Update on the Homeowner Heating Oil Safety Bill
By Ralph Penney, LSP, PE at Penney Engineering, Inc
All homeowners in Massachusetts should be aware that on December 29, 2008, the State Senate enacted the long-awaited Homeowner Heating Oil Safety Bill as Chapter 453 of the Acts of 2008. It required homeowners to upgrade their existing oil heat supply line and insurance companies to offer coverage for a spill by July 1, 2010. On January 5, 2009, it was signed by the Governor. On June 30, 2010, a day before it was to become effective, Governor Patrick signed an amendment to the law as Section 114 of Chapter 131 of the Acts and Resolves of 2010, which extended the requirement for homeowners to upgrade their oil heat supply lines until September 30, 2011. According to Mr. Michael Ferrante, President of the Massachusetts Oilheat Council, more time was needed to complete the upgrade on a number of the 950,000 homes in Massachusetts that heat with oil.
Heating oil companies have been sending out notices of the deadline to upgrade to their customers for a while now, but not getting many responses. Many heating systems still need to have the oil line upgraded. The oil burner code, 527 CMR 4.00, also had to be revised and a form to be used to certify an upgrade had to be prepared. The original July 1, 2010 deadline for insurance companies to offer spill coverage was not extended. However, in order to receive the coverage, a homeowner must have completed the upgrade. Many of us in the environmental field have been pushing for insurance coverage for a long time. We have seen how financially devastating a heating oil spill can be to a family. Regardless of the extension of the deadline to upgrade, a homeowner should immediately have the upgrade completed and contact their insurance carrier for spill coverage.
No. 2 heating oil must be stored in a tank. There are plastic and double-walled tanks available and underground storage tanks are still installed, but the most common tank of choice by far is a steel, single-walled, 275-gallon aboveground storage tank located either in a basement or outside. The tanks are inexpensive and prone to mechanical and physical problems. Condensate forms inside the top of a tank, above the oil, and drips down to the bottom of the tank where it forms a layer of water beneath the heating oil. The water corrodes the bare, 10-gauge (0.108") mild steel at the bottom of a tank 24/7. Rust never sleeps. The steel at the bottom of a 275-gallon tank is normally less than 1/8" thick or between the first and second line on your 1/16th graduated ruler! A penny is 1/16" thick. The corrosion causes pits to form in the steel. The pits grow and cause "weeping" through the steel at the bottom of the tank. Then a subsequent fill up increases the hydrostatic pressure at the bottom of the liquids in the tank causing a pit to become a hole. Tanks typically only last 15 to 25 years, depending upon the surrounding environment. Most homeowners do not realize that the tanks are only coated on the outside. They may look great on the outside right up to the time they leak. If the tank is more than 15 years old or badly corroded on the outside, it should be replaced. A double-walled tank with leak detection or a single-walled tank with secondary containment should be considered.
Cable installers and kids can also step on the small pipe nipples at the bottom outlet on a 275-gallon tank located in a basement or outside. The nipple breaks at the threads which causes a release of the entire contents of heating oil or frantic screams for help while the culprit holds his or her finger in the broken outlet until help arrives. It is analogues to the little Dutch boy who stuck his finger in the dike. Others just run and let the basement fill up with oil which flows across the cement floor looking for the first crack. If multiple tanks have been piped together, a broken nipple results in an even bigger mess! I have also seen the pipe legs holding a tank upright, rust to a point where one fails and the tank rolls over breaking the supply line and spilling its contents. The legs also fall off cement blocks. These two types of leg failures commonly occur on tanks that are outside, exposed to the weather.
Heating oil is normally conveyed from a tank to the burner through 1/4" soft copper tubing. Far too often the copper tubing is run through a concrete floor where it is subjected to corrosion by the cement in the concrete and the sulfates in the soil under the floor. Pinhole leaks form in the line, usually under the floor where the leak goes undetected for years. Typical cleanup costs range from $2,000 to $150,000 or more. Surveys have determined that the average cost of a cleanup in Massachusetts to be approximately $50,000.
The first objective of the Heating Oil Safety Bill was to help prevent spills by requiring relatively inexpensive upgrades to the existing lines from an aboveground heating oil tank by a licensed heating oil technician. (The oil burner code has required a sleeve and an oil safety valve on new installations since January 1, 1990.) If an oil burner is located below a tank, one option to meet the upgrade requirement is to install a diaphragm-type check or regulator valve, being called an "oil safety valve" (OSV), at the outlet on the bottom of a tank to prevent gravity leaks. The cost of an OSV is around $35. If the supply line or lines, on a two-line circulating system, are in contact with concrete, soil or a floor, the lines must be encased in a plastic sleeve to prevent corrosion. Using a new style supply line made of copper tubing with plastic cladding on the outside is an even better solution for preventing corrosion. Other approved leak prevention methods can also be used. The Bill only requires one of the three optional upgrades. I usually recommend installing both a safety valve and coated line. Whenever possible, the supply line should be run from the top of a tank with a safety valve. The lines should also be protected from physical damage. A Form 1A - Certificate of Compliance must be prepared by a technician to certify an upgrade and a copy sent to the local fire department. Some local fire departments want more involvement while others want less involvement with tanks. The cost to upgrade a line ranges from $250 to $1,000 depending upon conditions which may include cutting a concrete floor and excavating.
The second objective of the Bill and the one most important to a property owner, the entity holding the mortgage on the property, a cleanup contractor, and a Licensed Site Professional (LSP) is the requirement for insurance companies to offer coverage for a home heating oil spill. This requirement applies to insurance companies licensed to write homeowners' insurance in the Commonwealth of Massachusetts. As of July 1, 2010, insurance companies must offer the coverage to their Massachusetts residential customers. The coverage is limited to one to four-unit residential properties. The minimum limits of coverage must range from $50,000 per occurrence for first-party property liability to $200,000 per occurrence for third-party liability with a maximum deductible of $1,000 per claim. The first-party coverage applies to costs associated with personal property loses and cleanup. The third-party liability affords coverage from third-party claims and response actions conducted off the covered property. Again, the line or lines must be certified as being upgraded before a property can be insured. Section 4 of the Bill only requires insurers to make the coverage "available" to residential owners. It does not require them to promote it or notify their customers of its availability. Initially, I was only aware of AMICA including the new coverage in their homeowners' policies back in July 2010. However, the coverage did not meet the requirements of the Bill. Currently all the carriers are offering coverage. The annual premiums are approximately $40 to $75. A very small price to pay when compared to the cost for a cleanup!
I am assuming that if a bank holds the mortgage on a property, it will eventually require that the homeowner maintain Limited Escaped Liquid Fuel Liability Coverage, the same as it requires fire insurance. Will landlords and mobile park owners require their tenants to purchase the coverage? Will coverage be available to everyone someday? Will there be spills that are specifically exempt from coverage? Should the specifications for 275-gallon tanks and piping be improved?
Once the heating season is over, every homeowner in Massachusetts with oil heat should evaluate the condition of their tank and lines, meet the upgrade requirements, and seek insurance coverage. We are currently cleaning up a 350-gallon spill of kerosene from a 275-gallon tank installed outside in 1995 at 157 Mansfield Avenue in Norton. The kerosene flowed into the Norton Reservoir. If you don't think it can happen to you, just look at the pictures and the related article from the Sun Chronicle on our Featured Projects page.
PROPERTY ASSESSMENTS IN MASSACHUSETTS
January 2013 - The commercial real estate market in Massachusetts is finally coming back. Businesses seem to be doing better or at least they are beginning to see an end to the great recession! Many owners are considering relocating or expanding.
Most buyers of commercial property and their lenders will require a 21E-type environmental assessment. The buyers do not want to purchase a contaminated property. The lenders do not want to hold a mortgage on a property that may require an expensive cleanup or has a cleanup lien placed on it that is above their mortgage. There are still no state regulatory requirements to conduct a property assessment. It is strictly a requirement of a buyer, lender or sometimes a seller.
Previously in Massachusetts, each lender had its own requirements for conducting a “21E.” We had to know the lender that was financing the land purchase so that we could conduct an assessment to meet its standards. In May 1993, the American Society for Testing and Material (ASTM) got involved and established national standards for conducting transaction screenings and property assessments. A list of standard questions was created. The questions are asked of the property owner and/or tenant during a transaction screening to determine if there are “any recognized environmental conditions” or “potential environmental concerns.” The old 21E paper study assessment has become an “ASTM Phase I Environmental Property Assessment (ASTM Phase I).” If soil or groundwater sampling is conducted, it is referred to as an “ASTM Phase II Environmental Property Assessment (ASTM Phase II).”
To make it even more confusing, the Massachusetts Department of Environmental Protection (“the DEP”) has regulations that refer to a “Phase I - Initial Site Investigation” and a “Phase II - Comprehensive Site Assessment.” These types of investigations are required by the DEP at a property suspected or known to be contaminated. They must be conducted in accordance with 310 CMR 40.0000, the “Massachusetts Contingency Plan” or “MCP.” Some lenders accept these DEP reports, but most do not understand them and require an ASTM report.
In 2006, Congress also got involved with property assessments when it promulgated the Final All Appropriate Inquiries (AAI) Standard. For the first time since the 1980 enactment of Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA or Superfund), where new property owners were also held responsible for the contamination caused by others under the “strict liability” concept, an entity could knowingly purchase a contaminated property without being held liable for the required cleanup. In order to claim such protection from liability, the purchasing entity had to make “all appropriate inquiries” as to the prior ownership and use of the property as well as the potential for contamination and other requirements. Basically, a potential buyer had to fully understand the nature and the extent of contamination before buying a property with his or her eyes wide open.
As a multi-disciplined environmental company, Penney Engineering routinely conducts property assessments in accordance with the scope of the current ASTM Phase I and Phase II – Environmental Property Assessment Standards and the requirements of the All Appropriate Inquiries Standard at commercial and industrial properties in Massachusetts. We have sometimes even conducted assessments at residential properties. We also conduct Transaction Screening in accordance with the scope of the ASTM standard E1528. Sometimes a simple Transaction Screening is all that is needed. We continually keep our clients informed of our progress, discuss our findings as we proceed, and answer questions as they arise. We meet closing dates and maintain budgets. We economically dispose of hazardous materials left behind by former tenants or owners. We also remove debris and trash from properties.
CHANGING THE CLASSIFICATION OF THE GROUNDWATER IN VINEYARD HAVEN HELPS EVERYONE
In 2001, Penney Engineering began working on two sites in Vineyard Haven on Martha's Vineyard. We quickly realized there was an insurmountable problem. The groundwater under the entire area was classified as a potential drinking water resource area. The classification required soil and groundwater cleanups to achieve the drinking water standards, which is often an impossible goal for an unfortunate property owner. Not only was the groundwater brackish, but it was contaminated from over 300 years of urban development/commercial use. There were numerous, co-mingled contaminant plumes from unknown sources. We brought our concerns to the Massachusetts DEP staff and they agreed. We discussed the situation with the Tisbury Water Commissioners and were told that they had no intention to ever use the groundwater under Vineyard Haven as a source of drinking water. In 2010, we petitioned the DEP to reclassify the groundwater as a non-potential drinking water source area (NPDWSA). In September 2012, the DEP reclassified the groundwater under 114 acres of Vineyard Haven to be a NPDWSA. You'll find the DEP map of the NPDWSA and two articles about the reclassification below. Suddenly, cleaning up and closing a site in Vineyard Haven got a whole lot easier for everyone.
Article printed in the Vineyard Gazette, Tuesday, June 9, 2009:
Arcane Groundwater Problem Plagues Commercial District
By MIKE SECCOMBE
It was in 1995, when new storm water drains were being put in along the Beach Street Extension in Vineyard Haven, that Eric Anderson first learned of the serious contamination of the groundwater under his property. He and several other landholders in the area were required by state environmental authorities to begin an extensive program of sampling to find out the source of the pollution, with a view to remediation.
Thirteen years and hundreds of thousands of dollars later, there is no realistic plan for remediation; indeed the source of the problem has not been determined. "The more we studied it," said Mr. Anderson yesterday, "the more we found out it could be coming from almost anywhere. "Over the past 100 or 150 years that area, the central commercial area of Vineyard Haven, has been a site for numerous underground storage tanks, everything from gasoline to diesel fuel to kerosene to mineral spirits to range oil to whatever. And all or some of those tanks had leaked over a long period of time. "Plus the whole area is filled with dredge spoils and has brackish water, which contributes to corrosion of metal."
Mr. Anderson's problem, and the problem for other landholders, is that the water in the ground under them is designated as a potential source of drinking water. Which leaves them on a legal hook. "Anybody who has any sort of hazardous waste on a property faces a problem if they want to sell it, and are on the Massachusetts list as a responsible party for it," he said. "And people are very reticent to provide financing because one day the party may be required under a state regulation to address a cleanup. "It is now clear, though, that a full cleanup is essentially impossible, he said. The contamination is widespread and no respecter of property lines. It extends under all of the waterfront, much of the commercial area in town. Clean up one site and the likelihood is that it would simply seep back from adjoining areas.
As Mr. Anderson said, regarding the contamination of his own sites on Beach Road and the Beach Street Extension: "Some of it could have happened on the property itself, or come from the other properties or from storm drains which picked it up in other parts of town and then leaked."
This is not just the opinion of a layman, either. It also is that of the engineers, Penney Engineering Inc. of Mansfield, who have worked with Mr. Anderson over the years, and who now have written a number of other property owners in the area, warning them they may be unable to sell or refinance if the problem is not addressed. "Hundreds of thousands of dollars have been spent to date without any resolution," their letter says."It would take millions of dollars to remove the historical buildings, de-water to the shallow groundwater table and remove huge amounts of contaminated soil." So what to do?
Well, if you can't provide a solution, then redefine the problem. Thus the only practicable answer, they believe, is to petition the state Department of Environmental Protection to change the designation of the groundwater, so it is no longer considered a potential source for drinking. As things now stand, the whole of Martha's Vineyard is considered a sole source aquifer, meaning all the water is assumed to be potable. In their letter to landowners, the engineers propose a change in the designation of a large area, including all properties located in the waterfront and commercial area and some of the residential area - effectively all of downtown Vineyard Haven. The process of getting that done, though, as noted in their letter is "well-defined but burdensome." It involves providing technical data showing the extent of the problem, an aquifer map, other hydrological details, documentation from the town attesting that it has enough drinking water to meet future needs from other sources, a public comment period and other stipulations. In short, it requires concerted action and involves cost.
But Mr. Anderson said he hoped the letters which have gone to landowners, selectmen and relevant town officials would build momentum for the petition. "We're not trying to scare people," Mr. Anderson said, "but we need to reach an accommodation, because this is the only way commerce can go forward in the area. Otherwise, people will have problems into the future." He said the contamination problem had cost him "quite a bit" over the years. "And it will probably require more. And it will require a lot of education of people. We've now contacted a lot of them by letter or by phone. I guess there will have to be a public meeting to discuss it," he said. But after 100 years or more, people could not continue to ignore the issue. Or as he put it - choosing an appropriate metaphor, considering the location of the contamination - "sticking your head in the sand."
First published in the Vineyard Gazette on June 9, 2009. Reprinted with permission. Copyright Vineyard Gazette 2009. All rights reserved.
News Brief printed in The Martha's Vineyard Times, Thursday, June 11, 2009:
Groundwater Reclassification for Five Corners Area
Ralph Penney, president of Penney Engineering, sent a letter in April to Tisbury town officials and property owners around the Five Corners intersection in Vineyard Haven asking for their support for a change in the way the Massachusetts Department of Environmental Protection (DEP) classifies the area's groundwater.
Mr. Penney plans to petition the DEP for a change in the area's designation from a "potential drinking water source area" to a "non-potential drinking water source area." Under the current DEP designation, Mr. Penney's letter explained, any accidental spills of contaminants requires cleaning up groundwater to meet drinking water standards. However, the groundwater in the surrounding Five Corners area cannot readily be used for drinking water to begin with, as it is brackish and contaminated from past uses in the area.
Under the current DEP designation, if property owners do not achieve the drinking water clean-up standards they will be unable to sell or refinance their properties he said.
In 1995 Mass Highway encountered extensive petroleum contamination in the soil and groundwater along Beach Road and Water Street when installing storm drains. Only some of the sources could be identified, Mr. Penney said.
Mr. Penney said his company has been working with Eric Anderson on his properties at 8 Beach Road and 23 Beach Street Extension since 2001, with no end in sight under the current groundwater designation. "It would take millions of dollars to remove the historical buildings, dewater to lower the shallow groundwater table and remove huge amounts of contaminated soil," Mr. Penney's letter said.
A change in the DEP's groundwater classification would make current and future site cleanups easier for Vineyard Haven property owners to achieve, Mr. Penney said. The newly designated area would include all the properties located in the waterfront/commercial and B-1 districts, as well as the densely populated portions of the R-10 district.
Properties in the Lagoon Pond District of Critical Planning Concern (DCPC) or the portion of the R-10 District also in the Groundwater Protection District would not be included.
The petition process involves meeting several requirements, such as submitting technical data about water resources and supply, an aquifer map, and documentation of comments received in a public comment period.
"I would estimate the petition costs will be, worst case scenario, about $20,000," Mr. Penney said in a phone call this week. "It makes so much sense, and it would benefit everybody."
-Copyright 2009, The Martha's Vineyard Times, reprinted with permission
These pictures also show just how devastating a heating oil spill can be. This home on Cape Cod had an outdoor heating oil tank that leaked. The entire house had to be moved off the foundation to allow the soil under the foundation and the basement floor to be excavated. The old fieldstone foundation had to be removed. A new concrete foundation and basement floor had to be poured. The house was placed back on the new foundation. The doors and windows all had to be adjusted. The plaster walls cracked.
We have developed better cleanup methods. If the groundwater is shallow, bacteria can be used to digest the heating oil. Special equipment is used to grow the bacteria and re-circulate the groundwater through the contaminated soil. It takes about a year for the bacteria to eat the oil. To learn more, check out the bioreactors page. We can also use chemicals to oxidize the heating oil. The process basically burns the oil in place without a flame. Both are better than removing the house.