Ariz. Admin. Code § 18-12-310

Current through Register Vol. 30, No. 45, November 8, 2024

Section R18-12-310 - Certificate of Deposit

A. Owners and operators may satisfy the corrective action requirements, but not the 3rd-party compensation requirements, of R18-12-303 by obtaining an irrevocable certificate of deposit and preparing a Certification and Agreement that conforms to the requirements of this Section. The issuing institution shall meet all of the following:

1. Has the authority to issue certificates of deposit in Arizona,

2. Certificate of deposit operations are regulated and examined by a federal or state agency,

3. Is a member of the Federal Deposit Insurance Corporation.

B. The certificate of deposit may be used for the full required amount of corrective action coverage. Alternatively, it may be used for part of the required amount of corrective action coverage when used in combination with other mechanisms allowed under this Article which provide the remaining amount of coverage. In all cases, the full required amount of 3rd-party compensation coverage shall be met with another mechanism or mechanisms allowed under this Article.

C. Owners and operators who use a certificate of deposit to meet the corrective action requirements of R18-12-303 shall comply with all of the following:

1. The certificate of deposit document and the records of the issuing institution shall designate the Department as the sole payee. The original certificate of deposit, a blank signature card, and the certification and agreement executed in accordance with subsection (D) shall be submitted to the Department. The Department shall return the signature card to the issuing institution with the current Director's signature and the signature of an alternative person designated by the Director affixed;

2. If the issuing institution is unwilling or unable to prepare a certificate of deposit made payable only to the Department, the owner or operator and the issuing institution shall prepare and execute an assignment in the presence of a notary public with a copy provided to the issuing institution which allows only the Department access to the certificate of deposit;

3. The owner or operator's Social Security or Tax Identification number shall appear on the certificate of deposit;

4. All interest accrued on the certificate of deposit shall be applied back to the certificate of deposit;

5. Upon verification by the Department that the requirements of this Article are met using another mechanism or combination of mechanisms, the owner or operator may submit a written request to the Director for release of the certificate of deposit. Within 30 days of receipt of the request from the owner or operator under this subsection, the Director shall release to the owner or operator the certificate of deposit and the certification and agreement.

D. The owner or operator shall prepare, execute, and submit to the Department and the issuing institution a Certification and Agreement which shall be worded as shown in Appendix A except that instructions in brackets are to be replaced with the relevant information and the brackets deleted.

E. The certificate of deposit shall be irrevocable with an automatically renewable term, the length of which may be specified by owners and operators. The initial term and the automatic renewal term shall be stated on the certificate of deposit.

F. The Department may present for payment any certificate of deposit to the issuing institution and receive cash if either of the following occur:

1. The owner or operator reports a release in accordance with A.R.S. § 49-1004 from an underground storage tank covered by the certificate of deposit and makes a written request to the Director for payment of corrective action expenses required under A.R.S. § 49-1005. If a request for payment is made the owner or operator shall submit an invoice for corrective action services which have been performed as required under A.R.S. § 49-1005;

2. The conditions of R18-12-322(B)(1) exist.

G. The Department shall pay, from funds received from cashing the certificate of deposit, corrective action expenses if they are determined to be reasonable and necessary.

H. The Director shall, within 30 days of the date on which the certificate of deposit is cashed, return to the owner or operator any funds received from cashing the certificate of deposit which are in excess of the amount of financial responsibility being demonstrated by the certificate of deposit. The Director shall place funds received from the certificate of deposit which have not been used to meet the expenses payable under subsection (G) in the UST Revolving Fund until such time as they are needed. If upon completion of all corrective action, as evidenced by a corrective action closure letter issued by the Department, the costs incurred for corrective action are less than the amount received from cashing of the certificate of deposit, any excess funds remaining after final payment shall be refunded to the owner or operator within 30 days of receipt by the Department of a written request for refund.

Ariz. Admin. Code § R18-12-310

Adopted effective July 30, 1996 (Supp. 96-3). Amended effective July 30, 1996 (Supp. 96-3). Amended by final rulemaking at 25 A.A.R. 3123, effective 10/1/2020.