SRC-LBB H.B. 1366 78(R)    BILL ANALYSIS


Senate Research CenterH.B. 1366
By: Elkins (Jackson)
Natural Resources
5-15-2003
Engrossed

DIGEST AND PURPOSE 

Under current law, there is no provision to fund a dry cleaning pollution
clean-up program.   H.B. 799 provides for a dry cleaning remediation
program controlled by the Texas Commission on Environmental Quality. 

RULEMAKING AUTHORITY

Rulemaking authority is expressly granted to the Texas Commission on
Environmental Quality in SECTION 1 (Sections 374.051, 374.052, and
374.053,  Health and Safety Code) of this bill. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Subtitle B, Title 5, Health and Safety Code, by adding
Chapter 374, as follows: 

CHAPTER 374.  DRY CLEANER ENVIRONMENTAL RESPONSE
SUBCHAPTER A.  GENERAL PROVISIONS

Sec.  374.001.  DEFINITIONS.  Defines "carbon dioxide facility,"
"chlorinated dry cleaning solvent," "commission," "corrective
action,""corrective action plan," "dry cleaning drop station," "dry
cleaning facility," "dry cleaning solvent," "dry cleaning unit,"
"executive director," "fund," "owner," and "release."  

Sec.  374.002.  APPLICABILITY OF OTHER LAW.  Establishes that to the
extent this chapter is inconsistent or in conflict with Chapter 361 or
other general law, this chapter prevails. 

Sec.  374.003.  APPLICABILITY TO GOVERNMENTAL BODIES.  Provides that this
chapter does not apply to a governmental entity, including a governmental
agency or prison or a political subdivision of this state. 

Sec.  374.004.  ADVISORY COMMITTEE.  (a)  Requires the executive director
of the Texas Commission on Environmental Quality (TCEQ) to appoint an
advisory committee (committee) composed of representatives of the dry
cleaning industry for the purpose of providing professional and practical
expertise to TCEQ and to take certain actions. 

  (b)  Requires the committee to perform certain functions.

(c)  Provides that a member of the committee serves at the will of the
executive director. 

[Reserves Sections 374.005-374.050 for expansion.]

SUBCHAPTER B.  RULES, STANDARDS, CRITERIA, AND REPORTS

Sec.  374.051.  COMMISSION RULES AND STANDARDS.  (a)  Requires TCEQ to
adopt rules necessary to administer and enforce this chapter.  Requires
rules adopted under this section to be reasonably necessary to preserve,
protect, and maintain the water and other natural resources of this state
and to provide for prompt corrective action of  releases from dry cleaning
facilities. 

  (b)  Requires TCEQ to adopt rules that establish certain standards.

Sec. 374.052.  FACILITY RETROFITTING.  (a)  Requires TCEQ  by rule to
require dry cleaning facilities operating on or before January 1, 2004, to
implement the performance standards adopted under Section 374.053 not
later than January 1, 2006.  

(b)  Authorizes TCEQ by rule to exempt businesses whose annual gross
receipts are $200,000 or less from the requirements of Subsection (a) on
the basis of financial hardship.  

  (c)  Provides that this section expires January 1, 2007.

Sec. 374.053.  PERFORMANCE STANDARDS FOR NEW DRY CLEANING FACILITIES.  (a)
Requires TCEQ by rule to adopt performance standards for a new dry
cleaning facility. 

(b)  Requires the rules adopted under this section to allow the use of new
technologies as they become available.  

(c)  Requires the rules adopted under this section to meet certain
requirements. 

(d)  Requires the rules adopted under this section to ensure that
wastewater from a dry cleaning unit or discharge of dry cleaning solvent
is not discharged to a sanitary sewer, to a septic tank, or to water of
this state. 

Sec.  374.054.  COMPLETION CRITERIA.  (a)  Requires TCEQ, in determining
whether a corrective action is complete, to consider factors listed under
Section 374.051(b)(3) and other requirements.  

(b)  Prohibits a deviation from a state water quality standard from
resulting in the application of a standard that is more stringent than the
applicable standard, in considering a deviation under Subsection (a)(3). 

Sec. 374.055.  CRITERIA FOR ADMINISTRATION OF CHAPTER.  (a)  Requires TCEQ
to administer this chapter in accordance with this section. 

(b)  Requires TCEQ, to the maximum extent possible, to deal with
contamination from dry cleaning  facilities by using money in the fund.  

(c)  Requires  TCEQ to use money from the fund as sites are discovered in
the normal course of TCEQ's business. 

(d) Requires TCEQ to consider interim or early corrective action that may
result in an overall reduction of risk to human health and the environment
and in the reduction of total costs of corrective action at a site. 

(e)  Authorizes TCEQ, in its discretion, to use innovative technology to
perform corrective action. 

(f)  Requires money in the fund, to the maximum extent possible, to be
used to address contamination resulting from releases.  

Sec.  374.056.  REPORT TO GOVERNOR AND LEGISLATURE.  Requires the
executive director, on or before December 1 of each even-numbered year, to
submit to the governor, lieutenant governor, speaker of the house of
representatives, and members of the appropriate standing committees of the
senate and the house of representatives a report regarding certain
information. 
 
[Reserves Sections 374.057-374.100 for expansion.]

SUBCHAPTER C.  FINANCIAL PROVISIONS

Sec.  374.101.  DRY CLEANING FACILITY RELEASE FUND.  (a)  Provides that
the dry cleaning facility release fund (fund) is an account in the general
revenue fund. 

(b)  Establishes that the fund consists of money from proceeds from
surcharges and fees imposed by this chapter; interest attributable to
investment of money in the fund; money recovered by the state under this
chapter, including any money paid under an agreement with TCEQ or as civil
penalties; and  money received by TCEQ in the form of gifts, grants,
reimbursements, or appropriations from any source intended to be used for
the purposes of this chapter. 

(c)  Authorizes money in the fund to be appropriated only to TCEQ for the
purposes of this chapter. 

(d)  Authorizes TCEQ, before September 1, 2005, to annually spend for
administrative and start-up expenses incurred in fulfilling its duties
under this chapter an amount of money from the fund not to exceed 15
percent of the amount of money credited to the fund in the same fiscal
year as the expenditures. Authorizes TCEQ to spend from the fund,
beginning on September 1, 2005, for those expenses an amount not to exceed
10 percent of the amount of money credited to the fund in the same fiscal
year. 

(e)  Requires TCEQ to use only money from the fund to pay for all expenses
incurred by TCEQ in fulfulling its duties under this chapter, subject to
the limitations of this chapter. 

(f)  Provides that Section 403.095, Government Code, does not apply to
money deposited to the fund. 

Sec. 374.102.  REGISTRATION; FEE; POSTING.  (a)  Requires each owner of an
operating dry cleaning facility or dry cleaning drop station to register
with TCEQ on a form provided by TCEQ. 

(b)  Requires the registration to be accompanied by a certain fee, except
for a carbon dioxide facility. 

  (c)  Requires fees under this section to be deposited to the credit of
the fund. 

(d)  Requires the owner of a dry cleaning facility to post the owner's
registration number, in a manner prescribed by TCEQ, in the public area of
each of the owner's operating dry cleaning facilities. 

  (e)  Requires each registration to be renewed annually.

Sec. 374.103.  FEE ON PURCHASE OF DRY CLEANING SOLVENT; DISPOSITION OF
PROCEEDS.  (a) Provides that a fee of $15 per gallon is imposed on the
purchase of the dry cleaning solvent perchloroethylene and $5 per gallon
on the purchase of any other dry cleaning solvent by an owner of a dry
cleaning facility, except as provided by Subsection (b) and Section
374.104(d).  Requires the person who distributes the solvent to pay the
fee to TCEQ. 

(b)  Provides that Subsection (a) does not apply to certain individuals or
purchases.  

(c)  Prohibits  a person who distributes a dry cleaning solvent from
selling the solvent for use in a dry cleaning facility unless the person
first obtains and records  the registration number of the owner of the
facility. 

(d)  Requires TCEQ to adopt any procedures needed for the collection,
administration, and enforcement of the fee imposed by this section and to
deposit all remitted fees to the credit of the fund. 

Sec. 374.104.  OPTION NOT TO PARTICIPATE IN FUND BENEFITS.  (a)
Authorizes the owner of a dry cleaning facility to file with TCEQ an
option for the facility not to participate in fund benefits.  

  (b)  Requires an option not to participate to be filed before January 1,
2004. 

(c)  Requires TCEQ to designate a facility as nonparticipating if the
owner demonstrates, at the owner's expense and in accordance with TCEQ
rules, that the owner has never used or allowed the use of
perchloroethylene at any dry cleaning facility in this state.  Requires
the owner to agree that  perchloroethylene will not be used as a dry
cleaning solvent at the facility. 

(d)  Provides that a facility designated as nonparticipating is not
subject to the fees on dry cleaning solvents, other than
perchloroethylene, under Section 374.103. 

(e)  Requires TCEQ, to issue a specially marked registration document to
the owner of a nonparticipating facility, on payment of the registration
fee.  Requires the owner to post the registration document in the public
area of the facility. 

(f)  Provides that after a facility is designated as nonparticipating the
owner is not eligible for any expenditures of money from the fund or other
benefits and the facility is prohibited from later becoming a
participating facility. 

Sec.  374.105.  NEW DRY CLEANING FACILITY BOND; EXCEPTION.  (a)  Requires
the owner of certain dry cleaning facilities to furnish TCEQ a bond or
other financial assurance authorized by TCEQ in the amount of $500,000 to
guarantee costs of any future corrective action that may be required at
the facility. 

(b)  Requires TCEQ to return the bond posted under this section on the
second anniversary of the date of closing of the dry cleaning facility for
use as a dry cleaning facility if TCEQ has certified that corrective
action is not required at the facility. 

(c)  Provides that this section does not apply to a carbon dioxide
facility that begins operation on or after September 1, 2003. 

[Reserves Sections 374.106-374.150 for expansion.]

SUBCHAPTER D.  RESPONSE TO RELEASE; CORRECTIVE ACTION

Sec.  374.151.  RESPONSE TO RELEASE.  (a)  Prohibits a  person from
intentionally allowing a release. 

(b)  Requires a person who knows of a release over a 24-hour period of
more than one quart of a chlorinated dry cleaning solvent or of more than
one gallon of a non-chlorinated dry cleaning solvent to immediately
contain and control the release and notify  TCEQ of the release before the
expiration of 48 hours after the person learns of the release. 

Sec. 374.152.  INVESTIGATION AND ASSESSMENT OF RELEASE; EMERGENCY ACTION.
(a)  Requires TCEQ, if a release or a potential release poses a threat to
human health or to the environment, take certain actions. 

 (b)  Authorizes emergency action under Subsection (a)(2) to include the
treatment, restoration, or replacement of drinking water supplies. 

Sec. 374.153.  CORRECTIVE ACTION.  (a)  Requires TCEQ,  subject to
Subchapter E, to take corrective action for a release from a dry cleaning
facility that results in contamination, including contamination that may
have moved off the dry cleaning facility. 

(b)   Provides that corrective action includes the cleanup of affected
soil, groundwater, or surface water using the most cost-effective method
that meets certain requirements.  

(c)  Requires TCEQ to take certain actions.

(d)  Requires TCEQ to ensure the removal and proper disposal of wastes
generated by a release. 

(e)  Requires TCEQ, except as provided by Subchapter E, to pay the costs
of corrective action conducted under this subchapter, regardless of
whether the corrective action is included in a corrective action plan. 

Sec. 374.154.  RANKING OF CONTAMINATED DRY CLEANING SITES.  (a) Requires
TCEQ, for a contaminated dry cleaning site that does not require emergency
action under Section 374.152, to assign a  rank  for the site relative to
other sites previously ranked and awaiting corrective action based on
information contained in the application for ranking. 

(b)  Provides that certain persons are eligible to apply for a site to be
ranked under Subsection (a). 

(c)  Establishes that if the applicant for ranking is not  an owner of the
real property, then the application is required to  include proof that an
owner of the real property has been notified of the application.
Establishes that if an applicant is an owner of the real property and the
facility is leased, the applicant is required to include proof that a
lessee has been notified of the application. 

(d)  Requires the applicant for ranking to contain information and
evidence required by TCEQ rule to aid in ranking.  Authorizes the
information and evidence required to include certain information. 

(e)  Requires the costs incurred by an applicant in collecting the
information and evidence under Subsection (d) to be credited against the
deductible payable by the applicant under Section 374.203(f). 

(f)  Requires TCEQ to notify the applicant of the relative ranking TCEQ
assigns the applicant's site on or before the 90th day after the date the
application is received by TCEQ. 

Sec. 374.155.  POWER TO MODIFY COMMISSION RANKINGS OR POSTPONE CORRECTIVE
ACTIONS.  Authorizes TCEQ to take certain actions. 

Sec. 374.156.  ENTRY ONTO PROPERTY.  (a)  Authorizes an authorized
officer, employee, or agent of TCEQ, or a person under order of or
contract with TCEQ, at reasonable times and on written notice to the owner
or occupant of any property or premises, to enter onto the property or
premises to take corrective action if the executive director determines
that the action is necessary to protect the public health or environment. 

(b)  Require TCEQ, if consent to enter is not granted by the person in
control of a  site that is the subject of a notice under this section, to
issue an order directing compliance with the notice.  Authorizes the order
to be issued only after providing the notice and opportunity for
consultation that are reasonably appropriate under the circumstances. 

[Reserves Sections 374.157-374.200 for expansion.]

SUBCHAPTER E.  LIABILITY AND RESPONSIBILITY.

Sec. 374.201.  PROPORTIONATE SHARE OF LIABILITY.  (a)  Authorizes TCEQ, at
a site with more than one source of contamination, to take certain
actions. 

(b)  Requires TCEQ to issue an order establishing the percentage of
liability.  Provides that the order is binding and controls the obligation
of the fund unless amended by TCEQ.  Specifies that, if an appeal from the
order is made, the percentage of liability established by the order must
control for costs incurred while the appeal is pending. 

Sec. 374.202.  OWNER RESPONSIBILITY.  (a)  Authorizes TCEQ to hold an
owner responsible for up to 100 percent of the costs of corrective action
attributable to the owner if TCEQ finds, that the owner failed to meet
certain requirements. 

(b)  Provides that to the extent that an owner is responsible for
corrective action costs under this subsection, the owner is not entitled
to the exemption under Section 374.207. 

Sec. 374.203.  LIMITATION ON USE OF FUND FOR CORRECTIVE ACTION.  (a)
Defines "contaminated dry cleaning site." 

(b)   Prohibits TCEQ  from using money from the fund for the payment of
costs in excess of $5 million for corrective action at a single
contaminated dry cleaning site. 

(c)  Prohibits TCEQ from using money from the fund for corrective action
at a contaminated dry cleaning site unless the owner applies for the
ranking under Section 374.154 and is not otherwise ineligible for
corrective action under this chapter or at the time corrective action is
to begin the site has been under the same ownership for not less than five
years. 

(d)  Requires the owner of a dry cleaning facility, or other person who
submits the application for ranking the facility under Section 374.154, to
pay as a deductible the first $5,000 of corrective action costs incurred
because of a release from the dry cleaning facility.  Authorizes TCEQ to
take corrective action regardless of whether it obtains the deductible. 

 Sec. 374.204.  LIMITATION ON LIABILITY.  Prohibits the fund, TCEQ, the
executive director, this state, or agents or employees of this state from
being held liable for loss of business, damages, or taking of property
associated with any corrective action taken under this chapter. 

Sec. 374.205.  LIMITATION ON USE OF FUND FOR THIRD PARTIES.  Prohibits
money from the fund from being used to compensate third parties for bodily
injury or property damage caused by a release, other than property damage
included in a corrective action plan approved by TCEQ. 

Sec. 374.206.  USE OF OTHER SOURCES OF MONEY.  Provides that this chapter
does not create a liability or responsibility on the part of TCEQ, the
executive director, this state, or agents or employees of this state to
pay any corrective action costs from a source other than the fund or to
take corrective action if the amount of money in the fund  is
insufficient. 

Sec. 374.207.  ELIGIBLE OWNER EXEMPT FROM CERTAIN CLAIMS.  Prohibits an
administrative or judicial claim from being made under state law against
the owner or other person by or on behalf of a state or local government
or by any other person to compel corrective action or seek recovery of the
costs of corrective action that result from the release, if an owner or
other person is eligible under this chapter to have corrective action
costs paid by the fund. 

Sec. 374.208.  UNAUTHORIZED PAYMENTS.  (a)  Authorizes TCEQ to pay costs
from the fund under this chapter only if the costs are integral to
corrective action for a release or required for the administration or
enforcement of this chapter. 

(b)  Prohibits TCEQ from spending money from the fund for certain purposes.

[Reserves Sections 374.209-374.250 for expansion.]

SUBCHAPTER F.  REVIEW OF ORDERS AND DECISIONS; VIOLATIONS; 
PENALTIES; EXPIRATION

Sec. 374.251.  REVIEW OF ORDERS AND DECISIONS.  (a)  Authorizes a person
affected by a TCEQ order or decision under this chapter, on or before the
15th day after the date of service of the order or decision,  to make a
written request for a hearing.  

(b)  Provides that a person affected by the decision in an administrative
hearing under Subsection (a) is entitled to judicial review and may appeal
the decision on or before the 31st day after the date on which the
decision was rendered. 

Sec. 374.252.  VIOLATIONS; PENALTIES.  Provides that a person is subject
to an administrative penalty under Section 7.0525, Water Code, if the
person meets certain requirements. 

Sec.  374.253.  EXPIRATION.  (a)  Provides that this chapter expires on
September 1, 2021. 

(b)  Requires a corrective action, including any administrative duties
associated with an action, for which remediation of a contaminated site
has begun before September 1, 2021, to be completed in accordance with
this chapter using money from the fund, to the extent possible, but
prohibits money from being collected for or added to the fund on or after
that date. 

(c)  Prohibits a corrective action that has not progressed beyond the
investigative or planning stage on September 1, 2021, from being paid for
using money from the fund. 

(d)  Requires any unobligated money remaining in the fund after the
completion of all corrective actions under Subsection (b) to be
transferred to the general revenue fund to the credit of TCEQ or a
successor agency.  Provides that the fund is abolished on the date of the
transfer. 

SECTION  2.  Amends Subchapter C, Chapter 7, Water Code, by adding Section
7.0525, as follows: 

Sec.  7.0525.  PENALTIES FOR VIOLATIONS RELATED TO CERTAIN DRY CLEANING
FACILITIES.  (a)  Establishes that except as provided by Subsection (b),
the amount of the penalty for a violation of Section 374.252, Health and
Safety Code, may not exceed $5,000. 

(b)  Prohibits  the amount of the penalty for a violation of Section
374.252(a)(1),  Health and Safety Code, from exceeding $1,000. 

(c)  Requires TCEQ, in assessing an administrative penalty under this
section, in addition to the factors prescribed by Section 7.053, to
consider certain other factors.   

SECTION 3.  (a)  Requires TCEQ, not later than December 1, 2003, to adopt
any rules, performance standards, or forms required for the implementation
of Chapter 374, Health and Safety Code, as added by this Act. 

(b)  Provides that performance standards for new dry cleaning facilities
under Section 374.053, Health and Safety Code, as added by this Act, apply
only to a dry cleaning facility first brought into use on or after April
1, 2004. 

(c)  Provides that the changes in law made by Sections 374.204 and
374.207, Health and Safety Code, as added by this Act, apply only to a
cause of action that accrues on or after January 1, 2004, and before
September 1, 2021.   Provides that a cause of action that accrued before
January 1, 2004, or after September 1, 2021,  is subject to the law
governing the action that was in effect when the action accrued, and that
law is continued in effect for that purpose. 

(d)  Provides that Chapter 374, Health and Safety Code, as added by this
Act, does not apply to any corrective actions taken by the Texas
Commission on Environmental Quality at a dry cleaning facility as defined
by Section 374.001, Health and Safety Code, as added by this Act, before
the effective date of this Act. 

SECTION 4.  (a)  Provides that this Act takes effect September 1, 2003,
except as provided by this section. 

(b)  Requires TCEQ, before January 1, 2005, to limit disbursements from
the dry cleaning facility release fund to those disbursements allowed by
Section 374.101(d), Health and Safety Code, as added by this Act. 

(c)  Prohibits disbursements from the dry cleaning facility release fund
for a corrective action taken under  Chapter 374, Health and Safety Code,
as added by this Act, from beginning before January 1, 2005. 

(d)  Provides that Sections 374.056, 374. 204, 374.207,  and 374.252,
Health and Safety Code, as added by this Act, take effect January 1, 2004.