Bulletin 12-21-2016

Front matter not included
ARC 2867CEconomic Development Authority[261]Notice of Intended Action

Twenty-five interested persons, a governmental subdivision, an agency or association of 25 or more persons may demand an oral presentation hereon as provided in Iowa Code section 17A.4(1)“b.”

Notice is also given to the public that the Administrative Rules Review Committee may, on its own motion or on written request by any individual or group, review this proposed action under section 17A.8(6) at a regular or special meeting where the public or interested persons may be heard.

    Pursuant to the authority of Iowa Code sections 15.106A and 15.321, the Iowa Economic Development Authority (IEDA) hereby gives Notice of Intended Action to adopt new Chapter 81, “Renewable Chemical Production Tax Credit Program,” Iowa Administrative Code.     The proposed amendment creates a new chapter of rules governing the administration of the Renewable Chemical Production Tax Credit Program. The program was created by 2016 Iowa Acts, Senate File 2300. The proposed new chapter provides for the administration of the program by IEDA and governs eligibility requirements, the application process and application review, the agreement, calculation of the tax credit, administration of the tax credit wait list, the process for claiming the credit, and the process used to add additional building block chemicals by administrative rule.     The Economic Development Authority Board approved these rules at a Board meeting on November 18, 2016.     Interested persons may submit comments on or before January 10, 2017. Comments may be submitted to Jennifer Klein, Economic Development Authority, 200 East Grand Avenue, Des Moines, Iowa 50309; telephone number (515)725-3124; e-mail Jennifer.Klein@iowa.gov.     This rule making does not have any fiscal impact to the state of Iowa. In order to reduce the overall fiscal impact of this program to zero, 2016 Iowa Acts, Senate File 2300, division I, reduced the award cap for the High Quality Jobs Program by $25 million each year for the next five fiscal years.     After analysis and review of this rule making, no impact on jobs has been found.     These rules are intended to implement Iowa Code sections 15.315 to 15.322.    The following amendment is proposed.

    ITEM 1.    Adopt the following new 261—Chapter 81: CHAPTER 81RENEWABLE CHEMICAL PRODUCTION TAX CREDIT PROGRAM

261—81.1(15) Purpose.  The purpose of this Act is to encourage development of the renewable chemicals industry and stimulate job growth using the renewable chemical production tax credit program to incentivize new and existing businesses to produce high-value renewable chemicals in Iowa from biomass feedstock.

261—81.2(15) Definitions.  As used in this chapter, the following definitions shall apply:        "Authority" means the economic development authority created in Iowa Code section 15.105.         "Authority’s Web site" means the information and related content found at www.iowaeconomicdevelopment.com/ and may include integrated content at affiliate sites.         "Biobased content percentage" means, with respect to any renewable chemical, the amount, expressed as a percentage, of renewable organic material present as determined by testing representative samples using the American Society for Testing and Materials standard D6866.        "Biomass feedstock" means sugar, polysaccharide, crude glycerin, lignin, fat, grease, or oil derived from a plant or animal, or a protein capable of being converted to a building block chemical by means of a biological or chemical conversion process.        "Board" means the members of the economic development authority board appointed by the governor and in whom the powers of the authority are vested pursuant to Iowa Code section 15.105.         "Building block chemical" means a molecule converted from biomass feedstock as a first product or a secondarily derived product that can be further refined into a higher-value chemical, material, or consumer product. “Building block chemical” includes but is not limited to high-purity glycerol, oleic acid, lauric acid, methanoic or formic acid, arabonic acid, erythonic acid, glyceric acid, glycolic acid, lactic acid, 3-hydroxypropionate, propionic acid, malonic acid, serine, succinic acid, fumaric acid, malic acid, aspartic acid, 3-hydroxybutyrolactone, acetoin, threonine, itaconic acid, furfural, levulinic acid, glutamic acid, xylonic acid, xylaric acid, xylitol, arabitol, citric acid, aconitic acid, 5-hydroxymethylfurfural, lysine, gluconic acid, glucaric acid, sorbitol, gallic acid, ferulic acid, nonfuel butanol, nonfuel ethanol, or such additional molecules as may be included by the authority following the procedure in rule 261—81.8(15).         "Crude glycerin" means glycerin with a purity level below 95 percent.        "Director" means the director of the economic development authority or the director’s designee.         "Eligible business" means a business meeting the requirements of rule 261—81.3(15).        "Food additive" means a building block chemical that is not primarily consumed as food but which, when combined with other components, improves the taste, appearance, odor, texture, or nutritional content of food. The authority, in its discretion, shall determine whether or not a building block chemical is primarily consumed as food.        "High-purity glycerol" means glycerol with a purity level of 95 percent or higher.        "Pre-eligibility production threshold" means, with respect to each eligible business, the number of pounds of renewable chemicals produced, if any, by an eligible business during the calendar year prior to the calendar year in which the business first qualified as an eligible business pursuant to rule 261—81.3(15).         "Production year" means any calendar year after the year in which the eligible business’s pre-eligibility production threshold was established and in which the eligible business produces renewable chemicals.        "Program" means the renewable chemical production tax credit program administered pursuant to this chapter.        "Renewable chemical" means a building block chemical with a biobased content percentage of at least 50 percent. “Renewable chemical” does not include a chemical sold or used for the production of food, feed, or fuel. “Renewable chemical” includes cellulosic ethanol, starch ethanol, or other ethanol derived from biomass feedstock, fatty acid methyl esters, or butanol, but only to the extent that such molecules are produced and sold for uses other than food, feed, or fuel. “Renewable chemical” also includes a building block chemical that can be a food additive as long as the building block chemical is not primarily consumed as food and is also sold for uses other than food. “Renewable chemical” also includes supplements, vitamins, nutraceuticals, and pharmaceuticals, but only to the extent that such molecules do not provide caloric value so as to be considered sustenance as food or feed.        "Sugar" means the organic compound glucose, fructose, xylose, arabinose, lactose, sucrose, starch, cellulose, or hemicellulose.

261—81.3(15) Eligibility requirements.  To be eligible to receive the renewable chemical production tax credit pursuant to the program, a business shall meet all of the following requirements:    81.3(1) Physical location.  The business must have a facility that produces renewable chemicals and is physically located in the state of Iowa. If a business has facilities located in more than one state, only those renewable chemicals produced at facilities physically located in the state of Iowa may be counted for the purpose of calculating the tax credit under subrule 81.6(1).     81.3(2) Operated for profit.  The business must be operated for profit and under single management. For purposes of this rule, “single management” means under common ownership or control. If the same entity owns or controls multiple facilities at which renewable chemicals are produced, the facilities under common ownership or control will be considered a single eligible business for purposes of receiving a tax credit under this chapter.     81.3(3) Type of business.  The business may not be an entity providing professional services, health care services, or medical treatments or an entity engaged primarily in retail operations.    81.3(4) Organization.  The business must have organized, expanded, or located in the state on or after April 6, 2016.     81.3(5) Not reducing operations.  The business shall not be relocating or reducing operations as described in Iowa Code section 15.329(1)“b” and as determined under the discretion of the authority.    81.3(6) Compliance.  The business must be in compliance with all agreements entered into under this program or other programs administered by the authority.

261—81.4(15) Application process and review.       81.4(1)   An eligible business that produces a renewable chemical in this state from biomass feedstock during a calendar year may apply to the authority for the renewable chemical production tax credit.    81.4(2)   The application shall be made to the authority in the manner prescribed by the authority. Information about the program and a link to the online application and instructions may be obtained by contacting the authority or by visiting the authority’s Web site: Iowa Economic Development Authority Community Development Division 200 East Grand Avenue Des Moines, Iowa 50309 (515)725-3000 www.iowaeconomicdevelopment.com/    81.4(3)   The application shall be made to the authority during the calendar year following the calendar year in which the renewable chemicals were produced. For example, an eligible business may submit an application in calendar year 2018 to receive a tax credit based on renewable chemicals produced in calendar year 2017.     81.4(4)   The application may be submitted to the authority electronically during the annual filing window. This filing window shall be from February 15 to March 15 of each calendar year. The authority may adjust the annual filing window dates under extenuating circumstances and will notify affected parties of such circumstances.     81.4(5)   The application shall include all of the following information:    a.    The name of the qualifying building block chemical produced by the eligible business for which the business is claiming a tax credit.    b.    The amount of renewable chemicals produced in the state from biomass feedstock by the eligible business during the calendar year, measured in pounds.    c.    The amount of renewable chemicals produced in the state from biomass feedstock by the eligible business during the calendar year prior to the year in which the business first qualified as an eligible business under the program.     d.    The city or county where the plant producing renewable chemicals is located.     e.    The type of feedstock used to produce the renewable chemicals.    f.    The date on which the eligible business organized, expanded or located in the state.     g.    Any other information reasonably required by the authority in order to establish and verify eligibility under the program.    81.4(6)   Applications will be reviewed by the authority on a first-come, first-served basis as described in subrule 81.6(5). Applications shall be date- and time-stamped by the authority in the order in which such applications are received. If the authority deems that additional information is needed before a determination of eligibility can be made, and the authority makes a written request for additional information from the applicant, the applicant must provide the requested information within 30 days of the date that the written request from the authority was made. If an applicant does not provide the requested information within 30 days, the applicant will be placed at the end of the queue of applications received. The authority shall review the queue of applications for eligibility and maintain a list of successful applicants as required by subrule 81.6(5).     81.4(7)   The authority shall notify an applicant when the applicant has been placed on the list of successful applicants.     a.    For applicants on the list for whom there are sufficient tax credits available in the aggregate cap for the fiscal year, the applicant must sign the agreement within 60 days of being notified of eligibility for the tax credit. Upon request by the applicant, the authority may extend the time period for signing the agreement by an additional 30 days.     b.    For applicants on the wait list established in subrule 81.6(5), the authority shall notify the applicant of the applicant’s status and position on the wait list.

261—81.5(15) Agreement.      81.5(1) Agreement.  Before being issued a tax credit pursuant to this chapter, an eligible business shall enter into an agreement with the authority for the successful completion of all requirements of the program. As part of the agreement, and as a condition of receiving the tax credit, the eligible business shall agree to collect and provide any information reasonably required by the authority in order to allow the board to fulfill the board’s reporting obligation under Iowa Code section 15.320.    81.5(2) Fees.  The compliance cost fees authorized in rule 261—187.6(15) shall apply to all agreements entered into under this program and shall be collected by the authority in the same manner and to the same extent as described in that rule.    81.5(3) Requirements.  An eligible business shall fulfill all the requirements of the program and the agreement before receiving a tax credit or entering into a subsequent agreement under this rule. The authority may decline to enter into a subsequent agreement under this rule or to issue a tax credit if an agreement is not successfully fulfilled.     81.5(4) Issuance of credit.  Upon establishing that all requirements of the program and the agreement have been fulfilled, the authority shall issue a tax credit and related tax credit certificate to the eligible business stating the amount of renewable chemical production tax credit the eligible business may claim. The amount of the tax credit shall not exceed the amount allowable under rule 261—81.6(15).

261—81.6(15) Renewable chemical production tax credit.      81.6(1) Calculation of tax credit amount.   An eligible business that has entered into an agreement pursuant to rule 261—81.5(15) may be issued a tax credit in an amount equal to the product of five cents multiplied by the number of pounds of renewable chemicals produced in this state from biomass feedstock by the eligible business during a given production year.    a.    The maximum amount of tax credit that may be issued under the program to an eligible business for the production of renewable chemicals in a calendar year shall not exceed the following:    (1)   In the case of an eligible business that has been in operation in the state for five years or less at the time of application, $1 million.    (2)   In the case of an eligible business that has been in operation in the state for more than five years at the time of application, $500,000.    b.    For purposes of this subrule, “operation” begins on the date the eligible business first began commercial production.    81.6(2) Eligible business only.  An eligible business shall not receive a tax credit for renewable chemicals produced before the date the business first qualified as an eligible business pursuant to rule 261—81.3(15).    81.6(3) Production above pre-eligibility production threshold.  An eligible business shall only receive a tax credit for renewable chemicals produced in a calendar year to the extent such production exceeds the eligible business’s pre-eligibility production threshold as defined in rule 261—81.2(15). For example, if an eligible business produces 3 million pounds of renewable chemicals during calendar year 2016 and first becomes an eligible business under this chapter in calendar year 2017, the pre-eligibility production threshold for the business is 3 million pounds. If the same eligible business produces 10 million pounds of renewable chemicals during calendar year 2017, the eligible business may only receive a tax credit for the amount produced over the pre-eligibility production threshold, which in this example equals 7 million pounds.     81.6(4) Maximum number of credits.  An eligible business shall not receive more than five tax credits under the program. Each tax credit must be applied for separately, and each application will be reviewed independently of past tax credits. Receipt of a tax credit in one year does not guarantee receipt of a tax credit in a subsequent year.     81.6(5) Tax credit wait list.      a.    The authority shall issue tax credits under the program on a first-come, first-served basis until the maximum amount of tax credits allocated pursuant to Iowa Code section 15.119(2)“h” is reached for any given fiscal year. The authority shall maintain a list of successful applicants under the program, so that if the maximum aggregate amount of tax credits is reached in a given fiscal year, eligible businesses that successfully applied but for which tax credits were not issued shall be placed on a wait list in the order the eligible businesses applied and shall be given priority for receiving tax credits in succeeding fiscal years.     b.    Placement on a wait list pursuant to this subrule shall not constitute a promise binding the state. The availability of a tax credit and issuance of a tax credit certificate pursuant to this rule in a future fiscal year is contingent upon the availability of tax credits in that particular fiscal year.    81.6(6) Termination and repayment.  The failure by an eligible business in fulfilling any requirement of the program or any of the terms and obligations of an agreement entered into pursuant to this chapter may result in the reduction, termination, or rescission of the tax credits under Iowa Code section 15.319 and may subject the eligible business to the repayment or recapture of tax credits claimed. The repayment or recapture of tax credits pursuant to Iowa Code section 15.319(4) shall be accomplished in the same manner as provided in Iowa Code section 15.330(2).     81.6(7) Issuance of credit.  The authority shall not issue a tax credit certificate prior to July 1, 2018.

261—81.7(15) Claiming the tax credit.      81.7(1) Maximum tax credit claimed.  An eligible business that has entered into an agreement pursuant to rule 261—81.5(15) may claim a tax credit in an amount equal to the product of five cents multiplied by the number of pounds of renewable chemicals produced in this state from biomass feedstock by the eligible business during a given production year within the limits set forth in rule 261—81.6(15). An eligible business may claim a tax credit for the production of more than one qualifying renewable chemical under this chapter, provided that the total tax credit claimed by the eligible business does not exceed the limits set forth in subrule 81.6(1). However, an eligible business shall not receive a tax credit for the production of a secondarily derived building block chemical if that chemical is also the subject of a credit at the time of production as a first product. The renewable chemical production tax credit shall not be available for any renewable chemical produced before the 2017 calendar year or after the 2026 calendar year.    81.7(2) Who may claim the credit.  The tax credit shall be allowed against taxes imposed under Iowa Code chapter 422, division II or III. The tax credit shall be claimed for the tax year during which the eligible business was issued the tax credit. An individual may claim a tax credit under this chapter of a partnership, limited liability company, S corporation, cooperative organized under Iowa Code chapter 501 and filing as a partnership for federal tax purposes, estate, or trust electing to have income taxed directly to the individual. The amount claimed by the individual shall be based upon the pro rata share of the individual’s earnings from the partnership, limited liability company, S corporation, cooperative, estate, or trust.     a.    To claim a tax credit under this rule, a taxpayer shall include one or more tax credit certificates with the taxpayer’s tax return.    b.    The tax credit certificate shall contain the taxpayer’s name, address, tax identification number, the amount of the credit, the name of the eligible business, and any other information required by the department of revenue.    c.    The tax credit certificate, unless rescinded by the authority, shall be accepted by the department of revenue as payment for taxes imposed pursuant to Iowa Code chapter 422, divisions II and III, subject to any conditions or restrictions placed by the authority upon the face of the tax credit certificate and subject to the limitations of the program.    81.7(3) Refundability.  Any tax credit in excess of the tax liability is refundable. In lieu of claiming a refund, the taxpayer may elect to have the overpayment shown on the taxpayer’s final, completed return credited to the tax liability for the following tax year.     81.7(4) Transferability.  Tax credit certificates issued pursuant to this chapter shall not be transferred to any other person.

261—81.8(15) Process to add building block chemicals.      81.8(1) General process.  The authority may add additional molecules to the definition of “building block chemical” in rule 261—81.2(15) pursuant to Iowa Code section 15.316. The authority may initiate the administrative rule-making process for the addition of such molecules to this chapter.     81.8(2) Request to include additional molecules.  Any individual or business may request that an additional molecule be added to the definition of “building block chemical” by submitting a written request to the authority. Such requests shall be made in the form prescribed by the authority and shall be submitted to the authority during the filing windows prescribed by the authority. At a minimum, the authority shall accept requests between April 1 and May 1 of each calendar year and October 1 and November 1 of each calendar year. The authority may adjust these dates under extenuating circumstances and will notify affected parties of such circumstances.    81.8(3) Consultation with experts.  Prior to initiating a rule making to add molecules to the definition of “building block chemical” in rule 261—81.2(15), the authority shall consult with appropriate experts from Iowa state university, including but not limited to the Iowa state university center for biorenewable chemicals. The authority shall conduct an initial staff review of any requests received by the authority pursuant to subrule 81.8(2). Following the initial staff review, the authority shall consult with the experts at Iowa state university regarding the molecules that the authority believes are consistent with the definitions under this chapter. The experts at Iowa state university shall provide a written recommendation to the authority indicating which chemicals, in the experts’ opinion, meet the definition of “building block chemical” consistent with this chapter.    81.8(4) Initiation of rule-making proceedings.  Following the consultation and review process set forth in subrule 81.8(3), the authority may initiate the administrative rule-making process to amend the definition of “building block chemical” to add molecules which the authority, in the authority’s sole discretion, finds to be consistent with the definitions in this chapter.

261—81.9(15) Additional information—confidentiality—annual report.      81.9(1) Additional information.  The authority may at any time request additional information and documentation from an eligible business regarding the operations, job creation, and economic impact of the eligible business, and the authority may use the information in preparing and publishing any reports to be provided to the governor and the general assembly.     81.9(2) Confidential information.  Except as provided in subrule 81.9(3), any information or record in the possession of the authority with respect to the program shall be presumed by the authority to be a trade secret protected under Iowa Code chapter 550 or common law and shall be kept confidential by the authority unless otherwise ordered by a court.    81.9(3) Public information.  The identity of a tax credit recipient and the amount of the tax credit shall be considered public information under Iowa Code chapter 22.       These rules are intended to implement Iowa Code sections 15.315 to 15.322.
ARC 2864CEconomic Development Authority[261]Notice of Intended Action

Twenty-five interested persons, a governmental subdivision, an agency or association of 25 or more persons may demand an oral presentation hereon as provided in Iowa Code section 17A.4(1)“b.”

Notice is also given to the public that the Administrative Rules Review Committee may, on its own motion or on written request by any individual or group, review this proposed action under section 17A.8(6) at a regular or special meeting where the public or interested persons may be heard.

    Pursuant to the authority of Iowa Code sections 15.106A, 15F.104, and 15F.401, the Economic Development Authority hereby gives Notice of Intended Action to adopt new Chapter 214, “Enhance Iowa Board,” and new Chapter 215, “Sports Tourism Program,” Iowa Administrative Code.    The proposed rules in Chapter 214 establish the Enhance Iowa Board, describe the composition of the Board, describe the Board’s voting procedures, designate the programs that the Board will oversee, and establish review committees for the programs the Board will oversee.    The proposed rules in Chapter 215 establish the Sports Tourism Program, add program definitions and set forth eligibility criteria for applicants. The proposed rules also describe the application process, establish an application review committee, set forth the application review criteria and describe the manner in which the program will be administered.    The Enhance Iowa Board approved this rule making at a Board meeting on November 9, 2016, and the Economic Development Authority Board approved this rule making at a Board meeting on November 18, 2016.     Interested persons may submit comments on or before January 10, 2017. Comments may be submitted to Kristin Hanks-Bents, Economic Development Authority, 200 East Grand Avenue, Des Moines, Iowa 50309; telephone (515)725-0440; e-mail kristin.hanks-bents@iowa.gov.    These rules do not have any fiscal impact to the state of Iowa.    After analysis and review of this rule making, no impact on jobs has been found.    These amendments are intended to implement Iowa Code sections 15F.102, 15F.103, 15F.104, 15F.203, 15F.304, 15F.401, and 15F.402 and 2016 Iowa Acts, chapter 1117.    The following amendments are proposed.

    ITEM 1.    Adopt the following new 261—Chapter 214: CHAPTER 214ENHANCE IOWA BOARD

261—214.1(15F) Definitions.  When used in this chapter, unless the context otherwise requires:         "Authority" means the economic development authority created in Iowa Code section 15.105.        "Board" means the enhance Iowa board as created in Iowa Code section 15F.102.

261—214.2(15F) Enhance Iowa board.      214.2(1) Composition.      a.    The board is composed of 11 voting members appointed by the governor. These 11 members include 2 members from each of the 4 United States congressional districts in the state and 3 members selected at large. In addition, the appointed members represent certain industry sectors and have certain business expertise as described in Iowa Code section 15F.102(3).    b.    The board also includes 4 ex officio, nonvoting legislative members as described in Iowa Code section 15F.102(4).    214.2(2) Terms.  Members of the board are appointed for staggered terms of two years beginning and ending as provided in Iowa Code section 69.19. A person appointed to fill a vacancy serves only for the unexpired portion of the term. A member is eligible for reappointment.    214.2(3) Quorum and voting requirements.  A majority of the total voting membership of the board constitutes a quorum. The affirmative vote of a majority of the quorum is necessary for any action taken by the board members.    214.2(4) Board officers.  The governor designates the chairperson and vice chairperson of the board from the members appointed pursuant to Iowa Code section 15F.102(2). In the case of absence or disability of the chairperson and vice chairperson, the members of the board shall elect a temporary chairperson by a majority vote of those members who are present and voting.    214.2(5) Duties.  The board shall do all of the following:    a.    Organize.    b.    Oversee the administration of the following programs:    (1)   Community attraction and tourism;    (2)   Sports tourism;    (3)   River enhancement community attraction and tourism; and    (4)   Vision Iowa.    c.    Review baseball and softball complex sales tax rebate applications and make awards.    214.2(6) Committees.  Each voting member of the board shall serve on at least one of three review committees for the following programs: community attraction and tourism, river enhancement community attraction and tourism, and sports tourism.

261—214.3(15F) Authority duties.      214.3(1)   The authority, subject to approval by the board, shall adopt administrative rules pursuant to Iowa Code chapter 17A necessary to administer the programs established pursuant to Iowa Code chapter 15F.    214.3(2)   The authority shall provide the board with assistance in implementing administrative functions, marketing the programs, providing technical assistance and application assistance to applicants under the programs, negotiating contracts, and providing project follow-up.    214.3(3)   The authority may conduct negotiations on behalf of the board with applicants regarding terms and conditions applicable to awards under the programs.       These rules are intended to implement Iowa Code sections 15F.101 to 15F.107.

    ITEM 2.    Adopt the following new 261—Chapter 215: CHAPTER 215SPORTS TOURISM PROGRAM

261—215.1(15F) Definitions.  When used in this chapter, unless the context otherwise requires:        "Accredited colleges and universities" means any college, university, or institution of higher learning that is accredited by the higher learning commission or any other college, university, or institution of higher learning that is accredited by an accrediting agency that is recognized by the U.S. Department of Education.        "Authority" means the economic development authority created in Iowa Code section 15.105.        "Board" means the enhance Iowa board as created in Iowa Code section 15F.102.        "Convention and visitors bureau" or “CVB” means an organization engaged primarily in the marketing and promotion of a local community or communities to businesses and to leisure travelers interested in the area’s facilities. Such organizations are typically engaged in a wide range of activities including but not limited to assisting businesses and leisure travelers in identifying meeting locations and convention sites; providing maps and other travel information; providing information on local attractions, lodging, and restaurants; and organizing tours of local historical, recreational, and cultural attractions.        "District" means a regional sports authority district certified under Iowa Code section 15E.321.        "Financial assistance" means assistance provided only from the funds available to the authority or the board and includes assistance in the form of grants, loans, and forgivable loans.        "Infrastructure" means equipment, appurtenant structures, or site development that is related to the operation of a sporting event that is the subject of the project.        "Marketing" means planning for or implementing efforts to publicize a sporting event using a range of strategies, tools and tactics.        "Organization" means a corporation, conference, association, or other organization which has as one of its primary purposes the sponsoring or administration of extracurricular intercollegiate athletic contests or competitions.        "Promote" means to undertake specific identifiable actions that encourage greater awareness of and attendance at a sporting event. This includes the planning, organizing, advertising, marketing, managing, hosting, and sponsoring of a sporting event.        "Public organization" means a not-for-profit economic development organization or other not-for-profit organization including one that sponsors or supports sporting events.        "Sporting event" means an athletic activity requiring skill or physical prowess, usually competitive in nature and governed by a set of rules provided by a nationally recognized sanctioning body. A sporting event typically includes the placing of competitors into a fixed order of finish, depending upon their respective athletic performance within the rules provided for that activity.        "Sports tourism program review committee” or “review committee" means the committee established by Iowa Code section 15F.402(2) and shall consist of members of the board, with one member from each congressional district under Iowa Code section 15F.102(2)“a” and one member from the state at large under Iowa Code section 15F.102(2)“b.”

261—215.2(15F) Eligible applicants.  Eligible applicants for sports tourism financial assistance include cities or counties in the state or public organizations, including convention and visitors bureaus.

261—215.3(15F) Eligible projects.  Eligible projects must actively and directly promote sporting events for accredited colleges and universities and other sporting events in the area served by an eligible applicant as defined in rule 261—215.2(15F).    215.3(1)   An eligible applicant may apply for and receive financial assistance for more than one project.    215.3(2)   An eligible applicant may apply for financial assistance for a project that spans multiple fiscal years.    215.3(3)   An eligible applicant may apply for renewal of financial assistance awarded in a prior year if all applicable contractual requirements are met. The decision as to whether to renew an award shall be at the discretion of the board. When considering whether to renew an award, the board shall evaluate metrics including the amount of revenue generated by ticket sales, the estimated economic impact, and the number of overnight stays at hotels in the city or county where the sporting event is being held. For example, economic impact may be calculated as total estimated attendance multiplied by daily attendee spending multiplied by average length of stay. If an eligible applicant wishes to supply an alternative formula for calculating economic impact, the applicant must supply a credible source for using an alternative formula. The authority may include such metrics and estimates in a program agreement executed pursuant to Iowa Code section 15F.401.    215.3(4)   A convention and visitors bureau shall not in the same year receive financial assistance under the program created in this chapter and financial assistance as part of a district created pursuant to 261—Chapter 38.    215.3(5)   An eligible applicant shall demonstrate matching funds in order to receive financial assistance pursuant to this rule. The amount of matching funds that may be required shall be at the board’s discretion.     215.3(6)   A city, county, or public organization may use financial assistance received under the program for marketing, promotions, and infrastructure. Whether an activity or individual cost item is directly related to the promotion of the sporting event shall be within the discretion of the authority.    215.3(7)   A city, county, or public organization shall not use financial assistance received under the program as reimbursement for completed projects.

261—215.4(15F) Threshold application requirements.  To be considered for funding under the sports tourism program, an application must meet the following threshold application requirements:    215.4(1)   There must be demonstrated local support for the proposed activity.    215.4(2)   A detailed description of the project, outlining the sporting event and the plan for promoting it.    215.4(3)   The proposed project budget must be spent on marketing, promotions, or infrastructure expenses directly related to the promotion of the sporting event.    215.4(4)   Detailed information and projections sufficient to enable the authority to accurately assess the economic impact of the sporting event described in the application. Such information shall include the estimated number of spectators and estimated quality and quantity of advertising and media coverage the sporting event will generate. If the applicant has previously held substantially similar events, the information shall include actual attendance figures from past events and a summary of the advertising and media coverage generated.

261—215.5(15F) Application process.      215.5(1)   Applications for assistance under the sports tourism program shall be submitted to the authority. For those applications that meet the threshold application requirements and the eligibility criteria, the authority shall forward the applications to the board and provide a staff review analysis and evaluation to the sports tourism program review committee and to the board.    215.5(2)   All applications to the authority for financial assistance shall be made at least 90 days prior to a sporting event’s scheduled date.    215.5(3)   When reviewing the applications, the review committee and the authority shall consider, at a minimum, all of the following:    a.    Impact of the project on the local, regional, and state economies.    b.    Potential to attract Iowans and out-of-state visitors.    c.    Amount of positive advertising or media coverage the project generates.    d.    Quality, size, and scope of the project.    e.    Ratio of public-to-private investment.    215.5(4)   Upon review of the recommendations of the review committee, the board shall make final funding decisions on each application. The board may approve, defer, deny, or modify applications for financial assistance under the program, in its discretion, in order to fund as many projects with the moneys available as possible. The board and the authority may negotiate with applicants regarding the details of projects and the amount and terms of any award. In making final funding decisions pursuant to this subrule, the board and the authority are exempt from Iowa Code chapter 17A.

261—215.6(15F) Administration.      215.6(1) Administration of awards.      a.    Each applicant receiving an award of financial assistance from the board shall enter into an agreement with the authority. The agreement shall contain such terms and conditions as the board may place on the award or the authority may deem necessary for the efficient administration of the program established in this chapter. Awards may be conditioned upon commitment of other sources of funds necessary to complete the project. The agreement will also include the terms and conditions under which financial assistance must be repaid or penalties incurred in the event the applicant does not fulfill all obligations under the agreement.    b.    These rules and applicable state laws shall be part of the agreement.    c.    The applicant must execute and return the contract to the board within 45 days of the transmittal of the final contract from the board. Failure to do so may be cause for the board to terminate the award.    d.    Awards may be conditioned upon commitment of other sources of funds necessary to complete the project.    e.    Awards may be conditioned upon authority receipt and board approval of an implementation plan for the funded project.    215.6(2) Reports.  An applicant receiving financial assistance shall provide an annual report to the authority for years in which it receives financial assistance under this rule. The report shall include the information the authority deems relevant. The report shall be submitted in the manner and on forms prescribed by the authority. The authority may perform any reviews or site visits necessary to ensure performance by the applicant.    215.6(3) Requests for funds.  Recipients shall submit requests for funds in the manner and on forms prescribed by the authority. Individual requests for funds shall be made in an amount equal to or greater than $500 per request, except for the final draw of funds.    215.6(4) Record keeping and retention.  The recipient shall retain all financial records, supporting documents and all other records pertinent to the sports tourism award for three years after contract closeout. Representatives of the authority shall have access to all recipient records that pertain to sports tourism funds.    215.6(5) Amendments to contracts.  Any substantive change to a contract shall be considered an amendment. Substantive changes include time extensions, budget revisions and significant alteration of the funded project that change the scope, location, objectives or scale of the approved project. Amendments must be approved by the enhance Iowa board.    215.6(6) Project closeout.  Upon expiration of the agreement, the authority shall initiate project closeout procedures.    215.6(7) Compliance.  If the board finds that an applicant is not in compliance with the requirements of this program or the terms and conditions of the agreement, the board may find the applicant noncompliant. Remedies for noncompliance may include penalties up to and including the return of program funds to the board. Reasons for a finding of noncompliance include but are not limited to the applicant’s use of funds for activities not described in the contract, the applicant’s failure to complete funded projects in a timely manner, the applicant’s failure to comply with applicable state or local rules or the lack of a continuing capacity of the applicant to carry out the approved project in a timely manner.       These rules are intended to implement Iowa Code sections 15F.401 and 15F.402.
ARC 2866CLabor Services Division[875]Notice of Intended Action

Twenty-five interested persons, a governmental subdivision, an agency or association of 25 or more persons may demand an oral presentation hereon as provided in Iowa Code section 17A.4(1)“b.”

Notice is also given to the public that the Administrative Rules Review Committee may, on its own motion or on written request by any individual or group, review this proposed action under section 17A.8(6) at a regular or special meeting where the public or interested persons may be heard.

    Pursuant to the authority of Iowa Code section 88.5, the Labor Commissioner hereby gives Notice of Intended Action to amend Chapter 10, “General Industry Safety and Health Rules,” Iowa Administrative Code.    The U.S. Department of Labor, Occupational Safety and Health Administration (OSHA) promulgated new standards concerning walking and working surfaces for general industry. The Iowa Labor Commissioner must adopt the federal standards by reference.    The federal standard changes align general industry requirements with construction requirements, which is beneficial to employers that perform both types of activities. The federal standard changes give employers greater flexibility over deciding what method of compliance to use. The standards are reorganized and written in plain language. The standards are updated to reflect new technology and to align with other OSHA standards and national consensus standards.     It is estimated that 29 fatalities and 5,842 lost-workday injuries per year will be prevented by the new standards.    Various provisions have delayed effective dates. One provision will not become effective until 2036.    After analysis and review of this rule making, jobs could be impacted. However, this amendment is implementing federally mandated regulations, and the State of Iowa is only implementing the federal regulations. The requirements imposed on Iowa businesses by these regulations do not exceed those imposed by federal law.    The principal reasons for adoption of this amendment are to implement legislative intent, protect the safety and health of Iowa workers, and make Iowa’s regulations current and consistent with federal regulations. Pursuant to Iowa Code subsection 88.5(1) and 29 CFR 1953.5, Iowa must adopt changes to the federal occupational safety and health standards.    If requested in accordance with Iowa Code section 17A.4(1)“b” by the close of business on January 10, 2017, a public hearing will be held on January 11, 2017, at 1:30 p.m. in the Capitol View Room at 1000 East Grand Avenue, Des Moines, Iowa. Interested persons will be given the opportunity to make oral statements and file documents concerning the proposed amendment. The facility for the oral presentations is accessible to and functional for persons with physical disabilities. Persons who have special requirements should call (515)281-5915 in advance to arrange access or other needed services.    Written data, views, or arguments to be considered in adoption shall be submitted by interested persons no later than January 11, 2017, to Division of Labor Services, 1000 East Grand Avenue, Des Moines, Iowa 50319-0209. Comments may be sent electronically to kathleen.uehling@iwd.iowa.gov.    No variance procedures are included in this rule. Variance procedures are set forth in 875—Chapter 5.    This amendment is intended to implement Iowa Code section 88.5 and 29 CFR 1953.5.    The following amendment is proposed.

    ITEM 1.    Amend rule 875—10.20(88) by inserting the following at the end thereof:81 Fed. Reg. 82981 (November 18, 2016)
ARC 2865CRevenue Department[701]Notice of Intended Action

Twenty-five interested persons, a governmental subdivision, an agency or association of 25 or more persons may demand an oral presentation hereon as provided in Iowa Code section 17A.4(1)“b.”

Notice is also given to the public that the Administrative Rules Review Committee may, on its own motion or on written request by any individual or group, review this proposed action under section 17A.8(6) at a regular or special meeting where the public or interested persons may be heard.

    Pursuant to the authority of Iowa Code sections 422.68 and 15.321, the Department of Revenue hereby gives Notice of Intended Action to amend Chapter 42, “Adjustments to Computed Tax and Tax Credits,” and Chapter 52, “Filing Returns, Payment of Tax, Penalty and Interest, and Tax Credits,” Iowa Administrative Code.    The proposed amendments are necessary to implement the Renewable Chemical Production Tax Credit Program that resulted from 2016 Iowa Acts, Senate File 2300, division II. The rules describe the Department of Revenue’s role in the program. Items 1 and 2 are largely the same; the distinction is that Item 1 sets forth the rule for individual income tax while Item 2 sets forth the rule for corporation income tax. The program is administered in coordination with the Economic Development Authority. The Economic Development Authority’s proposed rules on the program may be found in the Economic Development Authority’s Notice of Intended Action published herein as ARC 2867C.    Interested persons may make written comments on the proposed amendments on or before January 10, 2017. Written comments on the proposed amendments should be directed by mail to Alana Stamas, Policy Section, Policy and Communications Division, Department of Revenue, Hoover State Office Building, P.O. Box 10457, Des Moines, Iowa 50306-0457; or by e-mail to alana.stamas@iowa.gov. Persons who wish to convey their views orally should contact the Policy Section, Policy and Communications Division, Department of Revenue by telephone at (515)725-2265 or at the Department of Revenue offices on the fourth floor of the Hoover State Office Building.    Requests for a public hearing must be made no later than January 10, 2017.    These amendments do not have a fiscal impact.    Any person who believes that the application of the discretionary provisions of these rules would result in hardship or injustice to that person may petition the Department for a waiver of the discretionary provisions, if any, pursuant to rule 701—7.28(17A).    These amendments have no known impact on jobs.    These amendments are intended to implement Iowa Code chapters 15 and 422.    The following amendments are proposed.

    ITEM 1.    Adopt the following new rule 701—42.56(15,422):

701—42.56(15,422) Renewable chemical production tax credit program.  An eligible business that has received a renewable chemical production tax credit certificate from the economic development authority may claim a tax credit against individual income tax. The credit is equal to the product of five cents multiplied by the number of pounds of renewable chemicals produced in Iowa from biomass feedstock by the eligible business during a given production year, subject to the limitations described in Iowa Code sections 15.315 through 15.322, 261—Chapter 81, and this rule. When adopted, the economic development authority’s rules on eligibility for the credit may be found in 261—Chapter 81.     42.56(1) Application and agreement for the credit.  To be eligible for the tax credit, the eligible business must apply to and enter into an agreement with the economic development authority. When adopted, the economic development authority’s rules on the application and agreement process may be found in 261—Chapter 81.     42.56(2) Computation of the amount of credit and certificate issuance.   Upon establishing that all requirements of the program and the agreement have been fulfilled and verifying the taxpayer’s eligibility for the tax credit, the economic development authority calculates the credit. Then the economic development authority issues the related tax credit certificate to the eligible business stating the amount of the renewable chemical production tax credit that the eligible business may claim. A tax credit certificate shall not be issued by the economic development authority prior to July 1, 2018. When adopted, the economic development authority’s rules on credit certificate issuance may be found in 261—Chapter 81.     42.56(3) Claiming the tax credit.      a.    Claiming the credit, generally. To claim the credit, a taxpayer must include one or more tax credit certificates with the taxpayer’s tax return for the tax year during which the eligible business was issued the tax credit certificate or certificates. If the taxpayer claiming the credit has already filed a return for the tax year for which the credit certificate was issued, the taxpayer may claim the credit on an amended return. The taxpayer must file the amended return within the statute of limitations applicable to such amended return. No tax credit may be claimed under this program by a taxpayer prior to September 1, 2018.    b.    Claiming the credit of a pass-through entity. To claim the credit of an eligible business that is a pass-through entity, an individual taxpayer must claim the credit on the tax return for the tax year during which the eligible business received the tax credit certificate. Such tax year may be either the tax year of the eligible business or of the individual. Example: A partnership has a fiscal year of September 2017 through August 2018. The partnership receives a renewable chemical production tax credit certificate under this program in July 2018, which is during the partnership’s 2017 tax year. A partner in the partnership files individual returns on a calendar year basis, which means that the credit was issued in the partner’s 2018 tax year. That partner may file an amended 2017 tax return to claim the credit based on the partnership’s tax year, or that partner may claim the credit on the partner’s 2018 tax return based on the partner’s own tax year.     c.    Information required. The tax credit certificate shall include the taxpayer’s name, address, tax identification number, the amount of the credit, the name of the eligible business, and any other information required by the department of revenue.    d.    Allocation to the individual owners of the entity or beneficiaries of an estate or trust. An individual may claim the credit of a partnership, limited liability company, S corporation, cooperative organized under Iowa Code chapter 501 and filing as a partnership for tax purposes, estate, or trust electing to have income taxed directly to the individual. The amount claimed by the individual shall be based on the pro rata share of the individual’s earnings from the partnership, limited liability company, S corporation, cooperative, estate, or trust.     e.    Refundability. Any credit in excess of the tax liability is refundable. In lieu of claiming a refund, the taxpayer may elect to have the overpayment shown on the taxpayer’s final, completed return credited to the tax liability for the following tax year.     f.    Transferability. Tax credit certificates shall not be transferred to any other person.     g.    Rescission and recapture. The tax credit certificate, unless rescinded by the economic development authority, shall be accepted by the department of revenue, subject to any conditions or restrictions placed upon the face of the tax credit certificate by the economic development authority and subject to the limitations of the program. Should the economic development authority reduce, terminate, or rescind any tax credits issued under the program, the eligible business may be subject to the repayment or recapture of any credits already claimed. When adopted, the economic development authority’s rules related to the program may be found in 261—Chapter 81. The repayment of tax credits or recapture by the department of revenue shall be accomplished in the same manner as provided in Iowa Code section 15.330(2). This rule is intended to implement Iowa Code chapter 422.

    ITEM 2.    Adopt the following new rule 701—52.49(15,422):

701—52.49(15,422) Renewable chemical production tax credit program.   An eligible business that has received a renewable chemical production tax credit certificate from the economic development authority may claim a tax credit against corporation income tax. The credit is equal to the product of five cents multiplied by the number of pounds of renewable chemicals produced in Iowa from biomass feedstock by the eligible business during a given production year, subject to the limitations described in Iowa Code sections 15.315 through 15.322, 261—Chapter 81, and this rule. When adopted, the economic development authority’s rules on eligibility for the credit may be found in 261—Chapter 81.    52.49(1) Application and agreement for the credit.   To be eligible for the tax credit, the eligible business must apply to and enter into an agreement with the economic development authority. When adopted, the economic development authority’s rules on the application and agreement process may be found in 261—Chapter 81.    52.49(2) Computation of the amount of credit and certificate issuance.   Upon establishing that all requirements of the program and the agreement have been fulfilled and verifying the taxpayer’s eligibility for the tax credit, the economic development authority calculates the credit. Then the economic development authority issues the related tax credit certificate to the eligible business stating the amount of the renewable chemical production tax credit that the eligible business may claim. A tax credit certificate shall not be issued by the economic development authority prior to July 1, 2018. When adopted, the economic development authority’s rules on credit certificate issuance may be found in 261—Chapter 81.     52.49(3) Claiming the tax credit.      a.    Claiming the credit, generally. To claim the credit, a taxpayer must include one or more tax credit certificates with the taxpayer’s tax return for the tax year during which the eligible business was issued the tax credit certificate or certificates. If the taxpayer claiming the credit has already filed a return for the tax year for which the credit certificate was issued, the taxpayer may claim the credit on an amended return. The taxpayer must file the amended return within the statute of limitations applicable to such amended return. No tax credit may be claimed under this program by a taxpayer prior to September 1, 2018.    b.    Claiming the credit of a pass-through entity. To claim the credit of an eligible business that is a pass-through entity, an individual taxpayer must claim the credit on the tax return for the tax year during which the eligible business received the tax credit certificate. Such tax year may be either the tax year of the eligible business or of the individual. Example: A partnership has a fiscal year of September 2017 through August 2018. The partnership receives a renewable chemical production tax credit certificate under this program in July 2018, which is during the partnership’s 2017 tax year. A partner in the partnership files individual returns on a calendar year basis, which means that the credit was issued in the partner’s 2018 tax year. That partner may file an amended 2017 tax return to claim the credit based on the partnership’s tax year, or that partner may claim the credit on the partner’s 2018 tax return based on the partner’s own tax year.    c.    Information required. The tax credit certificate shall include the taxpayer’s name, address, tax identification number, the amount of the credit, the name of the eligible business, and any other information required by the department of revenue.    d.    Allocation to the individual owners of the entity or beneficiaries of an estate or trust. An individual may claim the credit of a partnership, limited liability company, S corporation, cooperative organized under Iowa Code chapter 501 and filing as a partnership for tax purposes, estate, or trust electing to have income taxed directly to the individual. The amount claimed by the individual shall be based on the pro rata share of the individual’s earnings from the partnership, limited liability company, S corporation, cooperative, estate, or trust.    e.    Refundability. Any credit in excess of the tax liability is refundable. In lieu of claiming a refund, the taxpayer may elect to have the overpayment shown on the taxpayer’s final, completed return credited to the tax liability for the following tax year.     f.    Transferability. Tax credit certificates shall not be transferred to any other person.     g.    Rescission and recapture. The tax credit certificate, unless rescinded by the economic development authority, shall be accepted by the department of revenue, subject to any conditions or restrictions placed upon the face of the tax credit certificate by the economic development authority and subject to the limitations of the program. Should the economic development authority reduce, terminate, or rescind any tax credits issued under the program, the eligible business may be subject to the repayment or recapture of any credits already claimed. When adopted, the economic development authority’s rules related to the program may be found in 261—Chapter 81. The repayment of tax credits or recapture by the department of revenue shall be accomplished in the same manner as provided in Iowa Code section 15.330(2). This rule is intended to implement Iowa Code chapter 422.
ARC 2868CSoil Conservation and Water Quality Division[27]Notice of Intended Action

Twenty-five interested persons, a governmental subdivision, an agency or association of 25 or more persons may demand an oral presentation hereon as provided in Iowa Code section 17A.4(1)“b.”

Notice is also given to the public that the Administrative Rules Review Committee may, on its own motion or on written request by any individual or group, review this proposed action under section 17A.8(6) at a regular or special meeting where the public or interested persons may be heard.

    Pursuant to the authority of Iowa Code sections 207.21(5)“a” and 208.17(5), the Division of Soil Conservation and Water Quality hereby gives Notice of Intended Action to amend Chapter 6, “Contracts for Public Improvements and Professional Services,” Iowa Administrative Code.    Under the proposed amendments, the minimum estimate for abandoned mined land reclamation work and maintenance projects requiring public bidding would be increased from $25,000 to $100,000. Competitive quotations can be used for work estimated to cost less than $100,000. These amendments would require notice to be posted on Web sites instead of published in newspapers, and the minimum number of days for notice would be changed from 15 days to 13 days.     Any interested persons may make written suggestions or comments on the proposed amendments on or before January 10, 2017. Written comments should be addressed to Margaret Thomson, Iowa Department of Agriculture and Land Stewardship, Wallace State Office Building, 502 East Ninth Street, Des Moines, Iowa 50319. Comments may be submitted by fax to (515)281-6236 or by e-mail to Margaret.Thomson@IowaAgriculture.gov.    The proposed amendments are subject to the Division’s general waiver provision.     After analysis and review of this rule making, no adverse impact on jobs has been found.    These amendments are intended to implement Iowa Code section 26.3 and 2016 Iowa Acts, Senate File 2170.    The following amendments are proposed.

    ITEM 1.    Amend rule 27—6.2(17A,161A,159,207,208), parenthetical implementation statute, as follows:

27—6.2(17A,26,161A,159,207,208) Contracts for public improvements.  

    ITEM 2.    Amend subrule 6.2(2) as follows:    6.2(2)  Invitation for bids.  When the total estimated cost of a public improvement project exceeds the sum of $25,000$100,000, the division shall advertise for sealed bids by publishingposting a notice of “Invitation for Bids” in at least one newspaper of statewide circulation, one newspaper published in the county seat of the county in which the work is to be done and such other means as may be appropriate in sufficient time to enable prospective bidders to prepare and submit bids, provided that one of said notices shall beon the department’s Web site, a relevant contractor plan room service with statewide circulation and a relevant construction lead generating service with statewide circulation not less than 1513 days prior to the date set for receiving bids. Where work is to be done under the contract in more than three counties, the requirement of publication in the county seat shall not be required so long as other means of notice to bidders is given, as in trade journals or other such means. Plans, specifications and the contract form shall be provided to all prospective bidders as provided in the invitation for bids.

    ITEM 3.    Amend subrule 6.2(4) as follows:    6.2(4)  Solicitation of quotations.  Competitive quotations may be solicited on public improvement projects estimated by the division to cost less than $25,000$100,000. At least three quotations shall be solicited unless there are an insufficient number of local, qualified contractors interested in the project.

    ITEM 4.    Amend 27—Chapter 6, implementation sentence, as follows:       These rules are intended to implement Iowa Code chapters 17A, 159, 161A, 207 and 208and Iowa Code section 26.3.
ARC 2863CTransportation Department[761]Notice of Intended Action

Notice is also given to the public that the Administrative Rules Review Committee may, on its own motion or on written request by any individual or group, review this proposed action under section 17A.8(6) at a regular or special meeting where the public or interested persons may be heard.

    Pursuant to the authority of Iowa Code sections 307.12, 307A.2 and 364.24, the Iowa Department of Transportation hereby gives Notice of Intended Action to amend Chapter 143, “Traffic Signal Synchronization,” Iowa Administrative Code.    The proposed amendments add an adaptive signal control system to the types of coordinated traffic signal systems listed within rule 761—143.1(364) and make a coordinating change within subrule 143.4(1). The addition of the latest, most current method of traffic signal coordination will ensure that the rules are updated to current technology.    These rules do not provide for waivers. Any person who believes that the person’s circumstances meet the statutory criteria for a waiver may petition the Department for a waiver under 761—Chapter 11.     Any person or agency may submit written comments concerning these proposed amendments or may submit a written request to make an oral presentation. The comments or request shall:

  1. Include the name, address, and telephone number of the person or agency authoring the comments or request.
  2. Reference the number and title of the proposed rule, as given in this Notice, that is the subject of the comments or request.
  3. Indicate the general content of a requested oral presentation.
  4. Be addressed to Tracy George, Rules Administrator, Iowa Department of Transportation, Operations and Finance Division, 800 Lincoln Way, Ames, Iowa 50010; e-mail: tracy.george@iowadot.us.
  5. Be received by the Department’s rules administrator no later than January 10, 2017.
    A meeting to hear requested oral presentations is scheduled for Thursday, January 12, 2017, at 9 a.m. in the Administration Building, First Floor, South Conference Room, Iowa Department of Transportation, 800 Lincoln Way, Ames, Iowa.     The meeting will be canceled without further notice if no oral presentation is requested.    After analysis and review of this rule making, no impact on jobs has been found.    These amendments are intended to implement Iowa Code section 364.24.    The following amendments are proposed.

    ITEM 1.    Amend rule 761—143.1(364), definition of “Traffic signal system,” as follows:        "Traffic signal system" means two or more traffic signals operating in a coordinated manner. Types of coordinated systems:
  1. “Adaptive signal control system” means a system in which traffic signals across a signal network are coordinated by adjusting the lengths of signal phases based on prevailing traffic conditions.
  2. 1“Computerized system” means a system in which controllers are supervised by a computer.
  3. 2“Interconnected master-controlled system” means a system in which local controllers are supervised by a master controller through a communications link (wire/radio). The master establishes a base line condition; the local then operates its intersection in a predetermined relationship with the base line.
  4. 3 “Noninterconnected system” means a system in which timing relationships between individual local controllers are coordinated by manual settings, without physical interconnection between the controllers.
  5. 4“Time-based coordinated system” means a noninterconnected system in which the local controllers use a very accurate programmable digital timing and control device (time-based coordinator) to maintain coordination.
  6. 5“Traffic responsive system” means a system in which a master controller specifies cycle timings based on the real time demands of traffic as sensed by vehicle detectors.

    ITEM 2.    Amend subrule 143.4(1) as follows:    143.4(1)   Unless a traffic engineering study documents that it is not practical, traffic signals within one-half mile of each other along an arterial street or in a network of intersecting arterial streets shall be operated in coordination; preferably in a computerized, interconnected master-controlled, time-based coordinated, or traffic responsive systemas a traffic signal system.
ARC 2869CBanking Division[187]Filed Emergency After Notice

    Pursuant to the authority of 2016 Iowa Acts, House File 2436, section 20 [Iowa Code section 543E.20], the Iowa Division of Banking (IDOB) hereby adopts new Chapter 25, “Appraisal Management Companies,” Iowa Administrative Code.    The adoption of Chapter 25 is related to the Superintendent of Banking’s role as administrator of the Iowa Appraisal Management Company Registration and Supervision Act (“the Act”), which was enacted by 2016 Iowa Acts, House File 2436, division I [Iowa Code chapter 543E], and which passed unanimously in both chambers during the 2016 Legislative Session. The Act gives the superintendent the authority to promulgate rules to administer the Act. Appraisal management companies (AMCs) assist banks and other mortgage lenders with satisfying the independent appraisal requirements of the Dodd-Frank Act by contracting with independent appraisers, and many Iowa banks already use AMCs. Federal regulations state that an AMC will not be able to perform services for a federally related residential mortgage transaction in Iowa after August 10, 2018, unless the AMC is registered with the state. The Act is intended to ensure that Iowa mortgage lenders may continue to use AMCs and closely follow the federal minimum standards for AMC regulation.    Chapter 25 is intended to implement the Act and ensure that AMCs are able to register and operate in Iowa without interruption. Enabling registration and ensuring continuous operation are especially important because the Act requires AMCs to be registered with the state as of January 1, 2017. These rules define the procedures for an application for registration as an AMC in Iowa, enumerate the fees applicable to AMCs, and set out other elements of AMC regulation. In the interest of making state government more efficient and transparent, the structure of these rules is very similar to the structure of other rules applicable to nondepository financial institutions. These rules have been reviewed by interested parties, including AMCs, the AMC trade association, Iowa bankers, Iowa credit unions, and Iowa appraisers, and these stakeholders have been supportive of these rules.    Notice of Intended Action was published in the Iowa Administrative Bulletin as ARC 2773C on October 12, 2016. A public hearing was held on November 1, 2016. Public comments were received and considered and are described below.    The Real Estate Valuation Advocacy Association (REVAA) made seven comments related to the proposed Chapter 25. First, REVAA commented that background checks for all owners of a registered AMC would be burdensome and should be limited to those who surpass a minimum threshold of ownership such as 10 percent. The IDOB agrees and notes that 2016 Iowa Acts, House File 2436, section 6 [Iowa Code section 543E.6], specifies that background checks are required only for those who own more than 10 percent of an AMC, and that proposed rule 187—25.1(17A,543E) defines the terms “owner” and “ownership” as encompassing only persons who own or have the power to vote more than 10 percent of the shares of an AMC. The IDOB believes that the statute and rule adequately address REVAA’s comment.    Second, REVAA commented that the notification periods should be consistent for the requirements in proposed rule 187—25.6(17A,543E) that an AMC must notify the administrator of a change in name, principal location, ownership, or controlling person. The notification requirements in proposed rule 187—25.6(17A,543E) ranged from 10 days to 30 days. REVAA further commented that the period for all required notifications should be 30 days. The IDOB agrees that consistency in the rules is desirable and beneficial to registrants but notes a distinction between changes that require advance notification and approval by the administrator, such as changes in ownership or controlling person, and changes of which the administrator may be notified after the fact, such as changes in name or principal location. The IDOB agrees that the notification period for changes in name or principal location, for which notice may be given after the fact, should be consistent. The IDOB has therefore revised proposed subrule 25.6(1) to require a registrant to notify the administrator within 15 days of a change in principal location, making the notification period consistent with that for a change in name in proposed subrule 25.6(2). However, the IDOB declines to extend the notification period for changes in name or principal location to 30 days. After careful consideration, the IDOB remains convinced that 15 days is a sufficient period of time for registrants to provide these notifications, particularly considering that registrants may make these changes without notifying the administrator in advance.    REVAA’s third comment proposed that the notification period for the required notices in rule 187—25.7(17A,543E), relating to the filing of criminal charges or administrative action against, or the commencement of bankruptcy or reorganization proceedings by, a registrant or a registrant’s officers, directors, owners, or affiliates, be extended from 15 days to 30 days. The IDOB agrees that clarity is important with regard to notices and for that reason proposed a notice period demarcated in calendar days rather than business days. REVAA also commented that other states impose notice requirements for these events with notification periods ranging from 5 or 10 business days up to 30 calendar days. The IDOB has selected a notice requirement that is neither the most nor the least restrictive, compared to the requirements in other states. The rule’s requirements are also similar to the notice requirements that the IDOB imposes on other regulated mortgage industry participants. The IDOB therefore declines to extend the notice requirement beyond 15 days. In addition, REVAA commented that this requirement would be burdensome for registrants because it would be difficult for AMCs to be aware when one of these significant events affects an officer or director of an affiliate or parent organization of an AMC. The rule would not require an AMC to notify the administrator in this situation. The rule applies only to the registrant and the registrant’s officers, directors, owners, and affiliates. If an owner or affiliate of a registered AMC is itself a corporation or other organization, with its own officers, directors, and owners, the rule would not require disclosure of significant events affecting the officers, directors, or owners of the parent or affiliate organization. The rule would require disclosure of the relevant filings by or against the parent or affiliate organization, nothing more. If a person is an officer, director, or owner of a registrant and is an officer, director, or owner of the registrant’s parent or affiliate organization, however, the rule would require notice to the administrator because of the person’s position as an officer, director, or owner of a registered AMC. The IDOB believes this addresses the concern raised in REVAA’s comment.    REVAA’s fourth comment suggested that the notice provision in subrule 25.7(3) be revised to apply only to final formal regulatory action instituted against a registrant or the registrant’s officers, directors, owners, or affiliates. After careful consideration, the IDOB believes that making such a change would undermine the purpose of the proposed rule. REVAA’s proposed revision would give the administrator notice of regulatory action taken against a registered AMC only after the action became final. But each of the notifications required by rule 187—25.7(17A,543E) is triggered by the commencement of bankruptcy or reorganization proceedings, the filing of criminal charges, or the institution of regulatory action. All of these notification requirements are intended to give the administrator notice as soon as one of these significant events involving a registrant begins, not merely to notify the administrator after the issue has been fully resolved. The IDOB therefore declines to adopt REVAA’s suggestion. REVAA also inquired as to the meaning of the word “formal” within the phrase “or other formal regulatory action against the registrant.” The IDOB recognizes that this term may be confusing. Rather than adopt a definition of the term “formal regulatory action” or add a term like “informal regulatory action,” the IDOB has concluded that the simplest approach is to delete the word “formal.” As such, a registered AMC will be required to notify the administrator of any “other regulatory action” instituted against it. REVAA also suggested that “other regulatory action” be restricted to actions “related to AMC regulations.” The IDOB has considered this comment, and believes that it would be inappropriate to limit the notification requirement in this manner. Notice that another state or jurisdiction has instituted regulatory action against a registrant or its officers, directors, or affiliates does not give the administrator grounds for discipline. Instead, subrule 25.7(3) requires registrants to notify the administrator of these events so that the administrator is aware of potential problems from the outset. The IDOB’s experience regulating other financial entities has demonstrated that it is beneficial for the regulator to obtain access to this information as soon as possible. That experience also indicates that sharing information in this manner at the earliest opportunity helps to build a more productive relationship between the IDOB and regulated entities. The IDOB therefore declines to adopt this suggestion.    REVAA commented that the fees for change of ownership or change of controlling person are too high relative to the registration fee for AMCs, that the late fee is excessive, and that there is no limit on investigation fees. After review, the IDOB notes that the proposed $50 late fee compares favorably to the late fees assessed by the existing regulatory boards within the Professional Licensing Bureau and declines to change the late fee. The IDOB also concluded that the examination and investigation fees, which are fixed at a rate of $100 per hour, are reasonable. However, the IDOB acknowledges, after review, that the language in the fee table in proposed subrule 25.8(5) was ambiguous regarding the investigation fee. The IDOB has therefore revised the description of this fee in the fee table in proposed subrule 25.8(5) to clarify that the $100 hourly rate applies to both examinations and investigations. The IDOB also agrees that its fees should be compared to those charged in other states. In response to REVAA’s comment, the IDOB reviewed the fees for application, initial registration, annual renewal, and changes in ownership or controlling person from proposed subrule 25.8(5) and compared them to the fees charged in other states. Based on this review, the IDOB concluded that the proposed $750 combined fee for becoming registered ($250 application fee + $500 initial registration fee) is substantially lower than the 39-state average of $1,464 and the $1,755 average in states contiguous to Iowa. The IDOB has therefore decided to increase the initial registration and annual renewal fees to $750 and to keep the application fee unchanged. The IDOB has also concluded that it is appropriate to reduce the fees for change of ownership or controlling person from $250 to $150. The fees for change of ownership or controlling person are thereby substantially lower in absolute terms and relative to the cost of registration. The revised total cost of becoming registered, $1,000 ($250 application fee + $750 initial registration fee), also remains well below the 39-state average cost and the average cost in contiguous states.    REVAA next commented that proposed subrule 25.10(1), which provides that the administrator may investigate or examine a registered AMC “at any time and as often as the administrator deems necessary,” is overly broad. REVAA suggested that the IDOB remove the phrase “at any time and as often as the administrator deems necessary.” The IDOB’s long experience regulating other financial entities, including those involved in the mortgage industry, indicates that regulation is more effective if examinations are conducted on a regular basis, not only when a triggering event has precipitated an examination. This approach fosters a better working relationship between regulated entities and the IDOB and promotes a combined effort towards compliance rather than instilling a mindset that the IDOB conducts examinations only because violations have been reported or detected. However, the IDOB agrees that its authority to conduct investigations pursuant to 2016 Iowa Acts, House File 2436, section 20 [Iowa Code section 543.20], is tied to assessing potential violations of appraisal-related laws, regulations, rules, and orders. The IDOB therefore declines to adopt REVAA’s suggestion but has revised proposed subrule 25.10(1) to clearly ground the subrule in the statutory language that gives the administrator this authority.    Finally, REVAA commented that the grounds for discipline in proposed paragraph 25.11(2)“g” are unclear, allow the administrator to take disciplinary action against an AMC without adequately considering all the facts and circumstances surrounding action taken in another jurisdiction, and allow the administrator to discipline an AMC for conduct that did not occur in Iowa or affect Iowans. After careful review, the IDOB has concluded that 2016 Iowa Acts, House File 2436, section 17 [Iowa Code section 543E.17], specifically authorizes this paragraph. The statutory language provides that the administrator may, after notice and hearing, discipline a registrant, and the statutory language specifies that the permissible grounds for such discipline include the “[c]ancellation, revocation, suspension, or refusal to renew the authority to practice as an appraisal management company, or the acceptance of the voluntary surrender of a registration to practice as an appraisal management company to conclude a disciplinary investigation or action, by any other state, a federal agency, or foreign authority for any cause other than failure to pay appropriate fees in the other jurisdiction.” The IDOB concludes that the statute does not preclude the administrator from taking disciplinary action against a registered AMC for conduct that occurs outside the state of Iowa. The IDOB also concludes that the paragraph is sufficiently clear and that the requirement for the administrator to give notice and hold a hearing before taking disciplinary action adequately addresses REVAA’s concern that the IDOB will not take into account the facts and circumstances surrounding events that occur in another jurisdiction. The IDOB therefore declines to adopt REVAA’s suggestion.    The IDOB made several changes in addition to those made in response to public comments received. The IDOB made a conforming change to subrule 25.2(3) clarifying that, as with other aspects of the application process, the administrator may require fingerprint background checks through either the NMLS or other means the administrator deems appropriate. The IDOB revised subrule 25.8(3) by replacing the word “administrating” with the word “administering.” The IDOB revised the fees in subrule 25.8(5) by deleting the prefatory language, raising the conversion fee for preregistered persons from $125 to $150 in order to make it consistent with other fees, and adding a $25 fee to request a letter of good standing. The IDOB revised paragraph 25.9(2)“a” by creating one sentence to indicate that AMCs must keep a record of the appraiser assigned to each request for appraisal services and a separate sentence indicating the information AMCs must include in that record. The IDOB revised the final sentence of subrule 25.13(2) to emphasize that the administrator’s approval of an application for preregistration will not cause a preregistered entity to be listed on the federal registry of appraisal management companies. The IDOB also revised subrule 25.13(3) to clarify that a preregistered person applying for conversion to registered status must submit the conversion fee, the initial registration fee, and the appropriate fee for listing on the federal registry. Finally, references to 2016 Iowa Acts, House File 2436, have been updated to reflect the codification of Iowa Code chapter 543E.    Pursuant to Iowa Code section 17A.5(2)“b”(1)(b), the IDOB finds that the normal effective date of these rules, 35 days after publication, should be waived and the rules made effective January 1, 2017. These rules confer a benefit and remove a restriction on the regulated public in that the rules enable AMCs to register with the state as required by 2016 Iowa Acts, House File 2436, section 20 [Iowa Code section 543E.20], which requires all AMCs doing business in Iowa to be registered, effective January 1, 2017. If these rules are not effective by that date, the many AMCs already doing business in Iowa will be unable to register and therefore unable to do business until the rules take effect. Many Iowa banks and mortgage lenders already use the services of AMCs doing business in Iowa. Ensuring that these rules are effective as of January 1, 2017, will enable AMCs already doing business in Iowa to become registered as soon as required by law and to continue to operate without interruption.    The IDOB is mindful of the potential impact that these rules and the associated fees may have on the cost of state government and on Iowa jobs and has worked to keep these fees as low as possible. The fees are set below the national average and at a level designed only to cover the costs the IDOB incurs in administering the statute. The IDOB believes setting fees at this level will enable the industry to continue operating in Iowa and will ensure efficient regulation while minimizing the impact of fees and avoiding burdensome costs to regulated entities. The IDOB also acknowledges that the $750 annual registration fee will likely have some effect on jobs, but anticipates that the effect will be minimal and notes that, without these rules, Iowa would likely suffer a greater adverse effect on jobs due to the inability of AMCs to operate in the state.     These rules are intended to implement Iowa Code chapter 17A and 2016 Iowa Acts, House File 2436, division I [Iowa Code chapter 543E].    This amendment will become effective January 1, 2017.    The following amendment is adopted.

    ITEM 1.    Adopt the following new 187—Chapter 25: CHAPTER 25APPRAISAL MANAGEMENT COMPANIES

187—25.1(17A,543E) Definitions.   For the purposes of this chapter, the definitions in Iowa Code chapter 543E shall apply. In addition, unless the context otherwise requires, the following definitions shall apply:        "Nationwide multistate licensing system" "NMLS" means a mortgage licensing system owned and operated by the State Regulatory Registry, LLC, a wholly owned subsidiary of the Conference of State Bank Supervisors.        "Owner" means a person who owns or has the power to vote more than 10 percent of the shares of an appraisal management company.         "Ownership" means being an owner or otherwise having the power to vote more than 10 percent of the shares of an appraisal management company.         "Registrant" means a person who is registered as an appraisal management company in this state.

187—25.2(17A,543E) Application for registration.       25.2(1)   An application for registration to operate an appraisal management company in Iowa shall be submitted to the administrator through the NMLS or as otherwise prescribed by the administrator. All information requested in the application shall be provided on or with the application form, including but not limited to any and all information required by Iowa Code section 543E.8(2). The administrator may consider an application withdrawn if the application does not contain all of the information required and the missing information is not submitted to the administrator within 30 days after the administrator requests the missing information.    25.2(2)   Appraiser panel. The application shall include a list of all certified and licensed appraisers who are independent contractors and are currently on the applicant’s appraiser panel and shall also include any additional certified and licensed appraisers who are independent contractors and who in the 12 months immediately preceding submission of the application have performed appraisals, for the applicant or for persons that have ordered appraisals through the applicant, for covered transactions or for secondary mortgage market participants in connection with covered transactions in which the dwelling is located in this state. The application shall include the name, the certification or license number, the date the appraiser joined the panel, and the date the appraiser left the panel, if applicable, for each appraiser included on the applicant’s appraiser panel. The applicant’s appraiser panel shall include all appraisers the applicant has engaged to perform one or more appraisals for or in connection with a covered transaction or for a secondary mortgage market participant in connection with a covered transaction in this state and all appraisers the applicant has accepted for future consideration for such appraisal assignments.     25.2(3)   All owners and controlling persons of the applicant must authorize a fingerprint background check, through the NMLS or as otherwise prescribed by the administrator, for the purpose of conducting a national criminal history background check through the Federal Bureau of Investigation. This requirement applies to all owners and controlling persons, regardless of whether the individual has previously applied as an owner or controlling person of an appraisal management company under Iowa Code chapter 543E.    25.2(4)   The applicant shall submit an application fee, initial registration fee, and background investigation fee in the amounts provided in subrule 25.8(5), as well as the fee required for registration on the appraisal management company national registry maintained by the appraisal subcommittee as specified in subrule 25.8(5). The applicant shall also pay any additional fees required by the NMLS, including but not limited to, the following: system processing fees and background check fees. The applicant will be refunded the initial registration fee and the appraisal management company national registry fee if the application is denied.    25.2(5)   If any information material to the application changes after the applicant files the initial application but before the administrator approves or denies the application, the applicant shall provide updated information to the administrator in writing within 10 calendar days of the change. The administrator may deny the application when such a material change in information has occurred and the applicant has failed to provide updated information within the prescribed time frame.    25.2(6)   An applicant for registration to operate an appraisal management company in Iowa must file with the administrator a $25,000 surety bond in compliance with the provisions of Iowa Code section 543E.19.    25.2(7)   A registration shall lapse on the next succeeding December 31 after it is issued, but a registration granted on or after November 1 and before December 31 shall not lapse until December 31 of the following year. For example, a registration granted on November 17, 2017, would not expire until December 31, 2018. An applicant whose registration is granted on or after November 1 and before December 31 may be required, as determined by the appraisal subcommittee, to pay the fee for registration on the appraisal management company national registry in full for both calendar years. For example, while a registration granted on November 17, 2017, would not lapse until December 31, 2018, the registrant may be required to pay the national registry fee in full for 2017 and 2018.

187—25.3(17A,543E) Grounds for denial of a registration.   The administrator may deny an application for registration to operate an appraisal management company, or issue a registration subject to restriction, for any of the reasons that follow.    25.3(1)   This state or another state or jurisdiction has canceled, revoked, denied, suspended, or refused to renew the applicant’s registration to operate an appraisal management company or has denied, suspended, or refused to renew a similar registration under this state’s or the other state’s or jurisdiction’s law. An agreement made between a person and this state or another state or jurisdiction not to operate as an appraisal management company may be considered a denial of that person’s registration to operate an appraisal management company in this state or the other state or jurisdiction.    25.3(2)   An owner or controlling person of the applicant has been barred, removed, or prohibited from owning or serving as the controlling person of an appraisal management company, or from serving in any capacity in a financial institution by any state or federal regulatory agency, including but not limited to the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation (FDIC), the Board of Governors of the Federal Reserve System, or the U.S. Department of Housing and Urban Development.     25.3(3)   An owner or controlling person of the applicant is or was the owner or controlling person of another appraisal management company in another state or jurisdiction, if such other state or jurisdiction has canceled, revoked, denied, suspended, or refused to renew the registration or application for registration of such other appraisal management company under this state’s or the other state’s or jurisdiction’s law. An agreement made between a person and this state or another state or jurisdiction not to operate as the owner or controlling person of an appraisal management company may be considered a denial of that person’s application to serve as the owner or controlling person of an appraisal management company in this state or the other state or jurisdiction.     25.3(4)   An owner or controlling person of the applicant has been convicted of forgery, embezzlement, obtaining money under false pretenses, theft, extortion, conspiracy to defraud, tax evasion, or another similar offense, in a court of competent jurisdiction in this state or in any other state, territory, or district of the United States or in any foreign jurisdiction. For the purposes of this subrule, “convicted of” includes a guilty plea, deferred judgment, deferred sentence, or other similar finding of guilt by a court of competent jurisdiction.     25.3(5)   The applicant, or an owner or controlling person of the applicant, has made a false submission of material fact on an application for registration or has been otherwise implicated in the submission of a false application.     25.3(6)   An owner or controlling person of the applicant has demonstrated a lack of moral character in a manner that the administrator reasonably believes will impair the ability of the owner or controlling person to operate an appraisal management company in full compliance with the public interest and state policies described in Iowa Code chapter 543E.     25.3(7)   For any reason listed in Iowa Code section 543E.17(1).    25.3(8)   The applicant has failed to include all of the information required in the application or has failed to pay any fee required under Iowa Code chapter 543E or this chapter.

187—25.4(17A,543E) Renewal of registration.      25.4(1)   To remain registered to operate an appraisal management company in Iowa, a registrant must renew a registration before the date the registration lapses. A registrant who holds a lapsed registration shall not directly or indirectly engage in or attempt to engage in business as an appraisal management company or advertise or hold itself out as engaging in or conducting business as an appraisal management company in Iowa until the administrator has reinstated the lapsed registration or has approved a new registration.    25.4(2)   An application to renew a registration shall be submitted to the administrator, through the NMLS or as otherwise prescribed by the administrator, no earlier than November 1 and no later than December 1 of the year for which the registration is valid. For example, for a registration that will lapse on December 31, 2017, an application for renewal shall be submitted by December 1, 2017. All requested information, including any material change to information contained in the original application, shall be provided to the administrator as directed by the NMLS or as otherwise prescribed by the administrator. Applications for renewal of a registration must be accompanied by a fee as specified in subrule 25.8(5). The administrator may also assess late fees as specified in subrule 25.8(5) for applications submitted after December 1.    25.4(3)   The administrator shall grant an application to renew a registration if:     a.    The administrator receives the application and the appropriate renewal fee by December 1, or the administrator receives the application after December 1 but before January 1 and it is accompanied by the appropriate renewal fee and the appropriate late fee;     b.    The application is fully completed and includes all necessary information; and     c.    The application does not reveal grounds that would be sufficient to deny initial registration, or issue a registration subject to restriction, pursuant to rule 187—25.4(17A,543E).

187—25.5(17A,543E) Reinstatement of lapsed registration.      25.5(1)   The registration of an appraisal management company that has lapsed for failure to satisfy the minimum standards for renewal may be reinstated if the registrant meets the following requirements:    a.    The application for reinstatement is submitted between January 1 and February 28 of the year immediately following the year the registration lapsed.    b.    All minimum requirements for renewal of registration for the year in which the registration lapsed are satisfied prior to submission of the application for reinstatement. The registrant seeking to reinstate a registration must submit all information required to renew a registration pursuant to rule 187—25.4(17A,543E).    c.    The registrant pays a reinstatement fee as specified in subrule 25.8(5), in addition to the renewal fee, and any late charges.    25.5(2)   An appraisal management company whose registration has lapsed and who fails to meet the requirements for reinstatement specified in this rule must apply for a new registration and meet the requirements in effect at that time for a new registration.

187—25.6(17A,543E) Changes in the registrant’s name, location, or ownership.       25.6(1)   A registrant wishing to change the principal location of an appraisal management company shall notify the administrator through the NMLS, or as otherwise prescribed by the administrator, within 15 days of making the change. The notice shall include proof that the registrant has either obtained a new bond or amended the existing mandatory bond to reflect the new location. The registrant shall submit a fee as specified in subrule 25.8(5) in association with the change.     25.6(2)   Registrants must notify the administrator no later than 15 days following a change in name and must submit to the administrator a fee as specified in subrule 25.8(5).    25.6(3)   The prior written approval of the administrator is required whenever a change in ownership of a registrant is proposed. When a change in ownership of a registrant is proposed, the party that will assume ownership of the registrant shall give notice to the administrator through the NMLS, or as otherwise prescribed by the administrator, at least 30 days before the proposed change will take effect. The party that will assume ownership of the registrant shall furnish the administrator through the NMLS, or as otherwise prescribed by the administrator, with the same information required of initial applicants for registration, along with a fee as specified in subrule 25.8(5). The administrator shall approve or deny the request in accordance with the provisions of rule 187—25.3(17A,543E).    25.6(4)   The prior written approval of the administrator is required whenever a change of the designated controlling person of a registrant is proposed. When change of the designated controlling person of a registrant is proposed, the party that will become the designated controlling person of the registrant shall give notice to the administrator through the NMLS, or as otherwise prescribed by the administrator, at least 30 days before the proposed change will take effect. The party that will become the designated controlling person of the registrant shall furnish the administrator through the NMLS, or as otherwise prescribed by the administrator, with the same information required of initial applicants for designation as a controlling person, along with the appropriate fee. The administrator shall approve or deny the request in accordance with the provisions of rule 187—25.3(17A,543E).    25.6(5)   Failure to notify the administrator within the prescribed time as required by this rule may subject the registrant to disciplinary action. However, in the event the death, incapacity, or unexpected resignation of a designated controlling person, or a similar circumstance, makes it impossible for a registrant to provide 30 days’ advance notice, no disciplinary action shall be taken if the party that will become the designated controlling person of the registrant provides the notice described in subrule 25.6(4) promptly and no later than 10 days after learning that a new controlling person must be designated.

187—25.7(17A,543E) Notice of significant events.   A registrant shall notify the administrator immediately and in writing within 15 calendar days of the occurrence of any of the following events.     25.7(1)   The registrant or any of the registrant’s officers, directors, owners, or affiliates file for bankruptcy protection or commence reorganization proceedings.     25.7(2)   A prosecuting authority files criminal charges against the registrant or any of a registrant’s officers, directors, owners, or affiliates.     25.7(3)   Another state or jurisdiction institutes registration denial, cease and desist, suspension or revocation procedures, or other regulatory action against the registrant or any of the registrant’s officers, directors, owners, or affiliates.

187—25.8(17A,543E) Fees.      25.8(1) Examination or investigation fees.   A registrant shall pay an investigation or examination fee as determined by the administrator based on the actual cost of the operation of the finance bureau of the banking division, as described in Iowa Code section 543E.10(1).     25.8(2) Examination or investigation late fees.   A registrant shall pay the administrator the total charge for an examination or investigation within 30 days after the administrator has requested payment. If a registrant fails to pay an examination or investigation fee by the due date, the administrator may assess an additional penalty as identified in subrule 25.8(5) for each day the fee is overdue.     25.8(3) Late fees for failing to respond.   In the process of administering this chapter, the administrator may require a person to provide responses to formal orders, examinations, or complaint inquiries. If a person fails to respond within 30 days of the request, the administrator may assess a fee as specified in subrule 25.8(5).     25.8(4) NMLS system processing fees.   In addition to the fees set forth in this chapter, the applicant or registrant shall pay any fee assessed by the NMLS attributed to the registrant’s record in the NMLS system including but not limited to the initial set-up fee, an annual processing fee, and any fees associated with changing or updating the registrant’s record.     25.8(5) Fees.   Application for registration fee$250Registration fee (initial) (not applicable to preregistration)$750Registration fee (annual renewal)$750Background investigation fee$51Appraisal management company national registry fee (not applicable to preregistration)As determined by the appraisal subcommitteeNMLS feesAs determined by the NMLSFee for late submission of application for renewal$50Fee to reinstate a lapsed registration$250Reissuance or replacement of a lost, destroyed, or stolen registration$25Fee for change of principal location$25Fee for change of name$25Fee for change of ownership$150Fee for change of controlling person$150Fee for late payment of examination or investigation fees5 percent of amount due per day beyond 30 days past dueFee for late response to examination request$10 per day beyond 30 days past dueConversion fee for preregistered persons (applicable only when converting a preregistration to a registration)$150Dishonored check fee$30Examination or investigation fee$100 per hourMailing list fee$30Fee for letter of good standing$25

187—25.9(17A,543E) Registrant records.      25.9(1) General record requirements.   The following requirements apply to all records a registrant is required to keep pursuant to Iowa Code section 543E.13 and this chapter:     a.    The registrant may keep records as a hard copy or in an electronic equivalent.     b.    The registrant shall maintain all books and records in good order and shall produce books and records for the administrator upon request. Failure to produce such books and records within 30 days of the administrator’s request may be grounds for disciplinary action against the registrant.    c.    The obligation to maintain required records continues even after the registrant ceases business operations in Iowa and turns in or surrenders its registration. The owners and directors of the registrant are responsible for ensuring that this requirement is met for the period required under Iowa Code section 543E.13 and this chapter.    d.    The registrant shall keep all required records for at least five years from the date the record was created, unless a longer retention period is required by statute.     25.9(2) Required records.   A registrant operating an appraisal management company shall keep, and be able to retrieve or access from its principal place of business, an appraisal request and assignment log, a true and complete copy of each appraisal performed, a payment log, applications for registration, a dispute resolution policy, and certain corporate records.    a.    Appraisal request and assignment log.A registrant shall maintain a log of all appraisal services requested, including those requests for service that the registrant does not fulfill. A record of the appraiser assigned to each request for appraisal services accepted by the registrant shall also be kept. The record shall include a description of the assignment, the certification or registration number of the assigned appraiser, the certification possessed by the assigned appraiser, and the expiration date of the appraiser’s certification.     b.    Appraisal files.For each appraisal service assigned by a registrant to an appraiser, the registrant shall keep a record of the award or engagement letter giving the appraisal assignment to the appraiser; the assigned appraiser’s acceptance of the assignment; all material communications between the registrant, the assigned appraiser, and the service requestor regarding a consumer credit transaction secured by the principal dwelling of an Iowa consumer, or the securitization thereof; and the appraisal report created by the assigned appraiser.    c.    Payment log.A record shall be kept of all payments made by a registrant in association with the provision of appraisal services and shall include the date the payment was made, the amount paid, the appraisal services for which payment was made, and the date on which the appraiser provided the results of the completed appraisal service to the registrant.     d.    Dispute resolution policy.A registrant shall maintain a copy of a dispute resolution policy for appraisers who request a review of a decision made by the registrant. The dispute resolution policy shall provide for a written response to the appraiser’s request for review, a written statement of the outcome of the dispute resolution process, and a copy of all relevant documents to the appraiser upon request. The dispute resolution policy shall provide for external review of the decision in question or internal review of the decision in question by an officer or employee of a registrant who holds a higher position than the individual who made the decision in question.     e.    Corporate records.A registrant shall maintain lists of all owners, directors, officers, and employees, as well as the minutes from meetings of the registrant’s board of directors if the registrant’s corporate structure includes a board of directors.    25.9(3) General business records.  In addition to the required records, a registrant must keep the following general business records for at least five years from the date the record was created:    a.    All checkbooks, check registers, bank statements, deposit slips, withdrawal slips, and canceled checks (or copies thereof) relating to the registrant’s operation of an appraisal management company.     b.    Complete records (including invoices and supporting documentation) for all expenses and fees paid in connection with each appraisal, including a record of the date and amount of all such payments actually made in connection with each appraisal.     c.    Copies of all federal tax withholding forms, reports of income for federal taxation, and evidence of payments to all employees, independent contractors, and others compensated by a registrant in connection with the operation of an appraisal management company.     d.    All correspondence and other records relating to the maintenance of any surety bond required by Iowa Code chapter 543E.    e.    Copies of all reports of audits, examinations, inspections, reviews, investigations, or other similar functions performed by any third party, including but not limited to the administrator or any other regulatory or supervisory authority.     25.9(4) Disposal of records.  If a registrant or former registrant disposes of records at the end of the retention period, the registrant or former registrant shall dispose of the records in a reasonable manner that safeguards any identification information, as defined in Iowa Code section 715A.8(1)“a.” The owners and directors of registrants and former registrants are responsible for ensuring that this requirement is met.

187—25.10(17A,543E) Examinations, investigations, and complaints.      25.10(1)   The administrator may, at any time and as often as the administrator deems necessary, examine a registrant’s books, accounts, records, and files and investigate a registrant to assess potential violations of applicable appraisal-related laws, regulations, rules, or orders.    25.10(2)   The administrator may investigate complaints about, or alleged violations committed by, any registrant.    25.10(3)   The following shall constitute a complaint or alleged violation:    a.    A written complaint received from a consumer, member of the public, employee, business affiliate, or other governmental agency.    b.    Notice to the administrator from any source that the registrant, or any owner or controlling person thereof, has been the subject of disciplinary proceedings in another jurisdiction.    c.    Notice to the administrator from any source that any owner or controlling person of the registrant has been convicted of forgery, embezzlement, obtaining money under false pretenses, extortion, conspiracy to defraud, or other similar offense, in a court of competent jurisdiction in this state or in any other state, territory, or district of the United States, or in any foreign jurisdiction.

187—25.11(17A,543E) Disciplinary action.      25.11(1)   The administrator has authority pursuant to Iowa Code chapters 543E and 17A to impose discipline for violations of Iowa Code chapter 543E and this chapter.    25.11(2)   Grounds for discipline. The administrator may impose any of the disciplinary sanctions set out in Iowa Code section 543E.17(1) when the administrator finds any of the following:    a.    The registrant, or an owner or controlling person thereof, has violated a provision of Iowa Code chapter 543E or this chapter.    b.    The registrant, or an owner or controlling person thereof, fails to fully cooperate with an examination or investigation, including failing to respond to an inquiry from the administrator within 30 calendar days of the date the administrator mails a written communication directed to the registrant’s last-known address on file with the administrator.    c.    The registrant, or an owner or controlling person thereof, has engaged in any conduct that subverts or attempts to subvert an examination or investigation by the administrator.    d.    The registrant continues to operate an appraisal management company without an active and current registration.    e.    The registrant fails to timely notify the administrator of the occurrence of any of the significant events set forth in rule 187—25.7(17A,543E).     f.    The registrant fails to notify the administrator of a change in ownership, controlling person, name, or principal place of business.     g.    Another state or jurisdiction has denied, suspended, revoked, or refused to renew the registrant’s registration or authorization to operate an appraisal management company under the other state’s or jurisdiction’s law.    h.    The registrant fails to create and maintain complete and accurate records as required by state or federal law, regulation, or rule.     i.    The registrant, or an owner or controlling person thereof, has violated an order of the administrator.    j.    The registrant has abandoned its place of business for 60 or more days.    k.    The registrant fails to pay any fee required by Iowa Code chapter 543E or this chapter or to maintain a bond required by Iowa Code chapter 543E.    l.    A fact or condition exists which, had it existed at the time of the original application for registration, would have warranted the administrator to refuse to issue the original registration.     25.11(3)   A registrant may surrender a registration by delivering to the administrator a written notice of surrender.

187—25.12(17A,543E) Appraisal management company national registry maintained by the appraisal subcommittee.   The administrator shall transmit to the appraisal subcommittee information and fees as necessary for inclusion on the appraisal management company national registry.     25.12(1) Registered appraisal management companies.   The administrator shall transmit to the appraisal subcommittee all information regarding registered appraisal management companies required for inclusion on the appraisal management company national registry, including but not limited to a roster of appraisal management companies registered in this state and records relating to any disciplinary action taken against a registrant.     25.12(2) Federally regulated appraisal management companies.   The administrator shall collect from a federally regulated appraisal management company all fees required for registration on the appraisal management company national registry maintained by the appraisal subcommittee. A federally regulated appraisal management company shall also pay all fees associated with the administration of this rule, including but not limited to fees required by the NMLS. The administrator shall collect from a federally regulated appraisal management company the following information necessary for the fulfillment of this obligation: the name, address, and telephone number of the company; the national registry identification number and tax identification number of the company; the start date of the company’s registration on the appraisal management company national registry; the name of and contact information for a contact person for the company; and any other information as required by the administrator.

187—25.13(17A,543E) Preregistration.       25.13(1)   A person who is not required to register as an appraisal management company because its appraiser panel does not meet or exceed the size requirements specified in Iowa Code section 543E.3(2) may apply to the administrator for preregistration as an appraisal management company. If the administrator approves the application, the applicant will receive a preliminary notice indicating that the administrator intends to approve the applicant for registration as an appraisal management company, based on the information submitted, as soon as the appraiser panel that the applicant oversees meets or exceeds the statutory size requirements. The administrator’s preliminary intent to approve registration will remain subject to change in the event that the administrator receives additional information indicating that registration should be denied.     25.13(2)   An applicant seeking preregistration as an appraisal management company must follow the application procedures prescribed in rule 187—25.2(17A,543E), including providing all required information. The applicant shall indicate that the applicant is applying for preregistration as an appraisal management company. The applicant shall submit the application fee required by rule 187—25.2(17A,543E), but an applicant under this provision need not submit the initial registration fee or the fee required by the appraisal management company national registry. The administrator shall approve or deny the application for preregistration based on the criteria enumerated in rule 187—25.3(17A,543E). Even if the administrator approves the application for preregistration, the applicant will not be registered on the appraisal management company national registry.     25.13(3)   A person who has received preregistration as an appraisal management company must apply for registration as an appraisal management company at least 30 days before the appraisal panel that the preregistered person oversees meets or exceeds the size requirements specified in Iowa Code section 543E.3(2). The applicant shall submit a conversion application to the administrator, through the NMLS or as otherwise prescribed by the administrator, specifying the new size of the applicant’s appraiser panel as required by subrule 25.2(2), updating all required information as necessary, and including any other information as prescribed by the administrator. The applicant shall also submit a conversion fee, the initial registration fee, and the fee required by the appraisal management company national registry as specified in subrule 25.8(5).     25.13(4)   The administrator shall approve the application for registration unless additional information submitted by the applicant, or otherwise received by the administrator, indicates that the applicant is ineligible for registration based on the criteria enumerated in rule 187—25.3(17A,543E). After the administrator approves registration, the applicant will be registered on the appraisal management company national registry and must comply with the provisions of Iowa Code chapter 543E and this chapter.        These rules are intended to implement Iowa Code chapters 17A and 543E.
    [Filed Emergency After Notice 11/23/16, effective 1/1/17][Published 12/21/16]Editor’s Note: For replacement pages for IAC, see IAC Supplement 12/21/16.
ARC 2870CDental Board[650]Adopted and Filed

    Pursuant to the authority of Iowa Code sections 147.34 and 153.21, the Dental Board amends Chapter 11, “Licensure to Practice Dentistry or Dental Hygiene,” Iowa Administrative Code.     These amendments allow applicants applying for licensure by examination to take the same nationally recognized regional examinations currently accepted by applicants who apply for licensure by credentials; require applicants who have held licenses in other states for one year or longer to apply for licensure by credentials; clarify the practice requirements for applicants applying for licensure by credentials; remove special transitional period language that is no longer applicable; remove references to the Healthcare Integrity and Protection Data Bank; clarify both the name of the examination and the agency administering the examination; allow jurisprudence examinations to be administered by other entities; and require applicants to attain a grade of 75 percent on the jurisprudence examination, the national dental examination, and the national hygiene examination.     Notice of Intended Action was published in the Iowa Administrative Bulletin on August 31, 2016, as ARC 2701C. A public hearing was held on September 21, 2016, at 2 p.m. at the office of the Dental Board. One attendee was present, Emily Boge, Dental Administrative Chair from Hawkeye Community College. Ms. Boge stated that she was supportive of the amendments. Written comments were received from the University of Iowa College of Dentistry and Dental Clinics, the Iowa Dental Association, the Iowa Dental Hygiene Association and Dr. Howard Cohen. All entities expressed support for the amendments.     These amendments differ from those originally published under Notice as they now clarify the name of the agency administering the examination and that applicants must attain a minimum grade of 75 percent on the jurisprudence examination, the national dental examination, and the national hygiene examination.     The Board reviewed and discussed the amendments during its October 13, 2016, open-session meeting and allowed additional comments from the public. These amendments were approved by the Board on October 13, 2016.    These amendments are subject to waiver or variance pursuant to 650—Chapter 7.    After analysis and review of this rule making, there is no impact on jobs.     These amendments are intended to implement Iowa Code chapters 147 and 153.    These amendments will become effective January 25, 2017.    The following amendments are adopted.

    ITEM 1.    Amend subrule 11.2(1) as follows:    11.2(1)   Applications for licensureby examination to practice dentistry in this state shall be made on the form provided by the board and must be complete and includecompletely answered, including required credentials and documents.An applicant who has held a dental license issued in another state for one year or longer must apply for licensure by credentials pursuant to rule 650—11.3(153).

    ITEM 2.    Rescind paragraph 11.2(2)"c".

    ITEM 3.    Reletter paragraphs 11.2(2)"d" to 11.2(2)"j" as 11.2(2)"c" to 11.2(2)"i".

    ITEM 4.    Amend relettered paragraph 11.2(2)"c" as follows:    c.    Documentation of passage of national dental examination.Evidence of successful completion ofattaining a grade of at least 75 percent onthe examination administered by the Joint Commission on National Dental Examinations. Any dentist who has lawfully practiced dentistry in another state or territory for five years may be exempted from presenting this evidence.

    ITEM 5.    Amend relettered paragraph 11.2(2)"d" as follows:    d.    Documentation of passage of a regional clinical examination.    (1)   Successful passage of CRDTSa regional clinical examination within the previous five-year period with a grade of at least 75 percent. Evidence of having successfully completed in the last five years the examination administered by the Central Regional Dental Testing Service, Inc. (CRDTS).    (2)   Special transition period for dentists passing WREB or ADEX examination prior to September 1, 2011. An applicant who has successfully taken and passed the WREB or ADEX examination within the five years prior to September 1, 2011, may apply for licensure by examination by submitting evidence of successful completion of the WREB or ADEX examination.The following regional examinations are approved by the board for purposes of licensure by examination: the Central Regional Dental Testing Service, Inc. examination as administered by the Central Regional Dental Testing Service, Inc. (CRDTS), the Western Regional Examining Board examination as administered by the Western Regional Examining Board (WREB), the Southern Regional Testing Agency, Inc. examination as administered by the Southern Regional Testing Agency, Inc. (SRTA), and the American Board of Dental Examiners, Inc. examination as administered by the Commission on Dental Competency Assessments (CDCA) and the Council of Interstate Testing Agencies, Inc. (CITA).

    ITEM 6.    Amend relettered paragraph 11.2(2)"e" as follows:    e.    Explanation of any legal or administrative actions.A statement disclosing and explaining any disciplinary actions, investigations, complaints, malpractice claims, judgments, settlements, or criminal chargesincluding the results of a self-query of the National Practitioners Data Bank (NPDB) and the Healthcare Integrity and Protection Data Bank (HIPDB).

    ITEM 7.    Amend relettered paragraph 11.2(2)"g" as follows:    g.    Documentation of passage of jurisprudence examination.Evidence of successful completion of thea board-approved jurisprudence examination administered by the Iowa dental boardwith a grade of at least 75 percent.

    ITEM 8.    Amend paragraph 11.3(2)"b" as follows:    b.    Evidence of successful completion ofattaining a grade of at least 75 percent on the examination of the Joint Commission on National Dental Examinations or evidence of having passedattaining a grade of at least 75 percent on a written examination during the last ten years that is comparable to the examination given by the Joint Commission on National Dental Examinations. Any dentist who has lawfully practiced dentistry in another state or territory for five years may be exempted from presenting this evidence.

    ITEM 9.    Amend subparagraph 11.3(2)"e" as follows:    (1)   Passed an examination approved by the board in accordance with Iowa Code section 147.34(1) and administered by a regional or national testing service. The clinical examinations approved by the board are specified in 650—subrule 12.1(5)Has less than three consecutive years of practice immediately prior to the filing of the application and evidence of attaining a grade of at least 75 percent on a regional clinical examination within the previous five-year period. The following regional examinations are approved by the board for purposes of licensure by credentials: the Central Regional Dental Testing Service, Inc. examination as administered by the Central Regional Dental Testing Service, Inc. (CRDTS), the Western Regional Examining Board examination as administered by the Western Regional Examining Board (WREB), the Southern Regional Testing Agency, Inc. examination as administered by the Southern Regional Testing Agency, Inc. (SRTA), and the American Board of Dental Examiners, Inc. examination as administered by the Commission on Dental Competency Assessments (CDCA) and the Council of Interstate Testing Agencies, Inc. (CITA); or

    ITEM 10.    Amend paragraph 11.3(2)"g" as follows:    g.    A statement disclosing and explaining any disciplinary actions, investigations, malpractice claims, complaints, judgments, settlements, or criminal charges, including the results of a self-query of the National PractitionersPractitioner Data Bank (NPDB) and the Healthcare Integrity and Protection Data Bank (HIPDB).

    ITEM 11.    Amend paragraph 11.3(2)"j" as follows:    j.    Evidence of successful completion of thea board-approved jurisprudence examination administered by the Iowa dental boardwith a grade of at least 75 percent.

    ITEM 12.    Amend subrule 11.5(1) as follows:    11.5(1)   Applications for licensure to practice dental hygiene in this state shall be made on the form provided by the dental hygiene committee and must be completely answered, including required credentials and documents.An applicant who has held a dental hygiene license issued in another state for one year or longer must apply for licensure by credentials pursuant to rule 650—11.6(153).

    ITEM 13.    Rescind paragraph 11.5(2)"c".

    ITEM 14.    Reletter paragraphs 11.5(2)"d" to 11.5(2)"j" as 11.5(2)"c" to 11.5(2)"i".

    ITEM 15.    Amend relettered paragraph 11.5(2)"c" as follows:    c.    Documentation of completionpassage of nationaldental hygiene examination.Evidence of successful completion ofattaining a grade of at least 75 percent onthe examination administered by the Joint Commission on National Dental Examinations.

    ITEM 16.    Amend relettered paragraph 11.5(2)"d" as follows:    d.    PassageDocumentation of passage ofa regional clinical examination.    (1)   Successful passage of CRDTSa regional clinical examination within the previous five-year period with a grade of at least 75 percent. Evidence of having successfully completed in the last five years the examination administered by the Central Regional Dental Testing Service, Inc. (CRDTS).    (2)   Special transition period for dental hygienists passing WREB examination prior to September 1, 2011. An applicant who has successfully taken and passed the WREB examination within the five years prior to September 1, 2011, may apply for licensure by examination by submitting evidence of successful completion of the WREB examination.The following regional examinations are approved by the board for purposes of licensure by examination: the Central Regional Dental Testing Service, Inc. examination as administered by the Central Regional Dental Testing Service, Inc. (CRDTS), the Western Regional Examining Board examination as administered by the Western Regional Examining Board (WREB), the Southern Regional Testing Agency, Inc. examination as administered by the Southern Regional Testing Agency, Inc. (SRTA), and the American Board of Dental Examiners, Inc. examination as administered by the Commission on Dental Competency Assessments (CDCA) and the Council of Interstate Testing Agencies, Inc. (CITA).

    ITEM 17.    Amend relettered paragraph 11.5(2)"f" as follows:    f.    Documentation of passage of jurisprudence examination.Evidence of successful completion of thea board-approved jurisprudence examination administered by the dental hygiene committeewith a grade of at least 75 percent.

    ITEM 18.    Amend relettered paragraph 11.5(2)"h" as follows:    h.    Explanation of any legal or administrative actions.A statement disclosing and explaining any disciplinary actions, investigations, complaints, malpractice claims, judgments, settlements, or criminal charges, including the results of a self-query of the National Practitioners Data Bank (NPDB) and the Healthcare Integrity and Protection Data Bank (HIPDB).

    ITEM 19.    Amend paragraph 11.6(2)"b" as follows:    b.    Evidence of successful completion of attaining a grade of at least 75 percent on the examination of the Joint Commission on National Dental Examinations or evidence of having passedattaining a grade of at least 75 percent on a written examination that is comparable to the examination given by the Joint Commission on National Dental Examinations.Any dental hygienist who has lawfully practiced dental hygiene in another state or territory for five or more years may be exempted from presenting this evidence.

    ITEM 20.    Amend subparagraph 11.6(2)"e" as follows:    (1)   Passed an examination approved by the board in accordance with Iowa Code section 147.34(1) and administered by a regional or national testing service. The clinical examinations approved by the board are specified in 650—subrule 12.3(5).Has less than three consecutive years of practice immediately prior to the filing of the application and evidence of attaining a grade of at least 75 percent on a regional clinical examination within the previous five-year period. The following regional examinations are approved by the board for purposes of licensure by examination: the Central Regional Dental Testing Service, Inc. examination as administered by the Central Regional Dental Testing Service, Inc. (CRDTS), the Western Regional Examining Board examination as administered by the Western Regional Examining Board (WREB), the Southern Regional Testing Agency, Inc. examination as administered by the Southern Regional Testing Agency, Inc. (SRTA), and the American Board of Dental Examiners, Inc. examination as administered by the Commission on Dental Competency Assessments (CDCA) and the Council of Interstate Testing Agencies, Inc. (CITA); or

    ITEM 21.    Amend paragraph 11.6(2)"g" as follows:    g.    A statement disclosing and explaining any disciplinary actions, investigations, complaints, malpractice claims, judgments, settlements, or criminal charges, including the results of a self-query of the National PractitionersPractitioner Data Bank (NPDB) and the Healthcare Integrity and Protection Data Bank (HIPDB).

    ITEM 22.    Amend paragraph 11.6(2)"j" as follows:    j.    Successful completion of thea board-approved jurisprudence examination administered by the dental hygiene committeewith a grade of at least 75 percent.    [Filed 11/22/16, effective 1/25/17][Published 12/21/16]Editor’s Note: For replacement pages for IAC, see IAC Supplement 12/21/16.
ARC 2871CDental Board[650]Adopted and Filed

    Pursuant to the authority of Iowa Code sections 147.34 and 153.21, the Dental Board amends Chapter 12, “Dental and Dental Hygiene Examinations,” Iowa Administrative Code.     These amendments allow applicants applying for licensure by examination to take the same nationally recognized regional examinations currently accepted for applicants who apply for licensure by credentials; require applicants to take all parts of the examination offered by each respective testing agency; require applicants to follow the policies and procedures of each respective testing agency; require applicants to attain a grade of not less than 75 percent on each clinical portion and on the written portion of the examinations; and strike language that is outdated.    Notice of Intended Action was published in the Iowa Administrative Bulletin on August 31, 2016, as ARC 2700C. A public hearing was held on September 21, 2016, at 2 p.m. at the office of the Dental Board. One attendee was present, Emily Boge, Dental Administrative Chair from Hawkeye Community College. Ms. Boge stated that she was supportive of the amendments. Written comments were received from the University of Iowa College of Dentistry and Dental Clinics, the Iowa Dental Association, the Iowa Dental Hygiene Association and Dr. Howard Cohen. All entities expressed support for the amendments.     These amendments differ from those originally published under Notice as they now clarify that applicants must attain a minimum grade of 75 percent on the examinations.     The Board reviewed and discussed the amendments during its October 13, 2016, open-session meeting and allowed additional comments from the public. These amendments were approved by the Board on October 13, 2016.    These amendments are subject to waiver or variance pursuant to 650—Chapter 7.     After analysis and review of this rule making, there is no impact on jobs.     These amendments are intended to implement Iowa Code section 147.36.    These amendments will become effective on January 25, 2017.    The following amendments are adopted.

    ITEM 1.    Amend rule 650—12.1(147,153) as follows:

650—12.1(147,153) Clinical examination procedure for dentistry.      12.1(1) Completion of regional clinical examination required.      a.    CRDTS accepted for licensure by examination.To meet the requirements for dental licensure by examination, applicants shall complete the examination administered by the Central Regional Dental Testing Service, Inc. (CRDTS).    b.    Special transition period for dentists passing WREB or ADEX examination prior to September 1, 2011.An applicant who has successfully passed the WREB or ADEX examination prior to September 1, 2011, may apply for licensure by examination.    12.(2) 12.1(1) Compliance withregional clinical examination testing requirements and procedures.  a.    CRDTS. Examinees shall meet the requirements for testing and follow the procedures established by the Central Regional Dental Testing Service, Inceach respective testing agency.Examinees must take all parts offered by the respective testing agency.    b.    Special transition period for dentists passing WREB or ADEX examination prior to September 1, 2011.Examinees who have completed the WREB or ADEX examination prior to September 1, 2011, shall meet the requirements for testing and follow the procedures established by WREB or ADEX.    12.(3) 12.1(2) Scoring requirements.  The examinee must attain a grade of not less than 75 percent on each clinical portion of the examination and on the written portion of the examination.    a.    Prior to April 1, 1995, the examinee must attain an average grade of not less than 70 percent on each clinical portion of the examination and 70 percent on the written portion of the examination.    b.    Between April 1, 1995, and December 31, 2000, the examinee must attain an average grade of not less than 75 percent on each clinical portion of the examination and 75 percent on the written portion of the examination.    c.    Between January 1, 2001, and June 22, 2011, the examinee must attain a comprehensive score that meets the standard for passing established by ADEX, CRDTS, or WREB.    d.    Post-June 22, 2011, and special transition period.    (1)   Effective June 22, 2011, the examinee must attain a comprehensive score that meets the standard for passing established by CRDTS.    (2)   Special transition period for dentists passing WREB or ADEX. Examinees who successfully complete the WREB or ADEX examination by September 1, 2011, must attain a comprehensive score that meets the standard for passing established by WREB or ADEX.    12.(4) 12.1(3) Compliance with performance clinical operations requirements.  a.    Each examinee shall be required to perform such clinical operations as may be required by the Central Regional Dental Testing Service, Inc. each respective testing agency, for the purpose of sufficiently evaluating and testing the fitness of the examinee to practice dentistry.    b.    Special transition period for dentists passing WREB or ADEX. Examinees who successfully complete the WREB or ADEX examination by September 1, 2011, shall be required to perform such clinical operations as may be required by WREB or ADEX for the purpose of sufficiently evaluating and testing the fitness of the examinee to practice dentistry.    12.1(5) Clinical examinations accepted for purposes of licensure by credentials.  The board is authorized by 2011 Iowa Code Supplement section 153.21 to establish the regional or national testing service examinations that will be accepted for purposes of licensure by credentials. The following regional examinations are approved by the board for purposes of application for licensure by credentials submitted pursuant to 650—Chapter 11: Central Regional Dental Testing Service, Inc. (CRDTS), Western Regional Examining Board, Inc. (WREB), Southern Regional Testing Agency (SRTA), North East Regional Board of Dental Examiners (NERB), and Council of Interstate Testing Agencies (CITA).

    ITEM 2.    Amend subrule 12.2(1) as follows:    12.2(1) Method of counting failures.  a.    Integrated format. For the purposes of counting examination failures, the board shall utilize the policies adopted by CRDTSeach respective testing agency. A dental examinee who has not passed all five parts of the integrated examination format by June 30 following graduation from dental school shall have one examination failure recorded. The dental examinee must then retake all five parts of the examination in the traditional format.    b.    Traditional format. For the purposes of counting examination failures, the board shall utilize the policies adopted by CRDTS. A dental examinee who fails one or more parts of the examination shall have one examination failure recorded. A dental examinee shall be required to retake only those parts of the examination that the examinee failed. A dental examinee who has not passed all five parts of the examination within the time frame specified by CRDTS shall be required to retake the entire examination.    c.    A dental examinee who has two examination failures in the traditional format will be required to complete remedial education requirements set forth in subrule 12.2(2).

    ITEM 3.    Amend paragraph 12.2(2)"b" as follows:    b.    A dental examinee shall be required to retake only those parts of the examination that the examinee failed. However, a dental examinee who has not passed all five parts of the examination within the time frame specified by CRDTS shall be required to retake the entire examination.The dental examinee shall refer to the policies of each respective testing agency to determine applicable time frames.

    ITEM 4.    Amend paragraph 12.2(3)"b" as follows:    b.    At the fourth examination, the dental examinee shall be required to retake only those parts of the examination that the examinee failed. However, a dental examinee who has not passed all five parts of the examination within the time frame specified by CRDTS shall be required to retake the entire examination.The dental examinee shall refer to the policies of each respective testing agency to determine applicable time frames.

    ITEM 5.    Amend subrule 12.2(5) as follows:    12.2(5) Failures of other examinations.  If a dental examinee applies for the Central Regional Dental Testing Service, Inc.,an examination after having failed any other state or regional examinationexaminations, the failure shall be considered a CRDTS failurecounted for the purposes of retakes.

    ITEM 6.    Amend rule 650—12.3(147,153) as follows:

650—12.3(147,153) Clinical examination procedure for dental hygiene.      12.3(1) Completion of regional clinical examination required.      a.    CRDTS accepted for licensure by examination.To meet the requirements for dental hygiene licensure by examination, applicants shall complete the examination administered by the Central Regional Dental Testing Service, Inc.    b.    Special transition period for dentists passing WREB examination prior to September 1, 2011.An applicant who has successfully passed the WREB examination prior to September 1, 2011, may apply for licensure by examination.    12.(2) 12.3(1) Compliance withregional clinical examination testing requirements and procedures.  a.    CRDTS. Examinees shall meet the requirements for testing and follow the procedures established by the Central Regional Dental Testing Service, Inceach respective testing agency.Examinees must take all parts offered by the respective testing agency.    b.    Special transition period for dentists passing WREB examination prior to September 1, 2011.Examinees who successfully complete the WREB examination prior to September 1, 2011, shall meet the requirements for testing and follow the procedures established by WREB.    12.(3) 12.3(2) Scoring requirements.  The examinee must attain a grade of not less than 75 percent on each clinical portion of the examination and on the written portion of the examination.    a.    Prior to December 31, 2003, the examinee must attain an average grade of 70 percent on the examination.     b.    Between January 1, 2004, and June 22, 2011, the examinee must attain a comprehensive score that meets the standard for passing established by CRDTS or WREB.    c.    Post-June 22, 2011, and special transition period.    (1)   Effective June 22, 2011, the examinee must attain a comprehensive score that meets the standard for passing established by CRDTS.     (2)   Special transition period for dental hygienists passing WREB. Examinees who successfully complete the WREB examination by September 1, 2011, must attain a comprehensive score that meets the standard for passing established by WREB.    12.(4) 12.3(3) Practical demonstrations.  Each examinee shall be required to perform such practical demonstrations as may be required by the Central Regional Dental Testing Service, Inc.,each respective testing agency for the purpose of sufficiently evaluating and testing the fitness of the examinee to practice dental hygiene.    12.3(5) Clinical examinations accepted for purposes of licensure by credentials.  The board is authorized by 2011 Iowa Code Supplement section 153.21 to establish the regional or national testing service examinations that will be accepted for purposes of licensure by credentials. The following regional examinations are approved by the board for purposes of application for licensure by credentials submitted pursuant to 650—Chapter 11: Central Regional Dental Testing Service, Inc. (CRDTS), Western Regional Examining Board, Inc. (WREB), Southern Regional Testing Agency (SRTA), North East Regional Board of Dental Examiners (NERB), and Council of Interstate Testing Agencies (CITA).

    ITEM 7.    Amend paragraph 12.4(1)"a" as follows:    a.    For the purposes of counting examination failures, the board shall utilize the policies adopted by CRDTSeach respective testing agency.

    ITEM 8.    Rescind paragraph 12.4(1)"b".

    ITEM 9.    Reletter paragraph 12.4(1)"c" as 12.4(1)"b".

    ITEM 10.    Amend subrule 12.4(5) as follows:    12.4(5) Failures of other examinations.  If a dental hygiene examinee applies for the Central Regional Dental Testing Service, Inc. anexamination after having failed any other state or regional examinationexaminations, the failure shall be considered a CRDTS failurecounted for the purposes of retakes.    [Filed 11/22/16, effective 1/25/17][Published 12/21/16]Editor’s Note: For replacement pages for IAC, see IAC Supplement 12/21/16.
ARC 2872CInsurance Division[191]Adopted and Filed

    Pursuant to the authority of Iowa Code section 502.605, the Insurance Division (the Division) hereby amends Chapter 50, “Regulation of Securities Offerings and Those Who Engage in the Securities Business,” Iowa Administrative Code.    Iowa Code chapter 502, among other things, prescribes the terms and conditions under which issuers make securities offerings and under which broker-dealers and investment advisers operate. These amendments to Chapter 50, through new rule 191—50.47(502), require every investment adviser registered in Iowa to create and implement written procedures to address business continuity and succession planning related to possible instances of disruptions or cessation of business activities. Adopted rule 191—50.47(502) is based on the North American Securities Administrators Association, Inc.’s “Model Rule on Business Continuity and Succession Planning” (Model Rule 203(a)-1A, Appendix A to the NASAA Guidance on Business Continuity and Succession Planning for State-Registered Investment Advisers). These amendments to Chapter 50 will go into effect January 25, 2017, and investment advisers must be in compliance with rule 191—50.47(502) by July 1, 2017. The amendments also include minor language corrections to other rules in Chapter 50.    Notice of Intended Action was published in the Iowa Administrative Bulletin on October 26, 2016, as ARC 2787C. A public hearing was held on November 15, 2016, and written comments were accepted through that date. One written comment was received.    The written comment letter suggested allowing investment advisers in compliance with federal requirements regarding business continuity and succession planning to be deemed in compliance with Iowa requirements. The Division has made that change by adding subrule 50.47(3). For consistency, the word “transition” in the phrase “business continuity and transition plan” was changed to “succession” in 50.47(3). Except for these changes, these amendments are identical to those published under Notice.    These amendments are subject to waiver consistent with the waiver provisions provided at 191—Chapter 4.    These rules will impose no fiscal impact on the State.    After analysis and review of this rule making, no impact on jobs has been found.    These amendments are intended to implement Iowa Code chapter 502.    These amendments shall become effective January 25, 2017.    The following amendments are adopted.

    ITEM 1.    Amend subrule 50.2(1), introductory paragraph, as follows:    50.2(1)   The administrator may assess the broker-dealer or investment adviser for reasonable charges of travel, lodging, and other expenses incurred byIowa insurance division staff or independent persons conducting an audit or inspection and directly attributable to an audit or inspection made pursuant to Iowa Code section 502.411(4). The assessment of costs of meals, lodging, transportation, and other actual and necessary travel expenses, if any, incurred by persons conducting an audit or inspection shall be determined in accordance with one of the following, as agreed by the administrator and the persons conducting an audit or inspection:

    ITEM 2.    Amend subrule 50.3(3) as follows:    50.3(3)   All no-action determinations shall be based upon the representations made by the requesting party in the letter and information filed, since any different facts or conditions might require a different conclusion. The no-action letter shall express the division’sadministrator’s position on enforcement action only and shall not purport to express any legal conclusion on the questions presented. No determination shall take a position on whether or not any disclosure materials satisfactorily comply with the antifraud and civil liability sections of the Act.

    ITEM 3.    Adopt the following new rule 191—50.47(502):

191—50.47(502) Business continuity and succession planning for investment advisers.      50.47(1)   On and after July 1, 2017, every investment adviser registered in Iowa shall establish, implement, and maintain a written business continuity and succession plan. The business continuity and succession plan shall be created and implemented in a manner consistent with the NASAA Guidance on Business Continuity and Succession Planning for State-Registered Investment Advisers, which is available on the Iowa insurance division’s Web site, www.iid.iowa.gov. In developing the procedures for the business continuity and succession plan, the investment adviser shall consider, among other things, the size of the firm, the types of services provided and the number of locations of the investment adviser. The business continuity and succession plan shall provide for, at a minimum, all of the following:    a.    The protection, backup, and recovery of books and records;    b.    Alternate means of communications with customers, key personnel, employees, vendors, service providers (including third-party custodians of securities) and regulators, that will allow the communication of certain events, including, but not limited to, providing notice of a significant business interruption or the death or unavailability of key personnel or other disruptions or cessation of business activities;    c.    Office relocation in the event of temporary or permanent loss of a principal place of business;     d.    Assignment of duties to qualified responsible persons in the event of the death or unavailability of key personnel; and    e.    Other means of minimizing service disruptions and client harm that could result from a sudden significant business interruption.    50.47(2)   Every investment adviser registered in Iowa shall include a copy of the investment adviser’s written business continuity and succession plan with the first registration renewal required by Iowa Code section 502.402 that the investment adviser files on and after July 1, 2017. The administrator shall review an investment adviser’s written business continuity and succession plan to determine whether it is consistent with the NASAA Guidance on Business Continuity and Succession Planning for State-Registered Investment Advisers and whether it takes into account the considerations listed in subrule 50.47(1). The administrator may request the investment adviser to modify the filed business continuity and succession plan according to the administrator’s suggestions. After the initial filing, the investment adviser shall submit to the administrator any substantive amendment to the business continuity and succession plan with the registration renewal following the amendment. The administrator may request from the investment adviser at any time information regarding the business continuity and succession plan, including but not limited to evidence that it has been implemented and maintained.    50.47(3)   An investment adviser registered in Iowa shall be deemed in compliance with this rule if the investment adviser can demonstrate compliance with SEC rules or other law related to the investment adviser’s adoption and implementation of a written business continuity and succession plan.        This rule is intended to implement Iowa Code chapter 502.

    ITEM 4.    Amend paragraph 50.52(2)"e" as follows:    e.    The filing of an application for hearing with the district court will stay the proceedings of the divisionadministrator.

    ITEM 5.    Amend paragraph 50.53(2)"e" as follows:    e.    The filing of an application for hearing with the district court will stay the proceedings of the divisionadministrator.

    ITEM 6.    Amend paragraph 50.54(2)"e" as follows:    e.    The filing of an application for hearing with the district court will stay the proceedings of the divisionadministrator.

    ITEM 7.    Amend rule 191—50.81(502) as follows:

191—50.81(502) Notice filings for Rule 506 offerings.  Beginning January 1, 2016, anAn issuer offering a security that is a covered security pursuant to Section 18(b)(4)(D)18(b)(4)(E) of the Securities Act of 1933 shall submit no later than 15 days after the first sale of such federal covered security in Iowa an electronic filing and fees through www.efdnasaa.org, under “filers and issuers.”       This rule is intended to implement Iowa Code section 502.302(3).
    [Filed 11/30/16, effective 1/25/17][Published 12/21/16]Editor’s Note: For replacement pages for IAC, see IAC Supplement 12/21/16.
ARC 2873CInsurance Division[191]Adopted and Filed

    Pursuant to the authority of Iowa Code section 505.8, the Insurance Division (the Division) hereby amends Chapter 90, “Financial and Health Information Regulation,” Iowa Administrative Code.    The purpose of this amendment is to clarify the effect on Iowa administrative law of certain changes made in 2015 to the federal Gramm-Leach-Bliley Act (GLBA) (Pub. L. No. 106-102, 113 Stat. 1338).    On December 4, 2015, the federal Fixing America’s Surface Transportation (FAST) Act (Pub. L. No. 114-94) was enacted into law and was effective immediately. The FAST Act included amendments to the GLBA to eliminate the GLBA requirement for financial institutions to provide annual privacy notices about the treatment of nonpublic personal information provided certain conditions are met. The amendments to the GLBA eliminated a duplicative and costly notification requirement. Financial institutions shall continue to provide initial privacy notices as required under the GLBA.    The adopted subrule 90.4(4) clarifies that a licensee of the Division is not required to provide the annual privacy notice otherwise required under rule 191—90.4(505) if the licensee both (1) provides nonpublic personal information to nonaffiliated third parties except as in accordance with rules 191—90.12(505), 191—90.13(505) and 191—90.14(505), and (2) has not changed or amended the privacy policies and practices that the licensee disclosed to the consumer in the privacy notice that the licensee most recently delivered to the consumer in accordance with rule 191—90.3(505) or 191—90.4(505). If at any time a licensee fails to comply with (1) or (2), the licensee shall be required to provide the annual privacy notice. All licensees shall continue to provide initial privacy notices required under Chapter 90.    Notice of Intended Action was published in the Iowa Administrative Bulletin on October 26, 2016, as ARC 2788C. A public hearing was held on November 16, 2016, and written comments were accepted through that date. One written comment was received in support of the amendment. This adopted amendment is identical to that published under Notice.    This amendment is subject to waiver consistent with the waiver provisions provided at 191—Chapter 4.    These rules will impose no fiscal impact on the State.    After analysis and review of this rule making, no impact on jobs has been found.    This amendment is intended to implement Iowa Code chapter 505.    This amendment shall become effective January 25, 2017.    The following amendment is adopted.

    ITEM 1.    Rescind subrule 90.4(4) and adopt the following new subrule in lieu thereof:    90.4(4)   A licensee is not required to provide an annual privacy notice if both of the following are true: the licensee has not changed the privacy policies and practices that the licensee disclosed to the consumer in the privacy notice that the licensee most recently delivered to the consumer in accordance with rule 191—90.3(505) or this rule; and the licensee does not disclose any nonpublic personal information about the consumer to any nonaffiliated third party except as authorized by rules 191—90.12(505), 191—90.13(505) and 191—90.14(505). If a licensee at any time fails to comply with the criteria of this subrule, the licensee shall immediately provide to the consumer the annual privacy notice required under this chapter.     [Filed 11/30/16, effective 1/25/17][Published 12/21/16]Editor’s Note: For replacement pages for IAC, see IAC Supplement 12/21/16.
ARC 2874CPublic Safety Department[661]Adopted and Filed

    Pursuant to the authority of Iowa Code sections 101.1(1), 101.2, 101.4 and 101.5, the State Fire Marshal in the Department of Public Safety hereby amends Chapter 226, “Liquefied Petroleum Gas,” Iowa Administrative Code.    The amendments allow for the public fueling of motor vehicles with liquefied petroleum gas, known as “LP gas,” and will authorize the owner or the owner’s designee to provide training for the safe operation of the system to the users who are dispensing LP motor fuel into LP-gas fueled motor vehicles. The amendments are consistent with the recent amendments to rule 661—201.2(100), which incorporated by reference the International Fire Code, 2015 edition. With the adoption of the current edition of the International Fire Code, the public fueling of motor vehicles with LP gas is now authorized. Automakers are now making vehicles that run on alternative fuels that replace conventional gasoline and diesel. One of the more popular fuels is LP gas. The Iowa Propane Gas Association (IPGA) supports these amendments, and there are members who are in the process of creating fueling stations to be ready when the amendments become effective. The additional fuel source will benefit Iowans and Iowa’s economy.    Notice of Intended Action was published in the Iowa Administrative Bulletin as ARC 2658C on August 3, 2016. A public hearing was held on August 31, 2016, in Room 125 of the Oran Pape State Office Building, Des Moines, Iowa. No members of the public attended the hearing, and no public comments were received at the hearing.    Comments were received from the IPGA regarding some revisions to the noticed amendments. Further discussions were held. The comments from IPGA requested that some of the language that had already been incorporated in the adoption of the 2015 International Fire Code and that was repeated in the rule be deleted. Standards of the National Fire Protection Association (NFPA) 58 prevail over the 2015 International Fire Code when those standards are in conflict, and language in the noticed rule to the contrary was removed. Finally, further changes were made to the new subrule that created an exception to the training requirements, to clarify that a person who is only fueling a vehicle and who does not otherwise transfer, or is not employed to transport, LP gas, or whose primary duties do not fall within the scope of the chapter, is exempt from the training requirements of the rule.    As a result of the comments, the following changes were made to the amendments as published under Notice of Intended Action:    In Item 1, new subrule 226.4(5), the reference to paragraph 226.10(2)“c” was changed to subrule 226.10(2), as that paragraph “c” has now been renumbered as subrule 226.10(2). The second sentence of subrule 226.4(5) was changed to read, “[i]f the user is also a person who transfers or is employed to transport liquefied petroleum gas, or whose primary duties fall within the scope of this chapter, then the person must comply with the requirements of subrules 226.4(1) through 226.4(4).” This change was requested by IPGA in order that it be understood that the exception for users applied only to people who were only fueling a motor vehicle and did not have any other role in transferring, transporting, or handling LP gas. There is no change to the effect or purpose of the subrule from the noticed rule.    The proposed amendment to rule 661—226.9(101) in Item 2 of the Notice was not adopted. In the existing rule, the NFPA standards control over the 2015 International Fire Code standards for the fueling of LP-gas fueled motor vehicles. Item 3 of the Notice has been renumbered as Item 2.    In noticed Item 3, now Item 2, in new rule 661—226.10(101), the introductory paragraph of subrule 226.10(2) and paragraphs 226.10(2)“a,” “b” and “d” to “g” were not adopted since the standards in those paragraphs were previously included with the adoption of the 2015 International Fire Code. Paragraph 226.10(2)“c,” the only remaining paragraph, was renumbered as subrule 226.10(2).    The statutory requirements of Iowa Code chapter 101 regarding combustible and flammable liquids and compressed gases cannot be waived. To the extent that rules are not statutorily required, those rules are subject to the waiver provisions of rule 661—10.222(17A).    The State Fire Marshal in the Department of Public Safety adopted these amendments on November 30, 2016.    After analysis and review of this rule making, there should be a positive impact on jobs and a positive impact on the safety of the public.    These amendments are intended to implement Iowa Code sections 101.1(1) and 101.2.    These amendments will become effective January 25, 2017.    The following amendments are adopted.

    ITEM 1.    Adopt the following new subrule 226.4(5):    226.4(5)   The training requirements of subrules 226.4(1) through 226.4(4) shall not apply to users as defined in subrule 226.10(2). If the user is also a person who transfers or is employed to transport liquefied petroleum gas, or whose primary duties fall within the scope of this chapter, then the person must comply with the requirements of subrules 226.4(1) through 226.4(4).

    ITEM 2.    Adopt the following new rule 661—226.10(101):

661—226.10(101) Public fueling of LP-gas motor fuel vehicles.       226.10(1)   Self-service LP-gas dispensing systems, including key, code, and card lock dispensing systems, shall be limited to the filling of permanently mounted containers providing fuel to the LP-gas powered vehicle.    226.10(2)   The owner of the LP-gas motor fuel dispensing facility or the owner’s designee shall provide for the safe operation of the system and the training of users. “Users” means the person or persons using an LP-gas motor fuel dispensing facility to dispense LP-gas motor fuel into an LP-gas fueled motor vehicle.
    [Filed 11/30/16, effective 1/25/17][Published 12/21/16]Editor’s Note: For replacement pages for IAC, see IAC Supplement 12/21/16.
ARC 2875CTreasurer of State[781]Adopted and Filed

    Pursuant to the authority of Iowa Code section 12D.2, the Treasurer of State hereby amends Chapter 16, “Iowa Educational Savings Plan Trust,” Iowa Administrative Code.    Chapter 16 is amended to comply with federal law changes. The Treasurer of State also used this opportunity to review additional rules and subrules in this chapter to provide revisions, updates, and clarifications to existing Iowa educational savings plan trust rules administered by the Treasurer of State.    Notice of Intended Action was published in the Iowa Administrative Bulletin as ARC 2791C on October 26, 2016. A public hearing was held on November 15, 2016, at 10 a.m. in the State Capitol, Room 116, 1007 E. Grand Avenue, Des Moines, Iowa. Interested persons also had the opportunity to make written comments on the proposed amendments on or before November 15, 2016. No public comments were received. One change to the amendments was made since publication of the Notice. In subrule 16.11(4), the words “Iowa 529 plan” were stricken and the word “trust” was added.    The general waiver provisions of the Treasurer of State in 781—Chapter 19 apply to these amendments.    The Treasurer of State adopted these amendments on November 30, 2016.    After analysis and review of this rule making, no impact on jobs has been found.    These amendments are intended to implement Iowa Code chapter 12D.    These amendments will become effective January 25, 2017.    The following amendments are adopted.

    ITEM 1.    Amend rule 781—16.2(12D) as follows:

781—16.2(12D) Definitions.  In addition to the terms defined in Iowa Code section 12D.1, the following terms apply to this chapter:        "Academic period" means one semester or one quarter or such other equivalent period as may be defined by the qualified institution of higher education.        "Account" means an account established and maintained under the Iowa educational savings plan trust for a beneficiary.        "Account balance" means the fair market value of an account.        "College savings Iowa" means the name and logo registered under Iowa law to represent the direct-sold Iowa 529 plan under the Iowa educational savings plan trust.        "Contribution" means an amount contributed to an account in accordance with the Internal Revenue Code, these rules and the application program description.        "Eligible educational institution" means any college, university, vocational school, or other postsecondary educational institution eligible to participate in a student aid program administered by the U.S. Department of Education.        "Half-time" means at least half-time if he or she is enrolled for at least half the full-time academic workload for the course of study the student is pursuing, as determined under the standards of the school where the student is enrolled.        "Iowa 529 plan" means college savings Iowa, the Iowa advisor 529 plan, and any other college savings plan established by the program administrator, collectively, under the Iowa educational savings plan trust.        "Iowa advisor 529 plan" means the name and logo registered to represent the advisor-sold Iowa 529 plan under the Iowa educational savings plan trust.        "Participant" means an individual, individual’s legal representative, trust, estate, or an organization described in Section 501(c)(3) of the Internal Revenue Code and exempt from taxation under Section 501(a) of the Internal Revenue Code that opens an account in a plan and that owns and controls the assets held in the account.        "Participation agreement" means the form that the participant submits to the program administrator to identify the participant, beneficiary, plan, and other information that may be requested by the program administrator.        "Payments" means the money paid by the participant to the trust under the participation agreement.        "Plan" means either (1) college savings Iowa, (2) Iowa advisor 529 plan, or (3) any other college savings plan established by the program administrator under the Iowa educational savings plan trust.        "Program administrator" means the treasurer of state.        "Program description" means the description of each plan provided to participants setting forth information with respect to the plan.        "Qualified higher education costsexpenses" means tuition, fees, and the cost of books, supplies and equipment required for the enrollment or attendance of the beneficiary at a qualified institution of higher educationthe same as “qualified higher education expenses” as defined in Section 529(e)(3) of the Internal Revenue Code. Room and board shall be treated as qualified higher education costs for a beneficiary, subject to maximum annual dollar amounts determined by the program administrator, if room and board are incurred during an academic period in which the beneficiary is enrolled or accepted for enrollment in a degree, certificate or other program that leads to a recognized educational credential (such as a bachelor’s degree or an associate’s degree) awarded by a qualified institution of higher education. The beneficiary must be enrolled at least half-time for board expenses to be qualified.        "Qualified institution of higher education" means an institution described in Section 481 of the federal Higher Education Act of 1965 that is eligible to participate in the United States Department of Education’s student aid programs. State universities in Iowa and other states qualify, as do community colleges and private accredited four-year and two-year colleges. Some vocational and technical schools qualify as well.        "Successor participant" means a successor to the ownership of an account designated as such in accordance with rule 781—16.9(12D) and the applicable program description.

    ITEM 2.    Amend rule 781—16.3(12D) as follows:

781—16.3(12D) Participation agreement and program description.  The following material shall be used to administer the Iowa educational savings plan trust.    16.3(1)   “Participation agreement” means the form that the participant submits to the program administrator to identify the participant, beneficiary, plan, and other information that may be requested by the program administrator. The participation agreement shall be signed and dated by the participant to verify that the participant agrees to the terms and conditions of the program. For online applications, participants must confirm that they have read the terms and conditions prior to submitting the application.    16.3(2)   Each plan will have a program description setting forth the terms of the plan and describing the investments,and proceduresand fees applicable to that plan.Each program description shall also set forth the privacy policy adopted by the program administrator for that plan. Persons interested in a plan should consult the plan description. A plan description may be changed at any time by the program administrator, and any such change may impact the rights of participants and beneficiaries under the plan.

    ITEM 3.    Amend subrules 16.4(1) and 16.4(2) as follows:    16 16.4 4(1)   Appropriate forms must be completed inon paper, online or via telephone (whichever is applicable for the requested actions) to perform the actions listedbelow. Current forms are available online at www.collegesavingsiowa.com for college savings Iowa and at www.iowaadvisor529.com for the Iowa advisor 529 plan. Actions which require the completion of an appropriate form include the following:    a.    Terminate a participation agreement.    b.    Transfer ownership rights of an Iowa 529 plan account to another person pursuant to Iowa Code section 12D.6(5).    c.    Request the substitution of a beneficiary.    d.    Exchange investments.    e.    Establish, delete or change automatic investments.    f.    Establish, delete or change banking information.    g.    Request a qualified withdrawal.    h.    Request an allocation update.    i.    Request for payroll deduction.    j.    Establish, delete or change electronic bank transfer information.    k.    Establish, delete or change interested party information.    l.    Establish, delete or change successor information.    m.    Change E-mail address on file.    n.    Change address on file.    o.    Request a rollover to another 529 plan.    p.    Establish, delete or change power of attorney on an account.    q.    Change beneficiary information on an account.    a.    Open or close an account.    b.    Transfer ownership rights of an account to another person.    c.    Change a beneficiary.    d.    Exchange existing investments.    e.    Change the direction of future contributions.    f.    Establish, delete or change automatic investments.    g.    Make an additional purchase by check.    h.    Request a full or partial withdrawal.    i.    Add, change or delete payroll deduction.    j.    Establish or make an electronic bank transfer.    k.    Establish, delete or change interested party information.    l.    Establish, delete or change a successor participant.    m.    Change the participant’s e-mail or mailing address or telephone number.    n.    Request a rollover to another 529 plan.    o.    Transfer funds from a qualified U.S. savings bond.    p.    Roll over assets directly or indirectly from another 529 plan.    q.    Establish, delete or change the power of attorney on an account.    r.    Authorize limited power of attorney for the account.    s.    Authorize or change a financial advisor who can obtain information regarding the account.    t.    Identify the current trustee of a trust.    u.    Identify officers of an organization.    v.    Update beneficiary information on the account.    16 16.4 4(2)   The program administrator may from time to time provide additional forms for use by participants and beneficiaries in connection with actions involving the Iowa 529a plan and will make those forms available online and in paper formatand may authorize substitute forms for a plan or a process in lieu of existing forms, except when not permitted by Iowa Code chapter 12D.

    ITEM 4.    Amend rule 781—16.5(12D) as follows:

781—16.5(12D) Participant eligibilityResponsibilities.  Iowa Code section 12D.3 provides that the trust may enter into participation agreements with participants to effectuate the purposes, objectives and provisions of the trust. This rule establishes the eligibility criteria for a participant.    16.5(1) Participant responsibilities.  Individual participants must meet the following requirements:    a.    A participant must be at least 18 years old and a resident of the United Statescitizen or resident alien with a valid social security number or tax identification number.    b.    A participant shall execute a participation agreement with the program administrator that specifies the plan selected by the participant and the terms and conditions under which the participant shall participate in the trust.    c.    A participant shall, on signing a participation agreement, provide the program administrator with the participant’s social security numberor tax identification number.    d.    Participants which are trusts must submit evidence that the individual trustee is so authorized and agrees to the terms of the participation agreement and must provide the information requested by the program administrator. Participants which are described in Section 501(c)(3) of the Internal Revenue Code must provide their tax identification number and any other information requested by the program administrator.    16.5(2) Program administrator responsibilities.      a.    The program administrator reserves the right to:    (1)   Freeze an account or suspend account services or do both when a plan has received reasonable notice of a dispute regarding the assets in an account, including notice of a dispute in account ownership or when the plan reasonably believes a fraudulent transaction may occur or has occurred;     (2)    Freeze an account or suspend account services or do both upon the notification to the plan of the death of a participant until the plan receives required documentation in good order and reasonably believes that it is lawful to transfer the account ownership to the successor participant;     (3)   Redeem an account, without the participant’s permission, in cases of threatening conduct or suspicious, fraudulent, or illegal activity; and    (4)   Reject a contribution for any reason, including contributions that the plan believes are not in the best interests of the plan, a portfolio, or the participants.     b.    The risk of market loss, tax implications, penalties, and any other expenses, as a result of such an account freeze, account redemption, or contribution rejection, will be solely the participant’s responsibility.

    ITEM 5.    Amend rule 781—16.7(12D) as follows:

781—16.7(12D) Payments and payment schedulesContributions.  Contributions are deductible under Iowa income tax laws in accordance with regulations of the department of revenue.Iowa Code section 12D.3(1) states that participationParticipation agreements may require participants to agree to invest a specific amount of money in the trusta plan for a specific period of time for the benefit of a specific beneficiary. This rule provides for implementation of this provision.    16.7(1)   The program administrator will provide each participant a quarterlyfourth quarter statement.In addition, the program administrator will provide each participant that had an account with either contributions or withdrawals in the first, second, or third quarter with a quarterly statement for that account. Participants are allowed to make contributions at any time during the calendar year provided that each contribution is made in accordance with the minimum contribution and other requirements set forth in the program description.    16.7(2)   The program administrator shall actuarially determine an account balance limit applicable tothe total of all accountsin the plans for the benefit of each beneficiary. No additional paymentscontributions may be made on behalf of a beneficiary if the total of theaccount balances of all accounts held for the beneficiary exceed the applicable account balance limit.    16.7(3)   Beginning in 2000 and each year thereafter, the program administrator shall determine the maximum amount that a participant may contribute and deduct from Iowa income taxes pursuant to Iowa Code chapter 422 on behalf of a beneficiary for the calendar year by applying the applicable inflation adjustment. The adjusted annual maximum shall be communicated to participants in Iowa 529the plans and to the public in any reasonable manner determined by the program administrator.

    ITEM 6.    Amend rule 781—16.9(12D) as follows:

781—16.9(12D) Change of participant or account owner.  The participant is the initial owner of the account established underan Iowa 529a plan and, as such, has the exclusive right to cancel the participation agreement or change the designated beneficiary in accordance with these rules and the applicable program description.    16.9(1)   A participant may transfer the participant’s current ownership rights in an account to another eligible individual, an individual’s legal representative, a trust, an estate, or an organization described in Section 501(c)(3) of the Internal Revenue Code and exempt from taxation under Section 501(a) of the Internal Revenue Code or to a minor beneficiary. To do so, the participant shall complete the appropriate form.    16.9(2)   A participant may also designate on the participation agreement a successor, who shall succeed to the ownership of the account in the event of the death of the participant. A participant may change the designated successor by completing the appropriate form.The designated successor shall succeed to the ownership of the account in the event of the death of the participant. Upon the death of the participant, the successor participant must notify the plan by submitting a completed participant agreement form and a certified copy of the death certificate. The change in ownership of the account will become effective for the successor participant once this paperwork has been received and processed.    16.9(3)   In the event a participant or other account owner dies and has not designated a successor to the account, the following criteria will be used.    a.    The designated beneficiary, if 18 years of age or older at the time of the participant’s death, shall become the owner of the Iowa 529 plan account as well as remainingremain the beneficiaryupon filing the appropriate forms.    b.    If the designated beneficiary is under the age of 18, account ownership will be transferred to the beneficiary’sa surviving parent or other legal guardianof the beneficiary upon the filing of the appropriate forms.    16.9(4)   The participant may name a successor to the account even though the successor may already have established or may have plans to establish an Iowa 529a plan account.

    ITEM 7.    Amend rule 781—16.10(12D) as follows:

781—16.10(12D) Payment of benefits and qualified distributionsQualified withdrawals.  This rule establishes the procedures for the payment of benefitsqualified withdrawals.    16.10(1)   The participant must initiate distributionsa withdrawal for qualified or nonqualified expenses. The participant must file the appropriate form with the program administrator.    16.10(2)   BenefitsQualified withdrawals will be paid in one of three ways once the request has been received by the program administrator:    a.    Directly to the institution of higher education for qualified expenses only.    b.    Directly to the participant for qualified or nonqualified expenses.    c.    Directly to the beneficiary for qualified expenses only.    16.10(3)   Each distribution of benefitsqualified withdrawal will be comprised partly of contributions and partly of earnings, based upon the same proportion that contributions and earnings comprise the participant’s account at the time of the distributionwithdrawal.    16.10(4)   Funds that are distributed to a participant pursuant to this rule shall be reported to the IRS on a 1099Q in the tax year in which such distributionwithdrawal is made. The participant will receive the 1099Q for any distributionswithdrawal made to the participant. The beneficiary will receive the 1099Q for any distributionswithdrawal made to the beneficiary or institution of higher education. The individual receiving the 1099Q must determine whether the distributionwithdrawal was qualified or nonqualified. Nonqualified distributions may be subject to state and federal taxes and penalties.    16.10(5)   A participant may transfer any remaining balance in one account to an existing or new account for another designated beneficiary by completing a new participation agreement with the program administrator.

    ITEM 8.    Amend rule 781—16.11(12D) as follows:

781—16.11(12D) WithdrawalsNonqualified withdrawals and cancellation.  Iowa Code section 12D.5 provides that any participant may cancel a participation agreement at will. This rule establishes the criteria fornonqualified withdrawals from or the cancellation of a participation agreement.    16.11(1)   A nonqualified withdrawal is one in which the funds are used for a purpose other than the payment of or reimbursement for qualified educational expenses.A participant may at any time withdrawmake a nonqualified withdrawal of a portion of the amount in an account or cancel a participation agreement, without cause, by submitting to the program administrator the appropriate form.A nonqualified withdrawal will be paid only to the participant.    16.11(2)   If the participation agreement is canceled, the participant is entitled to the amount in the account, subject to any applicable fees and expenses. The balance shall be mailed or otherwise sent to the participant after receipt by the program administrator of the appropriate form.    16.11(3)   Funds that are distributed to a participantin a nonqualified withdrawal pursuant to this rule shall be reported to the IRS on a 1099Q in the tax year in which such distributionwithdrawal is made. The participant will receive the 1099Q for any distributions made to the participantnonqualified withdrawals. The beneficiary will receive the 1099Q for any distributions made to the beneficiary or institution of higher education. The individual receiving the 1099Q must determine whether the distribution was qualified or nonqualified. Nonqualified distributionswithdrawals may be subject to state and federal taxes and penalties.    16.11(4)   Pursuant to Iowa Code section 642.2, funds held by the program administrator under the Iowa 529 plantrust are not subject to garnishment.
    [Filed 11/30/16, effective 1/25/17][Published 12/21/16]Editor’s Note: For replacement pages for IAC, see IAC Supplement 12/21/16.

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