Yolo County Municipal Code Art. 7 Financial Assurances

Prior to the commencement of any mining activities, all new and existing surface mining operations conducted within the unincorporated territory of the County shall submit sufficient financial assurances to ensure the faithful performance of the reclamation plan approved pursuant to this chapter. (§ 1, Ord. 1191, eff. September 5, 1996)

Surface mining operations that are not undertaken by governmental agencies shall provide financial assurances in any one or a combination of the following forms:

(a) Surety bonds;

(b) Trust funds;

(c) Irrevocable letters of credit; and/or,

(d) Such other forms of financial assurances as the State Mining and Geology Board may adopt.

In addition those listed above, governmental agencies undertaking surface mining operations may provide financial assurances in the following forms:

(e) Pledges of revenue; and/or,

(f) Budget set asides. Financial assurances shall be issued by a corporate surety authorized to do conduct surety business in the State and shall be made payable to the “County of Yolo or the Department of Conservation.” Financial assurances that were approved by the County prior to January 1, 1993, and were made payable to the State Geologist shall be considered payable to the Department for the purposes of this chapter.

The form of such financial assurance instruments shall be subject to the approval of the County Counsel who may require such additional provisions as are necessary to ensure the performance of the obligations. (§ 1, Ord. 1191, eff. September 5, 1996)

The action approving a pledge of revenue shall take the form of a resolution or other appropriate document from the governing body of the agency responsible for reclamation. The resolution or document shall remain in effect continuously until the approved reclamation plan has been determined to be completed by the Director, pursuant to this chapter. The pledge of revenue shall consist of the following items:

(a) The resolution or document establishing the pledge of revenue;

(b) The types and sources of pledged revenue;

(c) The period of time that each source of revenue is pledged to be available;

(d) The estimated amount of financial assurances necessary to complete the approved reclamation plan; and,

(e) An authorization for the County or the Department to use the proceeds of the pledge to complete reclamation, if the operator is incapable of performing reclamation, as determined in Article 9 of this chapter.

The government agency may pledge the following types of revenue that it controls, as long as the revenue is available in a timely manner to perform the necessary reclamation work:

(f) Fees, rents, or other charges;

(g) Tax revenues within statutory limitations; and/or

(h) Other guaranteed revenues that are acceptable to the lead agency and the State Mining and Geology Board.

If the government agency ceases at any time to retain control of its ability to allocate pledged revenue to complete reclamation, the governing body of the agency shall notify both the lead agency and the Department within sixty (60) days after control lapses. (§ 1, Ord. 1191, eff. September 5, 1996)

Government agencies may also submit financial assurances in the form of a specific fund or line item set aside to provide funds for reclamation. The budget set aside shall remain in effect continuously until the approved reclamation plan has been determined to be completed by the Director, pursuant to this chapter. The budget set aside shall consist of the following items:

(a) A resolution or other appropriate document establishing the set aside or line item including proof of approval by the governing body or appropriate official of the government agency;

(b) The types and sources of specific funds;

(c) The period of time that each funding source is to be available;

(d) The estimated amount of financial assurances necessary to complete the approved reclamation plan; and,

(e) The authorization for the County or the Department to use the funds to complete reclamation, if the operator is incapable of performing reclamation, as determined in Article 9 of this chapter. (§ 1, Ord. 1191, eff. September 5, 1996)

Financial assurances shall remain in effect until the County has determined that the reclamation plan has been completed as approved. Financial assurances may be made renewable for periods of at least one year. However, the failure of an operator to renew any financial assurance before its expiration date shall be considered a violation of this chapter. New or renewed financial assurances shall be submitted to the County prior to the expiration date of the existing financial assurances. (§ 1, Ord. 1191, eff. September 5, 1996)

The amount of the financial assurances shall be equal to one-hundred (100%) percent of the estimated cost of implementing the approved reclamation plan. The estimated cost of reclamation shall be calculated by the operator and shall be based on the following factors:

(a) An analysis of the physical activities and materials necessary to implement the approved reclamation plan;

(b) The lead agency’s unit costs for each of the specified activities, or the unit costs for a third party contract, if applicable. When calculating the unit costs of reclamation activities, prevailing wage rates shall not be used,

(c) The number of units for each of the specified activities; and,

(d) An amount to cover contingency costs, not to exceed ten (10%) percent of the reclamation costs estimated above.

The costs associated with the completion of permitted mining shall not be used in the calculation of financial assurances.

The salvage value of buildings and equipment left on-site as a result of abandonment by the operator may be included to offset the costs of reclamation in the calculation of financial assurances. (§ 1, Ord. 1191, eff. September 5, 1996)

If a phased reclamation plan is approved, the initial amount of the financial assurances shall be no less than one-hundred (100%) percent of the total cost of all reclamation work to be done in the first approved phase. Before mining commences in the subsequent phase, additional financial assurances shall be submitted in an amount equal to one-hundred (100%) percent of the total cost of reclamation for that phase. (§ 1, Ord. 1191, eff. September 5, 1996)

As a part of the annual report, each operator shall submit a revised estimate of financial assurances for the following year. Financial assurances may be adjusted annually by the Director to account for any of the following factors:

(a) The addition of new permitted lands to be mined in the following year;

(b) Previously mined lands which have been completely reclaimed in accordance with the approved reclamation plan; and,

(c) The increased labor and/or material costs of reclamation. Any decision to either increase or decrease financial assurances shall become final within fifteen (15) days, unless appealed to the Planning Commission within that fifteen (15)- day period, as provided in Article 11 of this chapter. The review of existing financial assurances shall not be considered a project within the meaning of CEQA, pursuant to the exemption granted under Section 2770(c) of the Act. (§ 1, Ord. 1191, eff. September 5, 1996, as amended by § 2, Ord. 1407, eff. April 28, 2011)

The Director shall submit a copy of all new and revised financial assurance estimates and any supporting documentation to the Department for a forty-five (45)-day review period. No financial assurances may be approved until the Department has completed its review. The Director shall prepare a written response to any written comments received from the Department regarding the financial assurances submitted. If applicable, the Director’s response shall specifically address, in detail, why any comments or suggestions submitted by the Department were not accepted. The Director shall forward copies of both the Department’s comments and the Director’s response to the operator. (§ 1, Ord. 1191, eff. September 5, 1996)

If a surface mining operation is sold or ownership is transferred to another person, the existing financial assurances shall remain in full force and effect and shall not be released until new financial assurances are secured by the new owner and approved by the County. (§ 1, Ord. 1191, eff. September 5, 1996)

The mining operator shall notify the Director in writing when all or any portion of the required reclamation work is completed. Within sixty (60) days after notification to the County by the operator, the Director shall inspect the site in order to determine whether the site or the portion thereof complies with the approved reclamation plan. If it is determined that reclamation has not been completed pursuant to the approved reclamation plan, then the Director shall notify the operator in writing, specifically describing the remedial steps required for compliance. If it is determined that reclamation has been completed as approved, then the Director shall place the matter on the agenda of the Planning Commission for action within thirty (30) days. The Planning Commission may release all or a portion of the financial assurances, as appropriate. The Director shall send written notification of the proposed release of financial assurances to both the operator and the Department prior to the Planning Commission action. (§ 1, Ord. 1191, eff. September 5, 1996)

Prior to final approval of reclamation by the County and the release of financial assurances, if a reclaimed site or any reclaimed phases thereof have been adversely affected by a disaster, such as flood, earthquake, or other natural occurrence beyond the operator’s control, then the Director shall take the following factors into account in determining the operator’s responsibility:

(a) The extent to which the operator had completed reclamation prior to the natural occurrence;

(b) The extent to which the reclamation work has been destroyed by the natural occurrence;

(c) The effect of the natural occurrence on the public health and safety;

(d) The degree to which the site can be reclaimed naturally without human intervention;

(e) The specific reasons a particular monitoring period was established for reclamation; and,

(f) The site characteristics, reclamation program, and the proposed end use.

The operator may not be held responsible for the adverse impacts caused by a natural occurrence if the reclamation has been approved and the financial assurances released by the County. (§ 1, Ord. 1191, eff. September 5, 1996)