The financial assurance provisions provides a public policy to assure proper funding when a landfill is developed, so that routine maintenance and any necessary remediation work can continue for at least 30 years, even if the owner or operator is no longer in business or financially solvent at that time. Other issues to be incorporated into the financial assurance aspects of RCRA for MSW landfills include the length of time post-closure care must be provided, the magnitude of funding needed for future long-term care, appropriate financial assurance instruments, and mechanisms to ensure that funds will be available exclusively for post-closure care and remediation of contaminated ground water.
However, research indicates that there is a misconception that such stricter construction requirements, siting limitations, and monitoring requirements will eliminate the problem of polluting ground water (Lee, at 35-39). This is not addressed in the provisions, which postpone ground water pollution instead of preventing it. As a result, the landfill poses a threat to ground water quality for as long as wastes remain buried in the landfill.
Furthermore, the 30-year period for post-closure care mandated by the EPA takes into consideration only the initial time period over which the wastes in the lined landfill will represent a threat to ground water quality. Since the regulations refer to only a 30-year concept, landfill applicants typically prepare post-closure financial assurance plans presuming that the landfill will require no more than 30 years of post-closure care (Lee, at 35-39). Thus, research in this area indicate that the manner in which the regulations discourage development of programs to provide adequate funding for the long-term (Lee, at 35-39).
As a result, landfill owners, operators and the public must establish funding programs during the active life of the landfill to pay for perpetual care. The costs include expenditures for not only long-term maintenance, but also for arresting the spread of pollution that occurs, and for remediation of the ground water to the extent possible (Lee, at 35-39). This fund must be sufficient to cover plausible worst-case scenario contingencies, including the need to remove and treat the buried wastes in order to remove the source of ground water pollution when the pollution cannot be stemmed by other means (Lee, at 35-39).
Several public policy concerns have been raised as a result of the different approaches and predicted inability's of private waste management companies and public entities to meet post-closure care maintenance and contingencies. Both public agencies and private companies most likely will have difficulty keeping funds available for future needs of a closed landfill. In order to remain in business, private landfill companies must generate a net profit from the landfills they develop. However, research indicates that a net profit cannot be generated from a landfill if post-closure care consumes the profits from the landfill operation.
For example, in one case, a landfill company spent $60 million to purchase a gravel pit in southern California for the purpose of developing a 200-acre landfill (Lee, at 35-39). The company estimated it would generate a profit of $12 million/year during the approximately 20-year active life of the landfill (Lee, at 35-39). At that rate, the company would recover its initial investment in about five years; for the next 15 years the company would make a profit of about $80 million (Lee, at 35-39). The cost of closing the landfill and especially conducting post-closure care will, however, consume those profits (Lee, at 35-39). A private landfill company cannot accept the true post-closure care responsibilities and remain financially stable (Lee, at 35-39). This is a vivid representation that unless significant changes are made in the provisions for post-closure care funding,...
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