Selling Land with Underground Storage Tanks: What You Need to Know

Selling property that contains underground storage tanks (USTs) requires careful planning and adherence to legal and environmental regulations. If these tanks are not properly managed, they can pose financial, legal, and environmental risks that may complicate the sale process. Understanding how to handle UST-related concerns can help ensure a smooth and successful transaction.

What Are Underground Storage Tanks?

Underground storage tanks are containers used to store fuel, chemicals, or other hazardous substances beneath the surface. These tanks are often found on properties that previously housed gas stations, industrial sites, or commercial facilities. Over time, USTs may corrode and leak, potentially contaminating the soil and groundwater. Due to these risks, federal and state regulations govern the installation, maintenance, and removal of these tanks.

Key Considerations When Selling Land with USTs

1. Full Disclosure is Essential

Sellers are legally and ethically obligated to disclose the presence of USTs on their property. Even if the tanks are no longer in use, buyers must be informed about their existence and condition. Transparency builds trust and reduces the likelihood of disputes after the sale.

2. Understanding Regulatory Requirements

Regulations regarding USTs vary by state and locality. Compliance with federal, state, and environmental protection agency guidelines is essential. Key requirements may include:

• Registration of USTs with environmental agencies

• Routine inspections and maintenance records

• Proper closure or removal procedures if tanks are decommissioned

Non-compliance can lead to significant fines and may delay or prevent the sale of the property.

3. Conducting an Environmental Assessment

Before selling, conducting a Phase I Environmental Site Assessment (ESA) is advisable. This assessment helps identify any environmental risks related to USTs. If contamination is suspected, a Phase II ESA involving soil and water testing may be necessary. Buyers may require these assessments before proceeding with the purchase.

4. Addressing Contamination Issues

If a UST has leaked, remediation is required to prevent long-term environmental damage. The cleanup process may involve:

• Removing the tank

• Treating or removing contaminated soil

• Groundwater monitoring and treatment

• Obtaining clearance from environmental authorities

Addressing contamination proactively can prevent legal and financial liabilities down the line.

5. Financial Considerations

Managing UST-related issues can be costly. Sellers should budget for potential expenses, which may include:

• Inspection and assessment fees

• UST removal and disposal

• Environmental remediation costs

• Legal and compliance fees

While these costs can be significant, taking proactive steps can make the property more attractive to buyers and reduce the risk of price negotiations or legal claims.

Best Practices for Selling Land with USTs

• Hire Environmental Professionals: Working with specialists in environmental assessments and UST removal ensures compliance and proper handling of contamination concerns.

• Keep Detailed Records: Maintain documentation of UST registration, maintenance, and any remediation efforts. Buyers will want proof that proper steps have been taken.

• Consider the Buyer’s Perspective: Many buyers may hesitate to purchase land with UST-related risks. Addressing these concerns before listing the property can help facilitate a faster sale.

Key Takeaways

• Disclosure is Required: Sellers must inform buyers about any existing or former USTs on the property.

• Regulatory Compliance is Critical: Federal and state laws dictate the management of USTs, and violations can lead to penalties.

• Environmental Assessments Help: Conducting site assessments can identify risks and reassure potential buyers.

• Remediation May Be Necessary: If contamination is present, cleanup efforts will be required before selling.

• Preparation Can Ease the Sale Process: Taking proactive steps to address UST concerns can improve marketability and reduce complications.

Final Thoughts

Selling land that contains underground storage tanks requires careful planning, compliance with environmental laws, and proactive risk management. By addressing potential concerns early, sellers can protect themselves from legal and financial liabilities while ensuring a smoother transaction.

Frequently Asked Questions

Q: Do I have to remove an underground storage tank before selling my land?
A: Not necessarily, but any existing UST must be disclosed to potential buyers. If the tank poses a contamination risk, remediation may be required before selling.

Q: How do I know if my property has an underground storage tank?
A: Researching property records, hiring an environmental consultant, or conducting a site assessment can help determine if a UST is present.

Q: What happens if a UST has leaked?
A: If a leak is discovered, environmental remediation is necessary. This may involve removing the tank, cleaning contaminated soil, and treating groundwater.

Q: Can I sell my land without testing for contamination?
A: While testing isn’t always required, buyers may request environmental assessments. If contamination is suspected, testing and remediation may be necessary to complete the sale.

Q: How much does it cost to remove a UST?
A: Costs vary depending on the tank's size, condition, and whether contamination is present. Hiring an environmental specialist can provide an accurate estimate.

By addressing these issues proactively, sellers can ensure their land transaction proceeds smoothly while maintaining compliance with legal and environmental requirements.