N.J. Admin. Code § 7:26C-5.8

Current through Register Vol. 56, No. 11, June 3, 2024

Section 7:26C-5.8 - Self-guarantee requirements

(a) Any person who chooses to provide a self-guarantee as a remediation funding source pursuant to this subchapter shall complete and submit to the Department a form found on the Department's website at www.nj.gov/dep/srp/srra/forms that contains the following information:

1. The applicable case number, the program interest name, and program interest number (preferred ID), site name and site address;

2. Information that demonstrates that the estimated cost of the remediation that the Department has approved or that a licensed site remediation professional has certified does not exceed one-third of the tangible net worth of the person required to establish the remediation funding source;

3. Information that demonstrates that the individual or entity possesses the required cash flow and has sufficient net cash provided by operating activities to pay for the remediation during the next 12-month period. Cash flow and net cash will be deemed sufficient if:

i. The individual's or entity's gross receipts exceed its gross payments in that fiscal year in an amount at least equal to the estimated costs of completing the remediation activities in the 12-month period following the date the application is made; and

ii. The individual or entity possess a net cash provided by operating activities in an amount at least equal to the estimated costs of completing the remediation activities in the 12-month period following the date the application is made;

4. Audited financial statements for the preceding fiscal year that ended closest to the date of the self guarantee statement, including, but not limited to, an income statement, a balance sheet and a consolidated statement of cash flow, in which the auditor expresses an unqualified opinion. This information must be prepared in accordance with Generally Accepted Accounting Principles prescribed by either the United States Financial Accounting Standards Board Accounting Standards Codification or the International Accounting Standards Board International Financial Reporting Standards. This information must be audited in accordance with the American Institute of Certified Public Accountants or the Public Company Accounting Oversight Board's auditing standards or the International Standards on Auditing; and

5. A statement from the chief financial officer or similar officer that the information in the written statement submitted pursuant to this subchapter is true to the best of the officer's information, knowledge and belief, and that it meets the requirements of 58:10B-3(f).

(b) A parent company may provide a self guarantee for a wholly owned subsidiary that is the person responsible for conducting the remediation when the wholly owned subsidiary does not have its own audited financial statements and its financial statements are reported through that parent company. The parent company must comply with all the requirements of this section.

(c) In the case of a special purpose entity created specifically for the purpose of acquiring and redeveloping a contaminated site, and for which a statement of income and expenses is not available, the documentation shall include a statement of assets and liabilities certified by a certified public accountant that the statement is prepared in accordance with the Generally Accepted Accounting Principles prescribed by either the United States Financial Accounting Standards Board's Accounting Standards Codification or the International Accounting Standards Board's International Financial Reporting Standards.

(d) The self-guarantee shall be valid for one year from the date of the submittal required in (a) above. Thereafter, the person shall:

1. Comply with the requirements of (a) above, and if applicable (b) and (c) above, annually, to provide a self-guarantee for each successive year that that person is required to maintain a remediation funding source and wishes to continue to provide a self-guarantee; and

2. Submit the information required by (a) above, and if applicable (b) and (c) above, to the Department 30 days prior to the date of expiration of the existing statement.

N.J. Admin. Code § 7:26C-5.8

Amended by 50 N.J.R. 1715(b), effective 8/6/2018