Call to Order and Roll Call
The December meeting of the Administrative Regulation Review Subcommittee was held on Tuesday, December 10, 2013, at 1:00 PM, in Room 149 of the Capitol Annex. Senator Ernie Harris, Chair, called the meeting to order, and the secretary called the roll.
Present were:
Members: Senator Ernie Harris, Co-Chair; Representative Johnny Bell, Co-Chair; Senators Joe Bowen, and Sara Beth Gregory; Representatives Robert R. Damron, Jimmie Lee, and Tommy Turner.
Guests: Becky Gilpatrick, Jacqueline Korengel, Kentucky Higher Education Assistance Authority; Travis Powell, Council on Post Secondary Education; Jennifer Jones, Christopher Tapia, Brian Thomas, Kentucky Retirement Systems; Michael Rodman, C. Lloyd Vest II, Board of Medical Licensure; Larry Disney, Jim Grawe, Kentucky Real Estate Appraisers Board; Timothy Owen, Michael West, Board of Interpreters for the Deaf and Hard of Hearing; Clint Quarles, Dr. Robert Stout, Department of Agriculture; Shawn Cecil, Tony Hatton, Aaron Keatley, Division of Waste Management; Kara Daniel, Department of Corrections; Lisa Lang, David Wickersham, Department of Education; Stephanie Brammer-Barnes, Diona Mullins, Stuart Owen, Connie Payne, Cabinet for Health and Family Services; David Leightty, Citizen.
LRC Staff: Donna Little, Emily Caudill, Sarah Amburgey, Carrie Klaber, Emily Harkenrider, Karen Howard, Laura Napier, and Betsy Cupp.
The Administrative Regulation Review Subcommittee met on Tuesday, December 10, 2013, and submits this report:
Administrative Regulations Reviewed by the Subcommittee:
KENTUCKY HIGHER EDUCATION ASSISTANCE AUTHORITY: Division of Student and Administrative Services: Commonwealth Merit Scholarship Program
11 KAR 15:020. Student eligibility report. Becky Gilpatrick, director, represented the authority.
COUNCIL ON POSTSECONDARY EDUCATION: Adult Education and Literacy
13 KAR 3:050. GED® eligibility requirements. Jacqueline Korengel, director, and Travis Powell, general counsel, represented the council.
A motion was made and seconded to approve the following amendments: to amend the RELATES TO; STATUTORY AUTHORITY; and NECESSITY, FUNCTION, AND CONFORMITY paragraphs; and Section 3 to comply with the drafting and formatting requirements of KRS Chapter 13A. Without objection, and with agreement of the agency, the amendments were approved.
GENERAL GOVERNMENT CABINET: Kentucky Board of Medical Licensure: Board
201 KAR 9:081. Disciplinary proceedings. Michael Rodman, executive director, and C. Lloyd Vest II, general counsel, represented the board.
A motion was made and seconded to approve the following amendments: to amend the RELATES TO; STATUTORY AUTHORITY; and NECESSITY, FUNCTION, AND CONFORMITY paragraphs; and Sections 1 and 9 to comply with the drafting and formatting requirements of KRS Chapter 13A. Without objection, and with agreement of the agency, the amendments were approved.
Kentucky Real Estate Appraisers Board: Board
201 KAR 30:315 & E. Renewal and reinstatement. Larry Disney, executive director, and Jim Grawe, assistant attorney general, represented the board.
In response to questions by Co-Chair Harris, Mr. Disney stated that initially, the board was unsure regarding how many applicants there would be. There was one (1) Kentucky company, and there were 119 out-of-state companies that would be affected by these fees. The complexities of banking law had increased the processing costs of these applications. Costs were lower than the maximum cap provided in the authorizing statute. Mr. Grawe stated that this administrative regulation established reinstatement and renewal requirements, with the actual fees established in another administrative regulation. Mr. Disney stated that the previous surety bond requirements had proven insufficient; therefore, the $300 recovery fund fee would be placed in a fund to ensure protection in cases of default.
In response to a question by Representative Damron, Mr. Disney stated that surety bonds were now more difficult to acquire, and this administrative regulation established provisions for renewal and reinstatement.
A motion was made and seconded to approve the following amendments: (1) to amend the RELATES TO and NECESSITY, FUNCTION, AND CONFORMITY paragraphs and Sections 1, 2, and 3 to comply with the drafting and formatting requirements of KRS Chapter 13A; and (2) to amend the material incorporated by reference to add information for applicants for reinstatement, including the fees required to comply with KRS Chapter 324A and this administrative regulation, which requires both applicants for renewal and for reinstatement to use the same renewal form. Without objection, and with agreement of the agency, the amendments were approved.
Board of Interpreters for the Deaf and Hard of Hearing: Board
201 KAR 39:040. Fees. Timothy Owens, chair, and Michael West, assistant attorney general, represented the board.
In response to questions by Co-Chair Harris, Mr. West stated that a temporary license was sometimes necessary if an applicant was in the process of completing requirements for ordinary licensure. Costs for the board had been rising, including the cost changed by the Division of Occupations and Professions, which had risen 146% since 2002.
A motion was made and seconded to approve the following amendments: to amend the RELATES TO and STATUTORY AUTHORITY paragraphs and Sections 1 through 5, to comply with the drafting and formatting requirements of KRS Chapter 13A. Without objection, and with agreement of the agency, the amendments were approved.
ENERGY AND ENVIRONMENT CABINET: Department for Environmental Protection: Division of Waste Management: Brownfield's Redevelopment
401 KAR 102:005. Definitions for 401 KAR Chapter 102. Shawn Cecil, environmental scientist IV; Tony Hatton, executive director; and Aaron Keatley, deputy commissioner, represented the department.
In response to a question by Senator Bowen, Mr. Hatton stated that brownfield size was based on property boundaries. These administrative regulations applied to specific properties and property owners.
A motion was made and seconded to approve the following amendments: to amend the NECESSITY, FUNCTION, AND CONFORMITY paragraph and Section 1 to comply with the drafting requirements of KRS Chapter 13A. Without objection, and with agreement of the agency, the amendments were approved.
401 KAR 102:010. Brownfield Redevelopment Program.
In response to a question by Co-Chair Harris, Mr. Keatley stated that the cost of the Brownfield Redevelopment Program was funded one-third from the General Fund, one third from the fee established in this administrative regulation, and one third from federal funds. This was a voluntary program. The $2,500 fee would cover some, but not all, of the actual application processing costs. Lowering the fee would require the division to also use general funds to cover the costs of application processing. Public comments expressed surprise that the fee was not higher. Mr. Hatton stated that the application processing procedure included a technical review, which cost approximately $740. For one (1) in ten (10) of the applications, a Phase One review was conducted as a “random audit.” The Phase One review cost approximately $4,000. There would also be ongoing expenses.
401 KAR 102:020. General requirements for a Property Management Plan for Brownfield Redevelopment Program.
JUSTICE AND PUBLIC SAFETY CABINET: Department of Corrections: Office of the Secretary
501 KAR 6:020 & E. Corrections policies and procedures. Kara Daniel, special assistant to the general counsel, represented the department.
A motion was made and seconded to approve the following amendments: to amend Section 1 and the material incorporated by reference to clarify provisions and comply with the drafting requirements of KRS Chapter 13A. Without objection, and with agreement of the agency, the amendments were approved.
EDUCATION AND WORKFORCE DEVELOPMENT CABINET: Department of Education: Kentucky Board of Education: Food Service Programs
702 KAR 6:101. Repeal of 702 KAR 6:100. Lisa Lang, assistant general counsel, and David Wickersham, assistant general counsel, represented the department.
CABINET FOR HEALTH AND FAMILY SERVICES: Office of Health Policy: State Health Plan
900 KAR 5:020 & E. State Health Plan for facilities and services. Diona Mullins, policy advisor, and Emily Parento, executive director, represented the cabinet.
Office of Inspector General: Division of Health Care: Health Services and Facilities
902 KAR 20:058. Operation and services; primary care center. Stephanie Brammer-Barnes, policy analyst, and Connie Payne, acting inspector general, represented the cabinet.
A motion was made and seconded to approve the following amendments: (1) to amend the RELATES TO paragraph to add citations; (2) to amend the NECESSITY, FUNCTION, AND CONFORMITY paragraph and Sections 1, 3, and 4 to comply with the drafting and formatting requirements of KRS Chapter 13A; and (3) to amend Section 3 to clarify requirements for the Quality Assurance Program. Without objection, and with agreement of the agency, the amendments were approved.
Department for Medicaid Services: Commissioner's Office: Division of Healthcare Facilities Management: Medicaid Services
907 KAR 1:180. Freestanding birth center services. Stuart Owen, regulation coordinator, represented the cabinet.
A motion was made and seconded to approve the following amendments: to amend Sections 1 and 6 to comply with the drafting and formatting requirements of KRS Chapter 13A. Without objection, and with agreement of the agency, the amendments were approved.
907 KAR 1:190. Payments for freestanding birth center services.
A motion was made and seconded to approve the following amendments: to amend the NECESSITY, FUNCTION, AND CONFORMITY paragraph and Sections 1 through 3 to comply with the drafting and formatting requirements of KRS Chapter 13A. Without objection, and with agreement of the agency, the amendments were approved.
The following administrative regulations were deferred to the January 13, 2014, meeting of the Subcommittee:
FINANCE AND ADMINISTRATION CABINET: Kentucky Retirement Systems: General Rules
105 KAR 1:140 & E. Employer's administrative duties. Jennifer Jones, assistant general counsel; Christopher Tapia, staff attorney; and Brian C. Thomas, general counsel, represented the systems. David Leightty, attorney, represented the Kentucky Fraternal Order of Police and appeared in opposition to this administrative regulation.
In response to questions by Co-Chair Harris, Mr. Thomas stated that the agency amendment deleted the prohibition to classify an employee as a temporary or probationary employee more than one (1) time. A statutory amendment would be required to amend requirements pertaining to spiking to allow overtime for emergency situations and for emergency-related agencies to remain immune to actuarial costs associated with the last five (5) years of employment prior to employee retirement.
Mr. Leightty stated that the Kentucky Fraternal Order of Police (FOP) was concerned that requirements for actuarial costs to be covered by an agency with employees who acquired overtime in the last five (5) years prior to retirement would be difficult to enforce and would potentially harm public safety. He stated that the statute did not intend for the requirement to apply to emergency situations and emergency-related agencies because the statute exempted “bona fide” compensation. Including emergency situations and emergency-related agencies was an unintended consequence, which the Kentucky FOP believed could be remedied by amending this administrative regulation to clarify the statutory intent. It would be nearly impossible to determine which employees intended to retire within five (5) years and, if it even was possible, it may constitute age discrimination to limit overtime for those employees. As a result, agencies would probably limit overtime for all employees. Such an amendment to exempt public emergencies and joint task force exercises would be more protective of public safety. The Kentucky FOP respectfully requested that the subcommittee find this administrative regulation deficient if such an amendment was not added.
In response to questions by Representative Damron, Mr. Thomas stated that the statutory spiking provisions did not affect individual employees, but agencies with employees who are retiring. The last employment agency of a retired person was required to pay actuarial costs to cover retirement liability, except for bona fide advancement or employment change. This requirement would help cover some of the pension fund’s unfunded liability. If a soon-to-retire employee changed jobs during the last five (5) years of employment, it was possible that an agency would be required to assume the costs incurred at the previous agency because the costs would be to the last employment agency. Ms. Jones stated that the systems would follow up with data regarding specific cases and actuarial cost estimates. Mr. Tapia explained that actual costs would vary greatly on a case-by-case basis using the formula. Representative Damron stated that he was uncomfortable allowing this administrative regulation to progress until the data was submitted. He stated that a few thousand dollars of overtime could create tens of thousands of dollars in actuarial obligation. Co-Chair Bell stated that he too would prefer that this administrative regulation be deferred until the fiscal impact information was reviewed by the Subcommittee.
In response to a question by Representative Lee, staff read the statutory definition for “bona fide” from KRS 61.598.
In response to a question by Senator Bowen, Mr. Leightty stated that, because overtime was paid at 150% of standard salary, the ten (10) percent threshold was easy to reach with even a single serious emergency.
In response to questions by Co-Chair Bell, Mr. Leightty stated that an employer may try to avoid these actuarial costs by not appropriately staffing for emergency and related situations. This could lead to a reduction of public safety. Mr. Leightty stated that, as a retiree, he was concerned about protecting the pension system, but believed that this administrative regulation would incentivize agencies to short staff crucial programs. Mr. Thomas stated that the term “bona fide” was defined by statute and did not include overtime. The definition only included professional advancement or a change in employment status. For this administrative regulation to include overtime, a statutory amendment would first be required.
A motion was made and seconded to approve the following amendments: (1) to delete Section 1(9)(b), which prohibited an employer in the County Employees Retirement System from classifying an employee as temporary or probationary more than one (1) time; and (2) to add Section 8(13), which stated than an employer who is required to pay the additional actuarial cost pursuant to KRS 61.598 shall be treated as a participating employer in the system to which the employer is required to pay the additional actuarial cost solely for purposes of making the required payment. Without objection, and with agreement of the agency, the amendments were approved.
In response to a question by Representative Lee, Mr. Thomas agreed to defer consideration of this administrative regulation as amended to the January 2014 meeting of the Subcommittee. Without objection, and with agreement of the agency, this administrative regulation as amended was deferred.
GENERAL GOVERNMENT CABINET: Department of Agriculture: Office of Consumer and Environmental Protection: Division of Environmental Services: Livestock
302 KAR 21:001. Definitions for 302 KAR Chapter 21. Clint Quarles, attorney, and Dr. Robert Stout, state veterinarian, represented the division.
In response to questions by Co-Chair Bell, Mr. Quarles stated that the subject matter committee staff review stated that these administrative regulations did not conform to KRS 257.196 because the standards were vague. However, these administrative regulations did conform because the statute required minimum, rather than comprehensive, standards. There were multiple techniques for the various practices authorized by these administrative regulations, and these administrative regulations did not characterize all possible techniques; however, the regulated community was always obligated by statute to use a technique that is the least traumatic for the animal involved.
In response to a question by Senator Gregory, Mr. Quarles stated that the division’s intent in the definition for “soring” was that a chemical agent used on an equine had to be intentionally used to create an abrasion. Senator Gregory expressed concern that the intent was not clearly elaborated in the definition. She requested an amendment to clarify that intentionality was a requirement. The division agreed to the amendment.
In response to questions by Co-Chair Bell, Mr. Quarles stated that the division had remained in open dialogue with all stakeholders during the promulgation process of these administrative regulations. While the division did not amend these administrative regulations in response to public comments, each comment was taken into consideration. The division did not feel the need to further define commonly used terms and believed that further specification would cause these administrative regulations to be in conflict with the statutory mandate for minimum standards. If more specification was needed in the future, the division was willing to amend these administrative regulations as needed after they had become effective. Mr. Quarles stated that the division was staffed by livestock experts who had no intention of overstepping appropriate rights of the agricultural industry. Co-Chair Bell stated that the standard of “sufficient to maintain” established in these administrative regulations seemed vague and difficult to enforce. Protecting the rights of farmers was paramount, and it was not in a farmer’s best interest to provide insufficient care to livestock.
In response to a question by Representative Lee, Mr. Quarles stated that these administrative regulations were results driven, and it was unnecessary to provide the specific requirements, which would vary on a case-by-case basis. The federal guidelines were fairly commensurate in terms of specificity.
In response to a question by Senator Bowen, Mr. Quarles stated that the agricultural industry was unanimous in support of these administrative regulations. Dr. Stout stated that these administrative regulations were developed minimally to ensure that the requirements were not overburdensome.
A motion was made and seconded to approve the following amendments: to amend the definition for “soring” to clarify that a chemical agent shall be applied intentionally to create an equine abrasion. Without objection, and with agreement of the agency, the amendments were approved.
In response to a question by Representative Damron, Dr. Stout stated that, while the commission needed to approve all substantive amendments, he did not consider Senator Gregory’s amendment to be substantive as it aligned with formatting to the USDA definition. He agreed to consult with the commission about the amendments to 302 KAR 21:001.
In response to a question by Representative Turner, Mr. Quarles agreed to defer consideration of these administrative regulations to the January 2014 meeting of the Subcommittee. Without objection, and with agreement of the agency, these administrative regulations were deferred.
302 KAR 21:020. General livestock and poultry provisions.
302 KAR 21:030. Beef cattle, bison, and veal specific provisions.
302 KAR 21:040. Dairy cattle specific provisions.
302 KAR 21:050. Equine specific provisions.
302 KAR 21:060. Swine specific provisions.
A motion was made and seconded to approve the following amendment: to add Section 3 to incorporate by reference the Pork Quality Assurance Guidelines. Without objection, and with agreement of the agency, the amendment was approved prior to the deferral.
302 KAR 21:070. Ovine, caprine, camelid and cervid specific provisions.
302 KAR 21:080. Poultry specific provisions.
Office of Agricultural Marketing and Product Promotion: Organic Agricultural Product Certification
302 KAR 40:010. Certification of organic production, processing, or handling operations.
EDUCATION AND WORKFORCE DEVELOPMENT CABINET: Department of Education: Kentucky Board of Education: Office of Learning Support Services
704 KAR 7:151. Repeal of 704 KAR 7:150.
The Subcommittee adjourned at 3:10 p.m. until January 13, 2014 at 1 p.m.