Guam § 76115 - Financial Responsibility.

§ 76115. Financial Responsibility.

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(a) All owners and operators of UST systems, within one hundred

eighty (180) days of the effective date of this Chapter, shall establish and

maintain evidence of financial responsibility, as provided for in this Section,

for taking corrective action and compensating third parties for bodily injury

and property damage caused by accidental releases arising from the

operation of underground storage tanks in at least the following per

occurrence amounts:

(1) For all owners or operators of petroleum underground storage

tanks that are located at petroleum marketing facilities, or that own or

operate five (5) or more tanks, or that handle an average of more than

ten thousand (10,000) gallons of petroleum per month based on annual

throughput for the previous calendar year: $2,000,000.

(2) For all other owners or operators of petroleum underground

storage tanks: $500,000.

(b) Owners or operators of petroleum underground storage tanks shall

demonstrate financial responsibility for taking corrective action and for

compensating third parties for bodily injury and property damage caused by

accidental release arising from the operation of petroleum underground

storage tanks in at least the following annual aggregate amounts:

(1) For owners or operators of four (4) or fewer tanks, an annual

aggregate amount of $1,000,000.

(2) For owners or operators of five (5) or more tanks, an annual

aggregate amount of $2,000,000.

(3) For owners and operators of ten (10) or more tanks, an annual

aggregate amount of at least $2,000,000, or such other higher aggregate

amount as set forth in regulations promulgated by the Administrator.

(c) Subject to the approval of the Administrator, an owner or operator

of a UST shall establish evidence of financial responsibility by any one, or a

combination of, the following methods in accordance with the rules and

regulations promulgated by the Administrator:

(1) commercial or private insurance, including, risk retention

group;

(2) qualification as a self-insurer as specified in Subsection (f) of

this Section;

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(3) a guarantee, surety bond, or letter of credit; or

(4) any other reasonable and economically practicable means.

(d) The Administrator shall not approve any financial responsibility

method or combination of methods, unless the owner or operator has

demonstrated that such method(s):

(1) are valid and enforceable;

(2) are issued by a provider that is qualified or licensed in Guam;

(3) do not permit cancellation without allowing the Administrator

to draw funds;

(4) shall only be directly used for corrective action and third

party liability costs; and

(5) require the provider to notify the owner or operator and the

Administrator of any circumstances that would impair or suspend

coverage.

(e) Surety bonds shall be payable to the Guam Environmental

Protection Agency, to include costs and expenses of the cleanup of any

release, as well as, damages incurred by the government, consistent with the

provisions of this Chapter. Any bond filed with the Agency must be issued

by a bonding company authorized to do business within Guam. The Guam

EPA is authorized to establish a special account, escrow, standby trust, or

other trust or account mechanism into which funds established as financial

assurance may be deposited when needed. Notwithstanding any other

provision of law, the Administrator may retain and use such amounts for the

purposes for which the financial assurance was established.

(f) To qualify as a self-insurer, the UST system owner or operator

shall:

(1) demonstrate a tangible net worth of at least ten (10) times:

(A) the total of the aggregate amount required in Subsection

(c) of this Section;

(B) the sum of the corrective action cost estimates, the

current closure and post-closure care cost estimates, and the

amount of liability coverage required under this Chapter; and

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(C) the sum of plugging and abandonment cost estimates in

effect for which a financial test is used to demonstrate financial

responsibility under this Chapter.

(2) The owner or operator shall have a tangible net worth of at

least $10,000,000.

(3) The owner or operator shall meet the requirements set forth in

40 CFR 280.95.

(g) The total liability of any guarantor is limited to the aggregate

amount that the guarantor has provided as evidence of financial

responsibility to the UST system owner or operator under this Section.

Nothing in this Subsection shall be construed to limit any other territorial or

federal statutory, contractual or common law liability of a guarantor to its

owner or operator, including, but not limited to, the liability of such

guarantors for bad faith either in negotiating or in failing to negotiate the

settlement of any claim. For the purpose of this Subsection, the term

“guarantor” means any person, other than the owner or operator, who

provides evidence of financial responsibility for an owner or operator

pursuant to this Section.

(h) Any claim costs incurred by the Agency for taking emergency,

preventive, corrective or enforcement action may be filed directly against the

bonding company, the insurer, the guarantor, or any other person providing

evidence of financial responsibility. Any amount collected or awarded under

this Subsection shall be paid into the Guam Environmental Protection

Agency’s UST-LUST Fund.

(i) An owner or operator of an UST system shall designate a person

within Guam as his/her resident agent for service of process, and such

designation shall be filled in accordance with rules and regulation

promulgated by the Agency.

(j) The financial responsibility amounts required by this Section, or

any portion of such amount, may be satisfied by utilization of the Guam

Environmental Protection Agency’s UST-LUST Fund.