Current through Register Vol. 48, No. 38, September 20, 2024
a) Definitions: The following terms are used
in this Section. The definitions are intended to assist in the understanding of
this Section and are not intended to limit the meanings of terms in a way that
conflicts with generally accepted accounting principles.
"Assets" means all existing and all probable future economic
benefits obtained or controlled by a particular entity.
"Current assets" means cash or other assets or resources
commonly identified as those which are reasonably expected to be realized in
cash or sold or consumed during the normal operating cycle of the
business.
"Current liabilities" means obligations whose liquidation is
reasonably expected to require the use of existing resources properly
classifiable as current assets or the creation of other current
liabilities.
"Generally accepted accounting principles" means the
accounting and auditing standards incorporated by reference at 35 Ill. Adm.
Code
810.104(a)(2).
"Gross Revenue" means total receipts less returns and
allowances.
"Independently audited" refers to an audit performed by an
independent certified public accountant in accordance with generally accepted
auditing standards.
"Liabilities" means probable future sacrifices of economic
benefits arising from present obligations to transfer assets or provide
services to other entities in the future as a result of past transactions or
events.
"Net working capital" means current assets minus current
liabilities.
"Net worth" means total assets minus total liabilities and is
equivalent to owner's equity.
"Tangible net worth" means the tangible assets less
liabilities; tangible assets do not include intangibles such as goodwill and
rights to patents or royalties.
b) An operator may satisfy the financial
assurance requirements of this Part by providing the following:
1) Bond without surety promising to pay the
cost estimate (subsection (c)).
2)
Proof that the operator meets the gross revenue test (subsection
(d)).
3) Proof that the operator
meets the financial test (subsection (e)).
c) Bond without surety. An operator utilizing
self-insurance must provide a bond without surety on the form provided in
Appendix A, Illustration G. The operator must promise to pay the current cost
estimate to the Agency unless the operator provides closure and post-closure
care in accordance with the closure and post-closure care plans.
d) Gross revenue test. The operator must
demonstrate that less than one-half of its gross revenues are derived from
waste disposal operations.
e)
Financial test:
1) To pass the financial
test, the operator must meet the criteria of either subsection (e)(1)(A) or
(e)(1)(B):
A) The operator must have:
i) Two of the following three ratios: a ratio
of total liabilities to net worth less than 2.0; a ratio of the sum of net
income plus depreciation, depletion and amortization to total liabilities
greater than 0.1; or a ratio of current assets to current liabilities greater
than 1.5; and
ii) Net working
capital and tangible net worth each at least six times the current cost
estimate; and
iii) Tangible net
worth of at least $10 million; and
iv) Assets in the United States amounting to
at least 90 percent of the operator's total assets and at least six times the
current cost estimate.
B) The operator must have:
i) A current rating for its most recent bond
issuance of AAA, AA, A or BBB as issued by Standard and Poor's or Aaa, Aa, A or
Baa as issued by Moody's; and
ii)
Tangible net worth at least six times the current cost estimate; and
iii) Tangible net worth of at least $10
million; and
iv) Assets located in
the United States amounting to at least 90 percent of its total assets or at
least six times the current cost estimate.
2) To demonstrate that it meets this test,
the operator must submit the following items to the Agency:
A) A letter signed by the operator's chief
financial officer and worded as specified in Appendix A, Illustration I;
and
B) A copy of the independent
certified public accountant's report on examination of the operator's financial
statements for the latest completed fiscal year; and
C) A special report from the operator's
independent certified public accountant to the operator stating that:
i) The accountant has compared the data which
the letter from the chief financial officer specifies as having been derived
from the independently audited, year-end financial statements for the latest
fiscal year with the amounts in such financial statements; and
ii) In connection with that procedure, no
matters came to the accountant's attention that caused the accountant to
believe that the specified data should be adjusted.
f) Updated information:
1) After the initial submission of items
specified in subsections (d) and (e), the operator must send updated
information to the Agency within 90 days after the close of each succeeding
fiscal year.
2) If the operator no
longer meets the requirements of subsections (d) and (e), the operator must
send notice to the Agency of intent to establish alternate financial assurance.
The notice must be sent by certified mail within 90 days after the end of the
fiscal year for which the year-end financial data show that the operator no
longer meets the requirements.
g) Qualified opinions. If the opinion
required in subsections (e)(2)(B) and (e)(2)(C) includes an adverse opinion or
a disclaimer of opinion, the Agency shall disallow the use of self-insurance.
If the opinion includes other qualifications, the Agency shall disallow the use
of self-insurance if:
1) The qualifications
relate to the numbers that are used in the gross revenue test or the financial
test; and
2) In light of the
qualifications, the operator has failed to demonstrate that it meets the gross
revenue test or financial test.
h) Parent corporation. An operator may
satisfy the financial assurance requirements of this Part by:
1) Demonstrating that a corporation that owns
an interest in the operator meets the requirements of this Section;
and
2) Providing a bond to the
Agency with the parent corporation as surety on a form specified in Appendix A,
Illustration H in accordance with Section
807.662(d), (e),
(f), and (g) of this Part.
