632-037-0135 Financial Security (1) A reclamation bond or alternative security acceptable to the Department shall be posted before the start of any construction, excavation or other ground disturbing activity associated with mining operations, other than baseline data collection. "Alternative security" shall include certificates of deposit or irrevocable letters of credit issued by a federally-insured bank. The purpose of the financial security shall be to allow the Department to meet the requirements of the reclamation and closure plan and to provide protection of surface and subsurface resources. The amount of the financial security shall be calculated on the basis of the estimated actual cost of reclamation and closure and shall not be limited. The calculation shall also consider environmental protection costs based on the credible accident analysis and the factors listed in section (6) of this rule. (2) The Department shall assess annually the overall cost of reclamation. If changes in the operation or modifications to a permit cause the cost of reclamation to exceed the amount of the financial security currently held by the state, the permittee shall post an additional security for the difference. All reclamation calculations shall be approved by the Department. (3) The Department shall provide for incremental surety increases, with the level of surety required being consistent with the degree and forms of surface disturbance anticipated within a time period specified by the Department. When the actual surface area to be disturbed approaches the level expected by the Department, the permittee shall notify the Department sufficiently in advance of reaching the acreage limit specified to allow for a review of the surety requirements and posting of additional surety by the permittee prior to exceeding the acreage limit set by the Department. (4) If reclamation costs will exceed the posted financial security and the operator does not increase the amount of the financial security, the department and other permitting agencies shall suspend all permits until the permittee posts the additional financial security. (5) The Department may seek a lien against the assets of the permittee to cover the cost of reclamation if the financial security posted is insufficient. The amount of the lien shall be the amount of the costs incurred by the Department to complete reclamation. All current operating permits of the permittee shall be suspended and the Department shall deny immediately all pending applications of the permittee to conduct mining operations. (6) The factors the Department shall consider in determining the amount of the security may include but are not limited to the following: (a) The reclamation estimate submitted by the applicant as part of the consolidated application; (b) The impact analysis, including the credible accident analysis; (c) Supervision; (d) Mobilization; (e) Costs of equipment; (f) Costs of labor; (g) Removal or disposition of debris, junk, equipment, structures, foundations and unwanted chemicals; (h) Reduction or stabilization of hazards such as in-water slopes, highwalls, and landslides or other mass failure; (i) Disposition of oversize, rejects, scalpings and overburden; (j) Backfilling, contouring or regrading and topsoil replacement; (k) Draining, establishment of drainage and erosion control; (l) Soil tests; (m) Seedbed preparation, seeding, mulching, fertilizing, netting, tackifiers or other stabilizing agents; (n) Tree and shrub planting; (o) Fencing; (p) Liability insurance; (q) Long-term stabilization, control, containment or disposition of waste solids and liquids; (r) Final engineering design; (s) Costs of remedial measure identified to clean up releases of contaminants associated with mining, processing or beneficiation that are reasonably likely to cause a threat to public health, safety or the environment; (t) The estimated cost of detoxification or disposal of ore processing solutions and solution contaminated ore so as to meet the standards for reclamation approved for the operation in the operating permit issued by the Department and the standards established in ORS 517.952 to 517.989 and these rules; (u) The estimated cost of restoration of contaminated soil, surface and ground water or living resources within the standards established in ORS 517.952 to 517.989 and these rules should an accident occur at the site; (v) The estimated cost of removal and/or disposal of chemicals used on site; (w) The spill prevention plan; (x) Estimated Department-contracted service expenses including but not limited to supervision, mobilization, labor and equipment needs of the department for decontamination and restoration should the Department be required to perform such restoration. (7) Cost estimate information shall be derived from sources such as: (a) Comparable costs from similar projects; (b) Catalog prices; (c) Guides and cost estimates obtained from appropriate government, public and private sources; (d) Site test and monitoring data; (e) Operator estimates; and (f) Equipment handbooks. (8) Using the reclamation estimate submitted in the consolidated application and the impact analysis as a guide, the Department shall distribute an initial determination of the amount of financial security necessary to implement the reclamation and closure plans and to protect human health and the environment to all permitting and cooperating agencies for review and comment. After considering the comments of such agencies, the Department shall set the amount of financial security and notify the applicant. (9) The financial security acceptable to the Department shall be posted before the start of any construction, excavation or other ground disturbing activity associated with mining activities other than baseline data collection activities. No permit shall be issued or renewed until all financial security for a mining operation is on file with the Department. Bonds or other securities shall be maintained until operations have ceased, reclamation has been completed and all decommissioning performance standards have been met. Bonds shall be United States Treasury listed, provided by surety companies licensed to operate in Oregon and acceptable to the Department. A mining operation may not satisfy the financial security requirements through self-insurance. (10) The Department may require financial security or an annuity for post-reclamation monitoring and care. Statutory/Other Authority: ORS 517.750 - 517.995 Statutes/Other Implemented: ORS 517.987 History: DGMI 1-2014, f. & cert. ef. 4-2-14 GMI 2-1991, f. & cert. ef. 10-11-91