Nebraska Administrative Code
Topic - ENVIRONMENT AND ENERGY
Title 135 - NEBRASKA DEPARTMENT OF ENVIRONMENTAL CONTROL
Chapter 7 - FINANCIAL RESPONSIBILITY
Section 135-7-003 - Terms and Conditions of the Bond
Universal Citation: 135 NE Admin Rules and Regs ch 7 ยง 003
Current through November 25, 2023
003.01 Replacement of Bonds
003.01A The Department may allow the
permittee to replace an approved bond with another type of bond described in
002 above, if the liability which has accrued against the permittee on the
permit area is transferred to such replacement bonds.
003.01B The Department shall not release
existing bonds until the permittee has submitted and the Department has
approved acceptable replacement bonds.
003.02 Surety bonds shall be subject to the following conditions:
003.02A The bond may be
subject to cancellation by the surety company; provided that, no such
cancellation, nor release of the surety company's liability under the bond,
shall be effective sooner than one hundred twenty days following receipt by the
Department and the permittee of written notice of cancellation sent by
certified mail, return receipt requested. Such one hundred twenty day period
shall be measured from the later of the receipt by the Department or permittee
of such notice. In the event of cancellation, the permittee must provide a
replacement bond in accordance with subsection 003.01 no later than forty-five
days prior to the effective date of cancellation specified in the notice.
Failure of the permittee to obtain a replacement bond shall result in
revocation of its bond.
003.02B The
bond shall provide that the surety and the permittee shall be jointly and
severally liable to the amount of such bond.
003.02C The bond shall provide that:
003.02C1 The surety will give prompt notice
to the permittee and the Department of any notice received or action filed
alleging the insolvency or bankruptcy of the surety, or alleging any violation
of regulatory requirements that could result in suspension or revocation of the
surety's license to do business;
003.02C2 In the event the surety becomes
unable to fulfill its obligations under the bond for any reason, notice shall
be given immediately to the permittee and the Department; and
003.02C3 Upon the incapacity of a surety by
reason of bankruptcy, insolvency or suspension or revocation of its license,
the permittee shall obtain a replacement bond within sixty days. Failure of the
permittee to obtain a replacement bond shall result in revocation of its
permit.
003.03 Collateral bonds, except for letters of credit, shall be subject to the following conditions:
003.03A The Department
shall value collateral at its current market value, not face value;
and
003.03B The Department shall
only accept certificates of deposit which are automatically
renewable.
003.04 Irrevocable letters of credit shall be subject to the following conditions:
003.04A The letter shall be payable to the
State of Nebraska in part or in full upon demand and receipt from the
Department of a notice or forfeiture pursuant to section 005.03
below;
003.04B The letter shall
contain terms which authorize the Department to draw upon the letter, in full,
to obtain cash collateral in the event the permittee has failed to furnish a
replacement bond at least thirty days prior to the expiration of the letter;
and
003.04C The total amount of
letters of credit that will be accepted from any bank for any permittee, on all
permits held by the permittee, shall not exceed the bank's maximum legal
lending limit as required by the appropriate Nebraska or Federal banking
regulatory agency.
003.04D The
letter of credit shall provide that:
003.04D1
The bank shall give prompt notice to the permittee and the Department of any
notice received or action filed alleging the insolvency or bankruptcy of the
bank, or alleging any violations of regulatory requirements which could result
in suspension or revocation to the bank's charter or license to do business;
003.04D2 In the event the bank
becomes unable to fulfill its obligations under the letter of credit for any
reason, notice shall be given immediately to the permittee and the Department;
and
003.04D3 Upon the incapacity of
a bank by reason or bankruptcy, insolvency, or suspension or revocation of its
charter or license, the permittee shall obtain a replacement bond within sixty
days. Failure of the permittee to obtain a replacement bond shall result in
revocation of its permit.
Disclaimer: These regulations may not be the most recent version. Nebraska 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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