R 425.305 Irrevocable letter of credit.

Rule 305. (1) Subject to R 425.301, an operator may satisfy all or a portion of the financial assurance requirements by obtaining an irrevocable letter of credit that conforms to the requirements of this rule and is executed on a form approved by the department. The issuing institution shall be a bank or financial institution which has the authority to issue letters of credit and whose letter of credit operations are regulated and examined by a federal or state agency. (2) The letter of credit shall include all of the following information: (a) The name of the operator. (b) The name and address of the mine. (c) The amount of funds assured for reclamation, remediation, and postclosure monitoring by the letter of credit. (3) The letter of credit shall be issued for a period of at least 1 year and shall be irrevocable during its term. The letter of credit shall be automatically extended for additional terms of 1 year from the current or each future expiration date unless the issuing institution provides the permittee and the department, at least 60 days before the current expiration date, written notice by certified mail that the issuing institution elects to terminate the letter of credit at the end of its then current term. (4) The irrevocable letter of credit shall not be for an amount in excess of 10 percent of the bank's capital surplus account as shown on a balance sheet certified by a certified public accountant. (5) The issuing institution shall notify the department immediately if the issuing institution becomes ineligible to issue a letter of credit.