15.20.05.08

.08 Bond or Security.

A. The broker or alternative use participant shall file with the Department a bond, or other security, on a form satisfactory to the Department. The bond shall be payable to the Department, and the obligation of the bond shall be conditioned upon fulfilling the cost-share agreement and manure stockpiling and storage requirements provided in this chapter.

B. The Department may waive the bonding and security requirements for a participant if the participant:

(1) Stockpiles 500 tons of manure or less; and

(2) Has contingent plans to relocate the manure, which are provided and acceptable to the Department.

C. An acceptable security or bond is limited to:

(1) A bond in a form satisfactory to the Department and underwritten by a surety company authorized to do business in this State;

(2) A bank certified check, bank cashier's check, or bank treasurer's check equal to the required bond amount;

(3) Pledges of securities backed by the full faith and credit of the United States Government, or bonds issued by the State, having a market value equal to the required bond amount; or

(4) An irrevocable letter of credit that is:

(a) In a form satisfactory to the Department,

(b) Issued by a financial institution approved by the State,

(c) Equivalent to the required bond, and

(d) Guaranteed to be available and payable directly to the State on demand, in the event of forfeiture.

D. The bond liability required under this regulation shall terminate 2 years after the:

(1) Participation in the project ceases;

(2) Stockpiling or storing manure ceases; or

(3) Bond is canceled.

E. The bond amount shall be the estimated cost of remediation if, in the event of forfeiture:

(1) Manure must be removed from the stockpile site;

(2) Manure must be protected from rainfall, runoff, or leaching, until such time that it can be removed from the stockpile or storage site because of failure to stockpile it in a manner approved by the Department; or

(3) The stockpile or storage site must be cleaned up or reclaimed because of failure to stockpile or store the manure in a manner approved by the Department, or as otherwise required under this chapter.

F. The bond amount shall be based on, but not limited to, the quantity of manure stockpiled or stored.

G. The obligation of the broker, alternative use participant, and any corporate surety under the bond shall become due and payable, and all or any part of any cash or securities shall be applied to payment of the costs of remediation, including, but not limited to, stabilizing, protecting, and removing the manure, and cleaning up or reclaiming the storage site, if the Department has:

(1) Notified the broker or alternative use participant and any corporate surety that the requirements imposed under this chapter for stockpiling or storing manure have not been fulfilled, and specified in the notice the particular deficiencies;

(2) Given the broker or alternative use participant and any corporate surety a reasonable opportunity to correct the deficiencies; and

(3) Determined that, at the end of a reasonable length of time, some or all of the deficiencies specified remain uncorrected.