(a) General rule. --After a surface mining permit has been approved, but before the permit is issued, the applicant shall file, with the department, a bond for the land affected by each operation, on a form to be prescribed and furnished by the department, payable to the Commonwealth and conditioned that the permittee shall faithfully perform all of the requirements of this act and of the act of June 22, 1937 (P.L. 1987, No. 394), known as The Clean Streams Law; the act of January 8, 1960 (1959 P.L. 2119, No. 787), known as the Air Pollution Control Act; and, where applicable, the act of September 24, 1968 (P.L. 1040, No. 318), known as the Coal Refuse Disposal Control Act; the act of November 26, 1978 (P.L. 1375, No. 325), known as the Dam Safety and Encroachments Act; the act of July 31, 1968 (P.L. 788, No. 241), known as the Pennsylvania Solid Waste Management Act, or theact of July 7, 1980 (P.L. 380, No. 97) , known as the Solid Waste Management Act; and the act of May 31, 1945 (P.L. 1198, No. 418), known as the Surface Mining Conservation and Reclamation Act. (b) Separate bonds not required.--An operator posting a bond sufficient to comply with this section shall not be required to post a separate bond for the permitted area under each of the acts enumerated in subsection (a). This subsection 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.(c) Amount of bond.--The amount of the bond required shall be in an amount determined by the department based upon the total estimated cost to the Commonwealth of completing the approved reclamation plan or in such other amount and form as may be established by the department under regulations for an alternate bonding program that shall achieve the objectives and purposes of the bonding program. The estimate shall be based upon the permittee's statement of his estimated cost of fulfilling the plan during the course of his operation, inspection of the application and other documents submitted, inspection of the land area and such other criteria as may be relevant, including, but not limited to, the probable difficulty of reclamation, giving consideration to such factors as topography, geology of the site, hydrology, the proposed land use and the additional cost to the Commonwealth which may be entailed by being required to bring personnel and equipment to the site after abandonment by the permittee in excess of the cost to the permittee of performing the necessary work during the course of his surface mining operations. No bond shall be filed for less than $5,000 for the entire permit area. When the plan involves the reconstruction or relocation of any public road or highway and when the Department of Transportation has required a bond sufficient to fully build or restore the road or highway to a condition approved by that department, no additional bond for building or restoring the road or highway shall be required under this act.(d) Duration of liability under bond.--Liability under the bond shall be for the duration of the surface mining at each operation and for a period of five years after the last year of augmented seeding and fertilizing and any other work to complete reclamation to meet the requirements of law and protect the environment, unless released in whole or in part prior thereto as provided in this act.(e) Bond requirements; alternatives.--The bond shall be executed by the operator and a corporate surety licensed to do business in this Commonwealth and approved by the secretary. The permittee may elect to deposit with the department, in lieu of a corporate surety, cash, automatically renewable irrevocable bank letters of credit, which may be terminated by the bank at the end of a term only upon the bank giving 90 days prior written notice to the permittee and the department, or negotiable bonds of the Federal Government or of the Commonwealth, the Pennsylvania Turnpike Commission, the General State Authority, the State Public School Building Authority or any municipality within this Commonwealth. The cash deposit amount of the irrevocable letter of credit or market value of the securities shall be equal at least to the sum of the bond. Upon receipt of any such deposit of cash, letters of credit or negotiable bonds, the secretary shall immediately place the same with the State Treasurer, whose duty shall be to receive and hold the deposit in the name of the Commonwealth, in trust, for the purposes for which the deposit is made. The State Treasurer shall at all times be responsible for the custody and safekeeping of the deposits.(f) Substitution for bond or other collateral.--The permittee making the deposit shall be entitled, from time to time, to demand and receive from the State Treasurer, on the written order of the secretary, the whole or any portion of any collateral so deposited, upon depositing with the State Treasurer, in lieu thereof, other collateral of the classes specified in this section having a market value at least equal to the sum of the bond or, to substitute a bond for the cash, automatically renewable irrevocable bank letters of credit or negotiable bonds and also to demand, receive and recover the interest and income from the negotiable bonds as it becomes due and payable. Where negotiable bonds, deposited as provided in this section, mature or are called, the State Treasurer, at the request of the permittee, shall convert the negotiable bonds into other negotiable bonds of the classes specified in this section as may be designated by the permittee. Where notice of intent to terminate a letter of credit is given, the department shall give the permittee 30 days' written notice to replace the letter of credit with other acceptable bond guarantees as provided in this section and, if the permittee fails to replace the letter of credit within the 30-day notification period, the department shall draw upon and convert the letter of credit into cash and hold it as a collateral bond guarantee.(g) Self-bond may be accepted.--The department may accept a self-bond from the permittee, without separate surety, if the permittee demonstrates, to the satisfaction of the Insurance Department, a history of financial solvency, continuous business operation and continuous efforts to achieve compliance with all Federal and Pennsylvania environmental laws and Pennsylvania insurance laws, complies with other requirements as the Insurance Department may reasonably require by regulation 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 accountant in accordance with generally accepted accounting principles. Upon request of the permittee, the department shall maintain the confidentiality of the financial statements if the same are not otherwise disclosed to other government agencies or the public.(3) During the last 36 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 fees payment currently due under section 402 of the Surface Mining Control and Reclamation Act of 1977 ( Public Law 95-87, 30 U.S.C. § 1232 ) for each ton of coal produced in the Commonwealth.(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 that 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 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 other information regarding its financial solvency, continuous business operation and compliance with environmental laws as the department or the Insurance Department shall require.(11) The permittee shall certify 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 Insurance Department, of the cost to review and verify the permittee's application for self-bonding and annual submissions thereafter.(h) Term of bond in certain cases.--(1) Notwithstanding subsection (d), in the case of applications for the mining of minerals where the department determines that the mineral to be extracted exceeds the amount of overburden by a ratio of at least four to one or that the minerals are to be removed by underground mining methods and where the mining operations are reasonably anticipated to continue for a period of at least ten years from the date of the application, the term of the bond shall be for the duration of the mining and reclamation operations and for five years thereafter. The operator, in the case of mining and reclamation operations mentioned in this subsection, may elect to deposit collateral and file a collateral bond as provided in subsections (e) and (f), according to the phased deposit schedule set forth in paragraph (2).(2) The operator shall, prior to commencing mining operations, deposit $10,000 or 25% of the amount of the bond determined under subsection (c), whichever is greater. The operator shall, thereafter, annually deposit 10% of the remaining bond amount for a period of ten years. Interest accumulated by the collateral shall become a part of the bond until such time as the collateral, plus accumulated interest, equals the amount of the required bond. The department may require additional bonding at any time to meet the intent of subsection (a). The collateral shall be deposited, in trust, with the State Treasurer as provided in subsection (e) or with a bank selected by the department which shall act as trustee for the benefit of the Commonwealth, according to the regulations promulgated under this act, to guarantee the operator's compliance with this act and the statutes enumerated in subsection (a). The operator shall be required to pay all costs of the trust.(3) 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 under the schedule and criteria for release provided in subsection (j).(i) Payment in lieu of bond.--(1) In lieu of the bond otherwise required by this section, the operator may elect to pay to the department, for deposit in the fund established by section 17 , an amount equal to the average surety bond premium charged by bonding companies, as determined by the Insurance Commissioner, which the operator would otherwise be required to pay in order to obtain a surety bond under this act, except that the annual payment shall be a pro rata amount of the premiums if the average premium, as determined by the Insurance Commissioner, is for a period longer than one year. Such annual payment, however, shall in no event be lower than the rate being applied by the department to operators on the effective date of this act. The department may annually adjust the amount to insure that there are sufficient funds in this account to reclaim sites for which bonds posted under this subsection were forfeited.(2) The initial payment for any bonded area shall be made to the department at the time or times the operator would have been required to post a surety bond under this act and shall thereafter be made at the same time that the operator applies for a license renewal under section 5 . These payments shall be retained by the Commonwealth and shall not be refundable to the operator.(3) Payments under this subsection shall excuse the operator from the requirement to post a bond under this act with respect to the operation for which payment is made. No person may make payments under this subsection, unless that person demonstrates to the department that he is unable to post the bond otherwise required by this section.(j) Release. --Subject to the public notice requirements in section 10, if the department is satisfied that the reclamation recovered by the bond portion thereof has been accomplished as required by this act, it may, upon request by the permittee, release, in whole or in part, the bond according to the reclamation schedule and criteria for release of bonds set forth in regulations promulgated hereunder. No bond shall be fully released until all requirements of this act are fully met. Upon release of all or part of the bond and collateral as herein provided, the State Treasurer shall immediately return to the operator the amount of cash or securities specified therein.(k) Forfeiture.--(1) If the operator fails or refuses to comply with any requirement of this act for which liability has been charged on the bond, the department shall declare the bond forfeited.(2) Upon certification of surety bond forfeiture by the department, the Office of Attorney General shall promptly collect the bond and pay the proceeds into the fund. Where the operator deposited cash or securities as collateral, the department shall sell the collateral and pay the proceeds into the fund or direct the State Treasurer to pay the proceeds into that fund.(3) The department shall not accept any surety bond written by a corporate surety that failed to promptly and fully pay a forfeited bond under this act or any of the statutes enumerated in section 7(c)(9) . 1984, Dec. 19, P.L. 1093, No. 219, § 9, effective in 60 days.