NR 664.0143(4)(f)
(f) The letter of credit shall be issued in an amount at least equal to the current closure cost estimate, except as provided in sub.
(9).
NR 664.0143(4)(g)
(g) Whenever the current closure cost estimate increases to an amount greater than the amount of the credit, the owner or operator, within 60 days after the increase, shall either cause the amount of the credit to be increased so that it at least equals the current closure cost estimate and submit evidence of the increase to the department, or obtain other financial assurance as specified in this section to cover the increase. Whenever the current closure cost estimate decreases, the amount of the credit may be reduced to the amount of the current closure cost estimate following written approval by the department.
NR 664.0143(4)(h)
(h) Following a determination by the department or EPA pursuant to
42 USC 6928 that the owner or operator has failed to perform final closure in accordance with the closure plan and other license requirements when required to do so, the department may draw on the letter of credit.
NR 664.0143(4)(i)
(i) If the owner or operator does not establish alternate financial assurance as specified in this section and obtain written approval of the alternate assurance from the department within 90 days after receipt by both the owner or operator and the department of a notice from issuing institution that it has decided not to extend the letter of credit beyond the current expiration date, the department will draw on the letter of credit. The department may delay the drawing if the issuing institution grants an extension of the term of the credit. During the last 30 days of any extension the department will draw on the letter of credit if the owner or operator has failed to provide alternate financial assurance as specified in this section and obtain written approval of the assurance from the department.
NR 664.0143(4)(j)
(j) The department will authorize the release of the letter of credit when any of the following apply:
NR 664.0143(4)(j)1.
1. An owner or operator substitutes alternate financial assurance as specified in this section.
NR 664.0143(4)(j)2.
2. The department releases the owner or operator from the requirements of this section in accordance with sub.
(11).
NR 664.0143(5)(a)(a) An owner or operator may satisfy the requirements of this section by obtaining closure insurance which conforms to the requirements of this subsection and submitting a certificate of the insurance to the department. An owner or operator of a new facility shall submit the certificate of insurance to the department at least 60 days before the date on which hazardous waste is first received for treatment, storage or disposal. The insurance shall be effective before this initial receipt of hazardous waste. At a minimum, the insurer shall be licensed to transact the business of insurance, or eligible to provide insurance as an excess or surplus lines insurer, in one or more states. The department, after conferring with the Wisconsin insurance commissioner, shall determine the acceptability of a surplus lines or captive insurance company to provide coverage for proof of financial responsibility. The department shall ask the insurance commissioner to provide a financial analysis of the insurer including a recommendation as to the insurer's ability to provide the required coverage. The department may require a periodic review of the acceptability of a surplus lines or captive insurance company.
NR 664.0143(5)(c)
(c) The closure insurance policy shall be issued for a face amount at least equal to the current closure cost estimate, except as provided in sub.
(9). The term “face amount" means the total amount the insurer is obligated to pay under the policy. Actual payments by the insurer will not change the face amount, although the insurer's future liability will be lowered by the amount of the payments.
NR 664.0143(5)(d)
(d) The closure insurance policy shall guarantee that funds will be available to close the facility whenever final closure occurs. The policy shall also guarantee that once final closure begins, the insurer will be responsible for paying out funds, up to an amount equal to the face amount of the policy, upon the direction of the department, to the party or parties as the department specifies.
NR 664.0143(5)(e)
(e) After beginning partial or final closure, an owner or operator or any other person authorized to conduct closure may request reimbursements for closure expenditures by submitting itemized bills to the department. The owner or operator may request reimbursements for partial closure only if the remaining value of the policy is sufficient to cover the maximum costs of closing the facility over its remaining operating life. Within 60 days after receiving bills for closure activities, the department will instruct the insurer to make reimbursements in the amounts as the department specifies in writing, if the department determines that the partial or final closure expenditures are in accordance with the approved closure plan or otherwise justified. If the department has reason to believe that the maximum cost of closure over the remaining life of the facility will be significantly greater than the face amount of the policy, the department may withhold reimbursements of the amounts as the department deems prudent until the department determines, in accordance with sub.
(11), that the owner or operator is no longer required to maintain financial assurance for final closure of the facility. If the department does not instruct the insurer to make the reimbursements, the department will provide the owner or operator with a detailed written statement of reasons.
NR 664.0143(5)(f)
(f) The owner or operator shall maintain the policy in full force and effect until the department consents to termination of the policy by the owner or operator as specified in par.
(j). Failure to pay the premium, without substitution of alternate financial assurance as specified in this section, will constitute a significant violation of this chapter, warranting a remedy as the department deems necessary. The violation will be deemed to begin upon receipt by the department of a notice of future cancellation, termination or failure to renew due to nonpayment of the premium, rather than upon the date of expiration.
NR 664.0143(5)(g)
(g) Each policy shall contain a provision allowing assignment of the policy to a successor owner or operator. The assignment may be conditional upon consent of the insurer, provided the consent is not unreasonably refused.
NR 664.0143(5)(h)
(h) The policy shall provide that the insurer may not cancel, terminate or fail to renew the policy unless a replacement insurance policy or other proof of financial responsibility under this section is provided to the department by the owner or operator. The automatic renewal of the policy shall, at a minimum, provide the insured with the option of renewal at the face amount of the expiring policy. If the insurer elects to cancel, terminate or fail to renew the policy, the insurer shall provide notice by certified mail to the owner or operator and the department not less than 120 days prior to the proposed cancellation date. Cancellation, termination or failure to renew may not occur, however, during the 120 days beginning with the date of receipt of the notice by both the department and the owner or operator, as evidenced by the return receipts. Cancellation, termination or failure to renew may not occur and the policy will remain in full force and effect in the event that on or before the date of expiration any of the following apply:
NR 664.0143(5)(h)3.
3. Closure is ordered by the department or a U.S. district court or other court of competent jurisdiction.
NR 664.0143(5)(h)4.
4. The owner or operator is named as debtor in a voluntary or involuntary bankruptcy proceeding under 11 USC.
NR 664.0143(5)(i)
(i) Whenever the current closure cost estimate increases to an amount greater than the face amount of the policy, the owner or operator, within 60 days after the increase, shall either cause the face amount to be increased to an amount at least equal to the current closure cost estimate and submit evidence of the increase to the department, or obtain other financial assurance as specified in this section to cover the increase. Whenever the current closure cost estimate decreases, the face amount may be reduced to the amount of the current closure cost estimate following written approval by the department.
NR 664.0143(5)(j)
(j) The department will give written consent to the owner or operator that the owner or operator may terminate the insurance policy when any of the following apply:
NR 664.0143(5)(j)1.
1. An owner or operator substitutes alternate financial assurance as specified in this section.
NR 664.0143(5)(j)2.
2. The department releases the owner or operator from the requirements of this section in accordance with sub.
(11).
NR 664.0143(6)(a)
(a) An owner or operator of a disposal facility may use the net worth test to provide financial responsibility if all of the following are met:
NR 664.0143(6)(a)1.
1. Only a company that meets the definition in s.
289.41 (1) (b), Stats., may use the net worth method of providing proof of financial responsibility.
NR 664.0143(6)(a)2.
2. The owner or operator shall comply with the net worth test requirements of s.
289.41 (4),
(6) and
(7), Stats., and the minimum security requirements of s.
289.41 (9), Stats., whichever are applicable. The updated net worth test information required under s.
289.41 (4), Stats., shall be submitted annually to the department within 90 days after the close of the company's fiscal year.
NR 664.0143(6)(b)
(b) For companies with more than one facility, the total cost of compliance for all facilities shall be used to determine the net worth to closure and long-term care cost ratio.
NR 664.0143(7)
(7)
Closure deposit with the department. An owner may deposit cash, certificates of deposit or U.S. government securities with the department. The deposit must be accompanied by a signed duplicate original of Form 4430-028 as specified in s.
NR 664.0151 (14). The amount of the deposit shall be determined according to s.
NR 664.0142. Cash deposits placed with the department shall be segregated and invested in an interest bearing account. All interest payments shall be accumulated in the account. The department shall have the right to use part or all of the funds to carry out the closure requirements of the approved closure plan or the applicable requirements in s.
NR 664.0112 if the owner fails to do so.
NR 664.0143(8)(a)
(a) An owner or operator may satisfy the requirements of this section by establishing a closure escrow account which conforms to the requirements of this subsection and submitting an originally signed duplicate of the escrow agreement to the department. An owner or operator of a new facility shall submit the originally signed duplicate of the escrow agreement to the department at least 60 days before the date on which hazardous waste is first received for treatment, storage or disposal. The escrow agent shall be an entity which has the authority to act as an escrow agent, and the escrow account shall be established with a bank or financial institution which is examined and regulated by the state or a federal agency.
NR 664.0143(8)(b)
(b) The wording of the escrow agreement shall be identical to the wording on the department form specified in s.
NR 664.0151 (6) (a), and the escrow agreement shall be accompanied by a formal certification of acknowledgment as specified in s.
NR 664.0151 (6) (b). Schedule A of the escrow agreement shall be updated within 60 days after a change in the amount of the current closure cost estimate covered by the agreement.
NR 664.0143(8)(c)
(c) Payments into the escrow account shall be made annually by the owner or operator over the term of the initial license or over the remaining operating life of the facility as estimated in the closure plan, whichever period is shorter. For the purposes of this section, this period is referred to as the “pay-in period." The payments into the closure escrow account shall be made as follows:
NR 664.0143(8)(c)1.
1. For a new facility, the first payment shall be made before the initial receipt of hazardous waste for treatment, storage or disposal. A receipt from the escrow agent for this payment shall be submitted by the owner or operator to the department before this initial receipt of hazardous waste. The first payment shall be at least equal to the current closure cost estimate, except as provided in sub.
(9), divided by the number of years in the pay-in period. Subsequent payments shall be made no later than 30 days after each anniversary date of the first payment. The amount of each subsequent payment shall be determined by this formula:
where CE is the current closure cost estimate, CV is the current value of the escrow account and Y is the number of years remaining in the pay-in period.
NR 664.0143(8)(c)2.
2. If an owner or operator establishes a escrow account as specified in this subsection, and the value of that escrow account is less than the current closure cost estimate when a license is awarded for the facility, the amount of the current closure cost estimate still to be paid into the escrow account shall be paid in over the pay-in period as defined in the introduction to this paragraph. Payments shall continue to be made no later than 30 days after each anniversary date of the first payment made pursuant to ch.
NR 665. The amount of each payment shall be determined by this formula:
where CE is the current closure cost estimate, CV is the current value of the escrow account and Y is the number of years remaining in the pay-in period.
NR 664.0143(8)(d)
(d) The owner or operator may accelerate payments into the escrow account or may deposit the full amount of the current closure cost estimate at the time the account is established. However, the owner or operator shall maintain the value of the account at no less than the value that the account would have if annual payments were made as specified in par.
(c).
NR 664.0143(8)(e)
(e) If the owner or operator establishes a closure escrow account after having used one or more alternate mechanisms specified in this section or in s.
NR 665.0143, the first payment shall be in at least the amount that the account would contain if the escrow account were established initially and annual payments were made according to the specifications of this subsection and s.
NR 665.0143 (7), as applicable.
NR 664.0143(8)(f)
(f) After the pay-in period is completed, whenever the current closure cost estimate changes, the owner or operator shall compare the new estimate with the escrow agent's most recent annual valuation of the escrow account. If the value of the account is less than the amount of the new estimate, the owner or operator, within 60 days after the change in the cost estimate, shall either deposit an amount into the account so that its value after this deposit at least equals the amount of the current closure cost estimate, or obtain other financial assurance as specified in this section to cover the difference.
NR 664.0143(8)(g)
(g) If the value of the escrow account is greater than the total amount of the current closure cost estimate, the owner or operator may submit a written request to the department for release of the amount in excess of the current closure cost estimate.
NR 664.0143(8)(h)
(h) If an owner or operator substitutes other financial assurance as specified in this section for all or part of the escrow account, the owner or operator may submit a written request to the department for release of the amount in excess of the current closure cost estimate covered by the escrow account.
NR 664.0143(8)(i)
(i) Within 60 days after receiving a request from the owner or operator for release of funds as specified in par.
(g) or
(h), the department will instruct the escrow agent to release to the owner or operator funds as the department specifies in writing.
NR 664.0143(8)(j)
(j) After beginning partial or final closure, an owner or operator or another person authorized to conduct partial or final closure may request reimbursements for partial or final closure expenditures by submitting itemized bills to the department. The owner or operator may request reimbursements for partial closure only if sufficient funds are remaining in the escrow account to cover the maximum costs of closing the facility over its remaining operating life. Within 60 days after receiving bills for partial or final closure activities, the department will instruct the escrow agent to make reimbursements in those amounts as the department specifies in writing, if the department determines that the partial or final closure expenditures are in accordance with the approved closure plan, or otherwise justified. If the department has reason to believe that the maximum cost of closure over the remaining life of the facility will be significantly greater than the value of the escrow account, the department may withhold reimbursements of amounts as the department deems prudent until the department determines, in accordance with sub.
(11) that the owner or operator is no longer required to maintain financial assurance for final closure of the facility. If the department does not instruct the escrow agent to make the reimbursements, the department will provide the owner or operator with a detailed written statement of reasons.
NR 664.0143(8)(k)
(k) The department will agree to termination of the escrow account when one of the following applies:
NR 664.0143(8)(k)1.
1. An owner or operator substitutes alternate financial assurance as specified in this section.
NR 664.0143(8)(k)2.
2. The department releases the owner or operator from the requirements of this section in accordance with sub.
(11).
NR 664.0143(9)
(9)
Use of multiple financial mechanisms. An owner or operator may satisfy the requirements of this section by establishing more than one financial mechanism per facility. These mechanisms are limited to trust funds, deposits with the department, surety bonds guaranteeing payment, escrow accounts, letters of credit and insurance. The mechanisms shall be as specified in subs.
(1),
(2),
(4),
(5),
(7) and
(8), except that it is the combination of mechanisms, rather than the single mechanism, which shall provide financial assurance for an amount at least equal to the current closure cost estimate. The department may use any or all of the mechanisms to provide for closure of the facility.
NR 664.0143(10)
(10)
Use of a financial mechanism for multiple facilities. An owner or operator may use a financial assurance mechanism specified in this section to meet the requirements of this section for more than one facility. Evidence of financial assurance submitted to the department shall include a list showing, for each facility, the EPA identification number, name, address and the amount of funds for closure assured by the mechanism. If the facilities covered by the mechanism are in more than one state, identical evidence of financial assurance shall be submitted to and maintained with the state agency regulating hazardous waste or with the appropriate U.S. EPA regional administrator if the facility is located in unauthorized states. The amount of funds available through the mechanism shall be no less than the sum of funds that would be available if a separate mechanism had been established and maintained for each facility. In directing funds available through the mechanism for closure of any of the facilities covered by the mechanism, the department may direct only the amount of funds designated for that facility, unless the owner or operator agrees to the use of additional funds available under the mechanism.
NR 664.0143(11)
(11)
Release of the owner or operator from the requirements of this section. Within 60 days after receiving certifications from the owner or operator and a qualified professional engineer that final closure has been completed in accordance with the approved closure plan, the department will notify the owner or operator in writing that the owner or operator is no longer required by this section to maintain financial assurance for final closure of the facility, unless the department has reason to believe that final closure has not been in accordance with the approved closure plan. The department shall provide the owner or operator a detailed written statement of any reason to believe that closure has not been in accordance with the approved closure plan.
NR 664.0143 Note
Note: The department may consider other financial commitments as allowed by s.
289.41(3)(a)5., Stats.
NR 664.0143 History
History: CR 05-032: cr.
Register July 2006 No. 607, eff. 8-1-06;
CR 16-007: am. (6) (a) 2., (11)
Register July 2017 No. 739, eff. 8-1-17;
CR 19-082: am. (3) (e), (4) (h)
Register August 2020 No 776, eff. 9-1-20.
NR 664.0144
NR 664.0144 Cost estimate for long-term care. NR 664.0144(1)(1)
The owner or operator of a disposal surface impoundment, disposal miscellaneous unit or landfill unit, or of a surface impoundment or waste pile required under ss.
NR 664.0228 and
664.0258 to prepare a contingent closure and long-term care plan, shall have a detailed written estimate, in current dollars, of the annual cost of long-term care monitoring and maintenance of the facility according to the applicable long-term care rules in ss.
NR 664.0117 to
664.0120,
664.0228,
664.0258,
664.0310 and
664.0603.
NR 664.0144(1)(a)
(a) The long-term care cost estimate shall be based on the costs to the owner or operator of hiring a third party to conduct long-term care activities. A third party is a party who is neither a parent corporation nor a subsidiary of the owner or operator.
NR 664.0144(1)(b)
(b) The long-term care cost estimate is calculated by multiplying the annual long-term care cost estimate by the number of years of long-term care required under s.
NR 664.0117.
NR 664.0144(2)
(2) During the active life of the facility, the owner or operator shall adjust the long-term care cost estimate for inflation within 60 days prior to the anniversary date of the establishment of the financial instrument or instruments used to comply with s.
NR 664.0145. For owners or operators of disposal facilities using the net worth test, the long-term care cost estimate shall be updated for inflation as specified in s.
289.41 (5) (d), Stats. The adjustment may be made by recalculating the long-term care cost estimate in current dollars or by using an inflation factor derived from the most recent implicit price deflator for gross domestic product published by the U.S. department of commerce in its
Survey of Current Business as specified in pars.
(a) and
(b). The inflation factor is the result of dividing the latest published annual deflator by the deflator for the previous year.
NR 664.0144(2)(a)
(a) The first adjustment is made by multiplying the long-term care cost estimate by the inflation factor. The result is the adjusted long-term care cost estimate.
NR 664.0144(2)(b)
(b) Subsequent adjustments are made by multiplying the latest adjusted long-term care cost estimate by the latest inflation factor.
NR 664.0144(3)
(3) During the active life of the facility, the owner or operator shall revise the long-term care cost estimate within 30 days after the department has approved the request to modify the long-term care plan, if the change in the long-term care plan increases the cost of long-term care. The revised long-term care cost estimate shall be adjusted for inflation as specified in sub.
(2).
NR 664.0144(4)
(4) The owner or operator shall keep the following at the facility during the operating life of the facility: The latest long-term care cost estimate prepared in accordance with subs.
(1) and
(3) and, when this estimate has been adjusted in accordance with sub.
(2), the latest adjusted long-term care cost estimate.
NR 664.0144 History
History: CR 05-032: cr.
Register July 2006 No. 607, eff. 8-1-06;
CR 16-007: am. (2) (intro.)
Register July 2017 No. 739, eff. 8-1-17.
NR 664.0145
NR 664.0145 Financial assurance for long-term care. The owner or operator of a hazardous waste management unit subject to s.
NR 664.0144 shall establish financial assurance for long-term care according to the approved long-term care plan for the facility 60 days prior to the initial receipt of hazardous waste or the effective date of the rule, whichever is later. The owner or operator shall choose from the following options:
NR 664.0145(1)(a)
(a) An owner or operator may satisfy the requirements of this section by establishing a long-term care trust fund which conforms to the requirements of this subsection and submitting an originally signed duplicate of the trust agreement to the department. An owner or operator of a new facility shall submit the originally signed duplicate of the trust agreement to the department at least 60 days before the date on which hazardous waste is first received for disposal. The trustee shall be an entity which has the authority to act as a trustee and whose trust operations are regulated and examined by a federal or state agency.
NR 664.0145(1)(b)
(b) The wording of the trust agreement shall be identical to the wording on the department form specified in s.
NR 664.0151 (1) (a) and the trust agreement shall be accompanied by a formal certification of acknowledgment as specified in s.
NR 664.0151 (1) (b). Schedule A of the trust agreement shall be updated within 60 days after a change in the amount of the current long-term care cost estimate covered by the agreement.
NR 664.0145(1)(c)
(c) Payments into the trust fund shall be made annually by the owner or operator over the term of the initial license or over the remaining operating life of the facility as estimated in the closure plan, whichever period is shorter. For the purposes of this section, this period is referred to as the “pay-in period." The payments into the long-term care trust fund shall be made as follows:
NR 664.0145(1)(c)1.
1. For a new facility, the first payment shall be made before the initial receipt of hazardous waste for disposal. A receipt from the trustee for this payment shall be submitted by the owner or operator to the department before this initial receipt of hazardous waste. The first payment shall be at least equal to the current long-term care cost estimate, except as provided in sub.
(9), divided by the number of years in the pay-in period. Subsequent payments shall be made no later than 30 days after each anniversary date of the first payment. The amount of each subsequent payment shall be determined by this formula:
where CE is the current long-term care cost estimate, CV is the current value of the trust fund and Y is the number of years remaining in the pay-in period.
NR 664.0145(1)(c)2.
2. If an owner or operator establishes a trust fund as specified in this subsection, and the value of that trust fund is less than the current long-term care cost estimate when a license is awarded for the facility, the amount of the current long-term care cost estimate still to be paid into the fund shall be paid in over the pay-in period as defined in par.
(c) (intro). Payments shall continue to be made no later than 30 days after each anniversary date of the first payment made pursuant to ch.
NR 665. The amount of each payment shall be determined by this formula:
where CE is the current long-term care cost estimate, CV is the current value of the trust fund and Y is the number of years remaining in the pay-in period.
NR 664.0145(1)(d)
(d) The owner or operator may accelerate payments into the trust fund or may deposit the full amount of the current long-term care cost estimate at the time the fund is established. However, the owner or operator shall maintain the value of the fund at no less than the value that the fund would have if annual payments were made as specified in par.
(c).
NR 664.0145(1)(e)
(e) If the owner or operator establishes a long-term care trust fund after having used one or more alternate mechanisms specified in this section or in s.
NR 665.0145, the first payment shall be in at least the amount that the fund would contain if the trust fund were established initially and annual payments made according to specifications of this subsection and s.
NR 665.0145 (1), as applicable.
NR 664.0145(1)(f)
(f) After the pay-in period is completed, whenever the current long-term care cost estimate changes during the operating life of the facility, the owner or operator shall compare the new estimate with the trustee's most recent annual valuation of the trust fund. If the value of the fund is less than the amount of the new estimate, the owner or operator, within 60 days after the change in the cost estimate, shall either deposit an amount into the fund so that its value after this deposit at least equals the amount of the current long-term care cost estimate, or obtain other financial assurance as specified in this section to cover the difference.
NR 664.0145(1)(g)
(g) During the operating life of the facility, if the value of the trust fund is greater than the total amount of the current long-term care cost estimate, the owner or operator may submit a written request to the department for release of the amount in excess of the current long-term care cost estimate.
NR 664.0145(1)(h)
(h) If an owner or operator substitutes other financial assurance as specified in this section for all or part of the trust fund, the owner or operator may submit a written request to the department for release of the amount in excess of the current long-term care cost estimate covered by the trust fund.
NR 664.0145(1)(i)
(i) Within 60 days after receiving a request from the owner or operator for release of funds as specified in par.
(g) or
(h), the department will instruct the trustee to release to the owner or operator funds as the department specifies in writing.
NR 664.0145(1)(j)
(j) During the period of long-term care, the department may approve a release of funds if the owner or operator demonstrates to the department that the value of the trust fund exceeds the remaining cost of long-term care.
NR 664.0145(1)(k)
(k) An owner or operator or any other person authorized to conduct long-term care may request reimbursements for long-term care expenditures by submitting itemized bills to the department. Within 60 days after receiving bills for long-term care activities, the department will instruct the trustee to make reimbursements in those amounts as the department specifies in writing, if the department determines that the long-term care expenditures are in accordance with the approved long-term care plan or otherwise justified. If the department does not instruct the trustee to make the reimbursements, the department will provide the owner or operator with a detailed written statement of reasons.
NR 664.0145(1)(L)
(L) The department will agree to termination of the trust when one of the following applies:
NR 664.0145(1)(L)1.
1. An owner or operator substitutes alternate financial assurance as specified in this section.
NR 664.0145(1)(L)2.
2. The department releases the owner or operator from the requirements of this section in accordance with sub.
(11).
NR 664.0145(2)
(2)
Surety bond guaranteeing payment into a long-term care trust fund.
