PROPOSED RULEMAKING
DEPARTMENT OF COMMUNITY AND ECONOMIC DEVELOPMENT
[12 PA. CODE CH. 145]
Inspections and Fees
[53 Pa.B. 5774]
[Saturday, September 16, 2023]The Department of Community and Economic Development (Department) proposes to amend §§ 145.93 and 145.94 (relating to factory inspections; right of entry; and fees) to read as set forth in Annex A.
Effective Date
The amendments will be effective upon final-form publication in the Pennsylvania Bulletin.
Statutory Authority
Section 5 of the Industrialized Housing Act (act) (35 P.S. § 1651.5) authorizes the Department to promulgate rules and regulations to interpret and make specific the provisions of the act. As stated in section 2(5) and (6) of the act (35 P.S. § 1651.2(5) and (6)), the purpose of the act is to set uniform State standards and procedures for inspections. Section 7 of the act (35 P.S. § 1651.7) requires the Department to establish a schedule of fees reasonably related to the costs of administering and enforcing the act.
Background and Purpose of Amendments
This proposed rulemaking changes the inspection cycle for factories and manufacturing facilities with approved building system documentation from annual to biennial. The current inspection cycle was set in 1988; it must be updated for the Department to conduct inspections within its current resource constraints but without reducing the effectiveness of the Department's oversight.
In addition, this proposed rulemaking increases the fees collected from in-State manufacturers for the purchase of insignias of certification for each module of an industrialized housing and each industrialized housing component. The current fee level was set in 2004; it must be updated to help support the Department's current costs of administering and enforcing the act. The new fee level will mirror the fee level applicable to in-State manufacturers for the insignias of certification for industrialized commercial buildings, building modules and building components.
Currently, the program is solely funded by revenue generated by the sale of insignias that are purchased by the manufacturers; no other funding sources are provided to support the program. This proposed rulemaking will provide additional funding to hire more staff so the Department can meet its program obligations. Otherwise, due to the implementation of a separate program regarding commercial buildings, the Department will struggle to meet its obligations for industrialized housing with its current staff complement.
Description of Proposed Amendments
The Department proposes to amend § 145.93(b) to change the inspection cycle for factories and manufacturing facilities with approved building system documentation from at least once each year to at least once every other year.
The Department also proposes to amend § 145.94(e)(1) and (2) to increase the fees collected from in-State manufacturers for the purchase of insignias of certification for each module of an industrialized housing and each industrialized housing component from $40 per insignia to $60 per insignia.
The Department further proposes to amend § 145.94(e)(2) to state that the fee payable under paragraph (2) for industrialized housing components installed in or on a single dwelling unit may not exceed $60.
Fiscal Impact
A less frequent inspection cycle will provide a cost savings to the Department of approximately $6,000 per fiscal year due to less frequent travel expenses. Those cost savings, along with the increase in the insignia fee collected from in-State manufacturers, will provide funding to support an additional staff member to help the Department fulfill its statutory obligations under the act.
This proposed rulemaking will help establish parity between out-of-State manufacturers and in-State manufacturers because out-of-State manufacturers currently pay $60 per insignia and in-State manufacturers currently pay $40 per insignia. The industrialized housing program does not receive any additional funding and is funded solely by insignia fees collected.
Based on current insignia orders, the total economic impact per fiscal year from the fee increase is projected to be an additional $42,000 among 28 facilities (approximately $1,500 per facility). This proposed rulemaking will have no other fiscal impact on the Commonwealth, the regulated community, the general public or local governments.
Paperwork Requirements
The Department will need to update its printed and online insignia order forms to note the fee increase. The amendments will not create additional paperwork for the regulated community, the general public or local governments.
Benefits
This proposed rulemaking will generate budgetary and staffing resources that will allow the Department to continue to carry out its responsibilities under the act without reducing the effectiveness of the program. Although the inspection cycle would be reduced from annual to biennial, the Department has instituted other methods to maintain appropriate oversight. Under § 145.91(a) (relating to reports to the Department), the Department receives monthly reports from contracted third-party agencies that conduct inspections of the manufacturers. The Department reviews those reports and follows up with the third-party agencies and manufacturers as appropriate, while still retaining the right to inspect the manufacturers directly. In addition, the Department provides training to local government employees who inspect industrialized housing and, in turn, report their findings back to the Department.
The fee increase for in-State manufacturers of industrialized housing and components is minimal, and the new fee level mirrors the level for industrialized commercial buildings, building modules and building components in this Commonwealth. The new fee level is also reasonable as compared with other states.
Affected Persons
This proposed rulemaking will affect 39 manufacturing facilities (28 in this Commonwealth and 11 outside of this Commonwealth) due to the change to the inspection cycle. In addition, the 28 facilities located in this Commonwealth will be affected by the fee increase because a $20 fee increase in 2017 applied only to facilities located outside of this Commonwealth.
Sunset Date
The Department continuously monitors the effectiveness of its regulations on a fiscal year and biennial basis. Therefore, no sunset date has been assigned.
Regulatory Review
Under section 5(a) of the Regulatory Review Act (71 P.S. § 745.5(a)), on September 1, 2023, the Department submitted a copy of this proposed rulemaking and a copy of a Regulatory Analysis Form to the Independent Regulatory Review Commission (IRRC) and to the Chairpersons of the Senate Community, Economic and Recreational Development Committee and the House Commerce Committee. A copy of this material is available to the public upon request.
Under section 5(g) of the Regulatory Review Act, (71 P.S. § 745.5(g)), IRRC may convey any comments, recommendations or objections to this proposed rulemaking within 30 days from the close of the public comment period. The comments, recommendations or objections must specify the regulatory review criteria in section 5.2 of the Regulatory Review Act (71 P.S. § 745.5b) which have not been met. The Regulatory Review Act specifies detailed procedures for review, prior to final publication of the rulemaking, by the Department, the General Assembly and the Governor.
Public Comment
Interested persons are invited to submit written comments, suggestions or objections regarding this proposed rulemaking by e-mail to RA-housingstandards@pa.gov or by United States mail to Michael Moglia, Director, Housing Standards Division, Department of Community and Economic Development, Commonwealth Keystone Building, 400 North Street, 4th Floor, Harrisburg, PA 17120-0225, within 30 calendar days after the date of publication of this proposed rulemaking in the Pennsylvania Bulletin. Reference Regulation No. 4-100 when submitting comments.
In addition, under § 145.97 (relating to amendments to this chapter), the Department is providing separate notice of this proposed rulemaking to third-party agencies and to manufacturers with approved building system documentation. They will be invited to provide input through the public comment and public hearing process.
The Department has already sought comments and feedback informally from several large manufacturers of industrialized housing as well as third-party inspection agencies. They expressed their understanding that the proposed changes were needed to support and maintain the current program.
The Department did not consult with the Industrialized Housing Advisory Commission (Commission) in drafting or promulgating this proposed rulemaking as required by section 5(a) and section 8 of the act (35 P.S. §§ 1651.5(a) and 1651.8), because the Commission has not been in existence since 2012. However, the Department welcomes comments from the regulated community, the general public and other interested parties through the public comment and public hearing processes.
Public Hearing
Under section 5(b) of the act, the Department will hold a public hearing for the purpose of accepting comments on this proposal. The hearing will be held on February 6, 2024, 10 a.m. to 12 p.m., in PUC Hearing Room 2, Commonwealth Keystone Building, 400 North Street, Harrisburg, PA 17120-0225.
Persons wishing to present testimony at a hearing are requested to contact the Department by e-mail to RA-housingstandards@pa.gov, at (717) 720-7416, or by United States mail to Michael Moglia, Director, Housing Standards Division, Department of Community and Economic Development, Commonwealth Keystone Building, 400 North Street, 4th Floor, Harrisburg, PA 17120-0225, at least 1 week in advance of the hearing to reserve a time to present testimony. Oral testimony is limited to 10 minutes for each witness. Witnesses are requested to submit three written copies of their oral testimony to the hearing chairperson at the hearing. Organizations are limited to designating one witness to present testimony on their behalf at each hearing.
FREDERICK C. SIGER,
SecretaryFiscal Note: 4-100. No fiscal impact; recommends adoption.
Annex A
TITLE 12. COMMERCE, TRADE AND LOCAL GOVERNMENT
PART V. COMMUNITY AFFAIRS AND DEVELOPMENT
Subpart C. COMMUNITY DEVELOPMENT AND HOUSING
CHAPTER 145. INDUSTRIAL HOUSING AND COMPONENTS
ADMINISTRATIVE PROVISIONS § 145.93. Factory inspections; right of entry.
* * * * * (b) [Yearly] Biennial inspections. A factory or manufacturing facility with approved building system documentation will be inspected at least once [each] every other year by the Department. The inspections are to verify the effectiveness of the sponsor's quality program and compliance with approved building systems documentation.
* * * * * § 145.94. Fees.
* * * * * (e) For manufacturing facilities in this Commonwealth, the insignia of certification fee is:
(1) $[40] 60 per insignia for each module of an industrialized housing.
(2) $[40] 60 per insignia for each industrialized housing component. The fee payable under this paragraph for industrialized housing components installed in or on a single dwelling unit may not exceed $[40] 60.
(3) $60 per insignia for each transportable section of an industrialized building.
(4) $60 per insignia for each industrialized building module or component. A manufacturer may request special consideration from the Department in the event the manufacturer believes that insignia placement on individual modules or components is unreasonable due to the unique scope of a particular project.
* * * * *
[Pa.B. Doc. No. 23-1247. Filed for public inspection September 15, 2023, 9:00 a.m.]
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