NOTICES

INDEPENDENT REGULATORY REVIEW COMMISSION

Notice of Comments Issued

[29 Pa.B. 5561]

   Section 5(g) of the Regulatory Review Act (act) (71 P. S. § 745.5(g)) provides that the designated standing committees may issue comments within 20 days of the close of the public comment period, and the Independent Regulatory Review Commission (Commission) may issue comments within 10 days of the close of the committee comment period. The Commission comments are based upon the criteria contained in section 5a(h) and (i) of the act (71 P. S. § 745.5a(h) and (i)).

   The Commission has issued comments on the following proposed regulations. The agency must consider these comments in preparing the final-form regulation. The final-form regulations must be submitted by the dates indicated.

			Final-Form
			Submission
Reg No.	Agency/Title	Issued	Deadline
16A-414	State Architects Licensure Board    Fees	10/7/99	9/07/01
	(29 Pa.B. 4170 (August 7, 1999))
16A-566	State Real Estate Commission    Application Fees	10/7/99	9/07/01
	(29 Pa.B. 4171 (August 7, 1999))

State Architects Licensure Board Regulation No. 16A-414

Fees

October 7, 1999

   We have reviewed this proposed regulation from the State Architects Licensure Board (Board) and submit for consideration the following objections and recommendations. Subsections 5.1(h) and (i) of the Regulatory Review Act (71 P. S. § 745.5a(h) and (i)) specify the criteria the Commission must employ to determine whether a regulation is in the public interest. In applying these criteria, our Comments address issues that relate to fiscal impact and clarity. We recommend that these Comments be carefully considered as you prepare the final-form regulation.

Section 9.3. Fees.--Fiscal impact and Clarity

Administrative overhead costs

   In the proposed regulation's Fee Report Forms, there are significant differences in the costs covered by different fees except for ''Administrative Overhead'' costs. According to the Preamble, the Bureau of Professional and Occupational Affairs (BPOA) calculated the allocated share of overhead cost for each fee category by dividing total overhead costs by the number of active licensees. This method of overhead cost allocation is not unreasonable and has been consistently applied. On the other hand, the cost allocations are based on estimates of the actual time BPOA staff spends performing the tasks related to each fee.

   For overhead cost allocations, there appears to be no relationship to the services covered by the fees or frequency of fee payments. Therefore, there is no indication that the fees will recover actual or projected overhead costs. In addition, the allocated costs are based on past expenditures rather than estimates or projections of future expenditures. There is no certainty that the fees' ''projected revenues will meet or exceed projected expenditures'' under section 11(a) of the Architects Licensure Law (63 P. S. § 34.11(a)).

   We question the use of a constant overhead cost allocation that appears to be unrelated to the actual costs of activities covered by different fees. Even though this process was used to determine other fees, why should BPOA maintain this approach? The Board and BPOA should specifically identify the overhead costs, or portion of the total overhead, to be recouped by these fees, and review their method of allocating these overhead costs. Is it the Board's goal to allocate all overhead costs by category to each fee? If so, we do not believe the current allocation formula gives the desired result.

Differing overhead costs

   The administrative overhead costs for all fees are $17.78, except for the verification of licensure and certification of scores, or licensure, which is $9.76. The Board should explain why the administrative costs for the verification of licensure and certification of scores, or licensure are different.

State Real Estate Commission Regulation No. 16A-566

Application Fees

October 7, 1999

   We have reviewed this proposed regulation from the State Real Estate Commission (Commission) and submit for consideration the following objections and recommendations. Subsections 5.1(h) and (i) of the Regulatory Review Act (71 P. S. § 745.5a(h) and (i)) specify the criteria the Commission must employ to determine whether a regulation is in the public interest. In applying these criteria, our Comments address issues that relate to fiscal impact and clarity. We recommend that these Comments be carefully considered as you prepare the final-form regulation.

1.  Section 39.72. Fees.--Fiscal impact and Clarity

Administrative overhead costs

   In the proposed regulation's fee report forms, there are significant differences in the costs covered by different fees except for ''Administrative Overhead'' costs. According to staff at the Department of State and its Bureau of Professional and Occupational Affairs (BPOA), the allocated share of overhead cost for each fee category is calculated by dividing total overhead costs by the number of active licensees. This methodology for overhead cost allocation is not unreasonable and has been consistently applied. On the other hand, the staff cost allocations are based on estimates of the actual time BPOA staff spends performing the tasks related to each fee.

   For overhead cost allocations, there appears to be no relationship to the services covered by the fees or frequency of fee payments. Therefore, there is no indication that the fees will recover actual or projected overhead costs. In addition, the allocated costs are based on past expenditures rather than estimates or projections of future expenditures. Hence, there is no certainty that the fees' ''projected revenues will meet or exceed projected expenditures'' under section 407(a) of the Real Estate Licensing and Registration Act (63 P. S. § 455.407(a)).

   We question the use of a constant overhead cost allocation that appears to be unrelated to the actual costs of activities covered by different fees. Even though this process was used to determine other fees, why should BPOA maintain this approach? The Commission and BPOA should specifically identify the overhead costs, or portion of the total overhead, to be recouped by these fees, and review their methodology for allocating these overhead costs. Is it the Commission's goal to allocate all overhead costs by category to each fee? If so, we do not believe the current allocation formula gives the desired result.

Differing overhead costs

   The administrative overhead costs for all fees are $13.56, except for the certification of history of licensure, registration or approval, which is $9.76. The Commission should explain why the administrative cost for certification of history of licensure, registration or approval is different.

2.  Section 35.203. Fees--Clarity.

Addition of satellite location or instructor for real estate school

   This section lists the category ''Addition of a satellite location or instructor for real estate school.'' The existing regulation includes ''course'' in this category. The proposed regulation lists ''Addition of course for real estate school'' as a separate category. As published in the Pennsylvania Bulletin, a comma that should have been shown as a deletion was inadvertently omitted. Therefore, the final regulation should be revised to read as follows: ''Addition of satellite location[, course] or instructor for real estate school.''

Certification of history of licensure, registration or approval

   This category of fees is included in the regulation. However, the accompanying fee report forms do not include ''certification of registration'' or ''certification of approval.'' The Commission should clarify if ''certification of registration'' and ''certification of approval'' were intended to be part of the fee report form for ''certification of history of licensure.'' If so, these fees should be added to the fee report form that accompanies the final regulation. If the Commission intended to include these fees on separate fee report forms, those forms should be included with the final regulation.

Fee report form for ownership change--private real estate school

   This fee report form contains a typographical error. The administrative overhead is listed as $3.56. It should be changed to $13.56.

Name change--private real estate school and initial license application--private real estate school

   The fee report form for ''Name change--private real estate school'' lists the Commission meeting average cost as $39.67. The fee report form for ''Initial license application--private real estate school'' lists the average cost of Commission review as $21.87. The Commission review of an initial license application is more detailed than the review of a name change. We request the Commission explain why the cost for the Commission meeting for a name change is higher than the more detailed Commission review of an initial license application.

JOHN R. MCGINLEY, Jr.,   
Chairperson

[Pa.B. Doc. No. 99-1807. Filed for public inspection October 22, 1999, 9:00 a.m.]

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