Louisiana Administrative Code › Title 43 - NATURAL RESOURCES › Part XV - Office of Conservation-Surface Mining › Subpart 4 - Bond and Insurance Requirements for Surface Coal Mining and Reclamation Operations › Chapter 43 - Form, Conditions and Terms of Performance Bonds and Liability Insurance › Section XV-4303 - Terms and Conditions of the Bond

Current through Register Vol. 50, No. 6, June 20, 2024
A. The performance bond shall be in an amount
				  determined by the office as provided in §4101
B. The performance bond shall be payable to
				  the office.
C. 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 entire permit area or an identified increment of land within the permit
				  area upon which the operator will initiate and conduct surface coal mining and
				  reclamation operations during the initial term of the permit.
D. The duration of the bond shall be for the
				  time period provided in §4105
E. Surety bonds shall be subject to the
				  following conditions.
1. The office 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, nonpayment
				  of premium or bankruptcy of the permittee during the period of liability.
				  Surety bond coverage for permitted lands not disturbed may be cancelled with
				  the consent of the office; provided, the surety gives at least 60 days notice
				  to both the permittee and the office of the intent to cancel prior to
				  cancellation. Such notice shall be by certified mail and shall not be effective
				  until received by both the permittee and office. Cancellation shall not be
				  effective for lands subject to bond coverage which are disturbed after receipt
				  of notice, but prior to approval by the office. The office may approve such
				  cancellation only if a replacement bond is filed by the permittee prior to the
				  cancellation 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 costs attributable to the completion of reclamation operations on
				  the reduced permit area in accordance with Chapter 41 and the remaining
				  performance bond liability.
2. The
				  office shall not accept surety bonds in excess of 10 percent of the surety
				  company's capital surplus account as shown on the balance sheet certified by a
				  certified public accountant, unless otherwise provided by law.
3. The office 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, or, in the absence of state law, as provided in §4303.
				  E 2
4. The office may provide in
				  the bond that the amount shall be confessed to judgment upon
				  forfeiture.
5. The bond shall
				  provide that the surety and the permittee shall be liable jointly, severally
				  and in solido.
6. The bond shall
				  provide that:
a. the surety will give prompt
				  notice to the permittee and the office 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;
b. 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 office;
c. upon the incapacity of a bank or surety
				  company by reason of bankruptcy, insolvency, or suspension or revocation of a
				  charter or license, the permittee shall be deemed to be without bond coverage
				  and shall promptly notify the office. The office, upon notification received
				  through the procedures of §4303. E.6.a or from the permittee, shall, in
				  writing, notify the operator who is without bond coverage and specify a
				  reasonable period, not to exceed 90 days, to replace bond coverage. If an
				  adequate bond is not posted by the end of the period allowed, the operator
				  shall cease coal extraction and shall comply with the provisions of
				  §5429 and shall
				  immediately begin to conduct reclamation operations in accordance with the
				  reclamation plan. Mining operations shall not resume until the office has
				  determined that an acceptable bond has been posted.