25 Pa. Code § 86.162b - Land Reclamation Financial Guarantees
(a) The Department will designate funds in
the Land Reclamation Financial Guarantee Account to underwrite Land Reclamation
Financial Guarantees.
(b) The funds
in the Land Reclamation Financial Guarantee Account will be used to cover
obligations for all existing sum-certain financial guarantees needed to
facilitate the implementation of full-cost bonding previously issued by the
Department.
(c) The Department may
issue Land Reclamation Financial Guarantees to financially assure the bonding
obligations of qualified surface coal mining operators engaged in surface
mining activities under §
86.143 (relating to requirement to
file a bond).
(d) The Department
will hold in reserve in the Land Reclamation Financial Guarantee Account funds
that are not designated to underwrite Land Reclamation Financial
Guarantees.
(e) The Department will
use funds held in reserve in the Land Reclamation Financial Guarantee Account
to:
(1) Assure the availability of funds to
cover reclamation liabilities when there is a mine operator bond forfeiture
under §
86.181 (relating to
general).
(2) Underwrite
sum-certain financial guarantees available under Bioenergy Crop Bonding
implemented by §
86.162c (relating to Bioenergy
Crop Bonding).
(3) Transfer funds
available in the Land Reclamation Financial Guarantee Account to the
Reclamation Fee O&M Trust Account.
(f) In administering the Land Reclamation
Financial Guarantee Account, the Department will not issue:
(1) Land Reclamation Financial Guarantees for
a permit in excess of 50% of the required bond amount for that permit, which is
the Permit Limit.
(2) Additional
Land Reclamation Financial Guarantees to a surface mining operator in excess of
the Operator Limit, which is exceeded if the aggregate amount of Land
Reclamation Financial Guarantees on permits issued to the operator exceeds 30%
of the designated amount in the Land Reclamation Financial Guarantee
Account.
(3) Additional Land
Reclamation Financial Guarantees in excess of the Program Limit, which is
exceeded when the aggregate amount of outstanding Land Reclamation Financial
Guarantees is greater than the current designated amount in the Land
Reclamation Financial Guarantee Account divided by the historical rate of mine
operator bond forfeiture under §
86.181, plus a reasonable margin
of safety to protect the account from risk of forfeiture as determined by the
Department.
(g) Any
existing sum-certain financial guarantee needed to facilitate the
implementation of full-cost bonding previously issued by the Department shall
be converted into a Land Reclamation Financial Guarantee subject to the
following:
(1) If the conversion results in a
Land Reclamation Financial Guarantee exceeding the Permit Limit established in
subsection (f)(1), the Land Reclamation Financial Guarantee amount does not
need to be reduced, but the permit will not be eligible for additional Land
Reclamation Financial Guarantees until the total amount of the Land Reclamation
Financial Guarantees for the permit is under the Permit Limit.
(2) If the conversion results in a Land
Reclamation Financial Guarantee for an operator exceeding the Operator Limit
established in subsection (f)(2), the Land Reclamation Financial Guarantee does
not need to be reduced, but the operator will not be eligible for additional
Land Reclamation Financial Guarantees until the total amount of the Land
Reclamation Financial Guarantees for the operator is under the Operator
Limit.
(h) The Department
will periodically, but no less frequently than every 5 years, or upon request
by the Mining and Reclamation Advisory Board, prepare a report containing a
financial analysis of the revenue and expenditures for the Land Reclamation
Financial Guarantee Account.
(1) The report
will evaluate the Permit Limit, the Operator Limit, the Program Limit and the
annual payment percentage rate referenced in subsection (m)(1) for Land
Reclamation Financial Guarantees.
(2) The report will be submitted to the
members of the Mining and Reclamation Advisory Board for their review and
advice.
(3) The report will be
published on the Department's web site.
(4) Notice of availability of the report will
be published in the Pennsylvania Bulletin.
(5) The Department will review the report at
a public meeting of the Mining and Reclamation Advisory Board.
(6) If the Department's review of the report
at a public meeting of the Mining and Reclamation Advisory Board results in a
change to the Permit Limit, the Operator Limit, the Program Limit or the annual
payment percentage rate, the Department will publish a notice of the changes in
the Pennsylvania Bulletin.
(7) Changes to the Permit Limit, the Operator
Limit, the Program Limit or the annual payment percentage rate will become
effective upon publication in the Pennsylvania Bulletin
.
(i) The Department may
transfer interest earned and payments collected and deposited in the Land
Reclamation Financial Guarantee Account into the Reclamation Fee O&M Trust
Account established under §§
86.17 and
86.187 (relating to permit and
reclamation fees; and use of money) to supplement the funding of the
Reclamation Fee O&M Trust Account consistent with section
19.2(b)(5) and
(6) of the Surface Mining Conservation and
Reclamation Act (52 P. S. §
1396.19b(b)(5) and
(6)).
(j) The Department will provide information
about any proposed transfer to the Reclamation Fee O&M Trust Account to the
Mining and Reclamation Advisory Board and solicit advice from Mining and
Reclamation Advisory Board before making the transfer.
(k) To be eligible for a Land Reclamation
Financial Guarantee, a surface coal mining operator shall demonstrate the
following:
(1) The mine operator holds a
valid coal mining license issued under section
3.1 of the Surface Mining
Conservation and Reclamation Act (52 P. S. §
1396.3a).
(2) The mine operator, a related party, a
person who owns or controls the operator, or a person who is owned or
controlled by the operator satisfies the requirements of §
86.37(a)(8)-(11) and
(16) (relating to criteria for permit
approval or denial).
(3) For a mine
operator that has previously obtained a remining financial guarantee under
section 4.12 of the Surface Mining
Conservation and Reclamation Act (52 P. S. §
1396.4l) or a Land Reclamation Financial
Guarantee that has made timely payments for the remining financial guarantee
program or for Land Reclamation Financial Guarantees, an operator will be
eligible under this subsection if it has not been cited through a notice of
violation under §
86.165(a)
(relating to failure to maintain proper bond) within the previous 3 years prior
to the request for a land reclamation financial guarantee.
(4) For operators that have not previously
obtained a remining financial guarantee under section
4.12 of the Surface Mining
Conservation and Reclamation Act or a Land Reclamation Financial Guarantee, the
operator shall demonstrate appropriate experience in surface coal mining and
reclamation by showing that it has had a coal mining license under section
3.1 of the Surface Mining
Conservation and Reclamation Act for at least 5 years and that the operator
would be able to obtain a surety bond otherwise required under this chapter by
submitting either of the following:
(i) A
surety bond for a portion of the remaining reclamation liability for the
proposed site.
(ii) A letter of
acceptance from a surety company licensed to do business in this Commonwealth
and which writes bonds for the reclamation of mine sites located in this
Commonwealth. The acceptance letter must indicate the complete name and address
of the surety company and state that the surety company would write the
bond.
(l) An
application for a Land Reclamation Financial Guarantee must include a
description of:
(1) The environmental and
safety hazards of the site for which a guarantee is proposed.
(2) The availability of coal reserves at the
site.
(3) Any prior denials of
surety coverage.
(m)
Obtaining a Land Reclamation Financial Guarantee is subject to the following:
(1) A mine operator shall make annual
payments to the Department at a rate of 1.5% of the total amount of the Land
Reclamation Financial Guarantee.
(2) The first annual payment is due upon the
operator's receipt of notice of the Department's approval of the operator's
application to obtain a Land Reclamation Financial Guarantee. Payments shall be
made annually thereafter concurrent with the permit anniversary date or in
accordance with a schedule provided by the Department in writing.
(3) The operator is responsible for making
the annual payment as calculated by the Department until the amount of the bond
is reduced or released in accordance with §§
86.170-86.172 (relating to scope;
procedures for seeking release of bond; and criteria for release of
bond).
(4) Payments are not
refundable and will be deposited into the Land Reclamation Financial Guarantee
Account to be used in the event of mine operator bond forfeiture. Excess
payments may be transferred by the Department to the Reclamation Fee O&M
Trust Account consistent with section
19.2(b)(6) of the
Surface Mining Conservation and Reclamation Act.
(5) The operator may not substitute Land
Reclamation Financial Guarantees for existing collateral or surety
bonds.
(n) The Department
may, after soliciting advice from the Mining and Reclamation Advisory Board and
publication in the Pennsylvania Bulletin, adjust the annual
payment percentage rate referred to in subsection (m)(1) to assure financial
stability of the Land Reclamation Financial Guarantee Account and to cover the
Department's costs to administer the guarantees.
(o) The Department will reduce or release an
obligation covered by a Land Reclamation Financial Guarantee prior to any other
bond submitted by the operator to cover the reclamation obligations of a
permit, except that remining financial guarantees issued under section
4.12 of the Surface Mining
Conservation and Reclamation Act will be released before Land Reclamation
Financial Guarantees.
(p) If a
post-mining pollutional discharge develops on a permit for which a Land
Reclamation Financial Guarantee has been obtained, the operator shall, within
90 days of receipt of written notice by the Department, provide to the
Department a separate bond or alternative financial assurance mechanism to
cover the long-term treatment costs associated with the discharge or replace
the Land Reclamation Financial Guarantee with other types of financial
assurance mechanisms authorized for the purpose of covering the costs of
treating the discharge.
(q) Upon
mine operator bond forfeiture under §
86.181, the Department will
declare forfeit the specified amount of the Land Reclamation Financial
Guarantee for the permit in the Land Reclamation Financial Guarantee Account in
addition to other bonds posted by the operator to cover the reclamation
obligation on the permit.
(r) The
Department's declaration of forfeiture under §
86.181 may not discharge an
operator's obligation to meet the requirements of this chapter or other
requirements under the Surface Mining Conservation and Reclamation
Act.
(s) Upon declaration of
forfeiture, the Department will use the bond money posted by the operator, the
specified amount of the Land Reclamation Financial Guarantee, and any other
financial assurance mechanisms to complete the reclamation of the mine site in
accordance with the procedures and criteria in §
86.187 and §§
86.188-86.190 (relating to evaluation of
bond forfeiture sites; reclamation of bond forfeiture sites; and sites where
reclamation is unreasonable, unnecessary or impossible; excess
funds).
(t) The Department may
suspend the issuance of Land Reclamation Financial Guarantees upon notice in
the Pennsylvania Bulletin when the number of participating
permits declared forfeit under this section equals the number of participating
permits multiplied by the historical rate of mine operator bond forfeiture plus
a margin of safety. Issuance of Land Reclamation Financial Guarantees may
resume after the Department conducts an evaluation which demonstrates that
adequate funding is available. The Department's evaluation will take into
account advice received from the Mining and Reclamation Advisory
Board.
(u) The Department will
discontinue the issuance of Land Reclamation Financial Guarantees and notice
will be published in the Pennsylvania Bulletin if 25% or more
of the outstanding bond obligation for all Land Reclamation Financial
Guarantees is declared forfeit under § 86.181.
(v) The Department will not approve
additional Land Reclamation Financial Guarantees if Land Reclamation Financial
Guarantees are discontinued. Outstanding Land Reclamation Financial Guarantees
will remain in effect until released under §§
86.170-86.172 and §§
86.174 and
86.175 (relating to standards for
release of bonds; and schedule for release of bonds).
Notes
The provisions of this § 86.162b issued under section 5 of The Clean Streams Law (35 P. S. § 691.5); sections 4(a) and 4.2 of the Surface Mining Conservation and Reclamation Act (52 P. S. §§ 1396.4(a) and 1396.4b); and section 1920-A of The Administrative Code of 1929 (71 P. S. § 510-20).
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