VIRGINIA ADMINISTRATIVE CODE TITLE 4. CONSERVATION AND NATURAL RESOURCES AGENCY NO. 25. DEPARTMENT OF MINES, MINERALS AND ENERGY CHAPTER 130 . COAL SURFACE MINING RECLAMATION REGULATIONS (Current as of October 31, 2000) Subchapter VJ. Bond and Insurance Requirements for Surface Coal Mining and Reclamation Operations Part 800 Requirements for Bonding of Surface Coal Mining and Reclamation Operations Sec. 4 VAC 25-130-800.11. Requirement to file a bond. 4 VAC 25-130-800.12. Form of the performance bond. 4 VAC 25-130-800.13. Period of liability. 4 VAC 25-130-800.14. Determination of bond amount. 4 VAC 25-130-800.15. Adjustment of amount. 4 VAC 25-130-800.16. General terms and conditions of bond. 4 VAC 25-130-800.17. Bonding requirements for underground coal mines and long-term coal- related surface facilities and structures. 4 VAC 25-130-800.20. Surety bonds. 4 VAC 25-130-800.21. Collateral bonds. 4 VAC 25-130-800.23. Escrow bonding. 4 VAC 25-130-800.24. Combined surety/escrow bonding. 4 VAC 25-130-800.30. Replacement of bonds. 4 VAC 25-130-800.40. Requirements to release performance bonds. 4 VAC 25-130-800.50. Forfeiture of bonds. 4 VAC 25-130-800.51. Administrative review of performance bond forfeiture. 4 VAC 25-130-800.52. Bond forfeiture reinstatement procedures. 4 VAC 25-130-800.60. Terms and conditions for liability insurance. 4 VAC 25-130-800.11. Requirement to file a bond. {{ 30 CFR 800.11 }} (a) After a permit application under Subchapter VG has been approved, but before the permit is issued, the applicant shall file with the division, on a form prescribed and furnished by the division, a bond or bonds for performance made payable to the division and conditioned upon the faithful performance of all the requirements of the Act, the permit, and the reclamation plan, in accordance with Parts 800 or 801. (b)(1) The bond or bonds shall cover the entire permit area, or for operations bonded under Part 801, an identified increment of land within the permit area upon which the permittee will initiate and conduct surface coal mining and reclamation operations during the initial term of the permit. (2) For operations bonded under Part 801- (A) As surface coal mining and reclamation operations on succeeding increments are initiated and conducted within the permit area, the permittee shall file with the division an additional bond or bonds to cover such increments in accordance with this section. (B) The permittee shall identify the initial and successive areas or increments for bonding on the permit application map submitted for approval as provided in the application (under Parts 780 and 784), and shall specify the bond amount to be provided for each area or increment. ( C) Independent increments shall be of sufficient size and configuration to provide for efficient reclamation operations should reclamation by the division become necessary pursuant to 4 VAC 25-130-800.50. ( c) A permittee shall not disturb any surface areas, succeeding increments, or extend any underground shafts, tunnels or operations prior to acceptance by the division of the required performance bond. (d) The applicant shall file, for approval by the division, a bond or bonds under one of the following schemes for the permit area as determined in accordance with 4 VAC 25-130-800.14 or Part 801: (1) The entire performance bond required by 4 VAC 25-130-801.13; (2) A performance bond or bonds for the entire permit area; (3) A cumulative bond schedule and the performance bond required for full reclamation of the initial area to be disturbed; or (4) For operations bonded under Part 801, an incremental bond schedule and the performance bond required for the first increment in the schedule. ATTORNEY GENERAL OPINIONS The statute authorizing these regulations does not confer on the agency the power to require annual certification by an independent certified public accountant that an operator which has given a reclamation bond without surety is able to meet its obligations under the proposed reclamation plan; the statute merely permits the acceptance of such a bond if the operator meets the net-worth standard set out in the statute, and the statute does not permit consideration of the assets of the parent where the operator is a subsidiary corporation. 1984-1985 Va.Rep.Atty.Gen.179. 4 VAC 25-130-800.12. Form of the performance bond. {{ 30 CFR 800.12 }} The division shall prescribe the form of the performance bond and may allow: (a) A surety bond; (b) A collateral bond; ( c) An escrow account; or (d) A combined surety/escrow account; (e) A combination of any of the bonding methods listed in (a) through (d); or (f) A self bond in accordance with 4 VAC 25-130-801.13. 4 VAC 25-130-800.13. Period of liability. {{ 30 CFR 800.13 }} (a) Performance bond liability shall be for the duration of the surface coal mining and reclamation operation and for a period which is coincident with the permittee's period of extended responsibility for successful revegetation provided in 4 VAC 25-130-816.116 or 4 VAC 25-130-817.116 or until achievement of the reclamation requirements of the Act, and the permit, whichever is later. (b) Isolated and clearly defined portions of the permit area requiring extended liability may be separated from the original area and bonded separately with the approval of the division. Such areas shall be limited in extent and shall not constitute a scattered, intermittent, or checkerboard pattern of failure. Access to the separated areas for remedial work may be included in the area under extended liability if deemed necessary by the division. ( c) If the division approves a long-term, intensive agricultural postmining land use, in accordance with 4 VAC 25-130-816.133 or 4 VAC 25-130-817.133, the 5 year period of liability shall commence at the date of initial planting for such long-term agricultural use. (d)(1) The bond liability of the permittee shall include only those actions which he is obligated to take under the permit, including completion of the reclamation plan, so that the land will be capable of supporting the postmining land use approved under 4 VAC 25-130-816.133 or 4 VAC 25-130-817.133. (2) Implementation of an alternative postmining land use approved under 4 VAC 25-130-816.133 ( c) or 4 VAC 25-130-817.133( c) which is beyond the control of the permittee, need not be covered by the bond. Bond liability for prime farmland shall be as specified in 4 VAC 25-130-800.40( c)(2). 4 VAC 25-130-800.14. Determination of bond amount. {{ 30 CFR 800.14 }} (a) The amount of the bond required for each bonded area shall: (1) Be determined by the division; (2) Depend upon the requirements of the approved permit and reclamation plan; (3) Reflect the probable difficulty of reclamation, giving consideration to such factors as topography, geology, hydrology, and revegetation potential; and (4) Be based on, but not limited to, the estimated cost of reclamation submitted by the permit applicant. (b) The amount of the bond shall be sufficient to assure the completion of the reclamation plan if the work has to be performed by the division in the event of forfeiture, and in no case shall the total bond initially posted for the entire area under one permit be less than $10,000. ( c) A permittee's financial responsibility under 4 VAC 25-130-817.121( c) for repairing material damage resulting from subsidence may be satisfied by the liability insurance policy required under 4 VAC 25-130- 800.60. 4 VAC 25-130-800.15. Adjustment of amount. {{ 30 CFR 800.15 }} (a) The amount of the bond or deposit required and the terms of the acceptance of the applicant's bond shall be adjusted by the division from time to time as the area requiring bond coverage is increased or decreased or where the cost of future reclamation changes. The division may specify periodic times or set a schedule for reevaluating and adjusting the bond amount to fulfill this requirement. (b) The division shall: (1) Notify the permittee, the surety, and any person with a property interest in collateral who has requested notification under 4 VAC 25-130-800.21( c) of any proposed adjustment to the bond amount; and (2) Provide the permittee an opportunity for an informal conference on the adjustment. ( c) A permittee may request reduction of the amount of the performance bond upon submission of evidence to the division proving that the permittee's method of operation or other circumstances reduces the estimated cost for the division to reclaim the bonded area. Bond adjustments which involve undisturbed land or revision of the cost estimate of reclamation are not considered bond release subject to procedures of 4 VAC 25-130-800.40. (d) In the event that an approved permit is revised in accordance with Subchapter VG, the division shall review the bond for adequacy and, if necessary, shall require adjustment of the bond to conform to the permit as revised. 4 VAC 25-130-800.16. General terms and conditions of bond. {{ 30 CFR 800.16 }} (a) The performance bond shall be in an amount determined by the division as provided in 4 VAC 25-130- 800.14 or Part 801. (b) The performance bond shall be payable to the Commonwealth of Virginia, Director-Division of Mined Land Reclamation. ( c) The performance bond shall be conditioned upon faithful performance of all the requirements of the Act, this chapter, and the approved permit, including completion of the reclamation plan. (d) The duration of the bond shall be for the time period provided in 4 VAC 25-130-800.13. (e)(1) The bond shall provide a mechanism for a bank or surety company to give prompt notice to the division and the permittee of any action filed alleging the insolvency or bankruptcy of the surety company, the bank, or the permittee, or alleging any violations which would result in suspension or revocation of the surety or bank charter or license to do business. (2) Upon the incapacity of a bank or surety company by reason of bankruptcy, insolvency, or suspension or revocation of a charter or license, the permittee shall be deemed to be without bond coverage and shall promptly notify the division. The division, upon notification received through procedures of Paragraph (e)(1) of this section or from the permittee, shall, in writing, notify the permittee who is without bond coverage and specify a reasonable period, not to exceed 90 days, to replace bond coverage. If an adequate bond is not posted by the end of the period allowed, the permittee shall cease coal extraction and shall comply with the provisions of 4 VAC 25-130-816.132 or 4 VAC 25-130-817.132 and shall immediately begin to conduct reclamation operations in accordance with the reclamation plan. Mining operations shall not resume until the division has determined that an acceptable bond has been posted. 4 VAC 25-130-800.17. Bonding requirements for underground coal mines and long-term coal- related surface facilities and structures. {{ 30 CFR 800.17 }} (a) Responsibilities. The division shall require bond coverage, in an amount determined under 4 VAC 25- 130-800.14 or Part 801, for long-term surface facilities and structures, and for areas disturbed by surface impacts incident to underground mines, for which a permit is required. Specific reclamation techniques required for underground mines and long-term facilities shall be considered in determining the amount of bond to complete the reclamation. Facilities for which bond is furnished in accordance with Part 801 are excluded from this section, except as provided in 4 VAC 25-130-801.12(e). (b) Long-term period of liability. (1) The period of liability for every bond covering long-term surface disturbances shall commence with the issuance of the permit, except that to the extent that such disturbances will occur on a succeeding increment to be bonded, such liability will commence upon the posting of the bond for that increment before the initial surface disturbance of that increment. The liability period shall extend until all reclamation, restoration, and abatement work under the permit has been completed and the bond is released under the provisions of 4 VAC 25-130-800.40, or until the bond has been replaced or extended in accordance with 4 VAC 25-130-800.17(b)(3). (2) Long-term surface disturbances shall include long-term coal-related surface facilities and structures, and surface impacts incident to underground coal mining, which disturb an area for a period that exceeds five years. Long-term surface disturbances include, but are not limited to: surface features of shafts and slope facilities, coal refuse areas, powerlines, bore-holes, ventilation shafts, preparation plants, machine shops, roads, and loading and treatment facilities. (3) To achieve continuous bond coverage for long-term surface disturbances, the bond shall be conditioned upon extension, replacement, or payment in full, 30 days prior to the expiration of the bond term. (4) Continuous bond coverage shall apply throughout the period of extended responsibility for successful revegetation and until the provisions of 4 VAC 25-130-800.40 have been met. ( c) Bond forfeiture. The division shall take action to forfeit a bond pursuant to this section, if 30 days prior to bond expiration, the permittee has not filed: (1) a performance bond for a new term as required for continuous coverage, or (2) a performance bond providing coverage for the period of liability, including the period of extended responsibility for successful revegetation. 4 VAC 25-130-800.20. Surety bonds. {{ 30 CFR 800.20 }} (a) A surety bond shall be executed by the permittee and a corporate surety licensed to do business in the Commonwealth. (b) Surety bonds shall be noncancellable during their terms, except that surety bond coverage for lands not disturbed may be cancelled with the prior consent of the division. The division shall advise the surety, within 30 days after receipt of a notice to cancel bond, whether the bond may be cancelled on an undisturbed area. 4 VAC 25-130-800.21. Collateral bonds. {{ 30 CFR 800.23 }} (a) Collateral bonds shall be subject to the following conditions: The division shall-- (1) Keep custody of collateral deposited by the applicant until authorized for release or replacement as provided in this Subchapter. (2) Value collateral at its current market value, not at face value. (3) Require that certificates of deposit be made payable to or assigned to the Commonwealth of Virginia, Director-Division of Mined Land Reclamation, both in writing and upon the records of the bank issuing the certificates. The division shall require the banks issuing these certificates to waive all rights of setoff or liens against those certificates and that such certificates be automatically renewable. (4) Not accept an individual certificate of deposit in an amount in excess of $100,000 or the maximum insurable amount as determined by the Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation. (5) Require the applicant to deposit the certificates of deposit in a sufficient amount to assure that the division will be able to liquidate the certificates prior to maturity, upon forfeiture, for the amount of the bond required by this Subchapter. (6) Require the applicant to designate, with the bond submitted, the person to whom-- (i) The collateral will be endorsed and returned upon release or replacement as provided in this Subchapter; and (ii) Any interest or dividends paid on the collateral shall be paid. (b) Cash accounts shall be subject to the following conditions: (1) The division may authorize the permittee to supplement the bond through the establishment of a cash account in one or more federally- insured or equivalently protected accounts made payable upon demand to the division. The total bond including the cash account shall not be less than the amount required under terms of performance bonds including any adjustments, less amounts released in accordance with 4 VAC 25-130-800.40 or 4 VAC 25-130-801.18. (2) Any interest paid on a cash account shall be paid to the permittee. (3) Certificates of deposit may be substituted for a cash account with the approval of the division. (4) The division shall not accept an individual cash account in an amount in excess of $100,000 or the maximum insurable amount as determined by the Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation. ( c) 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 division at the time collateral is offered. 4 VAC 25-130-800.23. Escrow bonding. (a) The division may authorize the permittee to supplement a bonding program through the establishment of an escrow account deposited in one or more federally insured accounts payable on demand only to the division or deposited with the division directly. Contributions to the account may be based on acres affected or tons of coal produced or any other rate approved by the division. In all cases, the total bond including any escrow amount, as determined by the division in the bonding schedule, shall not be less than the amount required under 4 VAC 25-130-800.14 or Part 801, including any adjustments, less amounts released under 4 VAC 25-130-800.40 or Part 801. (b) Escrow funds deposited in federally insured accounts shall not exceed the maximum insured amount under applicable Federal insurance programs such as by FDIC or FSLIC. ( c) Interest paid on escrow accounts shall be retained in the escrow account and applied to the bond value of the escrow account unless the division has approved that the interest be paid to the permittee. In order to qualify for interest payment, the permittee shall request such action in writing during the permit application process under 4 VAC 25-130-800.11. (d) Certificates of deposit may be substituted for escrow accounts upon approval of the division. Provisions of 4 VAC 25-130-800.21 shall apply to certificates of deposit as collateral bond. 4 VAC 25-130-800.24. Combined surety/escrow bonding. (a) The division may accept a combined surety/escrow bonding schedule provided that: (1) A surety bond payable to the division is posted in the amount determined under 4 VAC 25-130- 800.14 or 4 VAC 25-130-801.12 for reclamation of each successive increment, and (2) An interest-bearing escrow account payable to the division with a predetermined deposit amount and frequency is established. (b) Conditions of the combined surety/escrow bonding method shall be as follows: (1) Surety bond. (i) The term of the surety bond shall be not less than two years. (ii) The amount of the surety bond shall always be sufficient to cover the difference between the escrow balance and the total reclamation cost. (iii) The surety bond may be reduced in amount, but the liability remaining shall depend on the escrow-deposit rate which shall be subject to provisions of 4 VAC 25-130-800.15 and 4 VAC 25-130- 800.30. (iv) The surety bond shall be noncancellable by the surety during the bond term. (v) Surety bond coverage may be released by the division without applying the bond- release criteria of 4 VAC 25-130-800.40 at any time during the bond term, provided provisions of Paragraph (b)(2)(vi) of this section are met or are in accordance with the provisions of bond replacement under 4 VAC 25-130-800.30. (vi) The surety bond is subject to the conditions of bond forfeiture of 4 VAC 25-130- 800.50, including noncompliance with the escrow account provisions of Paragraph (b)(2) of this section. (2) Escrow account. (i) The terms and conditions of the escrow account shall be developed jointly by the permittee, surety, and the division. For the purposes of this section, the development of the escrow account shall be based on a production basis in an amount not less than that required to make the escrow account equal to or greater than the bond requirement within the term of the surety bond as agreed on jointly by the permittee, the surety, and the division. Deposits to the escrow account by the permittee shall be made monthly and so reported to the division. Failure to make deposits on schedule shall be just cause for action by the division. (ii) A certified escrow account balance statement shall be provided quarterly to the surety and the division. (iii) Provisions of the escrow account shall be in accordance with 4 VAC 25-130-800.23. (iv) The deposit amount shall be adjusted to provide for changing reclamation costs in accordance with 4 VAC 25-130-800.15. However, when the escrow account equals or exceeds the total bonding amount, the monthly payment of the permittee shall continue, at the option of the division, in an amount necessary to provide for any foreseeable adjustments. (v) The escrow account shall be subject to the bond forfeiture conditions of 4 VAC 25- 130- 800.50. (vi) The escrow account balance shall equal the initial bond amount, plus any adjustments required by Paragraph (b)(2)(i), 120 days prior to surety bond termination, unless the total amount required has been previously reduced through the bond release procedures of 4 VAC 25-130-800.40. (vii) Release of liability under the escrow account shall be subject to the provisions of 4 VAC 25-130-800.40. ( c) Provisions of 4 VAC 25-130-800.40 may be applied to both surety and escrow bond coverage during the bond term. (d) The surety/escrow combination may be repeated successively or amended during the term by replacing the escrow account with a surety bond, and reestablishing the escrow terms and deposit rate, subject to division approval. 4 VAC 25-130-800.30. Replacement of bonds. {{ 30 CFR 800.21 }} (a) The division may allow a permittee to replace existing bonds with other bonds that provide equivalent coverage. (b) The division shall not release existing performance bonds until the permittee has submitted, and the division has approved, acceptable replacement performance bonds. Replacement of a performance bond pursuant to this section shall not constitute a release of bond under 4 VAC 25-130-800.40. 4 VAC 25-130-800.40. Requirements to release performance bonds. {{ 30 CFR 800.40 }} (a) Bond release application. (1) The permittee may file an application with the division for the release of all or part of a performance bond. Applications may be filed only at times or during seasons authorized by the division in order to properly evaluate the completed reclamation operations. The times or seasons appropriate for the evaluation of certain types of reclamation shall be identified in the mining and reclamation plan required in Subchapter VG. (2) Within 30 days after an application for bond release has been filed with the division, the permittee shall submit proof of publication of the advertisement placed at least once a week for four successive weeks in a newspaper of general circulation in the locality of the surface coal mining operation. The advertisement shall be considered part of any bond release application and shall contain the applicant's name, the permit number, notification of the precise location of the land affected, the number of acres, the type and amount of the bond filed and the portion sought to be released, the type and appropriate dates of reclamation work performed, a description of the results achieved as they relate to the permittee's approved reclamation plan, and the name and address of the division to which written comments, objections, or requests for public hearings and informal conferences on the specific bond release may be submitted pursuant to 4 VAC 25-130-800.40(f) and (h). In addition, as part of any bond release application, the permittee shall submit copies of letters which he has sent to adjoining property owners, local governmental bodies, planning agencies, sewage and water treatment authorities, and water companies in the locality in which the surface coal mining and reclamation operation took place, notifying them of the intention to seek release from the bond. (3) The permittee shall include in the application for bond release a notarized statement which certifies that all applicable reclamation activities have been accomplished in accordance with the requirements of the Act, the regulatory program, and the approved reclamation plan. Such certification shall be submitted for each application or phase of bond release. (b) Inspection by the division. (1) Upon receipt of the bond release application, the division shall, within 30 days, or as soon thereafter as weather conditions permit, conduct an inspection and evaluation of the reclamation work involved. The evaluation shall consider, among other factors, the degree of difficulty to complete any remaining reclamation, whether pollution of surface and subsurface water is occurring, the probability of future occurrence of such pollution, and the estimated cost of abating such pollution. The surface owner, agent, or lessee shall be given notice of such inspection and may participate with the division in making the bond release inspection. The division may arrange with the permittee to allow access to the permit area, upon request by any person with an interest in the bond release, for the purpose of gathering information relevant to the proceeding. (2) Within 60 days from the filing of the bond release application, if no public hearing is held pursuant to paragraph (f) of this section, or, within 30 days after a public hearing has been held pursuant to paragraph (f) of this section, the division shall notify in writing the permittee, the surety or other persons with an interest in the bond collateral who have requested notification under 4 VAC 25-130-800.21( c), and the persons who either filed objections in writing or objectors who were a party to the hearing proceedings, if any, of its decision to release or not to release all or part of the performance bond. ( c) The division may release all or part of the bond for the entire permit area or a portion of the permit area if the division is satisfied that all reclamation or a phase of the reclamation covered by the bond or portion thereof has been accomplished in accordance with the following schedules for reclamation of Phases I, II and III: (1) At the completion of Phase I, after the permittee completes the backfilling, regrading (which may include the replacement of topsoil) and drainage control of a bonded area in accordance with the approved reclamation plan, 60% of the bond or collateral for the applicable area. (2) At the completion of Phase II, after revegetation has been established on the regraded mined lands in accordance with the approved reclamation plan, an additional amount of bond. When determining the amount of bond to be released after successful revegetation has been established, the division shall retain that amount of bond for the revegetated area which would be sufficient to cover the cost of reestablishing revegetation if completed by a third party and for the period specified for permittee responsibility in  45.1-241 of the Act for reestablishing revegetation. No part of the bond or deposit shall be released under this paragraph so long as the lands to which the release would be applicable are contributing suspended solids to streamflow or runoff outside the permit area in excess of the requirements set by  45.1-242 of the Act and by Subchapter VK or until soil productivity for prime farmlands has returned to the equivalent levels of yield as nonmined land of the same soil type in the surrounding area under equivalent management practices as determined from the soil survey performed pursuant to  45.1-238(D) of the Act and Part 823. Where a silt dam is to be retained as a permanent impoundment pursuant to Subchapter VK, the Phase II portion of the bond may be released under this paragraph so long as provisions for sound future maintenance by the permittee or the landowner have been made with the division. (3) At the completion of Phase III, after the permittee has successfully completed all surface coal mining and reclamation activities, the release of the remaining portion of the bond, but not before the expiration of the period specified for permittee responsibility in 4 VAC 25-130-816.116 or 4 VAC 25-130- 817.116. However, no bond shall be fully released under provisions of this section until reclamation requirements of the Act and the permit are fully met. (d) If the division disapproves the application for release of the bond or portion thereof, the division shall notify the permittee, the surety, and any person with an interest in collateral as provided for in 4 VAC 25- 130-800.21( c), in writing, stating the reasons for disapproval and recommending corrective actions necessary to secure the release and allowing an opportunity for a public hearing. (e) When any application for total or partial bond release is filed with the division, the division shall notify the town, city or other municipality nearest the operation and the county in which the surface coal mining operation is located by certified mail at least 30 days prior to the release of all or a portion of the bond. (f) Any person with a valid legal interest which might be adversely affected by release of the bond, or the responsible officer or head of any federal, state, or local governmental agency which has jurisdiction by law or special expertise with respect to any environmental, social, or economic impact involved in the operation or which is authorized to develop and enforce environmental standards with respect to such operations, shall have the right to file written objections to the proposed release from bond with the division within 30 days after the last publication of the notice required by 4 VAC 25-130-800.40(a)(2). If written objections are filed and a hearing is requested, the division shall inform all the interested parties of the time and place of the hearing, and shall hold a public hearing within 30 days after receipt of the request for the hearing. The date, time and location of the public hearing shall be advertised by the division in a newspaper of general circulation in the locality for two consecutive weeks. The public hearing shall be held in the locality of the surface coal mining operation from which bond release is sought, at the location of the division office, or at the State Capital, at the option of the objector. The decision of the Hearing Officer shall be made within 30 days from the close of the hearing. (g) For the purpose of the hearing under paragraph (f) of this section, the division shall have the authority to administer oaths, subpoena witnesses or written or printed material, compel the attendance of witnesses or the production of materials, and take evidence including, but not limited to, inspection of the land affected and other surface coal mining operations carried on by the applicant in the general vicinity. A verbatim record of each public hearing shall be made, and a transcript shall be made available on the motion of any party or by order of the division. (h) Without prejudice to the right of an objector or the applicant, the division may hold an informal conference as provided in  45.1-239 of the Act to resolve such written objections. The division shall make a record of the informal conference unless waived by all parties, which shall be accessible to all parties. The division shall also furnish all parties of the informal conference with a written finding of the division based on the informal conference, and the reasons for said finding. Effect of Amendment January 6, 1999 amendment added paragraph (a)(3), to conform to 30 CFR 800.40. 4 VAC 25-130-800.50. Forfeiture of bonds. {{ 30 CFR 800.50 }} (a) If the permittee refuses or is unable to conduct reclamation of an unabated violation, fails to comply with the terms of the permit, or defaults on the conditions under which the bond was accepted, the division shall take the following action to forfeit all or part of a bond or bonds for the permit area or a portion of the permit area: (1) Send written notification by certified mail, return receipt requested, to the permittee and the surety on the bond, if any, informing them of the determination to forfeit all or part of the bond, including the reasons for the forfeiture and the amount to be forfeited. The amount shall be based on the estimated total cost of achieving the reclamation plan requirements. (2) Advise the permittee and surety, if applicable, of the conditions under which forfeiture may be avoided. Such conditions may include, but are not limited to-- (i) Agreement by the permittee or another party to perform reclamation operations in accordance with a compliance schedule acceptable to the division, which meets the conditions of the permit, the reclamation plan, and demonstrates that such party has the ability to satisfy the conditions; or (ii) The division may allow a surety to complete the reclamation plan if the surety can demonstrate an ability to complete the reclamation in accordance with the approved reclamation plan. Except where the division may approve partial release authorized under 4 VAC 25-130-800.40, no surety liability shall be released until successful completion of all reclamation under the terms of the permit, including applicable liability periods of 4 VAC 25-130-800.13. (b) In the event forfeiture of the bond is required by this section, the division shall: (1) Proceed to collect the forfeited amount as provided by Virginia law for the collection of defaulted bonds or other debts if actions to avoid forfeiture have not been taken, or if rights of appeal, if any, have not been exercised within a time established by the division, or if such appeal, if taken, is unsuccessful. (2) Use funds collected from bond forfeiture to complete the reclamation plan on the permit area. ( c) Upon default, the division may cause the forfeiture of any and all bonds deposited to complete reclamation for which the bonds were posted. Unless specifically limited, as provided in 4 VAC 25-130- 800.11(b)(3), bond liability shall extend to the entire permit area under conditions of forfeiture. (d)(1) In the event the estimated amount forfeited is insufficient to pay for the full cost of reclamation, the permittee shall be liable for the remaining costs. The division may complete, or authorize completion of, reclamation of the bonded area and may recover from the permittee all costs of reclamation in excess of the amount forfeited. (2) In the event the amount of performance bond forfeited was more than the amount necessary to complete reclamation, the unused funds shall be returned by the division to the party from whom they were collected. CASE NOTES Amount of forfeiture 1 1. Amount of forfeiture Where reclamation plan remained unperformed and permittee was admittedly without funds to complete reclamation, Mined Land Reclamation Division properly forfeited entire amount of reclamation bonds rather than amount needed to correct conditions listed in notices of violation, but Division must account for any proceeds not used in completing reclamation plan. General Trucking Corp. v. Dishner, 1995, 464 S.E.2d 545, 21 Va.App. 409. 4 VAC 25-130-800.51. Administrative review of performance bond forfeiture. (a) The permittee or surety, if applicable, may request, in writing, a hearing on the division's determination to forfeit the performance bond within 30 days of receipt of the written determination from the division. (b) A request for hearing shall not operate as a stay of the bond forfeiture decision. Unless the division decides to withhold forfeiture as provided by 4 VAC 25-130-800.50(a)(2), it shall take immediate steps to collect the necessary performance bond amounts so that it, or its contractor, may complete the reclamation plan and any other regulatory requirements in the most expeditious manner possible, pending administrative and/or judicial review. ( c)(1) The division shall commence the hearing within 30 days of the hearing request. The hearing shall be conducted in accordance with  9-6.14:12 of the Code of Virginia by a Hearings Officer appointed by the Director. (2) The burden of proof at such hearing shall be on the party seeking to reverse the decision of the division. (3) For the purpose of such hearing, the Hearings Officer may administer oaths and affirmations, subpoena witnesses, written or printed materials, compel attendance of witnesses or production of those materials, compel discovery, and take evidence, including but not limited to site inspections of the land affected. (4) The Hearings Officer shall cause an accurate verbatim record of the hearing to be made. The division may charge the reasonable cost of preparing such record to any party who requests a copy of the record. (5) Ex parte contacts between representatives of the parties to the hearing and the Hearings Officer shall be prohibited. (6) Within 30 days after the close of the record, the division shall issue and furnish the permittee, surety (if applicable) and each person who participated in the hearing with the written findings of fact, conclusion of law, and order of the Hearings Officer with respect to the appeal. The decision of the Hearings Officer shall be final as of the date of issuance, subject to the review and reconsideration by the Director or his designee, provided in Subsection (d). (d) Within 14 days after the issuance of the Hearings Officer's decision under Subsection ( c)(6), the permittee, surety (if applicable), or any person who participated in the hearing and has an interest which is or may be adversely affected by the decision, may appeal to the Director or his designee for review of the record and reconsideration of the Hearings Officer's decision. The Director or his designee may also on his own motion, with notice to the parties, review the record and reconsider the Hearings Officer's decision within the same time period. No further evidence will be allowed in connection with such review and reconsideration, but the Director or his designee may hear further arguments and may, after considering the record, remand the case for further hearing if he considers such action necessary to develop the facts. Within 30 days of the appeal or motion for review and reconsideration, the Director or his designee shall complete his review of the Hearings Officer's decision and issue a final decision. (e) All requests for hearing, or appeals for review and reconsideration made under this section; and all notices of appeal for judicial review of a Hearing Officer's final decision, or the final decision on review and reconsideration shall be filed with the Director, Division of Mined Land Reclamation, Drawer 900, Big Stone Gap, Virginia 24219. 4 VAC 25-130-800.52. Bond forfeiture reinstatement procedures. (a) Any person who owns or controls or has owned or controlled any operation on which the bond has been forfeited or the permit revoked pursuant to this chapter or pursuant to Chapters 15 [repealed], 17 ( 45.1-198 et seq.) or 23 [repealed] of Title 45.1 of the Code of Virginia and who has not previously been reinstated by the Board of Conservation and Economic Development or the Director may petition the Director for reinstatement. Reinstatement, if granted, shall be under such terms and conditions as set forth by the Director or his designee. The Director or his designee in determining the terms and conditions shall consider the particular facts and circumstances existing in each individual case. Reinstatement shall not be available to applicants for reinstatement where the division finds that the applicant controls or has controlled surface coal mining and reclamation operations with a demonstrated pattern of willful violations of the Act of such nature and duration and with such resulting irreparable damage to the environment as to indicate an intent not to comply with the Act, in accordance with 4 VAC 25-130-773.15(b)(3). As a minimum, the applicant for reinstatement shall satisfy the following requirements: (1) Abatement of any outstanding violations existing on each site on which the bond has been forfeited or the permit revoked; (2) Payment of any outstanding civil penalties (both State and Federal), Reclamation fund taxes, and any outstanding fees, including Federal Abandoned Mine Land Reclamation taxes; (3) Reclaim each site on which the bond was forfeited according to the applicable law, regulations and standards governing the site at the time of bond forfeiture; (4) Payment to the Director of any money expended by the Commonwealth in excess of the forfeited bond amount to accomplish the reclamation of the sites; and (5) Pay to the Director a civil penalty of $5,000 assessed by the Director on each site forfeited. These civil penalties shall be used by the Director to accomplish reclamation on other forfeited or abandoned surface coal mining operations. (b) Reinstatement by the Director shall be a prerequisite to the filing by the person (applicant for reinstatement) of any new permit application or renewal under this chapter or Chapters 15 [repealed], 17 ( 45.1-198 et seq.), or 23 [repealed] of Title 45.1 of the Code of Virginia, but shall not affect the person's need to comply with all other requirements of said statutes, regulations or both promulgated thereunder. 4 VAC 25-130-800.60. Terms and conditions for liability insurance. {{ 30 CFR 800.56 }} (a) The division shall require the applicant to submit prior to permit issuance a certificate issued by an insurance company licensed to do business in the Commonwealth certifying that the applicant has a public liability insurance policy in force for the surface coal mining and reclamation operations for which the permit is sought. Such policy shall provide for personal injury and property damage protection in an amount adequate to compensate any persons injured or property damaged as a result of the surface coal mining and reclamation operations, including the use of explosives, and who are entitled to compensation under the applicable provisions of Virginia law. Minimum insurance coverage under split limit for bodily injury and property damage shall be $300,000 for each occurrence and $500,000 aggregate. Minimum insurance coverage for bodily injury and property damage combined shall be $1,000,000 for each occurrence and $1,000,000 aggregate. (b) The policy shall be maintained in full force during the life of the permit or any renewal thereof, including the liability period necessary to complete all reclamation operations under this chapter. ( c) The policy shall include a rider requiring that the insurer notify the division whenever substantive changes are made in the policy including any termination or failure to renew. VIRGINIA ADMINISTRATIVE CODE TITLE 4. CONSERVATION AND NATURAL RESOURCES AGENCY NO. 25. DEPARTMENT OF MINES, MINERALS AND ENERGY CHAPTER 130 . COAL SURFACE MINING RECLAMATION REGULATIONS (Current as of October 31, 2000) Subchapter VJ. Bond and Insurance Requirements for Surface Coal Mining and Reclamation Operations Part 801 Coal Surface Mining Reclamation Fund, Penalties, and Self-Bonding Sec. 4 VAC 25-130-801.2. Scope. 4 VAC 25-130-801.4. Objective. 4 VAC 25-130-801.11. Participation in the pool bond fund. 4 VAC 25-130-801.12. Entrance fee and bond. 4 VAC 25-130-801.13. Self-bonding. 4 VAC 25-130-801.14. Reclamation tax. 4 VAC 25-130-801.15. Collection of the reclamation tax and penalties for non-payment. 4 VAC 25-130-801.16. Reinstatement to the pool bond fund. 4 VAC 25-130-801.17. Bond release application. 4 VAC 25-130-801.18. Criteria for release of bond. 4 VAC 25-130-801.19. Forfeiture. 4 VAC 25-130-801.2. Scope. The regulations of this Part establish the procedures and requirements for an alternative bonding system through which the division will implement and administer the Coal Surface Mining Reclamation Fund (Pool Bond Fund) as established under Article 5 ( 45.1-270.1 et seq.) of Chapter 19 of Title 45.1 of the Code of Virginia. 4 VAC 25-130-801.4. Objective. The objective of this Part is to set forth the requirements and procedures that a participating applicant must comply with in order to be relieved of the bonding requirements of 4 VAC 25-130-800.14 and 4 VAC 25- 130-800.17. 4 VAC 25-130-801.11. Participation in the pool bond fund. {{ No Direct Federal Counterpart; 30 CFR 800.11 [Related] }} (a) Participation in the Pool Bond Fund shall be at the option of any applicant for a permit under the Act and the regulations promulgated thereunder who can demonstrate to the division's satisfaction at least a consecutive three-year history of compliance under the Act or any other comparable State or Federal Act. (b) All participants in the Pool Bond Fund shall (1) Pay all entrance fees to the Pool Bond Fund as required by 4 VAC 25-130-801.12(a); and (2) Comply with the applicable parts of section 45.1-241 of the Code of Virginia. ( c) Commencement of participation in the Pool Bond Fund shall constitute an irrevocable commitment by the permittee to participate therein as to the applicable permit and for the duration of the coal surface mining operations covered thereunder. (d) All fees and taxes are nonrefundable. (e) The division shall, as provided by section 45.1-270.5(B) of the Code of Virginia, utilize those monies from the interest accrued to the fund which are required to properly administer the Pool Bond Fund. These monies shall be used to support one position for administration of the Pool Bond Fund; however, if it is apparent that such position is insufficient to ensure proper administration of the Pool Bond Fund, the division may upon proof of need, and upon concurrence with the Pool Bond Fund Advisory Board obtain additional assistance. 4 VAC 25-130-801.12. Entrance fee and bond. {{ 30 CFR 800.11 }} (a) An applicant filing a permit application for coal surface mining operations and electing to participate in the Pool Bond Fund shall prior to permit issuance pay into the Pool Bond Fund an entrance fee for the applicable permit application. An entrance fee of $5,000 shall be required of all applicants who elect to participate in the Fund when the total balance of the Fund is determined to be less than $1,750,000. The entrance fee shall be reduced to $1,000 when the total Fund balance is greater than $2 million. A renewal fee of $1,000 shall be required of all permittees in the Fund at permit renewal. The fee shall be made payable to the Treasurer of Virginia and shall be in the form of cash, cashier's check, certified check, or personal check. (b) An applicant electing to participate in the Pool Bond Fund shall, in accordance with section 45.1-241 of the Code of Virginia, furnish a bond as provided by 4 VAC 25-130-800.12, 4 VAC 25-130-800.14 and 4 VAC 25-130-800.16: (1) For those underground mining operations participating in the Fund prior to July 1, 1991, in the amount of $1,000 per acre covered by the permit. In no event shall the total bond be less than $40,000, except that on permits which have completed all mining and for which completion reports have been approved prior to July 1, 1991, the total bond shall not be less than $10,000. (2) For underground mining operations entering the Fund on or after July 1, 1991, and for additional acreage bonded on or after July 1, 1991, the amount of $3,000 per acre. In no event shall the total bond for such underground operations entering the Fund on or after July 1, 1991, be less than $40,000. (3) For all other coal surface mining operations participating in the Fund prior to July 1, 1991, the amount of $1,500 per acre covered by each permit. In no event shall such total bond be less than $100,000, except that on permits which have completed all mining and for which completion reports have been approved prior to July 1, 1991, the total bond shall not be less than $25,000. (4) For other coal mining operations entering the Fund on or after July 1, 1991, and for additional acreage bonded on or after July 1, 1991, the amount of $3,000 per acre. In no event shall the total bond for such operations entering the Fund on or after July 1, 1991, be less than $100,000. ( c) The Director may accept the bond of an applicant of an underground mining operation without separate surety, as provided by 4 VAC 25-130-801.13, upon a showing by such applicant of a net worth, total assets minus total liabilities (certified by an independent certified public accountant), equivalent to $1 million. Such net worth shall be, during the existence of the permit, certified annually by an independent certified public accountant and the certification submitted on the anniversary date of the permit. (d) The Director may accept the bond of an applicant of a surface mining operation or associated facility without separate surety, upon a showing by the applicant of those conditions set forth in 4 VAC 25-130- 801.13(b). (e) The bond liability shall extend to cover subsidence and mine drainage in accordance with 4 VAC 25- 130- 800.14( c). (f) The amount of the performance bond liability applicable to a permit shall be adjusted by the division as the acreage in the permit area is revised. The bond adjustments are not subject to the bond release procedures of 4 VAC 25-130-801.17. (g) Any mining operation participating in the Fund that has been in temporary cessation for more than six months as of July 1, 1991, shall, within ninety days of that date, post bond equal to the total estimated cost of reclamation for all portions of the permitted site which are in temporary cessation. Any mining operation participating in the Fund that has been in temporary cessation six months or less as of July 1, 1991, shall, within 90 days after the date on which the operation has been in temporary cessation for more than six months, post bond equal to the total estimated cost of reclamation for all portions of the permitted site which are in temporary cessation. Any mining operation participating in the Fund that enters temporary cessation on or after July 1, 1991, shall, prior to the date on which the operation has been in temporary cessation for more than six months, post bond equal to the total estimated cost of reclamation for all portions of the permitted site which are in temporary cessation. The amount of bond required for each area bonded under this Subsection shall be determined by the division in accordance with 4 VAC 25-130- 800.14. Such bond shall remain in effect throughout the remainder of the period during which the site is in temporary cessation. At such time as the site returns to active status, the bond posted under this Subsection may be released, provided the permittee has posted bond pursuant to Subsection (b) of this section. 4 VAC 25-130-801.13. Self-bonding. (a) The division may accept a self-bond from the applicant of a proposed underground mining operation. (1) The applicant shall designate the: (i) Name and address of a suitable agent to receive service of process in the Commonwealth. (ii) Name and address of the certified public accountant(s) who prepared the statement required by this section. (iii) Location of the financial records used to prepare the C.P.A. statement required by this section. (2) The applicant has a net worth, certified by an independent Certified Public Accountant in the form of an unqualified opinion appended to the financial statement submitted, of no less than $1 million after total liabilities are subtracted from total assets. If the applicant is a subsidiary corporation, the applicant's parent organization's net worth need only be certified by the independent Certified Public Accountant, if the applicant uses or includes any assets or liabilities of the parent organization in computing or arriving at the applicant's net worth. Where the division has a valid reason to believe that the permittee's net worth is less than required by this Subsection, it may require a new Certified Public Accountant's statement and certification. (3)(i) A cognovit note must be executed by the applicant, and said agreement must also be executed by: (A) If a corporation, two corporate officers who are authorized to sign the note by a resolution of the board of directors, a copy of which shall be provided; (B) To the extent that the history or assets of a parent organization are relied upon to make the showings of this Part, the parent organization of which it is a subsidiary, whether first- tier, second-tier, or further removed, in the form of (A) above; ( C) If the applicant is a partnership, all of its general partners and their parent organization or principal investors; and (D) If the applicant is a married individual, the applicant's spouse; (ii) Any person who occupies more than one of the specified positions shall indicate each capacity in which he signs the note; (iii) The cognovit note shall be a binding obligation, jointly and severally, on all who execute it; (iv) For the purposes of this Paragraph, principal investor or parent organization means anyone with a 10 percent or more beneficial ownership interest, directly or indirectly, in the applicant. (b) The division may accept a self-bond from the applicant of a proposed surface mining operation or associated facility. The applicant shall provide the: (1) Name and address of a suitable agent to receive service of process in the Commonwealth. (2) Evidence indicating a history of satisfactory continuous operation. (3) Evidence substantiating the applicant's financial solvency, with the appropriate financial documentation required by Paragraph (a)(2) of this section. (4) Indemnity agreement: (i) Containing the date of execution; (ii) Made payable to the "Treasurer of Virginia"; (iii) Immediately due and payable in the event of bond forfeiture of the permit; (iv) Payable in a sum certain of money; (v) Signed by the maker(s); (vi) The indemnity agreement must be executed by the applicant and by: (A) If a corporation, two corporate officers who are authorized to sign the agreement by a resolution of the Board of Directors, a copy of which shall be provided; (B) To the extent that the history or assets of a parent organization are relied upon to make the showings of this Part, the parent organization of which it is a subsidiary, whether first- tier, second-tier, or further removed, in the form of (A) above; ( C) If the applicant is a partnership, all of its general partners and their parent organization or principal investors; and (D) If the applicant is a married individual, the applicant's spouse; (vii) Any person who occupies more than one of the specified positions shall indicate each capacity in which he signs the indemnity agreement; (viii) The indemnity agreement shall be a binding obligation, jointly and severally, on all who execute it; (ix) For purposes of this Paragraph, principal investor or parent organization means anyone with a 10 percent or more beneficial ownership interest, directly or indirectly, in the applicant. ( c) Whenever a participant in the Pool Bond Fund applies for an additional permit or permits, the C.P.A. certification required by Paragraph (a)(2) or (b)(3) of this section shall be updated reflecting those prior reclamation obligations and self- bonding liabilities still in effect. (d) If at any time the conditions upon which the self-bond was approved no longer prevail, the division shall require the posting of a surety or collateral bond before coal surface mining operations may continue. The permittee shall immediately notify the division of any change in his total liabilities or total assets which would jeopardize the support of the self-bond. If the permittee fails to have sufficient resources to support the self-bond, he shall be deemed to be without bond coverage in violation of 4 VAC 25-130-800.11(b). 4 VAC 25-130-801.14. Reclamation tax. {{ 30 CFR 800.11 }} (a) If at the end of any calendar quarter the total balance of the Pool Bond Fund, including interest thereon, is less than $1,750,000, the tax shall be initiated. All permittees participating in the Pool Bond Fund shall pay within 30 days after the end of each taxable calendar quarter, an amount equal to: (1) Four cents per clean ton of coal produced by the surface mining operation of the permit during the taxable calendar quarter. (2) Three cents per clean ton of coal produced by the underground mining operation of the permit during the taxable calendar quarter. (3) One and one-half cents per clean ton of coal processed or loaded by the preparation or loading facility operation of the permit during the taxable calendar quarter. (b) If at the end of any calendar quarter the total balance of the Pool Bond Fund, including interest thereon, exceeds $2 million, payments shall be deferred until required by 4 VAC 25-130-801.14(a). ( c) No permittee shall pay the reclamation tax on more than five million tons of coal produced per calendar year, regardless of the number of permits held by that permittee, except as provided in Subsection (e) of this section. (d) In no event except as provided in Subsection (e) of this section, shall the division require any permittee participating in the Pool Bond Fund: (1) Holding more than one type of permit to pay a reclamation tax at a rate in excess of five and one-half cents per ton on coal originally surface mined by that permittee or in excess of four and one-half cents per ton on coal originally deep mined by that permittee; or (2) Holding one permit upon which coal is both mined and processed or loaded to pay more than the tax applicable to the surface mining operation or underground mining operation. However, the permittee shall pay the one and one-half cents per clean ton for all coal processed and/or loaded at the permit which originated from other permits during the calendar quarter. (e) Upon permit issuance for which bond is provided pursuant to this Part, the permittee shall pay the applicable reclamation tax required by Subsection (a) into the Pool Bond Fund on coal mined and removed under the permit during the one year period commencing with and running from the date of the commencement of coal production, processing or loading from that permit. 4 VAC 25-130-801.15. Collection of the reclamation tax and penalties for non-payment. {{ No Direct Federal Counterpart }} (a) The division shall notify, in writing, each permittee participating in the Pool Bond Fund, at the end of each calendar quarter, of those periods during which the reclamation taxes are applicable or deferred. The permittee shall on a quarterly basis file a notarized copy of the "Coal Surface Mining Reclamation Fund Tax Reporting Form" with the division: Attention Director. The permittee shall file the report by permit and applicable tonnage mined, processed, and/or loaded no later than the 15th day of the month after the end of each calendar quarter, even if no coal was mined, processed and/or loaded on the permit(s). (b) Each permittee participating in the Fund shall submit to the division's Big Stone Gap Office full payment of the appropriate reclamation taxes required under 4 VAC 25-130-801.14(a) or (e) within 30 days after the end of the calendar quarter, when the taxes are applicable. Payment of the reclamation taxes shall be in cash, cashier's check, certified check or personal check made payable to the Treasurer of Virginia. ( c) Where the division has reason to suspect inaccurate reporting of the production of clean tons of coal, it may request to audit the relevant books and records of the permittee upon which the taxes paid under this Part are based. The request shall be in writing and sent to the permittee or his authorized representative by certified mail, return receipt requested. Failure to consent to the request for the audit shall be deemed a violation of this Part and subject to the enforcement procedures of Part 843. The audit shall be conducted at reasonable times during normal business hours and the permittee shall be given adequate advance notice of when the audit is to be conducted. (d) If the permittee fails to make full payment of the reclamation taxes due under 4 VAC 25-130-801.14, the division shall issue a notice of violation in accordance with 4 VAC 25-130-843.12. The notice shall state that upon failure to make full payment within 15 calendar days thereafter, the division shall issue a cessation order to the permittee for failure to abate the notice of violation. If the cessation order is issued, the enforcement procedures of Part 843 shall apply. (e) The division shall assess a civil penalty in accordance with Part 845, for the permittee's violation of the conditions set forth in this Part. Civil penalties imposed upon the permittee for violation of this section, shall be placed in the Pool Bond Fund. 4 VAC 25-130-801.16. Reinstatement to the pool bond fund. (a) A permittee who has defaulted on any reclamation obligation and has thereby caused the Pool Bond Fund to incur reclamation expenses as a result thereof, shall not be eligible to participate in the Pool Bond Fund for any new permit or any permit renewal thereafter until full restitution for such default has been made to the Pool Bond Fund. The Director at his discretion and with the recommendation from the Coal Surface Mining Reclamation Pool Bond Fund Advisory Committee may require that the person seeking reinstatement pay interest at the composite rate determined by the Treasurer of Virginia compounded monthly. (b) Compliance with Subsection (a) shall be a prerequisite to the filing by the permittee of any new permit application or renewal under the Act, but shall not affect the permittee's need to comply with all other requirements of the Act and the regulations promulgated thereunder in applying for a permit. 4 VAC 25-130-801.17. Bond release application. {{ 30 CFR 800.40 }} (a) The permittee participating in the Pool Bond Fund, or any person authorized to act upon his behalf, may file an application with the division for release of all or part of the bond furnished in accordance with 4 VAC 25-130-801.12(b) for the increment areas which have been adequately reclaimed and vegetation established pursuant to the postmining land use. A minimum of one (1) full growing season or a minimum of twelve (12) months, whichever is longer, must have elapsed before the division will determine that the vegetation is adequately established. However, in no event shall the total bond of the permit be less than the minimum amounts established pursuant to 4 VAC 25-130-801.12(b) prior to completion of the two full growing seasons and compliance with 4 VAC 25-130-801.18. Bond liability shall continue for not less than five years, or as provided by 4 VAC 25-130-800.13 or 4 VAC 25-130-800.17(b). (1) Applications may only be filed at times or seasons that allow the division to evaluate properly the reclamation operations alleged to have been completed. The times or seasons appropriate for the evaluation of certain types of reclamation shall be identified in the mining and reclamation operations plan required in Subchapter VG and approved by the division. (2) The application shall include copies of letters sent to adjoining property owners, surface owners, local government bodies, planning agencies, and sewage and water treatment facilities or water companies in the locality of the permit area, notifying them of the permittee's intention to seek release of performance bond(s). These letters shall be sent before the permittee files the application for release. (3) Within 30 days after filing the application for release the permittee shall submit proof of publication of the advertisement required by Paragraph (b) of this section. Such proof of publication shall be considered part of the bond release application. (b) The permittee seeking total or partial bond release shall, at the time of filing an application under this section, advertise the filing of the application as provided by 4 VAC 25-130-800.40(a)(2). ( c) The division shall inspect and evaluate the reclamation work involved within 30 days after receiving a completed application for bond release, or as soon thereafter as weather conditions permit. The surface owner, or agent, or lessee shall be given notice of such inspection and may participate with the division in making the bond release inspection. (d) Division review and decision. (1) The division shall consider, during the inspection evaluation, hearing and decision: (i) Whether the permittee has met the criteria for release of the bond under 4 VAC 25-130- 801.18; (ii) The degree of difficulty in completing any remaining reclamation, restoration, or abatement work; and (iii) Whether pollution of surface and subsurface water is occurring, the probability of future pollution or the continuance of any present pollution, and the estimated cost of abating any pollution. (2) If no public hearing has been held under Paragraph (e), the division shall notify the permittee and any other interested parties in writing of its decision to release or not to release all or part of the performance bond or deposit within 60 days from the receipt of the completed application, or within 30 days from the public hearing if a public hearing was held. (3) The notice of the decision shall state the reasons for the decision, and recommend any corrective actions necessary to secure the release. (4) The division shall not release the bond until: (i) When any application for total or partial bond release is filed with the division, the division has notified the town, city, or other municipality nearest the operation and the county in which the surface coal mining operation is located by certified mail at least 30 days prior to the release of all or a portion of the bond; and (ii) The right to request a public hearing pursuant to 4 VAC 25-130-800.40(f) has not been exercised, or a final decision by the Hearing Officer approving the release has been issued pursuant to 4 VAC 25-130-800.40(f). (e) Any person wishing to contest the division's decision to approve or disapprove the bond release shall have the right to appeal in accordance with 4 VAC 25-130-800.40(f). In the event of an appeal, the division shall conduct the proceeding as provided by 4 VAC 25-130-800.40(f) through (h). 4 VAC 25-130-801.18. Criteria for release of bond. (a) The division shall release the bond applicable to the permit area following completion of all reclamation, restoration, and abatement work required of the permittee by the approved plans, this chapter, and the Act. (b) The minimum period of bond liability for the entire permit shall continue for not less than five years following completion of all reclamation work. This period of liability shall be in accordance with the provisions of 4 VAC 25-130-800.13 and 4 VAC 25-130-800.17(b). The total amount of bond for the permit area following this period of liability shall be as provided in Paragraph ( c) of this section. ( c) The division may choose to release portions of the bond, if the areas sought for release are capable of supporting the proposed postmining land use independent of the successful completion of the reclamation of portions of the permit area still under bond or not yet initially disturbed. A minimum of two full growing seasons must have elapsed before the division will consider any bond release for the permit area. Reclamation shall be deemed to be adequate when: (1) Revegetation has been established in accordance with the approved reclamation plan and the standards for the success of revegetation are met; (2) The lands are not contributing suspended solids to stream flow or runoff outside the permit area in excess of the requirements of Subchapter VK or the approved permit plans; and (3) With respect to prime farmlands, soil productivity has been returned to the level of yield as required by 4 VAC 25-130-785.17 and Part 823 when compared with non-mined prime farmland in the surrounding areas as determined from the soil survey performed under the plan approved under 4 VAC 25- 130-785.17; and (4) The provisions of a plan approved by the division for the sound future management of any permanent impoundment by the permittee or landowner have been implemented to the satisfaction of the division. (d) In the event a forfeiture occurs after partial bond release the division may, after utilizing the available bond monies, utilize the Fund as necessary to complete reclamation liabilities for the permit area. 4 VAC 25-130-801.19. Forfeiture. In the event of bond forfeiture pursuant to 4 VAC 25-130-800.50, the bond submitted in accordance with 4 VAC 25-130-801.12(b) shall: (a) Be utilized by the division in performing the necessary reclamation work before any monies are utilized from the Pool Bond Fund; however, (b) If an emergency, imminent danger or harm to the public or environment exists, the division may utilize the Pool Bond Fund for reclamation of those mining operations bonded pursuant to 4 VAC 25-130-801.12 ( c) and (d) if the Director determines that collection will delay the essential and necessary reclamation work required. Bond amounts subsequently collected shall be deposited into the Pool Bond Fund, up to but not exceeding the full amount of liabilities which the Pool Bond Fund incurred.