DEPARTMENT OF PUBLIC HEALTH AND ENVIRONMENT

Solid and Hazardous Waste Commission/Hazardous Materials and Waste Management Division

6 CCR 1007-2
PART 1  REGULATIONS PERTAINING TO SOLID WASTE SITES AND FACILITIES

Amendments to Section 4 Financial Assurance Requirements

(Adopted by the Solid and Hazardous Waste Commission on May 19, 2020)

1) Revise the Table of Contents for Section 4 by deleting and reserving the listing for Section 4.6.9 (Local Government Guarantee) to read as follows:

SECTION 4	FINANCIAL ASSURANCE REQUIREMENTS

********   
4.6	Financial Assurance Requirements
	
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	4.6.8	Corporate Guarantee
	4.6.9	Reserved
	4.6.10	Certificates of Deposit

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2) Revise paragraph (D) of Section 4.6.1 to read as follows:

4.6	Financial Assurance Requirements

4.6.1: General Requirements

(A) All owners and operators must establish financial assurance for closure and post-closure of, and if necessary corrective action at, the solid waste disposal site and facility in the amounts determined by the cost estimates required in Sections 4.2 through 4.5 of these regulations.

(B) The department shall Consult with the local governing authority as required by these regulations in the following circumstances:

(1) Prior to accepting a solid waste disposal site and facility’s initial financial assurance via an application for a Certificate of Designation or other application or department requirement.

(2) Prior to accepting initial financial assurance for corrective action.

(3) Prior to terminating a site and facility’s financial assurance pursuant to Section 4.6.13.

(4) As necessary in Section 4.6.12.

(C) No local governing authority shall require an applicant for a certificate of designation to obtain any financial assurance mechanism or amount in addition to that required by the provisions of these regulations.

(D)The following are allowable financial assurance mechanisms and instruments that an owner or operator may use, alone or in combination, subject to approval by the department:

(1)  Trust fund
(2)  Letter of credit
(3)  Surety bond
(4)  Insurance
(5)  Corporate financial test
(6)  Local government financial test
(7)  Corporate guarantee
(8)  Certificate of Deposit

(E)  All owners and operators shall annually provide, concurrently to the department and the local governing authority, proof of sufficiency of the financial assurance required by these regulations.

3) Revise Section 4.6.7 (Local Government Financial Test) to read as follows:

4.6.7	Local Government Financial Test   

(A)  Subject to department approval, an owner or operator may demonstrate financial assurance at least equal to the cost estimates for closure, post-closure care and corrective action if the owner or operator is a local government. The owner or operator must prepare its financial statements and have them audited in conformity with generally accepted accounting principles for governments and have its financial statements audited by an independent certified public accountant.

(B)  Public Notice Component   

The local government owner or operator must place a reference to the closure, post-closure care, or corrective action costs into its next comprehensive annual financial report (CAFR) or audited financial statement after the effective date of this Section or prior to the initial receipt of waste at the facility, whichever is later. Disclosure must include the nature and source of closure and post-closure care requirements, the reported liability at the balance sheet date, the estimated total closure and post-closure care costs remaining to be recognized, the percentage of landfill capacity used to date, and the estimated landfill life in years. A reference to corrective action costs must be placed in the CAFR after the corrective action remedy has been selected in accordance with the requirements of these regulations. The reference may instead be placed in the operation record until issuance of the next available CAFR if timing does not permit the reference to be incorporated into the most recently issued CAFR or budget. For closure and post-closure costs, conformance with Government Accounting Standards Board Statement 18 assures compliance with this public notice.  The reference must include the amount of each cost-estimate and the year(s) in which the local government expects these costs to be incurred. References in the budget must occur as budgeted line items if the activities are to occur in the period covered by the budget, but may appear in a supplemental data section if the activities will not occur until after the period covered by the budget.
 
(C)  Recordkeeping and Reporting Requirements 

(1)  The local government owner or operator must place the following items in the facility's operating record and submit to the Department within seven (7) months following the close of the owner or operator’s fiscal year:

(a)  A letter signed by the local county commissioners or the governing body of the appropriate municipality that lists all the current cost estimates covered by a financial test, as described in Subsection 4.6.7(B)

(b)  The local government's independently audited year-end financial statements for the latest fiscal year, including the unqualified opinion of the auditor who must be an independent, certified public accountant or an appropriate State agency that conducts equivalent comprehensive audits; and

(c) A copy of the comprehensive annual financial report used to comply with this section or certification that the requirements of General Accounting Standards Board Statement 18 have been met.  

(d) Whenever the financial assurance cost estimates are replaced (typically every five years per Section 4.5.3 of these regulations), the owner or operator must ensure that the updated costs are included in the next CAFR.  If the effective date of the financial assurance cost estimate replacement is after the balance sheet date of the next CAFR, the change to the liability associated with landfill closure and post closure care costs may be reported in the CAFR issued the following year.

(e) In the case of corrective action, these cost estimates will need to be included in the next available CAFR in accordance with the requirements of Section 2.2 and Appendix B6.

(2)  The local government owner or operator is no longer required to meet the requirements of Subsection 4.6.7(C) when the owner or operator is released from the requirements of this Section in accordance with Section 4.6.13.

(3)  The department, after reviewing the CAFR submitted by the local government owner or operator, may require additional reports of financial condition from the local government at any time. If the department finds, on the basis of such reports or other information, that the owner or operator no longer maintains a positive net position at the end of the most recent fiscal year, the local government must provide alternate financial assurance in accordance with Subsection 4.6.7(C)(5).

4) Delete and reserve Section 4.6.9 to read as follows:
4.6.9	Reserved