As required, I must state that the topic I’m about to write about does not contain legal advice. If you are looking for legal advice about a specific environmental question or liability issue, I urge you to contact a local legal professional who specializes in such cases.
For our purposes, here on the blog, I’ll be talking about oil tanks on residential (and commercial) property from a practical standpoint from the view of an agent and what we typically run into in our daily practice.
A prior article on actively used oil tanks was written with the focus on if you are actively using oil heat in a Washington State residence. Today, I want to chat a bit about what you can do, or need to do, if your tank is no longer in use.
Sellers are required via Washington State’s Seller’s Disclosure Statement (aka Form 17 in NWMLS lingo) to give notice of any environmental hazards that may exist on a property; this includes oil tanks whether they are being actively used or not. If you know that an old oil tank exists on your land you’ll need to state if one exists. If you say “yes” to this question you need to be prepared to then provide some additional information such as whether or not you are aware if it was decommissioned, when, and if there is a certificate of the decommissioning. Basically, don’t just say “yes”, provide more detail for a buyer to understand what’s going on with it.
In many local cities and unincorporated county jurisdictions it became more common to get certifications from local fire departments on decommissioned tanks starting around the mid-1990’s. Now it is much more commonplace but each district will handle these issues differently. Be sure to check with your local fire department or city/county to sort out what the requirements are for your area, and call local oil tank servicing/decommissioning companies to find out what the services are that they offer. I’m working on a sale right now where a question about an old tank has come up because the client believes his father (now deceased) had a tank decommissioned but he’s not absolutely sure. As an estate sale the seller is exempt from filling out a Form 17 but this item came up during the inspection process so now we are going back and forth between the estate attorney and the buyer to come up with a workable solution.
From my side, my initial attempt to see if we could find out if the tank had been decommissioned led me to call the local fire department first. If a tank received a certificate from the fire department they usually will have it on file. Since this decommissioning happened likely between 15-20 years ago there is no record as confirmed by the fire department inspector I spoke to. So, now we have an oil company going out to the property to check the tank to see if it has been done, and if it was done properly. If necessary, we’ll have it cleaned again. One reason we even have access to the tank is because the in-fill pipe is embedded in an exposed aggregate concrete sidewalk.
Usually when a tank is decommission the following series of items typically happens: 1) any remaining oil in the tank is removed, 2) the tank is triple washed to clean it, 3) a slurry or concrete mixture is pumped into the tank to fill it, 4) the in-fill pipe is cut off below grade (under ground) and capped off to prevent future access.
Sometimes people have bought homes without knowing a tank exists on the property. In the past, before these more commonly used decommissioning methods came into play a tank could have been left empty and the weight of dirt around it would crush the tank over time creating a depression in the ground. If you’re walking a property and see a big dip in the yard that can’t be explained, you might consider if there is a tank or at least ask if the seller knows of one.
The other not so good thing which has happened at some properties is that a tank might be left with a small amount of oil in it from when it was emptied and condensation occurred inside the tank thus eventually causing the metal tank to rust out and develop a hole in the tank where the oil then seeped into the ground. THIS is a major environmental hazard and sellers who know that this has occurred, or who find out through environmental testing at the site (dirt samples) become liable for the clean up of the site. This can be a very expensive situation. I’ve spoken with homeowners before who paid upwards of $12,000 to have a tank removed, the dirt either cleaned or replaced, and the yard put back to its former condition. That and the cost of the lawsuit against the oil company that didn’t follow up on their insurance policy on the tank (in this case it was an actively used tank that leaked) ended up costing them a pretty penny.
So, be alert and try to sort out when you’re doing your due diligence (as a buyer) to find out if a tank has ever been on the property and whether or not it was handled correctly. As a seller, or even just as a homeowner in general, be prepared and put your paperwork together for a future sale. You’ll be happier in the end.
