EPA Surety Bond Requirements for the Transition Program for Equipment Manufacturers (TPEM)

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Bond Penalty: Power Category 'x' Number of Units

The Transition Program for Equipment Manufacturers (TPEM) or "flexibility program," is a temporary exemption that allows diesel equipment manufacturers to delay installing Tier 4-compliant engines in their units for a determined period of time. A TPEM surety bond is required from only one class of participant. The bond requirement is addressed in §1039.626.

TPEM registrants that fall in to the "importer" category must post an EPA surety bond to cover any potential enforcement actions under the Clean Air Act. The TPEM bond penalty is based on the per-engine bond values shown here:

For engines with maximum engine power falling in the following ranges... The per-engine bond value is...
kW <19 $150
19 ≤W <56 $300
56 ≤kW <130 $500
130 ≤kW <225 $1,000
225 ≤kW <450 $3,000
kW ≥450 $8,000


EPA - TPEM Surety Bond Worksheet for Calculating Assurance Amount

and on the highest number of engines in each power category imported by the operator in any single calendar year under the program. If your estimated or actual engine imports increase beyond the level appropriate for the participant's current EPA bond then the principal must post additional penalty to reflect the increased sales within ninety days of a change in estimate or determination of actual sales. The TPEM bond may NOT be decreased. The obligation guarantees satisfaction of any U.S. administrative settlement agreement, administrative final order or judicial judgment against the operator arising from a violation of 18 U.S.C. 1001, 42 U.S.C. 7413(c)(2), or other applicable provisions of the Clean Air Act.

31 U.S. Code § 9305 governs the qualifications that a surety company must demonstrate in order to be acceptable to the government for federal obligations such as the TPEM bond. A surety corporation must file with the Secretary of the Treasury a copy of its articles of incorporation and a financial statement sworn to by the president and secretary of the insurer. Upon receipt of these the Secretary of the Treasury approves the surety company and adds it to the list of approved sureties, also known as the "T-List". Inclusion of the surety on the T-List is definitive evidence of a surety company's acceptability for all federal obligations. The EPA provides helpful information about the bonding requirements for Vehicle and Engine certifications here.

Surety One, Inc. is an international insurance insurance intermediary focused on the surety sector. There is no bond for which we do not have an appetite. If it is bondable and we can clearly understand the nature of the obligation, we will offer terms. Surety One, Inc.'s philosophy is to NEVER DECLINE A BOND. Our international surety clientele regularly needs surety capacity in the United States. We are pleased to offer access to those foreign entities just like we do for U.S. ones. Call (800) 373-2804, email or click here for a live chat regarding a TMEM bond (EPA surety bond) application or to discuss your particular needs.

Surety bond application review and quoting are free of charge. There is no obligation to purchase.

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