California's RUST Program
RUST stands for Replacing, Removing, or Upgrading Underground Storage Tanks.
The RUST program is a system of grants and loans to help small business owners and operators come into compliance with regulatory requirements for underground storage tanks (USTs). Compliance is achieved through removing, replacing or upgrading USTs. The program is administered by the State Water Resources Control Board.
The RUST Program is a great way for small businesses to protect their business and improve their bottom line. By removing or upgrading their USTs, businesses can reduce their risk of environmental liability and save money on maintenance and repairs.
California's Deadline for the Removal of Single-Walled USTs is December 31, 2025
What Costs are Eligible for a RUST Grant or Loan?
Eligible costs for grants include:
- Costs for removing and replacing single-walled* USTs and/or piping with doubled-walled** USTs and/or piping.
- Costs for upgrades to USTs including installation of containment sumps, under-dispenser containment boxes/pans, and electronic monitoring systems.
- Costs for conducting enhanced leak detection tests.
Eligible costs for loans include those for grants and:
- Costs for corrective actions necessary to meet applicable local, state, or federal standards including, but not limited to, any design, construction, monitoring, operation, or maintenance requirements adopted pursuant to the California Health and Safety Code.
*Single-walled USTs have one wall between the petroleum fuel and the underground soil.
**Double-walled USTs have two walls between the fuel and the underground soil. The second wall provides extra containment that helps to prevent leaks from reaching the soil. It is a tank in a tank (piping in piping) system.
Who is Eligible for a RUST Grant?
Independently owned and operated small businesses with petroleum USTs and fewer than 20 full-time and part-time employees are eligible for a RUST grant. The principal office and business officers must be domiciled in California. Businesses dominant in their field of operation are excluded.
The facility must have legally been in business retailing gasoline after January 1, 1999, and must have sold less than 1,500,000 gallons of gasoline annually for the two years prior to filing an application.
All USTs owned and operated by the applicant are in compliance with State UST regulations. Grant applicants may be eligible for a waiver from the permit compliance and/or retailing gasoline requirements if the project tanks will be removed and will not be replaced with new tanks and the applicant does not qualify for a RUST Loan.
Who is Eligible for a RUST Loan?
Independently owned and operated small businesses with petroleum USTs and fewer than 500 employees are eligible for a RUST loan. As with a grant, the principal office and business officers must be domiciled in California, and businesses dominant in their field of operation are excluded.
All USTs owned and operated by the applicant are in compliance with State UST regulations.
What are the RUST funding amounts?
If you are eligible for RUST funding, you cannot begin work until you have a grant or loan executed by the State Water Board.
RUST Grant Funding Amounts
The RUST program grants are available for between $3,000 and $70,000 per grant.
A small business may receive multiple RUST grants, but the maximum lifetime limit in grant money for each small business is $70,000.
RUST Loan Funding Amounts
Loan terms of 10 or 20 years at ½ the State’s most recent general obligation bond rate are available. Contact the State Water Board for the current interest rate.
Loans are available for between $10,000 and $750,000.
Ten-year loans are secured by a Uniform Commercial Code Financing Statement on the business property, assets, and equipment. Twenty-year loans are secured by a deed of trust on the business property and a Uniform Commercial Code Financing Statement on the business property, assets, and equipment.
Additional collateral and guarantees may be required to provide sufficient security for the loan. The borrower must pay a loan fee of 2 percent at the final loan closing.
How to Finance UST Removal in California
The State Water Resources Control Board offers grants and loans to help small business owners and operators come into compliance with regulatory requirements for USTs. Compliance is achieved through removing, replacing, or upgrading USTs.
We talked about eligible costs, eligibility requirements, and funding. Are you considering replacing, removing, or upgrading USTs? Give us a call at 831-227-4898 or click below for a free consultation.