What About Regulation

Historically, farmers have been exempt from many of the building and operations codes affecting commercial properties and businesses.

Farmers are reluctant to face another layer of regulations.

Farmers who store vehicle fuel on-site are affected by regulations in terms of both water quality protection and fire prevention.

In the short run, regulation compliance may have modest costs, but -- in the long run -- could "save the farm."

Water Quality Risks

Whether in use or abandoned, underground fuel storage tanks pose a substantial risk of groundwater contamination.

Improperly removed tanks, or those removed without proper soil testing, may still result in remnant contamination.

Both farm family health and farm livestock health are at risk from groundwater contamination.

Aboveground fuel storage tanks reduce some groundwater contamination risks, but surface water contamination risks are increased.

Fire Risks

Both underground and aboveground tanks pose some fire risk.

Aboveground tanks add more fire risks and have additional location, construction and/or containment requirements.

Waste Costs

Soil contamination from existing or removed underground tanks can create a very expensive waste cost.

Fuel spills can require cleanup and notification to the Department of Natural Resources.

Significant spills may require expensive remediation/cleanup.

Accidents do happen, but prevention requires some attention.

Property Liability

Contaminated soils may result in significant property liability.

Property liability can seriously devalue the farm.

Waiting until retirement may eliminate eligibility for state assistance in cleanup costs.

Lender Requirements

Lenders are reluctantto make loans to prospective buyers if the property hasn't been documented as being free of contamination, or actually has been contaminated.

Farm improvement loans may be withheld by banks that do not want at-risk property as collateral.

Insurance Requirements

Insurance companies may have specific requirements of fuel storage systems before providing a farm policy.

Existing policies may be subject to higher rates for high risk installations.

Some companies in turn give a premium reduction for tanks that meet state codes.

Good fuel storage practices are just part of the overall risk reduction opportunities for farm families.

Address for this site: http://www.wisc.edu/farmasyst/private/petro/tip1.htm
Created by: Richard Castelnuovo, rcasteln@students.wisc.edu
Last modified: February 10, 1997