17 AAC 45.240. Agreement to complete construction or remediation

(a) If the department grants a lessee, permittee, or concessionaire a term or term extension for a land lease based on proposed construction or remediation on the premises, the lessee, permittee, or concessionaire must agree to complete the construction or remediation within the following periods:

(1) in the case of construction, the time that the department sets in the lease, permit, or concession; the time set will not exceed two years unless the lessee shows to the department's satisfaction that a longer period of time is required considering the cost, type, and phasing of construction and any required remediation under 17 AAC 45.225(b) (6) and that granting a longer period of time to complete the construction or remediation is not inconsistent with the best interest of the state; or

(2) in the case of remediation, the time set in a remediation plan that the lessee, permittee, or concessionaire submits under 17 AAC 45.225(b) (6) and that the department approves.

(b) The department will require a performance bond, deposit, personal guarantee, or other security if the department determines security is necessary or prudent to ensure completion of the construction or remediation within the time period set under (a) of this section. The department will determine the form and amount of the security considering the nature and scope of the construction or remediation and the financial responsibility of the lessee, permittee, or concessionaire.

(c) The lessee, permittee, or concessionaire shall, within 30 days after completion of construction or remediation, submit to the department written documentation that the construction or remediation has been completed as required.

(d) If the lessee shows good cause to the department and if it is not inconsistent with the best interest of the state, the department will grant an extension that is sufficient to allow for the completion of the construction or remediation or for submission of documentation that the construction or remediation has been completed under this section.

(e) If within the time required under (a) and (c) of this section or as the department has extended under (d) of this section, a lessee, permittee, or concessionaire fails to complete the construction or remediation or to submit documentation that the construction or remediation has been completed, the department will execute the forfeiture of the performance bond, deposit, personal guarantee, or other security posted by the lessee, permittee, or concessionaire to the extent necessary to reimburse the department for all costs and damages, including administrative and legal costs, arising from the failure to complete the construction or remediation and, as applicable,

(1) if one-third or less of the construction or remediation has been completed, initiate cancellation of the lease, permit, or concession;

(2) if at least two-thirds of the construction or remediation has been completed, reduce the term of the lease, permit, or concession to a period that is consistent with the portion of the construction timely completed;

(3) if more than one-third but less than two-thirds of the construction or remediation has been completed, apply the best interests of the state to take the action described in either (1) or (2) of this subsection.

(f) An action that the department takes under (e) of this section must be in writing and must state the reasons for the action taken.

History: Eff. 3/28/2002, Register 161

Authority: AS 02.15.020

AS 02.15.060

AS 02.15.090

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