Alabama Administrative Code › Title 880 - ALABAMA SURFACE MINING COMMISSION › Chapter 880-X-9C - BOND AND INSURANCE REQUIREMENTS FOR SURFACE COAL MINING AND RECLAMATION OPERATIONS FORM, CONDITIONS, AND TERMS OF PERFORMANCE BONDS AND LIABILITY INSURANCE › Section 880-X-9C-.03 - Terms And Conditions Of The Bond

Current through Register Vol. 42, No. 9, June 28, 2024
(1) The performance bond shall be in an amount determined by the State Regulatory Authority as provided in Rules 880-X-9B-.02 and 880-X-9B-.03.
(2) The performance bond shall be payable to the State Regulatory Authority.
(3) The performance bond shall be conditioned upon faithful performance of all of the requirements of the Act, these regulations, and the conditions of the permit and shall cover the affects on all lands disturbed by the surface coal mining operation or such parts of the operation pertinent to an increment.
(4) The duration of the bond shall be for the time period provided in Rule 880-X-9B-.04.
(5) Surety bonds shall be subject to the following conditions:
(a) The State Regulatory Authority shall not accept the bond of a surety company unless the bond shall not be cancellable by the surety at any time for any reason including, but not limited to non-payment of premium or bankruptcy of the permittee during the period of liability. Surety bond coverage for permitted lands not disturbed may be released with the consent of the Regulatory Authority pursuant to Rule 880-X-9D. The Regulatory Authority may approve a replacement bond release only if a replacement bond is filed by the permittee prior to the release date, or the permit is amended so that the surface coal mining operations approved under the permit are reduced to the degree necessary to cover all the cost attributable to the completion of reclamation operations on the reduced permit area in accordance with Rule 880-X-9B and the remaining performance bond liability.
(b) The Regulatory Authority shall not exceed a surety company's bond in excess of the company's maximum single obligation as provided by State law unless the surety company satisfies State law for exceeding that limit.
(c) The Regulatory Authority shall not accept surety bonds from a surety company for any person, on all permits held by that person, in excess of three times the company's maximum single obligation as provided by State law.
(d) The bond shall provide that the surety and the permittee shall be jointly and severally liable.
(e) The bond shall provide that --
1. The surety will give prompt notice to the permittee and the Regulatory Authority of any notice received or action filed alleging the Insolvency or bankruptcy of the surety, or alleging any violations of regulatory requirements which could result in suspension or revocation of the surety's license to do business;
2. In the event the surety becomes unable to fulfill its obligations under the bond for any reason, notice shall be given immediately to the permittee and the Regulatory Authority;
3. Upon the incapacity of a surety by reason of bankruptcy, insolvency, or suspension or revocation of its license, the permittee shall be deemed to be without bond coverage. The State Regulatory Authority shall issue a notice of violation to any operator who is without bond coverage which shall specify a reasonable period to replace bond coverage, not to exceed sixty (60) days. Such notice of violation, if abated within the period allowed, shall not be counted as a notice of violation for purposes of determining a pattern of willful violation under Rule 880-X-11C-.04 and need not be reported as a past violation in permit applications under Rule 880-X-8D-.06 and 880-X-8G-.06. If such a notice of violation is not abated in accordance with the schedule, a cessation order shall be issued.