hazardous secondary materials, does the reclamation facility have the
permits required (if any) to manage the residuals? If not, does the
reclamation facility have a contract with an appropriately permitted
facility to dispose of the residuals? If not, does the hazardous
secondary material generator have credible evidence that the residuals
will be managed in a manner that is protective of human health and the
environment?

(C) The hazardous secondary material generator must maintain for a
minimum of three years documentation and certification that reasonable
efforts were made for each reclamation facility and, if applicable,
intermediate facility prior to transferring hazardous secondary
material. Documentation and certification must be made available upon
request by a regulatory authority within 72 hours, or within a longer
period of time as specified by the regulatory authority. The
certification statement must:

(1) be signed and dated by an authorized representative of the hazardous
secondary material generator company;

(2) incorporate the following language: “I hereby certify in good
faith and to the best of my knowledge that, prior to arranging for
transport of excluded hazardous secondary materials to [insert name(s)
of reclamation facility and any intermediate facility], reasonable
efforts were made to ensure that the hazardous secondary materials would
be recycled legitimately, and otherwise managed in a manner that is
protective of human health and the environment, and that such efforts
were based on current and accurate information.”

(D)  The hazardous secondary material generator must maintain at the
generating facility for no less than three (3) years records of all
off-site shipments of hazardous secondary materials. For each shipment,
these records must, at a minimum, contain the following information:

(1) Name of the transporter and date of the shipment;

(2) Name and address of each reclaimer and, if applicable, the name and
address of each intermediate facility to which the hazardous secondary
material was sent;

(3) The type and quantity of hazardous secondary material in the
shipment.

(E) The hazardous secondary material generator must maintain at the
generating facility for no less than three (3) years confirmations of
receipt from each reclaimer and, if applicable, each intermediate
facility for all off-site shipments of hazardous secondary materials.
Confirmations of receipt must include the name and address of the
reclaimer (or intermediate facility), the type and quantity of the
hazardous secondary materials received and the date which the hazardous
secondary materials were received.

(v) Reclaimers of hazardous secondary material excluded from regulation
under this exclusion and intermediate facilities as defined in §260.10
satisfy all of the following conditions:

(A)  The reclaimer and intermediate facility must maintain at its
facility for no less than three (3) years records of all shipments of
hazardous secondary material that were received at the facility and, if
applicable, for all shipments of hazardous secondary materials that were
received and subsequently sent off-site from the facility for further
reclamation. For each shipment, these records must at a minimum contain
the following information:

(1) Name of the transporter and date of the shipment;

(2) Name and address of the hazardous secondary material generator and,
if applicable, the name and address of the reclaimer or intermediate
facility which the hazardous secondary materials were received from;

(3) The type and quantity of hazardous secondary material in the
shipment; and

(4) For hazardous secondary materials that, after being received by the
reclaimer or intermediate facility, were subsequently transferred
off-site for further reclamation, the name and address of the
(subsequent) reclaimer and, if applicable, the name and address of each
intermediate facility to which the hazardous secondary material was
sent.

(B) The intermediate facility must send the hazardous secondary material
to the reclaimer(s) designated by the hazardous secondary materials
generator.

(C) The reclaimer and intermediate facility must send to the hazardous
secondary material generator confirmations of receipt for all off-site
shipments of hazardous secondary materials. Confirmations of receipt
must include the name and address of the reclaimer (or intermediate
facility), the type and quantity of the hazardous secondary materials
received and the date which the hazardous secondary materials were
received.

(D) The reclaimer and intermediate facility must manage the hazardous
secondary material in a manner that is at least as protective as that
employed for analogous raw material and must be contained.  An
"analogous raw material" is a raw material for which a hazardous
secondary material is a substitute and serves the same function and has
similar physical and chemical properties as the hazardous secondary
material

(E)  Any residuals that are generated from reclamation processes will be
managed in a manner that is protective of human health and the
environment.  If any residuals exhibit a hazardous characteristic
according to subpart C of 40 CFR part 261, or if they themselves are
specifically listed in subpart D of 40 CFR part 261, such residuals are
hazardous wastes and must be managed in accordance with the applicable
requirements of 40 CFR parts 260 through 272.

(F) The reclaimer and intermediate facility has financial assurance as
required under subpart H of 40 CFR part 261.

(vi)  In addition, all persons claiming the exclusion under this
paragraph (24) must provide notification as required under §260.42.

(25)  Hazardous secondary material that is exported from the United
States and reclaimed at a reclamation facility located in a foreign
country is not a solid waste, provided that the hazardous secondary
material generator complies with the applicable requirements of
§261.4(a)(24)(i)-(iv) (excepting (iv)(B)(2) of this section for foreign
reclaimers and foreign intermediate facilities), and that the hazardous
secondary material generator also complies with the following
requirements:

(i)  Notify EPA of an intended export before the hazardous secondary
material is   scheduled to leave the United States.  A complete
notification must be submitted at least sixty (60) days before the
initial shipment is intended to be shipped off-site.  This notification
may cover export activities extending over a twelve (12) month or lesser
period.  The notification must be in writing, signed by the hazardous
secondary material generator, and include the following information:

(A)  Name, mailing address, telephone number and EPA ID number (if
applicable) of the hazardous secondary material generator;

(B) A description of the hazardous secondary material and the EPA
hazardous waste number that would apply if the hazardous secondary
material was managed as hazardous waste and the U.S. DOT proper shipping
name, hazard class and ID number (UN/NA) for each hazardous secondary
material as identified in 49 CFR parts 171 through 177;

(C) The estimated frequency or rate at which the hazardous secondary
material is to be exported and the period of time over which the
hazardous secondary material is to be exported;

(D) The estimated total quantity of hazardous secondary material;

(E) All points of entry to and departure from each foreign country
through which the hazardous secondary material will pass;

(F) A description of the means by which each shipment of the hazardous
secondary material will be transported (e.g., mode of transportation
vehicle (air, highway, rail, water, etc.), type(s) of container (drums,
boxes, tanks, etc.));

(G) A description of the manner in which the hazardous secondary
material will be reclaimed in the receiving country;

(H) The name and address of the reclaimer, any intermediate facility and
any alternate reclaimer and intermediate facilities; and

(I) The name of any transit countries through which the hazardous
secondary material will be sent and a description of the approximate
length of time it will remain in such countries and the nature of its
handling while there.

(ii)  Notifications submitted by mail should be sent to the following
mailing address:  Office of Enforcement and Compliance Assurance, Office
of Federal Activities, International Compliance Assurance Division,
(Mail Code 2254A), Environmental Protection Agency, 1200 Pennsylvania
Ave., N.W., Washington, DC 20460. Hand-delivered notifications should be
delivered to: Office of Enforcement and Compliance Assurance, Office of
Federal Activities, International Compliance Assurance Division,
Environmental Protection Agency, Ariel Rios Bldg., Room 6144, 12th St.
and Pennsylvania Ave., N.W., Washington, DC 20004.  In both cases, the
following shall be prominently displayed on the front of the envelope:
“Attention:  Notification of Intent to Export.”

(iii)  Except for changes to the telephone number in paragraph (i)(A) of
this section and decreases in the quantity of hazardous secondary
material indicated pursuant to paragraph (i)(D) of this section, when
the conditions specified on the original notification change (including
any exceedance of the estimate of the quantity of hazardous secondary
material specified in the original notification), the hazardous
secondary material generator must provide EPA with a written
renotification of the change. The shipment cannot take place until
consent of the receiving country to the changes (except for changes to
paragraph i(I) of this section and in the ports of of entry to and
departure from transit countries pursuant to paragraphs (i)(E) of this
section) has been obtained and the hazardous secondary material
generator receives from EPA an Acknowledgment of Consent reflecting the
receiving country’s consent to the changes.

(iv) Upon request by EPA, the hazardous secondary material generator
shall furnish to EPA any additional information which a receiving
country requests in order to respond to a notification.

(v) EPA will provide a complete notification to the receiving country
and any transit countries.  A notification is complete when EPA receives
a notification which EPA determines satisfies the requirements of
paragraph (i) of this section.  Where a claim of confidentiality is
asserted with respect to any notification information required by
paragraph (i) of this section, EPA may find the notification not
complete until any such claim is resolved in accordance with 40 CFR
260.2.

 (vi) The export of hazardous secondary material under this paragraph is
prohibited unless the receiving country consents to the intended export.
When the receiving country consents in writing to the receipt of the
hazardous secondary material, EPA will send an Acknowledgment of Consent
to the hazardous secondary material generator. Where the receiving
country objects to receipt of the hazardous secondary material or
withdraws a prior consent, EPA will notify the hazardous secondary
material generator in writing.  EPA will also notify the hazardous
secondary material generator of any responses from transit countries.

(vii) For exports to OECD Member countries, the receiving country may
respond to the notification using tacit consent. If no objection has
been lodged by any receiving country or transit countries to a
notification provided pursuant to paragraph (i) of this section within
thirty (30) days after the date of issuance of the acknowledgement of
receipt of notification by the competent authority of the receiving
country, the transboundary movement may commence. In such cases, EPA
will send an Acknowledgment of Consent to inform the hazardous secondary
material generator that the receiving country and any relevant transit
countries have not objected to the shipment, and are thus presumed to
have consented tacitly. Tacit consent expires one (1) calendar year
after the close of the thirty (30) day period; renotification and
renewal of all consents is required for exports after that date.

(viii)  A copy of the Acknowledgment of Consent must accompany the
shipment. The shipment must conform to the terms of the Acknowledgment
of Consent.

(ix)  If a shipment cannot be delivered for any reason to the reclaimer,
intermediate facility or the alternate reclaimer or alternate
intermediate facility, the hazardous secondary material generator must
re-notify EPA of a change in the conditions of the original notification
to allow shipment to a new reclaimer in accordance with paragraph (iii)
of this section and obtain another Acknowledgment of Consent.

(x) Hazardous secondary material generators must keep a copy of each
notification of intent to export and each Acknowledgment of Consent for
a period of three years following receipt of the Acknowledgment of
Consent.

(xi) Hazardous secondary material generators must file with the
Administrator no later than March 1 of each year, a report summarizing
the types, quantities, frequency and ultimate destination of all
hazardous secondary materials exported during the previous calendar
year. Annual reports submitted by mail should be sent to the following
address: Office of Enforcement and Compliance Assurance, Office of
Federal Activities, International Compliance Assurance Division (Mail
Code 2254A), Environmental Protection Agency, 1200 Pennsylvania Ave.,
NW., Washington, DC 20460. Hand-delivered reports should be delivered
to: Office of Enforcement and Compliance Assurance, Office of Federal
Activities, International Compliance Assurance, Office of Federal
Activities, International Compliance Assurance Division, Environmental
Protection Agency, Arial Rios Bldg., Room 6144, 12th St. and
Pennsylvania Ave., NW., Washington, D.C. 20004. Such reports must
include the following information:

(A) Name, mailing and site address, and EPA ID number (if applicable) of
the hazardous secondary material generator;

(B) The calendar year covered by the report;

(C) The name and site address of each reclaimer and intermediate
facility;

(D) By reclaimer and intermediate facility, for each hazardous secondary
material exported, a description of the hazardous secondary material,
the type of hazardous secondary material (reported as the EPA hazardous
waste number that would apply if the hazardous secondary material was
managed as hazardous waste), DOT hazard class, the name and US EPA ID
number (where applicable) for each transporter used, the total amount of
hazardous secondary material shipped and the number of shipments
pursuant to each notification;

(E) A certification signed by the hazardous secondary material generator
which states: I certify under penalty of law that I have personally
examined and am familiar with the information submitted in this and all
attached documents, and that based on my inquiry of those individuals
immediately responsible for obtaining the information, I believe that
the submitted information is true, accurate, and complete. I am aware
that there are significant penalties for submitting false information
including the possibility of fine and imprisonment.

(xii) All persons claiming an exclusion under this paragraph (a)(25)
must provide notification as required by §260.42.

11. Part 261 Subpart F and Subpart G have been reserved.

12. Part 261 has been amended by adding new Subpart H to read as
follows:

PART 261

Subpart H—Financial Requirements for Management of Excluded Hazardous
Secondary Materials

§261.140  Applicability.

(a) The requirements of this subpart apply to owners or operators of
reclamation and intermediate facilities managing hazardous secondary
materials excluded under 40 CFR §261.4(a)(24), except as provided
otherwise in this section.

(b) States and the Federal government are exempt from the financial
assurance requirements of this subpart.

§261.141  Definitions of terms as used in this subpart.

The terms defined in §265.141(d),(f),(g), and (h) have the same meaning
in this subpart as they do in §265.141.

§261.142  Cost estimate

    (a) The owner or operator must have a detailed written estimate, in
current dollars, of the cost of disposing of any hazardous secondary
material as listed or characteristic hazardous waste, and the potential
cost of closing the facility as a treatment, storage, and disposal
facility.

    (1) The estimate must equal the cost of conducting the activities
described in paragraph (a) at the point when the extent and manner of
the facility’s operation would make these activities the most
expensive; and

    (2) The cost estimate must be based on the costs to the owner or
operator of hiring a third party to conduct these activities. A third
party is a party who is neither a parent nor a subsidiary of the owner
or operator. (See definition of parent corporation in §265.141(d).) The
owner or operator may use costs for on-site disposal in accordance with
applicable requirements if he can demonstrate that on-site disposal
capacity will exist at all times over the life of the facility.

    (3) The cost estimate may not incorporate any salvage value that may
be realized with the sale of hazardous secondary materials, or hazardous
or non-hazardous wastes if applicable under 265.5113(d), facility
structures or equipment, land, or other assets associated with the
facility.

    (4) The owner or operator may not incorporate a zero cost for
hazardous secondary materials, or hazardous or non-hazardous wastes if
applicable under 265.5113(d) that might have economic value.

    (b) During the active life of the facility, the owner or operator
must adjust the cost estimate for inflation within 60 days prior to the
anniversary date of the establishment of the financial instrument(s)
used to comply with Sec. 261.143. For owners and operators using the
financial test or corporate guarantee, the cost estimate must be updated
for inflation within 30 days after the close of the firm's fiscal year
and before submission of updated information to the Regional
Administrator as specified in Sec. 261.143(e)(3). The adjustment may be
made by recalculating the cost estimate in current dollars, or by using
an inflation factor derived from the most recent Implicit Price Deflator
for Gross National Product published by the U.S. Department of Commerce
in its Survey of Current Business, as specified in paragraphs (b)(1) and
(2) of this section. The inflation factor is the result of dividing the
latest published annual Deflator by the Deflator for the previous year.

    (1) The first adjustment is made by multiplying the cost estimate by
the inflation factor. The result is the adjusted cost estimate.

    (2) Subsequent adjustments are made by multiplying the latest
adjusted cost estimate by the latest inflation factor.

    (c) During the active life of the facility, the owner or operator
must revise the cost estimate no later than 30 days after a change in a
facility’s operating plan or design that would increase the costs of
conducting the activities described in paragraph (a) or no later that 60
days after an unexpected event which increases the cost of conducting
the activities described in paragraph (a).The revised cost estimate must
be adjusted for inflation as specified in paragraph (b).

    (d) The owner or operator must keep the following at the facility
during the operating life of the facility: The latest cost estimate
prepared in accordance with paragraphs (a) and (c) and, when this
estimate has been adjusted in accordance with paragraph (b), the latest
adjusted cost estimate.

§261.143  Financial assurance condition

Per §261.4(a)(24)(v)(F), an owner or operator of a reclamation or
intermediate facility must have financial assurance as a condition of
the exclusion as required  under §261.4(a)(24).  He must choose from
the options as specified in paragraphs (a) through (e) of this section.

(a) Trust fund.  (1) An owner or operator may satisfy the requirements
of this section by establishing a trust fund which conforms to the
requirements of this paragraph and submitting an originally signed
duplicate of the trust agreement to the Regional Administrator.  The
trustee must be an entity which has the authority to act as a trustee
and whose trust operations are regulated and examined by a Federal or
State agency.

(2) The wording of the trust agreement must be identical to the wording
specified in §261.151(a)(1), and the trust agreement must be
accompanied by a formal certification of acknowledgment (for example,
see §261.151(a)(2)).  Schedule A of the trust agreement must be updated
within 60 days after a change in the amount of the current cost estimate
covered by the agreement.

(3) The trust fund must be funded for the full amount of the current
cost estimate before it may be relied upon to satisfy the requirements
of this section.

 (4)  Whenever the current cost estimate changes, the owner or operator
must compare the new estimate with the trustee's most recent annual
valuation of the trust fund.  If the value of the fund is less than the
amount of the new estimate, the owner or operator, within 60 days after
the change in the cost estimate, must either deposit an amount into the
fund so that its value after this deposit at least equals the amount of
the current cost estimate, or obtain other financial assurance as
specified in this section to cover the difference.

(5) If the value of the trust fund is greater than the total amount of
the current cost estimate, the owner or operator may submit a written
request to the Regional Administrator for release of the amount in
excess of the current cost estimate.

(6) If an owner or operator substitutes other financial assurance as
specified in this section for all or part of the trust fund, he may
submit a written request to the Regional Administrator for release of
the amount in excess of the current cost estimate covered by the trust
fund.

(7) Within 60 days after receiving a request from the owner or operator
for release of funds as specified in paragraph (a) (5) or (6) of this
section, the Regional Administrator will instruct the trustee to release
to the owner or operator such funds as the Regional Administrator
specifies in writing.  If the owner or operator begins final closure
under subpart G of 40 CFR part 264 or 265, an owner or operator may
request reimbursements for partial or final closure expenditures by
submitting itemized bills to the Regional Administrator. The owner or
operator may request reimbursements for partial closure only if
sufficient funds are remaining in the trust fund to cover the maximum
costs of closing the facility over its remaining operating life. No
later than 60 days after receiving bills for partial or final closure
activities, the Regional Administrator will instruct the trustee to make
reimbursements in those amounts as the Regional Administrator specifies
in writing, if the Regional Administrator determines that the partial or
final closure expenditures are in accordance with the approved closure
plan, or otherwise justified. If the Regional Administrator has reason
to believe that the maximum cost of closure over the remaining life of
the facility will be significantly greater than the value of the trust
fund, he may withhold reimbursements of such amounts as he deems prudent
until he determines, in accordance with Sec. 265.143(i) that the owner
or operator is no longer required to maintain financial assurance for
final closure of the facility. If the Regional Administrator does not
instruct the trustee to make such reimbursements, he will provide to the
owner or operator a detailed written statement of reasons.

(8) The Regional Administrator will agree to termination of the trust
when:

(i) An owner or operator substitutes alternate financial assurance as
specified in this section; or

(ii) The Regional Administrator releases the owner or operator from the
requirements of this section in accordance with §261.143(i).

(b) Surety bond guaranteeing payment into a trust fund.  (1) An owner or
operator may satisfy the requirements of this section by obtaining a
surety bond which conforms to the requirements of this paragraph and
submitting the bond to the Regional Administrator.  The surety company
issuing the bond must, at a minimum, be among those listed as acceptable
sureties on Federal bonds in Circular 570 of the U.S. Department of the
Treasury.

(2) The wording of the surety bond must be identical to the wording
specified in §261.151(b).

(3) The owner or operator who uses a surety bond to satisfy the
requirements of this section must also establish a standby trust fund.
Under the terms of the bond, all payments made thereunder will be
deposited by the surety directly into the standby trust fund in
accordance with instructions from the Regional Administrator.  This
standby trust fund must meet the requirements specified in §261.143(a),
except that:

(i) An originally signed duplicate of the trust agreement must be
submitted to the Regional Administrator with the surety bond; and

(ii) Until the standby trust fund is funded pursuant to the requirements
of this section, the following are not required by these regulations:

(A) Payments into the trust fund as specified in §261.143(a);

(B) Updating of Schedule A of the trust agreement (see §261.151(a)) to
show current cost estimates;

(C) Annual valuations as required by the trust agreement; and

(D) Notices of nonpayment as required by the trust agreement.

(4) The bond must guarantee that the owner or operator will:

(i) Fund the standby trust fund in an amount equal to the penal sum of
the bond before loss of the exclusion under §261.4(a)(24) or

(ii) Fund the standby trust fund in an amount equal to the penal sum
within 15 days after an administrative order to begin closure issued by
the Regional Administrator becomes final, or within 15 days after an
order to begin closure is issued by a U.S. district court or other court
of competent jurisdiction; or

(iii) Provide alternate financial assurance as specified in this
section, and obtain the Regional Administrator's written approval of the
assurance provided, within 90 days after receipt by both the owner or
operator and the Regional Administrator of a notice of cancellation of
the bond from the surety.

(5) Under the terms of the bond, the surety will become liable on the
bond obligation when the owner or operator fails to perform as
guaranteed by the bond.

(6) The penal sum of the bond must be in an amount at least equal to the
current cost estimate, except as provided in § 261.143(f).

(7) Whenever the current cost estimate increases to an amount greater
than the penal sum, the owner or operator, within 60 days after the
increase, must either cause the penal sum to be increased to an amount
at least equal to the current cost estimate and submit evidence of such
increase to the Regional Administrator, or obtain other financial
assurance as specified in this section to cover the increase.  Whenever
the current cost estimate decreases, the penal sum may be reduced to the
amount of the current cost estimate following written approval by the
Regional Administrator.

(8) Under the terms of the bond, the surety may cancel the bond by
sending notice of cancellation by certified mail to the owner or
operator and to the Regional Administrator.  Cancellation may not occur,
however, during the 120 days beginning on the date of receipt of the
notice of cancellation by both the owner or operator and the Regional
Administrator, as evidenced by the return receipts.

(9) The owner or operator may cancel the bond if the Regional
Administrator has given prior written consent based on his receipt of
evidence of alternate financial assurance as specified in this section.

(c) Letter of credit.  (1) An owner or operator may satisfy the
requirements of this section by obtaining an irrevocable standby letter
of credit which conforms to the requirements of this paragraph and
submitting the letter to the Regional Administrator.  The issuing
institution must be an entity which has the authority to issue letters
of credit and whose letter-of-credit operations are regulated and
examined by a Federal or State agency.

(2) The wording of the letter of credit must be identical to the wording
specified in §261.151(c).

(3) An owner or operator who uses a letter of credit to satisfy the
requirements of this section must also establish a standby trust fund.
Under the terms of the letter of credit, all amounts paid pursuant to a
draft by the Regional Administrator will be deposited by the issuing
institution directly into the standby trust fund in accordance with
instructions from the Regional Administrator.  This standby trust fund
must meet the requirements of the trust fund specified in
§ 261.143(a), except that:

(i)  An originally signed duplicate of the trust agreement must be
submitted to the Regional Administrator with the letter of credit; and

(ii) Unless the standby trust fund is funded pursuant to the
requirements of this section, the following are not required by these
regulations:

(A) Payments into the trust fund as specified in § 261.143(a);

(B) Updating of Schedule A of the trust agreement (see §261.151(a)) to
show current cost estimates;

(C) Annual valuations as required by the trust agreement; and

(D) Notices of nonpayment as required by the trust agreement.

(4) The letter of credit must be accompanied by a letter from the owner
or operator referring to the letter of credit by number, issuing
institution, and date, and providing the following information: The EPA
Identification Number (if any issued), name, and address of the
facility, and the amount of funds assured for the facility by the letter
of credit.

(5) The letter of credit must be irrevocable and issued for a period of
at least 1 year.  The letter of credit must provide that the expiration
date will be automatically extended for a period of at least 1 year
unless, at least 120 days before the current expiration date, the
issuing institution notifies both the owner or operator and the Regional
Administrator by certified mail of a decision not to extend the
expiration date.  Under the terms of the letter of credit, the 120 days
will begin on the date when both the owner or operator and the Regional
Administrator have received the notice, as evidenced by the return
receipts.

(6) The letter of credit must be issued in an amount at least equal to
the current cost estimate, except as provided in §261.143(f).

(7) Whenever the current cost estimate increases to an amount greater
than the amount of the credit, the owner or operator, within 60 days
after the increase, must either cause the amount of the credit to be
increased so that it at least equals the current cost estimate and
submit evidence of such increase to the Regional Administrator, or
obtain other financial assurance as specified in this section to cover
the increase.  Whenever the current cost estimate decreases, the amount
of the credit may be reduced to the amount of the current cost estimate
following written approval by the Regional Administrator.

(8) Following a determination by the Regional Administrator that the
hazardous secondary materials do not meet the conditions of the
exclusion under §261.4(a)(24), the Regional Administrator may draw on
the letter of credit.

(9) If the owner or operator does not establish alternate financial
assurance as specified in this section and obtain written approval of
such alternate assurance from the Regional Administrator within 90 days
after receipt by both the owner or operator and the Regional
Administrator of a notice from the issuing institution that it has
decided not to extend the letter of credit beyond the current expiration
date,  the Regional Administrator will draw on the letter of credit.
The Regional Administrator may delay the drawing if the issuing
institution grants an extension of the term of the credit.  During the
last 30 days of any such extension the Regional Administrator will draw
on the letter of credit if the owner or operator has failed to provide
alternate financial assurance as specified in this section and obtain
written approval of such assurance from the Regional Administrator.

(10) The Regional Administrator will return the letter of credit to the
issuing institution for termination when:

(i) An owner or operator substitutes alternate financial assurance as
specified in this section; or

(ii) The Regional Administrator releases the owner or operator from the
requirements of this section in accordance with §261.143(i).

(d) Insurance.  (1) An owner or operator may satisfy the requirements of
this section by obtaining insurance which conforms to the requirements
of this paragraph and submitting a certificate of such insurance to the
Regional Administrator   At a minimum, the insurer must be licensed to
transact the business of insurance, or eligible to provide insurance as
an excess or surplus lines insurer, in one or more States.

(2) The wording of the certificate of insurance must be identical to the
wording specified in §261.151(d).

(3) The insurance policy must be issued for a face amount at least equal
to the current cost estimate, except as provided in §261.143(f).  The
term ``face amount'' means the total amount the insurer is obligated to
pay under the policy.  Actual payments by the insurer will not change
the face amount, although the insurer's future liability will be lowered
by the amount of the payments.

(4) The insurance policy must guarantee that funds will be available
whenever needed to pay the cost of removal of all hazardous secondary
materials from the unit, to pay the cost of decontamination of the unit,
to pay the costs of the performance of activities required under subpart
G of 40 CFR parts 264 or 265, as applicable, for the facilities covered
by this policy.  The policy must also guarantee that once funds are
needed, the insurer will be responsible for paying out funds, up to an
amount equal to the face amount of the policy, upon the direction of the
Regional Administrator, to such party or parties as the Regional
Administrator specifies.

(5) After beginning partial or final closure under 40 CFR parts 264 or
265, as applicable,  an owner or operator or any other authorized person
may request reimbursements for closure expenditures by submitting
itemized bills to the Regional Administrator.  The owner or operator may
request reimbursements only if the remaining value of the policy is
sufficient to cover the maximum costs of closing the facility over its
remaining operating life.  Within 60 days after receiving bills for
closure activities, the Regional Administrator will instruct the insurer
to make reimbursements in such amounts as the Regional Administrator
specifies in writing if the Regional Administrator determines that the
expenditures are in accordance with the approved plan or otherwise
justified.  If the Regional Administrator has reason to believe that the
maximum cost over the remaining life of the facility will be
significantly greater than the face amount of the policy, he may
withhold reimbursement of such amounts as he deems prudent until he
determines, in accordance with § 261.143(h), that the owner or
operator is no longer required to maintain financial assurance for the
particular facility.  If the Regional Administrator does not instruct
the insurer to make such reimbursements, he will provide to the owner or
operator a detailed written statement of reasons.

(6) The owner or operator must maintain the policy in full force and
effect until the Regional Administrator consents to termination of the
policy by the owner or operator as specified in paragraph (i)(10) of
this section.  Failure to pay the premium, without substitution of
alternate financial assurance as specified in this section, will
constitute a significant violation of these regulations warranting such
remedy as the Regional Administrator deems necessary.  Such violation
will be deemed to begin upon receipt by the Regional Administrator of a
notice of future cancellation, termination, or failure to renew due to
nonpayment of the premium, rather than upon the date of expiration.

(7) Each policy must contain a provision allowing assignment of the
policy to a successor owner or operator.  Such assignment may be
conditional upon consent of the insurer, provided such consent is not
unreasonably refused.

(8) The policy must provide that the insurer may not cancel, terminate,
or fail to renew the policy except for failure to pay the premium.  The
automatic renewal of the policy must, at a minimum, provide the insured
with the option of renewal at the face amount of the expiring policy.
If there is a failure to pay the premium, the insurer may elect to
cancel, terminate, or fail to renew the policy by sending notice by
certified mail to the owner or operator and the Regional Administrator.
Cancellation, termination, or failure to renew may not occur, however,
during the 120 days beginning with the date of receipt of the notice by
both the Regional Administrator and the owner or operator, as evidenced
by the return receipts.  Cancellation, termination, or failure to renew
may not occur and the policy will remain in full force and effect in the
event that on or before the date of expiration:

(i) The Regional Administrator deems the facility abandoned; or

(ii) Conditional exclusion or interim status is lost, terminated, or
revoked; or

(iii) Closure is ordered by the Regional Administrator or a U.S.
district court or other court of competent jurisdiction; or

(iv) The owner or operator is named as debtor in a voluntary or
involuntary proceeding under Title 11 (Bankruptcy), U.S. Code; or

(v) The premium due is paid.

(9) Whenever the current cost estimate increases to an amount greater
than the face amount of the policy, the owner or operator, within 60
days after the increase, must either cause the face amount to be
increased to an amount at least equal to the current cost estimate and
submit evidence of such increase to the Regional Administrator, or
obtain other financial assurance as specified in this section to cover
the increase.  Whenever the current cost estimate decreases, the face
amount may be reduced to the amount of the current cost estimate
following written approval by the Regional Administrator.

(10) The Regional Administrator will give written consent to the owner
or operator that he may terminate the insurance policy when:

(i) An owner or operator substitutes alternate financial assurance as
specified in this section; or

(ii) The Regional Administrator releases the owner or operator from the
requirements of this section in accordance with §261.143(i).

(e) Financial test and corporate guarantee.  (1) An owner or operator
may satisfy the requirements of this section by demonstrating that he
passes a financial test as specified in this paragraph.  To pass this
test the owner or operator must meet the criteria of either paragraph
(e)(1)(i) or (ii) of this section:

(i) The owner or operator must have:

(A) Two of the following three ratios: A ratio of total liabilities to
net worth less than 2.0; a ratio of the sum of net income plus
depreciation, depletion, and amortization to total liabilities greater
than 0.1; and a ratio of current assets to current liabilities greater
than 1.5; and

(B) Net working capital and tangible net worth each at least six times
the sum of the current cost estimates and the current plugging and
abandonment cost estimates; and

(C) Tangible net worth of at least $10 million; and

(D) Assets located in the United States amounting to at least 90 percent
of total assets or at least six times the sum of the current cost
estimates and the current plugging and abandonment cost estimates.

(ii) The owner or operator must have:

(A) A current rating for his most recent bond issuance of AAA, AA, A, or
BBB as issued by Standard and Poor's or Aaa, Aa, A, or Baa as issued by
Moody's; and

(B) Tangible net worth at least six times the sum of the current cost
estimates and the current plugging and abandonment cost estimates; and

(C) Tangible net worth of at least $10 million; and

(D) Assets located in the United States amounting to at least 90 percent
of total assets or at least six times the sum of the current cost
estimates and the current plugging and abandonment cost estimates.

(2) The phrase ``current cost estimates'' as used in paragraph (e)(1) of
this section refers to the cost estimates required to be shown in
paragraphs 1-4 of the letter from the owner's or operator's chief
financial officer (§261.151(e)).  The phrase ``current plugging and
abandonment cost estimates'' as used in paragraph (e)(1) of this section
refers to the cost estimates required to be shown in paragraphs 1-4 of
the letter from the owner's or operator's chief financial officer
(§ 144.70(f) of this title).

(3) To demonstrate that he meets this test, the owner or operator must
submit the following items to the Regional Administrator:

(i) A letter signed by the owner's or operator's chief financial officer
and worded as specified in §261.151(e); and

(ii) A copy of the independent certified public accountant's report on
examination of the owner's or operator's financial statements for the
latest completed fiscal year; and

(iii) If the chief financial officer’s letter providing evidence of
financial assurance includes financial data showing that the owner or
operator satisfies paragraph (e)(1)(i)of this section that are different
from the data in the audited financial statements referred to in
paragraph (e)(3)(ii)of this section or any other audited financial
statement or data filed with the SEC, then a special report from the
owner’s or operator’s independent certified public accountant to the
owner or operator is required. The special report shall be based upon an
agreed upon procedures engagement in accordance with professional
auditing standards and shall describe the procedures performed in
comparing the data in the chief financial officer’s letter derived
from the independently audited, year-end financial statements for the
latest fiscal year with the amounts in such financial statements, the
findings of the comparison, and the reasons for any differences.

 (4) The owner or operator may obtain an extension of the time allowed
for submission of the documents specified in paragraph (e)(3) of this
section if the fiscal year of the owner or operator ends during the 90
days prior to the effective date of these regulations and if the
year-end financial statements for that fiscal year will be audited by an
independent certified public accountant. The extension will end no later
than 90 days after the end of the owner's or operator's fiscal year. To
obtain the extension, the owner's or operator's chief financial officer
must send, by the effective date of these regulations, a letter to the
Regional Administrator of each Region in which the owner's or operator's
facilities to be covered by the financial test are located.  This letter
from the chief financial officer must:

(i) Request the extension;

(ii) Certify that he has grounds to believe that the owner or operator
meets the criteria of the financial test;

(iii) Specify for each facility to be covered by the test the EPA
Identification Number (if any issued), name, address, and current cost
estimates to be covered by the test;

(iv) Specify the date ending the owner's or operator's last complete
fiscal year before the effective date of these regulations;

(v) Specify the date, no later than 90 days after the end of such fiscal
year, when he will submit the documents specified in paragraph (e)(3) of
this section; and

(vi) Certify that the year-end financial statements of the owner or
operator for such fiscal year will be audited by an independent
certified public accountant.

(5) After the initial submission of items specified in paragraph (e)(3)
of this section, the owner or operator must send updated information to
the Regional Administrator within 90 days after the close of each
succeeding fiscal year. This information must consist of all three items
specified in paragraph (e)(3) of this section.

(6) If the owner or operator no longer meets the requirements of
paragraph (e)(1) of this section, he must send notice to the Regional
Administrator of intent to establish alternate financial assurance as
specified in this section. The notice must be sent by certified mail
within 90 days after the end of the fiscal year for which the year-end
financial data show that the owner or operator no longer meets the
requirements. The owner or operator must provide the alternate financial
assurance within 120 days after the end of such fiscal year.

(7) The Regional Administrator may, based on a reasonable belief that
the owner or operator may no longer meet the requirements of paragraph
(e)(1) of this section, require reports of financial condition at any
time from the owner or operator in addition to those specified in
paragraph (e)(3) of this section. If the Regional Administrator finds,
on the basis of such reports or other information, that the owner or
operator no longer meets the requirements of paragraph (e)(1) of this
section, the owner or operator must provide alternate financial
assurance as specified in this section within 30 days after notification
of such a finding.

(8) The Regional Administrator may disallow use of this test on the
basis of qualifications in the opinion expressed by the independent
certified public accountant in his report on examination of the owner's
or operator's financial statements (see paragraph (e)(3)(ii) of this
section).  An adverse opinion or a disclaimer of opinion will be cause
for disallowance.  The Regional Administrator will evaluate other
qualifications on an individual basis.  The owner or operator must
provide alternate financial assurance as specified in this section
within 30 days after notification of the disallowance.

 (9) The owner or operator is no longer required to submit the items
specified in paragraph (e)(3) of this section when:

(i) An owner or operator substitutes alternate financial assurance as
specified in this section; or

(ii) The Regional Administrator releases the owner or operator from the
requirements of this section in accordance with §261.143(i).

(10) An owner or operator may meet the requirements of this section by
obtaining a written guarantee.  The guarantor must be the direct or
higher-tier parent corporation of the owner or operator, a firm whose
parent corporation is also the parent corporation of the owner or
operator, or a firm with a ``substantial business relationship'' with
the owner or operator.  The guarantor must meet the requirements for
owners or operators in paragraphs (e)(1) through (8) of this section and
must comply with the terms of the guarantee.  The wording of the
guarantee must be identical to the wording specified in §261.151(g)(1).
  A certified copy of the guarantee must accompany the items sent to the
Regional Administrator as specified in paragraph (e)(3) of this section.
 One of these items must be the letter from the guarantor's chief
financial officer.  If the guarantor's parent corporation is also the
parent corporation of the owner or operator, the letter must describe
the value received in consideration of the guarantee.  If the guarantor
is a firm with a ``substantial business relationship'' with the owner or
operator, this letter must describe this ``substantial business
relationship'' and the value received in consideration of the guarantee.
 The terms of the guarantee must provide that:

(i) Following a determination by the Regional Administrator that the
hazardous secondary materials at the owner or operator’s facility
covered by this guarantee do not meet the conditions of the exclusion
under §261.4(a)(24), the guarantor will dispose of any hazardous
secondary material as hazardous waste and close the facility in
accordance with closure requirements found in parts 264 or 265 of this
chapter, as applicable,  or establish a trust fund as specified in
§ 261.143(a) in the name of the owner or operator in the amount of the
current cost estimate.

(ii) The corporate guarantee will remain in force unless the guarantor
sends notice of cancellation by certified mail to the owner or operator
and to the Regional Administrator.  Cancellation may not occur, however,
during the 120 days beginning on the date of receipt of the notice of
cancellation by both the owner or operator and the Regional
Administrator, as evidenced by the return receipts.

(iii) If the owner or operator fails to provide alternate financial
assurance as specified in this section and obtain the written approval
of such alternate assurance from the Regional Administrator within 90
days after receipt by both the owner or operator and the Regional
Administrator of a notice of cancellation of the corporate guarantee
from the guarantor, the guarantor will provide such alternate financial
assurance in the name of the owner or operator.

(f) Use of multiple financial mechanisms.  An owner or operator may
satisfy the requirements of this section by establishing more than one
financial mechanism per facility.  These mechanisms are limited to trust
funds, surety bonds, letters of credit, and insurance.  The mechanisms
must be as specified in paragraphs (a) through (d), respectively, of
this section, except that it is the combination of mechanisms, rather
than the single mechanism, which must provide financial assurance for an
amount at least equal to the current cost estimate.  If an owner or
operator uses a trust fund in combination with a surety bond or a letter
of credit, he may use the trust fund as the standby trust fund for the
other mechanisms.  A single standby trust fund may be established for
two or more mechanisms.  The Regional Administrator may use any or all
of the mechanisms to provide for the facility.

(g) Use of a financial mechanism for multiple facilities.  An owner or
operator may use a financial assurance mechanism specified in this
section to meet the requirements of this section for more than one
facility.  Evidence of financial assurance submitted to the Regional
Administrator must include a list showing, for each facility, the EPA
Identification Number (if any issued), name, address, and the amount of
funds assured by the mechanism.  If the facilities covered by the
mechanism are in more than one Region, identical evidence of financial
assurance must be submitted to and maintained with the Regional
Administrators of all such Regions.  The amount of funds available
through the mechanism must be no less than the sum of funds that would
be available if a separate mechanism had been established and maintained
for each facility.  In directing funds available through the mechanism
for any of the facilities covered by the mechanism, the Regional
Administrator may direct only the amount of funds designated for that
facility, unless the owner or operator agrees to the use of additional
funds available under the mechanism

(h) Removal and Decontamination Plan for Release (1) An owner or
operator of a reclamation facility or an intermediate facility who
wishes to be released from his financial assurance obligations under
§261.4(a)(24)(v)(F) must submit a plan for removing all hazardous
secondary material residues to the Regional Administrator at least 180
days prior to the date on which he expects to cease to operate under the
exclusion.

(2) The plan must include, at least:

(A) For each hazardous secondary materials storage unit subject to
financial assurance requirements under §261.4(a)(24)(v)(F), a
description of how all excluded hazardous secondary materials will be
recycled or sent for recycling, and how all residues, contaminated
containment systems (liners, etc), contaminated soils, subsoils,
structures, and equipment will be removed or decontaminated as necessary
to protect human health and the environment, and

(B) A detailed description of the steps necessary to remove or
decontaminate all hazardous secondary material residues and contaminated
containment system components, equipment, structures, and soils
including, but not limited to, procedures for cleaning equipment and
removing contaminated soils, methods for sampling and testing
surrounding soils, and criteria for determining the extent of
decontamination necessary to protect human health and the environment;
and

(C) A detailed description of any other activities necessary to protect
human health and the environment during this timeframe, including, but
not limited to, leachate collection, run-on and run-off control, etc;
and

(D) A schedule for conducting the activities described which, at a
minimum, includes the total time required to remove all excluded
hazardous secondary materials for recycling and decontaminate all units
subject to financial assurance under §261.4(a)(24)(v)(F) and the time
required for intervening activities which will allow tracking of the
progress of decontamination.

(3) The Regional Administrator will provide the owner or operator and
the public, through a newspaper notice, the opportunity to submit
written comments on the plan and request modifications to the plan no
later than 30 days from the date of the notice. He will also, in
response to a request or at his discretion, hold a public hearing
whenever such a hearing might clarify one or more issues concerning the
plan. The Regional Administrator will give public notice of the hearing
at least 30 days before it occurs. (Public notice of the hearing may be
given at the same time as notice of the opportunity for the public to
submit written comments, and the two notices may be combined.)   The
Regional Administrator will approve, modify, or disapprove the plan
within 90 days of its receipt. If the Regional Administrator does not
approve the plan, he shall provide the owner or operator with a detailed
written statement of reasons for the refusal and the owner or operator
must modify the plan or submit a new plan for approval within 30 days
after receiving such written statement. The Regional Administrator will
approve or modify this plan in writing within 60 days. If the Regional
Administrator modifies the plan, this modified plan becomes the approved
plan. The Regional Administrator must assure that the approved plan is
consistent with §261.  A copy of the modified plan with a detailed
statement of reasons for the modifications must be mailed to the owner
or operator.

(4).    Within 60 days of completion of the activities described for
each hazardous secondary materials management unit, the owner or
operator must submit to the Regional Administrator, by registered mail,
a certification that all hazardous secondary materials have been removed
from the unit and the unit has been decontaminated in accordance with
the specifications in the approved plan. The certification must be
signed by the owner or operator and by a qualified Professional
Engineer. Documentation supporting the Professional Engineer's
certification must be furnished to the Regional Administrator, upon
request, until he releases the owner or operator from the financial
assurance requirements for §261.4(a)(24)(v)(F).

(i) Release of the owner or operator from the requirements of this
section. Within 60 days after receiving certifications from the owner or
operator and a qualified Professional Engineer that all hazardous
secondary materials have been removed from the facility or a unit at the
facility  and the facility or a unit  has been decontaminated in
accordance with the approved plan per paragraph (h), the Regional
Administrator will notify the owner or operator in writing that he is no
longer required under §261.4(a)(24)(v)(F) to maintain financial
assurance for that facility or a unit at the facility, unless the
Regional Administrator has reason to believe that that all hazardous
secondary materials have not been removed from the facility or unit at a
facility or that the facility or unit has not been decontaminated in
accordance with the approved plan. The Regional Administrator shall
provide the owner or operator a detailed written statement of any such
reason to believe that all hazardous secondary materials have not been
removed from the unit or that the unit has not been decontaminated in
accordance with the approved plan.

§261.144  (reserved).

§261.145  (reserved)

§261.146  (reserved)

§261.147 Liability requirements.

(a) Coverage for sudden accidental occurrences. An owner or operator of
a hazardous secondary material reclamation facility or an intermediate
facility subject to financial assurance requirements under
§261.4(a)(24)(v)(F), or a group of such facilities, must demonstrate
financial responsibility for bodily injury and property damage to third
parties caused by sudden accidental occurrences arising from operations
of the facility or group of facilities. The owner or operator must have
and maintain liability coverage for sudden accidental occurrences in the
amount of at least $1 million per occurrence with an annual aggregate of
at least $2 million, exclusive of legal defense costs. This liability
coverage may be demonstrated as specified in paragraphs (a) (1), (2),
(3), (4), (5), or (6) of this section:

(1) An owner or operator may demonstrate the required liability coverage
by having liability insurance as specified in this paragraph.

(i) Each insurance policy must be amended by attachment of the Hazardous
Secondary Material Facility Liability Endorsement, or evidenced by a
Certificate of Liability Insurance.  The wording of the endorsement must
be identical to the wording specified in §261.151(h).  The wording of
the certificate of insurance must be identical to the wording specified
in § 261.151(i).  The owner or operator must submit a signed duplicate
original of the endorsement or the certificate of insurance to the
Regional Administrator, or Regional Administrators if the facilities are
located in more than one Region.  If requested by a Regional
Administrator, the owner or operator must provide a signed duplicate
original of the insurance policy.

(ii) Each insurance policy must be issued by an insurer which, at a
minimum, is licensed to transact the business of insurance, or eligible
to provide insurance as an excess or surplus lines insurer, in one or
more States.

(2) An owner or operator may meet the requirements of this section by
passing a financial test or using the guarantee for liability coverage
as specified in paragraphs (f) and (g) of this section.

(3) An owner or operator may meet the requirements of this section by
obtaining a letter of credit for liability coverage as specified in
paragraph (h) of this section.

(4) An owner or operator may meet the requirements of this section by
obtaining a surety bond for liability coverage as specified in paragraph
(i) of this section.

(5) An owner or operator may meet the requirements of this section by
obtaining a trust fund for liability coverage as specified in paragraph
(j) of this section.

(6) An owner or operator may demonstrate the required liability coverage
through the use of combinations of insurance, financial test, guarantee,
letter of credit, surety bond, and trust fund, except that the owner or
operator may not combine a financial test covering part of the liability
coverage requirement with a guarantee unless the financial statement of
the owner or operator is not consolidated with the financial statement
of the guarantor.

The amounts of coverage demonstrated must total at least the minimum
amounts required by this section.  If the owner or operator demonstrates
the required coverage through the use of a combination of financial
assurances under this paragraph, the owner or operator shall specify at
least one such assurance as ``primary'' coverage and shall specify other
assurance as ``excess'' coverage.

 (7) An owner or operator shall notify the Regional Administrator in
writing within 30 days whenever:

(i) A claim results in a reduction in the amount of financial assurance
for liability coverage provided by a financial instrument authorized in
paragraphs (a)(1) through (a)(6) of this section; or

(ii) A Certification of Valid Claim for bodily injury or property
damages caused by a sudden or non-sudden accidental occurrence arising
from the operation of a hazardous secondary material reclamation
facility or intermediate facility is entered between the owner or
operator and third-party claimant for liability coverage under
paragraphs (a)(1) through (a)(6) of this section; or

(iii) A final court order establishing a judgment for bodily injury or
property damage caused by a sudden or non-sudden accidental occurrence
arising from the operation of a hazardous secondary material reclamation
facility or intermediate facility is issued against the owner or
operator or an instrument that is providing financial assurance for
liability coverage under paragraphs (a)(1) through (a)(6) of this
section.

(b) Coverage for nonsudden accidental occurrences. An owner or operator
of a hazardous secondary material reclamation facility or intermediate
facility with land-based units, as defined in §260.10, which are used
to manage hazardous secondary materials excluded under §261.4(a)(24) or
a group of such facilities, must demonstrate financial responsibility
for bodily injury and property damage to third parties caused by
nonsudden accidental occurrences arising from operations of the facility
or group of facilities. The owner or operator must have and maintain
liability coverage for nonsudden accidental occurrences in the amount of
at least $3 million per occurrence with an annual aggregate of at least
$6 million, exclusive of legal defense costs. An owner or operator who
must meet the requirements of this section may combine the required
per-occurrence coverage levels for sudden and nonsudden accidental
occurrences into a single per-occurrence level, and combine the required
annual aggregate coverage levels for sudden and nonsudden accidental
occurrences into a single annual aggregate level. Owners or operators
who combine coverage levels for sudden and nonsudden accidental
occurrences must maintain liability coverage in the amount of at least
$4 million per occurrence and $8 million annual aggregate. This
liability coverage may be demonstrated as specified in paragraph (b)
(1), (2), (3), (4), (5), or (6) of this section:

(1) An owner or operator may demonstrate the required liability coverage
by having liability insurance as specified in this paragraph.

(i) Each insurance policy must be amended by attachment of the Hazardous
Secondary Material Facility Liability Endorsement or evidenced by a
Certificate of Liability Insurance.  The wording of the endorsement must
be identical to the wording specified in § 261.151(h).  The wording of
the certificate of insurance must be identical to the wording specified
in § 261.151(i).  The owner or operator must submit a signed duplicate
original of the endorsement or the certificate of insurance to the
Regional Administrator, or Regional Administrators if the facilities are
located in more than one Region.  If requested by a Regional
Administrator, the owner or operator must provide a signed duplicate
original of the insurance policy.

(ii) Each insurance policy must be issued by an insurer which, at a
minimum, is licensed to transact the business of insurance, or eligible
to provide insurance as an excess or surplus lines insurer, in one or
more States.

(2) An owner or operator may meet the requirements of this section by
passing a financial test or using the guarantee for liability coverage
as specified in paragraphs (f) and (g) of this section.

(3) An owner or operator may meet the requirements of this section by
obtaining a letter of credit for liability coverage as specified in
paragraph (h) of this section.

(4) An owner or operator may meet the requirements of this section by
obtaining a surety bond for liability coverage as specified in paragraph
(i) of this section.

(5) An owner or operator may meet the requirements of this section by
obtaining a trust fund for liability coverage as specified in paragraph
(j) of this section.

(6) An owner or operator may demonstrate the required liability coverage
through the use of combinations of insurance, financial test, guarantee,
letter of credit, surety bond, and trust fund, except that the owner or
operator may not combine a financial test covering part of the liability
coverage requirement with a guarantee unless the financial statement of
the owner or operator is not consolidated with the financial statement
of the guarantor.  The amounts of coverage demonstrated must total at
least the minimum amounts required by this section.  If the owner or
operator demonstrates the required coverage through the use of a
combination of financial assurances under this paragraph, the owner or
operator shall specify at least one such assurance as ``primary''
coverage and shall specify other assurance as ``excess'' coverage.

(7) An owner or operator shall notify the Regional Administrator in
writing within 30 days whenever:

(i) A claim results in a reduction in the amount of financial assurance
for liability coverage provided by a financial instrument authorized in
paragraphs (b)(1) through (b)(6) of this section; or

(ii) A Certification of Valid Claim for bodily injury or property
damages caused by a sudden or non-sudden accidental occurrence arising
from the operation of a hazardous secondary material treatment and/or
storage facility is entered between the owner or operator and
third-party claimant for liability coverage under paragraphs (b)(1)
through (b)(6) of this section; or

(iii) A final court order establishing a judgment for bodily injury or
property damage caused by a sudden or non-sudden accidental occurrence
arising from the operation of a hazardous secondary material treatment
and/or storage facility is issued against the owner or operator or an
instrument that is providing financial assurance for liability coverage
under paragraphs (b)(1) through (b)(6) of this section.

(c) Request for variance.  If an owner or operator can demonstrate to
the satisfaction of the Regional Administrator that the levels of
financial responsibility required by paragraph (a) or (b) of this
section are not consistent with the degree and duration of risk
associated with treatment and/or storage at the facility or group of
facilities, the owner or operator may obtain a variance from the
Regional Administrator.  The request for a variance must be submitted in
writing to the Regional Administrator.  If granted, the variance will
take the form of an adjusted level of required liability coverage, such
level to be based on the Regional Administrator's assessment of the
degree and duration of risk associated with the ownership or operation
of the facility or group of facilities.  The Regional Administrator may
require an owner or operator who requests a variance to provide such
technical and engineering information as is deemed necessary by the
Regional Administrator to determine a level of financial responsibility
other than that required by paragraph (a) or (b) of this section.

(d) Adjustments by the Regional Administrator.  If the Regional
Administrator determines that the levels of financial responsibility
required by paragraph (a) or (b) of this section are not consistent with
the degree and duration of risk associated with treatment and/or storage
at the facility or group of facilities, the Regional Administrator may
adjust the level of financial responsibility required under paragraph
(a) or (b) of this section as may be necessary to protect human health
and the environment.  This adjusted level will be based on the Regional
Administrator's assessment of the degree and duration of risk associated
with the ownership or operation of the facility or group of facilities.
In addition, if the Regional Administrator determines that there is a
significant risk to human health and the environment from nonsudden
accidental occurrences resulting from the operations of a facility that
is not a surface impoundment, pile, or land treatment facility, he may
require that an owner or operator of the facility comply with paragraph
(b) of this section.  An owner or operator must furnish to the Regional
Administrator, within a reasonable time, any information which the
Regional Administrator requests to determine whether cause exists for
such adjustments of level or type of coverage.

(e) Period of coverage. Within 60 days after receiving certifications
from the owner or operator and a qualified Professional Engineer that
all hazardous secondary materials have been removed from the facility or
a unit at the facility  and the facility or a unit has been
decontaminated in accordance with the approved plan per §261.143(h),
the Regional Administrator will notify the owner or operator in writing
that he is no longer required under §261.4(a)(24)(v)(F) to maintain
liability coverage for that facility or a unit at the facility, unless
the Regional Administrator has reason to believe that that all hazardous
secondary materials have not been removed from the facility or unit at a
facility or that the facility or unit has not been decontaminated in
accordance with the approved plan.

(f) Financial test for liability coverage. (1) An owner or operator may
satisfy the requirements of this section by demonstrating that he passes
a financial test as specified in this paragraph. To pass this test the
owner or operator must meet the criteria of paragraph (f)(1) (i) or (ii)
of this section:

(i) The owner or operator must have:

(A) Net working capital and tangible net worth each at least six times
the amount of liability coverage to be demonstrated by this test; and

(B) Tangible net worth of at least $10 million; and

(C) Assets in the United States amounting to either: ( 1 ) At least 90
percent of his total assets; or ( 2 ) at least six times the amount of
liability coverage to be demonstrated by this test.

(ii) The owner or operator must have:

(A) A current rating for his most recent bond issuance of AAA, AA, A, or
BBB as issued by Standard and Poor's, or Aaa, Aa, A, or Baa as issued by
Moody's; and

(B) Tangible net worth of at least $10 million; and

(C) Tangible net worth at least six times the amount of liability
coverage to be demonstrated by this test; and

(D) Assets in the United States amounting to either: ( 1 ) At least 90
percent of his total assets; or ( 2 ) at least six times the amount of
liability coverage to be demonstrated by this test.

(2) The phrase “amount of liability coverage” as used in paragraph
(f)(1) of this section refers to the annual aggregate amounts for which
coverage is required under paragraphs (a) and (b) of this section and
the annual aggregate amounts for which coverage is required under
paragraphs (a) and (b) of  40 CFR 264.147 and 265.147.

(3) To demonstrate that he meets this test, the owner or operator must
submit the following three items to the Regional Administrator:

(i) A letter signed by the owner's or operator's chief financial officer
and worded as specified in §261.151(f). If an owner or operator is
using the financial test to demonstrate both assurance as specified by
§261.143(e), and liability coverage, he must submit the letter
specified in §261.151(f) to cover both forms of financial
responsibility; a separate letter as specified in §261.151(e) is not
required.

(ii) A copy of the independent certified public accountant's report on
examination of the owner's or operator's financial statements for the
latest completed fiscal year.

(iii) If the chief financial officer’s letter providing evidence of
financial assurance includes financial data showing that the owner or
operator satisfies paragraph (f)(1)(i)of this section that are different
from the data in the audited financial statements referred to in
paragraph (f)(3)(ii)of this section or any other audited financial
statement or data filed with the SEC, then a special report from the
owner’s or operator’s independent certified public accountant to the
owner or operator is required. The special report shall be based upon an
agreed upon procedures engagement in accordance with professional
auditing standards and shall describe the procedures performed in
comparing the data in the chief financial officer’s letter derived
from the independently audited, year-end financial statements for the
latest fiscal year with the amounts in such financial statements, the
findings of the comparison, and the reasons for any difference.

(4) The owner or operator may obtain a one-time extension of the time
allowed for submission of the documents specified in paragraph (f)(3) of
this section if the fiscal year of the owner or operator ends during the
90 days prior to the effective date of these regulations and if the
year-end financial statements for that fiscal year will be audited by an
independent certified public accountant. The extension will end no later
than 90 days after the end of the owner's or operator's fiscal year. To
obtain the extension, the owner's or operator's chief financial officer
must send, by the effective date of these regulations, a letter to the
Regional Administrator of each Region in which the owner's or operator's
facilities to be covered by the financial test are located. This letter
from the chief financial officer must:

(i) Request the extension;

(ii) Certify that he has grounds to believe that the owner or operator
meets the criteria of the financial test;

(iii) Specify for each facility to be covered by the test the EPA
Identification Number, name, address, the amount of liability coverage
and, when applicable, current closure and post-closure cost estimates to
be covered by the test;

(iv) Specify the date ending the owner's or operator's last complete
fiscal year before the effective date of these regulations;

(v) Specify the date, no later than 90 days after the end of such fiscal
year, when he will submit the documents specified in paragraph (f)(3) of
this section; and

(vi) Certify that the year-end financial statements of the owner or
operator for such fiscal year will be audited by an independent
certified public accountant.

(5) After the initial submission of items specified in paragraph (f)(3)
of this section, the owner or operator must send updated information to
the Regional Administrator within 90 days after the close of each
succeeding fiscal year. This information must consist of all three items
specified in paragraph (f)(3) of this section.

(6) If the owner or operator no longer meets the requirements of
paragraph (f)(1) of this section, he must obtain insurance, a letter of
credit, a surety bond, a trust fund, or a guarantee for the entire
amount of required liability coverage as specified in this section.
Evidence of liability coverage must be submitted to the Regional
Administrator within 90 days after the end of the fiscal year for which
the year-end financial data show that the owner or operator no longer
meets the test requirements.

(7) The Regional Administrator may disallow use of this test on the
basis of qualifications in the opinion expressed by the independent
certified public accountant in his report on examination of the owner's
or operator's financial statements (see paragraph (f)(3)(ii) of this
section). An adverse opinion or a disclaimer of opinion will be cause
for disallowance. The Regional Administrator will evaluate other
qualifications on an individual basis. The owner or operator must
provide evidence of insurance for the entire amount of required
liability coverage as specified in this section within 30 days after
notification of disallowance.

(g) Guarantee for liability coverage. (1) Subject to paragraph (g)(2) of
this section, an owner or operator may meet the requirements of this
section by obtaining a written guarantee, hereinafter referred to as
“guarantee.” The guarantor must be the direct or higher-tier parent
corporation of the owner or operator, a firm whose parent corporation is
also the parent corporation of the owner or operator, or a firm with a
“substantial business relationship” with the owner or operator. The
guarantor must meet the requirements for owners or operators in
paragraphs (f)(1) through (f)(6) of this section. The wording of the
guarantee must be identical to the wording specified in §261.151(g)(2)
of this chapter. A certified copy of the guarantee must accompany the
items sent to the Regional Administrator as specified in paragraph
(f)(3) of this section. One of these items must be the letter from the
guarantor's chief financial officer. If the guarantor's parent
corporation is also the parent corporation of the owner or operator,
this letter must describe the value received in consideration of the
guarantee. If the guarantor is a firm with a “substantial business
relationship” with the owner or operator, this letter must describe
this “substantial business relationship” and the value received in
consideration of the guarantee.

(i) If the owner or operator fails to satisfy a judgment based on a
determination of liability for bodily injury or property damage to third
parties caused by sudden or nonsudden accidental occurrences (or both as
the case may be), arising from the operation of facilities covered by
this corporate guarantee, or fails to pay an amount agreed to in
settlement of claims arising from or alleged to arise from such injury
or damage, the guarantor will do so up to the limits of coverage.

(ii) [Reserved]

(2)(i) In the case of corporations incorporated in the United States, a
guarantee may be used to satisfy the requirements of this section only
if the Attorneys General or Insurance Commissioners of (A) the State in
which the guarantor is incorporated, and (B) each State in which a
facility covered by the guarantee is located have submitted a written
statement to EPA that a guarantee executed as described in this section
and §264.151(g)(2) is a legally valid and enforceable obligation in
that State.

(ii) In the case of corporations incorporated outside the United States,
a guarantee may be used to satisfy the requirements of this section only
if (A) the non-U.S. corporation has identified a registered agent for
service of process in each State in which a facility covered by the
guarantee is located and in the State in which it has its principal
place of business, and if (B) the Attorney General or Insurance
Commissioner of each State in which a facility covered by the guarantee
is located and the State in which the guarantor corporation has its
principal place of business, has submitted a written statement to EPA
that a guarantee executed as described in this section and
§261.151(h)(2) is a legally valid and enforceable obligation in that
State.

(h) Letter of credit for liability coverage. (1) An owner or operator
may satisfy the requirements of this section by obtaining an irrevocable
standby letter of credit that conforms to the requirements of this
paragraph and submitting a copy of the letter of credit to the Regional
Administrator.

(2) The financial institution issuing the letter of credit must be an
entity that has the authority to issue letters of credit and whose
letter of credit operations are regulated and examined by a Federal or
State agency.

(3) The wording of the letter of credit must be identical to the wording
specified in §261.151(j) of this chapter.

(4) An owner or operator who uses a letter of credit to satisfy the
requirements of this section may also establish a standby trust fund.
Under the terms of such a letter of credit, all amounts paid pursuant to
a draft by the trustee of the standby trust will be deposited by the
issuing institution into the standby trust in accordance with
instructions from the trustee. The trustee of the standby trust fund
must be an entity which has the authority to act as a trustee and whose
trust operations are regulated and examined by a Federal or State
agency.

(5) The wording of the standby trust fund must be identical to the
wording specified in §261.151(m).

(i) Surety bond for liability coverage. (1) An owner or operator may
satisfy the requirements of this section by obtaining a surety bond that
conforms to the requirements of this paragraph and submitting a copy of
the bond to the Regional Administrator.

(2) The surety company issuing the bond must be among those listed as
acceptable sureties on Federal bonds in the most recent Circular 570 of
the U.S. Department of the Treasury.

(3) The wording of the surety bond must be identical to the wording
specified in §261.151(k) of this chapter.

(4) A surety bond may be used to satisfy the requirements of this
section only if the Attorneys General or Insurance Commissioners of (i)
the State in which the surety is incorporated, and (ii) each State in
which a facility covered by the surety bond is located have submitted a
written statement to EPA that a surety bond executed as described in
this section and §261.151(k) of this chapter is a legally valid and
enforceable obligation in that State.

(j) Trust fund for liability coverage. (1) An owner or operator may
satisfy the requirements of this section by establishing a trust fund
that conforms to the requirements of this paragraph and submitting an
originally signed duplicate of the trust agreement to the Regional
Administrator.

(2) The trustee must be an entity which has the authority to act as a
trustee and whose trust operations are regulated and examined by a
Federal or State agency.

(3) The trust fund for liability coverage must be funded for the full
amount of the liability coverage to be provided by the trust fund before
it may be relied upon to satisfy the requirements of this section. If at
any time after the trust fund is created the amount of funds in the
trust fund is reduced below the full amount of the liability coverage to
be provided, the owner or operator, by the anniversary date of the
establishment of the Fund, must either add sufficient funds to the trust
fund to cause its value to equal the full amount of liability coverage
to be provided, or obtain other financial assurance as specified in this
section to cover the difference. For purposes of this paragraph, “the
full amount of the liability coverage to be provided” means the amount
of coverage for sudden and/or nonsudden occurrences required to be
provided by the owner or operator by this section, less the amount of
financial assurance for liability coverage that is being provided by
other financial assurance mechanisms being used to demonstrate financial
assurance by the owner or operator.

(4) The wording of the trust fund must be identical to the wording
specified in §261.151(l) of this part.

§261.148 Incapacity of owners or operators, guarantors, or financial
institutions.

    (a) An owner or operator must notify the Regional Administrator by
certified mail of the commencement of a voluntary or involuntary
proceeding under Title 11 (Bankruptcy), U.S. Code, naming the owner or
operator as debtor, within 10 days after commencement of the proceeding.
A guarantor of a corporate guarantee as specified in §261.143(e) must
make such a notification if he is named as debtor, as required under the
terms of the corporate guarantee.

 (b) An owner or operator who fulfills the requirements of § 261.143 or
§ 261.147 by obtaining a trust fund, surety bond, letter of credit, or
insurance policy will be deemed to be without the required financial
assurance or liability coverage in the event of bankruptcy of the
trustee or issuing institution, or a suspension or revocation of the
authority of the trustee institution to act as trustee or of the
institution issuing the surety bond, letter of credit, or insurance
policy to issue such instruments. The owner or operator must establish
other financial assurance or liability coverage within 60 days after
such an event.

§261.149 Use of State-required mechanisms.

    (a) For a reclamation or intermediate facility located in a State
where EPA is administering the requirements of this subpart but where
the State has regulations that include requirements for financial
assurance of closure or liability coverage, an owner or operator may use
State-required financial mechanisms to meet the requirements of §
261.143 or § 261.147 if the Regional Administrator determines that the
State mechanisms are at least equivalent to the financial mechanisms
specified in this subpart. The Regional Administrator will evaluate the
equivalency of the mechanisms principally in terms of (1) certainty of
the availability of funds for the required closure activities or
liability coverage and (2) the amount of funds that will be made
available. The Regional Administrator may also consider other factors as
he deems appropriate. The owner or operator must submit to the Regional
Administrator evidence of the establishment of the mechanism together
with a letter requesting that the State-required mechanism be considered
acceptable for meeting the requirements of this subpart. The submission
must include the following information: The facility's EPA
Identification Number (if available), name, and address, and the amount
of funds for closure or liability coverage assured by the mechanism. The
Regional Administrator will notify the owner or operator of his
determination regarding the mechanism's acceptability in lieu of
financial mechanisms specified in this subpart. The Regional
Administrator may require the owner or operator to submit additional
information as is deemed necessary to make this determination. Pending
this determination, the owner or operator will be deemed to be in
compliance with the requirements of § 261.143 or § 261.147, as
applicable.

 (b) If a State-required mechanism is found acceptable as specified in
paragraph (a) of this section except for the amount of funds available,
the owner or operator may satisfy the requirements of this subpart by
increasing the funds available through the State-required mechanism or
using additional financial mechanisms as specified in this subpart. The
amount of funds available through the State and Federal mechanisms must
at least equal the amount required by this subpart.

 §261.150 State assumption of responsibility.

    (a) If a State either assumes legal responsibility for an owner's or
operator's compliance with the closure or liability requirements of this
part or assures that funds will be available from State sources to cover
those requirements, the owner or operator will be in compliance with the
requirements of § 261.143 or § 261.147 if the Regional Administrator
determines that the State's assumption of responsibility is at least
equivalent to the financial mechanisms specified in this subpart. The
Regional Administrator will evaluate the equivalency of State guarantees
principally in terms of (1) certainty of the availability of funds for
the required closure activities or liability coverage and (2) the amount
of funds that will be made available. The Regional Administrator may
also consider other factors as he deems appropriate. The owner or
operator must submit to the Regional Administrator a letter from the
State describing the nature of the State's assumption of responsibility
together with a letter from the owner or operator requesting that the
State's assumption of responsibility be considered acceptable for
meeting the requirements of this subpart. The letter from the State must
include, or have attached to it, the following information: The
facility's EPA Identification Number (if available), name, and address,
and the amount of funds for closure or liability coverage that are
guaranteed by the State. The Regional Administrator will notify the
owner or operator of his determination regarding the acceptability of
the State's guarantee in lieu of financial mechanisms specified in this
subpart. The Regional Administrator may require the owner or operator to
submit additional information as is deemed necessary to make this
determination. Pending this determination, the owner or operator will be
deemed to be in compliance with the requirements of § 265.143 or §
265.147, as applicable.

 (b) If a State's assumption of responsibility is found acceptable as
specified in paragraph (a) of this section except for the amount of
funds available, the owner or operator may satisfy the requirements of
this subpart by use of both the State's assurance and additional
financial mechanisms as specified in this subpart. The amount of funds
available through the State and Federal mechanisms must at least equal
the amount required by this subpart.

§261.151 Wording of the instruments.

(a)(1) A trust agreement for a trust fund, as specified in §261.143(a)
of this chapter, must be worded as follows, except that instructions in
brackets are to be replaced with the relevant information and the
brackets deleted:

Trust Agreement

Trust Agreement, the “Agreement,” entered into as of [date] by and
between [name of the owner or operator], a [name of State] [insert
“corporation,” “partnership,” “association,” or
“proprietorship”], the “Grantor,” and [name of corporate
trustee], [insert “incorporated in the State of _______-----” or
“a national bank”], the “Trustee.”

Whereas, the United States Environmental Protection Agency, “EPA,”
an agency of the United States Government, has established certain
regulations applicable to the Grantor, requiring that an owner or
operator of a   facility regulated under parts 264, or 265, or
satisfying the conditions of the exclusion under §261.4(a)(24) shall
provide assurance that funds will be available if  needed for care of
the facility under 40 CFR parts 264 or 265, subparts G, as applicable  ,

Whereas, the Grantor has elected to establish a trust to provide all or
part of such financial assurance for the facilities identified herein,

Whereas, the Grantor, acting through its duly authorized officers, has
selected the Trustee to be the trustee under this agreement, and the
Trustee is willing to act as trustee,

Now, Therefore, the Grantor and the Trustee agree as follows:

Section 1.  Definitions.  As used in this Agreement:

(a) The term “Grantor” means the owner or operator who enters into
this Agreement and any successors or assigns of the Grantor.

(b) The term “Trustee” means the Trustee who enters into this
Agreement and any successor Trustee.

Section 2.  Identification of Facilities and Cost Estimates.  This
Agreement pertains to the facilities and cost estimates identified on
attached Schedule A [on Schedule A, for each facility list the EPA
Identification Number (if available), name, address, and the current
cost estimates, or portions thereof, for which financial assurance is
demonstrated by this Agreement].

Section 3.  Establishment of Fund.  The Grantor and the Trustee hereby
establish a trust fund, the “Fund,” for the benefit of EPA in the
event that the hazardous secondary materials of the grantor no longer
meet the conditions of the exclusion under §261.4(a)(24).   The Grantor
and the Trustee intend that no third party have access to the Fund
except as herein provided.  The Fund is established initially as
consisting of the property, which is acceptable to the Trustee,
described in Schedule B attached hereto.  Such property and any other
property subsequently transferred to the Trustee is referred to as the
Fund, together with all earnings and profits thereon, less any payments
or distributions made by the Trustee pursuant to this Agreement.  The
Fund shall be held by the Trustee, IN TRUST, as hereinafter provided.
The Trustee shall not be responsible nor shall it undertake any
responsibility for the amount or adequacy of, nor any duty to collect
from the Grantor, any payments necessary to discharge any liabilities of
the Grantor established by EPA.

Section 4.  Payments from the Fund.  The Trustee shall make payments
from the Fund as the EPA Regional Administrator  shall direct, in
writing, to provide for the payment of the costs of the performance of
activities required under subpart G of 40 CFR parts 264 or 265 for the
facilities covered by this Agreement.  The Trustee shall reimburse the
Grantor or other persons as specified by the EPA Regional Administrator
from the Fund for expenditures for such activities in such amounts as
the beneficiary shall direct in writing.  In addition, the Trustee shall
refund to the Grantor such amounts as the EPA Regional Administrator
specifies in writing.  Upon refund, such funds shall no longer
constitute part of the Fund as defined herein.

Section 5.  Payments Comprising the Fund.  Payments made to the Trustee
for the Fund shall consist of cash or securities acceptable to the
Trustee.

Section 6.  Trustee Management.  The Trustee shall invest and reinvest
the principal and income of the Fund and keep the Fund invested as a
single fund, without distinction between principal and income, in
accordance with general investment policies and guidelines which the
Grantor may communicate in writing to the Trustee from time to time,
subject, however, to the provisions of this section.  In investing,
reinvesting, exchanging, selling, and managing the Fund, the Trustee
shall discharge his duties with respect to the trust fund solely in the
interest of the beneficiary and with the care, skill, prudence, and
diligence under the circumstances then prevailing which persons of
prudence, acting in a like capacity and familiar with such matters,
would use in the conduct of an enterprise of a like character and with
like aims; except that:

(i) Securities or other obligations of the Grantor, or any other owner
or operator of the facilities, or any of their affiliates as defined in
the Investment Company Act of 1940, as amended, 15 U.S.C.  80a-2.(a),
shall not be acquired or held, unless they are securities or other
obligations of the Federal or a State government;

(ii) The Trustee is authorized to invest the Fund in time or demand
deposits of the Trustee, to the extent insured by an agency of the
Federal or State government; and

(iii) The Trustee is authorized to hold cash awaiting investment or
distribution uninvested for a reasonable time and without liability for
the payment of interest thereon.

Section 7.  Commingling and Investment.  The Trustee is expressly
authorized in its discretion:

(a) To transfer from time to time any or all of the assets of the Fund
to any common, commingled, or collective trust fund created by the
Trustee in which the Fund is eligible to participate, subject to all of
the provisions thereof, to be commingled with the assets of other trusts
participating therein; and

(b) To purchase shares in any investment company registered under the
Investment Company Act of 1940, 15 U.S.C.  80a-1 et seq., including one
which may be created, managed, underwritten, or to which investment
advice is rendered or the shares of which are sold by the Trustee.  The
Trustee may vote such shares in its discretion.

Section 8.  Express Powers of Trustee.  Without in any way limiting the
powers and discretions conferred upon the Trustee by the other
provisions of this Agreement or by law, the Trustee is expressly
authorized and empowered:

(a) To sell, exchange, convey, transfer, or otherwise dispose of any
property held by it, by public or private sale.  No person dealing with
the Trustee shall be bound to see to the application of the purchase
money or to inquire into the validity or expediency of any such sale or
other disposition;

(b) To make, execute, acknowledge, and deliver any and all documents of
transfer and conveyance and any and all other instruments that may be
necessary or appropriate to carry out the powers herein granted;

(c) To register any securities held in the Fund in its own name or in
the name of a nominee and to hold any security in bearer form or in book
entry, or to combine certificates representing such securities with
certificates of the same issue held by the Trustee in other fiduciary
capacities, or to deposit or arrange for the deposit of such securities
in a qualified central depositary even though, when so deposited, such
securities may be merged and held in bulk in the name of the nominee of
such depositary with other securities deposited therein by another
person, or to deposit or arrange for the deposit of any securities
issued by the United States Government, or any agency or instrumentality
thereof, with a Federal Reserve bank, but the books and records of the
Trustee shall at all times show that all such securities are part of the
Fund;

(d) To deposit any cash in the Fund in interest-bearing accounts
maintained or savings certificates issued by the Trustee, in its
separate corporate capacity, or in any other banking institution
affiliated with the Trustee, to the extent insured by an agency of the
Federal or State government; and

(e) To compromise or otherwise adjust all claims in favor of or against
the Fund.

Section 9.  Taxes and Expenses.  All taxes of any kind that may be
assessed or levied against or in respect of the Fund and all brokerage
commissions incurred by the Fund shall be paid from the Fund.  All other
expenses incurred by the Trustee in connection with the administration
of this Trust, including fees for legal services rendered to the
Trustee, the compensation of the Trustee to the extent not paid directly
by the Grantor, and all other proper charges and disbursements of the
Trustee shall be paid from the Fund.

Section 10.  Annual Valuation.  The Trustee shall annually, at least 30
days prior to the anniversary date of establishment of the Fund, furnish
to the Grantor and to the appropriate EPA Regional Administrator a
statement confirming the value of the Trust.  Any securities in the Fund
shall be valued at market value as of no more than 60 days prior to the
anniversary date of establishment of the Fund.  The failure of the
Grantor to object in writing to the Trustee within 90 days after the
statement has been furnished to the Grantor and the EPA Regional
Administrator shall constitute a conclusively binding assent by the
Grantor, barring the Grantor from asserting any claim or liability
against the Trustee with respect to matters disclosed in the statement.

Section 11.  Advice of Counsel.  The Trustee may from time to time
consult with counsel, who may be counsel to the Grantor, with respect to
any question arising as to the construction of this Agreement or any
action to be taken hereunder.  The Trustee shall be fully protected, to
the extent permitted by law, in acting upon the advice of counsel.

Section 12.  Trustee Compensation.  The Trustee shall be entitled to
reasonable compensation for its services as agreed upon in writing from
time to time with the Grantor.

Section 13.  Successor Trustee.  The Trustee may resign or the Grantor
may replace the Trustee, but such resignation or replacement shall not
be effective until the Grantor has appointed a successor trustee and
this successor accepts the appointment.  The successor trustee shall
have the same powers and duties as those conferred upon the Trustee
hereunder.  Upon the successor trustee's acceptance of the appointment,
the Trustee shall assign, transfer, and pay over to the successor
trustee the funds and properties then constituting the Fund.  If for any
reason the Grantor cannot or does not act in the event of the
resignation of the Trustee, the Trustee may apply to a court of
competent jurisdiction for the appointment of a successor trustee or for
instructions.  The successor trustee shall specify the date on which it
assumes administration of the trust in a writing sent to the Grantor,
the EPA Regional Administrator, and the present Trustee by certified
mail 10 days before such change becomes effective.  Any expenses
incurred by the Trustee as a result of any of the acts contemplated by
this Section shall be paid as provided in Section 9.

Section 14.  Instructions to the Trustee.  All orders, requests, and
instructions by the Grantor to the Trustee shall be in writing, signed
by such persons as are designated in the attached Exhibit A or such
other designees as the Grantor may designate by amendment to Exhibit A.
The Trustee shall be fully protected in acting without inquiry in
accordance with the Grantor's orders, requests, and instructions.  All
orders, requests, and instructions by the EPA Regional Administrator to
the Trustee shall be in writing, signed by the EPA Regional
Administrators of the Regions in which the facilities are located, or
their designees, and the Trustee shall act and shall be fully protected
in acting in accordance with such orders, requests, and instructions.
The Trustee shall have the right to assume, in the absence of written
notice to the contrary, that no event constituting a change or a
termination of the authority of any person to act on behalf of the
Grantor or EPA hereunder has occurred.  The Trustee shall have no duty
to act in the absence of such orders, requests, and instructions from
the Grantor and/or EPA, except as provided for herein.

Section 15.  Amendment of Agreement.  This Agreement may be amended by
an instrument in writing executed by the Grantor, the Trustee, and the
appropriate EPA Regional Administrator, or by the Trustee and the
appropriate EPA Regional Administrator if the Grantor ceases to exist.

Section 16.  Irrevocability and Termination.  Subject to the right of
the parties to amend this Agreement as provided in Section 16, this
Trust shall be irrevocable and shall continue until terminated at the
written agreement of the Grantor, the Trustee, and the EPA Regional
Administrator, or by the Trustee and the EPA Regional Administrator, if
the Grantor ceases to exist.  Upon termination of the Trust, all
remaining trust property, less final trust administration expenses,
shall be delivered to the Grantor.

Section 17.  Immunity and Indemnification.  The Trustee shall not incur
personal liability of any nature in connection with any act or omission,
made in good faith, in the administration of this Trust, or in carrying
out any directions by the Grantor or the EPA Regional Administrator
issued in accordance with this Agreement.  The Trustee shall be
indemnified and saved harmless by the Grantor or from the Trust Fund, or
both, from and against any personal liability to which the Trustee may
be subjected by reason of any act or conduct in its official capacity,
including all expenses reasonably incurred in its defense in the event
the Grantor fails to provide such defense.

Section 18.  Choice of Law.  This Agreement shall be administered,
construed, and enforced according to the laws of the State of [insert
name of State].

Section 19.  Interpretation.  As used in this Agreement, words in the
singular include the plural and words in the plural include the
singular.  The descriptive headings for each Section of this Agreement
shall not affect the interpretation or the legal efficacy of this
Agreement.

In Witness Whereof the parties have caused this Agreement to be executed
by their respective officers duly authorized and their corporate seals
to be hereunto affixed and attested as of the date first above written:
The parties below certify that the wording of this Agreement is
identical to the wording specified in 40 CFR 261.151(a)(1) as such
regulations were constituted on the date first above written.

[Signature of Grantor]

[Title]

Attest:

[Title]

[Seal]

[Signature of Trustee]

Attest:

[Title]

[Seal]

(2) The following is an example of the certification of acknowledgment
which must accompany the trust agreement for a trust fund as specified
in §261.143(a) this chapter.  State requirements may differ on the
proper content of this acknowledgment.

State
of_________________________________________________________________

County of_______________________________________________________________

On this [date], before me personally came [owner or operator] to me
known, who, being by me duly sworn, did depose and say that she/he
resides at [address], that she/he is [title] of [corporation], the
corporation described in and which executed the above instrument; that
she/he knows the seal of said corporation; that the seal affixed to such
instrument is such corporate seal; that it was so affixed by order of
the Board of Directors of said corporation, and that she/he signed
her/his name thereto by like order.

[Signature of Notary Public]

(b) A surety bond guaranteeing payment into a trust fund, as specified
in §261.143(b) of this chapter, must be worded as follows, except that
instructions in brackets are to be replaced with the relevant
information and the brackets deleted:

Financial Guarantee Bond

Date bond executed:

Effective date:

Principal:  [legal name and business address of owner or operator]

Type of Organization:  [insert “individual,” “joint venture,”
“partnership,” or “corporation”]

State of incorporation:
_________________________________________________

Surety(ies):  [name(s) and business address(es)]

EPA Identification Number, name, address and amount(s) for each facility
guaranteed by this bond:
_________________________________________________

Total penal sum of bond:
$________________________________________________

Surety's bond number:
___________________________________________________

Know All Persons By These Presents, That we, the Principal and
Surety(ies) are firmly bound to the U.S. EPA in the event that the
hazardous secondary materials at the reclamation or intermediate
facility listed below no longer meet the conditions of the exclusion
under 40 CFR 261.4(a)(24), in the above penal sum for the payment of
which we bind ourselves, our heirs, executors, administrators,
successors, and assigns jointly and severally; provided that, where the
Surety(ies) are corporations acting as co-sureties, we, the Sureties,
bind ourselves in such sum “jointly and severally” only for the
purpose of allowing a joint action or actions against any or all of us,
and for all other purposes each Surety binds itself, jointly and
severally with the Principal, for the payment of such sum only as is set
forth opposite the name of such Surety, but if no limit of liability is
indicated, the limit of liability shall be the full amount of the penal
sum.

Whereas said Principal is required, under the Resource Conservation and
Recovery Act as amended (RCRA), to have a permit or interim status in
order to own or operate each facility identified above, or to meet
conditions under 40 CFR sections 261.4(a)(24),and

Whereas said Principal is required to provide financial assurance as a
condition of permit or interim status or as a condition of an exclusion
under 40 CFR sections 261.4(a)(24) and

Whereas said Principal shall establish a standby trust fund as is
required when a surety bond is used to provide such financial assurance;

Now, Therefore, the conditions of the obligation are such that if the
Principal shall faithfully, before the beginning of final closure of
each facility identified above, fund the standby trust fund in the
amount(s) identified above for the facility,

Or, if the Principal shall satisfy all the conditions established for
exclusion of  hazardous secondary materials from coverage as solid waste
under 40 CFR sections 261.4(a)(24),

Or, if the Principal shall fund the standby trust fund in such amount(s)
within 15 days after a final order to begin closure is issued by an EPA
Regional Administrator or a U.S. district court or other court of
competent jurisdiction,

Or, if the Principal shall provide alternate financial assurance, as
specified in subpart H of 40 CFR part261, as applicable, and obtain the
EPA Regional Administrator's written approval of such assurance, within
90 days after the date notice of cancellation is received by both the
Principal and the EPA Regional Administrator(s) from the Surety(ies),
then this obligation shall be null and void; otherwise it is to remain
in full force and effect.

The Surety(ies) shall become liable on this bond obligation only when
the Principal has failed to fulfill the conditions described above.
Upon notification by an EPA Regional Administrator that the Principal
has failed to perform as guaranteed by this bond, the Surety(ies) shall
place funds in the amount guaranteed for the facility(ies) into the
standby trust fund as directed by the EPA Regional Administrator.

The liability of the Surety(ies) shall not be discharged by any payment
or succession of payments hereunder, unless and until such payment or
payments shall amount in the aggregate to the penal sum of the bond, but
in no event shall the obligation of the Surety(ies) hereunder exceed the
amount of said penal sum.

The Surety(ies) may cancel the bond by sending notice of cancellation by
certified mail to the Principal and to the EPA Regional Administrator(s)
for the Region(s) in which the facility(ies) is (are) located, provided,
however, that cancellation shall not occur during the 120 days beginning
on the date of receipt of the notice of cancellation by both the
Principal and the EPA Regional Administrator(s), as evidenced by the
return receipts.

The Principal may terminate this bond by sending written notice to the
Surety(ies), provided, however, that no such notice shall become
effective until the Surety(ies) receive(s) written authorization for
termination of the bond by the EPA Regional Administrator(s) of the EPA
Region(s) in which the bonded facility(ies) is (are) located.

[The following paragraph is an optional rider that may be included but
is not required.]

Principal and Surety(ies) hereby agree to adjust the penal sum of the
bond yearly so that it guarantees a new amount, provided that the penal
sum does not increase by more than 20 percent in any one year, and no
decrease in the penal sum takes place without the written permission of
the EPA Regional Administrator(s).

In Witness Whereof, the Principal and Surety(ies) have executed this
Financial Guarantee Bond and have affixed their seals on the date set
forth above.

The persons whose signatures appear below hereby certify that they are
authorized to execute this surety bond on behalf of the Principal and
Surety(ies) and that the wording of this surety bond is identical to the
wording specified in 40 CFR 261.151(b)as such regulations were
constituted on the date this bond was executed.

Principal

[Signature(s)]
____________________________________________________________

[Name(s)]
_______________________________________________________________

[Title(s)]
________________________________________________________________

[Corporate seal]
__________________________________________________________

Corporate Surety(ies)

[Name and address]

State of
incorporation:______________________________________________________

Liability limit:
$___________________________________________________________

[Signature(s)]

[Name(s) and title(s)]

[Corporate seal]

[For every co-surety, provide signature(s), corporate seal, and other
information in the same manner as for Surety above.]

Bond premium:  $________________________________________________________

(c)  A letter of credit, as specified in §261.143(c) of this chapter,
must be worded as follows, except that instructions in brackets are to
be replaced with the relevant information and the brackets deleted:

Irrevocable Standby Letter of Credit

Regional Administrator(s)
Region(s)________________________________________________

U.S. Environmental Protection Agency

Dear Sir or Madam: We hereby establish our Irrevocable Standby Letter of
Credit No.  ____________ in your favor, in the event that the hazardous
secondary materials at the covered reclamation or intermediary
facility(ies) no longer meet the conditions of the exclusion under 40
CFR 261.4(a)(24), at the request and for the account of [owner's or
operator's name and address] up to the aggregate amount of [in words]
U.S. dollars $_________, available upon presentation of

(1) your sight draft, bearing reference to this letter of credit No.
------, and

(2) your signed statement reading as follows: “I certify that the
amount of the draft is payable pursuant to regulations issued under
authority of the Resource Conservation and Recovery Act of 1976 as
amended.”

This letter of credit is effective as of [date] and shall expire on
[date at least 1 year later], but such expiration date shall be
automatically extended for a period of [at least 1 year] on [date] and
on each successive expiration date, unless, at least 120 days before the
current expiration date, we notify both you and [owner's or operator's
name] by certified mail that we have decided not to extend this letter
of credit beyond the current expiration date.  In the event you are so
notified, any unused portion of the credit shall be available upon
presentation of your sight draft for 120 days after the date of receipt
by both you and [owner's or operator's name], as shown on the signed
return receipts.

Whenever this letter of credit is drawn on under and in compliance with
the terms of this credit, we shall duly honor such draft upon
presentation to us, and we shall deposit the amount of the draft
directly into the standby trust fund of [owner's or operator's name] in
accordance with your instructions.

We certify that the wording of this letter of credit is identical to the
wording specified in 40 CFR 261.151(c) as such regulations were
constituted on the date shown immediately below.

[Signature(s) and title(s) of official(s) of issuing institution] [Date]

This credit is subject to [insert “the most recent edition of the
Uniform Customs and Practice for Documentary Credits, published and
copyrighted by the International Chamber of Commerce,” or “the
Uniform Commercial Code”].

(d)  A certificate of insurance, as specified in Sec.  261.143(e) of
this chapter, must be worded as follows, except that instructions in
brackets are to be replaced with the relevant information and the
brackets deleted:

Certificate of Insurance

Name and Address of Insurer (herein called the “Insurer”):
_____________________________

Name and Address of Insured (herein called the “Insured”):
____________________________

Facilities Covered: [List for each facility: The EPA Identification
Number (if any issued), name, address, and the amount of insurance for
all facilities covered, which must total the face amount shown below.

Face Amount:
____________________________________________________________

Policy Number:
__________________________________________________________

Effective Date:
___________________________________________________________

The Insurer hereby certifies that it has issued to the Insured the
policy of insurance identified above to provide financial assurance so
that in accordance with applicable regulations all hazardous secondary
materials can be removed from the facility or any  unit at the facility
and the facility or any unit at the facility can be decontaminated at
the facilities identified above.  The Insurer further warrants that such
policy conforms in all respects with the requirements of 40 CFR
261.143(d)  as applicable and as such regulations were constituted on
the date shown immediately below.  It is agreed that any provision of
the policy inconsistent with such regulations is hereby amended to
eliminate such inconsistency.

Whenever requested by the EPA Regional Administrator(s) of the U.S.
Environmental Protection Agency, the Insurer agrees to furnish to the
EPA Regional Administrator(s) a duplicate original of the policy listed
above, including all endorsements thereon.

I hereby certify that the wording of this certificate is identical to
the wording specified in 40 CFR 261.151(d) such regulations were
constituted on the date shown immediately below.

[Authorized signature for Insurer]

[Name of person signing]

[Title of person signing]

Signature of witness or notary:_________________________________________

[Date]

(e) A letter from the chief financial officer, as specified in
§261.143(e) of this chapter, must be worded as follows, except that
instructions in brackets are to be replaced with the relevant
information and the brackets deleted:

Letter From Chief Financial Officer

[Address to Regional Administrator of every Region in which facilities
for which financial responsibility is to be demonstrated through the
financial test are located].

I am the chief financial officer of [name and address of firm].  This
letter is in support of this firm's use of the financial test to
demonstrate financial assurance, as specified in subpart H of 40 CFR
part 261.

[Fill out the following nine paragraphs regarding facilities and
associated cost estimates.  If your firm has no facilities that belong
in a particular paragraph, write “None” in the space indicated.  For
each facility, include its EPA Identification Number (if any issued),
name, address, and current cost estimates.

1.  This firm is the owner or operator of the following facilities for
which financial assurance is demonstrated through the financial test
specified in subpart H of 40 CFR 261.  The current cost estimates
covered by the test are shown for each facility: ____________.

2.  This firm guarantees, through the guarantee specified in subpart H
of 40 CFR part 261, the following facilities owned or operated by the
guaranteed party.  The current cost estimates so guaranteed are shown
for each facility:  ___________.   The firm identified above is [insert
one or more: (1) The direct or higher-tier parent corporation of the
owner or operator; (2) owned by the same parent corporation as the
parent corporation of the owner or operator, and receiving the following
value in consideration of this guarantee ___________, or (3) engaged in
the following substantial business relationship with the owner or
operator _________, and receiving the following value in consideration
of this guarantee_______].  [Attach a written description of the
business relationship or a copy of the contract establishing such
relationship to this letter].

3.  In States where EPA is not administering the financial requirements
of subpart H of 40 CFR part 261, this firm, as owner or operator or
guarantor, is demonstrating financial assurance for the following
facilities through the use of a test equivalent or substantially
equivalent to the financial test specified in subpart H of 40 CFR part
261.  The current cost estimates covered by such a test are shown for
each facility:________.

4.  This firm is the owner or operator of the following hazardous
secondary materials management facilities for which financial assurance
is not demonstrated either to EPA or a State through the financial test
or any other financial assurance mechanism specified in subpart H of 40
CFR part 261or equivalent or substantially equivalent State mechanisms.
The current cost estimates not covered by such financial assurance are
shown for each facility: _________.

5.  This firm is the owner or operator of the following UIC facilities
for which financial assurance for plugging and abandonment is required
under part 144.  The current closure cost estimates as required by 40
CFR 144.62 are shown for each facility:_______.

6. This firm is the owner or operator of the following facilities for
which financial assurance for closure or post-closure care is
demonstrated through the financial test specified in subpart H of 40 CFR
parts 264 and 265. The current closure and/or post-closure cost
estimates covered by the test are shown for each facility: ____.

7. This firm guarantees, through the guarantee specified in subpart H of
40 CFR parts 264 and 265, the closure or post-closure care of the
following facilities owned or operated by the guaranteed party. The
current cost estimates for the closure or post-closure care so
guaranteed are shown for each facility: ____. The firm identified above
is [insert one or more: (1) The direct or higher-tier parent corporation
of the owner or operator; (2) owned by the same parent corporation as
the parent corporation of the owner or operator, and receiving the
following value in consideration of this guarantee ____; or (3) engaged
in the following substantial business relationship with the owner or
operator ____, and receiving the following value in consideration of
this guarantee ____]. [Attach a written description of the business
relationship or a copy of the contract establishing such relationship to
this letter].

8. In States where EPA is not administering the financial requirements
of subpart H of 40 CFR part 264 or 265, this firm, as owner or operator
or guarantor, is demonstrating financial assurance for the closure or
post-closure care of the following facilities through the use of a test
equivalent or substantially equivalent to the financial test specified
in subpart H of 40 CFR parts 264 and 265. The current closure and/or
post-closure cost estimates covered by such a test are shown for each
facility: ____.

9. This firm is the owner or operator of the following hazardous waste
management facilities for which financial assurance for closure or, if a
disposal facility, post-closure care, is not demonstrated either to EPA
or a State through the financial test or any other financial assurance
mechanism specified in subpart H of 40 CFR parts 264 and 265 or
equivalent or substantially equivalent State mechanisms. The current
closure and/or post-closure cost estimates not covered by such financial
assurance are shown for each facility: ____.

This firm [insert “is required” or “is not required”] to file a
Form 10K with the Securities and Exchange Commission (SEC) for the
latest fiscal year.

The fiscal year of this firm ends on [month, day].  The figures for the
following items marked with an asterisk are derived from this firm's
independently audited, year-end financial statements for the latest
completed fiscal year, ended [date].

[Fill in Alternative I if the criteria of paragraph (e)(1)(i) of
§261.143 of this chapter are used.  Fill in Alternative II if the
criteria of paragraph (e)(1)(ii) of §261.143(e) of this chapter are
used.]

Alternative I

1.  Sum of current cost estimates[total of all cost estimates shown in
the nine paragraphs above] $_____

*2.  Total liabilities [if any portion of the cost estimates is included
in total liabilities, you may deduct the amount of that portion from
this line and add that amount to lines 3 and 4]$_______

*3.  Tangible net worth $_______

*4.  Net worth $_______-

*5.  Current assets $_______

*6.  Current liabilities $_______

7.  Net working capital [line 5 minus line 6] $_______

*8.  The sum of net income plus depreciation, depletion, and
amortization $_______-

*9.  Total assets in U.S. (required only if less than 90% of firm's
assets are located in the U.S.) $_______-

10.  Is line 3 at least $10 million? (Yes/No) _______

11.  Is line 3 at least 6 times line 1? (Yes/No) _______-

12.  Is line 7 at least 6 times line 1? (Yes/No) _______-

*13.  Are at least 90% of firm's assets located in the U.S.? If not,
complete line 14 (Yes/No) _______

14.  Is line 9 at least 6 times line 1? (Yes/No) _______-

15.  Is line 2 divided by line 4 less than 2.0? (Yes/No) _______-

16.  Is line 8 divided by line 2 greater than 0.1? (Yes/No) _______-

17.  Is line 5 divided by line 6 greater than 1.5? (Yes/No) _______-

Alternative II

1.  Sum of current cost estimates [total of all cost estimates shown in
the eight paragraphs above] $_______-

2.  Current bond rating of most recent issuance of this firm and name of
rating service _______-

3.  Date of issuance of bond _______-

4.  Date of maturity of bond _______-

*5.  Tangible net worth [if any portion of the cost estimates is
included in “total liabilities” on your firm's financial statements,
you may add the amount of that portion to this line] $_______-

*6.  Total assets in U.S. (required only if less than 90% of firm's
assets are located in the U.S.) $_______-

7.  Is line 5 at least $10 million? (Yes/No) _______

8.  Is line 5 at least 6 times line 1? (Yes/No) _______

*9.  Are at least 90% of firm's assets located in the U.S.? If not,
complete line 10 (Yes/No) _______

10.  Is line 6 at least 6 times line 1? (Yes/No) _______-

I hereby certify that the wording of this letter is identical to the
wording specified in 40 CFR 261.151(e) as such regulations were
constituted on the date shown immediately below.

[Signature]
_____________________________________________________________

[Name]  ________________________________________________________________

[Title]
_________________________________________________________________

[Date]
__________________________________________________________________

(f) A letter from the chief financial officer, as specified in Sec.
261.147(f) of this chapter, must be worded as follows, except that
instructions in brackets are to be replaced with the relevant
information and the brackets deleted.

Letter From Chief Financial Officer

[Address to Regional Administrator of every Region in which facilities
for which financial responsibility is to be demonstrated through the
financial test are located].

I am the chief financial officer of [firm's name and address].  This
letter is in support of the use of the financial test to demonstrate
financial responsibility for liability coverage under  §261.147[insert
“and costs assured §261.143(e)” if applicable] as specified in
subpart H of 40 CFR part 261.

[Fill out the following paragraphs regarding facilities and liability
coverage.  If there are no facilities that belong in a particular
paragraph, write “None” in the space indicated.  For each facility,
include its EPA Identification Number (if any issued), name, and
address].

The firm identified above is the owner or operator of the following
facilities for which liability coverage for [insert “sudden” or
“nonsudden” or “both sudden and nonsudden”] accidental
occurrences is being demonstrated through the financial test specified
in subpart H of 40 CFR part 261:_______

The firm identified above guarantees, through the guarantee specified in
subpart H of 40 CFR part 261, liability coverage for [insert
“sudden” or “nonsudden” or “both sudden and nonsudden”]
accidental occurrences at the following facilities owned or operated by
the following: _______-.  The firm identified above is [insert one or
more: (1) The direct or higher-tier parent corporation of the owner or
operator; (2) owned by the same parent corporation as the parent
corporation of the owner or operator, and receiving the following value
in consideration of this guarantee _______-; or (3) engaged in the
following substantial business relationship with the owner or operator
_______-, and receiving the following value in consideration of this
guarantee _______-].  [Attach a written description of the business
relationship or a copy of the contract establishing such relationship to
this letter.]

The firm identified above is the owner or operator of the following
facilities for which liability coverage for [insert “sudden” or
“nonsudden” or “both sudden and nonsudden”] accidental