Petroleum tank board reports fund shortfall risk, maintains fees pending rising claims costs

Jonathan Manival, assistant director of the Petroleum Underground Storage Tank Release Compensation Board, told the House Natural Resources Committee about the board’s financial assurance fund, current balances, and a recent board decision to hold fees steady.

Manival said the Petroleum Board and its financial assurance fund were created by legislation enacted in 1989 to respond to federal requirements for underground storage tank (UST) owners. "All petroleum underground storage tank owners and operators are required to demonstrate $1,000,000 of financial responsibility to pay for potential damages caused by releases from their tanks," he said, and noted the fund provides coverage, under U.S. EPA approval, to approximately 3,100 owners of 20,700 USTs across the state.

Manival gave the fund’s current financial snapshot: "As of 01/31/2025, the fund's unobligated balance was $20,490,000. An additional $4,690,000 is obligated for the payment of claims through the end of fiscal year 2025. This total of $25,180,000 compares against an estimated liability of $39,000,000 for claim reimbursements ... as of 06/30/2024," he said.

Manival said the board reported that, at its Nov. 20, 2024 meeting, members voted to maintain current fee and deductible structures for the upcoming FY2026 year. He said the board set per-tank fees to remain at $350 and $550 per tank and indicated those fees align with the board’s existing deductible tiers; the witness did not provide an unambiguous transcript of the exact deductible-dollar pairings during testimony, and the committee record did not include a detailed fee schedule.

Manival warned that higher labor and materials costs from recent inflation are only beginning to show up in claims, and that rising claim costs could force higher reimbursements and lead to an increase in the annual per-tank fee in fiscal year 2027. He said the fund’s assets come from the per-tank fees, proceeds from revenue bonds if issued, and interest income, and that monies are used solely to pay claims, debt service on revenue bonds, and administration. He added that since the fund’s inception roughly $311 million has been disbursed for corrective action and third-party damages.

Manival described the board’s operations and appeals process, noting owners may appeal eligibility and reimbursement decisions under Chapter 119 of the Ohio Revised Code. The budget testimony he presented was for personnel costs only; he said no General Revenue Fund dollars are part of this request. Manival concluded by offering to answer committee questions.

No committee vote on the board’s personnel budget was recorded during the hearing.