STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

RED TOP SEDAN, INC., )

)

Petitioner, )

vs. ) CASE NO. 88-1168

) STATE OF FLORIDA, DEPARTMENT OF ) ENVIRONMENTAL REGULATION, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was held in this case on February 15, 1989, in Miami, Florida, before Michael M. Parrish, a duly designated Hearing Officer of the Division of Administrative Hearings.

APPEARANCES

For Petitioner: Andrew H. Moriber, Esquire

Murray H. Dubbin, Esquire DUBBIN, BERKMAN, GARBER,

BLOOM & MORIBER

650 Rivergate Plaza

444 Brickell Avenue Miami, Florida 33131

For Respondent: D. Gary Early, Esquire

Department of Environmental Regulation

Twin Towers Office Building 2600 Blair Stone Road Tallahassee, Florida 32399-2400

STATEMENT OF THE ISSUES

The issue in this case is whether the Petitioner is eligible for reimbursement for allowable costs pursuant to Section 376.3071(12), Florida Statutes, related to the cleanup of certain contamination at the Petitioner's ground transportation facility.

PRELIMINARY STATEMENT

At the formal hearing, both parties presented the testimony of witnesses and offered exhibits which were received in evidence. Subsequent to the hearing, a transcript of the proceedings was filed with the Hearing Officer on March 22, 1989. Thereafter, both parties filed proposed recommended orders containing proposed findings of fact and conclusions of law. The parties' proposals have been carefully considered. All proposed findings of fact are specifically addressed in the appendix to this recommended order.

FINDINGS OF FACT

Based on the evidence received at the hearing, I make the following findings of fact:

Facts stipulated to by the parties

1. The subject facility is a bus, limousine and van storage, dispatch, and service area for a ground transportation company serving Miami International Airport which contains a parking lot, fuel storage tanks, an administration building, and a maintenance shop.

   
   

2. The Department of Environmental Regulation is the agency charged with responsibility for administering the provisions of Section 376.3071, Florida Statutes.

   
   

3. Red Top Sedan, Inc., through its agents, notified the Department of possible ground and ground water contamination on or about September 10, 1986. The Department received said notification and on September 19, 1986, advised Red Top that the notice was adequate and requested further information.

   
   

4. Following various correspondence and requests for information, the Department determined that it had sufficient information and, on February 1, 1988, issued its Notice of Intent regarding the eligibility of the subject sites for participation in the program. One area, adjacent to and surrounding the diesel fuel pumps, was found to be eligible. Another area, east and west of the maintenance shop (Exhibit "2" to the Notice) was found to be ineligible. Red Top filed a Petition for Administrative Determination which was received by the Department on February 23, 1988. The Petition was subsequently referred to the Division of Administrative Hearings and a Hearing Officer assigned.

   
   

   Facts Established at Hearing General Information About The Facility

5. The subject facility also contains a parking area for approximately 95 buses, 40 to 45 vans, two dozen mini-buses, and 15 or 16 limousines and Lincoln towncars. There is also employee parking on the site.

   
   

6. To the east of the Red Top office building there is a fuel island used for fueling Red Top's vehicles. The tanks associated with that fuel island have discharged diesel fuel. That petroleum contamination site is entirely separate from the one involved in this proceeding and has been found to be eligible for reimbursement.

   
   

7. When the subject facility was constructed, Red Top employed an engineering company. It also employed a company named Service Station Aid. Service Station Aid is in the business of servicing tanks and other equipment used in connection with the handling of oil, gasoline, diesel fuel, and other similar products. Among other things, Service Station Aid installed underground waste oil tanks and tanks to hold automatic transmission fluid and new motor oil in the area of the maintenance facility. A drainage system servicing the asphalt parking areas and driveways surrounding the various buildings was also

   installed on the subject site. That system contained various grease traps which conformed to accepted practice at the time of their construction.

   
   

   Facts Regarding The East Side of the Maintenance Building

   
   

8. Two underground waste oil tanks are on the east side of the maintenance building. The two waste oil tanks have been in operation since 1976, when the facility was built. Each of these two tanks has a capacity of 560 gallons.

   
   

9. Employees of Red Top regularly pour used motor oil into the two waste oil tanks on the east side of the maintenance facility. The used oil is periodically removed by an EPA approved company. That company removes the waste oil to a fuel recycling facility in the Port Everglades area where it is made into recycled fuel. It is possible, even probable, that used oil has been spilled from time to time both while being poured into the waste oil tanks and while being removed from the waste oil tanks. However, there is no persuasive competent substantial evidence that any such spillage was a significant contribution to the contamination at the site. .1/

   
   

10. It is possible that one or both of the waste oil tanks has leaked. However, there is no persuasive competent substantial evidence that any such leakage was a significant contribution to the contamination at the site. In this regard it is noted that Red Top has not tested either of the waste oil tanks to determine whether they are leaking.

    
    

11. Approximately 70 feet to the east of the maintenance building there are three storm drains. The storm drains are attached by way of a catch basin to soakage pits. Soakage pits are specifically designed to allow materials entering the soakage pit to be discharged directly to the earth. Storm drains are designed to catch stormwater runoff rather than large amounts of pollutants.

    
    

12. The area to the east of the maintenance facility is paved with asphalt. That paved area is sloped so that any discharge of pollutants in that area of the site will flow to the storm drains.

    
    

13. On numerous occasions waste oil has been observed in the storm drains. Instances of direct discharges of waste oil onto the ground or into the storm drains have been observed. Oil stains around the storm drains and observations by Dade County inspectors indicate that such direct discharges have been regular, if not frequent.

    
    

14. Other sources of contamination at the Red Top facility include leaking drums of oil, oil leaking from stored or discarded equipment, oil discharged to the ground, disposal of contaminated waters from the maintenance building, and engine washing water discharged on the site.

    
    

15. In the ground to the east of the maintenance building there is a large plume of dissolved oil and grease. This plume includes a plume of free product in the vicinity of the southernmost of the two waste oil tanks. Extending beyond the identified plume there are additional areas contaminated by constituents of waste oil. The primary cause of the contamination on the east side of the maintenance building is the direct discharge of contaminants.

    Discharge from the two waste oil tanks constitutes, at most, only a very minor cause of the overall contamination. .2/

    
    

    Facts Regarding the West Side of the Maintenance Building

    
    

16. On the west side of the maintenance building there are two underground tanks that are used to hold new motor oil and new transmission fluid. Motor oil and transmission fluid are lubricants used to lubricate engines and transmissions. They are not fuels.

    
    

17. Pollutants which were discharged onto the floor of the maintenance building during maintenance work have been washed directly into the storm drains on the northwest side of the maintenance facility.

    
    

18. There are two small areas of contamination on the west side of the maintenance facility. One such area is around a storm drain at the northwest side of the maintenance facility. The other is around the two tanks that contain new motor oil and transmission fluid.

    
    

19. The contamination in the area of the storm drain includes lead, cadmium, and chromium. Motor oil and transmission fluid do not contain lead, nor do they contain levels of cadmium or chromium in amounts sufficient to be detected in groundwater. There is also an area of free product near the storm drain. There is no storage tank adjacent to the storm drain on the northwest side of the maintenance facility that could account for the lead, cadmium, and chromium contamination or that could account for the area of free product. The contamination at the storm drain on the west side of the maintenance facility resulted from direct discharges of contaminants to the storm drain and catch basin and was not a result of a discharge from a storage tank.

    
    

20. The contamination in the area of the two tanks used for new motor oil and transmission fluid also contains lead, cadmium, and chromium. The metals contamination at this area is a result of discharge to the storm drain, and is not the result of discharge of new motor oil or transmission fluid from the two tanks. The groundwater in the area around these two tanks is also contaminated by dissolved oil and grease. The dissolved oil and grease plume is consistent in terms of substance and concentration with the dissolved waste oil to the east of the building. Within that plume of dissolved oil and grease there is also a small plume of free product.

    
    

21. There is no waste oil tank on the west side of the maintenance facility that could account for waste oil contamination at that location. The dissolved oil and grease plume on the west side of the maintenance facility is most likely the result of waste oil discharge to the catch basin. The tanks containing new motor oil and transmission fluid may have contributed to the small free product plume in that area as a result of overfilling, but any such contribution was only a minor part of the overall contamination.

    
    

22. In reviewing an application for eligibility for reimbursement, the Department looks at the relative importance of eligible and ineligible portions of a contaminated site. In cases where a potentially eligible source is minor in comparison to an overall otherwise ineligible contamination site, the Department's policy is to treat the entire site as ineligible. This policy is based on the fact that as a practical matter it is not possible to clean up one part of a contaminated site without affecting any adjacent contaminated areas. For the same reason, if the majority of a contaminated site is eligible, but it

    contains minor ineligible sources, the Department's policy is to treat the entire site as eligible.

    
    

    CONCLUSIONS OF LAW

    
    

    Based on the foregoing findings of fact and on the applicable legal principles, I make the following conclusions of law:

    
    

23. The Division of Administrative Hearings has jurisdiction over the subject matter and the parties to this proceeding. Section 120.57, Florida Statutes.

    
    

24. The Petitioner in this case has the burden of demonstrating its entitlement to participate in the reimbursement program established by Section 376.3071(12), Florida Statutes. Irvine v. Duval County Planning Commission, 466 So.2d 357 (Fla. 1st DCA 1985), quashed at 495 So.2d 167 (Fla. 1986), on remand at 504 So.2d 1265 (Fla. 1st DCA 1986); University Medical Center, Inc. v. Department of Health and Rehabilitative Services, 483 So. 2d 712 (Fla. 1st DCA 1985); Florida Department of Transportation v. J.W.C. Company, Inc., 396 So.2d 778 (Fla. 1st DCA 1981).

    
    

25. The Inland Protection Trust Fund, from which the Petitioner seeks reimbursement is created by Section 376.3071, Florida Statutes. Subsection (2) of that statutory provision contains the following statement of intent and purpose:

    
    

    It is the intent of the Legislature to establish the Inland Protection Trust Fund to serve as a repository for funds which will enable the department to respond without delay to incidents of inland contamination related to the storage of petroleum and petroleum products in order to protect the public health, safety, and welfare and to minimize environmental damage. (emphasis added)

    
    

26. Section 376.301, Florida Statutes, contains the following pertinent definitions:

    
    

    1. "Petroleum" includes:

       1. Oil, including crude petroleum oil and other hydrocarbons, regardless of gravity, which are produced at the well in liquid form by ordinary methods and which are not the result of condensation of gas after it leaves the reservoir; and

       2. All natural gas, including casinghead gas, and all other hyrocarbons not defined as oil in paragraph (a).

    2. "Petroleum product" means any liquid fuel commodity made from petroleum, including, but not limited to, all forms of fuel known or sold as diesel fuel, kerosene, all forms of fuel known or sold as gasoline, and fuels containing a mixture of gasoline and other products, excluding liquefied

       petroleum gas and American Society for Testing and Materials (ASTM) grades no. 5 and no. 6 residual oils, bunker C residual oils, intermediate fuel oils (IFO) used for marine bunkering with a viscosity of 30 and higher, asphalt oils and petrochemical feedstock.

    3. "Petroleum storage system" means a stationary tank not covered under the provisions of chapter 377, together with any onsite 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 . . ..

       
       

27. In its final order in Puckett Oil Company v. Department of Environmental Regulation, 10 FALR 5525 (Sept. 1, 1988), the Department discussed, applied, and interpreted the above-quoted statutory provisions. The Department's order in Puckett includes the following:

    
    

    My conclusion is Summarized as follows: "Petroleum" as defined in the Super Act is limited to oil from the well, and does not include hydrocarbons that have been refined or otherwise made out of petroleum. The term does not include used oil. "Petroleum product," however, can include used oil, but only if it is being utilized, to a significant degree, either by the owner or the ultimate user, as a liquid fuel commodity. Eligibility for reimbursement under the Super Act can cover spills from used oil, but only if used oil meets the functional definition of petroleum product and only if the contamination results from spills related to its storage in petroleum storage systems.

    * * *

    In this regard, I find that if a product made from petroleum is commonly used as a fuel, then the petroleum product definition should apply notwithstanding the fact that a site owner may also sell or use the product for other reasons.

    * * *

    This analysis leads me to the conclusion that used oil may be included as a "petroleum product," but not necessarily under all circumstances. Just as used oil should be included when it is being reused, public policy dictates that it should not be included when it simply is being discarded. There is clear support in Chapter 376 for this analysis. The "liquid fuel commodity" language in the definition connotes a reuse component. The above-cited "Intent and

    Purpose" language supports this analysis by limiting coverage of the Inland Protection Trust Fund to incidents related to storage. Similarly, Section 376.3071(4) talks about using the fund for "incidents of inland contamination related to the storage of petroleum or petroleum products "

    Subsection (9), describing the EDI program, also addresses "contamination from leaking petroleum storage systems." Subsection (12), the reimbursement program, uses the more general term "contamination sites." When the statute is read as a whole, however, it is clear that this undefined term should be read with the "intent and purpose" and "uses" language to mean sites contaminated from incidents related to

    storage of petroleum and petroleum products. A more expansive definition could open up reimbursement coverage to any conceivable spill from any source, whether or not it could be determined that the spill was of a "liquid fuel commodity." Given my acceptance of an interpretation of the definition of "petroleum product" which includes used oil, it is critical that site cleanup coverage be limited to used oil being stored for recycling as opposed to simply being discarded.

    
    

28. Applying the foregoing definitions and interpretations to the facts in this case, it must first be concluded that the waste oil in the tanks on the east side of the maintenance facility constitutes "petroleum product" because it is being stored for recycling. It must also be concluded that the contents of the tanks on the west side of the maintenance facility do not constitute "petroleum" or "petroleum product" because new motor oil and new transmission fluid are not "oil from the well," and they are not being used as fuel.

    
    

29. As noted in the findings of fact, the vast majority of the contamination in the vicinity of the maintenance facility appears to be the result of direct discharges of waste oil from sources other than petroleum storage systems. Therefore, the vast majority of the contamination in that vicinity is ineligible for reimbursement under Section 376.3071(12), Florida Statutes.

    
    

30. To the extent that leaks or spills from the tanks containing new motor oil and new transmission fluid may have contributed to the subject contamination, such spills or leaks would be ineligible because these substances are lubricants rather than "liquid fuel commodities" and, therefore, do not meet the definition of "petroleum product."

    
    

31. To the extent that leaks or spills from the tanks containing waste oil may have contributed to the subject contamination, such leaks or spills, in the absence of any other source of contamination, would be eligible for reimbursement under Section 376.3071(12), Florida Statutes. However, in this case any leaks or spills from the waste oil tanks comprise only a minor portion of the contamination, which was caused for the most part by ineligible sources.

Where, as here, contamination was caused by both eligible and ineligible sources, the Department has interpreted the statute as treating the entire contamination site as ineligible if the majority of the contamination was caused by ineligible sources. This appears to be a permissible and reasonable interpretation of the statute and, as such, is entitled to great weight. See, generally, Department of Insurance v. Southeast Volusia Hospital District, 438 So.2d 815, 820 (Fla. 1983); Pan American World Airways v. Florida Public Service Commission, 427 So.2d 716 (Fla. 1983); Department of Administration v.

Nelson, 424 So.2d 852 (Fla. 1st DCA 1982). Application of that interpretation to the facts in this case leads to the conclusion that the contamination in the area of the Petitioner's maintenance facility is not eligible for reimbursement under Section 376.3071(12), Florida Statutes.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Environmental Regulation issue a final

order in this case concluding that the contamination area at issue in this

proceeding is not eligible for reimbursement under Section 376.3071(12), Florida Statutes.

DONE AND ENTERED in Tallahassee, Leon County, Florida, this 15th day of June 1989.

MICHAEL M. PARRISH

Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 15th day of June 1989.

ENDNOTES

1/ The testimony to the effort that such spillage was a major contributing cause is contrary to the greater weight of the

evidence.

2/ The proof on this issue offered by both parties was rather weak. The most that can be said on the basis of the total record in this case is that the greater weight of the evidence is to the effect that the causation findings made in this paragraph are more likely than any other version that has been proposed.

APPENDIX TO THE RECOMMENDED ORDER IN CASE NO. 88-1168

The following are my specific rulings on all proposed findings of fact submitted by all of the parties.

To facilitate an understanding of the rulings which follow, it is noted that, while there is general agreement about a number of the facts in this case, there are also a number of significant disagreements and conflicts in the testimony regarding other facts. On some points there is conflict in the testimony of lay witnesses. There are also conflicts in the opinions expressed by the experts. For the most part the conflicts have been resolved in favor of the versions advocated by the Department of Environmental Regulation because, for the most part, that version appears to be the most consistent with other evidence and also appears to be the most logical. The specific rulings follow.

Findings proposed by Petitioner:

The paragraphs of the Petitioner's proposed recommended order are not numbered. The references below are to the unnumbered paragraphs following the caption FACTS on page 2 of the Petitioner's proposed recommended order and continuing through the middle of page 8. Page numbers have been added for convenience of reference.

(Page 2) All of the proposed findings on this page are accepted in substance.

(Page 3) Top four lines accepted in substance. Sentence beginning on line

5 and continuing through line 7 is rejected as argument rather than proposed findings of fact.

(Page 3) First full paragraph on this page [lines 8 through 11]: Accepted in substance.

(Page 3) Last paragraph on this page [lines 13 through 26]: Lines 13 through 22 are rejected as constituting argument or commentary on parties' positions rather than proposed findings of fact. Last four lines accepted in substance.

(Page 4) First four lines are accepted in substance.

(Page 4) Lines 5 through 17: Most of the proposals on these lines are rejected as conclusions that are contrary to the greater weight of the evidence, although some of the details are accepted.

(Page 4) Last paragraph on this page [lines 18 through 26]: Rejected as constituting argument and commentary about the Department's position rather than proposed findings of fact.

(Page 5) All of the material on this page is rejected as constituting argument rather than proposed findings of fact.

(Page 6) Lines 2 through 5: Accepted in substance.

(Page 6) First full paragraph on this page [lines 6 through 20]: Rejected as for the most part constituting argument rather than proposed findings of fact. Portions are also rejected as constituting conclusions not warranted by the evidence.

(Page 6) Last paragraph on this page: Rejected as constituting legal argument rather than proposed findings of fact.

(Page 7) Top paragraph: Rejected as constituting argument and conclusions not warranted by the evidence rather than proposed findings of fact.

(Page 7) Middle paragraph: First two sentences rejected as contrary to the greater weight of the evidence. Last sentence rejected as irrelevant in light of the other facts in this case.

(Page 7) Last paragraph: Rejected as constituting legal argument rather than proposed findings of fact.

(Page 8) Top fifteen lines: Rejected as constituting legal argument rather than proposed findings of fact.

Findings proposed by Respondent:

Paragraphs 1, 2, and 3: Rejected as constituting summaries of statutory provisions rather than proposed findings of fact.

Paragraphs 4 through 20: Accepted in substance.

Paragraph 21: Rejected as subordinate and unnecessary details and as not fully consistent with the greater weight of the evidence.

Paragraphs 22 through 25: Rejected as subordinate and unnecessary details.

Paragraph 26: First sentence rejected as subordinate and unnecessary details. Second sentence rejected as a summary of testimony rather than a proposed finding of fact.

Paragraphs 27 through 29: Accepted in substance.

Paragraphs 30 and 31: Rejected as subordinate and unnecessary details.

Paragraphs 32 through 40: Accepted in substance with some unnecessary details and some repetitious details omitted.

Paragraphs 41 and 42: Rejected as a summary of testimony and as subordinate and unnecessary details.

Paragraph 43: Rejected as useless speculation; no one knows what the "blue water" consisted of.

Paragraphs 44 through 49: Rejected for the most part as repetitious. Paragraph 50. Accepted in substance.

Paragraph 51 through 53: Rejected as subordinate and unnecessary background details.

Paragraphs 54 through 57: Accepted in substance.

Paragraphs 58 through 60: Rejected as subordinate and unnecessary background details.

Paragraphs 61 and 62. Rejected as repetitious.

Paragraphs 63 through 77: Rejected as constituting subordinate details and argument regarding the significance of

certain testimony.

Paragraphs 78 through 94: Accepted in substance.

Paragraph 95: Rejected as not supported by persuasive competent substantial evidence.

Paragraph 96: Rejected as constituting argument rather than proposed findings of fact.

Paragraphs 97 through 101: Accepted in substance.

Paragraphs 102 and 103: Rejected as constituting argument rather than proposed findings of fact.

Paragraph 104: Rejected as repetitious.

Paragraphs 105 through 107: Rejected as irrelevant.

Paragraph 108: First two sentences rejected as constituting argument rather than proposed findings of fact. Last sentence accepted in substance.

Paragraphs 109 and 110: Accepted in substance.

Paragraphs 111 through 114: Rejected as argument of legal conclusions rather than proposed findings of fact.

COPIES FURNISHED:

Andrew H. Moriber, Esquire Murray H. Dubbin, Esquire DUBBIN, BERKMAN, GARBER

BLOOM & MORIBER

650 Rivergate Plaza

444 Brickell Avenue Miami, FL 33131

E. Gary Early, Esquire

Department of Environmental Regulation Twin Towers Office Building

2600 Blair Stone Road Tallahassee, FL 32399-2400

Daniel H. Thompson, Esquire General Counsel

Department of Environmental Regulation Twin Towers Office Building

2600 Blair Stone Road Tallahassee, FL 32399-2400

Dale H. Twachtmann, Secretary Department of Environmental Regulation Twin Towers Office Building

2600 Blair Stone Road Tallahassee, FL 32399-2400

Docket for Case No: 88-001168

Orders for Case No: 88-001168