Md. Code Regs. 15.20.13.09

Current through Register Vol. 51, No. 26, December 27, 2024

Section 15.20.13.09 - [Effective until 4/15/2025] Performance Bonds, Liability Insurance, or Other Form of Security

A. A person applying for a Food Processing Residuals Utilization Permit shall file with the Department a performance bond on a form prescribed or approved by the Department, liability insurance, or other form of security. The performance bond, liability insurance, or other form of security shall be payable to the Department and the obligation of the performance bond, liability' insurance, or other form of security shall be conditioned upon the compliance with the terms and conditions of the Food Processing Residuals Utilization Permit.

B. The amount of the performance bond, liability insurance, or other form of security shall be:

(1) For the initial permit to transport food processing residuals to and from an agricultural operation, $10,000;

(2) For the initial permit to apply food processing residuals on agricultural land, $30,000; and

(3) For the initial permit to store food processing residuals at a storage facility, $100,000.

C. The Department may allow a permittee obtaining several Food Processing Residuals Utilization Permits to utilize food processing residuals in conjunction with agricultural land to file one performance bond, liability insurance, or other form of security to satisfy the security requirements for more than one utilization site.

D. For each additional permit that the applicant seeks, the amount of the performance bond, liability' insurance, or other form of security shall be 40 percent of the amount required in §B of this regulation up to a maximum amount of $200,000, as shown in the following examples:

(1) Example One: If a person is seeking two storage facility: permits and two transportation permits, the bond amount is $154,000, which amount is the sum of the following two figures:

(a) $140,000 for the two storage permits, that being: $100,000 for the initial permit plus $40,000 (40% of $100,000) for the second permit); and

(b) $14,000 for the two transportation permits, that being: $10,000 for the initial permit plus $4,000 (40% of $10,000) for the second permit); and

(2) Example Two: If a person is seeking four storage permits and four transportation permits, the bond amount, while separately exceeding $200,000, will be capped at $200,000.

E. Liability under the performance bond, liability insurance, or other form of security shall remain in effect until all terms and conditions of the Food Processing Residuals Utilization Permit have been met. The Department may release the performance bond, liability insurance, or other form of security after the Department has determined that all terms and conditions of the Food Processing Residuals Utilization Permits covered by the performance bond, liability insurance, or other form of security have been complied with.

F. The performance bond, liability insurance, or other form of security shall be executed by the person applying for a Food Processing Residuals Utilization Permit and obtained from a corporate surety licensed to do business in this State. Instead of a performance bond, liability insurance, or other form of security executed by a corporate surety, the person may elect to deposit with the Department cash or negotiable bonds of the federal government or of this State or any other securities acceptable to the Department. The amount of the cash deposit or the market value of any securities shall be at least equal to the required sum of the performance bond, liability insurance, or other form of security. The Department shall receive and hold the cash or securities in trust, for the purposes for which the deposit is posted.

G. The obligation of the person applying for a Food Processing Residuals Utilization Permit and of any corporate surety under the performance bond, liability insurance, or other form of security shall become due and payable, and all or any part of any cash or securities due and payable, and all or any part of any cash or securities shall be applied to payment of the costs of complying with any requirement of the Food Processing Residuals Utilization Permit if the Department has:

(1) Notified the permittee and any corporate surety that the terms and conditions of the Food Processing Residuals Utilization Permit have not been complied with, and has specified in the notice the particular noncompliance with the Food Processing Residuals Utilization Permit terms or conditions;

(2) Given the permittee a reasonable opportunity to correct the deficiencies and to comply with all of the terms and conditions of the Food Processing Residuals Utilization Permit; and

(3) Determined that, at the end of a reasonable length of time, some or all of the noncompliance specified under §G(1) of this regulation remain uncorrected.

Md. Code Regs. 15.20.13.09

Regulations .09 adopted effective 51:23 Md. R. 1035, effective 10/16/2024, exp. 4/15/2025 (Emergency).