BILL NUMBER: AB 715 CHAPTERED
BILL TEXT
CHAPTER 978
FILED WITH SECRETARY OF STATE SEPTEMBER 30, 1998
APPROVED BY GOVERNOR SEPTEMBER 29, 1998
PASSED THE ASSEMBLY AUGUST 28, 1998
PASSED THE SENATE AUGUST 27, 1998
AMENDED IN SENATE AUGUST 26, 1998
AMENDED IN SENATE AUGUST 18, 1998
AMENDED IN SENATE JULY 27, 1998
AMENDED IN SENATE JULY 6, 1998
AMENDED IN SENATE JULY 9, 1997
AMENDED IN SENATE JUNE 11, 1997
AMENDED IN ASSEMBLY APRIL 16, 1997
INTRODUCED BY Assembly Member Figueroa
FEBRUARY 26, 1997
An act to amend Section 43601 of the Public Resources Code,
relating to solid waste.
LEGISLATIVE COUNSEL'S DIGEST
AB 715, Figueroa. Solid waste facilities: closure: financial
ability.
Existing law requires any person owning or operating a solid waste
landfill, as defined, who submits a closure plan and postclosure
maintenance plan to the California Integrated Waste Management Board,
to also submit to the board evidence of financial ability to provide
for the cost of closure and postclosure maintenance, in an amount
that is equal to the estimated cost of closure and 15 years of
postclosure maintenance, contained in the closure plan and the
postclosure maintenance plan submitted.
This bill would provide that if the evidence of financial ability
for closure, postclosure, or corrective action is demonstrated by the
use of insurance, the board may approve the use of insurance if it
meets specified criteria.
The bill would permit the board to require a solid waste facility
operator using or proposing to use an insurance company to
demonstrate financial assurance to pay a fee for the actual and
necessary cost of reviewing information submitted by the operator not
to exceed $10,000, unless a higher amount is mutually agreed to by
the operator and the board.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 43601 of the Public Resources Code is amended
to read:
43601. (a) The evidence of financial ability shall be sufficient
to meet the closure and postclosure maintenance costs when needed.
(b) The owner or operator of a solid waste landfill shall provide
evidence of financial ability through the use of any of the
mechanisms set forth in Part 258 (commencing with Section 258.1) of
Title 40 of the Code of Federal Regulations or through the use of any
other mechanisms approved by the board. However, the board may
adopt regulations that reasonably condition the use of one or more of
those mechanisms to ensure adequate protection of public health and
safety and the environment, but shall not exclude the use of any
mechanism permitted under federal law. In addition, the evidence of
financial ability submitted pursuant to Section 43600 shall provide
that funds shall be available to the regional water boards upon the
issuance of any order under Chapter 5 (commencing with Section 13300)
of Division 7 of the Water Code to implement closure and postclosure
activities.
(c) The state water board or the appropriate regional water board
shall have access to the financial assurance funds for closure and
postclosure activities, and to financial assurance funds for
corrective action, as necessary, to address water quality problems,
if the owner or operator of the solid waste landfill has failed to
implement the required closure and postclosure activities or
corrective action activities.
(d) The owner or operator may request disbursement for
expenditures to conduct closure, postclosure maintenance, or
corrective actions from the financial assurance mechanism established
for that activity. Requests for disbursement shall be granted by
the board only if sufficient funds are remaining in the financial
assurance mechanism to cover the remaining approved total costs of
closure, postclosure maintenance, or corrective actions, as
appropriate.
(e) If the evidence of financial ability for closure, postclosure,
or corrective action is demonstrated by use of insurance, the board
may approve the insurance mechanism if it is in compliance with
either paragraph (1) or (2) as follows:
(1) The issuer of the insurance policy is either:
(A) Licensed by the Department of Insurance to transact the
business of insurance in the State of California as an admitted
carrier.
(B) Eligible to provide insurance as an excess and surplus lines
insurer in California through a surplus lines broker currently
licensed under the regulations of the Department of Insurance and
upon the terms and conditions prescribed by the Department of
Insurance.
(2) If the insurance carrier is established by a solid waste
facility operator to meet the financial assurance obligations of that
operator, insurance may be approved by the board that meets all of
the following requirements:
(A) The insurance mechanism is in full compliance with the
requirements for insurance that are specified in subdivision (d) of
Section 258.74 of Title 40 of the Code of Federal Regulations.
(B) The insurance carrier is an insurer domiciled in the United
States and licensed in its state of domicile to write that insurance.
(C) The insurance carrier only provides financial assurance to the
operator that has established the insurance carrier as a form of
self-insurance and does not engage in the business of marketing,
brokering, or providing insurance coverage to other parties.
(D) The insurance carrier shall maintain a rating of A- or better
by A.M. Best, or other equivalent rating by any other agency
acceptable to the board.
(E) If requested by the board, an independent financial audit
report evaluating the assets and liabilities of the insurance carrier
and confirming compliance with the statutory and regulatory
requirements of the state of domicile and an independent actuarial
opinion on the independence and financial soundness of the insurance
carrier by an actuary in good standing with the Casualty Actuarial
Society or the American Academy of Actuaries regarding the adequacy
of the loss reserves maintained by the insurance carrier shall be
submitted to the board upon application and annually thereafter.
(f) A solid waste facility operator using or proposing to use an
insurance company to demonstrate financial assurance may be required
by the board to pay a fee for the actual and necessary cost of
reviewing information submitted by the operator pursuant to paragraph
(2) of subdivision (e) up to an amount not to exceed ten thousand
dollars ($10,000), unless a higher amount is mutually agreed to by
the operator and the board.
(g) The funds collected pursuant to subdivision (f) shall be
deposited in the Integrated Waste Management Account and shall be
available, upon appropriation by the Legislature, for expenditure by
the board to fund the review specified in subdivision (f).