PROPOSED RULEMAKINGS
STATE BOARD OF
BARBER EXAMINERS
[ 49 PA. CODE CH. 3 ]
Fees
[43 Pa.B. 1854]
[Saturday, April 6, 2013]The State Board of Barber Examiners (Board) proposes to amend § 3.103 (relating to fees) to read as set forth in Annex A. The proposed rulemaking would provide for increases to the biennial license renewal fees for licensees of the Board and would also adjust certain application fees to cover the costs of processing applications.
Effective Date
The proposed rulemaking will be effective upon final-form publication in the Pennsylvania Bulletin. The new application fees will be implemented immediately upon publication of the final-form rulemaking. The new biennial renewal fees will take effect for the biennial period beginning May 1, 2014.
Statutory Authority
Section 14(b) of the act of June 19, 1931 (P. L. 589, No. 202) (63 P. S. § 564(b)), known as the Barbers' License Law (act), requires the Board to increase fees by regulation to meet or exceed projected expenditures if the revenues raised by fees, fines and civil penalties are not sufficient to meet expenditures over a 2-year period.
Background and Need for proposed Rulemaking
Under section 14 of the act, the Board is required by law to support its operations from the revenue it generates from fees, fines and civil penalties. In addition, the act provides that the Board must increase fees if the revenue raised by fees, fines and civil penalties is not sufficient to meet expenditures over a 2-year period. The Board raises the vast majority of its revenue through biennial renewal fees. A small percentage of its revenue comes from application fees and civil penalties.
The biennial renewal fees have not been increased since 1988. Biennial renewal fees support the general operations of the Board. Licensees are charged the biennial renewal fees when they renew their licenses which expire on April 30 of even-numbered years. Application fees, on the other hand, are intended to offset the costs associated with the processing of the various applications and related inspections. The last time application fees were adjusted was in 2001.
At the June 25, 2012, Board meeting, representatives from the Department of State's Bureau of Finance and Operations (BFO) presented a summary of the Board's revenue and expenses for Fiscal Years (FY) 2009-2010 and 2010-2011 and projected revenue and expenses through FY 2014-2015. The BFO pointed out that as of June 2012, in spite of it being a renewal year, the Board incurred a deficit of $46,816.71. Projected revenues for FY 2012-2013, a nonrenewal year, were estimated at approximately $85,000. However, the Board's projected expenditures for the current fiscal year are in the area of $640,000, resulting in a projected deficit as of June 2013 of $601,816.71. The BFO projected that, without an increase to the biennial renewal fees, the Board will incur additional deficits totaling approximately $686,816.71 in FY 2013-2014 and $1,281,816.71 in FY 2014-2015. At that time, the BFO recommended that the Board consider increasing the biennial renewal fees by 205% to recoup the existing deficits and provide adequate revenues to meet the Board's operational needs. The Board voted to table the matter until the August 2012 meeting and asked the BFO to provide them with some options.
Thereafter, representatives from the BFO returned to the August 20, 2012, Board meeting. At that time, they presented the Board with four options. The first option was to consider not increasing fees, which would result in a continually growing deficit projected to reach $5 million by FY 2022-2023. The next option proposed was a one-time 200% increase in biennial renewal fees effective in April 2014. This option eliminates all deficits by the end of FY 2017-2018 and provides a positive, albeit declining, balance in the Board's account through FY 2023-2024. The third option proposed would break the 200% increase down into two increments, one taking effect in April 2014 and the second taking effect in April 2018. This proposal results in continued deficits through FY 2023-2024. Finally, the BFO presented as a fourth option, the fee increase that the Board had previously considered, which included an increase of 125% to take place in FY 2013-2014, followed by an increase of an additional $15 for all license categories to take place in FY 2015-2016. This option also fails to eliminate the deficits into the foreseeable future.
Thus, the Board determined that it was necessary to raise fees to meet or exceed projected expenditures in compliance with section 14 of the act. As a result, the Board voted to increase the biennial renewal fees by 200% to be effective with the April 30, 2014, renewal. The Board finds this to be the only viable option that will eliminate the deficits and place the Board on firm financial ground so that the Board can continue to carry out its legislative mandate in the interests of the public health, safety and welfare. In addition, the Board previously voted to adjust certain application fees to more appropriately reflect the current costs of processing the applications. These adjustments are also included in this proposed rulemaking.
Description of Proposed Amendments
Based upon the expense and revenue estimates provided to the Board, the Board proposes to amend § 3.103 to increase the biennial renewal fees for all classes of licensees. The biennial renewal fees will increase in 2014 by 200%: from $42 to $126 for barbers; from $62 to $186 for barber shop managers; from $67 to $201 for barber teachers; from $72 to $216 for barber shops; and from $112 to $336 for barber schools.
In addition, as a result of the review of the application fees conducted by the BFO, the Board proposes to increase the fee for initial licensure by reciprocity from $20 to $55, as the existing fee is no longer adequate to cover the costs associated with processing the application. Likewise, the application fee for initial licensure of a barber shop, currently set at $55, is insufficient to cover the costs associated with processing the application and conducting the required inspection. Therefore, the Board voted to increase the fee to $110. Conversely, the current fee for initial licensure of a barber school, which was increased in 2001 from $100 to $280, has proven to be excessive when compared to the actual costs associated with processing an application for licensure of a barber school, along with the required inspection. Therefore, the Board proposes a reduction in this fee from $280 to $140. There are two fees the Board charges when a barber shop proposes a change depending on whether the proposed change requires an inspection. The Board is proposing to increase the fee when an inspection is required from $55 to $90 and when an inspection is not required from $15 to $40. Similarly, the fee to reinspect a shop or school after a failed inspection is proposed to increase from $40 to $90. Again, these increases are needed to cover actual costs associated with processing the applications and conducting the inspections.
Fiscal Impact
The proposed rulemaking will increase the biennial renewal fees for licensees of the Board. There are currently approximately 9,344 licensees that will be required to pay more to renew their licenses when they expire on April 30, 2014. In addition, applicants for various licenses will incur greater costs associated with processing applications and conducting inspections. The proposed rulemaking should not have other fiscal impact on the private sector, the general public or political subdivisions of this Commonwealth.
Paperwork Requirements
The proposed rulemaking will require the Board to alter some of its forms to reflect the new fees. However, the proposed amendment will not create additional paperwork for the regulated community or for the private sector.
Sunset Date
The act requires the Board to monitor its revenue and costs on a fiscal year and biennial basis. Therefore, a sunset date has not been assigned.
Regulatory Review
Under section 5(a) of the Regulatory Review Act (71 P. S. § 745.5(a)), on March 25, 2013, the Board submitted a copy of this proposed rulemaking and a copy of a Regulatory Analysis Form to the Independent Regulatory Review Commission (IRRC) and the Chairpersons of the House Professional Licensure Committee and the Senate Consumer Protection and Professional Licensure Committee. A copy of this material is available to the public upon request.
Under section 5(g) of the Regulatory Review Act, IRRC may convey comments, recommendations or objections to the proposed rulemaking within 30 days of the close of the public comment period. The comments, recommendations or objections must specify the regulatory review criteria which have not been met. The Regulatory Review Act specifies detailed procedures for review, prior to final publication of the rulemaking, by the Board, the General Assembly and the Governor of comments, recommendations or objections raised.
Public Comment
Interested persons should submit written comments, suggestions or objections regarding this proposed rulemaking to Cynthia Montgomery, Regulatory Counsel, State Board of Barber Examiners, P. O. Box 2649, Harrisburg, PA 17105-2649 within 30 days following publication of this proposed rulemaking in the Pennsylvania Bulletin.
JOHN E. PAYNE, Jr.,
ChairpersonFiscal Note: 16A-428. No fiscal impact; (8) recommends adoption.
Annex A
TITLE 49. PROFESSIONAL AND VOCATIONAL STANDARDS
PART I. DEPARTMENT OF STATE
Subpart A. PROFESSIONAL AND OCCUPATIONAL AFFAIRS
CHAPTER 3. STATE BOARD OF BARBER EXAMINERS
SCHOOLS OF BARBERING § 3.103. Fees.
The schedule of fees charged by the Board is as follows:
* * * * * Licensure of barber by reciprocity [$20] $55
Licensure of barber shop [$55] $110
Licensure of barber school [$280] $140
Biennial renewal of barber license [$42] $126
Biennial renewal of barber shop manager license [$62] $186
Biennial renewal of barber teacher license [$67] $201
Biennial renewal of barber shop license [$72] $216
Biennial renewal of barber school license [$112] $336
Change in barber shop—inspection required [$55] $90
Change in barber shop—no inspection required [$15] $40
Reinspection after first fail—new or change (shop or school) [$40] $90
* * * * *
[Pa.B. Doc. No. 13-611. Filed for public inspection April 5, 2013, 9:00 a.m.]
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