(a) An owner or operator may satisfy the requirements of financial assurance by obtaining a surety bond which conforms to the requirements of this section, in addition to the requirements specified in Subchapters A and B of this chapter (relating to General Financial Assurance Requirements and Financial Assurance Requirements for Closure, Post Closure, and Corrective Action), and submitting an originally signed surety bond to the executive director.
(b) The bond must, at a minimum, be among those listed as acceptable sureties on federal bonds in Circular 570 of the United States Department of Treasury.
(c) The wording of the surety bond must be identical to the wording specified in §37.321 of this title (relating to Performance Bond).
(d) A surety bond guaranteeing performance of closure, post closure, or corrective action must guarantee that the owner or operator shall:
  (1) perform closure or post closure in accordance with the closure plan, post closure plan, and other applicable requirements of the permit, or perform corrective action in accordance with the permit or other applicable requirements; and
  (2) provide alternate financial assurance as specified in this subchapter, and obtain the executive director's written approval of the assurance provided within 90 days after receipt by both the owner or operator and the executive director of a notice of cancellation of the bond from the surety.
(e) Under the terms of the bond, the surety shall become liable on the bond obligation when the owner or operator fails to perform as guaranteed by the bond. Following a determination by the executive director that the owner or operator has failed to perform closure or post closure in accordance with the closure plan, post closure plan, or other applicable requirements of the permit, or has failed to perform corrective action in accordance with the permit or other applicable requirements, under terms of the bond, the surety shall either perform closure, post closure, or corrective action as guaranteed by the bond or deposit the amount of the penal sum of the bond into a standby trust, in accordance with §37.161 of this title (relating to Establishment of a Standby Trust).
(f) Under the terms of the bond, the surety may cancel the bond by sending notice of cancellation by certified mail to the owner or operator and to the executive director. Cancellation of the bond may not occur, however, during the 120 days beginning on the date of the receipt of the notice of cancellation by both the owner or operator and the executive director, as evidenced by the return receipts. If the owner or operator fails to provide an alternate financial assurance mechanism as specified in this subchapter within 90 days of the receipt of notice of cancellation from the surety to the executive director and to the owner or operator, and obtain written approval of the alternate assurance from the executive director, the surety shall be required to perform under the terms of the bond.
(g) The penal sum of the bond must be in an amount at least equal to the current cost estimate, except as provided in §37.41 of this title (relating to Use of Multiple Financial Assurance Mechanisms) or §37.52 of this title (relating to Use of a Universal Financial Assurance Mechanism for Multiple Facilities and Program Areas).
(h) The surety shall not be liable for deficiencies in the performance of closure, post closure, or corrective action by the owner or operator after the executive director releases the owner or operator from the requirements of this section, in accordance with Subchapter A of this chapter.

Source Note: The provisions of this §37.221 adopted to be effective December 30, 1996, 21 TexReg 12297; amended to be effective March 21, 2000, 25 TexReg 2347