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1 r-_ .. lb United States Department of the Interior Memorandum To: From: Subject: OFFICE OF THE SOLICITOR WASHINGTON, D.C. 20240 AUG 8 tqr Regional Solicitors Deputy Solicitor Fees and Permits to Operate Underground Storage Tanks Many of you have received or will receive questions from our clients concerning the payment of fees for the operation of underground storage tanks. Some states have issued assessments for those fees, others will be doing so in the upcoming year. The fees need to be reviewed carefully to determine if federal law allows for payment. The purpose of this memorandum is to provide guidance to you that will be helpful in determining whether these fees can lawfully be paid. The Resource Conservation and Recovery Act (RCRA), 42 USC § 6991f (1988), establishes a regulatory scheme for underground "PYs4; storage tanks (UST) and_�ovides that "'reasonable service charges' can bby the state on feceral agencies under Section 9007. Each department, agency, and instrumentality of the executive, legislative, and -iudicial branches of the Federal Government having jurisdiction over any underground storage tank shall be subject to and comply with all Federal, State, interstate and local requirements, applicable to such tank, both substantive and procedural, in the same manner, and to the same extent, as any other person is subject to such• raquiremertc, including payment cf reasonable service charges. (Emphasis added) Each state can enact and implement its own sepeitg,te fee system. If the charge constitutes a "'reasonable service charge,' the Federal agency must pay it under RCRA. If the charge is actually a tax, the federal government is not obligated to pay. Each state statute that authorizes the collection of fees for UST must be separately'reviewed. The mere designation of an assessment as a "feel or a "'tax" is not dispositive of whether it actually is a fee or tax. The assessment must be analyzed in light of the three -pronged test provided by the United States Supreme Court in Massachusetts v. United States, 435 U.S. 444 (1978). If the assessment fails any of the three prongs, it is a tax on the United States and, therefore, impermissible.