Subchapter D. BONDING
Sec.
263a.32. Bonding.§ 263a.32. Bonding.
(a) A collateral bond means an indemnity agreement in a certain sum payable to the Department executed by the licensee and which is supported by the deposit with the Department of cash, negotiable bonds of the United States of America, the Commonwealth of Pennsylvania, the Turnpike Commission, the General State Authority, the State Public School Building Authority or a Commonwealth municipality, or an irrevocable letter of credit of any bank organized or authorized to transact business in the United States.
(b) A new, revised or renewed license to transport hazardous waste may not be issued by the Department before the applicant for a license has filed a collateral bond payable to the Department on a form provided or approved by the Department, and the bond is approved by the Department.
(c) The bond shall be in an amount sufficient to assure that the licensee faithfully performs the requirements of the act, the regulations promulgated thereunder, the terms and conditions of the license and any Department order issued to the licensee, but a minimum of $10,000.
(d) Liability under the bond shall continue at a minimum for the duration of the license, any renewal thereof and for a period of 1 year after expiration, termination, revocation or surrender of the license. The 1-year extended period of liability shall include, and shall be automatically extended for, additional time during which administrative or legal proceedings are pending involving a violation by the transporter of the act, regulations promulgated thereunder, the terms or conditions of a license or a Department order.
(e) The Department may require additional bond amounts at any time if the methods of transporting wastes change, the kinds of wastes transported change or the Department determines the additional bond amounts are necessary to guarantee compliance with the act, regulations, the terms and conditions of the license or a Department order.
(f) Collateral bonds are subject to the following conditions:
(1) The Department will obtain possession of and keep in custody all collateral deposited by the licensee until authorized for release as provided in this section.
(2) The Department will value collateral at its current market value.
(3) Collateral shall be in the name of the licensee, not in the name of third parties and shall be pledged and assigned to the Department free and clear of claims.
(g) Letters of credit are subject to the following conditions:
(1) The letter may only be issued by a bank organized or authorized to do business in the United States.
(2) Letters of credit are irrevocable. The Department may accept a letter of credit not revocable for a term of 3 years if:
(i) The letter of credit is automatically renewable for additional terms, unless the bank gives at least 90 days prior written notice to the Department of its intent to terminate the credit at the end of the current term.
(ii) The Department has the right to draw upon the credit before the end of its term and convert it into a cash collateral bond if the licensee fails to replace the letter of credit with other acceptable collateral within 30 days of the bank’s notice to terminate the credit.
(3) The letter of credit shall be payable to the Department in part or in full upon demand of the Department in the case of a forfeiture or the failure of the owner or operator to replace the letter of credit as provided in this section.
(4) The Department will not accept letters of credit from a bank for a licensee in excess of 10% of the bank’s capital surplus account as shown on a balance sheet certified by a certified public accountant.
(5) Letters of credit are subject to the Uniform Customs and Practice for Documentary Credits, International Chamber of Commerce Publication No. 290, including amendments and successor publications.
(6) Letters of credit provide that the bank will give prompt notice to the licensee and the Department of a notice received or action filed alleging the insolvency or bankruptcy of the bank or alleging violations of regulatory requirements that could result in suspension or revocation of the bank’s charter or license to do business.
(h) Upon the incapacity of a bank by reason of bankruptcy, insolvency or suspension or revocation of its charter or license, the licensee is deemed to be without collateral bond coverage in violation of § 263a.13 (relating to licensing). The Department will issue a notice of violation against a licensee who is without bond coverage. The notice shall specify a reasonable period to replace bond coverage, not to exceed 90 days.
(i) Bonds not declared forfeit in accordance with subsection (j) are released to the licensee 1 year after expiration, termination, revocation or surrender of the license.
(j) The Department will declare forfeit all a licensee’s bonds if the Department finds that the licensee violated any requirements of the act, this article, terms and conditions of a license or a Department order issued to the licensee when the Department finds that the licensee failed to remedy a violation promptly.
(k) Remedies provided in law for violation of the act, this article or the conditions of the license, are expressly preserved. Nothing in this section may be construed as an exclusive penalty or remedy for the violations of law. An action taken under this chapter does not waive or impair another remedy or penalty provided in law.
Cross References This section cited in 25 Pa. Code § 263a.13 (relating to licensing); and 25 Pa. Code § 287.102 (relating to permit-by-rule).
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