City of Palo Alto Spends $300,000 To Remove Three

Leaking Oil Tanks (1989) At Palo Alto Airport (PAO)—

County Airport Operator Refuses To Pay For Cleanup.

Palo Alto Taxpayers Left With Bill.

The costs of running the Palo Alto Airport have been hard to track, due to failures
on the part of the Santa Clara County Airport Administration to actually keep
track of the expenditures made to the airport over the years, the fact that many of
the dollars spent on the Palo Alto Airport come from Federal sources—so have
been ignored by the County—and lastly, because the County refused to pay for
some environmental cleanup that stemmed from tanks installed at the airport
before the County because the airport operator. In this case, the City of Palo
Alto paid to have the tanks removed, but the airport operation was never charged
for the cost—leaving the taxpayer footing the bill for this mess.

The articles below, from the San Jose Mercury of 1989, outline the issue of oil
spills associated with buried fuel tanks on the airport property:
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P.A., COUNTY AT ODDS OVER SOIL CLEANUP
San Jose Mercury News (CA)
April 5, 1989
Author: LISA LAPIN, Mercury News Staff Writer

Three leaking fuel tanks recently removed from the Palo Alto Airport have left more of a mess
than just soil saturated with gallons of oil.

Palo Alto and Santa Clara County are embroiled in a dispute over who is going to pay to clean up
the soil -- a chore expected to cost more than $600,000. If the oil has reached underground water
supplies, the price tag could easily triple.

That's more cash than either the county or the city can spare, and the two may find themselves
going to court over exactly who was responsible for the tanks in the first place.

''We can't find any records showing how the tanks got there," City Manager Bill Zaner said.
"There's one thing for sure: Whoever put it there is long gone, and we're left to battle it out."

Palo Alto owns the airport land, but since the early 1960s has leased it to the county, which
manages the airport.

About three years ago, airport workers discovered the abandoned tanks, which had apparently
been used to store waste oil.

An expedient deal

In an effort to get the tanks out of the ground quickly, the city and county struck a deal: Palo Alto
paid $60,000 to remove the tanks. In turn, the county agreed to landscape some streets around
the airport and arrange for an airport noise study.

''We had figured, why go to court and spend a lot of money on lawyers?" Zaner said of his
agreement with John Maltbie, then assistant county executive.

But in late 1988, it became apparent that the problem was much worse than either Zaner or
Maltbie had imagined. Consultants hired by Palo Alto found "clear evidence that petroleum
hydrocarbons have spread significantly beyond the immediate tank site," according to a report to
the city council.

Last month, the council demanded that the city staff provide a full explanation of why the city,
rather than the county, should foot the bill.

Here come the lawyers

Zaner sent a letter to County Executive Sally Reed suggesting the county split the costs 50-50
with the city. The other option, he said, would be to "bring the attorneys back into the picture, and
I'm not too eager to see that happen."

The county says it can't pay even half.

Talks on the matter are expected to continue this week, although neither side is optimistic about
the outcome.

Zaner said both governments must resolve the situation soon, or possibly face fines from
monitoring agencies.

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OIL-IN-SOIL STUDY COST: $210,000 WHO PAYS FOR P.A. AIRPORT LEAK
DISPUTED
San Jose Mercury News (CA)
September 27, 1989
Author: LISA LAPIN, Mercury News Staff Writer

Palo Alto will spend $210,000 to figure out how to clean up soil saturated with gallons of oil from
three leaking fuel tanks at Palo Alto Airport.

The money, approved by the Palo Alto City Council on Monday, will pay for hiring a consultant to
design a cleanup program. It does not include costs for the actual removal of the contaminated
soil -- which could range from $400,000 to more than $1 million, depending on whether the
pollutants have leaked into groundwater.

Palo Alto and Santa Clara County are embroiled in a dispute over who should really pay for the
cleanup. Neither the city nor the county has ready cash to spare, and neither one is accepting
responsibility for the leak.

When asked for a ballpark estimate of how much the city could end up paying for the cleanup,
City Manager Bill Zaner said, "I don't want to hazard a guess."

Zaner said negotiations with the county have reached a stalemate. The issue may ultimately be
resolved either in court or by a private mediator, Zaner said.

The consultant hired Monday will also be asked to review city, county and state records and
aerial photographs to find out how long the tanks had been there.

The consultant also will interview airport personnel about operations and the history of fuel use at
the site in an effort to find out who built the tanks. Palo Alto owns the airport land, but since the
early 1960s has leased it to the county, which manages the airport.

About three years ago, airport workers discovered the abandoned tanks, which apparently had
been used to store waste oil. No one knew when the tanks were built nor how long they had been
used.

In an effort to get the tanks out of the ground quickly, the city and county struck a deal: Palo Alto
paid $70,000 to remove the tanks, and the county agreed to landscape some streets around the
airport and arrange for an airport noise study.

But late last year, it became apparent that the problem was much worse than anyone had
imagined. Consultants hired by Palo Alto found "clear evidence that petroleum hydrocarbons
have spread significantly beyond the immediate tank site," according to a report to the city
council.

The report recommended further testing of the groundwater at the site and of soil under a nearby
parking lot and airplane hangar.

Zaner sent a letter to County Executive Sally Reed suggesting the county split the costs 50-50
with the city. Reed replied that the county was not responsible and did not have the money.

Now, it will be up to the consultants to prove who's responsible.

In the meantime, studies of the leaking tanks will have cost Palo Alto nearly $300,000 from its
capital improvement funds.

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P.A. BLAMES TOXIC SPILL ON OIL FIRM 3 AIRPORT FUEL TANKS
INSTALLED 30 YEARS AGO
San Jose Mercury News (CA)
December 26, 1989
Author: LISA LAPIN, Mercury News Staff Writer

Unable to settle their dispute over who should clean up toxic soil contamination at the Palo Alto
Airport, the city of Palo Alto and Santa Clara County appear to have found a new strategy: Blame
someone else.

In this case, it's a major, and so far, unnamed oil company. Recently discovered city records
indicate that the company installed the tanks more than 30 years ago.
"Everybody sat up and said, 'Oh my goodness! Maybe we're not responsible after all,' " said Palo
Alto City Manager Bill Zaner of the find.

For more than a year, the two governments have haggled over who is responsible for the soil
saturated with oil from three leaking fuel tanks at the county-run airport.

Palo Alto has spent nearly $300,000 to remove the tanks and to hire a consultant to design a
cleanup program.
But neither Palo Alto nor the county is willing to pay for the removal of the contaminated soil -- an
expense that could range from $400,000 to more than $1 million, depending on whether the
pollutants have leaked into groundwater.

The two sides had just agreed to hire a private mediator to resolve the dispute when a Palo Alto
city engineer unearthed the old records.

Now Palo Alto's public works engineers have become sleuths, investigating their new findings in
the hope of finding that the oil company is the culprit. Until more evidence is found, the city won't
name the suspected corporation.

The private mediation, in the meantime, has been put on hold.

''Until we find out who exactly installed the tanks, and if they are the responsible party, we're
going to wait it out," Zaner said.

The tank dispute has strained relations between the city and county.

Palo Alto owns the airport land, but since the early 1960s has leased it to the county, which
manages the airport.

Both governments have been under pressure to resolve the problem because both have to abide
by their own tough laws on toxic polluters.

But the potentially high cost had both sides balking at a settlement.

When asked for a ballpark estimate of how much the city could end up paying for the cleanup,
Zaner said, "I don't want to hazard a guess."

About three years ago, airport workers discovered the abandoned tanks, which apparently had
been used to store waste oil. No one knew exactly when the tanks got there or how long they had
been used.

In an effort to quickly get the tanks out of the ground, the city and county struck a deal. Palo Alto
paid $70,000 to remove the tanks, and in turn, the county agreed to landscape some streets
around the airport and arrange for a study of airport noise.

But in late 1988, it became apparent that the problem was much worse than anyone had
imagined.

Consultants hired last year by Palo Alto found "clear evidence that petroleum hydrocarbons have
spread significantly beyond the immediate tank site," according to a city report.

The report recommended further testing of the groundwater underneath the site and of soil under
a nearby parking lot and airplane hangar.

City Manager Bill Zaner sent a letter to County Executive Sally Reed suggesting that the county
split the cleanup costs 50-50 with the city. Reed replied that the county was not responsible, and
did not have the money. So the battle began.

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