Underground Storage Tanks (USTs)

Quick Takeaways

Corrosion is the most common reason for leaks
Improper installation is another cause of leaks
External damage from construction activities or natural disasters may also cause leaks

Source: Top Causes of Underground Storage Tank Leaks (Environmental Works, Jan. 17, 2023)

Until the mid-1980s most underground storage tanks (USTs) were made of bare steel, which is likely to corrode over time and allow UST contents to leak into the environment. The greatest potential hazard from a leaking UST is that its contents (petroleum or other hazardous substances) can seep into the soil and contaminate groundwater, the source of drinking water for nearly half of all Americans. Owners of USTs must comply with strict regulations regarding installation, monitoring, maintenance, and closure of tanks. Non-compliance can result in fines and penalties.

The EPA keeps track of underground storage tanks performance measures, such as cleanups and inspections. Removing and disposing of old tanks is a complex process that a lot of home buyers do not want to undertake. For that reason, many REALTORS® recommend removing them before sale.

Overall, the impact of USTs on property value hinges on their condition, compliance with regulations, environmental risk, and market perception. Well-managed USTs can add value, but those with issues or liabilities can decrease property value significantly.

See References for more information.

References

NAR Library & Archives has already done the research for you. References (formerly Field Guides) offer links to articles, eBooks, websites, statistics, and more to provide a comprehensive overview of perspectives. EBSCO articles (E) are available only to NAR members and require a password.

An underground storage tank system (UST) is a tank and any underground piping connected to the tank that has at least 10 percent of its combined volume underground. . . Nearly all USTs regulated by the underground storage tank requirements contain petroleum.

What is a UST? (U.S. Environmental Protection Agency)

Facts About USTs

537,706 active USTs at approximately 193,000 facilities regulated by EPA’s UST program
86,713 total on-site inspections at federally-regulated UST facilities
6,536 (including 13 in Indian country) cleanups completed •cumulative since 1984 inception of the program = 509,091

Semiannual Report of UST Performance Measures End of Fiscal Year 2023pdf (U.S. Environmental Protection Agency, Nov. 21, 2023)

The Basics of Underground Storage Tanks

Leaking Underground Storage Tanks 101 (BuildingMetrix, Feb. 21, 2023)

When harmful substances stored within USTs begin to leak, they seep into the soil and groundwater, contaminating the adjacent environment and groundwater. Millions of people rely on groundwater for drinking in communities around the country. Contaminated water can cause serious adverse health effects, including cancer, organ damage, and developmental problems in children.

What You Need to Know About Underground Oil Tanks (Family Handyman, Apr. 26, 2023)

“Many Realtors will advise clients to remove an underground oil tank before listing, because most buyers won’t take on the risk.”

Top Causes of Underground Storage Tank Leaks (Environmental Works, Jan. 17, 2023)

One of the most common causes of UST leaks is corrosion of the tank and related piping. Corrosion can occur due to a variety of factors, from the chemical makeup of the stored material to the pH level of the surrounding soil to the presence of water in the tank.

How to Remove/Dispose Your Old Oil Tank (Dandelion Energy, Dec. 2, 2022)

While the cost of excavating an underground storage tank varies depending on the degree of contamination and your local clean-up standards, the EPA estimates that UST removal will run you anywhere from $10,000 to over $1 million, with an average cost of $130,000.

As a Real Estate Agent, What Should I Know About Underground Tanks? (GreenTrax, Inc., Jul. 27, 2020)

“It is better for all parties to REMOVE the tank instead of ABANDONING the underground tanks. It is usually always CHEAPER to REMOVE the tank instead of ABANDONING underground storage tanks”

The Influence of Leaking Underground Storage Tanks on Nearby House Values (Journal of Economic Insight, Jan. 1, 2018) E

“Households living near (within 'A mile of) exactly one LUST have a weakly significant (willingness-to-pay) premium to live even farther away from the LUST. Lastly, households living more than 'A mile from a LUST are willing to pay a statistically significant premium to live even farther away from it.

Insurance & Liability Issues

Underground Storage Tank Liability Insurance Update (Hylant, Jan. 10, 2024)

Many tank owners have other pollution exposures. Longer-term site-wide policies now cover a large percentage of USTs. Tank exposures can typically be underwritten into a site pollution policy (a comprehensive program that addresses site-wide pollution exposures) at a cost that can be relatively competitive on an annualized basis within a three-year program term. This also eliminates the time-consuming annual renewal process.

List of Insurance Providers For UST Financial Responsibility Requirements (U.S. Environmental Protection Agency)

“EPA compiled this list of insurance providers based on information we received from them. UST owners and operators may find that these providers can help you obtain UST insurance that fulfills your financial responsibility obligation. “

Leaking UST Cleanup Enforcement Tools (U.S. Environmental Protection Agency)

“EPA may take administrative or judicial enforcement action against an owner and/or operator of an underground storage tank (UST) from which there is a release. Whether the enforcement action is administrative or judicial depends on the circumstances surrounding the release and the authority that EPA relies on to address the contamination caused by the release.”

Government & Non-Profit Organizations

Many U.S. states have environmental departments or commissions. These departments can be a great source of information on state specific compliance and disclosure requirements.

National Center for Environmental Health (Centers for Disease Control and Prevention)

Regional Offices Around the Nation (U.S. Department of the Environment)

Health and Environmental Agencies of U.S. States and Territories (U.S. Department of the Environment)

U.S. Environmental Protection Agency, Office of Underground Storage Tanks
Mailing Address:
U.S. EPA/Office of Underground Storage Tanks
1200 Pennsylvania Avenue, N.W.
Mail Code: 5401T
Washington, DC 20460

Street Address:
U.S. EPA/Office of Underground Storage Tanks
William Jefferson Clinton West Building (WJC West)
1301 Pennsylvania Avenue, N.W.
1st Floor; Suite 1215
Washington, DC 20004

(202) 564-0663

Environmental Council of the States (A Non-Profit Association of State and Territorial Environmental Agency Leaders)

The Environmental Council of the States
1250 H Street NW
Suite 850
Washington, DC 20005

202-266-4920

The Groundwater Foundation (A Non-Profit, Non-Government Affiliated Organization)

601 Dempsey Road

Westerville OH 43081

Toll Free 1-800-858-4844

Phone 614-898-7791

info@groundwater.org

eBooks & Other Resources

eBooks.realtor.org

The following eBooks and digital audiobooks are available to NAR members:

Complete Book of Insurance (eBook)

How to Insure Your Home (eBook)

Land Use Law for Sustainable Development (eBook)

Pollution & Property (eBook)

Books, Videos, Research Reports & More

As a member benefit, the following resources and more are available for loan through the NAR Library. Items will be mailed directly to you or made available for pickup at the REALTOR® Building in Chicago.

Green Building and Sustainable Development: The Practical Legal Guide (Chicago, IL: American Bar Association, 2009) KF5505 .G735 2009

The Effect of Underground Storage Tanks on Residential Property Values in Cuyahoga County, Ohio (Ohio, 1994) NAC 1565 Oh3

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