23-37 Petroleum Release Remediation
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against the fund.23-37-02. Definitions. As used in this chapter, unless the context otherwise requires:1."Actually incurred" means, in the case of corrective action expenditures, that the
owner, the operator, the landowner, an insurer, or a contractor hired by the owner,
operator, or the landlord has expended time and materials and that only that person
is receiving reimbursement from the fund.2."Administrator" means the manager of the state fire and tornado fund.3."Board" means the petroleum release compensation board.4."Commissioner" means the insurance commissioner.5."Corrective action" means an action required by the department to minimize,
contain, eliminate, remediate, mitigate, or clean up a release, including any remedial
emergency measures.The term does not include the repair or replacement ofequipment or preconstructed property.6."Dealer" means any person licensed by the tax commissioner to sell motor vehicle
fuel or special fuels within the state.7."Department" means the state department of health.8."Fund" means the petroleum release compensation fund.9."Location" means a physical address or site that has contiguous properties.
Noncontiguous properties within a municipality or other governmental jurisdiction are
considered separate locations.10."Operator" means any person in control of, or having responsibility for, the daily
operation of a tank under this chapter.11."Owner" means any person who holds title to, controls, or possesses an interest in
the tank before the discontinuation of its use.12."Person" means an individual, trust, firm, joint stock company, federal agency,
corporation, state, municipality, commission, political subdivision of a state, or any
interstate body. The term also includes a consortium, a joint venture, a commercial
entity, and the United States government.13."Petroleum" means any of the following:a.Gasoline and petroleum products as defined in chapter 19-10.b.Constituents of gasoline and fuel oil under subdivision a.c.Oil sludge and oil refuse.Page No. 114."Portable tank" means a storage tank along with its piping and wiring that is not
stationary or affixed, including a tank that is on skids.15."Release" means any unintentional spilling, leaking, emitting, discharging, escaping,
leaching, or disposing of petroleum from a tank into the environment whether
occurring before or after the effective date of this chapter, but does not include
discharges or designed venting allowed under federal or state law or under adopted
rules.16."Tank" means any one or a combination of containers, vessels, and enclosures,
whether aboveground or underground, including associated piping or appurtenances
used to contain an accumulation of petroleum. The term does not include:a.Tanks owned by the federal government.b.Tanks used for the transportation of petroleum.c.A pipeline facility, including gathering lines, regulated under:(1)The Natural Gas Pipeline Safety Act of 1968.(2)The Hazardous Liquid Pipeline Safety Act of 1979.(3)An interstate pipeline facility regulated under state laws comparable to
the provisions of law in paragraph 1 or 2.d.An underground farm or residential tank with a capacity of one thousand one
hundred gallons [4163.94 liters] or less or an aboveground farm or residential
tank of any capacity used for storing motor fuel for noncommercial purposes.
However, the owner of an aboveground farm or residential tank may, upon
application, register the tank and be eligible for reimbursement under this
chapter.e.A tank used for storing heating oil for consumptive use on the premises where
stored.f.A surface impoundment, pit, pond, or lagoon.g.A flowthrough process tank.h.A liquid trap or associated gathering lines directly related to oil or gas
production or gathering operations.i.A storage tank situated in an underground area such as a basement, cellar,
mine working, drift, shaft, or tunnel if the storage tank is situated upon or above
the surface of the floor.j.A tank used for the storage of propane.k.A tank used to fuel rail locomotives or surface coal mining equipment.l.An aboveground tank used to feed diesel fuel generators. Upon application,
the owner or operator of an aboveground tank used to feed diesel fuel
generators may register the tank and is eligible for reimbursement under this
chapter.m.A portable tank.Page No. 2n.A tank with a capacity under one thousand three hundred twenty gallons
[4996.728 liters] used to store lubricating oil.17."Tank integrity test" means a test to determine that a tank is sound and not leaking.
For an underground tank, the term means a certified third-party test that meets
environmental protection agency leak detection requirements. For an aboveground
tank, the term means a test conducted according to steel tank institute SP 001 or
American petroleum institute 653.18."Third party" means a person who is damaged by the act of a registered owner,
operator, or dealer requiring corrective action or a person who suffers bodily injury or
property damage caused by a petroleum release.23-37-03.Petroleum release compensation board.The petroleum releasecompensation advisory board consists of five members appointed by the governor, three of
whom are active in petroleum marketing, one of whom is active in the petroleum, crude oil, or
refining industry, and one of whom is active in the insurance industry.A member active inpetroleum marketing must be appointed from a list of three recommended by the North Dakota
retail petroleum marketers association. A member active in the petroleum, crude oil, or refining
industry must be appointed from a list of three recommended by the North Dakota petroleum
council.A member active in the insurance industry must be appointed from a list of threerecommended by the North Dakota professional insurance agents association. Members must
be appointed to terms of three years with the terms arranged so that the term of at least one
member, but no more than two members, expires June thirtieth of each year. A member shall
hold office until a successor is duly appointed and qualified.Each member of the board isentitled to receive sixty-two dollars and fifty cents per diem for each day actually spent in the
performance of official duties, plus mileage and expenses as are allowed to other state officers.23-37-04. Administration of fund - Staff. The administrator shall administer the fundaccording to this chapter. The administrator shall convene the board as may be necessary to
keep the board apprised of the fund's general operations. However, the board shall meet at least
once each half of each calendar year to review and to advise the administrator regarding the
administration of the fund, the fund's general operations, and to hear and decide denials of
claims by the administrator which may be appealed to the board, and to discuss all claims
against the fund.The administrator may employ any assistance and staff necessary toadminister the fund within the limits of legislative appropriation.A claimant aggrieved by adecision of the administrator regarding a claim upon the fund may appeal the decision to the
board.The board may sustain, modify, or reverse the decision of the administrator.Theclaimant or the administrator may appeal the board's decision to the commissioner. The decision
of the commissioner may be appealed under chapter 28-32.23-37-05.Adoption of rules.The administrator shall adopt rules regarding thepractices and procedures of the fund, the form and procedure for applications for compensation
from the fund, procedures for investigation of claims, procedures for determining the amount and
type of costs that are eligible for reimbursement from the fund, procedures for persons to perform
services for the fund, procedures for appeals to the board by claimants aggrieved by an adverse
decision of the administrator, and any other rules as may be appropriate to administer this
chapter.23-37-06. Release discovery. If the department has reason to believe a release hasoccurred, it shall notify the administrator. The department shall direct the owner or operator to
take reasonable and necessary corrective actions as provided under federal or state law or under
adopted rules.23-37-07. Owner or operator not identified. The department may cause legal action tobe brought to compel performance of a corrective action if an identified owner or operator fails or
refuses to comply with an order of the department, or the department may engage the services of
qualified contractors for performance of a corrective action if an owner or operator cannot be
identified.Page No. 323-37-08. Imminent hazard. Upon receipt of information that a petroleum release hasoccurred which may present an imminent or substantial endangerment of health or the
environment, the department may take such emergency action as it determines necessary to
protect health or the environment.23-37-09. Duty to notify. This chapter does not limit any person's duty to notify thedepartment and to take action related to a release. However, payment for corrective actions
required as a result of a petroleum release is governed by this chapter.23-37-10.Providing of information.Any person whom the administrator or thedepartment has reason to believe is an owner or operator, the owner of real property where
corrective action is ordered to be taken, or any person who may have information concerning a
release shall, if requested by the administrator or the department, or any member, employee, or
agent of the administrator or the department, furnish to the administrator or the department any
information that person has or may reasonably obtain that is relevant to the release.23-37-11.Examination of records.Any employee of the administrator or thedepartment may, upon presentation of official credentials:1.Examine and copy books, papers, records, memoranda, or data of any person who
has a duty to provide information to the administrator or the department under
section 23-37-10; and2.Enter upon public or private property for the purpose of taking action authorized by
this section, including obtaining information from any person who has a duty to
providetheinformationundersection23-37-10,conductingsurveysandinvestigations, and taking corrective action.23-37-12. Responsibility for cost. The owner or operator is liable for the cost of thecorrective action required by the department, including the cost of investigating the releases.
This chapter does not create any new cause of action for damages on behalf of third parties for
release of petroleum products against the fund or licensed dealers.23-37-13. Liability avoided. No owner or operator may avoid liability by means of aconveyance of any right, title, or interest in real property or by any indemnification, hold harmless
agreement, or similar agreement. However, this chapter does not:1.Prohibit a person who may be liable from entering into an agreement by which the
person is insured or is a member of a risk retention group, and is thereby
indemnified for part or all of the liability;2.Prohibit the enforcement of an insurance, hold harmless, or indemnification
agreement; or3.Bar a claim for relief brought by a person who may be liable or by an insurer or
guarantor, whether by right of subrogation or otherwise.23-37-14. Other remedies. This chapter does not limit the powers of the administratoror department, or preclude the pursuit of any other administrative, civil, injunctive, or criminal
remedies by the administrator or department or any other person. Administrative remedies need
not be exhausted in order to proceed under this chapter. The remedies provided by this chapter
are in addition to those provided under existing statutory or common law.23-37-15. Revenue to the fund. Revenue from the following sources must be depositedin the state treasury and credited to the fund:1.Any registration fees collected under section 23-37-17;Page No. 42.Any money recovered by the fund under section 23-37-23, and any money paid
under an agreement, stipulation, or settlement;3.Any interest attributable to investment of money in the fund; and4.Anymoneyreceivedbytheadministrator in the form of gifts, grants,reimbursements, or appropriations from any source intended to be used for the
purposes of the fund.23-37-16.Penalty.A tank owner violating section 23-37-17 is guilty of a class Bmisdemeanor unless another penalty is specifically provided.23-37-17. Registration fee.1.An owner or operator of a tank shall pay an annual registration fee of fifty dollars for
each aboveground or underground tank owned or operated by that person. If on the
first day of July in any year the amount of money in the petroleum release
compensation fund is less than six million dollars, the annual registration fee of fifty
dollars is increased to one hundred dollars. If on the first day of July in any year the
amount of money in the petroleum release compensation fund is five million five
hundred thousand dollars or more and the annual registration fee has been
increased to one hundred dollars, the fee must be reduced to fifty dollars. Annual
registration fees must be reduced to five dollars if on the first day of July in any year
the amount of money in the fund exceeds nine million dollars. Annual registration
fees must continue at the fee of five dollars until the money in the fund does not
exceed nine million dollars.2.An owner or operator of an existing tank that is discovered at a location that currently
and previously has had tanks registered with the fund on or before July 1, 2007,
shall pay seventy-five dollars for each aboveground tank and one hundred
twenty-five dollars for each underground tank owned or operated by that person for
each previous year that the tank was required to be registered for which a fee was
not paid. The payment includes the fees and the penalty for the failure to register.3.An owner or operator of an existing tank at a location that was not previously and
continuously registered with the fund, whether the registration was required by law or
not, on or before July 1, 2007, must provide the fund with a phase two environmental
study conducted by a qualified firm according to American society for testing
materials standards.A tank integrity test must also be performed.Theenvironmental study and tank integrity test must be reviewed by the commissioner
along with the application for registration with the fund. If the commissioner rejects
the application, the applicant is denied eligibility to the fund. However, if the site is
remediated and the leaking tank is replaced, the applicant may reapply for
registration with the fund. A new installation that is using a used tank must provide
tank integrity test results for the used tank.Use of a synthetic liner in anaboveground dike system negates the need for a tank integrity test. The owner or
operator of a new tank at a new site or a new tank at an existing site that had a tank
registered at the site previously need only pay the required fees for registration with
the fund.4.If accepted for registration with the fund, the owner or operator of the tank shall pay
seventy-five dollars for each aboveground tank and one hundred twenty-five dollars
for an underground tank for each underground tank for each previous year that the
tank was required to be registered for which a fee was not paid, regardless of
ownership in each of those years.5.The registration fees collected under this section must be paid to the fund
administrator for deposit in the state treasury for the dedicated credit to the
petroleum release compensation fund.Page No. 523-37-18. Reimbursement for corrective action.1.The administrator shall reimburse an eligible owner or operator for ninety percent of
the costs of corrective action, including the investigation, which are greater than five
thousand dollars and less than one million dollars per occurrence and two million
dollars in the aggregate. An eligible tank owner or operator may not be liable for
more than twenty thousand dollars out-of-pocket expenses for any one release. A
reimbursement may not be made unless the administrator determines that:a.At the time the release was discovered the owner or operator and the tank were
in compliance with state and federal rules and rules applicable to the tank,
including rules relating to financial responsibility which were in effect at the time
of the release;b.The department was given notice of the release as required by federal and
state law;c.The owner or operator has paid the first five thousand dollars of the cost of
corrective action; andd.The owner or operator, to the extent possible, fully cooperated with the
department and the administrator in responding to the release.2.The fund shall compensate third parties for corrective action taken for a petroleum
release if the provisions of subdivisions a, b, c, and d of subsection 1 were met at
the time the release was discovered. Compensation for third-party corrective action
includes compensation for costs incurred in returning the real estate to that level
deemed duly remediated by the department.3.The fund shall reimburse the tank owner, operator, or dealer for bodily injuries to a
third party caused by a petroleum release if the provisions of subdivisions a, b, c,
and d of subsection 1 were met at the time the release was discovered in an amount
determined by:a.Findings reduced to judgment in federal or state district court within the state of
North Dakota or such other court having jurisdiction over the matter in a
proceeding in which the fund has been made a party;b.Findings by an arbitration panel agreed upon in writing by the parties in a
proceeding in which the fund has been made a party; orc.A written settlement entered into by the parties in which the commissioner or
the commissioner's agent has participated. The settlement must be reviewed
and approved by the commissioner.4.In any civil action against the owner, operator, or dealer for damages resulting from
a petroleum release, if the pre-leak condition of real estate is an issue and if there is
no reasonable means of determining the pre-leak condition of real estate, the
condition is that which exists at the time the department determines the real estate
has been duly remediated.5.The fund may not compensate for attorney's fees of owners, operators, or dealers,
nor may the fund compensate for exemplary damages, criminal fines, or
administrative penalties.6.A third party accepting monetary compensation directly from the fund for damages
due to a release caused by a tank owner, operator, or dealer covered by the fund is
deemed to have waived any cause of action against the fund or against the tank
owner, operator, or dealer.Page No. 67.The fund shall reimburse the department for all costs, attorney's fees, and other
legal expenses relating to administrative and adjudicative proceedings under this
chapter and any subsequent legal proceeding. Any monies reimbursed must be
deposited in the department's operating fund in the state treasury and must be spent
subject to appropriation by the legislative assembly.23-37-19. Application for reimbursement. Any owner or operator who is a first-partyclaimant who proposes to take corrective action or has undertaken corrective action in response
to a release, the time of such release being unknown, may apply to the administrator for partial or
full reimbursement under section 23-37-18. An owner or operator who is a first-party claimant
may be reimbursed only for costs incurred after July 1, 1989, even if the releases were
discovered before July 1, 1989, up to the maximum of twenty-five thousand dollars per location.23-37-20. Administrator to determine costs. A reimbursement for corrective actionstaken by an owner, operator, or dealer may not be made from the fund until the administrator has
determined that the costs for which reimbursement is requested were actually incurred and were
reasonable. All necessary loss adjustment expenses must be included as a component of the
loss and must be paid out of the fund.23-37-21. Liability of responsible person. The right to apply for reimbursement andthe receipt of reimbursement does not limit the liability of an owner or operator for damages or
costs incurred as the result of a release.23-37-22. Reimbursement not subject to attachment. The amount of reimbursementto be paid for corrective action that was done by a third party is not subject to legal process or
attachment if actually paid to a third party who performed the corrective action.23-37-23. Recovery of expenses. Any reasonable and necessary expenses incurred bythe fund, which exceed the coverage limits provided by section 23-37-18, in taking a corrective
action, including costs of investigating a release, and in taking legal actions may be recovered in
a civil action in district court brought by the administrator against an owner or operator. The
certification of expenses by an approved agent of the fund is prima facie evidence that the
expenses are reasonable and necessary. Any expenses that are recovered under this section
must be deposited in the fund.23-37-24. Costs exceeding reimbursement. If the cost of any extraordinary authorizedaction under this chapter exceeds amounts awarded to the administrator or the department from
the federal government, the administrator may pay the department the cost of the corrective
actions, including the cost of investigating a release, if the board finds that the cause was a
petroleum substance, that an adequate amount exists in the fund to pay for the corrective action,
that the occurrence was extraordinary in scope and size, and that a danger to the health and
safety of citizens exists.23-37-25. Coordination of benefits. If an owner or operator has an insurance policythat provides the same coverage as the fund, the administrator of the fund shall pay the share of
the covered loss or damage for which the fund is responsible. The share that must be paid from
the fund is equal to the proportion that the applicable limit of coverage under the fund bears to
the limits of insurance of all insurance coverage on the same basis.23-37-26. Third-party damages - Participation in actions and review of settlements.1.An owner or operator who is sued for damages resulting from a release shall notify
the administrator within fourteen days of being served with a summons and
complaint. The owner or operator shall also advise the administrator if any insurer is
defending the owner or operator and provide to the administrator the name of that
insurer.2.An owner or operator who, before litigation, enters into negotiations with a third party
who claims to have been damaged by a release, or who receives a demand forPage No. 7payment of damages to a third party who claims to have been damaged by a
release, shall notify the administrator within fourteen days of the demand or the
negotiations.3.The administrator and the board shall review the conduct of any litigation or
negotiation.The administrator may not assume any legal costs incurred by thedefendant or plaintiff, but may participate in discovery, trial proceedings, or
settlement negotiations of either disputed liability or damages that bear on the
determination of a plaintiff's damages.4.The administrator and the board shall review any settlement negotiations to
determine the dollar amount of bodily injury or property damage actually,
necessarily, and reasonably incurred by third parties which, if paid by the defendant,
would be considered eligible costs.23-37-27. Third-party damages - Documentation.1.An applicant's payments for third-party damages pursuant to a judgment entered in
a court must include copies of the notice of entry of judgment and abstract of costs.2.An applicant's payments for third-party damages made by agreement in settlement
of litigation must include copies of the settlement agreement and such supporting
documents as may be required by the administrator.3.An applicant's payments for third-party damages made by agreement without
reference to litigation must include copies of the settlement and such supporting
documents as may be required by the administrator.4.The administrator and the board may require a third party who claims bodily injury to
be examined by a physician and require that the physician's report be submitted to
the administrator. The administrator may require a third party who claims property
damage to permit a property appraiser or claims adjuster retained by the
administrator to inspect the property and report to the administrator.5.The fund shall pay a judgment against an owner, operator, or dealer awarded to a
third party as a result of a third-party claim and property damage against an owner,
operator, or dealer registered by the fund.6.The fund shall pay for corrective action as awarded to a third party in any judgment
against an owner, operator, or dealer.7.Liability of the tank owner, operator, dealer, or fund to third parties for corrective
action or personal injuries and property damage may not exceed, per person, one
million dollars. Maximum liability of the fund, including all claims by third parties,
may not exceed, for any release site, the maximum provided in section 23-37-18.8.A third party may not bring an action against any owner, operator, or dealer more
than three years after a corrective action plan has been approved by the department
if the owner, operator, or dealer fully implements and complies with the corrective
action plan.9.In investigating a release site or reviewing the implementation of any corrective
action plan approved by the department, the department shall determine whether
the release currently threatens public health or the environment. The department
shall require, based on science and technology appropriate for the site, any
monitoring, remediation, or other appropriate corrective action that is reasonably
necessary to protect public health or the environment. The department may require
corrective action at a release site at any time after a release occurs.Page No. 823-37-28. Matching federal funds. The administrator and the board may annually allowthe department a ten percent matching grant for federal leaking underground storage tank funds
to be paid out of the fund if the moneys are available and the administrator and the board
determine the allowance appropriate.23-37-29. Fund appropriations. Money in the fund is continuously appropriated to theadministrator for the purpose of making reimbursements under this chapter.23-37-30. Investment of fund. Investment of the fund is under the supervision of thestate investment board in accordance with chapter 21-10. The commissioner may purchase a
contract for reinsurance of any risk to be paid by the fund. The administrator may investigate the
purchase of insurance that reimburses an owner or operator for property damage claims by third
parties other than claims for costs of corrective action.Page No. 9Document Outlinechapter 23-37 petroleum release remediation