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When workers dug up two rusting steel storage tanks from beneath the parking lot of 111 Santa Rosa Ave. in 2006, Joan Fleck noticed something curious.

The experienced regulator for the North Coast Water Quality Control Board observed that the tanks appeared to have been "tucked in" with a bed of gravel and covered by a layer of sand.

It was as if someone had uncovered the tanks and piping while grading the site, covered them back up and built a parking lot on top of them.

"They were exposed at one point," Fleck said. "Someone had to have seen them to drape this gravel blanket over the top of them."

Whether anyone knew about those two tanks at the time of the development of the office building in 1989 may never be known.

Hal Musco, the managing partner of the group that developed the property, died in 1993. Richard Colombini, a partner in the group and local commercial builder who built the four-story office building, said he never knew about the tanks back then.

"Had we known they were there, we would have dealt with it," Colombini said this week. "We had no idea in hell that all these tanks were in the ground."

But he and others did know about a third tank, one that regulators believe wasn't dealt with properly and continues to contribute to the contamination on the property.

Colombini recalls that during the excavation work for the parking lot, workers reported running into a long steel tank on the southern portion of the site, very close to a high-pressure gas line.

Records show that in February 1989, David Lampi, a son-in-law of Musco, requested a hazardous-waste permit from the Santa Rosa Fire Department to allow the tank to be abandoned in place.

Such requests are made when removal is not feasible and today are rarely granted, said Scott Moon, Santa Rosa's fire marshal.

The section of the permit asking about the amount and nature of material in the tank reads "unknown." Fire inspectors granted the permit with one condition: "abandon and fill with inert material (concrete/sand slurry)."

Colombini, a Santa Rosa native who at 81 still works in the dark-paneled Healdsburg Avenue office his firm Colombini Construction has occupied since the early 1960s, said he recalls that holes were cut into the tank and he believes the material inside was tested.

The work was likely done by Musco's company, Musco Petroleum, he said. He understood the material had been determined to be sand, Colombini said.

"I didn't personally test it," he said.

Seeing no need to remove the existing material, a mixture of sand and slurry was pumped in to fill the rest of the tank and the parking lot was built as planned, Colombini said.

He insisted that all work was done "by the book" and approved by city officials. "Whatever the regulations were, we met them," he said.

Musco long maintained the tank had been properly abandoned in place, something Fleck called "a story told repeatedly in the environmental documents prepared for the site," she said.

There's just one problem. Years later, the 11,000-gallon tank has been found to be "filled with coal tar," a toxic residue of the coal-gas manufacturing process, according to a study by Terra Pacific, PG&E's environmental engineering firm.

Shown the 2010 report, Colombini said he had never seen it and couldn't explain how coal tar came to be in a tank that was supposed to have been filled with inert material.

PG&E officials said they don't know either.

The removal of the tank and surrounding contaminated soils remains one of the biggest challenges for PG&E as it pursues the cleanup of the property.

It doesn't surprise Hans Herb, an attorney who has worked on underground tank issues in Sonoma County for 25 years, that a former Musco development remains under environmental scrutiny two decades after his death.

Musco was very knowledgeable about contamination issues from a long career in the petroleum services industry, and someone in his position should have known the site would be challenging to develop, Herb said. But Musco didn't have much regard for the stricter environmental regulations coming into play later in his career, often calling them "a bunch of hooey," Herb said.

This may have led him to misjudge his firm's ability to clean up the site or the resolve of regulators trying to ensure it was done so properly.

"He was the kind of guy who probably looked at that site and said, 'This is not a big deal,' " Herb said.

(You can reach Staff Writer Kevin McCallum at 521-5207 or kevin.mccallum@pressdemocrat.com. On Twitter @citybeater.)

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