Report suggests raising fuel tax for underground tank cleanup

The General Assembly's Program Evaluation Division recommended raising the state fuel tax to help pay for an accelerated clean-up program and requiring new tank owners to get private insurance coverage to help pay for future clean-up efforts.

"We're sensitive to the state's current fiscal climate, but (raising taxes) was the only way, short of taking the brakes off that we put on the program in 2004, to adjust the backlog," said Sean Hamel, an evaluator with the Program Evaluation Division.

The underground tank program began in 1985 in response to a federal mandate and concerns that petroleum was entering groundwater from old gas stations. The state created a trust fund to pay for much of the cleanup.

The state has removed 16,172 commercial and non-commercial tanks in the last 21 years, according to the report presented to lawmakers Monday. But removing the 8,610 tanks that remain will cost the state $549 million, the report said.

"There's more work out there than the state can pay for," said Grover Nicholson, chief of the Underground Storage Tank section in the state Division of Waste Management.

North Carolina has about three underground tanks per 1,000 residents, ranking the state ninth in the U.S. The majority of those tanks are located in Wake, Guilford and Mecklenburg counties.

Lawmakers expressed skepticism toward the recommendation for high fuel taxes.

"I don't see it happening in the short session. I just don't see that taking place," said Rep. Nelson Cole, D-Rockingham. "With the economy the way it is, ... now is not the time to be doing anything like that."