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Webster, Clifford - Ruling, January 7, 2000

Ruling, January 7, 2000

STATE OF NEW YORK : DEPARTMENT OF ENVIRONMENTAL CONSERVATION

In the Matter of the Alleged Violation of
Article 17 of the New York State Environmental
Conservation Law and 6 NYCRR Parts 612 and
613 by (Motion for Order Without Hearing)
Clifford Webster
d/b/a Carl's Frosty Twist
Bridgewater (V), Oneida County, NY
Respondent

ORDER OF
CONTINUANCE

Case No.R6-2319-99-05

Proceedings

Pursuant to a Notice of Motion and Motion for Order Without Hearing dated September 30, 1999, with accompanying Affidavits in Support of Motion for Order Without Hearing by Donald I. Johnson and David Pickett, and a Memorandum Supporting Motion for Order Without Hearing, duly served upon Clifford Webster, 12901 Bonta Road, Cato, NY 13033 (the "Respondent"), the New York State Department of Environmental Conservation (the "Department" or "DEC") Region 6 Staff ("Staff") moved for an Order Without Hearing pursuant to Title 6 of the Official Compilation of Codes, Rules and Regulations of the State of New York ("6 NYCRR") Section 622.12 charging Respondent with violation of Article 17 of the New York State Environmental Conservation Law ("ECL") and 6 NYCRR Parts 612 and 613. Randall C. Young, Esq., Assistant Regional Attorney made the motion on behalf of the Department Staff.

On October 13, 1999, the Department Staff agreed to suspend the running of time for the Respondent to file a response to the Department's Motion. On October 26, 1999, the Department Staff provided a proposed Consent Order in this matter and asked that the Respondent respond by November 5, 1999.

This matter was assigned to Administrative Law Judge ("ALJ") Frank Montecalvo on October 29, 1999.

By letter dated November 10, 1999, the Department Staff notified the Respondent that the Department had not received a response to its proposed Consent Order or the Motion, that the suspension time for the Respondent to file his notice was then terminated, and that the Respondent had eight days from the receipt of the Department's letter to file a response to the Motion in accordance with the instructions contained in the Notice of Motion.

On November 19, 1999, the Respondent filed his Answer to the Department's Notice of Motion for Order Without Hearing. On November 24, 1999, the Staff filed a Memorandum responding to the Respondent's Answer.

SUMMARY OF THE PARTIES' POSITIONS

The Staff's Charges and Relief Requested:

The Staff allege that the Respondent violated 6 NYCRR §612.2(b) by having failed to register a petroleum bulk storage facility located at a site at the corner of Routes 8 and 20 in Bridgewater, Oneida County, NY, known as "Carl's Frosty Twist. The Staff also allege that the Respondent violated 6 NYCRR §613.5 by having failed to tightness test underground petroleum bulk storage tanks at the aforesaid facility, after Respondent purchased the facility in 1996. Staff allege that the Respondent's failures continued in spite of several warning letters from the Department Staff.

The Staff request a Commissioner's Order which, among other things: finds that no hearing is required because no material issue of fact exists; finds that the Staff are entitled to judgment as a matter of law and to the relief requested; orders that the Respondent pay a civil penalty in the amount of $10,500.00; and orders that the Respondent register the facility and tightness test the tanks or permanently close all tanks per the regulations.

Summary of the Respondent's Answer:

The Respondent contends that he did not purchase the business or "D/B/A" of "Carl's Frosty Twist," but, rather, the property at the stated location. The Respondent contends that the facility was never abandoned, but was closed as a Petroleum Storage Facility approximately 30 years ago (some time prior to 1972), after having previously been operated as a gas station. As proof that the tanks were taken out of service, the Respondent submitted results of tests of the content of the tanks. Respondent contends that the test results show that petroleum, as defined in §17-1003, is not present in the tanks. Respondent alleges his understanding that at the time of tank closure 30 years ago, it was standard procedure to pump out all petroleum product and replace same with enough water to keep the tanks from surfacing. He also alleges that in the 1972 deed of the property to Carl (senior) and Evelyn Gerhardt, there was an agreement that no petroleum products would be sold or advertised from the site for 25 years. The Respondent states he was informed that, in 1995, Carl Gerhardt, Jr. filed a Petroleum Bulk Storage Application for a temporarily closed new facility at the property upon the instruction of and after being threatened with fines and other legal remedies by officers of the Department.

The Respondent contends that the filing of the application, under the circumstances, does not give the Department the authority to regulate the site, and contends that the Department either misunderstands or is unaware of the facts surrounding the site, or is misusing its powers under ECL Article 17, Title 10 "Control of the Bulk Storage of Petroleum." Noting that Oneida County had title to the site before the Respondent, the Respondent argues that the Department chose not to enforce the law at that time. The Respondent expressed his belief that there has been no report of spills, contamination of groundwater or complaints of any kind that would allow the Department to regulate the site.

The Respondent contends that the Staff's claim that he had never responded to the Department's requests to register the facility is not true, that he met with the Department on several occasions, and that in 1997 he hired a Hazardous Material Engineer to test the contents of the tanks as specified by the Department. Respondent argues that the Department has shown no interest in working with the Respondent to insure a solution that would not result in the Respondent's bankruptcy. Respondent alleges that he is unemployed, has not worked in over a year, is 60 years old, and is in the middle of a divorce which has tied up his resources. Respondent alleges his understanding of a solution to the pending charges that had been agreed upon with the Department Staff, but that the Staff's proposed Consent Order, when received, differed significantly from same and amounted to a "plea of guilty on all counts" and acceptance by Respondent of predefined fines and penalties. Respondent further alleges that he never received a list of contractors who could perform removal that was promised by the Department.

The Respondent requests a hearing for proof that the Department has the right to regulate the site. Respondent contends that a hearing will prove that the site was "grand-fathered" approximately 30 years ago by closure of the petroleum facility, that there have been no reports of spills, groundwater contamination or complaints of any kind that would give the Department power to regulate the site. The Respondent also requests that notice of any pending hearing give adequate time to locate witnesses and obtain proper legal counsel.

The Staff's reply:

The Staff argue that the Respondent's answer is an admission of the violations. The Staff contend that the Respondent admitted to purchasing the facility, contend that Respondent admits by implication that he never registered the facility, and point out that Respondent's statement that the tanks were previously closed ignored the definition of permanent closure contained in §613.9, which also states that storage tanks or facilities which have not been closed pursuant to paragraph 613.9(b)(1) are subject to all requirements of Parts 612 and 613. The Staff further note that there is nothing in the sections which exempts or grandfathers tanks that existed prior to the promulgation of the regulations.

The Staff claim that the Respondent is relying on "spurious arguments," "irrelevant arguments," and "supposition," and argue that such will support a conclusion that a hearing is not appropriate. The Staff claim that the Respondent's references to his research and deed restrictions without attaching documentation of same demonstrates he does not have the ability to offer relevant factual evidence. The Staff call the Respondent's allegations regarding the facility's registration "double hearsay" and noted that the Respondent failed to obtain an affidavit from the person from whom the information was supposedly available.

The Staff further contend that the Respondent's allegations of inattention by the Department are unsupported and irrelevant.

Findings of Fact

  1. By tax sale deed dated December 31, 1992, the Board of County Legislators of the County of Oneida, State of New York, acquired premises located in the Town of Bridgewater at the intersection of Routes 8 and 20 which had been owned by Carl Gerhardt and his wife.
  2. On or about August 9, 1995, the Department received a Petroleum Bulk Storage Application from Carl Gerhardt, Waterville, NY, as owner of "Carl's Frosty Twist," for an "Other Retail Sales" type of petroleum facility located at the northwest corner of the intersection of Routes 8 and 20, Bridgewater, Oneida County, New York. The transaction was for an "Initial/New Facility."
  3. The PBS Application indicated that the facility included seven petroleum storage tanks: Tanks 001 and 002 being above ground with capacities of 550 gallons each; Tanks 003 through 005 being unprotected underground petroleum bulk storage tanks with capacities of 3,000 gallons each; Tank 006 being an unprotected underground storage tank with a capacity of 4,000 gallons; and Tank 007 being an aboveground storage tank with a capacity of 275 gallons. The application indicated that the facility had a capacity of 14, 375 gallons, and that all tanks were of unknown age.
  4. On January 24, 1996, the tax sale deed of the premises to the Board of County Legislators was recorded in the Oneida County Clerk's Office in Liber 2727 of Deeds at Page 613.
  5. By deed dated January 26, 1996, the Board of County Legislators of the County of Oneida, pursuant to the Board's Resolution Number 337 dated December 13, 1995, conveyed the premises formerly owned by Carl Gerhardt and wife to the Respondent, Clifford E. Webster, 12901 Bonta Bridge Road, Cato, NY. The premises were formerly known as "Carl's Frosty Twist."
  6. The Respondent did not purchase the business or "D/B/A" known as "Carl's Frosty Twist."
  7. By letters dated July 9, 1996, June 13, 1997 and January 5, 1998, Donald Johnson of the Department's Region 6 Utica Sub-Office advised the Respondent that the Department was aware that Respondent had purchased the "facility," and that the Respondent was obliged to register the "facility's" change in ownership, and to tightness test or properly close tanks 3, 4, 5, and 6.
  8. On July 24, 1997, David Pickett of the Staff visited the premises, met Clifford Webster, and opened the fill ports of four of the underground tanks at the site. Mr. Pickett measured said tanks' diameters, and found them to be consistent with the following: two underground tanks of at least 500 gallon capacity; one 3,000 gallon underground storage tank; and one 4,000 gallon storage tank. The fill port of one tank appeared to Mr. Pickett to have been paved over and, thus, he was unable to open it. Mr. Picket also observed one 275 gallon above ground storage tank.
  9. The Respondent has not registered the premises' tanks as a petroleum bulk storage facility with the Department.
  10. The Respondent has not submitted tightness testing reports to the Department regarding tanks 003 through 006 on the premises.
  11. The Department's records show no transfer or closure of a facility on the premises by the Respondent.

Discussion

The Findings above are based upon the uncontested allegations of both the Staff's and the Respondent's affidavits. If there is a petroleum bulk storage "facility" on the premises, then on the facts above, there is no question that the Respondent owns it, is responsible for registering it, is responsible for tightness testing the tanks, and is in violation of the law on both counts for failing to do so. The Respondent, however, has questioned the Department's jurisdiction, i.e., does he own a regulated facility?

Is there a "facility"?

Normally, an application is an admission of the Department's jurisdiction (i.e., an applicant may be held to his or her own statements). Here, the Staff appear to rely on Mr. Gerhardt's registration of the premises as a "facility" to hold the Respondent liable under 6 NYCRR §612.2(b) for failing to "re-register" the facility after he acquired the premises. If Staff does so to establish the Department's jurisdiction, then the circumstances under which Mr. Gerhardt registered the premises become a relevant area for inquiry. Although the Staff argue that the Respondent relies on "double hearsay" and has not produced an affidavit regarding the circumstances of the registration, the Staff do not deny the Respondent's allegations that Mr. Gerhardt filed the application upon instruction by Staff. Furthermore, the deed Staff submitted with their motion papers suggests that Mr. Gerhardt may not have had the capacity (i.e., ownership of the premises) to file the application because it indicates that the County was the owner at the time the application was submitted. The issue of the circumstances of registration could partially be resolved by subpoenaing Mr. Gerhardt to tell what happened.

However, if the registration, by itself, does not make the premises a "facility," then, the circumstances of the registration would not be a relevant area for inquiry. I conclude that the registration by Mr. Gerhardt does not make the site a "facility" vis-a-vis the Respondent, and that no inquiry needs to be made concerning the circumstances of registration, because (1) there is no indication that the application was filed on the Respondent's behalf and (2) "facility" is defined by both the statute and regulations in terms of physical structures and conditions and not registration.

The facts found above establish the presence of tanks on the site with a total volume in excess of 1,100 gallons, suggesting that they constitute a "facility" as that term is defined in the regulations at 6 NYCRR §612.1(c)(10), i.e., "one or more stationary tanks, including any associated intra-facility pipelines, fixtures or other equipment, which have a combined storage capacity of over eleven hundred (1,100) gallons of petroleum at the same site. A facility may include aboveground tanks, underground tanks or a combination of both. Pipelines which enter or leave the site and nonstationary tanks are not part of the facility." (italics supplied). Thus, under this definition it is irrelevant whether or not the tanks contain or have ever contained petroleum, as long as they are together on the site and have a combined capacity to store or contain more than 1,100 gallons of petroleum. This interpretation is buttressed by the definition of "existing facility" as meaning "a facility which has been constructed and is capable of being operated" as of January 26, 1985 (§612.1(c)(10), italics supplied). Although sufficient tank volume (>1,100 gal.) exists on the site, it is unknown whether the tanks are actually capable of storing petroleum.

Assuming that the tanks are capable of storing 1,100 gallons of petroleum, the Respondent essentially contends that the tanks are not a "facility" because they have not been used for 30 years. The Respondent may have a point. The statute does not define facility in terms of capacity, but rather, in terms of present use. ECL Article 17, Title 10, "Control of the Bulk Storage of Petroleum," at §17-1003 (1) defines "facility" to mean "one or more stationary tanks, including any associated pipes, lines, fixtures and other equipment, which are used singularly or in combination for the storage or containment of more than one thousand one hundred gallons of petroleum at the same site ..." (italics supplied). Since empty tanks or tanks full of water are incapable of leaking or spilling petroleum, regulation of same does not appear to have been an objective of the legislature. (Compare §17-1001, legislative findings and declarations).

On the other hand, the statute is clear that once a "facility" exists, it continues to be subject to the inspection and testing requirements until it is closed in accordance with the Department's regulations (i.e., mere removal of petroleum, or removal followed by filling with water, would not be enough to remove the tanks from regulation if the regulations do not specify this type of closure). See §17-1005(2)(b).

The burden, of course, is on the Department to establish that it has jurisdiction to regulate what is on the premises. Since there is no evidence that the site's tanks store or contain more than 1,100 gallons of petroleum, or have done so at any time since the statute was enacted in1983, they don't appear to meet the statute's definition of "facility." If the statutory definition of "facility"cannot be applied to the premises, then the statutory requirements pertaining to registration (ECL §17-1009) and leak detection and closure (§17-1005) may not be applied. Presumably the regulations implementing same also may not be applied if doing so would be inconsistent with the statute.

Based on the analysis above, it is too soon to determine the need for a hearing. There is a legal question that must first be answered: Did the legislature intend to impose registration and testing requirements on tanks or combinations thereof that existed at the time of the legislation, but did not at that time or later contain or store 1,100 gallons of petroleum?

Order of Continuance

Pursuant to §622.12(c), it is ordered that this matter is continued until March 15, 2000 during which time the parties are to do as follows:

By no later than February 10, 2000, Department Staff is to file a brief of the question above.

Within 30 days of receiving this information, Respondent will have an opportunity to file a brief in reply.

The parties are directed to file their briefs with Chief Administrative Law Judge Daniel E.Louis at the Office of Hearings and Mediation Services, 50 Wolf Rd Room 423, Albany, NY 12233-1550, and to send copies of same to each other.

January 7, 2000
Albany, NY

/s/
Frank Montecalvo
Administrative Law Judge

TO: Clifford E. Webster
12901 Bonta Bridge Road
Cato, NY 13033

Randall C. Young, Esq., Assistant Regional Attorney
NYSDEC, Division of Legal Affairs, Region 6
317 Washington Street
Watertown, NY 13601-3787

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