Committee hears bill to double dry-cleaning surcharge, raise deductible and broaden enforcement

The Senate Committee on Agriculture and Natural Resources heard testimony on Senate Bill 184, which would amend the Kansas Dry Cleaner Environmental Response Act to raise the environmental surcharge, raise the corrective-action deductible and expand enforcement tools for the Kansas Department of Health and Environment (KDHE).

KDHE Deputy Director of Environment Kate Gleason told the committee the bill is intended to stabilize a shrinking revenue stream for the dry-cleaner trust fund. "The environmental surcharge is a 25¢ on every $10 tax that consumers pay. We are proposing to increase that to 50¢ per $10," Gleason said. She also said, "we are proposing to increase [the deductible] to $10,000, which is a great deal for the industry ... because it buys you $5,000,000 of liability protection here because we will then take the cost of cleanup up to $5,000,000." The bill would leave the solvent fee and the $100-per-year facility registration fee unchanged, according to KDHE.

The measure would also make certain failures—such as not registering with KDHE or failing to remit fees—unlawful and subject them to penalties. As presented by the reviser, the bill would allow the KDHE secretary or the director of the Bureau of Environmental Remediation to impose a penalty of up to $10,000 per violation; in the case of a continuing violation each month would constitute a separate violation. The bill is written to take effect July 1 following publication in the statute book.

Why it matters: KDHE staff and the reviser said the trust fund pays investigation and cleanup costs at contaminated dry-cleaning sites, many of which stem from historical solvent-handling practices. KDHE described a long tail of older releases that migrate in groundwater and can be expensive and slow to remediate. Committee members pressed KDHE on whether the proposed changes are limited to revenue adjustments or represent broader policy shifts affecting small businesses and enforcement.

Details and committee concerns

KDHE said the trust fund has multiple income streams—environmental surcharge, solvent-distributor fees, annual registration fees and deductibles collected when a property owner applies for coverage—and that declining revenues prompted the proposal. The reviser summarized the bill's substantive changes as (1) doubling the environmental surcharge (described in testimony as moving from 25¢ per $10 to 50¢ per $10), (2) increasing the corrective-action deductible from $5,000 to $10,000, (3) expanding what constitutes an unlawful act under the statute and (4) authorizing stronger enforcement and penalty authority for KDHE.

Senators pressed KDHE staff on several items: whether the penalty increase from $500 (the prior cap in the dry-cleaning law) to up to $10,000 is justified; whether the statutory criteria KDHE has used to evaluate enforcement would be removed; whether the bill eliminates a written-corrective-action-plan requirement or otherwise alters how corrective-action costs are approved; and whether giving KDHE authority to collect delinquent taxes duplicates functions of the Department of Revenue. KDHE acknowledged some drafting questions and agreed to provide follow-up materials.

On penalties and enforcement: Senator Titus highlighted that the bill replaces a $500 cap in the dry-cleaning statute with the hazardous-waste penalty framework and asked why that change was necessary. Gleason said the department views dry-cleaning releases as hazardous-waste issues and that higher penalties are intended to deter mishandling and to align dry-cleaning enforcement with other hazardous-waste generators.

On revenue collection: KDHE told senators it had discussed concurrent collection with the Department of Revenue. The bill would allow KDHE to obtain delinquent-tax reports from Revenue and, if needed, issue orders requiring payment for taxes, interest and penalties specifically arising under the dry-cleaning law; KDHE said the language can be tightened to make that limit explicit.

On cleanup scope and program performance: KDHE Deputy Secretary and Director Leo Henning described how historical practices—pouring solvent-laden rinse water outside or allowing filters to drip—led to contamination that can form long groundwater plumes. He said many contaminated sites are older, often discovered when investigations for other contamination intersect the plume or when public water supplies or private wells are at risk. KDHE told the committee it has closed 18 dry-cleaning sites since 1995 but continues to manage a larger number of active sites that require long-term work; the agency said additional funding would allow it to address sites more quickly.

The committee also discussed programmatic changes in the bill that would: move the deductible payment to the day an owner applies for trust-fund coverage (so the department receives the deductible up front), remove language that limited proactive investigation of potential dry-cleaning sites, and adjust collection and enforcement procedures tied to registration and fee remittance.

Requests for follow-up

Senators asked for additional information before they would consider a final vote: a list of civil penalties and amounts KDHE has issued in the last five years, clearer drafting on collection authority, and an explanation of why specific cleanup-related language was changed. KDHE agreed to provide those materials to the committee assistant and staff.

Outcome and next steps

No committee vote on Senate Bill 184 was taken during the hearing. Chairman Peck invited members to submit amendment language and said the bill would need further drafting and clarification before the committee would act.