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EPA/SWER

RIN: 2050-AC71

Publication ID: Fall 2008

Title: RCRA Subtitle C Financial Test Criteria Regulatory Determination
Abstract: The RCRA subtitle C financial test is one of several mechanisms available to the regulated community for demonstrating financial assurance for closure/post-closure of their facilities. EPA decided at the end of the second quarter of FY 2007 to analyze whether regulatory changes are needed to ensure the tests continued and effective use. Test criteria have not been updated since promulgation in 1982. Concerns have been raised that the criteria are outdated and no longer adequately predict a companys continued solvency, such that some States are not allowing companies to use the test, reducing the number of mechanisms that are available. Although action external to EPA has been taken (e.g., passage of Sarbanes-Oxley Act) to address this market failure, the perception of a problem remains and continues to drive some States behavior. Providing the regulated community with a strong and effective financial test is an important regulatory function. In the absence of EPA taking action to analyze the issues and make changes, as appropriate, the availability of the test as a financial assurance mechanism will likely continue to be restricted. Therefore, we believe it is important to address this now so as to assure the continued availability of the financial test, thereby saving costs that would be incurred if an alternate mechanism had to be obtained or closure/post-closure activities were delayed. Additionally, some language in the financial test reporting requirements is no longer consistent with current professional standards under Generally Acceptable Accounting Principles. Addressing this inconsistency would facilitate implementation by regulators who may not have appropriate expertise to adequately review detailed financial information submissions. There are three options that EPA is considering. After analyzing these options, EPA may decide to proceed with a rulemaking utilizing these options either independently or in combination. If so, EPA will issue a new proposed rule. The three options are briefly described below: (1) Undertake targeted rulemaking to address documentation and reporting issues, particularly with respect to negative assurance language, as well as other implementation issues. (2) Undertake rulemaking to propose adding a ratings requirement to Alternative I of the financial test. [Note: This was the recommendation of the Environmental Financial Advisory Board (EFAB).] (3) Undertake rulemaking to propose adopting the financial test criteria that were promulgated as part of the standardized permit rule.
Agency: Environmental Protection Agency(EPA)	Priority: Other Significant
RIN Status: Previously published in the Unified Agenda	Agenda Stage of Rulemaking: Proposed Rule Stage
Major: No	Unfunded Mandates: No
CFR Citation: 40 CFR 264 and 265 40 CFR 280 40 CFR 761
Legal Authority: 42 USC 6912(a) 42 USC 6924 to 6926

Legal Deadline: None

Timetable:

Action	Date	FR Cite
NPRM Original	07/01/1991	56 FR 30201
NPRM	10/12/1994	59 FR 51523
NPRM on Determination	01/00/2009

Additional Information: SAN No. 2647
Regulatory Flexibility Analysis Required: No	Government Levels Affected: None
Small Entities Affected: No	Federalism: No
Included in the Regulatory Plan: No
Sectors Affected: 22111 Electric Power Generation; 221112 Fossil Fuel Electric Power Generation; 22132 Sewage Treatment Facilities; 311942 Spice and Extract Manufacturing; 323110 Commercial Lithographic Printing; 323114 Quick Printing; 32411 Petroleum Refineries; 32511 Petrochemical Manufacturing; 32512 Industrial Gas Manufacturing; 325131 Inorganic Dye and Pigment Manufacturing; 325188 All Other Basic Inorganic Chemical Manufacturing; 325193 Ethyl Alcohol Manufacturing; 325199 All Other Basic Organic Chemical Manufacturing; 325211 Plastics Material and Resin Manufacturing; 32551 Paint and Coating Manufacturing; 325998 All Other Miscellaneous Chemical Product Manufacturing; 331311 Alumina Refining; 33271 Machine Shops; 332813 Electroplating, Plating, Polishing, Anodizing and Coloring; 33299 All Other Fabricated Metal Product Manufacturing; 333319 Other Commercial and Service Industry Machinery Manufacturing; 333999 All Other General Purpose Machinery Manufacturing; 334 Computer and Electronic Product Manufacturing; 336 Transportation Equipment Manufacturing; 336399 All Other Motor Vehicle Parts Manufacturing; 42271 Petroleum Bulk Stations and Terminals; 4411 Automobile Dealers; 4471 Gasoline Stations; 45431 Fuel Dealers; 48422 Specialized Freight (except Used Goods) Trucking, Local; 56211 Waste Collection; 56221 Waste Treatment and Disposal; 56292 Materials Recovery Facilities; 811111 General Automotive Repair
RIN Data Printed in the FR: No
Agency Contact: Tricia Buzzell Environmental Protection Agency Solid Waste and Emergency Response 5303P, Washington, DC 20460 Phone:703 308-8622 Fax:703 308-8609 Email: buzzell.tricia@epa.gov