Qualifications of bond - Financial statements and inquiry - New bond required - Release of existing bond. A. 1. Terminal operators shall be required to post a bond of not less than three (3) months potential tax liability based on the number of gallons handled as estimated by the Commission, but in no event shall the bond be more than Five Hundred Thousand Dollars ($500,000.00). 2. Exporters shall be required to post a bond of not less than three (3) months potential tax liability based on the number of gallons handled as estimated by the Commission, but in no event shall the bond be more than One Million Dollars ($1,000,000.00). 3. Transporters shall be required to post a bond of not less than three (3) months potential tax liability based on the number of gallons handled as estimated by the Commission, but in no event shall the bond be more than One Hundred Thousand Dollars ($100,000.00). 4. Tank wagon importers shall be required to post a bond of not less than three (3) months potential tax liability based on the number of gallons handled as estimated by the Commission, but in no event shall the bond be more than Fifty Thousand Dollars ($50,000.00). B. Suppliers and bonded importers shall be required to post a bond of not less than three (3) months potential tax liability based on the number of gallons handled as estimated by the Commission, but in no event shall the bond be less than One Hundred Thousand Dollars ($100,000.00) nor more than Two Million Dollars ($2,000,000.00). An applicant may alternatively show proof of financial responsibility in the following amounts in lieu of posting of bond or in lieu of posting of the full amount of bond, which shall constitute evidence of financial responsibility in the absence of circumstances indicating the Commission is otherwise at risk with respect to collection of taxes from the applicant: 1. Proof of Five Million Dollars ($5,000,000.00) net worth shall constitute evidence of financial responsibility in lieu of posting of bond; 2. Proof of Two Million Five Hundred Thousand Dollars ($2,500,000.00) net worth shall constitute financial responsibility in lieu of posting one-half (1/2) of the bond; and 3. Proof of One Million Two Hundred Fifty Thousand Dollars ($1,250,000.00) net worth shall constitute financial responsibility in lieu of posting one-fourth (1/4) of the bond. C. If the applicant files a bond, the bond shall: 1. Be with a surety company approved by the Commission which may be an affiliate in the business of assuring such obligations; 2. Name the applicant as the principal and the state as the obliged; and 3. Be on forms prescribed by the Commission. D. The Commission may, at the reasonable discretion of the Commission, require a licensee, or an applicant, to furnish current verified, financial statements. The Commission may make independent inquiry into the financial condition of the applicant and, in any case, is not required to accept as accurate financial statements which have not been certified or independently audited. If the Commission determines that a financial condition of a licensee warrants an increase in the bond or cash deposit, the Commission may require the licensee to furnish an increased bond or cash deposit. E. 1. The Commission may require a licensee to file a new bond with a satisfactory surety in the same form and amount if: a. liability upon the previous bond is discharged or reduced by a judgment rendered, payment made, or otherwise disposed of, or b. in the opinion of the Commission, any surety on the previous bond becomes unsatisfactory. If the new bond is unsatisfactory, the Commission shall cancel the license. If the new bond is satisfactorily furnished, the Commission shall release in writing the surety on the previous bond from any liability accruing after the effective date of the new bond. 2. If a licensee has a cash deposit with the Commission and the deposit is reduced by a judgment rendered, payment made, or otherwise disposed of, the Commission may require the licensee to make a new deposit equal to the amount of the reduction. F. 1. If the Commission reasonably determines that the amount of the existing bond or cash deposit is insufficient to ensure payment to the state of the tax and any penalty and interest for which the licensee is or may become liable, the licensee shall, upon written demand of the Commission, file a new bond or increase the cash deposit. The Commission shall allow the licensee at least fifteen (15) days to secure the increased bond or cash deposit. 2. The new bond or cash deposit shall meet the requirements set forth in this act. 3. If the new bond or cash deposit required under this section is unsatisfactory, the Commission shall cancel the license. G. 1. Sixty (60) days after making a written request for release to the Commission, the surety of a bond furnished by a licensee shall be released from any liability to the state accruing on the bond after the sixty-day period. The release does not affect any liability accruing before the expiration of the sixty-day period. 2. The Commission shall promptly notify the licensee furnishing the bond that a release has been requested. Unless the licensee obtains a new bond that meets the requirements of this act and files with the Commission the new bond within the sixty-day period, the Commission shall cancel the license. 3. Sixty (60) days after making a written request for release to the Commission, the cash deposit provided by a licensee shall be canceled as security for any obligation accruing after the expiration of the sixty-day period. However, the Commission may retain all or part of the cash deposit for up to three (3) years and one (1) day as security for any obligations accruing before the effective date of the cancellation. Any part of the deposit not retained by the Commission shall be released to the licensee. Before the expiration of the sixty-day period, the licensee shall provide the Commission with a bond that satisfies the requirements of this act or the Commission shall cancel the license. 4. Any licensee who has filed a bond or other security under this act is entitled, on request, to have the Commission return, refund, or release the bond or security if, in the judgment of the Commission, the licensee has continuously complied with the provisions of this act for the previous three (3) consecutive years. However, if the Commission determines that the revenues of the state would be jeopardized by the return, refund or release of bond or security, the Commission may elect to retain the bond or security, or having released such, may reimpose a requirement for bond or security to protect the revenues of this state. The decision of the Commission to not release a bond or security may be reviewed, after application by the licensee, pursuant to the Administrative Procedures Act. H. In the event any applicant for a license applies for more than one license pursuant to this act, the applicant shall not be required to post a bond for each license, but shall be required to post the bond for the license which requires the greatest amount of bond.
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