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2023 - 2024 LEGISLATURE
2023 ASSEMBLY BILL 492
October 12, 2023 - Introduced by Representatives MURSAU and SCHMIDT. Referred
to Committee on Local Government.
***AUTHORS SUBJECT TO CHANGE***
AN ACT to amend 20.370 (4) (dq), 289.41 (3) (c), 289.41 (11) (a) 4. and 289.68 (1);
and to create 20.370 (4) (dr), 289.41 (3m) and 289.68 (4m) of the statutes;
relating to: method for establishing proof of financial responsibility for
municipal solid waste facilities; payments for closure, long-term care, and
corrective action costs for certain solid or hazardous waste facilities; extending
the time limit for emergency rule procedures; providing an exemption from
emergency rule procedures; granting rule-making authority; and making an
appropriation.
Analysis by the Legislative Reference Bureau
Proof of financial responsibility for municipal solid waste facilities
This bill provides an alternative method for a municipality to establish the
proof of financial responsibility required for a solid waste facility.
Under current law, the owner or operator of a solid or hazardous waste storage,
treatment, or disposal facility (owner or operator) must maintain proof of financial
responsibility to ensure the availability of funds for compliance with closure and
long-term care requirements and, if necessary, for taking any required corrective
action in the event of a spill or leak. The standard method for proving financial
responsibility is to obtain, for example, a bond, deposit, escrow account, or
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ASSEMBLY BILL 492
irrevocable trust that is payable to or established for the benefit of the Department
of Natural Resources. Alternatively, current law allows an owner or operator that
is a for-profit business or a public heat, light, water, or power utility to establish
proof of financial responsibility to ensure compliance with closure and long-term
care requirements using a net worth test. The net worth test requires, among other
things, a certain level of net worth, liabilities to net worth ratio, and credit
worthiness.
This bill allows a municipality that owns or operates a solid waste facility to use
an alternative method to establish proof of financial responsibility to ensure
compliance with closure and long-term care requirements and any required
corrective action, similar to the method allowed for local governments under federal
law. Under the bill, a municipality may prove financial responsibility by showing
either that all of its outstanding general obligation bonds have a rating of at least
“Baa” if issued by Moody's or at least “BBB” if issued by Standard & Poor's, or that
its ratio of cash plus marketable securities to total expenditures is 0.05 or greater and
that its ratio of annual debt service to total expenditures is 0.20 or lower. Under the
bill, if a solid waste facility is owned or operated by more than one municipality, any
of the municipalities may establish proof of financial responsibility on behalf of itself
and the other owners or operators. The bill also requires DNR to establish additional
rules relating to the alternative method established under this bill.
Payment of closure, long-term care, and corrective action costs
This bill also allows DNR to pay costs associated with closure and long-term
care requirements and any required corrective action for a solid or hazardous waste
storage, treatment, or disposal facility that has established proof of financial
responsibility using either the net worth test or the alternative method for municipal
facilities that is created under the bill. The bill allows DNR to pay these costs if the
owner or operator has failed to comply with closure, long-term care, or corrective
action requirements specified in any rule, order, plan of operation, or other plan
approval and if either 1) the owner or operator's failure to comply is due to
bankruptcy, insolvency, or other inability to pay the costs, or 2) DNR determines that
the failure to comply presents an imminent or substantial danger to human health
or the environment.
To cover these costs, the bill allows DNR to transfer moneys from an existing
appropriation account, which is funded from the segregated waste management
fund, to a new appropriation account dedicated to this purpose. Under the bill, DNR
must request approval from the Joint Committee on Finance for any transfers that
are intended to support payments for a facility that exceed $300,000, and must notify
JCF of all other transfers.
For further information see the state and local fiscal estimate, which will be
printed as an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows: - 3 -2023 - 2024 Legislature
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SECTION 1
ASSEMBLY BILL 492
SECTION 1. 20.370 (4) (dq) of the statutes is amended to read:
20.370 (4) (dq) Solid waste management — waste management fund. From the
waste management fund, all moneys received in the waste management fund, except
moneys appropriated under pars. (dr), (dt), (dy) and (dz), for the purpose of
administering a program of corrective action, closure, and long-term care of and
environmental repairs to solid and hazardous waste facilities under s. 289.68.
SECTION 2. 20.370 (4) (dr) of the statutes is created to read:
20.370 (4) (dr) Solid waste management — department action on corrective
action, closure, and long-term care. From the waste management fund, all moneys
received under s. 289.68 (4m) (b) for the purpose of administering a program of
corrective action, closure, and long-term care of solid and hazardous waste facilities
under s. 289.68 (4m) (a).
SECTION 3. 289.41 (3) (c) of the statutes is amended to read:
289.41 (3) (c) Changes. The owner or operator may change from one standard
method of establishing proof of financial responsibility under par. (a) to another or
standard method under par. (a), to an alternative method under sub. (3m), or to a net
worth method of establishing proof of financial responsibility under sub. (4).
SECTION 4. 289.41 (3m) of the statutes is created to read:
289.41 (3m) ALTERNATIVE METHOD OF ESTABLISHING FINANCIAL RESPONSIBILITY FOR
SOLID WASTE DISPOSAL FACILITIES; MINIMUM FINANCIAL STANDARDS FOR MUNICIPALITIES. (a)
Alternative method requirements. A municipality may establish proof of financial
responsibility for solid waste disposal facilities as required under sub. (2) by applying
to the department and meeting the alternative method requirements. The
department shall establish by rule the minimum financial requirements for a
municipality to establish proof of financial responsibility under this subsection. If
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SECTION 4 ASSEMBLY BILL 492
a facility is owned or operated by more than one municipality, any such municipality
may establish proof of financial responsibility under this subsection on behalf of
itself and the other municipalities that are owners or operators. A municipality that
seeks to establish proof of financial responsibility under this subsection shall satisfy
the minimum financial requirements established by rule and all of the following
requirements:
1. If the municipality has any outstanding, rated, general obligation bonds,
none have been rated lower than “Baa” as issued by Moody's Investors Service or
“BBB” as issued by Standard & Poor's Corporation.
2. The municipality's most recent audited annual financial statement shows
a ratio of cash plus marketable securities to total expenditures of not less than 0.05,
and a ratio of annual debt service to total expenditures of not greater than 0.20.
(b) Failure to meet alternative method requirements. If at any time the
department determines that a municipality does not meet the minimum financial
requirements under par. (a) 1. and 2. and established by rule, the municipality shall,
within 45 days of the department's determination, establish proof of financial
responsibility using one of the standard methods under sub. (3).
SECTION 5. 289.41 (11) (a) 4. of the statutes is amended to read:
289.41 (11) (a) 4. The department may request the department of justice to
initiate court action against the owner or operator to recover moneys sufficient to pay
the cost of complying with the closure and long-term care requirements of the
specified in any rule, order, plan of operation, or other plan approval or approved plan
under s. 291.29. Any moneys recovered in this type of action or as a settlement in
anticipation of this type of action shall be credited to the waste management fund.
SECTION 6. 289.68 (1) of the statutes is amended to read:
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SECTION 6
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289.68 (1) PAYMENTS FROM THE WASTE MANAGEMENT FUND. The department may
expend moneys in the waste management fund only for the purposes specified under
subs. (3) to (6) and 1991 Wisconsin Act 39, section 9142 (2w). The department may
expend moneys appropriated under s. 20.370 (4) (dq) for the purposes specified under
subs. (3) and (5) and 1991 Wisconsin Act 39, section 9142 (2w). The department may
expend moneys appropriated under s. 20.370 (4) (dt) for the purposes specified under
sub. (4). The department may expend moneys appropriated under s. 20.370 (4) (dy)
and (dz) for the purposes specified under sub. (6). The department may expend
moneys appropriated under s. 20.370 (4) (dr) for the purposes specified under sub.
(4m).
SECTION 7. 289.68 (4m) of the statutes is created to read:
289.68 (4m) PAYMENTS OF CLOSURE, LONG-TERM CARE, AND CORRECTIVE ACTION
COSTS. (a) Payments. The department may expend moneys appropriated under s.
20.370 (4) (dr) to pay costs associated with closure, long-term care requirements, and
corrective action for a facility that has established proof of financial responsibility
under s. 289.41 (3m) or (4), if the owner or operator of the facility has failed to comply
with closure, long-term care, or corrective action requirements specified in any rule,
order, plan of operation, or other plan approval and if any of the following applies:
1. The owner or operator's failure to comply is due to bankruptcy, insolvency,
or other inability to pay the costs.
2. The department determines that the failure to comply presents an imminent
or substantial danger to human health or the environment.
(b) Transfer of funds; joint finance approval. The department may transfer
money from the appropriation account under s. 20.370 (4) (dq) to the appropriation
account under s. 20.370 (4) (dr) for the purposes specified under par. (a). The
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department shall notify the joint committee on finance of transfers that are intended
to support payments for a facility under par. (a) that do not exceed $300,000. The
department may not make any transfers that are intended to support payments for
a facility under par. (a) that exceed $300,000 without approval from the joint
committee on finance.
SECTION 8.0Nonstatutory provisions.
(1) EMERGENCY RULES. The department of natural resources shall use the
procedure under s. 227.24 to promulgate rules under s. 289.41 (3m) no later than the
first day of the 7th month beginning after the effective date of this subsection.
Notwithstanding s. 227.24 (1) (c) and (2), emergency rules promulgated under this
subsection remain in effect until the first day of the 36th month beginning after the
effective date of the emergency rules or the date on which permanent rules take
effect, whichever is earlier. Rules promulgated under this subsection shall, at a
minimum, reflect the minimum financial requirements established in s. 289.41 (3m)
and in 40 CFR 258.74 (f), as amended. Notwithstanding s. 227.24 (1) (a) and (3), the
department of natural resources is not required to provide evidence that
promulgating a rule under this subsection as an emergency rule is necessary for the
preservation of public peace, health, safety, or welfare and is not required to provide
a finding of emergency for a rule promulgated under this subsection.
(END)
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