RULES AND REGULATIONS

Title 49—PROFESSIONAL AND VOCATIONAL STANDARDS

STATE BOARD OF AUCTIONEER EXAMINERS

[ 49 PA. CODE CH. 1 ]

Fees

[52 Pa.B. 7681]
[Saturday, December 10, 2022]

 The State Board of Auctioneer Examiners (Board) and the Acting Commissioner of the Bureau of Professional and Occupational Affairs (Acting Commissioner) amends Chapter 1 (relating to State Board of Auctioneer Examiners) by amending § 1.41 (relating to schedule of fees) to read as set forth in Annex A.

 This final-form rulemaking increases application fees to reflect updated costs of processing applications and increases all the Board's biennial renewal fees to ensure its revenue meets or exceeds the Board's current and projected expenses. This final-form rulemaking increases the following application fees on a graduated basis: auctioneer, apprentice auctioneer, auction company, trading as-sistant, trading assistant company, special license and course of study. Approximately 141 applicants are impacted annually by the increased application fees.

 The Board is also increasing the graduated biennial renewal fees for the following licenses and registrations: auctioneer, apprentice auctioneer, auction company, trading assistant and trading assistant company. There are approximately 2,437 individuals who possess current licenses and registrations issued by the Board who are required to pay more to renew their licenses or registrations.

Effective Date

 This final-form rulemaking is effective upon final-form publication in the Pennsylvania Bulletin. The initial increase for application fees will be implemented immediately upon publication. Thereafter, the subsequent graduated increases for application fees are implemented on a 2-fiscal-year basis on July 1, 2025, and July 1, 2027.

 The increased biennial renewal fees are implemented for the March 1, 2023—February 28, 2025, biennial renewal period. Thereafter, the subsequent graduated increases are implemented for the March 1, 2025—February 28, 2027, biennial renewal period and then again for the March 1, 2027—February 28, 2029, biennial renewal period, and thereafter.

Statutory Authority

 Under section 6(a) and (b) of the Auctioneer Licensing and Trading Assistant Registration Act (act) (63 P.S. § 734.6(a) and (b)), the license and examination fees and all other fees imposed under the provisions of this act shall be fixed by the Board by regulation and shall be subject to review in accordance with the Regulatory Review Act (71 P.S. §§ 745.1—745.14). If the revenues generated by fees, fines and civil penalties imposed in accordance with the provisions of this act are not sufficient to match expenditures over a 2-year period, the Board shall increase these fees by regulation, subject to review in accordance with the Regulatory Review Act, that the projected revenues will meet or exceed projected expenditures. If the Bureau of Professional and Occupational Affairs (Bureau) determines that the fees established by the Board are inadequate to meet the minimum enforcement efforts required, then the Bureau, after consultation with the Board, shall increase the fees by regulation, subject to review in accordance with the Regulatory Review Act, that adequate revenues are raised to meet the required enforcement effort. In addition to the previous cited authority, other sections of the act support the Board's authority to amend its fees by regulation when necessary.

 Section 32 of the act (63 P.S. § 734.32) provides that ''[t]he board may adopt rules and regulations necessary for the proper administration and enforcement of this act.'' Section 33(a) of the act (63 P.S. § 734.33(a)) provides that ''[a]ll fees fixed pursuant to section 203 of the act of July 1, 1978 (P.L. 700, No. 124), known as the Bureau of Professional and Occupational Affairs Fee Act, shall continue in full force and effect until changed by the board.'' Regarding fees for trading assistant registration, the act of October 8, 2008 (P.L. 1080, No. 89) (Act 89 of 2008) established trading assistant registration by adding section 10.1. Section 10.1(c) specifically required that a registration fee of $100 be included with each application for registration. When the act was amended by the act of July 20, 2016 (P.L. 789, No. 88) (Act 88 of 2016), it added section 5.1 requiring trading assistants and trading assistant companies to register with the Board and repealed section 10.1. Section 5.1(c) of the act (63 P.S. § 734.5.1(c)) established an initial $100 registration fee for trading assistants and trading assistant companies and expressly added the new language of allowing the Board to establish this fee by regulation. According to the fiscal notes for Act 88 of 2016 from the House and Senate Appropriations Committees, the statutory fee of $100 for the registration and renewal of trading assistants established by section 10.1 was deleted and section 5.1(c) provided language giving the Board the authority to increase this fee for both trading assistants and trading assistant companies when needed to increase its revenue. Here, section 5.1 expressly provides the authority for the Board to establish this fee by regulation and with the other sections of the act cited previously provides the Board with the authority to amend this initial fee by regulation when necessary.

 The Commissioner is appointed by the Governor and has a number of powers and duties. Specifically, under section 810(a)(7) of The Administrative Code of 1929 (71 P.S. § 279.1(a)(7)), the Commissioner has the power and duty, ''[u]nless otherwise provided by law, to fix the fees to be charged by the several professional and occupational examining boards within the department.''

Background and Purpose

 Under section 6(a) of the act, the Board is required to support its operations from the revenue it generates from fees, fines and civil penalties. The act further provides that the Board shall increase fees when expenditures outpace revenue. Most of the general operating expenses of the Board are borne by the licensee population through revenue generated by the biennial renewal of licenses. A small percentage of its revenue comes from application fees, fines and civil penalties.

 In January of 2021, the Board voted to increase its renewal and application fees based on its review of incoming revenue and biennial expenses. The Board's Fee Increase Report showed summaries of the Board's revenue and expenses for Fiscal Years (FY) 2018-2019 and 2019-2020 and the projected revenue and expenses through FY 2023-2024. During FYs 2018-2019 through 2019-2020, the Board received biennial revenue of $589,612.09, incurred expenses of $651,142.11 and ended with a deficit of $276,136.32. For FYs 2020-2021 and 2021-2022, the Board anticipates receiving biennial revenue of $571,000 and anticipates incurring expenses of $667,000. At the end of FY 2020-2021, the Department of State's Bureau of Finance and Operations (BFO) anticipates a deficit balance of $372,136.22. For FYs 2022-2023 and 2023-2024, with the implementation of this fee increase, the Board projects receiving biennial revenue of $890,000 and projects incurring expenses of $687,000, ending with a deficit of $169,136.32. The BFO's data demonstrated that the Board was not able to meet expenditures over a 2-year period and recommended a fee increase.

 The proposed rulemaking for the fee increase was published at 52 Pa.B. 1736 (March 26, 2022) for review and comment. Publication was followed by a 30-day public comment period during which the Board received no public comments. The Senate Consumer Protection/Professional Licensure Committee (SCP/PLC) did not submit any comments. The House Professional Licensure Committee (HPLC) and the Independent Regulatory Review Commission (IRRC) submitted comments as detailed as follows.

 Since the proposed rulemaking was published, the Board continues to be in a deficit, and it continues to increase as anticipated by the BFO.

Summary of Comments and the Board and Commissioner's Response

 In preparing this final-form rulemaking, the Board considered all comments submitted by the HPLC and IRRC.

HPLC comment regarding potential impact of the fee increase

 The HPLC questioned the Board regarding the potential impact the regulation could have on this Commonwealth's ability to compete with other states because the proposed increase to the fees for initial licensure and renewal for auctioneers are significantly higher than surrounding states that license auctioneers. IRRC shared the same concern.

 The Board and the Acting Commissioner find that the increases in fees for initial licensure and renewal for auctioneers are necessary to equate for the rising costs associated with reviewing and processing the initial applications and to help continue the Board's mission of providing public protection through licensure of the profession and the enforcement of the act. As described in detail as follows, the increase in the initial application fees will not deter applicants from applying for licensure in this Commonwealth or put this Commonwealth at a competitive disadvantage. Also, increasing initial application fees to cover the cost of processing those applications will lessen the burden on existing licensees regarding biennial fee increases. Adjusting the initial application fees to cover the costs of applications is a fair and equitable approach because existing licensees will not have to bear all of the burden of initial applicant costs through higher biennial licensure fee increases. Unfortunately, the increases to the initial application fees are not sufficient to alleviate the Board's financial deficit so the Board's decision to increase the renewal fees for licensure, albeit at a lower amount than if the initial application fees were not increased, is also needed. The Board does not believe that the increase of these fees will put the Commonwealth at a competitive disadvantage as outlined as follows.

 In comparing professional licensing in this Commonwealth to states in the Northeast Region (Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Ohio, Rhode Island, Vermont and West Virginia), about half of the states regulate auctioneers to varying degrees. Some only require them to register as a business for tax purposes; others require auctioneers to be licensed. Pennsylvania, Maine, Massachusetts, New Hampshire, Ohio, Vermont and West Virginia are the only states in the Northeast Region that license auctioneers. In comparing this Commonwealth's current application fee of $50 to the other states, it is well below what the other states currently charge. For the new initial application fee of $180, that fee is still lower than some of the other states and well within the range of fees among states. Maine has a license period of 1 year and requires an application fee of $271; Massachusetts and West Virginia each have a license period of 1 year and require an application fee of $100. New Hampshire and Ohio each have a license period of 2 years like the Commonwealth and require an application fee of $200; Vermont has a license period of 2 years and requires an application fee of $100. Therefore, while the initial application fee increase from $50 to $180 represents an increase for the Commonwealth, the increase itself is actually just bringing the Commonwealth closer to the average application fees for auctioneers being charged by the surrounding states. Thus, the Board does not believe the application fee increase will put the Commonwealth at a competitive disadvantage.

 In addition to being a fair and necessary increase in fees, professional licensure provides assurance to the consumers that the auction being conducted is being done so in accordance with the law. This is important and works as a competitive advantage for the Commonwealth over the states that do not license the profession. Furthermore, the Commonwealth is the fifth largest state by population based on the 2020 United States Census so there is more opportunity here for auctioneers to conduct a profitable business. As such, the Board finds that an increase in fees would not put the Commonwealth at a competitive disadvantage.

 In comparing this Commonwealth's biennial renewal fee for auctioneers of $400 (effective with the 2023—2025 biennial renewal), Maine has an annual renewal of $200, Massachusetts has an annual renewal of $100 and West Virginia has an annual renewal of $50. New Hampshire and Ohio each have biennial renewals of $200 and Vermont's fee is $240. While the Board's biennial renewal fee for auctioneers is higher than other states, the Board does not believe it will make this Commonwealth less competitive as compared to other states. As stated earlier, because of the large population size and the fact that this Commonwealth conducts more auctions per year than the smaller surrounding states, the Board does not believe an increase of $140 (equating to $70 per year over 2 years) will deter licensees from practicing in this Commonwealth or put this Commonwealth at a competitive disadvantage.

IRRC comments

 IRRC asked the Board to explain how the proposed application and biennial renewal fees were calculated and how it determined that the proposed fee increases to be implemented during the first phase, including those for applications and renewals for the five categories of licenses, are both appropriate and reasonable. IRRC also asked the Board to explain how the implementation schedule, particularly the first phase, is reasonable. IRRC also asked the Board to provide in this final-form rulemaking additional information and updates in the Regulatory Analysis Form (RAF).

Calculation of application and renewal fees; reasonableness of fee increases

 IRRC asked the Board to detail how the proposed application fees, to be implemented during the first phase, were calculated. Boards and commissions under the Bureau calculate and design initial application fees to cover the cost to process applications. Application fees are based on time study reports created within the Bureau that lay out each step in processing an application and the amount of time it takes to complete each step. That amount of time per application is multiplied by the total number of anticipated application requests for 1 year to get the total number of minutes per year necessary to process applications. (The number of minutes per year is multiplied by two since the increases are biennial.) Initial application fees are based on a formula that multiplies the number of minutes to perform the processing function by the pay rate for the classification of the personnel performing the function and adding a proportionate share of administrative overhead. The corresponding fee report forms for each application fee describe in detail how the fees are calculated. For example, the application fee for an auctioneer license is calculated by taking the cost of 1 hour of clerical staff time to review the application and 1 hour of the clerical supervisor's time for review and sign off and then finally 1 hour of the Board's administrator's time to process the application along with standard administrative overhead costs to achieve a total cost. The Board finds that the fee increases are reasonable based on the fees charged by the neighboring states and are appropriate based on the fee report forms that outline the costs to the Board to review and process the applications.

 As reflected in Annex A, the application fees would increase on a graduated level for the licenses and registrations for auctioneer, apprentice auctioneer, auction company, trading assistant and trading assistant company. The application fees will be increased on a graduated basis so that the application fees collected during each biennium reflect the anticipated costs of processing applications for that biennium. These fees are designed to cover the cost to process applications and are borne by individual applicants. Application fees for FY 2021-2022 are based on the time study reports created within the Bureau giving each step in the process and the amount of time it takes to process one application. That amount is multiplied by the anticipated application requests for 1 year (times two since the increases are biennial). Increases effective July 1, 2025, and July 1, 2027, are calculated at a 9.5% increase based upon raises under current Commonwealth union contracts. Application fees are almost entirely dependent upon personnel-related costs.

 IRRC also asked the Board to explain how it calculated the fee increases for biennial renewal of licenses for auctioneer, apprentice auctioneer, auction company, trading assistant and trading assistant company which will take effect beginning with the March 1, 2023, March 1, 2025, and March 1, 2027 biennium renewal periods. Biennial renewal fees were calculated by the BFO using the Board's revenues and expenses while using past histories of prior fee increases as well as changes in the licensee population as a guide in determining the graduated fee increases. The Board last increased its fees in 2015 and based on those fees if left unchanged the Board's current deficit would continue to grow. The biennial fee increases are calculated to ensure that the projected revenues will meet or exceed projected expenditures, as required by the act. In calculating the new renewal fees, the BFO considered the licensure population and adjusted the current biennial renewal fees upward to an amount that would put the Board back on stable financial footing by the end of the 2027 renewal cycle.

 IRRC asked the Board to explain how it determined that the proposed fee increases to be implemented during the first phase, including those for applications and renewals for these five categories of licenses, are both appropriate and reasonable. As indicated previously, the first fee increase for application fees are calculated to cover the cost to process applications. This initial increase brings the application fee in line with the cost to process the applications. Because application fees are almost entirely dependent upon personnel-related costs, the subsequent increases effective July 1, 2025, and July 1, 2027, are calculated at a 9.5% increase based upon raises under current Commonwealth union contracts. Thus, moving forward, the Board anticipates that the subsequent increases will cover future costs to process applications. In determining the biennial renewal fees, the BFO calculated the increase needed to allow the Board to meet its operational costs while also reducing the accumulated deficit in the most efficient manner. Most of the Board's operational costs are personnel-related, and much of those costs are not within the Board's control. Staff are generally employees of the Commonwealth, most of whom are civil service personnel; many are in union positions. For these employees, the Board is bound by the negotiated contract. Personnel costs associated with investigation and enforcement depend largely on the number of complaints received that need to be investigated, and the number of those matters that result in disciplinary action. The Board has no control over the number of complaints that are filed against licensees and unlicensed individuals, nor may they control which matters are, or are not, prosecuted. The BFO also considered and incorporated the projected increases in initial application fees that could be used to help reduce the deficit by bringing those costs into alignment with the actual costs required to process the applications. Furthermore, it was noted that increases in expenses have steadily rose over the last few years. Some of the increase in expenses is simply due to personnel cost of living increases over time. However, over the last few fiscal years, the Board has had some sizable increases to expenses for a variety of reasons.

 One of the largest financial impacts for the Board was the incorporation of The Pennsylvania Justice Network (JNET), due in part to the enactment of the act of February 15, 2018 (P.L. 14, No. 6) (Act 6 of 2018), which requires mandatory self-reporting of criminal convictions. The Board uses JNET to identify criminal convictions of licensees and to verify compliance with Act 6 of 2018's mandatory reporting requirement. There was a sizable increase in the number of complaints being processed and opened for prosecution. The additional complaints resulted in increased expenses due to higher prosecutions, investigations, expert witness usage and hearings. Since incorporation of JNET, expenses have increased steadily in all of these cost categories.

 In addition to the legal expense increases, the 29 boards and commissions under the Bureau have undergone an information technology transformation upgrade with the incorporation of the Pennsylvania Licensing System (PALS). Expenses associated with PALS, including the initial build as well as ongoing maintenance, are proportionately spread across all entities based on licensee population to effectively share costs per licensee. While the initial build is in the past, it has contributed to higher administrative expenses for all boards during the last few fiscal years. Due to PALS' high functioning database with enhanced features over the Bureau's previous License 2000 platform, maintenance for this system requires a larger financial commitment from all boards and commissions than the previous system. As detailed in the BFO's Fee Increase Report, these costs were also considered in calculating the renewal fee increase.

 As noted previously in answering the comment received from the HPLC, because the application fees were calculated based on the current rates for processing auctioneer applications and they are in line with the other states' application fees, the Board finds them to be reasonable. The same applies to the renewal fees for auctioneers.

 For apprentice auctioneers, the Commonwealth, Ohio and West Virginia are the only states in the Northeast Region that license apprentice auctioneers. In comparing the Commonwealth's application fee of $145, Ohio and West Virginia each have an application fee of $100. The Commonwealth's biennial renewal fee of $200 (effective with the 2023—2025 biennial renewal) is comparable to annual rates for Ohio at $100 and West Virginia at $100.

 The Commonwealth is the only state in the Northeast Region that licenses an auction company. Ohio licenses an auction corporation, partnership or association but not a company. The Commonwealth's application fee of $120 in 2023, $135 in 2025 and $150 in 2027 is comparatively lower than Ohio's application fee of $200 for an auction corporation. The Commonwealth's biennial renewal fee of $400 (effective with the 2023—2025 biennial renewal) is comparatively higher than Ohio's biennial renewal fee for an auction corporation at $200, but the Board does not believe that this would put the Commonwealth at a competitive disadvantage because the Commonwealth is the only state in the region that licenses auction companies. Ohio's licensure differs from the Commonwealth's in that it requires that at least 50% of the owners of an auction corporation, partnership or association also have an auctioneer's license. The Commonwealth's auction company license does not require this and as such, holds an advantage over Ohio's due to the lack of that ownership element. The Commonwealth's license only requires that an auctioneer of record be on file with the auction company and that person does not have to be an owner. Thus, it is easier for more auction type companies to do business in this Commonwealth as opposed to the neighboring states which is a competitive advantage. Thus, charging a higher fee than Ohio should not put the Commonwealth at a competitive disadvantage.

 A license is not required by any other comparison state in the Northeast Region for trading assistants and trading assistant companies. Trading assistants and trading assistant companies are licenses granted to those individuals looking to sell other people's property using only an online auction format and not an in-person auction. Having a licensure requirement to conduct online only auctions without having to have a full auctioneer's license is a competitive advantage for the Commonwealth because it allows more individuals to engage in this business, while providing the security of accountability that is provided through the licensure of professionals. The Commonwealth is the only state in the region that issues these types of licenses; therefore, the Board does not anticipate that the fee increase will put the Commonwealth at a competitive disadvantage.

Reasonableness of the implementation schedule

 IRRC asked the Board to explain how the implementation schedule, particularly the first phase, is reasonable. The Board and the Acting Commissioner submit that the graduated application fee increases are appropriate and reasonable because the increased fees are projected to cover the cost to process the applications for that biennial period. The Board carefully considered the best way to implement an increase in application fees and determined that a graduated fee schedule is favorable because it aligns the actual cost to process applications in each biennial period with the fee for that period. While the Board is reluctant to put additional fiscal burdens on its applicants, the increased fees are not significant when looking at the total increase in dollars. Moreover, even with the implementation of the graduated application fee increase, the Board's fees are still comparable with other states.

 The Board and the Acting Commissioner further submit that the graduated increases to the biennial renewal fees are also appropriate and reasonable based on the BFO's calculations. Significantly, the Board has not increased its fees since 2015. These needed increases are appropriate because they are necessary to ensure revenues meet or exceed expenses, as required by the act. Currently the Board has had a steady increase in its expenses, while its revenues have remained stagnant which has created a sizable deficit. The biennial renewal fee increases were calculated to reduce the deficit as quickly as possible. Therefore, the initial increase had to be higher. However, because the initial fee increase would not totally eliminate the Board's deficit, there was a need to implement additional smaller increases for the following renewal cycles. The needed biennial renewal fee increases are reasonable because they are made on a graduated basis to reduce the impact to the licensee population, while also allowing the Board to meet or exceed its projected expenditures to put the Board back on firm financial ground in the most efficient manner possible.

 The Board submits that the implementation schedule is reasonable based on the current financial circumstances of the Board. Currently, the Board's expenses are exceeding its revenues and while the Board can continue to do business through its reliance on dollars from the Professional Licensure Augmentation Account (PLAA), where the 26 licensing boards under the Department of State deposit revenue; the Board cannot rely on PLAA funds to address its growing deficit. Thus, the Board has implemented a graduated fee schedule to reduce its deficit in the most efficient manner while lessening the immediate burden to applicants and the licensee population that would occur with a flat fee increase. While applicants and licensed individuals will be impacted economically, the graduated increases, as opposed to a flat fee increase, will ensure that fees charged coincide more closely with the projected expenses for each biennium.

 The Board finds that the implementation schedule for the application fees is reasonable and fair because the graduated application fee increases are designed to reflect the anticipated costs of processing applications for that biennium.

 Additionally, the Board finds that the implementation schedule for the biennial renewal fees is also reasonable. As noted previously, the need for the increased revenue through biennial renewal fees is necessary because the Board's expenses have increased based on the increase in complaints being filed because of the Board's use of JNET and the resulting increase in expenses due to higher prosecutions, investigations, expert witness usage and hearings. More than likely, this new level of legal workload will be part of the financial picture for the Board going forward so any delays in implementing new fees will push the Board into a larger deficit. Furthermore, the Board continues to pay for the administrative expenses involving the upgrade to PALS and will continue to pay ongoing expenses in the form of yearly maintenance costs for the foreseeable future. Thus, the Board's decision to implement the graduated biennial renewal fee schedule is reasonable based on its current financial position and the need to implement the higher fees in a manner to reduce its deficit in a quick and efficient manner to return the Board to a financially stable environment.

Updates to the RAF

 Finally, IRRC asked the Board to update the RAF to include a dollar estimate in its response to RAF question # 21 for the cost to implement the regulation or explain why it is not possible to do so; to elaborate on any alternative regulatory provisions in response to RAF question # 26, which the Board considered and rejected; to provide fee report forms provisions in response to RAF question # 28 for the fees described herein; and to delete any meeting dates provisions in response to RAF question # 30 that have passed. The Board has updated the RAF as requested.

 Regarding RAF question # 21, to implement this final-form rulemaking, paper and online applications will have to be revised to reflect the new fees. Paper documents will be revised by Board administrative staff, who will change the fee amounts on an electronic copy of the paper document; this process will take about 15 minutes of staff time to complete the revisions per renewal year to revise the documents, as well as 15 minutes for the Bureau Business Licensing Division Chief, Bureau Deputy Commissioner and Board Counsel to each review and sign-off on the revisions. Online applications will be revised in PALS by Board administrative staff; this process will take about 1 hour of staff time to complete the revisions per renewal year, as well as 15 minutes for the Bureau Business Licensing Division Chief, Bureau Deputy Commissioner and Board Counsel to each review and sign-off on the revisions. The total estimated cost to revise paper and online documents is $381; $127 in FY 2022-2023, $127 in FY 2024-2025 and $127 in FY 2026-2027.

 Regarding RAF question # 26, the Board considered an alternative fee increase that did not include a graduated fee schedule but decided to not move forward with that version because the Board believes that the graduated application fee and graduated biennial renewal fee increases are more beneficial to the Board and to the licensees. The application fee increases on a graduated basis are reflective of the actual costs to process applications over time, which is more beneficial to the licensees to spread the needed increase in fees over time and not try to reduce the deficit all at once with higher fees. A nongraduated fee increase would have been much larger and may have put the Commonwealth at a competitive disadvantage to the other states in the region based on those higher fees. The same is true for the graduated increase to the biennial renewal fees because increasing fees in this manner coincides more closely with the projected expenses for each biennium. This is less impactful on the licensee population by spreading the needed fee increase out over several renewal cycles instead of implementing a higher fee all at once.

 Regarding RAF question # 28, when calculating the new application fees, the Board relied on fee report forms which were inadvertently not included with the RAF in its prior submission. This error has been corrected as noted previously and those reports are attached to the RAF in this final-form rulemaking.

 Fees for biennial license renewal, however, are not determined in the same way as fees for initial applications. Renewing a license is an online process through PALS where a licensee answers several questions and pays the appropriate fee. Generally, PALS automatically renews the license. Thus, there are no fee report forms for the biennial renewal fees. As noted previously, unlike initial application fees, biennial renewal fees are designed to cover the operational costs of the Board. These costs include salaries for administrative and legal staff as well as the cost for investigation of complaints, enforcement of statutory and regulatory requirements, hearing expenses and board member expenses. The biennial fees are calculated to ensure that the Board can meet or exceed its operational costs. Since biennial renewal fees are based on operating expenses and do not reflect the cost to process a renewal application, fee report forms are not utilized for biennial renewal fees.

Miscellaneous amendments for clarity

 The Board and the Acting Commissioner made minor amendments to the effective dates to clarify that the increase is applicable to each renewal period, and thereafter. In doing so, the effective dates of the biennial fee increases were amended to clarify that the first renewal fee increase will be implemented for the March 1, 2023—February 28, 2025, biennial renewal period. Thereafter, the subsequent graduated increases will be implemented for the March 1, 2025—February 28, 2027, biennial renewal period and then again for the March 1, 2027—February 28, 2029, biennial renewal period, and thereafter.

Fiscal Impact and Paperwork Requirements

 When the Board voted to increase the renewal and application fees, the Board was deficit spending and the BFO noted that if the Board did not increase its fees that deficit would continue to increase. The new fee structure approved by the Board will eliminate the deficit spending and decrease the current deficit balance. This will allow the Board to meet or exceed its projected expenditures in the coming biennial renewal cycles and will eventually put the Board back on firm financial ground.

 To accomplish this goal, the amendments will increase application and biennial renewal fees. Applicants, licensees and registrants will be required to comply with the regulation. The fees may be paid by applicants, licensees or registrants or may be paid by their employers, should their employers choose to pay these fees. This final-form rulemaking should have no other fiscal impact on the private sector, the general public or political subdivisions of the Commonwealth.

 Approximately 141 applicants will be impacted annually by the increased application fees. Specifically, the number of applicants affected are as follows: 25 auctioneers, 40 apprentice auctioneers, 1 course of study, 45 auction companies, 10 special licenses, 10 trading assistants and 10 trading assistant companies.

 Based upon the graduated application fee increases, the total economic impact per fiscal year is as follows:

FY 2021-2022: $10,735
FY 2022-2023: $10,735
FY 2023-2024: $ 2,245
FY 2024-2025: $ 2,245
FY 2025-2026: $ 2,245
FY 2026-2027: $ 2,245
 Total:     $30,450

 There are approximately 2,437 individuals who possess current licenses and registrations issued by the Board who will be required to pay more to renew their licenses and registrations.

 Based upon the above biennial renewal fee increases, the economic impact is as follows:

FY 2021—2023: $321,340
FY 2023—2025: $175,025
FY 2025—2027: $ 68,675
 Total:     $565,040

 Thus, the total economic impact to applicants, licensees, registrants, or employers, if employers choose to pay application or licensing fees, is $595,490. This amount reflects the economic impact that will occur between FY 2021-2022 through FY 2026-2027.

 This final-form rulemaking will require the Board to revise its printed and online application forms. The amendments will not create additional paperwork for the regulated community or for the private sector.

Sunset Date

 The Board continuously monitors the effectiveness of its regulations. Therefore, no sunset date has been assigned. Additionally, the BFO provides the Board with an Annual Board Budget Report detailing the Board's financial condition. In this way, the Board continuously monitors the adequacy of its fee schedule.

Regulatory Review

 Under section 5(a) of the Regulatory Review Act (71 P.S. § 745.5(a)), on March 10, 2022, the Board submitted a copy of the notice of proposed rulemaking published at 52 Pa.B. 1736 and a copy of an RAF to IRRC and to the Chairpersons of the SCP/PLC and the HPLC, for review and comment. Publication was followed by a 30-day public comment period during which the Board received no public comments.

 Under section 5(c) of the Regulatory Review Act, the Board is required to submit to IRRC, the HPLC and the SCP/PLC copies of comments received during the public comment period, as well as other documents when requested. The SCP/PLC did not submit comments. In preparing the final-form rulemaking, the Board and the Acting Commissioner have considered all comments from IRRC and the HPLC.

 Under section 5.1(g)(3) and (j.2) of the Regulatory Review Act (71 P.S. § 745.5a(g)(3) and (j.2)), on October 19, 2022, the final-form rulemaking was deemed approved by the HPLC and the SCP/PLC. Under section 5.1(e) of the Regulatory Review Act, IRRC met on October 20, 2022, and approved the final-form rulemaking.

Additional Information

 Additional information may be obtained by writing to Terri Kocher, Board Administrator, State Board of Auctioneer Examiners, P.O. Box 2649, Harrisburg, PA 17105-2649, RA-AUCTIONEER@pa.gov.

Findings

 The State Board of Auctioneer Examiners and the Acting Commissioner find that:

 (1) Public notice of intention to adopt a regulation at 49 Pa. Code, Chapter 1, was given under sections 201 and 202 of the act of July 31, 1968 (P.L. 769, No. 240) (45 P.S. §§ 1201 and 1202), referred to as the Commonwealth Documents Law and the regulations promulgated under those sections at 1 Pa. Code §§ 7.1 and 7.2 (relating to notice of proposed rulemaking required; and adoption of regulations).

 (2) A public comment period was provided as required by law and all comments were considered in drafting this final-form rulemaking.

 (3) The amendments to this final-form rulemaking do not enlarge the original purpose for the proposed regulation published at 52 Pa.B. 1736.

 (4) These amendments to the regulations of the State Board of Auctioneer Examiners are necessary and appropriate for the regulation of the practice of auctioneering in the Commonwealth.

Order

 The Board therefore orders that:

 (A) The regulations of the State Board of Auctioneer Examiners, 49 Pa. Code, Chapter 1, are amended by amending § 1.41 to read as set forth in Annex A.

 (B) The Board shall submit a copy of this final-form rulemaking to the Office of the Attorney General and the Office of General Counsel for approval as required by law.

 (C) The Board shall submit this final-form rulemaking to IRRC, the HPLC and the SCP/PLC as required by law.

 (D) The Board shall certify this final-form rulemaking and shall deposit it with the Legislative Reference Bureau as required by law.

 (E) This final-form rulemaking shall take effect immediately upon publication in the Pennsylvania Bulletin.

NEVIN B. RENTZEL, 
Chairperson, State Board of Auctioneer Examiners

ARION CLAGGETT, 
Acting Commissioner, Bureau of Professional and Occupational Affairs

 (Editor's Note: See 52 Pa.B. 6941 (November 5, 2022) for IRRC's approval order.)

 Fiscal Note: Fiscal Note 16A-6411 remains valid for the final adoption of the subject regulation.

Annex A

TITLE 49. PROFESSIONAL AND VOCATIONAL STANDARDS

PART I. DEPARTMENT OF STATE

Subpart A. PROFESSIONAL AND OCCUPATIONAL AFFAIRS

CHAPTER 1. STATE BOARD OF AUCTIONEER EXAMINERS

FEES

§ 1.41. Schedule of fees.

 (a) An applicant for a license, certificate, registration or service shall pay the following fees at the time of application:

		Effective December 10, 2022	Effective July 1, 2025	Effective July 1, 2027
(1) Auctioneer	Application for license to practice as an auctioneer	$180	$200	$220
(2) Apprentice auctioneer	Application for license to practice as an apprentice auctioneer	$145	$160	$175
	Application fee to change sponsor	$15	$15	$15
(3) Auction company	Application for license to practice as an auction company	$120	$135	$150
	Application fee to change auction company license	$15	$15	$15
(4) Trading assistant	Application for registration to practice as a trading assistant	$120	$135	$150
(5) Trading assistant company	Application for registration to practice as a trading assistant company	$120	$135	$150
(6) Miscellaneous
	Special license to conduct auction	$120	$135	$150
	Application fee to approve course	$180	$200	$220
	Certification of scores, permit or registration	$25	$25	$25
	Verification of license, registration, permit or approval	$15	$15	$15

 (b)  An applicant for biennial renewal of a license, certificate or registration shall pay the following fees:

		March 1, 2023— February 28, 2025 biennial renewal	March 1, 2025— February 28, 2027 biennial renewal	March 1, 2027— February 28, 2029 biennial renewal and thereafter
(1) Auctioneer	Biennial renewal	$400	$475	$500
(2) Apprentice auctioneer	Biennial renewal	$200	$250	$300
(3) Auction company	Biennial renewal	$400	$475	$500
(4) Trading assistant	Biennial renewal	$200	$250	$300
(5) Trading assistant company	Biennial renewal	$200	$250	$300

[Pa.B. Doc. No. 22-1926. Filed for public inspection Decemeber 9, 2022, 9:00 a.m.]

---

No part of the information on this site may be reproduced for profit or sold for profit.

This material has been drawn directly from the official Pennsylvania Bulletin full text database. Due to the limitations of HTML or differences in display capabilities of different browsers, this version may differ slightly from the official printed version.

---