What lies beneath: the challenging problems of fuel storage tanks | www.rebgv.org

In the 1990s, Evelina Power owned a bungalow heated by an oil furnace. When she sold the home, the furnace and the fuel storage tank were in full view in the cellar.

A decade later, a process server rang Power’s doorbell, confirmed her identity, and handed her a summons to appear in small claims court.

“While bulldozing a backyard shed, the most recent owner uncovered an abandoned oil tank underneath which was leaking toxic oil,” said Power. The owner decided to sue Power under the Contaminated Sites Regulation.

“They wanted me to pay up to $25,000 for not disclosing the tank and for cleanup and remediation costs,” said Power.

Power spent days tracking down the person from whom she had bought the property. He signed an affidavit that Power could not have known about the tank since he hadn’t known about it.

Months later, during a settlement conference, an adjudicator found Power was an innocent buyer and had known nothing about the tank. The current owner had to go back further to locate previous owners.

How many tanks are out there?

No one knows for sure how many tanks are still buried in Metro Vancouver’s 21 municipalities, according to Lucas Wouters of West Coast Tank Recovery.

Underground storage tanks were extensively used to contain home heating fuel until the 1970s when natural gas became readily available. “Tanks never required registration and there was no permitting system, so it’s impossible to know how many exist,” said Wouters.

Often, they’ve been forgotten and are buried and hidden in yards and basements. While telltale signs can include vent and fill pipes or copper lines sticking out of lawns or the ground close to buildings, there may be no other indications.

“Keep in mind, in areas such as Pemberton and the Gulf Islands, tanks are also still used,” said Wouters. Depending on the terrain, some may be visible.

Provincial and local regulations

In BC, residential fuel storage tanks are regulated by the BC Fire Code, Part 4, which covers the installation, maintenance, repair, removal, and abandonment of tanks.

Toxic leaks are governed by the BC Environmental Management Act and the Contaminated Sites Regulation.

Within the Real Estate Board of Greater Vancouver area, 20 municipalities may also have bylaws, policies, and additional requirements for removing or abandoning tanks that are administered by the local fire department.

This Fact Sheet links to each municipal bylaw, and includes the costs of fees and permits, requirements for remediation and inspection, and guidelines for dealing with leaking tanks, abandoning tanks in place and penalties.

Why are tanks an issue?

The life span of a tank is about 25 years and as tanks age and corrode, they can become a health and safety hazard, according to Wouters.

Heating oil, gas, diesel fuel and other toxic substances can leak into surrounding soil, neighbouring properties and even the groundwater system and can cause a fire or an explosion hazard.

Cleanup costs range from $5,000 to $30,000, according to Wouters, although there are cases where homeowners have paid as much as $123,000, according to Mike Mangan, a real estate lawyer and contributor to BC Real Estate Association’s Legally Speaking.

Who’s responsible for tank removal and cleanup?

“Those who are in some way responsible for causing contamination are classified as responsible persons,” according to the Ministry of Environment’s Remediation Liability Overview.

This can include a current owner, a previous owner, and even a producer or transporter of a substance that caused the contamination.

Who isn’t responsible?

Property owners who innocently acquired the site. An innocent owner or previous owner must prove:

  • at the time they bought the property it was already contaminated;
  • they had no way of knowing the property was contaminated;
  • and they asked the previous owner about whether there had been a tank on the site.

 

Focus on the City of Vancouver

The City of Vancouver is updating requirements for property owners dealing with underground storage tanks, according to James Smith, assistant manager of the City’s Environmental Contamination Team.

The City of Vancouver is updating requirements for property owners dealing with underground storage tanks, according to James Smith, assistant manager of the City’s Environmental Contamination Team.

Smith estimates Vancouver has as many as 20,000 remaining tanks which are under the City’s Fire Bylaw which follows a CCME Code of Practices for tank removal and decommissioning; and the City’s Sewer and Watercourse Bylaw No. 8093, section 5.3 which requires property owners to remove a tank that will not be reused or has been out of service for two years.

Tank removal permit and reporting requirements

If a property owner suspects there is a tank, they should first hire a certified company to scan their property.

If the scan confirms there is a tank, the owner must:

  • hire a qualified professional such as an engineer to oversee the process of removal and remediation and to confirm contaminated soils are properly assessed and managed and work meets BC Ministry of Environment standards;
  • pay $300 for a tank removal permit from the City of Vancouver Fire Prevention Office at 456 West Broadway, suite 306, Vancouver;
  • comply with conditions on the permit, which is kept in the City’s permits and licence’s data resource centre; and
  • hire qualified contractors experienced in tank removals.

During the tank removal, all contaminated soils must be removed. Soil must be tested on the property and on neighbouring properties until contamination is no longer present. Clean fill is then brought in.

If contaminants have leeched onto a neighbouring property, neighbours must be formally notified using a Notification of Likely or Actual Contaminant Migration as detailed in the Contaminated Sites Regulation sec. 57 and 60.1. and provide a copy to the local municipality.

Along with the tank removal permit, a property owner will be given a Final Tank Removal/Closure Report template.

This report template requires a site sketch, tank information, proof of disposal work completed, field observations, soil sampling completed and analytical results and photos.

Supporting information must be attached including lab certificates detailing what was pumped out of the tank, a receipt from the facility where the tank was taken and the amount of soil brought in. A conclusion statement must be also be completed and stamped by a qualified professional.

The professional overseeing the removal will complete and sign this template which the property owners send to the Environmental Contamination Team at ust.reporting@vancouver.ca.

The City has this useful Bulletin, Residential Storage Tank Removal.

What happens if you don’t follow the recommendations?

Property owners can face fines of up to $10,000 and six months in prison.

If a tank can’t be removed

What happens if a tank is under a porch, addition, deck or part of a house and can’t be removed?

The Fire Chief must determine whether or not a tank must remain.

Then, the property owner must hire a qualified professional to decommission the tank by emptying it and filling it with an inert material such as sand.

Disclosure – what property owners must do

Keep in mind – any property could contain an underground storage tank.

An underground or above-ground tank can expose sellers and buyers to significant financial loss and liability, according to the Real Estate Council of BC.

If you are a buyer, your Realtor will advise you to:

  • have the property inspected for fill and vent pipes;
  • seek expert opinion especially if the storage tank is thought to be leaking; and
  • consult with lenders and insurance companies regarding policies about underground or above-ground tanks.

As a buyer you can also include the tank removal as a condition of sale.

Is a seller suspects there many be a tank, they need to hire qualified professionals to determine if a tank exists. Otherwise sellers can expose themselves to significant liabilities,” said Mangan.

Information on the Property Disclosure Statement about a tank must be accurate.  As a seller, you may need to consult an environmental and legal professional about whether the tank in question is a material latent defect.

A seller must disclose the presence of an unused or abandoned underground or above ground storage tank (as a latent defect) in writing as required by section 5-13 of the Real Estate Council of BC Rules.

Contaminated sites registry

Property buyers and sellers should review the BC Contaminated Sites Registry, a list of contaminated sites, sites under investigation and remediated sites.

Learn more