Marty Millner

I represented a seller on a house that closed in Lower Makefield Township, recently, that was heated with oil, and had a tank burried in the ground. 

 

I advised the seller, over a year ago, to have the tank removed, prior to listing the house.  

 

If you are not familiar with the possible complications of having an oil tank in the ground, you probably wonder why I would suggest that.  The answer is that if oil gets into the ground, it creates a potentially very difficult and expensive, enviornmental issue.

 

I preferred that the seller deal with the tank, on their own terms, and without the pressure of trying to meet a buyers demands.  

 

So, we received an offer on the house, and as part of the home inspection, the buyer included a soil sample to determine whether there was any indication that there was any oil had escaped into the ground.  This is the test that is most often used, to determine whether there are issues, and whether further remediation is necessary, once the tank is taken out of the ground.  Years ago, there was a pressure test that was used, but that test posed some risk that the test itself, could compromise the tank. 

 

In my seller’s case, unfortunately the soil test did indicate that some oil had found its way into the ground.  My experience with the basic soil test, is that the test very often does indicate that some oil residue is in the soil.  Sometimes, that can happen just from filling the tank. 

 

The problem is, that once there is an indication that there is oil in the ground, there is really no way to know exactly what it is going to cost to remove the tank, and do remediation.  Thus the challenge for the seller, which is to meet the demands of a nervous, and concerned buyer.

 

In our case, we needed to get estimates from companies, for the cost of the tank removal, soil remediation and installation of an above ground tank.  As I said before, without actually removing the tank, and doing further soil testing, there really isnt any way to know with absolute certainty, what the total cost will be.  As a result, we had to establish an escrow, which was actually considerably more than what we expect the cost to be, so that the buyer would be comfortable with moving forward to closing. 

 

That takes me back to my original premise.  If you have an undergroud oil tank, and are going to sell your house, I highly recommend taking appropriate steps to remove the tank before you put the house on the market.  That way, you can remove it, and provide a prospective buyer with the appropriate documentation. 

 

If you do have an underground tank, and you are faced with cleanup, there is a grant program that is offerred by the Pennsylvania Department of Enviornmental Protection Bureau of Waste Management, to assist owners of underground heating oil tanks with the costs of environmental cleanup due to a release of oil.  There are some limits, which I will address in a minute, but basically the release must have occurred or been discovered, on or after January 30, 1998.

 

The program is basically a remibursement program.  The owner must pay the first 1,000 of eligible cleanup costs.  The DEP, will remiburse the remaining eligible cleanup costs up to a maximum of 4,000.

 

I have the instructions, and the form to submit, if you need to apply for funding under this provision. 

 

This particular transaction would have been much less stressful, and the seller would have left the closing with a lot more money, had the oil tank been removed last year. 

 

If you have other questions, or want additional information about removing underground oil tanks, please contact me.