Chapter 160
2016 -- H 7913 SUBSTITUTE A
Enacted 06/27/2016

A N   A C T
RELATING TO WATERS AND NAVIGATION -- RHODE ISLAND UNDERGROUND STORAGE TANK FINANCIAL RESPONSIBILITY ACT

Introduced By: Representative Jan Malik
Date Introduced: March 10, 2016

It is enacted by the General Assembly as follows:
     SECTION 1. Sections 46-12.9-3, 46-12.9-5, 46-12.9-7, 46-12.9-8, 46-12.9-9 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:
      (10)(1) "Review board" "Advisory board" means the Rhode Island underground storage
tank financial responsibility review advisory board established pursuant to the provisions of § 46-
12.9-8.
     (1)(2) "Department" means the Rhode Island department of environmental management.
      (2)(3) "Director" means the director of the department of environmental management, or
his or her designee.
      (3)(4) "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, and approved, by the department or voluntarily performed by the responsible
party and not specifically identified by the review board department as ineligible.
      (4)(5) "Fund" means the Rhode Island underground storage tank financial responsibility
fund established herein.
      (5)(6) "Operator" means any person in control of, or having the responsibility for, the
daily operation of an underground, storage-tank system.
      (6)(7) "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.
      (7)(8) "Petroleum" means crude oil, crude oil fractions, and refined petroleum fractions,
including gasoline, kerosene, heating oils, used/waste oil, and diesel fuels.
      (8)(9) "Release" means any leaking, emitting, discharging, escaping, or leaching of
petroleum from any underground storage tank or underground storage-tank system into the
environment.
      (9)(10) "Responsible party" means the person or persons liable for release of petroleum
or the remediation of a release.
      (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-tanks 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.
      (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.
      (13) "Underground storage-tank system" means an underground storage tank and its
associated ancillary equipment and containment system, if any.
     46-12.9-5. Purpose of fund. -- (a) 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, and to take necessary action to proactively prevent
such releases.
      (b) 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 review board or its designee department for the following purposes.:
      (1) 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 § 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;
      (2) 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 (b)(1) of this section; provided, that such
claims are found by the review board department to be justified, reasonable, related to the release
of petroleum, and not excessive or spurious in nature; and
      (3) 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.;
      (4) 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.; and
      (5) Eligible costs incurred by the department to support the fund, including, but not
limited to, all personnel support to process and review of claims in order to formulate
recommendations for reimbursement for consideration by the review board, and providing
meeting space for board meetings; provided, however, that no more than five hundred and fifty
thousand dollars ($550,000) shall be dispensed from the fund for administrative purposes during
any fiscal year. The department shall directly access the fund, pursuant to the limits set forth in
subdivision 46-12.9-5(b)(1), to pay for such expenses.
      (6) Grants to any third party for purposes of removal of underground storage tanks
and/or replacement of underground storage tanks with other fuel storage and distribution systems,
including aboveground storage tanks, when such removal and/or replacement will minimize the
potential future exposure of the fund to major expenses related to reimbursement of costs incurred
in response or remediation should a future release occur. Grants under this section shall be limited
to fifty thousand dollars ($50,000) per site and shall be in addition to any eligible reimbursement
for clean up expenses at that site.
     46-12.9-7. Rules and regulations. -- 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) A method of providing periodic reimbursement for eligible costs incurred by an
eligible party after July 8, 1994. Such reimbursement shall be processed in the order that the
claims were filed, subject to funds availability, except in the case where the director finds that
funds must be expended out of order in order to abate an environmental emergency;
      (5) A requirement that the review board department 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;
      (6) Establishing procedures for verifying claims presented under this chapter;
      (7) Establishing procedures for approving, modifying, or denying claims;
      (8) The eligibility of claims shall be determined by the review board department;
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.;
      (9) Empowering the department to recognize and arrange for performance-based and
other contracts with the responsible party and contractor for the remediation of a release.; and
      (10) Empowering the department to arrange for the establishment of alternate means of
financial responsibility.
     46-12.9-8. Review board Advisory board. -- (a) There is hereby authorized, created,
and established the "underground storage tank review advisory board," to approve, modify, or
deny disbursements to eligible parties and to have such other powers as are provided herein.
      (b) The review advisory board shall consist of nine (9) seven (7) members, as follows:
the director of the department of environmental management, or his or her designee, who shall be
a subordinate within the department of environmental management. The governor, with the
advice and consent of the senate, shall appoint eight (8) six (6) public members, one of whom
shall have expertise and experience in financial matters. In making these appointments the
governor shall give due consideration to recommendations from the American Petroleum
Institute, the Independent Oil Marketers Association, the Oil Heat Institute, the Environment
Council, the Independent Oil Dealers Association, and the Rhode Island Marine Trade
Association. The newly appointed members will serve for a term of three (3) years commencing
on the day they are qualified. Any vacancy which may occur on the board shall be filled by the
governor, with the advice and consent of the senate, for the remainder of the unexpired term in
the same manner as the member's predecessor as prescribed in this section. The members of the
board shall be eligible to succeed themselves. Members shall serve until their successors are
appointed and qualified. No one shall be eligible for appointment unless he or she is a resident of
this state. The members of the board shall serve without compensation. Those members of the
board, as of the effective date of this act [July 15, 2005], who were appointed to the board by
members of the general assembly, shall cease to be members of the board on the effective date of
this act, and the governor shall thereupon nominate three (3) members, each of whom shall serve
the balance of the unexpired term of his or her predecessor. Those members of the board, as of
the effective date of this act [July 15, 2005], who were appointed to the board by the governor,
shall continue to serve the balance of their current terms. Thereafter, the appointments shall be
made by the governor as prescribed in this section.
      (c) When claims are pending, the review The advisory board shall meet at the call of the
chair. All meetings shall be held consistent with chapter 46 of title 42.
      (d) The review advisory board and its corporate existence shall continue until terminated
by law. Upon termination of the existence of the review advisory board, all its rights and
properties shall pass to and be vested in the state.
      (e) The review advisory board shall have the following powers and duties, together with
all powers incidental thereto or necessary for the performance of those stated in this chapter:
      (1) To elect or appoint officers and agents of the review advisory board, and to define
their duties:
      (2) To make and alter bylaws, not inconsistent with this chapter, for the administration of
the affairs of the review advisory board. Such bylaws may contain provisions indemnifying any
person who is, or was, a director or a member of the review advisory board, in the manner and to
the extent provided in § 7-6-6 of the Rhode Island nonprofit corporation act;
      (3) To oversee, review, and evaluate the condition and performance of the underground
storage-tank fund and approve and submit an annual report within ninety (90) days after the end
of each fiscal year to the governor, the speaker of the house of representatives, the president of
the senate, and the secretary of state, of its activities during that fiscal year. The report shall
provide information provided by the department, including: an operating statement summarizing
meetings or hearings held, including meeting minutes, subjects addressed, and decisions
rendered; a summary of the review advisory board's actions, fees levied, collected, or received, as
prescribed in §§ 46-12.9-7 and 46-12.9-11, claims submitted, verified, approved, modified, and
denied, as prescribed in § 46-12.9-7, and reconsideration hearings held as prescribed in § 46-12.9-
9; a synopsis of any law suits or other legal matters related to the authority of the review board
fund; and a summary of performance during the previous fiscal year, including accomplishments,
shortcomings, and remedies; a briefing on anticipated activities in the upcoming fiscal year; and
findings and recommendations for improvements; and a summary of any training courses held
pursuant to subdivision (f)(15) (e)(4) of this section. The report shall be posted electronically as
prescribed in § 42-20-8.2. The advisory board may make recommendations or suggestions on the
claims process and/or the condition and management of the fund, and the department shall
respond, in writing, to any of these suggestions or recommendations; and
      (4) To conduct a training course for newly appointed and qualified members and new
designees of ex-officio members within six (6) months of their qualification or designation. The
course shall be developed by the executive director, approved by the board, and conducted by the
executive director. The board may approve the use of any board or staff members or other
individuals to assist with training. The training course shall include instruction in the following
areas: the provisions of chapters 46-12.9, 42-46, 36-14, and 38-2 Chapter 12.9 of title 46,
Chapter 46 of title 42, Chapter 14 of title 36 and Chapter 2 of title 38; and the board's rules
and regulations. The director of the department of administration shall, within ninety (90) days of
the effective date of this act [July 15, 2005], prepare and disseminate training materials relating to
the provisions of chapters 36-14, 38-2, and 42-46 Chapter 14 of title 36, Chapter 2 of title 38,
and Chapter 46 of title 42.
      (f) Upon the passage of this act and the appointment and qualification of the three (3)
new members prescribed in subsection (b) of this section, the board shall elect, from among its
members, a chair. Thereafter, the board shall elect annually, in February, a chair from among the
members. The board may elect, from among its members, such other officers as it deems
necessary.
      (g) Six (6) Four (4) members of the board shall constitute a quorum and the vote of the
majority of the members present shall be necessary and shall suffice for any action taken by the
board. No vacancy in the membership of the board shall impair the right of a quorum to exercise
all of the rights and perform all of the duties of the board.
      (h) Members of the board shall be removable by the governor pursuant to section § 36-1-
7 and removal solely for partisan or personal reasons unrelated to capacity or fitness for the office
shall be unlawful.
     46-12.9-9. Reconsideration hearing. -- Any person aggrieved by a decision of the
review board on a claim submitted to the department may request a reconsideration hearing
before the review board department of environmental management administrative adjudication
division under the provisions of the regulations of the board that office and such regulations shall
be consistent with the Rhode Island Administrative Procedures Act, chapter 35 of title 42. Any
such decision shall contain a notice of the right to request a hearing and may specify a reasonable
time limit, not to exceed twenty-one (21) days, within which said person shall request a hearing.
If no such request is made in a timely manner, the said person shall be deemed to have assented to
the decision. If a timely request is received, the review board, within a reasonable period of time,
shall act upon such request in accordance with the provisions of the Rhode Island
Aadministrative Pprocedures Aact.
     46-12.9-11. Fundings. -- (a) There is hereby imposed an environmental protection
regulatory fee 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 distributor 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) Of the one-cent- ($0.01) per-gallon ($0.01) environmental-protection regulatory fee
collected by distributors of motor fuel and paid to the Rhode Island division of taxation, one-half
cent ($0.005) shall be deposited in the Iintermodal Ssurface Ttransportation Ffund to be
distributed pursuant to § 31-36-20 and one-half cent ($0.005) shall be paid to the underground
storage-tank review board. All environmental protection regulatory fees paid to the review board
department, including tank registration fees assessed pursuant to § 46-12.9-7(9), shall be received
by the review board department, 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 provided that for
the period January 1, 2008, through June 30, 2008, all revenues generated by the environmental
protection regulatory fee, up to a maximum of two million dollars ($2,000,000), shall be
deposited into the general fund. In fiscal year 2009, all revenues generated by the environmental
protection regulatory fee, up to a maximum equivalent to two million two hundred thirty-seven
thousand five hundred dollars ($2,237,500), shall be deposited into the Iintermodal Ssurface
Ttransportation Ffund. 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 advisory board and the department that the
fund has reached a balance sufficient to satisfy all pending or future claims, the review advisory
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.
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LC004982/SUB A
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