La. Admin. Code tit. 33 § XI-1113
Current through Register Vol. 50, No. 9, September 20, 2024
Section XI-1113 - GuaranteeA. An owner or operator may satisfy the requirements of LAC 33:XI.1107 by obtaining a guarantee that conforms to the requirements of this Section. The guarantor shall be as described in either Paragraph 1 or 2 of this Subsection. 1. The guarantor is a firm that: a. possesses a controlling interest in the owner or operator;b. possesses a controlling interest in a firm described under Subparagraph A.1.a of this Section; orc. is controlled through stock ownership by a common parent firm that possesses a controlling interest in the owner or operator.2. The guarantor is a firm engaged in a substantial business relationship with the owner or operator and is issuing the guarantee as an act incident to that business relationship.B. Within 120 days of the close of each financial reporting year the guarantor shall demonstrate that it meets the financial test criteria of LAC 33:XI.1111 based on year-end financial statements for the latest completed financial reporting year by completing the letter from the chief financial officer described in LAC 33:XI.1111.D and shall deliver the letter to the owner or operator. If the guarantor fails to meet the requirements of the financial test at the end of any financial reporting year, within 120 days of the end of that financial reporting year the guarantor shall send by certified mail, before cancellation or nonrenewal of the guarantee, notice to the owner or operator and to the Office of Environmental Assessment. If the Office of Environmental Assessment notifies the guarantor that he no longer meets the requirements of the financial test of LAC 33:XI.1111.B or C and D, the guarantor shall notify the owner or operator within 10 days of receiving such notification from the Office of Environmental Assessment. In both cases, the guarantee will terminate no less than 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 LAC 33:XI.1139.C.C. The guarantee shall be worded as follows, except that instructions in brackets are to be replaced with the relevant information and the brackets deleted. Guarantee
Guarantee made this [date] by [name of guaranteeing entity], a business entity organized under the laws of the state of [name of state], herein referred to as guarantor, to the Louisiana Department of Environmental Quality and to any and all third parties, and obligees, on behalf of [owner or operator] of [business address].
Recitals
1. Guarantor meets or exceeds the financial test criteria of LAC 33:XI.1111.B or C and D and agrees to comply with the requirements for guarantors as specified in LAC 33:XI.1113.B.2. [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 registration submitted pursuant to LAC 33:XI.301 and the name and address of the facility.] This guarantee satisfies the requirements of LAC 33:XI.Chapter 11 for assuring funding for [insert: "taking corrective action" and/or "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. [Insert appropriate phrase: "On behalf of our subsidiary" (if guarantor is corporate parent of the owner or operator); "On behalf of our affiliate" (if guarantor is a related firm of the owner or operator); or "Incident to our business relationship with" (if guarantor is providing the guarantee as an incident to a substantial business relationship with owner or operator)] [owner or operator], guarantor guarantees to the Department of Environmental Quality and to any and all third parties that: In the event that [owner or operator] fails to provide alternative coverage within 60 days after receipt of a notice of cancellation of this guarantee and the administrative authority of the Department of Environmental Quality has determined or suspects that a release has occurred at an underground storage tank covered by this guarantee, the guarantor, upon instructions from the administrative authority, shall fund a standby trust fund in accordance with the provisions of LAC 33:XI.1135 in an amount not to exceed the coverage limits specified above.
In the event that the administrative authority determines that [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 LAC 33:XI.715, the guarantor upon written instructions from the administrative authority shall fund a standby trust in accordance with the provisions of LAC 33:XI.1135, 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 ["sudden" and/or "nonsudden"] 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 administrative authority, shall fund a standby trust in accordance with the provisions of LAC 33:XI.1135 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 the financial test criteria of LAC 33:XI.1111.B or C and D, guarantor shall send within 120 days of such failure, by certified mail, notice to [owner or operator] and the administrative authority. The guarantee will terminate 120 days from the date of receipt of the notice by [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 Title 11 (Bankruptcy), U.S. Code, naming guarantor as debtor, within 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 the Department of Environmental Quality's Underground Storage Tank Regulations.7. Guarantor agrees to remain bound under this guarantee for so long as [owner or operator] shall comply with the applicable financial responsibility requirements of LAC 33:XI.Chapter 11 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 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 [insert owner or operator] under a worker's compensation, disability benefits, or unemployment compensation law or other similar law;b. bodily injury to an employee of [insert owner or operator] arising from, and in the course of, employment by [insert 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 [insert owner or operator] that is not the direct result of a release from a petroleum underground storage tank;e. bodily damage or property damage for which [insert 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 LAC 33:XI.1107.9. Guarantor expressly waives notice of acceptance of this guarantee by the Department of Environmental Quality, by any or all third parties, or by [owner or operator]. I hereby certify that the wording of this guarantee is identical to the wording specified in LAC 33:XI.1113.C 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:________________________
D. An owner or operator who uses a guarantee to satisfy the requirements of LAC 33:XI.1107 shall establish a standby trust fund when the guarantee is obtained. Under the terms of the guarantee, all amounts paid by the guarantor under the guarantee will be deposited directly into the standby trust fund in accordance with instructions from the administrative authority under LAC 33:XI.1135. This standby trust fund shall meet the requirements specified in LAC 33:XI.1125.La. Admin. Code tit. 33, § XI-1113
Promulgated by the Department of Environmental Quality, Office of Solid and Hazardous Waste, Underground Storage Tank Division, LR 16:614 (July 1990), amended by the Office of Environmental Assessment, Environmental Planning Division, LR 26:2561 (November 2000), amended by the Office of the Secretary, Legal Affairs Division, LR 31:2521 (October 2005), LR 33:2174 (October 2007), amended by the Office of the Secretary, Legal Division, LR 38:2763 (November 2012), Amended by the Office of the Secretary, Legal Affairs and Criminal Investigations Division, LR 432146 (11/1/2017), Amended by the Office of the Secretary, Legal Affairs and Criminal Investigations Division, LR 441623 (9/1/2018).AUTHORITY NOTE: Promulgated in accordance with R.S. 30:2001 et seq.