Mich. Admin. Code R. 29.2167

Current through Vol. 24-22, December 15, 2024

Section R. 29.2167 - Local government guarantee

Rule 67. Section 280.106 is amended to read as follows:

Section 280.106.

(a) A local government O/O may satisfy the requirements of section 280.93 by obtaining a guarantee that conforms to the requirements of this section. The guarantor shall be either the state in which the local government O/O is located or a local government having a substantial governmental relationship with the owner and operator and issuing the guarantee as an act incident to the relationship. A local government acting as the guarantor shall demonstrate 1 of the following:

(1) That it meets the bond rating test requirement of section 280.104 and shall deliver a copy of the chief financial officer's letter as contained in subsection 280.104(d) and (e) to the local government O/O.

(2) That it meets the worksheet test requirements of section 280.105 and shall deliver a copy of the chief financial officer's letter as contained in subsection 280.105(c) to the local government O/O.

(3) That it meets the local government fund requirements of section 280.107(a), (b), or (c) and shall deliver a copy of the chief financial officer's letter as contained in section 280.107 to the local government O/O.

(b) If the local government guarantor is unable to demonstrate financial assurance under section 280.104, 280.105, 280.107(a), 280.107(b), or 280.107(c) at the end of the financial reporting year, then the guarantor shall send, by certified mail, before cancellation or nonrenewal of the guarantee, notice to the O/O. The guarantee will terminate not less than 120 days after the date the O/O receives the notification, as evidenced by the return receipt. The O/O shall obtain alternative coverage as specified in subsection 280.114(e).

(c) The guarantee agreement must be worded as specified in subsection (d) or (e) of this section, depending on which of the following alternative guarantee arrangements is selected:

(1) If, in the default or incapacity of the O/O, the guarantor guarantees to fund a standby trust as directed by the director of the implementing agency, then the guarantee must be worded as specified in subsection (d) of this section.

(2) If, in the default or incapacity of the O/O, the guarantor guarantees to make payments as directed by the director of the implementing agency for taking corrective action or compensating third parties for bodily injury and property damage, then the guarantee must be worded as specified in subsection (e) of this section.

(d) If the guarantor is a state, then the local government guarantee with standby trust must be worded as specified in subdivision (1) of this subsection, except that instructions in brackets are to be replaced with relevant information and the brackets deleted. If the guarantor is a local government, then the local government guarantee with standby trust must be worded as specified in subdivision (2) of this subsection, except that instructions in brackets are to be replaced with relevant information and the brackets deleted. Subdivisions (1) and (2) of this subsection read as follows:

(1) Local government guarantee with standby trust made by a state guarantee made this [date] by [name of state], herein referred to as guarantor, to [the state implementing agency] and to any and all third parties, and obliges, on behalf of [local government owner or operator].

Recitals

(i) Guarantor is a state.

(ii) [Local government owner or operator] owns or operates the following underground storage tank(s) covered by this guarantee: [list the number of tanks at each facility and the name(s) and address(es) of the facility(ies) where the tanks are located. If more than 1 instrument is used to assure different tanks at any 1 facility, for each tank covered by this instrument, list the tank identification number provided in the notification submitted pursuant to 40 C.F.R. Part 280 or the corresponding state requirement, and the name and address of the facility.] This guarantee satisfies 40 C.F.R. Part 280, subpart H, requirements for assuring funding for [insert: "taking corrective action" and/or "compensating third parties for bodily injury and property damage caused by" either "sudden accidental releases" or "nonsudden accidental releases" or "accidental releases"; if coverage is different for different tanks or locations, indicate the type of coverage applicable to each tank or location] arising from operating the above identified underground storage tank(s) in the amount of [insert dollar amount] per occurrence and [insert dollar amount] annual aggregate.

(iii) Guarantor guarantees to [implementing agency] and to any and all third parties that:

In the event that [local government owner or operator] fails to provide alternative coverage within 60 days after receipt of a notice of cancellation of this guarantee and the [director of the implementing agency] has determined or suspects that a release has occurred at an underground storage tank covered by this guarantee, the guarantor, upon instructions from the [director] shall fund a standby trust fund in accordance with the provision of 40 C.F.R. Part 280.112, in an amount not to exceed the coverage limits specified above.

In the event that the [director] determines that [local government owner or operator] has failed to perform corrective action for releases arising out of the operation of the above-identified tank(s) in accordance with 40 C.F.R. Part 280, subpart F, the guarantor upon written instructions from the [director] shall fund a standby trust fund in accordance with the provisions of 40 C.F.R. Part 280.112, in an amount not to exceed the coverage limits specified above.

If [owner or operator] fails to satisfy a judgment or award based on a determination of liability for bodily injury or property damage to third parties caused by ["sudden" and/or "nonsudden"] accidental releases arising from the operation of the above-identified tank(s), or fails to pay an amount agreed to in settlement of a claim arising from or alleged to arise from such injury or damage, the guarantor, upon written instructions from the [director], shall fund a standby trust in accordance with the provisions of 40 C.F.R. Part 280.112 to satisfy such judgment(s), award(s), or settlement agreement(s) up to the limits of coverage specified above.

(iv) Guarantor agrees to notify [owner or operator] by certified mail of a voluntary or involuntary proceeding under title 11 (bankruptcy), U.S. Code naming guarantor as debtor, within 10 days after commencement of the proceeding.

(v) Guarantor agrees to remain bound under this guarantee notwithstanding any modification or alteration of any obligation of [owner or operator] pursuant to 40 C.F.R. Part 280.

(vii) The guarantor's obligation does not apply to any of the following:

(A) Any obligation of [local government owner or operator] under a workers compensation, disability benefits, or unemployment compensation law or other similar law;

(B) Bodily injury to an employee of [insert: local government owner or operator] arising from, and in the course of, employment by [insert: local government owner or operator];

(C) Bodily injury or property damage arising from the ownership, maintenance, use, or entrustment to others of any aircraft, motor vehicle, or watercraft;

(D) Property damage to any property owned, rented, loaned to, in the care, custody, or control of, or occupied by [insert: local government owner or operator] that is not the direct result of a release from a petroleum underground storage tank;

(E) Bodily damage or property damage for which [insert: owner or operator] is obligated to pay damages by reason of the assumption of liability in a contract or agreement other than a contract or agreement entered into to meet the requirements of 40 C.F.R. Part 280.93.

(viii) Guarantor expressly waives notice of acceptance of this guarantee by [the implementing agency], by any or all third parties, or by [local government owner or operator],

I hereby certify that the wording of this guarantee is identical to the wording specified in 40 C.F.R. Part 280.106(d) as such regulations were constituted on the effective date shown immediately below.

Effective Date: ________________________________________________

[Name of guarantor]

[Authorized signature for guarantor]

[Name of person signing]

[Title of person signing]

Signature of witness or notary:

If the guarantor is a local government, the local government guarantee with standby trust must be worded exactly as follows, except that instructions in brackets are to be replaced with relevant information and the brackets deleted:

(2) Local government guarantee with standby trust made by a local government.

Guarantee made this [date] by [name of guaranteeing entity], a local government organized under the laws of [name of state], herein referred to as guarantor, to [the state implementing agency] and to any and all third parties, and obliges, on behalf of [local government owner or operator].

Recitals

(i) Guarantor meets or exceeds [select 1: the local bond rating test requirements of 40 C.F.R. Part 280.104, the local government financial test requirements of 40 C.F.R. Part 280.105, or the local government fund under 40 C.F.R. Part 280.107(a), (b), or (c)].

(ii) [Local government owner or operator] owns or operates the following underground storage tank(s) covered by this guarantee: [list the number of tanks at each facility and the name(s) and address(es) of the facility(ies) where the tanks are located. If more than 1 instrument is used to assure different tanks at any 1 facility, for each tank covered by this instrument, list the tank identification number provided in the notification submitted pursuant to 40 C.F.R. Part 280 or the corresponding state requirement, and the name and address of the facility.] This guarantee satisfies 40 C.F.R. Part 280, subpart H, requirements for assuring funding for [insert: "taking corrective action" and/or "compensating third parties for bodily injury and property damage caused by" either "sudden accidental releases" or "nonsudden accidental releases" or "accidental releases"; if coverage is different for different tanks or locations, indicate the type of coverage applicable to each tank or location] arising from operating the above-identified underground storage tank(s) in the amount of [insert dollar amount] per occurrence and [insert: dollar amount] annual aggregate.

(iii) Incident to our substantial governmental relationship with [local government owner or operator], guarantor guarantees to [implementing agency] and to any and all third parties that:

In the event that [local government owner or operator] fails to provide alternative coverage within 60 days after receipt of a notice of cancellation of this guarantee and the [director of the implementing agency] has determined or suspects that a release has occurred at an underground storage tank covered by this guarantee, the guarantor, upon instructions from the [director] shall fund a standby trust fund in accordance with the provisions of 40 C.F.R. Part 280.112, in an amount not to exceed the coverage limits specified above.

If [owner or operator] fails to satisfy a judgment or award based on a determination of liability for bodily injury or property damage to third parties caused by ["sudden" and/or "nonsudden"] accidental releases arising from the operation of the above identified tank(s), or fails to pay an amount agreed to in settlement of a claim arising from or alleged to arise from such injury or damage, the guarantor, upon written instructions from the [director], shall fund a standby trust in accordance with the provisions of 40 C.F.R. Part 280.112 to satisfy such judgment(s), award(s), or settlement agreement(s) up to the limits of coverage specified above.

(iv) Guarantor agrees that, if at the end of any fiscal year before cancellation of this guarantee, the guarantor fails to meet or exceed the requirements of the financial responsibility mechanism specified in paragraph (i) of this subdivision, guarantor shall send within 120 days of such failure, by certified mail, notice to [local government owner or operator], as evidenced by the return receipt.

(v) Guarantor agrees to notify [owner or operator], by certified mail of a voluntary or involuntary proceeding under title 11 {bankruptcy}, U.S. Code naming guarantor as debtor, within 10 days after commencement of the proceeding.

(vi) Guarantor agrees to remain bound under this guarantee notwithstanding any modification or alteration of any obligation of [owner or operator] pursuant to 40 C.F.R. Part 280.

(viii) The guarantor's obligation does not apply to any of the following:

(A) Any obligation of [local government owner or operator] under a workers' compensation, disability benefits, or unemployment compensation law or other similar law;

(B) Bodily injury to an employee of [insert: local government owner or operator] arising from, and in the course of, employment by [insert: local government owner or operator];

(C) Bodily injury or property damage arising from the ownership, maintenance, use, or entrustment to others of any aircraft, motor vehicle, or watercraft;

(ix) Guarantor expressly waives notice of acceptance of this guarantee by [the implementing agency], by any or all third parties, or by [local government owner or operator].

Effective date: ______________________________

[Name of guarantor]

[Authorized signature for guarantor]

[Name of person signing]

[Title of person signing]

Signature of witness or notary

(e) If the guarantor is a state, the local government guarantee without standby trust shall be worded as specified in subdivision (1) of this subsection, except that instructions in brackets are to be replaced with relevant information and the brackets deleted. If the guarantor is a local government, the local government guarantee without standby trust shall be worded as specified in subdivision (2) of this subsection, except that instructions in brackets are to be replaced with relevant information and the brackets deleted. Subdivisions (1) and (2) of this subsection read as follows:

(1) Local government guarantee without standby trust made by a state.

Guarantee made this [date] by [name of state], herein referred to as guarantor, to [the state implementing agency] and to any and all third parties, and obliges, on behalf of [local government owner or operator].

Recitals

(i) Guarantor is a state.

(ii) [Local government owner or operator] owns or operates the following underground storage tank(s) covered by this guarantee: [list the number of tanks at each facility and the name(s) and address(es) of the facility(ies) where the tanks are located. If more than 1 instrument is used to assure different tanks at any 1 facility, for each tank covered by this instrument, list the tank identification number provided in the notification submitted pursuant to 40 C.F.R. Part 280 or the corresponding state requirement, and the name and address of the facility.] This guarantee satisfies 40 C.F.R. Part 280, subpart H, requirements for assuring funding for [insert: "taking corrective action" and/or "compensating third parties for bodily injury and property damage caused by" either "sudden accidental releases" or "nonsudden accidental releases" or "accidental releases"; if coverage is different for different tanks or locations, indicate the type of coverage applicable to each tank or location] arising from operating the above identified underground storage tank(s) in the amount of [insert: dollar amount] per occurrence and [insert: dollar amount] annual aggregate.

(iii) Guarantor guarantees to [implementing agency] and to any and all third parties and obliges that:

In the event that [local government owner or operator] fails to provide alternative coverage within 60 days after receipt of a notice of cancellation of this guarantee and the [director of the implementing agency] has determined or suspects that a release has occurred at an underground storage tank covered by this guarantee, the guarantor, upon written instructions from the [director] shall make funds available to pay for corrective actions and compensate third parties for bodily injury and property damage in an amount not to exceed the coverage limits specified above.

In the event that the [director] determines that [local government owner or operator] has failed to perform corrective action for releases arising out of the operation of the above identified tank(s) in accordance with 40 C.F.R. Part 280, subpart F, the guarantor upon written instructions from the [director] shall make funds available to pay for corrective actions in an amount not to exceed the coverage limits specified above.

If [owner or operator] fails to satisfy a judgment or award based on a determination of liability for bodily injury or property damage to third parties caused by ["sudden" and/or "nonsudden"] accidental releases arising from the operation of the above identified tank(s), or fails to pay an amount agreed to in settlement of a claim arising from or alleged to arise from such injury or damage, the guarantor, upon written instructions from the [director], shall make funds available to compensate third parties for bodily injury and property damage in an amount not to exceed the coverage limits specified above.

(iv) Guarantor agrees to notify [owner or operator] by certified mail of a voluntary or involuntary proceeding under title 11 {bankruptcy}, U.S. Code naming guarantor as debtor, within 10 days after commencement of the proceeding.

(v) Guarantor agrees to remain bound under this guarantee notwithstanding any modification or alteration of any obligation of [owner or operator] pursuant to 40 C.F.R. part 280.

(vi) Guarantor agrees to remain bound under this guarantee for so long as [local government owner or operator] must comply with the applicable financial responsibility requirements of 40 C.F.R. Part 280, subpart H, for the above identified tank(s), except that guarantor may cancel this guarantee by sending notice by certified mail to [owner or operator], such cancellation to become effective no earlier than 120 days after receipt of such notice by [owner or operator], as evidenced by the return receipt. If notified of a probable release, the guarantor agrees to remain bound to the terms of this guarantee for all charges arising from the release, up to the coverage limits specified above, notwithstanding the cancellation of the guarantee with respect to future releases.

(vii) The guarantor's obligation does not apply to any of the following:

(A) Any obligation of [local government owner or operator] under a workers' compensation disability benefits, or unemployment compensation law or other similar law;

(B) Bodily injury to an employee of [insert local government owner or operator] arising from, and in the course of, employment by [insert: local government owner or operator];

(C) Bodily injury or property damage arising from the ownership, maintenance, use, or entrustment to others of any aircraft, motor vehicle, or watercraft;

(viii) Guarantor expressly waives notice of acceptance of this guarantee by [the implementing agency], by any or all third parties, or by [local government owner or operator].

I hereby certify that the wording of this guarantee is identical to the wording specified in 40 C.F.R. part 280.106(e) as such regulations were constituted on the effective date shown immediately below.

Effective date: _______________________

[Name of guarantor]

[Authorized signature for guarantor]

[Name of person signing]

[Title of person signing]

Signature of witness or notary:

If the guarantor is a local government, the local government guarantee without standby trust must be worded exactly as follows, except that instructions in brackets are to be replaced with relevant information and the brackets deleted:

(2) Local government guarantee without standby trust made by a local government.

Recitals

(i) Guarantor meets or exceeds [select 1: the local government bond rating test requirements of 40 C.F.R. Part 280.104, the local government financial test requirements of 40 C.F.R. Part 280.105, the local government fund under 40 C.F.R. Parts 280.107(a), (b), or (c)].

(ii) [Local government owner or operator] owns or operates the following underground storage tank(s) covered by this guarantee: [list the number of tanks at each facility and the name(s) and address(es) of the facility(ies) where the tanks are located. If more than 1 instrument is used to assure different tanks at any 1 facility, for each tank covered by this instrument, list the tank identification number provided in the notification submitted pursuant to 40 C.F.R. Part 280 or the corresponding state requirement, and the name and address of the facility.] This guarantee satisfies 40 C.F.R. Part 280, subpart H, requirements for assuring funding for [insert: "taking corrective action" and/or "compensating third parties for bodily injury and property damage caused by" either "sudden accidental releases" or "nonsudden accidental releases" or "accidental releases"; if coverage is different for different tanks or locations, indicate the type of coverage applicable to each tank or location] arising from operating the above identified underground storage tank(s) in the amount of [insert: dollar amount] per occurrence and [insert: dollar amount] annual aggregate.

(iii) Incident to our substantial governmental relationship with [local government owner or operator], guarantor guarantees to [implementing agency] and to any and all third parties and obliges that:

In the event that [local government owner or operator] fails to provide alternative coverage within 60 days after receipt of a notice of cancellation of this guarantee and the [director of the implementing agency] has determined or suspects that a release has occurred at an underground storage tank covered by this guarantee, the guarantor, upon written instructions from the [director] shall make funds available to pay for corrective actions and compensate third parties for bodily injury and property damage in an amount not to exceed the coverage limits specified above.

In the event that the [director] determines that [local government owner or operator] has failed to perform corrective action for releases arising out of the operation of the above identified tank(s) in accordance with 40 C.F.R. Part 280, subpart F, the guarantor upon written instructions from the [director] shall make funds available to pay for corrective actions in an amount not to exceed the coverage limits specified above.

If [owner or operator] fails to satisfy a judgment or award based on a determination of liability for bodily injury or property damage to third parties caused by ["sudden" and/or "nonsudden"] accidental releases arising from the operation of the above identified tank(s), or fails to pay an amount agreed to in settlement of a claim arising from or alleged to arise from such injury or damage, the guarantor, upon written instructions from the [director], shall make funds available to compensate third parties for bodily injury and property damage in an amount not to exceed the coverage limits specified above.

(iv) Guarantor agrees that if at the end of any fiscal year before cancellation of this guarantee, the guarantor fails to meet or exceed the requirements of the financial responsibility mechanism specified in paragraph (i) of this subdivision, guarantor shall send within 120 days of such failure, by certified mail, notice to [local government owner or operator], as evidenced by the return receipt.

(v) Guarantor agrees to notify [owner or operator] by certified mail of a voluntary or involuntary proceeding under title 11 {bankruptcy}, U.S. Code naming guarantor as debtor, within 10 days after commencement of the proceeding.

(vi) Guarantor agrees to remain bound under this guarantee notwithstanding any modification or alteration of any obligation of [owner or operator] pursuant to 40 C.F.R. Part 280.

(vii) Guarantor agrees to remain bound under this guarantee for so long as [local government owner or operator] must comply with the applicable financial responsibility requirements of 40 C.F.R. Part 280, subpart H, for the above identified tank(s), except that guarantor may cancel this guarantee by sending notice by certified mail to [owner or operator], such cancellation to become effective no earlier than 120 days after receipt of such notice by [owner or operator], as evidenced by the return receipt. If notified of a probable release, the guarantor agrees to remain bound to the terms of this guarantee for all charges arising from the release, up to the coverage limits specified above, notwithstanding the cancellation of the guarantee with respect to future releases.

(viii) The guarantor's obligation does not apply to any of the following:

(A) Any obligation of [local government owner or operator] under a workers' compensation disability benefits, or unemployment compensation law or other similar law;

(B) Bodily injury to an employee of [insert: local government owner or operator] arising from, and in the course of, employment by [insert: local government owner or operator];

(C) Bodily injury or property damage arising from the ownership, maintenance, use, or entrustment to others of any aircraft, motor vehicle, or watercraft;

(ix) Guarantor expressly waives notice of acceptance of this guarantee by [the implementing agency], by any or all third parties, or by [local government owner or operator].

I hereby certify that the wording of this guarantee is identical to the wording specified in 40 C.F.R. Part 280.106(e) as such regulations were constituted on the effective date shown immediately below.

Effective date: _________________________________

[Name of guarantor]

[Authorized signature for guarantor]

[Name of person signing]

[Title of person signing]

Signature of witness or notary:

Mich. Admin. Code R. 29.2167

1998-2000 AACS; 2018 MR 21, Eff. 11/14/2018