Waste Tire Bonds – Serious but Simple : BLOG: What You Need to Know About Surety Bonds.

Vic Lance explains that surety bonds are gradually becoming a prevalent requirement for waste tire haulers in a number of states across the US. Professionals in the field have to provide a waste tire hauler bond as a part of obtaining an authorisation certificate to operate legally in their areas.

Legislators are including this security criterion in new bills with the purpose of ensuring that transporting waste tires is done in accordance with all applicable laws. Bonds serve as an extra layer of guarantee for authorities that waste tire transporting companies are following the necessary requirements in conducting their activities.

While bonding is a serious administrative process, it is a straightforward one. If you haven’t worked with surety bonds before, this guide will inform you about the most important aspects of bonding.

What constitutes a breach in waste tires hauling?

In case a waste tire transporter transgresses from their responsibilities under their authorisation terms, their right to operate can be revoked from the authority in charge.

Typical breaches or situations that can cause the revocation of a hauler’s authorsation or permit include:

Collection, transportation or disposal of waste tires and materials without the needed permit or advertising such services without a permit

Failure to keep or falsification of documentation related to tire transportation

Using waste tire facilities that are not allowed to work with such tires

Using unauthorsed vehicles to transport waste tires.

Such breaches can also lead to a surety bond claim on the hauler’s bond.

What is the role of surety bonds?

In practical terms, surety bonds are a contractual agreement between three parties. The waste tire hauling business is the principal that needs to get bondedhe, t state body requiring the bond is the oblige and the surety is the third party that underwrites the bond.

Surety bonds are required, so that authorities and clients get additional protection from haulers’ non-compliance. In this sense, they are a safety net that secures the application of relevant laws, as well as a high level of service for haulers’ customers.

In case a waste tire transporter breaches state statutes, a surety bond claim can be made on their bond. The bond amount, which is its maximum penal sum, can then be used to compensate harmed parties. All costs are then covered by the waste tire hauler, which means that bond claims are a serious financial threat and are to be avoided.

How does the bonding process work

Naturally, for waste tire haulers, the most important factor is how much the new bond requirement will cost them. The bond price, in fact, is only a percentage of the surety bond amount that is required by the state.

For example, California, Louisiana, Michigan, Iowa, Washington State and other states have imposed a $10,000 surety bond requirement for waste tire haulers. However, professionals don’t need to pay the whole amount. Instead, they only have to cover a small percentage of this amount. For haulers with solid finances, this can mean a bond cost of a few hundred dollars only.

How exactly is the bond price set? When you apply for a waste tire hauler bond, your surety provider will examine your personal and business finances. This includes personal credit score, business financials and assets and liquidity. The more solid your financial situation is, the smaller your bond cost will be, as the risk of getting you bonded will be lower.

The gradual implementation of a surety bond requirement for waste tire transporters across the U.S. aims to regulate and improve the industry by setting and enforcing clear standards for haulers’ operations.

What is your view on the waste tire hauler requirement? Has it been introduced in your state already? Please share your thoughts in the comments below.

Vic Lance is the founder and president of Lance Surety Bond Associates.

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