EDUCATIONAL EXAMINERS, Licensure eligibility, 1185B, 12/12/01 IAB, ADOPTED.

Background. The Board of Educational Examiners implements rules which authorize either the denial of a license or the imposition of discipline based on a criminal conviction or a founded report of child abuse. The board licenses both educators and administrators.

Commentary. This filing sets out five criteria for the board to use in determining whether a person should be denied a license or whether a licensee should be disciplined based upon a criminal conviction or founded report of physical or sexual abuse of a child. When initially reviewed as a notice, committee members felt that a criminal conviction of child sexual abuse should automatically result in license revocation or denial. Board representatives cited Iowa Code section 272.2(14) which clearly makes action discretionary, not mandatory. Board representatives did concede that Iowa chapter 272 itself has conflicting language on this point. Code section 272.6, relating to initial licensure, makes conviction of a felony or conviction of child sexual abuse an automatic disqualification for licensure. The assistant attorney general for the board noted that courts have found both equal protection and due process problems in making disqualifications automatic. Committee members felt that on the point of a criminal conviction for child abuse, there is clear legislative intent that disqualification be automatic, even though the statute may be otherwise ambiguous.

Action. In order to allow the General Assembly an opportunity to deal with this issue and resolve the discrepancy, the Committee imposed a session delay on this filing.

ENVIRONMENTAL PROTECTION COMMISSION, Discarded appliance demanufacturing, ARC 1192B, 12/12/01 IAB, ADOPTED.

Background. Refrigerators or other household appliances often contain the carcinogen PCB, freon, mercury, or other hazardous substances. Under the 1990 regulations, demanufacturers had to register with the Environmental Protection Division and comply with applicable federal requirements. These rules were the subject of a regulatory analysis published in the 10/17/01 IAB.

Commentary. The EPC has completely revised this program, establishing a permit program for the "demanufacture" of discarded appliances (disassembling an appliance and removing the hazardous materials). Anyone wishing to enter this business must obtain the permit prior to starting operation. The rules require that all electrical parts containing PCBs or containing mercury and refrigerants be removed prior to those parts being recycled or scrapped. Oils, gasses, refrigerants, and other hazardous materials removed from discarded appliances must be stored and recycled or disposed of according to specific federal regulations. Commission representatives contend that the recycling requirements are already embodied in federal requirements; they stated the rules actually do little more than mandate recordkeeping to ensure compliance with federal law.

It was noted that the value of the scrap material is far outweighed by the cost of demanufacturing; therefore, these rules will have a financial impact on landfills. Landfill representatives support the program and expressed a willingness to meet the required expense. Supporters stated that the new program had been drafted by a broad-based committee with all interests represented. Opponents contended that reputable recyclers already safely remove hazardous materials and that the higher costs of compliance would actually increase unlawful disposal. They also contended the requirements would encourage the use of out-of-state scrappers where the lack of regulation would make disposal more economical.

Action. The Committee imposed a 70-day delay. Further review is scheduled for March 2002.

GENERAL SERVICES/PUBLIC SAFETY DEPARTMENT, Security on the Capitol Complex, SPECIAL REVIEW.

Background. Under Iowa Code section 18.10 the Department of General Services holds the authority to regulate public use of the Capitol building and grounds. In order to increase the level of security of the Capitol Complex, the Department of Public Safety has requested the Department of General Services to promulgate a set of rules detailing the procedure to be followed to gain access to the Capitol. Since Code section 18.10 specifically applies only to the public, these provisions do not apply to public officials or employees of the legislative, executive, or judicial branches of government. In order to have the security measures operational at the beginning of the legislative session, the rules will be filed on an emergency basis. A full rulemaking will be instituted promptly and the rule may be revised in light of additional public comment.

Commentary. Under these rules access to state buildings on the Capitol Complex may be limited to particular hours and particular entrances. Any member of the public entering a building on the Capitol Complex may be required to provide identification, to allow scanning with metal detecting equipment, and to allow anything which the person is bringing into the building to be examined with x-ray equipment or examined manually. Persons in a state building after hours may be required to provide identification and explain the nature of that person's business in the state building.

Briefcases or containers may no longer be left unattended after normal hours; those items will be confiscated and may be destroyed. Briefcases or containers left unattended while a state building is open may be examined. Only persons with a specific employment need and proper authorization to be armed may bring a dangerous weapon into a building on the Capitol Complex. Such weapons may be in a vehicle inside a closed and fastened container or securely wrapped package which is too large to be concealed on the person or inside a cargo or luggage compartment where the firearm will not be readily accessible.

Action. No action taken.

HUMAN SERVICES DEPARTMENT, New field operations areas, ARC 1155B, 12/12/01 IAB, NOTICE.

Background. As part of the overall budget reduction, the department is reorganizing its field offices into eight clusters.

Commentary. The five regional offices and the 38 existing county clusters will be replaced by eight service areas, eliminating the positions of the regional administrators and the human services area administrators. Roughly 37 local county offices are projected to become less than full-time offices. Department representatives noted that counties are being consulted concerning placement within a cluster. Those consultations will continue through March, with a number of changes already being made.

Action. No action taken.

LABOR DIVISION, "LULA" elevators in church facilities, 875 IAC 72.19, selective review.

Background. Since 1983, Iowa rules allowed the installation of residential elevators in certain public buildings for use only by handicapped individuals. This exception was utilized mainly by small churches which otherwise had no affordable means to bring infirm members into the building. The rule had numerous restrictions prohibiting any expanded or general public use.

In April 2001 the division rescinded its rule authorizing this use of residential elevators and adopted by reference a standard for "limited use/limited application" (LULA) elevators.

Commentary. In response to complaints from a number of small churches, the Committee reviewed the LULA requirement. Division representatives defended the requirement, stating that the LULA is less expensive than a commercial elevator, but is also sturdier than a residential elevator and has a greater lifting capacity. It was noted that a powered wheelchair and its occupant can easily outweigh the limits of a residential elevator. It has a fully enclosed compartment and a sliding door. Division representatives contend that the safety features in a LULA elevator justify eliminating residential elevators as an option.

The Committee heard testimony from representatives from a small rural church serving 200 members. They disputed the division's cost estimates of $18,000-$23,000 for a LULA elevator, noting that the quote for their church was $50,000. The church representatives also stated that the residential elevator they had initially chosen was marketed as being suitable for church use. They also noted that the variance procedure, used to request an exception, is slow and unproductive, leaving them with no alternative except to either litigate or install the LULA elevator.

Action. No action taken.

PUBLIC SAFETY DEPARTMENT, Fire safety: bed and breakfast facilities, ARC 0566B, 05/16/01 IAB, ADOPTED.

Background. Bed and breakfast homes and inns are basically tiny hotels. Homes may have no more than four guest families, inns no more than nine guest rooms. In keeping with their unique status, Iowa law calls on the Fire Marshal to develop limited fire safety rules for these facilities. At the request of the department, a session delay was imposed on these rules at the June ARRC meeting, in order to allow the department to develop compromises with the innkeeper groups.

Commentary. The rules will be amended to allow battery-operated smoke detectors in existing facilities, dropping the interconnection requirement. However, the department insists that each story have two separate exits; emergency ladders are not acceptable. Committee members were concerned that the two-exit requirement could impose a serious cost. Members determined not to rescind the session delay until the various innkeeper groups are consulted.

Action. Session delay remains in place. Further review is likely.

Next Meeting. The Administrative Rules Review Committee will meet Friday, February 8, 2002, in Statehouse room 116.

ECONOMIC DEVELOPMENT DEPARTMENT, Negotiated Awards, ARC 1079B & 1080B, 10/14/01 IAB, NOTICE.

Background. Traditionally, DED programs awards were made based on the use of weighted criteria and the award going to the applicant with the most points.

Commentary. Proposed amendments to the New Jobs and Income Program and the Enterprise Zone Program contain a set of negotiation criteria for the two programs. Under this concept the criteria do not determine the amount of the benefit; instead, the criteria establish a framework to negotiate the benefit on a case-by-case basis. This process combines the predictability of rulemaking policy with the flexibility of individual decisionmaking. Committee members expressed great concern that too much discretion is being given to the program evaluators; members expressed strong support for the use of objective criteria. Department officials note the negotiations do not select the projects themselves, instead they determine the precise level of benefits and services provided to a particular project, thus tailoring the award to the needs of the applicant.

Action. No action taken, additional review is anticipated on adoption of these rules.

HUMAN SERVICES DEPARTMENT, Medicaid Reimbursement for Nurse-Midwives, ARC 1087B, 11/14/01 IAB, NOTICE.

Background. Medicaid policy is being revised to more freely utilize a nurse-midwife as an alternative to a physician.

Commentary. The rules expand the services which may be provided by nurse-midwives under the Medicaid Program. The current requirement that the mother visit a physician twice is eliminated, along with a requirement that services be provided only in a hospital or birthing center. It was noted that reimbursement should be limited to certified nurse-midwives who hold that designation under Iowa law. Nurse-midwives also commented the rules should be loosened further to allow care for the newborn infant and to further expand the locations where nurse-midwife services may be performed.

Action. No action taken, additional review is anticipated on adoption.

HUMAN SERVICES DEPARTMENT, Termination of Burial Benefits, ARC 1131B, 11/28/01 IAB, NOTICE.

Background. The department has traditionally provided a burial benefit of up to $400 for its clientele.

Commentary. As part of the budget reduction this benefit is being eliminated. This action may impact Iowa counties since indigent persons may request funds from county general relief. Department representatives also noted the burden placed on funeral homes who already lose money on the $400 reimbursement.

Action. No action taken.

IOWA FINANCE AUTHORITY, 2001 Tax Credit Program, ARC 1074B, 10/31/01 IAB, ADOPTED.

Background. This is the fifth review of the state allocation for the 2002 federal Low-Income Housing Tax Credit Program. The only remaining issue was the revision of a rule AFTER completion of the notice

Commentary. Subrule 6.3(2) was amended after the notice was complete by reducing the points available for projects intended for tenant ownership from 35 to 15. A developer protested this change, contending the change was improper since it was not part of the public comment and did not appear under notice. The developer was particularly concerned over a current application designed to complement a similar project already underway. He was concerned the loss of these 20 points would imperil the project. Iowa law has long limited the extent to which a notice of intended action can be modified in final adoption, and the ARRC has traditionally voted an objection in situations where the members feel the revision has been too extensive. However, in this situation, with only 20 points difference out of hundreds available, there was general agreement to see whether the 20 points in fact makes a difference on final evaluation for 2002. If no harm arises from this change, it was agreed no further review would be needed.

Action. No action, further review is unlikely.

PUBLIC HEALTH DEPARTMENT, Transportation of Radioactive Waste, ARC 0597B, 04/07/01 IAB, ADOPTED.

Background. The rule imposes a series of fees that shippers must pay when transporting nuclear waste across Iowa. The department maintains the fees are needed to generate funds to train personnel -- local law enforcement, fire departments, and emergency medical personnel -- to safely respond to emergencies relating to this waste. The fee varies with the type of waste, with the highest fee imposed on the movement of high-level waste. In July the Committee imposed a session delay on the collection of this fee, in order to allow representatives of the department and the shipping industry an opportunity to resolve differences over the fee structure.

Commentary. Following five months of discussion, the department proposes to retain the $1,750 fee for high-level waste, but reduce the fee for low-level waste from $250 to $50 per load, with the possibility of negotiating an annual single fee for multiple shipments, with a July 1, 2002, implementation. These amendments appear to be acceptable to all affected parties.

Action. The session delay has not been rescinded. However, with the adoption of these amendments early in 2002, the issue will be resolved.

RACING AND GAMING COMMISSION, Listing of Purse Winners, ARC 1078B, 11/14/01 IAB, NOTICE.

Background. A newspaper editorial complained that Prairie Meadows, a horse track and casino located in Polk County, demanded $25 per hour to provide a breakdown of purse money won by horse owners. At its August meeting, the Committee discussed whether the Racing and Gaming Commission should, by rule, collect and maintain this information and disseminate it as an open record. Committee members suggested that persons wishing this information should file a petition for rulemaking, requesting the commission demand this information from Iowa tracks.

Commentary. In response to a petition for rulemaking, the commission now proposes that tracks must submit to the commission the identity and address of each owner, together with the amount won. The information must separate Iowans from non-Iowans and be organized according to the level of winnings. Reported winnings must include any amounts received from the Iowa-bred fund. Representatives from Iowa's dog tracks vigorously oppose this proposal on two grounds. First, they contend that racing dogs have multiple owners and to monitor the winnings of each owner would be extremely expensive. Those representatives do note that it would be feasible to identify the single entity to whom a purse check is issued. The second issue raised by track representatives is the regulatory authority of the agency. They stated that the regulatory purpose of the commission is satisfied by the licensing of each dog owner, and that the amounts won by each owner is immaterial to the regulatory function of the agency. Committee members noted that the specific issues revolved around the Prairie Meadows track; commission representatives responded that in drafting regulations, all tracks must be treated equally.

Action. No action taken, further review is likely when the rule is adopted in final form.

Next Meeting. The Administrative Rules Review Committee will meet Tuesday, January 8, 2002 in Statehouse Room 116. The following special review will take place:

Labor Divison- Rule 72.19: The committee will discuss limited use-limited access (LULA) elevators in churches. Previously, small churches were allowed to install residential elevators at less cost than other alternatives. The division states that "LULA" elevators are an economical and safer alternative to residential elevators.

CHIROPRACTIC BOARD, Physiotherapy, ARC 1027B, 10/17/01 IAB, ADOPTED.

Background. Since 1984, Iowa Code § 151.1 has authorized the use of "chiropractic physiotherapy procedures." In an amendment to its advertising rules, the board restricts the use of the term "physical therapy," but allows the use of the term "physiotherapy." The proposal also notes that "representations regarding physiotherapy … may be the same as, or similar to, physical therapy or physical medicine." Earlier efforts by the board to define the term "chiropractic physiotherapy" in rule have been unsuccessful. In the Legislature, House Study Bill 188 proposes to limit the use of the term "physical therapy" or "physiotherapy." Commentary. Representatives of the physical therapy profession oppose this proposal; first, because it does not completely ban the use of the phrase "physical therapy" and second, because they contend that the word "physiotherapy" is synonymous with the term "physical therapy" and therefore is part of the practice of physical therapy, not chiropractic. They also contend that it is inappropriate to engage in rulemaking on this issue while legislation in pending before the General Assembly.

Action. A motion to impose a session delay on this provision failed.

ENVIRONMENTAL QUALITY COMMISSION, Regulatory Analysis: Disposal of White Goods, 10/17/01 IAB.

Background. In May the EPC proposed a complete revision of its regulation relating to the disposal of household appliances known as "white goods." At its June meeting the ARRC requested a regulatory analysis on the costs and benefits associated with this proposal. That action forestalled this rulemaking effort until the analysis was completed. The rules are now eligible to be adopted in final form.

Commentary. The analysis provides a general overview of federal regulation, generally noting that some of the material in white goods must, under current law, be treated as hazardous waste. The analysis does not provide any hard data or dollar figures, providing instead conclusions and assumptions concerning the impact. Commission representatives contended that the recycling requirements are already embodied in federal requirements; they stated the rules actually do little more than mandate recordkeeping to ensure compliance with federal law. The representatives also noted that the proposal would be amended to reflect public comment, with adoption of the final rule later in November.

Action. Further review at the January meeting.

HUMAN SERVICES DEPARTMENT, Care Facilities, Standards of Care, ARC 1054B, 10/31/01 IAB, NOTICE.

Background. Earlier this year the department implemented a "case-mix" formula for the reimbursement of care facilities. While that rulemaking established the formula for reimbursement, there remained the problem of developing a system of bonus payments to award those facilities providing superior care.

Commentary. These rules set out a process to collect data for measuring quality of life in a facility based on a nursing facility’s achievement of multiple "favorable outcomes" as determined by these measurements. Ten individual factors are considered. Based on these outcomes, reimbursement may be increased by as much as 3 percent of the reimbursement median. Information will be gleaned from Inspections and Appeals reports, ombudsman reports, care review committees, and the residents themselves.

Action. No action taken.

HUMAN SERVICES DEPARTMENT, Field Reorganization, SPECIAL REVIEW.

Background. The Governor’s Executive Order 24 has mandated an across-the-board cut of 4.3 percent of executive branch appropriations. To minimize the impact on line staff, the department has implemented emergency rules reducing and streamlining the supervisory and support structure.

Commentary. The current DHS regional structure includes five regional offices and 38 county clusters; this structure is replaced by eight service areas. These areas will be headquartered in: Ames, Marshalltown, or Fort Dodge; Cedar Rapids; Council Bluffs; Davenport; Des Moines; Dubuque; Mason City or Waterloo; and Sioux City. The positions of regional and area administrators will be eliminated. In each new area a service area manager position is created, supported by a social work supervisor, an income maintenance supervisor, a community liaison, a personnel and business management specialist, a quality assurance consultant, and a secretary. This staff will travel widely within its area. Thirty-seven local county offices will become part-time offices.

Action. No action taken at this informal review; additional discussion at the December meeting.

IOWA FINANCE AUTHORITY, 2001 Tax Credit Program, ARC 1074B, 10/31/01 IAB, ADOPTED.

Background. This is the fourth review of the state allocation for the 2002 federal Low-Income Housing Tax Credit Program.

Commentary. Following four intensive reviews the only matter left in contention is an amendment added to subrule 6.3(2) after the notice was complete -- meaning that the public had no opportunity to comment on this change. At issue is a provision allowing scoring points for projects intended for eventual tenant ownership. In previous years this criteria might provide up to 35 points. In the adopted rule this was reduced to 15 points. A developer protested this change, contending the change was improper since it was not part of the public comment and did not appear under notice. The developer has requested that the Committee object to this change on the grounds that it exceeds the scope of the notice. Under Iowa law even substantial changes in the original notice may be made so long as they are in character with the original scheme and a logical outgrowth of the notice and comment already given. This particular issue had not been previously discussed, and Committee members wished additional time to consider this allegation. For that reason further review was scheduled for the committee’s December meeting.

Action. No action, pending further review.

PUBLIC HEALTH DEPARTMENT, State Plumbing Code, ARC 0982B, 10/03/01 IAB, ADOPTED.

Background. The Iowa Department of Public Health is charged with maintaining a plumbing code setting the minimum standard for Iowa’s cities. For years the department has adopted by reference the model "Uniform Plumbing Code"(UPC), updating it periodically as the model was revised. This is the first revision since 1994.

Commentary. This filing began as a routine effort to update the 1994 edition of the uniform plumbing code to the 2000 model. Controversy arose when representatives of a second code, the "International Plumbing Code" (IPC), suggested that the IPC be adopted as the state minimum code and be designated as an alternative to the UPC. They cited the advantages as including an entire family of interrelated building codes and the fact that a number of Iowa cities, including West Des Moines, have already adopted the IPC. Department representatives defended the continued use of the UPC, stating that it was easier to use because it did not require reference to other manuals and set out specific requirements instead of more general performance standards.

Action. No action; a motion to impose a session delay on this update failed.

• Iowa Finance Authority-Rule 6.3(2). The Committee will discuss amendments to this rule that were not placed under notice.
• Labor Division-Rule 72.19. The Committee will discuss limited use-limited access (LULA) elevators in churches. Previously small churches were allowed to install residential elevators at lower cost. The division states that "LULA" elevators are an economical and safer alternative to residential elevators
• Public Health Department-ARC 597B. Portions of this filing, relating to fees for transporting nuclear waste were delayed at the committee’s July meeting. This review will include discussion of a compromise that has been worked out between the department and waste shippers.

EDUCATION EXAMINERS, Licensure eligibility, 0910B, 09/05/01 IAB, NOTICE.

Background. The board proposes rules authorizing either the denial of a license or the imposition of discipline based on a criminal conviction or a founded report of child abuse. The board licenses both educators and administrators.

Commentary. This rule sets out five criteria for the board to use in determining whether a person should be denied a license or whether a licensee should be disciplined based upon a criminal conviction or founded report of physical or sexual abuse of a child. Committee members suggested that a founded report of child sexual abuse should automatically result in license revocation or denial. Board representatives cited Iowa Code §272.2(14) which clearly made action discretionary, not mandatory. Board representatives did concede that Iowa Code chapter 272 itself has conflicting language on this point. Iowa Code section 272.6, relating to initial licensure, makes conviction of a felony or (conviction) of child abuse or child sexual abuse an automatic disqualification for licensure. Board representatives stated this discrepancy should be corrected legislatively and assured committee members that the board would review any founded report of abuse very carefully.

Action. No action taken.

EDUCATION DEPARTMENT, Standards for educational programs, 0899B, 09/05/01, ADOPTED.

Background. In a series of rulemaking proceedings the department has moved away from specific curriculum requirements for teacher preparation, in favor of competency-based evaluation instead of detailed preparation requirements. This particular filing relates to administrator licensing.

Commentary. Department representatives noted that preparation programs are moving away from specific curriculum requirements; instead, they now identify a series of competencies that a candidate must master along with specific areas of knowledge. Some committee members expressed reservation about the lack of specific standards, noting that the evaluator will now have broad discretion to approve educational programs, leading to a wide diversity of preparation programs. Committee members expressed some concern that administrator preparation could lose its focus on education in favor of a more management-oriented approach.

Action. No action taken.

ENVIRONMENTAL QUALITY COMMISSION, Manure management plans, ARC 0938B, 09/19/01 IAB, NOTICE.

Background. Under current law, only large confinement operations must have a manure management plan on file and approved before construction. This amendment would require smaller facilities to have a management plan on file with the commission and the county, but no approval is required.

Commentary. With this amendment, medium-sized facilities (over 200,000 pounds swine, 400,000 cattle), which are not required to obtain a permit, must submit a manure management plan before construction. Submittal is not required until well after construction has already occurred. No approval of this plan is required, but commission representatives did note that the change would require these facilities to plan for manure disposal as part of the construction process, instead of simply treating disposal as an afterthought. This proposed change is a compromise in response to a petition for rulemaking calling for the preconstruction filing of plans for all facilities.

ETHICS AND CAMPAIGN DISCLOSURE BOARD, Political activity by board and staff, 0906B, 09/05/01 IAB, NOTICE.

Background. Current rules prohibit a member of the board or staff from making political contributions or attending political events except for contributions to federal candidates or attendance at federal events. Iowa Code chapter 68B imposes no special limits on board personnel. Iowa Code §19A.18 prohibits any political activity by a merit system member while on duty; this restriction is not applicable to board or commission members.

Commentary. This proposal would permit a member of the board or staff to make annual contributions of up to $100 per committee to Iowa candidate committees and would allow board members or staff to attend a political event if the cost falls within the $100 annual limit. This amendment retains current provisions prohibiting personal endorsements of a state or local candidate or taking a position on a ballot issue. Committee members had mixed reactions to this proposal, with some favoring the change while others felt that it is inappropriate for a board member or employee to actively support a candidate that might later be subject to board discipline. Committee members did agree that the current restrictions could be loosened, and support was voiced for allowing donations to political parties and for attendance at political events that do not support a specific state or local candidate.

Action. No action taken.

GENERAL SERVICES, State agency purchases from Iowa Prison Industries, SELECTIVE REVIEW.

Background. Iowa Code §904.808 specifically provides that state agencies must buy products from Iowa Prison Industries (IPI) if IPI offers a product of comparable quality, cost, and delivery timeline. In the area of modular furniture, General Services traditionally negotiates price contracts with Iowa vendors and state agencies simply "buy off the contract," directly from the vendor, for their modular furniture needs.

Commentary. Following discussions with IPI representatives, the Department of General Services implemented the following new policy relating to the purchase of used modular furniture: Existing contracts with private vendors would not be renewed. For purchases under $5,000, agencies could purchase directly from Prison Industries or a targeted small business vendor. For purchases over that amount, a bid process would be used in which IPI would have an opportunity to bid. Prison Industries also announced a program to centralize the storage of all unused modular items and offer those to agencies on an as-needed basis. It was estimated that several years’ inventory could be acquired in this way. This policy does not apply to some agencies, including the Department of Transportation and the Board of Regents.

Discussion. This plan was opposed by local vendors who feel that IPI is given an unfair advantage. They contend that the negotiated contract offered high-quality products to state agencies at a good price. The vendors cited the employment they provide in rebuilding the modular equipment to a like-new condition. The vendors also contend that the Department of General Services contract provided a fair means to set product price and that no agency is compelled to purchase from them if it chose to buy from IPI instead. The vendors felt that especially on the smaller purchases where no competition is provided, the prices charged by either IPI or the targeted small businesses would be excessive when compared to the current contract price. IPI representatives defended the new policy, citing their obligation to provide labor to prison inmates and their need to make a profit on that work as a self-sustaining operation. IPI has now developed the capability to refurbish modular furniture and has shortened its delivery time. For these reasons, and noting that it will issue a waiver for any product it cannot provide in a timely manner at a competitive price, IPI representatives felt that the new policy is a fair mechanism for marketing modular furniture to state agencies.

Action. This issue did not involve a particular rule, no action taken.

INSPECTIONS AND APPEALS, Gambling by qualified organizations, ARC 0892B, 08/22/01 IAB, NOTICE.

Background. Under Iowa Code chapter 99B, some gambling is permitted, with special provisions regulating gambling by "qualified organizations," i.e., bona fide nonprofit organizations. The proposed rules correct earlier provisions that had been outdated by legislative amendments to Iowa Code chapter 99B.

Commentary. The proposed rule itself was not controversial, except as it related to raffle tickets. Both the rule and statute limit the cost to one dollar per ticket. However, by informal opinion the department also added a prohibition against "discounting" the price; citing the requirement that games must be "fair and honest," the department contended that charging different prices for a raffle ticket is inherently unfair to those paying the higher price. Committee members stated that regardless of the merit of this contention, this policy must be adopted as a rule to be valid. Members also noted that the most common of these discounts, six tickets for the price of five, is so widespread that it would now be unreasonable to declare it unlawful. Members suggested that a discount made equally available to all persons, at the commencement of the raffle, should be allowed.
More generally, representatives from charitable organizations commented that both the statute and the regulations placed a burden on this type of fundraising. They contend that Iowa Code Chapter 99B has been amended in a "patchwork" fashion and needs to be redrafted to provide clarity and to encourage the growth of charitable fundraising. They noted that the 25 percent limit on expenses is unreasonably low, especially when the event fails to raise a significant sum of money. The dollar limit on prizes and the imposition of sales tax were also cited as an impediment to effective fundraising. These issues do not related to the department’s rules and can only be addressed through amendments to Iowa Code chapter 99.

Action. No action, the department has agreed to come forward with a proposal relating to raffle tickets.

IOWA FINANCE AUTHORITY, 2001 Tax credit program, ARC 0764, 06/27/01 IAB, NOTICE.

Background. These proposals were initially reviewed at the committee’s July, September, and October meetings. The federal Low-Income Housing Tax Credit (Tax Credit) Program was created in 1986 to provide an incentive to developers to construct or to acquire or to substantially rehabilitate residential rental property. The rules are revised annually.

Commentary. This proposal is slated for adoption on Wednesday, October 10. Board representatives presented a number of suggested revisions to the Committee. These changes include modifying the hard-to-house set-aside to allow 40 percent of the units to serve those at the 60 percent income level (the initial proposal required all units to be dedicated to persons at the 40 percent income level). The assisted living set-aside was also changed for urban counties. Sixty percent of the units could serve persons at the 60 percent income level (the initial proposal required all units to be dedicated to persons at the 40 percent income level).

Discussion. Discussion centered around the 10 percent set aside for "hard-to-house" populations. Iowa Finance Authority (IFA) representatives maintained they have a federal obligation to fund housing for persons at the lowest income level for the longest period. IFA representatives noted the great need for housing is at the 40 percent level; persons living on federal Supplemental Security Income (SSI) or SSI supplemented by sheltered workshop employment often had incomes as low as the 25 percent level. They stated that by using a combination of vouchers and other benefits, it is feasible to provide projects at this income level, noting that the set-aside now requires the project to serve only a majority of the tenants at the 40 percent or below income level. Opponents of the 40 percent level note that a housing shortage also exists at the 60 percent level and contend that projects are not economically viable at the 40 percent level. Opponents suggested that other programs already address the needs of people at the 40 percent level.

Action. No action, additional review at the November ARRC meeting.

PUBLIC HEALTH DEPARTMENT, Medical Examiner, ARC 0983B & 0985B, 10/03/01 IAB, NOTICE.

Background. The State Medical Examiner promulgates rules regarding autopsies and the qualifications for medical examiners.

Commentary. Every county is required to have a medical examiner; in those counties without an examiner the State Medical Examiner serves that role. The rules call for a board-certified forensic pathologist to perform autopsies, but the rules allow any physician to perform that work, with documentation of the specific training, education, or experience qualifying the physician for that work. The cost of medical examiner services is borne by the decedent’s county of residence; it was specifically noted the decedent’s estate or family is never subject to this cost. These costs can include the initial investigation, the autopsy, and the final report - an expense that can run up to several thousand dollars. The rules detail four situations where autopsies must be performed and identify an additional 17 circumstances where autopsies should be performed. Members noted this meant that counties may incur autopsy expenses for incidents completely beyond their control.

Action. No action taken.

Next Meeting. The administrative rules review committee will meet Tuesday, November 13, and Wednesday, November 14, in Statehouse Room 116.The following special reviews will take place:

• ECONOMIC DEVELOPMENT: The Committee will discuss technical assistance provides by COGS for Community Development Programs.
• PUBLIC HEALTH DEPARTMENT: The Committee will discuss the newly adopted version of the plumbing code.

ALCOHOLIC BEVERAGES DIVISION, DRAM SHOP REQUIREMENTS, ARC 0854B, 08/08/01 IAB, NOTICE.

Background. Iowa’s Dram Shop law, Iowa Code § 123.92, provides that a division licensee or permittee who sold intoxicating liquors to an intoxicated person is liable for all damages caused by that person, when the licensee or permittee should have known the person was intoxicated. All licensees or permittees are required to maintain liability insurance in an amount set by the division.

Commentary. Recently it has been determined the current amounts set by the division are inadequate to cover likely damage. The current level is $35,000 -- $10,000 for bodily injury, with a $20,000 maximum for multiple injuries, and $5,000 for property damage. Those levels have been unchanged for over 40 years. The proposal would raise these amounts to $50,000, $100,000 and $20,000 respectively. A new category would be added -- $50,000 for loss of support, for a total of $220,000. It should be noted these are minimum levels and many larger facilities maintain greater coverage. Department representatives stated the new levels are well within the range of limits for those states requiring dram shop insurance, although it was noted many states have no such requirement at all. Industry representatives did not necessarily oppose this increase, but complained that other purveyors of alcoholic beverages, such as grocery stores and gas stations, are not required to maintain similar coverage. The representatives also noted that alternatives to traditional dram shop coverage should be allowed, such as bonding or risk pooling. Department representatives expressed willingness to support an alternative to traditional insurance, but stated that a statutory change would be required. Committee members were generally supportive of some dram shop reform, but felt more information is needed on the cost impact of these revisions. For that reason the Committee requested a regulatory analysis to estimate the financial impact this increase would have on licensees.

Action. A regulatory analysis of the noticed rule was requested of the committee, this action will delay final adoption of the rule until the analysis is completed. Additional committee review at that time.

BOARD OF EDUCATION EXAMINERS, LICENSURE ELIGIBILITY, 0874B, 08/08/01 IAB, NOTICE.

Background. The board proposes rules detailing the offenses and mitigating circumstances that will be considered when reviewing applicants for licensure.

Commentary. Iowa law states that applicants are disqualified for licensure if the applicant has been convicted of child abuse or sexual abuse of a child or convicted of a felony. In implementing these two conflicting provisions, the proposed rules do not make disqualification automatic; instead the proposal sets out a series of mitigating circumstances that will be considered in determining whether an applicant is to be licensed. The Code is unclear whether disqualification is mandatory or discretionary. An assistant attorney general noted that courts had found both equal protection and due process problems in making disqualifications automatic. It was generally agreed that the statute needs to be clarified and that the board would offer corrective legislation in 2002.

Action. No action taken.

HUMAN SERVICES DEPARTMENT, HAWK-I PROGRAM, ARC 0873B, 08/08/01 IAB, NOTICE.

Background. Iowa law has expanded the Medicaid Program to create a separate child health insurance program. Healthy and Well Kids in Iowa (HAWK-I) provides health care coverage to children under the age of 19 who are not Medicaid-eligible and who live in families with income below 185 percent of the federal poverty level. The HAWK-I Program began January 1, 1999.

Commentary. These proposed amendments would strike the word "transitional" from the rules, thus implying a more permanent level of coverage. Committee members questioned whether the legislative intent supports making HAWK-I a permanent insurance program; members cited Iowa Code § 514.1, which states that the Hawk-I Program is to "facilitate the transition of families to private sector health insurance coverage." Department representatives also noted that the program is open to uninsured children even if private insurance might be available, as long as the income guidelines are met.

Action. No action taken, additional review when this provision is adopted in final form.

IOWA FINANCE AUTHORITY, 2001 TAX CREDIT PROGRAM, ARC 0764, 06/27/01 IAB, NOTICE.

Background. These rules were initially reviewed at the committee’s July and September meetings. The federal Low-Income Housing Tax Credit (Tax Credit) Program was created in 1986. The purpose of the tax credit program is to provide an incentive to developers to construct or to acquire or to substantially rehabilitate residential rental property. The rules are revised annually.

Commentary. Discussion centered around two "set-asides" contained in this program. The first set-aside of 10 percent of the credits is for nonprofit developers. In response to suggestions that the rules favor nonprofit over for-profit developers, agency representatives noted that in 2000 nonprofit developers received credits for only seven projects. They also stated that 99.5 percent of the tax credits went to private investment, and contended this high level of private investment met the goal of the program by using private funds for low-income housing.
The second 10 percent set-aside is for hard-to-house populations, defined as persons at the 40-50 percent of median income level. Opponents of this set-aside stated that IRS regulations only require a 60 percent income level and that projects are not economically viable at a 40-50 percent level--rents are so low a project will not cash flow. Agency representatives responded that the purpose of the program is to house the poor and that it is appropriate to favor projects for the very poor; they also contended that federal regulations call for a preference for very low income.
A third issue was the declining number of applications. Opponents contend that the increasing program requirements will discourage developers from making application, noting that applications have dropped from 72 to 41 in four years. Agency representatives responded that a recent requirement for an economic feasibility study for every application had eliminated unneeded projects that at one time were commonplace.

Action. No action, scheduled for additional review in October.

PUBLIC HEALTH DEPARTMENT, STATE PLUMBING CODE, ARC 0850B, 08/08/01 IAB, NOTICE.

Background. The Iowa Department of Public Health is charged with maintaining a plumbing code setting the minimum standard for Iowa’s cities. For years the department has adopted by reference the model "Uniform Plumbing Code(UPC)", updating it periodically as the model was revised. The Building Code Commission, part of the Fire Marshals Office, also maintains a set of building codes including the 1994 UPC.

Commentary. This proposal began as a routine effort to update the 1994 edition of the Uniform Plumbing Code to the 2000 model. Controversy arose when representatives of a second code, the "International Plumbing Code (IPC)", suggested that the IPC be adopted as the state minimum code and be designated as an alternative to the UPC. They cited the advantages as including an entire family of interrelated building codes and the fact that a number of Iowa cities have already adopted the IPC. Department representatives defended the continued use of the UPC, stating that it is easier to use because it does not require reference to other manuals and sets out specific requirements instead of more general performance standards.

Action. No action, further review scheduled for November.

Next Meeting. The Administrative Rules Review Committee will meet Tuesday, October 9, 2001, in Statehouse Room 116. The following special reviews are planned:

• The Committee will discuss a new policy by the Department of General Services relating to the purchasing of Prison Industries furniture by state agencies.
• The Committee will review Department of Inspection and Appeals rules regulating gaming activities by charitable organizations.

ECONOMIC DEVELOPMENT DEPARTMENT. Technical assistance: CDBG program, SELECTIVE REVIEW.

Background. Federal Community Development Block Grant (CDBG) funds are available to Iowa communities for a variety of projects. Smaller communities often hire consultants to apply for and administer the grants.

Commentary. The Committee heard testimony from two nonprofit groups that provide application and management services for smaller communities. They contended that the 13 local councils of governments (COGs) have an unfair advantage in obtaining administration contracts for these CDBG funds. Under DED policy, COGs do not have to go through a selection process to be awarded a project administration contract, while the private groups must go through a procurement process. The private groups also complained that COGs served as the clearinghouse for CDBG applications before they were forwarded to the DED, thus giving COGs an additional advantage in obtaining administration contracts, because they have advance knowledge of the grant. DED officials responded that COGs are consortiums of local governments and thus are treated as extensions of the local governments themselves. Those officials did express a willingness to work with the private groups to make the process fair for all participants. Committee members suggested that the private groups file a petition for rulemaking with the DED, calling for a uniform bidding process.

Action. No action, but additional review is possible.

HUMAN SERVICES DEPARTMENT. Care facility reimbursement, ARC 0780B, 7/11/01, EMERGENCY FILING.

Background. Initially noticed in March and renoticed in May, this filing has been redrafted in response to concerns that mandated cost cutting would result in a decline in the quality of care.

Commentary. The final issue in this rulemaking is the implementation of the "85 percent occupancy level" provision, which would reimburse care facilities on the assumption of an 85 percent occupancy level. Proposed legislation would have delayed this requirement until 2003; however, that provision was vetoed by the Governor. While the rule called for a 2002 implementation, department representatives assured the Committee that a 2003 date is in fact the policy. They further stated this correction would be promptly made.

Action. No action taken.

HUMAN SERVICES DEPARTMENT. Family Investment Program (FIP): 5-year cutoff, ARC 0768B, 7/11/01, ADOPTED.

Summary. The Family Investment Program has a 60-month lifetime maximum. The department implements rules for hardship exceptions.

Commentary. At the end of calendar 2001 some Iowa families will reach the 60-month limit. Under the DHS filing, a hardship exemption is available when circumstances prevent the family from being self-supporting. The hardship must be a result of a past or current experience that is affecting the family’s current functioning; it can include such things as domestic abuse, a medical condition, chronic unemployability, etc. Department representatives noted there is a core of some 250 FIP clients who are unlikely to become independent. The hardship exemption can be renewed every six months.

Action. No action taken.

INSURANCE DIVISION. MEWA regulation, ARC 0726B, 7/11/01 IAB NOTICE.

Background. Multiple employer welfare arrangements (MEWAs) are a very restricted form of self-insurance limited to a trade, industry, or professional association of employers.

Commentary. These amendments resolve an earlier controversy by eliminating a requirement that each member of the MEWA be jointly and severally liable for the default of any of its members. The compromise is that the MEWA itself must provide protection from a default, such as bonding, insurance, or letters of credit. A second issue, left unresolved, is the requirement that all MEWAs have $500,000 in reserves. Insurance Division representatives stated this requirement is critical to ensure that members are protected against the failure of a MEWA. The division did offer to allow a phase-in period for those MEWAs that do not have adequate reserves. These changes appear to eliminate the remaining controversies with this program.

Action. No action taken.

IOWA FINANCE AUTHORITY (IFA). Hard-to-house population, ARC 0764-0765B, 06/27/01 IAB, SELECTIVE REVIEW.

Background. The "hard-to-house" phrase appears in both the Housing Assistance Fund (HAF) rules and the 2001 Tax Credit Program. This new category includes persons with recent substance abuse problems, persons with criminal backgrounds that include violent crimes and drugs, persons with extremely poor rental payment histories, persons with extremely poor life skills and hygiene practices, children and minors with behavior and conduct disorders, and individuals charged with or convicted of sex offenses.

Commentary. Committee members questioned whether the statute contemplated that these particular low-income groups should be specifically targeted in housing programs. Public commenters detailed the problems that could arise serving this group in an apartment complex setting. Comments also stated that this definition was originally set out in item six of a housing task force report to the Governor; they specifically comment on the low priority given this group in the report. IFA representatives stated that in the current round of HAF grants none of the recipients served the hard-to-house group; they further stated the controversial definition would be removed from the rules.

Action. No action taken.

MEDICAL BOARD/PHARMACY BOARD. Automated dispensing systems, ARC 0833A & 0801A, 7/25/01 & 7/11/01 IAB, NOTICE.

Background. The provisions of 2001 Iowa Acts, House File 726, § 10(i), created a one-year pilot project allowing the use of automated medication distribution systems (AMDS). These systems perform some of the functions performed by a pharmacist. The key issue is that the final product, the prescription, is not checked by the prescriber.

Commentary. The goal of this pilot is to encourage the various boards to jointly develop a statutory solution allowing broader use of these systems. Achieving that goal appears remote, since the Medical and Pharmacy boards propose widely divergent rules to implement House File 726. The Medical Board, noting that only one system exists for physicians, has proposed only general guidelines, implemented case-by-case by the prescribing physicians. The Pharmacy Board, with three different systems available, has a far more detailed set of rules placing far more obligations on the pharmacist. Committee members commented on these differences but did accept the notion that different types of regulation may be appropriate for different prescribers. Members were concerned about the lack of regulation for the system itself, noting that no entity is responsible for regulating the equipment.

Action. No action taken, further review when adopted in final form.

PUBLIC EMPLOYMENT RELATIONS BOARD (PERB). Arbitrator fees, ARC 0726B, 6/13/01 IAB, NOTICE.

Summary. The PERB sets the reimbursement fee for fact finders, arbitrators, and adjudicators used in government collective bargaining matters.

Commentary. Last raised in 1997, the board proposes to raise the fees for these contract professionals from $475 per day to $650 per day, plus expenses. This fee is a cap; local jurisdictions may negotiate lower fees. Board representatives noted that even at $650, Iowa’s fees are still lower than surrounding states. Committee members were surprised that only a fraction of the arbitrators and negotiators are Iowans. Board representatives noted that most Iowans are currently employed as advocates on one side or the other; they further stated that the board does encourage Iowans to qualify for the list. The representatives explained that the PERB sends a list of five names to the parties, who simply strike off names until only one is left.

Action. No action taken.

RACING AND GAMING COMMISSION. Public Information at Prairie Meadows, SELECTIVE REVIEW.

Background. A recent newspaper editorial complained that Prairie Meadows, a horse track and casino in Central Iowa, demanded $25 per hour to provide a breakdown of purse money won by horse owners. The Committee discussed whether the Racing and Gaming Commission should, by rule, collect and maintain this information.

Commentary. Prairie Meadows is managed and operated by a private, not-for-profit corporation, the Racing Association of Central Iowa, Incorporated (RACI), subject to regulation by the Iowa Racing and Gaming Commission. Under Iowa law a private corporation is not subject to Iowa’s Open Records Law, and thus RACI cannot be compelled to release a comprehensive list of purse winners nor can it be compelled to compile information without charge. However, that information could be demanded by the Racing and Gaming Commission under its regulatory powers. Representatives of RACI stated that the track voluntarily maintains an open records policy, and that information is available at no more than the cost of a copy. The representatives did note that extracting information that is not readily available does take extensive staff time and a per hour charge could be levied. Committee members voiced support for a written open records policy, but did suggest that any aggrieved individual could pursue this matter further by filing a petition for rulemaking with the Racing and Gaming Commission.

Action. No further action taken.

Next Meeting. The Administrative Rules Review Committee will tentatively meet Tuesday, September 11, and Wednesday, September 12, 2001, in Statehouse Room 116. Additional information is available by calling (515) 281-3084.

CHIROPRACTIC EXAMINERS, Physiotherapy procedures, ARC 0740B, 06/13/01 IAB, NOTICE.

Background. Since 1984, Iowa Code §151.1 has authorized the use of "chiropractic physiotherapy procedures." In a proposed amendment to its advertising rules, the board would restrict the use of the term "physical therapy," but allow the use of the term "physiotherapy." The proposal also notes that "representations regarding physiotherapy … may be the same as, or similar to, physical therapy or physical medicine." Earlier efforts by the board to define the term "chiropractic physiotherapy" have been unsuccessful.

Commentary. Representatives of the physical therapy profession oppose this proposal; first because it does not completely ban the use of the phrase "physical therapy" and second because they contend that the word "physiotherapy" is synonymous with the term "physical therapy" and therefore is part of the practice of physical therapy, not chiropractic. They also contend that it is inappropriate to engage in rulemaking on this issue while legislation is pending before the General Assembly.

Action. No action taken, additional review when this provision is adopted in final form.

HOUSING FINANCE AUTHORITY, Housing assistance fund, ARC 0765B, 06/27/01 IAB, FILED EMERGENCY AFTER NOTICE.

Background. The rules for the Housing Assistance Fund Program are now being amended for the first time in a decade; the program has not been active for several years. The Housing Assistance Fund (HAF) provides financial assistance to a variety of local housing projects, providing "decent, safe, affordable housing to lower–income Iowans."

Commentary. The HAF program has four categories: home ownership, affordable rental housing, technical assistance and related programs, and transitional housing and supportive services. The programs themselves are not controversial, but one definition in particular is "hard-to-house" populations. This new category includes persons with recent substance abuse problems; persons with criminal backgrounds that include violent crimes and drugs; persons with extremely poor rental payment histories; persons with extremely poor life skills and hygiene practices; children and minors with behavior and conduct disorders; and individuals charged with or convicted of sex offenses. Committee members questioned whether the statute contemplated that these particular groups should be specifically included in housing programs. Members also questioned whether the services available to these groups properly fell within the bounds of housing assistance, the issue being that housing assistance should be designed to move clients into safe and affordable housing, not to provide services that are only incidental to that goal. The HFA representatives responded that hard-to-house populations are frequently housed only in temporary shelters and that housing problems often impact whole families, not just specific individuals. Committee members did concede that the applicants for the current round of funding were all well within the goals of the HAF program and for that reason agreed to further discuss this definition at the August meeting.

Action. Deferred without action until August.

INSPECTIONS AND APPEALS, Food inspections at farmers markets, SELECTIVE REVIEW.

Background. Iowa Code chapter 137F requires the adoption of the federal food code as the basis for food establishment inspection. Recent amendments to the food code now make it impossible for some food vendors at farmers markets to obtain a single, season-long permit; instead they are required to obtain a biweekly $25 permit.

Commentary. The food code provides for a temporary food establishment, operated in conjunction with a single event, for a period of no more than 14 days (§137F.1(16)). That designation is really designed for fairs and festivals, but under the new code it is the only viable licensing option now available to several small food vendors at Iowa’s farmers markets. The problem is this $25 license must be separately obtained for each farmers market, every two weeks. Since these markets operate through the fall and the vendors attend several markets each week, the biweekly licensing costs amount to hundreds of dollars biweekly. Both state and local officials agree this is an unintended and unnecessary expense.

As a temporary resolution, the Department of Inspections and Appeals has implemented an emergency rule, applicable only for the remainder of this calendar year, stating: "A temporary food establishment license located in a farmers market is valid at that site until December 31, 2001, provided the food establishment does not operate more than 14 consecutive days at this location. This rule will cease as of January 1, 2002."

Action. General referral to the legislature.

PUBLIC HEALTH DEPARTMENT, Transportation of radioactive waste, ARC 05119B, 04/07/01 IAB, ADOPTED RULE.

Background. This filing was delayed at the Committee’s May meeting; it establishes a new fee for the transportation of radioactive waste across Iowa.

Commentary. This waste crosses Iowa by both rail and truck while being shipped to permanent storage facilities. The waste includes the traditional high-level waste as well as the far more common, low-level waste from hospitals or other similar sources; separate fees are specified for each level. The rule imposes a series of fees that shippers must pay when transporting nuclear waste across Iowa. The fee varies with the type of waste, with the highest fee imposed on the movement of high-level waste. Opponents are very concerned at the size of the fees, which vary from $1,750 per cask for high level waste transported by highway, to $250 per shipper for shipment of low-level waste. They also note that no other state imposes a fee for the movement of low-level waste. The department maintains the fees are needed to generate funds to train personnel -- local law enforcement, fire departments, and emergency medical personnel -- to safely respond to emergencies relating to this waste. Department representatives estimate the cost of this program to be roughly $650,000 annually.

Discussion. Committee members were unsure why thousands of first responders along the interstate corridors require this training; members suggested that perhaps the National Guard or other special purpose teams could be trained. Department representatives stated that actual cleanup teams would be hours in arriving and that training is needed for the first responders, both for their own safety and to initially contain the damage. Department representatives noted these responders do receive some training in responding to incidents involving hazardous material in general; but there is a serious lack of specific training for incidents involving radioactive material. Committee members also were concerned this issue was not being dealt with on a national basis by the federal government. Members were concerned that individual states would create a patchwork of regulations with little uniformity.

Action. The Committee imposed a session delay on the collection of this fee in order to allow representatives of the department and the shipping industry an opportunity to resolve differences over the fee structure. Members also voted to contact the Iowa congressional delegation concerning the federal role in transportation safety. Additional review of this issue is contemplated in December.

REVENUE DEPARTMENT, Taxation of livestock: elk, SELECTIVE REVIEW.

Background. Department of Revenue and Finance rule 701 IAC 17.9(1) states that nondomesticated animals are excluded from the definition of livestock even if raised in captivity as a source of food or clothing. A number of Iowa farmers are now raising elk, which are members of the deer family. They contend that elk should be treated as livestock for taxation purposes.

Commentary. Opponents of the Revenue Department rule argue against the restrictive definition of the term "livestock." They note that Iowa agriculture is evolving and contend that the department definition should recognize this evolution and include farm-raised elk as livestock. The also contend that the term "livestock" should be broadly construed since ostriches, buffalo, and catfish already have tax exemptions. In response to these concerns, Committee members voted to request an Attorney General’s Opinion asking whether the Department of Revenue and Finance has an obligation to recognize new developments in farming activities when drafting or amending rules relating to the taxation of those activities.

Action. Additional review when the Attorney General’s Opinion is issued.

TREASURER, Unclaimed property, ARC 0747B, 06/27/01 IAB, ADOPTED RULE.

Background. The provisions of 2000 Iowa Acts, House File 2557, require the Treasurer of State to adopt rules for entering into contracts with an independent auditor for the examination of unclaimed property on behalf of the Treasurer.

Commentary. At issue with these adopted rules is the use of contingency fees. Opponents of this system feel that auditors working on contingency fees, especially those based on the amount assessed as opposed to the amount ultimately collected, encourage auditors to be overly inclusive in identifying unclaimed property. Opponents suggested either a per hour reimbursement or the implementation of a "holder’s bill of rights" to specify in detail the auditing process. Representatives of the Treasurer’s Office responded that all in-state audits are performed on a per hour basis, and that any complaint concerning out-of-state auditors would be reviewed by the Treasurer’s Office. Committee members suggested that the Treasurer again review these concerns.

Action. No action taken.

CORRECTIONS DEPARTMENT, Prison Industries: sale of signs and signposts, SELECTIVE REVIEW.

Background. Although it is not a rulemaking issue, the sale of goods and services by Prison Industries has frequently been reviewed by ARRC. In this instance, the Committee reviewed allegations that Prison Industries sold signposts in direct competition with Iowa businesses.

Commentary. The manufacture and sale of traffic signs has long been a Prison Industries business. The issue arose when Prison Industries began purchasing signposts from a vendor and selling them in Iowa. This precipitated a complaint from an Iowa sign company that Prison Industries was acting merely as a distributor of a manufactured product, not engaging in meaningful inmate labor. The Citizens Aide/Ombudsman investigated this situation at the request of the Committee. It was noted that Iowa law allows Prison Industries to act as a distributor "only when directly related to the product line." It was generally conceded this would allow the sale of a post when provided in conjunction with the sale of a sign. Representatives from Prison Industries stated that the department provided posts only for those signs that Prison Industries sold. In addition, those representatives stated that as soon as is feasible, Prison Industries would begin manufacturing posts as part of its product line.

Action. The commitments made by Prison Industries were acceptable to all concerned. No action taken.

ENVIRONMENTAL PROTECTION COMMISSION (EPC), Disposal of white goods, ARC 0668B, 5/16/01 IAB, NOTICE.

Background. Since 1990, EPC has regulated the disposal of "white goods": refrigerators or other household appliances containing the carcinogen PCB which is frequently found in capacitors. Under those rules, any facility that removes PCB capacitors from white goods must register and file a written description of the removal and storage site. All capacitors must be removed and disposed of according to federal regulation.

Commentary. The Commission proposes a complete revision of this program, dropping the term "white goods" in favor of the more descriptive term "appliances". The proposal establishes a permit program for the "demanufacture" (scrapping) of discarded appliances; anyone wishing to enter this business must obtain the permit prior to starting operation. The proposed rules require that all electrical parts containing PCBs or containing mercury and refrigerants be removed prior to those parts being recycled or scrapped. Oils, gases, refrigerants, and other hazardous materials removed from discarded appliances must be stored and recycled or disposed of according to specific federal regulations.

Committee members voiced concern over this proposal. First it was noted the term "appliance" is vague, since most appliances do not contain any of the substances regulated in the program. Members were also unsure whether compliance with these requirements is even feasible; especially in the area of refrigerants, often freon has escaped from an appliance long before it has been received by a facility. Public landfills also expressed concern; noting that under federal law the ultimate recipient was responsible for the proper disposal of junked appliances, landfill operators felt the proposed rules do not adequately reflect the requirements of federal law. They also were concerned these requirements could imperil curbside pickups and actually result in an increase in unlawful dumping as a cheap alternative to recycling.

Action. Expressing concern over the cost and impact of this proposal, Committee members requested a regulatory analysis on the costs and benefits associated with this proposal. Further review is anticipated when the analysis is complete, probably late summer/early fall.

ENVIRONMENTAL PROTECTION COMMISSION, Air emissions, 567 IAC 22.1(2), SELECTIVE REVIEW.

Background. Iowa manufacturers dispute the authority of EPC to require operating permits for certain equipment which does not vent to the outside. The officials respond that the commission does not regulate indoor emissions, but particulate matter in emissions escaping from buildings does fall under EPC jurisdiction, and thus it is the emission itself that brings the regulation of its source.

Commentary. First reviewed in March, the ARRC imposed a 70-day delay on permitting provisions relating to air quality, in order to allow legislation to be proposed prohibiting the permitting of indoor sources of emissions; that legislation was subsequently vetoed. The EPC and industry representatives agreed to work together to draft rules to resolve the issue, suggesting that a draft policy could be ready by August.

Action. No action taken.

INSPECTIONS AND APPEALS, Birthing centers, ARC 0696B, 5/30/01 IAB, ADOPTED.

Background. Regulated under Iowa Code Chapter 135G, Iowa’s only birth center is the sole medical facility where a nurse-midwife, instead of a physician, delivers a baby. The only other alternative for a nurse-midwife delivery is the mother’s own residence.

Commentary. Birthing centers are a perennial issue with the ARRC. Following an initial review last summer, it was determined that the existing rules, unamended for over a decade, are outdated and in some cases in conflict with the Iowa Code. This spawned a rulemaking to update the rules and two legislative proposals. One proposal would limit state regulation to that set out in a national model, the second would simply deregulate birth centers—both failed. This left the current rulemaking, which simply brings the existing rules into line with the Iowa Code. Nurse midwives applauded the change providing that centers no longer need a physician medical director; however, representatives from the Iowa Medical Society expressed great concern over this change. Rule changes aside, nurse-midwives contend the whole regulatory scheme remains so burdensome that the birth center option is not viable, pointing to the fact that only one exists in the state. They especially cite the requirement that a patient be seen twice by a physician and contend that physicians are hesitant to work with birth centers. Department representatives and midwives agreed to work together in an attempt to develop a new regulatory scheme.

Action. No action taken.

HUMAN SERVICES DEPARTMENT, Care facility reimbursement, ARC 0671B, 5/16/01, NOTICE.

Background. Initially noticed in March, this proposal has been redrafted in response to concerns that mandated cost-cutting would result in a decline in the quality of care. This new proposal is an attempt to address those concerns.

Commentary. Under the case mix methodology, payment is determined using a uniform statewide standard price. based on a recognition of the provider’s allowable costs for two components, a direct care and non-direct care component, plus a potential profit add-on payment. In response to legislation, the department anticipates some minor revisions to this filing, followed by an emergency implementation in June. The revisions appear to be generally acceptable to all interested persons.

Action. No action.

HUMAN SERVICES DEPARTMENT, Family Investment Program (FIP): 5 year cut-off, ARC 0610B, 4/18/01, NOTICE.

Summary. The Family Investment Program has a 60-month lifetime maximum. The department proposes rules for hardship exceptions.

Commentary. At the end of calendar 2001, some Iowa families will reach the 60 month limit. Under the DHS proposal, a hardship exemption is available when circumstances prevent the family from being self-supporting. The hardship must be a result of a past or current experience that is affecting the family’s current functioning; it can include such things as domestic abuse, a medical condition, chronic unemployability, etc. Committee members were concerned these criteria could be used to avoid taking a job, noting that other benefits, such as food stamps and Medicaid, would remain available even on limited employment. Members were also concerned about the lack of interstate recordkeeping, making it possible for a person to gain FIP benefits even after exhausting eligibility in another state. Department representatives acknowledged the members’ concerns but did note there is a core group of FIP clients who are unlikely to become independent.

Action. No action taken, but additional review is likely after adoption.

INFORMATION TECHNOLOGY DEPARTMENT, Government website advertising, ARC 0699B, 5/30/01, NOTICE.

Background. As a funding source the department proposes to allow some advertising on state Internet websites.

Commentary. Revenue received from these advertising activities will not go to the General Fund, instead it will be used to defray the costs of agencies’ technology needs. No agency is compelled to accept advertising and will participate in the decision-making process for acceptance of advertising. Internal standards will be developed to ensure that all advertising is appropriate for a government website. Committee members express concern that advertising could "junk up" government websites.

Action. No action taken.

PUBLIC SAFETY DEPARTMENT, Fire safety: bed and breakfast facilities, ARC 0566B, 3/21/01, NOTICE.

Background. Bed and breakfast homes and inns are basically tiny hotels. Homes may have no more than four guest families, inns no more than nine guest rooms. In keeping with their unique status, Iowa law calls on the State Fire Marshal to develop limited fire safety rules for these facilities.

Commentary. At issue is the specific degree of fire regulation at bed and breakfast inns—the larger of the facilities. The Committee heard allegations that the proposed fire safety rules are at odds with the requirements of some local fire safety codes. Other concerns centered around the cost of installing interconnected fire alarms in every guest room. In response to these concerns the department requested that ARRC impose a session delay to provide an opportunity for fire officials to meet and develop revisions to these rules.

Action. Session delay.