BILL ANALYSIS



H.B. 843
By: Alexander
April 17, 1995
Committee Report (Amended)


BACKGROUND

In the fall of 1992, the Texas Natural Resource Conservation
Commission (TNRCC) shut down the Petroleum Storage Tank Remediation
(PSTR) fund, suspending all reimbursements because of claims $150
million in excess of money available.  Since the fund was
established as a state financed insurance program in compliance
with federal requirements, closing the fund left the state
vulnerable to sanctions by the Environmental Protection Agency
(EPA).  As a consequence, this action alarmed small tank owners in
Texas, many of which could not find or afford private tank
insurance. 

Current law (Subchapter I, Chapter 26 Water Code and Vernon's Texas
Civil Statutes, Section 403.092) provided for a loan of $120
million to the PSTR fund from general revenue ($60 million for each
year of the biennium) in order that claims submitted as of August
31, 1993 by eligible tank owners could be paid.  The act also
provided that the full amount of the fees collected would go
directly to the general revenue fund until the loan was repaid. 
When the fund was temporarily shut down, the PST Division of the
TNRCC notified tank owners in writing that there would be no
reimbursements for remediation work until the general revenue loan
is repaid.

During the interim, Lieutenant Governor Bullock and Speaker Laney
appointed a six member Joint Interim Committee on Petroleum Storage
Tanks to review the administration and procedures of the PSTR Fund
and to review all state and federal laws and agency rules governing
the PSTR Fund and the PST program at the TNRCC.  This bill
addresses several of the Interim Committee's recommendations
concerning the solvency of the PSTR Fund.

At this time, there is a two-year backlog of claims upon the PSTR
fund dating from September 1, 1993.  The fees assessed on petroleum
products upon delivery to tanks are not sufficient to fund all
claims received. 

PURPOSE

House Bill 843 provides for the solvency of the Petroleum Storage
Tank Remediation Fund and allows for remediation of contaminated
PST sites to continue as required by Texas' "Groundwater Protection
Act" and the federal "Resource Conservation and Recovery Act".

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly
grant any additional rulemaking authority to a state officer,
department, agency or institution.

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Subchapter I, Chapter 26, Water Code, by adding
Section 26.35731 providing for equal access to the Petroleum
Storage Tank Remediation Fund by all eligible claimants and
requires that claims be paid in the order they are received by the
TNRCC.

SECTION 2.  Amends Section 26.3574 (b), Water Code, by doubling the
current fee charged for delivery of petroleum products into cargo
tanks; amends Section 26.3574 (x), Water Code, by lowering the cap
on the unobligated balance in the Petroleum Storage Tank
Remediation Fund from $100 million to $50 million. Once this cap is
reached the assessment of delivery fees is suspended; amends
Section 26.3574(y), Water Code, by requiring that if the
unobligated fund balance drops below $25 million and the delivery
fee is reinstated, it is assessed at 1/2 the fee set by Section 2
of this bill.

SECTION 3.  Amends Section 403.092 (c)(1), Government Code,
changing the fiscal biennium specified in law so that the
Comptroller may transfer funds, not to exceed $120 million, from
the general revenue fund to the petroleum storage tank remediation
fund in the 1996-1997 biennium, and changes the date that the
transfer takes place; amends Section 403.092 (c)(2), Government
Code, by requiring that one-half of the fees collected under
Section 26.3574, Water Code, be deposited directly into the general
revenue fund until the deposits equal the amount of the temporary
loan made by the Comptroller; further requires that the remaining
money collected under Section 26.3574 be deposited directly into
the petroleum storage tank remediation fund so that the clean-up of
contaminated petroleum storage tanks sites can continue; amends
Section 403.092 (c)(4), Government Code, by providing for the
expiration of this subsection after August 31, 1997, or the date
that the temporary transfer made by the comptroller under Section
403.092 (c)(1), is repaid in full.  This subsection ensures that
any loan to the PSTR fund must be mandated by statute. 

SECTION 4.  Effective date of September 1, 1995.

SECTION 5.  Emergency Clause.


EXPLANATION OF AMENDMENTS

The amendment places a firm deadline on tank registration and
prohibits reimbursement from the PSTR fund for tanks not registered
by that date; postpones reimbursement for remediation work if prior
commission approval was not sought while prior approval rules were
in place until after work pre-approved by the commission has been
reimbursed; provides for complete repayment of the loan from GR
before the fees can be reduced upon reaching the fund balance of
$50 million; provides a repayment schedule to the general revenue
fund; allows the TNRCC to authorize privatization of any part of
the program; and provides for the sunset of the reimbursement
portion of the PST program.

SUMMARY OF COMMITTEE ACTION

HB 843 was considered in a full committee public hearing on March
21, 1995. Gilbert Herrera, Consultant, Dan Pearson, Executive
Director of the TNRCC, and Joe Woodard, PST Division of the TNRCC
testified on the bill.  The bill was left pending in committee.  HB
843 was taken up and considered again in a full committee public
hearing on April 12, 1995.  No witnesses testified on the bill.  An
amendment was offered by Chairman Junell and adopted without
objection.  The motion to report the bill favorably, as amended, to
the Committee on Calendars carried by a vote of 18 ayes, 0 nays, 0
PNV and 9 absent.