Current through September 21, 2024
Financial assurance shall be accepted in a lump sum to be
used for any purpose under these regulations. Financial assurance shall be
executed in the amount calculated following the methods specified in these
regulations. By offering the forms of financial assurance required to meet
closure and corrective action requirements, the permittee of a confined swine
feeding operation and its surety represent that the form of financial assurance
offered is binding, irrevocable, unconditional, is financially guaranteed by
assets sufficient to meet the obligation, is a valid instrument made payable to
the Department, and fully complies with these regulations. The following forms
of financial assurance may be accepted:
(a) A letter of credit. A letter of credit
shall be subject to the following conditions:
(i) A letter of credit shall be accepted only
from a bank or lending institution licensed to do business in the State of
Wyoming and subject to banking laws and regulations of the State of Wyoming
with more than 50 percent of the bank's assets residing in the U.S.
(ii) The letter shall be irrevocable during
its term. The Department may approve the use of a letter of credit as security
according to a schedule approved within the permit. Any bank or lending
institution issuing a letter of credit shall notify the Director in writing by
certified mail at least ninety (90) days before the maturity date or expiration
of the letter of credit agreement of its intent not to extend the letter of
credit. A letter of credit shall be forfeited if not replaced by another form
of financial assurance thirty (30) days before expiration of the letter of
credit. All forms of financial assurance shall be approved by the Department
before being accepted. A forfeited letter of credit shall be converted to cash
by the bank or lending institution and the cash transferred to the
Department.
(iii) Letters of credit
shall be made payable to the Department both in writing and upon the records of
the bank issuing the letter of credit. Letters of credit must be payable upon
demand by the Department and the lending institutions or banks issuing letters
of credit are required to waive all rights of set off or liens against the
letters of credit.
(iv) The letter
of credit shall not be more than ten (10) percent of the bank's capital surplus
account as shown on a balance sheet and a financial statement certified by a
certified public accountant in good standing.
(v) No bank or lending institution shall
issue a letter of credit to any person or entity, on any permit or financial
assurance requirement required of that person or entity, in excess amounts
allowed under
W.S.
13-3-402. Violation of this provision shall
be deemed a violation of the permit and the Department shall declare forfeiture
of the letter of credit.
(vi) In
addition to those requirements set forth above, letters of credit shall provide
that:
(A) The bank or lending institution
shall give prompt notice to the permittee and the Director by certified mail of
any notice received or action filed alleging the insolvency or bankruptcy of
the bank or lending institution, or alleging any violations of regulatory
requirements that could result in suspension or revocation of the bank or
lending institution's charter or license to do business.
(B) In the event the bank or lending
institution becomes unable to fulfill its obligations under the letter of
credit for any reason, notice shall immediately be given to the permittee and
the Director by certified mail. In the event the permittee becomes aware that
the institution providing a letter of credit has become unable to fulfill its
obligations, the permittee shall immediately notify the Director by certified
mail.
(C) The permittee is in
violation of the permit if the financial assurance becomes invalid due to
failure of the issuing bank or lending institution. The bank or lending
institution shall be considered incapacitated due to bankruptcy, insolvency,
lapse, suspension, or revocation of its charter or license to do business in
Wyoming, or violation of the requirements set forth in these regulations. The
Director shall issue a notice of violation to any permittee without financial
assurance requiring replacement coverage within sixty (60) days. During this
period the Director or a designated representative shall conduct weekly
inspections to ensure continuing compliance with the permit. If any other
permit conditions are violated, the Director may suspend the permit.
(vii) Nothing herein shall limit
the right to serve any process, notice , or demand required or permitted by law
to be served upon the bank.
(b) Surety bonds. A surety shall not be
considered good and sufficient for purposes of these regulations unless:
(i) It is licensed to do business in the
State of Wyoming.
(ii) The surety
holds the highest rating under the following rating services:
(A) Standard and Poors.
(B) Moodys.
(C) Others accepted by the
Division.
(iii) The
estimated bond amount does not exceed the limit of risk as provided for in
W.S.
26-5-110, nor raise the total of all bonds
held by the applicant under that surety above three (3) times the limit of
risk.
(iv) The surety agrees:
(A) Not to cancel the bond, except where the
Department gives prior written approval of a good and sufficient replacement
form of financial assurance complying with these regulations.
(B) To be jointly and severally liable with
the permittee for closure and corrective actions as required by Part E of this
regulation.
(C) To provide
immediate written notice to the Department and permittee once it becomes unable
or may become unable to fulfill its obligations under the bond.
(D) To warrant in the bond instrument that
the bond is authorized, is fully enforceable, and is backed by sufficient
assets to guarantee execution on the bond.
(E) To further warrant that the bond shall be
payable to the Department upon demand and shall not be subject to any liens or
setoffs.
(v) If, for any
reason, the surety becomes unable to fulfill its obligations under the bond,
the permittee and surety shall immediately provide the required notice to the
Department. The permittee shall have sixty (60) days to secure alternative
bonding complying with the provisions of these regulations. Failure to provide
notice to the Department or failure to secure alternative bonding shall result
in suspension of the permit.
(c) Federally insured certificate of deposit.
The Department shall not accept an individual federally insured certificate of
deposit in an amount in excess of the maximum insur-able amount as determined
by the FDIC. Such certificates of deposit shall be made payable to the
Department both in writing and upon the records of the bank issuing the
certificate of deposit. All certificates of deposit shall be retained by the
Wyoming State Treasurer and shall be payable on demand. The Department shall
require the bank or lending institution issuing the certificate to waive all
rights of set off or liens against the certificate. The amount of the
certificate of deposit shall be calculated after any penalty for payment before
maturity is deducted.
(d)
Government-backed securities. In lieu of a bond, the permittee or its principal
may deposit government securities registered solely in the Department 's name
and backed by the full faith and credit of the United States. The market value
of the securities shall be utilized to value the security.
(e) Cash. In lieu of a bond, the permittee or
its principal may provide cash to be retained on deposit by the Wyoming State
Treasurer in the name of the Department. Interest shall not be earned on amount
of cash deposited in lieu of a bond or other form of financial
assurance.
