Before I Walk an Old Northern Michigan House, I Walk the Weeds Along the Foundation
There is usually a pipe. Two inches across, capped, standing about a foot and a half out of the ground on the north or east side of the house, often behind a lilac somebody planted in 1974 so they wouldn't have to look at it. A few feet over there's a skinnier one with a little candy-cane bend at the top. Those two together mean there is, or was, a buried oil tank down there.
I look for them before I look at the kitchen.
September is when this starts coming up. The furnace guys are booked three weeks out, the fuel companies are running their first fills of the season, and a lot of the older places up here hit the market right after Labor Day once the summer people finally decide to list. So it's worth knowing what Michigan requires when one of those tanks comes out of the ground, which is less than most buyers assume.
What the pipes look like
The fill pipe is the fat one. It has a cap you can usually unscrew with a pipe wrench, and if the tank was abandoned properly that cap should be bolted shut or the pipe cut off below grade. The vent is the skinny one with the bend, and on a tank that's still in service it'll have a whistle in it so the delivery driver can hear when it's getting full.
Inside, look at the basement wall where the copper would have come through. On a converted house you'll often find two cut-off stubs about six inches apart, painted over, sometimes with a scrap of insulation jammed in the hole. Somebody switched to propane or a heat pump in 1998, cut the lines, and left the tank in the yard.
One thing that surprises people is that a tank sitting in the basement is not an underground tank as far as the state is concerned. EGLE's guidance treats a basement tank as an aboveground tank with its own closure rules, even though it is below grade in every ordinary sense of the word, and an aboveground tank can legally stay put once it has been emptied, cleaned and secured.
Other tells, in no particular order: a patch of lawn greener or deader than everything around it, a ring of settled ground about the size of a bathtub, a whiff of diesel in the basement on a humid day, dead arborvitae on one side of the house only.
The 1,100-gallon line
This is the part I want buyers to understand. Under Michigan's flammable and combustible liquids rules, written under the state Fire Prevention Code, an underground heating oil tank that has been out of service more than twelve months has to come out of the ground, unless pulling it would threaten the structural integrity of a nearby building. If it stays, it has to be filled completely with sand, gravel or cement slurry so it can't collapse into a sinkhole ten years from now. A basement tank that gets removed has to have its fill pipe blind flanged, which is a solid steel disk bolted into the joint, so that nobody's driver hooks up in January and pumps two hundred gallons onto your floor.
Now the part that decides what happens to the dirt. A site assessment, which is the step where somebody samples the soil under the tank, is required only for underground heating oil tanks of 1,100 gallons or more. Below that the state recommends it. Not requires.
Almost every residential tank up here is 275 or 550 gallons.
Which means the fully legal path for the large majority of buried oil tanks in Grand Traverse, Leelanau, Antrim and Benzie counties goes like this: empty it, clean it, dig it up, haul it to the scrap yard, backfill the hole, and never find out what was underneath. The tank is gone. The paperwork is clean. Whatever leaked out of it in 1981 is still sitting there when you take title.
Who pays
Michigan does run a cleanup fund for leaking underground tanks, and it's a real one, reimbursing up to a million dollars per claim with a $2,000 deductible for owners of seven or fewer tanks. Heating oil for consumptive use on the premises is excluded from it. That fund exists for the gas station on the corner, not for your cottage.
Insurance isn't much better. EGLE's own homeowner brochure says plainly that most insurance companies will not cover the cost of cleaning up a release from a heating oil tank, and suggests asking your carrier whether they will write a rider. Given what has happened to Michigan homeowners insurance in the last two years, I wouldn't assume that rider is cheap, or that it's on offer at all.
On cost, the national contractor numbers for pulling a 550-gallon residential tank run somewhere around $1,800 to $2,500, and soil remediation runs from a couple thousand into five figures depending on how far the oil traveled. I don't have a reliable Leelanau County number for you and I'm not going to pretend otherwise. Call an excavator who has done a few up here and ask what the bad ones turned into. That answer is worth more than a range off the internet.
Writing it into the offer
The Michigan seller's disclosure statement does ask about this. Under environmental problems it lists "fuel or chemical storage tanks and contaminated soil on the property," which is about as direct as that form ever gets. But the standard is the seller's knowledge, and an estate or trust sale will check unknown straight down the column, which is exactly the situation where a forgotten tank is most likely to be out there in the first place. I got into how far that form really gets you in an earlier note.
If there's an unexplained pipe and the house predates 1975, I'd make the tank its own contingency instead of folding it into the general inspection. Pull it before closing at the seller's expense, with soil samples taken from directly under the tank bottom and under the fill end, and results back in your hands before you're committed. If the seller won't do it, price it.
There's also a Michigan-specific tool worth knowing about. Part 201 lets a buyer conduct a baseline environmental assessment, a BEA, which documents the contamination that was already there the day you bought. Done correctly it shields you from liability for the previous owner's mess. The timing is unforgiving. The BEA has to be conducted before, or within 45 days after, the earlier of your purchase or your occupancy, and submitted to EGLE within six months of becoming the owner. Miss either deadline and the protection is gone. I'm not an environmental consultant and you shouldn't lean on a blog post for this one, but it's worth raising with your attorney before you waive anything.
One boring detail that will save you a phone call. If something does need reporting, the EGLE remediation district office you call depends on the county. Grand Traverse, Leelanau, Benzie and Kalkaska all report to Cadillac. Antrim reports to Gaylord. Permits for the removal itself vary township to township, some route it through the fire department and some through the building department, so ask before you book the excavator.
I wouldn't close on a pre-1975 house with a mystery pipe in the yard without getting the tank out first. That's my line, and I'll hold it even on a house I love. Nearly everything else about an old place up here is negotiable. I'd just rather find this one during escrow than two winters later when the well test comes back strange.
If you're looking at something older, out in Cedar or Maple City or anywhere along the back roads where the gas main never reached, send me the address and I'll tell you what I'd want looked at. Most of the time there's no tank and it's a ten-minute conversation.
Taylor Brown, Realtor
Taylor@taylorbrownrealtor.com
