794 Gas Stations In Final Days As Deadline For New Rule Looms

Written by Yudislaidy Fernandez on December 3, 2009

By Yudislaidy Fernandez
Almost 800 Miami-Dade gas stations are running out of gas as they fail to comply with state environmental rules effective Jan. 1, fueling a rapid shifting of gears in both the industry and the real estate market.

Owners have until then to meet new rules that require double-walled fuel storage tanks to prevent leakage. Stations that haven’t upgraded tanks or contracted for them by then face $10,000 daily fines and eventual shutdown.

The deadline couldn’t have come at worse time for many station operators, who must pay up to $400,000 for upgrades when business is slow and banks aren’t doing financing.

Abandoned stations are likely to end up in the hands of a larger operator who can buy the site at a lower price, says longtime gasoline supplier and station owner Maximo Alvarez, or get snatched by users like banks or fast-food chains that favor corner locations.

Mr. Alvarez has completed upgrades on 141 gas stations but has about 40 more in line for new tanks.

"This is not an investment, it is an expense," because installing new tanks won’t increase revenues, said Mr. Alvarez, owner and president of Sunshine Gas Distributors. With sales down and banks not lending, he says, it’s challenging to spend $400,000 per location.

Miami-Dade leads the pack with 794 out-of-compliance gas stations that could face closings, followed by Palm Beach with 337 and Broward with 335, a November list from the Florida Department for Environmental Protection shows.

Rules to upgrade single-walled underground storage tanks and piping with double-walled systems were set in 1991. The department says it doesn’t plan to extend deadlines and enforcement is to begin immediately.