California petroleum marketers are seeking a grace period for the state's ban on single-walled underground petroleum storage tanks, which takes effect Dec. 31.

By the end of the year, all single-walled tanks in the state must be removed or permanently closed. Fuel stations that miss the deadline can be fined $5,000 per day and their operations can be shut down, despite good faith efforts to comply with the law, the California Fuel & Convenience Alliance said Friday in an alert to members.

CFCA is asking members to urge lawmakers to support AB 626, a bill providing a grace period from enforcement if tank operators are actively trying to remove or close their tanks but are delayed because of circumstances beyond their control.

Though closing a tank should take just a few months, many tank operators are facing permit backlogs, long review processes and stalled financing for removal, the trade group said.

"Some operators are waiting one and a half to two years for local permit approvals," said CFCA.

California also provides financial assistance to small business owners under the Replacing, Removing or Upgrading Underground Storage Tanks program to help them comply with tank regulations.

"RUST fund loan applications are also severely delayed, with one to two year wait times for approvals or denials," the trade group said. "Small businesses depending on these funds are left in limbo."

Small businesses are hardest hit by the single-walled tank deadline. "Unlike larger corporations, small business owners don't have the financial resources
or staff to navigate constant delays and red tape. For some, a red tag [which state regulators place on dispensers when tank systems fail to comply] could
mean closing their doors for good."

CFCA also said that some public institutions like schools, hospitals and local governments own single-walled tanks. "These essential services could also be hit with fines and red tags through no fault of their own."

-Reporting by Donna Harris; Editing by Michael Kelly.