fund, as directed by the review board; provided, however, that the sum of one million three hundred seventy-five thousand dollars ($1,375,000) shall be transferred quarterly by the state controller to the state general fund on July 1 and October 1, 1996 and January 1 and April 1, 1997. Any transfers to the general fund under this subsection shall not be made in the event that the balance of the fund is less than two million dollars ($2,000,000) or there are any outstanding claims which have not been fully satisfied. . All fees collected may be invested as provided by law and all interest received on such investment shall be credited to the fund.

(c) When the fund reaches the sum of eight million dollars ($8,000,000), the imposition of the fee set forth in this chapter shall be suspended, and the division of taxation shall notify all persons responsible for the collection, reporting and payments of the fee of the suspension. In the event that the account balance of the fund subsequently is reduced to a sum less than five million dollars ($5,000,000) as a result of fund activity, the fee shall be reinstated by the division of taxation, following proper notice thereof, and once reinstated, the collection, reporting, and payment of the fee shall continue until the account balance again reaches the sum of eight million dollars ($8,000,000).

(d) Upon the determination by the review board that the fund has reached a balance sufficient to satisfy all pending or future claims, the review board shall recommend to the general assembly the discontinuation of the imposition of the fee created in this section.

SECTION 2. This act shall take effect upon passage.