Posted by: Robin Gronsky | December 20, 2011

Underground Oil Storage Tanks – NJ is Out of Money to Help You

If you are a homeowner and you heat your house with oil, it’s more likely than not that the oil tank is buried somewhere on your property.  This has become a problem as the oil tanks get old and rusty and then leak oil into the soil on your property.  Sometimes the oil also gets into the common water supply or into your neighbor’s soil.  If your oil tank has leaked, it is your responsibility to clean up any contamination that you have created.

 

If you are “lucky”, your oil tank has never leaked.  Removal of the oil tank will cost you a few thousand dollars.  The expensive problems come when the oil tank has contaminated the soil and the soil must be removed.  The costs can climb sky-high.  $20,000 is not unheard of, even $100,000 is not unheard of.  Once upon a time, your homeowners’ insurance policy covered the costs of removal of the tank and the removal of any contaminated soil.  About six (6) years ago, insurance policies stopped covering these problems as the costs were getting too high.

New Jersey created the Petroleum Underground Storage Remediation, Upgrade and Closure Fund (the Fund) to help homeowners with the costs  of removing the underground oil tank and remediating the soil.  In May, 2011, the Fund ran out of money.  Even if you submitted your application to the Fund, it will not be review or processed until the Legislature votes to add new money to the Fund.  If you submit an application for reimbursement from the Fund, it will be date stamped and held until more funding becomes available for this program.

If you are a homeowner, be aware that very few buyers will agree to buy a property that has an underground oil storage tank.  Even if you had it decommissioned and filled with sand several years ago, nowadays buyers will insist that you have that tank removed and tested.  Even decommissioned tanks have a small residue of oil left at the bottom which can leak out and contaminate the environment.  If your insurance policy still has coverage for oil tank removal and clean-up, make the claim before that type of coverage is totally eliminated.  If you don’t have that type of coverage, call around to find out if there are any insurance policies still out there that you can qualify for.  Many oil tank removal companies know where such insurance can be obtained.  Submit an application to the Fund.  Even though there is no fund at present, if the Legislature ever agrees to add more money to the Fund, your application will already be in and ready for processing.  Be aware that the Fund is anticipating a two-year wait just to pay for existing applications.  Nor is there any guarantee that the Legislature will ever vote for new funding.

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Responses

  1. Oil tank removal plays a vital role when it comes to safeguarding the humans and environment. The task of removing an oil tank should always be executed with the help of professionals.

    oil tank removal MA


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