Legislative panel hears bill to let petroleum cleanup fund pay for prevention inspections

Senate Bill 315, which would allow additional preventive uses of the petroleum tank release cleanup fund, received a hearing before the Montana House Appropriations Committee on Feb. 3, 2025.

The bill’s sponsor, Senator John Esp, Senate District 29, told the committee the measure would add uses for Petro Fund dollars to pay for preventive measures and to “incent those inspections and sent compliance inspections” so releases can be caught earlier and costs avoided later. He said the change reallocates existing fund dollars rather than adding new revenue.

The bill drew support from industry and state officials. Brad Longcake, representing the Petroleum Marketers and Convenience Store Association, said his members operate the tanks and support the proposal as “an ounce of prevention is worth a pound of cure,” and emphasized that the bill does not create new revenue but reuses money already in the Petro Fund. Amy Steinmetz, the Department of Environmental Quality’s waste management and remediation division administrator, told the committee DEQ supports the bill because preventing releases is both cheaper and more protective of the environment than cleaning up releases after they occur.

Terry Wadsworth, executive director of the Petroleum Tank Release Compensation Board, which manages the Petro Fund, testified as an informational witness and answered committee questions about the fund’s balance and management. Wadsworth said the number of releases has declined and the fund has accumulated additional cash; he gave a rough description of the fund’s history, saying the fund was created in 1989 and is paid by a three-quarters of a cent per gallon levy that he described as roughly 10¢ per tankful, which brings in about $7 million a year. He told lawmakers the board does not expect the proposed $874,000 annual reallocation to cause a significant problem for cleanup activities and that the board would incorporate the prevention expenditures in its regular management if the change is approved.

Committee members asked for additional details. Representative Walsh pressed for hard numbers about the fund balance; Wadsworth said the fund fluctuates but at the moment had roughly $7.8 million available. Representative Mercer asked whether the department and the Petro Board report to the legislature; Steinmetz said both entities report to the interim budget committee on progress toward closure and other program activities. Mercer also sought clarification about petroleum brownfields versus the state program; Wadsworth described that federal petroleum brownfields funding is generally used for investigation (not cleanup) and can sometimes be applied toward a local co-pay for Petro Fund cleanup assistance.

Representative Crow asked whether active facilities on tribal lands were included in the count; Wadsworth said he did not have an exact number but estimated tribal-based facilities likely represent a small percentage of the total (he offered a rough ballpark of 2–5 percent) and suggested DEQ’s underground storage tank database could provide exact figures.

After questions, Senator Esp closed the hearing and urged support. The committee later took executive action on the bill and moved a “do pass” recommendation by voice vote.

If enacted as written, the bill would not increase the total Petro Fund revenue; the fiscal note cited a potential annual reallocation of roughly $874,000 from the fund to prevention activities while preserving cleanup as the primary use of the fund.