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Financial Assurance Overview


The Financial Assurance Module was developed to facilitate tracking of RCRA-regulated treatment, storage, and disposal (TSD) sites that are required to demonstrate financial assurance coverage for one or more of the following activities: closure, post-closure, third party liability, and corrective action. This module is designed to track the most up-to-date financial assurance information for a site and to keep a historical record of the changes.

The Cost Estimate table contains data that is required by TSD facilities, such as cost estimates from the permit applications and modifications. The closure and post-closure, and corrective action (if applicable) cost estimates must be updated annually to account for inflation. Revisions are made to the cost estimate as a result of applications, modifications, and closures. The financial assurance type contains only nationally-defined values.

Generally, the term financial assurance mechanism refers to the various types of financial mechanisms or instruments provided in 40 CFR 264 and 265, Subparts H; 40 CFR 261, Subpart H; and 40 CFR 267, Subpart H. The regulations use the terms financial assurance mechanism and financial assurance instrument interchangeably; though, RCRAInfo exclusively uses the term financial assurance mechanism or simply mechanism. Specifically, the list of acceptable mechanisms referenced in the regulations includes letters of credit, bonds (payment and performance), trust agreements (pay-in-trusts, fully funded trusts, and standby trusts), insurance, and self-insurance (i.e., financial test and corporate guarantee). The regulations that address financial assurance for Corrective Action are found in 40 CFR 264.101 (b) and (c), however, these two citations do not specify the mechanisms that may be used to satisfy the financial assurance requirements.

Ensuring compliance with RCRA's financial assurance requirements is a high priority for EPA. RCRAInfo will be the primary data used to assess the current compliance status of TSDFs. This data can also be used to assist States in determining the adequacy of financial assurance mechanisms being used by the TSDFs.