For Marty Lipp, the only thing deeper than the 8-foot hole contractors dug in his driveway to remove an old heating oil storage tank may soon be the one in his wallet for having to unexpectedly pick up the tab for the work. Lipp, 53, of Maplewood, will now have to fork over up to $12,000 after a popular...
Marty Lipp poses in front of the underground storage tank removed from his Maplewood property. Since a popular Department of Environmental Protection fund to help remediate the tanks dried up, Lipp and some 1,300 others across New Jersey will either have to pay for festering environmental problems all by themselves - or wait to start the work.For Marty Lipp, the only thing deeper than the 8-foot hole contractors dug in his driveway to remove an old heating oil storage tank may soon be the one in his wallet for having to unexpectedly pick up the tab for the work.
Lipp, 53, of Maplewood, will now have to fork over up to $12,000 after a popular state fund created to help residents remove leaky underground tanks ran dry last week — just five years after its coffers bulged with $90 million.
"I checked the website a day or so before this happened, and suddenly they hang out the sign and say there’s no more money?" said Lipp, a freelance writer whose work has appeared in The Star-Ledger. "I don’t understand where the oversight was, and how they could not see this was coming."
About 1,300 people seeking grants or loans will not get help for at least a year, creating a backlog of an estimated $33 million worth of spill cleanups, said Frank Pinto, chief financial officer for the state Department of Environmental Protection’s Site Remediation Program. The money woes also will prevent the agency from processing new requests until at least 2014, Pinto said.
Once celebrated as the solution to getting rid of rusted and aging tanks, the fund ran out of cash because of maneuvers to divert dollars to other priorities and expand the number of people and institutions eligible for the program.
"This was a very successful program but then everyone started trying to take a little piece of it and now the program is basically being diverted to death," said Jeff Tittel, director of the New Jersey chapter of the Sierra Club.
Average cleanup costs for leaky underground tanks range from $3,000 to $8,000, according to grants and loans awarded. But spills that cause widespread contamination can cost $100,000 or more to remediate. The program had paid for 12,587 projects as of Dec. 31, 2010, according to the state Economic Development Authority, which oversees the fund along with the DEP.
Environmentalists say the ramifications of the fund’s demise could be extreme: Leaking tanks could remain in the ground longer, increasing the likelihood of a major spill.
Typical underground home heating oil tanks hold 550 to 1,000 gallons, and a spill of just one gallon of oil into the groundwater can contaminate 1 million gallons — the equivalent of about 1½ Olympic-size swimming pools.
Though the DEP prefers not to take strict enforcement against homeowners, David Sweeney, assistant commissioner for the department’s site remediation program, said by law, residents are responsible for the spill.
"There will be cases where homeowners don’t have the money to do it, and if it ranks high enough, we’ll go in there and then we’ll put a lien on the property," Sweeney said.
State Sen. Bob Smith (D-Middlesex), chairman of the Senate Environment and Energy Committee, said he plans to hold a hearing to determine why the money ran out and why the problem was not brought to the Legislature’s attention sooner.
"Everybody’s intention will be to try to make sure we keep our promises to our citizens," Smith said.
The EDA warned last year in its annual report that the tank fund could hit empty this year and recommended lawmakers take action. But no changes were made.
Created in 1997 under Gov. Christie Whitman, the underground storage tank fund provides eligible applicants with grants or loans to pay for upgrades to old or leaking underground storage tanks and for cleanups as a result of spills.
Money for the fund came from a constitutional amendment dedicating a portion of the state’s corporate business tax to tank remediation as well as to a second account to pay for the cleanup of hazardous sites known as "brownfields."
The tank fund, however, had a unique problem: The dollars it accumulated outstripped the demand for the program, Pinto said. By 2006, it had upward of $90 million, he said, but the DEP processed only $7 million to $9 million worth of work each year. As a result, lawmakers approved — and voters agreed — to divert the corporate business tax money entirely to the brownfield fund in 2006. Lawmakers that year also began diverting dollars intended for the tank fund to other areas, including DEP administration, the EDA said.
There was a safeguard: When the tank fund dropped to $20 million, a portion of the diverted dollars would be restored. But the money ran out anyway, because lawmakers through the years allowed more and more people and institutions to apply.
They opened the program to colleges, universities, nonprofit groups and volunteer emergency services. The income limits for residents to get assistance increased to $250,000, maximum grants doubled to $500,000, and maximum loans doubled to $2 million. Those with nonleaking tanks were also allowed to apply. By 2010, the DEP was approving more than $40 million worth of cleanup work, Pinto said.
The fund’s bottom line dropped to $20 million last fall and to $9.6 million on Jan. 1. It is expected to get $16.6 million from the corporate business tax July 1, the start of the new fiscal year. But that money will pay for only DEP-approved applications already submitted to the EDA, and not any applications stuck in the DEP’s backlog.
The program for replacing nonleaking tanks has been shut down, Pinto said. He said applications on the backlog will be processed based on when they were received and the threat a leaking tank poses to drinking water.