Current through Register Vol. 41, No. 3, September 23, 2024
A. The operator
of any tank vessel entering upon state waters that does not have a Certificate
of Financial Responsibility approved by the U.S. Coast Guard pursuant to §
4202 of the federal Oil Pollution Act of 1990 (33
USC §
1321) shall deposit with the
department cash or its equivalent in the amount of $500 per gross ton of such
vessel. If the operator owns or operates more than one tank vessel, evidence of
financial responsibility need be established only to meet the maximum liability
applicable to the vessel having the greatest maximum liability.
1. All documents submitted shall be in
English and all monetary terms shall be in United States currency.
2. A copy of the department's acceptance of
the required evidence of financial responsibility shall be kept on the tank
vessel and readily available for inspection.
B. If the department determines that oil has
been discharged in violation of applicable state law or there is a substantial
threat of such discharge from a vessel for which a cash deposit has been made,
any amount held in escrow may be used to pay any fines, penalties or damages
imposed under such law.
C.
Operators of tank vessels may obtain exemption from the cash deposit
requirement if evidence of financial responsibility is provided in an amount
equal to the cash deposit required for such tank vessel pursuant to §
62.1-44.34:16 of the Code of Virginia and subsection A of this section. The
following means of providing such evidence, or any combination thereof, will be
acceptable:
1. Self-insurance. Any operator
demonstrating financial responsibility by self-insurance shall provide evidence
of such self-insurance in a manner that is satisfactory to the department. An
operator demonstrating self-insurance shall:
a. Maintain, in the United States, working
capital and net worth each in the amount required by § 62.1-44.34:16 of
the Code of Virginia and subsection A of this section.
(1) Maintenance of the required working
capital and net worth shall be demonstrated by submitting with the application
form an annual, current nonconsolidated balance sheet and an annual, current
nonconsolidated statement of income and surplus certified by an independent
certified public accountant. Those financial statements shall be for the
operator's last fiscal year preceding the date of application and shall be
accompanied by an additional statement from the operator's treasurer (or
equivalent official) certifying to both the amount of current assets and the
amount of total assets included in the accompanying balance sheet which are
located in the United States and are acceptable for purposes of this
chapter.
(2) If the balance sheet
and statement of income and surplus cannot be submitted in nonconsolidated
form, consolidated statements may be submitted if accompanied by an additional
statement by the involved certified public accountant certifying to the amount
by which the operator's assets, located in the United States and acceptable
under this subsection C, exceed total liabilities and that current assets,
located in the United States and acceptable under this subsection C, exceed its
current liabilities.
(3) When the
operator's demonstrated net worth is not at least 10 times the required amount,
an affidavit shall be filed by the operator's treasurer (or equivalent
official) covering the first six months of the operator's fiscal year. Such
affidavits shall state that neither the working capital nor the net worth have
fallen below the required amounts during the first six months.
(4) Additional financial information shall be
submitted upon request by the department; or
b. Provide evidence in the form of a marine
insurance broker's certificate of insurance, certificate of entry, or other
proof satisfactory to the department that the operator has obtained oil
pollution liability coverage through an operator's membership in a Protection
& Indemnity (P&I) Club that is a member of the international group of
P&I clubs or through coverage provided by a pool of marine underwriters in
an amount sufficient to meet the requirements of § 62.1-44.34:16 of the
Code of Virginia and subsection A of this section.
2. Insurance. Any operator demonstrating
evidence of financial responsibility by insurance shall provide evidence of
insurance issued by an insurer licensed, approved, or otherwise authorized to
do business in the Commonwealth of Virginia. The amount of insurance shall be
sufficient to cover the amount required by § 62.1-44.34:16 of the Code of
Virginia and subsection A of this section. The operator shall provide evidence
of such coverage in the form of a marine insurance broker's certificate of
insurance or by utilizing a form worded identically to the Insurance Form
Furnished as Evidence of Financial Responsibility in Respect of Liability for
Discharge of Oil available from the department. The insurer must also comply
with all requirements in the form available from the department.
3. Surety. Any operator demonstrating
financial responsibility through a surety bond shall file a surety bond
utilizing a form worded identically to the surety form available from the
department. The surety company issuing the bond must be licensed to operate as
a surety in the Commonwealth of Virginia and must possess an underwriting
limitation at least equal to the amount required by § 62.1-44.34:16 of the
Code of Virginia and subsection A of this section. The surety must also comply
with all requirements in the Surety Bond Form Furnished as Evidence of
Financial Responsibility in Respect of Liability for Discharge of Oil available
from the department.
4. Guaranty.
An operator demonstrating financial responsibility through a guaranty shall
submit the guaranty worded identically to the form available from the
department. The guarantor shall comply with all provisions of subdivision 1 of
this subsection for self-insurance and also comply with all requirements in the
Guaranty Form Furnished as Evidence of Financial Responsibility in Respect of
Liability for Discharge of Oil available from the department.
D. To obtain exemption from the
cash deposit requirements:
1. The operator
shall have and maintain an agent for service of process in the
Commonwealth;
2. Any insurer,
guarantor, or surety shall have and maintain an agent for service of process in
the Commonwealth;
3. Any insurer
must be authorized by the Commonwealth of Virginia to engage in the insurance
business; and
4. Any instrument of
insurance, guaranty or surety must provide that actions may be brought on such
instrument of insurance, guaranty or surety directly against the insurer,
guarantor or surety for any violation by the operator of Article 11 (§
62.1-44.34:14 et seq.) of Chapter 3.1 of Title 62.1 of the Code of Virginia up
to, but not exceeding, the amount insured, guaranteed or otherwise
pledged.
5. All forms of evidence
of financial responsibility shall be accompanied by an endorsement that
certifies that the insurance policy, evidence of self-insurance, surety or
guaranty provides liability coverage for the tank vessels in the amount
required by § 62.1-44.34:16 of the Code of Virginia and subsection A of
this section.
6. Subdivisions 2, 3
and 4 of this subsection do not apply to operators providing evidence of
financial responsibility in accordance with subdivision C 1 of this
section.
E. Any operator
whose financial responsibility is accepted under this chapter shall notify the
department at least 30 days before the effective date of a change, expiration
or cancellation of any instrument of insurance, guaranty or surety.
F. The department's approval of evidence of
financial responsibility shall expire:
1. One
year from the date that the department exempts an operator from the cash
deposit requirement based on acceptance of evidence of
self-insurance;
2. On the effective
date of any change in the operator's instrument of insurance, guaranty or
surety; or
3. Upon the expiration
or cancellation of any instrument of insurance, guaranty or surety.
G. All nonexempt tank vessel
operators shall file with the department the Application for Approval of
Evidence of Tank Vessel Financial Responsibility which identifies the tank
vessel operator and agent for service of process by name and address, provides
identifying information on the tank vessel or vessels and certifies to the
department that the information is true and accurate for approval of the
evidence of financial responsibility. This form is available. This form shall
be submitted with the required evidence of financial responsibility (cash
deposit, proof of insurance, self-insurance, guaranty or surety), and shall be
completed as far as it pertains to the tank vessel. The operator must sign and
date the certification statement on the application form. If the operator is a
corporation, the application form must be signed by an authorized corporate
official; if the operator is a municipality, state, federal or other public
agency, the application form must be signed by an authorized executive officer
or ranking elected official; if the operator is a partnership or sole
proprietorship, the application form must be signed by a general partner or the
sole proprietor.
H. Application for
renewal of approval of tank vessel financial responsibility shall be filed with
the department 30 days prior to the date of expiration.
I. All applications and written
communications concerning changes, submissions and updates required by this
chapter, with the exception of applications and submissions accompanied by fees
as addressed in subsection K of this section, shall be addressed as follows:
Mailing Address:
Virginia Department of Environmental Quality
Office of Spill Response and Remediation
P.O. Box 1105
Richmond, VA 23218
Location Address:
Virginia Department of Environmental Quality
Office of Spill Response and Remediation
1111 East Main Street, Suite 1400
Richmond, VA 23219
All applications and submissions accompanied by fees as
addressed in subsection K of this section shall be sent to the address listed
in subdivision K 2.
J. The
department, after notice and opportunity for hearing, may revoke its acceptance
of evidence of financial responsibility if it determines that:
1. Acceptance has been procured by fraud or
misrepresentation; or
2. A change
in circumstances has occurred that would warrant denial of acceptance of
evidence of financial responsibility.
K. An application for approval of the
demonstration of financial responsibility will be accepted only when the fees
established by this section have been paid.
1. Fees shall only be paid upon initial
submittal of the demonstration of financial responsibility by an operator to
the department. Renewals or changes are not subject to the administrative
fee.
2. Fees shall be paid in
United States currency by check, draft or postal money order made payable to
Treasurer of Virginia. All fees and accompanying applications and submissions
shall be sent to:
Mailing Address:
Virginia Department of Environmental Quality
Office of Financial Management
P.O. Box 1105
Richmond, VA 23218
Location Address:
Virginia Department of Environmental Quality
Office of Financial Management
1111 East Main Street, Suite 1400
Richmond, VA 23219
3. Application fees for approval of evidence
of financial responsibility for tank vessels are as follows:
a. Applicants shall pay an application fee of
$120.
b. Applicants shall pay a fee
of $30 for each additional tank vessel requiring a copy of the accepted
evidence of financial responsibility.
4. Application fees are refundable upon
receipt of a written notice of withdrawal; of the proffer of financial
responsibility and a request for refund received by the department no later
than 30 days after submittal and prior to approval.
5. Overpayments of application fees are
refundable upon written request. Overpayments not refunded will be credited for
the applicant's future use under this section.
Statutory Authority: §§ 62.1-44.15,
62.1-44.34:16, and 62.1-44.34:21 of the Code of
Virginia.
