State Says Company Owes The Money

By: Josh Kovner

The state is trying to reclaim more than $3 million from ExxonMobil, saying the former Exxon Corp. was covered by insurance at the same time it was applying for reimbursements from a trust fund meant to help service stations clean up around leaking underground tanks.

State officials say the oil giant may have received “double-recovery” from insurance settlements and the Underground Storage Tank Trust Fund, a taxpayer-supported account maintained by the state Department of Environmental Protection.

ExxonMobil says not so fast. The corporation has notified tank funds in a number of states that it had a dispute with its insurance companies and says it was “self-insured” when it came to these kinds of environmental clean-up jobs.

The company says it has settled the insurance dispute and is now negotiating with the DEP and Attorney General Richard Blumenthal for “a potential resolution of Connecticut’s claim for reimbursement,” said ExxonMobil spokeswoman Kristen Hellmer.

Michael J. Fox, head of an association of gasoline dealers in Connecticut and a member of the tank fund’s review board, said smaller service-station operators find it next to impossible to get insurance for ongoing environmental clean-up jobs and depend on the fund. He said the trust fund doesn’t have enough money in it to pay claims from service stations that have already been approved.

The DEP stopped processing Exxon claims in 2005, but roughly $3.3 million has already been paid and more than 500 claims totaling hundreds of thousands of dollars are pending, state records show.

Blumenthal said his staff lawyers “are disputing past payments and pending claims by the company, and are working to resolve these disputed claims promptly.”

Fox said he was concerned that any money reclaimed from ExxonMobil would disappear into the state’s general budget, rather than replenish the fund. The trust fund was created in 1989 and was initially supported by a portion of the gasoline tax. Now it’s funded out of the state budget.

ExxonMobil in 2006 settled a claim from the New Hampshire Oil Fund Disbursement Board for a little more than $2 million.