Financial Responsibility for Aboveground Storage Tank Owners and Operators

PURPOSE: This rule establishes allowable mechanisms for owners and operators of regulated aboveground storage tanks to demonstrate financial responsibility for releases of products from those tanks as required by section 414.036, RSMo. (1) Applicability. (A) Except as outlined in paragraphs 1. and 2. of this subsection, this rule applies to the legal owner and operator of an aboveground storage tank, defined as any one (1) or a combination of tanks, including pipes connected thereto, used to contain an accumulation of petroleum and the volume of which, including the volume of the aboveground pipes connected thereto, is ninety percent (90%) or more above the surface of the ground, which is utilized for the sale of products regulated by Chapter 414, RSMo. 1. This rule does not apply to— A. The owner or operator of an aboveground storage tank at a refinery, pipeline terminal, rail terminal, or marine terminal; B. The owner or operator of an aboveground storage tank used for storing heating oil for consumptive use on the premises where stored; or C. The owner or operator of an aboveground storage tank situated in an underground area, such as a basement, cellar, mineworking, drift, shaft, or tunnel, if the storage tank is situated upon or above the surface of the floor. 2. Aboveground storage tanks which meet the following criteria are deferred from complying with this rule as long as the owner of such tank(s) complies with all other applicable requirements of 2 CSR 90-30: A. The tanks are in use at a single location; B. The tank(s), piping, and dispensing equipment are aboveground and totally contained in a liquid-tight metal, concrete, or synthetic containment; C. The aggregate capacity of the tank(s) located in the secondary containment is two thousand (2,000) gallons or less. (B) Owners and operators of aboveground storage tanks which are in use on or after January 1, 2011, are subject to this rule. (C) If the owner and operator of an aboveground storage tank are separate persons, only one (1) person is required to demonstrate financial responsibility; however, both parties are liable in the event of noncompliance. (2) Amount and Scope of Required Financial Responsibility. (A) The owner or operator of an aboveground storage tank (AST) shall demonstrate financial responsibility for taking corrective action and for compensating third parties for bodily injury and/or property damage caused by sudden and nonsudden accidental releases arising from the operation of the AST in at least the following amounts: 1. One (1) million dollars per occurrence; and 2. Two (2) million dollars annual aggregate. (B) This rule shall not serve to limit the liability of the owner or operator. (3) Allowable Mechanisms. (A) An owner or operator may use any one (1) or a combination of the following mechanisms to meet the requirements of this rule, provided that the total scope and amount meet the requirements of this rule: 1. Self-insurance, subject to the requirements in subsection (B) of this section; 2. The Missouri Petroleum Storage Tank Insurance Fund; 3. An insurance policy issued by a commercial insurance company or a risk retention group, subject to the requirements in subsection (C) of this section. (B) Requirements for Self-Insurance—An owner or operator must have a tangible net worth of at least ten (10) million dollars, per audited year-end financial statements for the latest completed fiscal year or per financial statements filed with the U.S. Securities and Exchange Commission for the latest completed fiscal year. (C) Requirements for Insurance or Risk Retention Group Coverage. 1. An owner or operator may satisfy the financial responsibility requirements of this rule by obtaining liability insurance from a qualified insurer or risk retention group. This insurance may be in the form of a separate insurance policy or an endorsement to an existing insurance policy. 2. The endorsement or policy must provide coverage for claims otherwise covered by the policy that are reported to the insurer or risk retention group within six (6) months of the effective date of cancellation or non-renewal of the policy except where the new or renewed policy has the same retroactive date or retroactive date earlier than that of the prior policy and which arise out of any covered occurrence that commenced after the policy retroactive date, if applicable and prior to such policy renewal or termination date. 3. The endorsement or policy shall be issued by an insurer or risk retention group that, at a minimum, is licensed to transact the business of insurance or eligible to provide insurance as an excess or surplus lines insurer in this state. (4) Cancellation or Nonrenewal by a Provider of Financial Assurance. (A) Except as otherwise provided, a provider of financial assurance may cancel or fail to renew an assurance mechanism by sending a notice of termination by certified mail to the owner or operator. Notice of termination shall comply with the following requirement: 1. Termination of insurance or risk retention group coverage, except for nonpayment or misrepresentation by the insured, shall not occur until sixty (60) days after the date on which the notice is mailed. Termination for nonpayment of premium or misrepresentation by the insured may not occur until a minimum of ten (10) days after the date on which the notice of termination is mailed. (B) If a provider of financial responsibility cancels or fails to renew for reasons other than incapacity of the provider, the owner or operator shall obtain alternate coverage within sixty (60) days after the date coverage cancels or does not renew. If the owner or operator fails to obtain alternate coverage within sixty (60) days, the owner or operator shall immediately notify the director of the Department of Agriculture by mail of the cancellation of coverage and shall submit— 1. The name and address of the provider of financial assurance; and 2. The effective date of termination. (5) Reporting and Enforcement. (A) Upon request, an owner or operator shall submit one (1) or more documents demonstrating compliance with this rule to the director of the Department of Agriculture. (B) If an owner or operator fails to comply with this rule or fails to provide documents to the director demonstrating compliance, the director may, at his sole discretion take enforcement action in accordance with section 414.152, RSMo. AUTHORITY: section 414.036, RSMo Supp. 2010.* Original rule filed Jan. 18, 2011, effective Aug. 30, 2011. *Original authority: 414.036, RSMo 2008.