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Reclamation Bond- A reclamation bond is a bond that guarantees protection of the public health, safety and welfare, during and after mining operations. It also guarantees restoration of the land to its original condition. Reclamation bonds are usually requested when working on federal land. Most sureties require collateral to issue this bond due to the duration and length for which most of these bonds have to stay in affect. Additionally, the hazardous condition and unforeseen circumstances of returning the land to "original" state is very ambiguous and difficult to clarify.
- When requesting a reclamation bond on an account that has already been previously submitted to the surety, among the most important information that needs to be provided to the surety are the following information:
- The Bond Request form - this will provide the surety with a basic overview of the current bond being requested.
- A copy of the complete contract. The contract will verify among other things: that a bond is required; the penal sum of the performance bond; the scope of work; the completion time, warranty period, penalty assessments, etc.
- If the obligee has their own reclamation bond form, surety company will want to verify that the form has acceptable language. If no required form exist, most sureties have their own generic form.
- Provide information as to how the principal plan on collateralizing for the bond in the liklihood that the surety will require collateral to consider issuing the bond.
- If the reclamation bond is the first bond being requested on behalf of a new contractor, the following information should be provided in the submission in addition to the above mentioned items.
- Contractor's Questionnaire.
- Business financial statements (balance sheet, income statement, statement of cash flows and aging schedule for accounts receivable and accounts payable) for the company's last 3 fiscal year end.
- Interim Business Financial Statements.
- Personal Financial Statement for all owners of the company
- Articles of incorporation (if corporation), LLC agreement (if business is a LLC) or partnership agreement (if business is a partnership).
- Bank reference letter and last 3 months most recent business and personal bank statements.
- Resume for all key personnel of the business.
- Copies of all insurance (general liability, professional liability, worker's compensation, etc).
- Current work in progress schedule.
- Copy of the contractor's license and other relevant licenses.
- Copy of the trust f any of the owners of the business have their assets held in that trust.