California Code of Regulations
Title 14 - Natural Resources
Division 7 - Department of Resources Recycling and Recovery
Chapter 6 - Permitting of Waste Tire Facilities and Waste Tire Hauler Registration and Tire Manifests
Article 10 - Financial Responsibility for Operating Liability Claims of Major Waste Tire Facilities
Section 18493 - Financial Means Test

Universal Citation: 14 CA Code of Regs 18493

Current through Register 2024 Notice Reg. No. 38, September 20, 2024

(a) To pass the financial means test, an operator or a guarantor shall be a private entity and shall meet the criteria of section (c) or (d) based on independently audited year-end financial statements for the latest completed fiscal year.

(b) The phrase "amount of liability coverage to be demonstrated by the test" as used in sections (c) and (d) refers to the amount of liability coverage required by section 18487 of this Article.

(1) Net working capital and tangible net worth each at least six times the amount of liability coverage to be demonstrated by the test; and

(2) Tangible net worth of at least $10 million; and

(3) Assets located in the United States amounting to at least 90 percent of its total assets or at least six times the amount of liability coverage to be demonstrated by the test.

(d) The operator or guarantor shall have:

(1) A current rating for its most recent bond issuance of AAA, AA, A, or BBB issued by Standard and Poor's or Aaa, Aa, A, or Baa as issued by Moody's; and

(2) Tangible net worth of at least six times the amount of liability coverage to be demonstrated by the test; and

(3) Tangible net worth of at least $10 million; and

(4) Assets located in the United States amounting to at least 90 percent of its total assets or at least six times the amount of liability coverage to be demonstrated by the test.

(e) Within 90 days after the close of each financial reporting year, the operator or the guarantor shall submit the following items to the Board or its designee and, in the case of a guarantor, to the operator;

(1) A letter on the operator's or guarantor's official letterhead stationary that is worded and completed as specified in form CalRecycle 149 "Instructions for the Letter from the Chief Financial Officer Financial Means Test for Liability" (03/17), which is incorporated herein by reference and which contains an original signature of the operator's or guarantor's chief financial officer. (See Appendix A.) An operator or guarantor shall use form CalRecycle 149 (03/17) to demonstrate or guarantee financial responsibility for liability coverage only. If the operator or guarantor is using a similar financial means test to demonstrate liability coverage for facilities in California or other states, such as but not limited to, hazardous waste treatment, storage, or disposal facilities, or solid waste landfills, or other waste tire facilities, the operator shall list all facilities covered by the financial means test, whether in California or not.

(2) A copy of an independent certified public accountant's report on examination of the operator's or guarantor's financial statements for the latest completed fiscal year, with a copy of the operator's or guarantor's financial statements for the latest completed fiscal year.

(3) A letter from an independent certified public accountant stating that:

(A) He or she has compared the data in the letter in section (e)(1), from the chief financial officer specified as having been derived from the financial statements for the latest completed fiscal year of the operator or the guarantor, with the amounts in the financial statements; and

(B) Based on the comparison, no matters came to his or her attention that caused him or her to believe that the specified data should be adjusted.

(4) If the operator or the guarantor is required to make such a filing, a copy of the operator's or guarantor's most recent form 10-K filed with the U.S. Securities and Exchange Commission.

(f) The Board or its designee may require updated financial statements at any time from the operator or guarantor. If the Board or its designee finds that the operator no longer meets the financial means test requirements of sections (c) or (d) based on such reports or other information, including but not limited to, credit reports and reports from other state agencies, the operator shall obtain alternate coverage within 60 days after receiving the notification of such a finding.

(g) If an operator using the financial means test fails to meet the requirements of the financial means test under sections (c) or (d), the operator shall obtain alternate coverage within 60 days after the determination of such failure.

(h) If the operator fails to obtain alternate coverage within the times specified in sections (f) or (g), the operator shall notify the Board or its designee by certified mail within 10 days of such failure.

1. New section filed 2-10-92 as an emergency; operative 2-10-92 (Register 92, No. 21). A Certificate of Compliance must be transmitted to OAL 6-9-92 or emergency language will be repealed by operation of law on the following day.
2. New section refiled 5-29-92 as an emergency; operative 6-8-92 (Register 92, No. 25). A Certificate of Compliance must be transmitted to OAL by 10-6-92 or emergency language will be repealed by operation of law on the following day.
3. New section refiled 9-28-92 as an emergency; operative 10-6-92 (Register 92, No. 40). A Certificate of Compliance must be transmitted to OAL by 2-3-92 or emergency language will be repealed by operation of law on the following day.
4. New section refiled 1-25-93 as an emergency; operative 2-2-93 (Register 93, No. 5). A Certificate of Compliance must be transmitted to OAL 6-2-93 or emergency language will be repealed by operation of law on the following day.
5. Certificate of Compliance as to 1-25-93 order transmitted to OAL 5-26-93; disapproved by OAL on 6-22-93 (Register 93, No. 26).
6. New section filed 6-22-93 as an emergency; operative 6-22-93 (Register 93, No. 26). A Certificate of Compliance must be transmitted to OAL 10-20-93 or emergency language will be repealed by operation of law on the following day.
7. Editorial correction of HISTORY 4 (Register 93, No. 26).
8. Certificate of Compliance as to 6-22-93 emergency order including amendment of subsections (a) and (b) transmitted to OAL 9-23-93 and filed 11-3-93 (Register 93, No. 45).
9. Change without regulatory effect amending subsection (e)(1) filed 4-2-96 pursuant to section 100, title 1, California Code of Regulations (Register 96, No. 14).
10. Change without regulatory effect amending subsection (e)(1) and amending form CalRecycle (formerly CIWMB) 149 (incorporated by reference) filed 12-11-2017 pursuant to section 100, title 1, California Code of Regulations (Register 2017, No. 50)9

Note: Authority cited: Sections 40502 and 42820, Public Resources Code. Reference: Section 42821, Public Resources Code.

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