NOTICES

INDEPENDENT REGULATORY REVIEW COMMISSION

Notice of Comments Issued

[41 Pa.B. 421]
[Saturday, January 15, 2011]

 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 agencies must consider these comments in preparing the final-form regulation. The final-form regulations must be submitted within 2 years of the close of the public comment period or it will be deemed withdrawn.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
7-462	Environmental Quality Board Commercial Fuel Oil Sulfur Limits  for Combustion Units 40 Pa.B. 5456 (September 25, 2010)	11/29/10	12/29/10
14-524	Department of Public Welfare Participation Review Process for Medical  Assistance Nursing Facilities 40 Pa.B. 6405 (November 6, 2010)	12/6/10	1/5/11

Environmental Quality Board

Regulation #7-462 (IRRC #2874)

Commercial Fuel Oil Sulfur Limits for
Combustion Units

December 29, 2010

 We submit for your consideration the following comments on the proposed rulemaking published in the September 25, 2010 Pennsylvania Bulletin. Our comments are based on criteria in Section 5.2 of the Regulatory Review Act (RRA) (71 P. S. § 745.5b). Section 5.1(a) of the RRA (71 P. S. § 745.5a(a)) directs the Environmental Quality Board (EQB) to respond to all comments received from us or any other source.

1. General concerns relating to the Regulatory Review Act criteria of Economic impact or fiscal impacts of the regulation which include the following:

 • Direct and indirect costs to the Commonwealth, to its political subdivisions and to the private sector;

 • Adverse effects on goods and services, productivity or competition;

 • Nature of required reports, forms or other paperwork;

 • Feasibility;

 • Need for the regulation;

 • Reasonableness;

 • Implementation procedures;

 • Timetables for compliance; and
Policy decision of such a substantial nature that it requires legislative review.

 Under Paragraphs (2) of Subsections (a) through (e), sulfur limits will be established for combustion units as of May 1, 2012, as follows:

 • 15 ppm sulfur for No. 2 and lighter commercial fuel oil,

 • 0.25% sulfur for No. 4 oil, and

 • 0.5% sulfur for Nos. 5, 6, and heavier oil.

 These requirements apply to the following subsections in Section 123.22:

 (a) Nonair basin areas.

 (b) Erie; Harrisburg; York; Lancaster; and Scranton, Wilkes-Barre air basins.

 (c) Allentown, Bethlehem, Easton, Reading, Upper Beaver Valley and Johnstown air basins.

 (d) Allegheny County, Lower Beaver Valley, and Mo- nongahela Valley air basins.

 (e) Southeast Pennsylvania air basin.

 The following comments apply to each provision in Subsections (a) through (e).

Compliance date of May 1, 2012

 Senator Mary Jo White, Chairman of the Senate Environmental Resources and Energy Committee (Senate Committee Chairman White) commented that this rulemaking, at the earliest, would not be complete until the summer of 2011 which would allow less than a year to comply. Several refineries commented that compliance by May 1, 2012, will not allow sufficient lead time to allow them to meet the requirements. They cite concerns that the transition requires financing, capital planning, engineering design, environmental permits, construction and startup of the upgraded refining process. Other commentators expressed concern that the compliance date could affect the overall supply of fuel oil, resulting in price increases of diesel truck fuel and home heating fuel. Commentators also cited what they consider to be more reasonable limits and timeframes used by New Jersey. These refineries, as well as other commentators, request at least a four year lead time to comply. The EQB should explain why the compliance date in the final-form regulation is reasonable and the effect on the supply and price of the fuels directly listed in the regulation, as well as other fuels derived from the same source.

Limit of 15 ppm sulfur for No. 2 and lighter commercial fuel

 Some commentators support the 15 ppm limit, stating it will provide a better environmental benefit. However, several commentators suggest that 500 ppm is more realistic and would allow efficiency in fuel blending that 15 ppm would not allow. Senate Committee Chairman White commented that a more realistic approach is to consider 500 ppm, which would still amount to a nearly 90% sulfur content reduction. We recommend that the EQB review the 15 ppm limit, and in the final-form regulation explain how the limit used in the final-form regulation recognizes the efficient operation of refineries while addressing the need to protect the environment.

Limit to 0.5% sulfur for No. 5, No. 6 and heavier oil

 Two refinery commentators (The National Petrochemical and Refiners Association and ConocoPhillips) state that sulfur removal from heavy fuel oils is technologically difficult, very costly and usually economically cost prohibitive. These commentators state that the market reality of the limit to 0.5% sulfur for these fuels is that they will export them rather than make the investments required to meet the 0.5% limit. We are concerned that the regulation may disrupt the supply of these fuels in Pennsylvania. The EQB should review the 0.5% limit and explain why the impact of the limit in the final-form regulation is needed, reasonable and cost-effective.

Limit to 0.25% sulfur for No. 4 oil

 In regard to the 0.25% sulfur limit for No. 4 oil, we request the same evaluation of this limit in the final-form regulation as requested above relating to No. 5, No. 6 and heavier oil. The EQB should review the 0.25% limit and explain why the impact of the limit in the final-form regulation is needed, reasonable and cost-effective.

Supply and indirect costs

 Senate Committee Chairman White is concerned that Pennsylvania homeowners who rely on home heating fuel could be impacted by the price and availability of fuel. Commentators believe the regulation could disrupt the overall supply of fuel. They cite concern that the timing and sulfur limits could translate into a higher price for on-road diesel fuel and price spikes for home heating oil. One commentator estimates the regulation could add 20 to 30 cents per gallon to the cost of fuels. The EQB should provide with the final-form regulation submittal an analysis of the impact of the regulation on both the fuels directly included in the regulation and other fuels derived from the same sources, including an analysis of the supply and demand for the fuels and the effect of the regulation on the availability and price of these fuels.

Temporary suspension mechanism

 Subparagraphs (2)(iii) of Subsections (a) through (e) include the following:

 (iii) The Department, with the written concurrence of the Administrator of the EPA [Environmental Protection Agency], may temporarily suspend or increase the applicable limit or percentage by weight of sulfur content of a commercial fuel oil set forth in the table in subparagraph (i) if both of the following occur:

 (A) The Department determines that an insufficient quantity of compliant commercial fuel oil is reasonably available in a nonair basin area.

 (B) The Department receives a written request for a suspension or increase on the basis that compliant commercial fuel oil is not reasonably available. The request must include both of the following:

 (I) The reason compliant commercial fuel oil is not reasonably available.

 (II) The duration of time for which the suspension or increase is requested and the justification for the requested duration.

 We request an explanation of how the temporary suspension mechanism will be effective in addressing a shortage of compliant fuel. The regulation is not clear regarding what process will be followed, when the EPA would complete its review, the content required by the EPA to grant the request or whether the EPA is required to entertain the request. We question how an excessive price for compliant fuel would be considered in the determination of whether compliant fuel is ''available.'' Also, what alternatives would the Department have if the EPA refuses to entertain the request or denies the request? The EQB should explain how this mechanism is feasible, reasonable and in the best interest of Pennsylvania.

Policy decision of such a substantial nature that it requires legislative review

 It is clear that this regulation has direct and indirect effects on a broad range of citizens, businesses and industry. Several comments were received in support of the regulation, even by those who may oppose portions of the regulation. We also recognize from the concerns expressed in the public comments, Senate Committee Chairman White's comments and our concerns included above that this regulation involves the availability of fuel, the price of fuel, significant economic investment and approval of temporary suspensions by the EPA that may affect the economic interests of all of Pennsylvania. Therefore, the EQB should seek the advice of the legislature on whether this regulation represents a policy decision of such a substantial nature that it requires legislative review.

2. Subsection 123.22(f) Sampling and testing.—Reasonableness; Duplication of requirements.

 Two commentators believe the requirements for sampling and testing are unwarranted and may require re-testing of fuels. The EQB should explain why the sampling and testing requirements are needed and would not result in excessive or repetitive sampling and testing of fuels.

Department of Public Welfare

Regulation #14-524 (IRRC #2880)

Participation Review Process for Medical Assistance Nursing Facilities

January 5, 2011

 We submit for your consideration the following comments on the proposed rulemaking published in the November 6, 2010 Pennsylvania Bulletin. Our comments are based on criteria in section 5.2 of the Regulatory Review Act (RRA) (71 P. S. § 745.5b). Section 5.1(a) of the RRA (71 P. S. § 745.5a(a)) directs the Department of Public Welfare (Department) to respond to all comments received from us or any other source.

1. Economic or fiscal impact of the rulemaking.

 In the Regulatory Analysis Form (RAF), the Department has stated that the costs/savings imposed by the rulemaking for the regulated community, local government and state government will be equivalent to the costs associated with a current Statement of Policy. What are the costs associated with the Statement of Policy?

 In addition, we ask the Department to complete all parts of Section 20 of the RAF. This section asks for an estimate of the fiscal savings and costs associated with implementation and compliance for the regulated community, local government and state government for the current year and five subsequent years.

2. Section 1187.162. Definitions.—Need; Clarity.

 We have two concerns with the definition of ''closed-campus CCRC.'' First, what is meant by the phrase ''same campus''? Does the nursing facility component of the closed-campus CCRC have to be located within a specific distance of the independent living units?

 Second, what is the need for Paragraph (iii) which states, ''The CCRC does not market its nursing facility component directly to the general public''?

3. Section 1187.172. Contents and submission of bed requests.—Need; Reasonableness; Clarity.

 Subsections (a)(4)(iii)(C) and (D) use the phrase ''imposition of remedies.'' What is meant by this phrase? Why must an applicant provide information to the Department about the ''imposition of remedies''? As suggested by a commentator, we believe it would be more reasonable if the provisions focused on violations that lead to the imposition of fines instead of the ''imposition of remedies.''

4. Section 1187.173. Review and public process relating to bed requests.—Implementation procedures; Clarity.

Subsection (a)

 Subsections (a)(1) and (2) state that ''the Department will use its best efforts'' to issue decisions within a certain time frame. This language is non-regulatory because it does not establish a binding norm. We recommend that it be deleted from the final-form regulation.

Subsection (c)

 This subsection allows for an expedited review for a bed request for ''good cause'' as determined by the Department. A commentator has asked what criteria will be used to determine if an expedited review is appropriate. We believe the regulated community would benefit from knowing what criteria will be used to determine ''good cause'' and ask the Department to include the criteria in the final-form regulation.

Subsection (d)

 The publication of and public comment period for bed requests is addressed by this subsection. Subsections (d)(1), (d)(2) and (d)(3) state that certain information will be posted online by the Department. Will the information be posted to the Department's website or on a different website? This should be clarified in the final-form regulation

 In addition, a commentator has suggested that any comments submitted during the comment period be made available to the public. Has the Department considered posting comments it receives on its website?

5. Section 1187.174. Information and data relevant to bed requests.—Need.

 This section lists other information the Department may consider when reviewing applications for bed requests. A commentator has questioned why the Department would consider data relating to the availability of home and community based services and data relating to admissions and discharges at Medical Assistance (MA) nursing facilities in the primary service area identified in the bed request. What is the need for this data in evaluating a bed request?

6. Section 1187.175. Criteria for the approval of bed transfer requests.—Policy decision of such a substantial nature that it requires legislative review; Need; Reasonableness; Clarity.

Subsection (a)

 A commentator is concerned that the criteria included in this section would limit a provider's ability to make changes to a facility in response to consumer demand. Another commentator believes that the criterion found under Subsection (a)(7), which states, ''Approval of the bed transfer request will not result in increased costs to the MA program'' will benefit Pennsylvania's Medicaid budget, but no MA consumers. While we understand and appreciate the budgetary constraints facing the Department, we ask for further explanation of how this set of criteria benefits MA consumers.

Subsection (b)

 This subsections lists two conditions that could lead to the denial of a bed transfer request even if the criteria specified in Subsection (a) are met. The condition found in Subsection (b)(1) states: ''Approval of the request would negatively affect the Department's goal to rebalance the Commonwealth's publicly-funded long-term living system to create a fuller array of service options for MA recipients.'' We question if this goal is a policy decision of such a substantial nature that it requires legislative review and ask the Department to point to specific statutory language that would support this goal. We also ask the Department to explain what criteria will be used to make this determination. We note that similar language can be found in § 1187.176, pertaining to criteria for the approval of closed-campus CCRC bed requests and § 1187.177, pertaining to criteria for the approval of bed requests other than bed transfer requests for closed-campus CCRC bed requests.

7. Section 1187.176. Criteria for the approval of closed-campus CCRC bed requests.—Need; Reasonableness.

 This section establishes criteria for the approval of closed-campus CCRC bed requests. We have two concerns. First, what is the need for separate criteria for CCRC bed requests compared to non-CCRC bed requests? This should be explained in the Preamble to the final-form regulation.

 Second, Subsection (a)(4) requires the ratio of CCRC's independent living units to its nursing facility beds to be ''equal to or less than 17 independent living units to 1 nursing facility bed.'' We ask the Department to explain the basis for this ratio.

8. Section 1187.177. Criteria for the approval of bed requests other than bed transfer requests or closed-campus CCRC bed requests.—Statutory authority; Need; Reasonableness; Implementation procedures.

 We have concerns with three subsections. First, a commentator believes that Subsection (a)(3)(ii) places an unreasonable burden on nursing facilities because it will impose an artificial application of a mandated percentage of MA residents. What is the need for this criterion?

 Second, Subsection (a)(3)(iv) states the following: ''The legal entity will employ welfare or MA recipients in its subject facility.'' We have the following questions about this provision.

 • What is the Department's specific statutory authority for this provision?

 • How will it be implemented?

 • Would part-time employment satisfy this requirement?

 • What would happen if the legal entity cannot find a qualified candidate to employ?

 • Can this provision be waived, and if so, under what circumstances?

 • How will it be enforced and what are the penalties for not being in compliance?

 Third, we ask the Department to explain how it determined that the numeric percentages relating to average annual occupancy rates found in Subsections (b)(1) and (2) are appropriate and reasonable.

SILVAN B. LUTKEWITTE, III, 
Chairperson

[Pa.B. Doc. No. 11-91. Filed for public inspection January 14, 2011, 9:00 a.m.]

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