Source: http://www.dec.ny.gov/regs/14938.html
Timestamp: 2014-11-27 06:45:07
Document Index: 568792104

Matched Legal Cases: ['art 373', 'art 373', 'art 373', 'art:\n373', '§373', 'art 370', 'art 373']

Subpart 373-2: Final Status Standards For Owners and Operators Of Hazardous Waste Treatment, Storage and Disposal Facilities - Page 2 - NYS Dept. of Environmental Conservation
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Subpart 373-2: Final Status Standards For Owners and Operators Of Hazardous Waste Treatment, Storage and Disposal Facilities - Page 2
[page 2 of 7] Pages in this Part:
373-2.8 Financial Requirements.
§373-2.8 Financial Requirements.
(1) The requirements of subdivisions (c), (d) and (h) through (j) of this section apply to owners and operators of all hazardous waste facilities, except as provided otherwise in this section or in section 373-2.1(a) of this Subpart.
(2) The requirements of subdivisions (e) and (f) of this section apply only to owners and operators of:
(ii) piles, and surface impoundments from which the owner or operator intends to remove the wastes at closure, to the extent that these sections are made applicable to such facilities in sections 373-2.11(f) and 373-2.12(h) of this Subpart; and
(iv) containment buildings that are required under subdivision 373-2.30(c) of this Subpart to meet the requirements for landfills.
(3) The State and the Federal government are exempt from the requirements of this section.
(4) The Department may replace all or part of the requirements of this section applying to a regulated unit with alternative requirements for financial assurance set out in the permit or in an enforceable document (as defined in paragraph 373-1.2(e)(3) of this Title), where the Department:
(i) Prescribes alternative requirements for the regulated unit under paragraphs 373-2.6(a)(6) and/or 373-2.7(a)(3); and
(1) "Closure plan" means the plan for closure prepared in accordance with the requirements of section 373-2.7(c) of this Subpart.
(5) "Post-closure plan" means the plan for post-closure care prepared in accordance with the requirements of subdivisions 373-2.7(g) through (j).
(6) "Revenue-oriented," or "revenue-oriented hazardous waste management facility" means any facility (as defined in section 27-0917(7) of the ECL or Part 370 of this Title) for which a majority of both its operating revenues and profits after tax at that facility for the prior three (3) years and for the current and next year have been and are expected to be attributable to the transportation, storing, handling, disposal, treatment, or management of solid and hazardous wastes or related activities or to the ownership of or lease hold or other interest in any persons, facilities, or other assets engaged in or used for such activities. In making such calculations under this provision, all sources of operating revenues and profits (both before and after tax) shall be included. The commissioner may request any person to show to the satisfaction of the commissioner that the facility is not a revenue-oriented hazardous waste management facility by this definition. The commissioner may require a person to present its statements of account, independently audited by a certified public accountant, and other records to make this showing.
(ix) "Tangible net worth" means the tangible assets that remain after deducting liabilities; such assets would not include intangibles such as good-will and rights to patents or royalties.
(c) Cost estimates for closure.
(1) The owner or operator must have a detailed written estimate, in current dollars, of the cost of closing the facility in accordance with the requirements in subdivisions 373-2.7(b) through (f) and applicable closure requirements in subdivisions 373-2.9(i), 373-2.10(h), 373-2.11(f), 373-2.12(h), 373-2.13(h), 373-2.14(g), 373-2.15(h), 373-2.24(b), (c) and (d), and 373-2.30(c) of this Subpart.
(i) The estimate must equal the cost of final closure at the point in the facility's active life when the extent and manner of its operation would make closure the most expensive, as indicated by its closure plan (see paragraph 373-2.7(c)(2) of this Subpart).
(ii) The closure cost estimate must be based on the costs to the owner or operator of hiring a third party to close the facility. A third party is a party who is neither a parent nor a subsidiary of the owner or operator. (See definition of parent corporation in subdivision (b) of this section). The owner or operator may use costs for on-site disposal if the owner or operator can demonstrate that on-site disposal capacity will exist at all times over the life of the facility.
(iii) The closure cost estimate may not incorporate any salvage value that may be realized with the sale of hazardous wastes, or non-hazardous wastes if applicable under 373-2.7(d)(4), facility structures or equipment, land, or other assets associated with the facility at the time of partial or final closure.
(iv) The owner or operator may not incorporate a zero cost for hazardous wastes, or non-hazardous wastes if applicable under 373-2.7(d)(4), that might have economic value.
(2) During the active life of the facility, the owner or operator must adjust the closure cost estimate for inflation within 60 days prior to the anniversary date of the establishment of the financial instruments used to comply with subdivision (d) of this section. For owners and operators using the financial test or corporate guarantee, the closure cost estimate must be updated for inflation within 30 days after the close of the firm's fiscal year and before submission of updated information to the commissioner as specified in section 373-2.8(d)(5)(iii) of this Part. The adjustment may be made by recalculating the maximum costs of closure in current dollars, or by using an inflation factor derived from the most recent Implicit Price Deflator for Gross National Product published by the U.S. Department of Commerce in its Survey of Current Business, as specified in subparagraphs (i) and (ii) of this paragraph. The inflation factor is the result of dividing the latest published annual deflator by the deflator for the previous year.
(3) During the active life of the facility, the owner or operator must revise the closure cost estimate no later than 30 days after the commissioner has approved the request to modify the closure plan, if the change in the closure plan increases the cost of closure. The revised closure cost estimate must be adjusted for inflation as specified in paragraph (2) of this subdivision.
(4) The owner or operator must keep the following at the facility during the operating life of the facility: The latest cost estimate prepared in accordance with paragraphs (1) and (3) of this subdivision and, when this estimate has been adjusted in accordance with paragraph (2), the latest adjusted closure cost estimate.
(d) Financial assurance for closure. An owner or operator of each facility must establish financial assurance for closure of the facility. The owner or operator must choose from the options as specified in paragraphs (1) through (5) of this subdivision. An owner or operator may also use a combination of the options specified in paragraphs (1) through (8) to provide the total amount of financial assurance for the closure of the facility.
(i) An owner or operator may satisfy the requirements of this subdivision by establishing a closure trust fund which conforms to the requirements of this paragraph and submitting an originally signed duplicate of the trust agreement to the commissioner. An owner or operator of a new facility must submit the originally signed duplicate of the trust agreement to the commissioner at least 60 days before the date on which hazardous waste is first received for treatment, storage, or disposal. The trustee must be an entity which has the authority to act as a trustee and whose trust operations are regulated and examined by a Federal or State agency.
(ii) The wording of the trust agreement must be identical to the wording specified in paragraph (j)(1) of this section, and the trust agreement must be accompanied by a formal certification of acknowledgment (for example, see the end of paragraph (j)(1)). Schedule A of the trust agreement must be updated within 60 days after a change in the amount of the current closure cost estimate covered by the agreement.
('a') For a new or revenue-oriented facility, the first payment must be equal to the total closure cost estimate or; an alternative mechanism must be provided, which when combined with the trust fund, provides financial assurance for an amount at least equal to the current closure cost estimate. For a new facility, this payment will be made before the initial receipt of hazardous waste for treatment, storage or disposal. A receipt from the trustee for this payment must be submitted by the owner or operator to the Commissioner of Environmental Conservation before this initial receipt of hazardous waste. For a revenue-oriented facility the first payment is due 90 days after the date that these regulations are promulgated.
('b') For an existing facility which is not revenue-oriented, the first payment must be at least equal to the current closure cost estimate, except as provided in paragraph (6) of this subdivision, divided by the number of years in the pay-in period. Subsequent payments must be made no later than 30 days after each anniversary date of the first payment. The amount of each subsequent payment must be determined by this formula:
('c') If an owner or operator establishes a trust fund as specified in this paragraph, and the value of that trust fund is less than the current closure cost estimate when a permit is awarded for the facility, the amount of the current closure cost estimate still to be paid into the trust fund must be paid in over the pay-in period as defined in this subparagraph. Payments must continue to be made no later than 30 days after each anniversary date of the first payment made pursuant to Subpart 373-3 of this Part. The amount of each payment must be determined by this formula:
(iv) The owner or operator may accelerate payments into the trust fund or may deposit the full amount of the current closure cost estimate at the time the fund is established. However, the owner or operator must maintain the value of the fund at not less than the value that the fund would have if annual payments were made as specified in subparagraph (iii) of this paragraph.
(v) If the owner or operator established a closure trust fund after having used one or more alternate mechanisms specified in this section or in section 373-3.8(d) of this Part, the first payment must be in at least the amount that the fund would contain if the trust fund were established initially and annual payments made according to specifications of this paragraph and section 373-3.8(d)(1), as applicable.
(vi) After the pay-in period is completed, whenever the current closure cost estimate changes, the owner or operator must compare the new estimate with the trustee's most recent annual valuation of the trust fund. If the value of the fund is less than the amount of the new estimate, the owner or operator, within 60 days after the change in the cost estimate, must either deposit an amount into the fund so that its value after this deposit at least equals the amount of the current closure cost estimate, or obtain other financial assurance as specified in this subdivision to cover the difference.
(ix) Within 60 days after receiving a request from the owner or operator for release of funds as specified in subparagraphs (vii) and (viii) of this paragraph, the commissioner will instruct the trustee to release to the owner or operator such funds as the commissioner specifies in writing.
(x) After beginning partial or final closure, an owner or operator or another person authorized to conduct partial or final closure may request reimbursements for partial or final closure expenditures by submitting itemized bills to the commissioner. The owner or operator may request reimbursement for partial closure only if sufficient funds are remaining in the trust fund to cover the maximum costs of closing the facility over its remaining operating life. Within 60 days after receiving bills for partial or final closure activities, the commissioner will instruct the trustee to make reimbursements in those amounts as the commissioner specifies in writing, if the commissioner determines that the partial or final closure expenditures are in accordance with the approved closure plan, or otherwise justified. If the commissioner has reason to believe that the maximum cost of closure over the remaining life of the facility will be significantly greater than the value of the trust fund, the commissioner may withhold reimbursements of such amounts as he or she deems prudent until the commissioner determines, in accordance with paragraph (8) of this subdivision, that the owner or operator is no longer required to maintain financial assurance for final closure of the facility. If the commissioner does not instruct the trustee to make such reimbursements, the commissioner will provide the owner or operator with a detailed written statement of reasons.
(i) An owner or operator may satisfy the requirements of this subdivision by obtaining a surety bond which conforms to the requirements of this paragraph and submitting the bond to the commissioner. An owner or operator of a new facility must submit the bond to the commissioner at least 60 days before the date on which hazardous waste is first received for treatment, storage, or disposal. The bond must be effective before this initial receipt of hazardous waste. The surety company issuing the bond must, at a minimum, be among those listed as acceptable sureties on Federal bonds in Circular 570 of the U.S. Department of the Treasury.
(ii) The wording of the surety bond must be identical to the wording specified in paragraph (j)(2) of this section.
('2') updating of Schedule A of the trust agreement (see paragraph (j)(1) of this section) to show current closure cost estimates;
(viii) Under the terms of the bond, the surety may cancel the bond by sending notice of cancellation by "certified mail, return receipt requested" to the owner or operator and to the commissioner. Cancellation may not occur, however, during the 120 days beginning on the date of receipt of the notice of cancellation by both the owner or operator and the commissioner, as evidenced by the return receipts.
(i) An owner or operator may satisfy the requirements of this subdivision by obtaining an irrevocable standby letter of credit which conforms to the requirements of this paragraph and submitting the letter to the commissioner. An owner or operator of a new facility must submit the letter of credit to the commissioner at least 60 days before the date on which hazardous waste is first received for treatment, storage, or disposal. The letter of credit must be effective before this initial receipt of hazardous waste. The issuing institution must be an entity which has the authority to issue letters of credit and whose letter-of-credit operations are regulated and examined by a Federal or State agency.
(ii) The wording of the letter of credit must be identical to the wording specified in paragraph (j)(3) of this section.
(iii) An owner or operator who uses a letter of credit to satisfy the requirements of this subdivision must also establish a standby trust fund. Under the terms of the letter of credit, all amounts paid pursuant to a draft by the commissioner will be deposited by the issuing institution directly into the standby trust fund in accordance with instructions from the commissioner. This standby trust fund must meet the requirements of the trust fund specified in paragraph (1) of this subdivision, except that:
('2') updating of Schedule A of the trust agreement (see paragraph (j)(1) of this subdivision) to show current closure cost estimates;
(v) The letter of credit must be irrevocable and issued for a period of at least 1 year. The letter of credit must provide that the expiration date will be automatically extended for a period of at least 1 year unless, at least 120 days before the current expiration date, the issuing institution notifies both the owner or operator and the commissioner by "certified mail, return receipt requested," of a decision not to extend the expiration date. Under the terms of the letter of credit, the 120 days will begin on the date when both the owner or operator and the commissioner have received the notice, as evidenced by the return receipts.
(vi) The letter of credit must be issued in an amount at least equal to the current closure estimate, except as provided in paragraph (6) of this subdivision.
(viii) Following a determination pursuant to section 373-2.7 of this Subpart that the owner or operator has failed to perform final closure in accordance with the closure plan and other permit requirements when required to do so, the commissioner may draw on the letter of credit.
(ix) If the owner or operator does not establish alternate financial assurance as specified in this subdivision and obtain written approval of such alternate assurance from the commissioner within 90 days after receipt by both the owner or operator and the commissioner of a notice from issuing institution that it has decided not to extend the letter of credit beyond the current expiration date, the commissioner will draw on the letter of credit. The commissioner may delay the drawing if the issuing institution grants an extension of the term of the credit. During the last 30 days of any such extension the commissioner will draw on the letter of credit if the owner or operator has failed to provide alternate financial assurance as specified in this subdivision and obtain written approval of such assurance from the commissioner.
(i) An owner or operator may satisfy the requirements of this subdivision by obtaining closure insurance which conforms to the requirements of this paragraph and submitting a certificate of such insurance to the commissioner. An owner or operator of a new facility must submit the certificate of insurance to the commissioner at least 60 days before the date on which hazardous waste is first received for treatment, storage, or disposal. The insurance must be effective before this initial receipt of hazardous waste. At a minimum, the insurer must be authorized by the superintendent of the New York State Department of Insurance to conduct the business of insurance, or eligible to provide insurance as an excess or surplus lines insurer, in New York State.
(ii) The wording of the certificate of insurance must be identical to the wording specified in paragraph (j)(4) of this section.
(iii) The closure insurance policy must be issued for a face amount at least equal to the current closure cost estimate, except as provided in paragraph (6) of this subdivision. The term "limits of liability" means the total amount the insurer is obligated to pay under the policy. Actual payments by the insurer will not change the limits of liability, although the insurer's future liability will be lowered by the amount of the payments.
(v) After beginning partial or final closure, an owner or operator or any other person authorized to conduct closure may request reimbursements for closure expenditures by submitting itemized bills to the commissioner. The owner or operator may request reimbursements for partial closure only if the remaining value of the policy is sufficient to cover the maximum costs of closing the facility over its remaining operating life. Within 60 days after receiving bills for closure activities, the commissioner will instruct the insurer to make reimbursements in such amounts as the commissioner specifies in writing, if the commissioner determines that the partial or final closure expenditures are in accordance with the approved closure plan or otherwise justified. If the commissioner has reason to believe that the maximum cost of closure over the remaining life of the facility will be significantly greater than the face amount of the policy, the commissioner may withhold reimbursements of such amounts as he or she deems prudent until the commissioner determines, in accordance with paragraph (8) of this subdivision, that the owner or operator is no longer required to maintain financial assurance for final closure of the facility. If the commissioner does not instruct the insurer to make such reimbursements, the commissioner will provide the owner or operator with a detailed written statement of reasons.
(viii) The policy must provide that the insurer may not cancel, terminate, or fail to renew the policy except for failure to pay the premium. The automatic renewal of the policy must, at a minimum, provide the insured with the option of renewal at the limits of liability of the expiring policy. If there is a failure to pay the premium, the insurer may elect to cancel, terminate, or fail to renew the policy by sending notice by "certified mail, return receipt requested," to the owner or operator and the commissioner. Cancellation, termination, or failure to renew may not occur, however, during the 120 days beginning with the date of receipt of the notice by both the commissioner and the owner or operator, as evidenced by the return receipts. Cancellation, termination, or failure to renew may not occur and the policy will remain in full force and effect in the event that on or before the date of expiration:
(ix) Whenever the current closure cost estimate increases to an amount greater than the limits of liability of the policy, the owner or operator, within 60 days after the increase, must either cause the limits of liability to be increased to an amount at least equal to the current closure cost estimate and submit evidence of such increase to the commissioner, or obtain other financial assurance as specified in this subdivision to cover the increase. Whenever the current closure cost estimate decreases, the limits of liability may be reduced to the amount of the current closure cost estimate following written approval by the commissioner.
(i) An owner or operator of a facility which is not a revenue-oriented facility, may satisfy the requirements of this subdivision by demonstrating that the owner or operator passes a financial test as specified in this paragraph. No revenue-oriented facilities will be allowed to use this financial assurance mechanism. To pass this test the owner or operator must meet the criteria of either clause ('a') or ('b') of this subparagraph.
('1') two of the following three ratios: a ratio of total liabilities to net worth less than 2.0; a ratio of the sum of net income plus depreciation, depletion, and amortization to total liabilities greater than 0.1; and a ratio of current assets to current liabilities greater than 1.5; and
('4') assets 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.
('1') a current rating for their 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;
('4') 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 costs.
(ii) The phrases "current closure and post-closure cost estimates" and "current plugging and abandonment cost estimates" as used in subparagraph (i) of this paragraph refers to the cost estimates required to be shown in paragraphs 1-4 of the letter from the owner's or operator's chief financial officer.
('a') a letter signed by the owner's or operator's chief financial officer and worded as specified in paragraph (j)(5) of this section;
(iv) An owner or operator of a new facility must submit the items specified in subparagraph (5) of this paragraph to the commissioner at least 60 days before the date on which hazardous waste is first received for treatment, storage, or disposal.
(vi) If the owner or operator no longer meets the requirements of subparagraph (i) of this paragraph, the owner or operator must send notice to the commissioner of intent to establish alternate financial assurance as specified in this subdivision. The notice must be sent by "certified mail, return receipt requested" within 90 days after the end of the fiscal year for which the year-end financial data show that the owner or operator no longer meets the requirements. The owner or operator must provide the alternate financial assurance within 120 days after the end of such fiscal year.
(vii) The commissioner may, based on a reasonable belief that the owner or operator may no longer meet the requirement of subparagraph (i) of this paragraph, require reports of financial condition at any time from the owner or operator in addition to those specified in subparagraph (iii) of this paragraph. If the commissioner finds, on the basis of such reports or other information that the owner or operator no longer meets the requirements of subparagraph (i) of this paragraph, the owner or operator must provide alternate financial assurance as specified in this subdivision within 30 days after notification of such a finding.
(viii) The commissioner may disallow use of this test on the basis of qualifications in the opinion expressed by the independent certified public accountant in his or her report on examination of the owner's or operator's financial statements (see clause (iii)('b') of this paragraph). An adverse opinion or a disclaimer of opinion will be cause for disallowance. The commissioner will evaluate other qualifications on an individual basis. The owner or operator must provide alternate financial assurance as specified in this subdivision within 30 days after notification of the disallowance.
('a') an owner or operator substitutes alternate financial assurance as specified in the subdivision; or
(x) An owner or operator of a facility which is not a revenue-oriented facility may meet the requirements of this subdivision by obtaining a written guarantee, hereafter referred to as "guarantee." If the firm which is providing the guarantee does not meet the definition of "revenue-oriented" in section 373-2.8 or 373-3.8, it may provide the guarantee on behalf of the owner or operator even if the owner or operator is a "revenue-oriented" facility. However, the financial statement of the owner or operator cannot be consolidated with the financial statement of the guarantor. The guarantor must be the direct or higher-tier parent corporation of the owner or operator, a firm whose parent corporation is also the parent corporation of the owner or operator, or a firm with a "substantial business relationship" with the owner or operator. The guarantor must meet the requirements for owners or operators in subparagraphs (i) through (viii) of this paragraph and must comply with the terms of the guarantee. The wording of the guarantee must be identical to the wording specified in paragraph 373-2.8(j)(6) of this Part. A certified copy of the guarantee must accompany the items sent to the commissioner as specified in subparagraph (iii) of this paragraph. One of these items must be the letter from the guarantor's chief financial officer. If the guarantor's parent corporation is also the parent corporation of the owner or operator, the letter must describe the value received in consideration of the guarantee. If the guarantor is a firm with a "substantial business relationship" with the owner or operator, this letter must describe this "substantial business relationship" and the value received in consideration of the guarantee. The terms of the guarantee must provide that:
('a') If the owner or operator fails to perform final closure of a facility covered by the guarantee in accordance with the closure plan and other permit requirements whenever required to do so, the guarantor will do so or make payment as the commissioner shall direct in writing.
('c') If the owner or operator fails to provide alternate financial assurance as specified in this subdivision and obtain the written approval of such alternate assurance from the commissioner within 90 days after receipt by both the owner or operator and the commissioner of a notice of cancellation of the guarantee from the guarantor, the guarantor will provide such alternative financial assurance in the name of the owner or operator.
(6) Use of multiple financial mechanisms. An owner or operator may satisfy the requirements of this subdivision by establishing more than one financial mechanism per facility. These mechanisms are limited to trust funds, surety bonds, letters of credit, and insurance. The mechanisms must be as specified in paragraphs (1), (2), (3) and (4), respectively, of this subdivision, except that it is the combination of mechanisms, rather than the single mechanism, which must provide financial assurance for an amount at least equal to the current closure cost estimate. If an owner or operator uses a trust fund in combination with a surety bond or a letter of credit, the trust fund may be used as the standby trust fund for the other mechanisms. A single standby trust fund, if required, may be established for two or more mechanisms. The commissioner may use any or all of the mechanisms to provide for closure of the facility.
(7) Use of a financial mechanism for multiple facilities. An owner or operator may use a financial assurance mechanism specified in this subdivision to meet the requirements of this subdivision for more than one facility. Evidence of financial assurance submitted to the commissioner must include a list showing, for each facility, the EPA identification number, name, address, and the amount of funds for closure assured by the mechanism. The amount of funds available through the mechanisms must be no less than the sum of funds that would be available if a separate mechanism had been established and maintained for each facility. In directing funds available through the mechanisms for closure of any of the facilities covered by the mechanism, the commissioner may direct only the amount of funds designated for that facility, unless the owner or operator agrees to the use of additional funds available under the mechanism.
(8) Release of the owner or operator from the requirements of this subdivision. Within 60 days after receiving certifications from the owner or operator and an independent professional engineer registered in New York that final closure has been completed in accordance with the approved closure plan, the commissioner will notify the owner or operator in writing that the owner or operator is no longer required by this subdivision to maintain financial assurance for final closure of the facility, unless the commissioner has reason to believe that final closure has not been in accordance with the approved closure plan. The commissioner shall provide the owner or operator a detailed written statement of any reason to believe that closure has not been in accordance with the approved closure plan.
(1) The owner or operator of a disposal surface impoundment, disposal miscellaneous unit, land treatment unit, or landfill unit, or of a surface impoundment or waste pile required under subdivisions 373-2.11(f) and 373-2.12(h) of this Subpart to prepare a contingent closure and post-closure plan must have a detailed written estimate, in current dollars, of the annual cost of post-closure monitoring and maintenance of the facility in accordance with the applicable post-closure regulations in subdivisions 373-2.7(g), (h), (i) and (j), 373-2.11(f), 373-2.12(h), 373-2.13(h), 373-2.14(g) and 373-2.24(d) of this Subpart.
(2) During the active life of the facility, the owner or operator must adjust the post-closure cost estimate for inflation within 60 days prior to the anniversary date of the establishment of the financial instruments used to comply with section 373-2.8(f) of this Subpart. For owners or operators using the financial test or corporate guarantee, the post-closure cost estimate must be updated for inflation within 30 days after the close of the firm's fiscal year and before submission of updated information to the commissioner as specified in section 373-2.8(f)(5)(v) of this Subpart. The adjustment may be made by recalculating the post-closure cost estimate in current dollars, or by using an inflation factor derived from the most recent Implicit Price Deflator for Gross National Product published by the U.S. Department of Commerce in its Survey of Current Business, as specified in subparagraphs (i) and (ii) of this paragraph. The inflation factor is the result of dividing the latest published annual deflator by the deflator for the previous year.
(3) During the active life of the facility, the owner or operator must revise the post-closure cost estimate no later than 30 days after the commissioner has approved the request to modify the post-closure plan, if the change in the post-closure plan increases the cost of post-closure care. The revised post-closure cost estimate must be adjusted for inflation as specified in paragraph (2) of this subdivision.
(f) Financial assurance for post-closure care. The owner or operator of a hazardous waste management unit subject to the requirements of subdivision (e) of this section must establish financial assurance for post-closure care in accordance with the approved post-closure plan for the facility 60 days prior to the initial receipt of hazardous waste or the effective date of regulation, whichever is later. The owner or operator must choose from the following options:
(i) An owner or operator may satisfy the requirements of this subdivision by establishing a post-closure trust fund which conforms to the requirements of this paragraph and submitting an originally signed duplicate of the trust agreement of the commissioner. An owner or operator of a new facility must submit the originally signed duplicate of the trust agreement to the commissioner at least 60 days before the date on which hazardous waste is first received for disposal. The trustee must be an entity which has the authority to act as a trustee and whose trust operations are regulated and examined by a Federal or State agency.
(ii) The wording of the trust agreement must be identical to the wording specified in paragraph (j)(1) of this section, and the trust agreement must be accompanied by a formal certification of acknowledgment (for example, see paragraph (j)(1)). Schedule A of the trust agreement must be updated within 60 days after a change in the amount of the current post-closure cost estimate covered by the agreement.
('a') For a new revenue-oriented facility, the first payment must be equal to the total post-closure cost estimate, or an alternative mechanism must be provided which when combined with the trust fund, provides financial assurance for an amount at least equal to the current closure cost estimate.
('b') For a new facility, the first payment must be made before the initial receipt of hazardous waste. For a revenue-oriented facility the first payment is due 90 days after the date that these regulations are promulgated. For existing facilities which are not revenue-oriented facilities, the first payment must be at least equal to the current post-closure cost estimate, except as provided in paragraph (6) of this subdivision, divided by the number of years in the pay-in period. Subsequent payments must be made no later than 30 days after each anniversary date of the first payment. The amount of each subsequent payment must be determined by this formula:
('c') If an owner or operator establishes a trust fund as specified in this paragraph, and the value of that trust fund is less than the current post-closure cost estimate when a permit is awarded for the facility, the amount of the current post-closure cost estimate still to be paid into the trust fund must be paid in over the pay-in period as defined in this subparagraph. Payments must continue to be made no later than 30 days after each anniversary date of the first payment made pursuant to this Subpart. The amount of each payment must be determined by this formula:
(iv) The owner or operator may accelerate payments into the trust fund or may deposit the full amount of the current post-closure cost estimate at the time the fund is established. However, the owner or operator must maintain the value of the fund at not less than the value that the fund would have if annual payments were made as specified in subparagraph (iii) of this paragraph.
(v) If the owner or operator established a post-closure trust fund after having used one or more alternate mechanisms specified in this subdivision or in section 373-3.8(f) of this Part, the first payment must be in at least the amount that the fund would contain if the trust fund were established initially and annual payments made according to specifications of this paragraph and section 373-3.8(f)(1), as applicable.
(xi) An owner or operator or another person authorized to conduct post-closure care may request reimbursements for post-closure care expenditures by submitting itemized bills to the commissioner. Within 60 days after receiving bills for post-closure care activities, the commissioner will instruct the trustee to make reimbursements in those amounts the commissioner specifies in writing, if the commissioner determines that the post-closure care expenditures are in accordance with the approved post-closure plan, or otherwise justified. If the commissioner does not instruct the trustee to make reimbursement, the commissioner will provide the owner or operator with a detailed written statement of reasons.
(xii) The commissioner will agree to termination of the trust when:
(i) An owner or operator may satisfy the requirements of this subdivision by obtaining a surety bond which conforms to the requirements of this paragraph and submitting the bond to the commissioner. An owner or operator of a new facility must submit the bond to the commissioner at least 60 days before the date on which hazardous waste is first received for disposal. The bond must be effective before this initial receipt of hazardous waste. The surety company issuing the bond must, at a minimum, be among those listed as acceptable sureties on Federal bonds in Circular 570 of the U.S. Department of the Treasury.
(iii) The owner or operator who uses a surety bond to satisfy the requirements of this subdivision must also establish a standby trust fund. Under the terms of the bond, all payments made thereunder will be deposited by the surety directly into the standby trust fund in accordance with instructions from the commissioner. This standby trust fund must meet the requirements specified in paragraph (1) of this subdivision except that:
('2') updating of Schedule A of the trust agreement (see paragraph (j)(1) of this section) to show current post-closure cost estimates;
(vi) The penal sum of the bond must be in an amount at least equal to the current post-closure cost estimate, except as provided in paragraph (6) of this subdivision.
(vii) Whenever the current post-closure cost estimate increases to an amount greater than the penal sum, the owner or operator, within 60 days after the increase, must either cause the penal sum to be increased to an amount at least equal to the current post-closure cost estimate and submit evidence of such increase to the commissioner, or obtain other financial assurance as specified in this subdivision to cover the increase. Whenever the current post-closure cost estimate decreases, the penal sum may be reduced to the amount of the current post-closure cost estimate following written approval by the commissioner.
(i) An owner or operator may satisfy the requirements of this subdivision by obtaining an irrevocable standby letter of credit which conforms to the requirements of this paragraph and submitting the letter to the commissioner. An owner or operator of a new facility must submit the letter of credit to the commissioner at least 60 days before the date on which hazardous waste is first received for disposal. The letter of credit must be effective before this initial receipt of hazardous waste. The issuing institution must be an entity which has the authority to issue letters of credit and whose letter of credit operations are regulated and examined by a Federal or State agency.
('2') updating of Schedule A of the trust agreement (see paragraph (j)(1) of this subdivision) to show current post-closure cost estimates;
(iv) The letter of credit must be accompanied by a letter from the owner or operator referring to the letter of credit by number, issuing institution, and date, and providing the following information: the EPA identification number, name, and address of the facility, and the amount of funds assured for post-closure of the facility by the letter of credit.
(vi) The letter of credit must be issued in an amount at least equal to the current post-closure estimate, except as provided in paragraph (6) of this subdivision.
(ix) Following a determination pursuant to section 373-2.7 of this Subpart that the owner or operator has failed to perform post-closure care in accordance with the post-closure plan and other permit requirements, the commissioner may draw on the letter of credit.
(x) If the owner or operator does not establish alternate financial assurance as specified in this subdivision and obtain written approval of such alternate assurance from the commissioner within 90 days after receipt by both the owner or operator and the commissioner of a notice from issuing institution that it has decided not to extend the letter of credit beyond the current expiration date, the commissioner will draw on the letter of credit. The commissioner may delay the drawing if the issuing institution grants an extension of the term of the credit. During the last 30 days of any such extension the commissioner will draw on the letter of credit if the owner or operator has failed to provide alternate financial assurance as specified in this subdivision and obtain written approval of such assurance from the commissioner.
(i) An owner or operator may satisfy the requirements of this subdivision by obtaining post-closure insurance which conforms to the requirements of this paragraph and submitting a certificate of such insurance to the commissioner. An owner or operator of a new facility must submit the certificate of insurance to the commissioner at least 60 days before the date on which hazardous waste is first received for disposal. The insurance must be effective before this initial receipt of hazardous waste. At a minimum, the insurer must be authorized by the superintendent of the New York State Department of Insurance to conduct the business of insurance, or eligible to provide insurance as an excess or surplus lines insurer, in New York State.
(iii) The post-closure insurance policy must be issued for a face amount at least equal to the current post-closure cost estimate, except as provided in paragraph (6) of this subdivision. The term "limits of liability" means the total amount the insurer is obligated to pay under the policy. Actual payments by the insurer will not change the limits of liability, although the insurer's future liability will be lowered by the amount of the payments.
(iv) The post-closure insurance policy must guarantee that funds will be available to close the facility whenever the post-closure period begins. The policy must also guarantee that once post-closure begins, the insurer will be responsible for paying out funds, up to an amount equal to the limits of liability of the policy, upon the direction of the commissioner, to such party or parties as the commissioner specifies.
(v) An owner or operator or any other person authorized to conduct post-closure care may request reimbursements for post-closure care expenditures by submitting itemized bills to the commissioner. Within 60 days after receiving bills for post-closure care activities, the commissioner will instruct the insurer to make reimbursement in such amounts as the commissioner specified in writing, if the commissioner determines that the post-closure care expenditures are in accordance with the approved post-closure plan or otherwise justified. If the commissioner does not instruct the insurer to make such reimbursement, the commissioner will provide the owner or operator with a detailed written statement of reasons.
(vi) The owner or operator must maintain the policy in full force and effect until the commissioner consents to termination of the policy by the owner or operator as specified in subparagraph (xi) of this paragraph. Failure to pay the premium, without substitution of alternate financial assurance as specified in this subdivision, will constitute a significant violation of these regulations, warranting such remedy as the commissioner deems necessary. Such violation will be deemed to begin upon receipt by the commissioner of a notice of future cancellation, termination, or failure to renew due to nonpayment of the premium, rather than upon the date of expiration.
('a') the commissioner deems the facility abandoned;
('b') the permit is terminated or revoked or a new permit is denied;
('c') closure is ordered by the commissioner or a U.S. District court or other court of competent jurisdiction;
(ix) Whenever the current post-closure cost estimate increases to an amount greater than the limits of liability of the policy, the owner or operator, within 60 days after the increase, must either cause the limits of liability to be increased to an amount at least equal to the current post-closure cost estimate and submit evidence of such increase to the commissioner, or obtain other financial assurance as specified in this subdivision to cover the increase. Whenever the current post-closure cost estimate decreases during the operating life of the facility, the limits of liability may be reduced to the amount of the current post-closure cost estimate following written approval by the commissioner.
('4') assets located in the United States amounting to at least 90 percent of the total assets or at least six times the sum of the current closure and post-closure cost estimates and the current plugging and abandonment costs.
(ii) The phrases "current closure and post-closure cost estimates" and "current plugging and abandonment cost estimates" as used in subparagraph (i) of this paragraph refer to the cost estimates required to be shown in paragraphs 1-4 of the letter from the owner's or operator's chief financial officer.
(iv) An owner or operator of a new facility must submit the items specified in subparagraph (iii) of this paragraph to the commissioner at least 60 days before the date on which hazardous waste is first received for disposal.
(ix) During the period of post-closure care, the commissioner may approve a decrease in the current post-closure cost estimate for which this test demonstrates financial assurance if the owner or operator demonstrates to the commissioner that the amount of the cost estimate exceeds the remaining cost of post-closure care.
(x) The owner or operator is no longer required to submit the items specified in subparagraph (iii) of this paragraph when:
(xi) An owner or operator of a facility which is not a revenue-oriented facility may meet the requirements of this subdivision by obtaining a written guarantee, hereafter referred to as "guarantee." If the firm which is providing the guarantee does not meet the definition of "revenue-oriented" in section 373-2.8 or 373-3.8, it may provide the guarantee on behalf of the owner or operator even if the owner or operator is a "revenue-oriented" facility. However, the financial statement of the owner or operator cannot be consolidated with the financial statement of the guarantor. The guarantor must be the direct or higher-tier parent corporation of the owner or operator, a firm whose parent corporation is also the parent corporation of the owner or operator, or a firm with a "substantial business relationship" with the owner or operator. The guarantor must meet the requirements for owners or operators in subparagraphs (i) through (ix) of this paragraph and must comply with the terms of the guarantee. The wording of the guarantee must be identical to the wording specified in paragraph 373-2.8(j)(6) of this Part. A certified copy of the guarantee must accompany the items sent to the commissioner as specified in subparagraph (iii) of this paragraph. One of these items must be the letter from the guarantor's chief financial officer. If the guarantor's parent corporation is also the parent corporation of the owner or operator, the letter must describe the value received in consideration of the guarantee. If the guarantor is a firm with a "substantial business relationship" with the owner or operator, this letter must describe this "substantial business relationship" and the value received in consideration of the guarantee. The terms of the guarantee must provide that:
('a') If the owner or operator fails to perform post-closure care of a facility covered by the guarantee in accordance with the post-closure plan and other permit requirements whenever required to do so, the guarantor will do so or make payment as the commissioner shall direct, in writing.
('b') The guarantee will remain in force unless the guarantor sends notice of cancellation by certified mail, return receipt requested to the owner or operator and to the commissioner. Cancellation may not occur, however, during the 120 days beginning on the date of receipt of the notice of cancellation by both the owner or operator and the commissioner, as evidenced by the return receipts.
(6) Use of multiple financial mechanisms. An owner or operator may satisfy the requirements of this subdivision by establishing more than one financial mechanism per facility. These mechanisms are limited to trust funds, surety bonds, letters of credit, and insurance. The mechanisms must be as specified in paragraphs (1), (2), (3) and (4), respectively, of this subdivision, except that it is the combination of mechanisms, rather than the single mechanism, which must provide financial assurance for an amount at least equal to the current post-closure cost estimate. If an owner or operator uses a trust fund in combination with a surety bond or a letter of credit, the trust fund may be used as the standby trust fund for the other mechanisms. A single standby trust fund, if required, may be established for two or more mechanisms. The commissioner may use any or all of the mechanisms to provide for post-closure care of the facility.
(7) Use of a financial mechanism for multiple facilities. An owner or operator may use a financial assurance mechanism specified in this subdivision to meet the requirements of this subdivision for more than one facility. Evidence of financial assurance submitted to the commissioner must include a list showing, for each facility, the EPA identification number, name, address, and the amount of funds for closure assured by the mechanism. The amount of funds available through the mechanisms must be no less than the sum of funds that would be available if a separate mechanism had been established and maintained for each facility. In directing funds available through the mechanisms for post-closure care of any of the facilities covered by the mechanism, the commissioner may direct only the amount of funds designated for that facility, unless the owner or operator agrees to the use of additional funds available under the mechanism.
(8) Release of the owner or operator from the requirements of this subdivision. Within 60 days after receiving certifications from the owner or operator and an independent professional engineer registered in New York that the post-closure care period has been completed for a hazardous waste disposal unit in accordance with the approved post-closure plan, the commissioner will notify the owner or operator in writing that the owner or operator is no longer required by this subdivision to maintain financial assurance for post-closure care of that unit, unless the commissioner has reason to believe that post-closure care has not been in accordance with the approved post-closure plan. The commissioner shall provide the owner or operator a detailed written statement of any such reason to believe that post-closure care has not been in accordance with the approved post-closure plan.
(g) Use of a mechanism for financial assurance of both closure and post-closure care. An owner or operator may satisfy the requirements for financial assurance for both closure and post-closure care for one or more facilities by using a trust fund, surety bond, letter of credit, insurance, financial test, or corporate guarantee that meets the specifications for the mechanism in both (d) and (f) of this section. The amount of funds available through the mechanism must be no less than the sum of funds that would be available if a separate mechanism had been established and maintained for financial assurance of closure and post-closure care.
(1) Coverage for sudden accidental occurrences. An owner or operator of a hazardous waste treatment, storage or disposal facility or a group of such facilities, must demonstrate financial responsibility for bodily injury and property damage to third parties caused by sudden accidental occurrences arising from operations of the facility or group of facilities. The owner or operator must have and maintain liability coverage for sudden accidental occurrences in the amount of at least $1 million per occurrence with an annual aggregate of at least $2 million, exclusive of legal defense costs. This liability coverage may be demonstrated as specified in subparagraphs (i), (ii), (iii), (iv), (v) and (vi) of this paragraph:
(i) An owner or operator may demonstrate the required liability coverage by having liability insurance as specified in this subparagraph.
('a') Each insurance policy must be amended by attachment of the Hazardous Waste Facility Liability Endorsement or evidenced by a Certificate of Liability insurance. The wording of the endorsement must be identical to the wording specified in paragraph (j)(7) of this section. The wording of the certificate of insurance must be identical to the wording specified in paragraph (j)(8). The owner or operator must submit a signed duplicate original of the endorsement or the certificate of insurance to the Commissioner. If requested by the Commissioner the owner or operator must provide a signed duplicate original of the insurance policy. An owner or operator of a new facility must submit the signed duplicate original of the Hazardous Waste Facility Liability Endorsement or the Certificate of Liability Insurance to the Commissioner at least 60 days before the date on which hazardous waste is first received for treatment, storage or disposal. The insurance must be effective before this initial receipt of hazardous waste.
('b') Each insurance policy must be issued by an insurer which, at a minimum, is licensed to transact the business of insurance, or authorized to provide insurance as an excess or surplus lines insurer within New York State, by the superintendent of the New York State Department of Insurance.
(ii) An owner or operator of a facility which is not a revenue-orient\ facility, may meet the requirements of this paragraph by passing a financial test or using the guarantee for liability coverage as specified in paragraphs (6) and (7) of this subdivision. If the firm which is providing the guarantee does not meet the definition of "revenue-oriented" in section 373-2.8 or 373-3.8, it may provide the guarantee on behalf of the owner or operator even if the owner or operator is a "revenue-oriented" facility. However, the financial statement of the owner or operator cannot be consolidated with the financial statement of the guarantor.
('c') a final court order establishing a judgment for bodily injury or property damage caused by a sudden or non-sudden accidental occurrence arising from the operation of a hazardous waste treatment, storage, or disposal facility is issued against the owner or operator or an instrument that is providing financial assurance for liability coverage under subparagraphs (1)(i) through (1)(vi) of this subdivision.
(2) Coverage for nonsudden accidental occurrences. An owner or operator of a surface impoundment, landfill, land treatment facility, or disposal miscellaneous unit that is used to manage hazardous waste, or a group of such facilities, must demonstrate financial responsibility for bodily injury and property damage to third parties caused by nonsudden accidental occurrences arising from operations of the facility or group of facilities. The owner or operator must have and maintain liability coverage for nonsudden accidental occurrences in the amount of at least $4.5 million per occurrence with an annual aggregate of at least $9 million, exclusive of legal defense costs, for each separate facility in New York State. An owner or operator who must meet the requirements of this paragraph may combine the required per occurrence coverage levels for sudden and nonsudden accidental occurrences into a single per-occurrence level, and combine the required annual aggregate coverage levels for sudden and nonsudden accidental occurrences into a single annual aggregate level. Owners or operators who combine coverage levels for sudden and nonsudden accidental occurrences must maintain liability coverage in the amount of at least $5.5 million per occurrence and $11 million annual aggregate. This liability coverage may be demonstrated as specified in subparagraphs (i), (ii), (iii), (iv), (v) or (vi) of this paragraph:
('a') Each insurance policy must be amended by attachment of the Hazardous Waste Facility Liability Endorsement or evidenced by a Certificate of Liability Insurance. The wording of the endorsement must be identical to the wording specified in paragraph (j)(7) of this section. The wording of the certificate of insurance must be identical to the wording specified in paragraph (j)(8). The owner or operator must submit a signed duplicate original of the endorsement or the certificate of insurance to the Commissioner. If requested by the Commissioner, the owner or operator must provide a signed duplicate original of the insurance policy. An owner or operator of a new facility must submit the signed duplicate original of the Hazardous Waste Facility Liability Endorsement or the Certification of Liability Insurance to the Commissioner at least 60 days before the date on which hazardous waste is first received for treatment, storage or disposal. The insurance must be effective before this initial receipt of hazardous waste.
('b') Each insurance policy must be issued by an insurer which, at a minimum, is licensed to transact the business of insurance, or authorized to provide insurance as an excess or surplus lines insurer, within New York State, by the superintendent of the New York State Department of Insurance.
(ii) An owner or operator of a facility which is not a revenue-oriented facility may meet the requirements of this paragraph by passing a financial test or using the guarantee for liability coverage as specified in paragraphs (6) and (7) of this subdivision. If the firm which is providing the guarantee does not meet the definition of "revenue-oriented" in section 373-2.8 or 373-3.8, it may provide the guarantee on behalf of the owner or operator even if the owner or operator is a "revenue-oriented" facility. However, the financial statement of the owner or operator cannot be consolidated with the financial statement of the guarantor.
(vi) An owner or operator may demonstrate the required liability coverage through the use of combinations of insurance, financial test, guarantee, letter of credit, surety bond, and trust fund, except that the owner or operator may not combine a financial test covering part of the liability coverage requirement with a guarantee unless the financial statement of the owner or operator is not consolidated with the financial statement of the guarantor. The amounts of coverage demonstrated must total at least the minimum amount required by this paragraph. If the owner or operator demonstrates the required coverage through the use of a combination of financial assurances under this paragraph, the owner or operator shall specify at least one such assurance as "primary" coverage and shall specify other assurance as "excess" coverage. An owner or operator of a revenue-oriented facility may use all of the above-mentioned financial mechanisms except the financial test and/or guarantee.
(3) Request for variance. If an owner or operator can demonstrate to the satisfaction of the commissioner that the levels of financial responsibility required by paragraph (1) or (2) of this subdivision are not consistent with the degree and duration of risk associated with treatment, storage, or disposal at the facility or group of facilities, the owner or operator may obtain a variance from the commissioner. The request for a variance must be submitted to the commissioner as part of the application under section 373-1.5(a) of this Part for a facility that does not have a permit, or pursuant to the procedures for permit modification under section 373-1.7 for a facility that has a permit. If granted, the variance will take the form of an adjusted level of required liability coverage, such level to be based on the commissioner's assessment of the degree and duration of risk associated with the ownership or operation of the facility or group of facilities. The commissioner may require an owner or operator who requests a variance to provide such technical and engineering information as is deemed necessary by the commissioner to determine a level of financial responsibility other than that required by paragraph (1) or (2) of this subdivision. Any request for a variance for a permitted facility will be treated as a request for a permit modification under section 373-1.7.
(4) Adjustments by the commissioner. If the commissioner determines that the levels of financial responsibility required by paragraph (1) or (2) of this subdivision are not consistent with the degree and duration of risk associated with treatment, storage, or disposal at the facility or group of facilities, the commissioner may adjust the level of financial responsibility required under paragraph (1) or (2) of this subdivision as may be necessary to protect human health and the environment. This adjusted level will be based on the commissioner's assessment of the degree and duration of risk associated with the ownership or operation of the facility or group of facilities. In addition, if the commissioner determines that there is a significant risk to human health and the environment from non-sudden accidental occurrences resulting from the operations of a facility that is not a surface impoundment, landfill, or land treatment facility, the commissioner may require that an owner or operator of the facility comply with paragraph (2) of this subdivision. An owner or operator must furnish to the commissioner, within a reasonable time, any information which the commissioner requests to determine whether cause exists for such adjustments of level or type of coverage. Any adjustment of the level or type of coverage for a facility that has a permit will be treated as a permit modification under section 373-1.7 of this Part.
(5) Period of coverage. Within 60 days after receiving certifications from the owner or operator and an independent professional engineer registered in New York State that final closure has been completed in accordance with the approved closure plan, the commissioner will notify the owner or operator in writing that the owner or operator is no longer required by this subdivision to maintain liability coverage for that facility, unless the commissioner has reason to believe that closure has not been in accordance with the approved closure plan.
(6) Financial test for liability coverage. An owner or operator of a facility which is not a revenue-oriented facility, may satisfy the requirements of this subdivision by demonstrating that the owner or operator passes a financial test as specified in this paragraph. To pass this test the owner or operator must meet the criteria of subparagraph (i) or (ii) of this paragraph:
('b') tangible net worth at least $10 million; and
('c') tangible net worth at least six times the amount of liability coverage to be demonstrated by this test; and
('1') at least 90 percent of this total assets; or
('2') tangible net worth at least $10 million; and
('3') tangible net worth at least six times the amount of liability coverage to be demonstrated by this test.
(iii) The phrase "amount of liability coverage" as used in this paragraph refers to the annual aggregate amounts for which coverage is required under paragraphs (1) and (2) of this subdivision.
('a') a letter signed by the owner's or operator's chief financial officer and worded as specified in paragraph (j)(9) of this section. If an owner or operator is using the financial test to demonstrate both assurance for closure or post-closure care, as specified in paragraphs (d)(5) and (f)(5) of this section and paragraphs (d)(5) and (f)(5) of section 373-3.8 of this Part and liability coverage, the letter specified in paragraph (j)(9) of this section must be submitted to cover both forms of financial responsibility; a separate letter as specified in paragraph (j)(5) of this section is not required.
(v) An owner or operator of a new facility which is not a revenue-oriented facility, must submit the items specified in subparagraph (iv) of this paragraph to the commissioner at least 60 days before the date on which hazardous waste is first received for treatment, storage, or disposal.
(vi) After the initial submission of items specified in subparagraph (iv) of this paragraph, the owner or operator must send updated information to the commissioner within 90 days after the close of each succeeding fiscal year. This information must consist of all three items specified in subparagraph (iv) of this paragraph.
(vii) If the owner or operator no longer meets the requirements of subparagraph (i) of this paragraph, the owner or operator must obtain insurance, a letter of credit, a surety bond, a trust fund, or a guarantee for the entire amount of required liability coverage as specified in this subdivision. Evidence of liability coverage must be submitted to the commissioner within 90 days after the end of the fiscal year for which the year-end financial data show that the owner or operator no longer meets the test requirements.
(viii) The commissioner may disallow use of this test on the basis of qualifications in the opinion expressed by the independent certified public accountant in his or her report on examination of the owner's or operator's financial statements (see clause (iv)('b') of this paragraph). An adverse opinion or a disclaimer of opinion will be cause for disallowance. The commissioner will evaluate other qualifications on an individual basis. The owner or operator must provide alternate financial assurance as specified in this subdivision within 30 days after notification of the disallowance.
(i) An owner or operator may meet the requirements of this subdivision by obtaining a written guarantee, hereinafter referred to as "guarantee." The guarantor must be the direct or higher-tier parent corporation of the owner or operator, a firm whose parent corporation is also the parent corporation of the owner or operator, or a firm with a "substantial business relationship" with the owner or operator. The guarantor must meet the requirements for owners or operators in paragraph (h)(6) of this section. The wording of the guarantee must be identical to the wording specified in subparagraph (j)(6)(ii) of this section. A certified copy of the guarantee must accompany the items sent to the Commissioner as specified in subparagraph (6)(iv) of this subdivision. One of these items must be the letter from the guarantor's chief financial officer. If the guarantor's parent corporation is also the parent corporation of the owner or operator, this letter must describe the value received in consideration of the guarantee. If the guarantor is a firm with a "substantial business relationship" with the owner or operator, this letter must describe this "substantial business relationship" and the value received in consideration of the guarantee. The terms of the guarantee must provide that:
(iii) The wording of the letter of credit must be identical to the wording specified in paragraph (j)(10) of this section.
(v) The wording of the standby trust fund agreement must be identical to the wording specified in paragraph (j)(13) of this section.
(iii) The wording of the surety bond must be identical to the wording specified in paragraph (j)(11) of this section.
(iv) The wording of the trust fund must be identical to the wording specified in paragraph (j)(12) of this section.
(1) An owner or operator must notify the Commissioner by "certified mail, return receipt requested" of the commencement of a voluntary or involuntary proceeding under 11 USCA (Bankruptcy), naming the owner or operator as debtor, within 10 days after commencement of the proceeding. A guarantor of a guarantee as specified in paragraphs (d)(5) and (f)(5) of this section must make such a notification if the guarantor is named as debtor, as required under the terms of the guarantee (paragraph (j)(6) of this section).