Ihab Salloum[ad_1]
Interpretation, next step planning, prevention & retaining the customer
Fuel oil dealers have always had to adapt to changing market forces, whether it was competing with COD discounters or gas companies. Now, the looming issue of underground tanks is something we must address. Will we simply react as we have in the past, or will we take proactive measures to prevent any threats?
In New York and New Jersey, The Homeowner’s Environmental Loss Protection Program has proven to be a valuable tool in combating gas conversions. However, more tools are needed, especially in dealing with the uncontrollable loss of accounts during property transactions.
As the vice president and founder of Annis Fuel Oil Service (AFOS), I recognized the potential in underground oil tanks in the early 1980s. With the New Jersey Hazardous Substance Storage Act and amendments to the Spill Act, tank work started to overlap with environmental science. My background in college chemistry came in handy. Although I later founded ANCO Environmental, I remained dedicated to the oil industry. As a small oil dealer, I understand the threat that UST hysteria poses. Instead of denying or downplaying the issue, we must acknowledge and address it. Our customers’ financial interests are at stake, and they are looking to us for leadership. We must tackle the public relations damage caused by leaking underground tanks, educate ourselves on selecting appropriate tank tests, identify the true adversary behind the oil tank problem, and find effective solutions. By doing so, we can prevent the loss of oil heat customers during real estate transactions.
Since my companies primarily operate in New Jersey, I often refer to the regulations set by the New Jersey Department of Environmental Protection (NJDEP). However, similar regulations may exist in other states, so be sure to check with your state’s Environmental Protection Department for specific guidelines.
The gas companies have been spreading misinformation, suggesting that oil heat is the cause of underground pollution. However, our observations indicate the opposite. There are statistically more remediation projects involving abandoned or improperly closed tanks than active tanks. Homeowner insurance policies typically deny UST pollution claims, leaving those who converted to gas heat with a greater burden. Despite this, it is the oil industry that takes the brunt of the negative fallout. To win the public relations game, we must shift the focus from “oil heat” to “underground tanks” and take a proactive stance.
The most vulnerable point for a fuel oil account is during a property transaction. Tank testing and site certification are becoming more common as a result of liability concerns and the “due diligence” audit requirement for innocent purchasers. Buyer’s attorneys now secure the right to test around an oil tank. Due to public misconceptions, this mechanism will continue to pose challenges for oil heat in the future.
Many people attribute the tank problem to lawyers, gas companies, gas heating contractors, Realtors, or tank removal companies. However, the true silent adversary is corrosion. Factors such as low pH soils and high water tables contribute to a high ion exchange rate with the tank, leading to corrosion. Poor construction practices further accelerate this process. Understanding this underlying force is crucial.
Environmental regulations trace back to the 1977 Federal Clean Water Act, which initially focused on industrial polluters. In 1984, with the passage of the New Jersey Environmental Cleanup Responsibility Act (ECRA), the presence of an UST became a headache for industrial property owners. This laid the foundation for today’s UST problem. Stricter industrial regulations gradually made their way into residential situations.
In June of 1993, ECRA was amended and renamed ISRA (Industrial Site Recovery Act), bringing about many positive changes and even introducing a spill fund. However, a companion change to the Spill Compensation and Control Act (Spill Act) went largely unnoticed. This amendment made future owners of polluted property liable for contamination they did not cause. The potentially devastating language of this amendment places the responsibility on buyers for any hazardous substance discharge unless they can satisfy certain criteria. This concept of an “innocent purchaser” has become the cornerstone of property transactions. Tank testing, particularly soil testing, is essential to demonstrate that a new owner had no knowledge of or involvement in any discharge.
When choosing a tank test, several factors must be considered, such as tank status, site conditions, and overall objectives. Accuracy, verifiability, speed, and cost are additional considerations. There are three major categories of tank tests: liquid, air, and soil tests. Each has its limitations and potential for false results.
In conclusion, it is crucial for fuel oil dealers to adapt to changes and address the issue of underground tanks. By deflecting public relations damage, selecting appropriate tank tests, understanding the true causes of tank problems, and finding solutions, we can ensure the retention of our oil heat customers during real estate transactions.
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