New MUSTA Legislation Enacted

Posted on October 27, 2017

House Bill 4583 was recently signed into law by Governor Snyder.  This Bill creates the “Legacy Release Program”, establishes new options to demonstrate financial responsibility for cleanup fund deductibles, and provides for reimbursement of local units of government (LUG) for certain corrective action costs. The highlights of HB 4583 (now referred to as Public Act 134 of 2017) are outlined below:

  • The Legacy Release Program is created and will be administered by the Michigan Underground Storage Tank Authority (MUSTA). The intent is to provide a mechanism to aid in the completion of corrective actions and to close out “old” UST releases. In order to be eligible, the following requirements apply:
    • The UST release was discovered and reported prior to Dec. 30, 2014;
    • The UST release was not closed under Part 213 of the Michigan Natural Resources and Environmental Protection Act (NREPA) prior to Dec. 30, 2014;
    • Any USTs currently operating at site are in compliance with the registration requirements of Part 211 of NREPA;
    • The request for reimbursement cannot include money reimbursed from any other source (including insurance policies);
    • The request for reimbursement can only be for corrective action performed on or after Dec. 30, 2014.
    • The amount approved for reimbursement by MUSTA shall be 50% of the eligible aggregate indemnification and corrective action costs incurred, but not more than 50% of the reasonable and necessary eligible costs (as determined by the MUSTA administrator);
    • The total amount approved for reimbursement shall not exceed a total of $50,000 for all releases at a single location.
    • “Eligible Person” is defined as the owner or operator of a refined petroleum UST at the time of the reporting of the release.
  • The Michigan Underground Storage Tank Authority (MUSTA) will reimburse LUGs and county road commissions for the costs of corrective action to manage, relocate, or dispose of any media (such as soil and/or groundwater) contaminated by regulated substances left in place within a public highway pursuant to Section 21310a of NREPA (i.e., there are institutional controls, restrictive covenants, or other land use restrictions in place). The following requirements apply:
    • The LUG or road commission must submit a claim to MUSTA (only reasonable and necessary eligible costs, as determined by MUSTA, will be allowed)
    • The amount of reimbursement requested cannot exceed $200,000 per claim.
  • UST owners and operators (O/O) that utilize the Underground Storage Tank Cleanup Fund have two new options for demonstrating financial responsibility for the fund’s deductible amount. The deductible is $2,000 per claim for UST O/O with 7 or fewer USTs, while the fund deductible for UST O/O with 8 or more USTs is $10,000 per claim. The new options are as follows:
    • Financial test of self insurance – the O/O must submit certified financial information to demonstrate a tangible net worth of at least 3 times the deductible amount. MUSTA will develop the necessary forms for submittal.
    • A deposit account is established – the amount of the deductible can be deposited into an account at a financial institution, provided access is restricted by a control agreement or similar restriction approved by MUSTA that requires the approval of the MUSTA administrator for withdrawal from the account.

You can access the entire enrolled HB 4583 here: http://www.legislature.mi.gov/(S(ukrmflsu2s2fmjsggthb31hu))/mileg.aspx?page=getObject&objectName=2017-HB-4583

If you have any questions about a release from USTs and potential eligibility for accessing Michigan’s UST cleanup fund or need help filing an insurance claim for your UST release, feel free to contact Eric Gielow.