I come to you all for guidance and advice on a property that I am currently under contract for. The property is a two family near Journal Square Jersey City NJ. During the oil sweep testing we were made aware of a 550 gallon tank in front of the property under cement. According the the city the tank has been foam filled back in 2002. The seller is not willing to remove tank and is asking to take it as is. Am I taking too much risk by taking it with the tank? What is the likely hood of it being contaminated if it has already been decommissioned? I am fine with removing the tank once we close, I am afraid of being responsible for remediation costs to remove contamination if any. Please share your thoughts.
Attorney · NJ · Member since 2016 · 1k+ posts · 794 votes
6y
You can test the soil around it to make sure there is no contamination, but sometimes stirring the land when you remove can cause contamination, so that's a risk. If it was properly decommissioned with permits and inspections, leaving it there is also an option.
Investor · Tampa, FL · Member since 2013 · 2k+ posts · 1k+ votes
6y
Soil testing will be quite a challenge since the tank is below concrete. It's highly advisable that you do the soil test, but be aware that the cost associate with doing it will include concrete removal and putting down new concrete. Could be in the thousand dollar range for getting it done, or above. The seller may not want you to do this. I would never purchase a property without knowing full well what the situation is with an UST.
Real Estate Consultant · Bloomfield, NJ · Member since 2010 · 2k+ posts · 1k+ votes
6y
@Dror Refaeli
Based on my experience I say get the tank removed. We had a situation in Kenilworth where a tank was decommissioned in the late 90s with the proper paperwork, permit ETC. The seller swore that everything was legit and we did not need to do anything further in regards to the decommissioned tank. However our investors insisted on removing the tank before closing. The seller agreed that we will pay for the cost of removal. However if there was any contamination, he would be responsible for it. Sure enough when we removed the tank, there was contamination. It was about $9,000 worth of clean up that had to be done before we closed. So I say offer to pay for the tank removal yourself BEFOFE you close. But if there's any contamination, the seller will pay for it.
Rental Property Investor · Long Island, NY · Member since 2015 · 490 posts · 301 votes
6y
@Dror Refaeli Definitely get it tested and removed. There are companies who if their tests come back clean will guarantee the price for removal so that should cap your exposure. I just did this on a property in JC a few months back and am glad I did.
Alpha, NJ · Member since 2019 · 35 posts · 15 votes
6y
I’d be very cautious. I had a decommissioned oil tank when I bought my property, there was no true standard to decommissioning an oil tank, sometimes they filled them with sand etc, there could still be oil in the tank... too risky with the EPA, that’s one leap of faith I stay away from
Rental Property Investor · Jersey City, NJ · Member since 2018 · 176 posts · 80 votes
6y
When we were doing an oil tank sweep on the last property we acquired the company we used offered to do a drill and probe which wouldn’t disturb the cement too much. It was an additional $250.