STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
EVERGLADES PIPE LINE COMPANY, )
)
Petitioner, )
)
vs. ) CASE NOS. 87-5305
) 87-5374
DEPARTMENT OF ENVIRONMENTAL ) REGULATION, )
)
Respondent. )
)
RECOMMENDED ORDER
Pursuant to notice, the above matter was heard before the Division of Administrative Hearings by its duly designated Hearing Officer, Don W. Davis, on April 28, 1988 in Miami, Florida. The following appearances were entered:
APPEARANCES
For Petitioner: Richard A. Pettigrew, Esquire
Luis R. Figueredo, Esquire
5300 Southeast Financial Center
200 South Biscayne Boulevard Miami, Florida 33131-2339
For Respondent: E. Gary Early, Esquire
Department of Environmental Regulation 2600 Blair Stone Road
Twin Towers Office Bldg. Tallahassee, Florida 32399-2400
BACKGROUND
The Respondent administers the Inland Protection Trust Fund and provides reimbursement to eligible applicants for certain expenses associated with site clean up of environmental contamination resulting from storage of petroleum and petroleum products. The reimbursement program was established in the State Underground Petroleum Environmental Response (SUPER) Act of 1986, and is codified in section 376.3071(12), Florida Statutes.
The Respondent denied reimbursement eligibility for facilities at two of Petitioner's sites on the basis that neither facility constituted a petroleum storage system as defined in section 376.301(11), Florida Statutes. In each instance of denial, the Petitioner requested a formal administrative hearing. This consolidated hearing on both denials followed.
Prior to the hearing, argument of the parties was heard regarding the Petitioner's Motion in Limine. In summary, the motion was a response to the Respondent counsel's assertion to the Petitioner, less than a week before the hearing, that Petitioner must show contamination of the Petitioner's sites from
leakage of Petitioner's tanks as part of a "prima facie case." Petitioner was expected to bear the "burden of proof" with regard to this additional issue.
The original basis for Respondent's denial was that the Petitioner's facilities were deemed not to be petroleum storage facilities within the context of the statutory definition set forth in section 376.301(11), Florida Statutes. Therefore, the Petitioner's motion sought to have the hearing restricted solely to the reasons set forth in Respondent's denial letters of May 19 and October 18, 1987, and prohibit the Respondent from even referring to any additional grounds for denial not previously explicated in accordance with subparagraph 3 of subsection 376.3071(12)(f), Florida Statutes, which provides in pertinent part that:
Final disposition of an application shall be provided to the applicant in writing accompanied by a written explanation setting forth in detail the reason or reasons for the approval or denial.
The motion of Petitioner was denied. The Respondent's counsel was instructed that evidence could be presented or elicited by the Respondent regarding the contamination issue, provided that Petitioner would only be required to go forward with evidence in response to the reasons set forth in the letters of denial.
At hearing, the Petitioner presented testimony of two witnesses.
Petitioner also introduced exhibits 1-8; composite exhibit 11, which consists of sub-parts (A) through (S); and exhibits 12-19, 23, and 26-32. The Respondent presented testimony of two witnesses. Proposed findings of facts submitted by the parties are addressed in the appendix to this recommended order.
Based upon all of the evidence, the following findings of fact are determined:
FINDINGS OF FACT
The parties stipulated at hearing to the factual findings set forth in paragraphs 1-5 below.
Stipulated Facts
The Petitioner has four underground tanks. Two tanks are located at Petitioner's facility in Port Everglades and two tanks are located at Petitioner's facility at Miami International Airport. All four tanks are registered as "stationary tanks" with Respondent.
The Petitioner filed a request for reimbursement with the Respondent pursuant to section 376.3071(12)(b), Florida Statutes.
The Respondent's denial with regard to the facility at each site was based on "...the fact that this facility is not a petroleum storage system as defined in section 376.301(11), Florida Statutes."
Subsequent to the Respondent's denial of the Petitioner's application, the Respondent conducted an additional inspection of the Port Everglades site.
The Petitioner timely filed a petition for a formal administrative hearing in response to Respondent's denial.
Other Facts
Petitioner, Everglades Pipeline Company, is a single, unified pipeline facility. The sole purpose of the system is to transport petroleum product along a route from a receiving pumping station at Port Everglades via a 35 mile pipeline to various terminals and ending at a terminal at the Miami International Airport. The pipeline facility transports 400 to 3000 barrels of petroleum product per hour. The petroleum product transported by Petitioner usually consists of jet A turbine fuel, JP-4 military fuel and railroad diesel fuel.
Various pipe lines, not owned or operated by Petitioner, transport petroleum product from major petroleum companies to the Petitioner's receiving station at Port Everglades where the product enters the Petitioner's pipe line facility. The process of placing the petroleum product in the care of Petitioner is known as a "custody transfer." While the product is in Petitioner's custody for purpose of transport to its destination, ownership of the product does not change. At all times, the product remains the property of the company acquiring the Petitioner's transportation service.
After transfer to the Petitioner's custody and during the transportation process, tests are constantly performed on the product for the purpose of maintaining quality control. During the testing process, an amount of the petroleum product is withdrawn from the pipeline through a one fourth inch pipe. Samples for testing purposes are then taken from the quantity of the product so removed. The excess of that quantity is channeled to two underground tanks at the Everglades station and temporarily held there for later injection back into the pipeline for delivery, with the same batch of product from which it was drawn, to the recipient at the other end of the pipeline journey.
In the Miami station, the same process of withdrawal of a quantity of the product occurs, with two underground tanks there fulfilling the same holding function as that performed by the tanks at the Port Everglades facility.
While each of the four tanks have been registered as required by section 376.301(11), Florida Statutes, such registration is not deemed dispositive of whether the tanks are petroleum storage systems since registrations are accepted at face value by the Respondent and no independent verification of registration is made.
The two tanks at the Everglades facility have a 2100 gallon, or approximately 50 barrel, capacity. The two tanks at the Miami facility have a 1764 gallon capacity.
These four tanks, known as "sump" tanks, perform other functions in addition to temporarily holding amounts of product from which samples are taken. Strainers in the pipeline sometimes become clogged from impurities in the product being transported. When this happens, the product is back washed within the pipeline through the strainers to unclog them. The product used in this back wash operation is then cleansed and placed in the tanks for subsequent re- injection in the pipeline with the batch of product from which it originated. The contaminants are placed in a strainer tank. The strainer tank is necessary
for the effective operation of the pipeline. It was conceded in testimony of Petitioner's witness at hearing that this tank is not a petroleum storage system.
Maintenance of the system sometimes requires the draining of product from the pipeline into the sump tanks. As soon as the maintenance is completed, the product is re-injected into the pipeline with the batch from which it was drawn. A safe pipeline system requires the existence of the sump tanks to hold maintenance drainage material.
The tanks at the Port Everglades station are also used to hold product when pressure builds up in the pipeline system from thermal causes or other conditions which require that pressure in the system be relieved. The product drawn off at these times is re-injected in the pipeline into the batch of product from which it originated. Some form of pressure relief is necessary for safe and effective operation of the pipeline system.
The process of reinserting the product back into the pipeline is a manual operation to the extent that personnel are required to open certain valves. The product is not automatically re-injected. However, the sump tanks exist solely to "take care of the individual stations or terminal." While possible to operate the pipeline without the tanks, there is no use or purpose for them except as part of the pipeline facility.
An additional tank exists at the Port Everglades station as part of a scavenger system for recovery of product from the ground, but no evidence was presented to show the tank was stationary or registered. The tank is not a petroleum storage system pursuant to section 376.301(11), Florida Statutes.
In addition to the two sump tanks, two barrel shaped tanks sit above the ground at the Miami International Airport terminal. These tanks have the capacity to hold 1000 barrels or 42,000 gallons of petroleum product. Neither of these tanks is registered with the Department, nor was evidence introduced that they were otherwise licensed or comply with petroleum storage system requirements of section 376.301(11), Florida Statutes.
These barrel tanks were identified at hearing as a relief tank and a settling tank. The relief tank serves the same purpose of providing pressure relief for the system as do the sump tanks at the Port Everglades station. As with the sump tanks, the product is re-injected into the pipeline as soon as the upset condition causing overpressurization is past. The tank also serves to hold certain types of contaminated product until the owner can remove it from the system.
The other barrel tank at the Miami station is used as a "settling" tank to filter contaminants from petroleum product. This tank is a treatment or process tank, as opposed to a petroleum storage system.
The barrel tanks at the Miami Station, like the sump tanks there and at the Port Everglades station, serve only the product transportation function of the pipeline. They are necessary for safe and effective functioning of that transportation system.
Each of the Petitioner's tanks is integrally related to the transportation of product from Port Everglades to Miami. Their sole purpose is the safe and effective functioning of the pipeline. As established by testimony of John Svec, Respondent's expert on petroleum storage facilities, the
Petitioner's tanks function for the convenience of the transportation system. The process of taking the product out of the pipe line, holding it, and putting it back into the pipe line is a transportation function.
While the Petitioner's tanks temporarily hold petroleum product, they do not store that product in order to provide a supply for future use within the context of that term's use in the field of petroleum marketing. The term "supply" means the buying or selling of product. The Petitioner does not engage in buying and selling. Custody of materials is assumed solely for transportation of that material by the Petitioner's facility. The holding function of the tanks is a part of the overall purpose of the entire pipeline facility to transport petroleum product.
Petitioner's exhibit 11 establishes that the original Senate version (Senate Bill 206) of the SUPER Act of 1986 made no mention of pipeline facilities for purpose of inclusion under coverage of the Act. The committee substitute for Senate Bill 206 did include pipelines. This inclusion was carried over to the committee substitute for the committee substitute, only to be deleted from the final enrolled version of the Act.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the subject matter of this proceeding, and the parties thereto, pursuant to subsection 120.57(1), Florida Statutes.
The State Underground Petroleum Environmental Response (SUPER) Act of 1986 was enacted to provide for the expeditious cleanup of property contaminated as the result of the storage of petroleum or petroleum product. Chapter 86-159, Laws of Florida (1986). The Act recognizes the vulnerability of Florida's groundwater to contamination and provides several mechanisms by which cleanups of contamination resulting from storage of such products may be funded.
Sections 376.30(1), and 376.3071(1), Florida Statutes. The purpose of programs under the Act is to avoid delays in cleanups as a result of litigation and liability determinations.
As part of the Act, the legislature created the reimbursement program which is the subject of this litigation. In section 376.3071(12), Florida Statutes, provision is made for the reimbursement by the state of costs incurred in the cleanup of sites contaminated as the result of storage of petroleum or petroleum product. To be eligible for reimbursement of such costs, the applicant must maintain a "petroleum storage system" in accordance with the following definition in subsection 376.301(11), Florida Statutes:
"Petroleum storage system" means a stationary tank not covered under the provisions of chapter 377, together with any on-site integral piping or dispensing system associated therewith, which is used, or intended to be used, for the storage or supply of any petroleum
product as defined herein, and which:
Is registered with the Department of Environmental Regulation under this chapter or any rule promulgated pursuant hereto;
Is located in a terminal facility registered with the Department of Natural Resources under this chapter or any rule promulgated pursuant hereto;
Is located in a storage facility licensed with the Department of
Revenue under s. 206.022 or s. 206.9930, excluding off-site pipelines;
Is a system with respect to which notification has been submitted to the Department of Environmental Regulation under s. 376.303; or
Is a system with respect to which notification has been submitted to the appropriate state agency under Subtitle I of the Resource Conservation and Recovery Act.
The Respondent, under the provisions of Chapter 376, Florida Statutes, is charged with responsibility for implementing and administering the reimbursement program. In the exercise of that responsibility, the Respondent has determined that the Petitioner's facility is a transportation facility as opposed to a storage facility, thereby rendering Petitioner ineligible for reimbursement.
The Petitioner contends that since the sump tanks at the Everglades and Miami facilities are registered, they should be deemed to meet the definitional requirements set forth above and thereby permit reimbursement of clean up expenses at the Port Everglades and Miami terminals.
The tank facilities operated by the Petitioner do not comport with the aforementioned statutory definition in its requirement that an eligible system be one "used, or intended to be used, for the storage or supply" of petroleum product. The Petitioner's system is not a "storage" system. It is a part of a transportation system. In the very same sense, the four sump tanks do not comprise a supply system for the Petitioner's pipeline facility since each tank may only temporarily hold relatively minute quantities (approximately 50 barrels maximum) of product from which testing samples have been taken, as opposed to the voluminous amount of product needed to meet the transport capability (approximately 3000 barrels per hour) of the Petitioner's pipeline. A supply is an "available aggregate of things needed or demanded." See, Blacks Law Dictionary, 4th Edition, 1957. Further, if "supply" is intended by the statute to be used in the context of business dealings, the facts adduced at hearing establish that providing a supply of product within the petroleum industry involves buying and selling. As established at the hearing, the Petitioner does not buy or sell the product, but merely transports it.
A plain reading of the statutory definition does not reveal that pipeline facilities of the type operated by the Petitioner are eligible recipients for reimbursement. The Petitioner would urge the conclusion in this instance that a pipeline is "integral piping" of 35 miles, carrying a volume of product ranging from 400 to 3000 barrels per hour, which should qualify a tank, temporarily holding 50 barrels or less, as a "petroleum storage system." Such a
contention is not, however, persuasive. If the legislature intended the inclusion of pipeline transportation facilities within the subject definition, it would have so stated. In fact, the contrary is clearly indicated by the exclusion of pipelines from the final legislative version. The legislature's "deliberate use of a quite different term ... is strong evidence indeed that it intended a quite different meaning." Ocasio v. Bureau of Crimes Compensation, Division of Workers Compensation, 408 So.2d 751 (Fla. 4th DCA 1982).
The legislative use of the word "system" indicates that a review of the overall system of an applicant under consideration is appropriate. See, Island Harbor Beach Club Ltd. v. Department of Natural Resources, 495 So.2d 209 (Fla. 1st DCA 1986). When considering whether a piece of equipment is a storage system, the Department is justified in evaluating the overall purpose of the system or facility as opposed to viewing an individual component in isolation. Here, the proof establishes that the Petitioner's system is a unified mechanism for the transportation of petroleum product, not storage. The sump tanks, but for their service to the transportation system, would serve no purpose whatsoever. Agency exercise of delegated legislative authority should not be overturned unless shown by a preponderance of the evidence to be arbitrary, capricious or an abuse of discretion. Island Harbor, at 218; Agrico Chemical Company v. Department of Environmental Regulation, 365 So.2d 759 (Fla. 1st DCA 1979).
The legislature clearly distinguishes "storage" from "transportation" as evidenced by the separate enumeration of those terms in subsections (2) and
(3) of section 376.30, Florida Statutes. Given this legislative distinction, the Respondent has acted reasonably in determining the types of systems which fall within the ambit of section 376.3071, Florida Statutes. See, Ocasio, supra. The Respondent's consideration of the type of system involved is not arbitrary, capricious or an abuse of discretion, since Petitioner's system is a means of transport of fuel between Port Everglades and Miami, and since the sump tanks are essential to the effective operation of that system.
Notably, only the four sump tanks meet the threshold burden of registration, license or notification filing as required by section 376.301(11), Florida Statutes. Therefore, cleanup of discharges associated with the scavenger tank, the above-ground tanks and any other tanks at Petitioner's terminals are not eligible for reimbursement consideration.
The construction given to Chapter 376, Florida Statutes, by the Respondent is entitled to great deference and should be upheld unless clearly erroneous. Department of Insurance v. Southeast Volusia Hospital District, 438 So.2d 815, 820 (Fla. 1983).
The Respondent's construction of the term "petroleum storage system" in section 376.301(11), Florida Statutes, to exclude the Petitioner's transportation sump tanks is adequately supported by the record in this proceeding. The determination to exclude the Petitioner's tanks from that statutory definition has a reasonable and rational basis.
Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a final order be entered denying the Petitioner's
application for reimbursement eligibility.
DONE AND RECOMMENDED this 17th day of June, 1988, in Tallahassee, Leon County, Florida.
DON W. DAVIS
Hearing Officer
Division of Administrative Hearings The Oakland Building
2009 Apalachee Parkway
Tallahassee, Florida 32399-1550
(904) 488-9675
Filed with the Clerk of the Division of Administrative Hearings this 17th day of June, 1988.
APPENDIX TO RECOMMENDED ORDER, CASE NOS. 87-5374, 87-5305
The following constitutes my specific rulings, in accordance with section 120.59, Florida Statutes, on findings of fact submitted by the parties.
PETITIONER'S PROPOSED FINDINGS
Included, finding 1 and 6.
Included, finding 13.
Rejected as unnecessary for result reached.
Rejected, unnecessary to result reached.
Rejected, unnecessary to result reached.
Rejected, unnecessary to result reached.
Rejected, unnecessary to result reached.
Included in finding 8.
Summarily included in finding 11.
Summarily included in finding 14.
Summarily included in finding 16 with exception of the last two sentences. Testimony on this point indicated holding tanks do provide relief for system pressures.
Rejected, unnecessary to result reached.
Generally included throughout findings.
Not necessary for result reached.
Not necessary for result reached.
As to manual valves, included in finding 17. Remainder rejected as unnecessary for result reached.
Opinion as to tanks rejected as unnecessary to conclusion reached concerning the system.
Unnecessary to result reached.
Unnecessary to result reached.
RESPONDENT'S PROPOSED FINDINGS
Unnecessary to result.
Unnecessary to result.
Unnecessary to result.
Included in finding 6.
Included in finding 6.
Included in finding 6.
Included in finding 7.
Included in finding 12 and 13.
Included in finding 8.
Included in finding 14.
Included in finding 15.
Included in finding 16.
Included in finding 17.
Included in finding 20.
Included in finding 18.
Included in finding 19.
Included in finding 20.
Included in finding 21.
Included in finding 23.
Included in part in finding 21. Remainder rejected as unnecessary.
Included in finding 23.
Included in part in findings 23 and 24.
Included in finding 24.
Included in finding 24.
Included in finding 25.
COPIES FURNISHED:
Richard A. Pettigrew, Esquire Luis R. Figueredo, Esquire
5300 Southeast Financial Center
200 South Biscayne Blvd. Miami, Florida 33131-2339
E. Gary Early, Esquire Department of Environmental
Regulation
2600 Blair Stone Road Twin Towers Office Bldg.
Tallahassee, Florida 32399-2400
Daniel H. Thompson, Esquire
Department of Environmental Regulation Twin Towers Office Bldg.
2600 Blair Stone Road Tallahassee, Florida 32399-2400
Dale Twachtmann Secretary
Department of Environmental Regulation Twin Towers Office Bldg.
2600 Blair Stone Road Tallahassee, Florida 32399-2400
=================================================================
AGENCY FINAL ORDER
=================================================================
STATE OF FLORIDA DEPARTMENT OF ENVIRONMENTAL REGULATION
EVERGLADES PIPE LINE COMPANY,
Petitioner,
vs. | OGC FILE NOS. | 87-0752 |
87-1591 | ||
STATE OF FLORIDA DEPARTMENT | DOAH FILE NOS. | 87-5374 |
OF ENVIRONMENTAL REGULATION, | 87-5305 |
Respondent.
/
FINAL ORDER
On June 17, 1988, a hearing officer from the Division of Administrative Hearings submitted to me and all parties his Recommended Order, a copy of which is attached as Exhibit A. On June 28, Petitioner, Everglades Pipeline Company (Everglades), filed its exceptions to the Recommended Order, a copy of which is attached as Exhibit B. On July 12, Respondent, Department of Environmental Regulation (Department), filed its response to the exceptions, a copy of which is attached as Exhibit C. The Recommended Order thereafter came before me as Secretary of the Department for final agency action.
INTRODUCTION
This case concerns the extent to which the reimbursement provisions of Florida's Super Act program, as contained in Section 376.3071(12), Florida Statutes, cover the costs of cleanup of petroleum product spills caused by leaks from tanks that are part of a pipeline transportation system. The Super Act provides, in section 376.3071, Florida Statutes, for state cleanup, (the Early Detection Incentive or "EDI" program) or reimbursement for private cleanup (the reimbursement program) of contamination related to the storage of petroleum or petroleum products. Very recently, in Puckett Oil Company and International Petroleum Corporation v. DER, OGC File Nos. 87-0603 and 87-0029 (Final Order dated September 2, 1988), in a case of first impression interpreting the Super Act, I provided an extensive discussion of the extent to which persons are entitled to eligibility under the Act for reimbursement for spills of petroleum
and petroleum products as defined in the Act. Among other things, I concluded that eligibility exists "only if the contamination results from spills related to its storage in petroleum storage systems." (Id. at 7)
The key issue here is whether Everglades' four tanks fit the definition of "petroleum storage system" contained in Section 376.301(11), Florida Statutes. While there was no question that the tanks contain petroleum product, the Department denied eligibility on the grounds that the Everglades facilities are not petroleum storage systems. In considering Everglades' challenge to that decision, the hearing officer found that the tanks in question perform various tasks as part of a 35 mile pipeline, which begins at a receiving pumping station at Port Everglades and ends at a terminal at the Miami International Airport.
These tasks include backwashing, testing, pressure relief and settling to filter out contaminants, all of which were found to be either necessary to safe pipeline operation or without any use or purpose other than as part of the pipeline facility. The four tanks temporarily hold at most 50 barrels in comparison to the approximately 3000 barrels per hour that can travel through the pipeline. Based upon these findings the hearing officer concluded that reimbursement should be denied because the tanks serve only a product transportation function, not a storage one, and that the tanks are therefore not part of a petroleum storage system.
RULING ON EXCEPTIONS
Everglades filed seven exceptions to the hearing officer's findings of fact and six exceptions to his conclusions of law. They will be discussed as follows:
Exceptions to Findings of Fact
Exception No. 1. Everglades excepts the hearing officer's alleged failure specifically to find that Everglades maintains terminal facilities, one at the Miami airport and one at Port Everglades; and that the terminal facilities have various purposes, including quality control testing. Paragraph 6 of the Recommended Order specifically acknowledges a terminal at the Miami airport and a pumping station at Port Everglades. Whether or not a pumping station is the same as a terminal facility, the distinction has no bearing on the outcome of this case. At any rate, it should be noted that Everglades' own witness, Mr.
Larry Skelley, refers to the Port Everglades facility as a pumping station. (T-
6) Regarding the testing function role, the hearing officer specifically acknowledges this in paragraph 8 of the Recommended Order. This exception is therefore rejected.
Exception No. 2. Everglades excepts the hearing officer's purported finding that the pipelines are not owned or operated by Everglades. I do not read the Recommended Order, paragraphs 6 and 7, as saying this. The hearing officer found Everglades to be "a single, unified pipeline facility, "which transfers petroleum products along a 35 mile pipeline from the receiving pumping station at Port Everglades to Miami International. He found that various pipelines not owned by Everglades transport petroleum products to the Port Everglades pumping station. It is clear from reading the Recommended Order as a whole that the pipelines not owned by Everglades are those that connect to the pumping station at the beginning of the pipeline, and not the 35 mile pipeline itself. This exception is therefore rejected.
Exception No. 3. Everglades excepts the hearing officer's failure to make a specific finding that once the petroleum product reaches the airport it is
commonly transferred from the pipeline directly to an end user. Everglades' Proposed Findings of Fact, Conclusions of Law and Recommended Order did not request a finding stated as such, though it proposed a somewhat similar finding at paragraph 7, which was rejected by the hearing officer in the Appendix to Recommended Order as being unnecessary to the result. I concur with the conclusion of the hearing officer. While, as I stated in Puckett, supra, the ultimate disposition of a petroleum-based product may have a bearing on whether it is a "petroleum product" as defined in Section 376.301(10), Florida Statutes, that ultimate disposition has no impact in this case, since there was no dispute here that petroleum product was the contaminant being cleaned up. The critical question here is whether the petroleum product is being stored or transported.
The answer is found in how the product is being utilized onsite, and not upon its ultimate disposition somewhere else. Therefore, this exception is rejected as irrelevant.
Exception No. 4. Everglades' next exception focuses on whether the hearing officer ignored the Department's own expert witness, Mr. John Svec, in excluding the temporary holding function of Everglades' tanks from the definition of storage. A review of the transcript (T-121-132) indicates that Mr. Svec's statement is being used by Everglades out of context and in response to a hypothetical question. In response to the specific facts of this case, Mr.
Svec's testimony was clear that the tanks in this case served no purpose other than to service the transportation function of the pipeline. (T-124-125) In paragraphs 23 and 24 of the Recommended Order the hearing officer made specific findings, referencing Mr. Svec's testimony, that any temporary holding of the petroleum product served a transportation function, and not a storage one for the purpose of supplying the product for future use. Based upon a review of the complete record, I find that there was competent substantial evidence of record to support the hearing officer's finding in this regard. Section 120.57(1)(b)10., Florida Statutes, precludes me from rejecting or modifying this finding. See Heifetz v. Department of Business Regulation, 475 So.2d 1277 (Fla. 1st DCA 1985). Therefore, this exception is rejected.
Exception No 5. Everglades next excepts the hearing officer's finding that the tanks at the Port Everglades station are used to store petroleum product when pressure builds up on the pipeline system. Even assuming such a finding is inaccurate, Everglades does not explain how such error has any bearing on the underlying proceeding. The critical finding by the hearing officer, supported by competent substantial evidence, is that the sole purpose of the tanks is the safe and effective functioning of the pipeline. (Recommended Order at 23) Everglades does not suggest that the excepted finding would detract in any way from this critical finding. The exception is therefore rejected as irrelevant.
Exception No. 6. Everglades sixth exception alleges that the hearing officer ignored the evidence of two witnesses to the effect that the pipeline performs a storage as well as a transportation function. As noted in the Department's response to this exception, there is ample evidence to support contrary evidence. (T-6, 18, 14-48, 112-113, 115-117, 121-122, 124-125) The
hearing officer had the opportunity to consider the evidence and weigh the demeanor of the witnesses, and I shall not disturb his findings, based as they are on competent substantial evidence. This exception is therefore rejected.
Exception No. 7. Everglades last factual exception alleges yet another sin of omission, which it characterizes as the failure of the hearing officer to realize the importance of the Legislature's insertion of "offsite" before "pipelines" in the final version of the Super Act. First, it should be noted that the Super Act provides coverage only for "onsite integral piping or
dispensing systems" associated with a storage tank. Section 376.301(11), Florida Statutes. As explained in further detail in response to the second legal exception below, the words "offsite pipelines" have meaning only as a subset to the basic definition. Using the more appropriate terminology, Everglades then argues that the Legislature "intended for all onsite piping associated with terminal facilities to be included in the Act." This exception really is to a legal conclusion regarding how the hearing officer interpreted the law that passed. The exception does not refute the fact that the statutory language clearly distinguishes both "offsite pipelines" and "onsite integral piping and dispensing system[s]" from "stationary tank[s]." If the law considered a pipe onsite or offsite as a petroleum storage system by itself, there would be no reason to make the distinction. Furthermore, Florida Administrative Cede Chapter 17-61, which provides rules regulating pollutant storage facilities, has the following definition at Rule 17-61.02(13):
"Integral piping system" means continuous on-site wetted pipes within the facility used in the transfer or transmission of pollutant to or from a storage tank.
The Legislature was well aware of Chapter 17-61 when it enacted the Super Act, as shown, for example, by the inclusion of certain violations of Chapter 17-61 as a basis for denial of eligibility for the EDI program or the reimbursement program. Sections 376.3071(a)(b)3. & (12)(b)1., Florida Statutes. It is clear from reviewing the relevant law that the Legislature did not intend to address pipelines in general under the Super Act, only those piping systems associated with and an integral part of stationary storage tanks. Everglades' analysis would have the effect of shifting the analysis completely around, by authorizing coverage for tanks that are integral parts of piping systems such as 35 mile long pipelines. The definition or petroleum system could then be read to include a pipeline "together with any onsite integral stationary tank system associated therewith" - a reversal of the true definition. I cannot concur with this legislative analysis, and therefore I reject this exception.
Exceptions to Conclusions of Law
Exception No. 1. Everglades objects to the hearing officer's purported failure to conclude as a matter of law the legislative desire to effect remedial measures and to provide adequate financial resources for cleanup. This issue is addressed extensively in Puckett, supra, where I discussed the need to give the Super Act an expansive interpretation, tempered with the recognition that the Super Act cannot do all things for all persons, but must exist within its statutory boundaries. The brief analysis by the hearing officer on page 10 of the Recommended Order is consistent with Puckett. The exception is therefore rejected.
Exception No. 2. Everglades next asserts that the hearing Officer erred by requiring, contrary to statute, that Everglades have a storage facility; and that "[t]he plain reading of the statute indicates that the legislature did not intend to narrow the definition of petroleum system to include only those facilities whose only or principal purpose is storage." Since the hearing officer found as fact, based upon competent substantial evidence, at paragraph
13 of the Recommended Order, that "the proof establishes that [Everglades'] system is a unified mechanism for the transportation of petroleum product, not storage," the critical question in this case becomes whether Everglades should nonetheless be eligible for reimbursement because the law also covers transportation systems. As in Puckett, supra, we have a battle over
definitions. While the cases cited here vary, the basic conflict remains, between the established concepts that great deference should be given an agency's interpretation of its statute, and that no such interpretation is permissible if the statute is plain or unambiguous in meaning. Compare, e.g., Department of Insurance v. Southern Volusia Hospital District, 438 So.2d 815 (Fla. 1983), with Van Pelt v. Hilliard, 78 So. 693 (Fla. 1918). Everglades' expansive definition of "petroleum storage system" does not have the plain meaning claimed. As discussed previously in response to the seventh factual exception, the statutory emphasis is upon "stationary tanks." Piping is included if it is "onsite," "integral" to the tank, and "associated therewith." These words clearly are designed to limit the type of piping to that normally associated with a service station tank system, tank farm, or similar type of facility. In, this case the evidence showed that the amount of product temporarily held in the tanks to facilitate the operation of the pipeline (approximately 50 barrels maximum) was minute in comparison to the amount of product needed to meet the transport capability of the pipeline (up to 3000 barrels per hour). (Recommended Order at p. 12) To attempt to fit this set of facts into the storage definition would, in essence, require the definition of "stationary tanks" to itself include a pipeline, and the definition of "piping or dispensing systems" to include stationary tanks. This could hardly be considered the plain meaning of the statute.
Everglades suggests that pipelines should be included because of the words "excluding offsite pipelines" contained in Section 376.301(11)(c) of the petroleum storage system definition. This would presumably mean that all "onsite" pipelines would be covered. The quoted words must be read in the context of the whole definition, however. By use of the conjunction "and" prior to that and other qualifications to the central definition with its "onsite integral piping ... associated therewith" wording, it is clear that the "offsite pipelines" language is a further limitation on the definition, not an expansion, since all pipelines are presumably "onsite" in that they are located where they are, such a broad interpretation of the statute would render the balance of the carefully drafted definition meaningless excess verbiage. For these reasons this exception is rejected.
Exception No. 3. Everglades next argues that the Department's interpretation of petroleum storage system is not based upon "demonstrated agency expertise," and thus is not entitled the great weight normally given to an agency's interpretation off statute. Everglades also alleges that to the extent the agency relies on policy, it has not been adequately explicated on the record. In response, it should first be noted that the hearing officer found the Department's interpretation to be consistent with "[a] plain reading of the statutory definition ..." (Recommended Order at p. 12) This being the case, presumably the Department would not have to demonstrate expertise or explain its policy. Nonetheless, such demonstration and explanation have occurred in this case. Mr. Svec testified for the Department as an expert witness with extensive experience in the storage tank field, and explained how the tanks could be treated as part of a transportation as opposed to storage system. (T. 111-117) As an employee of the Department, professional engineer and administrator in the Department's stationary tanks regulation section, (T-106) he was in an appropriate position to explain how the Department interprets the petroleum storage tanks definition. For all of the above reasons, therefore, this exception is rejected.
Exception No. 4. This exception, is essentially a reiteration of the fourth factual exception, in that it asserts that the Department has acknowledged that to store includes "to temporarily hold product." Once again,
Everglades is taking the statement of Mr. Svec out of context. Obviously, storage is a question of time, and that question can be addressed in relative terms. In the most expansive interpretation, storage could include an infinitesimally short delay of the transportation of product; in the most narrow, a very lengthy holding. I do not believe the legislature intended either concept to apply. Rather, one must, once again, look at the concept in the context of the statute - that of a "stationary tank ... used ..., or intended to be used, for storage ..." As noted by the hearing officer, the legislature intended to differentiate transportation from storage, as indicated by the separate enumeration of those terms in Sections 376.30(2)(a) and (3)(a). The regulatory program established pursuant to both the Super Act and the Water Quality Assurance Act, Chapter 83-310, Laws of Florida, were merged in Part II of Chapter 376, and clearly contemplate regulation of storage tanks, with piping covered only to the extent that it is incidental to the operation of the tanks. This exception is therefore rejected.
Exception NO. 5. Everglades next objects to the hearing officer's statement that the term "supply" includes the buying and selling of petroleum products. I concur that such a definition is unduly narrow, though I do not find the hearing officer's supposed inclusion of this requirement to be dispositive either to his own decision or to my analysis of that decision. The hearing officer properly distinguished a supply from a transportation system, but then added a further observation, at page 12, that "supply" in a business sense means buying and selling. I do not wish such an observation to indicate that the Department intends to exclude contamination from a stationary tank from coverage under the reimbursement program simply because the owner was not selling the product but holding it for personal use; or, as could have been permissible in a Puckett type situation, the owner was storing a used petroleum product that would be provided without charge to someone else to recycle as a liquid fuel commodity. Department experience with this program in individual cases will result in further elucidation on the extent of eligibility. In this regard, when read in the context of the petroleum storage system definition, a reasonable interpretation of the words "storage or supply" is that the storage system can be used either for storage alone or for normal liquid fuel commodity uses - i.e., the product does not simply have to sit there to be included within the scope of the definition. This does not mean, however, that supply equates to transportation. Therefore, while I clarify the hearing officer's statement on this issue, I reject the exception.
Exception No. 6. The final exception is to the hearing officer's allegedly incorrect statement that "Everglades offered the argument that the offsite pipeline constituted 'integral piping.'" The statement could easily be read as the hearing officer's logical conclusion to Everglades' position rather than his statement of it. Whether or not the hearing officer intended the statement as such is irrelevant to the main issue, however, which is whether the subject tanks constitute petroleum storage system. On that basis this exception is rejected.
CONCLUSION
While there were numerous exceptions to both findings of fact and conclusions of law, the import of this case can be summarized as follows. The hearing officer found that the tanks in this case served a transportation function and not a storage one. This factual finding was based upon competent substantial evidence and therefore will not be disturbed by me. Eligibility for Super Act reimbursement is only available for spills of petroleum or petroleum product from petroleum storage systems. In this case, while the spill was of
petroleum product, it did not occur from a petroleum storage system, because the definition in Section 376.301(11), Florida Statutes, cannot be extended to include tanks that exist only to service the transportation function of a pipeline. Therefore, Everglades is not eligible for reimbursement pursuant to Section 376.3071(12), Florida Statutes, for its cleanup expenses.
Therefore, it is ORDERED:
The hearing officer's recommended findings of fact are accepted in their entirety.
The hearing officer's conclusions of law are accepted except to the extent clarified by this Final Order.
The applications of Everglades Pipeline Company for eligibility pursuant to Section 376.3071(12), Florida Statutes, is DENIED.
Any party to this Order has the right to seek judicial review of the Order pursuant to section 120.68, Florida Statutes, by the filing of a Notice of Appeal pursuant to Rule 9.110, Florida Rules of Appellate Procedure, with the clerk of the Department in the Office of General Counsel, 2600 Blair Stone Road, Tallahassee, Florida 32399-2400; and by filing a copy of the Notice of Appeal accompanied by the applicable filing fees with the appropriate District Court of Appeal. The Notice of Appeal must be filed within 30 days from the date this Order is filed with the clerk of the Department.
DONE AND ORDERED this 13th day of September, 1988, in Tallahassee, Florida.
STATE OF FLORIDA DEPARTMENT OF ENVIRONMENTAL REGULATION
DALE TWACHTMANN
Secretary
Twin Towers Office Building 2600 Blair Stone Road Tallahassee, Florida 32399-2400
Telephone: (904) 488-4805
FILING AND ACKNOWLEDGMENT
FILED, on this date, pursuant to S. 120.52 Florida States, with the designated Department clerk, receipt of which is hereby acknowledged.
9-14-88
Clerk Date
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that a true copy of the foregoing Final Order has been furnished by U.S. Mail to RICHARD A. PETTIGREW & LUIS R. FIGUEREDO, 5300
Southeast Financial Center, 200 South Biscayne Boulevard, Miami, Florida 33131- 2339 and by hand delivery to DON W. DAVIS, Hearing Officer, Division of Administrative Hearings, 2009 Apalachee parkway, Oakland Building, Tallahassee, Florida 32399-1550; and E. GARY EARLY, Assistant General Counsel, 2600 Blair Stone Road, Tallahassee, Florida 32399-2400, on this 15th day of September, 1988.
STATE OF FLORIDA DEPARTMENT OF ENVIRONMENTAL REGULATION
DANIEL H. THOMPSON
General Counsel
Twin Towers Office Building 2600 Blair Stone Road Tallahassee, Florida 32399-2400
Telephone: (904) 488-9730
| Issue Date | Proceedings |
|---|---|
| Jun. 17, 1988 | Recommended Order (hearing held , 2013). CASE CLOSED. |
| Issue Date | Document | Summary |
|---|---|---|
| Sep. 13, 1988 | Agency Final Order | |
| Jun. 17, 1988 | Recommended Order | Petitioner's request for petroleum spill cleanup assistance denied since leaking tanks were transportation sump tanks which are statutorily excluded. |
