The majority of the homes in Northern New Jersey towns such as Maplewood, South Orange and Millburn / Short Hills were built in the early 1900s, sometimes even late 1800s. One of the pitfalls of buying these extremely charming, older homes, as many homeowners and homebuyers have come to discover, are corroding or leaking underground oil tanks.
Dealing with a leaking oil tank can become a real headache. The good news is you can avoid it with a $250 application fee and some paper shuffling. Many are not aware of the New Jersey Tank Grant Program - a state program which gives homeowners up to $3,000 to remove a non-leaking underground tank and replace it with a modern, environmentally sound aboveground tank. The program is a result of a new state law that channels certain business tax receipts to environmental causes. Removing underground oil tanks – before they leak – falls into this category.
The life expectancy of buried tanks varies depending on the manufacturing materials used, how the tank was installed and the composition of the soil. According to local home inspectors, most tanks last for several decades without any problems, assuming good maintenance, of course. But like a roof or a driveway, an underground tank will eventually have to be replaced.
As a local Realtor with Coldwell Banker, I hear a lot about oil tanks. I’ve had several transactions where the issue of an underground tank has come up. In fact, I am dealing with one now. Buyers get very scared and nervous, especially first time buyers at the very mention of an old oil tank. Perhaps they’ve heard some horror story from a friend or logged on to local e-loops and seen the endless threads.
In my opinion, the time spent on the application and the $250 fee is time and money well spent if it can avoid losing a buyer to what they see as a big, scary, rusty, leaking tank when your house is up for sale. Nowadays, buyers are savvy and will often do a tank sweep (a roughly $300 test) during the inspection phase. If a tank is found, they will insist for you to remove the leaking tank and remediate the soil… this process can take months and can hold up the transaction or even kill it. Why take the risk? Take the steps in advance and replace it now – don’t sabotage yourself when you are in the middle of a real estate transaction. If you plan on staying in the house, you can always switch to natural gas down the road, but have the State of New jersey pay for this costly upgrade now while there is still money available in the Grant program.
If, in the process of removing your old tank, a leak is found, then the process for removing the tank becomes a bit more complicated. At this point, it will no longer be taken care of under the auspices of the Grant program – but will be covered by the New Jersey Department of Environmental Protection (unless you have tank insurance). Either way, it is still doable.
If you think your tank is old, you have two replacement options:
1) Replace with a fiberglass or new, corrosion-resistant underground tank. (unless there is no way around it, don't pick this option!)
2) Replace with an aboveground tank, which can be installed in the basement or outside and hidden in a special enclosure.
Removing and replacing a tank is the preferred option, but decommissioning the tank might occur when access is limited and excavation might lead to problems (i.e. when the tank is buried under an addition to a home’s original structure). To properly close and decommission an underground tank, a certified company must empty and clean the tank and then fill it with a substance such as sand.
Most importantly, all tank testing and removal must be done by a DEP certified contractor. Tank installation is NOT a do-it-yourself weekend project! You can find a list of DEP Certified UST Firms on the Underground Storage Tanks page of the NJDEP site.
Eligibility:
The vast majority of New Jersey residents are eligible. There are three main criteria for qualifying:
• You must have a federal taxable income of less than $250,000.
• Your net worth must be less than $500,000 (excluding your primary residence and pension)
• You spend more than 51% of your income on living expenses (this requires a one page worksheet to fill out)
Like all government grant programs, there is paperwork to be filled out and instructions to read. But everything on the www.NewTanksNJ.org site has been organized and streamlined. You can download all the forms on the site.
Get it done – especially if you live in Maplewood, South Orange or Millburn / Short Hills! Those savvy buyers don’t want to take any risks and you shouldn’t either.
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