Section 880-X-9B-.02 - Determination Of Bond Amount (Alabama Administrative Code)

§ 880-X-9B-.02. Determination Of Bond Amount

(1) The amount of the performance bond shall be determined by the State Regulatory Authority and shall be the estimated cost to the State Regulatory Authority if it had to perform the reclamation, restoration, and abatement work required of the operator under the Act, these regulations, and the terms of the permit. The amount of the bond shall reflect the probable difficulty of reclamation based on site specific factors such as topography, geology, hydrology, and revegetation potential. Consideration shall also be given, but not limited to:

(a) The estimated costs submitted by the permittee in accordance with Rules 880-X-8F-.09 and 880-X-8I-.08.

(b) The additional estimated costs to the State Regulatory Authority which may arise from applicable public contracting requirements or the need to bring personnel and equipment to the permit area after its abandonment by the permittee to perform reclamation, restoration, and abatement work.

(2) The bond amount for acreage bonded initially under a permit, any acreage added to the permit, and any succeeding incremental bonds shall be computed in accordance with the adjusted base reclamation costs in effect at the time that acreage is added for bond coverage. Bonds covering unreclaimed acreage may be adjusted annually to reflect inflationary or deflationary changes in reclamation costs, but shall be specifically reviewed during the permit review process.

(3) The bond amount per acre for the proposed permit or increment will be computed in the following manner:

(a) A statewide base reclamation cost will be established reflecting the lowest cost which can be expected under ideal conditions and shall be modified annually to reflect inflationary or deflationary price adjustments. Two base cost categories will be established:

1. Base Grading Cost - This cost will reflect regrading of spoil under ideal conditions with no topsoil replacement and no highwall elimination.

2. Base Revegetation Cost - This cost will reflect revegetation costs for each postmine land use category under ideal conditions.

(b) For each permit the base grading and base revegetation costs will be increased if appropriate to reflect site specific conditions which can be expected to add to reclamation costs. The following adjustments will be made:

1. Adjustments to Base Grading Cost --

(i) Topography - Grading cost will be increased, if appropriate, based on slope conditions of the proposed permit area.

(ii) Geology - Grading cost will be increased, if appropriate, to reflect the hardness and amount of sandstone on the proposed permit area.

(iii) Highwall elimination - Grading cost will be increased, if applicable, to reflect the estimated cost of eliminating the maximum highwall which could be present on the proposed increment to be bonded.

(iv) Prime farmland reconstruction. Grading cost will be increased to reflect the cost of prime farmland reconstruction if applicable to the permit area.

2. Adjustments to Base Revegetation Cost --

(i) pH of topsoil or topsoil substitute - Base revegetation cost will be increased to reflect the cost of adjusting the pH of the topsoil or topsoil substitute on the proposed permit area to a level suitable for the proposed vegetation.

(ii) Topsoil replacement - Base revegetation cost will be increased to reflect the cost of replacing topsoil or topsoil substitute if applicable to the permit area.

(iii) Topography - The base revegetation cost will be increased to reflect the estimated increase in cost for revegetation due to the topography to the proposed permit area.

3. Adjustment for Probable Hydrologic Consequences - The bond amount for the permit will be increased to reflect additional reclamation costs due to probable impact of the proposed mining on the hydrology of the area.

4. Dismantling Costs for Surface Facilities - An adjustment shall be made to the bond amount to reflect the cost of dismantling surface facilities.

5. Cost Adjustment for Public Contracting Requirements and Contractor Mobilization - the bond amount will be increased to reflect costs to the State Regulatory Authority for contract preparation and control, and costs covering contractor mobilization and profit.

(c) The total bond amount per acre for the proposed permit or increment shall be the sum of the base grading and revegetation costs plus all adjustments.

(4) In accordance with Rule 880-X-8J-.03, abandoned surface mined lands may be included in a new permit and used for off-site spoil placement and shall not require additional bond coverage. The entire permit area, including the abandoned surface mined area, shall be deemed to have bond coverage and considered when determining bond release and forfeiture under Rules 880-X-9D and 880-X-9E.

Author:

Statutory Authority: Code of Ala. 1975, §§ 9-16-71, 73, 74, 75, 80, 81, 82, 83, 84, 85, 89, 90, 91.

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