Office of Inspector General

Audit Report

RCRA

RCRA FINANCIAL ASSURANCE FOR 

CLOSURE AND POST-CLOSURE

2001-P-007

March 30, 2001 
Inspector General Division(s)

 Conducting the Audit

Headquarters Audit Division

 Washington, DC

 Virginia Roll

 Barry Parker

 Cathleen Meeks

 Susan Barvenik

 Josephine Smidt

 Mike Prater

Region(s) covered Region 1 (Connecticut)

Region 2 (New York)

Region 3 (Virginia)

Region 4 (Alabama)

Region 5 (Ohio)

Region 6 (Texas)

Region 7 (Missouri)

Region 9 (California)

Region 10 (Washington)

Program Office(s) Involved Office of Solid Waste and Emergency Response

 Office of Solid Waste
MEMORANDUM

SUBJECT: RCRA Financial Assurance for Closure and Post-Closure

Audit Report No. 2001-P-007

FROM: M E Prater

Mike Prater, Audit Manager

 Headquarters Audit Division

TO: Michael H. Shapiro, Acting Assistant Administrator

 Office of Solid Waste and Emergency Response 

Attached is the subject report for our review of RCRA financial assurance for closure and

post-closure care. This report contains findings that describe problems the Office of Inspector

General (OIG) has identified and corrective actions the OIG recommends. This audit report

represents the opinion of the OIG and the findings contained in this audit report do not necessarily

represent the final EPA position. Final determinations on matters in this audit report will be made

by the EPA managers in accordance with established audit resolution procedures. Accordingly,

the findings described in the audit report are not binding upon EPA in any enforcement

proceeding brought by EPA or the Department of Justice. 

During the exit conference, and in your response to the draft report for this review, your

office provided corrective actions, with milestone dates where applicable, for most of the

recommendations. Your response, which is included as Appendix V, also indicates that

ASTSWMO has requested that EPA discuss the report and your response to our

recommendations at their April 18 and 19 mid-year meeting. For any planned actions and

milestones that are developed as a result of the meeting, we would appreciate an updated

response within 90 days of the report date. When we receive the updated information, we will

determine whether to close this report in our tracking system.

Appendix VI of this report identifies the report distribution. We have no objections to the

further release of this report to the public. Should you or your staff have any questions about this

report, please contact Virginia Roll of my staff on (202) 260-5101, or Carol Jacobson, Audit

Liaison, on (202) 260-7604.

Attachment
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Report No. 2001-P-007

EXECUTIVE SUMMARY

INTRODUCTION Congress enacted the Resource Conservation and Recovery

Act in 1976 to ensure proper management of the huge

quantities of waste generated each year. Hazardous waste

treatment, storage, and disposal facilities regulated under the

Act must develop a plan for closing their facilities when they

no longer treat, store, or dispose of waste. To assure that

funds will be available to pay for the potentially costly facility

closure, facilities are required to meet certain financial

assurance requirements. Regulations also require financial

assurance for post-closure care of hazardous waste landfills,

involving such activities as maintenance and groundwater

monitoring. Similar requirements apply to Municipal Solid

Waste Landfills. Financial assurance regulations were

developed by the U.S. Environmental Protection Agency

(EPA) but are primarily implemented by states. 

OBJECTIVES The overall objective of our audit was to determine whether

financial assurance requirements and the implementation of

those requirements provided adequate funding for facility

closure and post-closure activities. We found many cases

where financial assurance mechanisms appeared to be

working as intended. However, in some cases, financial

assurance might not provide adequate funding to ensure the

facilities will not pose a threat to human health and the

environment. We specifically considered the following four

questions.

 C Does captive insurance satisfy requirements for

closure and post-closure financial assurance?

 C What are the risks that funds from financial assurance

mechanisms will not be available when needed?

 C Are funds being assured to cover the full period of

necessary post-closure monitoring and maintenance?

 C What can be done to improve the review process for

closure and post-closure cost estimates? 
ii Report No. 2001-P-007

RESULTS IN BRIEF We concluded that insurance policies written by captive

insurance companies do not provide an adequate level of

financial assurance for closure and post-closure. Most

captive insurance companies are wholly owned subsidiaries

in the corporation of the company they are insuring, and the

financial strength of the captive is dependent upon the parent

corporation. Therefore, if a parent company experiences

financial difficulties, there is insufficient assurance that the

captive insurance company will be able to provide needed

closure and post-closure funds.

Although the Agency has analyzed potential failure rates for

various financial assurance mechanisms, these analyses did

not include all significant risk factors. Therefore, the risks

that funds will not be available when needed from financial

assurance mechanisms – such as insurance, surety bonds, and

trust funds – may be higher than EPA estimated. Mechanism

failures can result in significant closure and post-closure

delays. And may result in federal or state governments

assuming the financial burden. 

There is insufficient assurance that funds will be available in

all cases to cover the full period of landfill post-closure

monitoring and maintenance. Regulations require postclosure activities and financial assurance for 30 years after

landfill closure, and a state agency may require additional

years of care if needed. We were told by several state

officials that many landfills may need more than 30 years of

post-closure care. However, most of the state agencies in

our sample had not developed a policy and process to

determine whether post-closure care should be extended

beyond 30 years, and there is no EPA guidance on

determining the appropriate length of post-closure care. 

Some facilities have submitted cost estimates that were too

low, and state officials have expressed concerns that the cost

estimates are difficult to review. To improve the review

process, software is available that can help state programs

review cost estimates submitted by facilities. Several states

contacted were unaware of the software and relied on

reviewers’ judgment to evaluate estimates.

 
iii Report No. 2001-P-007

RECOMMENDATIONS We recommended that EPA’s Acting Assistant

Administrator for Solid Waste and Emergency Response

provide specific guidance regarding insurance matters related

to financial assurance, further develop existing financial

assurance training materials, and facilitate the exchange of

financial assurance information through an Internet bulletin

board. We also recommended that, as resources allow,

criteria be developed for the appropriate post-closure care

time frames. Furthermore, we recommended that EPA help

states obtain software for reviewing closure and post-closure

cost estimates. 

AGENCY RESPONSE We received the Agency’s response to our draft report on

March 27, 2001. OSWER agreed with all of our

recommendation. 

 
iv Report No. 2001-P-007

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v Report No. 2001-P-007

TABLE OF CONTENTS

Page

EXECUTIVE SUMMARY ..................................................... i

ABBREVIATIONS ......................................................... vii

CHAPTER 1: INTRODUCTION ............................................... 1

Purpose ............................................................. 1

Background .......................................................... 2

Scope and Methodology ................................................ 5

Prior Audit Coverage ................................................... 7

CHAPTER 2: EFFECTIVE FINANCIAL ASSURANCE 

MECHANISMS ARE NECESSARY ...................................... 9

Corporate Financial Test Was Designed to Exclude High Risk Firms .............. 10

Independence of Events is Important for Third Party Mechanism Risk ............. 11

Independence of Events is Lacking with Captive Insurance ..................... 12

Regulations Not Met by Captive Insurance Policies ........................... 14

States Are Concerned About the High Risk of Captive Insurance ................. 14

Reinsurance May Involve a Captive Insurance Company ....................... 16

Insurance May Be Difficult to Evaluate and Monitor .......................... 17

Assurance Risk for Some Surety Bonds May Be Higher Than Intended ............ 18

Trust Funds Present Risks Aside from Bank Failure Risk ....................... 21

Some Problems Found with Letters of Credit ................................ 21

Complexities in Overseeing the Financial Test ............................... 22

Over One-Third of Sample Used Financial Test/Corporate Guarantee ............. 24

Nineteen Percent in Sample Had No Financial Assurance ....................... 24

Local Government Financial Test Highest Percentage in MSWLF Survey ........... 24

Conclusions ......................................................... 26

Recommendations .................................................... 27

CHAPTER 3: FINANCIAL ASSURANCE MAY BE NEEDED BEYOND

THE 30-YEAR POST-CLOSURE PERIOD ................................ 29

RCRA Landfill and Post-Closure Care Requirements .......................... 29

Hazardous Waste Treatment Standards .................................... 30

Lack of Criteria for Extending Post-Closure Period ........................... 31

Need for Continuing Post-Closure Care Beyond 30 Years ...................... 33

State Implementation of Post-Closure Requirements .......................... 35
vi Report No. 2001-P-007

Significant Expenditures May Be Required for Extended Post-Closure Care ........ 39

No Strategy Developed to Address GAO Concerns ........................... 41

Study Conducted on Subtitle D Facilities ................................... 41

Conclusions ......................................................... 43

Recommendations .................................................... 44

CHAPTER 4: ACCURATE COST ESTIMATES ARE 

NECESSARY FOR FINANCIAL ASSURANCE ............................ 45

EPA Region IV Studies Show That Facilities Underestimate Costs ............... 46

Region IV’s Improvements to the Cost Estimating Process ..................... 46

Feedback from Users of Cost Estimating Software ............................ 47

States Need to Be Informed About Cost Estimating Software ................... 48

Conclusions ......................................................... 48

Recommendations .................................................... 49

APPENDIX I

SAMPLING METHODS AND DATA .................................... 51

APPENDIX II

FINANCIAL TEST REQUIREMENTS ................................... 53

APPENDIX III

DISTRIBUTION OF FINANCIAL ASSURANCE MECHANISMS

FOR HAZARDOUS WASTE LANDFILLS IN POST-CLOSURE .............. 57

APPENDIX IV

DISTRIBUTION OF FINANCIAL ASSURANCE MECHANISMS 

FOR ACTIVE MUNICIPAL SOLID WASTE LANDFILLS .................... 59

APPENDIX V

AGENCY RESPONSE ................................................ 61

APPENDIX VI

REPORT DISTRIBUTION ............................................. 65
vii Report No. 2001-P-007

ABBREVIATIONS

ASTSWMO 

EPA or Agency

GAO

LDR

MPCA

MSWLF

OSWER

RCRA

RCRIS

TSDF

Association of State and Territorial Solid Waste Management Officers

U. S. Environmental Protection Agency

General Accounting Office

Land Disposal Restrictions

Minnesota Pollution Control Agency

Municipal Solid Waste Landfill

Office of Solid Waste and Emergency Response

Resource Conservation and Recovery Act

Resource Conservation and Recovery Information System

Treatment, Storage, and Disposal Facility
viii Report No. 2001-P-007

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1 Report No. 2001-P-007

CHAPTER 1

INTRODUCTION 

Purpose Before the Resource Conservation and Recovery Act

(RCRA) was enacted in 1976, many cases of environmental

damage occurred when hazardous waste facilities were

abandoned by their owners. In recognition of this problem,

the U. S. Environmental Protection Agency (EPA or

Agency), under its authority granted by RCRA, established

requirements on owners and operators for proper closure

and post-closure care of hazardous waste treatment, storage

and disposal facilities (TSDF). Financial responsibility is one

of the requirements. Therefore, since the early 1980s,

owners and operators of TSDFs have been required to

establish financial assurance that funds will be available to

properly close a TSDF and perform any necessary postclosure activities in the event that the owner or operator is

unwilling or unable to conduct these activities. Financial

assurance requirements were later extended to owners and

operators of municipal solid waste landfills (MSWLF).

Two Division Directors in EPA’s Office of Solid Waste

suggested that the Office of Inspector General conduct an

audit on financial assurance issues. The overall objective of

our audit was to determine whether financial assurance

requirements and the implementation of those requirements

provide adequate funding for facility closure and postclosure activities. Under the objective, this audit addresses

the following questions.

C Does captive insurance satisfy requirements for

closure and post-closure financial assurance?

C What are the risks that funds from financial assurance

mechanisms will not be available when needed?

C Are funds being assured to cover the full period of

necessary post-closure monitoring and maintenance?
2 Report No. 2001-P-007

C What can be done to improve the review process for

closure and post-closure cost estimates? 

Background Congress enacted RCRA to ensure the proper management

of the huge quantities of waste generated in the nation each

year. Under RCRA Subtitle C, EPA promulgated

regulations for managing hazardous wastes from generation

to disposal. Under RCRA Subtitle D, EPA promulgated

regulations that apply to solid wastes that are not defined as

hazardous or are excluded from Subtitle C regulations. 

RCRA required EPA to develop standards for new

hazardous waste TSDFs built after RCRA was enacted and

for those TSDFs that were already in operation when RCRA

requirements became effective (interim status facilities). To

handle hazardous waste, a new TSDF must obtain a permit

before it begins operating. Standards for interim status

facilities are often similar to standards for new facilities. 

However, there are some circumstances where it would not

be practical for an existing facility to immediately implement

the requirements that a new facility must implement. 

Therefore, interim status regulations are designed to allow

TSDFs, already in operation, time to implement requirements

for permitted facilities. 

Both interim status and permitted TSDFs are required to

develop a plan for closing their facilities when they no longer

treat, store or dispose of hazardous waste. Facility closure

requirements are potentially costly. To assure that funds are

available to pay for closure, TSDFs are required to meet

certain financial assurance requirements. Owners and

operators of land disposal facilities are also required to

establish a plan and financial assurance for post-closure care. 

During the post-closure care period, activities are conducted,

such as maintenance and ground-water monitoring, to

preserve the integrity of the disposal system and detect

releases of hazardous waste.

Owners and operators of TSDFs can demonstrate that funds

are available to pay for closure and post-closure through one

or a combination of the following financial assurance

mechanisms.
3 Report No. 2001-P-007

C Trust Fund - If a trust fund is used, owners and

operators are required to deposit money according to

a phased-in schedule (known as a pay-in period). At

the end of the pay-in period, the facility should have

enough money set aside to cover its financial

assurance requirements.

Under some of the other mechanisms (surety bonds and

letters of credit), owners and operators must establish a

standby trust fund. No money is deposited into the standby

trust fund unless funds must be withdrawn from the

mechanism. In that case, funds from the mechanism are

deposited in the standby trust fund and used to cover the

respective costs. 

C Surety Bond - A surety bond guarantees that closure

and post-closure obligations will be fulfilled. There

are two types of surety bonds:

Payment Bond - In the event an owner or

operator fails to fulfill closure and postclosure requirements, a payment bond funds a

standby trust fund in the amount equal to the

face value of the bond.

Performance Bond - A performance bond

guarantees performance of closure and postclosure requirements. A performance bond

can also be paid into a standby trust fund. 

Interim status facilities may not use

performance bonds.

C Letter of Credit - A letter of credit is a credit

document, issued to a TSDF by a financial institution,

covering the costs of closure and post-closure. 

C Insurance - The owner or operator of a TSDF may

take out an insurance policy to cover the costs of

closure and post-closure.

C Corporate Financial Test - If a facility meets

corporate financial test criteria, it may satisfy

financial assurance obligations solely on the strength

of its financial condition. (For more information on
4 Report No. 2001-P-007

Subtitle C corporate financial test requirements,

please see the following chapter and Appendix II.)

C Corporate Guarantee - A facility which is not able

to meet corporate financial test criteria may arrange a

corporate guarantee by demonstrating that its

corporate parent, sibling corporation, or firm with a

substantial business relationship with the owner or

operator, meets the financial test requirements on its

behalf.

MSWLFs are also required to establish plans and financial

assurance for closure and post-closure care of the landfill. 

MSWLFs may establish financial assurance for closure and

post-closure through either one or a combination of the

above mechanisms or through additional mechanisms

allowed under Subtitle D regulations. However,

requirements for the Subtitle D corporate financial test are

somewhat different from Subtitle C requirements. (Please

see Appendix II for more details on Subtitle D corporate

financial test requirements.) Subtitle D regulations also

allow a local government financial test, local government

guarantee, state assumption of responsibility, and additional

state-approved mechanisms. Under some circumstances,

state assumption of responsibility and additional stateapproved mechanisms might also apply to Subtitle C

facilities.

C Local Government Financial Test - As in a corporate

financial test, a MSWLF owned by a local

government can fulfill financial assurance

requirements for some or all of its obligations by

meeting local government financial test requirements. 

A local government which satisfies the financial test

requirements may also guarantee financial assurance

for a MSWLF it does not own or operate. 

C State Assumption of Responsibility - When the state

assumes responsibility for MSWLF financial

assurance, the State Director either assumes legal

responsibility for closure and post-closure or assures

the availability of funds from state sources for those

requirements.
5 Report No. 2001-P-007

C Additional State-Approved Mechanisms - The State

Director of an approved state program may allow

additional mechanisms if they meet performance

criteria specified in the Subtitle D regulations. In

brief, a state-approved mechanism must be legally

valid, binding, and enforceable under state and

federal law and ensure that sufficient funds will be

available in a timely fashion for costs of closure and

post-closure.

TSDFs are also required to establish financial assurance for

bodily injury and property damage liabilities. In addition,

financial assurance may be required when the facility must

clean-up (perform RCRA corrective action) at a

contaminated hazardous waste site.

Financial assurance requirements under Subtitle C and

Subtitle D are primarily implemented by states. A state must

become authorized by EPA to implement RCRA Subtitle C

regulations. In order to become authorized, a state develops

and submits for approval a hazardous waste program which

is equivalent to and consistent with the federal program and

provides adequate enforcement. Under RCRA Subtitle D, as

amended by the Hazardous and Solid Waste Amendments of

1984, states are required to develop permitting programs or

other systems of prior approval to ensure MSWLFs comply

with federal criteria, which include financial assurance

requirements. EPA is required by RCRA to determine

whether the state MSWLF programs comply with the federal

criteria. Currently, most states are authorized for RCRA

Subtitle C financial assurance regulations and approved for

Subtitle D financial assurance programs. Since requirements

for Subtitle C and Subtitle D financial assurance are often

similar, the discussions in this report apply to both Subtitle C

and Subtitle D facilities unless otherwise indicated.

 

Scope and Methodology The Office of Inspector General conducted the fieldwork for

this assignment from September 1999 through January 2001. 

This audit was performed in accordance with the

Government Auditing Standards (1994 Revision) issued by

the Comptroller General of the United States as they apply to

performance audits. We restricted our scope to financial

assurance for Subtitle C and Subtitle D facility closure and

post-closure. Therefore, we did not do audit work on any
6 Report No. 2001-P-007

issues exclusively associated with financial assurance for

corrective action or bodily injury and property damage. We

primarily concentrated audit work on the mechanisms that

Subtitle C and Subtitle D facilities have in common. 

 To accomplish our objectives, we reviewed the applicable

RCRA statute and regulations, as well as guidance and

policy documents issued by EPA. We interviewed EPA

officials in the Office of Solid Waste, the Office of

Enforcement and Compliance Assurance, and EPA Regions. 

We reviewed federal and state program internal controls

relative to program operations and compliance with laws and

regulations. We selected nine states for our review:

Alabama, California, Connecticut, Missouri, New York,

Ohio, Texas, Virginia, and Washington. We chose these

states to obtain a broad national understanding of financial

assurance issues. We visited RCRA financial assurance state

programs in California, Connecticut, and Texas, where we

interviewed officials and conducted file reviews. Based on

work conducted in the three states, we developed

questionnaires and spreadsheets to collect opinions and data

from the nine state programs on financial assurance for

Subtitle C and D facilities. We also conducted phone

interviews with officials in the states. Data collected

included information relative to the states’ experiences with

financial assurance.

We selected a statistical sample of Subtitle C facilities from a

nine-state subset population in the Resource Conservation

and Recovery Information System (RCRIS) post-closure

universe. The nine states listed above were chosen for the

subset population. Data from these states represented

approximately 40 percent of the RCRIS post-closure

universe. We further restricted the population to privately

owned Subtitle C facilities in post-closure which were

expected to have established financial assurance. Since we

drew the sample from the nine-state subset population, our 

projections were made to the population of nine states rather

than to individual states. RCRIS does not contain data on

financial assurance, and we only relied on RCRIS for its list

of facilities in post-closure from which we drew our sample. 

We did not conduct a review of RCRIS internal controls. 

We also obtained data on active MSWLF in seven of the
7 Report No. 2001-P-007

above states. (For further information on sampling methods

and data, please see Appendix I.) 

We reviewed the Agency’s performance measures

established under the Government Performance and Results

Act of 1993. Financial assurance for closure and postclosure is required for RCRA-permitted facilities which are

tracked as part of Goal 5, established for Better Waste

Management.

Prior Audit Coverage There have been no prior Office of Inspector General audits

on RCRA financial assurance. We reviewed the General

Accounting Office (GAO) report, Hazardous Waste:

Funding of Postclosure Liabilities Remains Uncertain, June

1990, which includes discussions of financial assurance and

post-closure care. GAO stated that although EPA was

aware of the potential for future releases from disposal

facilities, it had not yet developed a strategy for addressing

these long-term post-closure concerns. GAO stated that

long delays in the evaluation of the effectiveness of current

waste disposal requirements have the potential to result in

another Superfund situation in future years.
8 Report No. 2001-P-007

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1

Financial assurance requirements for Subtitle C and Subtitle D are often similar. Therefore, in this

report, unless otherwise indicated, the discussion applies to both Subtitle C and Subtitle D mechanisms.

9 Report No. 2001-P-007

CHAPTER 2

EFFECTIVE FINANCIAL ASSURANCE 

MECHANISMS ARE NECESSARY

Effective financial assurance mechanisms1 are necessary to

ensure that closure and post-closure activities will be

conducted when needed to protect human health and the

environment. We found many cases where RCRA financial

assurance mechanisms appear to be working as intended. 

However, we found cause for concern about some

mechanisms. Since there is some risk of failure for any

financial assurance mechanism, the Agency developed

criteria designed to reduce mechanism failure rates to a low

level. While the Agency has analyzed potential failure rates

for various financial assurance mechanisms, the analyses

cannot always be relied on because they did not include all

significant risk factors. Therefore, some financial assurance

mechanisms may have failure risks that are higher than the

Agency finds acceptable. Furthermore, because of

insufficient EPA guidance and the complexities of insurance,

captive insurance policies have not always been sufficiently

evaluated to determine whether they meet regulatory

requirements. 

Financial assurance mechanism failures that occur when a

facility owner or operator is insolvent can result in significant

closure and post-closure delays, increasing the likelihood of

environmental contamination and adverse human health

effects. Moreover, when these failures occur, federal or

state funds may have to be diverted from other public

priorities since EPA or the state (and ultimately the general

public) would become financially responsible for closure and

post-closure.
10 Report No. 2001-P-007

Corporate Financial Test RCRA regulations allow a facility which meets corporate

Was Designed to Exclude financial test requirements to satisfy financial assurance High

Risk Firms obligations solely on the strength of its financial condition

and without establishing a third party mechanism or trust

fund. Although there is some risk of failure for firms which

pass the corporate financial test, the test is meant to reduce

the risk to a low level by screening out firms with higher

risks of failure. Since the risk of bankruptcy increases when

a firm’s net worth decreases, firms are required to have a

minimum of $10 million in tangible net worth to pass the

corporate financial test. The Agency has determined that

firms with less than $10 million in tangible net worth went

bankrupt four times more frequently than firms with tangible

net worth greater than $10 million. Net worth is not the only

corporate financial test requirement. Additional

requirements include financial ratios or bond ratings, which

make the test more difficult to pass than the net worth

requirement alone. (For more details on corporate financial

test requirements for Subtitle C and Subtitle D facilities,

please see Appendix II.) 

Regulations also require annual updates of the financial test

to determine whether or not a firm’s financial health has

deteriorated because the Agency believes the financial test

might not be a good long-term predictor of solvency. In our

sample of facilities, we found examples of facilities which

had established financial assurance through the corporate

financial test and in a later year no longer qualified. EPA or

a state program may also require reports of financial

condition at any time during the year there is a reasonable

belief that the owner or operator no longer meets financial

test requirements. Federal regulations allow financial test

requirements to be met on behalf of a TSDF or MSWLF

through a corporate guarantee by another firm, such as a

corporate parent, sibling, or one that has a substantial

business relationship with the TSDF or MSWLF. The firm

providing the corporate guarantee becomes responsible for

closure and post-closure in the event of TSDF or MSWLF

financial failure. 

A firm using the financial test to satisfy obligations cannot

guarantee it will have funds for closure and post-closure in

the event that it becomes insolvent. For conducting closure

and post-closure, the public bears the risk of the firm’s
2 Assurance risk, which is the risk of concern to the Agency, is defined as “the risk of failure of financial

assurance mechanisms to provide funds for environmental obligations in a timely manner.”

3

Events are said to be independent if the occurrence of one event does not affect the probability of the

occurrence of the other event. When there is independence of events, the risk of both events occurring at the same

time is calculated by multiplying the separate risks together.

11 Report No. 2001-P-007

insolvency. A facility which cannot pass the corporate

financial test must establish an alternate mechanism because

the facility’s risk of financial failure, and therefore the

public’s risk, is too high. Since the Agency excludes higher

levels of assurance risk2 through the requirements of the

corporate financial test, this implies that use of an alternate

financial assurance mechanism should present no more risk

to the public than the corporate financial test. However,

there is evidence that some currently allowed alternate

mechanisms may present assurance risks higher than the

corporate financial test risk. (There is further discussion

about the financial test later in this chapter.)

Independence of Events is For a third party mechanism to be effective in providing

Important for Third Party financial assurance, there must be independence between

Mechanism Risk the risk of facility failure and the risk that the company

providing the mechanism will fail. Moreover, Agency

calculations of third party mechanism risks assumed these

risks were independent. However, the Agency did not take

into consideration cases where there is a lack of

independence between risks of facility financial failure and

third-party financial failure.

The risk to the public of the corporate financial test depends

on the financial strength of the firm. When a third party

mechanism is used to establish financial assurance, the risk of

facility failure is transferred to the company providing the

mechanism, and the public risk is that the facility will become

insolvent and the third party mechanism will also fail. If the

risks of failure are independent,3 the risk to the public that a

facility and the company providing the third party mechanism

(such as a bank or insurance company) will be insolvent at

the same time is lower than either the risk of facility

insolvency or the risk of insolvency of the company

providing the third party mechanism. For example, a TSDF

might establish financial assurance with an insurance policy. 

The estimated risk, in this case, that the TSDF will become
4

Events are positively correlated when the occurrence of one event increases the probability of the

occurrence of the other event.

12 Report No. 2001-P-007

insolvent and the insurance company will fail at the same

time is significantly lower than either the risk of TSDF

insolvency alone or the risk of insurance company failure

alone if the two risks are independent. 

If TSDF insolvency and insurance company failure are not

independent and are positively correlated,4 the overall risk

increases and may be as high as the risk of TSDF insolvency. 

If the TSDF does not meet corporate financial test

requirements, this overall risk could be higher than the failure

risk presented by a facility which passes the corporate

financial test.

Independence of Events is We believe that insurance policies issued by a “captive”

Lacking with Captive Insurance insurance company do not provide an adequate level of

assurance because we found no independence between

facility failure and failure of the mechanism. Most captive

insurance companies are “pure” captives, wholly owned

subsidiaries controlled by the parent company and

established to insure the parent company or its other

subsidiaries. Captive insurance policies have been used to

establish financial assurance for many TSDFs and MSWLFs. 

Even though the captive may be a legally separate

corporation, the financial strength of the captive is dependent

upon the parent corporation. Therefore, the requirement

that captives maintain a certain level of assets does not

provide assurance of funds for closure and post-closure. For

example, a significant portion of the assets of one captive,

established by a large waste management firm, was

represented by a note receivable from the parent company. 

Because of the financial relationship between a captive

insurance company and its parent corporation, A. M. Best,

which provides ratings of insurance companies, evaluates

captives based on the financial strength of the parent

company. 

Therefore, the risk of insolvency of a captive insurance

company and the risk of insolvency of a facility insured by a

captive are not independent but instead are positively

correlated. Since the failure of one is closely tied to the
13 Report No. 2001-P-007

failure of the other, the assurance risk of using a captive

insurance policy would be too high if the insured facility or

the captive cannot pass the financial test. In addition to the

higher potential risk in allowing a firm which cannot initially

meet financial test requirements to use a captive to “selfinsure,” there is no annual review of the firm’s financial

condition by the state agency as there is for a financial test or

corporate guarantee. 

The basic purpose of insurance is to distribute risks among

different parties. Typically an insurance company works to

diversify its risks by insuring many entities. Independence of

events is also important for diversifying insurance risks. For

example, when an insurance company provides fire insurance

for several buildings in one city block, it may be ruined if a

large fire destroys all the buildings on the block. When

captive insurance is used for RCRA financial assurance, there

is no diversification of risks and no independence of the

events of facility insolvencies because the facilities are all

part of the same corporation. 

The Internal Revenue Service ruled that the “parent

corporation and its domestic subsidiaries, and the wholly

owned ‘insurance’ subsidiary [a captive insurance company]

though separate corporate entities, represent one economic

family with the result that those who bear the ultimate

economic burden of loss are the same persons who suffer the

loss....” A report issued by the Minnesota Pollution Control

Agency (MPCA) listed several reasons for concern about

captives. Because “the captive and the parent company are

one of the same” and the “captive insurance company is not

an independent entity or impartial third party,” the MPCA’s

staff expressed the concern that captive insurance “may be

nothing more than a promise to guarantee future coverage of

financial assurance requirements.” 

Because the captive and its insured facility are members of

the same economic family, a captive insurance policy

establishes financial assurance in the same manner as the

corporate financial test without safeguards, such as the $10

million net worth and financial ratio or bond rating

requirements. RCRA regulations do not specifically address

the use of captive insurance for closure and post-closure

financial assurance, although there are some regulatory
14 Report No. 2001-P-007

requirements for insurance policies in general. We were told

there are few RCRA regulatory requirements on insurance

established for financial assurance because insurance is

primarily regulated by states. 

Regulations Not Met by An insurance policy established for closure and postCaptive Insurance Policies closure must contain a provision allowing assignment of the

policy to a successor owner or operator of the facility. The

captive insurance policies in our sample would not meet this

requirement. The policies were issued by a pure captive

which was established to insure the parent company or its

other subsidiaries. The state which licensed the captive

insurance company and other states which license captives,

restrict captive insurance companies from insuring companies

outside of the corporate family. In some states, a captive

might be allowed to insure an unaffiliated company with an

“existing contractual relationship.” For example, if the new

owner or operator was involved in a joint venture with the

facility being sold, the state might allow the policy to be

transferred to the new owner or operator. This would have

to be determined by the state on a case-by-case basis when

the facility is sold. However, the policies in our sample

cannot satisfy the provision allowing assignment of the policy

to a successor owner or operator. Therefore, captive

policies do not meet all financial assurance regulations. In

some state programs where captive insurance policies for

closure and post-closure were denied, the issue of

assignment of the policy was one of the reasons for denying

the captive policy. However, other state officials who

expressed concerns about the risks of captive insurance for

closure and post-closure did not seem to be aware of the

assignment problem. 

States Are Concerned About the In some states, serious concerns about captive insurance

High Risk of Captive Insurance have resulted in decisions to deny captive insurance policies

for financial assurance on a case-by-case basis. For Subtitle

C facilities, two states said they would allow captive

insurance only if financial test requirements were satisfied. 

In addition, one state in our nine state sample, Virginia, has

recently passed legislation which disallows captive insurance

for RCRA financial assurance. In California, a regulation

disallowing captive insurance for MSWLF is being proposed. 

In states that allow captive insurance, state program officials

have expressed concerns about the risk of captive insurance
15 Report No. 2001-P-007

and whether they have the authority to disallow a policy

issued by a captive. Moreover, insurance certificates and

policies do not indicate whether or not the insurance has

been issued by a captive, and there are concerns about the

difficulty of identifying a captive insurance policy. We found

one case where the state program was unaware that

insurance for financial assurance had been issued by a

captive.

The following table summarizes the responses we received

from state officials on captive insurance in their states. 

Table 2.1

Captive Insurance for Financial Assurance 

State Responses

STATE

Subtitle C Subtitle D

Allowed Denied Allowed Denied

Alabama* X

California X X

Connecticut X** X

Missouri X** X

New York X S**

Ohio X X

Texas X X

Virginia X X

Washington X** X**

 S Would be subject to review and probably denied

 * Alabama legislature has not passed the necessary legislation and therefore, does not have a 

 Subtitle D financial assurance program.. However, we were told that EPA Region IV will be 

 working with the Alabama Department of Environmental Management to facilitate adopting 

 financial assurance requirements. 

 ** No captive insurance policies for RCRA financial assurance have been identified
16 Report No. 2001-P-007

Reinsurance May Involve a An insurance policy issued by an independent licensed

Captive Insurance Company insurance company may involve a captive insurance 

company through reinsurance. In this type of reinsurance

arrangement there may be a lack of independence between

facility insolvency and insurance company failure. 

Reinsurance occurs when the original insurer becomes an

insured (or reinsured) by a contract with another insurance

company (reinsurer). For example, an insurer might want to

reduce or eliminate its current potential liability for losses by

taking out liability insurance with another insurance company

(the reinsurer) to indemnify itself against liability on its own

policies. This may be beneficial when the risk is spread to

another independent licensed insurance company. 

However, in one form of reinsurance, known as “fronting” in

the insurance industry, the risk may be spread to a captive

insurance company. Fronting insurance arrangements are

legal in most states. In a fronting arrangement involving a

captive, an independent commercial insurance company

would issue the policy, and the captive would become the

reinsurer and reimburse the independent insurance company

for any claims paid by the independent insurance company. 

The fronting insurance company (original insurer) is

ultimately responsible for the liability if the captive cannot

meet its reinsurance obligation. Moreover, the fronting

company can require the captive insurance company to

collateralize the captive’s obligation for reinsurance. 

However, if the facility and its captive become insolvent and

the collateral does not cover the reinsurance obligation, the

fronting company may experience financial problems

especially if more than one facility in the same corporation is

insured through a fronting arrangement. Since the risk is not

adequately diversified, there is a potential for insurance

company failure, as in the fire insurance block fire example

on page 14. In this case, the risk that the public will have to

fund closure and post-closure may be unacceptably high

because there would not be independence between the risk of

facility insolvency and insurance company insolvency. 

Since there is no requirement that fronting arrangements

have to be disclosed in an insurance certificate or policy, a

state agency might not be informed when there are fronting

arrangements used to establish financial assurance. State

officials we contacted did not know whether or not fronting
17 Report No. 2001-P-007

arrangements involving captives had been established for

financial assurance for the facilities in our sample. However,

at least one insurance company providing insurance for

RCRA financial assurance advertises on the Internet that it

offers fronting arrangements. Disclosure of fronting

arrangements in insurance certificates and policies could help

state financial assurance programs be more effective in

evaluating assurance risks and whether the policies comply

with regulations. The National Association of Insurance

Commissioners adopted a Model Law in 1993 requiring

disclosure of fronting arrangements and disclosure of the

amount of collateral established for the obligation. However,

to date this legislation has not been adopted by any state.

 

Insurance May Be Difficult When insurance is the mechanism, a state program may be

to Evaluate and Monitor presented with a number of additional complex issues, e.g.,

policy terms and exclusions inconsistent with regulations,

potential litigation, late or missing cancellation notices, and

whether the insurer is qualified to write insurance in the

state. Since insurance is primarily regulated by states,

differences in state insurance regulations contribute to the

complexities in evaluating insurance policies. As a result,

insurance can be difficult to evaluate and monitor. We were

told that the lack of a standardized insurance policy form for

financial assurance adds to the difficulty. One state program

found it necessary to create a team with legal expertise to

evaluate insurance policies for RCRA financial assurance. 

Officials from another state told us they rely on the insurance

certificate which must be signed by an authorized

representative of the insurance company. RCRA regulations

require the insurance certificate to state that “any provision

of the policy inconsistent with such regulations is hereby

amended to eliminate such inconsistency.”

Some insurance policies, issued for financial assurance,

require the insured facility to reimburse the insurance

company for any claims that are paid by the insurance

company for closure and post-closure. This is also known as

a fronting arrangement. We were told that, in this type of

policy, the insurance company would be liable if the facility

owner or operator became unable to conduct closure or

post-closure. One state commented that failure of an

insurance company to collect deductibles, i.e.,

reimbursements, on a large number of such policies may have
18 Report No. 2001-P-007

an impact on the insurance company’s ability to perform. 

The risk of insolvency of an insurance company might

increase when it issues this type of policy. If a significant

number of such policies are issued to facilities owned by one

waste management company, the risk of insurance company

failure may not be independent from the risk of insolvency of

the waste management company. Another concern is the

difficulty in evaluating these policies to determine whether

they comply with financial assurance regulations.

In spite of insurance certificates which provide a warrant that

policies conform with regulations, policy terms and

exclusions may make it difficult for states to obtain closure

and post-closure funds from insurance policies without

litigation. Some officials mentioned their concern that

litigation with insurance companies might sometimes be

necessary. Another problem mentioned to us during our

audit was insurance policy cancellations which were not

reported to the state program. We were told by a state

official that in some cases, facilities would obtain insurance

policies for financial assurance and later cancel the policies

without informing the state program. The insurance

companies involved also did not inform the state of the

cancellations.

In August 2000, the Agency submitted a proposed rule to

the Office of Management and Budget which requires

insurance companies issuing policies for RCRA financial

assurance to have a high rating from insurance company

raters. EPA could help states further in developing solutions

to insurance problems. State officials told us they would like

more training and guidance from EPA on insurance and on

other mechanisms as well. They also said that better

communication among states would be helpful. To assure

low assurance risk when insurance is the mechanism and that

policies comply with regulations, EPA should investigate

complex insurance issues with states to determine states’

need for guidance. 

Assurance Risk for Some Agency calculations of assurance risk for surety bonds were

Surety Bonds May Be based on predictions of firm bankruptcies and surety

Higher Than Intended company insolvencies. However, these calculations did not

take into consideration litigation risk or the potential for lack

of independence of risks. When a surety bond is the
19 Report No. 2001-P-007

mechanism for RCRA financial assurance, the state may have

to litigate to obtain the funds. In one case, years of litigation

took place when an insurance company refused to comply

with the terms of a performance bond for facility closure. A

surety bond is usually issued by an insurance company. 

However, surety bonds are not insurance, and the surety

company becomes liable for closure and post-closure only

when the owner or operator fails to comply with closure or

post-closure requirements. In this case, the state agency was

finally awarded the full amount of the bond plus interest,

$2,400,000. Delays and resources spent on litigation in

cases like this have negative effects on environmental

programs and results. 

There are controls imposed by federal regulations on surety

bonds. The surety company issuing a bond for RCRA

financial assurance must be on the U.S. Treasury Circular

570 list of acceptable sureties. The Surety Bond Branch at

Treasury reviews quarterly and annual financial information

from surety companies on the list, and a surety company has

to meet financial requirements set by Treasury to stay on the

list. Furthermore, Treasury sets a limit on the amount

allowed on a bond issued by an authorized surety. Although

a surety authorized by Treasury can issue a surety bond and

then obtain reinsurance from an unauthorized surety

company, there are restrictions on the amount of reinsurance

allowed from an unauthorized surety. The amount of

reinsurance from an unauthorized surety plus the amount of

obligation retained by the authorized surety cannot go over

the bond limit Treasury sets for the authorized surety. 

Although there is a limit set by Treasury on each bond

issued, there is no limit on the overall total amount of surety

bonds issued by a surety to a company. If a surety issues a

large number of bonds to facilities in one corporation, the

surety bond risk might not be adequately diversified. This is

another case where the financial failure of the corporation

might have an impact similar to the block fire described on

page 10 and could cause serious financial problems for the

surety company. There may also be the reverse case where

the financial problems of the surety could contribute to the

financial problems of a corporation using surety bonds for

many facilities. A recent case illustrates this possibility. 
20 Report No. 2001-P-007

Recently a surety company which had issued bonds at a

competitive rate and with low collateral requirements to

many waste management companies was removed from the

Treasury Circular 570 list because it no longer met

Treasury’s financial criteria. A large national waste

management company entered Chapter 11 bankruptcy

shortly after the announcement about the surety company’s

removal from the list. The removal of this surety from the

Treasury list forced the waste management company to try

to replace financial assurance surety bonds issued by the

surety removed from the list. These surety bonds

represented approximately two-thirds of the financial

assurance obligation of the waste management company. 

Since replacement surety bonds were being offered at

significantly higher rates and required higher

collateralization, the removal of the surety company had a

financial impact on the waste management company and, we

believe, may have been one of the contributing factors to its

bankruptcy. In this case, there may have been insufficient

independence between the financial condition of the surety

company, and the financial condition of the waste

management company. 

Furthermore, the assurance risk, calculated by the Agency

for sureties, was based on the risk that a surety on the

Treasury list would become insolvent, rather than the risk

that the surety would be taken off the list. The risk of a

surety being removed from the Treasury list is higher than

the risk of failure calculated for firms with net worth less

than $10 million and seems to be the relevant risk for

financial assurance purposes. One state official suggested

the imposition of additional requirements on surety bonds

used for financial assurance, such as a limit on the total

amount of bonds from one surety issued to a company for

financial assurance. We believe this additional control would

help maintain independence of failure risks when surety

bonds are used for financial assurance. However, an EPA

official informed us that the Treasury Department interprets

its statute as disallowing additional federal requirements on

surety companies. More dialogue among financial assurance

program officials on this problem might be beneficial. 

 
21 Report No. 2001-P-007

Trust Funds Present Risks Regulations require that the trust operations of a trustee be

Aside from Bank Failure Risk regulated and examined by a federal or state agency. These

banks have a low risk of failure, and, as determined by

Agency analysis, a fully funded trust fund invested

conservatively has virtually no risk of failure. However, the

major risk appears to be that a trust fund will not be fully

funded when the facility becomes insolvent. In our Subtitle

C sample, there were a significant number of facilities that

went out of business or into bankruptcy with partially funded

trust funds. Of the partially funded trust funds in our sample

(please see the table in Appendix III, 25 percent were on

schedule with their funding requirements. However, 75

percent of this group were funded insufficiently when most

of the facilities experienced financial difficulties. Facilities in

interim status in the early 1980s had twenty years to fund a

trust fund. However, under Subtitle C, a permitted facility

must fully fund a trust fund over the remaining operating life

of the facility or over the term of the initial permit which is

limited to10 years, whichever is shorter. Two states, New

York and Missouri, reported they require trust funds to be

funded within 5 years. In addition, New York requires new

firms and revenue oriented facilities to fully fund trust funds

when they are established. However, regulations in New

York allow a pay-in period of up to ten years for MSWLFs. 

Another problem sometimes occurs with trust funds. 

According to Subtitle C regulations, banks may only release

funds from the trust on approval from EPA or the authorized

state program. However, we were given examples during

our audit where banks had released funds from trust funds to

Subtitle C facility owners without the required approval.

Some Problems Found We found some problems with letters of credit used to

with Letters of Credit establish financial assurance for RCRA closure and postclosure. In one sample case, a bank which had issued a letter

of credit for financial assurance failed. The letter of credit

was no longer in effect because, unlike a savings account, a

letter of credit is not guaranteed by the Federal Deposit

Insurance Corporation when a bank fails. However, this was

a minor problem because the facility, which was not

insolvent, was able to replace it with another letter of credit. 

The outcome in this case was the expected outcome when

there is independence of failure risks and illustrates the way

financial assurance should work. When the risks of
22 Report No. 2001-P-007

insolvency of the facility and the bank are independent, there

is a low probability that they will both fail at the same time. 

The letter of credit operations of a bank issuing a letter of

credit for financial assurance must be regulated and examined

by a federal or state agency. This requirement helps keep the

assurance risk of letters of credit at an acceptably low level. 

The MPCA report stated that a letter of credit is a good

financial assurance mechanism because it provides full

coverage and can be drawn on easily. Some disadvantages

mentioned were that the bank may choose not to renew the

letter of credit and the letter of credit is carried on the

facility’s financial statements as a liability, which reduces the

facility’s borrowing power. Subtitle C regulations allow the

EPA Regional Administrator or authorized state program to

draw on a letter of credit if the bank notifies the facility it

will not renew a letter of credit and the facility does not

obtain alternate financial assurance. There is no similar

provision in the Subtitle D regulations. However, some

states, e.g., New York, may have a similar provision for

Subtitle D facilities. 

Timely notifications on decisions not to renew are important. 

A state agency did not receive the required 120-day

notification from a bank that it was not renewing a letter of

credit for a Subtitle C facility’s financial assurance. 

However, the state found out in time before the cancellation

and was able to draw on the letter of credit. A different

problem occurred when another state agency attempted to

draw on a letter of credit established for financial assurance

and the financial institution claimed it had not issued the

letter of credit and refused to pay. This case has been

referred for appropriate legal action. 

 

Complexities in Overseeing In addition to the risks of company financial failures, there

the Financial Test are financial assurance risks caused by difficulties in

monitoring financial tests and corporate guarantees. During

our field work, we discussed with state officials the

complexities of overseeing the corporate financial test

mechanism. Some of the complicating factors are economic

changes in the waste management industry, company

mergers and acquisitions, difficulties in predicting the longterm survivability of individual firms, and evaluating financial

test submissions from firms with facilities in many states. 
23 Report No. 2001-P-007

Corporate acquisitions may occur without the state program

being notified. Where the original acquired corporation may

have provided a corporate guarantee, the new corporation

might be unqualified or might be unwilling to provide a

corporate guarantee. 

A firm using the financial test must supply cost estimates for

all facilities it is covering with the test mechanism. During

our file review, we found correspondence which illustrated

the problem states face in determining the accuracy of cost

estimates submitted for the financial test. The

correspondence described inaccuracies in cost estimates for

out-of-state-facilities. The out-of-state cost estimates were

supplied by a corporation using the financial test for facilities

in several states. To verify cost estimates for facilities in

other states, the state program must contact all other state

programs involved. Significant resources would be required

to do this for every financial test submission. 

A state official suggested that a national database with

financial test information would help state programs oversee

the financial test mechanism. We asked other officials from

the nine states in our sample whether they thought this type

of a database would be useful. The majority of officials who

responded to our questionnaire expressed an interest in a 

national database with financial assurance data and cited the

benefits of increased communication among state programs. 

However, some state officials expressed concerns such as

not having the resources to maintain the data from their

states in a database. Although a national database might not

be currently feasible due to resource constraints, increased

dialogue among states would be possible and beneficial. 

Officials from three state programs suggested using the

Internet for communicating financial assurance information

and discussions among states. We agree with this suggestion

and believe an inexpensive bulletin board could be

established on the Internet with access limited to state

financial assurance program officials. This suggestion is a

cost-effective interim solution for improving state

communication of financial assurance information and would

be easy and quick to implement. In addition, an Internet

bulletin board could help states share their solutions to

problems. 
24 Report No. 2001-P-007

Over One-Third of The complexities of the financial test are further magnified

Sample Used Financial for state programs by the large number of facilities using

Test/Corporate Guarantee this mechanism. In our sample of hazardous waste landfills,

over one-third of the facilities used the financial test or

corporate guarantee. In addition, the financial test had the

highest estimate in the ranges of closure plus post-closure

cost estimates in our sample, more than $107 million. 

Therefore, adequate monitoring of financial tests and

corporate guarantees is essential to avoid significant future

financial burdens for state programs or the Agency. 

Although captive insurance policies represent the lowest

percent of mechanisms in the sample, they provide very weak

assurance for a high average closure plus post-closure cost

estimate, over $13 million. Furthermore, they are used for

financial assurance by large national waste management

companies, and the probability is high that many facilities will

fail if one facility using captive insurance fails. Surety bonds

also represent a low percent of the sample but provide

assurance for an average cost estimate of more than $13

million. 

Nineteen Percent in Sample In our sample of hazardous waste facilities there were 19

Had No Financial Assurance percent with no financial assurance. For the majority of

facilities with no financial assurance, the cause appears to

have been facility non-compliance with financial assurance

requirements rather than failure of mechanisms. Facility noncompliance occurred in spite of enforcement efforts. 

Financial difficulties and bankruptcies were significant

contributing factors to facility non-compliance. In some

other cases, facilities had intended to clean close (completely

remove waste in accordance with regulations) but were

found later not to have met all requirements for clean

closure. In this group of facilities, we were told that most

have low levels of soil contamination and are currently

performing groundwater monitoring. For more information

on the distribution of mechanisms and ranges, as well as

averages of closure and post-closure cost estimates for

Subtitle C facilities in post-closure, please see the table in

Appendix III.

Local Government Financial In addition to data on hazardous waste facilities in postTest Highest Percentage in closure, we requested data on active MSWLFs from the

MSWLF Survey nine states in our survey. More than 30 percent of the

MSWLFs we received data for used the local government
5

The local government financial test is not available to hazardous waste facilities for closure and postclosure. Under certain circumstances, state-approved mechanisms may be available for Subtitle C facilities where

the state is not authorized for financial assurance regulations. However, all states in our sample, and most other

states, are authorized for these regulations.

25 Report No. 2001-P-007

financial test and an additional 25 percent used a stateapproved mechanism.5

 In contrast to hazardous waste

facilities, few MSWLFs we received data for used the

financial test or corporate guarantee. Not only did a high

percentage of these MSWLFs use the local government

financial test, but the highest estimate in the closure plus

post-closure cost estimate range was for the local

government financial test, close to $569 million. 

The local government financial test is similar to the corporate

financial test in that a local government owner of a MSWLF

can fulfill financial assurance requirements for some or all of

its obligations by meeting stipulated bond requirements or

financial ratio requirements. However, there is no net worth

requirement as there is for a corporate financial test. The

reason for not imposing a net worth requirement is, due to

their taxing authority, local governments are believed to be

less likely than private corporations to become insolvent. In

contrast to the corporate financial test, which was designed

to reduce the risk of bankruptcy, the local government

financial test was developed to indicate whether there would

be sufficient local government resources to establish another

financial assurance mechanism if the local government

financial condition deteriorates below acceptable levels. 

A local government which satisfies the financial test

requirements may also guarantee financial assurance for a

MSWLF it does not own or operate. (For more information

on the local government financial test, please see Appendix

II.) Given the large number of facilities using the local

government financial test and the high estimated closure and

post-closure costs associated with it, effective monitoring by

states of the financial conditions of local governments using

the test is important. Dialogue between states on their

experiences with the local government financial test could

help state programs increase their effectiveness, and an

Internet bulletin board would facilitate the dialogue. (For
26 Report No. 2001-P-007

more information on the MSWLF data from our survey,

please see Appendix I and the table in Appendix IV.)

Conclusions There are several actions the Agency should take to ensure

financial assurance mechanism risks are kept at acceptable

levels and to help state programs improve their oversight

capabilities. The strength of third party mechanisms depends

largely on independence between risks of financial failure of

the facility and the third party providing the mechanism. 

Policies and guidance need to be developed to eliminate

situations where independence is not maintained and to

ensure compliance with regulations. 

Captive insurance policies in our sample do not meet the

intent or requirements of RCRA financial assurance

regulations. The Agency should advise state programs to

determine whether an insurance policy issued for closure and

post-closure meets all requirements, including the

requirement that the policy allows assignment of the policy

to a successor owner or operator of the insured facility. The

state program should obtain verification from the insurance

commissioner, in the state where the insurance company

issuing the policy is licensed, that the policy can be assigned

to a successor owner or operator if the facility is sold outside

of the corporate family of the seller.

To assure low assurance risk when insurance is the

mechanism and that insurance policies comply with

regulations, EPA should investigate complex insurance issues

with states and the need for additional guidance on these

issues. 

Most states responding to our questionnaire said they needed

more financial assurance training from EPA. Existing

financial assurance training materials could be developed by

EPA for placement on the Agency’s Internet site. 

Not only can EPA help states be more effective, but states

can help each other by sharing solutions they have developed

to financial assurance problems. EPA’s help in promoting

more communication between states was also requested. In

addition to training sessions, workgroups, and roundtable

discussion, three states suggested using the Internet to

communicate financial assurance information. EPA should
27 Report No. 2001-P-007

work with the Association of State and Territorial Solid

Waste Management Officers (ASTSWMO) to develop a

bulletin board on the Internet. A bulletin board could be set

up with access limited to state financial assurance program

officials and would be an easy, economical, and quick

method for improving communication among states. 

Recommendations We recommend that the Acting Assistant Administrator for

Solid Waste and Emergency Response:

2.1 Issue guidance to state financial assurance programs

that when an insurance policy is used for closure or

post-closure financial assurance: 

• the insurance policy should meet all

requirements; and

 

• the state program should obtain verification

from the insurance commissioner, in the state

where the insurance company issuing the

policy is licensed, that the insurance policy

allows assignment of the policy to the

successor owner or operator of the facility, in

the event that the facility is sold outside of the

corporate family of the seller.

2.2 Investigate complex insurance issues with states and

determine states’ need for additional guidance on

these issues.

2.3 Develop existing financial assurance training

materials for placement on the Agency’s Internet site

to be downloaded by state programs.

2.4 Work with ASTSWMO to develop an Internet

bulletin board to increase opportunities for

information sharing among financial assurance

program officials.
28 Report No. 2001-P-007

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6

 For this chapter, we reviewed issues that Subtitle C and Subtitle D facilities have in common. 

Statements are meant to apply to both Subtitle C and Subtitle D facilities unless a distinction is made. 

29 Report No. 2001-P-007

CHAPTER 3

FINANCIAL ASSURANCE MAY BE NEEDED BEYOND

THE 30-YEAR POST-CLOSURE PERIOD

Financial assurance funds may not be adequate to protect

human health and the environment through the full period of

post-closure care. Federal regulations require post-closure

activities and financial assurance for 30 years after landfill

closure. However, the 30-year time frame was based on a

compromise and not on scientific research evaluating specific

landfill characteristics. We found there are many examples

of landfills that will need more than 30 years of post-closure

care. The wastes in these landfills pose a threat to human

health and the environment if they are not properly

contained. Potential problems after 30 years that could

disturb the integrity of landfills containing these wastes

include landfill liner leaks, leachate collection system

breakage, and landfill cap erosion or cracks caused by natural

weathering and animal penetration.

According to RCRA regulations, an agency may evaluate a

landfill and require additional years of post-closure care

covered by additional financial assurance. However, we

found that most of the state agencies in our sample, who

have the authority to extend post-closure care, have not yet

developed a policy or process to evaluate these sites. 

Furthermore, there is no Agency guidance on how to

determine the length of the post-closure care period. When

it eventually becomes necessary to conduct longer term

monitoring and maintenance for these landfills, financial

assurance funds may not be available for extended postclosure care if the company responsible for the landfill no

longer has sufficient funds or has gone out of business. 

RCRA Landfill and Post-Closure Land disposal facilities are required to meet certain

Care Requirements6

requirements to protect the environment from the migration

of contaminants. Liners and leachate collection systems are
30 Report No. 2001-P-007

intended to prevent waste migration by collecting and safely

removing leachate before it can migrate into the

groundwater. The landfill cover is designed to prevent the

inflow of liquids, primarily rain, into the waste unit and

thereby reduce the amount of leachate generated. There are

closure and post-closure standards in addition to landfill

design requirements. At closure of a unit, if the owner and

operator leave waste in place, the units must be maintained in

a way that ensures they will not pose a future threat to

human health and the environment. After closure, there is a

post-closure period when owners and operators must

conduct monitoring and maintenance activities to preserve

the integrity of the disposal system and continue to prevent

or control releases from the disposal units. Post-closure care

consists of two primary responsibilities: groundwater

monitoring and maintaining waste containment systems. 

Post-closure monitoring and maintenance activities include:

C Maintenance of the integrity of the final cover

C Operation of the leachate collection and removal

system until leachate is no longer detected

C Maintenance and monitoring of the leak detection

system

C Prevention of erosion or damage to the final cover

from run-on or run-off

C Protection and maintenance of surveyed benchmarks

Federal regulation requires a 30-year post-closure period

after the date closure of the disposal facility is completed. 

However, the time frame may be amended by the regulating

agency if it can be demonstrated that an extension would be

necessary to protect human health and the environment. 

Owners and operators are required to provide for financial

assurance for the estimated cost of post-closure care at a

landfill facility for the post-closure care period. 

Hazardous Waste In addition to closure and post-closure requirements for

Treatment Standards landfill design, EPA promulgated hazardous waste treatment

standards under Subtitle C. The treatment standards,

expressed as either concentration levels or required

technologies, are designed to substantially diminish the

toxicity of wastes or reduce the likelihood that hazardous

constituents from wastes will migrate from hazardous waste
31 Report No. 2001-P-007

disposal sites. The treatment standard rules known as Land

Disposal Restrictions (LDR) were promulgated in stages. 

The first LDR rule was published on November 7, 1986.

Therefore, a hazardous waste disposed of before schedule

rule implementation for that specific waste and all wastes

disposed of before November 1986 did not have to meet

treatment standards. Hazardous wastes already disposed of

do not need to meet LDRs unless they are removed from the

disposal unit. Furthermore, since the treatment standards

apply only to hazardous wastes regulated under Subtitle C,

municipal solid wastes are not treated according to these

standards. 

Over time, hazardous waste treatment standards promise to

substantially reduce the threat from disposed hazardous

wastes. A new hazardous waste landfill that has only

received treated waste might not need the same post-closure

care as landfills that were in operation earlier and received

untreated waste. However, current active hazardous waste

landfills and those in post-closure have received hazardous

wastes that were not treated. The untreated hazardous

wastes in Subtitle C landfills and municipal solid wastes in

Subtitle D landfills may pose significant threats when they

are not managed correctly.

Lack of Criteria for Extending Landfill design requirements and post-closure maintenance

Post-Closure Period for both Subtitle C and Subtitle D facilities are expected to

prevent leakage in the short term; however, their long-term

effectiveness in controlling releases of contaminants is

unknown. EPA and others have stated that it is likely that

some disposal facilities will leak at some period after they

close. Even the most technologically advanced landfill

containment systems have a finite life. However, the timing

and magnitude of any resulting post-closure liabilities and

effect on human health and the environment are uncertain. 

Many factors affect the degradation of materials, including

their physical and chemical properties, the availability of

oxygen and moisture within the landfill, temperature, and

microbial populations. Because of the complexity and

diversity of waste disposal sites in size and composition and

the lack of data, it is not possible to accurately predict

leakage contaminant quantities and production rates and the

extent and timing of potential leakages. 
32 Report No. 2001-P-007

EPA officials acknowledge the lack of criteria or scientific

basis for establishing the 30-year post-closure time frame. 

Initially, the proposed post-closure care time frame for

Subtitle C hazardous waste disposal facilities had been set

for a period of 20 years. Comments expressed in a 1980

Federal Register Notice asked EPA to extend the time frame

of 20 years of post-closure for Subtitle C facilities to as long

as the wastes remain hazardous, possibly in perpetuity. 

However, some who commented were concerned that an

extended time frame would place an economic burden on

smaller businesses. Therefore, EPA made the decision to

establish the time frame at 30 years, seemingly based on a

compromise of these competing interests. EPA officials we

spoke to agreed that the 30-year time frame was not based

on specific scientific criteria or research studies. The 1980

Federal Register notice further stated that a case-by-case

review would be necessary at sites due to the uncertainty

caused by a lack of extensive experience with properly

designed landfill operations. This review would allow for

extension of the post-closure time frame. 

In a 1988 Federal Register notice for Subtitle D municipal

solid waste landfills, EPA officials stated that releases may

occur after the 30-year post-closure period ends, and

expressed concern that 30 years may be insufficient to detect

releases at some landfills. The notice states that “. . . even

the best liner and leachate collection systems will ultimately

fail due to natural deterioration . . . ” EPA also considered

requiring an extended post-closure care period with an

option to reduce the period only if the owner or operator

could demonstrate that a reduction would not pose any

threat to human health and the environment. However, EPA

decided this approach would be overly burdensome to the

landfill owner and operator. EPA, therefore, set the postclosure care period at 30 years, but stated that a second

phase of reduced post-closure care beyond 30 years would

be necessary to ensure that releases are detected. The owner

or operator must continue, at a minimum, groundwater

monitoring and gas monitoring beyond the first 30 years, in

order to detect any contamination that might occur. The

1988 notice also discusses the importance of detecting

groundwater contamination in a timely fashion. 
33 Report No. 2001-P-007

Although Federal Register notices for Subtitles C and D

discuss the need for a case-by-case facility review and a

second phase of monitoring to ensure protection of human

health and the environment, RCRA regulations do not

provide enough criteria for determining this additional review

or monitoring phase. The regulation for Subtitle C facilities

only states that the post-closure care period may be extended

if “. . . necessary to protect human health and the

environment (e.g., leachate or groundwater monitoring

results indicate a potential for migration of hazardous wastes

at level which may be harmful to human health and the

environment).” The regulation is broad enough to allow

extensions of post-closure care for potential problems. 

However, the regulation implies that there should be

indications from leachate or groundwater monitoring that the

facility may present a risk to human health and the

environment. Although there may be no releases or

indications of releases at a landfill for the first 30 years of

post-closure, there may be a potential for releases of

hazardous waste in later years. For example, sites may

contain materials which are highly resistant to decomposition

and metals which remain toxic forever, and, as previously

stated, it is unknown how effective current landfill practices

will be in the long run in preventing these contaminants from

being released. Also, many factors affect the amount and

timing of potential leakages. 

Need for Continuing Post-Closure EPA officials have stated that based on current data and

Care Beyond 30 Years scientific prediction, the release of contaminants may

eventually occur, even with the application of best available

land disposal technology. There is concern that these

barriers will merely postpone the inevitable release of

contaminants until after the 30-year liability has expired. As

previously stated, some sites contain materials which are

highly resistant to decomposition or which remain toxic

forever. There have been several studies to determine the

expected life span of landfill liners, and opinions on this issue

vary widely. The bottom line is that not even the

manufacturers claim that their liners will last forever. Many

liners are only warrantied for a period of 20 years, and

landfill caps are only expected to last for 20 years. Leachate

collection systems have a finite life, as drains clog, and

pumping capacity declines with time. Some of the older

systems, which will be the first sites to end their 30-year
34 Report No. 2001-P-007

post-closure care period, were constructed without liners,

double liner protections, or leachate collection systems that

are required under today’s regulations. Potential failures at

landfills include:

C leachate collection systems clogging,

C leaks/ pinholes/ seams/ stress cracking/ brittle

fractures/ deterioration/ chemicals passing through

liners,

C erosion of the cap by natural weathering, vegetation

roots penetrating cover, burrowing by soil-dwelling

mammals, cave-ins by settling of wastes,

C seismic and general instability of the landfill, and

C rainfall creating more leachate that migrates into

groundwater (bathtub effect).

In our sample, we found several examples of barriers failing

during the first 30 years. Most of the states in our sample

reported animal or weather-related damage at their sites. 

Repairs were required at one facility after wild pigs rooting

in the near surface soil caused erosion of the landfill cap. In

another state, black bears have been a problem. We found

other examples of landfill caps eroding, damage to caps due

to animal burrows, and a drainage channel being destroyed

after heavy downpours. Other sites needed maintenance due

to vegetation growth. Additionally, unexpected events other

than natural erosion occurred at other sites which required

maintenance activities. For example, at one site an

automobile drove through the fence surrounding the facility,

destroying the leachate treatment system. Another landfill

site required repairs after children dug under a fence into the

landfill site in order to skateboard on an old truck ramp. 

Officials in one state speculated that all post-closure facilities

will need continuous surface and fence maintenance in

perpetuity.

A study performed by the MPCA’s Ground Water and Solid

Waste Division in 1998, came to the conclusion that medium

to large municipal solid waste landfills would need additional

monitoring and maintenance after the initial 30 years of postclosure care. The report states that continual site

maintenance beyond 30 years should include fencing,

building care, and inspection equipment. Monitoring of gas

and groundwater would also be necessary to ensure
35 Report No. 2001-P-007

protection to human health and the environment. Finally,

mowing the cap and preventing uncontrolled rainwater and

snow-melt from entering the stored waste and “reactivating”

the leaching of waste would be required. 

State Implementation of Federal regulations require facilities to initially establish

Post-Closure Requirements post-closure care for 30 years. For additional post-closure

care, EPA or the state agency must demonstrate that an

extension in the period is necessary to protect human health

and the environment. Although the burden is placed on the

regulating agency to demonstrate the necessity for extending

the post-closure care period, none of the states in our sample

had developed a policy to evaluate the adequacy of 30 years

of post-closure care at specific sites. Only two state

programs had extended the post-closure period beyond 30

years for a total of three hazardous waste facilities in the two

states. The following table summarizes state officials’

responses to our question regarding concerns about the

adequacy of a 30-year post-closure care time frame.
36 Report No. 2001-P-007

Table 3.1

Extensions of 30-Year Post-Closure Care 

for Hazardous Waste Facilities by State

State

Extensions to 30 Year Post-Closure?

Number of

Facilities Where

Post-Closure Care

Extended Subtitle C Subtitle D

 Alabama N* **

 California N N

 Connecticut N N

 Missouri N N

 New York Y N 2

 Ohio Y N 1

 Texas N N

 Virginia N N

 Washington N N

 * Alabama Subtitle C program requires the full 30 years of post-closure care to be 

 financially assured in each post-closure year.

 ** No information provided from Alabama’s Subtitle D program.

Although only two of the state programs we contacted have

extended the post-closure period beyond 30 years, several

state officials from Subtitle C and D programs in our nine

surveyed states expressed concerns that facilities may need

more than 30 years of post-closure care to ensure protection

of human health and the environment. State officials were

concerned that costs are likely to continue well past the

conventional 30-year post-closure care period since these

landfills will still contain contaminants. The Alabama

Subtitle C program requires that funds for the full 30 years of

post-closure be financially assured in each year. However,

Alabama has not yet extended the 30 years of post-closure

care for any Subtitle C facilities. Other state programs

believe that facilities will need extended care beyond 30
37 Report No. 2001-P-007

years, but have also not extended care at these facilities

beyond 30 years. Although many state officials are

concerned about the 30-year time frame, they explained that

they are uncertain about how to evaluate the adequacy of the

30-year time frame since there are no federal criteria

developed. Additionally, officials were unaware of any

studies performed in this area that could be used to develop

criteria. Officials stated that it would be useful to their

programs if federal guidelines provided criteria regarding

extending the post-closure period. There is concern that

without criteria to demonstrate that an extension beyond 30

years is necessary, states may be involved in legal battles

with owners and operators if they require post-closure

activities beyond 30 years. Landfills may become the

responsibility of state agencies’ in later years. The following

table illustrates state officials’ responses to our question

about the adequacy of a 30-year post-closure care period.

Table 3.2

State Responses on the Adequacy of 30 Years of Post-Closure Care

for Hazardous Waste Facilities

State

Program

30 Years -

Not Enough

Time

Not an Issue Not Yet

Evaluated

 Alabama X

 California X

Connecticut X

 Missouri X

 New York X

 Ohio X

 Texas X

 Virginia X

 Washington X
38 Report No. 2001-P-007

6.0%

20.0%

74.0%

No Yes Unknown

Site Care Beyond 30 Years

According to state officials, many disposal facilities may

require monitoring and maintenance activities in excess of 30

years, possibly in perpetuity. Officials in one state told us

that they believe all closed hazardous waste landfills will

need some type of post-closure care in perpetuity. Another

state program assumes that “virtually all” municipal solid

waste landfills will need to extend the care period beyond 30

years. For our nine-state sample of 178 hazardous waste

disposal facilities in post-closure, state officials said that one

out of five of the facilities in the sample will need care

beyond 30 years and that it is unknown whether almost 75%

of the hazardous waste disposal facilities in our sample will

need care beyond 30 years because the facilities have not

been evaluated. See Figure 3.1.

Figure 3.1

There is concern that states will be left with an unfunded

liability to address any remaining post-closure care necessary

since at the end of the 30-year time period the facilities’
39 Report No. 2001-P-007

owners or operators may no longer have sufficient funds or

may be out of business. For example, a corporation in one

state owns a closed hazardous waste landfill that has no

income or assets other than the site itself, and hopes to sell

the landfill for industrial redevelopment prior to running out

of money at the end of its 30-year post-closure period. In

order to provide assurance that funds will be available in the

future to cover long-term care costs at a given facility, it will

be necessary to assess the need for additional post-closure

care while the facility is in an economic position to fund the

additional post-closure care. 

Significant Expenditures May To evaluate the financial impact of not establishing

Be Required for Extended financial assurance beyond 30 years for post-closure care,

Post-Closure Care we asked officials from the nine states in our sample to

identify the expected cost of post-closure monitoring and

maintenance in the 30th year of care for the hazardous waste

disposal facilities in our sample. For facilities where funds

had not been established for more than 30 years, post-closure

costs for year 30 ranged from approximately $400 to more

than $1 million, averaging more than $96,000 per facility. 

Although significant expenditures are expected at these

facilities in year 30 of post-closure, there is no financial

assurance of funds for post-closure care during year 31 at the

same facilities. The absence of funds for monitoring and

maintenance of landfill facilities in year 31 could have a

significant adverse effect on state programs and the

environment. 

Figure 3.2 on the following page illustrates potential

cumulative post-closure costs after the 30th year for

hazardous waste disposal facilities in nine states, assuming

that the post-closure costs in future years remain at the same

level as the costs in year 30 and there is no unexpected clean

up needed at these sites. We based our calculations on

facilities in our sample which were identified by their state

programs as needing more than 30 years of post-closure care

or had not been evaluated to determine whether they would

need additional post-closure care. In addition, all of the

facilities included in the calculation had financial assurance

established for 30 years, but none had financial assurance for

more than 30 years. We did not include the facilities in our
40 Report No. 2001-P-007

2010 2015 2020 2025 2030 2035

Years

0

5

10

15

20

Millions

Cumulative Post-Closure Costs

sample which do not presently have financial assurance. We

also excluded all facilities from Alabama in our calculation

because Alabama requires the full 30 years of funds to be

maintained through year 30. 

Of the hazardous waste facilities included in the calculation,

year 2013 will be the first year a facility will reach year 31 of

post-closure care. We assumed that the facilities included in

the calculation will continue to need post-closure care for a

number of years after year 30 and no financial assurance

funds will have been established for the additional period. In

year 2017, the nine states would be required to spend more

than $2.8 million on post-closure care. By year 2030, the

annual burden on states, for this group in post-closure,

would be almost $19 million and growing. We have

assumed all facilities will continue to need the same amount

of care after year 30, and it may turn out that some will need

less care. However, there may be additional costs we have

not included, such as unanticipated clean up costs. See

Figure 3.2. 

Figure 3.2
41 Report No. 2001-P-007

EPA could have initially written RCRA regulations requiring

post-closure care in perpetuity, placing the burden of proof

on the facilities to demonstrate that a reduction in care would

not pose any threat to human health and the environment. 

This issue was discussed in a 1988 Federal Register notice. 

If this had been the requirement, the owners and operators

would have had a greater incentive to try to develop better

solutions to contain the waste into the indefinite future. In

addition, the facilities’ owners and operators who profited

from the operating landfills would have been required to bear

the costs and responsibilities for monitoring and maintenance

of thousands of closed hazardous and municipal solid waste

landfills for the full period of necessary care. Instead, future

generations may be left with a significant environmental and

financial burden. 

No Strategy Developed to In a June 1990 report, GAO examined land disposal

Address GAO Concerns practices, and the effectiveness of the funding for these longterm liabilities. In the report, Hazardous Waste: Funding of

Post-closure Liabilities Remains Uncertain, GAO stated

that although EPA was aware of the potential for future

releases, it had not yet developed a strategy for addressing

these long-term post-closure concerns. EPA responded that

although they shared the concern of the effectiveness of

long-term care, it was not a current priority in 1990. They

also stated that it would take many years to obtain

substantive information to determine the effectiveness of

current hazardous waste requirements in protecting

groundwater from contamination. Ten years have elapsed

since the GAO report was published, and EPA still has not

developed a comprehensive strategy to address these longterm post-closure concerns. GAO stated that long delays in

the evaluation of the effectiveness of current waste disposal

requirements have the potential to result in another

Superfund situation in future years. 

Study Conducted on As previously stated, it is not possible to accurately predict

Subtitle D Facilities leakage contaminant quantities and production rates because

of the complexity and diversity of many waste sites, as well

as other factors difficult to control. Therefore, EPA

currently lacks the scientific basis to develop specific criteria

to determine the adequacy of 30 years of post-closure care at
42 Report No. 2001-P-007

either Subtitle C or D facilities. Although wastes subject to

Subtitle C regulation have properties making them dangerous

or capable of having a harmful effect on human health the

environment, there have been no studies performed at this

time to evaluate the adequacy of 30 years of post-closure

care for Subtitle C facilities. An official in the Office of Solid

Waste (OSW) told us that studies of Subtitle C landfill

characteristics are resource intensive and OSW is not

currently funding work in this area. However, EPA’s Office

of Research and Development recently funded a study

examining the adequacy of 30 years of post-closure

monitoring at Subtitle D landfills. 

The objective of the Subtitle D study, which was conducted

at North Carolina State University, was to develop a

scientific basis to determine the appropriate length of time

for post-closure care at Subtitle D landfills to ensure

protection of human health and the environment. Scientists

state that although emissions are likely to continue well

beyond 30 years, EPA lacks criteria to define an appropriate

end point for post-closure monitoring. Without criteria to

demonstrate that an extension to 30 years is necessary,

landfills permitted in the 1990s may be state agencies’

responsibilities in the 2020s. We reviewed a draft of this

study, A Critical Evaluation of Factors Required to

Terminate the Post-Closure Monitoring Period at Solid

Waste Landfills. Draft results indicate that initial criteria

were developed to determine the point at which a landfill

becomes sufficiently stable to terminate the owner’s

responsibility to monitor the site. Based on the draft results,

stability at a landfill is dependent on many complex factors. 

The study found that a 30-year post-closure period may not

be adequate for a landfill to reach stability, and that

additional technical criteria will need to be established to

define leachate and gas stability. Scientists believe that an

assessment of the first group of landfills to reach the 30-year

post-closure status will need to be performed to further

develop criteria.

Initial feedback on the study indicates that EPA and the

stakeholders agree with the study’s preliminary findings, and

the scientist we spoke to believes that criteria developed
43 Report No. 2001-P-007

could be incorporated into an EPA policy for Subtitle D

facilities. As previously stated, there are no current studies

being conducted on site characteristics of Subtitle C

hazardous waste landfills. We were told that findings from a

study on Subtitle D facilities would not necessarily be

applicable to Subtitle C landfills. Since a hazardous waste

landfill may pose a significant risk to human health and the

environment, a study of hazardous waste landfills to

determine an appropriate length of time for post-closure care

should be a priority. Also, based on the draft finding of the

Office of Research and Development-funded study, further

research is needed to develop substantive criteria for Subtitle

D facilities. Information from these studies should be

incorporated into standard EPA guidance with specific

criteria so that regulating agencies can consistently evaluate

facilities on a case-by-case basis. Continued delays in

evaluating the effectiveness of current waste disposal

practices may result in harmful effects on human health and

the environment. 

Conclusions The long-term effectiveness of current land disposal practices

in controlling the release of contaminants is unknown. The

extent of potential post-closure liabilities at specific facilities

is unknown because of the current lack of available data. 

The consequence of not addressing the problem of postclosure care may be that the state or federal government will

be left with the financial burden of addressing any remaining

post-closure care necessary at these facilities. It is important

to assess the need for additional post-closure care while the

facility is in an economic position to fund additional postclosure care. Rather than passing the problem of postclosure care on to future generations, the problem should be

addressed now, and solutions implemented for each landfill

long before the end of the 30-year period. EPA needs to

assist in ensuring that the long-term stewardship of closed

landfills will provide maximum protection of public health

and the environment. 
44 Report No. 2001-P-007

Recommendations We recommend that the Acting Assistant Administrator for

Solid Waste and Emergency Response:

3.1 Discuss with ASTSWMO the development of a

methodology for state programs to use in evaluating

facility post-closure care time frames. 

3.2 Conduct further studies, as resources allow, to

develop criteria for the appropriate post-closure care

time frames at Subtitle C and D landfills. 
45 Report No. 2001-P-007

CHAPTER 4

ACCURATE COST ESTIMATES ARE 

NECESSARY FOR FINANCIAL ASSURANCE

Accurate cost estimates are necessary to assure adequate

funding for closure and post-closure activities. However,

there is evidence that some facilities have submitted cost

estimates that were too low. Federal regulations require that

estimates for closure and post-closure care reflect costs of

having a third-party conduct the required activities to ensure

that adequate funds will be available even if the owner or

operator goes bankrupt. State program officials have

expressed concerns that underestimated costs could result in

insufficient funding of financial assurance mechanisms. We

were told that:

 C cost estimates are difficult to review and that states

use different methods to review the estimates,

ranging from reviewer judgment to use of a standard

software package;

C monetary incentives exist for facility owners and

operators to underestimate costs for closure and

post-closure activities by lowering the cost of

establishing mechanisms for financial assurance (e.g.,

insurance premiums, surety bonds, and trust funds);

and

C it is easier for facilities to meet the requirements of

the financial test mechanism by underestimating

costs.

Without accurate cost estimates to assure adequate funding

for closure and post-closure activities, there is less assurance

that human health and the environment will be protected if

the owner or operator becomes financially insolvent and

funds are not available for closure and post-closure. In most

states, program officials are responsible for determining

whether or not the cost estimates are adequate based on
46 Report No. 2001-P-007

closure and post-closure plans. EPA has helped some states

become more effective in reviewing cost estimates, but other

states could also benefit from similar assistance. 

EPA Region IV Studies EPA Region IV conducted two studies that evaluated

Show That Facilities facility-submitted financial assurance cost estimates. Both

Underestimate Costs studies concluded that most of the costs evaluated had been

underestimated. One of the studies included a sampling from

all Region IV states and found that 89 of 100 facilities had

submitted cost estimates that were too low. The total

amount of underestimated costs was approximately $450

million for these 89 facilities. In the other study, 35 facilitysubmitted cost estimates were evaluated from one Region IV

state. The study found that the majority of these facilities

had underestimated costs for closure and post-closure

activities. Underestimated closure costs totaled $91 million,

and underestimated post-closure costs totaled $1.7 million. 

Both studies found that some facilities had overestimated

costs. However, overestimated costs do not benefit EPA or

state programs since additional funds established by

overestimating costs would not be available to cover closure

and post-closure for facilities that did not provide adequate

financial assurance. 

Region IV’s Improvements to To address the underestimated costs, EPA Region IV

the Cost Estimating Process developed a manual entitled “Evaluating Cost Estimates for

Closure and Post-Closure Care of RCRA Hazardous Waste

Management Units.” The purpose of the manual was to

provide EPA and RCRA Subtitle C permit writers with a

consistent, accurate, and rapid method for evaluating cost

estimates for closure and post-closure care of RCRA

treatment, storage, and disposal units. The Manual states

that the Region determined that cost estimates for closure

and post-closure care for a number of facilities were

significantly lower than the actual costs incurred. This

indicates that methods used for estimating the costs of

closure and post-closure care may have been inaccurate. 

Inaccurate cost estimates may be caused by underestimating

costs of closure and post-closure care activities or by failing

to cost all activities that must be conducted. Region IV also

initiated the development of a software tool to evaluate
47 Report No. 2001-P-007

financial assurance cost estimates for closure and postclosure care of RCRA Subtitle C facilities. The software

tool incorporated the Manual’s methodology saving even

more time over manual methods when evaluating cost

estimates. EPA Region IV officials informed us that all eight

states in their Region had been supplied with this software

tool, and had used it to review facility-submitted cost

estimates. 

The Manual and software incorporate Means Cost Guides as

the primary sources of cost information and are recognized

as being reliable and comprehensive sources for construction

cost data. Means data is often specified as the standard for

construction costs both in the private sector and throughout

government, including such agencies as the Federal Housing

Administration, the Department of Defense, and the General

Services Administration. All cost data developed by Means

is supported by a system of indexes that enables clients to

localize output automatically to any one of more than 900

three-digit postal codes in the United States and Canada. 

Updates to Means Cost Guides are available on an annual

basis. We also were informed of another software package

on the market, incorporating Means data, which can be used

by states to evaluate closure and post-closure cost estimates.

Feedback from Users of Officials from four states in our survey reported using cost

Cost Estimating Software estimating software during their review process. We

solicited feedback from these state program officials and

received positive comments. Listed below is some of the

feedback we received:

• Previous to the use of the software, the accuracy of

each cost estimate review was subject to the level of

expertise and knowledge of the individual inspectors

performing the reviews.

• Challenging cost estimates in the past was not

commonplace since having to research and look up

costs in different forms of documentation was very

difficult and required a lot of time.
48 Report No. 2001-P-007

• Prior to the use of the software, documentation and

guidance varied so much that some fuel blender

facilities that were very much alike were submitting

estimates for closure that varied from $100,000 to

$5,000,000. Since documentation for costs at this

time was so inconsistent it was very difficult to even

challenge the wide discrepancies for like facilities. 

It’s a very good tool for evaluating and comparing

like unit costs from different facilities.

• The software saves time and allows the reviewer to

easily detect many deficiencies and discrepancies in

facility-submitted estimates.

States Need to Be Informed While some states reported using cost estimating software,

About Cost Estimating Software officials in four of the nine states we contacted were unaware

that software existed for reviewing cost estimates. Use of an

automated software tool to review cost estimates would

assist and improve state programs by providing a significant

savings of time over the manual method of reviewing cost

estimates. Also, the software produces a more accurate and

complete method than reliance on the experience and

expertise of the cost estimate reviewer. Finally, an

automated program allows for a more consistent and

objective baseline which can facilitate discussions with

facilities on cost estimates that may need to be revised. 

Although the software was developed by Region IV for

evaluating Subtitle C facility cost estimates, with minor

modifications it can also be used to evaluate Subtitle D cost

estimates. 

Conclusions To improve the cost estimating review process, we believe

that EPA should inform state Subtitle C programs and EPA

Regions of the option of using cost estimating software. 

Furthermore, for states that request it, EPA could help those

states obtain software for reviewing closure and post-closure

cost estimates and any existing training for using the

software. In addition, EPA should modify the cost

estimating software developed in Region IV for use by state

Subtitle D financial assurance programs. 
49 Report No. 2001-P-007

Recommendations We recommend that the Acting Assistant Administrator for

Solid Waste and Emergency Response:

4.1 Inform state Subtitle C and Subtitle D programs, and

EPA Regions of the option of using cost estimating

software. Furthermore, for states that request it, help

states obtain software for reviewing closure and postclosure cost estimates. Any existing software

training materials should also be made available to

financial assurance programs requesting the software.
50 Report No. 2001-P-007

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51 Report No. 2001-P-007

APPENDIX I

SAMPLING METHODS AND DATA

To collect data on facilities regulated under Subtitle C, we selected a statistical sample of Subtitle

C facilities from a nine-state subset population in the RCRIS post-closure universe. The nine

states were Alabama, California, Connecticut, Missouri, New York, Ohio, Texas, Virginia, and

Washington. Data from these states represented approximately 40 percent of the RCRIS postclosure universe. We further restricted the population to privately owned Subtitle C facilities

which were expected to have established financial assurance. Therefore, we excluded, from the

population government-owned facilities and facilities which were coded as non-notifiers in RCRIS. 

Federal and state owned RCRA facilities are not required to establish financial assurance, and nonnotifiers would not be expected to have established financial assurance because they operate

illegally. We also excluded local government Subtitle C facilities. Only one of the nine states in

the population had a significant number of local government Subtitle C landfills in post-closure. 

Since we drew the sample from the nine state subset population, our projections were made to the

population of nine states rather than to individual states. RCRIS does not contain data on financial

assurance, and we only relied on RCRIS for its list of facilities in post-closure from which we drew

our sample. We did not conduct a review of RCRIS internal controls. 

Initially, there were 482 facilities in our nine state subset population of facilities in post-closure. 

We selected a sample of 220 facilities from this population. However, we found when we

collected data that 31 of the facilities in our sample should not have been listed in the RCRIS postclosure universe, and two more facilities were government owned and should have been excluded

from the subset population. Therefore, our sample size was reduced to 187. Based on our sample

results, we projected the subset population size for the nine states to be 410. Please see the table

in Appendix III for the distribution of mechanisms for hazardous waste facilities in post-closure

and closure and post-closure cost ranges and averages. 

Since facilities listed in RCRIS are regulated under RCRA Subtitle C and there is no EPA database

for MSWLFs regulated under Subtitle D, we asked each of the nine states to supply us with a list

of their active MSWLFs. Of the nine states, we received data from seven. We did not receive

MSWLF data from Alabama or Washington State. Alabama does not have a financial assurance

program for MSWLFs, primarily because the Alabama legislature has not passed the necessary

legislation. Washington State was in the process of collecting the data when we made our request

and had not yet completed the task when we finished our fieldwork. Therefore, the table in

Appendix IV does not include data from Alabama or Washington State. Federal regulations do

not require MSWLFs to send copies of financial assurance records to the state agency. However,
52 Report No. 2001-P-007

some states, such as New York, require MSWLFs to send in financial assurance documentation to

the state program. 

We selected statistical samples of MSWLFs in California, Ohio, and Texas, and those states

provided MSWLF data for the sample facilities. Four states- Connecticut, Missouri, New York,

and Virginia- sent us data on the universe of active MSWLFs in the state. Connecticut only had

one active MSWLF. Data sent by Virginia included estimated closure and post-closure costs for

less than half of their MSWLFs. However, Virginia identified mechanisms for all of their

MSWLFs. We decided to include Virginia MSWLF data in the table in Appendix IV after we

compared the differences in calculations when we included and excluded the Virginia data. There

were no changes in the ranges of closure and post-closure costs. The only significant change in

weighted average costs was in the local government financial test, which decreased by

approximately 10 percent when Virginia data were included. The most significant change in

mechanisms was in the number of facilities using the local government financial test, which

increased by approximately 60 percent when Virginia data were included. Please see the table in

Appendix IV for the distribution of mechanisms for active municipal solid waste landfills and

closure and post-closure cost ranges and averages.

 
53 Report No. 2001-P-007

APPENDIX II

FINANCIAL TEST REQUIREMENTS

Note - Following are summaries of some of the financial test requirements. These are included for

report discussion purposes only. This information cannot be used to determine compliance with

financial test requirements. There are additional financial test requirements for reporting which

are not listed.

Corporate Financial Test - Subtitle C Requirements

To pass the financial test the owner or operator of a permitted or interim status TSDF must

satisfy the following criteria.

• Two of following three ratios -

C total liabilities to net worth less than 2.0

C sum of net income plus depreciation, depletion, and amortization to total liabilities

greater than 0.1

C current assets to current liabilities greater than 1.5;

• 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;

• Tangible net worth of at least $10 million; and

• Assets located in the United States amounting to at least 90 percent of 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.

Or, the owner or operator must satisfy the following alternate criteria.

• A current rating for his 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;

• Tangible net worth at least six times the sum of the current closure and post-closure cost

estimates and the current plugging and abandonment cost estimates;

• Tangible net worth of at least $10 million; and
54 Report No. 2001-P-007

• Assets located in the United States amounting to at least 90 percent of 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. 

Corporate Financial Test - Subtitle D Requirements

The owner or operator of a MSWLF must satisfy one of the following three conditions:

1. A current rating for its senior unsubordinated debt of AAA, AA, A, or BBB as issued by

Standard and Poor’s or Aaa, Aa, A, or Baa as issued by Moody’s; 

2. A ratio of less than 1.5 comparing total liabilities to net worth; or

3. A ratio of greater than 0.10 comparing the sum of net income plus depreciation, depletion,

and amortization, minus $10 million, to total liabilities.

In addition, the tangible net worth of the owner or operator must be greater than:

A. The sum of the current closure, post-closure care, corrective action cost estimates and any

other environmental obligations, including guarantees, covered by a financial test plus $10

million except as provided in paragraph B following.

B. $10 million in net worth plus the amount of any guarantees that have not been recognized

as liabilities on the financial statements provided all of the current closure, post-closure

care, and corrective action costs and any other environmental obligations covered by a

financial test are recognized as liabilities on the owner’s or operator’s audited financial

statements, and subject to the approval of the State Director.

In addition, the owner or operator must have assets located in the United States amounting to at

least the sum of current closure, post-closure care, corrective action cost estimates and any other

environmental obligations covered by a financial test.

Local Government Financial Test - Subtitle D Requirements

The owner or operator of a local government MSWLF must satisfy either A or B as applicable:

(A) If the owner or operator has outstanding, rated, general obligation bonds that are not

secured by insurance, a letter of credit, or other collateral or guarantee, it must have a

current rating of Aaa, Aa, A, or Baa, as issued by Moody’s or AAA, AA, A, or BBB as

issued by Standard and Poor’s on all such general obligation bonds; or 
55 Report No. 2001-P-007

(B) The owner or operator must satisfy each of the following financial ratios based on the

owner’s or operator’s most recent audited annual financial statement:

(1) A ratio of cash plus marketable securities to total expenditures greater than or

equal to 0.05; and

(2) A ratio of annual debt service to total expenditures less than or equal to 0.20

The owner or operator must also prepare its financial statements in conformity with Generally

Accepted Accounting Principles for governments and have its financial statements audited by an

independent certified public accountant (or appropriate State agency).

In addition, a local government is not eligible to assure its obligations under CFR 40 Sec.

258.74(f) if it:

(A) Is currently in default on any outstanding general obligation bonds; 

(B) Has any outstanding general obligation bonds rated lower than Baa as issued by 

Moody’s or BBB as issued by Standard and Poor’s; 

(C) Operated at a deficit equal to five percent or more of total annual revenue in each of

the past two fiscal years: or

(D) Receives an adverse opinion, disclaimer of opinion, or other qualified opinion from the

independent certified public accountant (or appropriate State agency) auditing its financial

statement as required. However, the Director of an approved State may evaluate qualified

opinions on a case-by-case basis and allow use of the financial test in cases where the

Director deems the qualification insufficient to warrant disallowance of use of the test. 
56 Report No. 2001-P-007

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57 Report No. 2001-P-007

APPENDIX III

DISTRIBUTION OF FINANCIAL ASSURANCE MECHANISMS

FOR HAZARDOUS WASTE LANDFILLS IN POST-CLOSURE*

Financial Assurance

Mechanism

% of

Sample

Projected #

in

Population 

Range of Closure and

Post-Closure Estimated

Costs Combined

Average of Closure

and Post-Closure

Estimated Costs 

Financial Test/

Corporate Guarantee

34% 140 $45,290 - $107,909,032 $6,640,715 

Captive Insurance 3% 11 $1,781,797 - $40,574,914 $13,307,166 

Insurance 5% 20 $320,558 - $37,142,139 $12,799,589 

Surety Bond 4% 18 $489,517 - $68,520,883 $13,266,513 

Fully Funded Trust

Fund

5% 22 $66,780 - $1,032,411 $457,820 

Partially Funded Trust

Fund

9% 35 $55,926 - $3,047,000 $913,872 

Letter of Credit 21% 86 $88,757 - $67,621,604 $3,389,952 

None Established 19% 79 Data Not Available Data Not

Available

 * Data for this table were obtained from nine states. Please see Appendix I for more details on 

 sampling methods and data.
58 Report No. 2001-P-007

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59 Report No. 2001-P-007

APPENDIX IV

DISTRIBUTION OF FINANCIAL ASSURANCE MECHANISMS 

FOR ACTIVE MUNICIPAL SOLID WASTE LANDFILLS*

Financial Assurance

Mechanism

% of

Population

Projected #

in

Population

Range of Closure and PostClosure Estimated Costs

Combined

Weighted

Average of

Closure and

Post-Closure

Estimated

Costs 

Financial Test/ 

Corporate Guarantee

0.6% 3 $ 3,371,140 - 13,317,263 $7,990,982 

Captive Insurance 1.4% 7 $ 4,388,539 - 13,712,781 $9,857,193 

Insurance 6.9% 35 $ 676,487 - 20,700,960 $8,115,694 

Surety Bond 18.9% 96 $ 27,940 - 46,483,632 $7,887,404 

Trust Fund 6.9% 35 $ 174,000 - 22,310,485 $8,485,309 

Letter of Credit 4.9% 25 $ 85,340 - 13,249,291 $2,401,695 

Local Government

Financial Test

31.6% 160 $ 46,786 - 568,998,563 $10,556,183 

State Approved 25.4% 129 $ 498,211 - 76,944,080 $11,283,544 

Combined 2.6% 13 $ 2,431,600 - 31,721,165 $14,961,777 

None Established 0.8% 4 Data Not Available Data Not

Available

* Data were obtained from seven states for this table. Please see Appendix I for more details on 

 methods and data.
60 Report No. 2001-P-007

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61 Report No. 2001-P-007

APPENDIX V

AGENCY RESPONSE 

March 27, 2001

MEMORANDUM

Subject: Response to OIG Draft Audit Report: “RCRA Financial Assurance for 

 Closure and Post-Closure”

From: Michael H. Shapiro, Acting Assistant Administrator/s/

Office of Solid Waste and Emergency Response (5101)

To: Mike Prater, Audit Manager

Headquarters Audit Division (2443)

The purpose of this memorandum is to transmit the Office of Solid Waste and Emergency

Response’s response to the subject Office of Inspector General (OIG) draft audit report. Thank

you for the opportunity to comment on this draft report. As you are aware, we suggested this

subject area as a topic for your investigation. In addition to these comments, the Office of Solid

Waste (OSW) has commented on previous working drafts of the report. However, those drafts

did not include recommendations or Chapter 1. Following are our specific comments to the OIG

draft recommendations.

OIG Recommendations

Issue guidance to state financial assurance programs that when an insurance policy is used

for closure and post-closure financial assurance,

C the insurance policy should meet all requirements; and

C the state program should obtain verification from the insurance commissioner, in the state

where the insurance company issuing the policy is licensed, that the insurance policy

allows assignment of the policy to a successor owner or operator of the facility, in the

event the facility is sold outside of the corporate family of the seller.
62 Report No. 2001-P-007

OSWER Response

OSW will work with the Office of General Counsel and key state insurance commissioners

to determine which insurance policies allow assignment. Depending upon the outcome of these

discussions, OSW will work with interested parties, and, if appropriate, will prepare draft

guidance for comment. If you have correspondence from state insurance commissioners on the

issue of assignment that we could include in this guidance, we would appreciate receiving a copy

of it. We would also like to receive the names and domiciles of the insurers you have identified

and the owners and operators who use them. This will assist us in our communications with state

solid and hazardous waste officials, insurance commissioners, and waste companies. Depending

upon whether and when such correspondence is available, we expect that this process could take

to the end of this calendar year to determine the need for and to prepare draft guidance for

comment. 

OIG Recommendations

Investigate complex insurance issues with states and determine states’ need for additional

guidance on these issues.

Work with the Association of State and Territorial Solid Waste Management Officials

(ASTSWMO) to develop an Internet bulletin board to increase opportunities for information

sharing among financial assurance program officials.

Discuss with ASTSWMO the development of a methodology for state programs to use in

evaluating facility post-closure time frames.

OSWER Response

ASTSWMO has requested that EPA discuss your report and our response to your

recommendations at their April 18th and 19th mid-year meeting. At that meeting, we intend to

request that they provide information to us about needs for additional guidance in the area of

insurance, whether they wish to implement a bulletin board, and ideas for developing

methodologies for evaluating post-closure time frames.

OIG Recommendation

Develop existing financial assurance training materials for placement on the Agency’s

Internet site to be downloaded by state programs.
63 Report No. 2001-P-007

OSWER Response

RCRA Hotline training material for the hazardous waste financial assurance requirements

is located at http://www.epa.gov/epaoswer/hotline/rmods.htm. This material provides an

introduction to the topic, but States sometimes request more detailed information. EPA has

responded to these requests in basically two ways. First, EPA has provided twelve hours of

satellite training on municipal financial assurance (except for the corporate test and guarantee),

that would involve conversion to files that would be too large for use on the Internet. The second

and more adaptable training materials, which EPA has presented to states in interested regions,

have been based upon overheads. The overheads generally limit the amount of information on

each screen because they are supplemented by the instructor. This also may not provide an

effective format for web based training. Before putting information on the web, OSW will ask

ASTSWMO for recommendations on the type of material, the primary audience (e.g. regulators

or owners and operators, and the presumed familiarity with the material), and the level of detail

that would be appropriate. Once we have ASTSWMO’s feedback, and as resources allow, we

will develop material for the Internet.

OIG Recommendation

As resources allow, conduct further studies to develop criteria for the appropriate postclosure time frames at Subtitle C and D facilities.

OSWER Response

Currently, the OSW is reviewing information from studies funded by the Office of

Research and Development on the stability of municipal landfills and their production of leachate

and gas. We are sharing this information with the states to help inform their decisions about the

length of the post-closure period. As noted in your report, we currently have no additional

research available on hazardous waste landfills and it is difficult to predict when funding for such

studies will become available. 

We also intend to seek state help in identifying municipal solid waste landfills (MSWLFs)

that collect and analyze leachate for hazardous constituents. The goal would be to analyze longterm data on leachate quality to help determine the time frame at which leachate no longer poses a

threat to human health and the environment. Assuming that the states decide to work with us, we

would begin work later this fiscal year, and hope to complete the analysis next fiscal year.

 

OIG Recommendations

Inform state Subtitle C programs and EPA regions of the option of using cost estimating

software and help states, that request it, obtain software for reviewing closure and post-closure
64 Report No. 2001-P-007

cost estimates. Any existing software training materials should also be made available to financial

assurance programs requesting the software.

Modify the cost estimating software developed for Region IV so that it can be distributed

to states that request the software, for reviewing Subtitle D landfill cost estimates.

OSWER Response

We will request that ASTSWMO ask which of their members desire copies of the

software, and we will make copies available to those states. Our understanding is that the most

recent version of the software includes information that can be used for estimating costs for

municipal solid waste landfills. Therefore, we should be able to provide this information when

states request copies. 

Other Comments on the Report

We had some comments on the other portions of the report and appreciate your

addressing those concerns at our March 22nd meeting. Accordingly, I have not included those

comments in this memorandum.

As you may be aware, the Agency has been directed in its 2001 appropriation to conduct a

study of existing financial assurance agreements to determine if sufficient safeguards have been

properly maintained and future liabilities minimized for municipal solid waste landfills. Your

report will assist us in responding to this request. We thank you for this study.

I would like to acknowledge the excellent cooperation we experienced working with OIG

staff during this audit. If you have any questions, please contact Dale Ruhter at (703) 308-8192.

cc: Steve Luftig

 Elizabeth Costworth

 Dale Ruhter

 Sonya Sasseville

 Bob Hall

 Bob Dellinger

 Anne Andrews
65 Report No. 2001-P-007

APPENDIX VI

REPORT DISTRIBUTION

Inspector General

Assistant Inspector General for Office of Program Evaluation

Headquarters Audit Liaison (Carol Jacobson)

Divisional Inspectors General for Audit (and sub-offices)

Acting Assistant Administrator for Solid Waste and Emergency Response

Acting Assistant Administrator for Enforcement and Compliance Assurance

Comptroller

Agency Follow-up Official

Agency Follow-up Coordinator

Assistant Administrator for Congressional and Intergovernmental Relations (1301A)

Elizabeth Cotsworth (5301W)

Johnsie Webster (5103)

Gregory Marion (2201A)

Anne Andrews (5305W)

Stephen Heare (5303W)

Robert Dellinger (5306W)

Deborah Hanlon (5306W)

Sonya Sasseville (5303W)

Dale Ruhter (5303W)

Nina Rivera (2366A)

Betsy Smidinger (2246A)

Christine McCulloch (2246A)

Peter Neves (2273A)

Mary Bell (2273A)

Robert Hall (5303W)

Eileen Larence

Abe Oberkor, Alabama

Russell Kelly, Alabama

Sue Laney, California

Richard Castle, California

Wade Cornwell, California

David Nash, Connecticut Gregory Marion

Kevin Sullivan, Connecticut

Inga Rubeca, Connecticut 

Cindy Kemper, Missouri
66 Report No. 2001-P-007

Jim Hull, Missouri

Henry Hamilton, New York

Amy Feiden, New York

Pam Allen, Ohio

Sharon Gbur, Ohio

Fanny Haritos, Ohio

Matt Boyer, Ohio

Dale Burnett, Texas

John Racanelli, Texas

Darin Rice, Washington

Randy Martin, Washington

Mary Ellen Kendall, Virginia

Virginia Butler, Virginia