Administrative Code

Virginia Administrative Code
1/18/2022

Part 800. Requirements for Bonding of Surface Coal Mining and Reclamation Operations

4VAC25-130-800.11. Requirement to file a bond.

(a) After a permit application under Subchapter VG has been approved, but before the permit is issued, the applicant shall file with the division, on a form prescribed and furnished by the division, a bond or bonds for performance made payable to the division and conditioned upon the faithful performance of all the requirements of the Act, the permit, and the reclamation plan, in accordance with Parts 800 or 801.

(b)(1) The bond or bonds shall cover the entire permit area, or for operations bonded under Part 801, an identified increment of land within the permit area upon which the permittee will initiate and conduct surface coal mining and reclamation operations during the initial term of the permit.

(2) For operations bonded under Part 801-

(A) As surface coal mining and reclamation operations on succeeding increments are initiated and conducted within the permit area, the permittee shall file with the division an additional bond or bonds to cover such increments in accordance with this section.

(B) The permittee shall identify the initial and successive areas or increments for bonding on the permit application map submitted for approval as provided in the application (under Parts 780 and 784), and shall specify the bond amount to be provided for each area or increment.

(C) Independent increments shall be of sufficient size and configuration to provide for efficient reclamation operations should reclamation by the division become necessary pursuant to 4VAC25-130-800.50.

(c) A permittee shall not disturb any surface areas, succeeding increments, or extend any underground shafts, tunnels or operations prior to acceptance by the division of the required performance bond.

(d) The applicant shall file, for approval by the division, a bond or bonds under one of the following schemes for the permit area as determined in accordance with 4VAC25-130-800.14 or Part 801:

(1) The entire performance bond required by 4VAC25-130-801.13;

(2) A performance bond or bonds for the entire permit area;

(3) A cumulative bond schedule and the performance bond required for full reclamation of the initial area to be disturbed; or

(4) For operations bonded under Part 801, an incremental bond schedule and the performance bond required for the first increment in the schedule.

Statutory Authority

§§ 45.1-161.3 and 45.1-230 of the Code of Virginia.

Historical Notes

Derived from VR480-03-19 § 800.11, eff. December 15, 1981; amended, eff. June 28, 1982; October 28, 1982; December 14, 1982; October 11, 1983; December 27, 1983; May 8, 1984; June 22, 1984; August 2, 1984; October 16, 1985; January 7, 1987; July 22, 1987; November 25, 1987; October 12, 1988; December 26, 1990; July 1, 1991; July 17, 1991; November 20, 1991; July 7, 1992; May 5, 1993; October 19, 1994.

4VAC25-130-800.12. Form of the performance bond.

The division shall prescribe the form of the performance bond and may allow:

(a) A surety bond;

(b) A collateral bond;

(c) An escrow account; or

(d) A combined surety/escrow account;

(e) A combination of any of the bonding methods listed in (a) through (d); or

(f) A self bond in accordance with 4VAC25-130-801.13.

Statutory Authority

§§ 45.1-161.3 and 45.1-230 of the Code of Virginia.

Historical Notes

Derived from VR480-03-19 § 800.12, eff. December 15, 1981; amended, eff. June 28, 1982; October 28, 1982; December 14, 1982; October 11, 1983; December 27, 1983; May 8, 1984; June 22, 1984; August 2, 1984; October 16, 1985; January 7, 1987; July 22, 1987; November 25, 1987; October 12, 1988; December 26, 1990; July 1, 1991; July 17, 1991; November 20, 1991; July 7, 1992; May 5, 1993; October 19, 1994.

4VAC25-130-800.13. Period of liability.

(a) Performance bond liability shall be for the duration of the surface coal mining and reclamation operation and for a period which is coincident with the permittee's period of extended responsibility for successful revegetation provided in 4VAC25-130-816.116 or 4VAC25-130-817.116 or until achievement of the reclamation requirements of the Act, and the permit, whichever is later.

(b) Isolated and clearly defined portions of the permit area requiring extended liability may be separated from the original area and bonded separately with the approval of the division. Such areas shall be limited in extent and shall not constitute a scattered, intermittent, or checkerboard pattern of failure. Access to the separated areas for remedial work may be included in the area under extended liability if deemed necessary by the division.

(c) If the division approves a long-term, intensive agricultural postmining land use, in accordance with 4VAC25-130-816.133 or 4VAC25-130-817.133, the 5 year period of liability shall commence at the date of initial planting for such long-term agricultural use.

(d)(1) The bond liability of the permittee shall include only those actions which he is obligated to take under the permit, including completion of the reclamation plan, so that the land will be capable of supporting the postmining land use approved under 4VAC25-130-816.133 or 4VAC25-130-817.133.

(2) Implementation of an alternative postmining land use approved under 4VAC25-130-816.133(c) or 4VAC25-130-817.133(c) which is beyond the control of the permittee, need not be covered by the bond. Bond liability for prime farmland shall be as specified in 4VAC25-130-800.40(c)(2).

Statutory Authority

§§ 45.1-161.3 and 45.1-230 of the Code of Virginia.

Historical Notes

Derived from VR480-03-19 § 800.13, eff. December 15, 1981; amended, eff. June 28, 1982; October 28, 1982; December 14, 1982; October 11, 1983; December 27, 1983; May 8, 1984; June 22, 1984; August 2, 1984; October 16, 1985; January 7, 1987; July 22, 1987; November 25, 1987; October 12, 1988; December 26, 1990; July 1, 1991; July 17, 1991; November 20, 1991; July 7, 1992; May 5, 1993; October 19, 1994.

4VAC25-130-800.14. Determination of bond amount.

(a) The amount of the bond required for each bonded area shall:

(1) Be determined by the division;

(2) Depend upon the requirements of the approved permit and reclamation plan;

(3) Reflect the probable difficulty of reclamation, giving consideration to such factors as topography, geology, hydrology, and revegetation potential; and

(4) Be based on, but not limited to, the estimated cost of reclamation submitted by the permit applicant.

(b) The amount of the bond shall be sufficient to assure the completion of the reclamation plan if the work has to be performed by the division in the event of forfeiture, and in no case shall the total bond initially posted for the entire area under one permit be less than $10,000.

(c) A permittee's financial responsibility under 4VAC25-130-817.121(c) for repairing material damage resulting from subsidence may be satisfied by the liability insurance policy required under 4VAC25-130-800.60.

Statutory Authority

§§ 45.1-161.3 and 45.1-230 of the Code of Virginia.

Historical Notes

Derived from VR480-03-19 § 800.14, eff. December 15, 1981; amended, eff. June 28, 1982; October 28, 1982; December 14, 1982; October 11, 1983; December 27, 1983; May 8, 1984; June 22, 1984; August 2, 1984; October 16, 1985; January 7, 1987; July 22, 1987; November 25, 1987; October 12, 1988; December 26, 1990; July 1, 1991; July 17, 1991; November 20, 1991; July 7, 1992; May 5, 1993; October 19, 1994.

4VAC25-130-800.15. Adjustment of amount.

(a) The amount of the bond or deposit required and the terms of the acceptance of the applicant's bond shall be adjusted by the division from time to time as the area requiring bond coverage is increased or decreased or where the cost of future reclamation changes. The division may specify periodic times or set a schedule for reevaluating and adjusting the bond amount to fulfill this requirement.

(b) The division shall:

(1) Notify the permittee, the surety, and any person with a property interest in collateral who has requested notification under 4VAC25-130-800.21(c) of any proposed adjustment to the bond amount; and

(2) Provide the permittee an opportunity for an informal conference on the adjustment.

(c) A permittee may request reduction of the amount of the performance bond upon submission of evidence to the division proving that the permittee's method of operation or other circumstances reduces the estimated cost for the division to reclaim the bonded area. Bond adjustments which involve undisturbed land or revision of the cost estimate of reclamation are not considered bond release subject to procedures of 4VAC25-130-800.40.

(d) In the event that an approved permit is revised in accordance with Subchapter VG, the division shall review the bond for adequacy and, if necessary, shall require adjustment of the bond to conform to the permit as revised.

Statutory Authority

§§ 45.1-161.3 and 45.1-230 of the Code of Virginia.

Historical Notes

Derived from VR480-03-19 § 800.15, eff. December 15, 1981; amended, eff. June 28, 1982; October 28, 1982; December 14, 1982; October 11, 1983; December 27, 1983; May 8, 1984; June 22, 1984; August 2, 1984; October 16, 1985; January 7, 1987; July 22, 1987; November 25, 1987; October 12, 1988; December 26, 1990; July 1, 1991; July 17, 1991; November 20, 1991; July 7, 1992; May 5, 1993; October 19, 1994.

4VAC25-130-800.16. General terms and conditions of bond.

(a) The performance bond shall be in an amount determined by the division as provided in 4VAC25-130-800.14 or Part 801.

(b) The performance bond shall be payable to the Commonwealth of Virginia, Director-Division of Mined Land Reclamation.

(c) The performance bond shall be conditioned upon faithful performance of all the requirements of the Act, this chapter, and the approved permit, including completion of the reclamation plan.

(d) The duration of the bond shall be for the time period provided in 4VAC25-130-800.13.

(e)(1) The bond shall provide a mechanism for a bank or surety company to give prompt notice to the division and the permittee of any action filed alleging the insolvency or bankruptcy of the surety company, the bank, or the permittee, or alleging any violations which would result in suspension or revocation of the surety or bank charter or license to do business.

(2) Upon the incapacity of a bank or surety company by reason of bankruptcy, insolvency, or suspension or revocation of a charter or license, the permittee shall be deemed to be without bond coverage and shall promptly notify the division. The division, upon notification received through procedures of Paragraph (e)(1) of this section or from the permittee, shall, in writing, notify the permittee who is without bond coverage and specify a reasonable period, not to exceed 90 days, to replace bond coverage. If an adequate bond is not posted by the end of the period allowed, the permittee shall cease coal extraction and shall comply with the provisions of 4VAC25-130-816.132 or 4VAC25-130-817.132 and shall immediately begin to conduct reclamation operations in accordance with the reclamation plan. Mining operations shall not resume until the division has determined that an acceptable bond has been posted.

Statutory Authority

§§ 45.1-161.3 and 45.1-230 of the Code of Virginia.

Historical Notes

Derived from VR480-03-19 § 800.16, eff. December 15, 1981; amended, eff. June 28, 1982; October 28, 1982; December 14, 1982; October 11, 1983; December 27, 1983; May 8, 1984; June 22, 1984; August 2, 1984; October 16, 1985; January 7, 1987; July 22, 1987; November 25, 1987; October 12, 1988; December 26, 1990; July 1, 1991; July 17, 1991; November 20, 1991; July 7, 1992; May 5, 1993; October 19, 1994.

4VAC25-130-800.17. Bonding requirements for underground coal mines and long-term coal-related surface facilities and structures.

(a) Responsibilities. The division shall require bond coverage, in an amount determined under 4VAC25-130-800.14 or Part 801, for long-term surface facilities and structures, and for areas disturbed by surface impacts incident to underground mines, for which a permit is required. Specific reclamation techniques required for underground mines and long-term facilities shall be considered in determining the amount of bond to complete the reclamation. Facilities for which bond is furnished in accordance with Part 801 are excluded from this section, except as provided in 4VAC25-130-801.12(e).

(b) Long-term period of liability.

(1) The period of liability for every bond covering long-term surface disturbances shall commence with the issuance of the permit, except that to the extent that such disturbances will occur on a succeeding increment to be bonded, such liability will commence upon the posting of the bond for that increment before the initial surface disturbance of that increment. The liability period shall extend until all reclamation, restoration, and abatement work under the permit has been completed and the bond is released under the provisions of 4VAC25-130-800.40, or until the bond has been replaced or extended in accordance with 4VAC25-130-800.17(b)(3).

(2) Long-term surface disturbances shall include long-term coal-related surface facilities and structures, and surface impacts incident to underground coal mining, which disturb an area for a period that exceeds five years. Long-term surface disturbances include, but are not limited to: surface features of shafts and slope facilities, coal refuse areas, powerlines, bore-holes, ventilation shafts, preparation plants, machine shops, roads, and loading and treatment facilities.

(3) To achieve continuous bond coverage for long-term surface disturbances, the bond shall be conditioned upon extension, replacement, or payment in full, 30 days prior to the expiration of the bond term.

(4) Continuous bond coverage shall apply throughout the period of extended responsibility for successful revegetation and until the provisions of 4VAC25-130-800.40 have been met.

(c) Bond forfeiture. The division shall take action to forfeit a bond pursuant to this section, if 30 days prior to bond expiration, the permittee has not filed: (1) a performance bond for a new term as required for continuous coverage, or (2) a performance bond providing coverage for the period of liability, including the period of extended responsibility for successful revegetation.

Statutory Authority

§§ 45.1-161.3 and 45.1-230 of the Code of Virginia.

Historical Notes

Derived from VR480-03-19 § 800.17, eff. December 15, 1981; amended, eff. June 28, 1982; October 28, 1982; December 14, 1982; October 11, 1983; December 27, 1983; May 8, 1984; June 22, 1984; August 2, 1984; October 16, 1985; January 7, 1987; July 22, 1987; November 25, 1987; October 12, 1988; December 26, 1990; July 1, 1991; July 17, 1991; November 20, 1991; July 7, 1992; May 5, 1993; October 19, 1994.

4VAC25-130-800.20. Surety bonds.

(a) A surety bond shall be executed by the permittee and a corporate surety licensed to do business in the Commonwealth.

(b) Surety bonds shall be noncancellable during their terms, except that surety bond coverage for lands not disturbed may be cancelled with the prior consent of the division. The division shall advise the surety, within 30 days after receipt of a notice to cancel bond, whether the bond may be cancelled on an undisturbed area.

Statutory Authority

§§ 45.1-161.3 and 45.1-230 of the Code of Virginia.

Historical Notes

Derived from VR480-03-19 § 800.20, eff. December 15, 1981; amended, eff. June 28, 1982; October 28, 1982; December 14, 1982; October 11, 1983; December 27, 1983; May 8, 1984; June 22, 1984; August 2, 1984; October 16, 1985; January 7, 1987; July 22, 1987; November 25, 1987; October 12, 1988; December 26, 1990; July 1, 1991; July 17, 1991; November 20, 1991; July 7, 1992; May 5, 1993; October 19, 1994.

4VAC25-130-800.21. Collateral bonds.

(a) Collateral bonds, except for letters of credit, shall be subject to the following conditions: The division shall—

(1) Keep custody of collateral deposited by the applicant until authorized for release or replacement as provided in this Subchapter.

(2) Value collateral at its current market value, not at face value.

(3) Require that certificates of deposit be made payable to or assigned to the Commonwealth of Virginia, Director-Division of Mined Land Reclamation, both in writing and upon the records of the bank issuing the certificates. The division shall require the banks issuing these certificates to waive all rights of setoff or liens against those certificates and that such certificates be automatically renewable.

(4) Not accept an individual certificate of deposit in an amount in excess of $100,000 or the maximum insurable amount as determined by the Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation.

(5) Require the applicant to deposit the certificates of deposit in a sufficient amount to assure that the division will be able to liquidate the certificates prior to maturity, upon forfeiture, for the amount of the bond required by this Subchapter.

(6) Require the applicant to designate, with the bond submitted, the person to whom—

(i) The collateral will be endorsed and returned upon release or replacement as provided in this Subchapter; and

(ii) Any interest or dividends paid on the collateral shall be paid.

(b) Cash accounts shall be subject to the following conditions:

(1) The division may authorize the permittee to supplement the bond through the establishment of a cash account in one or more federally- insured or equivalently protected accounts made payable upon demand to the division. The total bond including the cash account shall not be less than the amount required under terms of performance bonds including any adjustments, less amounts released in accordance with 4VAC25-130-800.40 or 4VAC25-130-801.18.

(2) Any interest paid on a cash account shall be paid to the permittee.

(3) Certificates of deposit may be substituted for a cash account with the approval of the division.

(4) The division shall not accept an individual cash account in an amount in excess of $100,000 or the maximum insurable amount as determined by the Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation.

(c) Letters of credit shall be subject to the following conditions:

(1) The letter may be issued only by a bank organized or authorized to do business in the United States and must conform to the Uniform Customs and Practice for Documentary Credits (1993 Revision) International Chamber of Commerce (Publication No. 500);

(2) Letters of credit shall be irrevocable during their terms. A letter of credit used as security in areas requiring continuous bond coverage shall be forfeited and shall be collected by the division if not replaced by other suitable bond or letter of credit at least 30 days before its expiration date; and

(3) The letter of credit shall be payable to the department at sight, in part or in full, upon receipt from the division of a notice of forfeiture issued in accordance with 4VAC25-130-800.50.

(d) Persons with an interest in collateral posted as a bond, and who desire notification of actions pursuant to the bond, shall request the notification in writing to the division at the time collateral is offered.

Statutory Authority

§§ 45.1-161.3 and 45.1-230 of the Code of Virginia.

Historical Notes

Derived from VR480-03-19 § 800.21, eff. December 15, 1981; amended, eff. June 28, 1982; October 28, 1982; December 14, 1982; October 11, 1983; December 27, 1983; May 8, 1984; June 22, 1984; August 2, 1984; October 16, 1985; January 7, 1987; July 22, 1987; November 25, 1987; October 12, 1988; December 26, 1990; July 1, 1991; July 17, 1991; November 20, 1991; July 7, 1992; May 5, 1993; October 19, 1994; Virginia Register Volume 20, Issue 10, eff. February 25, 2004.

4VAC25-130-800.23. Escrow bonding.

(a) The division may authorize the permittee to supplement a bonding program through the establishment of an escrow account deposited in one or more federally insured accounts payable on demand only to the division or deposited with the division directly. Contributions to the account may be based on acres affected or tons of coal produced or any other rate approved by the division. In all cases, the total bond including any escrow amount, as determined by the division in the bonding schedule, shall not be less than the amount required under 4VAC25-130-800.14 or Part 801, including any adjustments, less amounts released under 4VAC25-130-800.40 or Part 801.

(b) Escrow funds deposited in federally insured accounts shall not exceed the maximum insured amount under applicable Federal insurance programs such as by FDIC or FSLIC.

(c) Interest paid on escrow accounts shall be retained in the escrow account and applied to the bond value of the escrow account unless the division has approved that the interest be paid to the permittee. In order to qualify for interest payment, the permittee shall request such action in writing during the permit application process under 4VAC25-130-800.11.

(d) Certificates of deposit may be substituted for escrow accounts upon approval of the division. Provisions of 4VAC25-130-800.21 shall apply to certificates of deposit as collateral bond.

Statutory Authority

§§ 45.1-161.3 and 45.1-230 of the Code of Virginia.

Historical Notes

Derived from VR480-03-19 § 800.23, eff. December 15, 1981; amended, eff. June 28, 1982; October 28, 1982; December 14, 1982; October 11, 1983; December 27, 1983; May 8, 1984; June 22, 1984; August 2, 1984; October 16, 1985; January 7, 1987; July 22, 1987; November 25, 1987; October 12, 1988; December 26, 1990; July 1, 1991; July 17, 1991; November 20, 1991; July 7, 1992; May 5, 1993; October 19, 1994.

4VAC25-130-800.24. Combined surety/escrow bonding.

(a) The division may accept a combined surety/escrow bonding schedule provided that:

(1) A surety bond payable to the division is posted in the amount determined under 4VAC25-130-800.14 or 4VAC25-130-801.12 for reclamation of each successive increment, and

(2) An interest-bearing escrow account payable to the division with a predetermined deposit amount and frequency is established.

(b) Conditions of the combined surety/escrow bonding method shall be as follows:

(1) Surety bond.

(i) The term of the surety bond shall be not less than two years.

(ii) The amount of the surety bond shall always be sufficient to cover the difference between the escrow balance and the total reclamation cost.

(iii) The surety bond may be reduced in amount, but the liability remaining shall depend on the escrow-deposit rate which shall be subject to provisions of 4VAC25-130-800.15 and 4VAC25-130-800.30.

(iv) The surety bond shall be noncancellable by the surety during the bond term.

(v) Surety bond coverage may be released by the division without applying the bond-release criteria of 4VAC25-130-800.40 at any time during the bond term, provided provisions of Paragraph (b)(2)(vi) of this section are met or are in accordance with the provisions of bond replacement under 4VAC25-130-800.30.

(vi) The surety bond is subject to the conditions of bond forfeiture of 4VAC25-130-800.50, including noncompliance with the escrow account provisions of Paragraph (b)(2) of this section.

(2) Escrow account.

(i) The terms and conditions of the escrow account shall be developed jointly by the permittee, surety, and the division. For the purposes of this section, the development of the escrow account shall be based on a production basis in an amount not less than that required to make the escrow account equal to or greater than the bond requirement within the term of the surety bond as agreed on jointly by the permittee, the surety, and the division. Deposits to the escrow account by the permittee shall be made monthly and so reported to the division. Failure to make deposits on schedule shall be just cause for action by the division.

(ii) A certified escrow account balance statement shall be provided quarterly to the surety and the division.

(iii) Provisions of the escrow account shall be in accordance with 4VAC25-130-800.23.

(iv) The deposit amount shall be adjusted to provide for changing reclamation costs in accordance with 4VAC25-130-800.15. However, when the escrow account equals or exceeds the total bonding amount, the monthly payment of the permittee shall continue, at the option of the division, in an amount necessary to provide for any foreseeable adjustments.

(v) The escrow account shall be subject to the bond forfeiture conditions of 4VAC25-130-800.50.

(vi) The escrow account balance shall equal the initial bond amount, plus any adjustments required by Paragraph (b)(2)(i), 120 days prior to surety bond termination, unless the total amount required has been previously reduced through the bond release procedures of 4VAC25-130-800.40.

(vii) Release of liability under the escrow account shall be subject to the provisions of 4VAC25-130-800.40.

(c) Provisions of 4VAC25-130-800.40 may be applied to both surety and escrow bond coverage during the bond term.

(d) The surety/escrow combination may be repeated successively or amended during the term by replacing the escrow account with a surety bond, and reestablishing the escrow terms and deposit rate, subject to division approval.

Statutory Authority

§§ 45.1-161.3 and 45.1-230 of the Code of Virginia.

Historical Notes

Derived from VR480-03-19 § 800.24, eff. December 15, 1981; amended, eff. June 28, 1982; October 28, 1982; December 14, 1982; October 11, 1983; December 27, 1983; May 8, 1984; June 22, 1984; August 2, 1984; October 16, 1985; January 7, 1987; July 22, 1987; November 25, 1987; October 12, 1988; December 26, 1990; July 1, 1991; July 17, 1991; November 20, 1991; July 7, 1992; May 5, 1993; October 19, 1994.

4VAC25-130-800.30. Replacement of bonds.

(a) The division may allow a permittee to replace existing bonds with other bonds that provide equivalent coverage.

(b) The division shall not release existing performance bonds until the permittee has submitted, and the division has approved, acceptable replacement performance bonds. Replacement of a performance bond pursuant to this section shall not constitute a release of bond under 4VAC25-130-800.40.

Statutory Authority

§§ 45.1-161.3 and 45.1-230 of the Code of Virginia.

Historical Notes

Derived from VR480-03-19 § 800.30, eff. December 15, 1981; amended, eff. June 28, 1982; October 28, 1982; December 14, 1982; October 11, 1983; December 27, 1983; May 8, 1984; June 22, 1984; August 2, 1984; October 16, 1985; January 7, 1987; July 22, 1987; November 25, 1987; October 12, 1988; December 26, 1990; July 1, 1991; July 17, 1991; November 20, 1991; July 7, 1992; May 5, 1993; October 19, 1994.

4VAC25-130-800.40. Requirements to release performance bonds.

(a) Bond release application.

(1) The permittee may file an application with the division for the release of all or part of a performance bond. Applications may be filed only at times or during seasons authorized by the division in order to properly evaluate the completed reclamation operations. The times or seasons appropriate for the evaluation of certain types of reclamation shall be identified in the mining and reclamation plan required in Subchapter VG.

(2) Within 30 days after an application for bond release has been filed with the division, the permittee shall submit proof of publication of the advertisement placed at least once a week for four successive weeks in a newspaper of general circulation in the locality of the surface coal mining operation. The advertisement shall be considered part of any bond release application and shall contain the applicant's name, the permit number, notification of the precise location of the land affected, the number of acres, the type and amount of the bond filed and the portion sought to be released, the type and appropriate dates of reclamation work performed, a description of the results achieved as they relate to the permittee's approved reclamation plan, and the name and address of the division to which written comments, objections, or requests for public hearings and informal conferences on the specific bond release may be submitted pursuant to 4VAC25-130-800.40(f) and (h). In addition, as part of any bond release application, the permittee shall submit copies of letters which he has sent to adjoining property owners, local governmental bodies, planning agencies, sewage and water treatment authorities, and water companies in the locality in which the surface coal mining and reclamation operation took place, notifying them of the intention to seek release from the bond.

(3) The permittee shall include in the application for bond release a notarized statement which certifies that all applicable reclamation activities have been accomplished in accordance with the requirements of the Act, the regulatory program, and the approved reclamation plan. Such certification shall be submitted for each application or phase of bond release.

(b) Inspection by the division.

(1) Upon receipt of the bond release application, the division shall, within 30 days, or as soon thereafter as weather conditions permit, conduct an inspection and evaluation of the reclamation work involved. The evaluation shall consider, among other factors, the degree of difficulty to complete any remaining reclamation, whether pollution of surface and subsurface water is occurring, the probability of future occurrence of such pollution, and the estimated cost of abating such pollution. The surface owner, agent, or lessee shall be given notice of such inspection and may participate with the division in making the bond release inspection. The division may arrange with the permittee to allow access to the permit area, upon request by any person with an interest in the bond release, for the purpose of gathering information relevant to the proceeding.

(2) Within 60 days from the filing of the bond release application, if no public hearing is held pursuant to paragraph (f) of this section, or, within 30 days after a public hearing has been held pursuant to paragraph (f) of this section, the division shall notify in writing the permittee, the surety or other persons with an interest in the bond collateral who have requested notification under 4VAC25-130-800.21(c), and the persons who either filed objections in writing or objectors who were a party to the hearing proceedings, if any, of its decision to release or not to release all or part of the performance bond.

(c) The division may release all or part of the bond for the entire permit area or a portion of the permit area if the division is satisfied that all reclamation or a phase of the reclamation covered by the bond or portion thereof has been accomplished in accordance with the following schedules for reclamation of Phases I, II and III:

(1) At the completion of Phase I, after the permittee completes the backfilling, regrading (which may include the replacement of topsoil) and drainage control of a bonded area in accordance with the approved reclamation plan, 60% of the bond or collateral for the applicable area.

(2) At the completion of Phase II, after revegetation has been established on the regraded mined lands in accordance with the approved reclamation plan, an additional amount of bond. When determining the amount of bond to be released after successful revegetation has been established, the division shall retain that amount of bond for the revegetated area which would be sufficient to cover the cost of reestablishing revegetation if completed by a third party and for the period specified for permittee responsibility in § 45.1-241 of the Act for reestablishing revegetation. No part of the bond or deposit shall be released under this paragraph so long as the lands to which the release would be applicable are contributing suspended solids to streamflow or runoff outside the permit area in excess of the requirements set by § 45.1-242 of the Act and by Subchapter VK or until soil productivity for prime farmlands has returned to the equivalent levels of yield as nonmined land of the same soil type in the surrounding area under equivalent management practices as determined from the soil survey performed pursuant to § 45.1-238(D) of the Act and Part 823. Where a silt dam is to be retained as a permanent impoundment pursuant to Subchapter VK, the Phase II portion of the bond may be released under this paragraph so long as provisions for sound future maintenance by the permittee or the landowner have been made with the division.

(3) At the completion of Phase III, after the permittee has successfully completed all surface coal mining and reclamation activities, the release of the remaining portion of the bond, but not before the expiration of the period specified for permittee responsibility in 4VAC25-130-816.116 or 4VAC25-130-817.116. However, no bond shall be fully released under provisions of this section until reclamation requirements of the Act and the permit are fully met.

(d) If the division disapproves the application for release of the bond or portion thereof, the division shall notify the permittee, the surety, and any person with an interest in collateral as provided for in 4VAC25-130-800.21(c), in writing, stating the reasons for disapproval and recommending corrective actions necessary to secure the release and allowing an opportunity for a public hearing.

(e) When any application for total or partial bond release is filed with the division, the division shall notify the town, city or other municipality nearest the operation and the county in which the surface coal mining operation is located by certified mail at least 30 days prior to the release of all or a portion of the bond.

(f) Any person with a valid legal interest which might be adversely affected by release of the bond, or the responsible officer or head of any federal, state, or local governmental agency which has jurisdiction by law or special expertise with respect to any environmental, social, or economic impact involved in the operation or which is authorized to develop and enforce environmental standards with respect to such operations, shall have the right to file written objections to the proposed release from bond with the division within 30 days after the last publication of the notice required by 4VAC25-130-800.40(a)(2). If written objections are filed and a hearing is requested, the division shall inform all the interested parties of the time and place of the hearing, and shall hold a public hearing within 30 days after receipt of the request for the hearing. The date, time and location of the public hearing shall be advertised by the division in a newspaper of general circulation in the locality for two consecutive weeks. The public hearing shall be held in the locality of the surface coal mining operation from which bond release is sought, at the location of the division office, or at the State Capital, at the option of the objector. The decision of the Hearing Officer shall be made within 30 days from the close of the hearing.

(g) For the purpose of the hearing under paragraph (f) of this section, the division shall have the authority to administer oaths, subpoena witnesses or written or printed material, compel the attendance of witnesses or the production of materials, and take evidence including, but not limited to, inspection of the land affected and other surface coal mining operations carried on by the applicant in the general vicinity. A verbatim record of each public hearing shall be made, and a transcript shall be made available on the motion of any party or by order of the division.

(h) Without prejudice to the right of an objector or the applicant, the division may hold an informal conference as provided in § 45.1-239 of the Act to resolve such written objections. The division shall make a record of the informal conference unless waived by all parties, which shall be accessible to all parties. The division shall also furnish all parties of the informal conference with a written finding of the division based on the informal conference, and the reasons for said finding.

Statutory Authority

§§ 45.1-161.3 and 45.1-230 of the Code of Virginia.

Historical Notes

Derived from VR480-03-19 § 800.40, eff. December 15, 1981; amended, eff. June 28, 1982; October 28, 1982; December 14, 1982; October 11, 1983; December 27, 1983; May 8, 1984; June 22, 1984; August 2, 1984; October 16, 1985; January 7, 1987; July 22, 1987; November 25, 1987; October 12, 1988; December 26, 1990; July 1, 1991; July 17, 1991; November 20, 1991; July 7, 1992; May 5, 1993; October 19, 1994; Virginia Register Volume 15, Issue 6, eff. January 6, 1999.

4VAC25-130-800.50. Forfeiture of bonds.

(a) If the permittee refuses or is unable to conduct reclamation of an unabated violation, fails to comply with the terms of the permit, or defaults on the conditions under which the bond was accepted, the division shall take the following action to forfeit all or part of a bond or bonds for the permit area or a portion of the permit area:

(1) Send written notification by certified mail, return receipt requested, to the permittee and the surety on the bond, if any, informing them of the determination to forfeit all or part of the bond, including the reasons for the forfeiture and the amount to be forfeited. The amount shall be based on the estimated total cost of achieving the reclamation plan requirements.

(2) Advise the permittee and surety, if applicable, of the conditions under which forfeiture may be avoided. Such conditions may include, but are not limited to--

(i) Agreement by the permittee or another party to perform reclamation operations in accordance with a compliance schedule acceptable to the division, which meets the conditions of the permit, the reclamation plan, and demonstrates that such party has the ability to satisfy the conditions; or

(ii) The division may allow a surety to complete the reclamation plan if the surety can demonstrate an ability to complete the reclamation in accordance with the approved reclamation plan. Except where the division may approve partial release authorized under 4VAC25-130-800.40, no surety liability shall be released until successful completion of all reclamation under the terms of the permit, including applicable liability periods of 4VAC25-130-800.13.

(b) In the event forfeiture of the bond is required by this section, the division shall:

(1) Proceed to collect the forfeited amount as provided by Virginia law for the collection of defaulted bonds or other debts if actions to avoid forfeiture have not been taken, or if rights of appeal, if any, have not been exercised within a time established by the division, or if such appeal, if taken, is unsuccessful.

(2) Use funds collected from bond forfeiture to complete the reclamation plan on the permit area.

(c) Upon default, the division may cause the forfeiture of any and all bonds deposited to complete reclamation for which the bonds were posted. Unless specifically limited, as provided in 4VAC25-130-800.11(b)(3), bond liability shall extend to the entire permit area under conditions of forfeiture.

(d)(1) In the event the estimated amount forfeited is insufficient to pay for the full cost of reclamation, the permittee shall be liable for the remaining costs. The division may complete, or authorize completion of, reclamation of the bonded area and may recover from the permittee all costs of reclamation in excess of the amount forfeited.

(2) In the event the amount of performance bond forfeited was more than the amount necessary to complete reclamation, the unused funds shall be returned by the division to the party from whom they were collected.

Statutory Authority

§§ 45.1-161.3 and 45.1-230 of the Code of Virginia.

Historical Notes

Derived from VR480-03-19 § 800.50, eff. December 15, 1981; amended, eff. June 28, 1982; October 28, 1982; December 14, 1982; October 11, 1983; December 27, 1983; May 8, 1984; June 22, 1984; August 2, 1984; October 16, 1985; January 7, 1987; July 22, 1987; November 25, 1987; October 12, 1988; December 26, 1990; July 1, 1991; July 17, 1991; November 20, 1991; July 7, 1992; May 5, 1993; October 19, 1994.

4VAC25-130-800.51. Administrative review of performance bond forfeiture.

(a) The permittee or surety, if applicable, may request, in writing, a hearing on the division's determination to forfeit the performance bond within 30 days of receipt of the written determination from the division.

(b) A request for hearing shall not operate as a stay of the bond forfeiture decision. Unless the division decides to withhold forfeiture as provided by 4VAC25-130-800.50 (a) (2), it shall take immediate steps to collect the necessary performance bond amounts so that it, or its contractor, may complete the reclamation plan and any other regulatory requirements in the most expeditious manner possible, pending administrative and/or judicial review.

(c)(1) The division shall commence the hearing within 30 days of the hearing request. The hearing shall be conducted in accordance with § 2.2-4020 of the Code of Virginia by a Hearings Officer appointed by the director.

(2) The burden of proof at such hearing shall be on the party seeking to reverse the decision of the division.

(3) For the purpose of such hearing, the hearings officer may administer oaths and affirmations, subpoena witnesses, written or printed materials, compel attendance of witnesses or production of those materials, compel discovery, and take evidence, including but not limited to site inspections of the land affected.

(4) The hearings officer shall cause an accurate verbatim record of the hearing to be made. The division may charge the reasonable cost of preparing such record to any party who requests a copy of the record.

(5) Ex parte contacts between representatives of the parties to the hearing and the hearings officer shall be prohibited.

(6) Within 30 days after the close of the record, the division shall issue and furnish the permittee, surety (if applicable) and each person who participated in the hearing with the written findings of fact, conclusion of law, and order of the hearings officer with respect to the appeal. The decision of the hearings officer shall be final as of the date of issuance, subject to the review and reconsideration by the director or his designee, provided in subsection (d) of this section.

(d) Within 14 days after the issuance of the hearings officer's decision under subdivision (c) (6) of this section, the permittee, surety (if applicable), or any person who participated in the hearing and has an interest which is or may be adversely affected by the decision, may appeal to the director or his designee for review of the record and reconsideration of the hearings officer's decision. The director or his designee may also on his own motion, with notice to the parties, review the record and reconsider the hearings officer's decision within the same time period. No further evidence will be allowed in connection with such review and reconsideration, but the director or his designee may hear further arguments and may, after considering the record, remand the case for further hearing if he considers such action necessary to develop the facts. Within 30 days of the appeal or motion for review and reconsideration, the director or his designee shall complete his review of the hearings officer's decision and issue a final decision.

(e) All requests for hearing, or appeals for review and reconsideration made under this section; and all notices of appeal for judicial review of a hearing officer's final decision, or the final decision on review and reconsideration shall be filed with the Director, Division of Mined Land Reclamation, Department of Mines, Minerals and Energy, Post Office Drawer 900, Big Stone Gap, Virginia 24219.

Statutory Authority

§§ 45.1-161.3 and 45.1-230 of the Code of Virginia.

Historical Notes

Derived from VR480-03-19 § 800.51, eff. December 15, 1981; amended, eff. June 28, 1982; October 28, 1982; December 14, 1982; October 11, 1983; December 27, 1983; May 8, 1984; June 22, 1984; August 2, 1984; October 16, 1985; January 7, 1987; July 22, 1987; November 25, 1987; October 12, 1988; December 26, 1990; July 1, 1991; July 17, 1991; November 20, 1991; July 7, 1992; May 5, 1993; October 19, 1994; Virginia Register Volume 23, Issue 13, eff. April 4, 2007.

4VAC25-130-800.52. Bond forfeiture reinstatement procedures.

(a) Any person who owns or controls or has owned or controlled any operation on which the bond has been forfeited or the permit revoked pursuant to this chapter or pursuant to Chapters 15 [repealed], 17 (§ 45.1-198 et seq.) or 23 [repealed] of Title 45.1 of the Code of Virginia and who has not previously been reinstated by the director may petition the director for reinstatement. Reinstatement, if granted, shall be under such terms and conditions as set forth by the director or his designee. The director or his designee in determining the terms and conditions shall consider the particular facts and circumstances existing in each individual case. Reinstatement shall not be available to applicants for reinstatement where the division finds that the applicant controls or has controlled surface coal mining and reclamation operations with a demonstrated pattern of willful violations of the Act of such nature and duration and with such resulting irreparable damage to the environment as to indicate an intent not to comply with the Act, in accordance with 4VAC25-130-773.15(b)(3). As a minimum, the applicant for reinstatement shall satisfy the following requirements:

(1) Abatement of any outstanding violations existing on each site on which the bond has been forfeited or the permit revoked;

(2) Payment of any outstanding civil penalties (both state and federal), Reclamation fund taxes, and any outstanding fees, including Federal Abandoned Mine Land Reclamation taxes;

(3) Reclaim each site on which the bond was forfeited according to the applicable law, regulations and standards governing the site at the time of bond forfeiture;

(4) Payment to the director of any money expended by the Commonwealth in excess of the forfeited bond amount to accomplish the reclamation of the sites; and

(5) Pay to the director a reinstatement fee of $5,000 assessed by the director on each site forfeited. These fees shall be used by the director to accomplish reclamation on other forfeited or abandoned surface coal mining operations.

(b) Reinstatement by the director shall be a prerequisite to the filing by the person (applicant for reinstatement) of any new permit application or renewal under this chapter or Chapters 15 [repealed], 17 (§ 45.1-198 et seq.), or 23 [repealed] of Title 45.1 of the Code of Virginia, but shall not affect the person's need to comply with all other requirements of said statutes, regulations or both promulgated thereunder.

Statutory Authority

§§ 45.1-161.3 and 45.1-230 of the Code of Virginia.

Historical Notes

Derived from VR480-03-19 § 800.52, eff. December 15, 1981; amended, eff. June 28, 1982; October 28, 1982; December 14, 1982; October 11, 1983; December 27, 1983; May 8, 1984; June 22, 1984; August 2, 1984; October 16, 1985; January 7, 1987; July 22, 1987; November 25, 1987; October 12, 1988; December 26, 1990; July 1, 1991; July 17, 1991; November 20, 1991; July 7, 1992; May 5, 1993; October 19, 1994; Volume 29, Issue 13, eff. March 27, 2013.

4VAC25-130-800.60. Terms and conditions for liability insurance.

(a) The division shall require the applicant to submit prior to permit issuance a certificate issued by an insurance company licensed to do business in the Commonwealth certifying that the applicant has a public liability insurance policy in force for the surface coal mining and reclamation operations for which the permit is sought. Such policy shall provide for personal injury and property damage protection in an amount adequate to compensate any persons injured or property damaged as a result of the surface coal mining and reclamation operations, including the use of explosives, and who are entitled to compensation under the applicable provisions of Virginia law. Minimum insurance coverage under split limit for bodily injury and property damage shall be $300,000 for each occurrence and $500,000 aggregate. Minimum insurance coverage for bodily injury and property damage combined shall be $1,000,000 for each occurrence and $1,000,000 aggregate.

(b) The policy shall be maintained in full force during the life of the permit or any renewal thereof, including the liability period necessary to complete all reclamation operations under this chapter.

(c) The policy shall include a rider requiring that the insurer notify the division whenever substantive changes are made in the policy including any termination or failure to renew.

Statutory Authority

§§ 45.1-161.3 and 45.1-230 of the Code of Virginia.

Historical Notes

Derived from VR480-03-19 § 800.60, eff. December 15, 1981; amended, eff. June 28, 1982; October 28, 1982; December 14, 1982; October 11, 1983; December 27, 1983; May 8, 1984; June 22, 1984; August 2, 1984; October 16, 1985; January 7, 1987; July 22, 1987; November 25, 1987; October 12, 1988; December 26, 1990; July 1, 1991; July 17, 1991; November 20, 1991; July 7, 1992; May 5, 1993; October 19, 1994.

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