Louisiana Administrative Code › Title 43 - NATURAL RESOURCES › Part XXXI - Coastal Protection and Restoration Authority › Chapter 1 - Natural Resource Damage Restoration Banking › Subchapter B - NRD Restoration Banking Framework › Section XXXI-125 - Financial Assurance Requirements

Current through Register Vol. 50, No. 6, June 20, 2024
A. General Provisions
1. Financial assurance in accordance with
				  this Section is required for NRD restoration banks under the NRD restoration
				  banking program, except that financial assurance is not required for an NRD
				  restoration bank proposed by a government agency that is exempt from the
				  requirement to provide financial assurance under federal law.
2. The sponsor shall establish and maintain
				  financial assurance in accordance with this Section.
3. The sponsor shall establish and maintain
				  financial assurance in the form and amount approved by the BRT, until the BRT
				  determines that the NRD restoration bank has satisfied all applicable
				  performance criteria and other requirements of the restoration banking
				  instrument.
4. Financial assurance
				  that meets the requirements of this Section shall be provided at least 30 days
				  prior to undertaking restoration activities approved under a restoration
				  banking instrument.
5. The amount
				  of financial assurance shall be based on an itemized estimate provided by an
				  independent contractor and shall include the following:
a. construction costs, equal to 100 percent
				  of the estimated cost of completing the creation, restoration, or
				  enhancement;
b. maintenance costs,
				  equal to 100 percent of the estimated cost of monitoring and maintaining the
				  site, to meet the performance criteria and other requirements of the
				  restoration banking instrument;
c.
				  corrective action or adaptive management costs, equal to 10 percent of the
				  estimated cost of construction, unless otherwise determined by the BRT to meet
				  the requirements of this Section;
d. an independent contractor is defined here
				  as a licensed contractor with no existing business relationship with the
				  sponsor. The contractor must be approved by the BRT.
6. The sponsor shall update the face value of
				  its financial assurance on the anniversary date of the instrument to reflect
				  adjustments for inflation. On the fifth anniversary of the financial assurance
				  instrument, the sponsor shall update the amount of financial assurance based on
				  updated itemized estimates pursuant to Paragraph 5 of this
				  Subsection.
7. The BRT shall
				  require additional financial assurance if additional construction or monitoring
				  is required to ensure success of the NRD restoration bank.
8. The portion of the financial assurance
				  required under Subparagraph 5.a of this Subsection above shall be released upon
				  the BRT determination that construction (including grading and planting) of the
				  NRD restoration bank has been successfully completed in accordance with the
				  restoration banking instrument.
9.
				  The portion of the financial assurance required under Subparagraphs 5.b and c
				  of this Subsection above shall be released when the BRT determines that the NRD
				  restoration bank has met its restoration objectives and performance criteria,
				  as applicable, or the BRT approves in writing the sponsors request to
				  permanently cease banking activities.
10. The sponsor may request, and the BRT may
				  approve, the substitution of a financial assurance instrument. The form and
				  content of any financial assurance instrument must be approved in advance by
				  the BRT before a substitution can be used to satisfy the financial assurance
				  obligations of this Section.
11.
				  Acceptable forms of financial assurance shall comprise one or more of the
				  following financial instruments:
a. a fully
				  funded trust fund in accordance with §125. B below;
b. a letter of credit in accordance with
				  Subsection C of this Section below;
c. a surety bond in accordance with
				  Subsection D of this Section below; and/or
d. other forms of financial assurance, other
				  than self-insurance or self-guarantee, as determined by the BRT to meet the
				  requirements of this Section.