Ariz. Admin. Code § 18-12-317

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

Section R18-12-317 - Local Government Fund

A. Local government owners and operators may satisfy the requirements of R18-12-303 by establishing a dedicated fund account that conforms to the requirements of this Section. Except as specified in subsection (A)(2), a dedicated fund may not be commingled with other funds or otherwise used in normal operations. A dedicated fund shall be considered eligible if it meets one of the following requirements:

1. The fund is dedicated by state constitutional provision, or local government statute, charter, ordinance, or order to pay for taking corrective action and for compensating 3rd parties for bodily injury and property damage caused by accidental releases arising from the operation of petroleum underground storage tanks and is funded for the full amount of coverage required under R18-12-303, or funded for part of the required amount of coverage and used in combination with other mechanisms that provide the remaining coverage;

2. The fund is dedicated by state constitutional provision, or local government statute, charter, ordinance, or order as a contingency fund for general emergencies, including taking corrective action and compensating 3rd parties for bodily injury and property damage caused by accidental releases arising from the operation of petroleum underground storage tanks, and is funded for five times the full amount of coverage required under R18-12-303, or funded for part of the required amount of coverage and used in combination with other mechanisms that provide the remaining coverage. If the fund is funded for less than five times the amount of coverage required under R18-12-303, the amount of financial responsibility demonstrated by the fund may not exceed 1/5 the amount in the fund;

3. The fund is dedicated by state constitutional provision, or local government statute, charter, ordinance or order to pay for taking corrective action and for compensating 3rd parties for bodily injury and property damage caused by accidental releases arising from the operation of petroleum underground storage tanks. A payment is made to the fund once every year for seven years until the fund is fully-funded. This seven-year period is referred to as the "pay-in-period." The amount of each payment shall be determined by the following formula:

TF - CF / Y

where TF is the total required financial assurance for the owner or operator, CF is the current amount in the fund, and Y is the number of years remaining in the pay-in-period, and one of the following is met:

a. The local government owner or operator has available bonding authority, approved through voter referendum, if such approval is necessary prior to the issuance of bonds, for an amount equal to the difference between the required amount of coverage and the amount held in the dedicated fund. This bonding authority shall be available for taking corrective action and for compensating 3rd parties for bodily injury and property damage caused by accidental releases arising from the operation of petroleum underground storage tanks;

b. The local government owner or operator has a letter signed by the state attorney general stating that the use of the bonding authority will not increase the local government's debt beyond the legal debt ceilings established by the relevant state laws. The letter shall also state that prior voter approval is not necessary before use of the bonding authority.

B. To demonstrate that it meets the requirements of the local government fund, the chief financial officer of the local government owner or operator, or guarantor, or both, shall sign a letter worded exactly as provided in 40 CFR 280.107(d), amended as of October 13, 2015, except that the instructions in brackets are to be replaced by the relevant information and the brackets deleted.

Ariz. Admin. Code § R18-12-317

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