Ill. Admin. Code tit. 35, § 724.245 - Financial Assurance for Post-Closure Care
An owner or operator of a hazardous waste management unit subject to the requirements of Section 724.244 must establish financial assurance for post-closure care in accordance with the approved post-closure plan for the facility 60 days prior to the initial receipt of hazardous waste or the effective date of the regulation, whichever is later. The owner or operator must choose from among the following options:
a) Post-Closure Trust Fund
1) An owner or operator may satisfy the
requirements of this Section by establishing a post-closure trust fund that
conforms to the requirements of this subsection (a) and submitting an original,
signed duplicate of the trust agreement to the Agency. An owner or operator of
a new facility must submit the original, signed duplicate of the trust
agreement to the Agency at least 60 days before the date on which hazardous
waste is first received for disposal. The trustee must be an entity that has
the authority to act as a trustee and whose trust operations are regulated and
examined by a federal or State agency.
2) The wording of the trust agreement must be
that specified in Section
724.251
and the trust agreement accompanied by a formal certification of acknowledgment
(as specified in Section 724.251). Schedule A of the trust agreement must be
updated within 60 days after a change in the amount of the current post-closure
cost estimate covered by the agreement.
3) Payments into the trust fund must be made
annually by the owner or operator over the term of the initial RCRA permit or
over the remaining operating life of the facility as estimated in the closure
plan, whichever period is shorter; this period is hereafter referred to as the
"pay-in period". The payments into the post-closure trust fund must be made as
follows:
A) For a new facility, the first
payment must be made before the initial receipt of hazardous waste for
disposal. A receipt from the trustee for this payment must be submitted by the
owner or operator to the Agency before this initial receipt of hazardous waste.
The first payment must be at least equal to the current post-closure cost
estimate, except as provided in subsection (g), divided by the number of years
in the pay-in period. Subsequent payments must be made no later than 30 days
after each anniversary date of the first payment. The amount of each subsequent
payment must be determined by the following formula:
Next Payment = Click here to view image
Where:
|
CE |
= |
the current closure cost estimate |
|
CV |
= |
the current value of the trust fund |
|
Y |
= |
the number of years remaining in the pay-in period |
B) If
an owner or operator establishes a trust fund, as specified in 35 Ill. Adm.
Code
725.245(a),
and the value of that trust fund is less than the current post-closure cost
estimate when a permit is awarded for the facility, the amount of the current
post-closure cost estimate still to be paid into the trust fund must be paid in
over the pay-in period as defined in subsection (a)(3). Payments must continue
to be made no later than 30 days after each anniversary date of the first
payment made pursuant to 35 Ill. Adm. Code 725. The amount of each payment must
be determined by the following formula:
Next Payment = Click here to view image
Where:
|
CE |
= |
the current closure cost estimate |
|
CV |
= |
the current value of the trust fund |
|
Y |
= |
the number of years remaining in the pay-in period |
4) The owner or operator may accelerate
payments into the trust fund or may deposit the full amount of the current
post-closure cost estimate at the time the fund is established. However, the
owner or operator must maintain the value of the fund at no less than the value
that the fund would have if annual payments were made as specified in
subsection (a)(3).
5) If the owner
or operator establishes a post-closure trust fund after having used one or more
alternative mechanisms specified in this Section or in 35 Ill. Adm. Code
725.245, its first payment must be in at least the amount that the fund would
contain if the trust fund were established initially and annual payments made
according to specifications of this subsection (a) and 35 Ill. Adm. Code
725.245, as applicable.
6) After
the pay-in period is completed, whenever the current post-closure cost estimate
changes during the operating life of the facility, the owner or operator must
compare the new estimate with the trustee's most recent annual valuation of the
trust fund. If the value of the fund is less than the amount of the new
estimate, the owner or operator, within 60 days after the change in the cost
estimate, must either deposit an amount into the fund so that its value after
this deposit at least equals the amount of the current post-closure cost
estimate, or obtain other financial assurance, as specified in this Section, to
cover the difference.
7) During the
operating life of the facility, if the value of the trust fund is greater than
the total amount of the current post-closure cost estimate, the owner or
operator may submit a written request to the Agency for release of the amount
in excess of the current post-closure cost estimate.
8) If an owner or operator substitutes other
financial assurance as specified in this Section for all or part of the trust
fund, it may submit a written request to the Agency for release of the amount
in excess of the current post-closure cost estimate covered by the trust
fund.
9) Within 60 days after
receiving a request from the owner or operator for release of funds, as
specified in subsection (a)(7) or (a)(8), the Agency must instruct the trustee
to release to the owner or operator such funds as the Agency specifies in
writing.
10) During the period of
post-closure care, the Agency must approve a release of funds if the owner or
operator demonstrates to the Agency that the value of the trust fund exceeds
the remaining cost of post-closure care.
11) An owner or operator or any other person
authorized to perform post-closure care may request reimbursement for
post-closure care expenditures by submitting itemized bills to the Agency.
Within 60 days after receiving bills for post-closure activities, the Agency
must instruct the trustee to make requirements in those amounts that the Agency
specifies in writing if the Agency determines that the post-closure care
expenditures are in accordance with the approved post-closure plan or otherwise
justified. If the Agency does not instruct the trustee to make such
reimbursements, the Agency must provide the owner or operator with a detailed
written statement of reasons.
12)
The Agency must agree to termination of the trust when either of the following
occurs:
A) An owner or operator substitutes
alternative financial assurance, as specified in this Section; or
B) The Agency releases the owner or operator
from the requirements of this Section in accordance with subsection
(i).
b) Surety
Bond Guaranteeing Payment into a Post-Closure Trust Fund
1) An owner or operator may satisfy the
requirements of this Section by obtaining a surety bond that conforms to the
requirements of this subsection (b) and submitting the bond to the Agency. An
owner or operator of a new facility must submit the bond to the Agency at least
60 days before the date on which hazardous waste is first received for
disposal. The bond must be effective before this initial receipt of hazardous
waste. The surety company issuing the bond must, at a minimum, be among those
listed as acceptable sureties on federal bonds in Circular 570 of the U.S.
Department of the Treasury.
BOARD NOTE: The U.S. Department of the Treasury updates Circular 570, "Companies Holding Certificates of Authority as Acceptable Sureties on Federal Bonds and as Acceptable Reinsuring Companies", on an annual basis pursuant to 31 CFR 223.16. Circular 570 is available on the Internet from the following website: http://www.fms.treas.gov/c570/.
2) The wording of the surety bond
must be that specified in Section 724.251.
3) The owner or operator who uses a surety
bond to satisfy the requirements of this Section must also establish a standby
trust fund. Under the terms of the bond, all payments made thereunder will be
deposited by the surety directly into the standby trust fund in accordance with
instructions from the Agency. This standby trust fund must meet the
requirements specified in subsection (a), except as follows:
A) An original, signed duplicate of the trust
agreement must be submitted to the Agency with the surety bond; and
B) Until the standby trust fund is funded
pursuant to the requirements of this Section, the following are not required by
these regulations:
i) Payments into the trust
fund, as specified in subsection (a);
ii) Updating of Schedule A of the trust
agreement (as specified in Section 724.251) to show current post-closure cost
estimates;
iii) Annual valuations,
as required by the trust agreement; and
iv) Notices of nonpayment, as required by the
trust agreement.
4) The bond must guarantee that the owner or
operator will do one of the following:
A)
Fund the standby trust fund in an amount equal to the penal sum of the bond
before the beginning of final closure of the facility;
B) Fund the standby trust fund in an amount
equal to the penal sum within 15 days after an order to begin closure is issued
by the Board or a U.S. district court or other court of competent jurisdiction;
or
C) Provide alternative financial
assurance as specified in this Section, and obtain the Agency's written
approval of the assurance provided, within 90 days after receipt by both the
owner or operator and the Agency of a notice of cancellation of the bond from
the surety.
5) Under the
terms of the bond, the surety will become liable on the bond obligation when
the owner or operator fails to perform as guaranteed by the bond.
6) The penal sum of the bond must be in an
amount at least equal to the current post-closure cost estimate, except as
provided in subsection (g).
7)
Whenever the current post-closure cost estimate increases to an amount greater
than the penal sum, the owner or operator, within 60 days after the increase,
must either cause the penal sum to be increased to an amount at least equal to
the current post-closure cost estimate and submit evidence of such increase to
the Agency or obtain other financial assurance, as specified in this Section,
to cover the increase. Whenever the current post-closure cost estimate
decreases, the penal sum may be reduced to the amount of the current
post-closure cost estimate following written approval by the Agency.
8) Under the terms of the bond, the surety
may cancel the bond by sending notice of cancellation by certified mail to the
owner or operator and to the Agency. Cancellation may not occur, however,
during the 120 days beginning on the date of receipt of the notice of
cancellation by both the owner or operator and the Agency, as evidence by the
return receipts.
9) The owner or
operator may cancel the bond if the Agency has given prior written consent
based on its receipt of evidence of alternative financial assurance, as
specified in this Section.
c) Surety Bond Guaranteeing Performance of
Post-Closure Care
1) An owner or operator may
satisfy the requirements of this Section by obtaining a surety bond that
conforms to the requirements of this subsection (c) and submitting the bond to
the Agency. An owner or operator of a new facility must submit the bond to the
Agency at least 60 days before the date on which hazardous waste is first
received for disposal. The bond must be effective before this initial receipt
of hazardous waste. The surety company issuing the bond must, at a minimum, be
among those listed as acceptable sureties on federal bonds in Circular 570 of
the U.S. Department of the Treasury.
BOARD NOTE: The U.S. Department of the Treasury updates Circular 570, "Companies Holding Certificates of Authority as Acceptable Sureties on Federal Bonds and as Acceptable Reinsuring Companies", on an annual basis pursuant to 31 CFR 223.16. Circular 570 is available on the Internet from the following website: http://www.fms.treas.gov/c570/.
2) The wording of the surety bond
must be that specified in Section 724.251.
3) The owner or operator who uses a surety
bond to satisfy the requirements of this Section must also establish a standby
trust fund. Under the terms of the bond, all payments made thereunder will be
deposited by the surety directly into the standby trust fund in accordance with
instructions from the Agency. This standby trust must meet the requirements
specified in subsection (a), except as follows:
A) An original, signed duplicate of the trust
agreement must be submitted to the Agency with the surety bond; and
B) Unless the standby trust fund is funded
pursuant to the requirements of this Section, the following are not required:
i) Payments into the trust fund, as specified
in subsection (a);
ii) Updating of
Schedule A of the trust agreement (as specified in Section 724.251) to show
current post-closure cost estimates;
iii) Annual valuations, as required by the
trust agreement; and
iv) Notices of
nonpayment, as required by the trust agreement.
4) The bond must guarantee that the owner or
operator will do either of the following:
A)
Perform final post-closure care in accordance with the post-closure plan and
other requirements of the permit for the facility; or
B) Provide alternative financial assurance,
as specified in this Section, and obtain the Agency's written approval of the
assurance provided, within 90 days after receipt by both the owner or operator
and the Agency of a notice of cancellation of the bond from the
surety.
5) Under the
terms of the bond, the surety will become liable on the bond obligation when
the owner or operator fails to perform as guaranteed by the bond. Following a
final judicial determination or Board order finding that the owner or operator
has failed to perform post-closure care in accordance with the approved
post-closure plan and other permit requirements, under the terms of the bond
the surety will perform post-closure care in accordance with post-closure plan
and other permit requirements or will deposit the amount of the penal sum into
the standby trust fund.
6) The
penal sum of the bond must be in an amount at least equal to the current
post-closure cost estimate.
7)
Whenever the current post-closure cost estimate increases to an amount greater
than the penal sum during the operating life of the facility, the owner or
operator, within 60 days after the increase, must either cause the penal sum to
be increased to an amount at least equal to the current post-closure cost
estimate and submit evidence of such increase to the Agency, or obtain other
financial assurance, as specified in this Section. Whenever the current closure
cost estimate decreases during the operating life of the facility, the penal
sum may be reduced to the amount of the current post-closure cost estimate
following written approval by the Agency.
8) During the period of post-closure care,
the Agency must approve a decrease in the penal sum if the owner or operator
demonstrates to the Agency that the amount exceeds the remaining cost of
post-closure care.
9) Under the
terms of the bond, the surety may cancel the bond by sending notice of
cancellation by certified mail to the owner or operator and to the Agency.
Cancellation may not occur, however, during the 120 days beginning on the date
of receipt of the notice of cancellation by both the owner or operator and the
Agency, as evidenced by the return receipts.
10) The owner or operator may cancel the bond
if the Agency has given prior written consent. The Agency must provide such
written consent when either of the following occurs:
A) An owner or operator substitutes
alternative financial assurance as specified in this Section; or
B) The Agency releases the owner or operator
from the requirements of this Section in accordance with subsection
(i).
11) The surety will
not be liable for deficiencies in the performance of post-closure care by the
owner or operator after the Agency releases the owner or operator from the
requirements of this Section in accordance with subsection (i).
d) Post-Closure Letter of Credit
1) An owner or operator may satisfy the
requirements of this Section by obtaining an irrevocable standby letter of
credit that conforms to the requirements of this subsection (d) and submitting
the letter to the Agency. An owner or operator of a new facility must submit
the letter of credit to the Agency at least 60 days before the date on which
hazardous waste is first received for disposal. The letter of credit must be
effective before this initial receipt of hazardous waste. The issuing
institution must be an entity that has the authority to issue letters of credit
and whose letter-of-credit operations are regulated and examined by a federal
or State agency.
2) The wording of
the letter of credit must be that specified in Section 724.251.
3) An owner or operator who uses a letter of
credit to satisfy the requirements of this Section must also establish a
standby trust fund. Under the terms of the letter of credit, all amounts paid
pursuant to a draft by the Agency must be deposited by the issuing institution
directly into the standby trust fund in accordance with instructions from the
Agency. This standby trust fund must meet the requirements of the trust fund
specified in subsection (a), except as follows:
A) An original, signed duplicate of the trust
agreement must be submitted to the Agency with the letter of credit;
and
B) Unless the standby trust
fund is funded pursuant to the requirements of this Section, the following are
not required by these regulations:
i)
Payments into the trust fund, as specified in subsection (a);
ii) Updating of Schedule A of the trust
agreement (as specified in Section 724.251) to show current post-closure cost
estimates;
iii) Annual valuations,
as required by the trust agreement; and
iv) Notices of nonpayment, as required by the
trust agreement.
4) The letter or credit must be accompanied
by a letter from the owner or operator referring to the letter of credit by
number, issuing institution, and date and providing the following information:
the USEPA identification number, name and address of the facility, and the
amount of funds assured for post-closure care of the facility by the letter of
credit.
5) The letter of credit
must be irrevocable and issued for a period of at least one year. The letter of
credit must provide that the expiration date will be automatically extended for
a period of at least one year unless, at least 120 days before the current
expiration date, the issuing institution notifies both the owner or operator
and the Agency by certified mail of a decision not to extend the expiration
date. Under the terms of the letter of credit, the 120 days will begin on the
date when both the owner or operator and the Agency have received the notice,
as evidenced by the return receipts.
6) The letter of credit must be issued in an
amount at least equal to the current post-closure cost estimate, except as
provided in subsection (g).
7)
Whenever the current post-closure cost estimate increases to an amount greater
than the amount of the credit during the operating life of the facility, the
owner or operator, within 60 days after the increase, must either cause the
amount of the credit to be increased so that it at least equals the current
post-closure cost estimate and submit evidence of such increase to the Agency,
or obtain other financial assurance as specified in this Section to cover the
increase. Whenever the current post-closure cost estimate decreases during the
operating life of the facility, the amount of the credit may be reduced to the
amount of the current post-closure cost estimate following written approval by
the Agency.
8) During the period of
post-closure care, the Agency must approve a decrease in the amount of the
letter of credit if the owner or operator demonstrates to the Agency that the
amount exceeds the remaining cost of post-closure care.
9) Following a final judicial determination
or Board order finding that the owner or operator has failed to perform
post-closure care in accordance with the approved post-closure plan and other
permit requirements, the Agency may draw on the letter of credit.
10) If the owner or operator does not
establish alternative financial assurance, as specified in this Section, and
obtain written approval of such alternative assurance from the Agency within 90
days after receipt by both the owner or operator and the Agency of a notice
from the issuing institution that it has decided not to extend the letter of
credit beyond the current expiration date, the Agency must draw on the letter
of credit. The Agency may delay the drawing if the issuing institution grants
an extension of the term of the credit. During the last 30 days of any such
extension the Agency must draw on the letter of credit if the owner or operator
has failed to provide alternative financial assurance, as specified in this
Section, and obtain written approval of such assurance from the
Agency.
11) The Agency must return
the letter of credit to the issuing institution for termination when either of
the following occurs:
A) An owner or operator
substitutes alternative financial assurance, as specified in this Section;
or
B) The Agency releases the owner
or operator from the requirements of this Section in accordance with subsection
(i).
e)
Post-Closure Insurance
1) An owner or
operator may satisfy the requirements of this Section by obtaining post-closure
insurance that conforms to the requirements of this subsection (e) and
submitting a certificate of such insurance to the Agency. An owner or operator
of a new facility must submit the certificate of insurance to the Agency at
least 60 days before the date on which hazardous waste is first received for
disposal. The insurance must be effective before this initial receipt of
hazardous waste. At a minimum, the insurer must be licensed to transact the
business of insurance or be eligible to provide insurance as an excess or
surplus lines insurer in one or more states.
2) The wording of the certificate of
insurance must be that specified in Section 724.251.
3) The post-closure insurance policy must be
issued for a face amount at least equal to the current post-closure cost
estimate, except as provided in subsection (g). The term "face amount" means
the total amount the insurer is obligated to pay under the policy. Actual
payments by the insurer will not change the face amount, although the insurer's
future liability will be lowered by the amount of the payments.
4) The post-closure insurance policy must
guarantee that funds will be available to provide post-closure care of facility
whenever the post-closure period begins. The policy must also guarantee that,
once post-closure care begins, the insurer will be responsible for paying out
funds, up to an amount equal to the face amount of the policy, upon the
direction of the Agency to such party or parties as the Agency
specifies.
5) An owner or operator
or any other person authorized to perform post-closure care may request
reimbursement for post-closure care expenditures by submitting itemized bills
to the Agency. Within 60 days after receiving bills for post-closure
activities, the Agency must instruct the insurer to make reimbursement in such
amounts as the Agency specifies in writing if the Agency determines that the
post-closure care expenditures are in accordance with the approved post-closure
plan or otherwise justified. If the Agency does not instruct the insurer to
make such reimbursements, the Agency must provide the owner or operator with a
detailed written statement of reasons.
6) The owner or operator must maintain the
policy in full force and effect until the Agency consents to termination of the
policy by the owner or operator as specified in subsection (e)(11). Failure to
pay the premium, without substitution of alternative financial assurance as
specified in this Section, will constitute a significant violation of these
regulations, warranting such remedy as the Board may impose pursuant to the
Environmental Protection Act. Such violation will be deemed to begin upon
receipt by the Agency of a notice of future cancellation, termination, or
failure to renew due to nonpayment of the premium, rather than upon the date of
expiration.
7) Each policy must
contain a provision allowing assignment of the policy to a successor owner or
operator. Such assignment may be conditional upon consent of the insurer,
provided such consent is not unreasonably refused.
8) The policy must provide that the insurer
may not cancel, terminate, or fail to renew the policy except for failure to
pay the premium. The automatic renewal of the policy must, at a minimum,
provide the insured with the option of renewal at the face amount of the
expiring policy. If there is a failure to pay the premium, the insurer may
elect to cancel, terminate, or fail to renew the policy by sending notice by
certified mail to the owner or operator and the Agency. Cancellation,
termination, or failure to renew may not occur, however, during the 120 days
beginning with the date of receipt of the notice by both the Agency and the
owner or operator, as evidenced by the return receipts. Cancellation,
termination, or failure to renew may not occur, and the policy will remain in
full force and effect, in the event that on or before the date of expiration
one of the following occurs:
A) The Agency
deems the facility abandoned;
B)
The permit is terminated or revoked or a new permit is denied;
C) Closure is ordered by the Board or a U.S.
district court or other court of competent jurisdiction;
D) The owner or operator is named as debtor
in a voluntary or involuntary proceeding under 11 USC (Bankruptcy);
or
E) The premium due is
paid.
9) Whenever the
current post-closure cost estimate increases to an amount greater than the face
amount of the policy during the life of the facility, the owner or operator,
within 60 days after the increase, must either cause the face amount to be
increased to an amount at least equal to the current post-closure cost estimate
and submit evidence of such increase to the Agency or obtain other financial
assurance, as specified in this Section, to cover the increase. Whenever the
current post-closure cost estimate decreases during the operating life of the
facility, the face amount may be reduced to the amount of the current
post-closure cost estimate following written approval by the Agency.
10) Commencing on the date that liability to
make payments pursuant to the policy accrues, the insurer must thereafter
annually increase the face amount of the policy. Such increase must be
equivalent to the face amount of the policy, less any payments made, multiplied
by an amount equivalent to 85 percent of the most recent investment rate or of
the equivalent coupon-issue yield announced by the U.S. Treasury for 26-week
Treasury securities.
11) The Agency
must give written consent to the owner or operator that the owner or operator
may terminate the insurance policy when either of the following occurs:
A) An owner or operator substitutes
alternative financial assurance, as specified in this Section; or
B) The Agency releases the owner or operator
from the requirements of this Section in accordance with subsection
(i).
f)
Financial Test and Corporate Guarantee for Post-Closure Care
1) An owner or operator may satisfy the
requirements of this Section by demonstrating that it passes a financial test
as specified in this subsection (f). To pass this test the owner or operator
must meet the criteria of either subsection (f)(1)(A) or (f)(1)(B):
A) The owner or operator must have the
following:
i) Two of the following three
ratios: a ratio of total liabilities to net worth less than 2.0; a ratio of the
sum of net income plus depreciation, depletion and amortization to total
liabilities greater than 0.1; and a ratio of current assets to current
liabilities greater than
1.5;
ii) Net working capital and tangible net
worth each at least six times the sum of the current closure and post-closure
cost estimates and the current plugging and abandonment cost
estimates;
iii) Tangible net worth
of at least $10 million; and
iv)
Assets in the United States amounting to at least 90 percent of its total
assets or at least six times the sum of the current closure and post-closure
cost estimates and the current plugging and abandonment cost
estimates.
B) The owner
or operator must have the following:
i) A
current rating for its most recent bond issuance of AAA, AA, A, or BBB as
issued by Standard and Poor's or Aaa, Aa, A, or Baa as issued by
Moody's;
ii) Tangible net worth at
least six times the sum of the current closure and post-closure cost estimates
and current plugging and abandonment cost estimates;
iii) Tangible net worth of at least $10
million; and
iv) Assets located in
the United States amounting to at least 90 percent of its total assets or at
least six times the sum of the current closure and post-closure cost estimates
and the current plugging and abandonment cost estimates.
2) The phrase "current closure and
post-closure cost estimates", as used in subsection (f)(1), refers to the cost
estimates required to be shown in subsections 1 through 4 of the letter from
the owner's or operator's chief financial officer (see Section 724.251). The
phrase "current plugging and abandonment cost estimates", as used in subsection
(f)(1), refers to the cost estimates required to be shown in subsections 1
through 4 of the letter from the owner's or operator's chief financial officer
(see 35 Ill. Adm. Code
704.240
).
3) To demonstrate that it meets
this test, the owner or operator must submit the following items to the Agency:
A) A letter signed by the owner's or
operator's chief financial officer and worded as specified in Section
724.251;
B) A copy of the
independent certified public accountant's report on examination of the owner's
or operator's financial statements for the latest completed fiscal year;
and
C) A special report from the
owner's or operator's independent certified public accountant to the owner or
operator stating the following:
i) The
accountant has compared the data that the letter from the chief financial
officer specifies as having been derived from the independently audited,
year-end financial statements for the latest fiscal year with the amounts in
such financial statements; and
ii)
In connection with that procedure, no matters came to the accountant's
attention that caused the accountant to believe that the specified data should
be adjusted.
4)
An owner or operator of a new facility must submit the items specified in
subsection (f)(3) to the Agency at least 60 days before the date on which
hazardous waste is first received for disposal.
5) After the initial submission of items
specified in subsection (f)(3), the owner or operator must send updated
information to the Agency within 90 days after the close of each succeeding
fiscal year. This information must consist of all three items specified in
subsection (f)(3).
6) If the owner
or operator no longer meets the requirements of subsection (f)(1), the owner or
operator must send notice to the Agency of intent to establish alternative
financial assurance, as specified in this Section. The notice must be sent by
certified mail within 90 days after the end of the fiscal year for which the
year-end financial data show that the owner or operator no longer meets the
requirements the owner or operator must provide the alternative financial
assurance within 120 days after the end of such fiscal year.
7) Based on a reasonable belief that the
owner or operator may no longer meet the requirements of subsection (f)(1), the
Agency may require reports of financial condition at any time from the owner or
operator in addition to those specified in subsection (f)(3). If the Agency
finds, on the basis of such reports or other information, that the owner or
operator no longer meets the requirements of subsection (f)(1), the owner or
operator must provide alternative financial assurance, as specified in this
Section, within 30 days after notification of such a finding.
8) The Agency may disallow use of this test
on the basis of qualifications in the opinion expressed by the independent
certified public accountant in the accountant's report on examination of the
owner's or operator's financial statements (see subsection (f)(3)(B)). An
adverse opinion or a disclaimer of opinion will be cause for disallowance. The
Agency must evaluate other qualifications on an individual basis. The owner or
operator must provide alternative financial assurance, as specified in this
Section, within 30 days after notification of the disallowance.
9) During the period of post-closure care,
the Agency must approve a decrease in the current post-closure cost estimate
for which this test demonstrates financial assurance if the owner or operator
demonstrates to the Agency that the amount of the cost estimate exceeds the
remaining cost of post-closure care.
10) The owner or operator is no longer
required to submit the items specified in subsection (f)(3) when either of the
following occurs:
A) An owner or operator
substitutes alternative financial assurance, as specified in this Section;
or
B) The Agency releases the owner
or operator from the requirements of this Section in accordance with subsection
(i).
11) An owner or
operator may meet the requirements of this Section by obtaining a written
guarantee, hereafter referred to as "corporate guarantee". The guarantor must
be the direct or higher-tier parent corporation of the owner or operator, a
firm whose parent corporation is also the parent corporation of the owner or
operator, or a firm with a "substantial business relationship" with the owner
or operator. The guarantor must meet the requirements for owners or operators
in subsections (f)(1) through (f)(9), and must comply with the terms of the
corporate guarantee. The wording of the corporate guarantee must be that
specified in Section 724.251. A certified copy of the corporate guarantee must
accompany the items sent to the Agency, as specified in subsection (f)(3). One
of these items must be the letter from the guarantor's chief financial officer.
If the guarantor's parent corporation is also the parent corporation of the
owner or operator, the letter must describe the value received in consideration
of the guarantee. If the guarantor is a firm with a "substantial business
relationship" with the owner or operator, this letter must describe this
"substantial business relationship" and the value received in consideration of
the guarantee. The terms of the corporate guarantee must provide as follows:
A) That if the owner or operator fails to
perform post-closure care of a facility covered by the corporate guarantee in
accordance with the post-closure plan and other permit requirements whenever
required to do so, the guarantor will do so or establish a trust fund as
specified in subsection (a) in the name of the owner or operator.
B) That the corporate guarantee will remain
in force unless the guarantor sends notice of cancellation by certified mail to
the owner or operator and to the Agency. Cancellation may not occur, however,
during the 120 days beginning on the date of receipt of the notice of
cancellation by both the owner or operator and the Agency, as evidenced by the
return receipts.
C) That if the
owner or operator fails to provide alternative financial assurance as specified
in this Section and obtain the written approval of such alternative assurance
from the Agency within 90 days after receipt by both the owner or operator and
the Agency of a notice of cancellation of the corporate guarantee from the
guarantor, the guarantor will provide such alternative financial assurance in
the name of the owner or operator.
g) Use of Multiple Financial Mechanisms. An
owner or operator may satisfy the requirements of this Section by establishing
more than one financial mechanism per facility. These mechanisms are limited to
trust funds, surety bonds guaranteeing payment into a trust fund, letters of
credit and insurance. The mechanisms must be as specified in subsections (a),
(b), (d), and (e), respectively, except that it is the combination of
mechanisms, rather than the single mechanism, that must provide financial
assurance for an amount at least equal to the current post-closure cost
estimate. If an owner or operator uses a trust fund in combination with a
surety bond or a letter of credit, it may use the trust fund as the standby
trust fund for the other mechanisms. A single standby trust fund may be
established for two or more mechanisms. The Agency may use any or all of the
mechanisms to provide for post-closure care of the facility.
h) Use of a Financial Mechanism for Multiple
Facilities. An owner or operator may use a financial assurance mechanism
specified in this Section to meet the requirements of this Section for more
than one facility. Evidence of financial assurance submitted to the Agency must
include a list showing, for each facility, the USEPA identification number,
name, address, and the amount of funds for post-closure care assured by the
mechanism. The amount of funds available through the mechanism must be no less
than the sum of funds that would be available if a separate mechanism had been
established and maintained for each facility. The amount of funds available to
the Agency must be sufficient to close all of the owner or operator's
facilities. In directing funds available through the mechanism for post-closure
care of any of the facilities covered by the mechanism, the Agency may direct
only the amount of funds designated for that facility, unless the owner or
operator agrees to the use of additional funds available under the
mechanism.
i) Release of the Owner
or Operator from the Requirements of this Section. Within 60 days after
receiving certifications from the owner or operator and a qualified
Professional Engineer that the post-closure care period has been completed for
a hazardous waste disposal unit in accordance with the approved plan, the
Agency must notify the owner or operator that it is no longer required to
maintain financial assurance for post-closure care of that unit, unless the
Agency determines that post-closure care has not been in accordance with the
approved post-closure plan. The Agency must provide the owner or operator a
detailed written statement of any such determination that post-closure care has
not been in accordance with the approved post-closure plan.
j) Appeal. The following Agency actions are
deemed to be permit modifications or refusals to modify for purposes of appeal
to the Board (35 Ill. Adm. Code
702.184(e)(3)
):
1) An increase in or a refusal to decrease
the amount of a bond, letter of credit, or insurance;
2) Requiring alternative assurance upon a
finding that an owner or operator or parent corporation no longer meets a
financial test.
Notes
Amended at 32 Ill. Reg. 12365, effective July 14, 2008
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