NOTICES

INDEPENDENT REGULATORY REVIEW COMMISSION

Notice of Comments Issued

[37 Pa.B. 2267]
[Saturday, May 12, 2007]

   Section 5(g) of the Regulatory Review Act (71 P. S. § 745.5(g)) provides that the Independent Regulatory Review Commission (Commission) may issue comments within 30 days of the close of the public comment period. The Commission comments are based upon the criteria contained in section 5.2 of the Regulatory Review Act (71 P. S. § 745.5b).

   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final-form regulation must be submitted within 2 years of the close of the public comment period or it will be deemed withdrawn.

Reg. No.	Agency/Title	Close of the Public Comment Period	IRRC Comments Issued
57-251	Pennsylvania Public    Utility Commission Provisions of Bundled    Service Package Plans    at a Single Monthly    Rate by Local    Exchange Carriers 37 Pa.B. 1032    (March 3, 2007)	4/2/07	5/2/07
16A-5721	State Board of    Veterinary Medicine Professional Conduct 37 Pa.B. 1038    (March 3, 2007)	4/2/07	5/2/07
15-436	Department of Revenue Pennsylvania Gaming    Cash Flow    Management 37 Pa.B. 1028    (March 3, 2007)	4/2/07	5/2/07

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Pennsylvania Public Utility Commission Regulation #57-251 (IRRC #2591)

Provisions of Bundled Service Package Plans at a Single Monthly Rate by Local Exchange Carriers

May 2, 2007

   We submit for your consideration the following comments on the proposed rulemaking published in the March 3, 2007 Pennsylvania Bulletin. Our comments are based on criteria in Section 5.2 of the Regulatory Review Act (71 P. S. § 745.5b). Section 5.1(a) of the Regulatory Review Act (71 P. S. § 745.5a(a)) directs the Pennsylvania Public Utility Commission (PUC) to respond to all comments received from us or any other source.

1.  Consistency with statute.

   In the preamble, the PUC quotes its Proposed Rulemaking Order (PUC Doc. No. L-00060179) which includes the following statement:

We note that while the Public Utility Code expressly grants local exchange telecommunications companies (incumbent local exchange carriers or ILECs) permission to offer single-rate package plans, 66 Pa.C.S. § 3016(e)(2), nothing in the Code precludes the Commission from authorizing competitive local exchange carriers (CLECS) to provide single-rate package plans. In fact, we believe that authorizing CLECS to provide such service packages advances two important policy goals: (1) to encourage diversity in services and products; and (2) to promote the provision of competitive services by a variety of service providers without jeopardizing universal service. See, 66 Pa.C.S. § 3011(5)(8).

   While expressing support for the PUC's stated goals in this rulemaking, some commentators take issue with the proposed regulatory language to accomplish this goal. We recognize that the PUC is attempting to address rapidly evolving services and providers. However, as written, portions of the regulation appear to regulate bundled service packages as a whole, rather than the protection of basic service within a bundled service package. Therefore, in light of 66 Pa.C.S. § 3016(e)(2), the PUC needs to further explain how the regulation is consistent with the statute as explained below.

Under the following conditions

   Under 66 Pa.C.S. § 3016(e)(2), ''local exchange telecommunications companies may offer and bill to customers on one bill bundled packages of services . . . .'' However, proposed Section 64.24 begins with the statement that ''An LEC may offer bundled packages of services . . . under the following conditions: . . . .'' The PUC needs to explain why it is consistent with the statute to impose in regulation restrictions not stated in 66 Pa.C.S. § 3016(e)(2).

Payment agreements for past-due amounts on bundled service packages

   Paragraph (4) states, ''The LEC may offer payment agreements for past-due amounts on bundled service packages.'' While the PUC has an interest in protecting basic service, the authority and purpose behind this provision regarding bundled services is not clear, particularly when bundled services include competitive services. The PUC should explain how this provision is consistent with 66 Pa.C.S. Chapter 30.

Notices issued pertaining to the bundled service package

   Paragraph (5) states, ''Notices issued by the LEC pertaining to the bundled service package . . . will be subject to Commission review and approval . . . .'' Again, while the PUC has an interest in protecting basic service, the authority and purpose behind this provision regarding all bundled services is not clear. The PUC should explain how this provision is consistent with 66 Pa.C.S. Chapter 30.

   Furthermore, Paragraph (5) states that ''notices issued by the LEC pertaining to the bundled service package, including . . . other communication, will be subject to Commission [PUC] review and approval . . . .'' The requirement relating to ''other communication'' is vague and could encompass irrelevant communications. We recommend deleting the phrase ''or other communication.''

2.  ''The LEC shall convert the customer's service''--Economic impact; Need; Reasonableness.

   Paragraph (2) states, ''When a customer fails to make payment on a bundled service package, the LEC shall convert the customer's service to a basic service plan . . . .'' There are two concerns.

   First, by use of the word ''shall,'' the regulation does not leave any discretion for the LEC and customer to resolve any issues that may have led to failure to make payment. Can the LEC and customer resolve payment issues before a basic service plan is imposed?

   Second, commentators cite concerns related to changing service to basic service. Although the intent of Paragraph (2) appears to be to separate basic service from bundled services, commentators question whether Paragraph (2) will create a confusing array of bills to the customer, impose unreasonable administrative costs for the LEC and allow a costly extension of termination proceedings. We will review the PUC's responses to the commentators on these issues to determine whether Paragraph (2) is in the public interest.

3.  Waiver of applicable Chapter 64 regulations.--Implementation procedures; Conflict with existing regulation; Clarity.

   In the Preamble, the PUC included in its order the following paragraph:

9.  Pending the final resolution of this rulemaking, the Chapter 64 separate billing requirement, including 52 Pa. Code §§ 64.14(a)(4) and (5), 64.17, 64.18, 64.21(a), and 64.63(1) and (2), are temporarily waived to the extent necessary to permit all LECs to offer bundled services packages, provided that the LEC agrees to the conditions set forth in the Secretarial Letter issued September 23, 2003, at Docket No. M-00031747.

   Even though the PUC recognizes these existing provisions are inconsistent with the proposed rulemaking, the proposed language amendments do not rectify the inconsistency. As a result, when the waiver expires, Chapter 64 will contain contradictory language. We offer two examples: The PUC temporarily waived the following requirements:

Section 64.14. Billing information.

(a)  Every bill rendered shall state clearly the following information:

*      *      *      *      *

(4)  The amount due for service and equipment during the current billing period, and the charges for toll service, local usage, taxes and applicable surcharges.

(5)  An itemized statement of toll charges listing the date, time, destination, duration and rate period for each toll call.

and

Section 64.21. Separate billing for basic service.

(a)  Charges for basic service shall be billed separately from charges for other services.

   Upon completion of this rulemaking, these provisions would no longer be waived. Hence, the above provisions will contradict Section 64.24 which states, ''An LEC may offer bundled packages of services . . . in a single package plan at a single monthly rate . . . .'' These contradictions need to be resolved prior to the filing of a final-form regulation. We recommend that the PUC consider either a new proposed rulemaking to allow the public, legislature, Attorney General and this Commission the opportunity to review and comment upon any changes not published in this proposed rulemaking, or an Advanced Notice of Final Rulemaking to allow interested parties the opportunity to comment on revisions.

   Finally, we recognize that the intent of this rulemaking is to implement a process that does not require a case-by-case waiver regarding bundled services. However, commentators see many implications beyond the proposed amendments and raised many issues related to 66 Pa.C.S. Chapter 30. In the final-form rulemaking preamble, the PUC should explain how it took into consideration 66 Pa.C.S. Chapter 30, including 66 Pa.C.S. §§ 3011(5), (6), (8) and (13); 3016 and 3019(b)(2) in the formulation of the language included in the final-form regulation.

State Board of Veterinary Medicine Regulation #16A-5721 (IRRC #2594)

Professional Conduct

May 2, 2007

   We submit for your consideration the following comments on the proposed rulemaking published in the March 3, 2007 Pennsylvania Bulletin. Our comments are based on criteria in Section 5.2 of the Regulatory Review Act (71 P. S. § 745.5b). Section 5.1(a) of the Regulatory Review Act (71 P. S. § 745.5a(a)) directs the State Board of Veterinary Medicine (Board) to respond to all comments received from us or any other source.

Section 31.21. Rules of Professional Conduct for Veterinarians.--Fiscal impact; Reasonableness; Implementation procedure; Clarity.

Principle 1. Competency.

   Subsection (d) indicates that veterinarians should take certain steps when they believe another veterinarian's actions ''demonstrate professional incompetence, neglect or animal abuse.'' By using the word ''should,'' the first part of the subsection appears to give discretion to a licensee in dealing with the incompetence of a colleague. The proposed regulation adds new language mandating that veterinarians file a complaint with the Bureau of Professional and Occupational Affairs (BPOA), and thereby the Board, when they observe conduct that is ''grossly incompetent, or involves neglect or animal abuse.'' We have three concerns.

   First, the use of the word ''should'' in this subsection is inappropriate because it is nonregulatory language which indicates that the provision is optional. When a veterinarian observes questionable actions by a colleague that demonstrate ''incompetence,'' the subsection states that the veterinarian ''should'' bring the matter to the colleague's attention. If a problem remains unresolved, the veterinarian ''should bring the matter to the attention of the Board.'' It is inappropriate to include optional provisions in a regulation. Regulations establish binding norms of general applicability and future effect. Furthermore, there is confusion over the discretionary nature of this provision with the addition of ''failing to report'' incompetence as grounds for disciplinary action under Principle 3(11). If reporting certain cases is to remain optional, the first half of this subsection would be more appropriately placed in a policy statement or guidance document.

   Second, new language in the first half of the subsection does not indicate how a licensee should ''bring the matter to the attention of the Board.'' What process should a licensee use to notify the Board? If there is gross incompetence, the second half of this subsection mandates that an observing veterinarian file a complaint with the BPOA and this will bring the matter to the Board. However, if a veterinarian is exercising discretion in reporting incompetence under the first part of the subsection, there are no details about how to bring the matter before the Board. Should the veterinarian file a formal complaint with BPOA or would a letter to the Board suffice?

   Third, it is unclear when voluntary or mandatory reporting would apply to ''neglect or animal abuse.'' The subsection states that a veterinarian ''should'' report actions that ''demonstrate professional incompetence, ''neglect or animal abuse'' (Emphasis added). It also states:

If the conduct is grossly incompetent, or involves neglect or animal abuse, the veterinarian shall bring the matter to the attention of the Board by filing a complaint with the Bureau of Professional and Occupational Affairs. [Emphasis added.]

   If a veterinarian observes cases involving ''neglect or animal abuse'' by another veterinarian, is the observer mandated to report it to the Board or does the veterinarian have discretion? If the voluntary and mandatory provisions are both retained, the Board needs to clarify when a veterinarian is mandated to report conduct involving ''neglect or animal abuse'' and when reporting is voluntary.

Principle 3. Unprofessional conduct.

   There are several amendments, including a title change, to Principle 3. We have identified the following issues.

   First, we question the use of the word ''immoral'' in the opening paragraph of the amendments to Principle 3. A commentator suggested that the Board consider using the word ''unethical'' rather than ''immoral.'' We agree.

   The last sentence of Paragraph (3) uses the word ''should'' and reads: ''In these instances, the veterinarian should clearly note the reason for the surgery on the veterinary medical record of the animal.'' As we noted previously, the word ''should'' is nonregulatory language. We recommend that the word ''should'' in this sentence be replaced with ''shall'' in the final-form regulation.

   In Paragraph (5), what constitutes ''undue pressure'' or ''attempting to induce'' in trying to convince an individual to file, not file or withdraw a complaint? If a veterinarian and client find a way to amicably resolve their differences and the client withdraws the complaint before the Board takes action, did ''undue pressure'' or an inducement occur?

   Third, the new language in Paragraph (6) is unclear. The Pennsylvania Veterinary Medical Association (PVMA) asked the Board to ''develop parameters for what constitutes verbal abuse and harassment.'' In its comments dated April 18, 2007, the House Professional Licensure Committee (House Committee) questioned the application of this provision and whether it should be restricted to actions occurring while a veterinarian is practicing medicine. The Board needs to define, clarify and limit the breadth and scope of this provision in the final-form regulation.

   Fourth, the new Paragraph (7) generated questions for the PVMA. It asked: ''How is competence to perform determined?'' What level of training or experience is required to be competent in a medical procedure? The Board should include the standards that will be used to make this determination.

   Paragraph (8) states that ''making any false, misleading or deceptive statement or claim'' is ''unprofessional conduct or immoral conduct.'' Since such a claim or statement is already prohibited under the existing Principle 5 in Section 31.21, the need for this new language is unclear. If it is limited to verbal claims to a client, PVMA questions how it could be proven. It suggests a paper record signed by the client and documenting a discussion with the client of the benefits and risks of treatments and medical procedures. Does the new documentation proposed in a different rulemaking for Section 31.22(d) (noted in the Preamble) include the client's signature? The Board should explain how it intends to implement enforcement of this new code of conduct.

   Regarding Paragraph (9), a commentator questioned the impact of the rule on shelters or animal rescue groups where unlicensed people are often involved in providing medical care to animals. The Board should carefully examine the impact of this proposed regulation on volunteers or nonprofit organizations that seek to assist stray, unwanted or abused animals.

   Finally, in Paragraph (10), we share the questions and concerns noted by the House Committee and a commentator relating to standards, scope of practice and the laws and regulations in other states.

Principle 7. Veterinarian/client/patient relationships.

   Concerning Subsection (a)(1), a commentator questioned whether the regulation could be amended to recognize that a certified veterinary technician could assess, or provide ''triage'' for, the incoming emergency case and determine the appropriate action such as a referral to another facility. The final-form regulation should clarify the duty of a veterinarian in these situations.

   In Subsection (a)(2), what is a ''reasonable time?'' PVMA asked the Board to provide direction to veterinarians as to how much time they should give to a client to obtain necessary veterinary care for an animal from a different provider. The House Committee was concerned that this provision should include an affirmative duty to provide care until the time when another veterinarian may continue treatment. The final-form regulation should identify a minimum amount of time for this notice and also address the need for continuity and maintenance of medical care.

   The amendments to Subsection (b) appear minor but they raised two concerns.

   First, one revision generated financial concerns. The word ''should'' in the existing regulations was changed to ''shall.'' PVMA is concerned that this mandate places an undue burden on veterinarians. If they are required to care for animals without regard for costs including cases with no client or when a client has no money, then veterinarians, as small business owners, will be required to pass these costs onto other clients. PVMA also noted concerns for large animal veterinarians in cases that may involve services provided by the Department of Agriculture. Has the Board examined the potential fiscal impact of making this standard mandatory for veterinarians?

   Second, there was a concern as to whether the phrase ''ending suffering'' included euthanasia. If so, the House Committee suggested that the word euthanasia be included in Subsection (b). We agree.

   The House Committee expressed concerns with the use of the terms ''familiarize'' and ''familiar'' in the new Subsection (d). It characterized the use of these terms as setting a less stringent standard for requiring veterinarians to remain current with advancements in veterinary medicine. Veterinarians should strive to be competent in the application of existing treatments and in any advancement in medical treatment. The House Committee also noted similar concerns with the language in Subsection (f). The Board needs to explain and clarify its intent for the new Subsections (d) and (f).

   A commentator suggested revising the new language in Subsection (e) to include discussing the benefits, risks and side effects of ''treatments, preventatives and products dispensed to their clients.'' This type of language would give greater detail to the term ''treatment alternatives'' that used in the proposed regulation. The commentator also suggested that this discussion or explanation of the risks, benefits and side effects of treatment options should be documented. We agree.

Department of Revenue Regulation
#15-436
(IRRC #2596)

Pennsylvania Gaming Cash Flow Management

May 2, 2007

   We submit for your consideration the following comments on the proposed rulemaking published in the March 3, 2007 Pennsylvania Bulletin. Our comments are based on criteria in Section 5.2 of the Regulatory Review Act (71 P. S. § 745.5b). Section 5.1(a) of the Regulatory Review Act (71 P. S. § 745.5a(a)) directs the Department of Revenue (Department) to respond to all comments received from us or any other source.

1.  Economic or fiscal impact of the regulation.

   Section 5.2 of the Regulatory Review Act (RRA) (71 P. S. § 745.5b) directs this Commission to determine whether a regulation is in the public interest. When making this determination, the Commission considers criteria such as economic or fiscal impact and reasonableness. To make that determination, the Commission must analyze the text of the proposed rulemaking and the reasons for the new or amended language. The Commission also considers the information a promulgating agency is required to provide under § 745.5(a) in the regulatory analysis form (RAF).

   It is clear that there will be costs to the Commonwealth for the administration of this rulemaking. It is equally clear that there will be costs imposed upon the regulated community, especially as it relates to the reimbursement of Commonwealth expenses. However, the RAF does not provide any detail on what those costs are or will be. Without this information, we cannot determine if this proposed regulation is in the public interest. In the Preamble and RAF submitted with the final-form rulemaking, the Board should provide more detailed information required under § 745.5(a) of the RRA.

2.  Section 1001.3. Definitions.--Clarity.

   Credit against tax--This definition and § 1001.4(a), pertaining to calculations of credit against tax, implement Section 1209(c) of the Pennsylvania Race Horse Development and Gaming Act (Act) (4 Pa.C.S. § 1209(c)). We recommend that the definition be amended to include a reference to this section of the Act.

3.  Section 1001.5. Administration and distribution of moneys held by licensed gaming entities and the Commonwealth.--Statutory authority; Implementation procedures; Clarity.

Subsection (a)

   This subsection references ''any other fund as specified in this chapter.'' If any other funds are specified in this chapter, we recommend that they be identified in this subsection.

Subsection (b)(1)

   Deposits and transfers to Treasury by licensed gaming entities are the subject of this subsection. We have two recommendations. First, the term ''Office of the Budget'' is referenced in this subsection and Subsections 1001.8(c)(1) and 1001.10(d). The term ''Governor's Budget Office'' is referenced in Subsection 1001.8(b). We recommend that the term ''Office of the Budget'' be used and suggest that the term be defined.

   Second, under this subsection, licensed gaming entities will be required to transfer a certain amount of money to the Treasury Department ''as calculated by the CCS.'' In order to establish a binding norm on both the regulated community and the Department, we recommend that method of calculating the amount due be included in the final-form regulation. This could be achieved by referencing the various sections of the Act that relate to assessments.

Subsection (b)(5)(i)

   This subsection pertains to the annual minimum distribution as specified in Section 1403(c)(3) of the Act (4 Pa.C.S. § 1403(c)(3)). It states, in part, the following: '' . . . the required minimum shall be prorated for that portion of the municipality's fiscal year that the Board determines that the licensed gaming entity was actually in operation.'' Annual minimum distribution is defined as: ''Other than for a Category 3 license, 2% of the gross terminal revenue of the licensed gaming entity or $10 million, whichever is greater.''

   Representative Nickol, Minority Chairperson of the House Finance Committee, questioned the statutory basis for proration of the required minimum and whether this proration only applies to the first year of a licensed gaming entities operation. Sands Bethworks Gaming LLC (Sands Bethworks) also questioned the Department's authority to prorate the $10 million and asked how this provision will be implemented if the licensed gaming entity and the municipality operate under different fiscal years. We share these concerns and ask the Department to explain its statutory authority for the proration of the required minimum, the rationale behind it and the method of implementation.

Subsection (b)(5)(iii)

   One provision of this subsection states that the licensed gaming entity must remit required annual minimum distribution payments to the Department. Another provision states that distributions specified in the chapter must be made by the licensed entity to the Department or the respective municipality. When would a licensed gaming entity distribute money directly to a municipality? If distributions are not made from a licensed entity to a municipality, then the second provision should be deleted.

4.  Section 1001.6. Administration of amount deposited by licensed gaming entities with Treasury to pay Commonwealth gaming related costs and expenses ($5 million).--Statutory authority; Implementation procedures; Costs to the private sector; Adverse effects on competition; Policy decision of such a substantial nature that it requires legislative review; Clarity.

Subsection (d)

   This subsection states, in part, the following:

To fulfill the licensed gaming entity's obligations under this section, nothing prohibits the Board from drawing against any source of the licensed gaming entity, with the exception of any licensed gaming entity account that holds gross terminal revenue to be deposited with Treasury in accordance with § 1001.5.

   What authority does the Department have to allow or prohibit the Pennsylvania Gaming Control Board (Board) from taking a particular action? If the provision previous can be found in the Act, we question the need for including it in this rulemaking.

Subsection (e)(1)

   This subsection pertains to the assessment of expenses directly related to a particular licensed gaming entity. We have two concerns. First, the term ''periodic'' is used to describe when these assessments will be issued. This term is vague. The final-form regulation should be amended to include a specific time period relating to the issuance of these assessments by the Department.

   Second, this subsection states that the Department will issue assessments related to expenses incurred by the Board, Department, Office of Attorney General, the Pennsylvania State Police and any other Commonwealth entity charged with administrative duties under the Act. Section 1402(a) of the Act (4 Pa.C.S. § 1402(a)) allows the Department to recoup the costs incurred by the four agencies listed above. What is the Board's statutory authority for issuing assessments to recoup the costs of other state agencies? We note that the general term ''Commonwealth'' is used in §§ 1001.6(e)(2) and (3). Does this term mean any Commonwealth agency or just the four that are listed in the Act?

Subsection (e)(2)

   This subsection states that expenses incurred and assessed by the Commonwealth will be deducted from a licensed gaming entity's account as specified by Section 1401 of the Act. Section 1401(c) of the Act refers to weekly deposits. Will the assessments provide any detail on how the amounts due were calculated? Providing this level of detail would produce an open regulatory process that is viewed as fair. We recommend that the final-form regulation be amended to provide for detailed assessment notices that explain how amounts due were calculated.

Subsection (e)(3)

   Under this subsection, the general administrative costs of the Commonwealth not specifically assessed to a particular licensed gaming entity will be paid by each licensed gaming entity ''at the discretion of the Secretary.'' It is our understanding that the Department currently imposes a 1.5% assessment against each operating licensed gaming entity's gross terminal revenue. This assessment is issued and paid on a weekly basis. This current system of assessment is not codified in statute or regulation.

   We have four concerns. The Act provides little guidance on how the general administrative costs of the Board, the Department, the State Police and the Attorney General will be funded. We recognize that the primary intent of the Act is the protection of the public through the regulation and policing of all activities involving gaming in order to prevent practices that are unlawful (4 Pa.C.S. § 1102(a)(1)) and that adequate funding is necessary to carry out this objective. Because the protection of the public requires adequate funding and since the Act is vague on how this funding will occur, we believe that this regulation represents a policy decision of such a substantial nature that it requires further legislative input and direction. We urge the Department to consult and work closely with the General Assembly to gain a better understanding of legislative intent as this proposal goes forward.

   Second, Representative Nickol and two licensed gaming entities question the Department's statutory authority for providing such latitude to the Secretary of Revenue. We ask the Department to identify and justify its statutory authority for this provision.

   Third, we question what fiscal impact this provision will have on the regulated community. The broad language of the Act and this regulation make it impossible for licensed gaming entities to predict what costs they will incur and how those costs will be imposed. Without this knowledge, it will be difficult for a licensed gaming entity to effectively conduct its business.

   Finally, the provision in question has the potential to create an uneven playing field for all the licensed gaming entities. Using the current assessment system of 1.5% of gross terminal revenue as an example, licensed gaming entities that are currently open and paying the assessment could end up funding all of the general administrative costs of the four state agencies. Licensed gaming entities that have larger gross terminal revenues would have to subsidize the entities that have smaller gross terminal revenue. How will the Department implement an assessment system that is fair to all licensed gaming entities?

5.  Section 1001.8. State Gaming Fund transfers.--Statutory authority; Implementation procedures; Clarity.

Subsection (b)

   This subsection relates to the establishment of restricted receipt accounts. It gives the Governor's Budget Office the authority to establish restricted receipt accounts to facilitate the transfer of money to and from the State Gaming Fund. Similar to a concern noted previous, what authority does the Department have to allow or prohibit the Governor's Budget Office from taking a particular action? If the provision previously can be found in the Act, we question the need for including it in this rulemaking.

Subsection (c)

   Subsection (c) pertains to quarterly distributions to counties or municipalities. We have three concerns. First, this subsection provides details on how payments will be made to counties, but does not provide any details on how payments to municipalities should be made. This information should be added to the final-form rulemaking.

   Second, Subsection (c) references Management Directive 305.4 (relating to payments to counties). Subsection (c)(1) then provides more detail on how to remit payments to counties that appear to be addressed under Management Directive 305.4. If Management Directive 305.4 is amended, it will conflict with the instructions in Subsection(c)(1). We recommend that either the reference to the Management Directive or the detailed instructions found in Subsection (c)(1) be deleted.

   Third, Subsection (c)(2) states the following: ''The Department will determine the annual inflation adjustment and will publish notice of the inflation adjustment in the Pennsylvania Bulletin by January 1 of each year.'' We recommend that the final-form regulation specify what the Department is adjusting and how the adjustments will be calculated.

Subsection (d)

   This subsection addresses tax and credit against tax. Subsection (a) states that this section applies to the transfer of money to and from the State Gaming Fund. Do the provisions contained in Subsection (d) apply only to the transfer of money to and from the State Gaming Fund, or would they also apply to transfers involving the State Gaming Economic Development Tourism Fund and the Pennsylvania Race Horse Development Fund? If it applies to all of the Funds, then the final-form regulation should be amended accordingly.

Subsection (e)

   This subsection relates to the imposition of penalties. It states that the failure to transmit the required amount to '' . . . the Department's Collection Account or any other fund of the Commonwealth . . . '' (emphasis added) will result in the imposition of certain penalties. What is the Department's authority to impose penalties under this regulation for failure to transmit money to any fund except those related to gaming? We recommend that the Department either list the other funds or deleted the language noted above.

6.  Miscellaneous Clarity.

   *  Sections 1001.1, 1001.2 and 1001.5 note that this regulation establishes procedures for the administration and distribution of net slot machine revenue. The sections do not make reference to the collection of net slot machine revenue. We recommend that the sections be amended to note that this regulation also pertains to the collection of tax.

   *  The title to § 1001.5 Subsection (b) references deposits and transfers to Treasury by licensed gaming entities. Subsections (b)(5)(iii) and (iv) relate to distributions of local share assessments. To improve the clarity of the entire section, we recommend that Subsection (b)(iii) and (iv) be moved to a new Subsection (c).

ARTHUR COCCODRILLI,   
Chairperson

[Pa.B. Doc. No. 07-863. Filed for public inspection May 11, 2007, 9:00 a.m.]

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