2007 California Health and Safety Code Chapter 6.76. Loans For Replacing, Removing, Or Upgrading Underground Storage Tanks

CA Codes (hsc:25299.100-25299.117)

25299.100.  For purposes of this chapter, the following definitions
apply:
   (a) "Board" means the State Water Resources Control Board.
   (b) "Loan applicant" means a small business that applies to the
board for a loan pursuant to this chapter.
   (c) "Grant applicant" means a small business that applies to the
board for a grant pursuant to this chapter.
   (d) "Tank" means an underground storage tank, as defined in
Section 25281, used for the purpose of storing petroleum, as defined
in Section 25299.22.  "Tank" also includes under-dispenser
containment systems, spill containment systems, enhanced monitoring
and control systems, and vapor recovery systems and dispensers
connected to the underground piping and the underground storage tank.

   (e) "Project tank" means one or more tanks that would be upgraded,
replaced, or removed with loan or grant funds.



25299.101.  (a) The board shall conduct a loan program pursuant to
this chapter, to assist small businesses in upgrading, replacing, or
removing tanks to meet applicable local, state, or federal standards.
  Loan funds may also be used for corrective actions, as defined in
Section 25299.14.
   (b) The board shall also conduct a grant program, pursuant to this
chapter, to assist small businesses to comply with Sections 25284.1
and 25292.4.


25299.102.  The board shall only make loan funds available to loan
applicants that meet all of the following eligibility requirements:
   (a) The loan applicant is a small business, either as defined in
Section 632 of Title 15 of the United States Code, and in the federal
regulations adopted to implement that section, as specified in Part
121 (commencing with Section 121.1011) of Chapter 1 of Title 13 of
the Code of Federal Regulations, or employs fewer than 500 full-time
and part-time employees, is independently owned and operated, and is
not dominant in its field of operation.  In either case, the
principal office of the small business shall be domiciled in the
state, and the officers of the small business shall be domiciled in
this state.  The board shall give priority to awarding loans to small
businesses that meet the definition of small business specified in
subdivision (d) of Section 14837 of the Government Code.
   (b) The loan applicant owns or operates a project tank.
   (c) Loan funds are not obtainable, upon reasonable terms, from
private financial institutions, the California Pollution Control
Financing Authority, or any other government board.
   (d) The loan applicant demonstrates the ability to repay the loan,
and the availability of adequate collateral to secure the loan.
   (e) All tanks owned and operated by the loan applicant are subject
to compliance with Chapter 6.7 (commencing with Section 25280), and
the regulations adopted pursuant to that chapter.
   (f) The loan applicant has complied, or will comply, with the
financial responsibility requirements specified in Section 25299.31
and the regulations adopted pursuant to this section.



25299.103.  (a) A complete loan application shall include all of the
following:
   (1) Evidence of eligibility.
   (2) An environmental audit, as specified in Section 5268 of Title
10 of the California Code of Regulations.
   (3) Financial and legal documents necessary to demonstrate the
applicant's ability to repay and provide collateral for the loan.
The department shall develop a standard list of documents required of
all applicants, and may also request from individual applicants
additional financial and legal documents not provided on this list.
   (4) An explanation of the reasons why the project tank is not in
compliance with applicable local, state, or federal standards, and
evidence that tanks not included in the list of project tanks are
currently in compliance with applicable local, state, or federal
standards.
   (5) A detailed cost estimate of the tasks which are required to be
completed in order for the project tanks to comply with applicable
local, state, or federal standards.
   (6) Any other information that the department determines to be
necessary to include in an application form.
   (b) Notwithstanding paragraph (4) of subdivision (a), the
department may not refuse to grant a loan to an applicant solely
because the applicant has failed to obtain a permit pursuant to the
requirements of Chapter 6.7 (commencing with Section 25280).



25299.104.  (a) The minimum amount that the board may loan an
applicant is ten thousand dollars (,000), and the maximum amount
that the board may loan an applicant is seven hundred fifty thousand
dollars (0,000).
   (b) The term of the loan shall be for a maximum of 20 years if
secured by real property, and for 10 years if not secured by real
property.  The interest rate for loans shall be set at the rate
earned by the Surplus Money Investment Fund at the time of the loan
commitment.
   (c) Loan funds may be used to finance up to 100 percent of the
costs necessary to upgrade, remove, or replace project tanks,
including corrective actions, to meet applicable local, state, or
federal standards, including, but not limited to, any design,
construction, monitoring, operation, or maintenance requirements
adopted pursuant to Sections 25284.1 and 25292.4.
   (d) The repeal of this chapter pursuant to Section 25299.117 shall
not extinguish a loan obligation and shall not impair the deed of
trust or other collateral made pursuant to this chapter or the
authority of the state to pursue appropriate action for collection.
   (e) The board may charge a loan fee to loan applicants of up to 2
percent of the requested loan amount.  The loan fee shall be
deposited in the Petroleum Financing Collection Account.



25299.105.  (a) The board shall make grant funds available from the
Petroleum Underground Storage Tank Financing Account to eligible
grant applicants who meet all of the following eligibility
requirements:
   (1) The grant applicant is a small business, pursuant to the
following requirements:
   (A) The grant applicant meets the conditions for a small business
concern as defined in Section 632 of Title 15 of the United States
Code, and in the federal regulations adopted to implement that
section, as specified in Part 121 (commencing with Section 121.101)
of Chapter I of Title 13 of the Code of Federal Regulations.
   (B) The grant applicant employs fewer than 20 full-time and
part-time employees, is independently owned and operated, and is not
dominant in its field of operation.
   (2) The principal office of the grant applicant is domiciled in
the state, and the officers of the grant applicant are domiciled in
this state.
   (3) The grant applicant, the applicant's family, or an affiliated
entity, has owned or operated the project tank since January 1, 1997.

   (4) All tanks owned and operated by the grant applicant are
subject to compliance with Chapter 6.7 (commencing with Section
25280), and the regulations adopted pursuant to that chapter.
   (5) The facility where the project tank is located has sold at
retail less than 900,000 gallons of gasoline annually for each of the
two years preceding the submission of the grant application.  The
number of gallons sold shall be based upon taxable sales figures
provided to the State Board of Equalization for that facility.
   (6) The grant applicant owns or operates a tank that is in
compliance with Section 25290.1, 25290.2, or 25291, or subdivisions
(d) and (e) of Section 25292, and the regulations adopted to
implement those sections.
   (7) The facility where the project tank is located was legally in
business retailing gasoline after January 1, 1999.
   (b) Grant funds may only be used to pay the costs necessary to
comply with the requirements of Section 25284.1, 25292.4, or 25292.5.

   (c) If the total amount of grant requests by eligible grant
applicants to the board pursuant to this section  exceeds, or is
anticipated to exceed, the amount in the Petroleum Underground
Storage Tank Financing Account, the board may adopt a priority
ranking list to award grants based upon the level of demonstrated
financial hardship of the eligible grant applicant, or the relative
impact upon the local community where the project tank is located if
the claim is denied.



25299.106.  A complete grant application shall include all of the
following information:
   (a) Evidence of eligibility.
   (b) Financial and legal documents necessary to demonstrate the
applicant's financial hardship, if any.  The board shall develop a
standard list of documents required of all applicants, and may also
request from individual applicants additional financial and legal
documents not provided on this list.
   (c) An explanation of the actions the applicant is required to
take to comply with the requirements of Sections 25284.1 and 25292.4.

   (d) A detailed cost estimate of the actions that are required to
be completed for the project tanks to comply with applicable local,
state, or federal standards.
   (e) Any other information that the department determines to be
necessary to include in an application form.



25299.107.  (a) The minimum amount that the board may grant an
applicant is three thousand dollars (,000), and the maximum amount
that the board may grant an applicant is fifty thousand dollars
(,000).
   (b) Grant funds may be used to finance up to 100 percent of the
costs necessary to comply with Sections 25284.1, 25292.4, and
25292.5.  No person or entity is eligible to receive more than fifty
thousand dollars (,000) in grant funds pursuant to this chapter.



25299.108.  The board shall adopt regulations necessary to implement
and make specific this chapter as emergency regulations in
accordance with Chapter 3.5 (commencing with Section 11340) of Part 1
of Division 3 of the Government Code, and for purposes of that
chapter, including Section 11349.6, the adoption of the regulations
shall be considered by the Office of Administrative Law to be
necessary for the immediate preservation of the public peace, health
and safety, and general welfare.  Notwithstanding subdivision (e) of
Section 11346.1 of the Government Code, the regulations shall be
repealed 180 days after their effective date unless the board
complies with Chapter 3.5 (commencing with Section 11340) of Part 1
of Division 3 pursuant to subdivision (e) of Section 11346.1 of the
Government Code.



25299.109.  (a) The Petroleum Underground Storage Tank Financing
Account is hereby created in the State Treasury.  The Petroleum
Underground Storage Tank Financing Account is created for both of the
following purposes:
   (1) Receiving federal, state, and local money.
   (2) Receiving repayments of loans and interest and late fees on
those accounts.
   (b) Upon appropriation by the Legislature, funds in the account
shall be used by the board only to make loans and grants pursuant to
this chapter.
   (c) The board shall annually make available not more than 33
percent of the available funds from the account for the purposes of
providing grants pursuant to this chapter.
   (d) Notwithstanding Section 16305.7 of the Government Code, all
interest or other increments resulting from the investment of the
funds in the Petroleum Underground Storage Tank Financing Account
pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of
Part 2 of Division 4 of Title 2 of the Government Code shall be
deposited in a subaccount of the Petroleum Underground Storage Tank
Financing Account, and expended only pursuant to Section 25299.113.



25299.110.  (a) There is hereby created, in the California Economic
Development Grant and Loan Fund, the Petroleum Financing Collection
Account.  The Petroleum Financing Collection Account is created
solely for the purpose of receiving charges, fees, and income,
including, but not limited to, the charges and costs collected
pursuant to subdivision (c).
   (b) To defray the costs of the board in administrating the loan
program created pursuant to this chapter, the board may do all of the
following:
   (1) Impose reasonable charges on all applications and impose the
loan fee specified in subdivision (e) of Section 25299.104.
   (2) Recover collection costs from the borrower or other party.
   (3) Earn income on any asset recovered pursuant to a loan default.

   (c) The board shall deposit the charges and costs collected
pursuant to subdivision (b), including the loan fees charged pursuant
to subdivision (e) of Section 25299.104, in the Petroleum Financing
Collection Account.  Notwithstanding Section 13340 of the Government
Code, all money deposited in the Petroleum Financing Collection
Account shall be continuously appropriated to the board for those
costs necessary to protect the state's position as a lender-creditor.
  These costs shall be broadly construed to include, but not be
limited to, foreclosure expenses, auction fees, title searches,
appraisals, real estate brokerage fees, attorney fees, mortgage
payments, insurance payments, utility costs, repair costs, removal
and storage costs for repossessed equipment and inventory, and
additional expenditures to purchase a senior lien in foreclosure or
bankruptcy proceedings.


25299.111.  If this chapter is repealed pursuant to Section
25299.117, then following the day on which the authority ceases to
exist, all moneys in the Petroleum Underground Storage Tank Financing
Account and all moneys due that account shall revert to, and accrue
to the benefit of, the Underground Storage Tank Cleanup Fund in the
State Treasury.



25299.112.  On or before January 1 of each year, the board shall
submit a report to the Legislature concerning the performance of the
grant and loan program established by this chapter, including the
number and size of grants and loans made, characteristics of grant
and loan recipients, the number of underground storage tanks removed
and upgraded as a result of the grant and loan program, and the
amount of money spent on administering the program.  Copies of the
report shall be submitted to the appropriate fiscal and policy
committees of the Legislature and, upon request, to individual
Members of the Legislature.


25299.113.  (a) The board may, upon appropriation by the Legislature
in the annual Budget Act, expend the funds in the subaccount
established in the Petroleum Underground Storage Tank Financing
Account in subdivision (d) of Section 25299.109 for the
administrative expenses in carrying out this chapter.
   (b) Commencing on the effective date of this chapter, the
Controller shall do all of the following:
   (1) Transfer the interest payments from loan applicants and
interest earned on the funds in the Petroleum Underground Storage
Tank Financing Account received from July 1, 2002, to the effective
date of this chapter, inclusive, into the subaccount established in
subdivision (d) of Section 25299.109.
   (2) Direct to the Petroleum Underground Storage Tank Financing
Account repayments of principal of loans issued pursuant to former
Chapter 8.5 (commencing with Section 15399.10) of Part 6.7 of
Division 3 of Title 2 of the Government Code, as that chapter existed
on December 31, 2003.
   (3) Direct to the subaccount established in subdivision (d) of
Section 25299.109, the payment of interest on loans issued pursuant
to former Chapter 8.5 (commencing with Section 15399.10) of Part 6.7
of Division 3 of Title 2 of the Government Code, as that chapter
existed on December 31, 2003.
   (c) For the 2004-05 fiscal year, using funds available in the
subaccount established in subdivision (d) of Section 25299.109, the
Department of Finance may augment the board's budget for the
reasonable amount necessary to implement this chapter and may
administratively establish necessary positions.  Pursuant to
subdivision (a), the board shall request the continuation of the
necessary positions and funding for the 2005-06 fiscal year, and
succeeding years, through the annual Budget Act.



25299.114.  All persons serving in an exempt position engaged in the
performance of a function described in former Chapter 8.5
(commencing with Section 15399.10) of Part 6.7 of Division 3 of Title
2 of the Government Code as repealed by Chapter 229 of the Statutes
of 2003 or the administration of the program described in that
chapter shall be transferred to the board subject to approval by the
Department of Finance.  This transfer shall not affect the status,
positions, and rights of these persons.  Section 19050.9 of the
Government Code shall apply to the transfer of persons serving in
state civil service who are engaged in the performance of a function
or the administration of that chapter.



25299.115.  The repeal of former Chapter 8.5 (commencing with
Section 15399.10) of Part 6.7 of Division 3 of Title 2 of the
Government Code by Chapter 229 of the Statutes of 2003 shall not be
construed to terminate any obligation to pay claims filed, repay
loans outstanding, or resolve any cost recovery action filed on or
before January 1, 2004.



25299.116.  A recipient of a grant that was awarded pursuant to
former Chapter 8.5 (commencing with Section 15399.10) of Part 6.7 of
Division 3 of Title 2 of the Government Code, as that chapter existed
on December 31, 2003, and that expired after December 31, 2003, may
receive grant funds from the Petroleum Underground Storage Tank
Financing Account consistent with the terms of the grant, for one
year following enactment of this chapter, notwithstanding expiration
of the grant.



25299.117.  This chapter is repealed as of January 1, 2011, unless a
later enacted statute that is enacted on or before January 1, 2011,
deletes or extends that date.