Current through Register Vol. 50, No. 9, March 1, 2024
RELATES TO:
KRS
350.010,
350.020,
350.028,
350.130,
350.150,
350.151,
350.465,
350.550-350.597,
350.990, 30 C.F.R.
Parts 730-733, 735, 845, 846, 917,
30 U.S.C. 1253,
1255,
1268
NECESSITY, FUNCTION, AND CONFORMITY:
KRS 350.028(1),
(5),
350.151(1),
and
350.465(2)
authorize the cabinet to promulgate administrative regulations relating to
surface and underground coal mining operations.
KRS
350.990(11) authorizes the
cabinet to allow a permittee, person, or operator to perform in-kind
reclamation, environmental rehabilitation, or similar action to correct
environmental pollution, instead of making cash payment of a civil penalty
assessed under
KRS 350.990.
KRS
350.990(11) authorizes the
cabinet to promulgate administrative regulations as necessary to implement and
administer its provisions. This administrative regulation establishes criteria
and procedures to implement
KRS
350.990(11). This
administrative regulation differs from federal regulations as follows: There
are no corresponding federal regulations that establish specific requirements
applicable to state regulatory programs that provide for reclamation in lieu of
cash payment of civil penalties. As a condition of federal approval of
KRS
350.990(11),
30 CFR
917.16(c)(3) requires the
cabinet to obtain federal approval of administrative regulations prior to
implementation of
KRS
350.990(11). This
administrative regulation was submitted to the Office of Surface Mining
Reclamation and Enforcement for approval as required by
30 CFR
917.16(c)(3) at 64 FR 3670,
January 25, 1999.
Section 1.
Applicability and General Provisions.
(1) This
administrative regulation shall apply to a permittee, person, or operator who
has been assessed a civil penalty under
KRS 350.990 by a final
order of the secretary of the cabinet.
(2) The cabinet may, in accordance with
KRS
350.990(11) and this
administrative regulation, allow a permittee, person, or operator to perform
activities in lieu of cash payment of one (1) or more civil penalties, if the
aggregate amount of the civil penalties is $2,500 or more.
(3) Activities under this administrative
regulation shall be authorized under a binding agreement between the cabinet
and the person owing the civil penalty. The agreement shall be termed a "Civil
Penalty Reclamation Agreement."
(4)
A permittee, person, or operator conducting activities authorized under this
administrative regulation shall not be deemed an agent, contractor, or employee
of the cabinet.
(5) A permittee,
person, or operator conducting activities authorized under this administrative
regulation shall obtain and maintain the legal right to enter upon the site and
conduct the authorized activities.
(6)
(a) A
permittee, person, or operator conducting activities authorized under this
administrative regulation shall obtain and maintain liability insurance
coverage in accordance with this subsection.
(b) The permittee, person, or operator shall
submit a certificate issued by an insurance company authorized to do business
in Kentucky certifying that the permittee, person, or operator has a public
liability insurance policy in force for the authorized activities. The policy
shall provide for personal injury and property damage protection in an amount
adequate to compensate for all personal injury and property damage resulting
from the authorized activities, including damage caused by the use of
explosives and damage to water wells. Minimum insurance coverage for bodily
injury and property damage shall be $300,000 for each occurrence and $500,000
aggregate.
(c) The policy shall be
maintained in force during the term of the Civil Penalty Reclamation Agreement,
until the cabinet has determined in writing that the terms of the Civil Penalty
Reclamation Agreement have been satisfied.
(d) The policy shall include a clause
requiring that the insurer notify the cabinet if a substantive change is made
in the policy, including a termination or failure to renew.
(e) If the insurer becomes unable to fulfill
its obligations under the policy, notice shall be given immediately to the
permittee, person, or operator and the cabinet.
(f) Upon the incapacity of an insurer by
reason of bankruptcy, insolvency, or suspension or revocation of its license or
certificate of authority, the permittee, person, or operator shall be deemed to
be without insurance coverage and shall promptly notify the cabinet.
Notification shall not relieve the insurer of liability on its policy. The
cabinet shall notify the permittee, person, or operator in writing, specifying
a reasonable period to replace the coverage, not to exceed ninety (90) days. If
adequate insurance coverage is not obtained by the end of the period allowed,
the permittee, person, or operator shall cease the authorized activities and
the cabinet may terminate the Civil Penalty Reclamation Agreement and require
the permittee, person, or operator to pay the assessed civil penalty.
(7) If the activities authorized
under this administrative regulation are for reclamation of a mine site, the
permittee, person, or operator shall provide a performance bond. For activities
other than reclamation of a mine site, the cabinet may require the permittee,
person, or operator to provide a performance bond if the cabinet determines
that the authorized activities could create a risk of environmental harm. This
bond shall be in addition to a bond required by another federal, state, or
local law. The cabinet shall determine the amount of the bond based upon site
specific conditions. This subsection may be satisfied by a performance bond
that meets the requirements of 405 KAR Chapter 10. The cabinet shall release
the performance bond promptly after the cabinet has determined that the terms
of the Civil Penalty Reclamation Agreement have been fulfilled, and the bond
release procedures of
405
KAR 10:040 shall not apply.
(8) A permittee, person, or operator
conducting activities authorized under this administrative regulation shall
comply with applicable federal, state, and local laws and
regulations.
(9) A permittee,
person, or operator conducting activities authorized under this administrative
regulation shall not engage in coal removal in connection with the authorized
activities.
(10) Activities
authorized under this administrative regulation shall be on-ground activities
that directly result in reclamation, environmental rehabilitation, or
correction of environmental pollution. Educational, promotional, training, and
other activities that may indirectly affect the environment, shall not be
authorized.
(11) Activities
authorized under this administrative regulation shall not constitute government
financed construction for the purposes of
405 KAR 7:030,
Sections 2 and 3.
(12) The cabinet
shall determine the location, scope, and time schedule for activities
authorized under this administrative regulation.
(13) The Division of Abandoned Mine Lands
shall determine the estimate of the cost of activities authorized or completed
under this administrative regulation.
(14) Activities shall not be authorized under
this administrative regulation unless their estimated cost exceeds the assessed
amount of the civil penalty.
(15)
The cost of activities in excess of the civil penalty amount covered in the
Civil Penalty Reclamation Agreement shall not be credited or carried forward to
satisfy a civil penalty not covered in the Civil Penalty Reclamation Agreement
or a future civil penalty.
(16) The
cabinet shall maintain appropriate records of activities conducted under this
administrative regulation. The Department for Natural Resources shall maintain
custody of the records. The cabinet shall request an audit of these records and
activities authorized under this administrative regulation, at intervals of not
more than five (5) years.
Section
2. Ineligible Permittees, Persons, or Operators. The cabinet shall
not authorize a permittee, person, or operator to perform activities under this
administrative regulation if the permittee, person, or operator is ineligible
to receive a permit under KRS Chapter 350 and 405 KAR Chapters 7-24 for a
reason other than nonpayment of a civil penalty.
Section 3. Ineligible Civil Penalties. The
cabinet shall not authorize activities in lieu of cash payment of a civil
penalty if:
(1) A violation that led to the
civil penalty remains unabated; or
(2) The permittee, person, or operator owing
the civil penalty has:
(a) Entered into an
agreed order with the cabinet to pay the civil penalty; and
(b) Failed to comply with the terms of the
agreed order.
Section
4. Ineligible Sites. The cabinet shall not authorize activities at
the following sites:
(1) A site that is under
a valid permit under KRS Chapter 350 for which the bond has not been
forfeited;
(2) A site that is under
another valid federal, state, or local permit, under which the permit holder
has responsibility for environmental conditions at the site; or
(3) A site for which there is an ongoing
enforcement action for violation of federal, state, or local environmental
laws, unless the agency pursuing the enforcement action consents.
Section 5. Selection of Sites.
(1) For informational and planning purposes,
the cabinet may develop and maintain a list of sites that may be suitable for
activities under this administrative regulation, and may assign priorities to
sites on the list. If the cabinet develops a list of sites, it shall be made
available to the public. Authorization of a site for activities under this
administrative regulation shall be made on a case-by-case basis and shall not
be limited to sites on the list.
(2) The cabinet may consider sites and
activities proposed by the permittee, person, or operator owing a civil
penalty, but the cabinet shall not have an obligation to authorize, or give
preference to, the sites or activities.
(3) The cabinet shall consult with the county
fiscal court before authorizing activities on a site in the county. The county
fiscal court may recommend sites or activities, but the cabinet shall not have
an obligation to authorize, or give preference to, the sites or
activities.
(4) The cabinet may
consult with other federal, state, and local government agencies and officials,
and with private organizations and individuals, regarding selection of sites
and activities to be authorized.
(5) The cabinet may seek public input
regarding selection of sites and activities to be authorized, through newspaper
notice or by other means.
(6) The
cabinet may give preference to sites or activities that address environmental
impacts resulting from coal mining.
Section 6. Criteria Applicable to Activities
and Costs.
(1) The following activities shall
not be authorized under this administrative regulation:
(a) Activities which the permittee, person,
or operator owing the civil penalty has a duty to perform under KRS Chapter 350
or other federal, state, or local law;
(b) Activities which the permittee, person,
or operator owing the civil penalty, or other person, has a legal obligation to
perform under a valid contract; and
(c) Activities on land or waters in which the
permittee, person, or operator owing the penalty has, directly or indirectly,
an ownership interest or other financial interest.
(2) The following activities and costs shall
not be credited toward the civil penalty:
(a)
Activities begun or costs incurred prior to the Civil Penalty Reclamation
Agreement;
(b) The cost of labor,
equipment, time, materials, or services, donated by persons other than the
permittee, person, or operator owing the civil penalty;
(c) Payments or gifts by the permittee,
person, or operator owing the civil penalty to government agencies or private
organizations in exchange for their participation in planning or carrying out
activities;
(d) Purchase or lease
of land, easements, rights of way, or other access to property;
(e) Construction, modification or repair of a
building or other structure, unless the function of the building or other
structure is prevention, control, or abatement of environmental
pollution;
(f) Repair of a road,
unless the purpose of the repair is abatement and control of environmental
pollution;
(g) Transportation
costs; and
(h) Administrative costs
and overhead.
(3)
Activities may be authorized in conjunction with an abandoned mine land
reclamation project of the cabinet under
KRS
350.550 through
350.597.
(4) Activities may be authorized in
conjunction with reclamation of a bond forfeiture site by the cabinet under
KRS
350.150, if the permittee, person, or
operator owing the civil penalty:
(a) Did not
own or control the site under KRS Chapter 350;
(b) Was not an operator or agent on the site
under KRS Chapter 350; and
(c) Has
no direct or indirect ownership or other interest in the land.
Section 7. Request.
(1) A permittee, person, or operator desiring
to perform in-kind reclamation, environmental rehabilitation, or similar action
to correct environmental pollution in lieu of cash payment of a civil penalty
shall make a written request to the Commissioner of the Department for Natural
Resources. The request shall not be made contingent upon any particular
proposed site or activities.
(2)
The request shall identify:
(a) The permittee
and permit number associated with the civil penalty;
(b) The identifying number of the
noncompliance or cessation order that resulted in the civil penalty;
(c) The assessed civil penalty amount and the
amount that remains unpaid;
(d) The
name, mailing address, and telephone number of the permittee, operator or
person making the request; and
(e)
The date of the request.
(3) If the civil penalty is owed by an
individual, the request shall bear the signature of the individual.
(4) If the civil penalty is owed by a
business entity, the request shall bear the signature and title of an
authorized officer or agent of the business entity.
(5)
(a) For
a civil penalty assessed by final order of the secretary on or after July 1,
1999, the request shall be filed within thirty (30) days after the date of the
final order.
(b) For a civil
penalty assessed by final order of the secretary prior to July 1, 1999, the
request shall be filed not later than June 30, 2000.
(c) The filing of the request shall not stay
the collection of the civil penalty.
(6) Within fifteen (15) days after receiving
a request under this section, the cabinet shall notify the permittee, person,
or operator, in writing, of whether the cabinet intends to pursue a Civil
Penalty Reclamation Agreement with the permittee, person, or operator. The
cabinet may require additional information relevant to the request.
(7) The permittee, person, or operator may
withdraw the request at any time prior to entering into a Civil Penalty
Reclamation Agreement, by providing written notice to the Commissioner of the
Department for Natural Resources.
Section 8. Civil Penalty Reclamation
Agreement.
(1) The Civil Penalty Reclamation
Agreement shall specify:
(a) The effective
date of the Civil Penalty Reclamation Agreement;
(b) The names of the parties to the Civil
Penalty Reclamation Agreement;
(c)
The civil penalty amount;
(d) The
identifying number of the noncompliance or cessation order that resulted in the
civil penalty;
(e) The permit
number and name of the permittee associated with the violation that led to the
civil penalty;
(f) The activities
authorized;
(g) The time span
within which the authorized activities shall be completed;
(h) The site of the authorized
activities;
(i) The requirements for
legal right of entry, liability insurance, and performance bonding;
(j) The conditions under which the Civil
Penalty Reclamation Agreement may be modified or terminated;
(k) The consequences of failure to satisfy
the terms of the Civil Penalty Reclamation Agreement; and
(l) The effect of successful satisfaction of
the terms of the Civil Penalty Reclamation Agreement.
(2) A Civil Penalty Reclamation Agreement may
cover multiple civil penalties and sites:
(a)
Multiple civil penalties may be covered at a single site; and
(b) A single civil penalty may be covered at
multiple sites.
(3) The
cabinet and the permittee, person, or operator owing the civil penalty shall be
parties to the Civil Penalty Reclamation Agreement. Other parties may be
included if the cabinet determines they are necessary parties to the Civil
Penalty Reclamation Agreement.
(4)
Except as provided in subsection (5) of this section, the Civil Penalty
Reclamation Agreement may be modified or terminated at any time if approved in
writing by all parties in accordance with the provisions established in the
Civil Penalty Reclamation Agreement as required by subsection (1)(j) of this
section.
(5) The cabinet may
terminate the Civil Penalty Reclamation Agreement at any time if the permittee,
person, or operator owing the civil penalty fails to satisfactorily fulfill the
terms of the Civil Penalty Reclamation Agreement.
(6) The cabinet shall conduct field
inspections as necessary to monitor progress under the Civil Penalty
Reclamation Agreement.
(7) The
civil penalty shall remain due and payable until the cabinet has determined in
writing that the permittee, person, or operator owing the civil penalty has
satisfactorily fulfilled the terms of the Civil Penalty Reclamation
Agreement.
(8) The full assessed
civil penalty shall be due and payable if the Civil Penalty Reclamation
Agreement is breached.
STATUTORY AUTHORITY:
KRS
350.020,
350.028,
350.151,
350.465,
350.990, 30 C.F.R.
Parts 730-733, 735, 845, 846, 917,
30 U.S.C. 1253,
1255,
1268