OHIO REGULATORY PROGRAM

OHIO ADMINISTRATIVE CODE [OAC]
1501:13 DIVISION OF MINES AND RECLAMATION - COAL [Current as of January 2002]

CHAPTER 1501:13-7   BONDING
   OAC 1501:13-7-01           General requirements for bonding of coal mining and reclamation
                              operations
   OAC 1501:13-7-02           Amount and duration of performance bond
   OAC 1501:13-7-03           Form, conditions, and terms of performance bonds
   OAC 1501:13-7-04           Self-bonding
   OAC 1501:13-7-05           Procedures, criteria, and schedule for release of performance bond
   OAC 1501:13-7-06           Performance bond forfeiture criteria and procedures
   OAC 1501:13-7-07           Liability insurance
   OAC 1501:13-7-08           Bond release conference


NOTE: Cross references to OSM's federal statute and regulation sections appear in double braces to the right of the
Ohio statute or regulation section numbers, e.g., "OAC 1501:13-7-04   SELF-BONDING.    {{ 30 CFR 800.23 }}".
The cross references were compiled using the preambles to OSM's approval of amendments to the Ohio regulatory
program published in the Federal Register and from the COALEX Library in LexisNexis.


1501:13-7-01   GENERAL REQUIREMENTS FOR BONDING OF COAL MINING AND
               RECLAMATION OPERATIONS. 
          {{ 30 CFR 780.14, 800.11, 800.13, 800.15, 800.16, 800.40 }}
(A)  Requirement to file a bond. 
     (1)  After an application for a permit to conduct coal mining and reclamation operations has been approved
under these rules, but before such permit is issued, the applicant shall file with the chief a performance bond in
compliance with these rules. The permittee or applicant shall file a performance bond for: 
          (a)  The number of acres in the entire area to be permitted; or 
          (b)  The estimated number of acres to be affected in the first permit year and comply with the
requirements of paragraph (A)(6) of this rule. 
     (2)  No person shall disturb surface acreage, either by coal mining and reclamation operations conducted on
the surface of land or as a result of surface impacts incidental to an underground coal mine, prior to filing with the
chief a performance bond covering the number of acres to be affected. 
     (3)  Liability on the performance bond shall cover all coal mining and reclamation operations to be
conducted within the permit area until the end of the permittee's period of reclamation responsibility. 
     (4)  No area affected by a coal mining and reclamation operation within a permit shall be identified with a
specific performance bond. 
     (5)  Surety bonds, certificates of deposit, cash and letters of credit shall apply to the permit area and to all
revisions to the permit, including incidental boundary revisions and adjacent area permits. 
     (6)  Incremental bonding. When a permittee or applicant elects to file performance bond incrementally: 
          (a)  The permittee or applicant shall as part of the permit application process: 
               (i)  Submit to the chief a written estimate of the number of acres to be affected in the first
permit year; and 
               (ii)  Before the permit is issued, file with the chief performance bond for the estimated
number of acres to be affected in the first permit year; 
          (b)  Thirty days before affecting more than the number of acres for which performance bond has
been filed with the chief, the permittee shall file additional performance bond for the number of additional acres to
be affected in the permit year; 
          (c)  The permittee shall within thirty days after the end of every permit year: 
               (i)  Identify on the annual map each incremental area for the first through most recent
permit year in accordance with the requirements governing the preparation of annual maps; and 
               (ii)  File performance bond with the chief, concurrently with the submittal of the annual
map, if the number of acres shown as affected and estimated to be affected on the annual map exceeds the number of
acres bonded; 
          (d)  Performance bond posted and not yet released for any incremental area can be forfeited, in
whole or part, to perform the requirements of Chapter 1513. of the Revised Code on any area affected by the
permittee pursuant to the permit; and 
          (e)  After a permit is issued, a permittee who has chosen incremental bonding may change his
method of bonding and file the entire performance bond required during the term of the permit, but a permittee who
has filed the entire performance bond required during the term of the permit may not change to incremental bonding. 
     (7)  A permittee who has filed performance bond for the entire permit area instead of filing performance
bond incrementally shall identify an incremental area at the end of each permit year in the manner prescribed in
paragraph (A)(6)(c)(i) of this rule and may obtain release of performance bond by incremental area, pursuant to rule
1501:13-7-05 of the Administrative Code. 

(B)  Release of excess bond. 
     (1)  If, upon receipt by the chief of the annual map and annual report, the number of acres affected is less
than the number of acres bonded, the permittee may obtain a release of the excess bond provided the permittee
submit a request for release of excess bond to the chief on a form provided by the chief. 
     (2)  If, upon receipt by the chief of the final map and final report, the number of acres affected is less than
the number of acres bonded, the chief shall release the excess bond to the permittee. 

(C)  Responsibilities of the chief. 
     (1)  The chief shall prescribe and furnish forms for filing performance bonds. 
     (2)  The chief shall determine the amount of the performance bond required for the permit area as land
acreages in the permit area are revised. 
     (3)  The chief may not accept a self-bond in lieu of a surety or collateral bond unless the permittee meets the
requirements of rule 1501:13-7-04 of the Administrative Code. 
     (4)  The chief shall release the permittee from his bond obligations in accordance with rule 1501:13-7-05 of
the Administrative Code. 
     (5)  The chief shall cause all or part of a bond to be forfeited in accordance with rule 1501:13-7-06 of the
Administrative Code. 
     (6)  The chief shall require as a condition of the permit that adequate bond coverage be in effect at all times. 

HISTORY: Eff 5-18-81; 8-16-82 (Emer.); 10-27-82; 6-30-83; 10-1-88; 10-22-90
Rule promulgated under: RC Chapter 119.
Rule amplifies: RC 1513.08 
119.032 Review Date: 11-1-98, 11-1-03 


OAC 1501:13-7-02    AMOUNT AND DURATION OF PERFORMANCE BOND. 
               {{ 30 CFR 800.13, 817.121 }}
(A)  Bond amount. 
     (1)  For those acres shown as affected (and circumscribed by a solid orange line as required by paragraph
(B)(3) rule 1501:13-4-10 of the Administrative Code) on an annual map required to be submitted within thirty days
after a permit-issuance anniversary date coming on or after April 9, 1981 and before April 9, 1982, the bond amount
shall be that set by the chief at the time of approval of the permit application. 
     (2)  The amount of the bond shall be two thousand five hundred dollars per acre for: 
          (a)  Acreage covered by a permit issued on or after April 9, 1981; 
          (b)  Acreage covered by an amendment to a permit, which amendment is issued on or after April 9,
1981, regardless of when the permit was issued; or 
          (c)  Acreage which is covered by a permit issued before April 9, 1981 and is both: 
               (i)  To be affected after April 9, 1981; and 
               (ii)  Outside those acres referred to in paragraph (A)(1) of this rule. 
     (3)  An operator's financial responsibility under paragraph (D) of rule 1501:13-12-03 of the Administrative
Code for repairing material damage resulting from subsidence may be satisfied by the liability insurance policy
required under rule 1501:13-7-07 of the Administrative Code. 

(B)  Minimum amount. The amount of the bond for coal mining and reclamation operations shall be ten thousand
dollars at a minimum for the entire area under one permit and the minimum amount shall be maintained on deposit
until such time as the permittee is released from all liability in accordance with rule 1501:13-7-05 of the
Administrative Code. 

(C)  Period of liability 
     (1)  Liability under a performance bond or bonds applicable to a permit shall continue until all reclamation
and restoration work under requirements of Chapter 1513. of the Revised Code, these rules, and the provisions of the
mining and reclamation plan has been completed, the period of extended responsibility for revegetation has expired
in accordance with rule 1501:13-9-15 of the Administrative Code, and the permittee is released from liability in
accordance with rule 1501:13-7-05 of the Administrative Code. 
     (2)  The bond liability of the permittee shall include only those actions which the permittee is obligated to
take under the permit, Chapter 1513. of the Revised Code and these rules, including completion of the reclamation
plan, so that the land will be capable of supporting the postmining land use approved under rule 1501:13-9-17 of the
Administrative Code. 
     (3)  Implementation of an alternative postmining land use approved under paragraph (D) of rule 1501:13-9-
17 of the Administrative Code which is beyond the control of the permittee, need not be covered by the bond. 

(D)  Adjustment of amount. The amount of the performance bond liability applicable to a permit shall be adjusted by
the chief as the acreage in the permit area is revised. The chief shall notify persons involved in bond coverage of any
proposed bond adjustments. For purposes of this rule a person involved in bond coverage shall include the permittee,
and surety, and any other person with a property interest in collateral posted under these rules who has in writing to
the chief requested such notification at the time the collateral is posted or the interest is acquired, whichever occurs
later. 

HISTORY: Eff 5-18-81; 10-27-82; 10-1-88
Rule promulgated under: RC Chapter 119.
Rule amplifies: RC 1513.08 
119.032 Review Date: 11-1-98, 11-1-03


OAC 1501:13-7-03    FORM, CONDITIONS, AND TERMS OF PERFORMANCE BONDS. 
               {{ 30 CFR 800.16, 800.21, 800.23 }}
(A)  Form of the performance bond. The performance bond to be submitted by the applicant or permittee shall be on
forms furnished by the chief. The chief shall allow for: 
     (1)  A surety bond; 
     (2)  A collateral bond; 
     (3)  Self-bonding; or 
     (4)  A combination of any of these bonding methods. 

(B)  Terms and conditions of the bond. 
     (1)  The performance bond shall be in an amount determined by the chief as provided in paragraphs (A) and
(B) of rule 1501:13-7-02 of the Administrative Code. 
     (2)  The performance bond shall be payable to the state. 
     (3)  The performance bond shall be conditioned upon faithful performance of all the requirements of
Chapter 1513. of the Revised Code, the rules adopted pursuant thereto, and the provisions of the applicant's
approved mining and reclamation plan. 
     (4)  The duration of the bond shall be that described in paragraph (C) of rule 1501:13-7-02 of the
Administrative Code. 
     (5)  Surety bonds shall be subject to the following conditions: 
          (a)  The chief shall not accept the bonds of a surety company unless the bond is noncancellable by
the surety at any time for any reason including, but not limited to, non-payment of premium or bankruptcy of the
permittee during the period of liability; 
          (b)  The chief shall not accept a surety bond in excess of ten per cent of the surety company's
capital surplus account; 
          (c)  The chief shall not accept a surety bond from a surety company for any operator if the sum of
such bond and all other surety bonds issued by the surety company on any and all the permits of that operator is in
excess of thirty percent of the surety company's capital surplus account; 
          (d)  The chief may provide in the bond that the amount shall be confessed to judgment upon
forfeiture as provided in section 2323.13 of the Revised Code; 
          (e)  The bond shall provide that the surety and the permittee shall be jointly and severally liable; 
          (f)  The bond shall provide that: 
               (i)  The surety will give prompt notice to the permittee and the chief of any notice
received or action filed alleging the insolvency or bankruptcy of the surety, or alleging any violation of regulatory
requirements which could result in suspension or revocation of the surety's license to do business; and 
               (ii)  In the event the surety becomes unable to fulfill its obligations under the bond for any
reason, notice shall be given immediately to the permittee and the chief; and 
          (g)  Upon the incapacity of a surety by reason of bankruptcy, insolvency, or suspension or
revocation of its license, the permittee shall be deemed to be without bond coverage in violation of paragraph (A) of
rule 1501:13-7-01 of the Administrative Code and shall promptly notify the chief. The chief, upon notification from
the surety under paragraph (B)(5)(f) of this rule or from the permittee, shall notify in writing the operator who is
without bond coverage. The notification shall specify a reasonable period to replace bond coverage not to exceed
ninety days. If bond coverage is not replaced within the period set forth in the notification, the chief shall cease all
coal extraction being conducted under the permit and the operator shall immediately begin to conduct reclamation
operations in accordance with the reclamation plan. Mining operations shall not resume until the chief has
determined that an acceptable bond has been posted in accordance with paragraph (A) of rule 1501:13-7-01 of the
Administrative Code. 
     (6)  Collateral bonds, except for letters of credit, shall be subject to the following conditions: 
          (a)  The chief shall deliver to the treasurer of state all collateral deposited by the permittee or
applicant to be held until authorized for release or replacement as provided in these rules. The treasurer shall hold in
it trust for the purposes for which it has been deposited; 
          (b)  The chief shall value collateral at their current market value, not face value; 
          (c)  The chief shall not accept a certificate of deposit unless it is payable to the state, in writing,
and upon the books of the bank issuing such certificates; 
          (d)  The chief shall not accept an individual certificate or cash account for a denomination in
excess of the maximum insurable amount as determined by F.D.I.C. and F.S.L.I.C.; 
          (e)  The chief shall only accept automatically renewable certificates of deposit; 
          (f)  The chief shall require the applicant to deposit sufficient amounts of certificates of deposit to
assure that upon forfeiture the chief will be able to liquidate those certificates prior to maturity for the amount of the
bond required by rules 1501:13-7-01 to 1501:13-7-06 of the Administrative Code; and 
          (g)  Certificates of deposit may be substituted for a cash account with the approval of the chief. 
     (7)  Letters of credit shall be subject to the following: 
          (a)  The letter may only be issued by a bank organized or authorized to do business in the United
States; 
          (b)  Letters of credit shall be irrevocable during their terms. Letters of credit used as security in
areas requiring continuous bond coverage shall be replaced, at least thirty days before the expiration date of the letter
of credit agreement, by other letters of credit, other forms of security supporting the collateral bond indemnity
agreement, or another form of performance bond. If the letters of credit are not replaced at least thirty days prior to
the expiration date, the chief shall demand and obtain payment on them before they expire; 
          (c)  The letter shall be payable to the state, in part or in full, upon written demand by the chief and,
except as provided in paragraph (B)(7)(b) of this rule, accompanied by a written statement signed by the chief
declaring that the operator has not faithfully performed all of the requirements of Chapter 1513. of the Revised Code,
the rules adopted pursuant thereto, and the provisions of the applicant's approved mining and reclamation plan; 
          (d)  The chief may require in the indemnity agreement that the amount shall be confessed in
judgment upon forfeiture as provided in section 2323.13 of the Revised Code; 
          (e)  The letters of credit shall provide that: 
               (i)  The bank will give prompt notice to the permittee and the chief of any notice received
or action filed alleging the insolvency or bankruptcy of the bank, or alleging any violations of regulatory
requirements which could result in suspension or revocation of the bank's charter or license to do business; and 
               (ii)  In the event the bank becomes unable to fulfill its obligations under the letter of credit
for any reason, notice shall be given immediately to the permittee and the chief; and 
          (f)  Upon the incapacity of a bank by reason of bankruptcy, insolvency, or suspension or
revocation of its charter or license, the permittee shall be deemed to be without performance bond coverage in
violation of paragraph (A) of rule 1501:13-7-01 of the Administrative Code. The chief shall notify in writing any
permittee who is without bond coverage. The notification shall specify a reasonable period to replace bond coverage
not to exceed ninety days. If bond coverage is not replaced within the period set forth in the notification, the chief
shall cease all coal extraction being conducted under the permit and the operator shall immediately begin to conduct
reclamation operations in accordance with the reclamation plan. Mining shall not resume until the chief has
determined that an acceptable bond has been posted, in accordance with paragraph (A) of rule 1501:13-7-01 of the
Administrative Code. 
     (8)  The estimated bond value of all collateral posted as bond assurance under paragraphs (B)(6) and (B)(7)
of this rule shall be subject to a margin, determined by the chief, reflecting legal and liquidation fees, as well as value
depreciation, marketability, and fluctuations which might affect the net cash available to the chief in performing
reclamation. The bond value of collateral may be evaluated at any time, but it shall be evaluated as part of permit
renewal and if necessary the performance bond amount increased or decreased. 
     (9)  Persons with an interest in collateral posted as a bond, and who desire notification of actions pursuant
to the bond, shall request the notification in writing to the chief at the time collateral is offered. 

(C)  Replacement of bonds. 
     (1)  The chief may allow the permittee to replace existing surety or collateral bonds or self-bonds with other
surety or collateral bonds, if the liability which has accrued against the permittee on the permit area is transferred to
such replacement bonds. 
     (2)  The chief may allow the permittee to replace existing surety or collateral bonds with a self-bond,
provided that the permittee meets the requirements of self-bonding as provided in these rules. 
     (3)  The chief shall not release existing performance bonds until the permittee has submitted and the chief
has approved acceptable replacement performance bonds. A replacement of performance bonds pursuant to
paragraph (C) of this rule shall not constitute a release of bond. 

HISTORY: Eff 9-1-77; 5-1-80; 5-18-81; 8-16-82 (Emer.); 10-27-82; 6-30-83; 11-26-86 (Emer.); 
1-12-87 (Emer.); 3-27-87; 10-1-88
Rule promulgated under: RC Chapter 119.
Rule amplifies: RC 1513.08 
119.032 Review Date: 11-1-98, 11-1-03


OAC 1501:13-7-04    SELF-BONDING.                 {{ 30 CFR 800.23 }}
(A)  Definitions for the purposes of this rule only: 
     (1)  "CURRENT ASSETS" means cash or other assets or resources which are reasonably expected to be
converted to cash or sold or consumed within one year or within the normal operating cycle of the business. 
     (2)  "CURRENT LIABILITIES" means obligations which are reasonably expected to be paid or liquidated
within one year or within the normal operating cycle of the business. 
     (3)  "FIXED ASSETS" means plants and equipment, but does not include land or coal in place. 
     (4)  "LIABILITIES" means obligations to transfer assets or provide services to other entities in the future as
a result of past transactions. 
     (5)  "NET WORTH" means total assets minus total liabilities and is equivalent to owners' equity. 
     (6)  "PARENT CORPORATION" means a corporation which owns or controls the applicant. 
     (7)  "TANGIBLE NET WORTH" means net worth minus intangibles such as goodwill and rights to patents
or royalties. 

(B)  The chief may accept a self-bond from an applicant for a permit if all of the following conditions are met by the
applicant or its parent corporation guarantor: 
     (1)  The applicant designates a suitable agent to receive service of process in the state where the proposed
coal mining operation is to be conducted. 
     (2)  The applicant has been in continuous operation as a business entity for a period of not less than five
years. "CONTINUOUS OPERATION" shall mean that business was conducted over a period of five years
immediately preceding the time of application. 
          (a)  The chief may allow a joint venture or syndicate with less than five years of continuous
operation to qualify under this requirement, if each member of the joint venture or syndicate has been in continuous
operation for at least five years immediately preceding the time of application. 
          (b)  When calculating the period of continuous operation, the chief may exclude past periods of
interruption to the operation of the business entity that were beyond the applicant's control and that do not affect the
applicant's likelihood of remaining in business during the proposed coal mining and reclamation operations. 
     (3)  The applicant submits financial information in sufficient detail to show that the applicant meets one of
the following criteria: 
          (a)  The applicant has a current rating for its most recent bond issuance of "A" or higher as issued
by either "Moody's Investor Service" or "Standard and Poor's Corporation"; 
          (b)  The applicant has a tangible net worth of at least ten million dollars, a ratio of total liabilities
to net worth of two and one-half times or less, and a ratio of current assets to current liabilities of one and one-fifth
times or greater; or 
          (c)  The applicant's fixed assets in the United States total at least twenty million dollars, and the
applicant has a ratio of total liabilities to net worth of two and one-half times or less, and a ratio of current assets to
current liabilities of one and one-fifth times or greater. 
     (4)  The applicant submits: 
          (a)  Financial statements for the most recently completed fiscal year accompanied by a report
prepared by an independent certified public accountant in conformity with generally accepted accounting principles
and containing the accountant's audit opinion or review opinion of the financial statements with no adverse opinion; 
          (b)  Unaudited financial statements for completed quarters in the current fiscal year; and 
          (c)  Additional unaudited information as requested by the chief. 

(C)  The chief may accept a written guarantee for an applicant's self-bond from a parent corporation guarantor, if the
guarantor meets the conditions of paragraph (B) of this rule as if it were the applicant. Such a written guarantee shall
be referred to as a "corporate guarantee." The terms of the corporate guarantee shall provide for the following: 
     (1)  If the applicant fails to complete the reclamation plan, the guarantor shall do so or the guarantor shall
be liable under the indemnity agreement to provide funds to the chief sufficient to complete the reclamation plan, but
not to exceed the bond amount. 
     (2)  The corporate guarantee shall remain in force unless the guarantor sends notice of cancellation by
certified mail to the applicant and to the chief at least ninety days in advance of the cancellation date, and the chief
accepts the cancellation. 
     (3)  The cancellation may be accepted by the chief if the applicant obtains suitable replacement bond before
the cancellation date or if the lands for which the self-bond, or portion thereof, was accepted have not been
disturbed. 

(D)  The chief may accept a written guarantee for an applicant's self-bond from any corporate guarantor, whenever
the applicant meets the conditions of paragraphs (B)(1), (B)(2) and (B)(4) of this rule, and the guarantor meets the
conditions of paragraphs (B)(1) to (B)(4) of this rule. Such a written guarantee shall be referred to as a "non-parent
corporate guarantee." The terms of this guarantee shall provide for compliance with the conditions of paragraph (C)
of this rule. The chief may require the applicant to submit any information specified in paragraph (B)(3) of this rule
in order to determine the financial capabilities of the applicant. 

(E)  For the chief to accept an applicant's self-bond, the total amount of the outstanding and proposed self-bonds of
the applicant for coal mining and reclamation operations shall not exceed twenty-five per cent of the applicant's
tangible net worth in the United States. For the chief to accept a corporate guarantee, the total amount of the parent
corporation guarantor's present and proposed self-bonds and guaranteed self-bonds for coal mining and reclamation
operations shall not exceed twenty-five per cent of the guarantor's tangible net worth in the United States. For the
chief to accept a non-parent corporate guarantee, the total amount of the non-parent corporate guarantor's present and
proposed self-bonds and guaranteed self-bonds shall not exceed twenty-five per cent of the guarantor's tangible net
worth in the United States. 

(F)  If the chief accepts an applicant's self-bond, an indemnity agreement shall be submitted subject to the following
requirements: 
     (1)  The indemnity agreement shall be executed by all persons and parties who are to be bound by it,
including the parent corporation guarantor, and shall bind each jointly and severally. 
     (2)  Corporations applying for a self-bond, and parent and non-parent corporations guaranteeing an
applicant's self-bond shall submit an indemnity agreement signed by two corporate officers who are authorized to
bind their corporations. A copy of such authorization shall be provided to the chief along with an affidavit certifying
that such an agreement is valid under all applicable federal and state laws. In addition, the guarantor shall provide a
copy of the corporate authorization demonstrating that the corporation may guarantee the self-bond and execute the
indemnity agreement. 
     (3)  If the applicant is a partnership, joint venture or syndicate, the agreement shall bind each partner or
party who has a beneficial interest, directly or indirectly, in the applicant. 
     (4)  Pursuant to rule 1501:13-7-06 of the Administrative Code, the applicant, parent or non-parent corporate
guarantor shall be required to complete the approved reclamation plan for the lands in default or to pay to the chief
an amount necessary to complete the approved reclamation plan, not to exceed the bond amount. The indemnity
agreement shall be confessed to judgment to the amount of the bond as provided in section 2323.13 of the Revised
Code. 

(G)  The chief may require self-bonded applicants, parent and non-parent corporate guarantors to submit an update
of the information required under paragraphs (B)(3) and (B)(4) of this rule within ninety days after the close of each
fiscal year following the issuance of the self-bond or corporate guarantee. 

(H)  If at any time during the period when a self-bond is posted, the financial conditions of the applicant, parent or
non-parent corporate guarantor change so that the criteria of paragraphs (B)(3) and (D) of this rule are not satisfied,
the permittee shall notify the chief immediately and shall within ninety days post an alternate form of bond in the
same amount as the self-bond. Should the permittee fail to post an adequate substitute bond, the provisions of rule
1501:13-7-03 of the Administrative Code shall apply. The operator shall cease coal extraction and shall immediately
begin to conduct reclamation operations in accordance to the reclamation plan. Mining operations shall not resume
until the chief has determined that an acceptable bond has been posted. 

HISTORY: Eff 5-18-81; 10-27-82; 10-1-88; 12-27-90
Rule promulgated under: RC Chapter 119.
Rule amplifies: RC 1513.08(C) 
119.032 Review Date: 11-1-99


OAC 1501:13-7-05    PROCEDURES, CRITERIA, AND SCHEDULE FOR RELEASE OF
                    PERFORMANCE BOND.   {{ 30 CFR 800.13, 800.40, 816.116, 817.116 }}
(A)  Procedures for seeking release of performance bond. 
     (1)  Request for approval of reclamation. After all reclamation, restoration, and abatement work in a
reclamation phase, as defined in paragraph (B)(1) of this rule, is completed on the entire permit area or on an
incremental area, the permittee, or any person authorized to act on his behalf, shall file a request with the chief for
approval of that reclamation. Requests for approval may be filed only at times or during seasons that allow the chief
to evaluate properly the reclamation reported to be completed. 
     (2)  Contents of request for approval of reclamation. 
          (a)  Every request for approval of reclamation for a particular reclamation phase shall state: 
               (i)  The location and the number of acres of land subject to the request; 
               (ii)  The permit number; and 
               (iii)  The amount of performance bond on deposit for the area subject to the request and
the portion sought to be released. 
          (b)  The request for approval of reclamation phase II or any attachments to the request shall also
include: 
               (i)  The results of tests on the soil of the area requested for release for such vegetation-
sustaining factors as potassium, phosphorus, and lime, and a lime recommendation; 
               (ii)  The planting report required under rule 1501:13-9-15 of the Administrative Code; 
               (iii)  The number of acres of the area requested for release that are reclaimed as prime
farmland; and 
               (iv)  Yield data for those acres reclaimed as prime farmland, if appropriate. 
          (c)  The request for approval of reclamation phase III or any attachments to the request shall also
state: 
               (i)  The number of acres of the area requested for release that are reclaimed as prime
farmland; and 
               (ii)  Yield data for those acres reclaimed as cropland, prime farmland, or pasture or
grazing land, if appropriate. 
          (d)  With every request for approval of reclamation for a particular reclamation phase, the
permittee shall submit copies of the letters the permittee has sent to adjoining property owners, local government
bodies, planning agencies, and sewage and water treatment authorities or water companies in the locality in which
the coal mining and reclamation activities took place, notifying them of the permittee's intention to seek release of
performance bond. 
     (3)  At the time that a request for release of performance bond is filed with the chief, the permittee shall
publish an advertisement, described in division (F)(1) of section 1513.16 of the Revised Code, at least once a week
for four successive weeks in a newspaper of general circulation in the locality of the coal mining operation. In
addition to the requirements specified in division (F)(1) of section 1513.16 of the Revised Code, the advertisement
shall contain the permittee's name and shall state that written comments, objections, and requests for a bond release
conference may be submitted to the chief pursuant to rule 1501:13-7-08 of the Administrative Code. The
advertisement shall also provide the address to which, and closing date by which, written comments, objections and
requests for bond release conferences must be sent. Within thirty days after filing a request for release with the chief,
the permittee shall submit a copy of this advertisement to the chief. 
     (4)  After the publication required by paragraph (A)(3) of this rule and prior to the release of bond, the
permittee shall submit to the chief a notarized proof of publication from the newspaper that published the
advertisement. 
     (5)  Inspection by the chief. 
          (a)  Within thirty days after the permittee has complied with the requirements of paragraphs (A)(1),
(A)(2), and (A)(3) of this rule, the chief shall conduct an inspection and evaluation of the reclamation work involved.
The surface owner, or agent or lessee of the surface owner, shall be given notice of such inspection and may
participate with the chief or his authorized representative in making the bond release inspection. 
          (b)  The chief shall consider during inspection and evaluation of the reclamation: 
               (i)  Whether the permittee has met the requirements of Chapter 1513. of the Revised
Code, these rules, any orders issued during mining and reclamation, and the specifications of the approved mining
and reclamation plan; 
               (ii)  The degree of difficulty to complete any remaining reclamation; 
               (iii)  Whether pollution of surface and subsurface water is occurring; 
               (iv)  The probability the pollution will continue or occur again; and 
               (v)  The estimated cost of abating the pollution. 
     (6)  Objections to release of performance bond and request for bond release conference. 
          (a)  Within thirty days after the last newspaper publication of the filing of the request for release,
written objections to the proposed release of performance bond may be filed with the chief by the following persons: 
               (i)  A person with a valid legal interest that might be adversely affected by release of the
performance bond; 
               (ii)  The responsible officer or head of any federal, state, or local government agency that: 
                    (a)  Has jurisdiction by law or special expertise with respect to any
environmental, social, or economic impact involved in the operation; or 
                    (b)  Is authorized to develop and enforce environmental standards with respect to
the operation. 
          (b)  Persons who may file objections under paragraph (A)(6)(a) of this rule may also request a
bond release conference on the proposed release of bond pursuant to rule 1501:13-7-08 of the Administrative Code. 
     (7)  Decision of the chief; notice of review. 
          (a)  The chief shall notify in writing the permittee and any other interested parties of his decision to
approve or disapprove the request for release and his decision to release or not to release all or part of the
performance bond: 
               (i)  Within sixty days after the permittee has filed a request for release and complied with
the requirements of paragraphs (A)(1), (A)(2), and (A)(3) of this rule, if no bond release conference is held pursuant
to paragraph (A)(6)(b) of this rule; or 
               (ii)  Within sixty days after the bond release conference, if a bond release conference is
held pursuant to paragraph (A)(6)(b) of this rule. 
          (b)  If the chief disapproves a request for release, the chief shall notify the permittee in writing,
stating the reasons for disapproval, recommending corrective action necessary to secure release, and informing the
permittee of his right to appeal this decision to the reclamation board of review. 
          (c)  Within thirty days after notification of the final decision of the chief regarding the bond
release, the permittee or any person with an interest that is or may be adversely affected may file an appeal of that
decision with the reclamation board of review. 
          (d)  If the chief intends to release the performance bond, the chief shall notify the municipal
corporation in which the coal mining operation is located by certified mail at least thirty days before release of all or
part of the bond. 
          (e)  The chief shall not release bond until proceedings in review of a decision to release are
terminated or, if rights to administrative and judicial review have not been exercised, until periods allowed for filing
applications for review have expired. 

(B)  Criteria and schedule for release of performance bond. 
     (1)  Reclamation phases defined. 
          (a)  Reclamation phase I shall be determined to be completed when, in accordance with the
approved mining and reclamation plan: 
               (i)  Backfilling and regrading have been completed; and 
               (ii)  Drainage controls have been established. 
          (b)  Reclamation phase II shall be determined to be completed when: 
               (i)  Resoiling is completed and revegetation meets the standards for success for a phase II
bond release in accordance with rule 1501:13-9-15 of the Administrative Code; 
               (ii)  The lands are not contributing suspended solids to stream flow or runoff outside the
permit area in excess of the requirements of division (A)(10) of section 1513.16 of the Revised Code, these rules,
permit conditions, or the mining and reclamation plan; 
               (iii)  With respect to prime farmlands, soil replacement has been carried out in accordance
with the requirements of rule 1501:13-13-03 of the Administrative Code and division (A)(7) of section 1513.16 of
the Revised Code, and soil productivity has returned to the levels of yield required by rule 1501:13-4-12 of the
Administrative Code; and 
               (iv)  The provisions of a plan approved by the chief for the sound future management of
any permanent impoundment by the permittee or landowner are implemented to the satisfaction of the chief. 
          (c)  Reclamation phase III shall be determined to be completed when: 
               (i)  The permittee has successfully completed all coal mining and reclamation operations
in accordance with the approved reclamation plan and has met the phase III revegetation success standards in
accordance with rule 1501:13-9-15 of the Administrative Code; 
               (ii)  The permittee has achieved compliance with the requirements of Chapter 1513. of the
Revised Code, these rules, and the permit; and 
               (iii)  The applicable liability period under rule 1501:13-7-02 of the Administrative Code
has expired. 
     (2)  Approval of reclamation phase. 
          (a)  The chief may approve a request and release liability under performance bonds according to
the schedule set forth in paragraph (B)(3) of this rule only upon the chief's determination that reclamation in a
particular phase is complete on an incremental area or the entire permit area. 
          (b)  The chief may approve release of bond for an incremental area when reclamation in a
particular phase is complete on that incremental area even though such reclamation is not complete on other
incremental areas within the same permit, provided that no release of bond for any acreage within an incremental
area may be approved until reclamation in the applicable phase is complete for all acres within that incremental area. 
          (c)  A portion of an incremental area requiring extended liability because of augmentation or
failure to achieve the crop yields for prime farmland required for phase II release by rule 1501:13-9-15 of the
Administrative Code may be separated from the rest of the incremental area and bonded separately upon approval by
the chief. Before determining that extended liability should apply to only a portion of the incremental area, the chief
shall determine such portion: 
               (i)  Is not significant in extent in relation to the entire area under the bond; and 
               (ii)  Is limited to isolated, distinguishable, and contiguous portions of the bonded area and
does not comprise scattered or intermittent occurrences throughout the bonded area. 
          (d)  If an area is separated under paragraph (B)(2)(c) of this rule, that portion shall be bonded
separately and the applicable period of liability, in accordance with rule 1501:13-7-02 of the Administrative Code,
shall commence anew. The period of liability for the remaining area shall continue in effect without extension. The
amount of bond on the original incremental area may be adjusted in accordance with rule 1501:13-7-02 of the
Administrative Code. 
          (e)  The chief may approve a request for release of performance bond for reclamation phase II on
areas from which temporary sedimentation ponds have not yet been removed, provided all requirements for a phase
II release are met. 
     (3)  Schedule for release. 
          (a)  When reclamation phase I is approved by the chief for an incremental or permit area, the chief
shall release performance bond liability in the amount of fifty per cent of the bond or deposit for the area on which
the reclamation phase I is complete. 
          (b)  When reclamation phase II is approved by the chief for an incremental or permit area, the
chief shall release performance bond liability in an amount not exceeding thirty-five per cent of the original bond or
deposit for the area on which the reclamation phase II is complete. 
          (c)  When reclamation phase III is approved by the chief for an incremental or permit area, the
chief shall release the remaining performance bond liability for the incremental or permit area. 
     (4)  Order of release. With the exception of certificates of deposit and cash, which shall be released in any
manner and order as determined by the chief, other forms of performance bond shall be released under paragraph
(B)(3) of this rule in the order in which they were filed, and according to the following order by type of bond: 
          (a)  Self bond submitted under rule 1501:13-7-04 of the Administrative Code; 
          (b)  The surety bond filed earliest in the permit term, followed by surety bond filed later in the
permit term; 
          (c)  The letter of credit filed earliest in the permit term, followed by letters of credit filed later in
the permit term; and 
          (d)  Any remaining collateral bond, in the order in which it was filed. 

HISTORY: Eff 10-27-82; 10-1-88; 6-14-90; 10-22-90; 8-5-91; 11-27-93
Rule promulgated under: RC Chapter 119.
Rule amplifies: RC 1513.08, 1513.16(F) 
119.032 Review Date: 11-1-99


OAC 1501:13-7-06    PERFORMANCE BOND FORFEITURE CRITERIA AND PROCEDURES. 
               {{ 30 CFR 800.50 }}
(A)  Bond forfeiture criteria. The chief shall forfeit bond under the procedures contained in paragraph (C) of this rule
whenever any of the following criteria applies: 
     (1)  The permittee failed to comply with a notice of violation issued for failure to complete any phase of
reclamation within the time required by the mining and reclamation plan and any time extensions given for good
cause; or 
     (2)  The coal mining and reclamation operations on the area under bond are abandoned; or 
     (3)  The permittee lacks the ability to continue to operate in compliance with the requirements of Chapter
1513. of the Revised Code, these rules, or the permit; or 
     (4)  The permittee defaults on the conditions under which the bond was accepted. 

(B)  Opportunity to show cause why bond should not be forfeited. 
     (1)  Before performance bond is forfeited under the criteria of paragraph (A)(2) or (A)(3) of this rule,
because of abandonment of the coal mining and reclamation operation or inability of the permittee to comply, the
chief shall order the permittee to show cause why the operation should not be deemed abandoned or why the
permittee has the ability to comply with the requirements of Chapter 1513. of the Revised Code. 
     (2)  The show cause order shall: 
          (a)  Identify the coal mining and reclamation operations covered by the bond to be forfeited; 
          (b)  Give notice of the time, date, place, and purpose of the show cause hearing at which the
permittee may show cause why the operation should not be deemed abandoned or why the permittee has the ability to
comply with the requirements of Chapter 1513. of the Revised Code; and 
          (c)  Be issued at least twenty-one days before the show cause hearing is held. 
     (3)  If the chief determines that the show cause order sent by certified mail is not received by the permittee
within seven days after the order is mailed, the chief shall, as soon as possible, publish notice of the date, time, place,
and purpose of the show cause hearing in a newspaper of general circulation in the locality of the operation. 

(C)  Forfeiture procedures. When performance bond is to be forfeited, the chief shall issue a bond forfeiture order to
the permittee. 
     (1)  The chief shall identify in the bond forfeiture order the entire permit area or the incremental area, when
applicable, for which bond is to be forfeited. The order shall include a determination of the forfeiture amount, which
is equal to the difference between: 
          (a)  The number of acres in the entire permit area or the incremental area, when applicable, times
the per acre rate at which the performance bond was filed for that incremental area; and 
          (b)  The amount of bond already released on the entire permit area or the incremental area, when
applicable. 
     (2)  The bond forfeiture order may include the terms of a reclamation agreement with the chief which, if
complied with, shall result in avoidance of the forfeiture. The terms of the agreement shall include performance of
reclamation operations and abatement of all unabated violations in accordance with a compliance schedule which
meets the conditions of the permit, the reclamation plan, Chapter 1513. of the Revised Code and these rules, and a
timetable specified by the chief. 
          (a)  If the permittee fails to enter into a reclamation agreement within twenty days of the issuance
of a bond forfeiture order containing such agreement, the chief shall immediately forfeit the performance bond and
notify the permittee's surety, if applicable, of the permittee's failure to comply. 
          (b)  If the permittee demonstrates to the chief's satisfaction within twenty days of the issuance of a
bond forfeiture order that the permittee has the ability to meet the terms and conditions of the reclamation agreement
contained in the bond forfeiture order, the chief shall monitor compliance with the terms and conditions of the
reclamation agreement. 
               (i)  Upon the permittee's satisfactory performance under the terms and conditions of the
reclamation agreement, the chief shall rescind the bond forfeiture order. 
               (ii)  Upon the permittee's failure to comply with any of the terms or conditions of the
reclamation agreement, the chief shall immediately forfeit the performance bond and notify the permittee's surety, if
applicable, of the permittee's failure to comply. 
          (c)  The surety's time to elect to reclaim under paragraph (E) of this rule shall not begin to run until
the permittee has failed to enter into an agreement under paragraph (C)(2) of this rule or has failed to comply with
the terms of such agreement, and the surety has been notified of such failure. 
     (3)  The bond forfeiture order shall be sent by certified mail, return receipt requested, and shall inform the
permittee and surety of the reasons for the forfeiture. 
     (4)  In the event that the permittee does not enter into a reclamation agreement or fails to comply with the
terms of a reclamation agreement under paragraph (C)(2) of this rule, when performance bond filed with the division
of reclamation for the entire permit area or the incremental area, when applicable, is supported by or in the form of; 
          (a)  Cash, certificates of deposit or negotiable government bonds, then the order shall declare the
cash, certificates of deposit, or negotiable government bonds property of the state; 
          (b)  A letter of credit, then the order shall inform the permittee that the state will immediately draw
on the letter of credit; or 
          (c)  A self-bond, then the order shall inform the permittee that the state will immediately take
appropriate collection actions on the self-bond. 
     (5)  If the performance bond filed with the division of reclamation for the entire permit area or the
incremental area, when applicable, is in the form of a surety bond, the chief shall also issue a bond forfeiture order to
all sureties involved, and, in addition to the requirements of paragraphs (C)(1) and (C)(3) of this rule, the order shall
inform each surety of its rights and the extent of its obligations and liability for the entire permit area or the
incremental area, when applicable. 

(D)  Issuance of a bond forfeiture order does not relieve a permittee from the responsibility for complying, and does
not prevent the permittee from being subject to civil penalties for not complying with any order or notice of violation
issued for conditions existing on the entire permit area or the incremental area, when applicable. 

(E)  Reclamation by the surety. 
     (1)  Within sixty days after it receives a bond forfeiture order, or within sixty days of notification of the
permittee's failure to elect to enter into a reclamation agreement under paragraph (C)(2) of this rule or the permittee's
failure to comply with the terms of a reclamation agreement under paragraph (C)(2) of this rule, each surety: 
          (a)  Shall notify the chief that it will not complete reclamation and shall make payment under the
surety bond for the full amount of its liability under the surety bond; or 
          (b)  Shall notify the chief that it will complete reclamation and shall submit to the chief a plan,
including a timetable for performing reclamation in accordance with the reclamation plan and the requirements of
Chapter 1513. of the Revised Code and these rules. 
     (2)  The chief may allow the surety to complete reclamation if the surety can demonstrate an ability to
complete reclamation in accordance with Chapter 1513. of the Revised Code, these rules and the reclamation plan. 
     (3)  A surety completing a reclamation phase on the entire permit area or the incremental area, when
applicable, may obtain release of its performance bond obligation in the same manner as an operator pursuant to
section 1513.16 of the Revised Code. 
     (4)  The rights of a surety to perform reclamation shall be terminated if the surety fails to: 
          (a)  Notify the chief within sixty days after receipt of the bond forfeiture order, or within sixty days
of notification of the permittee's failure to elect to enter into a reclamation agreement under paragraph (C)(2) of this
rule or the permittee's failure to comply with the terms of a reclamation agreement under paragraph (C)(2) of this
rule, that it will or will not perform reclamation. 
          (b)  Submit a reclamation timetable at the same time it notifies the chief that it will perform
reclamation; or 
          (c)  Commence, continue, or complete reclamation in accordance with the reclamation timetable. 
     (5)  When the chief determines that the rights of a surety shall be terminated, the chief shall issue an order
terminating the rights of the surety and demanding payment from the surety for the entire amount of performance
bond filed with the chief by the surety for the entire permit area or the incremental area, when applicable. 

(F)  Reclamation by the chief. 
     (1)  After receiving the moneys collected under paragraph (C) or (E) of this rule, the chief shall proceed to
reclaim the entire permit area or the incremental area, when applicable, in accordance with: 
          (a)  The requirements of section 1513.18 of the Revised Code if the permit that was forfeited was
not a permanent program permit; or 
          (b)  In accordance with Chapter 1513. of the Revised Code, these rules and the approved
reclamation plan if the permit that was forfeited was a permanent program permit. 
     (2)  Any revisions that the chief wishes to make to the approved reclamation plan of a permanent program
permit on which the bond has been forfeited shall be made in accordance with paragraph (E) of rule 1501:13-4-06 of
the Administrative Code. As used in paragraph (F) of this rule, "PERMANENT PROGRAM PERMIT" means any
permit issued after August 16, 1982, and any permit issued between September 1, 1981 and August 16, 1982 that
was subsequently revised to meet the criteria of the approved program. 
     (3)  If during such reclamation it appears that the cost of reclamation is greater than the performance bond
filed for the incremental area and if there remains on file with the chief performance bond for other incremental areas
which has not already been forfeited under paragraph (C) or (E) of this rule, then the chief may proceed to declare
forfeit the remaining bond and collect moneys under the bond up to an amount equal to the difference between the
actual costs of reclamation and moneys already collected under paragraph (C) or (E) of this rule. 

HISTORY: Eff 4-2-82; 10-27-82; 10-1-88; 12-27-90; 1-1-93
Rule promulgated under: RC Chapter 119.
Rule amplifies: RC 1513.16(G) 
119.032 Review Date: 11-1-99


OAC 1501:13-7-07    LIABILITY INSURANCE.               {{ 30 CFR 800.60 }}
(A)  An application for a permit shall contain a certificate issued by an insurance company authorized to do business
in this state certifying that the applicant has a public liability insurance policy in force for those coal mining and
reclamation operations for which the permit is sought or evidence that the applicant has satisfied other state self-
insurance requirements or, for reclamation operations, evidence that an agent performing reclamation for the
applicant has a public liability insurance policy. 

(B)  The public liability insurance policy shall: 
     (1)  Be in effect during the term of the permit or any renewal, including the length of all reclamation
operations; 
     (2)  Provide for personal injury and property damage protection in amounts adequate to compensate any
persons injured or property damaged as a result of coal mining and reclamation operations, including the use of
explosives. The minimum insurance coverage for bodily injury and property damage shall be three hundred thousand
dollars for each occurrence and five hundred thousand dollars in the aggregate; and 
     (3)  Include a rider requiring that the insurer notify the chief whenever substantive changes are made in the
policy, including any termination or failure to renew. 

HISTORY: Eff 10-27-82; 8-19-89
Rule promulgated under: RC Chapter 119.
Rule amplifies: RC 1513.07 
119.032 Review Date: 11-1-99


OAC 1501:13-7-08    BOND RELEASE CONFERENCE.           {{ 30 CFR 800.40 }}
(A)  Procedure for requesting a bond release conference. 
     (1)  The following persons may request a bond release conference: 
          (a)  A person with a valid legal interest which may be adversely affected by release of a bond,
pursuant to rule 1501:13-7-05 of the Administrative Code; or 
          (b)  The responsible officer or head of any federal, state or local government agency that: 
               (i)  Has jurisdiction by law or special expertise with respect to any environmental, social,
or economic impact involved in the operation; or 
               (ii)  Is authorized to develop and enforce environmental standards with respect to the
operation. 
     (2)  Those persons requesting a bond release conference may file written objections to the proposed bond
release, and request a bond release conference with the chief within thirty days after the last publication of the notice
required by paragraph (A)(3) of rule 1501:13-7-05 of the Administrative Code. 
     (3)  If written objections are filed and a bond release conference is requested, the chief shall inform all
interested parties of the time and place of the conference and shall hold the conference within thirty days after receipt
of the request for the conference. 
     (4)  The date, time, and location of the bond release conference shall be advertised by the chief in a
newspaper of general circulation in the locality of the coal mining operation proposed for bond release for at least
once a week for two consecutive weeks. 
     (5)  The bond release conference shall be held in the locality of the coal mining operation proposed for
bond release or in Franklin county at the option of the person requesting the conference. 
     (6)  An electronic or stenographic record shall be made of the conference proceeding, unless waived by all
parties. Such record shall be maintained and shall be accessible to all parties until at least five years after expiration
of the period during which the permit is covered by any portion of a reclamation bond. 
     (7)  In the event that all parties requesting the bond release conference stipulate agreement prior to the
requested conference and withdraw their request, the conference need not be held. 

(B)  Procedure at bond release conference. 
     (1)  A party to a bond release conference may appear in person, by his attorney, or such other representative
as is permitted to practice before the division, and may present his objections to the proposed bond release either
orally or in writing. 
     (2) The conference shall be conducted by the chief or a representative of the chief. 

(C)  Decision of the chief regarding bond release. 
     (1) The chief shall issue his decision to approve or disapprove a bond release in accordance with paragraph
(A)(7) of rule 1501:13-7-05 of the Administrative Code. 
     (2)  Within thirty days after notification of the final decision of the chief regarding the bond release, the
permittee or any person with an interest that is or may be adversely affected may appeal the decision to the
reclamation board of review pursuant to Chapter 1513. of the Revised Code. 

HISTORY: Eff 10-1-88
Rule promulgated under: RC Chapter 119.
Rule amplifies: RC 1513.16 
119.032 Review Date: 11-1-99