The Issue Whether Petitioner's site is eligible for state- administered cleanup under Respondent's Early Detection Incentive Program.
Findings Of Fact Nana's Petroleum, Inc., owns and operates a service station at 251 East Main Street, Pahokee, Florida. The facility is located within two or three blocks of Lake Okeechobee, which is a Class I drinking water supply. On October 19, 1988, Petitioner applied pursuant to the Early Detection Incentive Program for state assistance due to a suspected discharge of gasoline at the facility. The application indicated that a monitoring well had approximately one-quarter inch of product in it, but that the source of that contamination, though suspected to be from a leak in a line, was unknown. As of the date of the final hearing in this cause, Petitioner still had not performed an investigation to determine the source of the contamination. Failure to investigate the source of a discharge results in the possibility of the discharge continuing. A continual discharge results in the loss of more product from the system, increases the threat to drinking water supplies, and creates other environmental concerns. A discharge of fuel has the ability to harm people or property due to the resulting contamination of groundwater. Once the contamination has reached the groundwater, it can migrate to adjacent surface waters or potable water wells. The failure to stop a discharge, therefore, results in a greater threat to groundwater and to drinking water due to the greater amounts of product in the groundwater. Inventory is taken by inserting a calibrated pole into the storage tank and measuring the level of product in the tank. Due to the angle of the pole, fluctuations in volume due to heating and cooling of the product, and other factors, accuracy is only possible to 1/8 of an inch. One-eighth of an inch equates to 17 gallons in a 10,000-gallon tank. Inventory is accurate only for determining whether large or medium leaks are occurring and is not accurate for the detection of small leaks. Reviewing inventory records is not an acceptable method of investigating the source of a discharge. Only in the last few months has Petitioner been making monthly monitoring system checks.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is, therefore, RECOMMENDED that a Final Order be entered denying Petitioner's Early Detection Incentive Notification Application. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 26th day of February, 1990. LINDA M. RIGOT 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 26th day of February, 1990. APPENDIX TO RECOMMENDED ORDER DOAH CASE NO. 89-5912 Respondent's proposed findings of fact numbered 1-3 and 9 have been rejected as not constituting findings of fact but rather as constituting conclusions of law. Respondent's proposed findings of fact numbered 4-8, 10-17, 20, and 21 have been adopted either verbatim or in substance in this Recommended Order. Respondent's proposed findings of fact numbered 18 and 19 have been rejected as unnecessary for determination. COPIES FURNISHED: John W. Thornton 315 Southeast 8th Avenue Okeechobee, Florida 33472 E. Gary Early, Esquire Department of Environmental Regulation Twin Towers Office Building 2600 Blair Stone Road Tallahassee, Florida 32399 Dale H. Twachtmann, Secretary Department of Environmental Regulation Twin Towers Office Building 2600 Blair Stone Road Tallahassee, Florida 32399 Daniel H. Thompson, General Counsel Department of Environmental Regulation Twin Towers Office Building 2600 Blair Stone Road Tallahassee, Florida 32399
Findings Of Fact On March 22, 1977 during a routine inspection of various service stations in Vero Beach, a sample of No. 2 diesel fuel was taken from the pump at English Brothers Truck Stop. Upon analysis at the mobile laboratory the sample was found to be below the minimum flash point for No. 2 diesel fuel and the inspector returned to the station the same day and issued a stop sale notice. (Exhibit 3). Three additional samples were taken, and when analyzed they too were found to be below minimum flash point for this type fuel. Upon receipt of the stop sale notice the station manager notified Respondent. After the fuel had been analyzed at the state laboratory Respondent was notified that since the retail value of the contaminated fuel exceeded $1,000 it could pay $1,000 in lieu of having the fuel confiscated. Respondent owns the fuel at English Brothers Truck Stop until such time as the fuel is removed through the pump for sale. Upon receipt of the notice of the contaminated fuel, which was in one 4,000 gallon tank, Respondent immediately sent three employees to remove the contaminated fuel and clean the tank. Thereafter Respondent attempted to locate the source of the contamination but without success. Since the flash point was lower than allowed for diesel fuel the most likely source of contamination was gasoline which is a higher priced fuel than diesel. Standards used by the Petitioner in determining the required characteristics of fuels are those prescribed by the ASTM. Respondent distributes some 750,000 gallons of diesel fuel per month and this is the first report of contamination of its fuel in the eight and one half years Respondent has been in business.
The Issue The issue for consideration in this hearing is whether the Petitioner is entitled to reimbursement for clean up costs associated with the Initial Remedial Action, (IRA), activities of the Abandoned Tank Restoration Program performed at his facility, and if so, in what amount.
Findings Of Fact At all times the Respondent, Department of Environmental Protection, (Department), has been the state agency in Florida responsible for the administration of the state's Abandoned Tanks Restoration Program. Petitioner is the owner and operator of Mohammad's Supermarket, Department facility No. 29-8628197, a food market and gasoline station located at 3320 Hillsborough Avenue in Tampa. Petitioner has owned and operated the facility for approximately the last ten years. The facility in question included three 5,000 gallon gasoline underground storage tanks and one 5,000 diesel underground storage tank. The diesel tank has not been used for the storage of diesel product for the entire time the Petitioner has owned the facility, at least ten years, but the three gasoline tanks were in use after March 1, 1990. Gasoline tanks were reinstalled at the facility and are still in use. In March, 1993, Petitioner removed all four underground storage tanks from the facility and performed initial remedial action. The field and laboratory reports of the soil and groundwater samples taken at the site at the time the tanks were removed showed both gasoline and diesel contamination. In October, 1993, the Petitioner submitted an application for reimbursement of certain costs associated with the IRA program task to the Department. Thereafter, by letter dated August 5, 1994, the Department notified Petitioner that it had completed its review of the reimbursement application and had allowed Petitioner 25% of the total amount eligible for reimbursement. This was because since the Petitioner continued to use the gasoline tanks after March 1, 1990, the Petitioner's ATRP eligibility is limited to clean up of only the diesel contamination. Petitioner's application for reimbursement covered the entire cost of the tank removal, both gasoline and diesel, and did not differentiate between the costs associated with the remediation of the gasoline contamination and those associated with the diesel contamination. The 25% allowance was for the one tank, (diesel fuel), which was eligible for ATRP clean up reimbursement. The Department subtracted from the personnel costs in the amount of $5,996.25, claimed in Section 2A of the claims form, the sum of $45.00 for costs associated with ATRP eligibility status; $497.50 claimed as a cost associated with the preparation of a Tank Closure Report, and $3,508.75 claimed as costs associated with the preparation of a preliminary Contamination Assessment Report, (CAR). These deductions were made because costs associated with ascertaining ATRP eligibility status, the preparation of a Tank Closure report, and the preparation of a preliminary CAR are all costs ineligible for reimbursement. These three ineligible costs total $4,051.25. When this sum is deducted from the amount claimed, the remainder is $1,944.50. The Department then reduced this figure by prorating it at 25% for the diesel tank and 75% for the gasoline tanks, disallowing the gasoline portion. With that, the total reimbursement for Section 2A, personnel, costs is $486.25. Petitioner claimed $1,765.00 for rental costs, (Section 2C), associated with soil removal, from which the Department deducted the sum of $1,550.00 which represents costs associated with the preparation of a preliminary Contamination Assessment Report, (CAR), which is not eligible for reimbursement. The balance of $215.00 was reduced by the 75%, ($161.27), which related to the three gasoline tanks, leaving a balance of $53.75 to be reimbursed for rental costs attributable to the diesel contamination. Petitioner also claimed $12,865.75 for miscellaneous costs associated with soil removal. This is listed under Section 2I of the application. From that figure the Department deducted the sum of $9,455.99 as costs attributable to the three gasoline tanks. In addition, $2,017.43 was disallowed because it related to the preliminary CAR, and $3,151.99 was deducted because the tank was removed after July 1, 1992. The applicable rule requires justification in the Remedial Action Plan, (RAP), for removal of tanks after that date. Such costs, when justified, can be reimbursed as a part of a RAP application. A further sum of $1,759.66 was deducted from the 2I cost reimbursement since the applicant got that much as a discount on what it paid. Together the deductions amounted to $16,385.07, and when that amount is deducted from the amount claimed, a negative balance results. Section 3 of the application deals with soil treatment. Subsection 3I pertains to such miscellaneous items as loading, transport and treatment of soil. The total amount claimed by Petitioner in this category was $13,973.44. Of that amount, $10,480.00 was deducted because it related to the three gasoline tanks. The amount allowed was $3,493.44, which represents 25% of the total claimed. Category 7 on the application form deals with tank removal and replacement. Section 7A relates to personnel costs and Petitioner claimed $4,187.00 for these costs. Of this, $3,140.25 was deducted as relating to the three gasoline tanks and amounted to 75% of the claimed cost. In addition, $1,046.75 was deducted because the diesel tank was removed after July 1, 1992 and there was no justification given for the removal at that time. This cost might be reimbursed through another program, however. In summary, all personnel costs were denied, but so much thereof as relates to the diesel tank may be reimbursed under another program. Section 7C of the application form relates to rental costs for such items as loaders, trucks and saws. The total claimed was $2,176.00. Of this amount, $1,632.00 was deducted as relating to the three gasoline tanks, and an additional $544.00 was deducted as being associated with the non-justified removal of the diesel tank after July 1, 1992. As a result, all costs claimed in this section were denied. In Section 7D, relating to mileage, a total of $12.80 was approved, and for 7G, relating to permits, a total of $28.60 was approved. In each case, the approved amount constituted 25% of the amount claimed with the 75% disallowed relating to the three gasoline tanks. Section 7I deals with miscellaneous expenses relating to tank removal and replacement. The total claimed in this section was $2,262.30. A deduction of $1,697.11 was taken as relating to the three gasoline tanks, and $565.69 was deducted because the removal after July 1, 1992 was not justified in the application. This cost may be reimbursed under a separate program, but in this instant action, the total claim under this section was denied. Petitioner asserts that the Department's allocation of 75` of the claimed costs to the ineligible gasoline tanks is unjustified and inappropriate. It claims the majority of the costs where incurred to remove the eligible diesel fuel contamination and the incidental removal of overlapping gasoline related contamination does not justify denial of the costs to address the diesel contamination. To be sure, diesel contamination was detected throughout the site and beyond the extend of the IRA excavation. The soil removed to make room for the new tanks was contaminated and could not be put back in the ground. It had to be removed. The groundwater analysis shows both gasoline and diesel contamination at the north end of the property furthest from the site. The sample taken at that point, however, contains much more gasoline contaminant than diesel. Petitioner contends that the costs denied by the Department as relating to gasoline contamination were required in order to remove the diesel contamination and Petitioner should be reimbursed beyond 25%. It contends that the diesel contamination could not have been removed without removing all four tanks.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore: RECOMMENDED that a Final Order be entered denying Petitioner request for additional reimbursement of $27,653.82 and affirming the award of $6,629.07. RECOMMENDED this 25th day of September, 1995, in Tallahassee, Florida. ARNOLD H. POLLOCK, 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 25th day of September, 1995. COPIES FURNISHED: W. Douglas Beason, Esquire Department of Environmental Protection 2600 Blair Stone Road Tallahassee, Florida 32399-2400 Francisco J. Amram, P.E. Qualified Representative 9942 Currie Davis Drive, Suite H Tampa, Florida 33619 Virginia B. Wetherell Secretary Department of Environmental Protection Douglas Building 3900 Commonwealth Boulevard Tallahassee, Florida 32399-1000 Kenneth Plante General Counsel Department of Environmental Protection Douglas Building 3900 Commonwealth Boulevard Tallahassee, Florida 32399-1000
Findings Of Fact On September 16, 1981, an inspector employed by the Petitioner, Department of Agriculture and Consumer Services took gasoline samples from leaded and unleaded pumps identified as "Way 44547513" and "Way 445475A" respectively, at the Cigar City Auto/Truck Plaza, in Tampa, Florida. The samples were tested and found to contain suspicious substances. Specifically, the unleaded gasoline was found to be contaminated with leaded gasoline. As a result of test results, the Department issued a stop sale notice to Robert Lawson, Manager of Cigar City, on September 18, 1981. The test analysis showed that the unleaded gasoline sample exceeded the standards established by the American Society of Testing and Materials (ASTM) for unleaded fuel which were adopted by the Department as Rule 5F-2.01, Florida Administrative Code. The sample in question contained 1.41 gram of lead per gallon and, therefore, violated Rule 5F-2.01(1)(j), Florida Administrative Code, which states that unleaded gasoline may not contain more than 0.05 gram of lead per gallon. The Respondent was permitted to post a $1,000 cash bond in lieu of confiscation in order to secure the release of 4,230 gallons of illegal gasoline for sale as leaded regular. The contamination was caused by a delivery man for a gasoline supplier who unintentionally placed-leaded gasoline into an unleaded tank. When the Respondent became aware of the problem, immediate steps were taken which included color coding the tanks so that the problem would not reoccur. This is the first incident concerning the sale of illegal gasoline in which the Respondent has been involved. No complaints were filed by any consumers concerning the gasoline sold by the Respondent.
Recommendation Upon consideration of the foregoing, it is RECOMMENDED: That the Department enter a final order returning $750 of the Respondent's cash bond which was required to be posted. DONE and ORDERED this 8th day of January, 1982, in Tallahassee, Florida. SHARYN L. SMITH, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 8th day of January, 1982. COPIES FURNISHED: Robert A. Chastain, Esquire General Counsel Department of Agriculture and Consumer Services Mayo Building Tallahassee, Florida 32301 Gerald Taylor, Esquire 3224 Bay to Bay Boulevard Tampa, Florida 33609
Findings Of Fact Petitioner, Jerry's Oil, prepared Early Detection Incentive Program Notification Applications for two of its gas stations in Florida on August 13, 1987. One application was for a station located in Okeechobee, Florida, registered as DER Facility No. 478732808. The other application was for a station located in Tarpon Springs, Florida, registered as DER Facility No. 528732810. The application form had two purposes. The first purpose of the form was to notify the Department of Environmental Regulation of petroleum contamination problems. The second purpose was to provide information to the agency that could be used to determine the applicant's eligibility for the Early Detection Incentive (EDI) Program. The EDI Program provides funding and other state assistance with environmental cleanup of petroleum contamination problems to tank owners for a limited period of time. To be eligible for participation in the EDI Program, an applicant had to complete the application form provided by DER and submit it to the agency during the reporting period from July 1, 1986 through December 31, 1988. The application for the Okeechobee gas station reports that a discharge of unleaded gasoline was discovered at the site on July 8, 1987. The dispenser, which is part of the storage system, leaked because of a loose connection. The estimated number of gallons lost was unknown, but the system was repaired before the report was made to DER on August 13, 1987. The application for the Tarpon Springs gas station reports that a discharge of vehicular diesel was discovered at this site on July 12, 1987. There was a loose connection between a pipe and the dispenser. In addition, the pump hose leaked. The amount of gallons lost as a result of these equipment problems was unknown. The gasket on the pump was replaced, and the system was otherwise repaired prior to the report to DER. Petitioner completed these applications to report the discharges and to have the company's eligibility for the EDI program determined by DER. As part of his usual business practice, the owner of Jerry's Oil completed the applications and gave them to Delores M. Quinette. Ms. Quinette then made copies of the front page of each application for Petitioner's files. Ms. Quinette placed the applications together in one envelope addressed to the Department of Environmental Regulation at 2600 Blairstone Road, Tallahassee, Florida. The envelope indicated that this correspondence was directed to the attention of Laurie Ginger. The proper return address was also placed on the stamped envelope. On the same day, the envelope containing the applications was placed in the residential mailbox belonging to Delores M. Quinette at 1110 Pine Lake Drive South, Tampa, Florida 33612. The red flag on the mailbox was raised to alert the mailman that the mailbox contained outgoing mail. This mailing procedure was used by the Petitioner in the ordinary course of business as Ms. Quinette is an independent contractor who handles the paperwork for Petitioner from her home. On August 14, 1987, Ms. Quinette checked the mailbox to remove incoming mail. The envelope addressed to the DER was no longer in the mailbox. It was assumed that the mailman had taken the outgoing mail for delivery to the addresses indicated on the correspondence. The envelope containing the applications was never returned to Ms. Quinette by the U.S. Postal Service. Petitioner relied on this mailing procedure to notify DER of the petroleum discharges and its intention to apply for eligibility into the EDI program. DER's records relating to EDI Program applications do not reflect that these two applications were received within the designated reporting period or within a reasonable time thereafter. DER first become aware that the original applications had been sent in August 1987 during the month of September of 1991. This was over two and a half years after the reporting period had closed. Petitioner discovered that the original applications were never received by DER when inquiry was made by Petitioner's contractor about the company's EDI Program eligibility during site rehabilitation in September 1991. Copies of the front page of each application retained by Petitioner were then mailed to DER, along with an affidavit stating the original applications had been mailed on August 14, 1987. Upon receipt of these copies, DER advised Petitioner it was ineligible to receive EDI Program benefits because these applications were not timely filed. Petitioner takes the position that DER should look to the date the original applications were entrusted to the U.S. Postal Service instead of the date the copies were received by DER as the reporting date for the eligibility determination. Petitioner also contends that it is possible that DER might have lost applications actually received. Neither the receipt of the original applications by DER nor the agency's loss of the applications was proved at hearing.
Recommendation Based upon the foregoing, it is RECOMMENDED: That the applications for eligibility in the EDI Program submitted by Petitioner for DER Facility Nos. 528732810 and 478732808 be denied as they were not timely filed with the Department. That the doctrine of equitable tolling should not be applied to the reporting period deadline on Petitioner's behalf because the responsibility to make sure the applications were received by DER remained with Petitioner throughout the application process. DONE and ENTERED this 1st day of May, 1992, in Tallahassee, Leon County, Florida. VERONICA E. DONNELLY 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 1st day of May, 1992. APPENDIX TO RECOMMENDED ORDER Petitioner's proposed findings of fact are addressed as follows: Accepted. See HO #1 - #12. Accepted. See HO #1 - #12, and #15. Accepted. See HO #14. Accepted. See HO #13, #14, #15 and #16. Accepted. See HO #17. First sentence accepted. Second and third sentences accepted. Fourth sentence rejected. Speculative, assumes facts not in evidence and without proper foundation. Respondent's proposed findings of fact are addressed as follows: Accepted. Accepted. See HO #1. 3. Accepted. See HO #1. 4. Accepted. See HO #2. 5. Accepted. 6. Accepted. See HO #2. 7. Accepted. 8. Accepted. 9. Accepted. See HO #14. 10. Accepted. See HO #15. 11. Accepted. 12. Accepted. 13. Accepted. 14. Accepted. See HO #13. 15. Accepted. See HO #15. 16. Accepted. Rejected. Irrelevant. Hearing Officer relied on testimony at hearing. Also, misrepresentation of testimony and events, contrary to fact. Accepted. See HO #16. Accepted. See HO #16. COPIES FURNISHED: WILLIAM B TAYLOR IV ESQ MacFARLANE FERGUSON ALLISON & KELLY PO BOX 1531 TAMPA FL 3 3601 BRIGETTE A FFOLKES ESQ ASST GENERAL COUNSEL DEPT OF ENVIRONMENTAL REGULATION 2600 BLAIRSTONE RD TALLAHASSEE FL 32399 2400 CAROL BROWNER, SECRETARY DEPT OF ENVIRONMENTAL REGULATION TWIN TOWERS OFFICE BLDG 2600 BLAIRSTONE RD TALLAHASSEE FL 32399 2400 DANIEL H THOMPSON ESQ GENERAL COUNSEL DEPT OF ENVIRONMENTAL REGULATION 2600 BLAIRSTONE ROAD TALLAHASSEE FL 32399 2400
Findings Of Fact Puckett Oil Company, at times pertinent hereto, operated a full-service gasoline and auto service station at 7251 Pensacola Boulevard, Pensacola, Florida. The station at that site performed a complete range of automotive repairs, including lubrication and oil changes. These services are typical of such full-service service stations. On or about June 27, 1986, the operator of that station which was owned by Puckett, Mr. Winters, discovered a discharge of used oil at the site. The discharge occurred because the operator believed that used oil had been drained into an underground storage tank on a routine basis at the facility, as the oil was changed in customer vehicles. In fact, it developed that, unbeknownst to Mr. Winters, the tank had been removed by the prior land owner. This resulted in repetitive contamination of soil and groundwater at the facility, since the oil poured into the floor drain at the station, after being removed from the crank cases of customer vehicles, was in reality draining into the ground, instead of into a storage tank. After becoming aware of this problem, Puckett filed an Early Detection Incentive (EDI) Program Notification Application, reporting the discharge of used oil to the Department, pursuant to Section 376.3071, Florida Statutes (Supp. 1986). That EDI notification application form lists used oil as a "product." Puckett notified the Department of its intent to proceed with voluntary cleanup at the Puckett site pursuant to Section 376.3071(11) and (12), Florida Statutes (Supp. 1986), and to seek reimbursement for the cost of that contamination cleanup pursuant to Section 376.3071(12), Florida Statutes (Supp. 1986). The Department, in view of the request, conducted a site inspection on December 19, 1986. The Department's inspection personnel prepared an EDI Program Compliance Notification Checklist on the Puckett site. This report noted the circumstances of the discharge, to the effect that the used oil tank had been removed while used oil was still being disposed of through the drain at the service station. Thereafter, by its Order of April 16, 1987, the Department advised Puckett that its site was not eligible for "Super Act" reimbursement. The denial of eligibility was based on the DER's position that used oil was not "petroleum" or a "petroleum product" for purposes of Section 376.301(9) or (10), Florida Statutes (Supp. 1986). On May 8, 1987, Puckett filed a Petition for Formal Proceedings, alleging, among other things, that used oil is "petroleum" or "petroleum product" within the meaning of the "Super Act" and that the Department is estopped from denying "Super Act" reimbursement eligibility for voluntarily reported discharges of used oil. Inasmuch as the DER conducted inspections of the site in question, recording its findings, the Department was aware of the circumstances of the discharge; that the used oil tank had been removed and that oil had continued thereafter to be placed in the drain facility, thus contaminating the soil where the used oil disposal tank had formerly been placed. The Department did not raise the eligibility exception involving gross negligence in the Order of April 16, 1987, however, nor by any other vehicle until the filing of its Motion for Continuance with the Hearing Officer on August 31, 1987. Additionally, in response to a Request for Admissions served by Puckett, the Department admitted that the sole basis for denial of the reimbursement eligibility for the Puckett site was the fact that the substance discharged was "used oil," which the Department contends is not petroleum or petroleum product and thus is not a proper subject for reimbursement of related clean up and decontamination expenses. Uncontroverted evidence establishes that in August 1984, eleven oil changes at the Puckett site generated 3.5 quarts or about 9 1/2 gallons of used oil. Using this figure as an average, until the time the discharge was discovered 22 months later, the Puckett site generated approximately 210 gallons of used oil. Mr. Winters testified that he believed he had a 500 or 1,000 gallon used oil tank. Puckett's used oil was disposed of by inserting the drain bucket on the floor drain. The floor drain is a receptacle with an adapter on it for the oil drain bucket. Although the floor drain system appeared to be a working system, the underground used oil storage tank at the Puckett site had been removed, unbeknownst to Mr. Winters. It was apparently removed by Exxon Corporation, the previous site operator. It was Exxon's practice to remove fuel tanks from non-operational stations, such as the Puckett site was at the time it was sold to Puckett. It was not their normal practice, however, to remove used oil storage tanks. Mr. Winters, in his sixteen years of operating service stations, has never experienced a floor drain with such an adapter that was not connected to an underground storage tank. Further, he had previously leased a service station that had been purchased from Exxon after being closed for seven years and the used oil tank was still in place at the time he took possession of the station. He asked the person responsible for closing the Exxon station (the Puckett site) where the used oil tank was located. That person responded by pointing to an area of landscape shrubbery where a galvanized pipe could be seen protruding from the ground. A used oil collection company attempted to pump the contents of the tank using that pipe. Three large holly bushes were growing undisturbed over the area where Mr. Winters had been told the tank was located. It thus appeared to Mr. Winters that the tank could not have been removed. There was no evidence that Mr. Winters attempted to conceal the discharge of the oil or that he continued to dispose of the used oil in the floor drain after discovering that the tank had been removed. If the floor drain had not become stopped up, Mr. Winters likely never would have begun looking for the presence of the tank. A used oil collection company never was able to pump any used oil from the pipe supposedly connected to the tank. It was Mr. Winters' belief that used oil collection companies normally came to service stations after closing hours to pump the used oil storage tanks, so they can avoid paying for the used oil. It was for this reason, he believed, that he rarely had seen a used oil collection company trying to pump oil from such a storage tank. He was thus not concerned when the company reported that it could pump no used oil from the tank because he believed that another used oil collector had previously drained it. The used oil discharged at the Puckett site consists of used engine crank case oil with an estimated two percent of used transmission oil. Used oil at the Puckett site is not mixed with solvents or other hazardous wastes. Puckett does not accept neighborhood collections of used oil. An assessment of the contamination at the Puckett site was conducted by Delta Environmental Consultants. Delta had an analysis of soil samples prepared by Pioneer Laboratories and an analysis of ground water samples by Savannah Laboratories. Dr. Litt, the Petitioner Puckett's expert witness, opined, based on the contamination assessment, that the contamination was due to used oil or "used oil fuel" instead of "hazardous waste fuel" or hazardous waste. Dr. Litt relied on the testimony of Mr. Winters to the effect that solvents or other hazardous wastes were not mixed with the used oil at the Puckett site in the service station's operations. Based on the soil and ground water analyses supplied him, Dr. Litt found an absence of halogenated solvents which would commonly be mixed with used oil, thus corroborating Mr. Winters' testimony that the used oil at the Puckett facility was not known to have been mixed with any hazardous wastes. The soil analysis indicates a level of organic halogens of 1,090 parts per million. This level might raise a presumption, under relevant EPA regulations, that the oil had been mixed somewhat with hazardous wastes, but Dr. Litt established that indeed no mixing had occurred based upon Mr. Winters' testimony, as well as the fact that the testing method used is accurate to only a plus or minus 700 parts per million in a total range of 1,000 to 2,000 parts per million. Indeed, some halogen levels may be attributed to natural soil conditions. Thus, the finding of 1,090 parts per million organic halogens could be as much as 700 parts per million in error, and some of this quantity can be due to natural backgrounds. Additionally, the level of individual chlorinated solvents sampled indicated no mixing of used oil with typical hazardous wastes. International Petroleum Corporation International Petroleum Corporation (International) has operated an oil storage plant and used oil reclamation facility at 105 South Alexander Street, Plant City, Florida, since May 1980. That site contains approximately 10 acres. There are two on-site tank farms containing 17 above-ground stationary tanks and two underground tanks. One underground tank holds 10,000 gallons and is used to store diesel fuel. The other tank holds 5,000 gallons and stores virgin gasoline. The above-ground tanks range in size from 8,000 to 212,000 gallons and are used to store oil, both used oil and new oil. All the tanks have been registered with the DER in accordance with its rules and are a part of the DER's "stationary tank system." The plant site also contains an office building and a testing laboratory which provides an array of testing services. The lab contains an atomic absorption unit, kinematic viscosity baths, API gravity hydrometers, distillation equipment and a gas chromatography. International uses this equipment, operated by a trained chemist, to test incoming loads of oil for such things as viscosity, flash point, API gravity, heavy metals, halides, etc. Since 1980, International has received, processed and sold more than 5,000,000 gallons of oil from this facility. The oil processed through the facility includes virgin kerosene, diesel, jet fuel and oils of various grades ranging from ASTM grade numbers 1-4 (the distillates) and ASTM grade numbers 5, 6 and "bunker C" (the residuals). The residual oils are those oils left after the lighter distillates are removed through the vacuum distillation process. The amount of residual oils processed since 1980 is relatively low, less than fifteen percent of the total amount of oils processed at International's facility. Out of 7,000,000 gallons processed in an average year, the plant may receive two or three carloads of grade numbers 5, 6 or bunker C. From 1980 to 1985, approximately 7,000,000 to 12,000,000 gallons of virgin oils were processed at the facility. In each of those years, from 4,000,000 to 7,000,000 gallons of used oil were also processed. Over that five- year period approximately 20,000,000 gallons of used oil were processed and sold through the International facility. International blends virgin oils received at the plant with used oils to meet particular specifications of a customer. It uses its own trucks to collect oil from service stations, automobile dealerships and other industrial accounts. Oil is then delivered to the plant and tested for basic constituents before being placed in an appropriate storage tank. International tests all incoming used oil to see if it meets the criteria for so-called "on spec" used oil or "off spec" used oil. These specifications were established by the EPA in 1985 and adopted by the DER. Used oil meeting these criteria may be burned as fuel in industrial and non-industrial boilers without limitations. The criteria are as follows: Constituent/Property Allowable Level Arsenic 5 ppm maximum Cadmium 2 ppm maximum Chromium 10 ppm maximum Lead 100 ppm maximum Total Halogens 4,000 ppm maximum Flashpoint 100 degrees Fahrenheit minimum International has followed a practice of rejecting incoming used oil which fails to meet the criteria of 1,000 parts per million or less of total halogens, which is the rebuttable threshold presumption of "hazardous waste" oil. International makes an effort to ensure that used oil it receives and processes is thus "on spec." It regularly sends samples to independent laboratories to cross-check its own laboratory testing results. It is selective in its sources of used oil and typically obtains used oil from large companies such as the Mack truck shops, car dealerships and other large volume producers of used oil. These are sources unlikely to be contaminated with any hazardous materials. The "on-spec" used oil accepted by International is placed in separate storage tanks, segregated according to water content and API gravity, viscosity and lead content. It is then blended with virgin oils to meet the specification of various customers. Heat is sometimes supplied in order to drive off water. The used oil undergoes no further treatment or alteration, being merely tested and blended to meet the customer's requirements. Often blending is unnecessary. When a truckload is received, tested and found to meet specifications, it is sometimes directly delivered to a customer. International sometimes obtains used oil without payment from its suppliers and has often purchased it from the generators of used oil. It always sells it to its customers, however. It has a definitely defined industrial market as a fuel commodity and is recognized as having value when sold for such purposes. It may sell for as little as 30 cents per gallon and has sold for much more than that, depending on the market conditions prevailing at the time of sale. It is used both as a burner fuel for industrial and non-industrial boilers, as well as a key constituent in the phosphate beneficiation process. International sells approximately 40 percent of its used oil production to asphalt plants where it is used to fire burners and to rock drying mills, also as a burner fuel. It sells approximately 60 percent of its production of used oil to the phosphate companies for the beneficiation process. In that process, oil is used with other reagents and fatty acids to "float" phosphate out of the rock or ore in which it is contained, allowing it to be skimmed and separated. Although the oil is not burned as a fuel in this process, its use by the phosphate plants substitutes for virgin oils of ATM grade numbers 4 and 5 (heating oil) or in some cases kerosene or number 2 diesel. In 1985, International produced 4,295,101 gallons of used oil which were burned as a fuel by its customers and in 1986 produced 2,221,652 gallons of used oil which were burned as a fuel. The used oil which it sells for the beneficiation process meets DER and EPA standards for "on spec" used oil fuel, except for the lead content, which fact is immaterial to its use for the beneficiation of phosphate. The used oil sold for phosphate purposes does meet pertinent regulatory standards for "off spec" used oil, in any event, so that it could be burned as industrial furnace fuel under EPA and DER rules. The sale of used oil for final use as a burner fuel is very common. Many oil recyclers pick up used oil and take it directly to asphalt plants for burning as fuel without any blending or other treatment. International's sale of 60 percent of its used oil for phosphate processing is unique in the used oil industry, but is attributable to its close proximity to the central Florida phosphate plants. Most oil recycling facilities sell a larger percentage of their product for burner fuel than does International. The used oil which International sells as burner fuel is comparable to heating oil, ASTM grade numbers 2 or 4 and has a similar viscosity, specific gravity and flash point. It can be poured and handled without preheating. Residual oil, however, such as grade numbers 5 and 6 (bunker C) are very viscous and require preheating in industrial boilers or burner furnaces before it can be burned as fuel. The used oil sold by International Petroleum is more similar to ASTM grades 2 and 4 (the distillates) than it is to grades 5 and 6 (the residuals). Petroleum hydrocarbon contamination of the soil and groundwater at the International site was discovered in December 1983 by DER personnel. International retained a consultant to assess the site and determine the nature and extent of any contamination. It has already expended more than $50,000 in an effort to investigate and clean up petroleum contamination at its site. DER conducted a soil and groundwater site investigation in 1985, which showed that hydrocarbons were in the soil and that volatile organics were also present in the groundwater at the site. International has provided all background information requested by DER on site conditions existing prior to cleanup. This was for purposes of showing its entitlement to reimbursement eligibility. The contamination at the site consisted mostly of small leaks, drips and spills associated with loading and unloading railway tank cars, as well as stationary tanks, over at least a five year period. The storage tanks include integral piping systems, and some leakage occurred at hose or pipe connections. The petroleum products placed in the various tanks in the tank farm vary, so that the contamination existing at the site cannot be differentiated or attributed separately to used oils or virgin oils, to distillates (ASTM grades 1-4) or the heavier residuals. All are made up of hydrocarbons and their breakdown products in the ground are essentially indistinguishable. The record does not establish that any major or significant oil spills have occurred at the plant site and does not show that the operators have been particularly negligent or have failed to conform to industry standards. International has already taken remedial action by building high retaining walls and by removing contaminated dirt where repeated drippages occurred near the railroad tracks. Employees have received training to avoid leaks from hoses and pipes and have been instructed to clean up even small spills immediately. Valve equipment has also been upgraded. As a result of these efforts, subsequent testing of the monitoring wells at the site has shown that the groundwater condition has markedly improved and it may be possible that the cleanup action already taken will be sufficient to accord with regulatory standards for groundwater. Used Oil as "Petroleum" or "Petroleum Product" Used oil is derived from crude oil and consists primarily of engine lubricating oil which is a form of hydrocarbon and a special fraction of the original crude oil. The lubricating oil consists of vacuum distilled base oil and atmospheric distillate portions of crude oil produced at a refinery and further refined by processes involving wax removal and solvent extraction. The remaining portion of lubricating oil consists of additives added to the base oil to improve certain physical properties such as rust inhibition and to improve viscosity. Many of these additives, in turn, are substantially comprised of base oil themselves. Used oil also typically contains gasoline which condenses in the crank case, water, gasoline additives, lead sulfates, carbonates or oxides and other partial combustion products of gasoline motor fuel. Lead contained in used engine oil is produced by engines running on tetraethyl lead gasoline. This lead accumulates in the form of lead sulfate, lead carbonate or lead oxide, rather than tetraethyl lead in its original form. The sulfates, carbonates and oxides are insoluble and are not likely to be leached out by groundwater, in contrast to tetraethyl lead. Use of the oil does not change its basic chemical structure. The oil may be contaminated by various impurities resulting from partial combustion of gasoline, from rust, from condensed water and so forth, but these are essentially mechanical mixtures, rather than alterations of the chemical structure of the oil itself. Aside from water, when oil is pumped from the ground at the well, two substances are produced at the well head: crude petroleum oil and natural gas, including casing head gas. Used oil is similar in nature to the petroleum products specifically listed in Section 376.301(10), Florida Statutes (Supp. 1986). The predominant use of used oil is as a fuel, similar to diesel, kerosene and gasoline. A fuel is a material burned as a source of heat, rather than for disposal purposes. It can be either for propulsion purposes or for stationary equipment such as industrial boilers, asphalt plants and the like. Kerosene and diesel fuel are similar in terms of viscosity and BTU value to ASTM grade number 2 fuel oil. Used oil is thicker and more viscous than ASTM grades 2, 3 or 4, but not so viscous as grades 5 or 6. Neither does it have as high a BTU content as grade number 5 fuel oil. ASTM grade number 5 residual oil must be preheated before burning as a fuel. Viscosity is too high for the material to atomize properly at normal temperature. In fact, used oil can be used as a blending agent to blend down or reduce viscosity of grade number 5 oil and reduce the temperature to which number 5 oil must be preheated before burning. With some variance from one sample to another, used oil typically is similar in viscosity and BTU value to ASTM grade number 3 or 4 fuel oil. Gasoline, kerosene, diesel and used oil are all hydrocarbons which burn readily. These materials are mixtures of hydrocarbons, with additives which do not materially affect the properties of the hydrocarbon fuel, or its use as a fuel. Gasoline, in fact, is not classified by ASTM grade. Parenthetically, it thus appears that the Legislature did not intend to limit the scope of "petroleum product" by such considerations as only viscosity and BTU value. "Petroleum products" are commonly used as fuels and are typically stored at service stations or storage tank facilities which can pose a danger of causing inland soil or water contamination, if improperly discharged. Gasoline, kerosene, diesel and used oil are commonly stored in tanks at facilities throughout the state. Used oil does not have any meaningful similarity to the substances specifically excluded from the definition of petroleum or petroleum product by Section 376.301(10), Florida Statutes (Supp. 1986). Used oil, for instance, bears little similarity to liquefied petroleum gas or to petrochemical feed stocks, which latter products are used to supply the raw materials for chemical plants manufacturing petrochemicals of many types. Used oil only is similar to these substances to the extent that it is within the broad family of hydrocarbons derived from crude oil or gases, derived in turn from petroleum wells. Likewise, the ASTM Grades 5 and 6 residual oils are based on the residuum or the heave viscous material left after the distillation process is applied to crude oil. This residuum is the material left that is too heavy to further distill. On the other hand, crank case lubricating oils and transmission oils, which are typically involved in the category "used oil" or "used oil fuel," are derived by the process of vacuum distillation such that they are distillation products, as opposed to residual products. "Bunker C" oils, and marine bunkering oils generally, are residual fuel products and, together with asphalt oil, are not used as fuel, at least not at inland locations. These materials likewise are typically not stored at inland service stations or bulk storage or reclamation facilities and locations. Both the Federal Environmental Protection Agency (EPA) and the Florida DER, in their regulatory scheme concerning used oil, encourage its collection and recycling. Used oil is typically recycled as a fuel and as a lubricant, by being separated from its contaminants by a re-refining process. Indeed, the oil constituent of used oil is not altered by use as lubricating or transmission oil, but rather is rendered in a "used oil" state by being subjected to various contaminants. It is not presently economically viable, given low virgin oil prices, to recycle used oil for lubricating oil. Thus, the two alternatives for disposition of used oil are to deposit it in landfills, a practice now generally prohibited by the DER and other regulatory authorities, or to use it as a fuel. Indeed, the use of used oil as a fuel is about the only practical way to dispose of it safely and legally in view of former uses, such as road oiling for dust control and weed abatement, now being prohibited in potable water aquifer areas. Section 403.75(2), Florida Statutes (1985). Thus, it is not only common and general practice to burn used oil as a boiler fuel and as a fuel in various industrial and utility plants, at the present time-that is almost the only manner in which it can be legally and safely disposed of. The Department itself has a policy encouraging the collection and recycling of used oil, as lubricating oil, fuel or as a feed stock in the manufacturing of other petroleum products. (See IP Exhibits 17, 18 and Joint Exhibit 5 in evidence.) Under EPA regulations which have been adopted by DER, used oil is not regulated as a hazardous waste. Under these regulations, the EPA has adopted a "rebuttable presumption of mixing" in order to distinguish between used oils which have been contaminated through mere use and used oils which have been mixed with hazardous wastes and therefore must be regulated as hazardous wastes or "hazardous waste fuel." Certain hazardous, halogenated constituents, such as chlorinated solvents, are the hazardous wastes typically found mixed with used oil. The "presumption of mixing" provides that any used oil containing greater than 1,000 parts per million of total halogens (such as chlorine, fluorine, bromine, iodine and similar substances) is presumed to have been mixed with a hazardous waste and will be regulated as "hazardous waste fuel" under 40 CFR Part 266, Subpart D, rather than as "used oil fuel" under 40 CFR Part 266, Subpart E. Hazardous waste fuel is essentially a hazardous waste with a BTU value of at least 5,000 BTUs per gallon. Hazardous waste fuel burning is tightly regulated by the EPA and DER. The presumption of mixing can be rebutted through a demonstration that the used oil in question has not been mixed with any hazardous waste. If mixing of used oil with hazardous wastes is known to have occurred, however, the oil is regulated as a hazardous waste when it is burned for energy recovery. Once it has been determined that a particular used oil is a used oil fuel and not a hazardous waste, the used oil falls into one of two categories: "Specification used oil fuel" or "off-specification used oil fuel." Specification used oil contains essentially the same toxic constituents as virgin oil fuels. Off-specification used oil fuel contains elevated levels of toxic components. Most used oil is off-specification, particularly if it is made up of mixtures of several types of used oil. If oil comes from a service station which was used in an engine burning leaded gasoline it would likely result in the used oil from that engine being off-specification due to the toxic lead compounds which would be present in the oil. If the oil was used in an engine which burned unleaded fuel, it is likely that it would be within specification limits for "on-specification used oil." Neither type of used oil is regulated as hazardous waste when burned as fuel, however. For purposes of determining whether an oil fuel is off-specification on on-specification, the EPA has developed a list [at 40 CFR Section 266.40(e): of contaminants, with the allowable levels for each contaminant, below which oil will be determined to be "on specification." Those contaminants are arsenic (5 ppm), cadmium (2 ppm), chromium (10 ppm), lead (100 ppm), with total halogens not exceeding 4,000 ppm in order for used oil to be within specification for nonindustrial burning. Specification used oils may be burned as fuel in nonindustrial boilers, including schools, hospitals, and apartment buildings. Off-specification used oil fuel may be burned in industrial furnaces, industrial boilers, utility boilers and some space heaters meeting certain federal safety requirements. Moreover, EPA regulations allow the blending of off-specification and specification used oil so that the resultant used oil, when burned, meets the specifications for nonindustrial burning. The Department's policy makers who were responsible for the initial decision that used oil is not petroleum or a petroleum product did not consult with certain key personnel in the Department's own used oil section concerning whether oil should be considered as a petroleum or petroleum product. In fact, Mr. Gentry, who is involved in policy making regarding the subject matter of the "Super Act," was not aware that the Department has a program to encourage the burning of used oil as a fuel nor the fact that used oil is extensively burned as a fuel in Florida.
Recommendation Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence of record, the candor and demeanor of the witnesses, and the pleadings and arguments of the parties, it is, therefore RECOMMENDED that the applications of Puckett Oil 4 Company and International Petroleum Corporation for eligibility for reimbursement pursuant to Section 376.3071(12), Florida Statutes (Supp. 1986), be granted. DONE and ENTERED this 7th of June, 1988, in Tallahassee, Florida. P. MICHAEL RUFF 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 7th day of June, 1988. APPENDIX TO RECOMMENDED ORDER CASE NOS. 87-2161 & 87-2465 Petitioners' Proposed Findings of Fact: 1-23. Accepted. 24. Rejected as subordinate to the Hearing Officer's findings on this subject matter. 25-38. Accepted. 39-40. Rejected as subordinate to the Hearing Officer's findings and as not directly material. 41-45. Accepted. 46-48. Rejected as not material and relevant. 49-54. Accepted. 55. Rejected as subordinate to Hearing Officer's findings on this subject matter. 56-58. Accepted. 59. Rejected as subordinate to Hearing Officer's findings on this subject matter. 60-63. Accepted. 64. Rejected as subordinate to the Hearing Officer's findings on this subject and as unnecessary to the resolution of material issues. 65-70. Accepted. 71. Rejected as irrelevant. 72-77. Rejected as subordinate to the Hearing Officer's findings on this subject. Accepted, but not directly relevant and material. Accepted. Respondent's Proposed Findings of Fact: 1-5. Accepted. 6. Rejected as subordinate to the Hearing Officer's findings on this subject matter. 7-8. Rejected as subordinate to the Hearing Officer's findings on this subject matter and as immaterial, in part, because the Hearing Officer, in determining whether the material at the subject sites meets the statutory definitions at issue is not, by the "pleading" confronted with the issue of whether any and all types of "used oil" meet these definitions, rather merely those types comprising the contamination at Petitioner's facility. The Hearing Officer cannot, in this proceeding, issue declaratory statements or advisory opinions. Accepted. Accepted, except for the next to last sentence. 11-12. Accepted. Accepted as to its historic accuracy, but not as a resolution of the essential issue presented. Rejected as immaterial in the absence of a Motion to Compel further, more detailed answers. Accepted as to its historical accuracy, but, for reasons similar to the ruling next above, not as probative of the appropriate, timely raising of the issue of gross negligence. 16-24. Accepted. 25-26. Rejected as subordinate to the Hearing Officer's findings on this subject matter. Accepted. Accepted as to its historical import. 29-38. Accepted. 39. Rejected as subordinate to the Hearing Officer's findings on this subject matter and as contrary to the preponderant evidence of record. 40-43. Accepted. 44-45. Rejected as subordinate to the Hearing Officer's findings on this subject matter. Rejected as not constituting a finding of fact, but, rather, a conclusion of law and statement of policy. Rejected as contrary to the preponderant evidence, as subordinate to the Hearing Officer's findings and as largely immaterial. Rejected as subordinate to the Hearing Officer's findings on this subject matter. Accepted. Rejected as subordinate to the Hearing Officer's findings on this subject matter; as being partially immaterial and as a discussion of policy and not a pertinent finding of fact. 51-53. Rejected as constituting legal argument and not a finding of fact. 54-55. Rejected as constituting legal argument. 56. Rejected as subordinate to the Hearing Officer's findings on this subject matter and as contrary to the preponderant weight of the evidence. 57-58. Rejected as - subordinate to the Hearing Officer's findings on this subject matter. Accepted. Rejected as subordinate to the Hearing Officer's findings on this subject matter. 61-63. Rejected as subordinate to the Hearing Officer's findings on this subject matter and as contrary to the preponderant weight of the evidence. Rejected as subordinate to the Hearing Officer's findings on this subject matter and as contrary to the preponderant weight of the evidence and as constituting, in part, legal argument instead of fact finding. Accepted. Rejected as subordinate to the Hearing Officer's findings on this subject matter. Rejected as subordinate to the Hearing Officer's findings on this subject matter. Rejected as subordinate to the Hearing Officer's findings on this subject matter and as contrary to the preponderant weight of the evidence. Accepted. Rejected as subordinate to the Hearing Officer's findings on this subject matter and as contrary to the preponderant weight of the evidence. Accepted. Rejected as subordinate to the Hearing Officer's findings on this subject matter. Rejected as subordinate to the Hearing Officer's findings on this subject matter and as contrary to the preponderant weight of the evidence. Accepted. Rejected as subordinate to the Hearing Officer's findings on this subject matter, as contrary to the preponderant weight of the evidence and, standing alone, of scant materiality in proving whether used oil is a "petroleum product" or a "fuel commodity." Rejected as contrary to the preponderant weight of the evidence. 78-80. Accepted in part, but not as to its material import and subordinate to the Hearing Officer's findings on this subject matter. 81-84. Rejected as subordinate to the Hearing Officer's findings on this subject matter and as contrary to the preponderant credible evidence. 85. Rejected as subordinate to the Hearing Officer's findings on this subject matter and as contrary to the preponderant credible evidence and as largely immaterial. 86-87. Rejected as immaterial to the ultimate factual and legal issues. 88-89. Accepted. Rejected as subordinate to the Hearing Officer's findings on this subject matter and as contrary to the preponderant credible evidence. Accepted. 92-93. Rejected as subordinate to the Hearing Officer's findings on this subject matter. 94-95. Rejected as subordinate to the Hearing Officer's findings on this subject matter and not in itself material. Rejected as subordinate to the Hearing Officer's findings on this subject matter. Rejected as not comporting with the preponderant weight of the evidence and as immaterial. Rejected as immaterial and irrelevant. Rejected as subordinate to the Hearing Officer's findings and as not directly material and relevant. Rejected as not in accordance with the preponderant weight of the evidence. Rejected as subordinate to the Hearing Officer's 4 findings on this subject matter. 102-103. Rejected as subordinate to the Hearing Officer's findings on this subject matter and as to its purported material import. 104. Rejected as subordinate to the Hearing Officer's findings on this subject matter and as to its purported material import and further as not being in accord with the preponderant weight of the evidence. 105-106. Rejected as constituting legal argument and discussion. 107-109. Rejected as constituting legal argument and discussion and as contrary to the preponderant weight of the evidence. 110-111. Rejected as constituting legal argument and discussion. 112-113. Rejected as constituting legal argument and discussion and as contrary to the preponderant weight of the evidence. Rejected as constituting legal argument and discussion. Accepted but subordinate to the Hearing Officer's findings and not, in itself, material to the legal issue sub judice. Rejected as contrary to the preponderant weight of credible evidence. Rejected as not in itself material and as contrary to the preponderant weight of the credible evidence. Rejected as not in itself material and as contrary to the preponderant weight of the credible evidence and as constituting legal argument and discussion. 119-120. Rejected as subordinate to the Hearing Officer's findings on this subject matter and as to its purported material import and further as not being in accord with the preponderant weight of the evidence. COPIES FURNISHED: Robert D. Fingar, Esquire HUEY, GUILDAY, KUERSTEINER & TUCKER Regulation Suite 510 First Florida Bank Building Post Office Box 1794 Tallahassee, Florida 32302 Dale Twachtmann, Secretary Department of Environmental Blair 2600 Stone Road Tallahassee, Florida 32399. L. Caleen, Jr., Esquire OERTEL & HOFFMAN 2400 Blair Stone Road Tallahassee, Florida 32301 E. Gary Early, Esquire Department of Environmental Regulation 2600 Blair Stone Road Tallahassee, Florida 32399-2400
Findings Of Fact At all times pertinent to the allegations contained herein, Pioneer Oil Company was a licensed distributor of petroleum products in Florida, and the Department was the state agency responsible for overseeing and regulating the sale of petroleum products in this state. On May 9, 1990, the owner of Port Stop #4 in Duette, Florida, a seller of Pioneer's petroleum products at retail, requested Pioneer, as its supplier, to change over a storage tank, previously used for the storage of diesel fuel, to storage for gasoline and vice versa. Petitioner agreed but waited until the customer was nearly out of product to make the switch, and when that had happened, sent its pump truck to the facility to pump the remaining fuel out of the tankss. Pioneer's employee did pump out what he believed was all the fuel remaining in the tanks. However, because unknown to him or to anyone else, the tanks were tilted in the ground, the pumping operations left some of each fuel in its respective tank. When the fresh fuel was then placed into these new tanks, it was contaminated by that previous stock remaining therein after the pumping. On May 29, 1990, an inspector from the Department took samples of the diesel fuel, suppled from Petitioner, from the underground tank. When this sample was tested, it was found to be contaminated by the gasoline remaining in the tank after pumping. That diesel fuel did not meet state standards and was illegal. Because the unleaded pump was not working that day, that product could not be sampled. Therefore, a second sample, this time of unleaded gasoline, was taken on May 31, 1990, and it, too, was found to be contaminated by the diesel fuel which remained in that tank after pump out. This fuel did not meet state standards, either, and also was illegal. The diesel fuel sold at retail for $1.159 per gallon, and 1,359 gallons of the product had been sold. The unleaded gasoline sold at retail for $1.099 per gallon, and 4,997 gallons of that product had been sold. The Department is authorized to assess a penalty of up to $1,000 for each illegal product sold, depending on the amount sold. Since more than 1,000 gallons of each product was sold, the maximum penalty was assessed in each case. Mr. McGary claims that since the station where the incident took place was not owned by Pioneer, which is merely the product supplier, it was not legally obligated to pay the assessment. However, he admits that as a matter of business practice, since the products in issue were Pioneer products, since Port Stop #4 was a customer, and since it was a Pioneer employee who made the swap, it agreed to do so. Had it not made the swap, the dealer, (Port Stop #4) would have had to hire someone else to do it and Pioneer would have felt no obligation to assume the financial burden. He also claims that had the unleaded gasoline pump been working on May 29, 1990, the contamination of that product would have been found at the same time the other was found, and there would have been only one violation. This does not necessarily follow, however.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore: RECOMMENDED that a Final Order be issued by the Department of Agriculture and Consumer Services affirming the imposition of bond and assessment against the bond posted by Petitioner, Pioneer Oil Company, in each of the incidents of illegal product discovered at Port Stop #4 in Duette, Florida, on May 29 and 13, 1990. RECOMMENDED this 31 day of October, 1990, in Tallahassee, Florida. ARNOLD H. POLLOCK, 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 31 day of October, 1990. COPIES FURNISHED: Larry McGary General Manager Pioneer Oil Company 878 12th Street East P.O. Box 9046 Bradenton, Florida 34206 Clinton H. Coulter, Jr., Esquire Department of Agriculture and Consumer Services 515 Mayo Building Tallahassee, Florida 32399-0800 Hon. Doyle Conner Commissioner of Agriculture The Capitol Tallahassee, FL 32399-0810 Ben Pridgeon, Chief Bureau of Licensing & Bond Department of Agriculture 508 Mayo Building Tallahassee, FL 32399-0800
The Issue The issue presented for decision herein is whether or not Petitioner's Antiknock (octane) Index number of its petroleum product was below the Index number displayed on its dispensing pumps.
Findings Of Fact Based upon my observation of the witnesses and their demeanor while testifying, documentary evidence received, and the entire record compile herein, I make the following relevant factual finding. Rafael Ruiz is the owner/operator of Coral Way Mobil, an automobile gasoline station, situated at 3201 Coral Way in Coral Gables, Florida. Ruiz has operated that station in excess of ten (10) years. On or about May 13, 1987, Respondent, Department of Agriculture and Consumer Services, received a customer complaint alleging that the fuel obtained from Petitioner's station made her automobile engine ping. Respondent dispatched one of its petroleum inspectors to Petitioner's station at 3201 Coral Way on May 14, and obtained a sample of Respondent's unleaded gasoline. Inspector Bill Munoz obtained the sample and an analysis of the sample revealed that the produce had an octane rating of 86.9 octane, whereas the octane rating posted on the dispenser indicated that the octane rating of the product was 89 octane. On that date, May 14, 1987, Respondent issued a "stop sale notice" for all of the unleaded product which was determined to be 213 gallons. Petitioner was advised by Inspector Munoz that the unleaded produce should be held until he received further instructions from the Respondent respecting any proposed penalty. On May 15, 1987, Petitioner was advised by John Whittier, Chief, Bureau of Petroleum Inspection, Florida Department of Agriculture and Consumer Services, that the Antiknock Index number of the sampled product was 2.1 percent below the octane rating displayed on the dispenser and that an administrative fine would be levied in the amount of $200 based on the number of gallons multiplied times by the price at which the product was being sold, i.e., 213 gallons times 93.9 cents per gallon. Petitioner did not dispute Respondent's analysis of the product sample, but instead reported that he had been advised that three of the five tanks at his station were leaking and that this is the first incident that he was aware of wherein the product tested below the octane rating displayed on the dispenser.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is hereby RECOMMENDED: That the Respondent, Department of Agriculture and Consumer Services, enter a Final Order imposing an administrative fine in the amount of $200 payable by Petitioner to Respondent within thirty (30) days after entry of the Respondent's Final Order entered herein. RECOMMENDED this 7th day of October, 1987, in Tallahassee, Leon County, Florida. JAMES E. BRADWELL 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 7th day of October, 1987. COPIES FURNISHED: Rafael E. Ruiz c/o Coral Way Mobil 3201 Coral Way Miami, Florida 33145 Clinton H. Coulter, Jr., Esquire Senior Attorney Office of General Counsel Department of Agriculture and Consumer Services Room 514, Mayo Building Tallahassee, Florida 32399-0800 Honorable Doyle Conner Commissioner of Agriculture The Capitol Tallahassee, Florida 32399-0810 Robert Chastain, Esquire General Counsel Department of Agriculture, and Consumer Services Room 513, Mayo Building Tallahassee, Florida 2399-0800
The Issue The issues to be determined in this case are whether Respondents should pay the administrative penalty, investigative costs, and attorney’s fees and undertake the corrective actions that are demanded by the Florida Department of Environmental Protection (the “Department”) as set forth in the Final Amended Notice of Violation, Orders for Corrective Action, and Administrative Penalty Assessment.
Findings Of Fact The Parties The Department is the administrative agency of the state of Florida having the power and duty to protect Florida’s air and water resources and to administer and enforce the provisions of chapters 376 and 403, Florida Statutes, and the rules promulgated thereunder in Florida Administrative Code Title 62. Germain is a licensed Florida attorney. From May 2006 to January 2013, Germain was the record owner of the real property at 1120 West Main Street, Leesburg, Lake County, Florida (the “Germain property”). Leesburg’s is an active Florida corporation that was incorporated in January 2013 by Germain. Germain is Leesburg’s sole corporate officer and sole shareholder and has managerial authority over the Germain property. John Doe 1-5 is a placeholder designation used by the Department for the purpose of covering all potential entities to which Germain might transfer the property. No other such entity materialized. Background A gas station was operated on the Germain property continually from the 1920s through the late 1980s. During the 1980s and perhaps for a longer period, C.E. Griner operated the gas station under the name Griner’s Service Station. Griner’s Service Station had at least three underground storage tanks (“USTs”) used to store leaded and unleaded gasoline. In 1989 or 1990, Griner ceased operation of the gas station and the USTs were filled with concrete and abandoned in place. The Germain property has not been used as a gas station since that time. In 1990, the Department inspected the Germain property and prepared a report. The inspection report noted that the USTs at the Germain property “were not cleaned properly prior to filling with concrete.” The report also noted that the tanks were not properly abandoned in place. No evidence was presented to explain in what way the tanks were not properly abandoned, or to indicate whether the Department took any enforcement action based on this report. In 1996, Gustavo Garcia purchased the Germain property from Griner. In May 2006, Germain purchased the property from Garcia. Another gas station, operating for many years under several names (now “Sunoco”), is located at 1200 West Main Street, across a side street and west of the Germain property. Since 1990, one or more discharges of petroleum contaminants occurred on the Sunoco property. There were also gas stations at the other two corners of the Main Street intersection, but no evidence was presented about their operations or conditions. In March 2003, apparently as part of a pre-purchase investigation, testing was conducted at the Sunoco property that revealed petroleum contamination in the groundwater. Soil contamination was not reported. S&ME, Inc. (“S&ME”), an environmental consulting firm, subsequently submitted a discharge report to the Department’s Central District Office in Orlando. Later in 2003, S&ME conducted an initial site assessment for the Sunoco property. In the report it produced, S&ME noted that it found concentrations of petroleum contaminants in the groundwater that were above the Department’s Groundwater Cleanup Target Levels (“GCTLs”). The concentrations exceeding GCTLs were in samples taken from the eastern side of the Sunoco property, closest to the Germain property. In 2004, S&ME completed a Templated Site Assessment Report for the Sunoco property. Groundwater samples from the eastern portion of the Sunoco property again revealed petroleum contamination exceeding GCTLs. Garcia, who owned the Germain property at the time, allowed S&ME to conduct soil testing on the Germain property. The soil samples were taken by direct push methods and were tested with an organic vapor analyzer (“OVA”), which revealed toluene, ethylbenzene, total xylenes, naphthalene, 1-methyl naphthalene, and total recoverable petroleum hydrocarbons exceeding the Department’s Soil Cleanup Target Levels (“SCTLs”). In 2005, another private environmental consulting firm, ATC Associates, Inc. (“ATC”), performed a Supplemental Site Assessment on the Sunoco property and produced a report. As part of its assessment, ATC installed three monitoring wells on the Germain property and collected groundwater samples. These groundwater samples revealed petroleum constituent concentrations that exceeded GCTLs and were higher than concentrations found in groundwater samples taken under the Sunoco property. Both the 2004 and 2005 site assessment reports concluded that the groundwater in the area flowed from the southeast to the northwest; that is, from the Germain property toward the Sunoco property. Germain referred to a figure in S&ME’s 2004 report that he claimed indicated a southeasterly flow of groundwater from Sunoco toward the Germain property. However, a preponderance of the evidence establishes that groundwater flow in the area is generally northwesterly from the Germain property toward the Sunoco property. Based on the results of its testing, ATC concluded in its site assessment report that the groundwater contamination on the eastern portion of the Sunoco property had migrated from the Germain property. ATC also took soil samples from the Germain property. It screened the soil samples with an OVA and reported petroleum contamination exceeding the Department’s SCTLs. Petroleum contamination in soil typically does not travel far horizontally. It remains in the vicinity of the source. Therefore, the soil contamination found on the Germain property indicates an onsite source of the contamination. All of the assessment reports were filed with Seminole County, presumably with the Department of Public Safety, Emergency Management Division, which is the local entity with which the Department contracted to inspect and manage petroleum facilities in the area. These reports were public records before Germain purchased his property. A June 2005 Memorandum from Seminole County informed Bret LeRoux at the Department’s Central District Office that ATC’s 2005 site assessment report indicated the Germain property was the source of petroleum contamination. The Memorandum recommended that the Department contact the owner of the property about the contamination. The Memorandum was filed at the Department. After the Department received the Memorandum, it requested and received the site assessment reports from Seminole County. The Department did not notify Garcia or the public about the contamination in 2005. The Department did not notify Germain about the contamination until August 2007. All Appropriate Inquiry The principal factual dispute in this case is whether Germain undertook “all appropriate inquiry into the previous ownership and use of” the Germain property before purchasing it, as required by section 376.308(1)(c)1/: [A person acquiring title to petroleum- contaminated property after July 1992] must also establish by a preponderance of the evidence that he or she undertook, at the time of acquisition, all appropriate inquiry into the previous ownership and use of the property consistent with good commercial or customary practice in an effort to minimize liability. Before he purchased the Germain property in 2006, Germain knew that it had been a gas station for a number of years. Garcia told Germain that the USTs had been filled with concrete and were “within the law.” Germain was also aware that the Sunoco USTs had recently been excavated and that there was a problem with the tanks and possible contamination there. Germain said he spoke with neighbors about the property, but he did not say what he learned from them. Before the purchase, Germain conducted a visual inspection of the property and saw “several little metal plates” in the parking lot. Germain claimed it was only later that he learned that some of the plates were covers for groundwater monitoring wells. Germain said he visited and reviewed files at a Lake County office, but he was not specific about which county offices he visited. He also went to the Leesburg Historic Board to review property records. Germain’s testimony was not clear about what records he saw on these visits. Germain did not go to the office of the Seminole County Department of Public Safety, Emergency Management Division, to view records pertaining to the Germain property. He did not claim to have gone to the Department’s Central District Office in Orlando. In other words, Germain did not go to the offices of the agencies responsible for regulating petroleum USTs. Nor did Germain say that he talked to any knowledgeable employee of these agencies by telephone about possible contamination issues on the Germain property. While at a Lake County office, Germain searched the DEP website and saw two documents that indicated the USTs on the Germain property had been closed in place. One of the documents indicated a cleanup status of “no contamination.” Germain claimed that he relied on these documents to conclude that the property was clean. The Department explained that the phrase “no contamination” is used in its database as a default where no contamination has been reported and no discharge form has been filed. It is not a determination based on a site investigation that the site is free of contamination. However, the Department had received information that the Germain property was contaminated, so its explanation of the “no contamination” status for the Germain property was unsatisfactory. Germain does not practice environmental law. He neither claimed nor demonstrated knowledge or experience with the legal or factual issues associated with petroleum contamination. Germain did not present evidence to establish that he followed “good commercial or customary practice” in his investigation of the property as required by section 376.308(1)(c). Good commercial practice in the purchase of property upon which potentially contaminating activities have occurred entails consultation with a person with appropriate knowledge and experience. Germain did not consult with an environmental attorney or environmental consultant regarding the potential liability associated with property used as a gas station. If Germain had hired an environmental consultant to assist him, the consultant would have known where to find public records about the gas station, including any soil and groundwater analyses. An environmental consultant would have seen the site assessment reports and other public records that indicated petroleum contamination on the Germain property. A consultant would likely have recommended a Phase I environmental site assessment (“ESA”). A Phase I ESA entails, generally, determining past uses of a property, inspecting the property for visible indications of potential contamination, and reviewing aerial photographs, historical documents, and public records related to the property and its surroundings. A Phase II ESA would follow if potential contamination is discovered and usually includes taking soil and groundwater samples. In considering whether all appropriate inquiry was undertaken by a purchaser of contaminated property, section 376.308(1)(c) directs the court or administrative law judge to take into account: any specialized knowledge or experience on the part of the defendant, the relationship of the purchase price to the value of the property if uncontaminated, commonly known or reasonably ascertainable information about the property, the obviousness of the presence or likely presence of contamination at the property, and the ability to detect such contamination by appropriate inspection. Germain did not have specialized knowledge regarding the regulation of petroleum USTs. However, as a lawyer, he was familiar with the practice of employing or working with professionals with specialized knowledge in order to achieve the objectives or solve the problems of his clients. If Germain’s legal assistance had been sought by a client to solve an environmental problem, Germain would have declined to proceed because he did not possess the requisite knowledge or he would have sought the assistance of an environmental lawyer or environmental consultant. In purchasing the Germain property, Germain did not undertake the reasonable steps a lawyer must take for a client. No evidence was presented about the relationship of the purchase price to the value of the Germain property. Germain did not show that the site assessment reports and other documents discussed above were not “reasonably ascertainable information.” Although a visual inspection by a lay person would not have disclosed the presence of contamination at the property, an environmental consultant would have recognized the groundwater monitor wells and would have known to seek information about the reason for their installation and the groundwater sampling results. Taking all relevant considerations into account, Germain failed to show that he made all appropriate inquiry before he purchased the Germain property. Germain transferred the property to Leesburg’s in January 2013 in part to limit his potential personal liability for petroleum contamination. The Germain property is Leesburg’s primary asset. Because Leesburg’s took title to the Germain property after the NOV was issued, it had full knowledge of the contamination and cannot claim to be an innocent purchaser. Post-Purchase Investigation In August 2007, the Department sent Germain a letter informing him that the Department had reason to believe his property was contaminated with petroleum and requiring him to conduct a site assessment pursuant to rule 62-770.600(1).2/ In September 2007, the Department sent Germain the 2004 and 2005 site assessment reports. Germain did not conduct a site assessment. At the final hearing, the Department did not state whether it had made any effort to take enforcement action against Griner, whom the record evidence indicates was the owner of the gas station when the discharge occurred. In 2012, the Department issued Germain a notice of violation for failing to conduct a site assessment and remediation. After Germain transferred the property to Leesburg’s, the Department issued the Final NOV to add Leesburg’s as a Respondent. The Final NOV seeks penalties of $10,000 against Germain, and $10,000 against Leesburg’s. While investigating this matter, the Department incurred expenses of $11,380.37 in investigative costs. Confirmation of On-site Contamination Despite the site assessment reports that documented contamination on the Germain property, Germain disputed the Department’s claim that the property was contaminated. The Department conducted testing and completed a Site Investigation Report in 2010. Because Germain would not allow the Department onto his property, the Department installed groundwater monitoring wells adjacent to the Germain property to the west and south, and collected groundwater samples. The Department confirmed the northwesterly flow of groundwater documented in previous reports and found elevated levels of petroleum contaminants above GCTLs, including benzene, ethylbenzene, toluene, xylene, total lead, EDB, and total recoverable petroleum hydrocarbons. Monitoring wells west of, or downgradient of, the Germain property showed high levels of groundwater contamination, while monitoring wells to the south and southeast, or upgradient of the property showed no signs of contamination, indicating that the source of the groundwater contamination was on the Germain property. Based on the site assessments and its own investigation, the Department determined that the Germain property is the source of petroleum contamination detected along the eastern portion of the Sunoco property. Germain and Leesburg’s did not present any expert testimony to support their claim that the Germain property is not contaminated or that the contamination migrated to the Germain property from offsite. A preponderance of the record evidence shows that the Germain property is the source of the petroleum contamination found in the onsite soil and groundwater, as well as in groundwater on the eastern portion of the Sunoco property.
Findings Of Fact Puckett reported a discharge of used oil at its site when it filed an early detective incentive program notification application with DER. Puckett, thus, advised DER that it would clean up its site and apply for reimbursement of the costs of that cleanup in accordance with Section 376.3071(12), Florida Statutes (Supp. 1986). When it received Puckett's application, DER conducted an investigation of the site and determined that a discharge of used automotive crankcase oil had occurred there. DER was advised by Puckett that the discharge had occurred when used automotive crankcase oil was drained into a service bay floor drain. Puckett and the site operator placed the used oil in the drain in the belief that a storage tank was connected to the floor drain to receive and safely store the used oil. Unknown to Puckett, however, the storage tanks previously connected to that floor drain had been removed by a former site owner or operator. The Recommended Order entered by the Hearing Officer contains findings to the effect that Puckett was unaware that storage tanks did not any longer connect with the floor drain in question, in part, at least, because it is the custom and practice in the service station business that used oil collecting persons or entities collect from such storage tanks after the service station hours of operation. Therefore, it was customary for the operator of a service station not to be aware of when used oil was removed from storage tanks. Upon learning that used oil had been spilled at the site due to the lack of a storage tank, where formerly one had been in place, the subject application was filed. DER conducted its site investigation and after it was concluded, on April 16, 1987, issued an order denying reimbursement eligibility to Puckett. DER took this position because it opined that used oil is not "petroleum" or a "petroleum product", as those terms and substances are defined in Subsections 376.301(9)(10), Florida Statutes (Supp. 1986). Puckett then filed a timely petition for administrative hearing as a result of that denial of eligibility. The cause was duly transmitted to the undersigned Hearing Officer for conduct of a Section 120.57, Florida Statutes, formal proceeding. In the discovery phase of that proceeding, requests for admissions were served by Puckett upon DER, in response to which DER admitted that the sole basis for denial of reimbursement eligibility was the fact that the substance discharged was used oil, which, DER contended was not "petroleum" or a "petroleum product". DER, thus, took the position that the used oil in question was beyond the scope of reimbursement eligibility allowed by the "Super Act," the statutory provisions cited above. The cause was duly scheduled for hearing for September 9-10, 1987. Shortly prior to the hearing, on August 31, 1987, DER filed a motion for continuance seeking an opportunity thereby to have time to explore the question of whether Puckett was "grossly negligent" in the maintenance of its facility, which is a ground for disqualification from Super Act reimbursement eligibility. This was an issue which had not theretofore been raised in the proceeding. See Section 376.3071(9)(b)3., Florida Statutes (Supp. 1986). That motion for continuance was denied, as found and discussed in the Recommended Order in the underlying proceeding. The cause then came on for hearing as scheduled on September 9-10, 1987. A motion in limine filed by Puckett was granted at the hearing so as to preclude DER from raising any issue concerning "gross negligence" at hearing. The basis for the ruling was that DER had known of the circumstances surrounding the discharge for nearly one year, but that during the discovery process, DER assured Puckett that its position was that gross negligence would not be an issue in the proceedings and that the sole basis for its denial of the reimbursement application was that the substance discharged, being used oil, was not, in its view, "petroleum" or a "petroleum product". Following the hearing, the Hearing Officer issued the Recommended Order in question finding that used crankcase oil was, indeed, "petroleum", as well as being a "petroleum product", for the purposes of the definitions in the above- cited statutory provisions. It was thus recommended that Puckett be determined to be eligible to apply to DER for reimbursement of the cleanup costs involved. Puckett, 10 FALR at 5540. Certain findings and conclusions made in the Recommended Order are germane to the question of whether DER's actions with respect to the initial and final denial of Super Act eligibility had a reasonable basis in law and fact at the time the agency action was initiated and finally taken in the Final Order. Those findings include the findings in the Recommended Order that used crankcase oil consists of "petroleum", as that term is defined by Section 376.301(9), Florida Statutes (Supp. 1986), with particular emphasis on those findings and conclusions in the Recommended Order, incorporated by reference herein, concerning crankcase oil coming within the definition of "other hydrocarbons" for the reasons delineated in the Recommended Order. Further, DER's own expert witness admitted, and it was found by the Hearing Officer, that the predominant use of used oil is as a fuel, just as is gasoline, diesel, kerosene and certain other grades of fuel oil, which are specifically included in the statutory definition of "petroleum product". See page 20 of the Recommended Order and the transcript of the proceeding below, pages 362-363. It was also established without question that used oil is a "liquid," a "commodity" and a liquid fuel commodity for the reasons delineated in the Recommended Order. It was established further by the record in the proceeding on the merits, and found in the Recommended Order that used oil has no meaningful similarity to the substances specifically, statutorily excluded from the definition of "petroleum product", and that DER has had a policy encouraging the collection and recycling of used oil as a fuel. This was well-known and accepted by DER's own experts before the "policy makers" at DER, who engendered the subject initial agency action, took the position that used oil did not constitute petroleum or a petroleum product. Used oil has not been otherwise regulated as a hazardous waste. DER's interpretation of the statutory definition of "petroleum product" to the effect that the product, as it was initially produced, must be sold or used as a fuel in order to meet that definition, in fact, imposes an additional inconsistent criteria for determining what types of substances are included within the meaning of the term, which criteria is not enunciated in the statute, either expressly or implicitly. DER's restrictive interpretation of the statute further disregards the language of the Super Act. Sections 376.3071(12)(a) and 376.315, Florida Statutes (Supp. 1986), which requires it to give "such liberal construction to the statute as will accomplish the purposes set forth in this subsection", in other words, to promote the cleanup of as many contamination sites as possible. Further, it was established by the record in the proceeding on the merits and concluded in the Recommended Order that the restrictive interpretation of the statute adopted by DER was inconsistent with existing agency policy which encourages used oil collection and recycling and that the interpretation "is clearly not one expressed or reasonably implied on the face of the statute" and "would frustrate the clear, legislative impetus of the Super Act" and is "illogical". More significantly, DER's policy makers responsible for the initial agency action and decision that used oil is not "petroleum" or a "petroleum product" did not take counsel with certain key expert personnel in DER's own used oil section concerning whether used oil is "petroleum" or a "petroleum product" prior to the initial denial of eligibility and the proceeding and hearing before the Hearing Officer. In fact, the policy makers were apparently unaware of facts critical to the subject determination and to the fact that DER's proposed (and, indeed, final) action was inconsistent with agency policy concerning treatment and definition of used oil, which DER's "in- house" experts had been aware of all along. These findings and conclusions in the Recommended Order demonstrate clearly and in detail why DER's initial agency action and position through the conclusion of the hearing, concerning rejection of Puckett's reimbursement eligibility, did not have a reasonable basis in law and fact. Those findings and conclusions appearing at pages 18-36 of the Recommended Order, which has been stipulated into the record of the instant proceeding, are incorporated by reference and adopted in the findings of fact and conclusions of law in this Final Order. Despite the findings and conclusions in the Recommended Order, DER, in its Final Order, ultimately denied reimbursement eligibility. Puckett at page 5505. DER found in its Final Order that Super Act coverage is limited to "incidents related to storage", as opposed to incidents where a contaminant is discarded. DER also found that because Puckett did not have a "petroleum storage system" at the site, the discharge was not "related to storage", despite the facility operator's proven and found intention and belief, when he dumped the product in the floor drain, that he was "storing" the used oil in question. DER acknowledged the Hearing Officer's granting of Puckett's motion in limine, which precluded denial of reimbursement eligibility on "gross negligence" grounds, but stated that it was not denying eligibility on this ground at page 18 of its Final Order. Although DER acknowledged in its Final Order that its denial of eligibility did not depend on a finding of gross negligence, this acknowledgment, which appears to re- state its position, taken in the discovery phase, that gross negligence would not be raised as an issue by DER, and is an apparent acknowledgment of the ruling on the motion in limine, is somewhat belied by the following language from the Final Order: Although my decision to deny eligibility for reimbursement to Puckett does not depend on a finding of gross negligence on the part of Puckett, any site owner who fails to ascertain whether an oil drain fitting on site is actually connected to an operational used oil system now has clear notice that it allows used oil discharges to that drain fitting only at its own peril. It is not appropriate that state funds be expended to remediate contamination caused by reckless disregard for elementary waste disposal regulations. In the future, the department will continue to deny eligibility to any site where contamination has resulted from used oil discharges to land in the complete absence of a used oil storage system. (emphasis supplied) See pages 18 and 19 of the Final Order. Puckett then appealed that denial of reimbursement eligibility. The District Court of Appeals reversed DER, finding as follows: DER's assertion that Puckett's eligibility for cleanup reimbursement of the used oil discharge was dependent on whether storage was involved and whether the used oil would be reused or recycled was never made until the final agency order was entered. These issues were not raised by the pleadings, were not litigated at the hearing, were not considered by the Hearing Officer, and were not considered by the Hearing Officer's Recommended Order. In addition, the pleadings reflect that DER was asked in a written request for admission to admit the following: 'The Department's only basis for denial of Super Act eligibility for Puckett is that the reported discharge was used oil.' DER admitted that statement. This was the only issue created by the pleadings, and it was the only issue tried and determined by the Hearing Officer. DER cannot raise and decide for the first time in the final agency order issues not previously raised or considered. See Puckett, 549 So.2d at 722 (emphasis in original). The Court then remanded the proceeding to DER for entry of an order determining Puckett to be eligible to apply for reimbursement. Puckett also petitioned the appellate court for appellate attorney's fees pursuant to Section 120.57(1)(b)5., Florida Statutes, arguing that the Final Order was a "gross abuse" of agency discretion, a standard for granting of appellate attorney's fees under that statutory provision. The Court denied that motion on the basis that gross abuse of agency discretion had not been demonstrated. Although reliance on issues improperly raised for the first time in the Final Order may not have been a "gross abuse" of agency discretion supportive of an award of appellate costs and fees pursuant to the above- referenced statutory provision, it is found that DER has not justified as reasonable its rejection of eligibility on additional non-litigated or properly raised grounds in the Final Order. Therefore, DER's reliance on the new issues in the Final Order to deny reimbursement eligibility was not "substantially justified". After issuance of the Court's mandate, Puckett filed a petition for costs and fees pursuant to Section 57.111, Florida Statutes, initiating the instant proceeding. DER filed an untimely response conceding that Puckett was a "prevailing small business party" and the other criteria for award of fees and costs provided for in Section 57.111, Florida Statutes, with the exception that it did not concede that its denial of reimbursement eligibility in the related proceeding was not "substantially justified". DER did not dispute that the reasonable amount of costs and fees incurred by Puckett exceeded $15,000.00 nor did it assert that any special circumstances exist which would make an award of costs and fees unjust nor that it was a nominal party only. Since Puckett's petition was not timely responded to and since its Motion for Summary Final Order thereon was not answered by DER, the Hearing Officer issued a Summary Final Order awarding $15,000.00 in costs and fees to Puckett. DER appealed and the First District Court of Appeals reversed the award and remanded the proceedings to the Hearing Officer to consider DER's position on the issue of award of fees and costs, based generally upon the Court's view that DER's non- timely response to the petition for fees and costs should be excused, as more particularly delineated in the Court's opinion in Department of Environmental Regulation v. Puckett Oil Company, Inc., 16 FLW D.926 (Fla. 1st DCA April 3, 1991). The cause involving fees and costs, thus, became at issue before the Hearing Officer once again. In the prehearing filings, the parties limited the issues to that concerning whether DER's action on the reimbursement eligibility question was "substantially justified". On July 30, 1991, a hearing was held on this matter, during which the parties presented their arguments and stipulated that the record in this proceeding would be the record on appeal, including the Hearing Officer's Recommended Order in the reimbursement eligibility case.
