Idaho Administrative Code
Title IDAPA 58 - Environmental Quality, Department of
Rule 58.01.09 - RULES REGULATING SWINE FACILITIES
Section 58.01.09.205 - FINANCIAL ASSURANCE REQUIREMENTS
Universal Citation: ID Admin Code 58.01.09.205
Current through August 31, 2023
Financial assurance mechanisms identified and submitted must meet the following general and specific conditions. (3-24-22)
01. Written Estimate of Costs. (3-24-22)
a. Detail the cost of hiring a third
party to remediate potential contamination caused by the operation of the
facility or of any potential spill or breech, including, without limitation,
remediation pursuant to the facility's spill contingency plan, and closing the
facility in accordance with an approved closure plan. (3-24-22)
b. Revisions to remediation and closure cost
estimates and the amount of financial assurance are to be submitted to the
Department if changes to the closure plan, facility conditions or operations,
or inflation changes the cost estimates at any time during the active life of
the facility. (3-24-22)
02. General Conditions.
a. Proof of financial capability, acceptable
to the Department, describes the ability of the applicant to perform remedial
actions and meet the conditions of an approved closure plan for a facility. The
mechanism(s) used to demonstrate financial capability must be legally valid,
binding and enforceable under applicable law, and ensure that the funds
necessary to meet the costs of remediation and closure will be available to the
party conducting closure and remediation whenever the funds are needed. The
mechanisms include but are not limited to any one or more of the following:
surety bonds, trust funds, irrevocable letters of credit, insurance, and
corporate guarantees. (3-24-22)
b.
Continuous coverage for remediation and closure is identified and sustained
until the applicant is released by the Department from financial assurance
obligations. (3-24-22)
c. Prior to
cancellation of a financial assurance mechanism, the applicant obtains a new
financial assurance plan acceptable to the Department, or ceases operations and
closes out the facility before the date of cancellation. (3-24-22)
d. Financial assurance, less identified
retainages, is released when the Department determines that initial closure
activities have been completed. A sufficient amount of financial assurance is
retained by the Department, up to five (5) years after closure, to ensure
proper remediation and closure of a facility. (3-24-22)
e. Nothing in these rules, including the
release or use of all financial assurance, relieves the applicant of liability
and responsibility for remediation and closure costs and activities. The use of
all financial assurance does not relieve the applicant from responsibility and
liability for remediation and closure costs. (3-24-22)
03. Surety Bond. A certified copy of the bond from the surety company issuing the bond which at a minimum is among those listed as acceptable sureties on federal bonds in Circular 570 of the U.S. Department of the Treasury. (3-24-22)
a. The penal sum of the bond will be in an
amount at least equal to the most recent estimate of remediation and closure
costs. (3-24-22)
b. The surety will
become liable on the bond obligation when the applicant fails to perform as
guaranteed by the bond or the Department notifies the applicant that he has
failed to meet the provisions of these rules. (3-24-22)
04. Letters of Credit. (3-24-22)
a. A certified copy of a standby letter of
credit showing the letter is irrevocable, issued in an amount at least equal to
the current remediation and closure cost estimates, and for a period of at
least one year. The expiration date will automatically extend for a period of
at least one (1) year. The issuing institution must be an entity with authority
to issue letters of credit and whose letter-of-credit operations are regulated
and examined by a federal or state agency. (3-24-22)
b. Include a letter from the applicant
referring to the letter of credit by number, issuing institution, and date, and
providing the type of facility, name and address of the facility, and the
amount of funds assured for remediation and closure of the facility by the
letter of credit. (3-24-22)
05. Trust Fund. A certified copy of a trust agreement where the trustee is an entity with the authority to act on behalf of the applicant and whose trust operations are regulated and examined by a federal or state agency. (3-24-22)
06. Insurance. A copy of the policy of remediation and closure insurance from an insurer licensed to transact the business of insurance, or eligible to provide insurance as an excess or surplus lines insurer, in one (1) or more states. (3-24-22)
a. The insurance policy will: (3-24-22)
i. Be in an amount at least equal to the
current remediation and closure cost estimates. The term "face amount" means
the total amount the insurer is obligated to pay under the policy. Actual
payments by the insurer will not change the face amount, although the insurer's
future liability will be lowered by the amount of the payments; and
(3-24-22)
ii. Contain a provision:
(3-24-22)
(1) Allowing assignment of the
policy to a successor. Such assignment may be conditional upon consent of the
insurer, provided such consent is not unreasonably refused; (3-24-22)
(2) Providing the applicant or successor with
the option of renewal at the face amount of the expiring policy; and
(3-24-22)
(3) Providing that the
insurer cannot cancel, terminate, or fail to renew the policy except for
failure to pay the premium. (3-24-22)
07. Corporate Guarantee.
a. A certified copy of the guarantee and
appropriate letter from a guarantor who is the direct or higher-tier parent
corporation of the applicant, a firm whose parent corporation is also the
parent corporation of the applicant, or a firm with a "substantial business
relationship" with the applicant. (3-24-22)
b. A letter from the guarantor's chief
financial officer describing the value received in consideration of the
guarantee if the guarantor's parent company is also the parent corporation of
the applicant. If the guarantor is a firm with a "substantial business
relationship" with the applicant, provide a letter describing the "substantial
business relationship" and the value received in consideration of the
guarantee. (3-24-22)
c. Ensure the
terms provide that the guarantor will perform, or pay a third party to perform,
remediation and closure (performance guarantee) if the applicant fails to
perform remediation or closure of a facility covered by the guarantee, or
establish a fully funded trust fund as specified in Subsection
205.05 in the name of the
applicant (payment guarantee). (3-24-22)
Disclaimer: These regulations may not be the most recent version. Idaho may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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