Hawaii Administrative Rules › Title 11 - DEPARTMENT OF HEALTH › Subtitle 1 - GENERAL DEPARTMENTAL PROVISIONS › Chapter 280.1 - UNDERGROUND STORAGE TANKS › Subchapter 8 - FINANCIAL RESPONSIBILITY › Section 11-280.1-104 - Local government bond rating test

Current through June, 2024
(a) A general
				  purpose local government owner or operator and/or local government serving as a
				  guarantor may satisfy the requirements of section 11-280.1-93 by having a
				  currently outstanding issue or issues of general obligation bonds of $1,000/000
				  or more, excluding refunded obligations, with a Moody's rating of Aaa, Aa, A,
				  or Baa, or a Standard & Poor's rating of AAA, AA, A, or BBB. Where a local
				  government has multiple outstanding issues, or where a local government's bonds
				  are rated by both Moody's and Standard and Poor's, the lowest rating must be
				  used to determine eligibility. Bonds that are backed by credit enhancement
				  other than municipal bond insurance may not be considered in determining the
				  amount of applicable bonds outstanding.
(b) A local government owner or operator or
				  local government serving as a guarantor that is not a general-purpose local
				  government and does not have the legal authority to issue general obligation
				  bonds may satisfy the requirements of section 11-280.1-93 by having a currently
				  outstanding issue or issues of revenue bonds of $1,000,000 or more, excluding
				  refunded issues and by also having a Moody's rating of Aaa, Aa, A, or Baa, or a
				  Standard & Poor's rating of AAA, AA, A or BBB as the lowest rating for any
				  rated revenue bond issued by the local government. Where bonds are rated by
				  both Moody's and Standard & Poor's, the lower rating for each bond must be
				  used to determine eligibility. Bonds that are backed by credit enhancement may
				  not be considered in determining the amount of applicable bonds
				  outstanding.
(c) The local
				  government owner or operator and/or guarantor must maintain a copy of its bond
				  rating published within the last twelve months by Moody's or Standard &
				  Poor's.
(d) To demonstrate that it
				  meets the local government bond rating test, the chief financial officer of a
				  general purpose local government owner or operator and/or guarantor must sign a
				  letter worded exactly as follows, except that the instructions in brackets are
				  to be replaced by the relevant information and the brackets deleted:
LETTER FROM THE CHIEF FINANCIAL OFFICER
I am the chief financial officer of [insert: name and
					 address of local government owner or operator, or guarantor]. This letter is in
					 support of the use of the bond rating test to demonstrate financial
					 responsibility for [insert: "taking corrective action" and/or "compensating
					 third parties for bodily injury and property damage"] caused by [insert:
					 "sudden accidental releases" or "nonsudden accidental releases" or "accidental
					 releases"] in the amount of at least [insert: dollar amount] per occurrence and
					 [insert: dollar amount] annual aggregate arising from operating (an)
					 underground storage tank(s).
Underground storage tanks at the following facilities are
					 assured by this bond rating test: [List for each facility: the name and address
					 of the facility where tanks are assured by the bond rating test].
The details of the issue date, maturity, outstanding
					 amount, bond rating, and bond rating agency of all outstanding bond issues that
					 are being used by [name of local government owner or operator, or guarantor] to
					 demonstrate financial responsibility are as follows: [complete table]
Issue Date
Maturity Date
Outstanding Amount
Bond Rating
Rating Agency*
*[Moody's or Standard & Poor's]
The total outstanding obligation of [insert amount],
					 excluding refunded bond issues, exceeds the minimum amount of $1,000,000. All
					 outstanding general obligation bonds issued by this government that have been
					 rated by Moody's or Standard & Poor's are rated as at least investment
					 grade (Moody's Baa or Standard & Poor's BBB) based on the most recent
					 ratings published within the last twelve months. Neither rating service has
					 provided notification within the last twelve months of downgrading of bond
					 ratings below investment grade or of withdrawal of bond rating other than for
					 repayment of outstanding bond issues.
I hereby certify that the wording of this letter is
					 identical to the wording specified in section 11-280.1-104(d), Hawaii
					 Administrative Rules, as such regulations were constituted on the date shown
					 immediately below.
[Date]
[Signature]
[Name]
[Title]
(e) To demonstrate that it meets the local
				  government bond rating test, the chief financial officer of local government
				  owner or operator and/or guarantor other than a general purpose government must
				  sign a letter worded exactly as follows, except that the instructions in
				  brackets are to be replaced by the relevant information and the brackets
				  deleted:
LETTER FROM THE CHIEF FINANCIAL OFFICER
I am the chief financial officer of [insert: name and
					 address of local government owner or operator, or guarantor]. This letter is in
					 support of the use of the bond rating test to demonstrate financial
					 responsibility for [insert: "taking corrective action" and/or "compensating
					 third parties for bodily injury and property damage"] caused by [insert:
					 "sudden accidental releases" or "nonsudden accidental releases" or "accidental
					 releases"] in the amount of at least [insert: dollar amount] per occurrence and
					 [insert: dollar amount] annual aggregate arising from operating (an)
					 underground storage tank(s). This local government is not organized to provide
					 general governmental services and does not have the legal authority under state
					 law or constitutional provisions to issue general obligation debt.
Underground storage tanks at the following facilities are
					 assured by this bond rating test: [List for each facility: the name and address
					 of the facility where tanks are assured by the bond rating test.]
The details of the issue date, maturity, outstanding
					 amount, bond rating, and bond rating agency of all outstanding revenue bond
					 issues that are being used by [name of local government owner or operator, or
					 guarantor] to demonstrate financial responsibility are as follows: [complete
					 table]
Issue Date
Maturity Date
Outstanding Amount
Bond Rating
Rating Agency*
* [Moody's or Standard & Poor's]
The total outstanding obligation of [insert amount],
					 excluding refunded bond issues, exceeds the minimum amount of $1,000,000. All
					 outstanding revenue bonds issued by this government that have been rated by
					 Moody's or Standard & Poor's are rated as at least investment grade
					 (Moody's Baa or Standard & Poor's BBB) based on the most recent ratings
					 published within the last twelve months. The revenue bonds listed are not
					 backed by third-party credit enhancement or insured by a municipal bond
					 insurance company. Neither rating service has provided notification within the
					 last twelve months of downgrading of bond ratings below investment grade or of
					 withdrawal of bond rating other than for repayment of outstanding bond
					 issues.
I hereby certify that the wording of this letter is
					 identical to the wording specified in section 11-280.1-104(e), Hawaii
					 Administrative Rules,
as
such regulations were constituted on
					 the date shown immediately below.
[Date]
[Signature]
[Name]
[Title]
(f) The director may require reports of
				  financial condition at any time from the local government owner or operator
				  and/or local government guarantor. If the director finds, on the basis of such
				  reports or other information, that the local government owner or operator
				  and/or guarantor no longer meets the local government bond rating test
				  requirements of this section, the local government owner or operator must
				  obtain alternative coverage within thirty days after notification of such a
				  finding.
(g) If a local government
				  owner or operator using the bond rating test to provide financial assurance
				  finds that it no longer meets the bond rating test requirements, the local
				  government owner or operator must obtain alternative coverage within one
				  hundred fifty days of the change in status.
(h) If the local government owner or operator
				  fails to obtain alternate assurance within one hundred fifty days of finding
				  that it no longer meets the requirements of the bond rating test or within
				  thirty days of notification by the director that it no longer meets the
				  requirements of the bond rating test, the owner or operator must notify the
				  director of such failure within ten days.