Title of Regulation: 9VAC25-640. Aboveground Storage Tank and Pipeline Facility Financial Responsibility Requirements (amending 9VAC25-640-30; repealing 9VAC25-640-250).

Statutory Authority: §§ 62.1-44.15 and 62.1-44.34:16 of the Code of Virginia.

Public Hearing Information: No public hearings are scheduled.

Public Comment Deadline: August 21, 2019.

Effective Date: September 5, 2019.

Agency Contact: Melissa Porterfield, Department of Environmental Quality, 1111 East Main Street, Suite 1400, P.O. Box 1105, Richmond, VA 23218, telephone (804) 698-4238, FAX (804) 698-4019, or email melissa.porterfield@deq.virginia.gov.

Basis: The legal basis for the Aboveground Storage Tank and Pipeline Facility Financial Responsibility Requirements (9VAC25-640) is the State Water Control Law (§ 62.1-44.2 et seq. of the Code of Virginia). Specifically, § 62.1-44.34:16 D of the Code of Virginia authorizes the State Water Control Board to promulgate regulations requiring operators of facilities to demonstrate financial responsibility based on the total storage capacity of all facilities operated within the Commonwealth and operators of pipelines to demonstrate financial responsibility for any pipelines operated within the Commonwealth.

Purpose: The amendment modifies the language in 9VAC25-640-30 to include the revisions made to the exclusions in 9VAC25-91-30 of the Facility and Aboveground Storage Tank (AST) Regulation. This will remove confusion concerning activities excluded from regulation. The amendments are necessary to protect the public health, safety, and welfare as they remove confusion concerning activities excluded from the regulation.

9VAC25-640-250, which is obsolete, is being repealed. Regulations are periodically reviewed as required by Executive Order 17 (2014) and §§ 2.2-4007.1 and 2.2-4017 of the Code of Virginia and the regulatory language is no longer needed or applicable.

Rationale for Using Fast-Track Rulemaking Process: The proposed amendments are expected to be noncontroversial and therefore justify using the fast-track rulemaking process.

Substance: This amendment modifies the language in 9VAC25-640-30 to include the revisions made to the exclusions in 9VAC25-91-30 of the Facility and Aboveground Storage Tank (AST) Regulation. This will remove confusion concerning activities excluded from regulation.

9VAC25-640-250, which is obsolete is also being repealed.

Issues: The public, regulated community, and agency will all benefit from these changes. There are no disadvantages to the public, regulated community, or agency.

Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Amendments to Regulation. The State Water Control Board (Board) proposes to incorporate the changes that occurred in a companion regulation.

Result of Analysis. The benefits likely exceed the costs for all proposed changes.

Estimated Economic Impact. This regulation establishes financial assurance requirements for facilities and individual storage tanks that are subject to a companion regulation, the Facility and Aboveground Storage Tank (AST) Regulation (9VAC25-91). The companion regulation contains the technical requirements for registration of facilities and individual ASTs among others. The Board recently excluded ASTs that are an integral part of an equipment or machinery (e.g., fuel tank affixed into the frame of an emergency generator) from registration.¹ In the same action, the Board also added an example to clarify that airport refueling trucks and mobile refueling vehicles are exempt from registration because they are examples of "licensed motor vehicles" that are already excluded from the regulation. In this action, the Board proposes to incorporate in this regulation the new exemption and the clarification of an existing exemption in the companion regulation.

The companion regulation determines whether a facility or an individual AST is subject to registration. Thus, when the companion regulation was amended to exempt certain equipment, the financial assurance requirements relating to those types of ASTs were automatically made obsolete. As a result, amending this regulation will have no economic impact other than improving the clarity of this regulation and consistency between this regulation and the companion regulation.

Businesses and Entities Affected. At the end of fiscal year 2017, there were 10,972 active registered ASTs in Virginia. These ASTs were located at 4,003 facilities within the state.

Localities Particularly Affected. The proposed amendments do not affect any particular locality more than others.

Projected Impact on Employment. The proposed amendments do not have any effect on employment.

Effects on the Use and Value of Private Property. The proposed amendments do not have any effect on the use and value of private property.

Real Estate Development Costs. No impact on real estate development costs is expected.

Small Businesses:

Definition. Pursuant to § 2.2-4007.04 of the Code of Virginia, small business is defined as "a business entity, including its affiliates, that (i) is independently owned and operated and (ii) employs fewer than 500 full-time employees or has gross annual sales of less than $6 million."

Costs and Other Effects. According to the Department of Environmental Quality, there are 2,030 facilities that only have one AST registered, which is an indication that the facility is likely a small business. The proposed changes do not affect costs for them, but will likely improve clarity of the regulation.

Alternative Method that Minimizes Adverse Impact. The proposed amendments do not have adverse effects on small businesses.

Adverse Impacts:

Businesses. The proposed amendments do not have adverse impacts on businesses.

Localities. The proposed amendments would not adversely affect localities.

Other Entities. The proposed amendments would not adversely affect other entities.

______________________

¹http://townhall.virginia.gov/l/viewstage.cfm?stageid=6844

Agency's Response to Economic Impact Analysis: The Department of Environmental Quality has reviewed the economic impact analysis prepared by the Department of Planning and Budget and has no comment.

Summary:

The amendments (i) revise the list of exclusions in 9VAC25-640 for consistency with the Facility and Aboveground Storage Tank Regulation (9VAC25-91-30), a companion regulation, and (ii) repeal an obsolete section regarding regular review of the regulation.

9VAC25-640-30. Exclusions.

The requirements of this chapter do not apply to:

1. Vessels;

2. Licensed motor vehicles, unless used solely for the storage of oil (e.g., airport refueling trucks and mobile refueling vehicles);

3. An AST with a storage capacity of 660 gallons or less of oil, except with regard to purposes of the requirements of 9VAC25-640-220;

4. An AST containing petroleum, including crude oil or any fraction thereof, which is liquid at standard temperature and pressure (60°F at 14.7 pounds per square inch absolute) subject to and specifically listed or designated as a hazardous substance under subparagraphs (A) through (F) of § 101(14) of the federal Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) (42 USC § 9601 et seq.);

5. A wastewater treatment tank system that is part of a wastewater treatment facility regulated under § 402 or § 307(b) of the federal Clean Water Act (33 USC § 1251 et seq.);

6. An AST that is regulated by the Department of Mines, Minerals and Energy under Chapter 22.1 (§ 45.1-361.1 et seq.) of Title 45.1 of the Code of Virginia;

7. An AST used for the storage of products that are regulated pursuant to the federal Food, Drug and Cosmetic Act (21 USC § 301 et seq.), except with regard to purposes of the requirements of 9VAC25-640-220;

8. An AST that is used to store hazardous wastes listed or identified under Subtitle C of the Resource Conservation and Recovery Act (RCRA) (Solid Waste Disposal Act) (42 USC § 6901 et seq.);

9. An AST that is used to store propane gas, butane gas, or other liquid petroleum gases;

10. An AST used to store nonpetroleum hydrocarbon-based animal and vegetable oils;

11. A liquid trap or associated gathering lines directly related to oil or gas production, or gathering operations;

12. A surface impoundment, pit, pond, or lagoon;

13. A storm water or wastewater collection system;

14. Equipment or machinery that contains oil for operational purposes, including but not limited to lubricating systems, hydraulic systems, and heat transfer systems;

15. An AST that forms an integral part (cannot be readily detached or removed) of the equipment or machinery and the contents of the AST are solely used by the attached equipment or machinery (e.g., fuel tank affixed into the frame of an emergency generator);

16. An AST used to contain oil for less than 120 days when: (i) used in connection with activities related to the containment and clean up of oil; (ii) used by a federal, state, or local entity in responding to an emergency; or (iii) used temporarily on site to replace permanent storage capacity, except with regard to purposes of the requirements of 9VAC25-640-220;

16. 17. Oil-filled electrical equipment, including, but not limited to, transformers, circuit breakers, or capacitors;

17. 18. A flow-through process tank;

18. 19. Oily water separators;

19. 20. An AST containing dredge spoils;

20. 21. An AST located on a farm or residence used for storing motor fuel for noncommercial purposes with an aggregated storage capacity of 1,100 gallons or less, except with regard to purposes of the requirements of 9VAC25-640-220;

21. 22. Pipes or piping beyond the first valve from the AST that connects an AST with production process tanks or production process equipment;

22. 23. An AST storing asphalt and asphalt compounds which are not liquid at standard conditions of temperature and pressure (60°F at 14.7 pounds per square inch absolute);

23. 24. Underground storage tanks regulated under a state program;

24. 25. An AST with a capacity of 5,000 gallons or less used for storing heating oil for consumptive use on the premises where stored, except with regard to purposes of the requirements of 9VAC25-640-220.

9VAC25-640-250. Evaluation of chapter. (Repealed.)

A. By October 31, 2012, the department shall perform an analysis on this chapter and provide the board with a report on the results. The analysis shall include (i) the purpose and need for the chapter; (ii) alternatives that would achieve the stated purpose of this chapter in a less burdensome and less intrusive manner; (iii) an assessment of the effectiveness of this chapter; (iv) the results of a review of current state and federal statutory and regulatory requirements, including identification and justification of requirements of this chapter which are more stringent than federal requirements; and (v) the results of a review as to whether this chapter is clearly written and easily understandable by affected entities.

B. Upon review of the department's analysis, the board shall confirm the need to (i) continue this chapter without amendments, (ii) repeal this chapter or (iii) amend this chapter. If the board's decision is to repeal or amend this chapter, the board shall authorize the department to initiate the applicable regulatory process to carry out the decision of the board.