A.
Financial Assurance for Closure and Post-Closure Care
(1)
Applicability . An owner or
operator of a solid waste disposal facility shall provide financial assurance
sufficient to ensure that funds are available to pay for the anticipated costs
of compliance with all facility closure, post-closure maintenance, and
post-closure monitoring requirements. State or federally owned solid waste
disposal facilities, and landfills regulated under the provisions of 06-096 CMR
401, section 7, are not subject to the requirements of this section. Financial
assurance must be provided in accordance with the requirements of this section.
This section does not apply to a municipally owned or
operated solid waste disposal facility that accepts exclusively special waste,
construction and demolition debris, land clearing debris or any combination of
those types of waste.
(2)
Time-line for Meeting Financial Assurance Requirements . Adequate
financial assurance as approved by the Department must be provided by the solid
waste disposal facility owner or operator according to the following schedules:
(a) For new facilities, prior to the receipt
of solid wastes;
(b) For transfer
of ownership, the financial assurance of the original owner or operator must
remain in place until the transfer of ownership takes place. A new owner must
provide financial assurance that is received and approved by the Department in
compliance with these rules before the transfer of ownership;
(c) For all solid waste disposal facilities
not excluded in paragraph A(1) above and not currently providing financial
assurance under the solid waste management rules or under conditions of the
facility's license, within 120 days of the effective date of this rule.
(3)
Cost
Computation
(a) Based on Third Party
Work. The amount of financial assurance required of a solid waste disposal
facility owner or operator must be approved by the Department. The amount may
be adjusted from time to time as required by subparagraph A(4)(c). The amount
of the financial assurance must be at least equal to the estimated cost of a
third party:
(i) Closing the incinerator or
landfill in accordance with the closure criteria of these rules;
(ii) Conducting post-closure care and
maintenance of the facility, including environmental monitoring and reporting
as required by law;
(iii)
Collecting and treating all leachate or other contaminants generated by the
facility during the post-closure period; and
(iv) Collecting, controlling, and treating
landfill gases during the post-closure period.
(b)
Thirty Year Post-Closure
Period . The cost estimates must be based on projections for the entire
expected time that the facility is expected to be generating leachate, methane
or other gases, contaminants or otherwise potentially creating an adverse
environmental impact, but in no case less than 30 years after a landfill
facility closes. The financial assurance cost estimates must be made in
accordance with established estimating practices and may not incorporate any
salvage or other value that may be realized by the sale of materials, wastes,
facility structures or equipment, land, or other assets associated with the
facility.
(4)
Financial Assurance Funding
(a)
Initial Payment for a New Facility . A solid waste disposal
facility owner or operator shall provide financial assurance in accordance with
this section, as approved by the Department, and prior to the facility
receiving wastes, in the following amounts:
(i) If financial assurance is provided with a
letter of credit, surety bond, or reserve account, the current estimate of the
amount required for closure and post-closure care as established in paragraph
A(3) above; and
(ii) If financial
assurance is provided with a cash trust fund, an amount equal to the current
cost estimate for closure and post-closure care to close the facility after the
first year of operation. Annual payments after that will be the total cost of
closure and post-closure care, divided by the number of years in the pay-in
period. The pay-in period shall be the years of expected operation of the
landfill minus one year. Trust fund payments in subsequent years must be
determined calculating the then current cost for closure and post-closure care,
subtracting the current value of the trust fund minus all taxes, brokerage
commissions and other expenses paid from the fund and dividing the remainder by
the number of years remaining in the pay-in period.
(b)
Initial Payment for Existing
Facilities . The owner or operator of an existing solid waste disposal
facility, if financial assurance for closure and post-closure care and
maintenance of that facility is not already being provided, shall provide
financial assurance in compliance with the provisions below.
(i) If financial assurance is provided with a
letter of credit, surety bond, or reserve fund, the amount provided in
subparagraph (4)(a)(i) above;
(ii)
If financial assurance is provided with a cash trust fund, an initial payment
into the trust fund of at least the amount that the fund would contain if the
trust fund had been established when the solid waste disposal facility became
operational and had received annual payments made according to the
specification of subparagraph (4)(a)(ii).
(c)
Annual Update of Costs
(i)
Modifications . The amount
of financial assurance must be calculated annually throughout the operating
life of the solid waste disposal facility. Without limitation, changes in the
amount of financial assurance are required due to modifications to the license,
changes in operation, changed financial or site conditions, inflation, changes
in the number of years remaining before anticipated closure, and changes in
legal requirements for closure or post-closure maintenance and care. The owner
or operator shall amend the financial assurance calculation annually based upon
current costs of a third party undertaking the closure and post-closure care
and other work required by the Department in accordance with then applicable
rule or an approved Closure Plan. This calculation shall be reported in writing
to the Department as part of the disposal facility's annual report and is
subject to Department review and approval. Upon approval, the owner/operator
must obtain financial assurance for any calculated increase within 60 days. The
amount of financial assurance may also be adjusted downward in accordance with
these provisions.
(ii)
Annual
Inflation Adjustment Method . When computing the annual inflation
adjustment for closure and post-closure trust funds, the owner or operator must
use the current Implicit Price Deflator for Gross Domestic Product as published
by the US. Department of Commerce in "Survey of Current Business" a successor
index, or other Department approved index.
(d)
Other Requirements
(i)
Funds Available when Needed
. All financial assurance mechanisms must ensure that the funds necessary to
meet the costs of closure and post-closure care will be available within 30
days of the Department's request for, or approval of, release of
funds.
(ii)
Valid
Mechanism . Each financial assurance mechanism must be legally valid,
binding, and enforceable under State and federal law. Trust fund arrangements
must be formalized in an agreement that is acceptable to the Department. Such a
trust fund should have substantially the same wording and conditions as the
example agreement in Appendix B of this Chapter. If an owner or operator elects
to use a form of trust agreement that differs materially from Appendix B of
this Chapter, the owner or operator shall pay the Department's reasonable costs
of review of the agreement which may include an outside independent attorney or
trust officer of the Department's choosing that has expertise in financial
assurance mechanisms. Each trust agreement must include a schedule that
contains the payment commitment of the owner or operator.
(iii)
Standby Trust Requirements
. If a facility owner or operator chooses to meet the financial assurance
requirements of this section through the use of letter(s) of credit and/or
surety bond(s), the owner or operator must also establish a standby trust fund
that stands ready to receive funds from the surety bond(s) or letter(s) of
credit unless this requirement is waived by the Department.
A standby trust shall be established that provides for
administration and oversight identical to those for an active trust fund.
(iv)
Department as
Beneficiary . The Department (or approved trustee for the benefit of the
Department) must be named as beneficiary of any financial assurance agreement,
with the right to withdraw funds and to use part or all of the funds in its
discretion in order to carry out legally required closure, post-closure care,
and monitoring and all costs related thereto. Withdrawal of any funds must be
approved in writing by the Department.
(e)
Allowable Assurance
Mechanisms . Unless otherwise specified in this section, the owner or
operator of a solid waste disposal facility that must provide financial
assurance under subsection A(1) above, must comply with the requirements of 40
CFR section 258. 70 through 40 CFR 258. 72[ii]as amended up to July 1, 2014.
The provisions of 40 CFR 258. 70 through 40 CFR 258. 72 and 40 CFR 258. 74(a),
(b), and (c) effective as of July 1, 2014[iii], are hereby adopted and
incorporated by reference, provided however that a standby trust fund must also
be established by the owner or operator of a solid waste disposal facility when
providing financial assurance through a letter of credit or a surety bond.
Financial assurance may also be provided by the establishment
of a reserve account for closure and post-closure care costs established in
accordance with the Internal Revenue Code. This method shall
only be available to owners/operators having book net worth shown on audited
financial statements in excess of $50,000,000 and tangible assets in Maine
excluding any landfill related assets, having depreciated book value in excess
of ten times the projected cost of closure and post-closure costs. This method
shall not be available after closure of the facility unless the operator
continues business operations in Maine that satisfy the foregoing financial
standards. The owner/operator must submit a sworn statement annually in
accordance with the annual reporting requirements of this section whether these
provisions are met and to provide sufficient information to confirm that sworn
statement. If, at any time, the owner/operator no longer meets the reserve
account provisions required above, the owner/operator must notify the
Department by registered mail within
7 days of becoming aware that the
standard is no longer met and must provide adequate alternative financial
assurance within not more that 23 days after the required notification
date.
For a municipally-owned solid waste disposal facility,
financial assurance may also be provided by meeting all provisions of 40 CFR
258. 74(f)[iv]as amended up to July, 2014.
The owner or operator of a solid waste disposal facility
may, subject to Department approval, satisfy the requirements of this
subsection by establishing more than one financial assurance mechanism per
facility. Each mechanism must comply with the provisions of this section except
that it is the combination of these mechanisms, rather than a single mechanism,
which must provide financial assurance in an amount at least equal to the total
cost of closure and post-closure care.
