On Dec. 22, 1988, the U.S. Congress passed legislation that required owners or operators of underground storage tanks (USTs) to demonstrate their capability to pay for remediation costs and third-party damages in the event of a release into the environment.  Rules governing the requirements are contained in 40 CFR Subpart H.  In response, the 1990 Kentucky General Assembly created the Petroleum Storage Tank Environmental Assurance Fund (PSTEAF) to assist owners and operators of USTs in meeting the federal financial responsibility requirement and to provide reimbursement of eligible costs of corrective action due to a release from a UST system.

Monies for the fund come from an assurance fee of $0.014 assessed on each gallon of gasoline and special fuels imported to Kentucky.

The UST Branch currently maintains the funding source, PSTEAF, which is made up of the following three accounts:

• the Financial Responsibility Account (FRA)
• the Petroleum Storage Tank Account (PSTA)
• the Small Owners' Tank Removal Account (SOTRA)

The FRA provides coverage to meet the federally mandated financial responsibility requirement.  This account provides up to $1,000,000 for eligible corrective action and up to $1,000,000 for third-party liability.

The PSTA is intended for owners and operators who are ineligible for coverage under the FRA.  This account does not provide coverage to meet the third-party liability requirements.  PSTA does, however, provide reimbursement of up to $1,000,000 for eligible corrective action costs. Reimbursements from this account are determined by a ranking system based upon financial ability of the applicant and the potential or actual environmental harm that has resulted from a petroleum release. 

For more information about the PSTA or FRA accounts, contact Michele Westerfield at 502-564-5981 or 800-928-7782.

The SOTRA program was established to assist qualified small owners with the cost of routine removal of UST system(s), as a means of complying with state and federal requirements effective from 1998.  Unlike the FRA and PSTA accounts, the costs of tank removal are eligible for reimbursement, even if corrective action is not required by the cabinet.  This account does not provide reimbursement of corrective action costs.

For more information about the SOTRA program, contact Dennis Giles at 502-564-5981 or 800-928-7782.