Present were:

Members: Senator Richard "Dick" Roeding, Co-Chair; Senators Alice Kerr, Joey Pendleton, and Gary Tapp; Representatives James E Bruce, Jimmie Lee, and Jon David Reinhardt.

Guests: Todd Leatherman, Maryellen Mynear, Kevin R. Winstead, Office of the Attorney General; Eddie Mattingly, Department of Revenue; Lloyd Vest, Board of Medical Licensure; Larry Disney, James Grawe, C.W. Wilson, Real Estate Appraisers Board; Bill Caldwell, Justin Dearinger, David W. Morgan, Division of Water; Dana Fugazzi, Transportation Cabinet; B.J. Helton, Melissa F. Justice, Reecie Stagnolia, Dennis L., Taulbee, Council on Postsecondary Education; Rose L. Baker, Al Mitchell, David Reichert, Environmental and Public Protection Cabinet; Jan Howell, Jason Milligan, Stuart Owen, Chris Stewart, Cabinet for Health and Family Services; Rick O. Baumgardner, Frank Dempsey, Kentucky Watch Publications, Carolyn Quisenberry, Dennis McKiernan, John J. Weikel, II, Educational Training Systems, Inc.

LRC Staff: Dave Nicholas, Emily Caudill, Donna Little, Laura Milam, Karen Howard, Sarah Amburgey, Jenifer Harrison, and Emily Harkenrider.

The Administrative Regulation Review Subcommittee met on Tuesday, July 12, 2005, and submits this report:

Administrative Regulations Reviewed by the Subcommittee:

Office of the Attorney General: Consumer Protection Division

40 KAR 2:350. Debt adjusters. Maryellen Mynear, Litigation Branch Manager, Todd Leatherman, Director, and Kevin Winstead, Assistant Attorney General, represented the Division.

A motion was made and seconded to approve the following amendments: (1) to amend the RELATES TO and STATUTORY AUTHORITY paragraphs and Sections 1, 2, 4, 5, and 6 to correct statutory citations; (2) to amend the NECESSITY, FUNCTION, AND CONFORMITY paragraph to clearly state the necessity for and function served by the administrative regulation, as required by KRS 13A.220; (3) to amend Section 2 to comply with the drafting and format requirements of KRS Chapter 13A; (4) to amend Section 2 to delete the requirement that information be submitted regarding past bad practices of the applicant and to delete language regarding application withdrawal prior to approval, to comply with KRS Chapter 380; and (5) to amend the forms incorporated by reference to comply with the changes made to the administrative regulation. Without objection, and with agreement of the agency, the amendments were approved.

Finance and Administration Cabinet: Department of Revenue: Division of Legislative Services: General Administration

103 KAR 1:050. Forms Manual. Eddie Mattingly, Director, represented the Division.

A motion was made and seconded to approve the following amendments: to amend the "Incorporation by Reference" section to comply with the drafting and format requirements of KRS Chapter 13A. Without objection, and with agreement of the agency, the amendments were approved.

General Government Cabinet: Board of Medical Licensure

201 KAR 9:018. Physician advertising. Lloyd Vest, General Counsel, represented the Board.

A motion was made and seconded to approve the following amendments: (1) to amend the RELATES TO paragraph to correct statutory citations; and (2) to amend Sections 1, 2, and 4 to 6 to comply with the drafting and format requirements of KRS Chapter 13A. Without objection, and with agreement of the agency, the amendments were approved.

Real Estate Appraisers Board: Board

201 KAR 30:150. Education provider approval. Jim Grawe, General Counsel, C.W. Wilson, Chairman, and Larry Disney, Executive Director, represented the Board. Rick Baumgardner, Licensed General Certified Appraiser in Kentucky and Indiana, appeared in favor of these administrative regulations. Dennis McKiernan, Counsel, Educational Training Systems, Inc., and John Weikel, President, Educational Training Systems, Inc., appeared in opposition to these administrative regulations.

In response to questions by Co-Chair Roeding, Mr. Weikel stated that he did not submit written comments or request a public hearing on these administrative regulations because he missed the deadlines.

Co-Chair Roeding stated that the Board worked with Subcommittee staff to draft amendments to these administrative regulations which changed their effective dates to January 1, 2008 and made technical corrections.

In response to a question by Representative Reinhardt, Mr. Weikel stated that he wanted the Subcommittee to defer consideration of these administrative regulations for a year. During that time, additional amendments could be drafted and his company could obtain updated training materials from national publishers which complied with the new regulatory requirements.

Representative Bruce stated that the Subcommittee could not defer consideration of administrative regulations without agreement from the promulgative administrative body.

In response to a question by Representative Bruce, Mr. Weikel stated that he had spoken to the Board about his concerns with these administrative regulations.

In response to questions by Senator Pendleton, Mr. Weikel stated that it was premature for Kentucky to amend their regulatory requirements for appraisers, because the new federal standards did not go into effect until 2008, and updated training materials from national publishers would not be available until late 2006 or 2007.

Senator Pendleton stated that it would be better to proceed with these administrative regulations now, so that Kentucky would be prepared to implement the new federal standards in 2008.

Senator Tapp stated that he too preferred proceeding with these administrative regulations to provide the maximum notice of the new requirements. Additionally, he was not aware of any other educational providers that were opposed to these administrative regulations.

In response to a question by Senator Kerr, Mr. Weikel stated that Educational Training Systems, Inc. was headquartered in Louisville and had offices in Lexington and in northern Kentucky.

Representative Lee stated that he favored proceeding with the administrative regulations, because the proposed amendments resolved many of the concerns noted by Mr. Weikel. Furthermore, the Board could work with Educational Training Systems, Inc. in the future to address any remaining technical issues.

In response to a question by Co-Chair Roeding, Mr. Baumgardner stated that he approved of these administrative regulations and their proposed amendments.

Mr. Wilson stated that it was important to proceed with these administrative regulations to provide adequate notice of the new federal standards before they became effective.

A motion was made and seconded to approve the following amendments: (1) to amend the STATUTORY AUTHORITY paragraph to correct statutory citations; and (2) to amend Sections 1 to 3 to comply with the drafting and format requirements of KRS Chapter 13A. Without objection, and with agreement of the agency, the amendments were approved.

201 KAR 30:160. Standards for Instructors. A motion was made and seconded to approve the following amendments: (1) to amend the STATUTORY AUTHORITY paragraph to correct statutory citations; and (2) to amend Sections 1 and 4 to comply with the drafting and format requirements of KRS Chapter 13A. Without objection, and with agreement of the agency, the amendments were approved.

201 KAR 30:170. Evaluation of Instructors. A motion was made and seconded to approve the following amendments: (1) to amend the STATUTORY AUTHORITY paragraph to correct statutory citations; (2) to amend Sections 2 and 3 to comply with the drafting and format requirements of KRS Chapter 13A; and (3) to amend Section 2 to require that ratings be averaged. Without objection, and with agreement of the agency, the amendments were approved.

201 KAR 30:180. Distance education standards. A motion was made and seconded to approve the following amendments: (1) to amend the STATUTORY AUTHORITY paragraph to correct statutory citations; (2) to amend Sections 1, 2, 3, 5, and 6 to comply with the drafting and format requirements of KRS Chapter 13A; (3) to amend Section 3(4) to replace language that was vague and ambiguous; and (4) to amend Section 3(6) to establish requirements for a final examination. Without objection, and with agreement of the agency, the amendments were approved.

201 KAR 30:190. Education requirement for applications received after December 31, 2007. A motion was made and seconded to approve the following amendments: (1) to amend the title to accurately reflect the subject matter of the administrative regulation; (2) to amend Sections 2 to 7 to comply with the drafting and format requirements of KRS Chapter 13A; and (3) to amend Section 3 to replace references to the Appraisal Standards Board with references to the Appraisal Qualification Board. Without objection, and with agreement of the agency, the amendments were approved.

Environmental and Public Protection Cabinet: Department for Environmental Protection: Division of Water: Water Resources

401 KAR 4:010. Water withdrawal permits, criteria, reports. Bill Caldwell, Supervisor, and David Morgan, Director, represented the Division.

In response to questions by Senator Tapp, Mr. Morgan stated that this administrative regulation aided businesses in obtaining financing for projects by permitting them to reserve water availability four and half years earlier than was currently allowed.

A motion was made and seconded to approve the following amendments: (1) to amend the STATUTORY AUTHORITY paragraph to insert statutory citations; (2) to amend the NECESSITY, FUNCTION, AND CONFORMITY paragraph to clearly state the necessity for and function served by this administrative regulation; (3) to amend Section 3(3) to clarify the requirements for increased recording and reporting of the rate or volume of a permitted water withdrawal; and (4) to amend Sections 1, 2, and 3 to comply with the drafting and format requirements of KRS Chapter 13A. Without objection, and with agreement of the agency, the amendments were approved.

Council on Postsecondary Education: Adult Education and Literacy

785 KAR 1:130. GED eligibility requirements. B.J. Helton, Senior Associate, Reecie Stagnolia, Vice President, and Dennis Taulbee, General Counsel, represented the Council.

In response to questions by Senator Tapp, Mr. Stagnolia stated that currently, a student could not take the GED tests within a year of dropping out or until the student's last enrolled class had graduated. The amendments to this administrative regulation reduced the waiting time to take the GED tests allowing the student to be eligible to test before October 1. Additionally, participating students did not count towards a district's dropout statistics. The new testing period followed the ninety (90) day window that school districts had to reengage dropout students. Earlier testing allowed the students to improve their employment opportunities or enter postsecondary education without an extended delay.

In response to a question by Representative Reinhardt, Mr. Stagnolia stated that research confirmed that GED program participation declined the longer a student was out of school.

In response to questions by Co-Chair Roeding, Mr. Stagnolia stated that earlier testing prevented students from remaining in an unproductive holding pattern while waiting to take their GED tests.

Subcommittee staff stated that the amendments to this administrative regulation were necessary to conform to the Secondary GED Program established by KRS 158.6455 and 704 KAR 7:150.

A motion was made and seconded to approve the following amendments: (1) to amend the RELATES TO and STATUTORY AUTHORITY paragraphs to correct citations; (2) to amend the NECESSITY, FUNCTION, AND CONFORMITY paragraph to clearly state the necessity for and function served by this administrative regulation; and (3) to amend Sections 1 to 4 to comply with the drafting and format requirements of KRS Chapter 13A. Without objection, and with agreement of the agency, the amendments were approved.

Environmental and Public Protection Cabinet: Office of State Fire Marshal: Manufactured Homes and Recreational Vehicles

815 KAR 25:080. Requirements for certifying manufactured home installers. David Reichert, General Counsel, and Al Mitchell, State Fire Marshal, represented the Office.

A motion was made and seconded to approve the following amendments: (1) to amend the NECESSITY, FUNCTION, AND CONFORMITY paragraph to clearly state the necessity for and function served by this administrative regulation, as required by KRS 13A.220; (2) to amend Section 5 to delete provisions that repeated or summarized statute, in accordance with KRS 13A.120(2)(e) and (f); and (3) to amend Sections 1 to 6 to comply with the drafting and format requirements of KRS Chapter 13A. Without objection, and with agreement of the agency, the amendments were approved.

Cabinet for Health and Family Services: Department for Medicaid Services: Office of the Commissioner: Medicaid Services

907 KAR 1:018 & E. Reimbursement for Drugs. Jason Milligan, Director, Jan Howell, Director, and Stuart Owen, Regulation Coordinator, represented the Department.

A motion was made and seconded to approve the following amendments: (1) to amend the STATUTORY AUTHORITY paragraph to correct statutory citations; and (2) to amend the NECESSITY, FUNCTION, AND CONFORMITY paragraph and Sections 1 to 5 to comply with the drafting and format requirements of KRS Chapter 13A. Without objection, and with agreement of the agency, the amendments were approved.

907 KAR 1:019 & E. Outpatient pharmacy program. A motion was made and seconded to approve the following amendments: (1) to amend the STATUTORY AUTHORITY and NECESSITY, FUNCTION, AND CONFORMITY paragraphs to delete references to the 2004 executive order relating to reorganization; and (2) to amend Sections 3, 4, 5, 7, 8, 10, and 11 to comply with the drafting and format requirements of KRS Chapter 13A. Without objection, and with agreement of the agency, the amendments were approved.

Division of Hospitals and Provider Operations: Medicaid Services

907 KAR 1:360 & E. Preventive and remedial public health services. Jason Milligan, Director, and Stuart Owen, Regulation Coordinator, represented the Department.

A motion was made and seconded to approve the following amendments: (1) to amend the STATUTORY AUTHORITY and NECESSITY, FUNCTION, AND CONFORMITY paragraphs to delete references to the 2004 executive order relating to reorganization; and (2) to amend Section 2 to correct a statutory citation. Without objection, and with agreement of the agency, the amendments were approved.

The Subcommittee and the promulgating agencies agreed to defer consideration of the following administrative regulations to the next meeting of the Subcommittee:

Council on Postsecondary Education: Public Educational Institutions

13 KAR 2:045. Determination of residency status for admission and tuition assessment purposes.

Environmental and Public Protection Cabinet: Department for Natural Resources: General Provisions

405 KAR 7:001. Definitions for 405 KAR Chapter 7.

Permits

405 KAR 8:001. Definitions for 405 KAR Chapter 8.

Bond and Insurance Requirements

405 KAR 10:001. Definitions for 405 KAR Chapter 10.

Inspection and Enforcement

405 KAR 12:001. Definitions for 405 KAR Chapter 12.

Performance Standards for Surface Mining Activities

405 KAR 16:001. Definitions for 405 KAR Chapter 16.

Performance Standards for Underground Mining Activities

405 KAR 18:001. Definitions for 405 KAR Chapter 18.

Special Performance Standards

405 KAR 20:001. Definitions for 405 KAR Chapter 20.

Areas Unsuitable for Mining

405 KAR 24:001. Definitions for 405 KAR Chapter 24.

Transportation Cabinet: Department of Vehicle Regulation: Commercial Driver's License

601 KAR 11:010. Fees relating to commercial driver's licenses. Dana Fugazzi, Attorney, represented the Department.

In response to a question by Senator Tapp, Subcommittee Staff stated that the amendments to this administrative regulation deleted the criminal records check requirement for additional endorsements because it exceeded the scope of KRS 281A.300. A criminal records check was still required by statute for an initial application and an initial renewal of commercial driver's licenses (CDLs).

In response to questions by Representative Bruce, Ms. Fugazzi stated that this administrative regulation standardized the fees for CDLs. The Department requested that the Subcommittee defer consideration of this administrative regulation, so they could make some additional language changes for clarification purposes.

Office of Insurance: Workers' Compensation Self-Insured Groups

806 KAR 52:020 & E. Aggregate excess insurance.

806 KAR 52:030 & E. Workers' compensation self-insured group rate, rule and form filings.

Department of Public Protection: Horse Racing Authority: Harness Racing

811 KAR 1:215 & E. Kentucky Standardbred Development Fund.

Cabinet for Health and Family Services: Office of Inspector General: Health Services and Facilities

902 KAR 20:330 & E. Psychiatric residential treatment facilities.

The subcommittee adjourned at 11:05 a.m., until Tuesday, August 9, 2005.