Section 329IAC9-8-16. Local government guarantee

   (a) A local government owner or operator may satisfy the requirements of section 4 of this rule by obtaining a guarantee that conforms to this section. The guarantor must be a local government that has a substantial governmental relationship with the owner and operator and issues the guarantee as an act incident to that relationship. A local government that acts as the guarantor shall complete any of the following:

(1) Demonstrate that it meets the bond rating test requirement of section 14 of this rule and deliver a copy of the chief financial officer's letter as contained in section 14(d) of this rule to the local government owner or operator.

(2) Demonstrate that it meets the worksheet test requirements of section 15 of this rule and deliver a copy of the chief financial officer's letter as contained in section 15(c) of this rule to the local government owner or operator.

(3) Demonstrate that it meets the local government fund requirements of section 17(a)(1), 17(a)(2), or 17(a)(3) of this rule and deliver a copy of the chief financial officer's letter as contained in section 17 of this rule to the local government owner or operator.

  (b) If the local government guarantor is unable to demonstrate financial assurance under section 14, 15, 17(a)(1), 17(a)(2), or 17(a)(3) of this rule, at the end of the financial reporting year, the guarantor shall send by certified mail, before cancellation or nonrenewal of the guarantee, notice to the owner or operator. The guarantee must terminate no less than one hundred twenty (120) days after the date the owner or operator receives the notification as evidenced by the return receipt. The owner or operator shall obtain alternative coverage as specified in section 20(c) of this rule.

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

(1) If, in the default or incapacity of the owner or operator, the guarantor guarantees to fund a standby trust as directed by the commissioner, the guarantee must be worded as specified in subsection (d).

(2) If, in the default or incapacity of the owner or operator, the guarantor guarantees to make payments as directed by the commissioner for taking corrective action or compensating third parties for bodily injury and property damage, the guarantee must be worded as specified in subsection (e).

  (d) 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:

Local Government Guarantee with Standby

Trust Made by a Local Government

Guarantee made this [date] by [insert name of guaranteeing entity], a local government organized under the laws of [insert name of state], herein referred to as guarantor, to the Indiana Department of Environmental Management (IDEM) and to any and all third parties, and obligees, on behalf of [local government owner or operator].

Recitals

1. Guarantor meets or exceeds [select one: the local government bond rating test requirements of 329 IAC 9-8-14, the local government financial test requirements of 329 IAC 9-8-15, or the local government fund under 329 IAC 9-8-17(a)(1), 329 IAC 9-8-17(a)(2), or 329 IAC 9-8-17(a)(3)].

2. [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 one instrument is used to assure different tanks at any one facility, for each tank covered by this instrument, list the tank identification number provided in the notification submitted pursuant to 329 IAC 9-2-2, and the name and address of the facility.] This guarantee satisfies 329 IAC 9-8 requirements for assuring funding for [insert "taking corrective action" or "compensating third parties for bodily injury and property damage caused by" or "taking corrective action and 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.

3. Incident to our substantial governmental relationship with [local government owner or operator], guarantor guarantees to IDEM 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 IDEM commissioner has determined or suspects that a release has occurred at an underground storage tank covered by this guarantee, the guarantor, upon instructions from the IDEM commissioner, shall fund a standby trust fund in accordance with the provisions of 329 IAC 9-8-22 in an amount not to exceed the coverage limits specified above.

In the event that the IDEM commissioner 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 329 IAC 9-5, the guarantor, upon written instructions from the IDEM commissioner, shall fund a standby trust fund in accordance with the provisions of 329 IAC 9-8-22 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 [insert "sudden" or "nonsudden" or both] 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 IDEM commissioner, shall fund a standby trust in accordance with the provisions of 329 IAC 9-8-22 to satisfy such judgment(s), award(s), or settlement agreement(s) up to the limits of coverage specified above.

4. 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 (1), guarantor shall send within one hundred twenty (120) days of such failure, by certified mail, notice to [local government owner or operator] as evidenced by the return receipt.

5. Guarantor agrees to notify [owner or operator] by certified mail of a voluntary or involuntary proceeding under the bankruptcy laws of the United States (11 U.S.C. 101 et seq.), naming guarantor as debtor within ten (10) days after commencement of the proceeding.

6. Guarantor agrees to remain bound under this guarantee notwithstanding any modification or alteration of any obligation of [owner or operator] pursuant to 329 IAC 9.

7. 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 329 IAC 9-8 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 one hundred twenty (120) days after receipt of such notice by [owner or operator] as evidenced by the return receipt.

8. 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 [local government owner or operator] arising from, and in the course of, employment by [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 [local government owner or operator] that is not the direct result of a release from a petroleum underground storage tank.

e. Bodily injury or property damage for which [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 329 IAC 9-8-4.

9. Guarantor expressly waives notice of acceptance of this guarantee by IDEM, 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 329 IAC 9-8-16(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:

  (e) 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:

Local Government Guarantee without Standby

Trust Made by a Local Government

Guarantee made this [date] by [insert name of guaranteeing entity], a local government organized under the laws of [insert name of state], herein referred to as guarantor, to the Indiana Department of Environmental Management (IDEM) and to any and all third parties, and obligees, on behalf of [local government owner or operator].

Recitals

1. Guarantor meets or exceeds [select one (1): the local government bond rating test requirements of 329 IAC 9-8-14, the local government financial test requirements of 329 IAC 9-8-15, or the local government fund under 329 IAC 9-8-17(a)(1), 329 IAC 9-8-17(a)(2), or 329 IAC 9-8-17(a)(3)].

2. [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 one (1) instrument is used to assure different tanks at any one (1) facility, for each tank covered by this instrument, list the tank identification number provided in the notification submitted pursuant to 329 IAC 9-2-2, and the name and address of the facility.] This guarantee satisfies 329 IAC 9-8 requirements for assuring funding for [insert "taking corrective action" or "compensating third parties for bodily injury and property damage caused by" or "taking corrective action and 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.

3. Incident to our substantial governmental relationship with [local government owner or operator], guarantor guarantees to IDEM and to any and all third parties and obligees 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 IDEM commissioner 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 IDEM commissioner, 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 IDEM commissioner 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 329 IAC 9-5, the guarantor, upon written instructions from the IDEM commissioner, 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 [insert "sudden" or "nonsudden" or both] 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 IDEM commissioner, 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.

4. 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 (1), guarantor shall send within one hundred twenty (120) days of such failure, by certified mail, notice to [local government owner or operator] as evidenced by the return receipt.

5. Guarantor agrees to notify [owner or operator] by certified mail of a voluntary or involuntary proceeding under the bankruptcy laws of the United States (11 U.S.C. 101 et seq.), naming guarantor as debtor within ten (10) days after commencement of the proceeding.

6. Guarantor agrees to remain bound under this guarantee notwithstanding any modification or alteration of any obligation of [owner or operator] pursuant to 329 IAC 9.

7. 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 329 IAC 9-8 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 one hundred twenty (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.

8. 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 [local government owner or operator] arising from, and in the course of, employment by [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 [local government owner or operator] that is not the direct result of a release from a petroleum underground storage tank.

e. Bodily injury or property damage for which [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 329 IAC 9-8-4.

9. Guarantor expressly waives notice of acceptance of this guarantee by IDEM, 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 329 IAC 9-8-16(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:

(Solid Waste Management Division; 329 IAC 9-8-16; filed Jul 19, 1999, 12:00 p.m.: 22 IR 3752; readopted filed Jan 10, 2001, 3:25 p.m.: 24 IR 1535)