NORTH CAROLINA
Volume ID, Issue 15
Pages 1428 - 1 650
NOVEMBER 1, 1995
This issue contains documents officially filed
through October 18, 1995.
Office of Administrative Hearings
Rules Division
424 North Blount Street (27601)
PO Drawer 27447
Raleigh, NC 27611-7447
(919) 733-2678
FAX (919) 733-3462
Julian Mann III, Director
James R. Scarcella Sr., Deputy Director
Molly Masich, Director of APA Services
Ruby Creech, Publications Coordinator
Teresa Kilpatrick, Editorial Assistant
Jean Shirley, Editorial Assistant
IN THIS ISSUE
I. IN ADDITION
Industrial Commission 1428
Voting Rights Act 1429-1431
II. PROPOSED RULES
Agriculture
Plant Industry 1432-1435
Environment, Health, and Natural Resources
Coastal Resources 1552 - 1565
Environmental Management 1515 - 1551
Marine Fisheries 1551 - 1552
Wildlife Resources 1565 .
Human Resources
Medical Assistance 1479-1483
Mental Health, Developmental Disabilities and
Substance Abuse Services 1435 - 1479
Social Services 1483-1489
Insurance
Actuarial Services 1514
Consumer Services 1489 - 1490
Financial Evaluation Division 1503 - 1513
Investigations Division 1490 - 1492
Property and Casualty 1492- 1502
Special Services Division 1513-1514
Licensing Boards
Electrical Contractors 1579-1583
Landscape Architects 1583 - 1584
Public Education
Elementary & Secondary 1565 - 1567
Secretary of State
Corporations Division 1567-1573
Notary Public Division 1578-1579
Securities Division 1575 - 1578
Uniform Commercial Code 1573 - 1575
m. LIST OF RULES CODIFIED 1585-1588
IV. RRC OBJECTIONS 1589-1594
V. CONTESTED CASE DECISIONS
Index to ALJ Decisions 1595-1609
Text of Selected Decisions
94 OSP 0684 1610- 1623
95 CPS 0459 1624- 1627
95 CPS 0540 1628- 1631
95 EDC 0027 1632- 1633
VI. CUMULATIVE INDEX 1635-1650
NORTH CAROLINA REGISTER
Publication Schedule
(July 1995 - November 1995)
Volume
and
Issue
Number
Issue
Date
Last Day
for Filing
Last Day
for Elec-tronic
Filing
Earliest
Date for
Public
Hearing
15 days
from no-tice
• End of
Required
Comment
Period
30 days
from
notice
I flst Day
to Submit
toRRC
** FjirUest
Effective
Date
10:7 07/03/95 06/12/95 06/19/95 07/18/95 08/02/95 08/21/95 10/01/95
10:8 07/14/95 06/22/95 06/29/95 07/31/95 08/14/95 08/21/95 10/01/95
10:9 08/01/95 07/11/95 07/18/95 08/16/95 08/31/95 09/20/95 11/01/95
10:10 08/15/95 07/25/95 08/01/95 08/30/95 09/14/95 09/20/95 11/01/95
10:11 09/01/95 08/11/95 08/18/95 09/18/95 10/02/95 10/20/95 12/01/95
10:12 09/15/95 08/24/95 08/31/95 10/02/95 10/16/95 10/20/95 12/01/95
10:13 10/02/95 09/11/95 09/18/95 10/17/95 11/01/95 11/20/95 01/01/96
10:14 10/16/95 09/25/95 10/02/95 10/31/95 11/15/95 11/20/95 01/01/96
10:15 11/01/95 10/11/95 10/18/95 11/16/95 12/01/95 12/20/95 02/01/96
10:16 11/15/95 10/24/95 10/31/95 11/30/95 12/15/95 12/20/95 02/01/96
This table is published as a public service, and the computation of time periods are not to be deemed binding or controlling.
Time is computed according to 26 NCAC 2B .0103 and the Rules of Civil Procedure, Rule 6.
* An agency must accept comments for at least 30 days after the proposed text is published or until the date of any public
hearing, whichever is longer. See G.S. 150B-21.2(f) for adoption procedures.
** The "Earliest Effective Date" is computed assuming that the agency follows the publication schedule below, that the Rules
Review Commission approves the rule at the next calendar month meeting after submission, and that RRC delivers the rule to the
Codifier of Rules five (5) business days before the 1st day of the next calendar month.
Revised 07/95
IN ADDITION
This Section contains public notices that are required to be published in the Register or have been approved by the
Codifier of Rules for publication.
PUBLIC NOTICE OF RULE-MAKING
NORTH CAROLINA INDUSTRIAL COMMISSION
NOnCE IS HEREBY GIVEN that, pursuant to the rule-making authority vested in it by N.C.G.S. § 97-26 and
§ 143-300, the North Carolina Industrial Commission will consider adopting (1) a Revised Medical Fee Schedule, (2)
Revised Rules for Rehabilitation Services, (3) Utilization Review Rules, and (4) Managed Care Rules, all under the
Workers' Compensation Act, to become effective November 30, 1995. The Commission solicits the comments of all
interested persons, firms, and organizations. Copies of all four of the above may be obtained by any interested person by
addressing a request to the address below.
Hie Commission requests written comments on all four of the above. In addition, there will be a public hearing
held on the 16th day and 17th days of November, at 10:00 a.m., in Room 2149, the Utilities Commission Hearing Room,
Dobbs Building, 430 North Salisbury Street, Raleigh, N.C., during which the Commission will hear the verbal comments
of persons scheduled to speak. Those desiring to make an oral presentation, not to exceed 15 minutes in length, should
submit a request on or before November 14, 1995. Speakers at the public hearing are encouraged to prepare a written
summary of remarks for the use of the Commission.
WRITTEN COMMENTS, REQUESTS FOR COPIES OF ANY OR Ali OF THE FOUR AND REQUESTS FOR
ORAL PRESENTATIONS SHOULD BE ADDRESSED TO COMMISSIONER THOMAS J. BOLCH AT 430 NORTH
SAUSBURY STREET, RALEIGH, NC 27611. WRITTEN COMMENTS WILL BE RECEIVED BY THE COMMISSION
UP TO AND INCLUDING NOVEMBER 30, 1995.
This 17th day of October, 1995.
J. Howard Bunn, Jr., Chairman
North Carolina Industrial Commission
10:15 NORTH CAROLINA REGISTER November 1, 1995 1428
IN ADDITION
City of Greenville
North Carolina
City Attorney's Office
P.O. Box 7207
Greenville, NC 27835-7207
Ms. Elizabeth Johnson
Acting Chief
Voting Section, Civil Rights Division
U.S. Department of Justice
P.O. Box 66128
Washington, D.C. 20035-6128
September 28, 1995
RE: Preclearance of Annexation/City of Greenville. N.C.
Dear Ms. Johnson:
In your letter of August 22, 1995, you advised us that the nine annexations submitted to your office by our office on June
23, 1995 had been precleared pursuant to Section 5 of the Voting Rights Act of 1965. As described in your letter, the
ordinance numbers were "94-19, 25, 26, 36, 38, 41, and 45-47," suggesting that all of the ordinances had a prefix number
of "94." In fact, only Ordinance #94-19 had that prefix; the remainder of the ordinances submitted for preclearance had
a prefix of "95." This apparent oversight has resulted in some confusion in our City Clerk's office and in the office of the
local Board of Elections.
Accordingly, please confirm that the ordinance numbers for the annexations that received preclearance, as advised in your
letter of August 22, 1995, are as follows:
Ordinance No. 94-19 (Lot 4, Block A, Park Place and a portion of Hemby Lane)
Ordinance No. 95-25 (Thomas F. Taft property)
Ordinance No. 95-26 (South Square, Phase 3, Lots 1-2)
Ordinance No. 95-36 (Windsor Subdivision, Section 10, Lot 430)
Ordinance No. 95-38 (Portion of Thomas F. Taft property)
Ordinance No. 95-41 (Covengton Downe Subdivision, Lot 24, Block A)
Ordinance No. 95-45 (G. Randy Bailey property)
Ordinance No. 95-46 (Willow Run)
Ordinance No. 95-47 (Windsor Subdivision, Section 9)
If you need any further information or have any questions, please do not hesitate to call me.
With best wishes, 1 am
Sincerely yours,
Robert W. Oast, Jr.
City Attorney
1429 NORTH CAROLINA REGISTER November 1, 1995 10:15
IN ADDITION
City of Greenville
North Carolina
City Attorney's Office
P.O. Box 7207
GreenvUle, NC 27835-7207
Ms. Elizabeth Johnson
Acting Chief
Voting Section, Civil Rights Division
U.S. Department of Justice
P.O. Box 66128
Washington, D.C. 20035-6128
September 29, 1995
RE: Preclearance of Annexation/City of Greenville. N.C.
Dear Ms. Johnson:
This is a follow-up to my letter to you of yesterday, September 28, 1995, wherein I requested clarification regarding
ordinance numbers for 9 annexations with respect to which you had advised us of preclearance under Section 5 of the Voting
Rights Act in a letter dated August 22, 1995. In yesterday's letter, I advised you that only Ordinance #94-19 had the "94"
prefix, and that the remaining 8 ordinances should have had a prefix of "95. " That information is still correct with respect
to all of the ordinances except 94-19.
In my letter to you of June 21, 1995 (copy enclosed), I listed Ordinance #94-19 as one of those with respect to which the
City was requesting preclearance. A review of the ordinances actually submitted for preclearance indicates that Ordinance
#94-19 should be Ordinance #95-19. A certified copy of that ordinance is enclosed for your use. All of the other ordinance
numbers in that submission are correct, but clarification of your August 22, 1995 letter with respect to those ordinance
numbers is stUl necessary.
I apologize if I have added confusion to this already confusing matter. If you have any questions or need any further
information, please give me a call.
With best wishes, I am
Sincerely yours.
Robert W. Oast, Jr.
City Attorney
10:15 NORTH CAROLINA REGISTER November 1, 1995 1430
IN ADDITION
U.S. Department of Justice
Civil Rights Division
DLP;GS:VNN:tlb Voting Section
DJ 166-012-3 P.O. Box 66128
95-1826 Washington, D.C. 20035-6128
October 10, 1995
Robert W. Oast, Jr. Esq.
City Attorney
P.O. Box 7207
Greenville, North Carolina 27835-7207
Dear Mr. Oast:
This refers to your September 28 and 29, 1995, letters concerning the submission under Section 5 of the Voting
Rights Act, 42 U.S.C. 1973c, of nine annexations (ordinance Nos. 95-19, 25, 26, 36, 38, 41, and 45 to 47) and their
designation to districts of the City of Greenville in Pitt County, North Carolina.
We have reviewed our records and it appears that our August 22, 1995, letter contained a typographical error in
that it stated the incorrect year. Please be advised that our records show that on August 22, 1995, Section 5 preclearance
was granted to the above-referenced changes. We apologize for any inconvenience we may have caused you in this matter.
Sincerely,
Deval L. Patrick
Assistant Attorney General
Civil Rights Division
By:
Elizabeth Johnson
Acting Chief, Voting Section
1431 NORTH CAROLINA REGISTER November 1, 1995 10:15
PROPOSED RULES
TITLE 2 - DEPARTMENT OF AGRICULTURE
Notice is hereby given in accordance with G.S.
150B-21.2 that the North Carolina Board of Agricul-ture
intends to amend rules cited as 2 NCAC 48A .1702;
52B .0207, .0212, .0302; 52C .0105 and adopt 2 NCAC
48C .0029.
Proposed Effective Date: February 1, 1996.
A Public Hearing will be conducted at 10:00 a.m. on
December 7, 1995 at Gov. James B. Hunt, Jr. Horse
Complex (Restaurant), 4601 Trinity Rd. , Raleigh, NC
27607.
Reason for Proposed Action:
2 NCAC 48A .1702 - To add the MUe-a-Minute plant to the
official list of noxious weeds, in order to provide for the
regulation and control.
2 NCAC 48C .0029 - To require the variety to be stated on
the labelfor certain kinds of seed, in order to protect buyers
of seed.
2 NCAC 52B .0207 - To establish requirements for importa-tion
of "sporting swine" into North Carolina, in order to
prevent the introduction and spread of swine diseases and to
modify pseudorabies program requirements for importation
of all breeding swine.
2 NCAC 528 .0212 - To add the Brushtail Possum to the
list of animals for which a permit is requested prior to
importation, in order to prevent the introduction and spread
of animal diseases.
2 NCAC 52B .0302 - To require "sporting swine" offered
for sale within the state to originate from a validated
brucellosis-free herd, in order to prevent the spread of
brucellosis in swine.
2 NCAC 52C .0105 - To require "sporting swine" offered
for sale within the state to originate from a qualified
pseudorabies-negative herd, in order to prevent the spread
of pseudorabies among swine and to modify pseudorabies
program requirements for movement of all feeding and
breeding swine within the state.
Comment Procedures: Interested persons may present their
statements either orally or in writing at the public hearing
or in writing prior to the hearing by mail addressed to
David S. McLeod, Secretary of the North Carolina Board of
Agriculture, P.O. Box 27647, Raleigh, NC 27611.
Fiscal Note: These Rules do not affect the expenditures or
revenues of state or local government funds.
CHAPTER 48 - PLANT INDUSTRY
SUBCHAPTER 48A - PLANT PROTECTION
SECTION .1700 - STATE NOXIOUS WEEDS
.1702 NOXIOUS WEEDS
(a) Class A Noxious Weeds. The North Carolina Board
of Agriculture hereby establishes the following list of Class
A Noxious Weeds:
(1) All weeds listed in 7 C.F.R. 360.200 which is
hereby incorporated by reference including
subsequent amendments and editions. Copies of
the Code of Federal Regulations may be ob-tained
from the Superintendent of Documents,
Government Printing Office, Washington, DC
20402, at a cost of twelve dollars ($12.00);
(2) Elodea, African ~ Lagarosiphon spp. (all spe-cies);
(3) Fern, Water ~ Salvinia spp. (all except S.
rotundifolia);
(4) Mile-a-Minute ;; Polygonum perfoliatum:
(^ £5} Stonecrop, Swamp — Crassula helmsii;
(5) £6} Water-chestnut — Trapa spp.
(b) Class B Noxious Weeds. The North Carolina Board
of Agriculture hereby establishes the following list of Class
B Noxious Weeds:
(1) Betony, Florida—Stachys floridana Shuttlew.;
(2) Fieldcress, Yellow—Rorippa sylvestris (L.)
Bess.;
(3) Lythrum — Any Lythrum species not native to
North Carolina;
(4) Puncturevine—Tribulus terrestris L.;
(5) Thistle, Canada—Cirsium arvense (L.) Scop.;
(6) Thistle, Musk—Carduus nutans L.;
(7) Thistle, Plumeless—Carduus acanthoides L.;
(8) Watermilfoil, Eurasian — Myriophyllum
spicatum L.
;
(9) Waterprimrose, Uruguay — Ludwigia
uruguayensis (Camb.) Kara.
(c) Class C Noxious Weeds. The North Carolina Board
of Agriculture hereby establishes the following list of Class
C Noxious Weeds: none.
Statutory Authority G.S. 106-420.
SUBCHAPTER 48C - SEEDS
.0029 VARIETY LABELING
The variety name shall be stated on the seed analysis label
for the following kinds of seed:
(1) cotton;
(2) field com;
(3) peanuts:
(4) soybeans;
(5) tobacco; and
(6) wheat.
Statutory Authority G.S. 106-277.15.
CHAPTER 52 - VETERINARY DIVISION
SUBCHAPTER 52B - ANIMAL DISEASE
10:15 NORTH CAROLINA REGISTER November 1, 1995 1432
PROPOSED RULES
SECTION .0200 - ADNUSSION OF
LIVESTOCK TO NORTH CAROLINA
.0207 IMPORTATION REQUIREMENTS:
SWINE
(a) All swine imported into the state, except by special
permit or for immediate slaughter, shall be accompanied by
an official health certificate issued by a state, federal, or
accredited veterinarian stating that they are free from any
signs of an infectious or communicable disease and are not
known to have been exposed to same. The health certificate
shall contain the ear tag number of each animal or other
identification acceptable to the State Veterinarian. Swine
imported for feeding or breeding purposes shall be moved
in clean and disinfected trucks or other conveyances.
(b) Breeding swine shall originate from a "Validated
Brucellosis-Free" herd or a "Validated Brucellosis-Free"
State and originate from a "Qualified Pseudora-bies-
Negative" h*fd herd, Qualified-Negative Gene-Altered
Vaccinated Herd (QNV) or Pseudorabies Stage IV or V
(Free) State as defined in Title 9, Parts 78.1 and 85 of the
Codo of Fadoral Rogulaliono. Parts 78 . 1 and 85 of Titl e 9
of th e Code of Fodoral Regulationo are hereby adoptod by
rcfcronce, including subseque nt amendments.—Copios of the
Codo of Fodoral Regulations may bo obtained from tho
Govomment Printing Offioo, Waohington, B.C., at a ooot
determined by that offic e.
(c) All feeder swine imported into the state shall be
accompanied by an official health certificate issued by a
state, federal or accredited veterinarian stating that:
(1) No pseudorabies vaccine has been used in the
herd of origin, unless the herd is a pseudorabies
Controlled Vaccinated herd as defined in Title 9,
Part 85. 1 of tho Code of Federal Regulations, or
a poeudorabi eo monitored vaccinated herd; and
(2) The swine were tested and found negative for
pseudorabies within 30 days prior to importa-tion;
or
(3) The swine originated from a pseudorabies-free
area as determined by the State Veterinarian; or
(4) The swine originated firom a Qualified Pseudora-bies
Negative Herd as defined in Title 9, Part 85
of the Code of Federal Regulationo ; or
(5) The swine originated from a monitored feeder
pig herd. For the purp>oses of this Rule, in
order to qualify' aa a monitored feeder pig herd,
testing must have boon performed in aooordanoe-with
the following standards:
(A)
—
In herds of ton or fewer brooding swine, all
brooding owine must test negative within 12
months prior to importation.
fB)
In herds of 1
1
—to 35 breeding swine,—tea
randomly selected breeding animals, (to in
elude giltii. sows and boars) must teet negative
within 12 months prior to importation.
(C^
In herds of more than 35 breeding swine,
either 30 or 30 percent of tho total herd.
whiobovor is looa, randomly soloctod brooding
ffi
lto, BOWS and boaro muot toot negative within
12 months prior to importation.
(©)
—
All brooding gilto, sows and booro in a herd
shall bo subject to random selection for testing.
(E)
Testing must be done by use of an official
poeudorabioo toot, as de fined in Titl e 9, Port
85 of the Codo of Fodoral Regulations.
(d) Healthy swine for feeding purposes may move directly
from a farm of origin in a contiguous state on which they
have been located for not less than 30 days to a livestock
market or stockyard in North Carolina that has been
state-federal approved for handling feeder swine, without the
health certificate required herein, provided such swine are
accompanied by proof of the pseudorabies status of the herd
of origin acceptable to the State Veterinarian. Such swine
shall be inspected by a state or federal inspector or approved
accredited veterinarian prior to sale at the market.
(e) Healthy swine may be shipped into the state for
immediate slaughter without a health certificate provided
they go directly to a slaughtering establishment approved by
the State Veterinarian, or to a state-federal approved
livestock market or stockyard for sale to an approved
slaughtering establishment for immediate slaughter only.
(f) j\fl uflod in Paragraph (c)(1) of thio Rulo, a "monitorod
vaooinatod herd" moono a herd in which all brooding swine
over six months of age have boon officially vaooinatod by on
accredited vetorirutrian s^'ith a vaocine tho titers of which can
bo distinguished from psoudorabios fiold infections and tho
herd hac paooed an official random sample toot or complete
herd toot during the preceding 12 months.—(From propoood
Pseudorabies Emdication Uniform Methods and Rules of tho
United States Department of Agriculture.)
(f) Sporting swine:
(1) For purposes of this Rule:
(A) "Sporting swine" means any domestic or feral
swine intended for hunting purposes and in-cludes
the progeny of these swine whether or
not the progeny are intended for hunting
purposes;
(B) "Feral swine" means any swine that have lived
any part of its life free roaming.
(2) No person shall import sporting swine into
North Carolina unless:
(A) The swine have not been fed garbage within
their lifetime; and the herd of origin is vali-dated
brucellosis free and qualified pseudora-bies
negative; and
CB) The swine have not been members of a herd of
swine known to be infected with brucellosis or
pseudorabies within the previous 12 months;
and
im The individual animals six months of
im
or
over have a negative brucellosis and pseudora-bies
test within 30 days of movement; and
The swine have not been a part of a feral
swine population or been exposed to swine
1433 NORTH CAROLINA REGISTER November 1, 1995 10:15
PROPOSED RULES
captured from a feral swine population within
the previous 12 months: and
CE) The swine are accompanied by an official
health certificate or certificate of veterinary
inspection identifying each animal by ear tag,
breed, age, sex, the state of origin, and certi-fying
that the swine meet the import require-ments
of North Carolina.
Note: Violation of this Rule is a misdemeanor under G.S.
106-307.6, which provides for a five hundred dollar
($500.00) fine, six months' imprisonment, or both.
Statutory Authority G.S. 106-307.5; 106-316.1; 106-317;
106-318.
.0212 IMPORTATION REQUIREMENTS:
WILD ANIMALS
(a) A person shall obtain a permit from the State Veteri-narian
before importing any of the following animals into
this State:
(1) Skunk;
(2) Fox;
(3) Raccoon;
(4) Ringtail;
(5) Bobcat;
(6) Coyote;
(7) Morten. Marten:
(8) Brushtail Possum (Trichosurus vulpecula").
(b) Permits for the importation into this State of any of
the animals listed in (a) of this Rule shall be issued only if
the animal(s) will be used in a research institute inotitute, or
for public display or organized entertainment as in zoos or
circuses.
(c) Llamas, all cervidae, bioon bison, and all other
bovidae other than domestic cattle may be imported into the
State if accompanied by an official health certificate issued
by an accredited veterinarian which states that:
(1) all animals six months of age or older have
tested negative for brucellosis within 30 days
prior to importation; and
(2) all animals six months of age or older have
tested negative for tuberculosis within 60 days
prior to importation pursuant to the guidelines of
the United States Department of Agriculture
Veterinary Services Notice dated December 31,
1990, which states "the cervical test for cervidae
is the intradermic injection of 0.1 ml. of U. S.
Department of Agriculture (USDA) contract
PPD Bovis tuberculin in the midcervical region
with reading by observation and palpation at 72
hours, plus or minus 6 hours"; and
(3) the herd of origin has had no brucellosis or
tuberculosis diagnosed within the past 12
months.
(d) Other wild and semi-wild animals, under domestica-tion
or in custody may be imported into this state State.
provided that a report of the number of animals by species
is made to the State Veterinarian within 96 hours after entry
into the otate, State and that an immediate opportunity for
examination to determine the health status of such animals
is afforded the State Veterinarian or his authorized represen-tative.
Statutory Authority G.S. 106-317; 106-400.
SECTION .0300 - BRUCELLOSIS
REGULATIONS
.0302 BRUCELLOSIS REQUIREMENTS
FOR SALE OF CATTLE AND SWINE
(a) All cattle offered for public sale must test negative for
brucellosis within 30 days preceding the date of sale except
those cattle listed as follows:
(1) cattle sold for immediate slaughter;
(2) native heifers and bulls less than 18 months of
age;
(3) steers and spayed heifers;
(4) officially brucellosis vaccinated heifers of the
dairy breeds imder 20 months of age (provided
that all officially brucellosis vaccinated heifers
of any breed that are parturient or post parturi-ent
must be tested and negative for brucellosis);
(5) officially brucellosis vaccinated heifers of the
beef breeds imder 24 months of age (provided
that all officially brucellosis vaccinated heifers
of any breed that are parturient or post parturi-ent
must be tested and negative for brucellosis);
(6) cattle originating directly from a certified brucel-losis-
free herd;
(7) heifers under 12 months of age purchased for
feeding purposes; at the discretion of the State
Veterinarian, buyers of feeder heifers under 12
months of age may be required, before they
remove such cattle from place of purchase, to
sign a statement of intent to feed those cattle not
tested for brucellosis in isolation from breeding
animals. Willful failure of a buyer of such
cattle to sign a statement of intent when re-quested
by the State Veterinarian or his autho-rized
representative or willful failure to comply
with such a signed statement of intent is a
violation of this Section.
(b) All swine sold or offered for sale for breeding
purposes must originate directly from a validated brucello-sis-
free herd unless they originate from a state classified as
swine-brucellosis free.
(c) Sporting swine:
(1) For the purpose of this Rule:
(A) "Sporting swine" means any domestic or feral
swine intended for hunting purposes and in-cludes
the progeny of these swine whether or
not the progeny are intended for hunting
purposes:
(B) "Feral swine" means any swine that have lived
10:15 NORTH CAROLINA REGISTER November 1, 1995 1434
PROPOSED RULES
any part of its life free roaming.
(2) All sporting swine sold or offered for sale must
originate directly from a validated brucellosis-free
herd.
Statutory Authority G.S. 106-389; 106-396.
SUBCHAPTER 52C - CONTROL OF
LIVESTOCK DISEASES: MISCELLANEOUS
PROVISIONS
SECTION .0100 - DISEASED AND DEAD
ANIMALS
.0105 PSEUDORABIES STATUS AND
TESTEVG
(a) Feeding and breeding swine may not be transported on
any public road or held in any public place unless accompa-nied
by a written permit from the State Veterinarian or
proof satisfactory to the State Veterinarian that:
(1) No pseudorabies vaccine has been used in the
herd of origin, unless the herd is a pseudorabies
Controlled Vaooinated herd as de fined in Title 9.
Part 85. 1 of the Code of Federal Rogulations, or
a psoudorabios monitored vaccinated herd or
unless the use of vaccine has been approved
under the North Carolina Pseudorabies Program;
and
(2) The swine were tested and found negative for
pseudorabies within 30 days prior to movement;
or
(3) The swine originated from a pseudorabies-free
area as determined by the State Veterinarian; or
(4) The swine originated from a Qualified Pseudora-bies
Negative Herd as defined in Title 9, Part 85
of the Code of Federal Regulations; or
(5) The swine originated from a monitored feeder
pig herd; or herd.—For the purposes of this
Rule, in orde r to qualify' as a monitored feeder
pig herd, testing must have boon porformod ia
accordanoc with the following stimdords:
(A^
In herds of ton or fewer breeding swine , all
breeding owine must test negativ e within 12
months prior to movement.
(B)
In herds of 1 1 to 35 brooding swino, ton
randomly selected breeding animals, (to in
elude gilts, sows and boars) must test negative
within 12 months prior to movement.
fG^)
—
In herds of more than 35 brooding swine.
e ith e r 30 or 30 pe rcent of the total herd,
whichever is less, randomly oeleoted breeding
gilts, sows and boars must tost negative within
12 months prior to movement.
(©^
All brooding gilts, cows and boars in a herd
shall be subj ect to rtmdom selection for testing.
(E)
Testing must bo done by use of an offioial
pseudorabies test, as dofmod in Title 9, Part
85 of the Code of Fodoral Rogulationo; Of
(6) The swine are being transjwrted or held in
accordance with the North Carolina Pseudora-bies
Program.
(b) The State Veterinarian or his representative is autho-rized
to test swine for pseudorabies in accordance with G.S.
106-400.1.
(c) Swine transported on a public road or held in a public
place in violation of this Rule are subject to quarantine and
may be transported or held only by written permit from the
State Veterinarian or his representative.
{4)—As usod in Paragraph (aXl) hereof, a "monitored
vaocirmtod herd" moons a herd in which all brooding swino
o'i
'er six months of ago have boon officially vaooinated by an
aooredited veterinarian with a vaooine the titers of which oan
bo distinguished from psoudorabios Field infoctiono and the
herd has {xisscd an official random sample tost or oomploto
herd test during the preceding 12 months.—(From proposed
Poeudombios Eradication Uniform Motbodo and Ruloo of tho
United Statos Dopartmont of Agrioulturo.)
(d) Sporting swine: m
(A}
mi
m
For the purpose of this Rule:
"Sporting swine" means any domestic or feral
swine intended for hunting purposes and in-cludes
the progeny of these swine whether or
not the progeny are intended for hunting
purposes;
"Feral swine" means any swine that have lived
any part of its life free roaming .
All sporting swine sold or offered for sale must
originate directly from a qualified pseudorabies-negative
herd.
Note: Violation of this regulation is a misdemeanor under
G.S. 106-22(3), and is punishable by fme or imprisonment
of not more than two years, or both.
Statutory Authority G.S. 106-22(3); 106-400.1.
TITLE 10 - DEPARTMENT OF HUMAN
RESOURCES
Notice is hereby given in accordance with G.S.
150B-21.2 that the Director of the Division of Mental
Health, Developmental Disabilities and Substance Abuse
Services intends to adopt rules cited as 10 NCAC 14C . 1015
- . 1018. . 1149 - . 1160, amend rules cited as 10 NCAC 14C
.1001 - .1002, .1004- .1006, .1010- .1014, .1101 - .1102,
.1114. .1123, .1133 - .1137, .1140. .1148; 14D .0006 and
repeal rules cited as 10 NCAC 14C .1003, .1008. .1103 -
.1105, .1107, .1110- .1111, .1115 - .1121, .1125 - .1131.
.1138- .1139, .1141 - .1147.
Proposed Effective Date: February 1 , 1996.
Instructions on How to Demand a Public Hearing (must
be requested in writing within 15 days of notice): Any
1435 NORTH CAROLINA REGISTER November 1, 1995 10:15
PROPOSED RULES
individual who wishes to demand a public hearing should
contact Charlotte Tucker, Division of Mental Health,
Developmental Disabilities and Substance Abuse Services,
325 N. Salisbury Street, Raleigh, NC 27603, (919-733-4774)
within 15 days of this Notice.
Reason for Proposed Action: The statewide implementa-tion
of the Pioneer Funding System and the Division 's move
away from categorical funding sources has resulted in the
necessity for a complete rules revision regarding accounting
procedures for area programs and contract agencies.
Comment Procedures: Any interested person may submit
written comments and state the Rules to which the comments
are addressed. These comments will be accepted through
December 1, 1995.
Fiscal Note: These Rules do not affect the expenditures or
revenues of state or local government funds.
CHAPTER 14 - MENTAL HEALTH: GENERAL
SUBCHAPTER 14C - GENERAL RULES
SECTION .1000 - ACCOUNTING STANDARDS
FOR ALL RECIPIENTS OF FUNDS
ADMINISTERED BY THE DIVISION
.1001 EFFECT OF THIS SECTION
The requirements of this Section shall apply to all area
programs and their subrecipient agencies receiving funds
administered by the Division and discussed in Section . 1 100
of this Subchapter.
Statutory Authority G.S. 122C-147.1.
.1002 MEMORANDUM OF AGREEMENT
AND ANNUAL SERVICE PLAN
(a) An annual plan and budgot shall bo required from oroa
programs before any state or federal funds administered by
the Division mny be allooated to an area program.—Suoh
annual plan and budgot shall bo in accordanco with Chapter
159 of the Gonoral Statutes. The area program shall
develop and maintain their annual budget in accordance with
G.S. 159.
(b) Tho annual plan and budgot of an area program shall
bo approved by the area board and oignod by the aroa board
chairman. The area program shall prepare and submit to
the Division the annual service plan and Memorandum of
Agreement in accordance with G.S. 122C-143.2. Detailed
instructions are issued annually by the Division.
Statutory Authority G.S. 122C-112; 122C-143.2; 122C-
144.1.
.1003 BUDGET FORM
(a)
—
The annual budget shall be on a standard form
available from tho fiscal sorviooo ooction of tho Division.
Qet)—The otondord form oholl require information on the
ootimatod oxpondituroo and revenue of the area programo.
On an annual basis tho Division Director will iasuo inatnic
tions which apooify tho roquirod infonnatioa.
Statutory Authority G.S. 143B-10.
.1004 REPORTS REQUIRED
(a^
—
iMl programs receiving funds administered by the
Division shall submit quarterly roporto of roooipts and
oxponditufos to tho Division.
(b)
—
Suoh quarterly reports shall bo submitted on a
standard form available from tho Fisoal s«r>'io eo section of
the Division.—Other formats may be used if approved by tho
Division.
(c) Suoh standard form or format shall require a otatomont
of roooipts—and expenditures by major t)'peo of funds
received and expended during the quarter reported on and
during tho fiscal year to date.—Tho amount of suoh roooipts
or oxpondituros shall bo compared to tho annual budgot and
the amount of unrealized receipts and unexpended expondi
ture line items shall be indicated.
(d) Such standard forms or foi'uiat shall bo signed by tho
area director and fiscal officor.
(e) Quarterly reports are to be filed no later than the 15th
of th e month following the quarter being reported upon.
Exceptions may bo made to this date for justifiable roasons.
The Secretary may require reports in accordance with
G.S. 122C-144.1.
Statutory Authority G.S. 122C-112; 122C-144.1.
.1005 ANNUAL AUDIT REPORT
Each program receiving funds administered by the
Division shall submit an annual audit audited financial
statomonts in accordance with requirements of G.S.
122C 132, 122C 1 43, G.S. 159-34 and the Local Govern-ment
Commission. Commisoion by the date indicated on the
approved audi t oontroot or the date indicated on the amended
audit contract.
Statutory Authority G.S. 122C-112; 122C-144.1; 159-34.
.1006 BUDGET REVISIONS
(a) No revision of tho budgot as doscribod in this Section
or transfer of funds from a cost center stated on the budgot
to another cost center shall be made without the prior
approval of tho area board. Tho aroa board may authorize
tho aroa program budgot officer to transfer moneys from
one line item of expenditure to another within the same cost
center as Uotod on the approved budget ordinance subj ect to
written limitations and proooduros tho aroa board proscribes.
All such tronsfora shall bo reported to tho aroa board at its
next regular meeting and shall be entered in tho minutes.
An information copy of all locally approved budget revisions
shall bo forvi'ardod to tho appropriate regional office of tho
Division to tho attention of tho regional accountant.—Area
10:15 NORTH CAROLINA REGISTER November 1, 1995 1436
PROPOSED RULES
programs shall vorif>' that any tronafor of funds is in
oomplionoo with the Divioion'o oooounting rulee in this
Sootion and Sootiop . 1 100 of thio Subchapter and Rule .0006
in 10 NCAC 11D and G.S. 122C 143.—The following
budget revisions shall bo approved by tho regional ofFioo:
f4^ any budget revioion within a oost oenter or
boPiii eon ooot c anters whioh would cause division
funds to bo transferred from one disability area
to another or from one categorical—fund to
another; and
(S^ any budget revision ' 'I'hioh ohongeo client oor
vices OS approved in tho annual plan and budget.
(b) Tho Division shall monitor for budgetary complianco
of expendituree at the cost center total level.
(o) Tho area program budget revisions shall be on a forra
prescribed by the Division.
(d) Approved rovisions or transfers shall bo reflected in
tho next quarte rly report of the area program.—If the
revision affects funds for Titl e XX of the Social Seourit)'
Act. 4 2 U.S.C. 13 97 through 13Q7(f). the next monthly
request for roimbursomont shall reflect tho revision. Caro
shall be taken to assure that budget revisions ore made
timely for Title XX because the Division will not honor
monthly request—for payments—for vi hich tho apprc'ed
budget docs not agroo with request for payment.
(e)
—
The need for each budget revision shall be justified
briefly and explicitly on the aomo form ao the budget
revision, if space f)ormit»:
—
If space doos not permi tT-a
separate form shall bo attached.
(f) Budget reviaionii whioh roduoo oalarieo and wagee and
fringe benefits because of vacant positions shall include in
tho justification a statement explaining how tho current coat
for which tho lapsed salaries are to be used are to bo
supfwrted in oubooquent years.—Lapsed salaries and wages
shall not bo transferred to other line items solely to expend
tho budget, to stockpile commoditiee or to roplaco existing
equipment unless tho existing oquipmont con no longer moot
tho program ncodo for v.'hich it vi'as purchased.
(g) i\rea programs which contract with private or public
sori'icc providers on any basi s other than a unit cost basis,
fixed rote basis, or fee for 6er.'ice basis shall utilize a policy
for budget revisions no l ees string ent than the revision
policy that the Division applies to th e area program. The
area board shall at its discretion allow the area director to
approve budget rovisions from contractors.—It shall bo
neceoGar)' for the area board to incorporate in tho minutes of
a board mooting that the area director has authority' to
approve budget rovisions from contractors.
(h) Tho Kvision shall not participate in any expenditures
not in acoordanoe with an approved budget.
^—The area program shall oonsult with the appropriate
regional office of tho Division for any needed clarification
or assistance.
Revisions to the budget must be in accordance with G.S.
159-15.
Statutory Authority G.S. 159-15.
.1008 INVOICES
Invoices used to bill for oervioeo reoderod by area pro
grame shall bo on a ntondord formi—Suoh form invoioe ohall
require such information as namo and address of purchaoof
,
invoioe date and numbor, doooription of sorviooe rwidorod
and amount of invoioe.
Statutory Authority G.S. 122C-112; 122C-147.
.1010 CO^^TRACT REQUIREMENTS
FOR AREA PROGRAMS
(a) This Rule applies to all contracts between an area
program (hereafter referred to as "contractor") and contract
providers (hereafter referred to as "contractees"). For
purposes of this Rule, contractees include:
(1) an individual with whom a contract is made for
professional services, including consultants and
guest speakers; and
(2) an agency agency, other than another area
program, with whom a contract is made for the
provision of services to one or more clients.
(b) The basis for the relationship between the contractor
and the for-profit or non-profit contractee is the written
contract. All mutual understandings and expectations shall
be clearly stated in the contract. Contracts botwoon a
contractor and a profit or non profit oontraotoo, All
contracts for provision of services to clients, shall contain,
at a minimum, the following provisions as indicated in this
Rule.—Minimum requiromonts for all oontracts shall bo:
Rule, except that Subparagraphs (b'Xll) and (b) (IS) of this
Rule shall not apply to contracts with individuals:
(1) names of the contracting parties;
(2) beginning and ending dates of the contract
period; however, no contract shall extend be-yond
the fiscal year; years, except as allowed by
G.S. 159;
(3) detailed description of the services to be pro-vided
and the expectations of the parties;
(4) amount and method of payment;
(5) address and social security number or IRS
identification number of contractee;
(6) the following statement when a contract period
is greater than 30 days: "This contract may be
terminated at any time upon mutual consent of
both parties or 30 days after one of the contract-ing
parties gives notice of termination;"
(7) a statement which indicates that the contract may
be terminated immediately with cause upon
written notice to the other party; the cause shall
be documented in writing to the other party
detailing the grounds for termination; and if
applicable, the contract may contain a provision
indicating method of payment of liquidated
damages uf>on such termination;
(8) a clause which indicates that the contractor
(area) is held harmless from acts committed by
the contractee;
1437 NORTH CAROLINA REGISTER November 1, 1995 10:15
PROPOSED RULES
(9) signature of each party to the contract; and
(10) a pre-audit statement in accordance with G.S.
159 28 . 159-28;
(o) Additional roquiromonto when oontmoting with a profit
or non profit oontraotoo shall bo oo followo:
(11) fi^ either a Division approved unit cost baais or
the total coot basis (lino item budget) shall bo
utilized; a statement specifying the procedure for
budget revisions, if applicable, and provisions
for fund balance; and a statement which in
cludoo!
(12) (A) the procedure for resolving disagreement
between the contracting parties;
(13) (^ for total ooot oontracto, for equipment pur-chased
with non unit cost reimbursement funds,
such as start up or special purpose funding, title
to assets purchased under the contract in whole
or in part rests with the contractor so long as
that party continues to provide the services
which were supported by the contract; if such
services are discontinued, disposition of the
assets shall occur as approved by the Division;
(14) (€) client records of the contractee shall be
accessible for review for the purpose of monitor-ing
services rendered, financial audits of third
party payors, research and evaluation;
(15) (©) upon request, the contractee shall provide
data about individual clients for research and
study to the contractor;
(16) (E) the contractor requirement to provide to the
contractee all pertinent rules, regulations, stan-dards
and other information distributed by the
Division necessary for the performance of the
contractor under the terms of the contract;
(17) (F) the contractor requirement to monitor the
contract to assure compliance with rules of the
Commission, the Secretary and G.S. 122C-142;
(18) (G) a copy of the independent audit referenced
in Subparagraph (e){4) (b)(20) of this Rule, if
required, shall be forwarded to the Office of the
State Auditor at 300 North Salisbury Street,
Raleigh, North Carolina 27603-5903.
(19) (3) provisions which outline the responsibility of
the contractee for the adoption, assessment,
collection and disposition of fees in accordance
with G.S. 122C-146;
(20) ^ a requirement that the contractee shall make
available to the contractor its accounting records
for the purpwse of audit by State authorities and
that the party will, when required by general
statute or in accordance with APSM 75-1,
Section 4.2, have an annual audit by an inde-
[jendent certified public accountant.
(c) Agreements with another area program for provision
of services to clients shall be incorporated into the annual
Memorandum of Agreement referenced in Rule .1002 of
this Section.
Statutory Authority G.S. 122C-112; 122C-141; 122C-142;
122C-146; 159-40; 143-6. 1.
.1011 FUND ROUTING
Except as authorized by the General Assemblv:
(1) (a^ all All oommunity related state and federal
funds allocated by the Division for the operation
provision of community aduk mental health, child
mental health, mental retardation, aloohol and
drug abuoe programe developmental disability and
substance abuse services shall be allocated to
through the area program, program unloos other
wioe required by the grantor of ouoh funds to the
Division.
(2) (b) Programs providing mental hoolth, mental
rotxirdation and oubotanoo abuse oervioos which
oeri'e more than one oatohment area and are not
imder a looal mental health authority' may reoeivo
oommunity funds directly from the Division, the
Division mav allocate and contract directly for the
provision of non-treatment activities including but
not limited to administration, training and preven-tion.
Statutory Authority G.S. 122C-112; 122C-147.1;122C-131.
.1012 DENIAL, DELAY OR REDUCTION
OF PAYMENTS
The flow of funds under any of the funding programs
dioousood in Sootion .1100 of this Subchapter shall, oo
determined by the Division Director, bo delayed or cancolod
to programs which do not timely make all reports required
by this Section. The Division may delay, reduce or deny
pavments to area programs in accordance with G.S. 122C-
151.
Statutory Authority G.S. 122C-151.
.1013 RECOVERY OF DIVISION FUNDS IN
NON-COMPLLVNCE SITUATIONS
(a) The Division shall review all non-compliance situa-tions
occurring in area programs to determine if division
funds were involved in the non-compliance situations.
Non-compliance situations are those situations or actions that
occur which are not in accordance with division, depart-ment,
state, and federal rules, policies, regulations, or
statutes.
(b) The basis for determining if division funds wore
involved in the out of oomplianoe situation shall bo the
Division's effective rate of participation, if any, in the
situation, shall be determined in accordance with Section 20
of Volume IV of the Pioneer Funding System Operating
10:15 NORTH CAROLINA REGISTER November 1, 1995 1438
PROPOSED RULES
Manual.
{^ Tho offeotive rate of division participation for
aroa matching oupported ooot ohall bo determined
on on individual cost contor basis by dividing tho
aroa matching funds allocatod for tho )'oar by tho
total budgeted expendituroo inoludod in that ooot
oenter.
(3) TTic offootivo rato of division participation for
tho division's catogorical funds shall bo dotor
mined by dividing th e oategorioal fund per ooet
center involved by the total budgeted expendi
turog in tho coot oontor or cost contors Lnvolvod.
(c) Division participation in non-compliance situations
shall be recovered through receipt of a check or by reducing
the current year's allooation of payment of allocated division
funds otherwise due the area program . Tho Regional
Director shall notify' tho Director of tho aroa program of the
proposed re>duotion and the reaoono for tho reduction on a
standard form to bo provided by the fiocal oer<'ioeo oeotion
of tho Division.—Throo oomplotod copies of this form shall
bo sent to tho Division's chiof of Fiscal sorvicoe by tho
Re gional Director so that neoeooar)' accounting entrioo to
re flect the reduction con be recorded in the Division's
accounting rocorda if no app>oal is Filed in accordanco with
(f) of this Rule.—If tho Division's allocation for tho Fiscal
year has already boon dmv.Ti doviTi when the non compliance
situation becomes known, the The area program shall
reimburse the Division within 60 days of being invoiced or
notified of the required payback, unless notiFication of
appeal is rendered by the Area Authority .
(d^
—
If, for the Fiscal year in which the non compliance
situation occurred, the offoctivo participation rate at tho ond
of tho Fiscal year basod on actual annual expenditures is
different than the rate used at the time of the reduction of
division funds, an adjustment shall be made to reflect the
increased amount duo to tho Division or to credit tho amount
overpaid by tho area program against any amount duo.—H
no amount is due from the area program Vi hioh con be
credited with the overpniymont, the Division shall refund the
overpayment from available funds within tho operating
budget p>onding any nocessar>' approval required by tho
Division of State Budget.
( e) I'Vny non compliance amount determined at the end of
the Fiscal year in tho Division' s tentative settlement report
shall bo handled in a mannor consistent with (b)(1) and
(b)(3) of this Rule.
(d) (f) If the Director of the area program disagrees with
the non-compliance decision, thea within 60 days of receipt
of the notiFication of non-compliance, the Director of the
area program shaii may send to the Division Director a
request for appeal pursuant to G.S. 122C-145, 122C \A1
and 10 NCAC IK .0900 (DHR Administrative Standards).
(e) (g) Pending the final agency decision on the appeal of
the non-compliance decision, the Division shall not with-draw
or reduce the amount of funds due the area program.
Statutory Authority G.S. 122C-112; 122C-147.
.1014 EXPENDITURE OF DIVISION FUNDS
SETTLED ON AN EXPENDITURE BASIS
(a) The Division shall allow area programs to may budget
division catogorical funds within cost centers that also
include, but are not limited to, local funds, aroa matching
funds, federal funds or other division oategorioal funds.
When area programs elect to budget division oategorioal
fiinds within a cost center that is settled on an expenditure
basis with such other funds, funds shall be considered to
have been expended in the following order: the Division
shall oonflider the Division oategorioal funds to be expended
under tho following criteria:
fi) For area program op>oratod oori'ioos!
(1) (A) special grants from non-divisional sources
that are for reimbursement of the same expendi-tures
as those for which divisional categorical
funds are appropriated (examples are grants
from R.J. Reynolds , the Department of Public
Instruction or Division of Youth Services -
Community-Based Alternative Funds);
(2) (B) block grant funds federal funds from the
Division; and
(3) (G) state oategorioal funds from the Division.
Revenue from non-divisional sources and block
grant funds shall be deducted from total cost
center expenditures for the purpose of determin-ing
the net cost upon which the state oategorioal
share is based. Client-earned income, such as
payments received from patients or third parties
(insurance, Medicare, Medicaid), which is
received but not expended shall be retained by
the area program, or tho contract program and
bo UBod to further tho objoctivoa of tho logisla
tion establishing the state oategorioal funding.
When olient earned income rooults in on area
program's fund balanoo being in oxooas of 15
percent of its annual—operating budget.—tb©
amount in exoeso of 15 percent shall be handled
in aooordanoo with the Division's rule on fund
balances, Rule .1125 of this Subchapter.
(3) For contracted programs:
(A) The area program shall eotablish on expendi
ture and fund balance policy.
(B) For contracted sori'icos, each contract shall
detail how tho oxpondituro and fund balanco
policy will apply to the contracted oer<'ice.
(€) If the area program contracts with a provider
that also provides non aroa program oontrao
tual seri'iooQ, tho contracted provider shall bo
required to identify the fund balanoe for the
area program contracted service only.
(b) Expenditures for Social Services Block Grant total
cost programs shall continue to bo budgeted and expended
in aooordanoe with applioable Title XX matohing formula
and eUgibilit)' criteria. Settlement of Willie M. and TTiomas
S^ funds shall be in accordance with Rules .1 136 and .1 148
of this Section, respectively.
1439 NORTH CAROLINA REGISTER November 1, 1995 10:15
PROPOSED RULES
nftof apooittl granto from non divioional oouikmw bo long aa
theoe funds do not supplant local or state funds.—For the
purpose of determining whether blook grant fundo ore boing
uflod to supplant looal of state funds within a ourfont yoof,
the prior year oxpondituro data shall bo used.—All rovonuos
retailting from the blook grant funded projoot shall bo uood
by the service whioh produced the revenue.—If existing
9or>'ico8 cannot bo oxpandod or now sor^'icos started, tho
rovonuos shall bo used to roduoo the amount of block grant.
Statutory Authority G.S. 122C-112; 122C-147.
(o) State and Social Sor^'icoo Blook Grant adult develop
mental activit)' program funding ohall, unleoo a total coot
method of roimburoomont is authoriEed by tho Division, be
baaod upon a unit ooot rato determined by ooot studies
conducted by division staff.—Tho roimburoomont rato shall
be booed upon actual net cost (total ooot less other oourcea
of support) or tho otatewido maximum rate, whichever is
(d) State subsidy payments for dovolopmontal disabilitios
da)' pare and developmental dioabilities community residen
tial oen'ioo shall continue to be reimbursed on a statewide
(o) Block grant fundo shall bo the first dollar expended
.1015 FUND BALANCE: COMPUTATION FOR AREA PROGRAMS
(a) In order for the Division to have input into the actions regarding fund balances in area programs, the following shall
take place after the certified public accountant's audit report is rendered and the tentative settlement report prepared:
(1) The fund balance set forth within the annual audit of area programs shall be verified by the Division.
(2) Since single county area programs are considered a department of the county for budgetary and financial
reporting, separate fund balances for the single county area programs are not required. In order to assure that
single county area programs are in compliance with the G.S. 122C-146 which states that fees received for
services shall not reduce or replace the budgeted commitment of local tax revenue, the Division shall review the
utilization of county general funds and the disposition of fees received for service each year.
(3) To determine the unrestricted fund balance for a multi-county area program or single county area program which
maintains a separate fund balance and the percent that it represents to the operating budget, the Division shall
use the following format:
Current Assets Per Audit Report
Less: Current Liabilities Per Audit Report
Fund Balance
Less: Reserve for Encumbrances
Reserve for Patients Accounts Receivable
Less: Allowance for Doubtful Accounts Patient
Accounts Receivable
Reserve for Accounts Receivable from Governmental Entities
Reserve for Inventory
Reserve for DWI Fees
Reserve for Drug Education School Fees
Reserve for Restricted Donations
Fund Balance Restriction Previously Approved by
DMH/DD/SAS
Willie "M"
Thomas S^
Other(List)
$
L 1
%.
i 1
i £ i
i 1
L i
L i
i 1
i i
i 1
L i
£ i
i 1
Unrestricted Fund Balance
Currently approved budget including expansion
Percent Unrestricted Fund Balance to Current Annual Budget percent
£4} If the unrestricted fund balance is not in excess of 15 percent of the current annual budget, no action is to take
place.
(5) If the unrestricted fund balance is over 15 percent of the current annual budget, the Division shall recoup in
an amount equal to the fund balance in excess of J_5 percent in accordance with Tentative Settlement Report
procedures per APSM 75-1. Section 4.3. The area program may request permission from the Division Director
to restrict fund balance in excess of the 15 percent limitation for specific purposes.
10:15 NORTH CAROLINA REGISTER November 1, 1995 1440
PROPOSED RULES
(h) The amount of reduction of financial support by the division to area programs as referenced in Subparagraph (a'XS)
of this Rule may be decreased and/or delayed if there are extenuating circumstances which, in the opinion of the Division
Director, warrant relaxation of this policy. Any action taken in regard to this Paragraph shall be documented in writing.
Statutory Authoritx G.S. 122C-1 12(a)(6): 122C-144; 122C-146; 122C-147; 143B-10; 159-8.
.1016 DISPOSITION OF EQUIPMENT - NON UCR
(a) Equipment costing five thousand dollars ($5.000) or
more purchased with non-UCR Division funds by an area
program or contract provider shall be used for Division
funded client services. Except for Willie M and Thomas S^
funded purchases, equipment purchased with Division funds
may be transferred to other Division funded ser.'ices if no
longer needed by the original service. Willie M and
Thomas S^ purchased equipment shall be used only for
Willie M or Thomas S^ clients or disposed of in accordance
with Rule . 1 136 or . 1 148 of this Subchapter.
(b) Except as stated in Paragraph (c) of this Rule, should
transfer of equipment to Division funded services not be
possible, the Division shall be contacted by the area pro-gram
or through the area program for a contract provider
for disposition instructions. The Division will recover the
Division's share of the fair market value. The Division's
share will be established by the following methods in order
of preference.
( 1
)
Through inventory records which establish the
percent of funding for the equipment.
(2) The Division's percent of participation for the
area program for the year of purchase.
(3) Tlie Division's percent of participation for the
area program for the current year.
(c) Equipment which is fully depreciated and no longer
has any useful value may be disposed of in accordance with
area program policy.
(d) Tlie area program will have a written procedure
stating the equipment disposition policy for contract provid-ers
and include or reference this provision in aH contracts
between the area program and the contract provider.
Statutory Authority G.S. 122C-147.
.1017 START UP FUNDING
(a) The Division may provide funding outside of UCR for
initial purchases of equipment, supplies and operational
expenditures for the establishment of a program, ser\'ice or
facility.
(b) Requests for start up shall be made by the area
program, or through the area program in the case of a
contract provider, in whose catchment area the new pro-gram,
service or facility is being established. Requests shall
be made in writing to the Division Director or designee and
shall include a line item budget and justification. Requests
may include expenses for normal operation such as staff,
utilities and rent but such request may not exceed 60 days
without specific written authorization. Approvals will be
granted based on availability of funds and merit of request.
Statutory Authority G.S. 122C-147.
.1018 AREA AUTHORFTY FINANCIAL
FAILURE DEFINED
(a) An area authority is in imminent danger of failing
financially if the Division determines at any time that one or
more of the following conditions are met:
(1) The projected annual expenditures of the area
authority exceed the sum of the projected annual
revenues and fund balance of the authority and
the governing board of the authority has not
demonstrated an ability or willingness to take
appropriate action to correct the imbalance: or
(2) The area authority has not complied with the
reporting requirements of G.S. 122C-124. as set
forth in the annual Memorandum of Agreement
between the Division and the area authority.
fb) An area authority is in imminent danger of failing to
provide direct service to clients if it is in imminent danger
of failing financially as defined in this Rule.
Statutory Authority G.S. 122C-125.
SECTION .1100 - STATE AND FEDERAL
FUNDS ADMINISTERED
.1101 METHOD OF PAYMENT
(a) Grontfl deooribed in thio Section shall bo made for tho
ficool year.
(fe) An advance of 1/12 of tho total annual allocation of
grants shall be made to tho area program at tho beginning of
tho fiooal year.—Advanoemento of more than 1/12 may bo
made if jiuitifi ed and authorized by the Divioion.—Applioa
tions for advonoomonts of moro than 1/12 shall bo made in
writing.
(e) Funding oubsoquent to tho advonoement shall bo mado
on a monthly or quarterly basis-
Payment will be based on earnings, monthly advancement
or other basis as authorized by the IDivision and stated in the
Memorandum of Agreement.
Statutory Authority G.S. 143B-10.
.1102 REQUEST FOR FUNDS
A monthly or quarterly request for funds administered by
the Division and paid on a basis other than unit cost earn-ings
and alf<Midy ollocatod to tho aroa program and doooribod
in this Section shall be on a standard form format available
from the fiscal services section of the Division. Such
standard forms shall roquiro inforrration on typo of payment
requested (whether advance or on a roimburoomcnt basis).
1441 NORTH CAROLINA REGISTER November 1, 1995 10:15
PROPOSED RULES
the baoia of tho roport (wbothor cash or nooruod oxpondi
turoo), tho grantee idontifying number, the month oovered,
name of grantee organization, tho name of the payee if
different from grontoo, computation of tho amount ro
quoBtod, tho annual budget amount and tho name and
signature of tho authorized official submitting tho requeot.
Request shall be submitted to the Fiscal Office as directed
by the Division Director.
Statutory Authority G.S. J 43B-10.
.1103 AREA MATCHING FUNDS
(a) Eligibility'. Tho Division shall mako available to aroa
progromo area matching funds appropriated to the Division
under tho authorization of G.S. 122C 1'19. To be eligible
for such fiinda an area program shall moot tho roquiromonts
of tho Btondiu-ds in 10 NCAC 1 8M regarding foquirod
sorviooo and shall have an approved annual plan.
(b) Match Basis.—Area matching funds shall be granted
to aroa programs on a matching basis.—Tho amount of tho
match shall bo as dotorminod by tho Division's abilit)' to
fund formula for each program, but shall bo no less than
one for one (50 poroont) or more than nine for one (90
percent) subject to available state appropriations.
(c) Matching Monios.—Local monies that are eligible for
matching with state monies under G.S. 122C HQ include,
but are not limited to tho county and city general fund,
voluntary' contributions, patient fees, insurance rocoipts.
Medicare, federal and local share of Medicaid, ABC five
cento on the bottle, and ABC seven percent profits.—Local
monios expended for rental or purchase of office or facility
space, and for renovation of buildings shall not bo eligible
for matching funds.—But local monios oxfwndod for pur
chase of motor vehicles when the end result would be a cost
reduction or for renting equipment when such equipment is
clearly more justifiably rented than purchased may be
eligible for matching with aroa matching funds.
(d) Application.—Application for area matching funds may
be made by submitting an annual plan and budget to the
appropriate regional office.
(o) Allocation Among Regional Officoa.—Aroa matching
funds shall be allocated annually by the Director of the
Division among the regional offices.
(I)
—
Allocation of Funds.
(4) Each Regional Director at the discretion of the
Division Director shall—allocate
—
among the
eligible programs of his region the area match
ing funds allocated to his region.
(3) Priority for allocating fiinds will bo dotormined-each
year by the Division Director in accordance
with approved annual plans.
Statutory Authority G.S. 122C-112; 122C-149; 143B-10.
. 1 104 FUNDING GROUP HOMES FOR
EMOTIONALLY DISTURBED CHILDREN
(«3 Pursuant to G.S. 122C 150, tho Division shall
administof a program of grants to area programs to bo
called funds for group homes for emotionally disturbed
children.
(b) Such gnmts shall bo usod to support group homos for
emotionally disturbed children.
(e)
Funds for group homos for emotionally disturbed
children shall be administered to area programs as direct
grants and do not require local matching.
(d)
—
Programs may spend funds for group homos for
emotionally disturbed children for the following:
ft) to rent or loaso fooilitiooi
(3) fiimitufo or speciolizod equipment for residents'
(3) transportation of residents;
f4) other nooosoor)' of>erating expenses as approved
by the Division; and
(5) tho purchase, construction or alteration, im
provomont or repair of a facility by the area
program or a non profit board with division
approval. The program shall meet the require
monts of tho following!
fA)
The Group Homo Mortgage Payment Program.
The Division may participate in the mortgage
payment program in part or in total dependent
upon tho availability' of state funds.
(^—?%e
—
Group—Heme
—
Purchase/Construction
Program.
(i) The Division may participate in the down
payment and lump sum purchase or con
stniction of a group homo in whole or part
contingent upon the availability of state
fiinds.
fii) Tho area progmm or non fHofit board shall
secure two property appraisals for review
and approval by the Division prior to
purchase
(i«)
—
If a now construction grant is requested,
tho aroa program shall submit two con
struotion bid contracts from tv.'o building
contractors to the appropriate regional
office for review and approval prior to
construction bid letting.
(€)
—
A request for initial renovation of a newly
acquired—facility of five thousand dollars
($5,000) or loQO shall bo submitted to tho
appropriate regional office of tho Division for
approval.—Initial minor repairs to facilities of
less than one thousand dollars ($1,000) shall
bo approved by tho area program.
(©)
A request for alteration or improvement of an
existing facility' in excess of five thousand
dollars ($5,000) shall be forvv'arded to the
Division Director's office through the appro
priate regional office of the Division for ap
proval. ^—Each request aa outlined in (d)(5)(B) and (D)
of this Rulo shall bo accompanied by a narra
tive that explains the need for the purchase.
10:15 NORTH CAROLINA REGISTER November 1, 1995 1442
PROPOSED RULES
construotion. altomtion, improvomont or repair
of tho facility and a oopy of the sobematio
drawings and spooifioationo.—If approved by
the Division of Mental Health, Montal Rotar
dation and Subotanoo Abuso Sorviooa, thoeo
dmvvingD and opooifioationD oholl be forvi.'arded
to tho Division of Facility Sers'iooo for roviow
and approval.
(F)
—
If tho group homo is operated by a non profit
board, the area program shall sign a legally
binding oontraot with the private non profit
agency for either tho mortgage paymonta to bo
mndo or the purchase or construction program
as indicated in (A) and (B) of (d)(5) of this
Rule .—A oopy of the appropriate oontraot shall
bo obtained from the controller's office of tho
central offico of tho Division.
{&)—If a facility owned by an area program or its
private non profit contract agency wao pur
chased.—altered,—improved,—or rehabilitated
using division fiinds and lator ccosos to bo used
in tho delivery of oeri'ioes to clients by the
area program or its private non profit oontraot
agency, tho facility shall bo sold at tho current
fair market value as determined by tv.'o inde
pendent appraioolo aooeptablo to the Division.
Tho Division shall be reimbursed a pro rata
share of the proceeds of the sale based on tho
percent of contribution made by the Division
in tho purohooe , alternation, improvement or
rehabilitation.—The area program shall main
tain records—on a oontinuouo basis vi'hioh
rofloct tho amount of contribution for pur
chase , alteration, improvement, or rehabilita
tion by the Division, area program or other
funding entity.
(e)
—
Fund Balance.
(i^ The Division may allow group homos for omo
tionally disturbed children to maintain a fund
balance of no more than—15 percent of the
current annual budget for tho group homo.
(3) The 15 percent fund balance shall be generated
entirely by non state funds.
(^) The Division may docroaoo state appropriation to
a group homo, thereby necessitating tho group
home to utilize its fund balance, if the state
appropriation is required in order to continue
operations at another home.
(43 The 15 percent fund balance allowed shall bo in
addition to the amount the Division would allow
to remain in the fund balance due to restricted
donations.
{&^ Except for tho roatricted donations and tho 15
percent fund balance , funds for group homes for
emotionally disturbed children shall be expended
(6) An allowance for a fund balance for group
homos that oro opwratod by on area program is
made in Rule .1125 of thio Sootioni
(f)
To apply for funds for group homos for emotionally
disturbed children, an annual plan and budget for such funds
shall bo included in tho appropriato area program's total
annual plan and budget package when it io submitted to tho
appropriate regional offioe of the Division.
fg)
Funds for group homes for emotionally diaturbod
childron shall bo allocated among tho regions of tho Division
by the Division Director.
(h) Boood on the appro'i
'ed annual plan and budget roquoot
submitted and availability of funds , allocations of funds for
group homos for emotionally disturbed childron to aroa
progrtmifl within each region shall be made by the Division
Director or his designee-
Statutory Authority G.S. 122C-1 12(a)(6); 122C-131;
122C-147; 122C-150; 143B-10.
.1105 FUNDING EARLY INTERVENTION
FOR THE EMOTIONALLY DISTURBED
{tt)—In furtherance of G.S. 122C 150 tho Division shall
maintain a program of granto to programs for tho establish
mont of local programs of consultation, training, diagnosis,
and trcatmont of emotionally disturbed childron, ages birth
to seven years and to th e familieo of suoh ohildron.—Tbe
focus of thooo programs shall be:
(4^ to improve the quality of child care environ
monta through tho training of day core workers,
nursery school teachers,—parents, and others
involved in child care ;
(3) to identify', through sorooning and diagnosis,
those children with emotional and other develop
mental problems; and
(3) to provide remedial programs either through
consultation or through spocializod thompoutic
proschool programs to those childron and their
familieo identifi ed ao being in nood.
(fe)
Funds for early intervention for the emotionally
disturbed shall bo administered to area programs as direct
grants and shall require no local matching.
(e)
Funds for the early intep.
'ention for tho emotionally
disturbed may be utilized for repairs and maintenonoo of
faciUtiofl which roprosont normal upkeep and do not materi-ally
increoao the value of tho facility or extend its useful
(4)
To apply for funds for early intepi'ontion for the
emotionally disturbed on annual plan and budget for such
funds shall bo included in the appropriate oroa program's
total annual plan and budget package when it is submitted to
the regional office of the Division.
(e)
—
Funds for early intervention for tho emotionally
disturbed shall bo ollooatod by tho Diroctor of tho Division
among the regional offices.
(Q
—
Baaed on the annual plan and budget submitted and
availabihty of funds, allocation of funds fof early intorvon
tion for tho emotionally disturbed to area programs within
1443 NORTH CAROLINA REGISTER November 1, 1995 10:15
PROPOSED RULES
oaoh rogion ohall bo mado by the Rogional Diroctor with the
oonourronoo of the Divioion Dirootor.
Statutory Authority G.S. 122C-112; 122C-150; 143B-10.
.1107 COMMUNITY SUBSTANCE ABUSE FUNDS
(a) The Divioion ohall adminiotor a program of granto to
area programa to bo called Communit)' Substtinco Abuoo
Funda.—Those funds shall bo adminiatorod as direct granto
not requiring local matobT
(b)
—
Programc operated by an area program or contract
programs of the area progmm arc eligible for funding of the
following oxpondituroo:
fi) otafFmg;
(3)- travel;
(5) aupplieo;
f4) administrative and program equipment;
(5) rent or leooe of a residential facility;
(j^ other neoeooar)' program noodo ao approved by
the Division; and
f?) repairs and maintenance—of facilities which
roproQont normal upkeep and do not materially
increase the value of the facility or extend its
useful life.
(c) Community' Substance Abuse Funds may bo used for
the purchoDO, construction or alteration, improvement or
repair of a residential facility' by the area program or a
nonprofit board under contract with the area program with
division approval.—The program shall meet the following
requirements:
(4^ The Residential—Faoilit)'—Mortgage
—
Payment
Program.—The Division may participate in the
mortgage payment program in port or total
oontingont upon the availability' of state fundoj
(3) The Residential Facility Purchase/Construction
Program.
(A)
—
The Division may participate—in the down
payment and lump sum purchase or oonotruo
tion of a residential facilit>' in whol e or part
contingent upon the availability of state funds .
^S)—The area program or nonprofit board shall
secure two property appraioolo for review and
approval by the Divioion prior to purohooe.
^G)—If a now construction grant is requested, the
area program shall submit two construction bid
contracts from t>vo building contractors to the
appropriate regional office for review and
approval prior to construction bid letting.
(3) A request for initial renovation of a newly
acquired faoihty of five thousand dollars ($5000)
or l ess shall be submitted to the appropriate
regional office of the Division for approval.
Initial minor repairs to facilitios of loss than one
thousand dollars ($1000) ohall be approved by
the area program.
(4) A request for alteration or improvement of an
existing facility—in oxcoss of five thousand
doUaro ($5000) shall bo forwardod to the Divi
oion Director's office through the appropriate
rogional office of the Division for approval.
(5) A requoot for alteration or improvemopt of an
existing facility of five thousand dollars ($5,000)
or loss shall be submitted to the appropriate
regional office for opproval.
(6) Each request as outlined in (o) (2) and (4) of thi s
Rule shall be accompanied by a narrative that
explains tho nood for the purohaoo, oonDtruotiont
alteration, improvement or repair of the facility
and a copy of tho schematic—drawings and
spooifioations.—If approved by tho Division of
Mental Health, Mental Retardation and Sub
otanoo Abuse Ser<'ioes,—these dravi'ings and
gpecifioationfl shall bo forv^'arded to tho Divioion
of Facility Sor.'ioo8 for review and approval.
(p^ If the residential facility is operated by a non
profit board, the aroa program shall sign a
legally binding contract with the private non
profit agency for either tho mortgage payments
to bo made or the purohooe/conotruotion program
ao indicated in (c) and (1) and (2) of this Rule.
A copy of tho appropriate contract shall bo
obtained from tho Fiscal Services Branch of tho
central office of tho Division.
(8) If a facility owned by an area program or its
private nonprofit contract agency was purchaood,
altered, improved or rehabilitated using division
fiindo and later coasea to be used in the deliver)'
of oor>'icoo to cliento by the area program or its
private nonprofit contract agonoy, the facilit)'
shall bo sold at tho current fair market value as
determined by two independent appraioolo ao
ceptable to the Divioion. The Divioion shall bo
reimbursed a pro rata share of tho proooods of
the sole booed on tho p>orcont of contribution
made by the Division in the purohooe , alteration,
improvement or rehabilitation.—If an area pro
gram or its oontroot progrom wishoo to retain o
facility that was purchased, altered, improved or
rehabilitated uoing fundo for Communit)' Sub-otanoe
Abuse Fundot the aroa program or its
oontmot program shall pay to the Division a pro
rata shore of the current fair market value of the
facility as determined by two independent op
proisalo oooeptablo to the Division booed on
contribution mode by tho Division in the pur
choflo oltorotion, improvement or rehabilitotion
of the focilit)'. This provision may be waived by
the Divioion Director Ufwn Vi'ritten request of tho
progrom. Tho area program shall mointoift
records on o continuous bosis which reflect tho
amount of contribution for purohooe , olterotion,
improvement or rohobilitation by the Divioion,
area program or other funding entity.
(d^
—
Fund Balance.—Tho Divi sion may allow area pro
10:15 NORTH CAROLINA REGISTER November 1, 1995 1444
PROPOSED RULES
grama or contmct progmms to tnaintain a fund balonco of no
more than—15 poroent of the current annual budget in
aooordanoo with Rule .1125 of thio Sootion.
(^—For an area program to apply for community' sub
stanoo abuse funds, an armuxil plan and budget for auoh
fundo shall be inoludod in tho appropriate oroa program's
total annual plan and budget package when it is oubmJtted to
the appropriate regional office of the Division.
{4)—Based on tho annual plan and budget submittod and
availabiUt>' of these funds, allocationo shall be made yearly
among area programii by the Director of the Division or his
designee.
Statutory Authority G.S. 122C-112; 122C-147; 143B-10.
.1110 SOUTH CENTRAL REGIONAL
ALCOHOLISM PROGRAM FUNDS
(a) In furthoranco of tho authorization of G.S. 122C 1 8 1,
adopted pursuant to G.S. 150B l1(o). th e Division shall
administer a program of grants to bo known as south central
regional alcoholism program funds.
(b) South central regional alcoholism program fundo shall
bo made a'.'ailable to the south central region by tho Division
for alcohol programs in area programs to help eomponsato
for that region's not having on alcoholic rehabilitation
cente r.—These fundi; shall be used to supplement the existing
alcoholism programo and to provide oood money svhere an
alcohol program does not exist.
(c) South central regional alcoholism program funds shall
bo administered to area programs oo direct gronto not
requiring local matching.
(d) South central regional alcoholism program funds may
bo utilized for repairs and maintenance of facilities which
represent norrml upkeep and do not materially inoreaoe the
' alue of the faoilit)' or extend itc U£ieful life .—If approved on
an individual basis, purchasos of equipment as well as
payment of minor renovation expenses shall be allowable
uses of south central regional alcoholism program funds.
fe^ To apply—for south central—regional—alcoholism
program funds, an annual plan and budget for such funds
shall be included in the appropriate area program's total-
annual plan and budget package when it is submitted to the
regional office of th e Division.
ff)
—
Based on tho armual plan and budget submittod and
availability' of funds, allocation of south central regional
alcoholism program funds to area programs is made by the
south central R.egional Director with th e oonourrenoe of the
Division Director.
Statutory Authority G.S. 122C-112; 122C-181; 143B-10.
.1111 DRUG ABUSE NLVTCHING FUNDS
(a) Under G.S. 122C 1 47 the Division shall administer a
program of grants to area programc to provide funds for
sepi'ioes relative to the treatment and prevention of drug
abuse.
(b) Drug abuse matching monies shall be administered to
area programs on a match basis.—Tho match ratio for each
area program shall be in oooordonoe with Rule .1103(b) of
this Sootion.
(c) Local monies that are oligiblo for matching with state
drug abuse matching funda shall include, but shall not bo
Limited to, the oount)' and oity gonorol fundo, oontributiono,
patient and drug fooo, and umuranoe and Mediooid roooipto.
(d) Subject to tbo availabilit>' of state drug abuse nmtohing
furtdfl tho E>ivi3ion Diroctof of hia dooignoo may approve tho
use of these fundo to provide treatment serviooo to inoaroor
at e d cli ents provided that no more than 25 percent of tho
clients boing served by tho program may bo incarcerated.
iMthough incarcerated, tho following olionto ore excluded
from tho 25 percent limitation:
(43 oliento who have boon admitted to treatment and
are serving on tho first 30 days of their son
tence;
(3) clients who havo 60 days remaining to oen^e
prior to rel eaoe from inoaroemtion; and
(^) clionts incarcoratod in local jails and juvooilo
detention facilitioo.
(e)
—
Local expenditures for repairs and maintononoo of
faoUitiee which represent normal upkeep and do not materi
ally inorooflo tbo value of tbo facilit)' of extend its uaoful life
shall bo oligiblo for inatching with drug abuse matcMBg
funds.—Approval of expenditures for rent and equipment
rtay be made on an indi'i'iduol baoie by tho Division Dirootor
or his designee.
(0 Vi^on costs of personnel are shared by more than ono
drug grant, a time distribution record shall bo maintainod
for each staff member performing ser^'ioos charged to
separate grants.
(g) To apply for drug abuao matching funda on application
for such fundo shall be submitted by tho area program
simultaneously to the appropriate Regional Director and to
tho Doput)' Director for substance abuso.—j\n annual plan
and budget for such funda shall also bo included in tho area
program's total annual plan and budge t package.
(h) The Regional Directors shall recommend to the
Doput)' E)iroctor for substance abuse the allocation of drug
abuse matching funds to oligiblo area programs within theif
regions.
ft)
Based on the annual plan and budget submittod and
availability of fimds, allocation of drug abuse funds to area
programs shall bo mode by tbo Division Director or bis
designee .
Statutory Authority G.S. 122C-112; 122C-113; 122C-147;
122C-150; 143B-10.
.1114 EARLY INTERVENTION - STATE
AND FEDERAL FUNDS
(a) Tbo Division shall administer a program of grants to
area programs to be oall ed fundo for early intepi'ontion for
children with mental retardation or other developmental
disabilities.
(b) Such gronta shidl bo uaod to provide for tho establish
1445 NORTH CAROLINA REGISTER November 1, 1995 10:15
PROPOSED RULES
mont of local multidi8ciplinar>' toamo for tho proviaion of
program oonoultation, family support and family oontered
training for preoohool ohildron, (defined as those who have
not roachod thoir fifth birthday on or before October 15 of
tho ochool year) within tho following guideliDoo:
fi) Children oor^'ed shall bo mentally retarded,
dovelopmontoll)' di sabl ed, developmentally
delayed or have at)'pical dovolopmont or bo at
risk for one of those conditions.
(3^ Priorit)' shall be given to those children under
three years of age.
(c) To apply for funds for early intori'ontion, an annufll
plan and budget for such funds shall bo included in the
appropriate aroa program's total armual plan and budget
package when it is submitted to the regional offioe of the
Division.
(d) Funds for early intori'ontion shall bo allocated among
the regions of the Division by the Division Director.
(o) Booed on the approved annual plan and budget request
submitted and availability of funds, allooation of funds for
oarly intorvontion to area programs shall bo approved by tho
Division Director or hio designee.
(a) The Division shall administer a program of grants to
area programs for early intervention services for children
and their families, in accordance with Part H of the Individ-uals
with Disabilities Education Act (IDEA).
(b) Funds may be used for any periodic or day/night
service that is identified as needed in the Individualized
Family Service Plan (fFSP) within the following guidelines:
m children served shall be those with developmen-tal
delays, atypical desfelopment or those at risk
for these conditions as defined in JO NCAC 14K
.0103.
(21 with the federal early intervention funds, chil-dren
served shall be from birth through two
years of age and their families.
(3) with state early intervention funds, children
served shall be from birth through two years of
age except that:
(A) services may continue until the start of the
next school year for children who turn three
during the course of the school year, and
(B) three and four year olds may be served during
the summer and during the school year in
before/after school programs.
(4) funds shall be used to supplement and increase
services for these children and may not be used
to supplant other federal, other state or local
funds.
Statutory Authority G.S. 122C-1 12(a)(6); 122C-131;
122C-150; U.S.C. 1471 Part H IDEA.
.1115 FUNDING GROUP HOMES FOR
DEVELOPMENTALLY DISABLED
ADULTS
fft) Pursuant to G.S. 122C 1 4 1, tho Division shall
administer a program of grants to area progromo to bo
ottllod fimdn for group homes for developmentally disabled
ttdulto.
(b) Suob gronta shall be uood to support group homoa for
dovolopmontally disabled adults.
(e)
—
Adults in whose behalf funds are administered to
programs shall be^
ft) 1 8 years of ago and older; and
(3) rosidonta of North Carolina.
(d) To bo eligible for funds for group homos for develop
mentally disabled adults,—the oommunit)' shall provide
rosidonto with a total array of sorvioos and programs to moot
thoir various needs and lovol s of capability and not just
24 hour oaro. These programs shall promote a oomplete life
for these individuals in a oommunit)' setting.
(o) Funds for group homos for dovolopmontally disabled
adults shall bo administorod to area programs as diroot
grants and do not require local matching.
(f)—Programs may spend funds for group homes for
dovolopmontally disabled adults for the following !
(+) renting or loosing facilities ;
(3) furniture or spooialized equipment for residents;
(5) transportation of residents;
(4) other nocosoory operating oxponsos as approved
by tho Division; and
(5) the purchase, oonotruotion or alteration,—im-provement
or repair of a facility by the area
program or a non profit board with division
approval with tho exception of programs partici
pating in federal Department of Housing and
Urban Development (HUD) Section 202 projeots
which shall follow tho requirements spocifiod in
(f)(6) of this Rulo. Tho program shall moot tho
following requirements:
fA)
The Group Home Mortgage Poyment Program.
Tho Division may participate in tho mortgage
payment program contingent upon tho avail
ability of State funds.
(B)—Tbe
—
Group—HeiHe
—
PurohaBe/Construotion
Program.
(i) The Division may partic ipate in tho down
payment or lump sum purchase or oon
struction of a group home in whole or part
contingent upon tho availability of State
funds.
(ii) The area program or non profit board shall
secure two property appraisals for review
and approval by tho Divi sion prior to
purchase.
{i«)
—
If a now construction grant is requested,
th e area program shall submit two oon
struction bid contracts from two building
contractors—to tho appropriate—regional
office for review and approval prior to
oonstruotion bid lotting.
(€)
—
A request for initi al renovation of a newly
acquired—facilit)' of fivo thousand dollars
10:15 NORTH CAROLINA REGISTER November 1, 1995 1446
PROPOSED RULES
($5,000) or loan ohnll bo aubmittod to the
appropriato regional offioo of the DiviDion for
approval.—Initial minor repairs to faoilitioo of
loaa than one thousand dollars ($1,000) shall
bo approved by the area program.
{©)
A request for alteration or improvement of an
existing facility in oxoooo of five thousand
dollars ($5,000) ahall bo fors^'ardod to the
Division Director's office through tho appro
priate regional offioe of th e Division for ap
proval.
(E)
—
Each request as outlined in Parts (0(5)(B), (C)
and (D) of this Rule shall bo aooompaniod by
a narrativ e
—
that explains the neod—for th e
purchase, oonotruotion or alteration, improve
mont or repair of tho facility and a copy of the
schematic—drawings and specifications. tf
approved by the Division of Mental Health,
Developmental—Disabilities—and
—
Subotxmoe
Abuse Services, these drawings and specifica
tions shall be forwarded to tho Division of
Facility Sopi'iooo for rev iew and approval.
(¥) If the group home is operated by a non profit
board, tho area program shall sign a contract
with the private non profit agency for either
the mortgage paymenta to be made or the
purchase or construction program as indicated
in (A) and (B) of (0(5) of this Rul e. A copy
of tho appropriate contract shall be obtained
from the controller's offioe of the central
offioe of the Division.
fG^
If a facility' owned by an area program or its
private non profit contract agency was pur
chased,—altered,—improved,—or rehabilitated
using division funds and later ceases to be used
in tho deliver)' of services to clients, the facil
ity may be sold at tho current fair market
value or retained, and the area program or its
private non profit contract agency shall reim
burse tho Division according to tho following
roquiromonts:
(i) The current fair market value , acceptable
to the Division, ohall bo determined by
two indopondont appraisals submitted and
used as guidance.
(ii) Reimbursement shall be a pro rata share of
the accepted value, based on the oontribu
tion made by the Division in tho purchase,
construction or alteration, improvement or
repair of the facil i ty.
(iij)
—
The area program shall maintain a reoord
which roflocts tho amount of contribution
made by tho State for purchase, construe
tion or alteration, improvement or repair
to the fac i lity;
(6) to participate in a federal Department of Hous
ing and Urban Development (HUD) Section 202
project (12 U.S. C. § 1701q) for tho purohoso,
oonotruotion or alteration, improvement or repair
of a group home with division approval. The
program shall moot tho following roquiromonts'.
(A)
The area program may foquoat funds fof this
project from the Division. The Division may
participate in the HUD Sootion 202 projoot
contingent upon the availability of State funds.
(B)
—
Tho area program shall sign a contract with a
private non profit agency to opeoify that if the
group home oeaooo to bo used in the delivery
of services to tho clients, the facility may bo
sold at tho current fair market value or re
tained, and the private non profit agency shall
reimburse the Division according to the fol
lowing requirements!
(i) Tho current fair market valuo, acceptable
to the Division, shall be determined by
two independent appraisals submitted and
used 08 guidance.
(h) Reimbursement shall bo a pro rata shore of
the accepted value , booed on the oontribu
tion made by tho Division in the purchase,
construction or alteration, improvomont or
repair of the facility.
(€)
The area program shall maintain o record
which refleotfl the amount of contribution mode
by the State for purchase,—construction or
altomtion, improvomont or repair to tho group
(g) Fund Balance.
(1) Tho Division may allow group homos for dovol
opmontally disoblod odults to maintain a fund
balance of no more than 15 percent of tho
current annual budget for the group home.
(2) Tho 15 percent fiind balance aholl be genorotod
entirely by non State funds .
^) The Division may decrease State oppropriation
to group home, thereby necessitating the group
homo to utilize its fund bolonco, if tho State
appropriation is required in order to continue
operations at another home .
f4) The 15 percent fiind balance allowed shall be in
addition to the amount tho Division would oUow
to remain in the fund bolonoo due to restricted
donations.
(5) Except for the restricted donations and the 15
percent fund bolonco, fimds for group homos for
dovelopmontally d i sabled adults shall be ex
pended loot.
(6^ An allowance for a fund balance for group
homofl that ore opwratod by an area program is
made in Rule .1125 of this Section.
(h) To apply for funds for group homes for developmon
tally disabled adulto^ on annual plan and budget for such
funds shall bo included in the appropriate oroa program's
total onnuol plon and budget package when it is submitted to
1447 NORTH CAROLINA REGISTER November 1, 1995 10:15
PROPOSED RULES
tho appropriate regional offioo of tho Divioion.
(i) Fundo for group homoo for developmentally dioablod
adulto shall bo allooatod among tho rogiomi of tho Divioion
by tho Division Diroctor.
(j) Boood on tho approved annual plan and budget roquoot
submitted and availability' of fundo, allooation of fundo for
group homoo for dovolopmontally dioabled adulto to area
progmma within oach region shall bo mado by tho Divioion
Diroctor of his deaignoo.
(Ic) Tho monthly rent for oUonto reoiding in HUD fiiianoed
group homeo io dotormin&d aooording to the oriteria oot forth
in HUD Handbook ISSO.S, "Oocuponoy Roquiromonto of
Subsidized Multi Famil>' Housing Programs" (which may bo
obtained from tho Doportmont of Houoing and Urban
Dovolopmont, 2306 Woot Moadowview Road, Groonoboro,
H-.—G-.—24701) and horoby inoorporatod by roforonoo,
including any subsoquont omondmonts and editions.—Should
tho rent for thooo rooidento oxoood one hundred and fifty
doUaro ($150) per month, a room and board rote higher than
tho ootablisbod maximum rate, in aocordanoo with tho
provisions of 10 NCAC 47A .0201, shall bo ohargod. The
full rent shall be payable to tho project owner of tho home .
RocponoibilitioD and formula for payment of thio amount -afa
as follows!
(i^ The area program or private non profit agency
operating the homo ohoU pay out of ito operating
budgot, the first one hundred and fift)' doUoro
($150) of the HUD determined rent and 20% of
any amount that oxcooda the one hundred and
fifty doUaro ($150).
(2) The remaining 80% of tho amount that exceeds
tho ono hundred and fifty dollars ($150) shall be
paid by tho rooidont or any othor party who
aooumoo rooponoibility.
Statutory Authority G.S. 122C-1 12(a)(6), (11); 122C-141;
122C-147.
.1116 FUISTDS FOR MENTAL RETARDATION
COMPLEXES
(a)
—
Identification. Pursuant to G.S. 122C 112 the
Divioion ohall adminiotor a program of granto to Kendall
Center in Greensboro and Mecklenburg Center for Human
Development in Charlotte to bo called funds for mental
retardation complexes.
(b) Uoe of Fundo.—Such grants ohall be uoed to provide
day care , reoidentiol core, and other services to mentJilly
retarded children and adults.
(©3
The matching requirements of funds for mentid
retardation oomplexes and the typw of expenditures eligible
to be supported by funds for mental retardation oomplexeo
aro tho same as those for area matching funds sot forth in
Rule . 1 103(b) and (c) of this Section.
Statutory Authority G.S. 122C-51; 122C-112; 143B-10.
.1117 GRANT-IN-AID FOR ADULT
DEVELOPMENTAL ACTIVrrY
PROGRAMS
(tt) The Divioion shall administer a program of grants to
area pwogmms to be called tho grant in aid for adult devol
opmontol activity progromsr
(b)
—
Such grant in aid fundo ohall bo uood to oupport
clients who are:
(i) substantially—mentally—retarded—er—severely
phyoioally dioablod persons as doFmed in 10
NCAC HK .0103 except that clients with a
primary diagnosis—of othor than oubotantial
mental retardation of sovoro phyoioal dioabilit)'
may bo eligible fof funding provided!
fA)
they have been in an i\DAP continuously from
tt date prior to January 1, 1975 and ore our
rently receiving j\DAP grant in aid; and
(B)
—
dint all othor ADAP standtirds and regulations
Buoh ao annual re evaluation and referral to the
Divioion of Vocational Rehabilitation Services
shall apply equally to this client population; or
(3) othorv.'i6e substantially dovolopmontally disabled
which means those individuals functioning at
either Level I or Level 11 as defined in "Pioneer
Funding System Qpomtions Manual, Volume HI,
Level of EUgibilit)', Section 4 , Child and Adult
Developmental Disability", adopted pursuant to
G.S. 150B l'l(c);
(3^ 16 years of ago and older;
(4) residents of North Carolina; and
(S) eligible for ADAP grant in aid regordleoo of
financial resouroeo with the exception of a client
whose work earnings exceed one half tho federal
statutory' minimum wage ovof a consecutive
90 day period.—With prior approval of the
appropriate area director or designee , oliento
who are participating in a gupportod employment
program authorized by tho Division may have
earnings in excess of one half the minimam
wage.—Eligibility' for olionto in non supported
employment settings whoso earnings have ox
ceedod over one half tho minimum wage for
ovor 90 oonoooutivo days may be extended for
up to one calendar year if supported employment
options aro not available locally and the client ia
ineUgible for other sor>'ice8 from the Division of
Vocational Rehabilitation,—or if the client's
social, behavioral or vocational skill deficits
preclude participation in supported employment
options and results in ineligibility for othor
vocational rehabilitation Der<'ioeo. The eligibility'
extension shall occur through the existing client
rocortification process carried out by tho dosig
natod area program qualified dci'elopmontal
dioabllitioo profoooionol (QDDP) as roferenood in
10 NCAC 18M .0800. Requests for the exten
sion shall be baaed on a joint case review in
volving a roprosontativo of tho involved j\Di\P,
10:15 NORTH CAROLINA REGISTER November 1, 1995 1448
PROPOSED RULES
tho local VR unit and the aroo program.—The
roquoot ohall identif^' th e opooiFio skill de fioito
prooluding eligibilit>' for supported omploymont
or other vocational rehabilitation DCPt'iooa and
include plana for thooo deficito.—Tho oortiFication
oKtonoion may be reapplied for a maximum of
two timeo.—The same orite ria and prooedureo
shall bo followed in each inatonco of roapplica
tion as arc required for the initial extension.
(o) Grant in aid for adult dovolopmontal activity programs
shall be adminiotcrod to area programo up to a otandard rate
per month, as approved by the General—Assembly or
Division Director, or both, except programs may receive
federal grant in aid funds on a total oost baoio with th e
Division Director' s approval in aooordanoe with Section 26
of tho "Area Program Budgeting and Procedures Manual"
(division publicat i on APSM 75 1) as published June 27,
198'1. which is adopted by reference .—Copies of Section 36
of the "Area Program Budgeting and Procedures Manual"
may bo insf>octed at the Raleigh office of tho Division or
copies may bo obtained from the Publications Office of the
Division at a charge which covers printing and postage.
(d) Funding of now adult developmental aotivit)' programs
shall bo limited to the areas (count)' or community or both)
specified in division publication j\fSR 120 1, "Development
of N ew—Adult—Developmental—Activity—Programs.
"
—as
published July 1, 198 1. which is adopted by reference .
Copies of this publication may bo inspected or obtained as
specified in (c) of this Rule .
(o) To apply for ADj'VP grant in aid funds on onntial plan
and budget for such fundi) shall be included in the appropri
ate area program's total annual plan and budget package
when it is submitted to the appropriate regional office of tho
Division.
(f) Approval of release of ADAP grant in aid funds shall
bo made by the Division Director or his designee.—Theso
adoptions by—reference—afe
—
in accordance—with—G.S.
150B M(c).
Statutory Authority G. S.
122C-141.
122C-1 12(a)(6); 122C-131;
.1118 SPECIALIZED COMMUNITY-RESIDENTIAL
CARE SUBSIDY
(q) Tho Division shall administer a program of grants to
area programs to be called specialized community' resid ential
care.
(b) These funda shall be tised to provide for the purchase
of residential services for moderately, severely, and pro
foundly re tarded cli ents in specialized oommunity residential
programfl.
(c) Sp>ocialized community residential core subsidy shall
be administered to area programs up to a stxindard rate per
month 06 approved by the General Assembly. Division
Director or both.
{4)—Clients in whose boholf funds ore administered to
programs shall bo:
(4^ moderately, sovoroly, or profoundly retarded
including infants at high risk for mental rotarda
tion, for whom a diagnootio label of mental
retardation is inappropriate prior to three years
of ogo, OS cortified by a lioonsod phyoioian, and
for whom a less restrictive program io not
available;
(3) botwoon tho ages of birth and 21; and
{¥) residents of North Carolina, except for clients
receiving residential oare subsidy who are other
wise eligible and whoso residency status ohongoo
to non state residency after admission.—Clients
with such a change in residency status may bo
included for funding for up to one year provided
a plan for transfer of tho oliont to tho now
residency site or for oltomativo funding is estab
lished and pursued and this plan is approved and
reviewed qtmrterly by the Regional Director and
area director or their respective dosigneoo.
CUonts not mooting the provisions of (d)(1) and (2) of this
Rule may receive funding upon special approval of tho
Division Director.
{p)—To apply for sp>ecializod oommunit)' resid ential ooro
subsidy funds, on annual plan and budget for such funds
shall be included in the appropriate area program's total
annml plan and budget package when it is submitted to tho
appropriate regional office of the Division.
ff)
—
Disbursement of specialized community residential
caro subsidy funds shall bo mado aftor approval of tho plan
and budge t by the Regional Director.
Statutory Authority G.S. 122C-1 12(a)(6); 122C-131;
122C-141.
.1119 MENTAL RETARDATION
COMMUNITY SERVICE FUNDS
{er) Pursuant to G.S. 122C 112. the Division shall
administer a program of grants to be call ed mental rotarda
tion community service funds.—These funds shall bo
allocated to tho eastern region in the amount of at least five
hundred thousand dollars ($500,000) and to other regions
based upon th e availability of funds.
(b)
Mental retardation community service funds may bo
used to support mental retardation sorvicos including, but
not limited to, dovolopmontxil day caro for children and
activity programs for adults.
(0) Mental retardation oommunity service funds shall bo
administered to area programs as direct grants requiring no
local matching.
(d^
—
To apply for mental retardation oommunity soni'ioo
funds, an annual plan and budget for such funds shall be
included in the appropriate area program's total annual plan
and budget package when it is submitted to the appropriate
regional office of the Division.
fe)
Mental retardation community sep-'ioe funds may bo
utilized for repairs and maintenance of facilities which
roprosont normal upkeep and do not materially increase tho
1449 NORTH CAROLINA REGISTER November 1, 1995 10:15
PROPOSED RULES
value of tho facilitj' or oxtond its useful life.
(f) Fundo appropriatod for montal rotordntion oommuBky
son'ioe shall bo allooated to aroa progromo of tho gppropri
ato region by tho Diviaion Director or hio designee.
Statutory Authority G.S. 122C-112; 122C-147; 122C-151.
.1120 COMMUNITY DEMONSTRATION
PROJECT FUNDS
(ft^ Purouant to G.S. 122C 112, tho Divioion ohall
adminiotor a program of grants to bo oalled oommuatty-demonstration
project funds.
(fe)
—
Such fiinds shall be used for tho development and
domonotration of now and innovative oommunit)' oorvioes
for mentally retarded poroono.
(e)
Community demonstration projects funds shall bo
adminiotorod to aroa programs as direct grants requiring no
local matohingr
(d) To apply for oommunit>' demonstration proj ect fundo,
an annual plan and budget for such funds shall bo included
in tho appropriate area program's total annual plan and
budget fKiokage whan it io submitted to the regional office of
tho Division.
(e)
Community demonstration project funds shall bo
allocated among the regions of tho Division by the Division
Director or his doaignoe.
ff)
—
Community demonstration project fundo may be
utilized for repairs and maintenance of facilitioe which
roprosent normal upkeep and do not materially incrooso tho
value of the facility or extend its uoeful life.
(g)
—
Based on the annual plan and budget submitted and
availabilit>' of fundo, allocation of community domonotration
project funds to area programs shall bo made by tho Divi
sion Director or hio deoignee.
Statutory Authority G.S. 122C-112; 122C-147; 122C-150;
143B-10.
.1121 SOCIAL SERVICE (TITLE XX)
BLOCK GRANT FUNDS
(a)
Tho Divioion shall administer a program of sorviooa
and training from fundo provided by the United States
Department of Health and Human Servioeo under the
authority' of Title XX of tfto Social Socurity Act, 42 U.S.C.
1397 13 97f.
(fe)
Service fundo ohall be used to provide allowable
oervioeo to moot opeoifio noodo of individuals who are
emotionally disturbed,—mentally retarded,—or substance
abusers and who have been certifiod eligible by tho appro
priate area program.—Training funds ohall be uoed to
provide training aotiviti eo related to th e provioion of Titl e
XX fundable ser>'icoo.
(e)
Programs shall bo operated by the Divioion, an aroa
program or through contractual arrangement with an area
program.
fd)
Allocation of fundo to area programs shall bo on an
annual basis and shall bo based on the needs of eligible
clients as documented in tho aroa program' s approved
annual plan of work and budget requeot.
(e)
Divioion staff shall provide administrative support
necessary for progmm development and technical asoistaneo
to insure compliance—with federal—and state laws and
regulations .
(f)
—
Reimburoement shall be made in aooordanoo with
Sections 5 and 26 of tho "Area Program Budgeting and
Procedures Manual" (division publication APSM 75 1),
adopted pursuant to G.S. 150B 11(0).
(g) Aroa progromc oball oond roimburoemont formii to the
controller' s office of the Division by tho 10th day of tho
month following sop.'ico.
Statutory Authority G.S. 122C-147; 122C-150; 42 U.S.C.
Section 1397-1397/.
.1123 AREA MENTAL HEALTH CENTER
CONSTRUCTION PROJECT
(e)
The Division ohall administer a program of direct
grants from state funds to area programs for tho construe
tion of oomprehenoive area programo or components of ouch
programs which ohall be known ac oomprehenoive area
programs construction project grants.—Before such grants
can be awarded a certificate of need shall be obtained by tho
grantee,
(b) Such grants may be used for the following:
(4^ Architect's fees for the preparation of drawings
and sp>ocifioation8 for tho project;
(2) Fee s for preparation of contour maps and ooil
inveotigation;
(3) Coots of advertioement for construction bids;
f4) Construction contracts including general, plumb
ing, eleotrioal, elevator, air conditioning and
ventilating and any oub contract or ooporate
contract relative to tho construction;
(5) Items of movable equipment when approved by
the Divioion;
(6) Cooto of advertisement for bido for movable
equipment;
(^?) Tho coot of ohongo orders relating to conotruc
tion or equipment when such change orders are
approved by the Divioion of Faoilit)' SePi'ioeo of
tho Department of Human Resources and tho
Division of Mentxil Health, Montal Retardation
and Subotanoe Abuse Services.
(8) The cost of landooaping including related arohi
tocturol service, seeding, sprigging or sodding of
the site and the planting of trees and shrubs as
would be normally considered a part of tho
gene ral construction contract. Tho cost of
landscaping recreational areas such as courts and
outdoor patient areas for therapeutic effects of
the environment in the mental health center may
be paid from division fundo upon prior approval
from tho Division of Montal Health, Montal
Retardation and Substance Abuse Sor>'ioo3 and
10:15 NORTH CAROLINA REGISTER November 1, 1995 1450
PROPOSED RULES
the Divioion of Facility Sorvicoo.—In ordor to
obtain approval,—th o grantee must Bubmit a
writton proposal fully justil^'ing the full)' juotif)'
i ng tho thorapoutio effort of tho landscaping.
(e)
Such grants flhall not bo uood for tho following;
fj^ purohaoe of site ;
f2) attornoy—fooo for title ooaroh,—preparation of
doodfl and other such closing costs;
{¥) surveyor's foo for survey of lot for purposes of
deed preparation;
{4) oonotruotion or equipment not approved by the
Division;
(5-) landscaping in excess of that included in tho
general contract or that which is inconsistent
with otipulationc regarding landaoaping contained
within this Rule; and
(6^ stationer^', printing, secretarial services, pwstago,
trave l , and othe r incid entals in conneotion with
the proj ect.
fd^
—
Application for such finds shall bo upon a standard
form which shall require the following information:
f4^ name of applicant;
(3) addreoD of applicant;
(3) the name and typo of the proposed facility and
its proposed address;
(4) the type of construction whether new, on expan
sion of existing facility, remodeling or other;
{&j tho type of ownership of the project, whether
public or private non profit;
(6^ the type of operational control of the project.
whethe r public or private non profit;
f?3 the name, address and telephone number of tho
applicant's representative;
f8) the name , address, and telephone number of the
project architect;
^ a statement of the need for tho facility;
(4#) data on the occupancy of the proposed facility;
(44^ description of programs to be conducted in the
facil i ty;
<4-3^ information on tho financial resources available
to the facility;
fl-59 th e total development cost;
f44) information on whether title to the site will be
vested in tho applicant, tho agency to operate the
facility, or othorvi'isc;
4+5) whe the r the applicant has titl e in fee simple or a
leasehold, or otherwise , and if the applicant has
only a leasehold, information on tho nature of
the lease ;
(4^) a copy of the abstract of title prepared by on
attorney;
f4?) a copy of the site sur^'oy, soil investigat ion
reports and land appraisals, whore applicable;
fl-8) whe re applicabl e , a cert i fication from an archi
teot of th e feasibility—of improving existing
structures;
{W) a copy of the plot plan;
(30) target dates for completion of Bohomatio, prelim
inar>'. and final drawings; and
(34) an estimated construction budget.
fe)
—
Such standard form application shall also require
assurances of tho following:
(+) that the applicant posseoooo l egal authority' to
apply for and receive tho grant or loan, and to
finance and construct the proposed facility; that
Q rosolution, motion or similar action has boon
duly adopted or passed oo an official act of tho
applicant's governing board, authorialng tho
filing of tho application, including all under
standing and assuroncoa contained therein, and
directing and authorizing the person identified as
the official representativ e of the applicant to act
in connection with tho application and to provide
such additional information as may bo required;
(3) that sufficient fiindo will be available to moot tho
non state share of the costs of constructing the
facility, and that sufficient funds will be avail
able when construction is completed to assure
e ffective—operat i on—and
—
maintonanoo—of tho
faoilit)' for the purposes for which constructed;
(5) that approval by the Div i sion of the final work
ing drawings and Bpocifioat iona will be obtmned
be fore the project is advertised or othorv^'iso
placed on the market for bidding; that it will
construct tho project, or oauoo it to bo con
structod, to final completion in accordance with
the application—and approved—drawings and
speoifioationo; that it will submit to the Soorotar)'
of Human Resources or his designee for prior
approval changes that materially alter tho scope
or costs of tho proj ect, use of space or funo
tionol layout; that it will not enter into a oon
struction contract or contracts for the project or
a part thereof until tho conditions of the con
struction grant or local program have boon mot;
{A) that except as otherwise provided by state or
local law. all contracting for construction (in
eluding the purchase and installation of built in
equipment) shall be on a lump sum fixed price
basis, and oontraota will be awarded on the baois
of competitive bidding with award of tho con
tract to tho lowest responsive and responsible
bidder—(The provision for exceptions baaed on
state and local law will not bo invoked to give
local—contractors—et—suppliers—a
—
pwrcentago
preference over rKxi local oontrootors bidding for
the same contract.—Such praotioeo are precluded
by this assurance.);
(5) that it will provide and maintain competent and
adequate architectural engineering aupori'ision
and inspection at the construction site to insure
that the completed work conforms with tho
approved drawings and 3p)ocifications; that it will
furnish progress reports and such other informa
1451 NORTH CAROLINA REGISTER November 1, 1995 10:15
PROPOSED RULES
)
tiop 00 tho Socrotary of Human Roeourcoo or hio
dooignoo may roquire ;
(6) that an oBoumnoo of oomplionoe with Title VI of
tho Civil Righte Aot of 1964 applying to the
facilit)' doacribod in this application was filed or
is attaohod to tho applioation;
^ that it will maintain grant or loan aooounting
rocordo (idontifiablo by grant or loon number),
including all records relating to tho receipt and
oxpondituro of otate grant or loan fundo and to
tho expenditure of the non state shore of the ooot
of project for throo years after the completion
of tho project if an audit io conducted by or on
behalf of th e Department of Human Rooouroeo
within thot period, or in the cose where no oudit
is performed for five yoars; oxoopt that should
audit questiona arise with rospoct to tho grant or
loon, the
—
rooordo will be mointained until all
ouoh quootiono ore rooolvod (Roprooontativea of
tho stoto govommont aholl hove occoos to oil
roasonablo times to tho grantee's records ond to
work whonovor it io in preparation or progrooo,
and tho oontrootor shall provide proper fooilitieo
for such occoss and inspKxi tion.);
{%) that the facility' will bo operated and maintained
in aooordonoe with the roquiromento of opplioa
bio otate and local agenoioo for tho maintenonoe
and operation of such facilitioo!
(9) that tho applicant will roquire tho facility to bo
dooignod to comply with the "lUuotrated Hand
book to th e Handicapped Section" adopted by
tho North Carolina Doportmont of Insurance in
1974 and available from tho Engineering and
Building Codes Divioion of the Department of
Insurance , P.O. Box 263 87, Raloigh, North
Carolina 27611 at o nominal cost.—(The oppli
cant shall be responsible for conducting inspoc
tions to insure oompl ionoe with these speoifioa
t iono by the oontrootor.);
(4^ that the applicant will cause work on the project
to bo oommoncod within a roasonablo time after
rec eipt of notification from the Deportment of
Human Reoouroee that fundo have boon ov^'ordod,
ond thot tho projoct will bo prosecuted to com
plotion with roaoonoblo diligonoo; and
^44) that any state funds received pursuant to a grant
or loon will be used solely for defroying the
dovolopmont cost of the proposed projoct.
ff^
—
Such standard form application shall also require
asouronoes of the following:
fi^ That the building will conform to all applicable
roquiromonts of tho appropriate state plan and
tho regulations pertaining thoroto;
(3) That all portions and oeni'ioes of the entire
facility for the construction of which, or in
connection with which, aid is sought, will bo
mode available without discrimination on oc
count of oieod, and no professionally qualified
person will be diooriminoted against on oooount
of orood with respect to the privil ege of profeo
sionol practice in tho facility;
(J) That tho fooilit)' will furnish on area sors'ico ond
either will fiimish below ooot or without ohorgo
a reasonable volume of sori'iooo—to persons
unable to pay for such oor^'ioos, or will supply
on attached juotifiootion for not furnishing below
cost or without charge a roasonablo volume of
services to persons unable to pay therefor;
(4) The facility will bo usod for tho purposes for
\»'hioh it is oonotmotod for not logs than 20 years
after the completion of the construction; ond
(5) That the cervices to be provided by the fooility,
alone or in conjunction with othof facilitioo
owned or oporotod by tho applicant, will bo
made ovoiloblo for o progrom providing prinoi
pally for persons residing in a particular area or
aroos in or noor which such focility is to bo
situated, ot least tho ossonti ol olomonts of com
prehenoive montal health oorviooo—ii e ., oontinu
ous sepi'iceo, periodic servioes, doy/night ser
vices (including at least day core son.'ices),
emergency sori'icos provided 24 hours per day,
ond consultation and education services ovoiloble
to area ogonoieo and profeosionol personnel,
(g) After award of o grant fiscol records shall bo consoli
dated and mointained by the treasurer of the projoct in o
central location accessible to auditors and inspectors of the
Department of Human Rooourooo.
(h)
—
Aftor oword of a gront tho nomo and address of tho
treoflurer of tho projoct shall bo oubmittod to tho Division as
soon as o treoourer is appointed.
(i) After award of a gront records shoU bo dosignod and
mointflinod to reflect the purpose for which each oxpondituro
is mode.
^—After award of a grant records of the opplicont oholl
reflect oil transactions between the sponsor and contractors
and vondora and botwoon tho sponsor and tho Divioion.
(k) After oward of o grant on aooounting system shall bo
organized so oo to fooilitote auditing and preparation of
reports.
(i)
—
Aftor aword of a grant tho sponsor shall maintain a
record of deposits and disburoomonto on o standard form
supplied by tho Divioion.
(m) After award of o grant o special bank account shall
be established and maintained for tho uso of tho projoct
exclusively into which the local share of costs shoU bo
deposited.—State and federal funds, if any, shall also be
deposited into tho account as they ore received.—Checks for
all items of projoct costs shall bo drown on this account and
a copy of the cancolod chocks and tho invoices for which tho
checks were drown shall be filed in ohronologioal order.
(n) After award of o grant, payment inopootiono shall bo
mado by tho Division of facility services of tho Dcpartmont
of Human Resources when approximately 10 pvorcent, 25
10:15 NORTH CAROLINA REGISTER November 1, 1995 1452
PROPOSED RULES
poroont. 50 f>orcont. 75 porcont and Q5 f>orcont of tho
oonotruotion and oquipmont aoquioition and inotallation io
compl e t e . Grant fundo ohall be dioburood after ouoh
inajxictiona lajoh that tho total amount of funds disbursed to
tho project will bo that poroontago of tho total amount of
fundo granted to tho project oqtal to tho peroentage of
oonotruotion whioh io aotually finished.—Final payment shall
bo made aftor all oonatruction is comploto and all equipment
is dohvorod and on aud i t of tho projoct records is complotod.
(e^
—
Aftor award of a grant tho proj ect treasurer shall
maintain rooordo whioh will rofloot the amount of North
Carolina sales and use tax paid by each contractor and
sub contractor. Such tax information shall bo required to bo
supplied by th e oontraotor with each payment request.
(a) When capital funds are specifically appropriated by
the General Assembly, the Division shall allocate funds for
area program capital projects. Such allocations shall be in
accordance with the language and intent of the appropria-tion.
Instructions for capital applications and payment of
funds shall be issued by the division subsequent to any such
specific appropriation.
(h) An area program may request to use state non-UCR
funds, Willie M. or Thomas S^ funds, or to transfer state
operating funds outside the regular. Willie M. and Thomas
S^ unit cost reimbursement systems for capital costs for
itself or its non-profit contract agency, in accordance with
G.S. 122C-147. In accordance with G.S. 122C-147. such
requests are limited to 24-hour and day facilities, except that
Willie M. funds may also be used for other necessary
facilities. The following procedures shall be followed:
(1) Approval for purchase, lump sum down payment
or periodic payments on a real property mort-gage
in the name of a private, non-profit corpo-ration,
alteration, improvement or rehabilitation
of real estate costing under five thousand dollars
($5.000) is delegated to the area director.
(2) Approval for purchase, lump sum down payment
or periodic payments on a real property mort-gage
in die name of a private, non-profit corpo-ration
alteration, improvement or rehabilitation
of real estate costing five thousand dollars
($5,000) or over shall be based upon submission
of an application by the area program to the
Division Director or designee. Such application
shall be in i format prescribed by the Division
and may include the following:
(A) name of applicant;
(B) address of applicant;
(C) the name and type of proposed or existing
facility and its location;
(D) the purpose of request, whether new construc-tion,
purchase of an existing structure, alter-ation,
improvement or rehabilitation of an
existing facility;
(E) a statement of the need for the facility or
alteration, improvement or rehabilitation;
(F) description of the programs conducted or to be
conducted in the facility;
(G) target date for project completion;
£H} an estimated construction budget and projected
revenue sources;
(I) a statement indicating whether or not addi-tional
Division funds will be required for
operating costs. If this question is answered
yes, the application shall indicate the estimated
additional operating funds required and the
proposed funding source; and
(J) the name and telephone number of the area
program representative designated as contact
for the application; and
(K) two property appraisals completed by licensed
property appraisers for costs associated with
the purchase of an existing building, lump sum
down payments and period payments on the
mortgage of real property.
(3) Funds approved for capital projects under Para-graph
£b} of this Rule shall be paid in the fol-lowing
manner:
(A) Funds approved under Subparagraph (bMV) of
this Rule shall be requested by the area pro-gram
using regular fund request procedures as
funds are needed.
(B) Funds approved under Subparagraph (bM2) of
this Rule shall be requested in the following
manner:
(i) if funds are to be utilized for the purchase
of a facility, the necessary funds may be
requested within 30 days from when they
are needed via a written request from the
Area Director to the Division Director or
designee. The request shall specify the
amount of funds needed and the projected
closing date of the purchase,
(ii) if funds are to be utilized for the construc-tion
of a new facility or renovation, reha-bilitation
or alteration of an existing facil-ity,
funds will be disbursed based upon
written requests from the Area Director to
the Division Director or designee certify-ing
project completion at the following
intervals: 10%. 25%. 50%. 75% and
100%. Upon receipt of such billings, the
Division shall issue payment consistent
with the percentage completed.
(4) All aspects of any capital project shall be com-pleted
in accordance with all applicable federal.
State and local regulations. Such compliance
shall include, but not be limited to, G.S. 159
requirements. Division of Facility Services
licensure regulations, local building ordinances,
etc.
(5) The area program shall maintain a perpetual
inventory of all facilities purchased, constructed,
altered, renovated or rehabilitation in accordance
1453 NORTH CAROLINA REGISTER November 1, 1995 10:15
PROPOSED RULES
m-
)
Current Asoeto Por Audit Report
Loas!—Liabilitios Por Audit Rop>ort
Fund Balanco
Leoo: Reoers'e for Enoumbranoeo
with this Rule. This inventory shall document
the history cost of the facility plus subsequent
improyements and the percentage of Diyjsion
participation in the total cost.
(6) Should the facility cease to be used for the
purpose of serving clients of the Djyision. or,
more specifically for the purpose of serving
Willie M. or Thomas S^ clients if the purchase,
construction, rehabilitation, alteration or im-provement
was funded from those specific
funding sources, the Division shall be contacted
immediately for disposition instructions. If the
Division so directs, the facility shall be sold at
the current fair market value in accordance with
G.S. 153A-176 and G.S. 160A-266. After the
sale, the Division shall be reimbursed the Rosorvo for Inventory
Division's pro-rata share of the proceeds from
the sale based on the percent of contribution
made by the Division for die purchase, construc-tion,
alteration, improvement or rehabilitation of
the sold facility. If an area program or its
contract provider wishes to maintain ownership
of a facility that was constructed, purchased,
altered, improved or rehabilitated using Division
funds, the area program or non-profit contract
provider may, if authorized b^ the Division, pay
to the Division the Division's pro-rata share of
the current fair market value of the facility as
determined by two independent appraisals ac-ceptable
to the Division.
rondorod.
To dotormino the unrootriotod fund balonoe and
the percent that it roproeonto to the operating
budget, the Divioion oholl uoo the following
formnt!
-f-
Reserve for Patiento Aooounto Receivable
LoflS! Allowonco for Doubtful Accounts Patient
Accounts Receivable ( )(
-
Reoor^'e for Aooounto Receivable from
Govommontal Entitieo (-
Rofloni'o for BUT Foes
Reoers'e for Drug Education School Fooo -e-
Reoer^' e for Reotrioted Donations (—
Fund Balance Restriction Proviouoly Approved by
DMH/MR/SAS (Prior to February 1, 1986.) (-
Other(Li6t) -e
Unrestricted Fund Balance
Annual approved budget pluo approved budget
revisions as of September 30
Percent Unrestricted Fund Balance to Current
i\nnual Budget percent
Statutory Authority G.S. 122C-112; 122C-113.
.1125 FUND BALANCE: AREA PROGRAMS/
CONTRACT PROGRAMS
(a) In order for the Division to have input into the actions
regarding fund balances in area programs and contract
prognuno ao provided for in Rule . 101 1 of thio Subchapter,
the following shall take place after the certifi ed public
accountant's audit report is rendered and the tentative
settlement report prepared;
(4^ The fund balance set forth within the annual
audit of area programo and contract programs
shall bo verified by the Divioion.
(3) Since single county area progroma are consid
ered a department of the county for budgetary
and financial reporting, separate fund balanoeo
for the single county area programs are not
required.—In order to assure that single county
area programo are in compliance with G.S.
122C 146 which states that fees received for
services shall not reduce or replace the budgeted
commitment of local tax revenue, the Division
shall review the utilization of county general
funds and the disposition of foes received for
aor^'ioo each year.—This review shall occur after
the annual audit report for the county has been
^4r) If the unrestricted fund balance is not in excess
of 15 percent of the current onnuiil budget, no
action io to take place.
(5) If the unrestricted fund balance is over 15
percent of the current annual budget, the Divi
oion oholl reduce ito allocation of divioion funds
in the year ouboequent to the year in which the
excess occurred,
(b) The amount of reduction of financial support by the
divioion to area programs and contract programa ao refer
enced in (a) (5) of this Rule may bo decreased and/or
delayed if thoro are extenuating circumstanoos which, in the
opinion of the Division Director, warrant relaxation of this
policy. Any action token in regard to (b) of thio Rule shall
be documented in writing.
Statutory Authority G.S. 122C-1 12(a)(6);
122C-146; 122C-147; 143B-10; 159-8.
122C-144;
. 1 126 FUNDING GROUP HOMES FOR
MENTALLY RETARDED CHILDREN
(«) Pursuant to G.S.—122C 117, the Division shall
adminioter a program of grants to area programs to be
called funds for group bomoo for mentally retarded children.
(b) Such gra