Annual Inflation Adjustments
For some program areas, cost estimates, which provide the basis for the amount of financial assurance required, must be increased annually to account for inflation. Programs requiring inflation adjustments include:
- Industrial and Hazardous Waste
- Municipal Solid Waste
- Underground Injection Control Wells
- Class A or B Petroleum-Substance Contaminated Soil Storage, Treatment, and Reuse Facilities
- Scrap Tire Sites
- Public Drinking Water Systems and Utilities
- Radioactive Material - Burial
- Radioactive Waste - Low Level Near-Surface Land Disposal
For these programs, the inflation adjustment must be made using an inflation factor derived from the most recent annual Implicit Price Deflator for Gross National Product published by the United States Department of Commerce for the most recently completed year. The preliminary and final inflation factors are generally available by the first week of February and April of each year, respectively. Once the cost estimate has been adjusted, then you must ensure that your financial assurance mechanism dollar amount sufficiently covers the revised cost estimate.
Since these cost estimates reflect inflation for the previous year, permits specifying cost estimates for a specific year (e.g. 2014 dollars) will generally be expressed as the dollar year for the previous year. For instance, cost estimates received in 2015 will be expressed as 2014 dollars. Inflation adjustments made in 2016 to reflect inflation for 2015 will change the cost estimates to 2015 dollars.
Topics Under this Category
Historical inflation factors for information when determining an increase in your amount of required financial assurance.