Oil Spills and Six-Figure Fines: A Primer for Co-ops and Condos

If you don't? There's a hearing process, which you have a right to avail yourself to. Whatever you do, don't ignore notices by the New York State Department of Environmental Conservation (DEC), the pertinent regulatory agency. Civil penalties reach up to $25,000 for each day of a violation. Criminal penalties reach likewise, with the additional of a possible one-year imprisonment for a first offense. The maximum fine and time each double when you're talking second offense.

So pay attention: Here are some basics that every co-op or condo board should know, followed by what to do when you have a spill.

Tank You Very Much

First of all, make sure your existing oil tank is registered with the DEC, which has to be done every five years. It's like a car registration that way; you don't get a notice in the mail, but you still have to do it. Whether you have an underground storage tank (UST) or an aboveground storage tanks (AST), you're only required to register it if your tank (or your group of tanks) holds more than 1,100 gallons of oil. Unless you've a very small building, chances are you fall in that category. The registration fee is nominal, ranging from $100 to $500 per building, depending on capacity.

For such tanks, the rules — Article 17, Title 10, of the Environmental Conservation Law, entitled "Control of the Bulk Storage of Petroleum" — specify that your tank has to meet certain handling and storage requirements that include color coding of fill ports, shutoff valves, gauges and check valves. As well, aboveground tanks of this size have to have a secondary containment to help catch and contain spills, and every 10 years you have to clean out your tank, remove sludge from the bottom, inspect for structural integrity and do a "tightness test" to check for leaks.

With underground tanks of this size, you have to keep daily inventory records, reconciling them every 10 days and maintaining them for five years, and do a tightness test every five years (or, with double-walled tanks, monitor the interstitial space). With USTs, as well, you have to notify the DEC within 48 hours of unexplained inventory losses, which is a standard way of determining whether your tank is leaking.

Newly installed tanks have their own separate requirements. We're just talking here about existing tanks. And the laws are complex enough that it's always good to have an attorney with environmental-law background give your compliance procedures the once-over, especially in light of the April 2009 changes to the Petroleum Bulk Storage (PBS) Program.

Leak Soup

How do you tell if you have a leak? Sandy Sternig, president and CEO of VTEQ, a major environmental firm based in Bayport, N.Y., says that with aboveground tanks, "You will see if there's a leak if there is wetness along the side of the tank, or if you see a puddle. In that particular case you can throw Speedy Dry on it; cap the piping, if that's an issue; or get the tank repaired if it's not too badly corroded. Aboveground is fairly simple."

With underground tanks, not surprisingly, a leak is harder to determine. "Unfortunately you generally do not know you have a problem," Sternig says. When do you find a problem? "You go through more oil than you generally account for. Of course, somebody has to know if you've been going through a thousand gallons a month and now you're going through 1,500 or 2,000 gallons a month." There are alarm or monitoring systems that look for leaks, which commercial venues such as gas stations typically employ, but with co-ops, says Sternig, "Ninety percent of the tanks are old, and 90 percent of co-ops don't want to spend the money" on alarms.

Oil spillage can also happen when you're getting a fuel-oil delivery, notes Paul J. Herman, president of Brown Harris Stevens Residential Management. "It's typically not a leak," he says. "Usually it's the supplier, when they're doing the fill. Sometimes the fill line breaks and the gauge doesn't work and they overfill the tank." When that occurs, he says, "You go to your supplier and say, 'Hey, this happened.' Sometimes it's mitigated right away, because they'll bring in the [cleanup] people, since they bear some responsibility."

All Hands on DEC

Any oil spill (also called a leak or a discharge, interchangeably) has tp be reported to the New York State Spill Hotline (800-457-7362) within two hours of discovery, except those that meet all of the following criteria:

1. The quantity is known to be less than five gallons; and
2. The spill is contained and under the control of the spiller; and
3. The spill has not and will not reach the State's water or any land; and
4. The spill is cleaned up within two hours of discovery.

The State considers a spill not to have impacted land if it occurs on a paved surface such as asphalt or concrete. So, a spill in a dirt basement is considered to be on impacted land and has to be reported. You can find a web page with details on the DEC's Spill Response & Remediation FAQ page, but it's best to get there via our link, since trying to find it either by navigation or the DEC's search function on its ridiculously convoluted site is difficult at best.

This holds equally true for the department's Guide to Enforcement Hearings, which spells out your rights and options when the DEC serves you with a formal complaint.

Hopefully, it won't come to that. Just remember: The oily board gets the worm. Or something.