Current through Register Vol. 50, No. 9, March 1, 2024
RELATES TO: KRS 224.01, 224.10, 224.40, 224.46, 224.50, 224.99,
Chapter 355
NECESSITY, FUNCTION, AND CONFORMITY: KRS Chapter 224 requires
the cabinet to adopt administrative regulations for the managing, processing,
or disposal of wastes.
KRS
224.40-305 requires persons who establish,
construct, operate, maintain or permit the use of a waste site or facility to
obtain a permit. This chapter establishes the permitting standards for special
waste sites or facilities, and the standards applicable to all special waste
sites or facilities. This administrative regulation sets forth the financial
requirements for closure and postclosure of special waste sites or
facilities.
Section 1. Applicability.
The financial assurance criteria and bond requirements apply to the owner or
operator of special waste landfills, Type A landfarming and composting sites or
facilities, and research, development and demonstration sites or facilities,
and other sites or facilities if required by the cabinet.
Section 2. Closure Cost Estimate. The owner
or operator shall have a detailed, current written estimate, in dollars, of the
cost of hiring a third party to close the special waste disposal site or
facility in accordance with the closure plan developed to satisfy the closure
requirements in Section 4 of
401 KAR
45:100 and Section 5 of
401
KAR 45:110.
(1) The
estimate shall equal the cost of closing the special waste disposal site or
facility at the point in the active life when the extent and manner of its
operation would make closure the most expensive. The cabinet may adjust the
figure for inflation and other factors. The owner or operator shall base the
cost estimate on the following elements:
(a)
Design;
(b) Site grading and
drainage;
(c) Hauling and placing
of each element of the approved cap;
(d) Final grading and drainage of the
cap;
(e) Revegetation of the cap;
and
(f) Quality control and
construction certification.
(2) The owner or operator shall increase the
closure cost estimate and the amount of financial assurance provided under
Section 5 of this administrative regulation if changes to the closure plan or
special waste disposal site or facility conditions increase the maximum cost of
closure at any time during the active life.
(3) The owner or operator may request a
reduction in the closure cost estimate and the amount of financial assurance
provided under Section 5 of this administrative regulation if he can
demonstrate that the cost estimate exceeds the maximum cost of closure at any
time over the life of the special waste disposal site or facility.
(4) The owner or operator shall keep a copy
of the latest closure cost estimate at the special waste disposal site or
facility until the owner or operator has been notified by the cabinet that he
has been released from closure financial assurance requirements under Section 5
of this administrative regulation.
Section 3. Postclosure Cost Estimate.
(1) The owner or operator shall have a
current, detailed written estimate, in dollars, of the cost of hiring a third
party to conduct each phase of postclosure monitoring and maintenance of the
special waste site or facility in accordance with the postclosure plan
developed to satisfy the postclosure requirements of Section 4 of
401 KAR
45:100 and Section 5 of
401
KAR 45:110. The postclosure cost estimate for each
phase of postclosure used to demonstrate financial assurance in Section 6 of
this administrative regulation shall be calculated by multiplying the annual
cost estimate for each phase of postclosure by the number of years of
postclosure care required.
(2) The
cost estimate for each phase of postclosure shall be based on the most
expensive costs of postclosure during that phase.
(3) The owner or operator shall increase the
amount of the postclosure cost estimate and the amount of financial assurance
provided under Section 6 of this administrative regulation if changes in the
postclosure plan or facility conditions increase the maximum costs of
postclosure.
(4) The owner or
operator may request a reduction in the postclosure cost estimate and the
amount of financial assurance provided under Section 6 of this administrative
regulation if he can demonstrate to the satisfaction of the cabinet that the
cost estimate exceeds the maximum costs of postclosure remaining over the
postclosure period.
(5) The owner
or operator shall keep a copy of the latest postclosure cost estimate at the
site or facility until he has been notified by the cabinet that he has been
released from postclosure financial assurance requirements for the entire
facility under Section 6 of this administrative regulation.
Section 4. Financial Mechanisms.
The owner or operator shall use one (1) of the financial mechanisms specified
in Section 7 or 10 of this administrative regulation, which satisfies the
following criteria:
(1) The financial
assurance mechanism shall ensure that the amount of funds is sufficient to
cover the costs of closure and postclosure care;
(2) The financial assurance mechanisms shall
ensure that funds shall be available in a timely fashion; and
(3) The financial assurance mechanisms shall
guarantee the availability of the required amount of coverage prior to the
initial receipt of special waste.
Section 5. Closure Financial Assurance. The
owner or operator of a special waste site or facility subject to this
administrative regulation shall establish, in accordance with Section 4 of this
administrative regulation, financial assurance for closure of the facility, in
an amount equal to the most recent closure cost estimate prepared in accordance
with Section 2 of this administrative regulation. The owner or operator shall
provide continuous coverage for closure until released from financial assurance
requirements pursuant to Section 4 of
401 KAR
45:100 or Section 5 of
401
KAR 45:110.
Section
6. Postclosure Financial Assurance. The owner or operator of a
special waste site or facility subject to the administrative regulation shall
establish, in accordance with Section 4 of this administrative regulation,
financial assurance for postclosure care of the facility, in an amount equal to
the most recent postclosure cost estimate prepared in accordance with Section 3
of this administrative regulation. The owner or operator shall provide
continuous coverage for postclosure until released from the financial assurance
requirement pursuant to Section 4 of
401 KAR
45:100 or Section 5 of
401
KAR 45:110.
Section
7. Performance Bond.
(1) Before
the cabinet shall issue a construction/operation permit, the owner or operator
of a special waste site or facility that is required to post financial
assurance pursuant to this administrative regulation shall complete a
performance bond on Form DEP 7094E entitled "Performance Bond" (November 2016).
The requirements contained in the performance bond are incorporated in this
administrative regulation by reference. The performance bond may be obtained
from the Division of Waste Management, 300 Sower Boulevard, Frankfort, Kentucky
40601, (502) 564-6716, between the hours of 8 a.m. to 4:30 p.m., Eastern Time,
Monday through Friday, or from the Web site at
eec.ky.gov/environmental-protection/waste;
(2) To satisfy the financial requirement, the
owner or operator shall submit a performance bond and one (1) of the following:
(a) A surety bond which is executed by
filling in the required information on the performance bond submitted in
accordance with subsection (1) of this section and by submitting a copy of the
surety bond agreement to the cabinet;
(b) A letter of credit as set forth on Form
DEP 7094F entitled "Irrevocable Letter of Credit" (November 2016). The
requirements contained in the irrevocable letter of credit are incorporated in
this administrative regulation by reference. The irrevocable letter of credit
may be obtained from the Division of Waste Management, 300 Sower Boulevard,
Frankfort, Kentucky, 40601, (502) 564-6716, between the hours of 8 a.m. to 4:30
p.m., Eastern Time, Monday through Friday, or from the Web site at
eec.ky.gov/environmental-protection/waste;
(c) An escrow agreement as set forth on Form
DEP 7094G entitled "Escrow Agreement" (November 2016). The requirements
contained in the escrow agreement are incorporated in this administrative
regulation by reference. The escrow agreement may be obtained from the Division
of Waste Management, 300 Sower Boulevard, Frankfort, Kentucky 40601, (502) 564-
6716, between the hours of 8 a.m. to 4:30 p.m., Eastern Time, Monday through
Friday, or from the Web site at
eec.ky.gov/environmental-protection/waste;
(3) Other financial assurance as specified in
Section 10 of this administrative regulation.
Section 8. Release of Financial Assurance.
(1) Financial assurance posted to assure
proper closure of a special waste landfarming or composting facility shall be
released in accordance with Section 4 of
401 KAR
45:100.
(2) Financial assurance posted to assure
proper closure of a special waste landfill shall be released in accordance with
Section 5 of
401
KAR 45:110.
Section 9. Financial Assurance for Publicly
Owned Facilities. The owner or operator of a publicly owned facility shall
provide a budget for the permitting, construction, operation, closure, and
post-closure care of the facility. The budget shall be revised and submitted
annually. When elements of the facility's permitting, construction, operation,
closure, or postclosure care are to be accomplished by contract or agreement, a
copy of the contract or agreement shall be submitted to the cabinet.
Section 10. Financial Assurance for Captive
Facilities. The cabinet may accept other satisfactory financial assurance as
adequate financial responsibility for a special waste site or facility which is
exclusively owned and operated by a special waste generator on property owned
by the special waste generator for the purpose of accepting special waste
exclusively from the special waste generator.
STATUTORY AUTHORITY:
KRS
224.10-100,
224.40-305,
224.50-760