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Buying a gas station: 3 environmental roadblocks (and how to remove them!)

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Gas stations can make for a sound investment for someone interested in running a small business, but it’s also one of the most complicated sectors to navigate, not least because of the myriad environmental considerations. 

Making a gas station compliant to national and state regulations can be an expensive process, so to make sure you don't get stung, here's a brief overview of what to look for before you buy a gas station.

Key environmental issues

Leakage: either from the underground storage tank (UST) or from the lines running from the tank to the pumps.

Spillage: can occur from tankers filling the underground tanks or a customer overfilling the tank of their vehicle.

Migration: when fuel leaks from another facility on to the property. 

Buyer beware

Once the purchase is complete, the new owner assumes all responsibility.

It’s especially important to be aware of any environmental conditions that may exist before you buy a gas station, as it can be hard to prove that the issue(s) existed prior to the purchase.  

One of your first steps in buying a gas station should be to have an extensive environmental survey conducted. This assessment should evaluate the environmental history of the gas station property and if needed, include a sampling and study of the underground property.

Additional services offered at the same site (such as a car wash or auto repair shop) could also be the source of environmental issues, so be sure to consider them in the survey. 

Investigate if there is any lingering environmental litigation that the current owner may have been involved with. Depending on the structure of the sale, the new owner could be on the hook as well. Contact your state’s Department of Environmental Protection to find out if the site has an open file. 

Safe Storage

Each state has its own laws, but nearly all have adopted a mandatory double-lined tank policy in order to prevent leakage. Out-of-compliance stations can be subject to daily fines in the tens of thousands of dollars. 

If double-lined tanks (as well as leak detection sensors) are not already present at the site you are considering buying, it can be an expensive upgrade. 

Costs can run into several hundreds of thousands of dollars, in addition to the loss of business during construction, which can take between one to two months to complete. 

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