Groundwater Oil Clean-up Fund,
Fund Insurance Review Board Report
Groundwater Oil Clean-up Fund
A simple guide to the Ground Water Oil Clean-up Fund (Fund). This is not intended as a substitute for the complete Ground Water Protection and Fund statutes, Title 38 M.R.S.A. § 561-570.
In response to the potentially high cost of cleaning up oil spills and the availability of affordable private insurance, the Legislature created the Ground Water Oil Clean-up Fund to address certain, eligible costs associated with the clean up of discharges of oil from underground (UST) and aboveground (AST) oil storage tank systems.
Eligible costs are defined as: "...those direct expenses including expenses for site investigation that: are necessary to clean up discharges of oil to the satisfaction of the commissioner; are cost-effective and technologically feasible and reliable; effectively mitigate or minimize damages; and provide adequate protection of public health and welfare and the environment." Eligible costs may include excavation of contaminated soil, product recovery, approved hydro geologic investigation, well filters, 3rd party damage claims, or other clean-up actions approved by DEP. The Fund statute is located in Title 38 M.R.S.A. § 569-A of the Groundwater Protection Laws. In addition, more details on eligible costs can be found in the Fund Coverage Cost Guide
The Department of Environmental Protection administers claims applications related to discharges of oil from UST systems.
The Office of State Fire Marshal - administers claims applications related to discharges of oil from AST systems.
The Fund will not cover costs related to any of the following:
- An oil discharge discovered on or before April 1, 1990
- Leaks or oil discharges discovered after October 1, 1998, from non-conforming tanks or piping (e.g., unprotected “bare” steel)
- Former facilities; i.e. an UST/ AST that do not exist when contamination was discovered
- Mystery spills from unknown sources
- UST/ AST or piping removal and “Appendix P” site assessments
- Investigation or clean-up activities that are not required by DEP
- Discharges or contamination that are not oil. “Oil” includes gasoline, kerosene, diesel, heating oil, aviation fuel, heavy oil, or non-hazardous waste oil from motor fuel, commercial, residential and other tanks
How the Fund Works, Step-by-Step:
(1) The tank owner or operator must promptly report discovery of an oil discharge or contamination caused by tank or piping to DEP, and comply in a timely manner with instructions for investigation and/or clean-up.
To report a leak, spill or discovery of oil contamination call:
1 (800) 482-0777 (24 hours a day, 365 days a year)
(2) Request a Ground Water Oil Clean-up Fund (Fund) application form.
If you are an UST owner, contact Diana McLaughlin, DEP UST Enforcement at (207) 287-7856. If you are an AST owner, contact the Office of State Fire Marshal at (207) 626-3890.
(3) An applicant must choose between the following in managing the clean up:
"Option 1" -- DEP directly manages and controls clean-up, hires contractors and directly pays approved costs; or
"Option 2" -- Applicant hires clean-up contractors, makes decisions, pays bills, etc. and requests reimbursement from DEP of clean-up costs after receipt of Department Order. Only clean-up costs that are pre-approved by the Department staff will be reimbursed. Note: Fund applicants who are seeking liability protection under the Department’s Voluntary Response Action Program (VRAP) (link to: http://www.maine.gov/dep/spills/vrap/index.html) must use Clean-up Option 2.
(4) Apply for coverage by submitting a complete application within 180 days of reporting the discharge or contamination.
As described above, State law prohibits coverage by the Fund of certain spill incidents or clean-up costs. DEP encourages responsible parties to call before submitting an application for help in determining which costs are eligible and whether application to the Fund would be appropriate.
(5) The DEP (UST) or State Fire Marshal (AST) will review the application, determine eligibility, and determine standard & conditional deductibles. DEP or State Fire Marshal (as applicable) assesses two types of deductibles:
A. Standard deductible based on number of UST facilities/ volume of AST facilities owned by owner of facility seeking coverage; and
B. Conditional deductible(s) for lack of compliance with applicable UST or AST rules.
An owner of UST facility seeking Fund coverage owns a total of three (3) locations with USTs, has failed to maintain leak detection at a facility, and has failed to promptly report to the Department evidence of a possible leak.
A. Standard Deductible: $5,000
B. Conditional Deductibles:
$10,000 -- failure to report evidence of a possible leak or to maintain spill log
+ $5,000 -- failure to properly maintain leak detection equipment
= $15,000 conditional deductible
Total deductible = $5,000 + $15,000 = $20,000
(A complete list of deductibles is provided in statute Title 38 M.R.S.A. § 568-A.)
(6) Within 90 days of receiving a complete application DEP (UST) or State Fire Marshal (AST) will issue a Department Order that specifies eligibility and deductibles.
(7) DEP Oil Remediation & Claims staff will request payment of the deductible from the applicant, or determine if there are eligible clean-up costs above deductible to be reimbursed to applicant (Clean-up Option 2). The Applicant must pay the deductible amount or total eligible clean-up costs, whichever is less.