(b) The department may require an applicant for a permit to operate a mine, or a permittee holding a permit to operate a mine under the provisions of this section, to post a bond or bonds on forms prescribed and furnished by the department in favor of the Commonwealth of Pennsylvania and with good and sufficient collateral, irrevocable bank letters of credit or corporate surety guarantees acceptable to the department to insure that there will be compliance with the law, the rules and regulations of the department, and the provisions and conditions of such permit including but not limited to conditions pertaining to restoration measures or other provisions insuring that there will be no polluting discharge after mining operations have ceased. The department shall establish the amount of the bond required for each operation based on the cost to the Commonwealth of taking corrective measures in cases of the operator's failure to comply, or in such other amount and form as may be established by the department pursuant to regulations for an alternate coal bonding program which shall achieve the objectives and purposes of the bonding program. The department may, from time to time, increase or decrease such amount: Provided, however, That no bond shall be filed for less than ten thousand dollars ($10,000) for the entire permit area. The department shall also establish the duration of the bond required for each operation and at the minimum liability under each bond shall continue until such time as the department determines that there is no further significant risk of a pollutional discharge. The bond shall be conditioned upon the operator's faithful performance of the requirements of this act, the act of November 26, 1978 (P.L. 1375, No. 325), known as the "Dam Safety and Encroachments Act," the act of May 31, 1945 (P.L. 1198, No. 418), known as the "Surface Mining Conservation and Reclamation Act," the act of January 8, 1960 (1959 P.L. 2119, No. 787), known as the "Air Pollution Control Act," the act of September 24, 1968 (P.L. 1040, No. 318), known as the "Coal Refuse Disposal Control Act," and where applicable of the act of July 31, 1968 (P.L. 788, No. 241), known as the "Pennsylvania Solid Waste Management Act" or the act of July 7, 1980 (No. 97), known as the "Solid Waste Management Act" : Provided, however, That an operator posting a bond sufficient to comply with this section of the act shall not be required to post a separate bond for the permitted area under each of the acts hereinabove enumerated: And provided further, That the foregoing proviso shall not prohibit the department from requiring additional bond amounts for the permitted area should such an increase be determined by the department to be necessary to meet the requirements of this act. Where the minerals are to be removed by the underground mining method, and the mining operations are reasonably anticipated to continue for a period of at least ten years from the date of application, the operator may elect to deposit collateral and file a collateral bond as provided in this subsection according to the following phased deposit schedule. The operator shall, prior to commencing mining operations, deposit ten thousand dollars ($10,000) or twenty-five per cent of the amount of bond determined under this subsection, whichever is greater. The operator shall, thereafter, annually deposit ten per cent of the remaining bond amount for a period of ten years. Interest accumulated by such collateral shall become part of the bond. The department may require additional bonding at any time to meet the intent of this subsection. The collateral shall be deposited, in trust, with the State Treasurer as provided in this subsection, or with a bank, selected by the department, which shall act as trustee for the benefit of the Commonwealth, according to rules and regulations promulgated hereunder, to guarantee the operator's compliance with this act and the acts hereinabove enumerated. The operator shall be required to pay all costs of the trust. The collateral deposit, or part thereof, shall be released of liability and returned to the operator, together with a proportional share of accumulated interest, upon the conditions of and pursuant to the schedule and criteria for release provided for in rules and regulations promulgated hereunder. Upon the completion of any mining operation and prior to the release by the department of any portion of the bond liability, the operator shall remove and clean up all temporary materials, property, debris or junk which were used in or resulted from his mining operations. The failure to post a bond required by the department shall be sufficient cause for withholding a permit or for the suspension or revocation of an existing permit. If the operator fails or refuses to comply with the requirements of the act in any respect for which liability has been charged on the bond, the Secretary of the Department of Environmental Resources shall declare the bond forfeited, and shall certify the same to the Attorney General, who shall proceed to enforce and collect the amount of liability forfeited thereon, and where the operator has deposited cash or securities as collateral in lieu of a corporate surety, the secretary shall declare said collateral forfeited. If the operator is or was engaged in surface mining operations at the time of the violation, the secretary shall direct the State Treasurer to pay said funds into the Surface Mining Conservation and Reclamation Fund, or to proceed to sell said securities to the extent forfeited and pay the proceeds thereof into the Surface Mining Conservation and Reclamation Fund. If the operator is or was engaged in the operation of a deep mine at the time of the violation, the secretary shall direct the State Treasurer to pay said funds into The Clean Water Fund, or to proceed to sell said securities to the extent forfeited and pay the proceeds thereof into The Clean Water Fund. Should any corporate surety fail to promptly pay, in full, a forfeited bond, it shall be disqualified from writing any further bonds under this act. Any operator aggrieved by reason of forfeiting the bond or converting collateral, as herein provided, shall have a right to appeal such action to the Environmental Hearing Board. The department, in its discretion, may accept a self-bond from the permittee, without separate surety, if the permittee demonstrates to the satisfaction of the department a history of financial solvency, continuous business operation and continuous efforts to achieve compliance with all United States of America and Pennsylvania environmental laws, and, meets all of the following requirements:
(1) The permittee shall be incorporated or authorized to do business in Pennsylvania and shall designate an agent in Pennsylvania to receive service of suits, claims, demands or other legal process.(2) The permittee or if the permittee does not issue separate audited financial statements, its parent, shall provide audited financial statements for at least its most recent three fiscal years prepared by a certified public account in accordance with generally accepted accounting principles. Upon request of the permittee, the department shall maintain the confidentiality of such financial statements if the same are not otherwise disclosed to other government agencies or the public.(3) During the last thirty-six calendar months, the applicant has not defaulted in the payment of any dividend or sinking fund installment or preferred stock or installment on any indebtedness for borrowed money or payment of rentals under long-term leases or any reclamation fee payment currently due under the Federal Surface Mining Control and Reclamation Act of 1977, 30 U.S.C.§ 1232, for each ton of coal produced in the Commonwealth of Pennsylvania.(4) The permittee shall have been in business and operating no less than ten years prior to filing of application unless the permittee's existence results from a reorganization, consolidation or merger involving a company with such longevity. However, the permittee shall be deemed to have met this requirement if it is a majority-owned subsidiary of a corporation which has such a ten-year business history.(5) The permittee shall have a net worth of at least six times the aggregate amount of all bonds applied for by the operator under this section.(6) The permittee shall give immediate notice to the department of any significant change in managing control of the company.(7) A corporate officer of the permittee shall certify to the department that forfeiture of the aggregate amounts of self-bonds furnished for all operations hereunder would not materially affect the permittee's ability to remain in business or endanger its cash flow to the extent it could not meet its current obligations.(8) The permittee may be required by the department to pledge real and personal property to guarantee the permittee's self-bond. The department is authorized to acquire and dispose of such property in the event of a default to the bond obligation and may use the moneys in The Clean Water Fund to administer this provision.(9) The permittee may be required to provide third party guarantees or indemnifications of its self-bond obligations.(10) The permittee shall provide such other information regarding its financial solvency, continuous business operation and compliance with environmental laws as the department shall require.(11) An applicant shall certify to the department its present intention to maintain its present corporate status for a period in excess of five years.(12) A permittee shall annually update the certifications required hereunder and provide audited financial statements for each fiscal year during which it furnishes self-bonds.(13) The permittee shall pay an annual fee in the amount determined by the department of the cost to review and verify the permittee's application for self-bonding and annual submissions thereafter.