Order Code RS21201
Updated March 15, 2007
Leaking Underground Storage Tanks:
Prevention and Cleanup
Mary Tiemann
Specialist in Environmental Policy
Resources, Science, and Industry Division
Summary
To address a nationwide water pollution problem caused by leaking underground
storage tanks (USTs), Congress created a leak prevention, detection, and cleanup
program in 1984. In 1986, Congress established the Leaking Underground Storage Tank
(LUST) Trust Fund to help the Environmental Protection Agency (EPA) and states
oversee LUST cleanup activities and pay the costs of remediating leaking petroleum
USTs where owners fail to do so. Despite progress in the program, challenges remain.
A key issue has been that state resources have not met the demands of administering the
UST leak prevention program. States have long sought larger appropriations from the
trust fund to support the LUST cleanup program, and some have sought flexibility to use
the fund to administer and enforce the UST leak prevention program. Another issue has
involved the detection of methyl tertiary butyl ether (MTBE) in groundwater at many
LUST sites. This gasoline additive was used widely to reduce air pollution from auto
emissions. However, MTBE is very water soluble and, once released, tends to travel
farther than conventional gas leaks, making it more likely to reach water supplies and
more costly to remediate. For more than a decade, Congress considered various bills to
broaden the use of the trust fund and strengthen the leak prevention program.
In the Energy Policy Act of 2005 (P.L. 109-58, H.R. 6), the 109th Congress added
new leak prevention and enforcement provisions to the UST program and authorized
EPA and states to use the trust fund to clean up MTBE leaks and to implement and
enforce the new requirements. Despite the new mandates and funding authority, no
increase in funding was requested or provided for FY2007. A similar amount, $72.5
million, has been requested from the LUST Trust Fund for FY2008. This report reviews
the LUST program, legislative changes made by P.L. 109-58, and related developments.
Background
In the 1980s, EPA determined that many of the roughly 2.2 million underground
storage tanks (USTs) in the United States, most of them storing petroleum, were leaking.
Many other tanks were nearing the end of their useful life expectancy and were expected
to leak in the near future. Approximately 50% of the U.S. population relies on ground

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water for their drinking water, and states were reporting that leaking underground tanks
were the leading source of groundwater contamination.
In 1984, Congress responded to this environmental and safety threat and established
a leak prevention, detection, and cleanup program for USTs containing chemicals or
petroleum through amendments to the Solid Waste Disposal Act (42 U.S.C. 6901 et seq.,
also known as the Resource Conservation and Recovery Act (RCRA)). Subtitle I directed
EPA to establish operating requirements and technical standards for tank design and
installation, leak detection, spill and overfill control, corrective action, and tank closure.
The universe of regulated tanks was extremely large and diverse, and included many small
businesses. Consequently, EPA phased in the tank regulations over a 10-year period
(1988 through 1998). Strict standards for new tanks took effect in 1988, and all tanks
were required to comply with leak detection regulations by late 1993. All tanks installed
before 1988 had to be upgraded (with spill, overfill, and corrosion protection), replaced,
or closed by December 22, 1998.
In 1986, Congress established a response program for leaking petroleum USTs
through the Superfund Amendments and Reauthorization Act (P.L. 99-499), which
amended Subtitle I of RCRA. The amendments authorized EPA and states to respond to
petroleum spills and leaks, and created the Leaking Underground Storage Tank (LUST)
Trust Fund to help EPA and states cover the costs of responding to leaking USTs in cases
where the UST owner or operator does not clean up a site. EPA and the states primarily
use the annual LUST Trust Fund appropriation to oversee and enforce corrective actions
performed by responsible parties. They also use the funds to conduct corrective actions
where no responsible party has been identified, where a responsible party fails to comply
with a cleanup order, in the event of an emergency, and to take cost recovery actions
against parties. EPA and states have been successful in getting responsible parties to
perform most cleanups. In these cases, the cleanup costs typically have been paid for by
a state fund (discussed below), the responsible party, and/or private insurance.
State Funds. The 1986 law also directed EPA to establish financial responsibility
requirements to ensure that UST owners and operators are able to cover the costs of
taking corrective action and compensating third parties for injuries and property damage
caused by leaking tanks. As mandated, EPA issued regulations requiring most tank
owners and operators selling petroleum products to demonstrate a minimum financial
responsibility of $1 million. Alternatively, owners and operators may rely on state
assurance funds to demonstrate financial responsibility, saving them the cost of
purchasing private insurance.
Most states established financial assurance funds. Unlike the federal LUST Trust
Fund, state funds often are used to reimburse financially solvent tank owners and
operators for some or all of the costs of remediating leaking tank sites. Revenues for state
funds typically have been generated through gas taxes and tank fees and, collectively,
these funds have provided more cleanup funds than the LUST Trust Fund. A June 2005
survey of states showed that, cumulatively, states had collected and spent roughly $13.14
billion through their funds. In 2005, state funds collected $1.53 billion in annual revenues
and spent a total of $1.06 billion, while outstanding claims against state funds reached
$1.80 billion. Twenty states extended their fund’s original sunset date to address the
backlog of leaking tanks. Ten states have made a transition to private insurance. (See
2005 State Financial Assurance Funds Survey at [http://www.astswmo.org].)

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LUST Trust Fund: Funding and Uses
The LUST Trust Fund is funded primarily through a 0.1 cent-per-gallon motor fuels
tax that began in 1987. The Energy Policy Act of 2005 (P.L. 109-58, H.R. 6) extended
the tax through March 2011. During FY2006, the tax generated $197 million, and the
trust fund earned roughly $99 million in interest on the balance in the fund. By the end
of FY2006, the fund’s balance had reached $2.57 billion.
Congress has annually appropriated funds from the trust fund to support the LUST
program. EPA estimates that the average cost of cleaning up a release from a tank is
$125,000, and that by the end of FY2006, 113,919 releases still needed remediation.
Although EPA expects that private parties will pay for most cleanups, states estimate that
it will cost $12 billion to remediate at least 54,000 tank sites that lack viable owners.1

To support the LUST program, Congress provided $75.6 million from the trust fund
for FY2004, $69.4 million for FY2005, and $72 million for FY2006.2 For FY2007, the
House approved and the Senate Appropriations Committee recommended $72.8 million,
as requested. The continuing resolution providing FY2007 appropriations (P.L. 110-5,
H.J.Res. 20) generally funded EPA programs at the FY2006 level, which included $72
million from the LUST Trust Fund. The request for FY2008 is $72.5 million.
In recent years, EPA has allocated approximately 81% (roughly $58 million) of the
annual trust fund appropriation to the states in the form of cooperative agreements and 4%
to support LUST-eligible activities on Indian lands. EPA has used the remaining 15% for
its program responsibilities. The Energy Policy Act of 2005 (P.L. 109-58, §1522) requires
EPA to allot least 80% of the LUST Trust Fund appropriation to the states.
Under cooperative agreements with EPA, the states receive grants to help cover the
cost of administering the LUST program. States use most of their LUST program grants
to hire staff for technical oversight of corrective actions performed by responsible parties.
They typically use about one-third of the LUST money they receive for cleaning up
abandoned tank sites and undertaking emergency responses.
EPA uses its portion of the appropriation to oversee cooperative agreements with
states, implement the LUST corrective action program on Indian lands, and support state
and regional offices. EPA priorities in the LUST program include reducing the backlog
of confirmed releases; promoting better and less expensive cleanups; providing assistance
to Indian tribes; assisting with the cleanup of more complicated sites, especially sites
contaminated with MTBE; and supporting state programs with technical assistance.
Program Accomplishments and Issues
EPA reports that since the federal underground storage tank program began, more
than 1.6 million of the roughly 2.2 million petroleum tanks subject to regulation have
been closed and, overall, the frequency and severity of leaks from UST systems have been
1 Government Accountability Office, Leaking Underground Storage Tanks: EPA Should Take
Steps to Better Ensure the Effective Use of Public Funding for Cleanups, GAO-07-152, 2007.
2 For FY2006, Congress provided another $15 million in supplemental appropriations for
cleaning up releases from tanks damaged by hurricanes Katrina and Rita.

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reduced significantly. Through FY2006, 641,881 tanks remained in service and subject
to UST regulations, 464,728 releases had been confirmed, 435,631 cleanups had been
initiated, and 350,813 cleanups had been completed. The backlog of sites requiring
remedial action dropped to 113,915 sites. During FY2006, 8,361 releases were newly
confirmed, compared with 7,421 in FY2005, 7,850 in FY2004 and 12,000 in FY2003.3
Nearly 14,500 corrective actions were completed in FY2006.
Methyl Tertiary Butyl Ether (MTBE). In the 1990s, as states and EPA were
making solid progress in addressing tank leaks, another problem emerged. The gasoline
additive MTBE was being detected at thousands of LUST sites and in numerous drinking
water supplies, usually at low levels. Gasoline refiners had relied heavily on MTBE to
produce gasoline that contained oxygenates, as required by the 1990 Clean Air Act
Amendments as a way to improve combustion and reduce emissions. Once released into
the environment, however, MTBE moves through soil and into water more rapidly than
other gasoline components, and it is more difficult and costly to remediate than
conventional gasoline. Because of its mobility, MTBE is more likely to reach water
supplies than conventional gas leaks. Although MTBE is thought to be less toxic than
some gasoline components (such as benzene), even small amounts can render water
undrinkable because of its strong taste and odor. Also, in 1993, EPA’s Office of Research
and Development concluded that the data support classifying MTBE as a possible human
carcinogen.4 Although EPA has not done so, at least seven states have set drinking water
standards for MTBE, and many states have established cleanup standards or guidelines.
At least 25 states have enacted limits or bans on the use of MTBE in gasoline.
At least 42 states require testing for MTBE in ground water at LUST sites. In a 2000
survey, 31states reported that MTBE was found in ground water at 40% or more of LUST
sites in their states; 24 states reported MTBE at 60% to 100% of sites. An update of this
survey found that many sites had not been tested for MTBE and that most states did not
plan to reopen closed sites to look for MTBE.5 The total cost of treating MTBE-
contaminated drinking water is unknown. Two studies by water utilities place their
estimates of the costs, given limited data, at $25 billion and $33.2 billion.6
Implementation and Compliance Issues. EPA estimated that by FY2001,
89% of USTs had upgraded tank equipment to meet federal requirements. However, the
Government Accountability Office (GAO) reported that because of poor training of tank
owners, operators, and other personnel, about 200,000 (29%) USTs were not being
operated or maintained properly, thus increasing the risk of leaks and ground water
contamination. GAO also reported that only 19 states physically inspected all their tanks
3 For state-by-state information, see [http://www.epa.gov/oust/cat/camarchv.htm].
4 U.S. Environmental Protection Agency, Assessment of Potential Health Risks of Gasoline
Oxygenated with Methyl Tertiary Butyl Ether (MTBE), EPA/600/R-93/206, 1993.
5 The New England Interstate Water Pollution Control Commission’s 2000 Survey of State
Experiences with MTBE Contamination at LUST Sites, and the 2003 Survey of Oxygenates at
LUST Sites.
6 Respectively, the American Water Works Association, A Review of Cost Estimates of MTBE
Contamination of Public Wells, June 21, 2005, and the Association of Metropolitan Water
Agencies, Cost Estimate to Remove MTBE Contamination from Public Drinking Water Systems
in the United States, June 20, 2005.

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every three years (the minimum EPA considers necessary for effective tank monitoring)
and that, consequently, EPA and states lacked the information needed to evaluate the
effectiveness of the tank program and take appropriate enforcement actions.7
EPA has pursued several initiatives to improve the effectiveness of the tank program.
Under an initiative to improve compliance, EPA revised the definition of compliance
(“significant operational compliance”) to place greater emphasis on the proper operation
and maintenance of tank equipment and systems. At the end of FY2006, EPA reported
that 76% of recently inspected UST facilities were in compliance with the release
prevention requirements, 72% were in compliance with the leak detection requirements,
and 62% of facilities had complied with the combined requirements.
After years of deliberation, Congress addressed various concerns regarding the UST
leak prevention and LUST cleanup programs through the Energy Policy Act of 2005. As
discussed below, this act imposes new mandates regarding tank inspections, operator
training, delivery prohibition, secondary containment, and financial responsibility.
Legislation
The 109th Congress passed legislation addressing LUST and MTBE. P.L. 109-6
(H.R. 1270) enacted in March 2005, extended the 0.1 cent-per-gallon motor fuels tax that
finances the LUST Trust Fund through September 2005. The Energy Policy Act of 2005
(P.L. 109-58) extended the tax through March 2011 (§ 1362), and eliminated the Clean
Air Act oxygenated fuel requirement that promoted greater use of MTBE (§ 1504(a)).
The Underground Storage Tank Compliance Act. Title XV, Subtitle B, of
the Energy Policy Act comprises “The Underground Storage Tank Compliance Act”
(USTCA). This act amended SWDA Subtitle I to add new leak prevention and
enforcement provisions to the UST regulatory program and impose new requirements on
states, EPA, and tank owners. The USTCA requires EPA, and states that receive funding
under Subtitle I, to conduct UST compliance inspections at least every three years. It also
requires states to comply with EPA guidance prohibiting fuel delivery to ineligible tanks,
develop training requirements for UST operators and individuals responsible for tank
maintenance and spill response, prepare compliance reports on government-owned tanks
in the state, and implement groundwater protection measures for UST manufacturers and
installers. The act also directs states to require either that new tanks located near
community water systems or wells be equipped with secondary containment, or that UST
manufacturers and installers maintain evidence of financial responsibility to provide for
the costs of corrective actions. (EPA USTCA implementation information and documents
are available online at [http://www.epa.gov/oust/fedlaws/epact_05.htm].)

The USTCA authorizes the appropriation of $155 million annually for FY2006
through FY2011 from the LUST Trust Fund for states to use to implement the new UST
leak prevention requirements and to administer state programs. However, the energy act’s
tax extension language (§1362) prohibited the use of trust fund appropriations for any
7 U.S. GAO, Environmental Protection: Improved Inspections and Enforcement Would Better
Ensure the Safety of Underground Storage Tanks, GAO-01-464, May 2001, pp. 2-6. Also see
Environmental Protection: More Complete Data and Continued Emphasis on Leak Prevention
Could Improve EPA’s Underground Storage Tank Program, GAO-06-45, Nov. 2005.

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new purposes. Thus, while the Energy Policy Act greatly expanded state responsibilities,
it prohibited the use of LUST Trust Fund money to support implementation of these
mandates. To address this issue, Congress amended the Internal Revenue Code to allow
the trust fund to be used for the new purposes (P.L. 109-433, H.R. 6131).

The USTCA also includes new authorizations of appropriations to hasten the cleanup
of leaking tanks and related MTBE contamination. It authorizes trust fund appropriations
of $200 million annually for FY2006 through FY2011 for EPA and states to administer
the LUST corrective action program, and another $200 million annually for FY2006
through FY2011, specifically for addressing MTBE and other oxygenated fuels leaks
(e.g., ethanol).8 Despite program resource needs and the USTCA’s funding authority and
new mandates, no increase in Trust Fund appropriations was sought or approved for
FY2007. Similarly, the request for FY2008 is $72.5 million.
MTBE in the Energy Law. The House version of H.R. 6 included a retroactive
safe harbor provision to protect manufacturers and distributors of fuels containing MTBE
or renewable fuels from product liability claims.9 This provision was opposed by water
utilities, local government associations, and many states. Opponents argued that providing
a products liability shield would effectively leave gas station owners liable for cleanup,
and as these businesses often have few resources, the effect of the provision would have
been that the burden for cleanup would fall to local communities, water utilities, and the
states. Proponents argued that a safe harbor was merited because the additive was used
heavily to meet federal clean air mandates. They further argued that the focus should be
placed on preventing leaks from USTs, which have been the primary source of MTBE
contamination.10 Conferees dropped the provision and added language allowing new
MTBE legal actions to be removed to federal courts. Conferees also dropped the MTBE
ban. As agreed to by both chambers, P.L. 109-58 repealed the Clean Air Act requirement
that prompted the increased use of MTBE. The law also requires the national gas supply
to contain a specified amount of renewable fuel, which is primarily ethanol to date.
The 110th Congress. Underground storage tank issues continue to receive
congressional attention. A key concern involves the level of resources available to states
to meet the new USTCA mandates, and some stakeholders and Members of Congress are
calling for LUST Trust Fund appropriations above the $72.5 million requested for
FY2008. In addition, the energy law’s renewable fuel mandate, and broad interest in
increasing the use of such fuels, may present new technical issues for USTs and for fuel
storage and delivery infrastructure generally. Ethanol, for example, is more corrosive than
gasoline and may increase the risk of leaks in tank systems. In February, the House
passed H.R. 547 (H.Rept. 110-7) to require EPA to establish a program to research and
develop materials that could be added to biofuels to make them more compatible with
existing infrastructure used to store and deliver petroleum-based fuels.
8 Technical corrections to the Energy Policy Act, enacted in P.L. 109-168, revised the dates
authorizing appropriations for Subtitle I from FY2005-FY2009 to FY2006-FY2011.
9 For a discussion of legal issues, see CRS Report RS21676, The Safe Harbor Provision for
Methyl Tertiary Butyl Ether (MTBE), by Aaron Flynn.
10 For more information on LUST and MTBE provisions in P.L. 109-58, see CRS Report
RL32865, Renewable Fuels and MTBE: A Comparison of Selected Provisions in the Energy
Policy Act of 2005 (P.L. 109-58 and H.R. 6), by Brent D. Yacobucci et al.

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