HB 1632

Generally, the Tennessee Drycleaner's Environmental Response Act establishes an environmental response fund and program. The fund is used to reimburse part of the cost of an investigative or remedial response to a release of drycleaning solvents at a current or abandoned drycleaning facility. The fund is funded primarily by drycleaners and wholesalers of drycleaning solvents who pay into the fund through registration fees and solvent surcharges. Wholesale Distributors Present law requires wholesale distributors of drycleaning solvents to register each in-state wholesale distribution facility with TDEC. Under present law: (1) "Wholesale distributor"" means a person whose primary business is selling drycleaning solvents and supplies to in-state or out-of-state drycleaning facilities; (2) ""Primary business"" means where the percentage of the person's or company's gross receipts from the sale of drycleaning solvents and supplies to such drycleaning facilities equals or exceeds 20% of total gross receipts; and (3) ""In-state wholesale distribution facility"" means a place of business located in Tennessee of a wholesale distributor or any real property premises or individual leasehold space located in Tennessee, occupied by an in-state wholesale distribution fac ility after June 13, 1995. This bill redefines ""wholesale distributor"" to mean a person engaged in the sale or delivery of drycleaning solvents, supplies, or services to in-state or out-of-state drycleaning facilities . This bill removes the ""primary business"" metric from the definition of ""wholesale distributor"". Impacted Third Parties and Abandoned Dry Cleaning Facilities Present law requires the commissioner of environment and conservation to develop rules for the current or prior owner or operator of an abandoned drycleaning facility, or impacted third party to petition the commissioner to participate in the program, th ereby becoming eligible for reimbursement from the fund. For purposes of present law, ""impacted third party"" means a lessor of real property on which a drycleaning facility or an in-state wholesale distribution facility is located, a property owner whose real property is adversely environmentally impacted by a release from a drycleaning facility or in-state wholesale distribution facility, or their predecessors, successors or assigns, mortgagees, predecessors-in-title and successors-in-title. This bill removes impacted third parties from the Tennessee Drycleaner's Environmental Response Act. This bill adds a requirement that the owner or operator of a recently abandoned drycleaning facility register with TDEC be fore or simultaneously with submission of a petition to access the environmental response fund. After the initial acceptance of a recently abandoned drycleaning facility into the program, the owner or operator o f a recently abandoned drycleaning facility is generally required to comply with annual registration and payment requirements applicable to drycleaning facilities and in-state w holesale distribution facilities. For purposes of this bill, a drycleaning facility is r ecently abandoned if it cl osed in accordance with the commissioner's rules no more than 180 days prior to the date of submittal of a petition to access the drycleaner environmental response fund . Covered Releases Under present law, reimbursement from the fund may be allowed for the spilling, pouring, overfilling, leaking, leaching, emitting, discharging, or escaping of drycleaning solvents from a drycleaning facility or an in-state wholesale distribution facility or its associated piping which impacts gro undwater, surface water, surface, or subsurface soils (a ""release""). This bill adds authorization to use the fund to reimburse the investigation and remediation of soil gas vapor, including sub-slab vapor and indoor air, caused by drycleaning solvents as d escribed above. Commissioner's Authority This bill revises the duties and responsibilities of the commissioner of environment and conservation under the Tennessee Drycleaner's Environmental Response Act. Several of such changes involve a shift from authorizing the commissioner to use the fund to provide reimbursement for investigation and remediation to authorizing the commissioner to e nter into contracts and use the fund for purposes directly associated with accepted petitions for the investigation, containment, cleanup, monitoring, and mainten ance of releases . This bill also authorizes the commissioner to enter premises and review records for purposes of investigating suspected violations of the Act. Penalties Present law authorizes the commissioner to assess a civil penalty of up to $10, 000 against a person who sells or transfers drycleaning solvent to a person owning or operating a drycleaning facility unless the owner or operator of the drycleaning facility has conspicuously posted a copy of a valid certificate evidencing registration of the drycleaning facility . This bill instead authorizes the commissioner to assess a civil penalty of up to $10, 000 for any violation of the Act. Registration Fees and Solvent Surcharges Present law requires the commissioner to promulgate rules that establish a schedule of amounts of annual registration fees to be paid by drycleaning facilities that is based on the amount of drycleaning solvent purchased. Present law sets t he maximum annual registration fee at $1, 500, which is the amount to be paid by abandoned drycleaning facilities . Present law establishe s a drycleaning solvent surcharge of: (1) $10.00 for each gallon of dense non-aqueous solvent or product purchased by a drycleaning facility; and (2) $1.00 for each gallon of light non-aqueous solvent or product purchased by a drycleaning facility. The solvent surcharge is collected by the seller and must be forwarded quarterly to TDEC. This bill replaces the statutory registration fee cap and the solvent surcharge amounts with a requirement that the commissioner set the fee and surcharge by rule. This bill authorizes the commissioner to adjust the fee and surcharge after notice and op portunity for public comment. This bill deletes a present law requirement that TDEC waive the solvent surcharge in a year following a year in which the fund balance exceeds $10 million. Use of Monies in the Drycleaner Environmental Response Fund Present law prohibits the commissioner from authoriz ing the expenditure of funds from the fund in excess of $200, 000 per year for releases from any individual facility . This bill increases such amount to $500, 000 per year and sets a cap of $2 million for all expenditures on an individual facility . Present law establishes various deductibles the owner or operator of a facility is responsible for when seeking reimbursement from the fund. The deductible amounts range from 5 percent, not to exceed $5, 000, for a reimbursement request involving a Categ ory 1 drycleaning facility to 25 percent, not to exceed $25, 000, for a reimbursement request involving an in-state wholesale distribution facility or abandoned drycleaning facility. This bill substitutes a single deductible of 10 percent, not to exceed $ 50, 000, for any person granted fund coverage ."