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Kentucky Meth Lab Cleanup Contractor Surety Bond

Meth Lab Cleanup Contractor Surety Bond

It is not breaking news that crystal methamphetamine or "meth" has rapidly become a national scourge. Highly addictive and ultimately deadly to users, its production introduces volatile and extremely toxic chemicals into the environment. The ingredients used in the "cooking" process of making meth often include ether, paint thinner, Freon, acetone, anhydrous ammonia, iodine crystals, red phosphorus (R-P), drain clearing solvents, battery acid, and lithium extracted from batteries. It is estimated that every pound of meth made can generate five pounds of toxic waste that contaminate homes, soil and groundwater. The buildings, often homes and trailers in rural areas, are quickly made uninhabitable by the waste created during the manufacture of meth. Due to the dangerous and toxic nature of this waste, specialty meth cleanup contractors are employed to decontaminate properties affected by meth labs.

In response to the need for contractors qualified to accomplish meth lab cleanups, the State of Kentucky enacted legislation in 2010 creating a special class of license for contractors specializing in this work. Only contractors certified by the Kentucky Environmental Cabinet may conduct decontamination services of inhabitable properties. Among the requirements for a license, a registrant must provide a meth cleanup contractor surety bond. This bond may be written in the amount of $100,000 for those contractors providing services to Tier 1, 2 and 3 contaminated locations, or $250,000 for contractors working Tier 4 locations. (The tiered response system is defined by KY Gen. Statute 224.1-410, and is based on evidence of the volume of production and severity of contamination.)

The meth cleanup contractor bond is a very specific obligation. It is required for the purposes of "assuring proper methamphetamine decontamination services of inhabitable properties" in accordance with the current laws and regulations. Essentially this surety bond is a very standard-looking license and permit (L&P) bond however it has a very important performance bond-type of enhancement. Surety and principal MUST understand the standard to which contamination cleanup must be accomplished. It is measured by the state and must "pass". The obligation is cancelable however the form requires notice from the surety 120 days PRIOR to the anniversary date of the bond. If timely notice of cancellation is not given, then the obligee is entitled to an automatic extension of the bond for one year. The surety bond also contains a forfeiture provision, requiring payment of the full penalty upon demand by the State. There is no indication within the bond form that the surety's liability is cumulative from year to year. Understanding the nature of this obligation is paramount to compliance and to avoid a breach.

Exposure to the chemicals used in a meth cooking operation can pose significant hazards both from direct contact with or inhalation of the same. Burns, tissue irritation and rashes occur with skin contact. Headaches, dizziness, nausea and other dangerous effects can be the result of vapor inhalation. It is almost impossible for a meth cleanup contractor not to come in contact with these substances. Further, the Kentucky Division of Waste Management opines that, "airborne contaminants are absorbed into soft materials including rugs, furniture, drapes, walls and other surfaces and may also contaminate the heating, ventilation and air conditioning system of the structure. Spills are common in meth labs, and may impact floors, walls, appliances and other surfaces. Potentially hazardous chemicals used in meth cooking may be dumped down the sinks, toilets or drains in the kitchen or bathrooms and leave contamination in the wastewater system." These are not insignificant considerations for the contractor or the surety that chooses to underwrite the meth cleanup contractor bond. Similar to the asbestos/superfund disaster, environmental risks of this sort concern surety underwriters. In efforts to minimize the risk of an undue surety bond claim the obligation is worded specifically, registrants are obligated to report completion of OSHA's HAZWOPER certification course, and registrants must produce evidence of sufficient liability insurance coverage.

What We Need From You

Additional Attachments

  • Current business financial statement.
  • Copy of OSHA HAZWOPER certification.
  • Copy of liability insurance certificate.