CHAPTER 6. BONDING
IC 14-34-6
Chapter 6. Bonding
IC 14-34-6-1
Bond requirements
Sec. 1. (a) After a surface coal mining and reclamation permitapplication is approved but before the permit is issued, the applicantmust file with the director, on a form prescribed and furnished by thedirector, a bond for performance payable to the state and conditionalupon faithful performance of all the requirements of this article andof the permit. The bond must cover the area of land within the permitarea upon which the operator will initiate and conduct surface coalmining and reclamation operations within the initial term of thepermit.
(b) As succeeding increments of surface coal mining andreclamation operations are initiated and conducted within the permitarea, the permittee must file with the director an additional bond tocover those increments in accordance with this chapter.
(c) If a permittee files a bond that becomes unacceptable undersection 4 of this chapter, the permittee must file an acceptable bondas required by the director.
As added by P.L.1-1995, SEC.27.
IC 14-34-6-2
Bond amount
Sec. 2. (a) The director shall determine the amount of the bondrequired for each bonded area. The amount of the bond must besufficient to assure the completion of the reclamation plan if thework had to be performed by the director if forfeiture occurs.However, the bond amount may not be less than ten thousand dollars($10,000).
(b) In making a determination of bond amount, the director shallconsider the following:
(1) The reclamation requirements of the approved permit.
(2) The probable difficulty of reclamation due to factors suchas the following:
(A) Topography.
(B) Geology of the site.
(C) Hydrology.
(D) Revegetation potential.
(3) The history of mining and reclamation activities of theapplicant.
As added by P.L.1-1995, SEC.27.
IC 14-34-6-3
Liability under bond
Sec. 3. Liability under the bond extends for:
(1) the duration of the surface coal mining and reclamationoperation; and
(2) a period coincident with the operator's responsibility for
revegetation requirements in IC 14-34-10.
As added by P.L.1-1995, SEC.27.
IC 14-34-6-4
Execution of bond
Sec. 4. The operator and a corporate surety:
(1) licensed to do business in Indiana; and
(2) recognized by the treasurer of state as holding a certificateof authority from the United States Department of the Treasuryas an acceptable surety on federal bonds;
shall execute the bond.
As added by P.L.1-1995, SEC.27.
IC 14-34-6-5
Options instead of bond
Sec. 5. (a) Instead of a bond, an operator may elect to deposit:
(1) cash;
(2) negotiable bonds of the United States government or ofIndiana; or
(3) negotiable certificates of deposit or letters of credit of abank organized or transacting business in the United States;
in an amount or that has a market value equal to or greater than theamount of the bond required for the bonded area under the sameterms and conditions upon which surety bonds are deposited.
(b) In the alternative, the director may accept the applicant's ownbond without separate surety if the applicant demonstrates to thesatisfaction of the department under IC 14-34-7 the following:
(1) The existence of a suitable agent to receive service ofprocess.
(2) A history of financial solvency and continuous operationsufficient for authorization to self insure or bond the amount.
As added by P.L.1-1995, SEC.27.
IC 14-34-6-6
Adjustment of bond or deposit amount
Sec. 6. The director shall adjust the amount of the bond or depositrequired and the terms of each acceptance of the applicant's bondperiodically as:
(1) affected land acreages are increased or decreased;
(2) changes occur in the cost of future reclamation; or
(3) significant changes occur in the history of the mining andreclamation activities of the applicant.
As added by P.L.1-1995, SEC.27.
IC 14-34-6-7
Release of bond or deposit
Sec. 7. (a) After a permit is issued, the permittee may apply to thedirector for the release of all or part of the bond or deposit. As partof the bond release application, the permittee must do the following:
(1) Submit copies of letters that the permittee has sent by
certified mail to:
(A) adjoining property owners;
(B) local government bodies;
(C) planning agencies;
(D) sewage and water treatment authorities; or
(E) water companies;
in the county in which the surface coal mining and reclamationoperation is located notifying the entities of the bond releaseapplication.
(2) Within thirty (30) days after filing the bond releaseapplication, submit a copy of an advertisement placed at leastone (1) time a week for four (4) successive weeks in anewspaper of general circulation in the county in which thesurface coal mining and reclamation operation is located. Theadvertisement must contain the following:
(A) A notification of the precise location of the landaffected.
(B) The number of acres.
(C) The permit and the date of approval.
(D) The amount of the bond filed and the part sought to bereleased.
(E) The type and appropriate dates of reclamation workperformed.
(F) A description of the results achieved relating to theoperator's approved reclamation plan.
(b) The director may initiate an application for the release of abond. If a bond release application is initiated by the director, thedepartment shall perform the notification and certificationrequirements otherwise imposed on the permittee under this sectionand section 8 of this chapter.
As added by P.L.1-1995, SEC.27. Amended by P.L.71-2004, SEC.26.
IC 14-34-6-8
Bond release application; notification
Sec. 8. If an application for total or partial bond release is filedwith the director, the director shall notify appropriate:
(1) local governmental bodies;
(2) planning agencies;
(3) sewage and water treatment authorities; or
(4) water companies;
in the county in which the surface coal mining operation is locatedby certified mail at least thirty (30) days before the release of all ora part of the bond.
As added by P.L.1-1995, SEC.27.
IC 14-34-6-9
Inspection and evaluation
Sec. 9. Within thirty (30) days of receipt of a bond releaseapplication, the director shall conduct an inspection and evaluationof the reclamation work involved. The evaluation must include the
following:
(1) The degree of difficulty to complete a remainingreclamation.
(2) Whether pollution of surface and subsurface water isoccurring.
(3) The probability of continuance or future occurrence of thepollution.
(4) The estimated cost of abating the pollution.
As added by P.L.1-1995, SEC.27.
IC 14-34-6-10
Written objections; request for public hearing
Sec. 10. (a) This section applies to the following:
(1) A person with a legal interest that might be adverselyaffected by release of a bond.
(2) The responsible officer or head of a federal, state, or localgovernmental agency that:
(A) has jurisdiction by law or special expertise with respectto an environmental, a social, or an economic impactinvolved in the operation; or
(B) may develop and enforce environmental standards withrespect to those operations.
(b) A person described in subsection (a) may do the following:
(1) File written objections to the proposed release from bondwith the director.
(2) Request a public hearing within thirty (30) days after thelast publication of the notice required by section 7 of thischapter.
As added by P.L.1-1995, SEC.27. Amended by P.L.71-2004, SEC.27.
IC 14-34-6-11
Public hearing
Sec. 11. (a) If written objections are filed and a hearing requestedunder section 10 of this chapter, the director shall do the following:
(1) Inform all the interested parties of the date, time, andlocation of the hearing.
(2) Advertise the information in a newspaper of generalcirculation in the county where the surface coal mining andreclamation operation proposed for bond release is located one(1) time each week for two (2) consecutive weeks.
(b) The director shall hold the public hearing in accordance withIC 14-34-4-5:
(1) in the county where the surface coal mining and reclamationoperation proposed for bond release is located; or
(2) at the state capital;
at the option of the objector, within thirty (30) days of the request forthe hearing.
(c) At a hearing held under this section, the director may inspectthe land affected and other surface coal mining operations carried onby the applicant in the vicinity. (d) The director shall notify the permittee in writing of thedecision and findings of the hearing within thirty (30) days of thecompletion of the hearing.
(e) The director's decision is subject to IC 4-21.5.
As added by P.L.1-1995, SEC.27.
IC 14-34-6-12
Informal conference
Sec. 12. Without prejudice to the rights of the objectors undersection 10 of this chapter or the applicant, the director may providefor an informal conference to resolve the written objections.
As added by P.L.1-1995, SEC.27.
IC 14-34-6-13
Schedule for release of bond or deposit
Sec. 13. The director may release the bond, deposit, or letter ofcredit in whole or in part if the director is satisfied that thereclamation covered by the bond or deposit or part of the bond ordeposit has been accomplished as required by this article accordingto the following schedule:
(1) When the operator completes the backfilling, regrading, anddrainage control of a bonded area in accordance with theapproved reclamation plan, the release of sixty percent (60%)of the bond or collateral for the applicable permit area.
(2) After revegetation is established on the regraded mined landin accordance with the approved reclamation plan. Whendetermining the amount of bond to be released after successfulrevegetation has been established, the director shall retain theamount of bond for the revegetated area that would be sufficientfor a third party to cover the cost of establishing revegetationand for the period specified for operator responsibility inIC 14-34-10 of establishing revegetation. The director may notrelease a part of the bond or deposit under this subdivision:
(A) if the land to which the release would be applicable iscontributing suspended solids to stream flow or runoffoutside the permit area in excess of the requirements setforth in IC 14-34-10-2(b)(13); or
(B) until soil productivity for prime farmland has returned toequivalent levels of yield as nonmined land of the same soiltype in the surrounding area under equivalent managementpractices as determined from the soil survey performedunder IC 14-34-3-3(16).
If a silt dam is to be retained as a permanent impoundmentunder IC 14-34-10-2(b)(11), the appropriate part of the bondmay be released under this subdivision if provisions for soundfuture maintenance by the operator or the landowner are madewith the director.
(3) When the operator has successfully completed all surfacecoal mining and reclamation activities, the release of theremaining part of the bond, but not before the expiration of the
period specified for operator responsibility in IC 14-34-10.However, the director may not fully release a bond or deposituntil all reclamation requirements of this article are fully met.
As added by P.L.1-1995, SEC.27.
IC 14-34-6-14
Notification of decision
Sec. 14. (a) If a public hearing requested under section 10 of thischapter is not held, the director shall notify the permittee in writingof the decision on the application or bond release within sixty (60)days of the filing of the application.
(b) If the director disapproves the application for release of thebond or part of the bond, the director shall notify the permittee, inwriting, stating the following:
(1) The reasons for disapproval.
(2) A recommendation as to the corrective actions necessary tosecure the release.
(3) Allowing an opportunity for a public hearing in accordancewith IC 4-21.5-3.
As added by P.L.1-1995, SEC.27.
IC 14-34-6-14.3
Release of bond covering undisturbed area
Sec. 14.3. The director may release the bond, deposit, or letter ofcredit covering an area that has not been disturbed by surface coalmining activities. A release under this subsection is not subject to thepublic notice and hearing requirements set forth in sections 7 through14 of this chapter.
As added by P.L.176-1995, SEC.6.
IC 14-34-6-14.6
Release of bond covering disturbed area
Sec. 14.6. (a) This section applies when an applicant or permitteesubmits a bond, deposit, or letter of credit covering an area that:
(1) has been disturbed by surface coal mining activities; and
(2) is covered by another bond, deposit, or letter of creditpreviously submitted by another permittee.
(b) Except as provided in subsection (c), in a situation describedin subsection (a):
(1) the bond, deposit, or letter of credit previously submittedshall be released when the director accepts the bond, deposit, orletter of credit submitted by the applicant or permittee; and
(2) the bond, deposit, or letter of credit submitted by theapplicant or permittee:
(A) is subject to the standards set forth in sections 7 through14 of this chapter; and
(B) may not be released under section 14.3 of this chapter.
(c) If two (2) or more persons who are applicants or permitteeseach file a bond, deposit, or letter of credit covering the same area,the persons may enter into a written agreement that allocates
responsibility among the persons for the reclamation of the area. Ifthe agreement is approved by the director, the agreement governs therespective responsibilities of the persons for the reclamation of thearea.
As added by P.L.176-1995, SEC.7.
IC 14-34-6-15
Abandoned mine reclamation fund
Sec. 15. (a) As used in this section, "fund" refers to the post-1977abandoned mine reclamation fund established by this section.
(b) The post-1977 abandoned mine reclamation fund isestablished. The fund consists of bond forfeiture money collectedunder section 16 of this chapter and the civil penalties described inIC 14-34-16-9. The fund may be used as follows:
(1) To effect the restoration of land not otherwise eligible forfederal funding on which there has been surface mining activityafter August 3, 1977.
(2) To replace domestic water supplies disrupted or affected bya surface coal mining and reclamation operation, including thedisposal of coal combustion waste (as defined in IC 13-19-3-3),where the surface coal mining and reclamation operation hasbeen completed and is no longer subject to IC 14-34.
The money held for this purpose may not exceed an amountestablished by the department that is sufficient to enable the directorto cover the anticipated cost of restoration.
(c) At least five hundred thousand dollars ($500,000) in the fundis dedicated as collateral for the bond pool under IC 14-34-8 and maynot be used for the restoration of land or replacement of waterdescribed in subsection (b).
(d) The treasurer of state shall invest the money in the fund notcurrently needed to meet the obligations of the fund in the samemanner as other public money may be invested. Interest that accruesfrom these investments shall be deposited in the fund.
(e) Money in the fund at the end of a state fiscal year does notrevert to the state general fund.
As added by P.L.1-1995, SEC.27. Amended by P.L.63-1999, SEC.1.
IC 14-34-6-16
Forfeiture of bond
Sec. 16. (a) The director may order the forfeiture of all or part ofa bond for a permit area or an increment of a permit area, regardlessof whether the entire area has been disturbed by surface miningactivities, if:
(1) the permittee does not conduct reclamation operations inaccordance with the applicable reclamation plan; or
(2) the permittee does not fulfill at least one (1) of theconditions under which the bond was posted.
(b) An order issued under subsection (a) or under IC 13-4.1-6-9(a)(before its repeal) is subject to IC 4-21.5-3-6 and becomes aneffective and final order of the director without a proceeding if a
request for review of the order is not filed with the director withinfifteen (15) days after the order is served upon:
(1) the permittee; and
(2) the person that executed the permittee's bond or otherperformance guarantee if the permittee filed a bond or otherperformance guarantee under this chapter.
(c) If the forfeited bond is insufficient to pay the entire cost ofreclamation, the permittee shall pay the uncompensated balancenecessary for complete reclamation as determined by the director.
(d) If the amount of the forfeited bond exceeds the amountnecessary for complete restoration, the excess amount shall bereturned by the director to the person from whom the amount wasreceived.
(e) A person who has forfeited a bond may not be given a permituntil:
(1) the land subject to the forfeiture has been reclaimed withoutcost to the state; or
(2) the department has received an amount of money equal tothe amount determined by the director to be necessary toreclaim the land.
(f) Money collected under this section is appropriated and allottedto the department, at the time of deposit, for restoration of the sitefrom which the bond was forfeited.
As added by P.L.1-1995, SEC.27.