Notice, Movement of bees infested with
Varroa mites, 22.10 ARC 7979A 1991

Notice, Fork-type latch in kennels, 67.7(1)
ARC 7978A 1991

Filed Emergency, Movement of bees infested
with Varroa mites, 22.10 ARC 7980A 2013

ALL AGENCIES

Schedule for rule making 1984

Publication procedures 1985

Agency identification numbers 1988

CITATION OF ADMINISTRATIVE RULES 1983

ECONOMIC DEVELOPMENT, IOWA
DEPARTMENT OF[261]

Notice, Enterprise zones, 59.2, 59.3(3), 59.5(1),
59.7 to 59.10 ARC 7983A 1991

EDUCATION DEPARTMENT[281]

Notice, Nonschool team participation,
36.15(7) ARC 7977A 1993

ENVIRONMENTAL PROTECTION
COMMISSION[567]

NATURAL RESOURCES DEPARTMENT[561]"umbrella"

Amended Notice, Waste incinerators and
combustors, 22.1(2), 22.101(2), 23.1,
25.1(10) ARC 7994A 1993

HUMAN SERVICES DEPARTMENT[441]

Notice, FIP, RCA, and food stamps, 7.5(6),
11.1 to 11.5, 65.21 ARC 7965A 1994

Notice, FIP grant reduction, 40.27(5), 41.22(6)
ARC 7966A 1997

Notice, Emergency food assistance program,
73.4(3)"d"(2) ARC 7967A 1998

Notice, Elderly waiver program, 83.22(1)"b"
ARC 7968A 1998

Filed, Grants for homeless persons with mental
illness, 39.21, 39.23, 39.29 ARC 7969A 2019

Filed, Statewide average cost for nursing care,
75.15(2), 75.24(3) ARC 7970A 2020

Filed, HCBS MR and BI programs, 77.37(12),
77.39(10), 79.1, 83.67(9) ARC 7971A 2021

Filed, Home health agency policy; approval for
dental procedures; nonsedating antihistamines,
78.1(2), 78.4, 78.9, 78.28 ARC 7972A 2026

Filed, Managed care program, 88.1, 88.3, 88.4,
88.6, 88.10(1), 88.12, 88.41, 88.42(1),
88.46, 88.47(1), 88.48, 88.49, 88.51(3),
88.52 ARC 7973A 2029

Filed, Child abuse investigations, rescind ch 175,
division I ARC 7974A 2034

Filed, Child abuse assessment, 175.21 to 175.27,
175.31 to 175.33, 175.35 to 175.42
ARC 7975A 2035

NATURAL RESOURCE COMMISSION[571]

NATURAL RESOURCES DEPARTMENT[561]"umbrella"

Filed Emergency, Snowmobile fund for insurance,
28.13(2) ARC 7993A 2013

PROFESSIONAL LICENSURE DIVISION[645]

PUBLIC HEALTH DEPARTMENT[641]"umbrella"

Notice, Funeral directors, 100.9(1), 100.10(3),
100.11, 101.1(3), 101.2 to 101.7, 101.98,
101.101, 101.102, 101.103(2), 101.200,
101.212 to 101.215 ARC 7988A 1999

Notice, Social work examiners, 280.2 to 280.4,
280.8 ARC 7987A 2003

PUBLIC FUNDS--AVAILABILITY

Public Health Department[641]
Substance abuse 1990

PUBLIC HEALTH DEPARTMENT[641]

Notice of Public Funds Availability 1990

Notice Terminated, AIDS, 1.2(1) ARC 7989A 2004

Notice, Reportable diseases, 1.2(1) ARC 7990A 2004

Notice, Private sector drug-free workplace
testing, ch 12 ARC 7981A 2005

Filed Emergency, Private sector drug-free
workplace testing, ch 12 ARC 7982A 2014

PUBLIC HEARINGS

Summarized list 1986

RACING AND GAMING COMMISSION[491]

INSPECTIONS AND APPEALS DEPARTMENT[481]"umbrella"

Notice, Thoroughbred racing--Lasix, 10.6
ARC 7984A 2006

Filed Emergency, Thoroughbred racing--Lasix,
10.6 ARC 7985A 2018

REVENUE AND FINANCE DEPARTMENT[701]

Filed, Sales and use tax on machinery, equipment,
and computers, 15.3(3), 17.3, 17.14(2),
18.29(7), 18.45, 18.58 ARC 7991A 2042

Filed, Assessor appointments and reappointments,
123.9 ARC 7992A 2047

SUPREME COURT

Decisions summarized 2051

TRANSPORTATION DEPARTMENT[761]

Filed, Motor vehicle records--privacy protection,
415.3, 415.4 ARC 7964A 2047

Filed, Motor carriers--hazardous materials,
520.1(1) ARC 7976A 2048

USURY

Notice 2006

UTILITIES DIVISION[199]

COMMERCE DEPARTMENT[181]"umbrella"

Notice, Energy efficiency plans and
standards, 35.1 to 35.9 ARC 7986A 2006

It also contains Proclamations and Executive Orders of the Governor which are general and permanent in nature; Economic Impact Statements to proposed rules and filed emergency rules; Objections filed by Administrative Rules Review Committee, Governor or the Attorney General; and Delay by the Committee of the effective date of filed rules; Regulatory Flexibility Analyses and Agenda for monthly Administrative Rules Review Committee meetings. Other "materials deemed fitting and proper by the Administrative Rules Review Committee" include summaries of Public Hearings, Attorney General Opinions and Supreme Court Decisions.

The Bulletin may also contain Public Funds Interest Rates [12C.6]; Workers' Compensation Rate Filings [515A.6(7)]; Usury [535.2(3)"a"]; Agricultural Credit Corporation Maximum Loan Rates [535.12]; and Regional Banking--Notice of Application and Hearing [524.1905(2)].

PLEASE NOTE: Italics indicate new material added to existing rules; strike through letters indicate deleted material.

KATHLEEN K. BATES, Administrative Code Editor Telephone: (515)281-3355

ROSEMARY DRAKE, Assistant Editor (515)281-7252

First quarter July 1, 1997, to June 30, 1998 $237.00 plus $11.85 sales tax

Second quarter October 1, 1997, to June 30, 1998 $178.00 plus $8.90 sales tax

Third quarter January 1, 1998, to June 30, 1998 $118.00 plus $5.90 sales tax

Fourth quarter April 1, 1998, to June 30, 1998 $ 60.00 plus $3.00 sales tax

Single copies may be purchased for $17.50 plus $0.88 tax. Back issues may be purchased if the issues are available.

Prices for the Iowa Administrative Code and its Supplements are as follows:

Iowa Administrative Code - $1,086.00 plus $54.30 sales tax

(Price includes 22 volumes of rules and index, plus a one-year subscription to the Code Supplement and the Iowa Administrative Bulletin. Additional or replacement binders can be purchased for $10.55 plus $0.53 tax.)

Iowa Administrative Code Supplement - $382.00 plus $19.10 sales tax

(Subscription expires June 30, 1998)

All checks should be made payable to the Iowa State Printing Division. Send all inquiries and subscription orders to:

Customer Service Center

Department of General Services

Hoover State Office Building, Level A

Des Moines, IA 50319

Telephone: (515)242-5120

PRINTING SCHEDULE FOR IAB
ISSUE NUMBER	SUBMISSION DEADLINE	ISSUE DATE
19	Friday, February 20, 1998	March 11, 1998
20	Friday, March 6, 1998	March 25, 1998
21	Friday, March 20, 1998	April 8, 1998

PLEASE NOTE:

Rules will not be accepted after 12 o'clock noon on the Friday filing deadline days unless prior approval has been received from the Administrative Rules Coordinator's office.

If the filing deadline falls on a legal holiday, submissions made on the following Monday will be accepted.

TO: Administrative Rules Coordinators and Text Processors of State Agencies

FROM: Kathleen K. Bates, Iowa Administrative Code Editor

SUBJECT: Publication of Rules in Iowa Administrative Bulletin

The Administrative Code Division uses Interleaf 6 to publish the Iowa Administrative Bulletin and can import documents directly from most other word processing systems, including Ami Pro, Microsoft Word, Professional Write, Word for Windows (Word 7 or earlier), and WordPerfect.

1. To facilitate the processing of rule-making documents, we request a 3.5" High Density (not Double Density) IBM PC-compatible diskette of the rule making. Please indicate on each diskette the following information: agency name, file name, format used for exporting, and chapter(s) amended. Diskettes may be delivered to the Administrative Code Division, 4th Floor, Lucas State Office Building or included with the documents submitted to the Governor's Administrative Rules Coordinator.

2. Alternatively, if you have Internet E-mail access, you may send your document as an attachment to an E-mail message, addressed to both of the following:

bcarr@legis.state.ia.us

kbates@legis.state.ia.us

Please note that changes made prior to publication of the rule-making documents are reflected on the hard copy returned to agencies by the Governor's office; diskettes are returned unchanged.

Your cooperation helps us print the Bulletin more quickly and cost-effectively than was previously possible and is greatly appreciated.

The Administrative Rules Review Committee voted to request that Agencies comply with Iowa Code section 17A.4(1)"b" by allowing the opportunity for oral presentation (hearing) to be held at least twenty days after publication of Notice in the Iowa Administrative Bulletin.

ECONOMIC DEVELOPMENT, IOWA DEPARTMENT OF[261]
Enterprise zones, 59.2, 59.3(3)"a," 59.5(1), 59.7, 59.8(1), 59.9, 59.10 IAB 5/6/98 ARC 7983A	IDED Main Conference Room 200 E. Grand Ave. Des Moines, Iowa	May 27, 1998 1:30 p.m.
EDUCATION DEPARTMENT[281]
Nonschool team participation, 36.15(7) IAB 5/6/98 ARC 7977A	State Board Room Grimes State Office Bldg. Des Moines, Iowa	May 26, 1998 1 to 3 p.m.
ENVIRONMENTAL PROTECTION COMMISSION[567]
Waste incinerators and combustors, 22.1(2), 22.101(2), 23.1, 25.1(10) IAB 5/6/98 ARC 7994A	East Conference Room Air Quality Bureau 7900 Hickman Rd., Suite 1 Urbandale, Iowa	May 26, 1998 1 p.m.
GENERAL SERVICES DEPARTMENT[401]
Inventory guidelines for personal and real property, ch 10 IAB 4/22/98 ARC 7962A	Director's Conference Room Level A Hoover State Office Bldg. Des Moines, Iowa	May 13, 1998 8 a.m.
INSPECTIONS AND APPEALS DEPARTMENT[481]
Health care facilities--infection control, 57.11, 57.12(1), 58.10(8), 58.11(1), 59.12(11), 59.13(1), 62.9(2), 62.19, 63.9, 63.11(1), 65.9(2), 65.21(4) IAB 4/22/98 ARC 7954A	Director's Conference Room Second Floor Lucas State Office Bldg. Des Moines, Iowa	May 12, 1998 10 a.m.
PROFESSIONAL LICENSURE DIVISION[645]
Funeral directors, 100.9(1), 100.10(3), 100.11, 101.1(3), 101.2 to 101.7, 101.98, 101.101, 101.102, 101.103(2), 101.200, 101.212 to 101.215 IAB 5/6/98 ARC 7988A	Conference Room--4th Floor Side 1 Lucas State Office Bldg. Des Moines, Iowa	May 27, 1998 3:00 to 4:30 p.m.
Social work examiners, 280.2, 280.3, 280.4(1), 280.8 IAB 5/6/98 ARC 7987A	Conference Room--4th Floor Side 1 Lucas State Office Bldg. Des Moines, Iowa	May 27, 1998 9 to 11 a.m.
PUBLIC HEALTH DEPARTMENT[641]
Reportable diseases, 1.2(1)"a" IAB 5/6/98 ARC 7990A	Conference Room--3rd Floor Side 1 Lucas State Office Bldg. Des Moines, Iowa	May 27, 1998 10 a.m.
Approval of confirmatory laboratories for private sector drug-free workplace testing, ch 12 IAB 5/6/98 ARC 7981A	Conference Room--3rd Floor Lucas State Office Bldg. Des Moines, Iowa	May 27, 1998 1:30 p.m.
Child death review team, 90.10, 90.11 IAB 4/22/98 ARC 7960A	Conference Room--3rd Floor Side 1 Lucas State Office Bldg. Des Moines, Iowa	May 12, 1998 1 to 2 p.m.
RACING AND GAMING COMMISSION[491]
Thoroughbred racing--Lasix, 10.6 IAB 5/6/98 ARC 7984A	Suite B 717 E. Court Ave. Des Moines, Iowa	May 26, 1998 9 a.m.
UTILITIES DIVISION[199]
Energy efficiency plans and standards, 35.1 to 35.9 IAB 5/6/98 ARC 7986A	Utilities Board Hearing Room 350 Maple St. Des Moines, Iowa	June 18, 1998 10 a.m.

CITATION of Administrative Rules

The Iowa Administrative Code shall be cited as (agency identification number) IAC
(chapter, rule, subrule, lettered paragraph, or numbered subparagraph).

441 IAC 79 (Chapter)

441 IAC 79.1(249A) (Rule)

441 IAC 79.1(1) (Subrule)

441 IAC 79.1(1)"a" (Paragraph)

441 IAC 79.1(1)"a"(1) (Subparagraph)

The Iowa Administrative Bulletin shall be cited as IAB (volume), (number), (publication
date), (page number), (ARC number).

IAB Vol. XII, No. 23 (5/16/90) p. 2050, ARC 872A

"Umbrella" agencies and elected officials are set out below at the left-hand margin in CAPITAL letters.

Divisions (boards, commissions, etc.) are indented and set out in lowercase type under their statutory "umbrellas."

Other autonomous agencies which were not included in the original reorganization legislation as "umbrella" agencies are included alphabetically in small capitals at the left-hand margin, e.g., BEEF INDUSTRY COUNCIL, IOWA[101].

The following list will be updated as changes occur:

AGRICULTURE AND LAND STEWARDSHIP DEPARTMENT[21]

Agricultural Development Authority[25]

Soil Conservation Division[27]

ATTORNEY GENERAL[61]

AUDITOR OF STATE[81]

BEEF INDUSTRY COUNCIL, IOWA[101]

BLIND, DEPARTMENT FOR THE[111]

CITIZENS' AIDE[141]

CIVIL RIGHTS COMMISSION[161]

COMMERCE DEPARTMENT[181]

Alcoholic Beverages Division[185]

Banking Division[187]

Credit Union Division[189]

Insurance Division[191]

Professional Licensing and Regulation Division[193]

Accountancy Examining Board[193A]

Architectural Examining Board[193B]

Engineering and Land Surveying Examining Board[193C]

Landscape Architectural Examining Board[193D]

Real Estate Commission[193E]

Real Estate Appraiser Examining Board[193F]

Savings and Loan Division[197]

Utilities Division[199]

CORRECTIONS DEPARTMENT[201]

Parole Board[205]

CULTURAL AFFAIRS DEPARTMENT[221]

Arts Division[222]

Historical Division[223]

ECONOMIC DEVELOPMENT, IOWA DEPARTMENT OF[261]

City Development Board[263]

Iowa Finance Authority[265]

EDUCATION DEPARTMENT[281]

Educational Examiners Board[282]

College Student Aid Commission[283]

Higher Education Loan Authority[284]

Iowa Advance Funding Authority[285]

Libraries and Information Services Division[286]

Public Broadcasting Division[288]

School Budget Review Committee[289]

EGG COUNCIL[301]

ELDER AFFAIRS DEPARTMENT[321]

EMPLOYMENT SERVICES DEPARTMENT[341]

Job Service Division[345]

Labor Services Division[347]

ETHICS AND CAMPAIGN DISCLOSURE BOARD, IOWA[351]

EXECUTIVE COUNCIL[361]

FAIR BOARD[371]

GENERAL SERVICES DEPARTMENT[401]

HUMAN INVESTMENT COUNCIL[417]

HUMAN RIGHTS DEPARTMENT[421]

Community Action Agencies Division[427]

Criminal and Juvenile Justice Planning Division[428]

Deaf Services Division[429]

Persons With Disabilities Division[431]

Latino Affairs Division[433]

Status of Blacks Division[434]

Status of Women Division[435]

HUMAN SERVICES DEPARTMENT[441]

INSPECTIONS AND APPEALS DEPARTMENT[481]

Employment Appeal Board[486]

Foster Care Review Board[489]

Racing and Gaming Commission[491]

State Public Defender[493]

INTERNATIONAL NETWORK ON TRADE (INTERNET)[497]

LAW ENFORCEMENT ACADEMY[501]

LIVESTOCK HEALTH ADVISORY COUNCIL[521]

MANAGEMENT DEPARTMENT[541]

Appeal Board, State[543]

City Finance Committee[545]

County Finance Committee[547]

NARCOTICS ENFORCEMENT ADVISORY COUNCIL[551]

NATIONAL AND COMMUNITY SERVICE, IOWA COMMISSION ON[555]

NATURAL RESOURCES DEPARTMENT[561]

Energy and Geological Resources Division[565]

Environmental Protection Commission[567]

Natural Resource Commission[571]

Preserves, State Advisory Board[575]

PERSONNEL DEPARTMENT[581]

PETROLEUM UNDERGROUND STORAGE TANK FUND
BOARD, IOWA COMPREHENSIVE[591]

PREVENTION OF DISABILITIES POLICY COUNCIL[597]

PUBLIC DEFENSE DEPARTMENT[601]

Emergency Management Division[605]

Military Division[611]

PUBLIC EMPLOYMENT RELATIONS BOARD[621]

PUBLIC HEALTH DEPARTMENT[641]

Substance Abuse Commission[643]

Professional Licensure Division[645]

Dental Examiners Board[650]

Medical Examiners Board[653]

Nursing Board[655]

Pharmacy Examiners Board[657]

PUBLIC SAFETY DEPARTMENT[661]

RECORDS COMMISSION[671]

REGENTS BOARD[681]

Archaeologist[685]

REVENUE AND FINANCE DEPARTMENT[701]

Lottery Division[705]

SECRETARY OF STATE[721]

SEED CAPITAL CORPORATION, IOWA[727]

SESQUICENTENNIAL COMMISSION, IOWA STATEHOOD[731]

SHEEP AND WOOL PROMOTION BOARD, IOWA[741]

TELECOMMUNICATIONS AND TECHNOLOGY COMMISSION, IOWA[751]

TRANSPORTATION DEPARTMENT[761]

Railway Finance Authority[765]

TREASURER OF STATE[781]

UNIFORM STATE LAWS COMMISSION[791]

VETERANS AFFAIRS COMMISSION[801]

VETERINARY MEDICINE BOARD[811]

VOTER REGISTRATION COMMISSION[821]

WORKFORCE DEVELOPMENT DEPARTMENT[871]

Industrial Services Division[873]

Labor Services Division[875]

Workforce Development Board and
Workforce Development Center Administration Division[877]

Pursuant to the authority of Iowa Code section 160.9, the Iowa Department of Agriculture and Land Stewardship gives Notice of Intended Action to amend Chapter 22, "Apiary," Iowa Administrative Code.

This rule is intended to prohibit honeybees from being transported into Iowa from the state of Florida, which is known to be infested with Varroa mites that are resistant to fluvalinate miticide, the only product registered for the control of Varroa mites.

Any interested person may make written suggestions or comments on the proposed amendment prior to 4:30 p.m. on May 26, 1998. Such written material should be directed to Robert Cox, State Apiarist, Iowa Department of Agriculture and Land Stewardship, Wallace State Office Building, Des Moines, Iowa 50319.

This amendment is intended to implement Iowa Code section 160.9.

This amendment is also being simultaneously published herein under Adopted and Filed Emergency as ARC 7980A. The content of that submission is incorporated by reference.

ARC 7978A

Pursuant to the authority of Iowa Code sections 159.5(11) and 162.16, the Iowa Department of Agriculture and Land Stewardship gives Notice of Intended Action to amend Chapter 67, "Animal Welfare," Iowa Administrative Code.

This proposed amendment is intended to prevent the unintentional release of animals maintained in boarding kennels and commercial kennels by requiring that "fork-type" latches, or other latches which may allow the unintentional release of an animal, be secured. The Department received a letter from a citizen requesting this amendment. The citizen lost two pets due to a "fork-type" latch not being secured at a licensed facility.

Any interested person may make written suggestions or comments on the amendment prior to 4:30 p.m. on May 26, 1998. Such written material should be directed to Dr. John J. Schiltz, Assistant State Veterinarian, Iowa Department of Agriculture and Land Stewardship, Wallace State Office Building, Des Moines, Iowa 50319.

This amendment is intended to implement Iowa Code chapter 162.

The following amendment is proposed.

Amend subrule 67.7(1) by adding a new paragraph "f" as follows:

f. Primary enclosures shall utilize latches which cannot be inadvertently opened, or shall be equipped with some form of locking device so as to prevent the accidental release of the animal contained therein.

ARC 7983A

Pursuant to the authority of Iowa Code sections 15.104 and 15.106, the Iowa Department of Economic Development hereby gives Notice of Intended Action to amend Chapter 59, "Enterprise Zones," Iowa Administrative Code.

The proposed amendments (1) update references from the Iowa Acts to the Iowa Code Supplement; (2) add a new definition for "Project jobs"; (3) revise the definition of "Full-time" to include holidays, vacations, and other paid leave; (4) provide clarification of the requirement that a business is required to create at least ten project jobs and maintain them for ten years; (5) require the business to complete the capital investment within three years of the agreement effective date; (6) clarify that benefits are only available if the average wage of all project jobs meets the minimum wage standards for this program; (7) describe how "project completion date" is determined for purposes of claiming the refund for sales, service and use taxes paid to contractors and subcontractors; (8) indicate that the term of the agreement between the Department, business, and city/county is ten years from the agreement effective date rather than the application approval date; (9) remove a requirement that the wage levels are met as the jobs are created; and (10) permit the local enterprise commissions to determine whether a vacant building is suitable for industrial use for purposes of allowing a business that will occupy a vacant building a credit towards meeting the investment requirement.

Public comments concerning the proposed amendments will be accepted until 4:30 p.m. on May 27, 1998. Interested persons may submit written or oral comments by contacting Bob Henningsen, Business Development Division, Department of Economic Development, 200 East Grand Avenue, Des Moines, Iowa 50309; telephone (515)242-4725.

A public hearing to receive comments about the proposed amendments will be held on May 27, 1998, at 1:30 p.m. at the above address in the IDED Main Conference Room. Individuals interested in providing comments at the hearing should contact Bob Henningsen by 4 p.m. on May 26, 1998, to be placed on the hearing agenda.

These amendments are intended to implement Iowa Code Supplement sections 15E.191 through 15E.196.

The following amendments are proposed.

ITEM 1. Amend rule 261--59.2(15E) as follows:

Amend the following definitions:

"Act" means 1997 Iowa Acts, House File 724. Code Supplement sections 15E.191 through 15E.196.

"Created jobs" means the full-time jobs pledged by the business which pay an average wage that is at or greater than 90 percent of the lesser of the average county wage or average regional wage, as determined by the department. However, in any circumstance, the wage paid by the business shall not be less than $7.50 per hour.

"Full-time" or "full-time equivalent position" means the equivalent of employment of one person for 8 hours per day for a 5-day, 40-hour workweek for 52 weeks per year, including paid holidays, vacations and other paid leave.

Adopt the following new definition in alphabetical order:

"Project jobs" means all of the new jobs to be created by the location or expansion of the business in the enterprisezone. For the project jobs, the business shall pay an average wage that is at or greater than 90 percent of the lesser of the average county wage or average regional wage, as determined by the department. However, in any circumstance, the wage paid by the business for the project jobs shall not be less than $7.50 per hour.

ITEM 2. Amend subparagraph 59.3(3)"a"(1) as follows:

(1) Documentation that meets the distress criteria of Iowa Code Supplement section 15E.184. 15E.194.

ITEM 3. Amend subrule 59.5(1) as follows:

59.5(1) Requirements. A business which is or will be located in an enterprise zone is eligible to receive incentives and assistance under the Act if the business meets all of the following:

a. The business has not closed or reduced its operation in one area of the state and relocated substantially the same operation into the enterprise zone. This requirement does not prohibit a business from expanding its operation in an enterprise zone if existing operations of a similar nature in the state are not closed or substantially reduced.

b. The business is not a retail business.

c. The business pays at least 80 percent of the cost of a standard medical and dental insurance plan for all full-time employees working at the facility in which the new investment will occur.

d. The business pays an average wage that is at or greater than 90 percent of the lesser of the average county wage or average regional wage, as determined by the department. However, in any circumstance, the wage paid by the business for the project jobs shall not be less than $7.50 per hour. The department will periodically calculate, revise and issue the "average county wage" and the "average regional wage" figures that will be used for determining business eligibility in the program. However, in any circumstance, a company will be deemed eligible for participation in the enterprise zone if it pays an hourly wage of $9.50 or greater. The local enterprise zone commission may establish higher company eligibility wage thresholds if it so desires. These wage levels shall be met as each job is created at the business location.

e. The business creates at least ten full-time positions and maintains them for at least ten years expansion or location must result in at least 10 full-time project jobs and those project jobs must be maintained for at least ten years. The business shall create these jobs within three years of the effective date of the business's agreement with the department and the city or county, as appropriate. For an existing business in counties with a population of 10,000 or less, the commission may adopt a provision that allows the business to create at least five initial jobs with the additional five jobs to be added within five years. The business shall include in its strategic plan the time line for job creation. If the existing business fails to meet the ten-job creation requirement within the five-year period, all incentives and assistance will cease immediately.

f. The business makes a capital investment of at least $500,000. If the business will be occupying a vacant building suitable for industrial use, the fair market value of the building and land, not to exceed $250,000, as determined by the local enterprise zone commission, shall be counted toward the capital investment requirement. An existing business that has been operating in the enterprise zone for at least five years is exempt from the capital investment requirement of this paragraph of up to $250,000 of the fair market value, as established by an appraisal, of the building and land. The capital investment amount stated in the business's application must be completed within three years of the effective date of the agreement described in rule 59.9(15E).

ITEM 4. Amend subrule 59.7(1) as follows:

59.7(1) Compliance with the requirements of the Act and administrative rules. Each application will be reviewed to determine if it meets the requirements of Iowa Code Supplement section 15E.183 15E.193 and these rules. Specific criteria to be reviewed include, but are not limited to: medical and dental insurance coverage; wage levels; number of jobs to be created; and capital investment level.

ITEM 5. Amend subrule 59.7(4) as follows:

59.7(4) Violations of law. The department will review each application to determine if the business has a record of violations of law. If the department finds that an eligible business has a record of violations of the law including, but not limited to, environmental and worker safety statutes, rules, and regulations over a period of time that tends to show a consistent pattern, the eligible business shall not qualify for incentives or assistance under Iowa Code Supplement section 15E.186 15E.196, unless the department finds that the violations did not seriously affect public health or safety or the environment, or if they did that there were mitigating circumstances. If requested by the department, the business shall provide copies of materials documenting the type of violation, any fees or penalties assessed, court filings, final disposition of any findings and any other information which would assist the department in assessing the nature of any violation.

ITEM 6. Amend subrule 59.8(1) as follows:

Amend the introductory paragraph as follows:

59.8(1) Benefits. The following benefits are available to an eligible business within a certified enterprise zone only when the average wage of all the new project jobs meets the minimum wage requirements of 59.5(1)"d":

Amend subparagraph 59.8(1)"b"(1) as follows:

(1) The county or city for which an eligible enterprise zone is certified may exempt from all property taxation all or a portion of the value added to the property upon which an eligible business locates or expands in an enterprise zone and which is used in the operation of the eligible business. This exemption shall be authorized by the city or county that would have been entitled to receive the property taxes, but is electing to forego the tax revenue for an eligible business under this program. The amount of value added for purposes of Iowa Code Supplement section 15E.186 15E.196 shall be the amount of the increase in assessed valuation of the property following the location or expansion of the business in the enterprise zone.

Amend subparagraph 59.8(1)"e"(2) as follows:

(2) Taxes attributable to intangible property and furniture and furnishings shall not be refunded. To receive a refund of the sales, service and use taxes paid to contractors or subcontractors, the eligible business must, within six months after project completion, make an application to DRF. For new manufacturing facilities, "project completion" means the first date upon which the average annualized production of finished product for the preceding 90-day period at the manufacturing facility operated by the eligible business within the enterprise zone is at least 50 percent of the initial design capacity of the facility. For existing facilities, "project completion" means the date of completion of all improvements included in the enterprise zone project.

ITEM 7. Amend rule 261--59.9(15E) as follows:

261--59.9(15E) Agreement. The department and the city or county, as applicable, shall enter into agreement with the business. The term of the agreement shall be ten years from the date the business's application was approved by the department agreement effective date plus any additional time necessary for the business to satisfy the job maintenance requirement. This three-party agreement shall include, but is not limited to, provisions governing the number of jobs to be created, representations by the business that it will pay the wage and benefit levels pledged and meet the other requirements of the Act as described in the approved application, reporting requirements such as an annual certification by the business that it is in compliance with the Act, and the method for determining the amount of incentives or assistance paid which will be repaid in the event of failure to maintain the requirements of the Act and these rules. In addition, the agreement will specify that a business that fails to maintain the requirements of the Act and these rules shall not receive incentives or assistance for each year during which the business is not in compliance.

ITEM 8. Amend subrules 59.10(3) and 59.10(4) as follows:

59.10(3) Calculation of repayment due. If a business fails in any year to meet any one of the requirements of Iowa Code Supplement section 15E.183(1) 15E.193(1) and 261-- 59.5(15E) to be an eligible business, it is subject to repayment of all or a portion of the amount of incentives received.

a. Failure to meet/maintain requirements. If a business fails in any year to meet or maintain any one of the requirements of Iowa Code Supplement section 15E.183(1) 15E.193(1), except its job creation requirement which shall be calculated as outlined in paragraph "b" below, the business shall repay the value of the incentives received for each year during which it was not in compliance.

b. No change.

59.10(4) DRF; county/city recovery. Once it has been established, through the business's annual certification, monitoring, audit or otherwise, that the business is required to repay all or a portion of the incentives received, the department of revenue and finance and the city or county, as appropriate, shall collect the amount owed. The city or county, as applicable, shall have the authority to take action to recover the value of taxes not collected as a result of the exemption provided by the community to the business. The department of revenue and finance shall have the authority to recover the value of state taxes or incentives provided under Iowa Code Supplement section 15E.186 15E.196. The value of state incentives provided under Iowa Code Supplement section 15E.186 15E.196 includes applicable interest and penalties.

These rules are intended to implement 1997 Iowa Acts, House File 724 Iowa Code Supplement sections 15E.191 through 15E.196.

ARC 7977A

Pursuant to the authority of Iowa Code section 280.13, the Iowa State Board of Education hereby gives Notice of Intended Action to amend Chapter 36, "Extracurricular Interscholastic Competition," Iowa Administrative Code.

This amendment is being proposed to remove a particularly harsh consequence for violation of the subrule and to provide boards of education the authority and responsibility to address nonschool team participation through local board policy.

Interested parties may comment on the proposed amendment on or before May 26, 1998. Written materials should be directed to Dwight R. Carlson, Assistant to the Director, Department of Education, Grimes State Office Building, Des Moines, Iowa 50319-0146; telephone (515)281-3436.

A public hearing will be held on May 26, 1998, from 1 to 3 p.m. in the State Board Room, Grimes State Office Building, Des Moines, Iowa, at which persons may present their views orally and in writing.

This amendment is intended to implement Iowa Code section 280.13.

The following amendment is proposed.

Rescind subrule 36.15(7) and adopt in lieu thereof the following new subrule:

36.15(7) Nonschool team participation. The local school board shall by policy determine whether or not participation in nonschool athletic events during the same season is permitted and provide penalties for students who may be in violation of the board's policy.

ARC 7994A

ARC 7965A

Pursuant to the authority of Iowa Code sections 217.6 and 234.6 and Iowa Code Supplement section 239B.4(3), the Department of Human Services proposes to amend Chapter 7, "Appeals and Hearings," Chapter 11, "Overpayments," and Chapter 65, "Administration," appearing in the Iowa Administrative Code.

These amendments implement the use of three separate demand letters for the Family Investment Program (FIP), Refugee Cash Assistance (RCA), and food stamps; revise policy regarding the collection of food stamp agency error claims; and implement changes to the collection of food stamp claims mandated by federal law. In addition, references and form names and numbers are updated.

* Policy is revised to provide for the issuance of three food stamp demand letters for FIP, RCA, and food stamps instead of the current single form used for each program. Clients will receive a different demand letter for repayment depending on whether their overissuance was due to an agency error, client error, or intentional program violation. The use of three separate letters will be less confusing for participants and former participants. This change was made for food stamps in response to the Bliek lawsuit, and by making the same change for FIP and RCA, it will be less confusing to persons who have claims in multiple programs.

* Policy is revised to require the collection of agency error claims for overissued food stamps by benefit reduction for current recipients and by state tax refund offset or federal offset for households not participating in the program. Under current policy, if a client does not voluntarily make arrangements to repay an agency error claim, collection is not pursued after the issuance of four demand letters. Under revised policy, which is required by Section 844 of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, claims due to agency errors of active clients will be recouped in the same manner as inadvertent household error claims (10 percent reduction in benefit allotment), and agency errors of nonparticipating households will be referred for state or federal offset.

* Policy is clarified regarding repayment of claims. Payment shall be applied only to eligible overpayments. An eligible overpayment means any overpayment which is not under investigation or appeal. If there is more than one overpayment, payments shall be applied first to all overpayments with an agreement, in chronological order of discovery, and then to overpayments without an agreement, also in chronological order of discovery.

* Policy is revised regarding the order of repayment of claims for food stamps. For food stamps, payment shall also be applied first to all overpayments with an agreement and then to overpayments without an agreement. Within those two groupings, payment shall be applied first to state-only overpayments in chronological order of discovery, then to intentional program violation (IPV) overpayments in chronological order of discovery, then to inadvertent household error (IHE) overpayments in chronological order of discovery, and then to agency error overpayments in chronological order of discovery.

* Policy is revised to make state income tax offset optional as food stamp regulations require that the full amount of the debt cannot be referred for both federal and state offset. Benefit reduction shall be used for current recipients and either state tax offset or federal offset shall be used for households no longer participating in the program.

* Changes are made to the federal process for collection of food stamp claims mandated by the Debt Collection Improvement Act (DCIA) of 1996. Rules were previously adopted, but have not yet been implemented due to a stay in any collection activity by the Bliek lawsuit, to allow offset against federal income tax refunds, unemployment compensation, or other federal payments for food stamp program overpayments. Use of federal tax offset was optional, but is now mandatory. States have been given until January of 1999 to be up and running. Changes in the federal process are as follows:

[diamond] The Department of the Treasury is designated as the primary federal collection agent, rather than the Internal Revenue Service.

[diamond] Setoffs will not be made against unemployment compensation as the setoffs would not be cost-effective.

[diamond] Persons who are not participating in the food stamp program who are delinquent in repaying their food stamp overissuance shall be subject to collection action through the Treasury Offset Program (TOP) which includes, but is not limited to, federal tax refund offset, federal salary offset, and administrative offset.

Persons are delinquent in repaying their food stamp overissuance if a repayment agreement has not been signed and 180 days have elapsed since the date of the second demand letter minus any days the claim was not subject to collection action because of an appeal or because the claim was referred for court prosecution or a repayment agreement has been signed but the individual responsible for repaying the debt has failed to make the agreed-upon payments and has failed to make up the missed payments. The individual shall be referred to TOP when 180 days have elapsed since the first of the month following the month that the individual failed to make the agreed-upon payment and has not subsequently made up the missed payment.

The unpaid balance of the claims must exceed $25 and the claims must be more than three months and less than ten years old as of January 31 of the offset year. Claims which have had a final judgment entered are not subject to the ten-year time limit.

[diamond] The Department of the Treasury shall charge the individual for the cost of effecting the first offset and the Department for any other offsets.

[diamond] Individuals shall be notified 60 days prior to the time the Department refers the claim to TOP for offset to allow them to sign an agreement to repay, renegotiate an agreement, and pay off the delinquency. Clients may also request a review of the delinquent status of the claim from the Department of Inspections and Appeals (DIA) within the 60 days, and DIA shall determine if the claim is past due and legally enforceable and shall notify the individual in writing of the decision.

Consideration will be given to all written data, views, and arguments thereto received by the Bureau of Policy Analysis, Department of Human Services, Hoover State Office Building, Des Moines, Iowa 50319-0114, on or before May 27, 1998.

These amendments are intended to implement Iowa Code sections 217.34, 234.6, and 421.17, subsection 21, and Iowa Code chapter 239B.

The following amendments are proposed.

ITEM 1. Amend subrule 7.5(6) as follows:

7.5(6) Appeals of family investment program (FIP) and refugee cash assistance (RCA) overpayments. Subject to the time limitations described in subrule 7.5(4), a person's right to appeal the existence, computation, and amount of a FIP or RCA overpayment begins when the person receives the first Form 470-2616, Demand Letter for ADC/FIP FIP/RCA Agency Error Overissuance, Form 470-3489, Demand Letter for FIP/RCA Intentional Program Violation Overissuance, or Form 470-3490, Demand Letter for FIP/RCA Client Error Overissuance, from the department of human services, informing the person of the FIP or RCA overpayment. A hearing shall not be held if an appeal is filed in response to a second or subsequent Demand Letter for ADC/FIP FIP/RCA Agency Error Overissuance, Demand Letter for FIP/RCA Intentional Program Violation Overissuance, or Demand Letter for FIP/RCA Client Error Overissuance. Subject to the time limitations described in subrule 7.5(4), a person's right to appeal the recovery of an overpayment through benefit reduction, as described at rules rule 441--46.5(239) and 46.25(239) (239B), but not the existence, computation, or amount of an overpayment, begins when the person receives Form 470-0486, Notice of Decision, informing the person that benefits will be reduced to recover a FIP or RCA overpayment.

ITEM 2. Amend rule 441--11.1(217,421), definitions of "Debtor," "Public assistance," "Repayment agreement," and "Written notification," as follows:

"Debtor" shall mean a current or former recipient of public assistance (usually the head of the household) that has been determined by the department to be responsible for the repayment of a particular overpayment. For food stamps, "debtor" shall include all adult members of the food stamp household participating at the time the overpayment occurred.

"Public assistance" shall mean aid to families with dependent children family investment program, food stamps, medical assistance, state supplemental assistance, PROMISE JOBS, transitional child care, and refugee cash assistance.

"Repayment agreement" shall mean an agreement entered into voluntarily between the department and the debtor for the repayment of overpayment(s) overpayments.

Agreements shall be made on Form PA-3164-0 470-0495, Agreement to Repay Overpayment Repayment Contract, Form PA-3167-0, Agreement to Repay Overpayment after Probation, Form FP-2322-0 470-0338, Demand Letter for Food Stamp Agency Error Overissuance, Form 470-3486, Demand Letter for Food Stamp Intentional Program Violation Overissuance, Form 470-3487, Demand Letter for Food Stamp Inadvertent Household Error Overissuance, Form 470-2616, Demand Letter for ADC FIP/RCA Agency Error Overissuance, Form 470-3489, Demand Letter for FIP/RCA Intentional Program Violation Overissuance, Form 470-3490, Demand Letter for FIP/RCA Client Error Overissuance, and Form 470-2891, Demand Letter for Medicaid or State Supplementary Assistance Overpayment.

"Written notification" shall refer to the written notification sent to a current or former recipient of public assistance by the department on Form PA-3168-0 470-1668, "Pre-Debt Setoff Letter" Notice of Setoff of an Iowa Income Tax Refund for Debts Owed the Department of Human Services, Form 427-0538, Notice of Income Offset Against State Warrants for Debts Owed the Department of Human Services, and PA-3169-0, "Debt Setoff Letter" Form 427-0539, Notice of Income (Payroll) Offset Against State Warrants for Debts Owed the Department of Human Services.

Further amend rule 441--11.1(217,421) by adding the following new definition in alphabetical order:

"Eligible overpayment" means any overpayment which is not under investigation or appeal.

ITEM 3. Amend rule 441--11.2(217,421), introductory paragraph and subrule 11.2(1), as follows:

441--11.2(217,421) Accounts. The department shall maintain an account for each overpayment that has occurred for each debtor. The account shall contain the following:

11.2(1) Debtor A debtor name and account number.

ITEM 4. Amend subrules 11.3(1) and 11.3(2) as follows:

11.3(1) Application of payment to single program area. Payment shall be applied only to eligible overpayments. If there is more than one eligible overpayment in a program, the payment shall be applied first to the overpayment which was established first. Any remaining amount shall be applied to the next overpayment(s) all overpayments which have an agreement in chronological order of discovery and then to overpayments which do not have an agreement in chronological order of discovery until all overpayments have been paid in full or the full payment amount has been exhausted.

For food stamps, payment shall also be applied first to all overpayments with an agreement and then to overpayments without an agreement. Within those two groupings, payment shall be applied first to state-only overpayments in chronological order of discovery, then to intentional program violation (IPV) overpayments in chronological order of discovery, then to inadvertent household error (IHE) overpayments in chronological order of discovery, and then to agency error overpayments in chronological order of discovery.

11.3(2) Application of payment to multiple program areas. If there are overpayments in more than one program area of public assistance, payments received shall be applied to those program areas as indicated by the mode of repayment (food stamp coupons, ADC FIP benefits) or as indicated by the client at the time of payment.

ITEM 5. Amend rule 441--11.4(217,421) as follows:

Amend subrule 11.4(1), paragraph "a," introductory paragraph, as follows:

a. A claim against a debtor will may be made by the department for public assistance overpayments when:

Amend subrules 11.4(3) and 11.4(4), introductory paragraphs, as follows:

11.4(3) Pre-setoff notice. The department shall mail a Pre-Debt Setoff Letter, Form PA-3168-0, written notification to a debtor to inform the debtor of the amount the department intends to claim and apply to overpayment(s) overpayments in each program when:

11.4(4) Method for division of joint payments. When either spouse wishes to request a division of a jointly or commonly owned right to payment, a written request shall be submitted to the department within 15 days after the Pre-Debt Setoff Letter, Form PA-3168-0 written notification is mailed. When the request is received within the 15-day limit, the spouse's proportionate share of a jointly or commonly owned right to payment, as determined by the department of revenue and finance, shall be released by the department of revenue and finance unless:

Amend subrules 11.4(5), 11.4(6), and 11.4(7) as follows:

11.4(5) Appeal rights. When a debtor wishes to contest the claim of the department, a written request shall be submitted to the department within 15 days after the Pre-Debt Setoff Letter, Form PA-3168-0 written notification is mailed. When the request is received within the 15-day limit, a hearing shall be granted pursuant to rules in 441--Chapter 7.

If the department is upheld in the final decision, the setoff process shall continue and the refund, rebate, or other state payment shall be applied to the appropriate delinquent overpayment(s) overpayments. If the department is reversed in the final decision, the debtor's refund, rebate, or other state payment shall be released to the debtor by the department of revenue and finance.

11.4(6) Debt setoff. If the department has not received a request for an appeal hearing or a request for division of a jointly or commonly owned right to payment within 15 days after the date the Pre-Debt Setoff Letter, Form PA-3168-0 written notification is mailed, the department shall notify a debtor of the final decision by mailing the Debt Setoff Credit Letter, Form PA-3169-0 470-1667 to the debtor.

11.4(7) Application of setoff. The department shall apply any setoff received from the department of revenue and finance as a result of this rule to the debtor's overpayment(s) overpayments as indicated on the Pre-Debt Setoff Letter, Form PA-3168-0, written notification mailed to the debtor and in accordance with rule 441--11.3(217,421).

ITEM 6. Amend rule 441--11.5(234) as follows:

441--11.5(234) Setoff against federal income tax refund, unemployment compensation, or other federal payments, including, for example, federal employee wages.

11.5(1) Criteria for setoff.

a. A claim against a debtor shall be made by the department for food stamp program overpayments when: Individuals not participating in the food stamp program shall be subject to collection action through the treasury offset program (TOP) which includes, but is not limited to, federal salary offset and federal tax refund offset. Individuals shall be referred to TOP if they are delinquent in repaying their food stamp overissuance and there is a claim or combination of claims with an unpaid balance which exceeds $25. No claim which is less than three months old or more than ten years old as of January 31 of the offset year shall be referred. Exception: Claims which have had a final judgment entered are not subject to the ten-year time limit.

Individuals are delinquent in repaying their food stamp overissuance if:

(1) A debtor has failed to negotiate a repayment agreement, or A repayment agreement has not been signed and 180 days have elapsed since the date of the second demand letter minus any days the claim was not subject to collection action because of an appeal or because the claim was referred for court prosecution.

(2) A repayment agreement is not current, and A repayment agreement has been signed but the individual responsible for repaying the debt has failed to make the agreed-upon payments and has failed to make up the missed payments. The individual shall be referred to TOP when 180 days have elapsed since the first of the month following the month that the individual failed to make the agreed-upon payment and has not subsequently made up the missed payment.

(3) The cumulative balance of the applicable overpayments in subparagraphs (1) and (2) exceeds $50.

b. A claim against a debtor an individual will not be made referred to TOP by the department of inspections and appeals (DIA) for overpayments when:

(1) The overpayment is under investigation for fraud or is in an appeal status, or

(2) The overpayment is being recovered through grant or benefit reduction.

11.5(2) Setoff against federal income tax refund under TOP. The department DIA shall, by October December 1 of each year, submit a notification of liability for delinquent claims to the Internal Revenue Service Department of the Treasury.

11.5(3) Pre-setoff notice. The department DIA shall mail a pre-setoff notice Form 470-3488, Treasury Offset Program (TOP) 60-Day Notice to a debtor to inform the debtor of identifying the amount the department intends to claim and apply to overpayments in the food stamp program when the department is notified by the Internal Revenue Service that the debtor is entitled to a federal income tax refund or other federal payment refer to TOP for offset.

11.5(4) Warrant offset. The department shall mail a warrant offset notice to a debtor to inform the debtor of the amount the department intends to claim and apply to overpayments in the food stamp program when the department makes claim against the debtor's unemployment compensation or other federal payment. Offset fee. For each year the Treasury Department effects an offset against an individual referred to TOP, Treasury will charge the individual for one offset.

11.5(5) Appeal rights. When a debtor an individual wishes to contest the delinquent status of a claim of the department as identified by DIA, a written request shall be submitted to the department DIA within 15 60 days after of the date of the pre-setoff pre-offset notice or warrant notice is mailed. When the request is received within the 15-day 60-day limit, a hearing review shall be granted pursuant to rules in 441--Chapter 7.

If the department is upheld in the final decision, the setoff process shall continue and the refund, unemployment compensation, or other federal payment shall be released to the debtor by the Internal Revenue Service. DIA shall determine if the claim is past due and legally enforceable and shall notify the individual in writing of the decision.

11.5(6) Application of setoff. The department DIA shall apply any setoff received as a result of this rule to the debtor's individual's food stamp overpayments.

Any amount remaining after the setoff shall be released back to the debtor individual.

ITEM 7. Amend rule 441--65.21(234) as follows:

Amend subrule 65.21(1) as follows:

65.21(1) Time period. Claims Inadvertent household error and agency error claims shall be calculated back to the month the error originally occurred to a maximum of three years prior to month of discovery of the overissuance.

Rescind and reserve subrule 65.21(2).

Amend subrule 65.21(4) as follows:

65.21(4) Demand letters. Households which have inadvertent household error (IHE) food stamp claims shall return the repayment agreement no later than 20 days after the date the demand letter is mailed. Households which have intentional program violation (IPV) claims shall return the repayment agreement no later than ten days after the date the first demand letter is mailed. For agency error and inadvertent household error, IHE households which do not return the repayment agreement by the due date or do not timely request an appeal, allotment reduction shall occur with the first allotment issued after the expiration on the Notice of Adverse Action time period. For intentional program violation, IPV households which do not return the repayment agreement by the due date, allotment reduction shall occur with the first next month's allotment issued ten days after the date of the demand letter.

Further amend rule 441--65.21(234) by adding the following new subrule 65.21(6):

65.21(6) Collection of claims. All claims for overissued food stamps can be collected by allotment reduction. Individuals not participating in the food stamp program who are 180 days delinquent in repaying their overissuance will be subject to collection action through the treasury offset program (TOP) which includes, but is not limited to, federal salary offset and federal tax refund offset as outlined in rule 441--11.5(234).

ARC 7966A

Pursuant to the authority of Iowa Code Supplement section 239B.4(3), the Department of Human Services proposes to amend Chapter 40, "Application for Aid," and Chapter 41, "Granting Assistance," appearing in the Iowa Administrative Code.

These amendments provide that a family's 25 percent FIP grant reduction for noncooperation with child support recovery requirements shall be lifted beginning with the month after the parent or other caretaker expresses willingness to cooperate. However, the action to remove the grant reduction will still be delayed until cooperation has actually occurred. These changes will provide consistency with Medicaid rules on lifting a CSRU sanction.

Under current rules, if the parent or other caretaker fails to cooperate with the income maintenance (IM) unit, the FIP grant reduction is lifted effective the first of the next calendar month after cooperation has occurred. For example, if the client cooperates on April 12, the grant reduction is removed beginning with the May FIP grant.

However, if the noncooperation was with the child support recovery unit (CSRU), the grant reduction is lifted effective the first of the next calendar month after IM is notified by CSRU that cooperation has occurred. For example, if IM is notified on April 20 that the client cooperated on March 29, the grant reduction is lifted beginning with the May FIP grant.

Under these amendments, the grant reduction is lifted effective the first of the next calendar month after the client expressed willingness to cooperate.

EXAMPLE 1: If the previously noncooperating client expresses willingness to cooperate on March 29, and on April 20 CSRU notifies IM that the client carried out the cooperation requirements on April 18, the grant reduction is lifted retroactive beginning with the April FIP grant.

EXAMPLE 2: If the client expresses willingness to cooperate on April 1, and on April 25 CSRU notifies IM that the client complied with cooperation requirements on April 15, the grant reduction is lifted beginning with the May FIP grant.

Under these amendments, regardless of the date that the client may express willingness to cooperate, any action to lift the grant reduction is still delayed until the client has actually cooperated with IM, or until IM is notified by CSRU that the client has cooperated.

Consideration will be given to all written data, views, and arguments thereto received by the Bureau of Policy Analysis, Department of Human Services, Hoover State Office Building, Des Moines, Iowa 50319-0114, on or before May 27, 1998.

These amendments are intended to implement Iowa Code section 239B.2(6).

The following amendments are proposed.

ITEM 1. Amend subrule 40.27(5) as follows:

Amend paragraph "i" as follows:

i. When a sanction under paragraph 41.22(6)"f" or 441--subrule 41.25(8) is implemented or removed, the change shall be effective the first of the next calendar month after the change has occurred or notification as described in these rules that subrule has been received.

Further amend subrule 40.27(5) by adding the following new paragraph "j":

j. When a sanction under 441--paragraph 41.22(6)"f" is implemented, the change shall be effective the first of the next calendar month after the change has occurred when income maintenance determines noncooperation or after income maintenance receives notification from the child support recovery unit (CSRU) when CSRU determines noncooperation. When the sanction is removed, the change shall be effective the first of the next calendar month after the recipient has expressed willingness to cooperate as described in 441--paragraph 41.22(6)"f." However, action to remove the sanction shall be delayed until cooperation has actually occurred or until notification has been received from CSRU that the client has cooperated.

ITEM 2. Amend subrule 41.22(6), paragraph "f," as follows:

f. Failure to cooperate shall result in a sanction to the family. The sanction shall be a deduction of 25 percent from the net cash assistance grant amount payable to the family prior to any deduction for recoupment of a prior overpayment. When the income maintenance unit determines noncooperation, the sanction shall be implemented after the noncooperation has occurred. The sanction shall remain in effect until the client has cooperated expressed willingness to cooperate. However, any action to remove the sanction shall be delayed until cooperation has occurred. When the child support recovery unit (CSRU) makes the determination, the sanction shall be implemented upon notification from CSRU to the income maintenance unit that the client has failed to cooperate. The sanction shall remain in effect until the income maintenance unit is notified by CSRU that client has cooperated expressed to either income maintenance or CSRU staff willingness to cooperate. However, any action to remove the sanction shall be delayed until income maintenance is notified by CSRU that the client has cooperated. When the family is also subject to sanction under paragraph 41.25(8)"g," the sanction for failure to cooperate in obtaining support shall be calculated as though the sanction at paragraph 41.25(8)"g" does not exist.

ARC 7967A

Pursuant to the authority of Iowa Code section 234.6, the Department of Human Services proposes to amend Chapter 73, "Commodity Distribution Programs," appearing in the Iowa Administrative Code.

This amendment increases the income eligibility guidelines for the Emergency Food Assistance Program.

Income eligibility guidelines for the Emergency Food Assistance Program in Iowa are based on the income guidelines for the reduced price meals in the National School Lunch Program. These guidelines are set at 185 percent of the federal poverty guidelines and are normally revised effective July 1 of each year. Revised federal poverty guidelines have been received.

Consideration will be given to all written data, views, and arguments thereto received by the Bureau of Policy Analysis, Department of Human Services, Hoover State Office Building, Des Moines, Iowa 50319-0114, on or before May 27, 1998.

This amendment is intended to implement Iowa Code section 234.12.

The following amendment is proposed.

Amend subrule 73.4(3), paragraph "d," subparagraph (2), as follows:

(2) Income eligible status. The gross income according to family size is no more than the following amounts:

Household Size	Yearly Income		Monthly Income		Weekly Income
1	$14,597 $14,893		$1,217 $1,242		$ 281 $ 287
2	19,629 20,073		1,636 1,673		378 387
3	24,661 25,253		2,056 2,105		475 486
4	29,693 30,433		2,475 2,537		572 586
5	34,725 35,613		2,894 2,968		668 685
6	39,757 40,793		3,314 3,400		765 785
7	44,789 45,973		3,733 3,832		862 885
8	49,821 51,153		4,152 4,263		959 984
For each additional household member add:	$ 5,032 $ 5,180		$ 420 $ 432		$ 97 $ 100

ARC 7968A

Pursuant to the authority of Iowa Code section 249A.4, the Department of Human Services proposes to amend Chapter 83, "Medicaid Waiver Services," appearing in the Iowa Administrative Code.

This amendment adds five counties, Adams, Humboldt, Lyon, Mahaska, and Monroe, to the Elderly Waiver program effective October 1, 1998. With this addition, only five counties remain without the Elderly Waiver program: Audubon, Henry, Shelby, Sioux, and Taylor.

Consideration will be given to all written data, views, andarguments thereto received by the Bureau of Policy Analysis, Department of Human Services, Hoover State Office Building, Des Moines, Iowa 50319-0114, on or before May 27, 1998.

This amendment is intended to implement Iowa Code section 249A.4.

The following amendment is proposed.

Amend subrule 83.22(1), paragraph "b," as follows:

b. A resident of one of the following counties:

Adair	Davis	Jefferson	Plymouth
Adams	Decatur	Johnson	Pocahontas
Allamakee	Delaware	Jones	Polk
Appanoose	Des Moines	Keokuk	Pottawattamie
Benton	Dickinson	Kossuth	Poweshiek
Black Hawk	Dubuque	Lee	Ringgold
Boone	Emmet	Linn	Sac
Bremer	Fayette	Louisa	Scott
Buchanan	Floyd	Lucas	Story
Buena Vista	Franklin	Lyon	Tama
Butler	Fremont	Madison	Union
Calhoun	Greene	Mahaska	Van Buren
Carroll	Grundy	Marion	Wapello
Cass	Guthrie	Marshall	Warren
Cedar	Hamilton	Mills	Washington
Cerro Gordo	Hancock	Mitchell	Wayne
Cherokee	Hardin	Monona	Webster
Chickasaw	Harrison	Monroe	Winnebago
Clarke	Howard	Montgomery	Winneshiek
Clay	Humboldt	Muscatine	Woodbury
Clayton	Ida	O'Brien	Worth
Clinton	Iowa	Osceola	Wright
Crawford	Jackson	Page
Dallas	Jasper	Palo Alto

ARC 7988A

Pursuant to the authority of Iowa Code section 147.76, the Board of Mortuary Science Examiners hereby gives Notice of Intended Action to amend Chapter 100, "Funeral Directors," and Chapter 101, "Board of Mortuary Science Examiners," Iowa Administrative Code.

The proposed amendments revise licensing, renewal and continuing education requirements. Fees are established or adjusted for establishment renewals, returned checks, and reinstatement of a funeral director's license. The date of renewing a license is changed to the licensee's birth month.

Any interested person may make written suggestions or comments on the proposed amendments prior to May 27, 1998. Such written materials should be directed to Marge Bledsoe, Professional Licensure, Iowa Department of Public Health, Lucas State Office Building, Des Moines, Iowa 50319-0075; fax (515)281-3121; E-mail: mbledsoe@ idph.state.ia.us.

There will be a public hearing on May 27, 1998, from 3:00 to 4:30 p.m., in the Fourth Floor Conference Room, Side 1, Lucas State Office Building, Des Moines, Iowa, at which time persons may present their views either orally or in writing. At the hearing, persons will be asked to give their names and addresses for the record and to confine their remarks to the subject of the amendments.

These amendments are intended to implement Iowa Code chapters 135, 142, 144, 147, 156, and 272C.

The following amendments are proposed.

ITEM 1. Amend subrule 100.9(1) as follows:

100.9(1) Funeral establishment or cremation establishment license, or both. Any person or any corporation, partnership, joint venture, voluntary organization or any other entity doing business in this state may erect, maintain, and operate a funeral establishment or cremation establishment, or both, provided the necessary appliances and facilities for the care, preparation and disposition of human remains are in place. An establishment license must be obtained and maintained. The establishment license is not transferable.

ITEM 2. Amend subrule 100.10(3) as follows:

100.10(3) Renewal fees shall be received by the board on or before the end of the first month of the renewal period. Whenever renewal fees are not received as specified, the license lapses. In addition thereto a penalty fee of $50 shall be assessed. $5 shall be paid for each and every day the establishment remains delinquent. Delinquent days will be based on the postmark on the renewal envelope.

A licensee who allows an establishment license to lapse by failing to renew it within 60 days of renewal date may apply for reinstatement as follows:

1. Submit a completed application for reinstatement of a license for an establishment.

2. Pay the renewal fee(s), penalty fee(s) and reinstatement fee.

ITEM 3. Amend paragraph 100.11(4)"b" as follows:

b. If the authorizing person is not available to execute the cremation authorization form in person, that person the authorizing person may execute that authority the authorization form to another in writing, facsimile transmission, or telegram.

ITEM 4. Amend paragraph 100.11(5)"b" as follows:

b. No crematory shall cremate human remains when it has actual knowledge that the human remains contain a pacemaker, have been subjected to nuclear therapy, or have any other implants or materials which will present a health hazard to those performing the cremation and processing and pulverizing the cremated remains.

ITEM 5. Amend paragraph 100.11(5)"f" as follows:

f. Under no circumstances shall an alternative container or casket be opened at the cremation establishment except for verification to verify identity, to facilitate proper cremation, or to confirm that no health-hazard implants or materials are present.

ITEM 6. Amend paragraphs 101.1(3)"a" and 101.1(3)"b" as follows:

a. A minimum of 60 semester hours as indicated on the transcript in from a regionally accredited college or university with a minimum of a 2.0 or "C" grade point average. The 60 semester hours shall not include any technical mortuary science courses; and

b. A course in mortuary science from a school accredited by the American Board of Funeral Service Education.

The 60 semester hours shall not include any technical or vocational mortuary science courses.

ITEM 7. Amend rule 645--101.2(147,156), catchwords, and subrules 101.2(1) and 101.2(2) as follows:

645--101.2(147,156) Examinations. Requirements for licensure.

101.2(1) All applications for examination licensure must be made upon the official forms supplied by the Department of Public Health, Lucas Building, Des Moines, Iowa 50319-0075.

101.2(2) These completed applications shall be filed with the department of public health, together with satisfactory evidence of completion of the educational requirements. The examination application fee must be enclosed with the application, and the fee and application must be filed with the department of public health before beginning the internship.

ITEM 8. Rescind and reserve subrule 101.2(4).

ITEM 9. Amend subrule 101.2(5), introductory paragraph and paragraphs "a" and "b," as follows:

101.2(5) The embalming and funeral directing examination shall consist of three sections.

a. The board of mortuary science examiners shall accept a certificate of examination issued by the National International Conference of Funeral Service Examining Boards, Inc. indicating a passing score for the written and oral sections of the examination as prescribed at Iowa Code sections 156.4(4) and 156.13.

b. Applicants will be required to pass an examination covering the Iowa law and rules for mortuary science board rules and state laws prior to being licensed in Iowa. A 75 percent score shall be required for passing of this examination.

ITEM 10. Rescind and reserve paragraph 101.2(5)"c."

ITEM 11. Amend subrule 101.2(10) as follows:

101.2(10) An applicant detected seeking or giving help during the hours of examination will be dismissed and the applicant's papers canceled, but the applicant will be entitled to return for examination within 14 after 12 months from the examination date.

ITEM 12. Rescind subrule 101.2(11) and adopt the following new subrule in lieu thereof:

101.2(11) Applications for licensure shall be retained by the board office for two years from the date the application was received. To keep the application active beyond two years, the applicant must submit a written request to the board 60 days prior to expiration.

ITEM 13. Adopt new subrule 101.2(12) as follows:

101.2(12) License renewal. Beginning July 1, 1999, a license to practice as a funeral director shall expire every two years on the fifteenth day of the licensee's birth month. Continuing education requirements shall be completed within the same renewal period for each license holder. An application and a continuing education report form for renewal of license to practice as a funeral director shall be mailed to the licensee at least 60 days prior to the expiration of the license. Failure to receive the renewal application shall not relieve the license holder of the obligation to pay biennial renewal fees on or before the renewal date.

ITEM 14. Adopt new subrule 101.2(13) as follows:

101.2(13) Beginning July 1, 1999, the continuing education requirements will coincide with the renewal compliance period. The licensee shall submit to the board office 30 days before licensure expiration the application and continuing education report form with the renewal fee as specified in rule 101.98(147). Licensees who were issued their initial license within six months of their birth month will not be required to renew their license until the fifteenth day of their birth month two years later.

The new licensee is exempt from meeting the continuing education requirement for the continuing education biennium in which the license was originally issued. Licensees will be required to report 24 hours of continuing education for every renewal thereafter.

ITEM 15. Adopt new subrule 101.2(14) as follows:

101.2(14) If the renewal fees are received by the board within 30 days after the renewal expiration date, a penalty fee is charged. If renewal fees are received more than 30 days after the renewal expiration date, the license is lapsed. An application for reinstatement must be filed with the board with the reinstatement fee, the renewal fee and the penalty fee as outlined in rule 101.98(147). Licensees who fail to submit the renewal application and complete documentation of continuing education hours shall be required to pay a penalty fee and shall be subject to an audit of their continuing education report.

ITEM 16. Adopt new subrule 101.2(15) as follows:

101.2(15) Funeral directors who have not fulfilled the requirements for license renewal or an exemption in the required time frame will have a lapsed license and shall not engage in the practice of mortuary science.

ITEM 17. Amend paragraph 101.3(1)"c" as follows:

c. Before being eligible to take the practical portion of the mortuary science examination, for licensure, the intern must have filed the 25 completed embalming and funeral directing case reports and a 6-month and a 12-month evaluation form with the department of public health.

ITEM 18. Amend paragraph 101.3(1)"e" as follows:

e. No licensed funeral director or firm of funeral directors licensed funeral establishment shall have more than one intern funeral director for the first 100 human remains embalmed or funerals conducted per year, and with a maximum of two interns per firm funeral establishment.

ITEM 19. Rescind and reserve paragraph 101.3(1)"g."

ITEM 20. Amend paragraph 101.3(2)"a" as follows:

a. Beginning July 1, 1995, to be eligible to serve as a preceptor, such A prospective preceptor must have a valid preceptor certificate. A preceptor must have completed a training course within five years of accepting an intern. If the certification is older than five years, the director must recertify as specified by the board.

ITEM 21. Rescind and reserve paragraph 101.3(2)"e."

ITEM 22. Rescind and reserve subparagraph 101.3(2)"f"(1).

ITEM 23. Amend subrule 101.4(1) as follows:

101.4(1) Any person holding a valid license as a funeral director in another state having requirements substantially equal to those in Iowa, may apply for a license to practice in this state by filing an application to practice by endorsement. All applications for endorsement licenses shall be made on the official forms supplied by the Department of Public Health, Lucas Building, Des Moines, Iowa 50319-0075.

ITEM 24. Amend subrule 101.4(2) as follows:

101.4(2) All applicants for endorsement licenses will be required to pass the oral and practical examination before this board. The following shall be required:

a. An application fee.

b. Official verification of license status mailed directly from the endorsing state to the board office.

c. An official transcript of grades showing the completion of a mortuary science program accredited by the American Board of Funeral Service Education.

d. Official transcript of grades showing 60 semester hours from a regionally accredited college or university with a minimum of a 2.0 or "C" grade point average.

e. Successful passage of the Iowa law and rules examination with a score of at least 75 percent.

ITEM 25. Rescind and reserve subrule 101.4(3).

ITEM 26. Amend subrule 101.4(4) as follows:

101.4(4) All applicants for endorsement licenses shall hold original license in good standing obtained upon examination in the state from which the endorsement was received. The examination shall have covered substantially the same subjects in which an examination is required in Iowa, showing the applicant has attained a grade of at least 70 percent in each subject with a minimum of 75 percent overall average passing grade. Applicants licensed before 1980 are exempt from showing a passing grade on an examination. The applicant shall have met the educational requirements of the state of Iowa for a funeral director.

ITEM 27. Amend subrule 101.4(5) as follows:

101.4(5) Each applicant must furnish certified evidence of two or more years of actual practice as a licensed funeral director in the state from which the applicant desires to endorse, immediately preceding the filing of the application for endorsement and must be vouched for by the board of mortuary science examiners of that state.

ITEM 28. Rescind subrule 101.4(7) and adopt the following new subrule in lieu thereof:

101.4(7) Licensees who were issued their initial license by endorsement within six months of their birth month will not be required to renew their license until the fifteenth day of their birth month two years later. The new licensee is exempt from meeting the continuing education requirement for the continuing education biennium in which the license was originally issued.

ITEM 29. Rescind and reserve paragraph 101.5(1)"c."

ITEM 30. Amend paragraph 101.5(1)"d" as follows:

d. Provide evidence of completion of 12 hours of continuing education for each lapsed year, not to exceed 72 hours. Hours need not exceed 72 hours if obtained within the past two years, except when there is a demonstrated deficiency for specialized education as determined by the board through a personal interview.

(1) The board may grant an extension of time of up to one year to allow compliance with continuing education requirements for reinstatement.

(2) An exemption from the required reporting of continuing education for the purpose of renewal of an active practitioner may be granted by the board in accordance with rule 101.107(272C).

ITEM 31. Adopt new paragraph 101.5(1)"e" as follows:

e. Must successfully pass the state law and rules examination with a score of at least 75 percent.

ITEM 32. Rescind and reserve subrule 101.5(2).

ITEM 33. Adopt new rule 645--101.6(147,272C) as follows:

645--101.6(147,272C) Inactive practitioners.

101.6(1) Exemptions. A licensee who is not engaged in the practice of mortuary science in the state of Iowa may be granted a waiver of compliance and obtain a certificate of exemption upon written application to the board. The application shall contain a statement that the applicant will not engage in the practice of mortuary science in Iowa without first complying with all regulations governing reinstatement after exemption. The application for a certificate of exemption shall be submitted upon the form provided by the board.

101.6(2) Reinstatement of inactive practitioners. Inactive practitioners who have been granted a waiver of compliance with these rules and have obtained a certificate of exemption shall, prior to engaging in the practice of mortuary science in the state of Iowa, satisfy the following requirements for reinstatement:

a. Submit a written application for reinstatement on a form provided by the board with the reinstatement fee.

b. Furnish, in addition to the application, evidence of one of the following:

(1) The full-time practice of mortuary science in another state of the United States or District of Columbia and com-pletion of continuing education for each year of inactive status substantially equivalent in the opinion of the board to that required under these rules; or

(2) Completion of 24 hours of board-approved continuing education and successful completion of the state law and rules examination administered by the board.

ITEM 34. Rescind and reserve rule 645--101.7(17A).

ITEM 35. Amend subrule 101.98(3) as follows:

101.98(3) Fee for renewal of a funeral director's license for a biennial period is $100. Biennial renewal fee for a license to practice mortuary science for the 1999 renewal cycle only is as follows:

Birth Month Prorated Fee

July 1999 $100

August 1999 $104

September 1999 $108

October 1999 $112

November 1999 $117

December 1999 $121

January 2000 $125

February 2000 $129

March 2000 $133

April 2000 $137

May 2000 $142

June 2000 $146

ITEM 36. Amend subrule 101.98(9) as follows:

101.98(9) Application fee for reinstatement of a funeral director's license is $100 $50. Examination fee for reinstatement of a funeral director's license is $100.

ITEM 37. Adopt new subrules 101.98(12) to 101.98(15) as follows:

101.98(12) Fee for returned check for insufficient funds is $15.

101.98(13) Fee for funeral establishment is $75.

101.98(14) Fee for three-year renewal of funeral establishment is $75.

101.98(15) Fee for reinstatement of a funeral establishment is $50.

ITEM 38. Rescind subrule 101.101(2) and adopt the following new subrule in lieu thereof:

101.101(2) The continuing education compliance period shall be each biennium beginning the fifteenth day of the licensee's birth month and ending two years later on the fifteenth day of the birth month. Approved continuing education programs attended during this time period shall be used as evidence of fulfilling continuing education requirements.

ITEM 39. Amend subrule 101.101(4) as follows:

101.101(4) Carryover credit of continuing education hours will not be permitted. Continuing education credit will only be allowed once for the same course in the renewal cycle.

ITEM 40. Rescind subrule 101.101(6) and adopt the following new subrule in lieu thereof:

101.101(6) When an initial license is issued via examination, the new licensee is exempt from meeting the continuing education requirement for the continuing education biennium in which the license was originally issued.

ITEM 41. Adopt new subrule 101.101(7) as follows:

101.101(7) For the 1999 renewal cycle only, the continuing education hours will be prorated as follows:

Birth Month Prorated Continuing Education

July 1999 30 hours

August 1999 31 hours

September 1999 32 hours

October 1999 33 hours

November 1999 34 hours

December 1999 35 hours

January 2000 36 hours

February 2000 37 hours

March 2000 38 hours

April 2000 39 hours

May 2000 40 hours

June 2000 41 hours

Continuing education hours will return to 24 hours each biennium at the end of this prorated compliance period.

ITEM 42. Amend subrule 101.102(2) as follows:

101.102(2) It pertains to common subjects or other subject matters which integrally relate to the practice of mortuary science;. The course shall fall into one of the categories outlined below, and the course shall be applicable for funeral service practitioners. These categories are consistent with those recommended by the American Board of Funeral Service Education. The following categories are accepted:

a. Public health and technical: chemistry, microbiology and public health, anatomy, pathology, restorative art, arterial and cavity embalming.

b. Business management: accounting, funeral home management and merchandising, computer application, funeral directing, small business management.

c. Social sciences/humanities: psychology of grief, counseling, sociology of funeral service, history of funeral service, communication skills, philosophy.

d. Legal, ethical, regulatory: mortuary law, business law, ethics, federal trade commission, OSHA, ADA, EPA, preneed regulation, social services, veterans affairs benefits, insurance, state and county burial benefits, legislative concerns; and

ITEM 43. Amend subrule 101.102(4) as follows:

101.102(4) Except as may be allowed pursuant to rule 645--101.107(272C), no a licensee shall may receive credit exceeding 10 percent of for the total biennium required continuing education hours in the form of self-study, including television viewing, Internet, video- or sound-recorded programs, or correspondence work, or by other similar means as authorized by the board. Self-study credits must be accompanied by a certificate of testing and successful completion from the sponsoring organization and will be accepted only if approved by the board.

ITEM 44. Adopt new subrules 101.102(5) and 101.102(6) as follows:

101.102(5) Successfully completed college courses that fall into the general categories delineated in 101.102(2) shall be accepted.

1. One semester credit = 10 hours of continuing education credit.

2. One trimester credit = 8 hours of continuing education credit.

3. One quarter credit = 7 hours of continuing education credit.

A course description and an official school transcript indicating successful completion of the course must be provided by the licensee to receive credit for an academic course if continuing education is audited.

101.102(6) Presenters of a structured continuing education program or college course that meets the criteria established in 101.102(2) may receive 1.5 times the number of hours granted the attendees. These hours shall be granted only once per biennium for identical presentations.

ITEM 45. Amend subrule 101.103(2) as follows:

101.103(2) Prior approval of activities. An organization or person other than an accredited sponsor, which desires prior approval of a course, program or other continuing education activity, or who desires to establish accreditation of an activity prior to attendance thereat, shall apply for approval to the board at least 60 30 days in advance of the commencement of the activity on a form provided by the board. The board shall approve or deny the application in writing within 60 30 days of receipt of the application. The application shall state the dates, subjects offered, total hours of instruction, names and qualifications of speakers and other pertinent information.

ITEM 46. Amend rule 645--101.200(272C) by adopting the following new definitions in alphabetical order:

"Crematory" means any person, partnership or corporation that performs cremation and sells funeral goods.

"Funeral establishment" means a place of business as defined by the board devoted to providing any aspect of mortuary science.

ITEM 47. Amend rule 645--101.212(272C), catchwords, as follows:

645--101.212(272C) Method of discipline: licensed funeral director.

ITEM 48. Adopt new rules 645--101.213(272C) and 645--101.214(272C) as follows and renumber existing rule 645--101.213(272C) as 645--101.215(272C):

645--101.213(272C) Method of discipline: licensed funeral establishments and licensed cremation establishments.

101.213(1) The board has authority to impose the following disciplinary sanctions:

1. Refuse to issue or renew a license.

2. Revoke a license.

3. Restrict, cancel or suspend a license.

4. Place a license on probation.

5. Impose a penalty not to exceed $10,000.

6. Issue a reprimand.

101.213(2) The board may impose any of the sanctions if the board finds that the applicant or licensee has done any of the following:

a. Committed fraud in the procurement of an establishment license.

b. Been convicted of a felony or a misdemeanor involving moral turpitude, or if the applicant is an association, joint stock company, partnership, or corporation, that a managing officer has been convicted of a felony involving moral turpitude under the laws of this state, another state, or the United States.

c. Violated Iowa Code chapter 156 or any rule promulgated by the board or that any owner or employee of the establishment has violated this chapter or any rule under this chapter.

d. Knowingly aided, assisted, procured, or allowed a person to unlawfully practice mortuary science.

e. Failed to engage in or ceased to engage in the business for which the license was granted.

f. Failed to keep and maintain records as required by Iowa Code chapter 156 or rules promulgated by the board.

g. Knowingly made misleading, deceptive, untrue or fraudulent representations in the funeral practice or engaged in unethical conduct or practice harmful or detrimental to the public. Proof of actual injury need not be established.

h. Engaged in unethical business practices including false or misleading advertising, falsifying business records or failure to disclose the items.

i. Failed to comply with the requirements of Iowa Code chapter 523A.

j. Violated any of the regulations promulgated by the Federal Trade Commission.

645--101.214(272C) Disciplinary proceedings for funeral and cremation establishments. Disciplinary proceedings regarding the funeral establishment or cremation establishment license shall be initiated and conducted in conformance with Iowa Code chapter 17A and shall be initiated and conducted in accordance with the disciplinary procedures for funeral directors.

ARC 7987A

Pursuant to the authority of Iowa Code section 147.76, the Iowa Board of Social Work Examiners hereby gives Notice of Intended Action to amend Chapter 280, "Board of Social Work Examiners," Iowa Administrative Code.

These amendments change the Board quorum from five members to four members, establish supervision requirements and parameters for licensure at the independent level of licensure, and provide some clarifying language.

Any interested person may make written or oral suggestions or comments on these proposed amendments on orbefore May 26, 1998. Comments should be directed toRoxanne Sparks, Bureau of Professional Licensure, Iowa Department of Public Health, Lucas State Office Building, Fourth Floor, Des Moines, Iowa 50319-0075.

A public hearing will be held on May 27, 1998, from 9 to 11 a.m. in the Fourth Floor Conference Room, Side 1, Lucas State Office Building, at which time persons may present their views either orally or in writing. At the hearing, persons will be asked to give their names and addresses for the record and to confine their remarks to the subject of the proposed amendments.

The Board has determined that the amendments will have no impact on small business within the meaning of Iowa Code section 17A.31.

These amendments are intended to implement Iowa Code chapters 154C and 272C.

The following amendments are proposed.

ITEM 1. Amend subrule 280.2(1) as follows:

280.2(1) The board consists of five members appointed by the governor and confirmed by the senate. Three members are licensed to practice social work and two members, who are not licensed to practice social work, shall represent the general public. A quorum shall consist of three members of the board. As of July 1, 1998, the board shall consist of a total of seven members, five who are licensed to practice social work, with at least one from each of three levels of licensure described in Iowa Code section 154C.3, subsection 1, two employed by a licensee under Iowa Code chapter 237, and two who are not licensed social workers and who shall represent the general public. A quorum shall consist of five four members of the board.

ITEM 2. Amend subrule 280.2(2) as follows:

280.2(2) A chairperson, vice chairperson, and secretary to the board, and delegate and alternate delegate to the AASSWB American Association of State Social Work Boards (AASSWB) shall be elected at the first meeting after April 30 of each year.

ITEM 3. Amend subrule 280.3(3), paragraph "e," as follows:

e. Supervision is 1 hour of face-to-face contact for every 15 hours of practice unless a waiver is granted by the board. Supervision shall be provided in either any of the following manners:

(1) By a social worker licensed at least at the independent level of the social worker work being supervised and as qualified under this section rule 280.8(154C) to practice without supervision.

(2) By another qualified professional, if the board of social work examiners determines that supervision by a social worker as defined in subparagraph (1) rule 280.8(154C) is unobtainable or in other situations considered appropriate by the board.

ITEM 4. Rescind subrule 280.3(4).

ITEM 5. Amend subrule 280.4(1) as follows:

280.4(1) Any person seeking a license shall complete and submit to the board a completed application form, which form is provided by the board, to the board office no later than 45 days prior to the date of the electronic examination. From July 1, 1996, to June 30, 1998, any person seeking a license shall complete and submit to the board a completed application form at any time unless the person is choosing to sit for the examination, in which case the application must be received by the board office no later than 45 days prior to the date of the electronic examination.

ITEM 6. Adopt new rule 645--280.8(154C) as follows:

645--280.8(154C) Supervision.

280.8(1) Supervision for independent social work license. All social workers who seek to attain licensure as an independent social worker shall have practiced social work in a supervised setting in accordance with the following requirements.

a. To be eligible for licensure as an independent social worker, a candidate must obtain two years of full-time practice or 4,000 hours of post-master's social work degree experience over a minimum two-year and maximum six-year period. Of these two years of full-time practice or 4,000 hours of post-master's social work degree experience, at least 110 hours of supervision is required. This 110 hours of supervision must be equitably distributed throughout a minimum of a two-year period. The board retains the authority to review extraordinary circumstances relevant to the time parameters of supervised practice. No more than 60 hours of the 110 hours can be provided in group supervision. Group supervision may be composed of no more than six supervisees per group. The board maintains the authority to grant exceptions to the time parameters of supervised practice upon written request of the applicant.

b. Supervision must be in face-to-face meetings between the supervisor and the supervisee unless the board has granted an exception allowing for an alternate form of supervision, upon written request of the applicant.

280.8(2) Qualifications for supervisor. An individual providing supervision to an LISW candidate shall be a licensed independent social worker. An individual licensed in another state and providing supervision for an Iowa LISW candidate must be licensed at a level equivalent to Iowa's LISW level.

a. A supervisor of an LISW candidate must have a minimum of 2,000 hours of practice earned over a period of two years of practice beyond receipt of a license to practice independent social work in Iowa or the equivalent license from another state.

b. Exceptions to this rule shall be made on an individual basis. Requests for alternative supervisors must be submitted in writing, and the board must approve the supervisor prior to commencement of the supervision.

280.8(3) Supervision responsibilities.

a. Setting of supervision. If supervision is not provided within the agency of employment, the supervisee must obtain a written release from the agency administrator pertaining to practice with agency clients. If this is not possible, then the supervisee and agency supervisor may request, in writing, an exception to this rule.

b. Plan for supervision. A plan for supervision must be established and maintained throughout the supervisory period. Such a plan must be kept by the supervisor for a period of seven years and must be submitted to the board upon its request for audit within 30 days from receipt of the request. A grandparenting period of one year from the date of this administrative rule shall be granted to all those who have started supervision as provided in the prior administrative rules. The board reserves the right to audit such plans.

c. Content areas for supervision. The supervisor is responsible for supervision within the following content areas:

(1) Practice skills.

(2) Practice management skills.

(3) Skills required for continuing competence.

(4) Development of professional identity.

(5) Ethical practice.

d. The areas of supervisory accountability shall include:

(1) Area of social work practice.

(2) Agency providing services.

(3) Legal and regulatory requirements.

(4) Ethical standards of the profession.

(5) Acceptance of professional responsibility for the social work services provided by the supervisee.

280.8(4) Documentation for supervision of independent practice.

a. A plan for supervision must be created at the beginning of a period of supervision and be maintained by the supervisor. If there is a change of supervisors, it is the responsibility of the LISW candidate to have a termination evaluation completed by that supervisor and to provide a copy to the next supervisor. The LISW candidate must also provide the supervisor the supervision report sheet described in paragraph "b" below.

b. At the end of supervision, any and all supervisors shall complete a supervision report sheet. This sheet shall be answered in full and signed by both the supervisor and supervisee. This report shall be submitted to the board for review and approval prior to the completion of the LISW level exam.

ARC 7989A

The Department is terminating the proposed amendment to 1.2(1)"a"(1) and is resubmitting a Notice of Intended Action amending this chapter in order to incorporate significant changes to the rules originally proposed.

ARC 7990A

Pursuant to the authority of Iowa Code sections 135.11 and 139.2, the Department of Public Health hereby gives Notice of Intended Action to amend Chapter 1, "Notification and Surveillance of Reportable Diseases," Iowa Administrative Code.

The first purpose of this amendment is to include certain levels of CD4 laboratory results as a reportable AIDS-defining condition. The Centers for Disease Control and Prevention expanded the case definition of AIDS on January 1, 1993, to include immunologic criteria defined as CD4T-lymphocyte laboratory test results of less than 200 cells per microliter, or a CD4 T-lymphocyte percent of total lymphocytes less than 14. Laboratory-initiated CD4 reporting will enhance AIDS surveillance by identifying proportionately more AIDS cases earlier in the course of their disease and with less reporting delay. This method of AIDS case ascertainment will enhance the state's ability to more completely monitor the epidemic in Iowa.

Presently 27 states have mandated laboratory-based CD4 reporting. Laboratory reporting of the CD4 values will serve as a cue to contact attending physicians to obtain AIDS case reports. A small proportion of the low CD4 reports will be linked to immunosuppression in renal transplantation, hereditary disorders, and other non-HIV conditions. This information, however, will become evident upon physician contact so that no report will be generated. The clear benefit of CD4 reporting is more complete epidemiologic ascertainment and preventing the unnecessary loss of federal funds due to underreporting of AIDS cases.

The second purpose of this amendment is to add several other infectious diseases to the reportable disease list. These are Enterococcus invasive disease, Group A Streptococcus invasive disease, Staphylococcus aureus invasive disease, Streptococcus pneumoniae invasive disease, Cyclospora, Hantavirus syndromes, Listeria monocytogenes invasive disease, and Vancomycin-resistant Staphylococcus aureus.

Isolates of the abovementioned diseases should be sent to the University of Iowa Hygienic Laboratory. The reporting of the above will allow tracking of antibiotic resistance and emergence of new diseases.

The final purpose of this amendment is to correct a typographical error in the current rule.

Any interested person may make written suggestions or comments on the proposed amendment on or before May 26, 1998. Written comments may be sent to Judith H. Goddard, Planning and Administration, Center for Acute Disease Epidemiology, Department of Public Health, Lucas State Office Building, Des Moines, Iowa 50319-0075; fax (515) 281-4958.

Also, there will be a public hearing on May 27, 1998, at10 a.m. at which time persons may present their views. The public hearing will be held at the Department of Public Health, Third Floor Conference Room, Side 1, Lucas State Office Building, East 12th and Grand Avenue, Des Moines.

Any persons who plan to attend the public hearing and have special requirements, such as hearing or mobility impairments, should contact the Department of Public Health and advise of special needs.

This amendment is intended to implement Iowa Code section 139.2.

The following amendment is proposed.

Amend subrule 1.2(1), paragraph "a," as follows:

a. Specific infectious diseases:

(1) Common diseases:

Acquired Immune Deficiency Syndrome (AIDS) and AIDS-defining conditions including CD4 T-lymphocyte count less than 200/microliter, or CD4 T-lymphocyte percent of total lymphocytes less than 14

_Campylobacteriosis

Chlamydia

Cryptosporidiosis

Encephalitis, arboviral

_Enterococcus invasive disease

_Escherichia coli 0157:H7 and related diseases (includes HUS)

Giardiasis

Gonorrhea

_Group A Streptococcus invasive disease

Hepatitis, types A, B, C, D, and E

_*Haemophilus influenza type B invasive disease

Human Immunodeficiency Virus infection

Legionellosis

Lyme Disease

_*Meningococcal invasive disease

Pertussis

*Rabies (animal and *human)

*Measles (rubeola)

_Salmonellosis (including Typhoid fever)

_Shigellosis

_Staphylococcus aureus invasive disease

_Streptococcus pneumoniae invasive disease

Syphilis

Tuberculosis

(2) Rare diseases:

Anthrax

*Botulism

Brucellosis

*Cholera

Cyclospora

*Diphtheria

Hansen's disease (Leprosy)

Hantavirus syndromes

_Listeria monocytogenes invasive disease

Malaria

Mumps

*Plague

*Poliomyelitis

Psittacosis

Rocky Mountain Spotted Fever

Rubella (including congenital)

Tetanus

Toxic Shock Syndrome

Trichinosis

Yellow fever

_*Vancomycin-resistant Staphylococcus aureus

*Outbreaks of any kind, usual unusual syndromes, or uncommon diseases

*Diseases which are underlined and noted with an asterisk should be reported IMMEDIATELY by telephone 1-800- 362-2736.

_Isolates from diseases so noted should be sent to the University of Iowa Hygienic Laboratory.

ARC 7981A

Pursuant to the authority of Iowa Code section 730.5, the Iowa Department of Public Health hereby gives Notice of Intended Action to rescind Chapter 12, "Approval of Laboratories for Employee Drug Testing," Iowa Administrative Code, and adopt a new Chapter 12, "Approval of Confirmatory Laboratories for Private Sector Drug-Free Workplace Testing."

This action is necessary as a consequence of amendments to Iowa Code section 730.5 made by 1998 Iowa Acts, House File 299.

The new Chapter 12 describes the procedures and requirements that a laboratory must follow to receive approval by the Iowa Department of Public Health to conduct confirmatory testing of samples for the detection of alcohol or drugs in private sector employees or prospective employees. Laboratories certified by the federal Substance Abuse and Mental Health Services Administration are no longer required to receive Iowa approval.

Any interested person may submit written comments on the proposed rules by 4:30 p.m. on Wednesday, May 27, 1998. Written comments should be sent to Mike Guely, Iowa Department of Public Health, Division of Health Protection, Private Sector Drug Testing Program, Lucas State Office Building, Des Moines, Iowa 50319-0075; fax (515) 281-4529.

A public hearing will be held Wednesday, May 27, 1998, at 1:30 p.m. in the Third Floor Conference Room, Lucas State Office Building, 321 East 12th Street, Des Moines, Iowa, at which time persons may present their comments orally or in writing.

Any persons who plan to attend the public hearing and have special requirements, such as hearing or mobility impairments, should contact the Iowa Department of Public Health and advise of specific needs.

These rules were also Adopted and Filed Emergency and are published herein as ARC 7982A. The content of that submission is incorporated by reference.

These rules are intended to implement 1998 Iowa Acts, House File 299.

ARC 7984A

Pursuant to the authority of Iowa Code section 99D.7 and Iowa Code Supplement section 99D.25A as amended by 1998 Iowa Acts, Senate File 2121, the Iowa Racing and Gaming Commission hereby gives Notice of Intended Action to amend Chapter 10, "Thoroughbred Racing," Iowa Administrative Code.

Item 1 allows for the administration of Lasix in the horse's stall.

Item 2 outlines the information the practicing veterinarian must supply to the Commission after administration of Lasix to a racing animal.

Any person may make written suggestions or comments on the proposed amendments on or before May 26, 1998. Written material should be directed to the Racing and Gaming Commission, 717 E. Court, Suite B, Des Moines, Iowa 50309. Persons who wish to convey their views orally should contact the Commission office at (515)281-7352.

Also, there will be a public hearing on May 26, 1998, at9 a.m. in the office of the Racing and Gaming Commission, 717 E. Court, Suite B, Des Moines, Iowa. Persons may pre-sent their views at the public hearing either orally or in writing.

These amendments were also Adopted and Filed Emergency and are published herein as ARC 7985A. The content of that submission is incorporated by reference.

These amendments are intended to implement Iowa Code Supplement section 99D.25A as amended by 1998 Iowa Acts, Senate File 2121.

April 1, 1997 -- April 30, 1997 8.50%

May 1, 1997 -- May 31, 1997 8.75%

June 1, 1997 -- June 30, 1997 9.00%

July 1, 1997 -- July 31, 1997 8.75%

August 1, 1997 -- August 31, 1997 8.50%

September 1, 1997 -- September 30, 1997 8.25%

October 1, 1997 -- October 31, 1997 8.25%

November 1, 1997 -- November 30, 1997 8.25%

December 1, 1997 -- December 31, 1997 8.00%

January 1, 1998 -- January 31, 1998 8.00%

February 1, 1998 -- February 28, 1998 7.75%

March 1, 1998 -- March 31, 1998 7.50%

April 1, 1998 -- April 30, 1998 7.50%

May 1, 1998 -- May 31, 1998 7.75%

ARC 7986A

Pursuant to the authority of Iowa Code sections 476.1 and 476.2, the Utilities Board (Board) gives notice that on April 13, 1998, the Board issued an order in Docket No. RMU-98-2, In Re: Energy Efficiency Plans and Standards, "Order Commencing Rule Making," to consider amendments to 199 IAC Chapter 35.

The purpose of these proposed amendments is to implement the legislative directive in Iowa Code section 476.6(19)"b" that the Board develop specific capacity and energy savings standards for each utility. In these amendments to Chapter 35, the Board proposes the review of assessments and development of capacity and energy savings standards be conducted approximately every four years in a contested case proceeding in conjunction with the Board's review of the utilities' energy efficiency plans. New filing requirements related to the assessment of potential are included in proposed subrule 199 IAC 35.8(1). The Board proposes to extend the time for collaboration in order to accommodate this new aspect of energy efficiency planning. The Board also proposes to revise the Board's current energy efficiency plan rules to make them consistent with Iowa Code section 476.6(19)"b." The revised plan rules are in 199 IAC 35.8(2).

Pursuant to Iowa Code section 17A.4(1)"a" and "b," any interested person may file a written statement of position on the proposed amendments no later than May 29, 1998, by filing an original and ten copies in a form substantially complying with 199 IAC 2.2(2). All written statements should clearly state the author's name and address and should make specific reference to this docket. All communications should be directed to the Executive Secretary, Iowa Utilities Board, 350 Maple Street, Des Moines, Iowa 50319-0069.

An oral presentation is scheduled for June 18, 1998, at 10 a.m. in the Utilities Board's Hearing Room, 350 Maple Street, Des Moines, Iowa. Pursuant to 199 IAC 3.7(17A, 474), all interested persons may participate in this proceeding. Persons with disabilities requiring assistive services or devices to observe or participate should contact the Utilities Board at (515)281-5256 in advance of the scheduled date to request that appropriate arrangements be made.

These amendments are intended to implement Iowa Code section 476.6(19).

The following amendments are proposed.

ITEM 1. Amend rule 199--35.1(476) as follows:

199--35.1(476) Policy and purpose. The board deems the implementation of effective energy efficiency plans by utilities and the opportunity of the utilities' customers to participate in and benefit from the energy efficiency plans to be of the highest priority.

These rules are intended to implement Iowa Code sections 476.1, 476.2(7), 476.6(17, 19 to 21), and 476.10A, for rate-regulated gas and electric utilities required by statute to be rate-regulated and to provide the board the necessary information to review each utility's assessment of potential, to develop specific capacity and energy savings performance standards for each utility and to evaluate the appropriateness of each utility's energy efficiency plan.

Information provided in each plan shall be filed in the following sequence and shall include:

1. A transmittal letter, as provided in rule 35.8(476).

2. An executive summary, as provided in rule 35.8(476).

3. A forecast of the utility's future energy and capacity requirements compared with existing supplies to determine the need for and timing of new resources, as provided in rule 35.9(476) or 35.10(476).

4. A review of supply-side options which could meet the projected capacity shortfalls to develop present values of the utility's avoided costs, as provided in rule 35.9(476) or 35.10(476).

5. An assessment of various demand-side energy efficiency options reflecting potential to meet forecasted needs, as provided in rule 35.8(476).

6. A description of potential programs developed by the utility as provided in rule 35.8(476).

7. A description of the criteria to rank and select programs for inclusion in the plan and a determination of cost-effectiveness by comparing the costs of programs to avoided costs, as provided in rule 35.8(476). Demand side programs which pass the societal benefit/cost test using a discount rate reflecting the time value of money to society are considered cost-effective.

8. A list of the utility's proposed energy efficiency programs, budgets and monitoring and evaluation procedures as provided for in rule 35.8(476).

9. An assessment of impacts of the proposed programs as provided for in rule 35.8(476).

10. An explanation of the coordination efforts with other utilities as provided in rule 35.8(476).

ITEM 2. Amend rule 199--35.2(476) as follows:

Amend the following definitions:

"Benefit/cost tests" means one of the four acceptable economic tests used to compare the present value of applicable benefits to the present value of applicable costs of an energy efficiency option or program or plan. The tests are the participant test, the ratepayer impact test, the societal test, and the utility cost test. An option or A program or plan passes a benefit/cost test if the benefit/cost ratio is equal to or greater than one.

"Energy efficiency options measures" means activities on the customers' side of the meter which reduce customers' energy use or demand including, but not limited to, end-use efficiency improvements; load control or load management; thermal energy storage; or pricing strategies.

"Incremental cost" means the difference in the customer's cost between a less energy efficient option measure and a more energy efficient option measure.

"Participant test" means an economic test used to compare the present value of benefits to the present value of costs over the useful life of an energy efficiency option measure or program from the participant's perspective. Present values are calculated using a discount rate appropriate to the class of customers to which the energy efficiency option measure or program is targeted. Benefits are the sum of the present values of the customers' bill reductions, tax credits, and customer incentives for each year of the useful life of an energy efficient option measure or program. Costs are the sum of present values of the customer participation costs (including initial capital costs, ongoing operations and maintenance costs, removal costs less a salvage value of existing equipment, and the value of the customer's time in arranging installation, if significant) and any resulting bill increases for each year of the useful life of the option measure or program. The calculation of bill increases and decreases must account for any time differentiated rates to the customer or class of customers being analyzed.

"Process-oriented industrial assessment" means an analysis which promotes the adoption of energy efficiency options measures by examining the facilities, operations and equipment of an industrial customer in which energy efficiency opportunities may be embedded and which includes:

1. The identification of opportunities which may provide increased energy efficiency in an industrial customer's production process from the introduction of materials to the final packaging of the product for shipping by:

* Directly improving the efficiency or scheduling of energy use;

* Reducing environmental waste; and

* Technological improvements designed to increase competitiveness and to achieve cost-effective product quality enhancement;

2. The identification of opportunities for an industrial customer to improve the energy efficiency of lighting, heating, ventilation, air conditioning, and the associated building envelope;

3. The identification of cost-effective opportunities for using renewable energy technology in "1" and "2" above.

"Ratepayer impact measure test" means an economic test used to compare the present value of the benefits to the present value of the costs over the useful life of an energy efficiency option measure or program from a rate level or utility bill perspective. Present values are calculated using the utility's discount rate. Benefits are the sum of the present values of utility avoided capacity and energy costs (excluding the externality factor) and any revenue gains due to the energy efficiency options measures for each year of the useful life of the option measure or program. Costs are the sum of the present values of utility increased supply costs, revenue losses due to the energy efficiency options measures, utility program costs, and customer incentives for each year of the useful life of the option measure or program. The calculation of utility avoided capacity and energy, increased utility supply costs, and revenue gains and losses must use the utility costing periods.

"Societal test" means an economic test used to compare the present value of the benefits to the present value of the costs over the useful life of an energy efficiency option measure or program from a societal perspective. Present values are calculated using a 12-month average of the 10-year and 30-year Treasury bond rate as the discount rate. The average shall be calculated using the most recent 12 months at the time the utility calculates its benefit/cost tests for its energy efficiency plan in subrule 35.8(6). Benefits are the sum of the present values of the utility avoided supply and energy costs including the effects of externalities. Costs are the sum of the present values of utility program costs (excluding customer incentives), participant costs, and any increased utility supply costs for each year of the useful life of the option measure or program. The calculation of utility avoided capacity and energy and increased utility supply costs must use the utility costing periods.

"Useful life" means the number of years an energy efficiency option measure will produce benefits as determined by the utility. For analysis purposes, the useful life of an energy efficiency option shall not exceed 20 years.

"Utility cost test" means an economic test used to compare the present value of the benefits to the present value of the costs over the useful life of an energy efficiency option measure or program from the utility revenue requirement perspective. Present values are calculated using the utility's discount rate. Benefits are the sum of the present values of each year's utility avoided capacity and energy costs (excluding the externality factor) over the useful life of the option measure or program. Costs are the sum of the present values of the utility's program costs, customer incentives, and any increased utility supply costs for each year of the useful life of the option measure or program. The calculation of utility avoided capacity and energy and increased utility supply costs must use the utility costing periods.

Adopt the following new definitions in alphabetical order:

"Economic potential" means the energy and capacity savings that result when measures are adopted or applied at the time it is economical to do so. For purposes of this chapter, economic potential may be determined by comparing the utility's avoided cost savings to the incremental cost of the measure.

"Phase-in technical potential" means the technical potential for energy and capacity savings from the adoption of commercially available technology and operating practices when existing equipment is replaced or new equipment is installed. For example, if an energy-using unit of equipment has a ten-year lifetime, the phase-in technical potential in any one year might be one-tenth of the total number of such units in existence plus units projected to be installed.

"Technically viable" means that a measure is appropriate for customers' equipment and buildings and Iowa's climatic conditions and does not include detrimental features which outweigh benefits.

ITEM 3. Amend rule 199--35.3(476) as follows:

199--35.3(476) Applicability. Each rate-regulated gas or electric utility required by statute to be rate-regulated shall file an assessment of potential energy and capacity savings and an energy efficiency plan which meets the requirements of this chapter shall include economically achievable programs designed to attain the performance standards developed by the board. Combination electric and gas utilities may file combined assessments of potential and energy efficiency plans. Combined plans shall specify which energy efficiency programs are attributable to the electric operation, which are attributable to the natural gas operation, and which are attributable to both. If a combination utility files separate plans, the board may consolidate the plans for purposes of review and hearing. The board will conduct a contested case proceeding for the purpose of (1) developing specific capacity and energy savings performance standards for each utility and (2) reviewing energy efficiency plans and budgets designed to achieve those savings.

ITEM 4. Amend rule 199--35.4(476), introductory paragraph, as follows:

199--35.4(476) Schedule of filings. For purposes of staggering the filing requirements, rate-regulated utilities shall be assigned to group A or group B.

ITEM 5. Amend subrule 35.4(1) as follows:

35.4(1) Biennial filings. The board will schedule each utility's subsequent application for cost recovery at the time the board issues the final decision in the proceeding for the utility's current energy efficiency plan. The board will schedule each utility's subsequent energy efficiency plan filing at the time the board issues the final decision in the utility's cost recovery proceeding which covers the preceding plan. To facilitate periodic filings of assessments of potential and energy efficiency plans at intervals of approximately four years and to facilitate prudence reviews of plan implementation at intervals of approximately two years, the board will schedule each utility's subsequent assessment of potential and energy efficiency plan filing and each utility's subsequent prudence review proceeding by order.

ITEM 6. Amend subrule 35.4(4) as follows:

35.4(4) Written notice of utility assessment of potential and energy efficiency plan. No more than 62 days prior to and prior to filing its assessment of potential and energy efficiency plan, a utility shall mail or deliver a written notice of its plan filing to all affected customers. The notice shall be submitted to the board for approval not less than 30 days prior to proposed notification of customers. The notice shall, at a minimum, include the following elements:

a. A brief identification of the energy efficiency programs being proposed by the utility;

b. The estimated impact of the programs upon customers and society; and

c. The telephone number and address of utility personnel, the board, and the consumer advocate for the customer to contact with questions.

a. A statement that the utility will be filing an assessment of potential and energy efficiency plan with the board;

b. A brief identification of the proposed energy efficiency programs and the estimated annual cost of the proposed energy efficiency programs during the five-year budget time frame;

c. The estimated annual rate and bills impacts of the proposed energy efficiency programs on each class of customer; and the estimated annual jurisdictional rate impact for each major customer grouping in dollars and as a percent, with the proposed actual increases to be filed at the time of notice to customers;

d. A statement that the board will be conducting a contested case proceeding to review the application and that a customer may file a written objection and request a hearing; and

e. The telephone numbers and addresses of utility personnel, the board and the consumer advocate, for the customer to contact with questions.

ITEM 7. Rescind and reserve rule 199--35.5(476).

ITEM 8. Amend rule 199--35.6(476) as follows:

199--35.6(476) Procedures. Board review and approval of a utility's energy efficiency plan shall be governed by the following procedures: The following procedures shall govern the board's determination of performance standards and review of energy efficiency plans:

35.6(1) Collaboration. A utility shall offer interested persons the opportunity to participate in the development of its energy efficiency plan. At a minimum, a utility shall provide the opportunity to offer suggestions for programs and for the assessment of potential and to review and comment on a draft of the assessment of potential and energy efficiency plan proposed to be submitted by the utility., or to review and comment on the existing approved plan. The utility may analyze proposals from participants to help determine the effects of the proposals on its plan. A participant shall have the responsibility to provide sufficient data to enable the utility to analyze the participant's proposal. The opportunity to participate shall commence at least 120 180 days prior to the date the utility submits its assessment of potential and plan to the board.

35.6(2) Contested case proceeding. Within 30 days after filing, each application for approval of an assessment of potential and accompanying energy efficiency plan which meets the requirements of this chapter shall be docketed as a contested case proceeding. All testimony, exhibits, and work papers shall be filed with each application for approval of an assessment of potential and energy efficiency plan or application to modify an approved energy efficiency plan. The energy bureau of the division of energy and geological resources of the Iowa department of natural resources shall be considered a party to the proceeding. All testimony, exhibits, and work papers filed by any party must be cross-referenced to the plan requirements. Any portion of any plan, application, testimony, exhibit, or work paper which is based upon or derived from a computer program shall include as a filing requirement the name and description of the computer program, and a disk and a hard copy of all reasonably necessary data inputs and all reasonably necessary program outputs associated with each such portion. One copy of the computer information will be filed with the board, one copy of this information will be provided to the energy bureau of the division of energy and geological resources of the Iowa department of natural resources, and one copy of this information will be provided to the consumer advocate. Further copies shall be provided by the utility upon request by the board or the consumer advocate. The proceeding shall follow the applicable provisions of 199 IAC 7.1(476) and 7.2(476) Chapter 7.

35.6(3) Review of proposals offered by third parties. The consumer advocate or a third-party intervenor may propose approval, modification, or rejection of a utility's assessment of potential and accompanying energy efficiency plan prior to board approval of that plan. All testimony, exhibits, and work papers shall be filed with any proposal. The testimony, exhibits, and work papers of the consumer advocate or a third-party intervenor shall include, if applicable:

a. An analysis showing why rejection of the proposed utility assessment of potential and plan is appropriate;

b. to d. No change.

35.6(4) Utility response to proposals. The utility submitting the application may respond specifically to proposals to reject or modify its plan. A response shall provide an analysis comparing its original plan and any proposed modification or alternate plan.

35.6(5) Procedural schedule. To facilitate completion of the contested case proceeding within six months from the initial date of filing, a procedural schedule based on the following guidelines shall be established:

a. Prepared direct testimony, exhibits, and work papers in support of the filing--date of initial filing.

b. Testimony, exhibits, and work papers of all otherparties--filed not later than seven weeks from the date of the initial filing.

c. Utility response to proposals--filed not later than 11 weeks from the date of the initial filing.

d. Cross examination of all testimony--initiated not later than 14 weeks after the initial filing.

e. Briefs of all parties--filed not later than 17 weeks after the initial filing.

f. Reply briefs of all parties--filed not later than 18 weeks after the initial filing.

g. Additional time may be granted a party upon a showing of good cause for the delay including, but not limited to:

(1) Delay of completion of a previous procedural step.

(2) Delays in responding to discovery requests.

35.6(6) 35.6(4) Modification after implementation. An approved energy efficiency plan and budget may be modified during implementation if the modification is approved by the board. The consumer advocate or the rate-regulated utility may file either a separate or joint application for modification. The board, on its own motion, may consider modification of the energy efficiency plan and budget.

a. The utility shall file an application to modify if any one of the following conditions occurs or is projected to occur during the current or subsequent calendar year of implementation of its plan:

(1) The total annual plan budget has changed or will change by a factor of at least plus or minus 5 percent;

(2) An individual program societal benefit/cost ratio has changed by a factor of at least plus or minus 15 percent for the programs which rank in terms of expenditures in the lower 60 percent of all programs and a factor of at least plus or minus 5 percent for the programs which rank above 60 percent in terms of expenditures;

(3 2) The percent of budget per customer class or grouping has changed or will change by a factor of at least plus or minus 10 percent;

(4) The implementation schedule of a program has changed by three months or more; or

(5 3) An approved program is eliminated or a new program is added.

b. No change.

c. Each application to modify an approved energy efficiency plan shall include:

(1) A statement of the proposed modification and the party's interest in the modification;

(2) An analysis supporting the requested modification;

(3) An estimated implementation schedule for the modification; and

(4) A statement of the effect of the modification on projected costs and benefits on attainment of the utility's performance standards and on projected results of the utility's implementation of its plan.

d. If the board finds that reasonable ground exists grounds exist to investigate the proposed modification, the application to modify a procedural schedule shall be set for hearing within 30 days after the application is filed.

e. If an application to modify is filed and the board finds that there is no reason to investigate, then the board shall issue an order stating the reasons for the board's decision relating to the application.

f. If the board rejects or modifies a utility's plan, the board may require the utility to file a modified plan and may specify the minimum acceptable contents of the modified plan.

35.6(7) Modified plan--refiling. If the board rejects or modifies a utility's plan, the board may require the utility to file a modified plan and may specify the minimum acceptable contents of the modified plan.

ITEM 9. Rescind and reserve rule 199--35.7(476).

ITEM 10. Amend rule 199--35.8(476), introductory paragraph, as follows:

199--35.8(476) Energy Assessment of potential and energy efficiency plan requirements. A utility's plan shall include a range of programs which address all customer classes across its Iowa jurisdictional territory. At a minimum, the plan shall include a program for qualified lower-income residential customers, including a cooperative program with any community action agency within the utility's service area. The utility shall consider including in its plan a program for tree planting. Advertising which is part of an approved energy efficiency program is deemed to be advertising required by the board for purposes of Iowa Code section 476.18(3). The utility's assessment of potential and energy efficiency plan shall include a summary not to exceed five pages in length written in a nontechnical style for the benefit of the general public. Each utility's assessment of potential and accompanying energy efficiency plan shall include the following:

ITEM 11. Rescind subrules 35.8(1) to 35.8(8) and 35.8(11) to 35.8(13) and adopt the following new subrules:

35.8(1) Assessment of potential and determination of performance standards. The utility shall file with the board an assessment of the potential for energy and capacity savings available from actual and projected customer usage by applying commercially available technology and improved operating practices to energy-using equipment and buildings. The time frame for analysis shall address the potential for energy and capacity savings for ten years subsequent to the year the assessment is filed. Economic benefit/cost analyses shall include sufficient additional years needed to address benefits and costs over the estimated lives of measures. At a minimum, each utility's assessment of potential shall include data and analyses as follows:

a. A base case survey projecting annual peak demand and energy use of customers' existing and estimated newenergy-using buildings and equipment. The base case survey shall identify the annual peak demand and energy savings projected to occur from customers' adoption of measures in the absence of new or continued demand-side management programs by the utility.

b. A survey to identify and describe all commercially available energy efficiency measures and their attributes needed to perform an assessment of potential energy and capacity savings, including but not limited to all relevant costs of the measures, utility bill savings, utility avoided cost savings, peak demand and energy savings, measures' lifetimes, current market saturation of the measures, market availability of the measures, and non-energy-related features, costs and benefits.

c. A description of the methods and results for any screening or selection process used to identify technically viable energy efficiency measures. The utility shall explain its elimination of measures from further consideration. The utility shall provide an assessment of either annual economic potential or annual phase-in technical potential for peak demand and energy savings from projected adoption of technically viable measures, describing its methods and assumptions.

d. An assessment of the annual potential for utility implementation of the following special measures:

(1) Peak demand and energy savings from implementation of measures targeted at qualified low-income customers, including cooperative programs with community action agencies;

(2) Implementation of tree-planting measures; and

(3) Peak demand and energy savings from cost-effective assistance to homebuilders and homebuyers in meeting the requirements of the Iowa model energy code.

e. An identification of the utility's proposed performance goals for peak demand and energy savings from utility implementation of cost-effective energy efficiency measures and special measures. The utility shall identify annual goals, by energy efficiency program and total plan, for five years subsequent to the year of the filing. The utility may constrain or accelerate projected utility implementation of measures from estimates of economic or phase-in potential, based on its assessment of market potential. The utility may consider market factors including, but not limited to, market barriers to implementation of measures, the effects of rate impacts, lost opportunities which decrease future implementation of measures, the nonenergy benefits and detriments of measures, uncertainty associated with industry restructuring, the strategic value of energy efficiency to the utility and other market factors it deems relevant. The utility shall fully describe its data and assumptions. In lieu of the data required in (1) through (5) below, the utility may reference relevant data and analyses filed in its energy efficiency plan, pursuant to subrule 35.8(2). The utility shall describe its analyses and results for factors relevant to the development of performance goals, including:

(1) Cost-effectiveness tests. The utility shall analyze for cost-effectiveness proposed measures combined with appropriate utility methods or programs, using the societal, utility, ratepayer impact and participant tests. The utility's analyses shall use inputs or factors realistically expected to influence cost-effective implementation of measures, including the avoided costs filed pursuant to rules 35.9(476) and 35.10(476) or avoided costs determined by the utility's alternative method. If the utility uses a test other thanthe societal test as the criteria for determining the cost-effectiveness of utility implementation of energy efficiency measures, the utility shall describe and justify its use of the alternative test or combination of tests and compare the results with the results of the societal test.

(2) Cost-effectiveness threshold(s). The utility shall describe and justify the level or levels of cost-effectiveness, if greater or less than a benefit/cost ratio of 1.0, to be used as a threshold for cost-effective utility implementation of measures.

(3) A description of the proposed measures to be implemented, proposed utility implementation techniques, the number of eligible participants and proposed rates of participation per year, and the estimated annual peak demand and energy savings.

(4) The budgets or levels of spending for utility implementation of measures, including proposed low-income, tree-planting and home-building assistance measures.

(5) The rate impacts and average bill impacts, by customer class, resulting from utility implementation of the measures.

f. An optional assessment of the range of potential for utility implementation of measures. If the utility's proposed standards differ from the level of energy and capacity savings resulting from the utility's current plan by more than 25 percent, the utility shall provide:

(1) Tables and descriptions showing the annual energy and capacity savings for implementation of measures at five levels of total spending, at appropriate intervals from 0 to 5 percent of the utility's gross operating revenues. The utility shall include one level of spending comparable to its current energy efficiency plan budget.

(2) At each level of spending, the utility's filing shall show the estimated rate impacts and bill impacts of utility implementation for each major customer class.

(3) As an alternative to the analyses required in (1) and (2), the utility may provide a sensitivity analysis identifying key variables, including levels of spending, and showing their impact on cost-effectiveness, energy savings, and capacity savings.

35.8(2) Proposed energy efficiency plan, programs, and budget and cost allocation. The utility shall file with the board an energy efficiency plan listing all proposed new, modified, and existing energy efficiency programs. The following information shall be provided:

a. The analyses and results of cost-effectiveness tests for the plan as a whole and for each program. Low-incomeand tree-planting programs shall not be tested for cost-effectiveness, unless the utility wishes to present the results of cost-effectiveness tests for informational purposes. The utility shall analyze proposed measures combined withappropriate utility implementation methods for cost-effectiveness, using the societal, utility, ratepayer impactand participant tests. If the utility uses a test other thanthe societal test as the criteria for determining the cost-effectiveness of utility implementation of energy efficiency measures, the utility shall describe and justify its use of the alternative test or combination of tests and compare the results with the results of the societal test. The utility shall describe and justify the level or levels of cost-effectiveness,if greater or less than a benefit/cost ratio of 1.0, to be usedas a threshold for determining cost-effectiveness of programs and the plan as a whole.

The utility shall provide an explanation of its sensitivity analysis identifying key variables showing the impact on cost-effectiveness. If appropriate and calculable, the utility shall adjust the energy and demand savings for the interactive effects of various measures contained within each program and shall adjust energy and demand savings of the plan as a whole for the interactive effects of programs. For the plan as a whole and for each program, the utility shall provide:

(1) Cost escalation rates for each cost component of the benefit/cost test that reflect changes over the lives of the options in the potential program and benefit escalation rates for benefit components that reflect changes over the lives of the options;

(2) Societal, utility cost, ratepayer impact measure, and participant test benefit/cost ratios; and

(3) Net societal benefits.

b. Descriptions of each program. If a proposed program is identical to an existing program, the utility may reference the program description currently in effect. A description of each proposed program shall include:

(1) The name of each program;

(2) The customers each program targets;

(3) The energy efficiency measures promoted by each program;

(4) The proposed utility promotional techniques, including the rebates or incentives offered through each program; and

(5) The proposed rates of program participation or implementation of measures, including both eligible and estimated actual participants.

c. The estimated annual energy and demand savings for the plan and each program for each year the measures promoted by the plan and program will produce benefits. The utility shall estimate gross and net capacity and energy savings, accounting for free riders, take-back effects, and measure degradation.

d. The budget for the plan and for each program for each year of implementation or for each of the next five years of implementation, whichever is less, itemized by proposed costs. The budget shall be consistent with the accounting plan required pursuant to subrule 35.12(1). The budget shall include a comparison of proposed spending to gross operating revenues. The budget may include the amount of the remittance to the Iowa energy center and the center for global and regional environmental research and the alternative energy revolving loan fund. The plan and program budgets shall be categorized into:

(1) Planning and design costs;

(2) Administrative costs;

(3) Advertising and promotional costs;

(4) Customer incentive costs;

(5) Equipment costs;

(6) Installation costs;

(7) Monitoring and evaluation costs; and

(8) Miscellaneous costs.

Cost categories shall be further described by the following subcategories:

Classifications of persons to be working on energy efficiency programs, full-time equivalents, dollar amounts oflabor costs, and purpose of work;

Type and use of equipment and other assets, including type of assets required and use of asset; and the name of outside firm(s) employed and a description of service(s) to be provided.

e. The rate impacts and average bill impacts, by customer class, resulting from the plan and each program.

f. A monitoring and evaluation plan. The utility shall describe in complete detail how it proposes to monitor and evaluate the implementation of its proposed programs and plan and shall show how it will accumulate and validate the information needed to verify attainment of its performance standards. The utility shall propose a format for monitoring reports and describe how annual results will be reported to the board on a detailed, accurate and timely basis.

g. Proposed energy efficiency plan allocation.

ITEM 12. Amend paragraph 35.8(9)"b" as follows:

b. A report on the participation of interested persons in the preparation of its the assessment of potential and energy efficiency plan pursuant to subrule 35.6(1) subrules 35.8(1) and 35.8(2). The report shall identify the persons with whom the utility consulted, the date and type of meetings held or other contacts made, and the results of the meetings and contacts.

ITEM 13. Amend paragraph 35.9(1)"d" as follows:

d. An explanation of all significant methods and data used, as well as assumptions made, in the current 20-year forecast. The utility shall file all forecasts of variables used in its demand and energy forecasts and shall separately identify all sources of variable inputs variables used, such as implicit price deflator, electricity prices by customer class, gross domestic product, sales by customer class, number of customers by class, fuel price forecasts for each fuel type, and other inputs.

ITEM 14. Amend subparagraph 35.9(2)"a"(1) as follows:

(1) Total system class maximum demand (in kilowatts), number of customers in the class, and system class sales (in kilowatt-hours);

ITEM 15. Amend subrule 35.9(3) as follows:

35.9(3) Existing capacity and firm commitments. Information specifying the existing generating capacity and firm commitments to provide service, which includes:. The utility shall include in its filing a copy of its most recent Load and Capability Report submitted to the Mid-continent Area Power Pool (MAPP).

ITEM 16. Amend subrule 35.9(5) as follows:

35.9(5) Capacity outside the utility's system. Information about capacity outside of the utility's system that could meet its future needs including, but not limited to, cogeneration and independent power producers, expected to be available to the utility during each of the 20 years in the planning horizon. The utility shall include in its filing a copy of its most recent Load and Capability Report submitted to the Mid-continent Area Power Pool (MAPP).

This amendment is intended to prohibit honeybees from being transported into Iowa from the state of Florida, which is known to be infested with Varroa mites that are resistant to fluvalinate miticide, the only product registered for the control of Varroa mites.

In compliance with Iowa Code section 17A.4(2), the Department finds that notice and public participation are impracticable because this situation has developed recently and the shipping season for bees is commencing immediately. Fluvalinate is the only miticide registered by the U.S. Environmental Protection Agency for the control of this pest. Beekeepers have no alternative treatment available if fluvalinate will not control the mite. The spread of these resistant mites into Iowa would place in jeopardy the health of Iowa's honeybee population and the pollination service provided by the bees. Preventing or delaying the spread of these mites into Iowa will give the time needed to fully test and register alternative mite control products.

The Department also finds, pursuant to Iowa Code section 17A.5(2)"b"(2) and (3), that the normal effective date of the amendment should be waived and this amendment should be made effective upon filing with the Administrative Rules Coordinator, as it protects the public welfare and confers a benefit up the public by protecting Iowa's honeybee pollinators from a serious pest.

This amendment is also being simultaneously published herein under Notice of Intended Action as ARC 7979A to allow for public comment.

This amendment is intended to implement Iowa Code section 160.9.

This amendment became effective April 15, 1998.

The following amendment is adopted.

Amend 21--Chapter 22 by adopting the following new rule:

21--22.10(160) Prohibit movement of infested bees. A person shall not directly or indirectly transport or cause to be transported into the state of Iowa honeybees originating in the state of Florida.

ARC 7993A

The Natural Resource Commission approved an amendment to subrule 28.13(2) at their February 12, 1998, meeting which changed the reimbursable amount for insurance to the clubs. Due to an administrative oversight, an incorrect amendment was filed with the Administrative Rules Coordinator. The amendment being filed in this rule making is the correct amendment and the one that was approved by the Commission.

In compliance with Iowa Code section 17A.4(2), the Commission finds that notice and public participation are unnecessary because this amendment is the change from the Notice of Intended Action which was previously supported by public comments (see March 11, 1998, Iowa Administrative Bulletin, ARC 7870A).

The Commission also finds, pursuant to Iowa Code section 17A.5(2)"b"(2), that the normal effective date of the amendment should be waived and this amendment should be made effective upon filing, as it confers a benefit on the public by correcting an error in previously filed rule making.

This amendment is intended to implement Iowa Code section 321G.7.

This amendment became effective April 17, 1998.

The following amendment is adopted.

Amend subrule 28.13(2), paragraph "a," as follows:

a. Program and facility liability insurance. It shall be the sponsor's responsibility to obtain program and liability insurance including snowmobile trail groomer liability insurance. A certificate of insurance must be provided to the DNR. This insurance coverage may include liability insurance for the sponsoring organization, excluding the cost of insurance for special events and excluding liability insurance on snowmobiles or all-terrain vehicles owned by the sponsor. The total payment from the snowmobile fund for insurance shall be 100 percent of the cost but limited to $600 per club represented by approved application, with a maximum of $1,800 per approved grant application, unless otherwise approved by the director. The total payment from the all-terrain vehicle fund shall be 100 percent of the cost limited to $3,500 per developed riding area. All insurance paid under this paragraph must be furnished by companies licensed to do business in Iowa.

ARC 7982A

This action is necessary as a consequence of amendments to Iowa Code section 730.5 made by 1998 Iowa Acts, House File 299.

The new Chapter 12 describes the procedures and requirements that a laboratory must follow to receive approval by the Iowa Department of Public Health to conduct confirmatory testing of samples for the detection of alcohol or drugs in private sector employees or prospective employees. Laboratories certified by the federal Substance Abuse and Mental Health Services Administration are no longer required to receive Iowa approval.

In compliance with Iowa Code section 17A.4(2), the Iowa Department of Public Health finds that notice and public participation are impracticable because it is in the best interest of employers, employees, prospective employees, and laboratories that the new chapter become effective immediately. 1998 Iowa Acts, House File 299, section 2, stipulated that "This Act takes effect on the thirtieth day following enactment." Governor Branstad signed House File 299 on Tuesday, March 17, 1998. Consequently, the rules became effective on Thursday, April 16, 1998.

The Iowa Department of Public Health further finds, pursuant to Iowa Code section 17A.5(2)"b"(2), that the normal effective date should be waived and that the new Chapter 12 become effective upon filing with the Administrative Rules Coordinator on Thursday, April 16, 1998, as it confers a benefit upon employers, employees, prospective employees, and laboratories. In order for the new law to be effective for all interested parties, laboratories must know the procedures and requirements that must be followed to seek approval as a confirmatory laboratory.

This chapter is also being published herein under Notice of Intended Action as ARC 7981A to allow for public comment.

These rules were approved by the Board of Health on April 16, 1998.

These rules are intended to implement 1998 Iowa Acts, House File 299.

These rules became effective April 16, 1998.

Rescind 641--Chapter 12 and adopt the following new Chapter 12 in lieu thereof:

641--12.2(730) Definitions. For the purpose of these rules, the following definitions shall apply:

"Alcohol" means ethanol, isopropanol, or methanol.

"Alcohol or drug testing" means analysis of a sample for the purpose of detecting the presence or absence of alcohol or other drugs, or their metabolites, in the sample tested.

"CLIA" means Clinical Laboratory Improvement Amendments of 1988.

"Confirmatory test" means a test for alcohol or other drugs, or their metabolites, using a testing method as stipulated in rule 641--12.9(730), "Confirmatory testing."

"Department" means the Iowa department of public health.

"Director" means the director of the Iowa department of public health.

"Drug" means a substance considered a controlled substance and included in Schedule I, II, III, IV, or V under the federal Controlled Substances Act, 21 U.S.C. Subsections 801 et seq.

"Employee" means a person in the service of an employer in this state and includes the employer and any chief executive officer, president, vice president, supervisor, manager, and officer of the employer who is actively involved in the day-to-day operations of the business.

"Employer" means a person, firm, company, corporation, labor organization, or employment agency, which has one or more full-time employees employed in the same business, or in or about the same establishment, under any contract of hire, express or implied, oral or written, in this state. "Employer" does not include the state, a political subdivision of the state, including a city, county, or school district, the United States, the United States Postal Service, or a Native American tribe.

"GC/MS" means gas chromatography/mass spectrometry.

"HCFA" means Health Care Financing Administration. HCFA is the federal agency responsible for implementing and administering CLIA regulations.

"Laboratory" means a facility inside or outside the state of Iowa approved to conduct confirmatory testing of samples for the detection of alcohol or other drugs, or their metabolites.

"Medical review officer" means a licensed physician, osteopathic physician, chiropractor, nurse practitioner, or physician assistant authorized to practice in any state of the United States, who is responsible for receiving laboratory results generated by an employer's drug or alcohol testing program, and who has knowledge of substance abuse disorders and has appropriate medical training to interpret and evaluate an individual's confirmed positive test result together with the individual's medical history and any other relevant biomedical information.

"Prospective employee" means a person who has made application, whether written or oral, to an employer to become an employee.

"Sample" means such sample from the human body capable of revealing the presence of alcohol or other drugs, or their metabolites. However, "sample" does not mean blood except as authorized pursuant to Iowa Code subsection 730.5(7), paragraph "l." For the purpose of these rules, the substances determined by the department to be samples from the human body capable of accurately and reliably revealing the presence of alcohol or other drugs, or their metabolites, are urine, breath, and blood.

"Specimen" means a part taken from a sample to determine the character of the whole sample.

"UHL" means university (state) hygienic laboratory.

641--12.3(730) Powers and duties. The department shall be responsible for the following actions:

12.3(1) Processing applications from laboratories requesting approval to conduct confirmatory testing pursuant to Iowa Code subsection 730.5(7), paragraph "e."

12.3(2) Developing an application package.

a. The package shall be provided to all laboratories requesting approval to conduct confirmatory testing for alcohol or other drugs, or their metabolites.

b. The package shall contain application procedures, a copy of Iowa Code section 730.5, a copy of these adminis-trative rules, a standardized application form and a self-inspection questionnaire.

c. The self-inspection questionnaire shall assist the department in assessing the quality of a laboratory's performance as a confirmatory testing laboratory. This questionnaire will comprise the major but not the sole objective criteria used during the initial on-site inspection conducted by the UHL.

d. The package shall be available upon request from the Iowa Department of Public Health, Division of Health Protection, Private Sector Drug Testing Program, Lucas State Office Building, Des Moines, Iowa 50319-0075.

12.3(3) Reviewing each application submitted and determining the adequacy for approval.

12.3(4) Designating the UHL to conduct an on-site inspection of each approved confirmatory laboratory at least once every two years. Inspection may be waived by the director if the laboratory has been inspected and certified, licensed, or approved to conduct confirmatory testing by another state whose requirements are at least equal to Iowa's.

12.3(5) Maintaining and providing upon request an updated list of all approved confirmatory laboratories.

12.3(6) Providing written notice of approval and assigning an expiration date.

641--12.4(730) Application procedures and requirements. Laboratories desiring to conduct confirmatory testing for Iowa's employers shall apply to the department for approval. Each laboratory requesting Iowa approval to conduct confirmatory testing shall provide the following to the department:

12.4(1) A completed laboratory survey checklist on a form provided by the department.

12.4(2) A completed self-inspection questionnaire provided by the department that includes:

a. A list of alcohol or other drugs, or their metabolites, being tested.

b. Copies of the two most recent and relevant graded proficiency test reports from a recognized proficiency testing program.

c. Personnel qualifications for all staff involved in the technical and administrative management of the alcohol or drug testing laboratory.

d. Copies of the forms used to report test results.

e. Chain of custody protocols and copies of the chain of custody forms used.

f. Sample collection procedures.

g. Confirmation procedures.

12.4(3) Proof of enrollment in a recognized proficiency testing program. Recognized programs include those approved by HCFA.

12.4(4) Acceptable performance over a 12-month period in all appropriate areas of proficiency testing for alcohol or other drugs, or their metabolites, shall be documented and sent to the UHL on an ongoing basis. Acceptable performance is as follows:

a. Initial approval shall require at least 80 percent accuracy in the last two graded proficiency test cycles with no false positive results.

b. Renewal shall require at least 90 percent accuracy each year on graded proficiency surveys with no false positive results.

641--12.5(730) Requirements of laboratory personnel involved in confirmatory testing for alcohol or other drugs, or their metabolites.

12.5(1) The laboratory director shall be a pathologist or doctoral level individual who qualifies as a clinical laboratory director under CLIA regulations.

12.5(2) Supervisors of analysts shall possess at least a bachelor of science degree in chemistry, medical technology, or comparable education and two years of analytical alcohol or drug testing experience. Supervisors must also have training in the theory and practice of laboratory procedures and an understanding of quality control concepts. Annual verification of the supervisor's skills must be documented by the laboratory director.

12.5(3) Analysts shall possess the necessary training and skills for assigned tasks. These individuals shall possess at least two years of college education in the physical or biological sciences. At a minimum, analysts shall be graduates of a medical laboratory technician program which is recognized by the department or have at least two years of college with a minimum of nine semester hours in chemistry.

12.5(4) Laboratory directors, supervisors and analysts involved in alcohol or drug testing shall annually complete at least one in-service continuing education program related to alcohol or drug testing. Continuing education programs include formal training programs where continuing education units are awarded, informal in-house training programs, and relevant correspondence courses. Dates, titles and subject matter for each completed course shall be documented and the information shall be available for review.

12.5(5) The following information about each of the laboratory staff involved in alcohol or drug testing shall be retained for two years from date of termination and shall be available for review.

a. Résumé of training and experience.

b. Certificate or license.

c. Job description.

641--12.6(730) Quality assurance program and procedure manual requirements. All approved confirmatory laboratories shall have a written quality assurance program and a procedure manual which encompasses all aspects of the alcohol or drug testing process.

12.6(1) Approved laboratories shall have written procedures for performing alcohol or drug testing which shall include the following:

a. Sample acquisition.

b. Chain of custody.

c. Sample and report security.

d. Test performance.

e. Reporting of results.

f. Confidentiality.

12.6(2) The quality assurance program and procedure manuals shall be available for review during any on-site inspection.

12.6(3) Approved laboratories shall review their performance in each of the above areas every 12 months.

12.6(4) Approved laboratories are responsible for developing the criteria necessary to establish and maintain an effective quality assurance program for confirmatory testing of alcohol or other drugs, or their metabolites.

641--12.7(730) Analytical quality control. The number and position of control specimens tested within a batch and the number of calibrators used for each batch of specimens shall be consistent with generally accepted laboratory practice for the methodology used to conduct confirmatory testing.

12.7(1) Positive and negative controls shall be used in testing each batch of specimens.

12.7(2) Procedures shall be implemented and documented to ensure that carryover from a positive specimen does not contaminate other subsequent specimens in that batch.

12.7(3) Approved laboratories shall develop criteria for the detection and rejection of adulterated samples.

641--12.8(730) Sample security and confidentiality of test results. Samples and reports must never be left unattended or unsecured.

12.8(1) Complete chain of custody documentation shall be maintained for each sample from the time of collection from the employee or prospective employee to the time the sample is discarded. Each time the sample is handled or transferred, the individual receiving the sample, the time and date of transfer, and the recipient or destination of the sample shall be documented.

12.8(2) If the first portion of the sample yielded a confirmed positive test result, the laboratory shall store the second portion of that sample until receipt of a confirmed negative test result or for a period of at least 45 calendar days following the completion of the initial confirmatory testing. Urine and blood samples shall be retained in secure storage at freezing temperatures.

12.8(3) All samples for which a negative test result was reported shall be disposed of within 5 working days after issuance of the negative test result report.

641--12.9(730) Confirmatory testing.

12.9(1) Reports for alcohol shall be confirmed by gas chromatography, or a test that is recognized by the department as an equivalent test before being reported as positive (or negative).

12.9(2) Reports for drugs or their metabolites, other than alcohol, shall not be issued in the absence of confirmation by GC/MS or a scientifically equivalent test approved by the department.

12.9(3) Complete chain of custody procedures shall be used for referred samples.

641--12.10(730) Documentation of the confirmatory testing process. The following documents shall be retained for at least two years and, if requested, made available for inspection.

12.10(1) Chain of custody documentation shall be maintained for each sample tested with the identification of the sample, the person(s) handling and testing the sample, the storage of the sample, and the eventual disposal of the sample.

12.10(2) Documents regarding the following: analytical information for each batch assayed; instrument identification; calibration records; identification of reagent lot numbers and expiration dates; quality control results; and any other pertinent information.

12.10(3) The UHL shall be designated to receive copies of proficiency testing results for ongoing monitoring and evaluation of each laboratory's performance. Approved confirmatory laboratories shall submit copies of proficiency testing results to the UHL or shall ensure that proficiency testing programs submit copies of proficiency testing results directly to the UHL on their behalf.

12.10(4) Current procedure manuals must be maintained for all procedures.

12.10(5) An annual review of manuals shall be performed and documented. Alterations and additions to procedures shall be incorporated into manuals and approved by the laboratory director before implementation.

641--12.11(730) Reporting of confirmed positive test results to the medical review officer.

12.11(1) Each report shall identify the alcohol or other drugs, or their metabolites, being tested with the results of positive/negative or detected/nondetected clearly recorded.

12.11(2) Approved confirmatory laboratories shall have available a written summary of the established sensitivity levels used for the confirmatory tests conducted for alcohol or other drugs, or their metabolites. However, this information need not be issued with each report.

12.11(3) Approved confirmatory laboratories shall have written procedures for making both written and telephone reports to the medical review officer.

12.11(4) All test results must be reviewed and signed by the laboratory director, or a qualified designee, before being reported to the medical review officer.

641--12.12(730) Reporting requirements to department. Pursuant to Iowa Code subsection 730.5(16), approved confirmatory laboratories shall file a report with the department by March 1 of each year. The address is Iowa Department of Public Health, Division of Health Protection, Private Sector Drug Testing Program, Lucas State Office Building, Des Moines, Iowa 50319-0075. The report for the state of Iowa shall include the number of positive and negative drug or alcohol test results for the previous calendar year for the following if available to the laboratory:

1. Employees who work in non-safety-sensitive positions,

2. Employees who work in safety-sensitive positions,

3. Employees during and after completion of drug or alcohol rehabilitation,

4. Employees as a consequence of reasonable suspicion drug or alcohol testing,

5. Prospective employees,

6. As a consequence of federal law or regulation, or by law enforcement,

7. As a consequence of accident investigation in the workplace,

8. The types of drugs which were found in the positive drug tests,

9. All significant available demographic factors relating to the positive test pool, and

10. Total number of positive and negative drug or alcohol test results for the previous calendar year for all employees and prospective employees who were tested.

641--12.13(730) Approval, renewal, and inspection fees. At the time of initial application and each year thereafter, laboratories shall remit to the department a fee in an amount sufficient to reimburse the department for expenses incurred in administering the confirmatory laboratory approval program. All fees shall be made payable to the Iowa Department of Public Health and are as follows:

12.13(1) Approval. An administration fee of $600 is required for new applications, including applicants seeking approval through reciprocity.

12.13(2) Renewal. An administration fee of $300 is required to renew laboratory approval.

12.13(3) Inspections. Reimbursement for actual on-site inspection and related expenses shall be assessed to each laboratory after the completion of each inspection. Expenses related to the on-site inspection shall be reimbursed to the UHL. These expenses shall reflect the actual cost incurred for personnel time and travel expenses consistent with state of Iowa travel reimbursement policies and procedures. These expenses shall also include the time necessary for UHL inspection staff to:

a. Review the application and related laboratory materials in preparation for the on-site inspection,

b. Generate the written laboratory report regarding inspection findings,

c. Conduct postinspection follow-up activities, if any, and

d. Review proficiency test results on an ongoing basis.

641--12.14(730) Renewal. Laboratory approval to continue confirmatory testing for alcohol or other drugs, or their metabolites, must be renewed annually. The request for renewal shall include the following:

1. Name and address of laboratory.

2. Renewal fee.

3. Information that reflects any changes that occurred during the current approval period.

4. Copy of supporting documents if certified, licensed, or approved through reciprocity.

641--12.15(730) Reciprocity.

12.15(1) Confirmatory laboratories certified, licensed, or approved by another state to conduct testing for alcohol or other drugs, or their metabolites, may request Iowa approval through reciprocity by:

a. Completing and submitting the department's application package, and

b. Including a copy of their current certificate, license, or approval document from the state whose requirements are at least equal to Iowa's.

12.15(2) Laboratories approved through reciprocity that lose their certification, license or approval from another state shall notify the department within five working days.

641--12.16(730) Changes during approval periods. The following changes that occur during an approval period shall be submitted to the department within ten working days from the date the change took place:

1. Change in laboratory director.

2. Change of address.

3. Change in supervisor.

4. Change in confirmation procedures.

5. Change in proficiency testing program.

6. Addition or subtraction of alcohol or other drugs, or their metabolites, being tested.

7. Change of ownership.

641--12.17(730) Enforcement. Upon a determination of noncompliance by the director that these rules have been violated, the director may immediately move to suspend, modify, or revoke any approval issued under these rules.

641--12.18(730) Denial, suspension, modification or rev-ocation of approval. Any one of the following can result in denial, suspension, modification or revocation of approval. Failure of the confirmatory laboratory to:

1. Remain in compliance with the requirements of these rules.

2. Provide required documentation, including documentation of laboratory personnel and proficiency test results.

3. Maintain confidentiality.

4. Meet proficiency testing criteria.

5. Provide correct information.

6. Satisfactorily complete the two most recent and relevant graded proficiency test reports from a recognized proficiency testing program (for initial approval).

7. Correctly represent facts on a self-inspection questionnaire or other application documents.

8. Pass an on-site inspection conducted by another state whose requirements are at least equal to Iowa's, or by the UHL.

641--12.19(730) Restoration of approval. A confirmatory laboratory whose approval has been suspended, modified, or revoked may be reinstated within 90 days following the receipt of the following:

1. Documentation of actions that correct the reasons for suspension, modification, or revocation.

2. Documentation of a successful on-site inspection, if necessary, conducted by another state whose requirements are at least equal to Iowa's, or by the UHL.

641--12.20(730) Appeals process.

12.20(1) Denial. Laboratories shall receive written notice by certified mail, return receipt requested, setting forth the reason(s) for denial. The adverse action shall become effective 30 days after receipt of the notice unless the applicant, within 30 days, gives written notice to the department requesting a hearing. In that event, the notice shall be deemed to be suspended.

12.20(2) Suspension, modification, or revocation. Confirmatory laboratories shall receive written notice by certified mail, return receipt requested, setting forth the reason(s) for suspension, modification, or revocation. The adverse action shall become effective 30 days after receipt of the notice unless the aggrieved party, within 30 days, gives written notice to the department requesting a hearing. In that event, the notice shall be deemed to be suspended.

12.20(3) Contested cases. The procedures for contested cases as set out in Iowa Code chapter 17A and the rules adopted by the department in 641--Chapter 173 shall be followed in all cases where proper notice has been made to the department of the intent to formally contest any denial, suspension, modification, or revocation of approval.

641--12.21(730) Complaints. The department shall accept complaints of alleged problems relating to confirmatory laboratory procedures. The information shall state in as specific a manner as possible the basis for the complaint. The complaint shall be presented in writing, in person or by telephone to the Iowa Department of Public Health, Division of Health Protection, Private Sector Drug Testing Program, Lucas State Office Building, Des Moines, Iowa 50319-0075.

Within 20 working days of the receipt of the complaint, the department shall communicate with the laboratory director for initial evaluation of the specific matters alleged in the complaint. The complainant shall be informed of the results of the action taken by the department.

These rules are intended to implement 1998 Iowa Acts, House File 299.

ARC 7985A

The Commission adopted these amendments April 17, 1998.

Item 1 allows for the administration of Lasix in the horse's stall.

Item 2 outlines the information the practicing veterinarian must supply to the Commission after administration of Lasix to a racing animal.

In compliance with Iowa Code section 17A.4(2), the Department finds that notice and public participation are impracticable because of the need to implement new provisions of the law.

The Commission finds, pursuant to Iowa Code section 17A.5(2)"b"(2), that the normal effective date of the amendments should be waived and the amendments made effective upon filing with the Administrative Rules Coordinator as they confer a benefit on the public and must be in effect prior to the 1998 racing season. These amendments are a result of 1998 Iowa Acts, Senate File 2121.

These amendments are also published herein under Notice of Intended Action as ARC 7984A to allow for public comment.

These amendments are intended to implement Iowa Code Supplement section 99D.25A as amended by 1998 Iowa Acts, Senate File 2121.

These amendments became effective April 20, 1998.

The following amendments are adopted.

ITEM 1. Rescind subrule 10.6(2), paragraph "i," and insert in lieu thereof the following new paragraph:

i. The administration of Lasix shall occur in the horse's stall, unless the commission provides that a horse must be brought to the detention barn for treatment.

ITEM 2. Amend subrule 10.6(4) by adding the following new paragraph "d" and relettering existing paragraphs "d" through "f" as "e" through "g."

d. Twenty minutes following the administration of Lasix, the veterinarian must deliver a signed affidavit certifying information regarding the treatment of the horse. The statement must at least include the name of the practicing veterinarian, the tattoo number of the horse, the location of the barn and stall where the treatment occurred, the race number of the horse, the name of the trainer, and the time that the Lasix was administered.

The Mental Health and Developmental Disabilities Commission adopted these amendments April 7, 1998. Notice of Intended Action regarding these amendments was published in the Iowa Administrative Bulletin on February 25, 1998, as ARC 7840A.

These amendments implement the following changes to policy governing grants for homeless persons with mental illness under the state grant program and the Stewart B. McKinney Homeless Assistance Act:

* The cost of engineering and legal expenses incidental to determining the feasibility or practicability of acquiring or constructing a project and initial staffing costs are no longer allowed because of limited funding.

* The requirement for a written letter of endorsement from the MH/DD Regional Planning Council is changed to a letter of endorsement from the Central Point of Coordination Administrator in counties. The MH/DD Regional Planning Councils are no longer required under Iowa law.

* Potential applicants are allowed to use a facsimile (telephone fax letter) or other methods when submitting notices of intent to apply for grant funds.

* In addition, minor language changes are made to clarify certain parts of the rules and the name of the application form is revised.

These amendments are identical to those published under Notice of Intended Action.

These amendments are intended to implement Iowa Code chapter 225C.

These amendments shall become effective July 1, 1998.

The following amendments are adopted.

ITEM 1. Amend rule 441--39.21(225C), definitions of "Applicant," "Community living arrangements," and "Construction and start-up costs," as follows:

"Applicant" means a county board of supervisors from a single county or combination of counties or a person or other entity approved in writing by a county or multicounty board of supervisors unit of local government, public housing agency, or private nonprofit organization.

"Community living arrangements" means an array of new living environments found in the community that provide to which varying levels of support which are determined are provided based on an individual's level of need and personal choice.

"Construction and start-up costs" includes costs associated with rehabilitation or renovation of an existing structure to meet the intent and purpose of this program. It also includes the cost of acquisition of all land, rights-of-way, property rights, easements, franchise rights, and interests required for acquisition, construction, or both. Cost also means the cost of engineering, legal expenses incidental to determining the feasibility or practicability of acquiring or constructing a project. It also means other expenses incidental to the acquisition or construction of a project, the financing or the acquisition or construction, including the amount authorized in the special services fund for the purposes of this program and the financing of the placing of a project in operation, and the expense of other eligible project activities including initial staffing costs. Initial staffing costs are limited to a maximum of 60 days. Start-up costs may also include: rental assistance per usage permitted under the Stewart B. McKinney Homeless Assistance Act (39.29(7 8)f); security, damage, and rental deposits; utility deposits; or similar costs associated with procuring a living arrangement from a private landlord. Limitations for the usage of funds to pay for these start-up activities will be defined for fund recipients by the division in order to best meet the intentions of the program.

Further amend rule 441--39.21(225C) by adding the following new definition in alphabetical order:

"Central point of coordination administrator" means CPC administrator as defined at rule 441--25.11(225C).

ITEM 2. Amend rule 441--39.23(225C) as follows:

Amend subrule 39.23(1) as follows:

39.23(1) Grant cycle. The administrator will announce through public notice the opening of an application period. Applicants Potential applicants for grants shall submit first a letter notice of intent to apply and then a grant proposal by the deadlines specified in the public notice.

Amend subrule 39.23(2), introductory paragraph, as follows:

39.23(2) Letter Notices of intent. Letters Notices of intent, in printed, hard-copy form, should be no longer than two typed pages and must:

Amend subrule 39.23(3) as follows:

39.23(3) Review of letters notices of intent. Only letters notices of intent received by the deadline specified in the public notice will be considered. Facsimile submittals will not be considered. Notices of intent may be sent to the department using methods that will produce a printed copy, e.g., hard copy delivered by a postal or other carrier, electronic mail documents that may be printed from the receiving computer, or a facsimile machine that produces a printed copy of the document. Verbal notices of intent shall not be considered. The sender assumes all risk for the delivery of the notice of intent to the destination and by the deadline published in the public notice regardless of the method used. Applicants shall be given a written acknowledgment of receipt of the letter notice of intent which may include comments on the project if the intent shows a lack of understanding of program requirements. The administrator shall have the discretion to amend the letter notice of intent content requirements for any given grant application period.

Amend subrule 39.23(4), introductory paragraph and paragraphs "g" and "h," as follows:

39.23(4) State grant proposal. Applicants for the construction and start-up funds shall submit the proposal to the administrator on Form 470-2773, Application for Construction and Start-Up Grant Funds to Develop Community Living Arrangements for Homeless Persons with Mental Illness. If a proposal does not contain all the information specified in the application package including the original application and the required number of copies of the application or if it is received after the submittal deadline, the proposal shall be denied for review. The application content length shall not exceed 15 pages excluding appendices. Proposals that exceed these page limitations shall be denied for excluded from the competitive review process. Only hard copies of the application will be accepted. Facsimile and other non-hard-copy submittals shall be denied for review. The administrator shall have the discretion to amend the grant proposal content requirements for any given grant application period. Applications shall contain the following information:

g. A letter of endorsement from the planning council central point of coordination administrator of the county or counties in which the project will occur. This letter shall nominate the project for construction and start-up funding. For a statewide project, a letter is required only from the planning council central point of coordination administrator of the county of the applicant.

h. Six letters of support from agencies or individuals stating familiarity with the proposed project and substantiating the experience of the applicant to conduct the proposed project. These letters should be authored by a diverse group including professional or service provider organizations, local government and housing officials, advocates for persons to be served by the project, and service consumers and their family members. A minimum of one letter each must be from:

(1) individuals or organizations Consumer organizations or mental health service consumers that represent Iowa consumers of mental health services.

(2) and Family member organizations or individuals or organizations that represent family members of persons with mental illness.

Further amend subrule 39.23(4) by rescinding and reserving paragraph "p."

Amend subrule 39.23(6) as follows:

39.23(6) Notification. Notification of acceptance or denial of the proposal will be sent to each applicant within ten working days of receipt after the application due date.

ITEM 3. Amend rule 441--39.29(225C) as follows:

Amend subrule 39.29(1) as follows:

39.29(1) Applicants for the Stewart B. McKinney funds. The applicants for the Stewart B. McKinney Homeless Assistance Act funds include states, Indian tribes, metropolitan cities, public housing agencies, counties, governmental agencies, private nonprofit organizations, or community mental health organizations that are public nonprofit organizations. The United States Department of Housing and Urban Development (HUD) defines the requirements of all applications. In order to ensure that applicants that wish to use state funds to meet Stewart B. McKinney Homeless Assistance Act application match requirements meet the HUD and state criteria, the division shall screen all applications before endorsing them. Federal regulations and other state criteria pertaining to Stewart B. McKinney programs shall be the bases for the state's screening process.

Amend subrule 39.29(5), paragraphs "a" and "e," as follows:

a. A written letter of endorsement by the planning council central point of coordination administrator of the county(ies) in which the proposed project will occur. This letter shall nominate the applicant and project for consideration by the department.

e. A minimum of six letters of support from agencies or individuals stating familiarity with the proposed project and substantiating the experience of the applicant to conduct the proposed project. These letters should be authored by a diverse group including professional or service provider organizations, local government and housing officials, advocates for the population group, and service consumers and their family members. A minimum of one letter each must be from:

(1) individuals or organizations Consumer organizations or mental health service consumers that represent Iowa consumers of mental health services.

(2) and Family member organizations or individuals or organizations that represent family members of persons with mental illness.

ARC 7970A

The Council on Human Services adopted these amendments April 8, 1998. Notice of Intended Action regarding these amendments was published in the Iowa Administrative Bulletin on February 11, 1998, as ARC 7789A.

These amendments revise the statewide average cost to a private pay person for nursing care in Iowa and the average charges for nursing facility care, hospital-based skilled nursing care, non-hospital-based skilled nursing care, intermediate care facility for the mentally retarded (ICF/MR) care, mental health institute (MHI) care, and psychiatric medical institution for children (PMIC) care. The statewide average cost is used to determine the period of ineligibility when an applicant or recipient has transferred assets for less than fair market value. The statewide charge is used to determine whether a person who has established a medical assistance income trust qualifies for Medicaid.

A person in a nursing facility who transfers assets for less than fair market value to become eligible for Medicaid becomes ineligible for Medicaid for a period of time determined by dividing the uncompensated value of the transferred assets by the statewide average cost to a private pay person in order to arrive at the number of months of ineligibility for nursing facility services or home- and community-based waiver services.

Any person is allowed to establish a medical assistance income trust under Iowa Code section 633.709. For persons whose income exceeds 300 percent of the Supplemental Security Income (SSI) benefit for one person (currently $1,482) but whose income is below the statewide average charge or the average Medicaid reimbursement rate for the type of medical facility care the person needs, a medical assistance income trust may be used to establish Medicaid eligibility.

The Department is required to update these average statewide costs and charges annually. The statewide average cost used to determine the period of ineligibility for a person who transfers assets for less than fair market value is a costdetermined using all types of nursing facilities, including hospital-based and non-hospital-based skilled care.

The Department alternates updating the costs by conducting an actual survey one year and applying actual and projected increases the next year. A survey was conducted for fiscal year 1997. Actual and projected increases were applied for fiscal year 1998.

The average private pay cost increased from $2,415.08 to $2,567.77. The average charge to a private pay resident of nursing facility care increased from $2,255 to $2,397. The average charge for hospital-based skilled care increased from $7,232 per month to $7,471. The average charge for non-hospital-based skilled care increased from $3,554 to $3,671. The average charge for ICF/MR care increased from $8,030 to $8,319. The average statewide charge to a resident of a mental health institute increased from $9,704 to $9,975. The average charge of a psychiatric medical institution for children increased from $4,015 to $4,135.

These amendments are identical to those published under Notice of Intended Action.

These amendments are intended to implement Iowa Code section 249A.4.

These amendments shall become effective July 1, 1998.

The following amendments are adopted.

ITEM 1. Amend subrule 75.15(2), paragraph "b," as follows:

b. The average statewide cost to a private pay resident shall be determined by the department and updated annually for nursing facilities.

For the period from July 1, 1997 1998, through June 30, 1998 1999, this average statewide cost shall be $2,415.08 $2,567.77 per month or $79.40 $84.42 per day.

ITEM 2. Amend subrule 75.24(3), paragraph "b," introductory paragraphs and subparagraphs (1) to (6), as follows:

b. A trust established for the benefit of an individual if the trust is composed only of pension, social security, and other income to the individual (and accumulated income of the trust), and the state will receive all amounts remaining in the trust upon the death of the individual up to the amount equal to the total medical assistance paid on behalf of the individual.

For disposition of trust amounts pursuant to Iowa Code sections 633.707 to 633.711, the average statewide charges and Medicaid rates for the period from July 1, 1997 1998, to June 30, 1998 1999, shall be as follows:

(1) The average statewide charge to a private pay resident of a nursing facility is $2,255 $2,397 per month.

(2) The average statewide charge to a private pay resident of a hospital-based skilled nursing facility is $7,232 $7,471 per month.

(3) The average statewide charge to a private pay resident of a non-hospital-based skilled nursing facility is $3,554 $3,671 per month.

(4) The average statewide Medicaid rate for a resident of an intermediate care facility for the mentally retarded is $8,030 $8,319 per month.

(5) The average statewide charge to a resident of a mental health institute is $9,704 $9,975 per month.

(6) The average statewide charge to a private pay resident of a psychiatric medical institution for children is $4,015 $4,135 per month.

ARC 7971A

The Council on Human Services adopted these amendments April 8, 1998. Notice of Intended Action regarding these amendments was published in the Iowa Administrative Bulletin on February 11, 1998, as ARC 7806A.

These amendments implement the following changes in policy to the Home- and Community-Based (HCBS) MR and Brain Injury Waiver programs.

Policy governing both waiver programs is revised to:

* Clarify that in order for accreditation from another accrediting body to be used in lieu of an on-site review by the Department, the accreditation must be for a similar service.

* Clarify that interviews with consumers and significant people in the consumer's life are used only in on-site reviews for supported community living and supported employment services.

* Require only that respite providers meet the Organization Standard outcome and participate in satisfaction surveys for recertification. Respite services are a basicservice that requires some oversight, but conducting a full, outcome-based survey is not an efficient use of the provider's or surveyor's time. Overseeing the providers' governance and participant satisfaction surveys would provide the necessary oversight.

* Allow corrective actions to be required when issuing a three-year certification with excellence.

Policy for the HCBS MR waiver program is revised to provide that if a notice of decision is not received from a county within 30 days from the date of request for services for an adult with a county of legal settlement, the request shall be sent to the Department of Human Services with documentation verifying the original submission of the request to the county. A letter from the Department shall then be sent to the county central point of coordination and county board of supervisors requesting a response within ten days. If no response is received within ten days, the Division of Medical Services designee will decide whether or not to approve the services and service costs or request modification of the service plan or ICP.

Policy governing reimbursement for HCBS MR and brain injury providers of supported community living, nonfacility respite, and supported employment (except instructional activities to obtain a job and follow-along) waiver services is revised to clarify how rates will be set and to have a retrospective adjustment based on actual costs.

* Providers are reimbursed on the basis of a rate for a unit of service calculated prospectively for each participating provider (and, for supported community living daily rates, for each consumer or site) based on projected or historical costs of operation, subject to maximums and to retrospective adjustment based on actual, current costs of operation so as not to exceed reasonable and proper costs by more than 2.5 percent.

* Providers are required to submit cost reports for each waiver service provided using the Financial and Statistical Report for Purchase of Service and Supplemental Schedule. Costs reported under the waiver shall not be reported as reimbursable costs under any other funding source and costs incurred for other services shall not be reported as reimbursable costs under the waiver. Failure to maintain records to support the Financial and Statistical Report and Supplemental Schedule may result in termination of the provider's HCBS certification. Failure to submit the Financial and Statistical Report and Supplemental Schedule by September 30 or an extended deadline of up to 30 days granted by the Division of Medical Services shall reduce payment to the provider to 76 percent of the provider's current rate.

* General rate criteria which were inadvertently omitted in an earlier rule revision are reinstated, including a limit of 20 percent of other costs for indirect administrative costs and a limitation on consumer travel and transportation, consumer consulting, consumer instruction, consumer environmental modification and repairs and consumer environmental furnishing to $1,570 per consumer per year.

* The prospective rates for new providers who have not submitted six months of cost reports will be based on a projection of the provider's reasonable and proper costs of operation until the provider has submitted an annual cost report that includes a minimum of six months of actual costs. The prospective rates paid established providers who have submitted an annual report with a minimum of a six-month history will be based on reasonable and proper costs in a base period and are adjusted annually for inflation. The base period shall be the period covered by the first Financial and Statistical Report and Supplemental Schedule submitted to the Department after 1997 that includes at least six months of actual, historical costs. The annual adjustment shall be equal to the increase in the consumer price index for all urban consumers for the preceding 12-month period ending June 30.

* Retrospective adjustments shall be made based on reconciliation of provider's actual service costs with the revenues received for those services as reported on the Financial and Statistical Report and Supplemental Schedule. Revenues exceeding adjusted actual costs by more than 2.5 percent shall be remitted to the Division of Medical Services. Payment will be due upon notice of the new rates and retrospective adjustment. Providers who do not reimburse revenues exceeding 2.5 percent of actual costs 30 days after notice is given by the Department will have the revenues over 2.5 percent of the actual costs deducted from future payments.

* For purposes of determining the daily rate for supported community living services, providers are treated as new providers until they have submitted an annual report including at least six months of actual costs for the same consumers at the same site with no significant change in any consumer's needs. Individual prospective daily rates are determined for each consumer. These rates may be adjusted no more than once every three months if there is a vacancy at the site for over 30 days or a consumer's needs have significantly changed. Rates adjusted on this basis will become effective the month a new cost report is submitted. Retrospective adjustments of the prospective daily rates are based on each site's average costs.

These rate policies were developed by a committee consisting of representatives of county CPCs, providers, and Department staff. Revisions will enhance the accountability of providers as requested by counties. Making the rules consistent will assist consumers, providers, counties, and the state in planning for services.

Eight public hearings were held around the state. Seven persons attended. Most persons had questions regarding how the changes would work rather than comments. These amendments are identical to those published under Notice of Intended Action.

These amendments are intended to implement Iowa Code section 249A.4.

These amendments shall become effective July 1, 1998.

The following amendments are adopted.

ITEM 1. Amend subrule 77.37(12) as follows:

Amend paragraph "b," introductory paragraph, as follows:

b. Recertification. After the initial certification, the level of certification shall be based on an on-site review unless the provider has been accredited for similar services by the Joint Commission on Accreditation of Healthcare Organizations (JCAHO), the Council on Accreditation of Rehabilitation Facilities (CARF), the Council on Quality and Leadership in Supports for People with Disabilities (The Council), or the Council on Accreditation of Services for Families and Children (COA). The on-site reviews for supported community living and supported employment use interviews with consumers and significant people in the consumer's life to determine whether or not the 20 individual value-based outcomes set forth in subrules 77.37(1) and 77.37(2) and corresponding processes are present for the consumer. Respite services are required to meet Outcome 1 and participate in satisfaction surveys.

Amend paragraph "c," subparagraph (1), as follows:

(1) Three-year certification with excellence. An organization is eligible for certification with excellence if the number of processes present is 18 or higher and the number of outcomes and corresponding processes present together are is 12 or higher. Both criteria need to be met to receive three-year certification with excellence. No corrective action plan or follow-up monitoring is required. Correctiveactions may be required which may be monitored through the assignment of follow-up monitoring either by written report, a plan of corrective actions and improvements, an on-site review, or the provision of technical assistance.

ITEM 2. Amend subrule 77.39(10) as follows:

Amend paragraph "b," introductory paragraph, as follows:

b. Recertification. After the initial certification, the level of certification shall be based on an on-site review unless the provider has been accredited for similar services by the Joint Commission on Accreditation of Healthcare Organizations (JCAHO), the Council on Accreditation of Rehabilitation Facilities (CARF), the Council on Quality and Leadership in Supports for People with Disabilities (The Council), or the Council on Accreditation of Services for Families and Children (COA). The on-site reviews for supported community living and supported employment use interviews with consumers and significant people in the consumer's life to determine whether or not the 20 individual value-based outcomes set forth in subrules 77.39(1) and 77.39(2) and corresponding processes are present for the consumer. Respite services are required to meet Outcome 1 and participate in satisfaction surveys.

Amend paragraph "c," subparagraph (1), as follows:

(1) Three-year certification with excellence. An organization is eligible for certification with excellence if the number of processes present is 18 or higher and the number of outcomes and corresponding processes present together are is 12 or higher. Both criteria need to be met to receive three-year certification with excellence. No corrective action plan or follow-up monitoring is required. Correctiveactions may be required which may be monitored through the assignment of follow-up monitoring either by written report, a plan of corrective actions and improvements, an on-site review, or the provision of technical assistance.

ITEM 3. Amend rule 441--79.1(249A) as follows:

Amend subrule 79.1(1) by inserting the following new paragraphs "e" and "f":

e. Retrospectively limited prospective rates. Providers are reimbursed on the basis of a rate for a unit of service calculated prospectively for each participating provider (and, for supported community living daily rates, for each consumer or site) based on projected or historical costs of operation, subject to the maximums listed in subrule 79.1(2) and to retrospective adjustment based on actual, current costs of operation so as not to exceed reasonable and proper costs by more than 2.5 percent.

The prospective rates for new providers who have not submitted six months of cost reports will be based on a projection of the provider's reasonable and proper costs of operation until the provider has submitted an annual cost report that includes a minimum of six months of actual costs. The prospective rates paid established providers who have submitted an annual report with a minimum of a six-month history are based on reasonable and proper costs in a base period and are adjusted annually for inflation. The prospective rates paid to both new and established providers are subject to the maximums listed in subrule 79.1(2) and to retrospective adjustment based on the provider's actual, current costs of operation as shown by financial and statistical reports submitted by the provider, so as not to exceed reasonable and proper costs actually incurred by more than 2.5 percent.

f. Contractual rate. Providers are reimbursed on a basis of costs incurred pursuant to a contract between the provider and subcontractor.

Amend subrule 79.1(2), provider category of HCBS brain injury waiver service providers--supported community living, respite care, and supported employment providers, as follows:

Provider category	Basis of reimbursement	Upper limit
HCBS brain injury waiver service providers, including:
1. Supported community living	Fee schedule determined per day per month. See 79.1(17) Retrospectively limited prospective rates. See 79.1(15)	$32 per hour, $72.17 per day. Variance may be granted when cost-effective and in accordance with the ICP.
	Fee schedule determined per hour. See 79.1(17)	$32 per hour.
2. Respite care providers, including:
Nonfacility care:	Fee schedule Retrospectively limited prospective rates. See 79.1(15)	$12 per hour, $104 per 4- to 8-hour day
Facility care:
Hospital or skilled nursing facility	Prospective reimbursement	Limit for skilled nursing facility level of care
Nursing facility or inter- mediate care facility for the mentally retarded	Prospective reimbursement	Limit for nursing facility level of care
Foster group care	Prospective reimbursement	P.O.S. contract rate
5. Supported employ- ment:
a. Instructional activities to obtain a job	Fee schedule See 79.1(17)	$34.02 per day
b. Initial instruction-al activities on the job	Fee schedule See 79.1(17) Retrospectively limited prospective rates. See 79.1(15)	$15.46 per hour
c. Enclave	Fee schedule See 79.1(17) Retrospectively limited prospective rates. See 79.1(15)	$5.67 per hour
d. Follow- along	Fee schedule See 79.1(17)	$257.75 per month

Further amend subrule 79.1(2), provider category of HCBS MR waiver service providers--supported community living, respite care, supported employment, and home and vehicle modifications providers, as follows:

Provider category	Basis of reimbursement	Upper limit
HCBS MR waiver service providers, including:
1. Supported community living	Prospective cost-related reimbursement determined per day per month. Retrospectively limited prospective rates. See 79.1(15)	$32 per hour, not to exceed a total per month of $72.17 times the number of days in the month. $72.17 per day. Variations to the upper limit may be granted by the division of medical services when cost-effective and in accordance with the ICP or service plan as long as the statewide average remains at or below $72.17 per day.
	Prospective cost-related reimbursement determined per hour. See 79.1(15)	$32 per hour not to exceed a total per month of $72.17 times the number of days in the month. Variations may be granted by the division of medical services when cost-effective and in accordance with the ICP or service plan as long as the statewide average remains at or below $72.17 per day.
2. Respite care providers, including:
Nonfacility care:	Prospective cost-related reimbursement Retrospectively limited prospective rates. See 79.1(15)	$12 per hour
Facility care:
Hospital or skilled nursing facility	Prospective reimbursement	Limit for skilled nursing facility level of care
Nursing facility or intermediate care facility for the mentally retarded	Prospective reimbursement	Limit for nursing facility level of care
Foster group care	Prospective reimbursement	P.O.S. contract rate
3. Supported employment:
a. Instructional activities to obtain a job	Fee schedule See 79.1(15)	$34.02 per day. Maximum of 80 units, 5 per week, limit 16 weeks
b. Initial instructional activities on the job	Prospective cost- related reimbursement Retrospectively limited prospective rates. See 79.1(15)	$15.46 per hour. Maximum of 40 units per week, limit 16 weeks, 640 units
c. Enclave	Prospective cost- related reimbursement Retrospectively limited prospective rates. See 79.1(15)	$5.67 per hour. Maximum of 40 units per week
d. Follow-along	Fee schedule See 79.1(15)	$257.75 per month. Maximum of 12 units per fiscal year or $8.45 per day for a partial month.
7. Home and vehicle modifications	Fee schedule Contractual rate. See 79.1(15)	Maximum amount of $5,000 per consumer through 2/28/95 lifetime

Rescind subrules 79.1(15) and 79.1(17) and insert the following new subrules in lieu thereof:

79.1(15) Reimbursement for HCBS MR and BI supported community living, respite, and supported employment.

a. Reporting requirements.

(1) Providers shall submit cost reports for each waiver service provided using Form SS-1703-0, Financial and Statistical Report for Purchase of Service, and Form 470-3449, Supplemental Schedule. The cost reporting period is from July 1 to June 30. The completed cost reports shall be submitted to the department, division of medical services, by September 30 of each year.

(2) If a provider chooses to leave the HCBS program or terminates a service, a final cost report shall be submitted within 60 days of termination for retrospective adjustment.

(3) Costs reported under the waiver shall not be reported as reimbursable costs under any other funding source. Costs incurred for other services shall not be reported as reimbursable costs under the waiver.

(4) Financial information shall be based on the agency's financial records. When the records are not kept on an accrual basis of accounting, the provider shall make the adjustments necessary to convert the information to an accrual basis for reporting. Providers which are multiple program agencies shall submit a cost allocation schedule, prepared in accordance with generally accepted accounting principles.

(5) Failure to maintain records to support the cost reports may result in termination of the provider's HCBS certification.

(6) The department may require that an opinion of a certified public accountant or public accountant accompany the report when adjustments made to prior reports indicate noncompliance with reporting instructions.

(7) A 30-day extension for submitting the cost reports due by September 30 may be obtained by submitting a letter to the division of medical services by September 30. No extensions will be granted beyond 30 days.

(8) Failure to submit a report that meets the requirements of this paragraph by September 30 or an extended deadline granted per subparagraph (7) shall reduce payment to 76 percent of the current rate. The reduced rate shall be paid for not longer than three months, after which time no further payments will be made.

b. Home- and community-based general rate criteria.

(1) To receive reimbursement for services, a certified provider shall enter into an agreement with the department on Form 470-2918, HCBS Waiver Agreement, and have an approved individual comprehensive plan for the consumer.

(2) The rates a provider may charge are subject to limits established in subrule 79.1(2).

(3) Indirect administrative costs shall be limited to 20 percent of other costs.

(4) Mileage costs shall be reimbursed according to state employee rate.

(5) Consumer travel and transportation, consumer consulting, consumer instruction, consumer environmental modification and repairs and consumer environmental furnishings shall not exceed $1,570 per consumer per year.

c. Prospective rates for new providers.

(1) Providers who have not submitted an annual report including at least 6 months of actual, historical costs shall be paid prospective rates based on projected reasonable and proper costs of operation for a 12-month period reported in Form SS-1703-0, Financial and Statistical Report, and Form 470-3449, Supplemental Schedule.

(2) Prospective rates shall be subject to retrospective adjustment as provided in paragraph "e."

(3) After a provider has submitted an annual report including at least six months of actual, historical costs, prospective rates shall be determined as provided in paragraph "d."

d. Prospective rates for established providers.

(1) Providers who have submitted an annual report including at least six months of actual, historical costs shall be paid prospective rates based on reasonable and proper costs in a base period, as adjusted for inflation.

(2) The base period shall be the period covered by the first Form SS-1703-0, Financial and Statistical Report, and Form 470-3449, Supplemental Schedule, submitted to the department after 1997 that includes at least six months of actual, historical costs.

(3) Reasonable and proper costs in the base period shall be inflated by a percentage of the increase in the consumer price index for all urban consumers for the preceding 12-month period ending June 30, based on the months included in the base period, to establish the initial prospective rate for an established provider.

(4) After establishment of the initial prospective rate for an established provider, the rate will be adjusted annually, effective for the third month after the month during which the annual cost report is submitted to the department. The annual adjustment shall be equal to the increase in the consumer price index for all urban consumers for the preceding 12-month period ending June 30.

(5) Prospective rates shall be subject to retrospective adjustment as provided in paragraph "e."

e. Retrospective adjustments.

(1) Retrospective adjustments shall be made based on reconciliation of provider's reasonable and proper actual service costs with the revenues received for those services as reported on Form 470-3449, Supplemental Schedule, accompanying Form SS-1703-0, Financial and Statistical Report for Purchase of Service.

(2) Revenues exceeding adjusted actual costs by more than 2.5 percent shall be remitted to the division of medical services. Payment will be due upon notice of the new rates and retrospective adjustment.

(3) Providers who do not reimburse revenues exceeding 2.5 percent of actual costs 30 days after notice is given by the department will have the revenues over 2.5 percent of the actual costs deducted from future payments.

f. Supported community living daily rate. For purposes of determining the daily rate for supported community living services, providers are treated as new providers until they have submitted an annual report including at least six months of actual costs for the same consumers at the same site with no significant change in any consumer's needs, or if there is a subsequent change in the consumers at a site or in any consumer's needs. Individual prospective daily rates are determined for each consumer. These rates may be adjusted no more than once every three months if there is a vacancy at the site for over 30 days or the consumer's needs have significantly changed. Rates adjusted on this basis will become effective the month a new cost report is submitted. Retrospective adjustments of the prospective daily rates are based on each site's average costs.

79.1(17) Reimbursement for home- and community-based services home and vehicle modification. Payment is made for home and vehicle modifications at the amount of payment to the subcontractor provided in the contract between the supported community living provider and subcontractor. All contracts shall be awarded through competitive bidding, shall be approved by the department, and shall be justified by the consumer's service plan. Payment for completed work shall be made to the supported community living provider.

ITEM 4. Amend subrule 83.67(9) by adding the following new paragraph "d":

d. If a notice of decision is not received from a county within 30 days from the date of request for services, the request shall be sent to the department of human services with documentation verifying the original submission of the request to the county. A letter from the department of human services shall be sent to the county central point of coordination and county board of supervisors requesting a response within ten days. If no response is received within ten days, the division of medical services designee will make the decision as stated in paragraph "b."

ARC 7972A

The Council on Human Services adopted these amendments April 8, 1998. These amendments combine three Notices of Intended Action. Notices of Intended Action regarding these amendments were published in the Iowa Administrative Bulletin on February 11, 1998, as ARC 7790A and ARC 7807A, and on February 25, 1998, as ARC 7841A.

* The amendments noticed as ARC 7790A modify Medicaid home health agency policy as follows:

[zeta] The maximum time for review of the treatment plan and certification period is increased from 60 to 62 days to be consistent with Medicare.

[zeta] Policy is added to clarify the definition oftechnology-dependent children. Children who are technology dependent are those who are ventilator dependent or whose medical condition is so unstable as to otherwise require intensive care in a hospital. Providers were confused at which level children met the medical necessity of technology dependent for the enhanced payment which is available.

[zeta] Policy is clarified that transportation and homework assistance are not home health services.

* The amendments noticed as ARC 7807A remove the prior authorization requirement for Medicaid approval for two dental procedures, oral prophylaxis and post supports, and remove the lower age limit for payment of pit and fissure sealants for first and second permanent molars for children through the age of 15. In addition, language is revised to be more precise.

Prior approval is no longer needed when the oral prophylaxis, including necessary scaling and polishing, is to be performed more frequently than every six months. Cast post and core, steel post and composite or amalgam in addition to a crown is payable when a tooth is functional and the integrity of the tooth would be jeopardized by no post support. Policy is being revised as the prior authorizations are no longer cost-effective and a court ruling declared the prosthetic services rule to be arbitrary and capricious.

Current policy limits payment for sealants to children aged 5 through 15. This policy is being revised in response to a petition for rule making from the Iowa Dental Association.

* The amendments noticed as ARC 7841A revise the prior authorization requirements for nonsedating antihistamines. The number of unsuccessful trials on a sedating antihistamine required for prior authorization for a nonsedating antihistamine to be approved is lowered from two to one for persons 20 years of age and younger.

This change was suggested by medical professionals and others and approved by the Medicaid Drug Utilization Review Commission as being more representative of current medical practice.

These amendments are identical to those published under Notice of Intended Action.

These amendments are intended to implement Iowa Code section 249A.4.

These amendments shall become effective July 1, 1998.

The following amendments are adopted.

ITEM 1. Amend subrule 78.1(2), paragraph "a," subparagraph (3), twenty-first unnumbered paragraph, as follows:

Prior authorization is required for all nonsedating antihistamines. Patients 21 years of age and older must have received two unsuccessful trials with other covered antihistamines (chlorpheniramine or diphenhydramine) or unless evidence must be is provided that the use of these agents would be medically contraindicated, prior to the utilization of the nonsedating antihistamines. Patients 20 years of age and younger must have received one unsuccessful trial with another covered antihistamine (chlorpheniramine or diphenhydramine) unless evidence is provided that the use of these agents would be medically contraindicated, prior to the utilization of the nonsedating antihistamines. (Cross-reference 78.28(1)"d"(7))

ITEM 2. Amend rule 441--78.4(249A) as follows:

Amend subrule 78.4(1), paragraphs "a" and "c," as follows:

a. Oral prophylaxis, including necessary scaling and polishing, is payable only once in a six-month period except for persons who, because of physical or mental disability, need more frequent care. Prior approval is required in all cases where the oral prophylaxis is to be performed morefrequently than every six months. (Cross-reference 78.28(2)"a") Documentation supporting the need for oral prophylaxis performed more than once in a six-month period must accompany the claim.

c. Pit and fissure sealants are payable for placement on first and second permanent molars only. Reimbursement for sealants is restricted to work performed on children aged 5 through 15 years of age for first and second permanent molars. Payment will be approved for only one application per tooth in a child's lifetime.

Amend subrule 78.4(3), paragraph "e," as follows:

e. Cast post and core, steel post and composite or amalgam in addition to a crown require prior approval. Approval will be given is payable when a tooth is functional and the integrity of the tooth would be jeopardized by no post support. (Cross-reference 78.28(2)"b")

Amend subrule 78.4(4), paragraph "d," as follows:

d. Periodontal maintenance therapy which includes oral prophylaxis, oral examinations, measurement of pocket depths and limited root planing and scaling is a payable service when prior approval has been received. A request for approval must be accompanied by a plan for treatment periodontal treatment plan, a completed copy of a periodontal probe chart which exhibits pocket depths, periodontal history and radiograph(s). Payment for periodontal maintenance therapy will may be approved when after periodontal scaling and root planing and or periodontal surgical procedures have been provided. Periodontal maintenance therapy will may be approved for three visits at once per three-month intervals following treatment interval for moderate to advanced cases. Periodontal maintenance therapy may then be approved once per six-month interval if the patient's condition is getting worse or, if not maintained, conditions would deteriorate without treatment. (Cross-reference 78.28(2)"c" "a"(3))

Amend subrule 78.4(7) as follows:

78.4(7) Prosthetic services. Payment will may be made for the following prosthetic services:

a. Immediate dentures An immediate denture and a first-time complete dentures denture including six months' postdelivery care. An immediate denture and a first-time complete denture are payable when the dentures are denture is provided to establish masticatory function. An immediate denture or a first-time complete denture is payable only once following the removal of teeth it replaces. Complete dentures are A complete denture is payable only once in a five-year period except when the dentures are denture is broken beyond repair, lost or stolen, or no longer fit fits due to growth in a child or changes in jaw structure and is required to prevent significant dental problems.

b. Partial dentures A removable partial denture replacing anterior teeth, including six months' postdelivery care. Partial dentures A removable partial denture replacing anterior teeth are is only payable once in a five-year period unless the dentures are removable partial denture is broken beyond repair, lost or stolen, or no longer fit fits due to growth in a child, or changes in jaw structure and are is required to prevent significant dental problems.

c. Partial dentures A removable partial denture replacing posterior teeth including six months' postdelivery care when prior approval has been received. Prior approval requests will A removable partial denture replacing posterior teeth shall be approved when the patient recipient has less fewer than eight posterior teeth in occlusion; or when the patient's missing teeth could cause shifting or supra eruption of the remaining dentition; or the patient recipient has a full denture in one arch, and a partial denture replacing posterior teeth is required in the opposing arch in order to balance occlusion; or a partial denture replacing anterior teeth is being approved, and posterior teeth can be replaced with little additional cost. When one removable partial denture brings eight posterior teeth in occlusion, no additional removable partial denture will be approved. Partial dentures A removable partial denture replacing posterior teeth are is payable only once in a five-year period unless the dentures are removable partial denture is broken beyond repair, lost or stolen, or no longer fit fits due to growth in a child, or changes in jaw structure and are is required to prevent significant dental problems. (Cross-reference 78.28(2)"e" "c"(1))

d. Fixed bridgework A fixed partial denture (including an acid etch bridgework fixed partial denture) for missing replacing anterior teeth when prior approval has been received. Fixed bridgework A fixed partial denture (including an acid etch fixed partial denture) for missing replacing anterior teeth shall be approved for recipients whose medical condition precludes the use of a removable prostheses partial denture. High noble or noble metals shall be approved only when the recipient is allergic to all other restorative materials. A fixed partial denture replacing anterior teeth is payable only once in a five-year period unless the fixed partial denture is broken beyond repair. (Cross-reference 78.28(2)"e" "c"(2))

e. A fixed partial denture (including an acid etch fixed partial denture) replacing posterior teeth when prior approval has been received. A fixed partial denture (including an acid etch fixed partial denture) replacing posterior teeth shall be approved for a recipient whose medical condition precludes the use of a removable partial denture and who has fewer than eight posterior teeth in occlusion or if the recipient has a full denture in one arch and a partial denture replacing posterior teeth is required in the opposing arch to balance occlusion. When one fixed partial denture brings eight posterior teeth in occlusion, no additional fixed partial denture will be approved. High noble or noble metals will be approved only when the recipient is allergic to all other restorative materials. A fixed partial denture replacing posterior teeth is payable only once in a five-year period unless the fixed partial denture is broken beyond repair. (Cross-reference 78.28(2)"c"(3))

e f. Obturator for surgically excised palatal tissue or deficient velopharyngeal function of cleft palate patients.

f g. Chairside relines are payable only once per appliance prosthesis every 12 months.

g h. Laboratory processed relines are payable only once per appliance prosthesis every 12 months.

h i. Tissue conditioning is a payable service twice per appliance prosthesis in a 12-month period.

i j. Two repairs per appliance prosthesis in a 12-month period are payable.

j k. Adjustments to dentures a complete or removable partial denture are payable when medically necessary after six months' postdelivery care.

Amend subrule 78.4(8), paragraph "a," last paragraph, as follows:

Approval may be made for eight units of a three-month active treatment period. Additional units may be approved by the fiscal agent's orthodontic consultant if found to be medically necessary. (Cross-reference 78.28(2)"f" "d")

ITEM 3. Amend rule 441--78.9(249A) as follows:

Amend subrule 78.9(1), introductory paragraph and paragraph "j," as follows:

78.9(1) Treatment plan. A plan of treatment shall be completed prior to the start of care and at a minimum reviewed every 60 62 days thereafter. The plan of care shall support the medical necessity and intensity of services to be provided by reflecting the following information:

j. Certification period (no more than 60 62 days).

Amend subrule 78.9(10), paragraph "a," subparagraph (1), as follows:

(1) Private duty nursing services are those services which are provided by a registered nurse or a licensed practical nurse under the direction of the recipient's physician to a recipient in the recipient's place of residence or outside the recipient's residence, when normal life activities take the recipient outside the place of residence. Place of residence does not include nursing facilities, skilled nursing facilities, intermediate care facilities for the mentally retarded, or hospitals.

Services shall be provided according to a written plan of care authorized by a licensed physician. The home health agency is encouraged to collaborate with the recipient, or in the case of a child with the child's caregiver, in the development and implementation of the plan of treatment. These services shall exceed intermittent guidelines as defined in subrule 78.9(3). Private duty nursing and personal care services shall be inclusive of all home health agency services personally provided to the recipient. Enhanced payment under the interim fee schedule shall be made available for services to children who are technology dependent, i.e., ventilator dependent or whose medical condition is so unstable as to otherwise require intensive care in a hospital.

Private duty nursing or personal care services do not include:

1. Respite care, which is a temporary intermission or period of rest for the caregiver.

2. Nurse supervision services including chart review, case discussion or scheduling by a registered nurse.

3. Services provided to other members of the recipient's household.

4. Services requiring prior authorization that are provided without regard to the prior authorization process.

5. Transportation services.

6. Homework assistance.

ITEM 4. Amend rule 441--78.28(249A) as follows:

Amend subrule 78.28(1), paragraph "d," subparagraph (7), as follows:

(7) Prior authorization is required for all nonsedating antihistamines. Patients 21 years of age and older must have received two unsuccessful trials with other covered antihistamines (chlorpheniramine or diphenhydramine) or unless evidence must be is provided that the use of these agents would be medically contraindicated, prior to the utilization of the nonsedating antihistamines. Patients 20 years of age and younger must have received one unsuccessful trial with another covered antihistamine (chlorpheniramine or diphenhydramine) unless evidence is provided that the use of these agents would be medically contraindicated, prior to the utilization of the nonsedating antihistamines.

Amend subrule 78.28(2) as follows:

78.28(2) Dental services. Dental services which require prior approval are as follows:

a. Oral prophylaxis, including necessary scaling and polishing, is payable only once in a six-month period except for persons who because of physical or mental disability need more frequent care. Prior authorization is required in all cases where the oral prophylaxis is to be performed more frequently than every six months. (Cross-reference 78.4(1)"a")

b. Cast post and core, steel post and composite or amalgam in addition to a crown will be approved when a tooth is functional and the integrity of the tooth would be jeopardized by no post support. (Cross-reference 78.4(3)"e")

c a. The following periodontal services:

(1) Payment for periodontal scaling and root planing will be approved when interproximal and subgingival calculus is evident in X-rays or when justified and documented that curettage, scaling or root planing is required in addition to routine prophylaxis. (Cross-reference 78.4(4)"b")

(2) Payment for periodontal surgical procedures will be approved after periodontal scaling and root planing has been provided, a reevaluation examination has been completed, and the patient has demonstrated reasonable oral hygiene, unless the patient is unable to demonstrate reasonable oral hygiene because of physical or mental disability or in cases which demonstrate gingival hyperplasia resulting from drug therapy. (Cross-reference 78.4(4)"c")

(3) Payment for periodontal maintenance therapy will may be approved when after periodontal scaling and root planing and or periodontal surgical procedures have been provided. Periodontal maintenance therapy will may be approved for three visits at once per three-month intervals interval following treatment for moderate to advanced cases. Periodontal maintenance therapy may then be approved once per six-month interval if the patient's condition is getting worse or, if not maintained, conditions would deteriorate without treatment. (Cross-reference 78.4(4)"d")

d b. Surgical endodontic treatment which includes an apicoectomy, performed as a separate surgical procedure; an apicoectomy, performed in conjunction with endodontic procedure; an apical curettage; a root resection; or excision of hyperplastic tissue will be approved when nonsurgical treatment has been attempted and a reasonable time has elapsed after which failure has been demonstrated. Surgical endodontic procedures may be indicated when:

(1) Conventional root canal treatment cannot be successfully completed because canals cannot be negotiated, debrided or obturated due to calcifications, blockages, broken instruments, severe curvatures, and dilacerated roots.

(2) Correction of problems resulting from conventional treatment including gross underfilling, perforations, and canal blockages with restorative materials. (Cross-reference 78.4(5)"c")

e c. The following prosthetic services:

(1) Partial dentures A removable partial denture replacing posterior teeth will be approved when the patient recipient has less fewer than eight posterior teeth in occlusion; or when the patient's missing teeth could cause shifting or supra eruption of the remaining dentition; or the patient recipient has a full denture in one arch, and a partial denture replacing posterior teeth is required in the opposing arch in order to balance occlusion; or a partial denture replacing anterior teeth is being approved, and posterior teeth can be replaced with little additional cost. When one removable partial denture brings eight posterior teeth in occlusion, no additional removable partial denture will be approved. Partial dentures A removable partial denture replacing posterior teeth are is payable only once in a five-year period unless the dentures are removable partial denture is broken beyond repair, lost or stolen, or no longer fit fits due to growth in a child or changes in jaw structure, and are is required to prevent significant dental problems. (Cross-reference 78.4(7)"d" "c")

(2) Fixed bridgework A fixed partial denture (including an acid etch bridgework fixed partial denture) for missing replacing anterior teeth will be approved for recipients whose medical condition precludes the use of a removable prostheses partial denture. High noble or noble metals will be approved only when the recipient is allergic to all other restorative materials. A fixed partial denture replacing anterior teeth is payable only once in a five-year period unless the fixed partial denture is broken beyond repair. (Cross-reference 78.4(7)"e" "d")

(3) A fixed partial denture (including an acid etch fixed partial denture) replacing posterior teeth will be approved for recipients whose medical condition precludes the use of a removable partial denture and who have fewer than eight posterior teeth in occlusion or if the recipient has a full denture in one arch and a partial denture replacing posterior teeth is required in the opposing arch to balance occlusion. When one fixed partial denture brings eight posterior teeth in occlusion, no additional fixed partial denture will be approved. High noble or noble metals will be approved only when the recipient is allergic to all other restorative materials. A fixed partial denture replacing posterior teeth is payable only once in a five-year period unless the fixed partial denture is broken beyond repair. (Cross-reference 78.4(7)"e")

f d. Orthodontic services will be approved when it is determined that a patient has the most handicapping malocclusion. This determination is made in a manner consistent with the "Handicapping Malocclusion Assessment to Establish Treatment Priority," by J. A. Salzmann, D.D.S., American Journal of Orthodontics, October 1968.

A handicapping malocclusion is a condition that constitutes a hazard to the maintenance of oral health and interferes with the well-being of the patient by causing impaired mastication, dysfunction of the temporomandibular articulation, susceptibility to periodontal disease, susceptibility to dental caries, and impaired speech due to malpositions of the teeth. Treatment of handicapping malocclusions will be approved only for the severe and the most handicapping. Assessment of the most handicapping malocclusion is determined by the magnitude of the following variables: degree of malalignment, missing teeth, angle classification, overjet and overbite, openbite, and crossbite.

A request to perform an orthodontic procedure must be accompanied by an interpreted cephalometric radiograph and study models trimmed so that the models simulate centric occlusion of the patient. A written plan of treatment must accompany the diagnostic aids. Posttreatment records must be furnished upon request of the fiscal agent.

Approval may be made for eight units of a three-month active treatment period. Additional units may be approved by the fiscal agent's orthodontic consultant if found to be medically necessary. (Cross-reference 78.4(8)"a")

ARC 7973A

The Council on Human Services adopted these amendments April 8, 1998. Notice of Intended Action regarding these amendments was published in the Iowa Administrative Bulletin on February 11, 1998, as ARC 7829A.

These amendments make the following changes to operation of the Medicaid managed care program required by the Balanced Budget Act (BBA) of 1997:

* The definition of emergency care is revised to mean those medical services rendered for an emergent medical condition or protection of the public health. "Emergent medical condition" is defined to mean a medical condition manifesting itself by acute symptoms of sufficient severity (including severe pain) such that a prudent layperson, who possesses an average knowledge of health and medicine, could reasonably expect it to result in:

1. Placing the health of the person (or, with respect to a pregnant woman, the health of the woman or her unborn child) in serious jeopardy,

2. Serious impairment to bodily functions, or

3. Serious dysfunction of any bodily organ or part.

The determination of whether an emergent medical condition exists shall be decided by a medical professional and shall be based on the patient's medical condition, including presenting symptoms and medical history (as related to severe pain) prior to treatment.

In cases where the above criteria are satisfied, no prior authorization procedures are allowed.

* A change in existing marketing rules was made to match the requirements of the BBA.

* Policy requiring the total number of enrolled Medicaid recipients and Part A and Part B Medicare beneficiaries not to exceed 75 percent of the nonfederally qualified HMO's total enrollment is deleted.

* The following definitions have been adapted from the BBA: "extended plan participation," "managed care entity," "mandatory enrollment," and "mandatory project county."

In addition, these amendments make the following changes to operation of the Medicaid managed care program which are not required by the Balanced Budget Act (BBA) of 1997:

* Due to increased frequency of managed care provider's developing proprietary definitions of "urgent care," the need arose for the Department to develop a standard definition to ensure that recipients' best interests are protected across all managed care programs. The definition of urgent care is revised to mean those medical services rendered for an urgent medical condition or protection of the public health. "Urgent medical condition" shall mean a medical condition manifesting itself by acute symptoms that are of lesser severity (including severe pain) than that recognized for an emergent medical condition, such that a prudent lay-person, who possesses an average knowledge of health and medicine, could reasonably expect the illness or injury to result in:

1. Placing the health of the individual (or, with respect to a pregnant woman, the health of the woman or her unborn child) in jeopardy,

2. Impairment to bodily functions, or

3. Dysfunction of any bodily organ or part.

In urgent medical care cases, prior authorization procedures must be followed, but the HMO or patient manager is required to arrange for necessary urgent medical care within 24 hours by either providing it or referring to and authorizing another appropriate provider to provide care.

* Policy regarding enrollment periods is revised. Under current policy, if a recipient in a mandatory project county (a county where the Department has contracts with more than one managed care entity) does not select an entity in ten days, the Department will automatically enroll the recipient in the entity. The recipient may then request to be disenrolled at any time and the disenrollment is effective no later than the first day of the second month subsequent to the date the Department receives the request.

The Balanced Budget Act of 1997 gives states the option of requiring that the recipient remain in managed care for a period of 12 months if the recipient is given a 90-day period to request disenrollment after being notified of placement in managed care and if the recipient does not have good cause to terminate enrollment. The Department has chosen to require recipients who do not request disenrollment in the 90-day period to remain in managed care for a period of six months. At the end of this nine-month cycle, a new notice is sent to the recipient, and the process repeats itself.

* In order to achieve statewide coverage by HMOs, current rules specify that an HMO must serve all counties in a region. Due to unforeseeable issues (such as statewide licensing requirements or provider availability) this requirement could not be fulfilled. Therefore, the Department is amending the requirements to delete the mandatory coverage of all counties in a region by redefining the enrollment area. To continue encouraging wide geographic coverage, these rules allow incentive reimbursement payments based on the percentage of counties in a region covered by an HMO.

Eight public hearings were held around the state. Three persons attended. Written comments were received from the Association of Iowa Hospitals and Health Systems, Iowa Medical Society, Iowa Nurses Association, and John Deere Health Care. The following revisions were made to the Notice of Intended Action:

Rules 441--88.1(249A) and 88.41(249A) were revised to clarify the definition of "Mandatory project county."

These amendments are intended to implement Iowa Code section 249A.4.

These amendments shall become effective July 1, 1998.

The following amendments are adopted.

ITEM 1. Amend rule 441--88.1(249A), definitions of "Emergency care," "Enrollment area," and "Urgent care," as follows:

"Emergency care" shall mean those medical services rendered under unforeseen conditions which require hospitalization or the treatment of accidental injury, relief of acute pain, for an emergent medical condition or protection of the public health or a condition which must be immediately diagnosed and treated to avoid risk of permanent damage to the patient's health.

"Enrollment area" shall mean the county or counties or region or regions in which an HMO is licensed to operate by the state of Iowa and in which service capability exists as defined by the department and set forth in the contract. An enrollment area shall not be less than an entire county or but may be less than a region. Effective July 1, 1998, an enrollment area shall be no less than a region or regions. Regions shall be established by the department and outlined in the contract with the HMO.

"Urgent care" shall mean those medical services necessary for conditions that are not life threatening but which require treatment which cannot wait for a regularly scheduled clinical appointment because of the prospect of the conditions worsening without timely medical intervention rendered for an urgent medical condition or protection of the public health.

Further amend rule 441--88.1(249A) by adding the following new definitions in alphabetical order:

"Emergent medical condition" shall mean a medical condition manifesting itself by acute symptoms of sufficient severity (including severe pain) such that a prudent layperson, who possesses an average knowledge of health and medicine, could reasonably expect it to result in:

1. Placing the health of the person (or, with respect to a pregnant woman, the health of the woman or her unborn child) in serious jeopardy,

2. Serious impairment to bodily functions, or

3. Serious dysfunction of any bodily organ or part.

The determination of whether an emergent medical condition exists shall be decided by a medical professional and shall be based on the patient's medical condition, including presenting symptoms and medical history (as related to severe pain) prior to treatment.

In cases where the above criteria are satisfied, no prior authorization procedures are allowed.

"Extended-participation program" shall mean a mandatory six-month enrollment period with a managed care entity.

"Managed care entity" shall mean either a managed care organization licensed by the department of insurance (e.g., HMO or PHP) or a primary care case management program (i.e., MediPASS).

"Mandatory enrollment" shall mean mandatory participation in managed health care as specified in subrule 88.3(3).

"Mandatory project county" shall mean a county where the department has contracts with more than one managed care entity, one of which may be primary care case management (MediPASS) in cases where the number of MediPASS providers willing to serve as patient managers is sufficient to meet the needs and makeup of the recipient population in the county, or where the department has implemented the MediPASS program alone in the county.

"Urgent medical condition" shall mean a medical condition manifesting itself by acute symptoms that are of lesser severity (including severe pain) than that recognized for an emergent medical condition, such that a prudent layperson, who possesses an average knowledge of health and medicine, could reasonably expect the illness or injury to result in:

1. Placing the health of the individual (or, with respect to a pregnant woman, the health of the woman or her unborn child) in jeopardy,

2. Impairment to bodily functions, or

3. Dysfunction of any bodily organ or part.

ITEM 2. Amend rule 441--88.3(249A) as follows:

Rescind subrule 88.3(3) and insert the following new subrule in lieu thereof:

88.3(3) Mandatory enrollment. Participation in managed health care, if available, is required as specified in this subrule for covered eligibles who reside in a mandatory project county. The department shall require, whenever administratively feasible, that all eligible recipients enroll with a managed care entity. Administrative feasibility is determined by whether a freedom-of-choice waiver or state plan amendment has been approved by the Health Care Financing Administration and whether the managed care entities demonstrate sufficient access to and quality of services.

Rescind subrule 88.3(6) and insert the following new subrule in lieu thereof:

88.3(6) Limitations on enrollment. Contracting managed care entities may specify in a contract a limit to the number of recipients who can be assigned under subrule 88.3(7). If a limit is specified, the contracting entity must still provide services to all enrolled recipients who voluntarily select enrollment in that option. If a specified limitation is reached, the remaining assignment needs in that county shall be met by the other managed care entities who are contracting with the department in that county.

Rescind subrule 88.3(7) and insert the following new subrule in lieu thereof:

88.3(7) Enrollment procedures. In mandatory enrollment counties, recipients shall be required to choose their managed care entity. When no choice is made by the recipient, the recipient shall be assigned to a contracting health maintenance organization (HMO) serving the recipient's county of residence, when an HMO is available. In the event there is no contracting HMO serving the recipient's county of residence in a mandatory enrollment county, the recipient shall be assigned to a MediPASS patient manager.

Within the MediPASS option, recipients shall be assigned according to age appropriateness. Whenever possible, family units shall be assigned to the same provider that an enrolled family member has selected, if that provider is appropriate according to age parameters. If not, the household shall be assigned to another physician. MediPASS patient managers shall not be assigned more recipients than their self-imposed maximum or the maximum described in subrule 88.46(5), whichever is lower.

Recipients who are assigned a managed care entity as described in this subrule shall have at least ten days in which to request enrollment in a different available entity. The change is subject to provisions in subrule 88.4(2) dealing with the effective date.

a. Timely notice. Recipients shall be sent timely notice of the managed care entity assignment. The recipient shall have a minimum of ten days in which a change to the assigned managed care entity can be made. The notice shall include the name of the managed care entity to whom the recipient shall be assigned if the recipient does not make a different selection by the date specified in the notice. If the covered eligible does not make a selection before the due date, the recipient shall be enrolled with the managed care entity listed on the notice.

b. Enrollment. Enrollment in managed health care shall be discussed during the face-to-face interview with all applicants for Medicaid under covered categories of assistance in mandatory or voluntary enrollment areas. The applicant shall be shown an informational videotape and encouraged to make a selection of a managed care entity. Applicants in mandatory enrollment areas shall be informed that should the applicant become eligible for a managed health care selection, one shall be assigned. Covered eligibles who are not enrolled shall be sent a notice of their managed health care assignment when the recipient:

(1) Attains initial eligibility for a covered category of service in a mandatory project county.

(2) Changes from an excluded category of assistance to a covered category of assistance in a mandatory project county.

(3) Is receiving a covered category of assistance and moves from a county where no managed health care is available or from a voluntary project county to a mandatory project county.

(4) Reattains eligibility.

(5) Has a new member of the household receiving a covered category of assistance.

c. Selection of a managed health care provider. A list of health care providers participating in managed care entities serving the county shall be available to recipients for use in selecting a provider. If the recipient wishes to request an exception to the list of available managed health care providers, the managed health care review committee shall make a determination on the exception request. While the determination is being made, the recipient's enrollment shall be placed in a pending status.

d. Request to change enrollment. An enrolled recipient may, within 90 days from timely notice, request to change enrollment from one managed health care provider to another or one managed care entity to another. The request may be made on a choice form designated by the department, in writing, or by telephone call to the toll-free recipient managed health care telephone line maintained by the department. Changes are subject to the provisions of subrule 88.4(2) dealing with effective date.

e. Managed care entity extended-participation program (EPP). After the initial 90 days from timely notice, recipients will remain enrolled with the chosen entity for the following six months, with three exceptions:

(1) A request for disenrollment by recipient for good cause pursuant to paragraph 88.4(3)"a."

(2) A request for disenrollment by provider for good cause pursuant to paragraph 88.4(3)"b."

(3) Availability of a new, previously unavailable, managed care entity. In this instance recipients will be allowed to select that entity for the remainder of the current EPP period.

f. Enrollment cycle. Prior to the end of any EPP period, recipients shall be notified of their ability to enroll with a different managed care option. A change in enrollment or failure to change enrollment will begin a new EPP enrollment period at the end of the current EPP.

ITEM 3. Amend rule 441--88.4(249A) as follows:

Rescind and reserve subrule 88.4(1).

Amend subrule 88.4(3), paragraph "a," as follows:

a. Request for disenrollment by the recipient. The enrolled recipient may request disenrollment by completing a choice form designated by the managed health care contractor, in writing or by telephone call to the toll-free recipient managed health care telephone line maintained by the department at any time prior to enrollment with a managed health care entity and within the 90 days from timely notice date. With prior approval of the review committee After this time period, a recipient may be disenrolled for good cause when the recipient can demonstrate that services were untimely, inaccessible, of insufficient quality, or inadequately provided, or that the recipient was enrolled automatically because no choice regarding the HMO was made as described in subrule 88.3(2). In a mandatory county, a disenrollment request must be accompanied by a choice for another managed health care provider.

ITEM 4. Amend rule 441--88.6(249A), catchwords, and adopt new subrule 88.6(4) as follows:

441--88.6(249A) Emergency and urgent care services.

88.6(4) Provision of urgent care. If the recipient is assigned to a patient manager by the HMO, the patient manager shall arrange for urgent care within 24 hours by either providing it or referring to and authorizing another appropriate provider to provide care.

ITEM 5. Rescind subrule 88.10(1) and insert the following new subrule in lieu thereof:

88.10(1) General requirements. An HMO may not distribute directly or through any agent or independent contractor any marketing materials, without the prior approval of the department, and may not distribute marketing materials that contain false or materially misleading information.

a. Service market. An HMO shall distribute any marketing materials to its entire service area or region.

b. Prohibition of tie-ins. An HMO, or any agency of the entity, may not seek to influence an individual's enrollment with the HMO in conjunction with the sale of any other insurance.

c. Prohibiting marketing fraud. Each HMO shall comply with the procedures and conditions the department prescribes in the contract in order to ensure that, before an individual is enrolled with the HMO, the individual is provided accurate oral and written information sufficient to make an informed decision whether or not to enroll.

d. Prohibition of "cold-call" marketing. HMOs shall not, directly or indirectly, conduct door-to-door, telephonic, or other "cold-call" marketing of enrollment.

ITEM 6. Amend subrules 88.12(1) and 88.12(2) as follows:

88.12(1) Capitation rate. In consideration for all services rendered by an HMO under a contract with the department, the HMO will receive a payment each month for each enrolled recipient. This capitation rate represents the total obligation of the department with respect to the costs of medical care and services provided to enrolled recipients under the contract.

A portion of any increase in capitation payments may be reserved for an incentive payment to be paid based on the percentage of counties in a region included in an HMO's enrollment area. Incentive payments shall be made retroactively to the beginning of a state fiscal year if an HMO increases the percentage of counties in a region included in its enrollment area.

88.12(2) Determination of rate. The capitation rate is actuarially determined for the beginning of each new fiscal year using statistics and data about Medicaid fee-for-service expenses for HMO-covered services to a similar population during the preceding a base fiscal year. (For example, fiscal year 1994 rates are predicted with fiscal year 1992 dates of service for Medicaid fee-for-service expenditures.) The capitation rate, including the expansion incentive enhanced capitation payment based on the counties in a region included in the HMO's enrollment area, shall not exceed the cost to the department of providing the same services on a fee-for-service basis to an actuarially equivalent nonenrolled population group. HMOs electing to share risk with the department shall have their payment rates reduced by an amount reflecting the department's experience for high cost fee-for-service recipients.

ITEM 7. Amend rule 441--88.41(249A), definitions of "Emergency care," "Medical service area," and "Urgent care," as follows:

"Emergency care" shall mean care of a medical condition, as defined in 441--subrule 78.3(12), that is provided under unforeseen circumstances and presents a substantial risk to the patient's health unless immediate medical treatment is given those medical services rendered for an emergent medical condition or protection of the public health.

"Medical service area" shall mean an enrolled recipient's county of residence and contiguous counties, whether in state or out of state means a geographic area within which recipients must reside in order to enroll in the managed health care MediPASS option.

"Urgent care" shall mean care of a medical condition that is not severe enough to be considered an emergency, but cannot wait until a normally scheduled doctor appointment those medical services rendered for an urgent medical condition or protection of the public health.

Further amend rule 441--88.41(249A) by adding the following new definitions in alphabetical order:

"Emergent medical condition" shall mean a medical condition manifesting itself by acute symptoms of sufficient severity (including severe pain) such that a prudent layperson, who possesses an average knowledge of health and medicine, could reasonably expect it to result in:

1. Placing the health of the individual (or, with respect to a pregnant woman, the health of the woman or her unborn child) in serious jeopardy,

2. Serious impairment to bodily functions, or

3. Serious dysfunction of any bodily organ or part.

The determination of whether an emergent medical condition exists shall be decided by a medical professional and shall be based on the patient's medical condition including presenting symptoms and medical history (as related to severe pain) prior to treatment.

In cases where the above criteria are satisfied, no prior authorization procedures are allowed.

"Extended-participation program" shall mean mandatory six-month enrollment period with a managed care entity.

"Managed care entity" shall mean either a managed care organization licensed by the department of insurance (e.g., HMO or PHP) or a primary care case management program (i.e., MediPASS).

"Mandatory enrollment" shall mean a mandatory participation in managed health care as specified in subrule 88.46(1).

"Mandatory project county" shall mean a county where the department has contracts with more than one managed care entity, one of which may be primary care case management (MediPASS) in cases where the number of MediPASS providers willing to serve as patient managers is sufficient to meet the needs and makeup of the recipient population in the county, or where the department has implemented the MediPASS program alone in the county.

"Urgent medical condition" shall mean a medical condition manifesting itself by acute symptoms that are of lesser severity (including severe pain) than that recognized for an emergent medical condition, such that a prudent layperson, who possesses an average knowledge of health and medicine, could reasonably expect the illness or injury to result in:

1. Placing the health of the individual (or, with respect to a pregnant woman, the health of the woman or her unborn child) in jeopardy,

2. Impairment to bodily functions, or

3. Dysfunction of any bodily organ or part.

If the recipient is assigned to a patient manager (e.g., MediPASS or HMO), the patient manager shall arrange for necessary care within 24 hours by either providing it or referring and authorizing another appropriate provider to provide care.

ITEM 8. Amend subrule 88.42(1) as follows:

88.42(1) Included categories of assistance. All categories of Medicaid-eligible recipients except those specified as excluded in subrule 88.42(2) are required to participate in Medicaid patient management managed health care if they reside in a mandatory project county as described in subrule 88.43(1). Recipients who reside in a voluntary project county as described in subrule 88.43(2) may participate if their choice of physician is available they so choose.

A choice to enroll in any other form of Medicaid managed health care available in the recipient's county of residence shall fulfill the requirements to participate in mandatory project counties.

ITEM 9. Amend rule 441--88.46(249A) as follows:

Amend subrule 88.46(1) as follows:

88.46(1) Mandatory enrollment. Participation in patient management or another form of managed health care, if available, is required for covered eligibles as specified in subrule 88.42(1) who reside in a mandatory project county. The department shall require, whenever administratively feasible, that all eligible recipients enroll with a managed care entity. Administrative feasibility is determined by whether a freedom-of-choice waiver or state plan amendment has been approved by the Health Care Financing Administration and whether the managed care entities demonstrate sufficient access to and quality of services. Recipients shall designate their choice of managed health care provider on a choice form designated by the managed health care contractor, in writing or by telephone call to the toll-free recipient managed health care telephone line. The department or its designee shall assign a patient manager or other managed health care provider for those recipients who fail to make their own selection.

Amend subrule 88.46(2) as follows:

88.46(2) Enrollment procedures. In mandatory enrollment counties, recipients shall be required to choose their managed health care provider. When no choice is made by the recipient, the recipient will be assigned to a contracting health maintenance organization (HMO) serving the recipient's county of residence, when an HMO is available. In the event there is no contracting HMO serving the recipient's county of residence in a mandatory enrollment county, the recipient shall be assigned to a Medicaid MediPASS patient management provider manager.

Within the patient management MediPASS option, recipients shall be assigned according to age appropriateness. Whenever possible, family units shall be assigned to the same provider that an already enrolled family member has selected, if that provider is appropriate according to age parameters. If not, the system shall assign the household to another physician. Patient MediPASS patient managers shall not be assigned more recipients than their self-imposed maximum or the maximum described in subrule 88.46(5), whichever is lower.

Recipients who are assigned a managed health care provider entity as described in this rule subrule shall have at least ten days in which to request enrollment in a different available managed health care plan entity. The change of plan is subject to provisions in subrules subrule 88.46(4) and 88.47(2) dealing with the effective date.

a. Timely notice. Recipients shall be sent timely notice of the managed health care assignment. The recipient shall have a minimum of ten days in which a change to the assigned managed health care provider entity can be made. The notice shall include the name of the managed health care provider entity to whom the recipient shall be assigned if the recipient does not make a different selection by the date specified in the notice. If the covered eligible does not make a selection before the due date, the recipient shall be enrolled with the managed health care provider entity listed on the notice.

b. Enrollment. Enrollment in managed health care shall be discussed during the face-to-face interview with all applicants for Medicaid under covered categories of assistance in mandatory or voluntary enrollment areas. The applicant shall be shown an informational videotape and encouraged to make a selection of a managed health care provider entity. Applicants in mandatory enrollment areas shall be informed that should the applicant become eligible for a managed health care selection, one shall be assigned. Covered eligibles who are not enrolled shall be sent a notice of their managed health care assignment when the recipient:

(1) Attains initial eligibility for a covered category of service in a mandatory project county.

(2) Changes from an excluded category of assistance to a covered category of assistance in a mandatory project county.

(3) Is receiving a covered category of assistance and moves from a nonproject county where no managed health care is available or voluntary project county to a mandatory project county.

(4) Reattains eligibility except as described in subrule 88.46(6) for a covered category of assistance.

(5) Has a new member of the household receiving a covered category of assistance.

If the covered eligible in a mandatory project county does not make another selection before the due date specified in the notice, the covered eligible shall be enrolled with the managed health care provider listed on the notice.

c. Selection of a patient manager managed health care provider. A list of patient managers managed health care providers participating in managed care entities serving the medical service area county shall be available to recipients in order to assist covered eligibles for use in selecting a patient manager provider. If the recipient wishes to request an exception to the list of available patient managers managed health care providers as described in subrule 88.44(3), the managed health care review committee shall make a determination on the exception request. While the determination is being made, the recipient's enrollment shall be placed in a pending status.

d. Rescinded IAB 5/7/97, effective 7/1/97.

e. Request to change enrollment. An enrolled recipient may, at any time within 90 days from timely notice, request to change enrollment from one managed health care provider to another or one managed health care option entity to another. The request shall be made on a choice form designated by the managed health care contractor department, in writing, or by telephone call to the toll-free recipient managed health care telephone line maintained by the department. Changes are subject to the provisions of subrules subrule 88.46(3) and 88.47(2) dealing with effective date.

f. Managed care entity extended-participation program (EPP). After the initial 90 days from timely notice, recipients will remain enrolled with the chosen provider for the following six months, with three exceptions:

(1) A request for disenrollment by recipient for good cause pursuant to paragraph 88.4(3)"a."

(2) A request for disenrollment by provider for good cause pursuant to paragraph 88.4(3)"b."

(3) Availability of a new, previously unavailable, managed care entity. In this instance recipients will be allowed to select that entity for the remainder of the current EPP period.

g. Enrollment cycle. Prior to the end of any extended-participation program (EPP) period, recipients will be notified of their ability to enroll with a different managed care option. A change in enrollment or failure to change enrollment will begin a new EPP enrollment period at the end of the current EPP.

Amend subrule 88.46(3), introductory paragraph, as follows:

88.46(3) Voluntary enrollment procedures. The request to enroll in a voluntary county shall be contingent on the requested patient manager being available. Voluntary enrollment procedures shall be the same guidelines as mandatory enrollment procedures except:

Further amend subrule 88.46(3) by adding the following new paragraph "d":

d. A managed health care provider must be available for enrollment.

ITEM 10. Amend subrule 88.47(1), paragraph "a," as follows:

a. The enrolled recipient may request disenrollment by completing a choice form designated by the managed health care contractor department, in writing, or by telephone call to the toll-free recipient managed health care telephone line maintained by the department at any time prior to enrollment with a managed health care entity and within the 90 days from the date of the enrollment notice. After this time period, a recipient may be disenrolled for good cause when the recipient can demonstrate that services were untimely, inaccessible, of insufficient quality, or inadequately provided. If the recipient is a covered eligible specified in subrule 88.42(1) as a mandatory participant, the recipient's disenrollment request shall not be approved until another patient manager or managed health care option is chosen.

ITEM 11. Amend rule 441--88.48(249A) as follows:

Amend subrule 88.48(1), introductory paragraph and paragraph "e," as follows:

88.48(1) Managed services. Provision of the following services by any provider other than the patient manager requires preauthorization authorization from the patient manager in order to be payable by Medicaid except that mental health and substance abuse services for all managed health care recipients are provided under the MHAP and MSACP programs and do not require authorization (see rules 441--88.61(249A) and 88.81(249A)):

e. Clinic (rural health clinic, federally qualified health center, maternal health center, ambulatory surgical center, genetic consultation center, birthing center).

Further amend subrule 88.48(1), last unnumbered paragraph, as follows:

These services require preauthorization authorization even if the need for the service is considered urgent as defined in rule 441--88.41(249A). However, in case of urgent medical conditions, the patient manager shall arrange for necessary care within 24 hours by either providing it or referring to and authorizing another appropriate provider to provide care.

Amend subrule 88.48(3), first unnumbered paragraph, as follows:

Emergency services are excluded from the preauthorization authorization requirement, even though these services may be ones customarily requiring prior authorization under patient management. Urgent care requires preauthorization unless the patient manager cannot be reached authorization in order for Medicaid services to be paid. In either urgent care situations where preauthorization was not possible or emergency care situations, the provider must obtain authorization after the fact from the patient manager in order to bill for the Medicaid service. The unauthorized use of a patient manager's authorization number shall be considered to be false or fraudulent claim submission and may subject the provider to recoupment or to sanctions described at 441--subrule 79.2(3).

ITEM 12. Amend rule 441--88.49(249A), introductory paragraph, as follows:

441--88.49(249A) Grievance procedure. The department shall establish a procedure whereby enrolled recipients or providers may express complaints or concerns either verbally or in writing specific to patient management managed health care services.

ITEM 13. Amend subrule 88.51(3) as follows:

88.51(3) Standards and procedures for utilization review and quality assessment Managed health care advisory committee. Participating patient managers managed health care providers will be invited to assist the department or its agent in establishing standards and procedures for utilization review and quality assessment and assessing goals of the state's Medicaid managed health care program. The department shall form an education and review committee a managed health care advisory committee made up of persons deemed appropriate by the department to review, advise and plan managed care goals with the department. Members may include representatives of MediPASS providers, HMO providers, FQHC providers, RHC providers, association representatives, and other public agencies as deemed appropriate by the department. The committee's functions may include, but are not limited to, the following:

a. Establish Assist the department in developing procedures and parameters for utilization review and conduct further review of the utilization of patient managers whose pattern of utilization falls outside established parameters.

b. Establish procedures for and conduct reviews of patient management records to evaluate quality of management services and access to service. Assist the department in establishing options for managed health care quality assessment.

c. Review and make Assist the department in reviewing and making recommendations for action on quality ofservice-related grievances under the grievance procedure outlined in rule 441--88.49(249A).

d. Establish procedures for Assist the department in developing corrective action steps and possible recommendations for sanctions of patient managers managed health care providers who have identifiable utilization or quality of management service deficiencies. The corrective action or sanctions may include suspension of management fees for a probationary period, termination of the patient management contract, peer education, or further review of utilization behavior or quality of service. The patient manager in question shall have the right to appear before the committee to address utilization or quality of management service concerns the committee is addressing.

e. Establish Assist the department in developing standards and procedures for patient managers managed health care providers to use in performing preadmission and preprocedure review functions.

f. Prepare or provide educational or informative articles about the committee's activities for publication in professional journals to be used for patient education and health promotion.

ITEM 14. Amend 441--Chapter 88, Division III, by adding the following new rule:

441--88.52(249A) Marketing. A MediPASS provider may not distribute directly or through any agent or independent contractor marketing materials without the prior approval of the department, and may not distribute marketing materials that contain false or materially misleading information.

88.52(1) Service market. A MediPASS provider shall distribute any marketing materials to the entire service area or region.

88.52(2) Prohibition of "cold-call" marketing. MediPASS providers shall not, directly or indirectly, conduct door-to-door, telephonic, or other "cold-call" marketing of enrollment.

ARC 7974A

The Council on Human Services adopted this amendment April 8, 1998. Notice of Intended Action regarding this amendment was published in the Iowa Administrative Bulletin on February 11, 1998, as ARC 7808A. That Notice has been separated into two parts for filing to allow different effective dates for the two parts. See ARC 7975A, herein.

This amendment rescinds Division I of 441--Chapter 175, which was the Child Abuse Investigations Program.

The Child Abuse Assessment Pilot Program was initiated on December 1, 1995. The General Assembly in 1996 debated the issue of whether to continue the Child Abuse Assessment Pilot Program or the Child Abuse Investigations Program. Although originally the plan was to have statewide implementation of the Child Abuse Assessment Program by July 1, 1996, the Pilot Program was continued until February 1997. In 1997, the General Assembly again debated the issue of implementing the Child Abuse Assessment Program statewide and eliminating the Child Abuse Investigations Program. The General Assembly determined that the Department of Human Services should incrementally expand the Child Abuse Assessment Program statewide and that full implementation should be completed by July 1, 1998.

However, Polk County will be unable to complete implementation of the Child Abuse Assessment Program by July 1, 1998, and legislation is being proposed in the Department's appropriation bill to allow the Department to continue to apply the rules in Division I in Polk County until September 1, 1998.

Eight public hearings were held around the state. Seven persons attended. No comments were received on this amendment. This amendment is identical to that published under Notice of Intended Action.

This amendment is intended to implement Iowa Code sections 232.67 and 232.72 to 232.77, Iowa Code Supplement sections 232.68 to 232.71 and Iowa Code Supplement chapter 235A.

This amendment shall become effective September 1, 1998.

The following amendment is adopted.

Rescind and reserve 441--Chapter 175, Division I.

ARC 7975A

The Council on Human Services adopted these amendments April 8, 1998. Notice of Intended Action regarding these amendments was published in the Iowa Administrative Bulletin on February 11, 1998, as ARC 7808A. This Notice has been separated into two parts for filing to allow different effective dates for the two parts. See ARC 7974A, herein.

These amendments expand from seven to eight the tasks associated with completion of the child abuse assessment. The child protection worker is required to determine service recommendations and referrals as part of the assessmentprocess. In addition, language is revised to provide consistent terminology, and Iowa Code references are updated. Rules governing access to child abuse information and persons conducting research from Division I (child abuse investigations) are added to Division II.

Eight public hearings were held around the state. Seven persons attended. The following revisions were made to the Notice of Intended Action in response to public comments:

Rule 441--175.22(232) was revised to clarify that reports of child prostitution must also be referred to law enforcement.

Rule 441--175.32(232,235A), introductory paragraphs, was revised to remove redundant language and to correct two form numbers.

Subrule 175.41(1) was revised to remove redundant language.

These amendments are intended to implement Iowa Code sections 232.67 and 232.72 to 232.77, Iowa Code Supplement sections 232.68 to 232.71 and Iowa Code Supplement chapter 235A.

These amendments shall become effective July 1, 1998.

The following amendments are adopted.

ITEM 1. Amend 441--Chapter 175, Division II, Preamble, as follows:

The purpose of this division is to implement anassessment-based approach to allegations of child abuse requirements established in the Iowa Code which charge the department of human services with accepting reports of child abuse, assessing those reports and taking necessary steps to ensure a reported child's safety. This approach was piloted in 19 county sites from January 15, 1996, to June 30, 1997. The pilot project sites shall be incrementally expanded during state fiscal year 1998 in a manner so as to ensure the assessment-based approach is used throughout the state as of July 1, 1998. Protection is provided through encouraging the reporting of suspected cases of abuse, conducting a thorough and prompt assessment of the reports, and providing rehabilitative services to abused children and their families. This response to child abuse reports of child abuse emphasizes child safety and engagement of a family in services, where necessary. The assessment-based approach recognizes that child protection and strong families are the responsibility not only of the family itself, but also of the larger community (including formal and informal service networks). It is the department's legal mandate to respond to reports of child abuse. The assessment approach shall allow the department to develop divergent strategies when responding to child abuse reports of child abuse, adjusting its response according to the severity of abuse, to the functioning of the family, and to the resources available within the child and family's community.

ITEM 2. Amend rule 441--175.21(232,235A) as follows:

Amend the definitions of "Assessment," "Assessment intake," "Harm," and "Subject of a report" as follows:

"Assessment" means the process by which the department carries out its legal mandate in the pilot areas of the state to ascertain if child abuse has occurred, to record findings, to develop conclusions based upon evidence, to address the safety of the child and family functioning, engage the family in services if needed, enhance family strengths and address needs in a culturally sensitive manner.

"Assessment intake" means the process by which the department receives and records reports of child abuse.

"Harm" means an emotional or nonphysical injury which has a deleterious damaging effect upon a child.

"Subject of a report of child abuse" means any of the following:

1. A child named in a report as having been abused, or the child's attorney or guardian ad litem.

2. A parent or the attorney for the parent of a child named in a report child abuse assessment summary as having been abused.

3. A guardian or legal custodian, or that person's attorney, of a child named in a report child abuse assessment summary as having been abused.

4. A person or the attorney for the person named in a report child abuse assessment summary as having abused a child.

Delete the definitions of "Assessment report" and "Pilot project sites."

Add the following new definitions in alphabetical order:

"Allegation" means a statement setting forth a condition or circumstance yet to be proven.

"Caretaker" means a person responsible for the care of a child as defined in Iowa Code section 232.68.

"Case" means a report of child abuse that has been accepted for assessment services.

"Rejected intake" means a report of child abuse that has not been accepted for assessment.

"Report of child abuse" means a verbal or written statement made to the department by a person who suspects that child abuse has occurred.

"Unduly" shall mean improper or unjust, or excessive.

ITEM 3. Amend rule 441--175.22(232) as follows:

441--175.22(232) Receipt of a report of child abuse. Reports of suspected child abuse shall be received by pilot assessment county departments department offices, or by the central abuse registry, or the Child Abuse Hotline. Anyreport made to the department which alleges child abuse as defined in Iowa Code section 232.68 shall be accepted for assessment. Intake information Reports of child abuse which does do not meet the legal definition of child abuse shall become rejected intakes. Rejected intakes may be referred for services. If a report does not meet the legal definition of child abuse, but a criminal act harming a child is alleged, the department shall immediately refer the matter to the appropriate law enforcement agency. If a report would be determined to constitute constitutes an allegation of child sexual abuse as defined under Iowa Code section 232.68, paragraph "c" or "e," except that the suspected abuse resulted from the acts or omissions of a person who was not a caretaker, the department shall refer the report to law enforcement orally and, as soon as practicable, and follow up in writing within 72 hours of receiving the report.

ITEM 4. Amend rule 441--175.23(232), catchwords and subrules 175.23(1) and 175.23(2), as follows:

441--175.23(232) Sources of report of child abuse.

175.23(1) Mandatory reporters. Any person meeting the criteria of a mandatory reporter is required to make an oral report of the suspected child abuse to the department within 24 hours of becoming aware of the abusive incident and make a written report to the department within 48 hours following the oral report. If the person making the report has reason to believe that immediate protection for the child is advisable, that person shall also make an oral report to an appropriate law enforcement agency.

175.23(2) Others required to report. In addition to mandatory reporters which are so designated by the Iowa Code, there are other classifications of persons who are required, either by administrative rule or department policy, to report suspected child abuse when this is a duty identified through the person's employment. Others required to report include:

a. Income maintenance workers.

b. Certified adoption investigators.

ITEM 5. Amend rule 441--175.24(232) as follows:

441--175.24(232) Child abuse assessment intake process. The primary purpose of intake is to obtain available and pertinent information regarding an allegation of child abuse and determine whether a report of child abuse becomes a case or a rejected intake. In order for an intake call to To result in an assessment a case, the report of child abuse must include some information to indicate all of the following. The alleged:

1. Victim of child abuse is a child.

2. Perpetrator of child abuse is a caretaker.

3. Incident falls within the definition of child abuse.

Only mandatory reporters or the person making the report may be contacted during the intake process to expand upon or to clarify information in the report. Any contact with subjects of the report or with nonmandatory reporters, other than the original reporter, automatically causes the case report of child abuse to be opened accepted for child abuse assessment services. If it is believed When it is determined that the report of child abuse fails to constitute an allegation of child abuse, the report of child abuse shall be rejected for child abuse assessment become a rejected intake. Rejected intake information shall be maintained by the department for six months and then destroyed. The county attorney shall be notified of intakes reports of child abuse accepted for assessment. When a report of child abuse is received which does not meet the requirements to become a case, but has information about illegal activity, the department shall notify law enforcement of the report.

ITEM 6. Amend rule 441--175.25(232) as follows:

441--175.25(232) Child abuse assessment process. An assessment shall be initiated within 24 hours following receipt of a the report of child abuse becoming a case. The primary purpose in conducting an assessment is to protect the safety of the child named in the report. The secondary purpose of the assessment is to engage the child's family in services to enhance family strengths and to address needs, where this is necessary and desired. There are seven eight tasks associated with completion of the assessment. These are:

1. Ensuring Observing and evaluating the child's safety. In instances when there is an immediate threat to the child child's safety, reasonable efforts shall be made to observe the alleged child victim named in the report within one hour of receipt of the report. Professional judgment shall dictate assurance of safety for the child. Otherwise, reasonable efforts shall be made to observe the alleged child victim within 24 hours of the report of child abuse becoming a case. When the alleged perpetrator clearly does not have access to the alleged child victim, reasonable efforts shall be made to observe the alleged child victim within 96 hours of receipt of the report. When reasonable efforts have been made to observe the alleged child victim within the specified time frames and the worker has established that there is no risk to the alleged child victim, the observation of the alleged child victim may be waived with supervisory approval.

2. Observing or interviewing Interviewing the alleged child victim.

3. Interviewing subjects of the report and other sources. Attempts shall be made to conduct interviews with subjects of the report and persons who have relevant information to share regarding the allegations. This may include contact with physicians to assess the child's condition. The child's custodial parents or guardians and the alleged perpetrator (if different) shall be interviewed, or offered the opportunity to be interviewed. The court may waive the requirement of the interview for good cause.

4. Gathering of physical and documentary evidence. Evidence shall be gathered from, but not be limited to, interviews, observations, photographs, medical and psychological reports and records, reports from child protection centers, written reports, audiotapes and their transcripts or summaries, videotapes and their transcripts or summaries, or other electronic forms.

5. Assessing Evaluating the home environment and relationships of household members. The assessment evaluation may, with the consent of the parent or guardian, include a visit to the home where the child resides. If permission is refused, the juvenile court may authorize the worker to enter the home to interview or observe or interview the child. An assessment evaluation of the home environment shall be conducted during the course of the child abuse assessment. If protective concerns are identified, the child protection worker shall evaluate the child named in the report and any other children in the same home as the parents or other persons responsible for their care. Each assessment case shall include a full description of information gathered during the assessment process. This description shall provide information which evaluates the safety of the child named in the report. If the child protection worker has concerns about a child's safety or a family's functioning, the worker shall conduct a more intensive assessment until those concerns are addressed. When an assessment is conducted at an out-of-home setting, assessment an evaluation of the environment and relationships where the abuse allegedly occurred shall be conducted.

6. Evaluating the information. Evaluation of information shall include an assessment analysis, which considers the credibility of the physical evidence, observations, and interviews, and shall result in a finding regarding conclusion of whether or not to confirm the allegation report of child abuse.

7. Determining placement on child central abuse registry. A determination if of whether the report data and disposition data of a confirmed case of child abuse is subject to placement on the child central abuse registry pursuant to 1997 Iowa Acts, House File 698, section 5, subsection 3, Iowa Code Supplement subsection 232.71D(3) shall be made on each report assessment.

8. Treatment service recommendations and referrals. There are four possible service recommendations during or at the conclusion of a child abuse assessment. These are:

* No treatment service needs are identified; the worker recommends no treatment service.

* Treatment service needs are identified; the worker recommends new or continuing treatment services to the family to be provided through informal supports.

* Treatment service needs are identified; the worker recommends new or continuing treatment services to the family to be provided through community agencies.

* Treatment service needs are identified; the worker recommends new or continuing treatment services to the family to be provided by the department, either directly or through contracted agencies. Except in cases involving court-ordered services, the department shall not compel the family to accept treatment services, and the child protection worker shall advise the family that acceptance of treatment services is voluntary. If it is believed that treatment services are necessary for the protection of the abused child or other children in the home, juvenile court intervention shall be sought.

ITEM 7. Amend rule 441--175.26(232) as follows:

441--175.26(232) Completion of a written child protective assessment summary. When an assessment is completed, the The child protection worker shall complete a written child protective assessment summary within 20 business days from the receipt date of the report of child abuse becoming a case. In most instances, the child protective assessment summary shall be developed in conjunction with the child and family being assessed. All summaries A child pro-tective assessment summary shall include the following consist of two parts as follows:

175.26(1) Information about the report Child Protective Assessment Summary - Part A, Form 470-3240. All summaries The Part A summary shall include report and dispositional data information about as follows:

a. Allegations: the report of child abuse which caused the assessment to be initiated and an assessment additional allegations raised after the report of child abuse becomes a case that have not been previously investigated or assessed.

b. Evaluation of the child's safety.: evaluation of the child's safety and the risk for occurrence or reoccurrence of abuse. Criteria to be used in the evaluation of the child's safety include, but are not limited to, the severity of the incident or condition, chronicity of the incident or condition, age of the child, attitude of the person responsible, current treatment services or supports, access of the person responsible for the abuse to the child, and protectiveness of the parent or caretaker who is not responsible for the abuse.

c. Findings and contacts: The Part A summary shall include a description of the child's condition including identification of the nature, extent, and cause of the injuries, if any, to the child named in the report,; identification of the injury or risk to which the child was exposed,; the circumstances which led to the injury or risk to the child,; the identity of the person alleged to be responsible for the injury or risk to the child, and ; the name, age and condition of other children in the same home as the child named in the report if protective concerns are identified; a list of collateral contacts; and a history of confirmed or founded abuse.

d. Determination regarding the allegations of child abuse: a statement of determination of whether the allegation of child abuse was founded, confirmed but not placed on the central abuse registry, or not confirmed. The statement shall include a rationale for placing or not placing the case on the central abuse registry.

e. Recommendation for treatment services: a statement describing whether treatment services are necessary to ensure the safety of the child or to prevent or remedy other identified problems. The statement shall include the type of treatment services recommended, if any, and whether these treatment services are to be provided by the department, community agencies, informal supports, or another treatment source. If treatment services are already being provided, the statement shall include a recommendation whether these treatment services should continue.

f. Juvenile court recommendation: a statement describing whether juvenile court action is necessary to ensure the safety of the child; the type of action needed, if any; and the rationale for the recommendation.

g. Criminal court recommendation: a statement describing whether criminal court action is necessary and the rationale for the recommendation.

175.26(2) An assessment of the family's strengths and needs Child Protective Assessment Summary - Part B, Form 470-3241. The Part B summary shall include assessment information as follows:

a. An evaluation of the child and family functioning: an evaluation which identifies the strengths and needs of the child, parents, home environment, family, family support system, and community support system.

b. A history of services: a history of informal and formal treatment or support services offered or provided to the family and a suggested plan of action to meet identified needs and to build on existing strengths. The history shall include treatment services available from the department, informal and formal services, and other supports available in the community. A comprehensive assessment of the family's strengths and needs shall occur for every case in which ongoing treatment services through the department are initiated identified and for all cases in which a family requests this service. A comprehensive assessment of the family's strengths and needs shall be strongly encouraged whenever the family and child are not receiving required or desired treatment services or supports or when there are circumstances which place the child at risk for abuse. The Part B summary shall include an assessment of the child's safety and the family's functioning. For assessment cases in which the child, family and child protection worker identify unmet needs, the summary shall identify the strengths and needs of the child and of the child's parent, home, family and community. It shall include a suggested plan of action to meet identified needs and to build on existing strengths and identify services available from the department and informal and formal services and other supports available in the community to address the strengths and needs identified in the assessment. This portion of the written summary may be used as part of the child's case permanency plan for assessment cases in which ongoing treatment services will be provided by the department. Part B is assessment data and shall not be submitted to the child central abuse registry.

ITEM 8. Amend rule 441--175.27(232) as follows:

441--175.27(232) Contact with juvenile court or the county attorney. The child protection worker may orally contact juvenile court or the county attorney, or both, as circumstances warrant. When a child abuse report of child abuse is accepted for assessment, the county attorney shall be provided Form 470-0607, Child Protective Service Intake, with information about the allegation of child abuse and with identifying information about the subjects of the report. The child protection worker shall provide the juvenile court and the county attorney with a copy of the written assessment summary Form 470-3240, Child Protective Assessment Summary - Part A, which pertains to the evaluation of the abuse reported findings, determinations, and recommendations regarding the report of child abuse. The assessment child protection worker shall provide the county attorney and the juvenile court with a copy of the written assessment summary Form 470-3241, Child Protective Assessment Summary - Part B, which pertains to the evaluation of the child and family's strengths and needs and the development of a suggested plan of action when any of the following occur:

175.27(1) County attorney's or juvenile court's assistance necessary. The worker requires the court's or the county attorney's assistance to complete the assessment process.

175.27(2) Court's protection needed. The worker believes that the child requires the court's protection.

175.27(3) Child adjudicated. The child is currently adjudicated or pending adjudication under a child in need of assistance petition or a delinquency petition.

175.27(4) County attorney or juvenile court requests copy. The county attorney or juvenile court requests a copy of Form 470-3241, Child Protective Assessment Summary - Part B. The child protection worker shall document when the Child Protective Assessment Summary - Part B is provided to the county attorney or juvenile court and the rationale provided for the request.

ITEM 9. Amend rule 441--175.31(232) as follows:

441--175.31(232) Completion of required correspondence.

175.31(1) Notification to parents that an a child abuse assessment is taking place being conducted. Written notice shall be provided to the parents of a child who is the subject of an assessment within five working days of commencing an assessment unless the assessment is completed within that time frame the five working days. Both custodial and noncustodial parents shall be notified, if their whereabouts are known. If it is believed that notification will result in danger to the child or others, an emergency order to prohibit parental notification shall be sought from juvenile court.

175.31(2) Notification of completion of assessment and right to request correction. Written notice shall be provided to all subjects of a child abuse assessment and to the mandatory reporter who made the report of child abuse which indicates that the child abuse assessment is completed. Both custodial and noncustodial parents shall be notified if their whereabouts are known. The notice shall contain information concerning the subject's rights to request correction and appeal rights. The subject may request correction of the information contained within the written child protective assessment summary if the subject disagrees with the information. The subject may appeal the content of the written child protective assessment summary only if the request for correction of the written child protective assessment summary is denied. If the child protective assessment summary results in a determination that abuse has occurred is confirmed, the notice shall indicate the type of abuse, name of the child and name of the person responsible for the abuse and whether the report has been placed on the registry.

ITEM 10. Amend rule 441--175.32(232,235A) as follows:

441--175.32(232,235A) Case records. The assessment case record shall contain the written child protective assessment summary and any related correspondence or information which pertains to the report assessment or to the child and family. The name of the person who made the report of child abuse shall not be disclosed to the subjects of the report or their attorneys. The written child protective assessment summary shall have two sections parts.

The first section, Part A, Form 470-3240, which is report and disposition data,. Part A shall contain information which pertains to the child abuse allegation report of child abuse, and a description of the child's condition, identification of the injury or risk to which the child was exposed and the identity of any person alleged to be responsible for the injury or risk to the child. Subjects of the report and their attorneys have access to that information which is contained within the first section of the written summary Part A of the child protective assessment summary, including, where applicable, confirmation of placement on the child central abuse registry for abuse reports meeting the criteria pursuant to 1997 Iowa Acts, House File 698, section 5, subsection 3 Iowa Code Supplement subsection 232.71D(3). Part A of the report shall be sent to the juvenile court having jurisdiction over the child and to the county attorney. Part A shall only be submitted to the central abuse registry if the abuse is confirmed and determined to meet the criteria pursuant to 1997 Iowa Acts, House File 698, section 5, subsection 3 Iowa Code Supplement subsection 232.71D(3).

The second section of the written summary, Part B, Form 470-3241, which is assessment data,. Part B shall contain information which identifies the strengths and needs of the child, of the child's parent, home, family and community and, where appropriate, a suggested plan of action which is developed in conjunction with the family. The second section of the written summary Part B shall be available to those family members who participated in the assessment of child and family function, strengths, needs, and the development of a suggested plan of action to meet identified needs, if applicable. Release of any information contained within the second section of the written summary Part B shall be accomplished only when the parent or guardian approves the release as provided through Iowa Code chapter 217, except for founded reports which are governed under Iowa Code section 235A.15. Part B is assessment data and shall not be submitted to the central abuse registry.

175.32(1) Reports not placed on the central registry Assessments where abuse was confirmed but not placed on the central abuse registry. Access to the report data and disposition data of an assessment report not placed on the child central abuse registry is authorized only to the subjects of the assessment report, the child protective protection worker, law enforcement officer responsible for assisting in the assessment, the multidisciplinary team if assisting the department in the assessment of the abuse, county attorney, juvenile court, a person or agency responsible for the care of the child if the department or juvenile court determines that access is necessary, the department or contract personnel necessary for official duties, the department of justice, and the attorney for the department. Records are The child abuse assessment summary is retained five years from date of intake or five years from the date of closure of the service record, whichever occurs later. The report child abuse assessment summary is subject to confidentiality provisions of Iowa Code chapter 217 and 441--Chapter 9. No confidential information shall be released without consent except where there is otherwise authorized access to information as specified in the provisions of Iowa Code Supplement section 235A.15 as amended by 1997 Iowa Acts, House File 698, section 9, subsection 3.

175.32(2) Reports Assessments not placed on the central abuse registry where abuse was not confirmed. Access to the report data on a report child abuse assessment summary where abuse was not determined to have occurred and, therefore, the report assessment was not placed on the child central abuse registry is authorized only to the subjects of the assessment report, the child protective protection worker, county attorney, juvenile court and department or contract personnel necessary for official duties. Records are retained five years from date of intake or five years from the date of closure of the service record, whichever occurs later. The report child abuse assessment summary is subject to confidentiality provisions of Iowa Code chapter 217 and 441--Chapter 9. No confidential information shall be released without consent except where there is otherwise authorized access to information as specified in the provisions of Iowa Code Supplement section 235A.15 as amended by 1997 Iowa Acts, House File 698, section 9, subsection 4.

ITEM 11. Amend rule 441--175.33(232,235A) as follows:

441--175.33(232,235A) Child protection centers. The department may contract with designated child protection centers for assistance in conducting child abuse assessments. When a child who is the subject of an assessment is interviewed by staff at a child protection center, that interview may be used in conjunction with an interview conducted by the assessment child protection worker. Written reports developed by the child protection center shall be provided to the assessment child protection worker and may be included in the assessment case file record. Video or audio records are considered to be part of the assessment process and shall be maintained by the child protection center under the same confidentiality provisions of Iowa Code chapter 217 and 441--Chapter 9.

ITEM 12. Amend rule 441--175.35(232,235A), introductory paragraph, as follows:

441--175.35(232,235A) Jurisdiction of assessments. Assessment personnel Child protection workers serving the county in which the child's home is located have primary responsibility for completing the child abuse assessment except when the abuse occurs in an out-of-home placement. Circumstances in which the department shall conduct an assessment when another state is involved include the following:

ITEM 13. Amend rule 441--175.36(235A), introductory paragraph and subrule 175.36(4), as follows:

441--175.36(235A) Multidisciplinary teams. Multidisciplinary teams shall be developed in county or multicounty areas in which more than 50 child abuse reports cases are received annually. These teams may be used as an advisory group to assist the department in conducting assessments. Multidisciplinary teams consist of professionals practicing in the disciplines of medicine, public health, mental health, social work, child development, education, law, juvenile probation, law enforcement, nursing, and substance abuse counseling. Members of multidisciplinary teams shall maintain confidentiality of cases in which they provide consultation. Rejected intakes shall not be shared with multidisciplinary teams since they are not considered to be child abuse information. During the course of an assessment, information regarding the initial child abuse report of child abuse and information related to the child and family functioning may be shared with the multidisciplinary team. After a conclusion is made, only report data and disposition data on confirmed cases of child abuse may be shared with the team members. When the multidisciplinary team is created, all team members shall execute an agreement, filed with the central abuse registry, which specifies:

175.36(4) Confidentiality provisions. Any written report or document produced by the team pertaining to an assessment case shall be made a part of the file for the case and shall be subject to all confidentiality provisions of 441--Chapter 9, unless the assessment results in placement on the child central abuse registry in which case the written report or document shall be subject to all confidentiality provisions of Iowa Code chapter 235A.

ITEM 14. Amend rule 441--175.37(232) as follows:

441--175.37(232) Community education. The department shall conduct a continuing publicity and educational program for the personnel of the department, mandatory reporters, and the general public to encourage recognition and reporting of suspected child abuse, to improve the quality of reports of child abuse made to the department, and to inform the community about the assessment-based approach to child abuse reports cases.

ITEM 15. Amend rule 441--175.38(235) as follows:

441--175.38(235) Written authorizations. Requests for information from members of the general public as to whether a person is named on the child central abuse registry as having abused a child shall be submitted on Form 470-3301, Authorization for Release of Child Abuse Information, to the county office of the department or the central child abuse registry. The form shall be completed and signed by the person requesting the information and the person authorizing the check for the release of child abuse information.

ITEM 16. Amend rule 441--175.39(232) as follows:

441--175.39(232) Founded child abuse. Reports of child abuse where abuse has been confirmed shall be placed on the central abuse registry as founded child abuse for ten years under any of the circumstances specified by 1997 Iowa Acts, House File 698, section 5, subsection 3 Iowa Code Supplement subsection 232.71D(3). Reports of denial of critical care by failure to provide adequate clothing or failure to provide adequate supervision and physical abuse where abuse has been confirmed and determined to be minor, isolated, and unlikely to reoccur shall not be placed in the central abuse registry as a case of founded child abuse as specified by 1997 Iowa Acts, House File 698, section 5, subsections 2 and 3 Iowa Code Supplement subsections 232.71D(2) and (3). The confirmed abuse shall be placed on the registry unless all three conditions are met. Minor abuse shall be placed on the registry if there is a prior confirmed abuse.

ITEM 17. Amend rule 441--175.40(235A) as follows:

Amend rule 441--175.40(235A), introductory paragraph and subrule 175.40(1), as follows:

441--175.40(235A) Retroactive reviews. Review of child abuse information which is on the child central abuse registry as of July 1, 1997, shall be performed using the requirements for child abuse reports cases to be placed on the central abuse registry as founded child abuse pursuant to 1997 Iowa Acts, House File 698, section 5, subsections 2 and 3 Iowa Code Supplement subsections 232.71D(2) and (3). If the review indicates the information should not be placed on the child central abuse registry, the information shall be expunged from the registry. The information shall be retained as a service record for five years from the date of intake. The time the report has been placed on the central abuse registry shall count toward the five years' total.

175.40(1) Eligibility for retroactive reviews. Eligibility for retroactive reviews is limited to reports which do not meet the criteria for placement in the central abuse registry as a case of founded child abuse specified in 1997 Iowa Acts, House File 698, section 5, subsection 3 Iowa Code Supplement subsection 232.71D(3). The reports eligible for review are reports where the confirmed abuse involved one of the following circumstances:

a. Physical abuse where the injury was minor and isolated and is unlikely to reoccur.

b. Denial of critical care by failure to provide adequate clothing or failure to provide adequate supervision, where the risk to the child's health and welfare was minor and isolated and is unlikely to reoccur.

Rescind and reserve subrule 175.40(2).

Amend subrule 175.40(3) as follows:

175.40(3) Reviews initiated by department. Reviews shall be performed when the department is reviewing a report case for the purpose of one of the following:

a. A record check evaluation is being completed for licensing, registration or employment or residence in a child care facility. If the department worker completing the record check evaluation determines the report case does not meet the criteria specified in 1997 Iowa Acts, House File 698, section 5, subsection 3, Iowa Code Supplement subsection 232.71D(3) and, therefore, should be expunged from the central abuse registry, the department worker shall provide copies of the child abuse written report and Form 470-2310, Record Check Evaluation, to the Department of Human Services, Chief, Bureau of Program Support and Protective Services, Retroactive Review, Hoover State Office Building, Des Moines, Iowa 50319-0114. Within 30 days the bureau chief shall determine if the report is to be expunged from the central abuse registry and shall notify the regional administrator or designee in writing of that decision and the time frame for retention or expungement of the report. The bureau chief or designee shall notify the person on whom the review was completed of the decision to expunge the report case from the central abuse registry. If the department determines that the report case is to be expunged from the central abuse registry, no record check evaluation is necessary and the department shall notify the requester. If the department determines that the report case does meet the criteria for placement on the central abuse registry, the department shall proceed with the record check evaluation procedure.

b. A central abuse registry review is being completed in response to a request for correction or expungement. After the department has completed a central abuse registry review and has determined the report case is a confirmed case of child abuse, the department shall determine if the report case is eligible for a retroactive review. If eligible for retroactive review, the department shall perform a review to determine if the report case should be listed on the child central abuse registry. Notification of the decision shall be sent with the central abuse registry review decision.

ITEM 18. Amend 441--Chapter 175 by adding the following new rules:

441--175.41(235A) Access to child abuse information. Requests for child abuse information shall include sufficient information to demonstrate that the requesting party has authorized access to the information.

175.41(1) Written requests. Requests for child abuse information shall be submitted on Form SS-1606-0, Request for Child Abuse Information, to the county office of the department, except requests made for the purpose of determining employability of a person in a department-operated facility shall be submitted to the central abuse registry. Subjects of a report may submit a request for child abuse information on Form SS-1606-0 or on Form 470-0686, Child Abuse Notification, to the county office of the department. The county office is granted permission to release child abuse information to the subject of a report immediately upon verification of the identity and subject status.

175.41(2) Oral requests. Oral requests for child abuse information may be made when a person making the request believes that the information is needed immediately and if the person is authorized to access the information. When an oral request to obtain child abuse information is granted, the person approving the request shall document the approval to the central abuse registry through use of Form SS-1606-0, Request for Child Abuse Information, or Form 470-0686, Child Abuse Notification.

Upon approval of any request for child abuse information authorized by this rule, the department shall withhold the name of the person who made the report of child abuse unless ordered by a juvenile court or district court after a finding that the person's name is needed to resolve an issue in any phase of a case involving child abuse. Written requests and oral requests do not apply to child abuse information that is disseminated to an employee of the department, to a juvenile court, or to the attorney representing the department as authorized by Iowa Code section 235A.15.

175.41(3) Written authorizations. Requests for information from members of the general public as to whether a person is named on the central abuse registry as having abused a child shall be submitted on Form 470-3301, Authorization for Release of Child Abuse Information, to the county office of the department or the central abuse registry. The form shall be completed and signed by the person requesting the information and the person authorizing the check for the release of child abuse information.

The department shall not provide requested information when the authorization form is incomplete. Incomplete authorization forms shall be returned to the requester.

441--175.42(235A) Person conducting research. The supervisor of the central abuse registry shall be responsible for determining whether a person requesting child abuse information is conducting bona fide research, whether the research will further the official duties and functions of the central abuse registry, and whether identified information is essential to the research design. A bona fide research design is one which shows evidence of a good-faith, academically objective and sincere intent to add to the body of knowledge about child abuse. To make this determination, the central abuse registry shall require the person to submit credentials and the research design. Additional criteria for approval of a research project may include whether the research involves contact with subjects of child abuse information, and whether contact with department personnel is required to complete the research design. If it is determined that the research will involve use of identified information, the central abuse registry shall also determine under what circumstances and in what format the information is to be used and shall execute an agreement with the researcher which will enable the researcher to obtain access to identified information on subjects of child abuse investigations, as an agent of the central abuse registry. The department will require the researcher to assume costs incurred by the department in obtaining or providing information for research purposes. The department shall keep a public record of persons conducting this research.

175.42(1) Child abuse factors. For purposes of conducting research pursuant to Iowa Code sections 235A.15 and 235A.23, official duties and functions of the central abuse registry shall include analysis or identification of child abuse factors in at least one of the following areas:

a. Causes of abuse--victim, parent and perpetrator characteristics, types of abuse, and correlations to family and environmental factors.

b. Effects of abuse--immediate and long-term effects of abuse on the individual child victim, the child's family and the perpetrator, in areas such as family functioning, foster placement, emotional and medical problems, and criminal activity; and effects of abuse on the community and society in general.

c. Prevention of abuse--intervention, prevention and treatment strategies.

d. Treatment of abuse--impact of service delivery upon recidivism and maintenance of the family unit.

e. Reporting of abuse--mandatory and permissive reporter characteristics, training needs, and perception of the department's protective services to children and families.

f. Identification of strengths and weaknesses in statute, policy or practice concerning child abuse services.

175.42(2) Guidelines. To be accepted by the central abuse registry, a research proposal originating outside the department shall meet the following guidelines:

a. The proposal shall meet the criteria listed above as "official duties and functions" of the central abuse registry.

b. The research shall be conducted by a competent researcher, evidenced by affiliation with a recognized human services agency, government body, or academic, social work or medical facility. The researcher shall demonstrate an ability to conduct nonbiased research and present findings in a professional and responsible manner which will benefit the department in providing protective services to children and families.

c. The proposed research shall not unduly interfere with the ongoing duties and responsibilities of department staff.

d. When the proposed research includes contact with subjects of child abuse information, the research design shall reflect a plan for initial subject contact by the department, which includes the following:

(1) Subjects shall be informed in writing of their right to refuse to participate in the research.

(2) Subjects shall receive written assurance that their participation in the research will not affect eligibility for services.

(3) Department staff shall be advised of research goals and procedures prior to contact with subjects, in order to answer questions which may arise.

(4) Subjects shall receive written assurance that when identifying information is released by the central abuse registry to research staff, the information will remain confidential and that all child abuse information will be deidentified prior to publication of the research findings.

175.42(3) Approval procedures. Procedures for approval of a research proposal are conducted as follows:

a. The supervisor of the central abuse registry shall designate a person to be the single point of contact (SPOC) for all research proposals requesting child abuse information or involving department staff who provide child protective services. All proposals shall be routed to the SPOC at the Division of Adult, Children and Family Services, Department of Human Services, Hoover State Office Building, Des Moines, Iowa 50319-0114.

b. Having received a research proposal, the SPOC shall log the date the proposal was received and other identifying information about the researcher and the research design and shall convene a research advisory committee to review the proposal. This committee may consist of:

(1) The unit supervisor of the child and dependent adult abuse registry, when applicable.

(2) The unit managers for the programs addressed by the research proposal.

(3) The research specialist.

(4) Representatives from the field, including a regional administrator or designee and one representative from a region, appointed by the regional administrator, if a specific region is involved.

(5) A representative from the department's division of management information, when the proposal involves use of one of the department's computerized data systems.

(6) A representative of the attorney general's office, when the proposal involves legal questions or issues.

(7) Other persons whom the SPOC may designate to assist in the review.

c. The SPOC is responsible for ensuring that advisory committee members receive copies of the research proposal.

d. The advisory committee may meet in person or by teleconference.

e. The researcher may, at the discretion of the SPOC, be provided an opportunity to address the advisory committee concerning the research proposal and answer questions about the research design.

f. The committee shall determine the value of the proposed research and formulate recommendations for acceptance of the proposal (with conditions as necessary) or rejection of the proposal (with rationale for the rejection). These recommendations shall be submitted to the SPOC.

g. The SPOC shall transmit the committee's recommendations, with additional comments and recommendations, as needed, to the division administrators for the divisions involved.

h. The division administrators shall review committee recommendations and submit the research proposal to the director or designee for final approval.

i. After review by the director, the proposal shall be returned to the SPOC, who shall notify the researcher of the director's decision, which decision shall be final.

j. If the research proposal is approved, the SPOC shall prepare a written research agreement with the researcher which provides:

(1) The purpose of the research.

(2) The research design or methodology.

(3) The control of research findings and publication rights of all parties, including the deidentification of child abuse information prior to publication.

(4) The duties of all parties in conducting the research.

(5) The transfer of funds, if applicable.

k. The SPOC shall be responsible for securing written approval of the research agreement from the attorney general's office, applicable division administrators, and the researcher.

l. The SPOC shall be responsible for maintaining the research agreement throughout the research project and renewing or modifying the agreement when necessary.

ITEM 19. Amend 441--Chapter 175, implementation sentence, as follows:

These rules are intended to implement Iowa Code sections 232.67 and 232.72 to 232.77, Iowa Code Supplement chapter 235A as amended by 1997 Iowa Acts, Senate File 230 and House File 698, and Iowa Code Supplement sections 232.67

232.68 to 232.77 232.71 as amended by 1997 Iowa Acts, Senate File 176, Senate File 230 and House File 698.

ARC 7991A

Notice of Intended Action was published in IAB, Volume XX, Number 12, on December 3, 1997, page 1087, as ARC 7698A.

Recent legislation has greatly expanded the exemption from sales and use tax applicable to machinery, equipment, and computers used by a manufacturer in processing and certain related exemptions as well. A few existing rules have been amended and an extensive new rule drafted which explain the major changes to these important, related exemptions.

These amendments are identical to those published under Notice of Intended Action except that these amendments now also implement Senate File 2288 passed by the 1998 General Assembly and signed into law on April 9, 1998. This legislation corrected 1997 Iowa Acts, House File 126. The corrections were reflected in the Notice and "1998 Iowa Acts, Senate File 2288," was added to the implementation clause of Item 8.

These amendments will become effective June 10, 1998, after filing with the Administrative Rules Coordinator and publication in the Iowa Administrative Bulletin.

These amendments are intended to implement Iowa Code Supplement section 422.45(27) as amended by 1998 Iowa Acts, Senate File 2288; Iowa Code section 422.45(29); and Iowa Code chapter 423.

The following amendments are adopted.

ITEM 1. Amend subrule 15.3(3), paragraph "a," second unnumbered paragraph, as follows:

"Fuel consumed in processing" includes fuel used in grain drying, providing heat or cooling for livestock buildings, fuel used for generating electric current, fuel consumed in implements of husbandry engaged in agricultural production, as well as fuel used in "processing" as defined in rule rules 701--18.29(422,423) and 701--18.58(422,423). See rule 701--18.29(422,423) for a general definition of "processing" and rule 701--17.2(422) for a detailed description of "fuel used in processing." See rule 701--17.3(422,423) for extensive discussion regarding electricity and steam used in processing.

ITEM 2. Amend subrule 17.3(1), introductory paragraph, as follows:

17.3(1) Services used in processing prior to July 1, 1985. Prior to July 1, 1985, electricity, Electricity, steam, or any other taxable service is used in processing only if the taxable service is used in any operation which subjects raw material to some special treatment which changes, by artificial or natural means, the form, context, or condition of the raw material and results in a change of the raw material into marketable tangible personal property intended to be sold ultimately at retail. The following are nonexclusive examples of what would and would not be considered electricity, steam or other taxable services used in processing prior to July 1, 1985:

ITEM 3. Amend subrule 17.3(2), introductory paragraph, as follows:

17.3(2) Carbon dioxide in a liquid, solid, or gaseous form, electricity, steam, and other taxable services used in processing on and after July 1, 1985. On and after July 1, 1985, an An expanded definition of "processing" is allowed only to manufacturers of food products for human consumption using carbon dioxide in a liquid, solid, or gaseous form, electricity, steam, and other taxable services. For periods on and after July 1, 1985, the The definition of processing applicable to persons who are not manufacturers of food products but who are using taxable services is found in subrule 17.3(1).

ITEM 4. Amend subrule 17.14(2), paragraph "b," as follows:

b. The chemical, solvent, sorbent, or reagent must be directly used and consumed, dissipated, or depleted during processing as defined in rule 701--18.29(422,423).

ITEM 5. Amend subrule 18.29(7), paragraph "g," as follows:

g. 18.45(422,423) Sale or rental of computers, industrial machinery and equipment; refund of and exemption from tax paid for periods prior to July 1, 1997.

ITEM 6. Amend subrule 18.29(7) by adding new paragraph "h" and relettering paragraphs "h" to "k" as "i" to "l" as follows:

h. 18.58(422,423) Sales or rentals of machinery, equipment, and computers and sales of fuel and electricity to manufacturers and sales or rentals of computers to commercial enterprises for periods on and after July 1, 1997.

h. i. 26.2(422) Enumerated services exempt. See 701-- subrule 26.2(2) for the processing exemption.

i. j. 28.2(423) Processing of property defined.

j. k. 33.3(423) Fuel consumed in creating power, heat, or steam for processing or generating electric current.

k. l. 33.7(423) Property used to manufacture certain vehicles to be leased.

ITEM 7. Amend rule 701--18.45(422,423), introductory paragraph, as follows:

701--18.45(422,423) Sale or rental of computers, industrial machinery and equipment; refund and exemption from tax paid for periods prior to July 1, 1997. The sale or rental of computers, industrial machinery and equipment, including pollution control equipment, used in manufacturing, in research and development, or in the processing or storage of data or information by an insurance company, financial institution, or commercial enterprise is, under certain circumstances, exempt from tax and, under other circumstances, is subject to refund of sales or use tax paid. The sale or rental of machinery, equipment, or computers directly and primarily used in the recycling or reprocessing of waste products is also exempt from tax; see subrule 18.45(8). For purposes of the organization of this rule, items that may be exempt or subject to refund of tax are referred to as specified property unless the context of the rule indicates otherwise. See subrule 18.45(1) for definition of what constitutes specified property. See rule 18.58(422,423) for the manner in which the sale or rental of machinery, equipment, and computers to manufacturers and the sale or rental of computers to commercial enterprises are treated on and after July 1, 1997.

ITEM 8. Amend 701--Chapter 18 by adding the following new rule:

701--18.58(422,423) Exempt sales or rentals of computers, industrial machinery and equipment, and exempt sales of fuel and electricity on and after July 1, 1997. The sale or rental of machinery, equipment, or computers used by a manufacturer in processing; the sale or rental of a computer used in the processing or storage of data or information by an insurance company, financial institution, or commercial enterprise; and the sale or rental of various other types of tangible personal property are, under certain circumstances, exempt from tax as of July 1, 1997.

18.58(1) Definitions. The following terms are defined for the purposes of this rule in the manner set out below.

"Commercial enterprise" includes businesses and manu-facturers conducted for profit and includes centers for data processing services to insurance companies, financial institutions, businesses, and manufacturers, but excludes professions and occupations and nonprofit organizations. A hospital that is a not-for-profit organization would not be a "commercial enterprise." The term "professions" means a vocation or employment requiring specialized knowledge and often long and intensive academic preparation. The term "occupations" means the principal business of an individual. Included within the meaning of "occupations" is the business of farming. A professional corporation which carries on any business which is a "profession" or "occupation" is not a commercial enterprise.

"Computer" means stored program processing equipment and all devices fastened to it by means of signal cables or any communication medium that serves the function of a signal cable. Nonexclusive examples of devices fastened by a signal cable or other communication medium are terminals, printers, display units, card readers, tape readers, document sorters, optical readers, and card or tape punchers. Excluded from the definition of "computer" is point-of-sale equipment. For a characterization of "point-of-sale equipment," see 701--subrule 71.1(7). Also included within the meaning of the word "computer" is any software consisting of an operating system or executive program. Such software coordinates, supervises, or monitors the basic operating procedures of a computer. An operating system or executive program is exempt from sales tax only if purchased as part of the sale of the computer for which it operates. An operating system or executive program priced separately or sold at a later time is subject to the provisions of rule 18.34(422,423). Excluded from the meaning of the word "computer" is any software consisting of an application program. For purposes of this subrule, "operating system or executive program" means a computer program which is fundamental and necessary to the functioning of a computer. The operating system or executive program software controls the operation of a computer by managing the allocation of all system resources, including the central processing unit, main and secondary storage, input/output devices, and the processing of programs. This is in contrast to application software which is a collection of one or more programs used to develop and implement the specific applications which the computer is to perform, and which calls upon the services of the operating system or executive program.

"Contract manufacturer" is any manufacturer who falls within the definition of "manufacturer" set out subsequently in this subrule except that a contract manufacturer does not sell the tangible personal property which it processes on behalf of other manufacturers.

"Directly used." Property is "directly used" only if it is used to initiate, sustain, or terminate an exempt activity. In determining whether any property is "directly used," consideration should be given to the following factors:

1. The physical proximity of the property in question to the activity in which it is used;

2. The proximity of the time of use of the property in question to the time of use of other property used before and after it in the activity involved; and

3. The active causal relationship between the use of the property in question and the activity involved. The fact that a particular piece of property may be essential to the conduct of the activity because its use is required either by law or practical necessity does not, of itself, mean that the property is directly used.

"Financial institution" is a bank incorporated under any state or federal law; a savings and loan association incorporated under any state or federal law; a credit union organized under any state or federal law; or any corporation licensed as an industrial loan company under Iowa Code chapter 536A. Excluded from the meaning of the term are loan brokers governed by Iowa Code chapter 535C and production credit associations.

"Insurance company" means an insurer organized or operating under Iowa Code chapter 508, 514, 515, 518, 518A, 519, or 520 or authorized to do business in Iowa as an insurer or as a licensed insurance agent under Iowa Code chapter 522. Excluded from the definition of "insurance company" are fraternal and beneficial societies governed by Iowa Code chapter 512 and health maintenance organizations governed by Iowa Code chapter 514B. This list of exclusions is not intended to be exclusive.

"Machinery and equipment" means machinery and equipment used by a manufacturer. Machinery is any mechanical, electrical, or electronic device designed and used to perform some function and to produce a certain effect or result. The term includes not only the basic unit of the machinery but also any adjunct or attachment necessary for the basic unit to accomplish its intended function. The term also includes all devices used or required to control, regulate, or operate a piece of machinery, provided such devices are directly connected with or are an integral part of the machinery and are used primarily for control, regulation, or operation of machinery. Jigs, dies, tools, and other devices necessary to the operation of or used in conjunction with the operation of what would be ordinarily thought of as machinery are also considered to be "machinery." See Deere Manufacturing Co. v. Zeiner, 247 Iowa 1264, 78 N.W.2d 527 (1956). Also see the definition of "replacement parts" infra. Machinery does not include buildings designed specifically to house or support machinery. Equipment is any tangible personal property used in an operation or activity. Nonexclusive examples of equipment are tables on which property is assembled on an assembly line and chairs used by assembly line workers.

"Manufacturer" means any person, firm, or corporation that purchases, receives, or holds personal property for the purpose of adding to its value by any process of manufacturing, refining, purifying, combining of different materials, or by packing of meats with an intent to sell at a gain or profit. Those who are in the business of printing, newspaper publication, bookbinding, lumber milling, and production of drugs and agricultural supplies are illustrative, nonexclusive examples of manufacturers. Construction contracting; quarrying; remanufacture or rebuilding of tangible personal property (such as automobile engines); provision of health care; farming; transportation for hire; mining; and the activities of restaurateurs, hospitals, medical doctors, and those who merely process data are illustrative, nonexclusive examples of businesses which are not manufacturers. See Associated General Contractors of Iowa v. State Tax Commission, 255 Iowa 673, 123 N.W.2d 922 (1963) and River Products Co. v. Board of Review of Washington County, 332 N.W.2d 116 (Iowa Ct. App. 1982). The term "manufacturer" includes a contract manufacturer.

"Pollution control equipment" means any disposal system or apparatus used or placed in operation primarily for the purpose of reducing, controlling, or eliminating air or water pollution. The term does not include any apparatus used to eliminate "noise pollution." Liquid, solid, and gaseous wastes are included within the meaning of the word "pollution." "Pollution control equipment" specifically includes, but is not limited to, any equipment the use of which is required or certified by an agency of this state or the United States Government. Wastewater treatment facilities and scrubbers used in smokestacks are examples of pollution control equipment. However, pollution control equipment does not include any equipment used only for worker safety (e.g., a gas mask).

"Processing" means a series of operations in which materials are manufactured, refined, purified, created, combined, transformed, or stored by a manufacturer, ultimately into tangible personal property. Processing encompasses all activities commencing with the receipt or producing of raw materials by the manufacturer and ending at the point products are delivered for shipment or transferred from the manufacturer. Processing includes, but is not limited to, refinement or purification of materials; treatment of materials to change their form, context, or condition; maintenance of the quality or integrity of materials, components, or products; maintenance of environmental conditions necessary for materials, components or products; quality control activities; construction of packaging and shipping devices; placement into shipping containers or any type of shipping device or medium; and the movement of materials, components, or products until shipment from the manufacturer.

"Processing or storage of data or information." All computers store and process information. However, only if the "final output" for a user or consumer is stored or processed data will the computer be eligible for exemption of tax.

"Receipt or producing of raw materials" means activities performed upon tangible personal property only. With respect to raw materials produced from or upon real estate, "production of raw materials" is deemed to occur immediately following the severance of the raw materials from the real estate.

"Recycling" means any process by which waste or materials which would otherwise become waste are collected, separated, or processed and revised or returned for use in the form of raw materials or products. The term includes, but is not limited to, the composting of yard waste which has been previously separated from other waste. "Recycling" does not include any form of energy recovery.

"Replacement parts." A "replacement part" is any machinery, equipment, or computer part which is substituted for another part that has broken, has become worn out or obsolete, or is otherwise unable to perform its intended function. "Replacement parts" are those parts which materially add to the value of industrial machinery, equipment, or computers or appreciably prolong their lives or keep them in their ordinarily efficient operating condition. Excluded from the meaning of the term "replacement parts" are supplies, the use of which is necessary if machinery is to accomplish its intended function. Drill bits, grinding wheels, punches, taps, reamers, saw blades, lubricants, coolants, sanding discs, sanding belts, and air filters are nonexclusive examples of supplies. Sales of supplies remain taxable.

"Research and development" means experimental or laboratory activity which has as its ultimate goal the development of new products or processes of processing. Machinery, equipment, and computers are used "directly" in research and development only if they are used in actual experimental or laboratory activity that qualifies as research and development under this subrule.

18.58(2) Exempt sales. On and after July 1, 1997, sales or rentals of the following machinery, equipment, or computers (including replacement parts) are exempt from tax:

a. Machinery, equipment, and computers directly and primarily used in processing by a manufacturer.

b. Machinery, equipment, and computers directly and primarily used to maintain a manufactured product's integrity or to maintain any unique environmental conditions required for the product.

c. Machinery, equipment and computers directly and primarily used to maintain unique environmental conditions required for other machinery, equipment, or computers used in processing by a manufacturer.

d. Test equipment directly and primarily used by a manufacturer in processing to control the quality and specifications of a product.

e. Machinery, equipment, or computers directly and primarily used in research and development of new products or processes of processing.

f. Computers used in processing or storage of data or information by an insurance company, financial institution, or commercial enterprise.

g. Machinery, equipment, and computers directly and primarily used in recycling or reprocessing of waste products.

h. Pollution control equipment used by a manufacturer. It is not necessary that the equipment be "directly and primarily" used in any kind of processing.

i. Materials used to construct or self-construct any machinery, equipment, or computer, the sale of which is exempted by paragraphs "a" through "h" above.

j. Exempt sales of fuel and electricity. Sales of fuel or electricity consumed by machinery, equipment, or computers used in any exempt manner described in paragraphs "a," "b," "c," "d," "e," "g," and "h" of this subrule are exempt from tax. Sales of electricity consumed by computers used in the manner described in paragraph "f" remain subject to tax.

18.58(3) Examples of exempt items. Sales of the following nonexclusive types of machinery and equipment, previously taxable, are exempt on and after July 1, 1997, if that machinery or equipment is sold for direct and primary use in processing by a manufacturer: coolers which do not change the nature of materials stored in them; equipment which eliminates bacteria; palletizers; storage bins; property used to transport raw, semifinished, or finished goods; vehicle-mounted cement mixers; self-constructed machinery and equipment; packaging and bagging equipment (including conveyer systems); equipment which maintains an environment necessary to preserve a product's integrity; equipment which maintains a product's integrity directly; quality control equipment and electricity or other fuel used to power the machinery and equipment mentioned above.

18.58(4) Processing--beginning to end.

a. The beginning of processing. Processing begins with a manufacturer's receipt or production of raw material. Thus, when a manufacturer produces its own raw material it is engaged in processing. Processing also begins when raw materials are transferred to a manufacturer's possession by a manufacturer's supplier.

b. The completion of processing. Processing ends when the finished product is transferred from the manufacturer or delivered for shipment by the manufacturer. Therefore, a manufacturer's packaging, storage, and transport of a finished product after the product is in the form in which it will be sold at retail are part of the processing of the product.

c. Examples of the beginning, intervening steps, and the ending of processing. Of the following, Examples A and B illustrate when processing begins under various circumstances; Example C demonstrates the middle stages of processing; and Example D demonstrates when the end of processing takes place.

EXAMPLE A. Company A manufactures fine furniture. Company A owns a grove of walnut trees which it uses as raw material. A's employees cut the trees, transport the logs to A's factory, offload them there, and store the logs in a warehouse (to begin the curing of their wood) before taking them to A's sawmill. The walnut trees are real property, Kennedy v. Board of Assessment and Review, 276 N.W. 205, 224 Iowa 405 (1937). Thus, no "production of raw materials" has occurred with regard to the trees until they have been severed from the soil and transformed into logs. In this example, "processing" of the logs begins when they are placed on vehicles for transport to A's factory. However, note that even though the transport vehicles are used in processing, if they are "vehicles subject to registration," their use is not exempt from tax. See 18.58(6)"d" infra.

EXAMPLE B. Company A from the previous example also buys mahogany logs from a supplier in Honduras. Company A uses its own equipment to offload the logs from railroad cars at its manufacturing facility and then transports, stores, and saws the logs as previously described in Example A. Processing begins when Company A offloads the logs from the railroad cars.

EXAMPLE C. Company C is a microbrewery. It uses a variety of kettles, vats, tanks, tubs, and other containers to mix, cook, ferment, settle, age, and store the beer which it brews. It also uses a variety of pipes and pumps to move the beer among the various containers involved in the activity of brewing. All stages of this brewing are part of processing whether those stages involve the transformation of the raw materials from one state to another, e.g., fermentation or aging, or simply involve holding the materials in an existing state, e.g., storage of hops in a bin or storage of the beer immediately prior to bottling. Also, any movement of the beer between containers is an activity which is a part of processing, whether this movement is an "integral part" of the production of the beer or not.

EXAMPLE D. After the brewing process is complete, Company C places its beer in various containers, stores it, and moves the beer to its customers by a common carrier that picks up the beer at C's brewery. C's activities of placing the beer into bottles, cans, and kegs, storing it after packaging, and moving the beer by use of a forklift to the common carrier's pickup site are activities which are part of processing.

18.58(5) Various unrelated inclusions in and exclusions from this exemption.

a. The following are nonexclusive examples of machinery which is not directly used in processing:

(1) Machinery used exclusively for the comfort of workers. Examples are air cooling, air conditioning, and ventilation systems.

(2) Machinery used in support operations, such as a machine shop, in which production machinery is assembled, maintained, or repaired.

(3) Machinery used by administrative, accounting, and personnel departments.

(4) Machinery used by plant security, fire prevention, first aid, and hospital stations.

(5) Machinery used in plant communications and safety.

b. The following is an example of property directly used in research and development. Frontier Hybrid, Inc. maintains a research and development laboratory for use in developing a corn plant which is a perennial. It purchases the following items for use in its research and development laboratory: a computer which will process data relating to the genetic structure of the various corn plants which Frontier Hybrid is testing, an electron microscope for examining the structure of corn plant genes, a "steam cleaner" for cleaning rugs in the laboratory offices, and a typewriter for use by the laboratory director's secretary. The computer and the microscope are "directly" used in the research in which the laboratory is engaged; the steam cleaner and the typewriter only indirectly used. Therefore, purchase of the computer and microscope would be exempt from tax; purchase of the steam cleaner and typewriter would be subject to tax.

c. The following is an example of computers used and not used in processing or storage of information or data. A health insurance company has four computers. Computer A is used to monitor the temperature within the insurance company's building. The computer transmits messages to the building's heating and cooling systems telling them when to raise or lower the level of heating or air conditioning as needed. Computer B is used to store patient records and will recall those records on demand. Computer C is used to tabulate statistics regarding the amount of premiums paid in and the amount of benefits paid out for various classes of insured. Computer D is used to train the insurance company's employees to perform various additional tasks or to better perform work they can already do. Computer D uses various canned programs to accomplish this. The "final output" of Computer A is neither stored nor processed information. Therefore, Computer A does not fit the definition of an exempt computer. The final output of Computer B is stored information. The final output of Computer C is processed information. The final output of Computer D is processed information consisting of the training exercises appearing on the computer monitor. The sale, lease, or use of Computers B, C, and D would qualify for exemption.

d. The following is an example of property not used in processing. A manufacturing plant located in Warren County which manufactures widgets fabricates its own patterns used in manufacturing the widgets on a metal press machine in its machine shop located in Story County. The machine shop does not sell the patterns, and the metal press machine is used for no other purpose than to fabricate the patterns. The metal press machine is not used in processing because there is no intent to sell the patterns used by the machine shop at a gain or profit.

18.58(6) Exceptions. Sales of the following machinery, equipment, or computers are not exempt:

a. Machinery, equipment, or computers assessed by the department of revenue and finance pursuant to Iowa Code chapters 428, 433, 434, and 436 to 438, inclusive. For electric, gas, water, and other companies assessed under Iowa Code chapter 428, only property owned by the company is assessed by the department. For railroad, telephone, pipeline, and electric transmission lines companies, property leased to, as well as owned by, the company is assessed by the department. See 701--Chapters 71 and 77.

b. Hand tools. These are tools which can be held in the hand or hands and which are powered by human effort.

c. Point-of-sale equipment. See 701--subrule 71.1(7).

d. Vehicles subject to registration, except vehicles subject to registration which are directly and primarily used in recycling or reprocessing of waste products.

e. Machinery and equipment purchased by a person engaged in processing who is not a manufacturer. Restaurants, retail bakeries, food stores, and blacksmith shops are nonexclusive examples of businesses which process tangible personal property but are not manufacturers as that word is defined for the purposes of this rule.

f. The fact that the acquisition cost of rented or purchased machinery, equipment, or computers can be capitalized for the purposes of Iowa or federal income tax law is not an indication that their sale or rental would be exempt from tax under this rule.

18.58(7) Lessor purchases of machinery, equipment, or computers. The analysis regarding lessor purchases of farm machinery and equipment contained in subrule 18.44(3) explains that same problem regarding machinery, equipment, and computers.

18.58(8) Designing or installing new industrial machinery or equipment. The gross receipts from the services of designing or installing new industrial machinery or equipment are exempt from tax. The enumerated services of electrical or electronic installation are included in this exemption. To qualify for the exemption, the sale or rental of the machinery or equipment must be subject to exemption under this rule. In addition, the machinery or equipment must be "new." For purposes of this subrule, "new" means never having been used or consumed by anyone. The exemption is not applicable to reconstructed, rebuilt, or repaired or previously owned machinery or equipment. The exemption is applicable to new machinery and equipment designed or installed for rental as well as for sale. The gross receipts from design or installation must be separately identified, charged separately, and reasonable in amount for the exemption to apply. A "computer" is not considered to be machinery or equipment, and its installation or design is not eligible for this exemption.

18.58(9) Property used in recycling or reprocessing of waste products. Gross receipts from the sale or rental of machinery (including vehicles subject to registration), equipment, or computers directly and primarily used in the recy-cling or reprocessing of waste products are exempt from tax. "Reprocessing" is not a subcategory of "processing."Reprocessing of waste products is an activity separate and independent from the processing of tangible personal property. Machinery or equipment used in the recycling orreprocessing of waste products includes, but is not limited to, compactors, balers, crushers, grinders, cutters, or shears directly and primarily used for this purpose. The sale of an end loader, forklift, truck, or other moving device is exempt from tax if the device is directly and primarily used in the movement of property which is an integral part of recycling or reprocessing. The sale of a bin for storage ordinarily would not be exempt from tax; storage without more activity would not be a part of recycling or reprocessing. Certain limits for exemption placed upon industrial machinery and equipment are not applicable to machinery and equipment used in recycling or reprocessing. For example, the exemption will apply even if the machinery, equipment or computer is purchased by a person other than an insurance company, financial institution or commercial enterprise. A person engaged in a profession or occupation could purchase property for direct and primary use in recycling or reprocessing of waste products and the exemption would apply.

a. By way of nonexclusive examples, recycling orreprocessing can begin when waste or material which would otherwise become waste is collected or separated. A vehicle used directly and primarily for collecting waste which will be recycled or reprocessed could be a vehicle used for an exempt purpose under this rule. Thus, the purchaser of a garbage truck could claim this exemption if the truck were directly and primarily used in recycling and not, for instance, in hauling garbage to a landfill. Machinery or equipment used to segregate waste from material to be recycled or reprocessed or used to separate various forms of materials which will be reprocessed (e.g., glass and aluminum) can also be used at the beginning of recycling or reprocessing.

b. Machinery and equipment directly and primarily used in recycling or reprocessing. See subrule 18.58(1) for the definition of "directly used" which is applicable to this subrule. The examples of machinery not directly used in processing set out in 18.58(5)"a" should be studied for guidance in determining whether similar machinery is or is not used in recycling or reprocessing; e.g., machinery used in plant security (see 18.58(5)"a"(4)) is not machinery directly used in recycling or reprocessing.

c. Integral use in recycling or reprocessing. Ordinarily, any operation or series of operations which does not transform waste or material which would otherwise become waste into new raw materials or products would not be a part of recycling or reprocessing. However, activities which do not do this, but are an "integral part" of recycling or reproc-essing, are themselves recycling or reprocessing. For example, an endless belt which moves aluminum cans from a machine where they are shredded to a machine where the shredded aluminum is crushed into blocks would be an endless belt used in recycling or reprocessing and the exemption applies. See subrule 18.29(5) for a discussion of when an activity is an integral part of "processing." Some of that discussion is applicable to this subrule.

d. The end of recycling or reprocessing. Recycling or reprocessing ends when waste or a material which would otherwise become waste is in the form of raw material or in the form of a product. For instance, a corporation purchases a machine which grinds logs, stumps, pallets, crates, and other waste wood into wood chips. After grinding, the wood chips are sold and transported to various sites where the chips are dumped and spread out over the ground for use in erosion control. The machine which grinds the wood chips is a machine used in recycling. The truck which transports the wood chips from the machine to the sites is not used in recycling because at the time the chips are placed in the truck they are in the form in which they will be used in erosion control.

This rule is intended to implement Iowa Code Supplement section 422.45(27) as amended by 1998 Iowa Acts, Senate File 2288; Iowa Code section 422.45(29); and Iowa Code chapter 423.

ARC 7992A

Notice of Intended Action was published in IAB, Volume XX, Number 19, on March 11, 1998, page 1716, as ARC 7886A.

This rule requires that the conference board notify the Director of Revenue and Finance of assessor appointments and reappointments and that an assessor notify the Director of appointments of deputy assessors.

This amendment is identical to that published under Notice of Intended Action.

This amendment will become effective June 10, 1998, after filing with the Administrative Rules Coordinator and publication in the Iowa Administrative Bulletin.

This amendment is intended to implement Iowa Code sections 441.6 and 441.10.

The following amendment is adopted.

Adopt the following new rule:

701--123.9(441) Director of revenue and finance notification. The chairperson of the conference board shall give written notice to the director of revenue and finance of the appointment or reappointment of an assessor and the effective date within ten days of the decision of the board, and the assessor shall give written notice to the director of the appointment of a deputy assessor and the effective date within ten days of the decision of the assessor.

This rule is intended to implement Iowa Code sections 441.6 and 441.10.

ARC 7964A

Notice of Intended Action for these amendments was published in the February 11, 1998, Iowa Administrative Bulletin as ARC 7795A.

Iowa Code Supplement section 321.11 prohibits the Department from releasing personal information, other than to law enforcement agencies, licensed private investigation agencies and licensed security services, when the request is made by plate number.

The first item amends the definition of law enforcement agency to include a division or unit of a government agency if the division's or unit's primary responsibility is to prevent or detect crime or enforce a criminal law of this state. This will allow these divisions or units to access a motor vehicle record via a plate number or validation sticker number.

A numbered year/month validation sticker is attached to and is considered part of a registration plate. The amendments in Item 2 make it clear that requests made by validation sticker number will be treated the same as requests made by plate number.

These amendments are identical to the ones published under Notice.

These amendments are intended to implement Iowa Code Supplement section 321.11.

These amendments will become effective June 10, 1998.

Rule-making actions:

ITEM 1. Amend rule 761--415.3(321), definition of "Law enforcement agency," as follows:

"Law enforcement agency" includes, but is not limited to, county attorneys, federal district attorneys, attorneys general, and state and federal departments of justice and a division or unit of a governmental agency if the division's or unit's primary responsibility is to prevent or detect crime or enforce a criminal law of this state.

ITEM 2. Amend subrules 415.4(8) and 415.4(9) as follows:

415.4(8) The department shall not release any personal information regarding a motor vehicle record if the request is made by plate number or validation sticker number, except as provided in Iowa Code section 321.11.

415.4(9) If a request for personal information is made by something other than plate number or validation sticker number, the personal information shall be disclosed if the individual whose personal information is requested has not elected to prohibit disclosure of the information to the general public.

ARC 7976A

Notice of Intended Action for these amendments was published in the February 25, 1998, Iowa Administrative Bulletin as ARC 7830A.

Iowa Code section 321.449 requires the Department to adopt rules consistent with the Federal Motor Carrier Safety Regulations promulgated under United States Code, Title 49, and found in 49 Code of Federal Regulations (CFR), Parts 390 to 399. Iowa Code section 321.450 requires the Department to adopt rules consistent with the Federal Hazardous Materials Regulations promulgated under United States Code, Title 49, and found in 49 CFR, Parts 107, 171 to 173, 177, 178 and 180. To ensure the consistency required by statute, the Department annually adopts the specified parts of 49 CFR as adopted by the United States Department of Transportation.

Commercial vehicles transporting goods in interstate commerce are subject to the Federal Motor Carrier Safety Regulations on the effective dates specified in the Federal Register. Commercial vehicles transporting hazardous materials in interstate commerce or transporting certain hazardous materials intrastate are subject to the Federal Hazardous Materials Regulations on the effective dates specified in the Federal Register. The adoption of the federal regulations by the Department will extend the enforcement of the regulations to commercial vehicles operated intrastate unless exempted by statute.

Proposed federal regulations are published in the Federal Register to allow a period for public comment, and, after adoption, the final regulations are again published in the Federal Register. Each year a revised edition of 49 CFR is published incorporating all of the final regulations adopted during the year. Although revised editions of 49 CFR are usually dated October or November, the publication is not actually available in Iowa for several months after that date.

The amendments to the Federal Motor Carrier Safety Regulations and Federal Hazardous Materials Regulations that have become final and effective since the 1996 edition of the CFR are listed in the information below. The parts affected are followed by Federal Register (FR) citations.

Parts 107, 171, 172, 173, 177, 178 and 180 (FR Vol. 61, No. 191, Page 51334, 10-1-96)

This final rule corrects editorial errors, makes minor regulatory changes, and in response to requests for clarification, improves the clarity of certain provisions to the Hazardous Materials Regulations.

Parts 172 and 173 (FR Vol. 61, No. 191, Page 51238, 10-1-96)

This final rule responds to petitions for reconsideration of the published final rule under Docket HM 220A, May 28, 1996, and clarifies testing frequency (12 years) for fire extinguisher(s). Companies that perform external visual inspections are not required to have copies of Compressed Gas Association (CGA) pamphlets C-6 or C-6.3; however, it is strongly recommended.

Part 171 (FR Vol. 61, No. 242, Page 65958, 12-16-96)

This final rule updates references in the Hazardous Materials Regulations to include the most recent amendments to the International Maritime Dangerous Goods Code (IMDG) and the International Civil Aviation Organization's (ICAO) Technical Instructions for the Safe Transportation by Air.

Parts 171, 173 and 180 (FR Vol. 62, No. 5, Page 1208, 1-8-97)

This final rule requires all intrastate shippers and carriers to comply with the Hazardous Materials Regulations with certain exceptions. It defines agricultural products, farmer, material of trade, and allows for the use of non-specification containers for flammable liquid petroleum products in intrastate commerce. This is referenced in pending legislation (states are to adopt prior to July 1, 1998).

Parts 171, 172, 173 and 177 (FR Vol. 62, No. 5, Page 1217, 1-8-97)

This final rule amends the Hazardous Materials Regulations to better identify hazardous materials in transportation, adds a new poison inhalation label and placard, and lowers the quantity for a specific hazard class placarding from 5,000 pounds to 2,205 pounds of Table 2 items. Implementation of this rule has been delayed by a later rule making.

Parts 107 and 171 (FR Vol. 62, No. 13, Page 2970, 1-21-97)

This final rule increases the civil penalty amount the Research and Special Programs Administration (RSPA) may assess from $25,000 to $27,500.

Part 171 (FR Vol. 62, No. 33, Page 7638, 2-19-97)

This interim final rule amends the Hazardous Materials Regulations to specify the conditions under which certain cargo tank motor vehicles may be used on an interim basis. This rule has been extended until March 1, 1999, by a later rule making.

Parts 172, 173 and 178 (FR Vol. 62, No. 58, Page 4334, 3-26-97)

This final rule corrects errors in the September 26, 1996, final rule.

Parts 171, 172, 173 and 178 (FR Vol. 62, No. 87, Page 24690, 5-6-97)

This final rule amends the Hazardous Materials Regulations to maintain alignment with corresponding provisions of IMDG and ICAO. These revisions are necessary to facilitate the transportation of hazardous materials in international commerce.

Part 171 (FR Vol. 62, No. 105, Page 29673, 6-2-97)

This final rule allows the transportation of certain hazardous materials in non-specification open-head fiber drums until September 30, 1999.

Parts 171 and 172 (FR Vol. 62, No. 108, Page 30767, 6-5-97)

This final rule adds a specific shipping description to the Hazardous Materials Table for chemical oxygen generators. (Oxygen Generator, Chemical, 5.1, UN 3353 Packing Group 1 or 11)

Parts 171 and 172 (FR Vol. 62, No. 124, Page 34667, 6-27-97)

This final rule corrects the typographical error for the ID number for Chemical Oxygen Generators (correct ID number is 3356). Also, the effective compliance date was delayed from July 7, 1997, until August 7, 1997.

Parts 391 and 392 (FR Vol. 62, No. 133, Page 37150, 7-11-97)

FHWA is making technical amendments to physical qualification, examination and controlled substance/alcohol use testing regulations for drivers under the commercial driver's license program. The amendments are necessary to correct minor errors and to remove obsolete regulations.

Parts 171 and 172 (FR Vol. 62, No. 140, Page 39398, 7-22-97)

This rule changes the effective date of the January 8, 1997, final rule. The final rule is delayed until October 1, 1998, and beyond.

Included in the October 1, 1998, compliance date are identification numbers for nonbulk hazardous materials loaded at one facility, poison inhalation hazard (PIH) material, enclosed vehicle containing a cargo tank or intermediate bulk package and fumigant marking and reduction of 2,268 kg (5,000 lbs.) to 1,000 kg (2,205 lbs.) for placard requirements for Table 2 items. Carriers must instruct employees to contact the company in the event of a hazardous materials incident, which requires shipping paper and emergency response information for trailers/vehicles separated from their motive power and parked at a location other than the consignee's, consignor's or carrier's facility.

PIH labels will be required as of October 1, 1999. The PIH placard and prohibition on the displaying of extraneous information on placards or placard holders will become effective on October 1, 2001.

Part 171 (FR Vol. 62, No. 159, Page 44037, 8-18-97)

This final rule extends the date of the rule issued February 19, 1997, until March 1, 1999. Requirements include a radio transmitter that can activate the closure of the internal self-closing stop valve, and the operator remains within the operating range of the transmitter and has an unobstructed view of the cargo tank motor vehicle at all times that the internal stop valve is open.

A cargo tank motor vehicle that has an emergency discharge system conforming to the requirements in Section 178.337-11(a)(1)(I) of this subchapter may be operated under the provisions of this paragraph.

A comprehensive written emergency operating procedure must be developed for all transfer operations, and hazardous materials employees who perform unloading functions must be trained in its provisions. The emergency procedure must be prominently displayed in or on the cargo tank motor vehicle.

Continuing Qualification--An existing in-service cargo tank motor vehicle may continue to be marked and documented as required by Part 180 of this subchapter if the following statement is added to the Certificate of Compliance by the owner or operating motor carrier, "Emergency excess flow control performance not established for this unit."

New Cargo Tank Motor Vehicles--A new cargo tank motor vehicle manufactured, marked and certified prior to March 1, 1999, may be marked and certified as conforming to specification MC 331 if it otherwise meets all requirements of the specification and the following statement is added to the certification document, "Emergency discharge control performance not established for this unit."

The following marking must be displayed on a cargo tank motor vehicle used or represented for use under this section: "Operating Under 49 CFR 171.5."

Part 172 (FR Vol. 62, No. 167, Page 45702, 8-28-97)

This rule makes a technical correction.

Parts 172 and 177 (FR Vol. 62, No. 169, Page 46214, 9-2-97)

This direct final rule removes the Radiation Protection Program regulations and related modal provisions that require the development and maintenance of a written radiation protection program for persons who offer, accept for transportation, or transport radioactive materials. This action is necessary to address difficulties and complexities concerning implementation of and compliance with the requirements for a radiation protection program.

Parts 171 and 173 (FR Vol. 62, No. 183, Page 49559, 9-22-97)

This final rule changes the compliance date from October 1, 1997, to October 1, 1998. It also contains some technical amendments and responses for reconsideration. These were printed in the October 1, 1997, Hazardous Materials Regulations.

Part 390 (FR Vol. 62, No. 185, Page 49939, 9-24-97)

This document makes technical amendments to correct references within several parts to subchapter B.

The following sentence will be deleted: "49 CFR Sections 391.109 and 391.111 concerning random drug testing shall not apply to intrastate operations." This no longer applies since the intrastate exemption was preempted by the Omnibus Transportation Employee Testing Act of 1991, which requires employers to test drivers for the illegal use of controlled substances when the drivers are required to obtain a commercial driver's license (CDL). In a final rule (FR Vol. 61, 3-8-96), the Federal Highway Administration (FHWA) preempted state and local laws concerning drug testing of CDL drivers.

These amendments are identical to the ones published under Notice.

These amendments are intended to implement Iowa Code chapter 321.

These amendments will become effective June 10, 1998.

Rule-making actions:

Amend subrule 520.1(1), paragraphs "a" and "b," as follows:

a. Motor carrier safety regulations. The Iowa department of transportation adopts the Federal Motor Carrier Safety Regulations, 49 CFR Parts 390-399 (October 1, 1996 1997). 49 CFR Sections 391.109 and 391.111 concerning random drug testing shall not apply to intrastate operations.

b. Hazardous materials regulations. The Iowa department of transportation adopts the Federal Hazardous Materials Regulations, 49 CFR Parts 107, 171-173, 177, 178, and 180 (October 1, 1996 1997). The regulations in the October 1, 1990, edition of Title 49 CFR shall remain in full force and effect in accordance with the transition provisions of 49 CFR Section 171.14 (December 31, 1991).

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