(a) Self bonding: - (i) Initial application to self bond: Initial application to self bond shall be made at the time the operator makes written application to the director to construct, operate or modify a regulated facility. The application shall be on forms furnished by the director and shall contain:
- (A) Identification of operator by:
- (I) For corporations, name, address, telephone number, state of incorporation, principal place of business and name, title and authority of person signing application, a corporate resolution authorizing the application, and statement of authority to do business in the State of Wyoming, or
- (II) For all other forms of business enterprises, name, address and telephone number and statement of how the enterprise is organized, law of the state under which it is formed, place of business, and relationship and authority of the person signing the application.
- (B) Amount of bond required, to be determined in accordance with W.S. 35-11-504(a)(i) or W.S. W.S. 35-11-306(d). If the self bond amount is proposed to be less than the full bond amount, the amount which is proposed to be under a self bond is the bond required.
- (C) Type of operation and anticipated dates performance is to be commenced and completed.
- (D) Brief chronological history of business operations conducted within the last five (5) years which would illustrate a continuous operation for five (5) years immediately preceding the time of application.
- (I) The director may allow a joint venture or partnership with less than five (5) years of continuous operation to qualify under this requirement, if each member of the joint venture or partnership has been in continuous operation for at least five (5) years immediately preceding the time of application.
- (II) When calculating the period of continuous operation, the director may exclude past periods of interruption to the operation of the business entity that were beyond the applicant's control and that do not affect the applicant's likelihood of remaining in business during the proposed operation of the regulated facility.
- (E) Information in sufficient detail to show good faith performance of past operation and closure/post-closure obligations.
- (F) A statement, in detail, to show a history of financial solvency. For an initial bond, each operator must provide audited financial statements supporting the following comparative documents, prepared and certified by an independent Certified Public Accountant who, by reason of education, experience or special training, and disinterest, is competent to analyze and interpret the operator's financial solvency. All statements shall be prepared following generally accepted principles of accounting.
- (I) A comparative balance sheet which shows assets, liabilities and owner equity for five (5) years. The operator may provide common-size documents for confidentiality.
- (II) A comparative income statement which shows all revenues and expenses for five (5) years. The operator may provide common-size documents for confidentiality.
- (III) A report for the most recently completed fiscal year containing the accountant's audit opinion or review opinion of the balance sheet and income statement with no adverse opinion.
- (IV) Notwithstanding the language in (F) above, unaudited financial statements may be submitted to support the comparative documents where current fiscal year quarters have ended but a CPA opinion has not yet been obtained because the fiscal year has not yet ended.
- (G) Financial information in sufficient detail to show that the operator meets one of the following criteria (the specific criterion relied upon shall be identified).
- (I) The operator has a rating for all bond issuance actions over the past five (5) years of "A" or higher as issued by either Moody's Investor Service or Standard and Poor's Corporation (the rating service should be identified together with any further breakdown of specific ratings);
- (II) The operator has a tangible net worth of at least $10 million, and a ratio of total liabilities to net worth of 2.5 times or less, and a ratio of current assets to current liabilities of 1.2 times or greater. The two ratio requirements must be met for the past year, and documented for the four (4) years preceding the past year. Explanations should be included for any year where the ratios fall below the stated limits.
- (III) The operator's fixed assets in the United States total at least $20 million, and the operator has a ratio of total liabilities to net worth of 2.5 times or less, and a ratio of current assets to current liabilities of 1.2 times or greater. The two ratio requirements must be met for the past year and documented for the four (4) years preceding the past year. Explanations should be included for any year where the ratios fall below the stated limits.
- (IV) If the operator chooses (II) or (III), the two ratios shall be calculated with the proposed self bond amount added to the current or total liabilities for the current year. The operator may deduct the costs currently accrued for reclamation which appear on the balance sheet.
- (H) A statement listing any notices issued by the Securities and Exchange Commission or proceedings initiated by any party alleging a failure to comply with any public disclosure or reporting requirements under the securities laws of the United States. Such statement shall include a summary of each such allegation, including the date, the requirement alleged to be violated, the party making the allegation, and the disposition or current status thereof.
- (I) A statement which:
- (I) Identifies by name, address and telephone number, a registered office which may be but need not be, the same as the operator's place of business,
- (II) Identifies by name, address and telephone number, a registered agent, which agent must be either an individual resident in this state, whose business office is identical with such registered office, or a domestic corporation, or a foreign corporation authorized to transact business in the state, having a business office identical with such registered office. The registered agent so appointed by the operator shall be an agent to such operator upon whom any process, notice or demand required or permitted by law to be served upon the operator may be served.
- (III) Acknowledges that if the operator fails to appoint or maintain a registered agent in this state, or whenever any such registered agent cannot be reasonably found at the registered office, then the Wyoming Secretary of State shall be an agent for such operator upon whom any process, notice or demand may be served. In the event of any such process, the Wyoming Secretary of State shall immediately cause one copy of such process, notice or demand to be forwarded, by registered or certified mail, to the operator at his principle place of business. The Wyoming Secretary of State shall keep a record of all processes, notices, or demands served upon him under this paragraph, and shall record therein the time of such service and his action with reference thereto.
- (IV) Acknowledges that should the operator change the registered office or registered agent, or both, a statement indicating such change shall be filed immediately with the Solid and Hazardous Waste Division.
- (V) Acknowledges that nothing herein contained shall limit or affect the right to serve any process, notice or demand required or permitted by law to be served upon an operator in any other manner now or hereafter permitted by law.
- (J) The director may accept a written guarantee for an operator's self bond from a parent corporation guarantor or from a federal agency, if the guarantor or federal agency satisfies the financial criteria of this chapter as if it were the operator. The operator must only supply information addressing requirements not met by the parent corporation guarantor. The terms of the parent corporate or federal agency guarantee shall provide for the following:
- (I) If the operator fails to complete the closure/post-closure plan the guarantor shall do so or the guarantor shall be liable under the indemnity agreement to provide funds to the state sufficient to complete the reclamation plan, but not to exceed the bond amount.
- (II) The parent corporate or federal agency guarantee shall remain in force unless the guarantor sends notice of cancellation by registered or certified mail to the operator and to the director at least ninety (90) days in advance of the cancellation date, and the director accepts the cancellation. The cancellation shall be accepted by the director if the operator obtains a suitable replacement bond before the cancellation date, if the lands for which the self bond, or portion thereof, was accepted have not been disturbed, or if the lands have been released under W.S. W.S. 35-11-504.
- (K) For the director to accept a regulated facility operator's self bond, the total amount of the outstanding and proposed self bond of the operator shall not exceed 25 percent (25%) of the operator's tangible net worth in the United States. For the director to accept a corporate guarantee, the total amount of the parent corporation guarantor's present and proposed self bonds and guaranteed self bonds shall not exceed 25 percent (25%) of the guarantor's tangible net worth in the United States.
- (ii) Approval or denial of operator's self bond application:
- (A) The director, within sixty (60) days of the operator's submission of all materials necessary to base a decision on the application shall:
- (I) Approve or reject such application and declare in writing its reasons for such action to the operator or his registered agent. The decision shall be based on the information submitted and shall be sufficient to meet the demonstrations required by W.S. W.S. W.S. 35-11-504(a).
- (II) If a rejection is based on inadequate information or failure of the operator to supply all necessary material, the director shall allow the operator thirty (30) days to remedy the deficiencies. Such corrections shall be made to the satisfaction of the director. The director shall have an additional sixty (60) days to approve or reject the corrected application.
- (B) If the director accepts an uncollateralized self bond, an indemnity agreement shall be submitted subject to the following requirements:
- (I) The indemnity agreement shall be executed by all persons and parties who are to be bound by it, including the parent corporation or federal agency guarantor, and shall bind each jointly and severally.
- (II) Corporations applying for a self bond or parent corporation guaranteeing a subsidiary's self bond shall submit an indemnity agreement signed by two corporate officers who are authorized to bind the corporation. A copy of such authorization shall be provided to the director. A federal agency guaranteeing an operator's self bond shall submit an indemnity agreement signed by two officers of the agency who are authorized to bind the agency and a copy of their authorization. The agency shall also submit documents supporting the availability of a cause of action against the federal agency for performance under the indemnity agreement.
- (III) If the applicant is a partnership or joint venture, the agreement shall bind each partner or party who has a beneficial interest directly or indirectly, to the operator.
- (IV) The indemnity agreement shall provide that the persons or parties bound shall pay all litigation costs including reasonable attorney fees incurred by the state in any successful effort to enforce the agreement against the operator.
- (C) If the application is rejected based on the information required in Section 4(a)(i), or based on the limitation set in Section 4(a)(i)(K) then the operator may offer collateral and an indemnity agreement to support the self bond application. The indemnity agreement shall be subject to the requirements of (B) above.
- (I) For any collateral offered to support a self bond, the following information shall be provided.
- (1.) The value of the property. The property shall be valued at the difference between 75 percent (75%) of the fair market value and any reasonable expense anticipated by the director in selling the property. The fair market value shall be determined by an appraiser or appraisers appointed by the director and mutually acceptable to both the director and the operator. The appraisal shall be expeditiously made, and copies thereof furnished to the director and the operator. The expense of the appraisal shall be borne by the operator.
- (2.) A description of the property satisfactory for deposit to further assure that the operator shall faithfully perform all requirements of Act. The director shall have full discretion in accepting any such offer.
- a. Real property shall not include any lands in the process of being used for the transfer, treatment, processing, storage or disposal of solid wastes, reclaimed or subject to this application. The operator may offer any lands the bonds for which have been released or lands within a permit area which will not be affected. In addition, any land used as a security shall not be used for disposal, treatment, processing or storage while it is a security.
- b. Securities shall only include those which are United States government securities or those state government securities acceptable to the director. Securities shall meet the requirements specified in the definition of "Collateral" found in Chapter 1, Section 1(e).
- c. Personal property shall be in possession of the operator, shall be unencumbered, and shall not include:
- i. Property which is already being used as collateral, or
- ii. Goods which the operator sells in the ordinary course of his business, or
- iv. Certificates of deposit which are not federally insured or where the depository is unacceptable to the director.
- (3.) Evidence of ownership submitted in one of the following forms:
- a. If the property offered for deposit is real property, the operator's interest must be evidenced by:
- i. In the case of a federal or state lease, a status report prepared by an attorney, satisfactory to the director as disinterested and competent to so evaluate the asset, and an affidavit from the owner in fee establishing that the leasehold could be transferred upon default.
- ii. In the case of a fee simple interest, a title certificate or similar evidence of title and encumbrances prepared by an abstract office authorized to transact business within the state and satisfactory to the director.
- b. If the property offered for deposit is a security, the operator's interest must be evidenced by possession of the original or a notarized copy of the certificate or a certified statement of account from a brokerage house.
- c. If the property offered for deposit is personal property as defined in Chapter 1, Section 1(e)(i)(K), evidence of ownership shall be submitted in the form satisfactory to the director to establish unquestionable title to the property to the operator.
- (II) In addition to submitting the above information, if the operator offers personal property as collateral to support a self bond, he must meet the financial criteria contained in (1.) or (2.) following:
- (1.) The operator must have a tangible net worth of at least $10 million, a ratio of total liabilities to net worth of 3.0 times or less, and a ratio of current assets to current liabilities of 1.0 times or greater. The two ratios shall be calculated with the proposed self bond amount added to the current or total liabilities for the current year. The operator may deduct the costs currently accrued for reclamation which appear on the balance sheet.
- (2.) The operator must have fixed assets in the United States that total at least $20 million, a ratio of total liabilities to net worth of 3.0 times or less, and a ratio of current assets to current liabilities of 1.0 times or greater. The two ratios shall be calculated with the proposed self bond amount added to the current or total liabilities for the current year. The operator may deduct the costs currently accrued for closure/post-closure which appear on the balance sheet.
- (III) If the director accepts personal property as collateral to support a self bond, the director shall require:
- (1.) Quarterly maintenance reports prepared by the operator, and
- (2.) A perfected, first-lien security interest in the property used, in favor of the Wyoming Department of Environmental Quality. This security interest shall be perfected by filing a financial statement or taking possession of the collateral in accordance with (IV)(1.) below.
- (3.) In addition, the department may also require quarterly inspections of the personal property by a qualified representative of the department.
- (IV) If the director accepts any property as collateral to support a self bond, the director shall, as applicable, require possession by the director of the personal property, or a mortgage or security agreement executed by the operator in favor of the Department of Environmental Quality. The requirement shall be that which is sufficient to vest such interest in the property in the director to secure the right and power to sell or otherwise dispose of the property by public or private proceedings so as to insure reclamation of the affected lands in accordance with the act. Personal property collateral to support a self bond shall be secured under the provisions of the Uniform Commercial Code as required by (2.) below.
- (1.) Any mortgage shall be executed and duly recorded as required by law so as to be superior to all other liens, mortgages or encumbrances pertaining to the real property in question.
- (2.) Any security interest created by a security agreement shall be perfected by filing a financing statement or taking possession of the collateral in accordance with W.S. W.S. W.S. 34-21-950 through W.S. W.S. W.S. 34-21-955(1977). The director shall have all rights and duties set forth in W.S. W.S. W.S. 34-21-926(1977) when the collateral is in its possession as a secured party, as defined in W.S. W.S. W.S. 34-21-905(a)(ix). Any money received from the collateral during this period of time shall be remitted to the operator. When the collateral is left in the possession of the operator, the security agreement shall require that, upon default, the operator shall assemble the collateral and make it available to the director at a place to be designated by the director which is reasonably convenient to both parties.
- (V) The operator may, with written consent from the director, substitute for any of the property held hereunder other property upon submittal of all information required under this subsection and compliance with all requirements of this subsection so as to secure all obligations under all periods of time as they relate to disposal operations.
- (VI) For collateral posted to support a self bond, all persons with an interest in the collateral shall be notified by the operator of the posting, and of all other actions affecting the collateral.
- (iii) Renewal bonds:
- (A) Information for the renewal bond under the self bonding program which shall accompany the annual report shall include:
- (I) Amount of bond required, which shall be determined in accordance with W.S. W.S. W.S. 35-11-504. If the self bond amount is proposed to be less than the full bond amount, the amount which is proposed to be under a self bond is the bond required.
- (II) Financial information in sufficient detail to show that the guarantor still meets one of the criteria in Section 4(a)(i)(G), and the limitation in Section 4(a)(i)(K). The director requires financial statements for the most recently completed fiscal year together with an independent Certified Public Accountant's audit opinion or review opinion of the financial statements with no adverse opinion. Additional unaudited information may be required by the director.
- (III) If the director has accepted a mortgage, any evidence of change in value, title and possession of the property shall be submitted.
- (IV) If the director deems it necessary to revalue any asset, it may appoint the appraiser or appraisers mutually acceptable to the director and the operator. Any such reappraisal shall be expeditiously made, and copies thereof furnished to the director and the operator. The expense of the appraisal shall be borne by the operator. The findings of the appraisal shall be final and binding unless both parties agree to a reappraisal.
- (V) For regulated facility operators using personal property as collateral to support a self bond, the operator's current financial information showing continuing compliance with Section 4(a)(ii)(C)(II) of this chapter.
- (B) If the director has authorized a parent corporate guarantee, the parent corporation shall supply all information required under subsection (iii)(A)(II) of this section.
- (C) Any valid initial self bond shall carry the right of successive renewal as long as the above listed information is submitted which demonstrates that the guarantor remains qualified under W.S. W.S. 35-11-504.
- (iv) Substitution of the operator's self bond:
- (A) The director may require the operator to substitute a good and sufficient corporate surety licensed to do business in the state if the director determines in writing that the self bond of the operator fails to provide this protection consistent with the objectives and purposes of W.S. W.S. W.S. 35-11-504. The director shall require this substitution if the financial information submitted or requested under Section (4)(a)(ii)(A)(II) indicates that the operator no longer qualifies under the self bonding program. Substitution of an alternate bond shall be made within thirty (30) days. The operator may also request substitution. This request is contingent upon the operator meeting all the requirements of the bond provisions, W.S. W.S. W.S. 35-11-504. If these requirements are met, the director shall accept substitution.
- (B) If the operator fails within sixty (60) days to make a substitution for the revoked self bond with a corporate surety, cash, governmental securities, or federally insured certificates of deposit, or irrevocable letters of credit, the director shall suspend or revoke the permit until such substitution is made.
- (C) All methods of substitution shall be made in accordance with the bonding provisions in W.S. W.S. W.S. 35-11-504. The director shall either:
- (I) Require substitution of a good and sufficient corporate surety licensed to do business in the state that will stand as surety so as to cover all periods of time as they relate to disposal operations, or
- (II) Retain from the operator sufficient assets within the department so as to cover that period of time of the disposal operation which is not covered by the substituted surety. Those assets not retained shall be returned to the operator within sixty (60) days free from the department's encumbrances, liens, mortgages or security interests.
- (v) Requirements for forfeiture and release:
- (A) All requirements as to bond forfeiture proceedings and the release of bonds shall be consistent with W.S. W.S. W.S. 35-11-504, excepting the requirements as to notification to the surety. When the director has required a mortgage, and the bond has been forfeited, foreclosure procedures shall be in accordance with W.S. W.S. W.S. 34-4-101 through 34-4-113(1977).
- (B) For self bonds supported by collateral, upon bond release property return shall be of that form sufficient for the director to release that portion of the interest or mortgage commensurate with the amount of the bond released less any disposed of in accordance with the mortgage or indemnity agreement.
(b) Surety bonds: - (i) A corporate surety shall not be considered good and sufficient for purposes of W.S. W.S. W.S. 35-11-504 or unless:
- (A) It is licensed to do business in the state;
- (B) The estimated bond amount does not exceed the limit of risk as provided for in W.S. W.S. W.S. 26-5-110, nor raise the total of all bonds held by the applicant under that surety above three times the limit of risk;
- (C) The surety agrees:
- (I) Not to cancel bond, except as provided for in W.S. W.S. 35-11-504 or where the director gives prior written approval of a good and sufficient replacement surety with transfer of the liability that has accrued against the operator on the permit area;
- (II) To be jointly and severally liable with the permittee;
- (III) To provide immediate written notice to the director and operator once it becomes unable or may become unable due to any action filed against it to fulfill its obligations under the bond.
- (ii) The provisions applicable to cancellation of the surety's license in W.S. W.S. W.S. 35-11-504 shall also apply if for any other reason the surety becomes unable to fulfill its obligations under the bond. Upon such occurrence the operator shall provide the required notice. Failure to comply with this provision shall result in suspension of the permit.
(c) Federally insured certificate of deposit: The director shall not accept an individual certificate of deposit in an amount in excess of $100,000 or the maximum insurable amount as determined by the FDIC or the Federal Savings and Loan Insurance Corporation. Such certificates of deposit shall be made payable to the department both in writing and upon the records of the bank issuing these certificates. The director shall require the banks issuing these certificates to waive all rights of set off or liens against the certificates. The bond amount may be calculated to include any amount which would be deducted as a penalty for payment before maturity.
(d) Government-backed securities: In lieu of a bond, the operator or its principal may deposit government securities registered solely in the department's name and backed by the full faith and credit of the United States.
(e) Cash: In lieu of a bond, the operator or its principal may deposit cash in a bank account in the department's name.
(f) Letters of credit: - (i) Letters of credit shall be subject to the following conditions:
- (A) The letter shall be irrevocable during its term, which shall coincide with the annual bonding period. The director may approve the use of letters of credit as security in accordance with a schedule approved with the permit. Any bank issuing a letter of credit shall notify the director in writing at least ninety (90) days prior to the maturity date of such letter or the expiration of the letter of credit agreement. Letters of credit utilized as security in areas requiring continuous bond coverage shall be collected by the director if not replaced by other suitable evidence of financial responsibility at least thirty (30) days before the expiration date of the letter of credit agreement;
- (B) The letter must be payable to the department in part or in full upon demand and receipt from the director of a notice of forfeiture issued in accordance with W.S. W.S. W.S. 35-11-504;
- (C) The letter shall not be in excess of 10 percent (10%) of the bank's capital surplus account as shown on a balance sheet certified by a Certified Public Accountant;
- (D) The director shall only accept bank letters of credit issued in accordance with W.S. W.S. W.S. 13-3-402;
- (E) The letter of credit shall provide that:
- (I) The bank will give written notice within three (3) working days to the permittee and the director of any notice received or action filed alleging the insolvency or bankruptcy of the bank, or alleging any violations of regulatory requirements which could result in suspension or revocation of the bank's charter or license to do business,
- (II) In the event the bank becomes unable to fulfill its obligations under the letter of credit for any reason, written notice shall be given immediately to the permittee and the director, and
- (III) Upon the incapacity of a bank by reason of bankruptcy, insolvency, or suspension or revocation of its charter or license, the permittee shall be deemed to be without performance bond coverage in violation of the act. The director shall issue a notice of violation against any operator who is without bond coverage, specifying a reasonable period to replace bond coverage, not to exceed sixty (60) days. During this period the director or his or her designated representative shall conduct weekly inspections to ensure continuing compliance with other permit requirements, the regulations and the act. If the notice is not abated in accordance with the schedule, a cessation order shall be issued.
- (ii) Agent for service of process: The letter may only be issued by a bank organized to do business in the U.S. which identified by name, address, and telephone number an agent upon whom any process, notice or demand required or permitted by law to be served upon the bank may be served. Letters of credit from U.S. branches of foreign banks are not acceptable.
- (A) If the bank fails to appoint or maintain an agent in this state, or whenever any such agent cannot be reasonably found, then the Wyoming Secretary of State shall be an agent for such bank upon whom any process, notice or demand may be served for the purpose of this chapter. In the event of any such process, the Wyoming Secretary of State shall immediately cause one copy of such process, notice or demand to be forwarded, by certified or registered mail to the bank at its principle place of business. The Wyoming Secretary of State shall keep a record of all processes, notices, or demands served upon him or her under this paragraph, and shall record therein the time of such service and his or her action with reference thereto;
- (B) Nothing herein contained shall limit or affect the right to serve any process, notice or demand required or permitted by law to be served upon the bank in any other manner now or hereafter permitted by law.