KRS 224.46-520: Prerequisites to issuance of permit for storage, treatment,

recycling, or disposal of hazardous waste -- Standards for closure --

Monitoring, maintenance, and remedial measures -- Financial

responsibility -- Closure for noncompliance.

(1) No person shall engage in the storage, treatment, recycling, or disposal of

hazardous waste without first notifying the cabinet and obtaining construction

and operation permits from the cabinet. The cabinet shall promulgate

regulations establishing standards for such permits but in no case shall a

permit to construct or operate a hazardous waste site or facility or a regional

integrated waste treatment and disposal demonstration facility be issued

unless it can be demonstrated that the proposed facility can be integrated into

the surroundings in an environmentally compatible manner, including but not

limited to, insuring that hydrologic, seismologic, geologic, and soil

considerations have been adequately addressed in the permit application and

in an operational plan. In no case shall a permit to construct a hazardous waste

incinerator, landfill, or other site or facility for the land disposal of hazardous

waste be approved or issued prior to notification of the cabinet by the local unit

of government of its actions pursuant to KRS 224.40-310(6). The cabinet shall

not issue a construction permit to a regional integrated waste treatment and

disposal demonstration facility until it has been issued a certificate of

environmental safety and public necessity. A person desiring a construction

permit shall file an application on forms supplied by the cabinet which shall

contain such information as the cabinet deems necessary and provide

evidence that the hazardous waste shall be treated, stored or disposed of in

the manner prescribed by the cabinet. The applicant shall not initiate

construction at the proposed site of a new facility for the storage, treatment, or

disposal of hazardous waste until notice has been given to that portion of the

public most likely to be affected by the operation of the proposed facility

pursuant to KRS 224.40-310(1) to (5) and until a construction permit for said

facility has been issued by the cabinet. The cabinet may consider past

performance in this or related fields by the applicant. The cabinet, in making a

determination to issue, deny, or condition a construction permit, shall consider

the following:

(a) An evaluation of alternatives, to include other locations and other

treatment, storage, and disposal approaches, different from those

proposed, available to the applicant;

(b) An evaluation of the public health, safety, and environmental aspects of

the proposals;

(c) An evaluation of the social and economic impacts of the proposed action

on the affected community, to include, at a minimum, changes in property

values, community perception and other psychic costs, and the costs and

availability of public services, facilities and improvements required to

support the facility and protect public health, safety, and the environment;

(d) An evaluation of mitigation measures to alleviate problems identified in

paragraphs (b) and (c) of this subsection; and

(e) The relationship of the proposal to local planning and existing

development.

Except that in the case of hazardous waste incinerators, landfills, or other sites

or facilities for the land disposal of hazardous waste, the provisions of

paragraphs (c) and (e) of this subsection shall be determined by the local unit

of government pursuant to KRS 224.40-310(6).

(2) The cabinet may prohibit the land disposal of any hazardous wastes. The

criteria and list of hazardous waste to be prohibited by the cabinet from land

disposal shall be identical to any such criteria and list promulgated by the

United States Environmental Protection Agency pursuant to the Resource

Conservation and Recovery Act of 1976, as amended, (Public Law 94-580).

The land disposal of hazardous waste may be permitted for methods

determined by the cabinet to be protective of human health and the

environment for as long as the waste remains hazardous.

(3) In conjunction with the application for permits under this section, the applicant

shall establish adequate financial responsibility as follows:

(a) The applicant shall file as part of his application for a permit to construct

the facility an estimate of the cost of closing the facility after its capacity is

reached or operations have otherwise ceased and an estimate of the cost

of post-closure care. In the case of storage facilities, the cost of closing

shall include the cost of properly disposing of the hazardous waste stored.

The cabinet shall evaluate this cost estimate and either accept the

estimate as made or shall revise it in accordance with acceptable

guidelines, using, where available, actual data on closure costs

associated with similar existing facilities. Before a permit to operate can

be issued, the applicant for any hazardous waste permit shall assure that

the funds needed to close the facility are available by establishing

assurance through one (1) or more of the following mechanisms: cash,

certificates of deposit, irrevocable credit, or other sureties satisfactory to

the cabinet and the mechanism shall be established by agreement with

the cabinet. The agreement shall provide that disbursement is permissible

only upon written approval of the cabinet and whenever, on the basis of

any information, the cabinet determines that the owner or operator is in

violation of any of the closure requirements for the facility, that the cabinet

shall have the right to use part or all of the closure fund to carry out the

closure requirements. The financial institution, surety company, or escrow

agent shall release these funds upon receiving a forfeiture order of the

cabinet issued pursuant to an appropriate administrative hearing

considering one (1) or more closure violations. Upon determination that

closure has been satisfactorily accomplished, the cabinet shall release

the applicant from further financial responsibility for closure;

(b) Any applicant for a hazardous waste disposal permit shall file with the

cabinet as part of his application an estimate of the annual cost of

post-closure monitoring and routine maintenance at the site. The cabinet

shall evaluate the cost estimate, and, after such modification as may be

necessary in light of its evaluation, shall give notice of acceptance of the

cost estimate. This cost estimate which will be referred to as the annual

post-closure operating cost shall then be used to determine the amount of

the post-closure monitoring and maintenance fund to be used for

monitoring and maintenance for a period of a minimum of thirty (30) years

after facility closure. The post-closure monitoring and maintenance fund

shall be cash, irrevocable credit, or other sureties satisfactory to the

cabinet and shall be established by an agreement with the cabinet. The

agreement shall provide that whenever, on the basis of any information,

the cabinet determines that the owner or operator of the facility is in

violation of any of the post-closure monitoring and maintenance

requirements, the cabinet shall have the right to use part or all of the

funds to carry out the post-closure monitoring and maintenance for the

facility. The funds shall be released upon receipt of a forfeiture order of

the cabinet issued pursuant to an appropriate administrative hearing

considering one (1) or more post-closure monitoring and maintenance

violations. One (1) year after closure, and annually thereafter for a period

of thirty (30) years, the applicant who has carried out all necessary

post-closure maintenance and monitoring requirements may upon

application to the cabinet be reimbursed out of the post-closure

monitoring and maintenance fund an amount equal to the estimated costs

for monitoring and routine maintenance for that year. Request for release

of funds for reimbursement shall be accompanied by an itemized list of

costs incurred. Upon determination that the expenditures incurred are in

accordance with the approved plan, or otherwise justified, the cabinet

may authorize the release of the funds to the applicant in writing. Any

funds remaining in the account following a termination hearing in which

the applicant is released of further responsibility shall likewise be released

to the applicant; and

(c) All applicants for any hazardous waste permit shall provide evidence of

financial responsibility in an amount and for a time period specified by the

cabinet for the purpose of corrective action on and off-site and satisfying

claims arising out of injury to persons or property resulting from the

release or escape of hazardous waste into the environment. Such

financial responsibility may be established by one (1) or a combination of

evidence of liability insurance, self-insurance, or other evidence of

financial responsibility acceptable to the cabinet. The level of

self-insurance shall not exceed ten percent (10%) of equity, and financial

responsibility shall be maintained during the entire operation of the facility

and until termination. The minimum liability coverage for sudden

occurrences, exclusive of legal defense costs, for a storage, treatment, or

disposal facility shall be one million dollars ($1,000,000) per occurrence

with an annual aggregate of two million dollars ($2,000,000). The

minimum liability coverage for nonsudden occurrences, exclusive of legal

defense costs, for a hazardous waste facility involving land disposal shall

be three million dollars ($3,000,000) per occurrence with an annual

aggregate of six million dollars ($6,000,000). Combined coverage for

sudden and nonsudden occurrences shall be no less than the combined

totals herein set forth for separate coverage. The cabinet shall accept a

demonstration of financial responsibility during the post-closure period of

a facility for a lesser amount for sudden or non-sudden occurrences

where it is shown that a lesser amount of financial responsibility will be

adequate to provide compensation for third-party injury or property

damage and corrective action, considering site and facility conditions and

other site-specific factors. Financial responsibility in post-closure for

sudden and non-sudden occurrences and corrective action may be

demonstrated through a letter of credit, surety or other bond, corporate

guarantee, trust fund, liability insurance, self-insurance, or combination of

these or other methods as approved by the cabinet.

(4) The cabinet shall promulgate regulations establishing minimal standards for

closure, post-closure monitoring and maintenance, and termination of sites for

the disposal of hazardous waste. Any person who obtains a disposal permit for

hazardous waste shall be responsible for the post-closure monitoring and

maintenance of the permitted facility for a minimum of thirty (30) years after

closure of the facility. The permittee may apply to the cabinet for termination of

the responsibility for post-closure monitoring and maintenance at any time

during the thirty (30) year post-closure monitoring and maintenance period.

Upon receipt of such application, the cabinet shall provide notice to the public

and to the owner or operator and an opportunity for a hearing on the

termination of the site. In this proceeding, the burden shall be on the applicant

to prove by clear and convincing evidence that additional post-closure

monitoring and maintenance is not necessary for adequate protection of public

health or the environment. The cabinet shall determine either that post-closure

monitoring and maintenance of the site is no longer required, in which case the

applicant shall be relieved of such responsibility; or that additional post-closure

monitoring and maintenance of the site as specified in a plan of operation is

still required, in which case the cabinet may order appropriate remedial

measures, impose restrictive covenants as to future use of the property

involved, or otherwise condition termination as may be necessary for adequate

protection of public health and the environment. The cabinet may require

additional monitoring, site maintenance, or remedial measures consistent with

KRS Chapter 224 any time after termination of the post-closure monitoring and

maintenance of the permitted facility in the event that the cabinet determines

such actions are necessary for the protection of human health and the

environment.

(5) In any case where the owner or operator is in bankruptcy, reorganization, or

arrangement pursuant to the Federal Bankruptcy Code or where jurisdiction

cannot be obtained with reasonable diligence in any state court or any federal

court over an owner or operator likely to be insolvent at the time of judgment,

any claim arising from conduct for which evidence of financial responsibility

shall be provided under this section may be asserted directly against the

guarantor providing such evidence of financial responsibility. In the case of any

action pursuant to this subsection, such guarantor shall be entitled to invoke all

rights and defenses which would have been available to the owner or operator

if any action had been brought against the owner or operator by the claimant

and which would have been available to the guarantor if an action had been

brought against the guarantor by the owner or operator.

(6) The total liability of any guarantor shall be limited to the aggregate amount

which the guarantor has provided as evidence of financial responsibility to the

owner or operator under this section. Nothing in this subsection shall be

construed to limit any other federal statutory, contractual or common law

liability of a guarantor to its owner or operator including, but not limited to, the

liability of such guarantor for bad faith either in negotiating or in failing to

negotiate the settlement of any claim. Nothing in this subsection shall be

construed to diminish the liability of any person under Section 107 or 111 of the

Comprehensive Environmental Response, Compensation and Liability Act of

1980 or other applicable law.

(7) For the purpose of this subsection, the term guarantor means any person,

other than the owner or operator, who provides evidence of financial

responsibility for an owner or operator under this section.

(8) Any hazardous waste treatment, storage, or disposal facility shall close in

accordance with the permit and this chapter, if the site or facility has not been

maintained in operational condition in conformance with this chapter, for any

period of six (6) months or longer. The permittee shall be afforded an

opportunity to be heard on the proposed termination of authorization to

operate, and termination under this section shall not be required where the

permittee demonstrates that steps have been taken to bring the facility, within a

reasonable time not to exceed ninety (90) days, into full operational status in

accordance with this chapter and applicable regulations. Within ninety (90)

days, the cabinet shall review existing hazardous waste treatment, storage, or

disposal permits to determine compliance with this section.