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Z_j Kl^rJ / 74-34-/- Az/^lbT-The NORTH CAROLINA REGISTER IN THIS ISSUE COWa TITUl itiomI EXECUTIVE ORDERS IN ADDITION Tax Review Board PROPOSED RULES Architecture, Board of Cultural Resources Environment, Health, and Natural Resources Human Resources Secretary of State LIST OF RULES CODDTED RRC OBJECTIONS CONTESTED CASE DECISIONS RECEIVES FEB 16 1995 KATHRINl R EVERETT LAW LIBRARY ISSUE DATE: February 15, 1995 Volume 9 • Issue 22 • Pages 1883 - 1962 INFORMATION ABOUT THE NORTH CAROLINA REGISTER AND ADMINISTRATIVE CODF. NORTH CAROLINA REGISTER The North Carolina Register is published twice a month and contains information relating to agency, executive, legislative and judicial actions required by or affecting Chapter 150B of the General Statutes. All proposed administrative rules and notices of public hearings filed under G.S. 1 50B-2 1 .2 must be published in the Register. The Register will typically comprise approximately fifty pages per issue of legal text. State law requires that a copy of each issue be provided free of charge to each county in the state and to various state officials and institutions. The North Carolina Register is available by yearly subscription at a cost of one hundred and five dollars ($105.00) for 24 issues. Individual issues may be purchased for eight dollars ($8.00). Requests for subscription to the North Carolina Register should be directed to the Office ofAdministrative Hearings, P. O. Drawer 27447, Raleigh, N.C. 27611-7447. ADOPTION, AMENDMENT, AND REPEAL OF RULES The following is a generalized statement of the procedures to be followed for an agency to adopt, amend, or repeal a rule. For the specific statutory authority, please consult Article 2A ofChapter 1 50B of the General Statutes. Any agency intending to adopt, amend, or repeal a rule must first publish notice of the proposed action in the North Carolina Register. The notice must include the time and place of the public hearing (or instructions on how a member of the public may request a hearing); a statement of procedure for public comments; the text of the proposed rule or the statement of subject matter; the reason for the proposed action; a reference to the statutory authority for the action and the proposed effective date. Unless a specific statute provides otherwise, at least 15 days must elapse following publication of the notice in the North Carolina Registerbefote the agency may conduct the public hearing and at least 30 days must elapse before the agency can take action on the proposed rule. An agency may not adopt a rule that differs substantially from the proposed form published as part of the public notice, until the adopted version has been published in the North Carolina Register for an additional 30 day comment period. When final action is taken, the promulgating agency must file the rule with the Rules Review Commission (RRC). After approval by RRC, the adopted rule is filed with the Office of Administrative Hearings (OAH). A rule or amended rule generally becomes effective 5 business days after the rule is filed with the Office of Administrative Hearings for publication in the North Carolina Administrative Code (NCAC). Proposed action on rules may be withdrawn by the promulgating agency at any time before final action is taken by the agency or before filing with OAH for publication in the NCAC. TEMPORARY RULES Under certain emergency conditions, agencies may issue ten rary rules. Within 24 hours of submission to OAH, the Codifn Rules must review the agency's written statement of findings of for the temporary rule pursuant to the provisions in G.S. 150B-21 the Codifier determines that the findings meet the criteria in 150B-21.1, the rule is entered into the NCAC. If the Cod determines that the findings do not meet the criteria, the rule is retu to the agency. The agency may supplement its findings and resul the temporary rule for an additional review or the agency may resp that it will remain with its initial position. The Codifier, thereafter, enter the rule into the NCAC. A temporary rule becomes effe< either when the Codifier of Rules enters the rule in the Code or or sixth business day after the agency resubmits the rule without cha The temporary rule is in effect for the period specified in the rule or days, whichever is less. An agency adopting a temporary rule n begin rule-making procedures on the permanent rule at the same t the temporary rule is filed with the Codifier. NORTH CAROLINA ADMINISTRATIVE CODE The North Carolina Administrative Code (NCAC) is a compila and index of the administrative rules of 25 state agencies arid occupational licensing boards. The NCAC comprises approxima 15,000 letter size, single spaced pages of material of which appr< mately 35% is changed annually. Compilation and publication of NCAC is mandated by G.S. 150B-21.18. The Code is divided into Titles and Chapters. Each state agenc assigned a separate title which is further broken down by chapt Title 21 is designated for occupational licensing boards. The NCAC is available in two formats. (1) Single pages may be obtained at a minimum cost of I dollars and 50 cents ($2.50) for 10 pages or less, plus fift cents ($0.15) per each additional page. (2) The full publication consists of 53 volumes, totaling excess of 15,000 pages. It is supplemented monthly « replacement pages. A one year subscription to the publication including supplements can be purchased seven hundred and fifty dollars ($750.00). Individual v umes may also be purchased with supplement service. 1 newal subscriptions for supplements to the initial publicat are available. Requests for pages of rules or volumes of the NCAC should directed to the Office of Administrative Hearings. CITATION TO THE NORTH CAROLINA REGISTER The North Carolina Register is cited by volume, issue, p< number and date. 1:1 NCR 101-201, April 1, 1986 refers to Volu 1 , Issue 1 , pages 101 through 201 ofthe North Carolina Registerissv on April 1, 1986. FOR INFORMATION CONTACT: Office of Administra-tive Hearings, ATTN: Rules Division, P.O. Drawer 27447, Raleigh, North Carolina 2761 1-7447, (919) 733-2678. NORTH CAROLINA REGISTER Office of Administrative Hearings P. O. Drawer 27447 Raleigh, North Carolina 27611-7447 (919) 733-2678 ISSUE CONTENTS I. EXECUTIVE ORDERS Executive Orders 69-71 1883 II. IN ADDITION Tax Review Board 1885 ID. PROPOSED RULES Cultural Resources State Library, Division of 1889 Environment, Health, and Natural Resources Environmental Management .... 1899 Wildlife Resources 1900 Human Resources Aging, Division of 1890 Medical Assistance 1891 Licensing Board Architecture, Board of 1905 Secretary of State Securities Division 1904 Julian Mann III, Director James R. Scarcella Sr., Deputy Director Molly Masich, Director ofAPA Services Staff: Ruby Creech, Publications Coordinator Teresa Kilpatrick, Editorial Assistant Jean Shirley, Editorial Assistant This publication is printed on permanent, acid-free paper in compliance with G.S. 125-11.13. IV. LIST OF RULES CODIFIED 1917 V. RRC OBJECTIONS 1923 VI. CONTESTED CASE DECISIONS Index to ALJ Decisions 1927 Text of Selected Decisions 94 DOA 0516 1943 94 OSP 0655 1949 VII. CUMULATrVE INDEX 1959 NORTH CAROLINA REGISTER Publication Schedule (November 1994 - September 1995) Volume and Issue Number Issue Date Last Day for Filing Last Day for Elec-tronic Filing Earliest Date for Pubbc Hearing 15 days from notice * End of Required Comment Period 30 days from notice Last Day to Submit toRRC ** Earliest Effective Date 9:15 11/01/94 10/11/94 10/18/94 11/16/94 12/01/94 12/20/94 02/01/95 9:16 11/15/94 10/24/94 10/31/94 11/30/94 12/15/94 12/20/94 02/01/95 9:17 12/01/94 11/07/94 11/15/94 12/16/94 01/03/95 01/20/95 03/01/95 9:18 12/15/94 11/22/94 12/01/94 12/30/94 01/17/95 01/20/95 03/01/95 9:19 01/03/95 12/08/94 12/15/94 01/18/95 02/02/95 02/20/95 04/01/95 9:20 01/17/95 12/21/94 12/30/94 02/01/95 02/16/95 02/20/95 04/01/95 9:21 02/01/95 01/10/95 01/18/95 02/16/95 03/03/95 03/20/95 05/01/95 9:22 02/15/95 01/25/95 02/01/95 03/02/95 03/17/95 03/20/95 05/01/95 9:23 03/01/95 02/08/95 02/15/95 03/16/95 03/31/95 04/20/95 06/01/95 9:24 03/15/95 02/22/95 03/01/95 03/30/95 04/17/95 04/20/95 06/01/95 10:1 04/03/95 03/13/95 03/20/95 04/18/95 05/03/95 05/22/95 07/01/95 10:2 04/17/95 03/24/95 03/31/95 05/02/95 05/17/95 05/22/95 07/01/95 10:3 05/01/95 04/07/95 04/17/95 05/16/95 05/31/95 06/20/95 08/01/95 10:4 05/15/95 04/24/95 05/01/95 05/30/95 06/14/95 06/20/95 08/01/95 10:5 06/01/95 05/10/95 05/17/95 06/16/95 07/03/95 07/20/95 09/01/95 10:6 06/15/95 05/24/95 06/01/95 06/30/95 07/17/95 07/20/95 09/01/95 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 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. 15OB-21.2(f) for adoption procedures. ** The "Earliest Effective Date " is computed assuming that the agency follows the publication schedule above, 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 10/94 EXECUTIVE ORDERS EXECUTIVE ORDER NO. 69 GOVERNOR'S COUNCIL ON CHILDREN, YOUTH, AND FAMHJES WHEREAS, the State of North Carolina should promote and encourage collaboration and collabo-rative planning and delivery of services among State agencies that serve the needs of children and families; WHEREAS, the State of North Carolina should make more effective use of existing federal and state resources and programs; WHEREAS, the State of North Carolina should streamline government, including the delivery of services and eliminate duplication; and WHEREAS, the State of North Carolina should promote and enhance state-level leadership in achieving these goals; NOW, THEREFORE, by the power vested in me as Governor by the Constitution and laws of the State of North Carolina, IT IS ORDERED: Section 1. Establishment. The Governor's Council on Children, Youth, and Families is hereby established. Section 2. Duties. (a) The Governor's Council on Children, Youth, and Families shall: (i) Provide state-level leadership on issues affecting children, youth, and families, including children with special needs; (ii) Foster collaboration and coordination between and among the many state agencies with responsibility for provid-ing services to children, youth, and families; (iii) Help develop and carry out a unified and comprehensive long-range children's and families' agenda; and (iv) Promote accountability for achieving the State's goals in a timely and effective manner. (b) The Council shall meet biannually and report to the Governor on its progress in meeting the intent and purpose set forth in this Executive Order. The Governor may convene the Council at other times during the year as necessary to achieve these goals. (c) The Governor shall chair the Council. The Governor shall appoint a Vice-Chair of the Coun-cil, who shall chair the Council in his absence. (d) The Governor shall set the agenda for the Council's meetings and shall take into consider-ation its reports in setting policy for children, youth, and families. (e) The Council may establish such committees, task forces, or other working groups as are neces-sary to assist in performing its duties. The Coun-cil may invite non-members to serve on such groups. (f) Existing executive commissions, councils, and advisory committees with responsibility for issues affecting children, youth, and families shall advise and assist the Council in performing its duties and responsibilities. Section 3. Membership. (a) The Council shall consist of the following members or their designees: (i) The Governor's Senior Education Advi-sor; (ii) The Secretary of Environment, Health, and Natural Resources; (iii) The Secretary of Human Resources; (iv) The Secretary of Cultural Resources; (v) The Secretary of Commerce; (vi) The Secretary of Transportation; and (vii) The Secretary of Administration. (b) The following individuals shall be invited to serve as members of the Council and may appoint a designee: (i) The Lieutenant Governor; (ii) The Superintendent of Public Instruc-tion; (iii) The Chair of the State Board of Educa-tion; (iv) The Commissioner of Labor; (v) The President of the North Carolina Community College System; (vi) The President of the University of North Carolina; (vii) The Director of the Administrative Office of the Courts; (viii) The Chair of the North Carolina Part-nership for Children, Inc.; (ix) The Chairs of the House of Representa-tives and Senate appropriations subcom-mittees for human resources (one from each body); and (x) The Chairs of the House of Representa-tives and Senate substantive committees with responsibility for human services 9:22 NORTH CAROLINA REGISTER February 15, 1995 1883 EXECUTIVE ORDERS programs affecting children, youth and families (one from each body). Section 4. Staff Assistance. The Department of Human Resources shall provide clerical support and other services re-quired by the Council. This order shall be effective immediately. Done in the City of Raleigh this the 24th day of January, 1995. EXECUTIVE ORDER NO. 70 REISSUING EXECUTIVE ORDER NO. 37, CITIZEN ACCESS TO PUBLIC RECORDS MAINTAINED BY STATE GOVERNMENT WHEREAS, Executive Order No. 37, signed January 28, 1994, expired October 28, 1994; and WHEREAS, Executive Order No. 37 implement-ed a trial period for the Departments of Adminis-tration and Transportation to develop an electronic register of public information; and WHEREAS, the Information Resources Manage-ment Commission has reviewed the implementation of Executive Order No. 37 and has recommended that the trial period be extended. NOW, THEREFORE, by the power vested in me as Governor by the Constitution and laws of the State of North Carolina, IT IS ORDERED: Executive Order No. 37, Citizen Access to Public Records Maintained by State Government, is hereby reissued, without changes, until July 1, 1995. The IRMC is requested to make further recommendations prior to the expiration of this Order. This Order shall be effective immediately. Done in the City of Raleigh this the 25th day of January, 1995. EXECUTIVE ORDER NO. 71 EXTENDING EXECUTIVE ORDERS 2, 6, 9, 10, 11, 15, 16, 17 AND 19 By the power vested in me as Governor by the Constitution and laws of the State of North Caroli-na, IT IS ORDERED: The following Executive Orders are hereby extended: A. Executive Order No. 2, Small Business Council; B. Executive Order No. 6, Entrepreneurial Development Board; C. Executive Order No. 9, Commission foi a Competitive North Carolina; D. Executive Order No. 10, Quality Leader ship Awards Council; E. Executive Order No. 11, Governor's Council of Fiscal Advisors; F. Executive Order No. 15, Coordinating Committee on the Americans with Dis-abilities Act; G. Executive Order No. 16, The Geographic Information Coordinating Council; H. Executive Order No. 17, North Carolina Emergency Response Commission; and I. Executive Order No. 19, Center for the Prevention of School Violence. This Order shall be effective immediately and shall expire two years from this day. Done in the City of Raleigh this the 26th day of January, 1995 1884 NORTH CAROLINA REGISTER February 15, 1995 9:22 IN ADDITION STATE OF NORTH CAROLINA COUNTY OF WAKE [N THE MATTER OF: rhe Proposed Assessment of corporate income tax for the taxable years of 1988, 1989, 1990 assessed against BellSouth Telecommunications, Inc. (formerly Southern Bell Telephone and Telegraph Company). BEFORE THE TAX REVIEW BOARD ADMINISTRATIVE DECISION NUMBER: 287 THIS MATTER was heard before the Tax Review Board on 9 November 1994 in the City of Raleigh, Wake County, North Carolina. It involves an appeal by BellSouth Telecommunications, Inc. (formerly Southern Bell Telephone and Telegraph Company), (hereinafter "Taxpayer") from the Final Decision of Michael A. Hannah, Assistant Secretary for Legal and Administrative Services (hereinafter "Assistant Secretary") entered on 20 April 1994, sustaining a proposed assessment of corporate income tax for the taxable years of 1988, 1989 and 1990. Chairman Harlan E. Boyles presided over the hearing with acting member, the Honorable Hugh Wells, Chairman, Utilities Commission and duly appointed member, Jeff D. Batts, Attorney at Law participating. Joseph D. Joyner, Jr. and C. Wells Hall, III, Attorneys at Law, appeared of behalf of the Taxpayer; Kay Linn Miller, Associate Attorney General, appeared on behalf of the Department of Revenue. AND IT APPEARING TO THE BOARD AS FOLLOWS: that the findings of fact made by the Assistant Secretary were supported by competent, material and substantial evidence in the record; that based upon the findings of fact, the Assistant Secretary's conclusions of law were fully supported by the findings of fact; therefore based upon the findings of fact and conclusions of law, the decision of the Assistant Secretary should be confirmed. IT IS THEREFORE ORDERED, that the Final Decision of the Assistant Secretary is confirmed in every respect. Entered this the 20th day of January, 1995. TAX REVIEW BOARD Harlan E. Boyles, Chairman State Treasurer Hugh Wells, Ex Officio Member Chairman Utilities Commission Jeff D. Batts, Appointed Member 9:22 NORTH CAROLINA REGISTER February 15, 1995 1885 IN ADDITION STATE OF NORTH CAROLINA BEFORE THE TAX REVIEW BOARD COUNTY OF WAKE IN THE MATTER OF: The Proposed Assessment of corporate income tax for the taxable years ended 30 ADMINISTRATIVE June 1988 and 30 June 1989 assessed DECISION NUMBER: 288 against J. W. Cook & Sons, Inc. THIS MATTER was heard before the Tax Review Board on 9 November 1994 in the City o Raleigh, Wake County, North Carolina. It involves an appeal by J. W. Cook & Sons, Inc., (hereinafte "Taxpayer") from the Final Decision of the Deputy Secretary of Revenue (hereinafter "Deputy Secretary" entered on 28 August 1992, sustaining a proposed assessment of corporate income tax for the taxable year ended 30 June 1988 and 30 June 1989. Chairman Harlan E. Boyles presided over the hearing with acting member, the Honorable Hug! Wells, Chairman, Utilities Commission and duly appointed member, Jeff D. Batts, Attorney at Law participating. William P. Pinna, Attorney at Law, appeared of behalf of the Taxpayer; Kay Linn Miller, Associate Attorney General, appeared on behalf of the Department of Revenue. AND IT APPEARING TO THE BOARD AS FOLLOWS: that the findings of fact made by the Deputy Secretary were supported by competent, material and substantial evidence in the record; that based upon the findings of fact, the Deputy Secretary's conclusions of law were fully supported by the findings of fact; therefore based upon the findings of fact and conclusions of law, the decision of the Deputy Secretary should be confirmed. IT IS THEREFORE ORDERED, that the Final Decision of the Deputy Secretary is confirmed in every respect. Entered this the 20th day of January, 1995. TAX REVIEW BOARD Harlan E. Boyles, Chairman State Treasurer Hugh Wells, Ex Officio Member Chairman Utilities Commission Jeff D. Batts, Appointed Member 1886 NORTH CAROLINA REGISTER February 15, 1995 9:22 IN ADDITION 5TATE OF NORTH CAROLINA COUNTY OF WAKE N THE MATTER OF: rhe Proposed Assessment of additional sales ind use tax for the period of January 1 , 1 986 hrough February 28, 1990 by the North Carolina Secretary of Revenue assessed against Robert L. Sutphen, d/b/a/ Southern Straw BEFORE THE TAX REVIEW BOARD ADMINISTRATIVE DECISION NUMBER: 289 THIS MATTER was heard before the Tax Review Board (hereinafter "Board") on 13 September 1994 n the City of Raleigh, Wake County, North Carolina. It involves an appeal by Robert L. Sutphen, d/b/a/ Southern Straw (hereinafter "Taxpayer") from the decision of the Michael A. Hannah, Assistant Secretary for Legal and Administrative Services (hereinafter "Assistant Secretary") entered on 21 March 1994 sustaining i proposed assessment of sales and use tax, plus penalties and interest, for the period of January 1, 1986 hrough February 28, 1990. Chairman Harlan E. Boyles presided over the hearing with acting member, the Honorable Hugh Wells, Chairman Utilities Commission and duly appointed member, Jeff D. Batts, Attorney at Law participating. Robert L. Sutphen appeared pro se; Kay Linn Miller, Associate Attorney General, appeared on behalf of the Department of Revenue. ISSUE Under G.S. § 105-241.2, the Tax Review Board is granted jurisdiction to hear appeals timely filed by a taxpayer regarding administrative review of the taxpayer's liability for the tax or additional tax assessed by the Secretary. The issue considered is: 1. Did the Taxpayer file a timely notice of intent to file a petition for review and a timely petition requesting review with the Tax Review Board? Under the guidelines of G.S. § 105-241. 2(a), the Taxpayer must take the following action in order to obtain administrative review: 1. Within 30 days after the Secretary's final decision is issued, file with the Tax Review Board, with a copy to the Secretary, notice of intent to file a petition for review. 2. Within 60 days after the Secretary's final decision is issued, file with the Tax Review Board, with a copy to the Secretary, a petition requesting administrative review and stating in concise terms the grounds upon which review is sought. THE TAX REVIEW BOARD CONSIDERED THE FOLLOWING FACTS AND DOCUMENTS FILED IN THIS MATTER: 9:22 NORTH CAROLINA REGISTER February 15, 1995 1887 IN ADDITION 1. On 21 March 1994, the Secretary's final decision was mailed to the Taxpayer. 2. On 19 May 1994, Taxpayer's attorney wrote the Board requesting review of the case. 3. On 26 May 1994, the Board's Executive Secretary acknowledged receipt of the 19 May 199* letter as an untimely notice of intent to file a petition for review. 4. On 16 August 1994, Taxpayer filed a letter with the Board setting forth his reasons foi requesting administrative review. BASED UPON THE FOREGOING FACTS, THE TAX REVIEW BOARD CONCLUDES AS A MATTER OF LAW: 1. The time limits specified in G.S. 105-241. 2(a) are jurisdictional in nature; the Board has no authority to consider petitions not filed within the time prescribed by law. 2. Because the Taxpayer did not file a petition within the time prescribed by 105-241. 2(a), the Taxpayer's appeal must be dismissed. IT IS THEREFORE ORDERED that the Taxpayer's appeal be, and is hereby, DISMISSED. Entered this 27th day of January, 1 995 . TAX REVIEW BOARD Harlan E. Boyles, Chairman State Treasurer Hugh Wells, Ex Officio Member Chairman Utilities Commission Jeff D. Batts, Appointed Member 1888 NORTH CAROLINA REGISTER February 15, 1995 9:22 IN ADDITION TITLE 7 - DEPARTMENT OF CULTURAL RESOURCES Notice is hereby given in accordance with G.S. 150B-21.2 that the Department of Cultural Re-sources, Division of State Library intends to amend rule cited as 7 NCAC 2E . 0301. 1 he proposed effective date of this action is May 1, 1995. Instructions on How to Demand a Public Hearing (must be requested in writing within 15 days of notice): A public hearing may be requested by sending a written request to Caroline Shepard, State Library of North Carolina, 109 E. Jones St., Raleigh, NC 27601-2807, fax (919) 733-8748. Reason for Proposed Action: This Rule change is being made to be more responsive to units of local government by formally adopting the special provision that was included in the Current Opera-tions Appropriations Act of 1993 (Senate Bill 27, Section 38). {comment Procedures: Comments may be submit-ted in writing to Caroline Shepard, State Library of North Carolina, 109 E. Jones St. , Raleigh, NC 27601-2807, fax (919) 733-8748. CHAPTER 2 - DIVISION OF STATE LIBRARY SUBCHAPTER 2E - LIBRARY DEVELOPMENT SERVICES SECTION .0300 - ALLOCATION OF STATE AID TO PUBLIC LIBRAREES 0301 QUALD7ICATIONS FOR GRANTS Libraries requesting funding from the aid to public libraries fund must meet the following requirements: (1) Be legally established as required by North Carolina statutes. (2) Provide library services easily available without discrimination to all residents of the political subdivision supporting the library. (3) Employ a director having a valid North Carolina public librarian certificate and successful experience as a public librarian (4) (5) or administrator. Secure operational funds from local government sources at least equal to the amount budgeted the previous year. A grant to a local library system from the Aid to Public Libraries Fund shall not be terminated but shall be reduced propor-tionately by the Department of Cultural Resources if the local funding for a pub-lic library was reduced by the local gov-erning body as part of an overall general budgetary reduction reflecting local eco-nomic conditions and local government fiscal constraints. State funds shall not replace local funds appropriated for public library operations. Expend funds as authorized in the adopt-ed budget. Any library having an unen-cumbered operational balance of more than 17 percent of the previous year's operating receipts will have the difference deducted from its state allocation. Obtain aggregate operational funds from local sources at least equaling state aid. Pay salaries for professional positions funded from state aid that are no less than the scale required by the Division of State Library. Obtain an annual audit of library ac-counts by a certified public accountant and submit a copy of this audit to the Division of State Library. Submit a copy of bylaws and personnel policies to the Division of State Library. Compile an assessment of the library needs of the community, prepare and annually revise a long-range plan of service, and submit copies of needs as-sessment and long-range plans of service to the Division of State Library. Submit a copy of the agreement establish-ing the regional or county library, if composed of more than one local govern-mental unit. Meet the following stipulations when establishing a new library or withdrawing from a larger system: qualify for state aid on the first day of the fiscal year, operate successfully during that year, apply for state aid after the year of successful operation. (6) (7) (8) (9) (10) (11) (12) (a) (b) (c) Statutory Authority G.S. 125-7; 143B-10. 9:22 NORTH CAROLINA REGISTER February 15, 1995 1889 PROPOSED RULES TITLE 10 - DEPARTMENT OF HUMAN RESOURCES Notice is hereby given in accordance with G.S. 150B-21.2 that the Division of Aging intends to amend rules cited as 10 NCAC 22J .0308; 22 R .0201 and .0202. 1 he proposed effective date of this action is May 1, 1995. 1 he public hearing will be conducted at 2:00 p.m. on March 3, 1995 at the Division of Aging, 693 Palmer Drive, Room 127, Raleigh, NC. Jxeasonfor Proposed Action: 10 NCAC 22] .0308 - Clarification of who may serve as in-home aides for the elderly. 10 NCAC 22R .0201 - .0202 - Clarification of boards of commissioners and area agencies on aging responsibilities through the Home and Community Care Block Grant for Older Adults. (comment Procedures: Written comments will be received by the Director of the Division of Aging through March 18, 1995. Verbal comments will be heard at the public hearing. CHAPTER 22 - AGING SUBCHAPTER 22J - IN-HOME AIDE SERVICES FOR OLDER ADULTS SECTION .0300 - SERVICE PROVISION .0308 SELECTION OF AIDES The following persons shall be allowed to serve as in home aides: W-m- Non re latives who are 4l8a-years-oetfiage or older who are qualified to perform tho tasks needed by the olient. Relatives of the client, who for this pur poso are parent, spouse, child or sibling, who are 18 years of age or older and who give up employment or tho opportu nity for employment in order to perform the — service and—whe — are qualified to perform the tasks needed by the olient. Note:—Persons who cannot serve as in home aides are those under 18 years of age ; those who are not qualified to perform the tasks needed by the olient; and those who are relatives of the client, who for this purpose are parent, spouse, ohild, or oiblinj who are unemployed or who do not have to giv up employment in order to provide tho oorvioor Agencies must have written policy regarding wh may serve as in-home aids. The written polic shall include, at a minimum, the following require ments about who may serve as in-home aides: (1) persons 18 years of age or older o emancipated minors; and (2) persons who are qualified to perform tb tasks needed by the client; and (3) whether or not the agency allows thi hiring of relatives to serve as the client' in-home aide. If the agency allows \ relative to be the client's in-home aide the policy must also address thj following requirements: fa) that relatives of the client. for thi: ill iiil liiil m £b) (4} purpose are either: a parent, spouse, child, or sibling of the client including stej relations of the client for any o: those; and that the relative must have given u employment or the opportunity foi employment in order to perform the tasks needed by the client; and any other hiring guidelines established by the agency. Statutory Authority 143B-181.9A. G.S. 1 43B-181.1(c) SUBCHAPTER 22R - HOME AND COMMUNITY CARE BLOCK GRANT FOR OLDER ADULTS SECTION .0200 - BASIS FOR GRANTING BLOCK GRANT FUNDS TO COUNTIES .0201 DEFINITIONS (a) "County Block Grant Advisory Committee" means a committee, appointed annually by the Board of County Commissioners, that represents a broad range of aging interest in the county. The committee serves to build local consensus for the County Funding Plan and to function as a resource for the County Lead Agency for Planning and Coordination by obtaining input from service provider interests, and older consumers and their families. A representative of the Area Agency on Aging shall be appointed to the committee when the Area Agency on Aging is not designated as the 1890 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES County Lead Agency for Planning and Coordination, as specified in K) NCAC 22R .0201(c). (b) "County Funding Plan" means the format developed by the Division of Aging in which counties identify the County Lead Agency for Planning and Coordination, service providers, services, and budgetary data for the provision of Home and Community Care Block Grant for Older Adults services in the county during the State Fiscal Year. (c) "County Lead Agency for Planning and Coordination" means a public or private non-private agency or office which is designated annually by the Board of County Commissioners for the purpose of developing the County Funding Plan for the provision of services through the Block Grant. County Funding Plan development responsibilities include directing the work of the County Block Grant Advisory Committee, facilitating a public hearing for the County Funding Plan prior to approval by submission to the Chairman of the Board of Commissioners, and ensuring that the approved County Funding Plan meets all requirements as specified by the Division of Aging prior to submission for approval to the Area Agency on Aging. Statutory Authority G. S. 143B-181.1(c). 143B-181.1(a)(ll); .0202 COUNTY FUNDING PLANS (a) The County Lead Agency for Planning and Coordination shall provide the County Budget Officer with a preliminary County Funding Plan which, at a minimum, specifies Home and Community Care Block Grant for Older Adults services, funding levels, and required local matching amounts by April 30 of each year. (b) Area Agencies on Aging shall grant Home and Community Care Block Grant for Older Adults funding to Counties on the basis of a the recommended County Funding Plan that has been approved submitted by the Chairman of the Board of Commissioners and submitted to the Area Agenoy on Aging . Area Agencies on Aging shall receive the County Funding Plan and, upon approval, shall grant funding to the County on the basis of the Plan. (c) The approved County Funding Plan., as approved by the Area Agency on Aging, shall be wholly a part of the Grant Agreement between the County and the Area Agency on Aging for the provision of aging services through the Home and Community Care Block Grant for Older Adults. Statutory Authority G.S. 143B-181.1(a)(ll); 143B-181.1(c). * * * ISotice is hereby given in accordance with G.S. 150B-21.2 that the DHR - Division of Medical Assistance intends to amend rules cited as 10 NCAC 26H .0102 and .0104. 1 he proposed effective date of this action is May 1, 1995. 1 he public hearing will be conducted at 1:30 p.m. on March 17, 1995 at the Division of Medi-cal Assistance, 1985 Umstead Drive, Room 132, Raleigh, N. C MXeason for Proposed Action: To end cost settle-ment for OSHA Bloodborne costs and to begin payment of non-ambulance medically necessary transportation cost. Lsomment Procedures: Written comments con-cerning this amendment must be submitted by March 1 7, 1995 to: Division of Medical Assis-tance, 1985 Umstead Drive, Raleigh, N.C., 27603, ATTN: Portia Rochelle, APA Coordinator. Oral comments may be presented at the hearing. In addition, a fiscal impact statement is available upon written request from the same address. CHAPTER 26 - MEDICAL ASSISTANCE SUBCHAPTER 26H - REIMBURSEMENT PLANS SECTION .0100 - REIMBURSEMENT FOR NURSING FACILITY SERVICES .0102 RATE SETTING METHODS (a) A rate for skilled nursing care and a rate for intermediate nursing care is determined annually for each facility to be effective for dates of service for a twelve month period beginning each October 1 . Each patient will be classified in one of the two categories depending on the services needed. Rates are derived from either filed, desk, or field audited cost reports for a base year period to be selected by the state. Rates developed from filed cost reports may be retroactively adjusted if there is found to exist more than a two percent differ- 9:22 NORTH CAROLINA REGISTER February 15, 1995 1891 PROPOSED RULES ence between the filed direct per diem cost and either the desk audited or field audited direct per diem cost for the same reporting period. Cost reports are filed and audited under provisions set forth in 10 NCAC 26H .0104. The minimum requirements of the 1987 OBRA are met by these provisions. (b) Each prospective rate consists of two compo-nents: a direct patient care rate and an indirect rate computed and applied as follows: (1) The direct rate is based on the Medic-aid cost per day incurred in the follow-ing cost centers: (A) Nursing, (B) Dietary or Food Service, (C) Laundry and Linen, (D) Housekeeping, (E) Patient Activities, (F) Social Services, (G) Ancillary Services (includes several cost centers). (2) To compute each facility's direct rate for skilled care and intermediate care, the direct base year cost per day is increased by adjustment factors for price changes as set forth in Rule .0102(c). (A) A facility's direct rates cannot exceed the maximum rates set for skilled nursing or intermediate nursing care. However, the Division of Medical Assistance may negotiate direct rates that exceed the maximum rate for ventilator dependent patients. Payment of such special direct rates shall be made only after specific prior approval of the Division of Medical Assistance. (B) A standard per diem amount will be added to each facility's direct rate, including facilities that are limited to the maximum rates, for the projected statewide average per diem costs of the salaries paid to replacement nurse aides for those aides in training and testing status and other costs deemed by HCFA to be facility costs related to nurse aide training and testing. The standard amount is based on the product of multiplying the average hourly wage, benefits, and payroll taxes of replacement nurse aides by the number of statewide hours required for training and testing of all aides divided by the projected total patient days. (3) If a facility did not report any costs foi either skilled or intermediate nursing care in the base year, the state average direct rate will be assigned as determined in Rule .0102(d) of thi Section for the new type of care. (4) The direct maximum rates are developed by ranking base-year per diem costs from the lowest to the highest in two separate arrays, one foi skilled care and one for intermediate care. Each array is weighted by total patient days. The per diem cost at the 80th percentile in each array is selected as the base for the maximum rate. The base cost in each array is adjusted foi price changes as set forth in Rule .0102(c) of this Section to determine the maximum statewide direct rates for skilled care and intermediate care. (5) Effective October 1, 1990, the direct rates will be adjusted as follows: (A) A standard per diem amount will be added to each facility's skilled ar.J intermediate rate to account for the combined expected average additional costs for the continuing education of nurses' aides; the residents' assessments, plans of care, and charting of nursing hours for each patient; personal laundry and hygiene items; and other non-nursing staffing requirements. The standard amount is equal to the sum of: (i) the state average annual salary, benefits, and payroll taxes for one registered nurse position multiplied by the number of facilities in the state and divided by the state total of patient days; (ii) the total costs of personal laundry and hygiene items divided by the total patient days as determined from the FY 1989 cost reports of a sample of nursing facilities multiplied by the annual adjustment factor described in Rule .0102(c)(4)(B) of this Section; and (iii) the state average additional pharmacy consultant costs divided by 365 days and then divided by the average number of beds per facility. 1892 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES (B) A standard amount will be added to the intermediate rate of facilities that were certified only for intermediate care prior to October 1, 1990. This amount will be added to account for the additional cost of providing eight hours of RN coverage and 24 hours of licensed nursing coverage. The standard amount is equal to the state average hourly wage, benefits and payroll taxes for a registered nurse multiplied by the 16 additional hours of required licensed nursing staff divided by the state average number of beds per nursing facility. A lower amount will be added to a facility only if it can be determined that the facility's intermediate rate prior to October 1, 1990 already includes licensed nursing coverage above eight hours per day. The add-on amount in such cases would be equal to the exact additional amount required to meet the licensed nursing requirements. (C) The standard amounts in Subparagraphs (2)(B), (5)(A), and (5)(B) of this Rule, will be retained in the rates of subsequent years until the year that the rates are derived from the actual cost incurred in the cost reporting year ending in 1991 which will reflect each facility's actual cost of complying with all OBRA '87 requirements. (6) Upon completion of any cost reporting year any funds received by a facility from the direct patient care rates which have not been spent on direct patient care costs as defined herein are repaid to the State. This will be applied by comparing a facility's total Medicaid direct costs with the combined direct rate payments received for skilled and intermediate care. Costs in excess of a facility's total prospective rate payments are not reimbursable. (7) The indirect rate is intended to cover the following costs of an efficiently and economically operated facility: (A) Administrative and General, (B) Operation of Plant and Maintenance, (C) Property Ownership and Use, (D) Mortgage Interest. (8) Effective for dates of service beginning October 1 , 1 984 and ending September 30, 1985 the indirect rates are fourteen dollars and sixty cents ($14.60) for each SNF day of care and thirteen dollars and fifty cents ($13.50) for each ICF day of care. These rates represent the first step in a two step transition process from the different SNF and ICF indirect rates paid in 1983-84 and the nearly equal indirect rates that will be paid in subsequent years under this plan as provided in this Rule. (9) Effective for dates of service beginning October 1, 1985 and annually thereafter per diem indirect rates will be computed as follows: (A) The average indirect payment to all facilities in the fiscal year ending September 30, 1983 [which is thirteen dollars and two cents ($13.02)] will be the base rate. (B) The base rate will be adjusted for estimated price level changes from fiscal year 1983 through the year in which the rates will apply in accordance with the procedure set forth in Rule .0102(c) of this Section to establish the ICF per diem indirect rate. (C) The ICF per diem indirect rate shall be multiplied by a factor of 1.02 to establish the SNF per diem indirect rate. This adjustment is made to recognize the additional administrative expense incurred in the provision of SNF patient care. (10) Effective for dates of service beginning October 1, 1989, a standard per diem amount will be added to provide for the additional administrative costs of preparing for and complying with all nursing home reform requirements. The standard amount is based on the average annual salary, benefits and payroll taxes of one clerical position multiplied by the number of facilities in the state divided by the state total of patient days. (11) Effective for dates of service beginning October 1, 1990, the indirect rate will be standard for skilled and intermediate care for all facilities and will be determined by applying the 1990-91 indirect cost adjustment factors in Rule .0102(c) of this Section to the indirect 1:22 NORTH CAROLINA REGISTER February 15, 1995 1893 PROPOSED RULES rate paid for SNF during the year beginning October 1, 1989. Thereafter the indirect rate will be adjusted annually by the indirect cost adjustment factors. (c) Adjustment factors for changes in the price level. The rate bases established in Rule .0102(b), are adjusted annually to reflect increases or decreases in prices that are expected to occur from the base year to the year in which the rate applies. The price level adjustment factors are computed using aggregate base year costs in the following manner: (1) Costs will be separated into direct and indirect cost categories. (2) Costs in each category will be accumulated into the following groups: (A) labor, (B) other, (C) fixed. (3) The relative weight of each cost group is calculated to the second decimal point by dividing the total costs of each group (labor, other, and fixed) by the total costs for each category (direct and indirect). (4) Price adjustment factors for each cost group will be established as follows: (A) Labor. The expected annual percentage change in direct labor costs as determined from a survey of nursing facilities to determine the average hourly wages for RNs, LPNs, and aides paid in the current year and projected for the rate year. The percentage change for indirect labor costs is based on the projected average hourly wage of N.C. service workers. (B) Other. The expected annual change in the implicit price deflator for the Gross National Product as provided by the North Carolina Office of State Budget and Management. (C) Fixed. No adjustment will be made for this category, thus making the factor zero. (D) The weights computed in (c)(3) of this Rule shall be multiplied times the percentage change computed in (c)(4)(A), (B) and (C) of this Rule. These products shall be added separately for the direct and indirect categories. (E) The sum computed for each category in (c)(4)(D) of this Rule shall be the price level adjustment factor for that category of rates (direct or indirect) for the coming fiscal year. (F) However, for the rate period beginning October 1, 1991 through September 30, 1992 the forecast of the N.C. Service Wages percent applied to the 1991-92 Inpatient Hospital and Intermediate Care Facility for the Mentally Retarded rates is applied to the Labor component weight computed in (c)(4)(A) of this Rule. (G) For the rate period beginning October 1, 1991 through September 30, 1992 the direct adjustment factor determined under (c)(4) of this Rule will be applied to the direct rate adjustments determined under (b)(2), (b)(5)(A) and (b)(5)(B) of this Rule (d) The skilled and intermediate direct patient care rates for new facilities are established at the lower of the projected costs in the provider's Certificate of Need application inflated to the current rate period or the average of industry base year costs and adjusted for price changes as set forth in Rule .0102(c) of this Section. A new facility receives the indirect rate in effect at the time the facility is enrolled in the Medicaid program. In the event of a change of ownership, the new owner receives the same rate of payment assigned to the previous owner. (e) Each out-of-state provider is reimbursed at the lower of the appropriate North Carolina maximum rate or the provider's payment rate as established by the State in which the provider is located. For patients with special needs who must be placed in specialized out-of-state facilities, a payment rate that exceeds the North Carolina maximum rate may be negotiated. (f) Specialized Service Rates: (1) Head Injury Intensive Rehabilitation Services. (A) A single all-inclusive prospective per diem rate combining both the direct and indirect cost components may be negotiated for nursing facilities that specialize in providing intensive rehabilitation services for head-injured patients. The rate may exceed the maximum rate applicable to other Nursing Facility services. A facility must specialize to the extent of staffing at least 50 percent of its 1894 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES Nursing Facility licensed beds for intensive head-injury rehabilitation services. The facility must also be accredited by the Commission for the Accreditation of Rehabilitation Facilities (CARF). (B) A facility's initial rate is negotiated based on budget projections of revenues, allowable costs, patient days, staffing and wages. A complete description of the facility's medical program must also be provided. Rates in subsequent years are determined by applying the average annual skilled nursing care adjustment factors to the rate in the previous year, unless either the provider or the State requests a renegotiation of the rate within 60 days of the rate notice. (C) Cost reports for this service must be filed in accordance with the rules in 10 NCAC 26H .0104, but there will be no cost settlements for any differences between cost and payments. Since it is appropriate to include all financial considerations in the negotiation of a rate, a provider will not be eligible to receive separate payments for return on equity as defined in 10 NCAC 26H .0105. (2) Ventilator Services. (A) Ventilator services approved for nursing facilities providing intensive services for ventilator dependent patients shall be reimbursed at higher direct rates as described in Subparagraph (b)(2)(A) of this Rule. Ventilator services shall be paid by combining the enhanced direct rate with the nursing facility indirect rate determined under Subparagraph (b)(ll)of this Rule. (B) A facility's initial direct rate shall be negotiated based on budget projections of revenues, allowable costs, patient days, staffing and wages. Rates in subsequent years shall be determined by applying the nursing facility direct adjustment factor to the previous 12 month cost report direct cost. (C) Cost reports and settlements for this service shall be in accordance with 10 NCAC 26H .0104 and return on equity is allowed as defined in 10 NCAC 26H .0105. (D) A single all-inclusive prospective per diem rate combining both the direct and indirect cost components may be negotiated for nursing facilities that specialize in providing intensive services for ventilator-dependent patients. The rate may exceed the maximum rate applicable to other Nursing Facility services. For ventilator services, the only facilities that shall be eligible for a combined single rate are small freestanding facilities with less than 21 Nursing Facility Beds and that serve only patients requiring ventilator services. Ventilator services provided in larger facilities shall be reimbursed at higher direct rates as described in Subparagraph (b)(2)(A) of this Rule. (g) In addition to the prospective direct per diem rates developed under this Section, effective July -h — 1992, an interim payment add on will be applied to the total rate to cover the estimated ooet required under Title 29, Part 1910, Subpart Z, Section—1910.1030 of the Code of Federal Regulations.—The interim rate will be subject to final settlement reconciliation with reasonable coot to meet the requirements of Part 1910. The final settlement reoonoiliation will be effectuated during the annual coot report settlement prooess.—An interim rate add on to the prospective rate will be allowed, subject to final settlement reoonoiliation, in subsequent rate periods until adequate cost history is available to include the cost of meeting the requirements of Part 1910 in the prospective rater Effective October J^ 1994 the bloodborne pathogen cost required under Title 29, Part 1910, Subpart 2^ Section 1910.0130 of the Code of Federal Regulations shall be included in the nursing facility's direct cost reimbursement. The initial per diem amount shall be set at the lower of the actual or eightieth percentile of bloodborne pathogen costs incurred in fiscal year 1993. (h) Religious Dietary Considerations. (1) A standard amount may be added to a nursing facility's skilled and intermediate care rates, that may exceed the maximum rates determined under Paragraph (b) of this Rule, for special dietary need for religious reasons. (2) Facilities must apply to receive this special payment consideration. In applying, facilities must document the reasons for special dietary consideration NORTH CAROLINA REGISTER February 15, 1995 1895 PROPOSED RULES for religious reasons and must submit documentation for the increased dietary costs for religious reasons. Facilities must apply for this special benefit each time rates are determined from a new data base. Fifty or more percent of the patients in total licensed beds must require religious dietary consideration in order for the facility to qualify for this special dietary rate add-on. (3) The special dietary add-on rate may not exceed more than a 30 percent increase in the average skilled and intermediate care dietary rates calculated for the 80th percentile of facilities determined under Subparagraph (b)(4) of this Rule and adjusted for annual inflation factors. This maximum add-on will be adjusted by the direct rate inflation factor each year until a new data base is used to determine rates. (4) This special dietary add-on rate will become part of the facility's direct rates to be reconciled in the annual cost report settlement. £i} Effective October J^ 1994 nursing facilities are responsible for providing medically necessary transportation for residents, unless ambulance transportation is needed. Reimbursement shall be included in the nursing facility's direct cost. The initial amount shall be based on a rjer diem fee derived from estimated industry cost for transportation and associated salaries. fj) This reimbursement limitation shall become effective in accordance with the provisions of G.S. 108A-55(c). Authority G.S. 108A-25(b); 108A-54; 108A-55; 29 C.F.R. 1910, Subpart Z; 42 C.F.R. 447, Subpart C. .0104 COST REPORTING: AUDITING AND SETTLEMENTS (a) Each facility that receives payments from the North Carolina Medicaid Program must prepare and submit a report of its costs and other financial information, such as the working trial balance, related to reimbursement annually. The report must include costs from the fiscal period beginning on October 1 and ending on September 30 and must be submitted to the state on or before the December 31 that immediately follows the September 30 year end. A new provider must submit a report for the period beginning with the date of certification and ending on September 30. Hospital based nursing facilities with a fiscal year ending other than September 30 and State operated facilities with a June fiscal year ending must file their cost reports within 90 days after their fiscal year ends. Facilities that fail to file their cost reports by the due date are subject to payment suspension until the reports are filed. The Division of Medical Assistance may extend the deadline 30 days for filing the report if, in its view, good cause exists for the delay. (b) Cost report format. The cost report must be submitted on forms and in a format and medium approved by the Division of Medical Assistance The account structure for the report is based on the chart of accounts published by the American Healthcare Association in 1979 but amended or modified to the extent necessary to meet the special reimbursement requirements of this plan. The Division of Medical Assistance will make one copy of the cost report format available to each facility (combination facilities receive only one) on or before July 1 of the reporting year for which the report is to be filed. (c) Cost finding and allocation. Costs must be reported in the cost report in accordance with the following rules and in the order of priority stated. (1) Costs must be reported in accordance with the specific provisions of this plan as set forth in this Rule. (2) Costs must be reported in conformance with the Medicare Provider Reimbursement Manual, HCEA 15. (3) Costs must be reported in conformance with Generally Accepted Accounting Principles. (d) The specific cost reporting guidelines related to this plan are set forth in the following Paragraphs. The state will publish guidelines, consistent with the provisions of this plan, concerning the proper accounting treatment for items described in this Rule as related operating expenses. The guidelines may be modified prior to the beginning of each cost reporting period. In no case, however, shall any modifications be applied retroactively. A provider should request clarification in writing from the state if there is uncertainty about the proper cost center classification of any particular expense item. (1) Nursing Cost Center includes the cost of nursing staff, medical supplies, and related operating expenses needed to provide nursing care to patients, including medical records (including forms), utilization review, the Medical Director and the Pharmacy Consultant. 1896 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES The amount of nursing time provided to each patient must be recorded in order to allocate nursing cost between skilled and intermediate nursing care. (2) Dietary Cost Center includes the cost of staff, raw food, and supplies needed to prepare and deliver food to patients. (3) Laundry and Linen Cost Center includes the cost of staff, bed linens (replacement mattresses and related operating expenses needed to launder facility-provided items). (4) Housekeeping Cost Center includes the cost of staff and supplies needed to keep the facility clean. (5) Patient Activities Cost Center includes the cost of staff, supplies, and related operating expenses needed to provide appropriate diversionary activities for patients. (6) Social Services includes the cost of social workers and related operating expenses needed to provide necessary social services to patients. (7) Ancillary Cost Center includes the cost of all therapy services covered by the Medicaid program and billable medical supplies. Providers must bill Medicare Part B for those ancillary services covered under the Medicare Part B program. Ancillary cost centers include: Radiology, Laboratory, Physical Therapy, Occupational Therapy, Speech Therapy, Oxygen Therapy, Intravenous Fluids, Billable Medical Supplies, Parenteral/Enteral Therapy and life sustaining equipment, such as oxygen concentrators, respirators, and ventilators and other specifically approved equipment. (A) Effective October 1^ 1994, a separate ancillary cost center shall be established to include costs associated with medically related transportation for facility residents. Medically related transportation costs include the costs of vehicles leased or owned by the facility, payroll costs associated with transporting residents and payments to third parties for providing these services. (8) Administrative and General Cost Center includes all costs needed to administer the facility including the staff costs for the administrator, assistants, billing and secretarial personnel, personnel director and pastoral expenses. It includes the costs of copy machines, dues and subscriptions, transportation, income taxes, legal and accounting fees, start-up, and a variety of other administrative costs as set forth in the Chart of Accounts. Interest expense other than that stemming from mortgages or loans to acquire physical plant items shall be reported here. (9) Property Ownership and Use: (A) This cost center includes all allowable costs related to the acquisition and/or use of the physical assets including building, fixed equipment and movable equipment, that are required to deliver patient care, except the special equipment, as specified in .0104(d)(7) of this Rule that may be charged to the life-sustaining equipment cost center. Specifically it includes the following items: (i) all equipment expense regardless of equipment nature, (ii) lease expense for all physical assets, (iii) depreciation of assets utilizing the straight line method, (iv) interest expense of asset related liabilities, (e.g., mortgage expense), (v) property taxes. (B) For the purposes of computing allowable lease expense and for balance sheet presentation for Return on Equity computations (see Rule .0105), leases shall not be capitalized. (C) In establishing the allowable cost for depreciation and for interest on capital indebtedness, with respect to an asset which has undergone a change of ownership, the valuation of the asset shall be the lesser of allowable acquisition cost less accumulated depreciation to the first owner of record on or after July 18, 1984 or the acquisition cost to the new owner. Depreciation recapture will not be performed at sale. The method for establishing the allowable related capital indebtedness shall be as follows: (i) The allowable asset value shall be divided by the actual acquisition NORTH CAROLINA REGISTER February 15, 1995 1897 PROPOSED RULES cost, (ii) The product computed in step 1 shall be multiplied times the value of any related capital indebtedness, (iii) The result shall be the liability amount upon which interest may be recorded at the rate set forth in the debt instrument or such lower rate as the state may prove is reasonable. The allowable asset and liability values established through the process in this Rule shall be those used in balance sheet presentations for return on equity computation (see Rule .0105). These procedures are established to implement the provisions of PL 98-369 Section 2314. (10) Operation of Plant and Maintenance Cost Center includes all costs necessary to operate or maintain the functionality and appearance of the plant. These include: maintenance staff, utilities, repairs and maintenance to all equipment. (11) Equipment Expense. Equipment is defined as an item with a useful life of more than two years and a value greater than five hundred dollars ($500.00). Equipment ownership and use costs shall be reported in the Property Ownership and Use Cost Center. Equipment maintenance and repair costs shall be reported in the Operation of Plant and Maintenance Cost Center. Equipment shall not be reported elsewhere. (12) Training Expense. Training expense must be identified in the appropriate benefiting cost center. The costs of training nurse aides must be identified separately and may include the cost of purchasing programs and equipment that have been approved by the State for training or testing. (13) Home Office Costs. Home office costs are generally charged to the Administrative and General Cost Centers. In some cases, however, certain personnel costs which are direct patient care oriented may be allocated to "direct" patient care cost centers if time records are maintained to document the performance of direct patient care services. No Home office overhead may be so allocated. The basis of this allocation among facilities participating in the North Carolina Medicaid program may be: (A) specific time records of work performed at each facility, or (B) patient days in each facility to which the costs apply relative to the total patient days in all the facilities to which the costs apply. (14) Management Fees. Management fees are charged to the Administrative and General Cost Center. In some cases, however, a portion of a management fee may be allocated to a direct patient care cost center if time records are maintained to document the performance of direct patient care services. The amount so allocated may be equal only to the salary and fringe benefits of persons who are performing direct patient care services while employed by the management company. Adequate records to support these costs must be made available to staff of the Division of Medical Assistance. The basis of this allocation among facilities participating in the North Carolina Medicaid program may be: (A) specific time records of work performed at each facility, or (B) patient days in each facility to which the costs apply relative to the total patient days in all the facilities to which the costs apply. (15) Related Organization Costs. It is the nursing facility's responsibility to demonstrate by convincing evidence to the satisfaction of the Division of Medical Assistance that the costs are reasonable. Reasonable costs of related organizations are to be identified in accordance with direct and indirect cost center categories as follows: (A) Direct Cost: (i) Compensation of direct care staff such as nursing personnel (aides, orderlies, nurses), food service workers, housekeeping staff and other personnel who would normally be accounted for in a direct cost center, (ii) Supplies and services that would 1898 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES normally be accounted for in a direct cost center, (iii) Capital, rental, maintenance, supplies/repairs and utility costs (gas, water, fuel, electricity) for facilities that are not typically a part of a nursing facility. These facilities might include such items as warehouses, vehicles for deliv-ery and offices which are totally dedicated or clearly exceed the number, size, or complexity required for a normal nursing facility, its home office, or man-agement company, (iv) Compensation of all adminis-trative staff who perform no duties which are related to the nursing facility or its home office and who are neither officers nor owners of the nursing facilities or its home office. (B) Indirect Cost: (i) Capital, rental, maintenance, supplies/repairs, and utility costs which are normally or frequently a part of a nursing facility. This would include, for example, kitchen and laundry facilities, (ii) Home office costs except for salary and fringe benefits of Per-sonnel, Accounting and Data Processing staff which are allocat-ed by acceptable methods are direct costs when the work per-formed is specific to the related organization that provides a direct care service or product to the provider, (iii) Compensation of all administra-tive staff who perform any duties for the nursing facility or its home office, (iv) All compensation of all officers and owners of the nursing facility or its home office, or parent corporation. The related organization must file a Medicaid Cost Statement (DMA-4083) identifying their osts, adjustments to costs, allocation of costs, equity capital, adjustments to equity capital, and ^locations of equity capital along with the nursing facilities cost report. A home office, or parent ompany, will be recognized as a related organiza- :ion. Auditable records to support these costs must be made available to staff of the Division of Medical Assistance and its designated contract auditors. Undocumented costs will be disallowed. It is the nursing facility's responsibility to demon-strate by convincing evidence to the satisfaction of the Division of Medical Assistance that the criteria in the Provider Reimbursement Manual, Section 1010, has been met in order to be recognized as an exception to the related organization principle. When a related organization is deemed an excep-tion; reasonable charges by the related organiza-tion to the nursing facility are recognized as allowable costs; receivable/payables from/to the nursing facility and related organization deemed an exception are not adjusted from the nursing facility's balance sheet in computing equity capital. (e) Auditing and Settlement. All filed cost reports must be desk audited and interim reimbursement settlements made in accordance with the provision of this plan. This settlement is issued within 1 80 days of the date the cost report was filed or within 180 days of December 31 of the fiscal year to which the report applies, whichever is later. The state may elect to perform field audits on any filed cost reports within three years of the date of filing and issue a final settlement on a time schedule that conforms to Federal law and regulation. If the state decides not to field audit a facility a final reimbursement notice may be issued based on the desk audited settlement. The state may reopen and field audit any cost report after the final settlement notice to comply with Federal law and regulation or to enforce laws and regulations prohibiting abuse of the Medicaid Program and particularly the provisions of this reimbursement plan. (f) This reimbursement limitation shall become effective in accordance with the provisions of G.S. 108A-55(c). Authority G.S. W8A-25(b); 108A-54; 108A-55; 42 C.F.R. 447, Subpart C. TITLE 15A - DEPARTMENT OF ENVIRONMENT, HEALTH, AND NATURAL RESOURCES CHAPTER 2 - ENVIRONMENTAL MANAGEMENT COMMISSION The Environmental Management Commis-sion is extending the public comment period from February 20, 1995 to March 20, 1995 for the proposed rule modifications in Subchapter 2B .0100, 2B .0200 and 2H .0500, governing issuance 9:22 NORTH CAROLINA REGISTER February 15, 1995 1899 PROPOSED RULES of 401 Water Quality Certifications and water quality standards for wetlands. Because of the significant public interest in the proposed rules, the record will remain open until March 20th to allow additional written comments received after Febru-ary 20th to become part of the official record. The proposed rule changes were published in the North Carolina Register, Volume 9, Issue 17, pages 1348-1367 (9:17 NCR 1348-1367). The proposed rules affected are cited as 15A NCAC 2B .0101, .0103, .0109, .0201, .0202, .0220, and 15A NCAC 2H .0501, .0502, .0503, .0504, .0506, and .0507. The Division will accept written comments received through March 20, 1995. For information on the proposed rule changes or the comment period extension, contact Ron Ferrell, North Carolina Division of Environ-mental Management, RO. Box 29535, Raleigh, NC 27606-0535, (919-733-0026). The Division of Environmental Manage-ment is extending the public comment period from January 16, 1995, until March 1, 1995, for the proposed rules defining potential emissions for various types of sources. These rules were pub-lished on November 15, 1994 in the North Caroli-na Register, Volume 9, Issue 16, pages 1261-1283 (9:16 NCR 1261-1283). The proposed rules are cited as 15A NCAC 2Q .0801 -.0807. All persons interested in these matters are invited to submit written comments. The Division will accept written comments through Wednesday, March 1st for inclusion in the hearing record. Comments should be sent to and additional information concerning the proposals may be obtained by contacting: Mr. Thomas Allen Division of Environmental Management P.O. Box 29535 Raleigh, North Carolina 27626-0535 (919) 733-1489 (Phone) (919) 733-1812 (Fax) Notice is hereby given in accordance with G.S. 150B-21.2 that the N. C. Wildlife Resources Com-mission intends to amend rules cited as 15A NCAC WB .0106 and 10F .0354. 1 he proposed effective date of this action is July 1, 1995. 1 he public hearing will be conducted at 10:0 a.m. on March 6, 1995 at the Archdale Building Room 332, 512 N. Salisbury Street, Raleigh, N 27604. Ixeason for Proposed Action: ISA NCAC 10B .0106 - To establish requirement and procedures for wildlife damage control agenti To establish requirements and procedures fo mounting by taxidermists of wildlife and bin accidentally killed by automobile. 15A NCAC 10F .0354 - To regulate boat speed i congested area. Lsomment Procedures: Interested persons ma present their views either orally or in writing the hearing. In addition, the record of hearin will be open for receipt of written comments froi February 15, 1995 through March 17, 1995. Sue written comments must be delivered or mailed t the N. C. Wildlife Resources Commission, 512 P Salisbury Street, Raleigh, N C. 27604-1188. CHAPTER 10 - WILDLIFE RESOURCES AND WATER SAFETY SUBCHAPTER 10B - HUNTING AND TRAPPING SECTION .0100 - GENERAL REGULATIONS .0106 WILDLIFE TAKEN FOR DEPREDATIONS OR ACCIDENTALLY (a) Depredation Permit: (1) Endangered or Threatened Species. N permit shall be issued to take any ei dangered or threatened species of wil< life listed under 15A NCAC 101 reason of depredations to property. A individual may take an endangered threatened species in immediate defens of his own life or of the lives of othe without a permit. Any endangered c threatened species which may constitu a demonstrable but non-immedia threat to human safety shall be reporte to a federal or state wildlife enforo ment officer, who, upon verification < the report, may take or remove tl 1900 NORTH CAROLINA REGISTER February 15, 1995 9:2 PROPOSED RULES specimen as provided by 15A NCAC 101 .0002. (2) Other Wildlife Species. Except as provided in Subparagraph (1) of this Paragraph, the Executive Director or an agent of the Wildlife Resources Com-mission may, upon application of a landholder and after such investigation of the circumstances as he may require, issue a permit to such landholder to take any species of wildlife which is or has been damaging or destroying his property provided there is evidence of substantial property damage. No per-mit may be issued for the taking of any migratory birds and other federally protected animals unless a correspond-ing valid U.S. Fish and Wildlife Ser-vice depredation permit has been is-sued. The permit shall name the spe-cies allowed to be taken and, in the discretion of the Executive Director or an agent, may contain limitations as to age, sex or any other condition within the species so named. The permit may be used only by the landholder or an-other person named on the permit. ,exoept that, upon written requeot of th e landholder and when it is conclusively determined on the basis of information oubmitted by him that ho io incapable of aooompliohing—the — necessary—oontrol without help, the nameo of additional persons may be entered upon the permit by the Executive Director as authorized users. (3) Wildlife Damage Control Agents: Upon satisfactory completion of a Wildlife Resources Commission ap-proved training and satisfactory demon-stration of a knowledge of wildlife laws and safe, humane wildlife handling techniques, an individual may apply to the Wildlife Resources Commission (Commission) to become a Wildlife Damage Control Agent (WDCA). Those persons approved as agents by the Commission may then issue depre-dation permits to landholders and list themselves as a second party to provide the control service. WDCAs may not issue depredation permits for big game animals, bats, or species listed as en-dangered, threatened or special concern under Rules 101 .0003, .0004 and .0005 of this Chapter. WDCAs must report to the Wildlife Resources Com-mission the number and disposition of animals taken, by county, annually. Records must be available for inspec-tion by a Wildlife Enforcement officer at any time during normal business hours. WDCA status may be revoked at any time by the Executive Director when there is evidence of violations of wildlife laws, failure to report, or inhumane treatment of animals by the WDCA. WDCAs may not charge for the permit, but may charge for their investigations and control services. In order to maintain a knowledge of cur-rent laws, rules, and techniques. WDCA's must renew their agent status every three years by showing proof on having attended at least one Wildlife Commission approved training course provided for the purpose of reviewing and updating information on wildlife laws and safe, humane wildlife handling techniques within the previous 12 months. (b) Term of Permit. Each depredation permit issued by the Executive Director or an agent shall have entered thereon a date or time of expiration after which date or time the same shall become invalid for any purpose, except as evidence of lawful possession of any wildlife that may be retained thereunder. (c) Manner of Taking: (1) Taking Without a Permit. Wildlife taken without a permit while committing depredations to property may, during the open season on the species, be taken by the landholder by any lawful method. During the closed season such depredating wildlife may be taken without a permit only by the use of firearms. (2) Taking With a Permit. Wildlife taken under a depredation permit may be taken only by the method or methods specifically authorized by the permit. The—esly — methods—that—may—be authorized in talcing game species, other than foxes, io by the use of firearms and—live — traps. The — permit—may authorize th« taking ef- foxes, furbearing—animals,—and — nongame animals or birds by the uso of firearms or traps, including steel traps. When 9:22 NORTH CAROLINA REGISTER February 15, 1995 1901 PROPOSED RULES trapping is authorized, in order to limit the taking to the intended purpose, the permit may specify a reasonable distance from the property sought to be protected, according to the particular circumstances, within which the traps must be set. The Executive Director or agent may also state in a permit authorizing trapping whether or not bait may be used and the type of bait, if any, that is authorized. In addition to any trapping restrictions that may be contained in the permit the method of trapping must be in accordance with the requirements and restrictions imposed by G.S. 1 13-291 .6 and other local laws passed by the General Assembly . No depredation permit shall authorize the use of poisons or pesticides in taking wildlife except in accordance with the provisions of the North Carolina Pesticide Law of 1971, the Structural Pest Control Act of 1955, and Article 22A of Chapter 113 of the General Statutes of North Carolina. No depredation permit shall authorize the taking of wildlife by any method by any landholder upon the lands of another. (3) Intentional Wounding. It is unlawful for any landholder, with or without a depredation permit, intentionally to wound a wild animal in a manner so as not to cause its immediate death as suddenly and humanely as the circumstances permit. (d) Disposition of Wildlife Taken: (1) Generally. Except as provided by the succeeding Subparagraphs of this Paragraph, any wildlife killed accidentallyT or without a permit while committing depredations , or under a depredation permiH shall be buried or otherwise disposed of in a safe and sanitary manner on the property, where the depredations took place, of the landholder in whose name the permit-is issued or who kills suoh wildlife while committing—depredations. Wildlife killed under a depredation permit may be transported to an alternate disposal site if desired. Anyone in possession of carcasses of animals being transported under a depredation permit must have the depredation permit in their possession. Except as provided by the (2) (3) succeeding Subparagraphs of (d)(2) through (6) of this Rule, all wildlife killed under a depredation permit must be buried or otherwise disposed of in a safe and sanitary manner. Deer. Any landholder who lullo a doc* under—a currently—valid—deprodatioB permit for deer must report ouoh kill The edible portions of up to five deer may be retained by the landholder for consumption but must not be transported from the property where the depredations took place without a valid depredation permit. An enforcement officer, within 24 hours and beforo the doer is butohered for consumption to a wildlife enforcement officer, who upon determining that th e kill wao lawfully made within the scope of th e permit -aad if so requested by the permittee, shall provide the permittee a written authorization for his own private uoo or the use by a charitable organization of the edible portions of the carcass. The nonedible portions of the carcass, including head, hide, feet, and antlers shall be disposed of as specified in Subparagraph (1) of this Paragraph or turned over to a wildlife enforcement officer for disposition. When a deer is accidentally killed on a road or highway by reason of collision with a motor vehicle, the law enforcement officer who investigates the accident shall upon request of the operator of the vehicle, provide such operator a written permit authorizing him to possess and transport the carcass of such deer for his personal and lawful use, including delivery of such carcass to a second person for his private use or the use by a charitable organization upon endorsement of such permit to such person or organization by name and when no money or other consideration of value is received for such delivery or endorsement. Fox. Any fox killed accidentally by a dog or dogs, motor vehicle, or otherwise shall be disposed of as provided by Subparagraph (1) of this Paragraph. Any fox killed under a depredation permit may be disposed of in the same manner or, upon compliance with the fur tagging 1902 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES requirements of 15A NCAC 10B .0400, the carcass or pelt thereof may be sold to a licensed fur dealer. Any live fox taken under a depredation permit may be sold to a licensed controlled hunting preserve for fox in accordance with G.S. 113-273(g). (4) Furbearing Animals. The carcass or pelt of any furbearing animal killed during the open season for taking such furbearing animal either accidentally or for control of depredations to property, whether with or without a permit, may be sold to a licensed fur dealer provided that the person offering such carcass or pelt for sale has a valid hunting or trapping license, provided further that, bobcats and otters may only be sold upon compliance with any required fur tagging requirement set forth in 15A NCAC 10B .0400. (5) Animals Taken Alive. Wild animals in the order garnivora and beaver shall be humanely euthanized either at the site of capture or at an appropriate facility designed to humanely handle the euthanasia or released on the property where captured. Animals transported or held for euthanasia must be euthanized within 12 hours of capture. Anyone in possession of live animals being transported for relocation or euthanasia under a depredation permit must have the depredation permit in their possession. (5) Nongame Animals aed Birds. Nongame — animals—e?—birds—killed accidentally er fef control ef depredations—may be disposed of as provided by Subparagraph (1) of this Paragraph or in any other safe and sanitary manner. (6) A person killing a wild bird or wild animal accidentally with a motor vehicle or finding a dead wild bird or wild animal which was killed accidentally may possess that wild bird or wild animal for a period not to exceed 10 days for the purpose of delivering it to a licensed taxidermist for preparation. The licensed taxidermist may accept the wild bird or wild animal after satisfying himself that the animal was killed accidentally. The taxidermist shall certify and record the circumstances determined by of acquisition as his injury. Licensed taxidermists shall keep accurate records of each wildlife specimen received pursuant to the Rule as required by Rule 10H .1003 of this Chapter. Upon delivery of the finished taxidermy product to the person presenting the animal, the taxidermist shall give the person a receipt in the form required by the Wildlife Resources Commission indicating the species, date of delivery, circumstances of initial acquisition and any other information that may be required on the form. A copy of this receipt shall be filed with the Wildlife Resources Commission within 10 days of the date of delivery of the mounted specimen. The receipt shall serve as the non-transferable permit for continued possession of the mounted specimen and shall be retained by the person for as long as the mounted specimen is kept. Mounted specimens possessed pursuant to this Rule may not be sold and, if such specimens are transferred by gift or inheritance, the new owner must apply for a new permit and must submit the written receipt originally obtained from the taxidermist to document the legality of possession. This provision does not allow possession of accidentally killed raptors; migratory birds; species listed as endangered, threatened, or of special concern under Rules 101 .0003, .0004, and .0005 of this Chapter; bear or wild turkey. (e) Reporting Requirements. Any landholder who kills a deer, bear or wild turkey under a currently valid depredation permit shall report such kill on the form provided with the permit and mail the form immediately upon the expiration date to the Wildlife Resources Commission. The killing and method of disposition of ever)' game animal and game bird, every furbearing animal, and every nongame animal or nongame bird for which there is no open season, when killed for committing depredations to property, either with or without a permit, shall be reported to the Wildlife Resources Commission within 24 hours following th e time of such lulling, except that when th e carcass or pelt of a fox, kill ed under a depredation permit, or of a furbearing animal, killed with or without a permit, is lawfully sold to a lice nsed fur dealer in NORTH CAROLINA REGISTER February 15, 1995 1903 PROPOSED RULES thin State tho fur dealer is required to report the souroe of acquisition and no report is required of the seller. Statutory Authority G.S. 113-134; 113-273; 113-274; 113-291.4; 113-291.6; 113-300.1; 113-300.2; 113-307; 113-331; 113-333; 113-334(a); 113-337. SUBCHAPTER 10F - MOTORBOATS AND WATER SAFETY SECTION .0300 - LOCAL WATER SAFETY REGULATIONS .0354 PITT COUNTY (a) Regulated Areas. This Rule applies to the waters described in this Paragraph: (1) The entire inlet of Hardee Creek from the Tar River in Pitt County. (2) That portion of the Tar River beginniflg at the curve approaohing Seine Beach to the East side of the Grimesland Bridge as marked at each end by appropriate markers. The Seine Beach area of the Tar River beginning at Chicod Creek and extending to the east side of the Grimesland Bridge as marked by appropriate markers. (b) Speed Limit. No person shall operate a motorboat or vessel at greater than no-wake speed within the regulated areas described in Paragraph (a) of this Rule. (c) Placement and Maintenance of Markers. The Board of Commissioners of Pitt County is designated a suitable agency for placement and maintenance of markers implementing this Rule. Statutory Authority G.S. 75A-3; 75A-15. TITLE 18 - SECRETARY OF STATE iSotice is hereby given in accordance with G.S. 150B-21.2 that the N. C. Department of the Secre-tary of State intends to amend rules cited as 18 NCAC6 .1201 and .1210. 1 he proposed effective date of this action is May 1. 1995. 1 he public hearing will be conducted at 10:00 a.m. on March 2, 1995 at the Legislative Office Building, 300 N. Salisbury St. , Suite 100, Confer-ence Room, Raleigh, NC 27603. Ixeason for Proposed Action: To facilitate greater investment opportunities for North Carolina inves-tors. Lsomment Procedures: Interested persons may present oral or written statements at the public hearing, or in writing prior to the hearing by mail addressed to Mr. Gene Cella, Administrator, Securities Division, N. C. Dept. of the Secretary of State, 300 N. Salisbury St. , Raleigh, NC 27603. For copies of any information relating to the hearing call (919) 733-3924, or write to the aforementioned address. The comment period will end on March 17, 1995. CHAPTER 6 - SECURITIES DIVISION SECTION .1200 - EXEMPTIONS .1201 DESIGNATED SECURTTTES EXCHANGES The national securities exchanges designated by the administrator for the purposes of G.S. 78A-16(8) shall be: (1) New York Stock Exchange, (2) American Stock Exchange, (3) Midwest Stock Exchange, (4) Pacific Stock Exchange^ (5) Philadelphia Stock Exchange. Statutory Authority G.S. 78A-16(8). .1210 SECURITIES EXCHGS/AUTO QUOTATION SYS APPROVED/ ADMINISTRATOR For purposes of G.S. 78A-16(15), the following securities exchanges and automated quotation systems are approved provided such exchanges or systems comply with the provisions of Paragraphs (1) through (4) of the Memorandum of Understanding regarding a Model Uniform Marketplace Exemption From State Securities Registration Requirements [SEC Release 33-6810 (December 16, 1988), CCH NASAA Reports, par. 11,120] or the Memorandum of Understanding between The North American Securities Administrators Association, Inc. and The Philadelphia Stock Exchange, Inc., incorporated herein by reference. The incorporated material may be obtained, free of charge, from the North Carolina Secretary of State, Securities Division, 1904 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES 30 North Salisbury Street, Suite 100, Raleigh, orth Carolina 27603-5909 : (1) New York Stock Exchange, (2) American Stock Exchange, (3) Pacific Stock Exchange, (4) Midwest Stock Exchange, (5) NASDAQ National Market System, and (6) Chicago Board Options Exchange^ and (7) Philadelphia Stock Exchange. tatutory Authority G.S. 78A-16(15); 150B-21.6. TITLE 21 - OCCUPATIONAL LICENSING BOARD :HAPTER 2 - BOARD OF ARCHITECTURE Sotice is hereby given in accordance with G.S. 50B-21.2 that the North Carolina Board of rchitecture intends to amend rules cited as 21 1CAC 2 .0101, .0108, .0201 - .0202, .0204 - 1206, .0208 - .0210, .0212, .0215 - .0216, .0302 .0303, .0402, .0405, .0603; adopt 21 NCAC 2 0218 - .0219; repeal 21 NCAC 2 .0103 - .0105, 9207 and .0602. p he proposed effective date of this action is June , 1995. n he public hearing will be conducted at 9:00 m. on March 22, 1995 at the Methodist Build-ig, 1307 Glenwood Avenue, Raleigh, NC 27605. xeason for Proposed Action: 1 NCAC 2 .0101 - Need to relocate office. 1 NCAC 2 .0103 - Rule is duplicative of statute. G.S. 83A-2) I NCAC 2 .0104 - Rule is duplicative of statute. G.S. 83A-5) '1 NCAC 2 .0105 - Rule is duplicative of statute. G.S. 83A-14) \1 NCAC 2 .0108 - Sets out current applicable ees for Board services. M NCAC 2 .0201 - Sets out requirements for vritten notice offirm or address changes. \1 NCAC 2 .0202 - Requires licensees to affirm hey have read current architectural laws and Tiles. II NCAC 2 .0204 - Provides for inclusion of imited liability companies and partnerships in llowable forms ofpractice. U NCAC 2 .0205 - Provides language to include limited liability companies and partnerships. 21 NCAC 2 . 0206 - Clarifies the requirements and guidelines for use of the architectural seal. 21 NCAC 2 .0207 - Rule is duplicative of statute. (G.S. 83A-15) 21 NCAC 2 .0208 - Defines dishonest conduct. 21 NCAC 2 .0209 - Defines unprofessional con-duct. 21 NCAC 2 . 0210 - Defines incompetent conduct. 21 NCAC 2 .0212 - Defines certain types of conflicts of interest. 21 NCAC 2 .0215 - Prohibits foreign corporations from evading registration requirements by practic-ing through an individual license. 21 NCAC 2 .0216 - Requires a limited liability partnership to annually submit a list of partners. 21 NCAC 2 .0218 - Establishes the requirements necessary to practice as a limited liability compa-ny. 21 NCAC 2 .0219 - Establishes the requirements necessary to practice as a limited liability partner-ship. 21 NCAC 2 .0302 - Clarifies and extends the opportunity for exam applicants qualified under prior rules to sit for the exam. 21 NCAC 2 .0303 - Provides for alternative means of obtaining reciprocal registration. 21 NCAC 2 .0402 - Change Statutory reference within Rule. 21 NCAC 2 .0405 - Removes language stating a requirement already covered by statute. 21 NCAC 2 .0602 - Rule is duplicative of statute. 21 NCAC 2 .0603 - Clarifies who may request a hearing. Lsomment Procedures: Any person interested in these rules may present oral comments relevant to the action proposed at the public rule-making hearing or deliver written comments to the Board office not later than Wednesday, March 22, 1995. Anyone planning to attend the hearing should notify the Board office by noon Friday, March 17, 1995 whether they wish to speak on the proposals. Speakers will be limited to 5 minutes. SECTION .0100 - GENERAL PROVISIONS .0101 AUTHORITY: NAME AND LOCATION OF BOARD The "North Carolina Board of Architecture," subsequently herein referred to as the "Board," is established and authorized by Chapter 83A of the General Statutes of North Carolina. Unless other-wise directed, all communications should be h22 NORTH CAROLINA REGISTER February 15, 1995 1905 PROPOSED RULES addressed to the Board at 501 North Blount Street, Raleigh, North Carolina 27604 127 West Hargett Street, Suite 304, Raleigh, North Carolina 27601 . Statutory Authority G.S. 83A-2; 83A-6. .0103 DUTIES OF OFFICERS (a) President.—The president ohall, when pre s ent, preside at all meetings, appoint all oommit teos , sign all certificates issued and perform all other duties pertaining to his office . {&) — Vice Pres ident.—The vice president, in th e absence of the president, shall perform ail of th e duties of the president. (o) Seoretary,—The secretary, with th e assistance of an executive director, shall: (4^ conduct and care for all th e oorrespon denoe of th e Board, keep th e minutes of all the meetings, keep all books and records, and shall also sign all certifi eatos issued; {3} have charge, oare and custody of the official—documents—by — order—ef-—the Board; {£) provide — due notice—of the time and place of all meetings of the Board to each member of the Board; f4) keep a record of the proceedings of th e Board and registration for all applicants for registration and admission to prao tice architecture, giving the name and looation of the institution or place of training where the applicant was pre pared for the practice of architecture, and such other information as the Board may deem proper and useful. This registration shall be prima facie evi denoe of all matters recorded therein; {&) mail a copy of "Chapter 83A Archi tects" of th e North Carolina General Statutes and the rules of the Board to each architect licensed with the Board. (d) Treasurer.—With the assistance of an exeou tive director, th e treasurer shall: <4^ receive -aelHl- monies from architect fef annual renewal or other fees and depos it them in an authorized depository of the Board; (3) give bond in such sums as the Board shall determine, with suoh security as shall be approved by th e Board, said bond to be conditioned on the faithful performance of the duti es of the office, and on the faithful accounting of all monies and other property. Statutory Authority G.S. 83A-2; 83A-3; 83A-5, 83A-6. .0104 PROCEDURE (a) — Order of Business.—The President shall determine the general order of business to be followed at eaoh meeting of the Board and ohall generally follow the Rules of Parliamentary Procc (b) — Books and Records.—The following records shall be kept in the Board office under the roopon sibl e charge of the executive director and conoti tute the official records of the Board: fB Minutes and Reports.—There will be a book containing all minutes and offioial m-reports in proper order; Other Documents. Other documents will be filed and arranged so ao to properly care for applicants' papers. bills and receipts, general eorrespon donoo, material concerning the laws and procedure of other states and all other papers whioh are to be temporarily or permanently preserved. Statutory Authority G. S. 83A-5; 83A-6. .0105 DISCD7LINARY ACTION AND PROCEDURE The procedure to be followed in conducting disciplinary actions shall be in aooord with G.S 8 3A 1 4 and Chapter 150B of the North Carolina General Statutes. Statutory Authority G.S. 83A-6; 83-14. .0108 FEES Fees required by the Board, are payable in advance and are set forth below: Initial Registration Application Individual Residents $50.00 Nonresidents S 50.00 Corporate $75.00 Examination At Cost (See Rule .0301) Initial Exam Application $50.00 Re-examination $25.00 Annual license renewal Individual $50.00 Corporate $100.00 Late renewal Penalty $ 50.00 Reciprocal registration $150.00 Individual Reinstatement (prior year's renewal and late fees plus current 1906 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES renewal fee) $250.00 Copies of the roster and other publications and services provided by the Board are available at cost from the Board office. Statutory Authority G. S. 83A-4. SECTION .0200 - PRACTICE OF ARCHITECTURE .0201 BOARD LISTING OF INDrVIDUAL AND FORM NAMES Every individual licensee, partnership, firm or corporation has the continuing responsibility of keeping the Board currently advised of his or its proper and current mailing address and the name or names under which he or it is practicing. Each licensee or firm shall immediately notify the Board in writing of any and all changes of association or address. Upon the dissolution of a professional relationship, the architect member or members thereof shall promptly notify the Board in writing concerning such dissolution, and of the succeeding status and addresses of the individual or firm. rhis requirement is in addition to registration, isting and renewal requirements set out elsewhere in these Rules. Statutory Authority G.S. 83A-5; 83A-6. 0202 APPLICABDLITY OF BOARD RULES The Executive Director shall mail a copy of Chapter 83A of the North Carolina General Stat-utes and the rules of the Board adopted hereunder to each licensed architect in and out of the state to whom a new license has been issued, by virtue of laving successfully completed the prescribed sxamination and having otherwise met the Board's equirements for registration. Rules adopted and jublished by the Board under the provisions of Chapter 83A and Chapter 150B shall be binding ipon every individual holding a license from the Board, and upon all professional corporations egally authorized to offer or to perform architec-tural services in this state. All licensees of the Board are charged with having knowledge of the sustence of the Board rules and shall be deemed o be familiar with their several provisions and to mderstand them. Each licensed person and entity shall affirm in their renewals that they have read he current architectural laws and rules. Statutory Authority G.S. 83A-6. .0204 FORMS OF PRACTICE The practice of architecture may be carried on by sole practitioners, partnerships, professional limited liability companies, registered limited liability partnerships or registered architectural corporations, provided all those who practice are duly licensed, and the firm is properly described and identified by its name or title. Whenever the practice of architecture is carried on by a partner-ship, all partners must be duly licensed in North Carolina . Statutory Authority G.S. 83A-4; 83A-6; 83A-8; 57C-2-01; 59-84.2; 59-84.3. .0205 NAME OF FIRM (a) A licensee shall not engage in the practice of architecture under a professional or firm name which is misleading or deceptive in any way as to the legal form of the firm or the persons who are partners, officers, members, or shareholders in the firm. Examples of misleading or deceptive firm names include but are not limited to the following: (1) Use of the plural in any form when the number of architects in a firm does not warrant such use or, (2) Use of the name of an employee unless that employee is a partner, member or shareholder or, (3) Use of the name of deceased architect in order to benefit from his reputation, when that architect was not a former partner, officer, member or shareholder in the present firm, or (4) Use of a name which is deceptively similar to that of existing firm name. (b) Names of all architectural firms, whether sole proprietorships, partnerships, professional limited liability companies, registered limited liability partnerships or professional corporations, shall be approved in writing by the Board before adopted or used by such firm. Provided, however, that this Rule shall not be construed to require any firm to seek approval of, or to change, any name duly adopted in conformity with Board rules in effect at the date of such adoption other than a change that results in a violation of Subparagraph fa) (1) of this Rule . Statutory Authority G.S. 83A-6; 83A-9; 83A-12; 55B-5. .0206 REQUIREMENT FOR AND USE OF PROFESSIONAL SEAL h22 NORTH CAROLINA REGISTER February 15, 1995 1907 PROPOSED RULES (a) As more fully set out in this Rule, an architect must seal his work whether or not the work is for an exempt project. An architect shall not sign nor seal drawings, specifications, reports or other professional work which were not pre-pared by the architect or under his direct supervi-sion; provided, however, that in the case of the portions of such professional work prepared under the direct supervision of persons employed by the architect or the architect's firm and who are (4)(d) registered in this state, the architect may sign and seal those portions of the professional work if the architect has reviewed such portions and has coordinated their preparation. "Direct supervision" shall be that degree of supervision by a person overseeing the work of another whereby the supervisor has control over and detailed knowledge of the work prepared under his supervision. (_Q(a) Individual Seal Design. Every licensed architect shall have an individual seal which shall be composed of two con-centric circles with outer and inner circle diameters of approximately VA inches and 1 inch respectively. The architect's name and place of business shall be between the inner and outer circles. The words "Registered Archi-tect, North Carolina" shall be along the inside perimeter of the inner circle. The architect's North Carolina registra-tion number shall be in the center of the inner circle. (5)(«) {2}(b) Corporate Seal Design. Every corpora-tion which shall have obtained from the Board a certificate for corporate prac-tice shall have a corporate seal, which shall be composed of two concentric (6)(f) circles with outer and inner circle diam-eters of approximately 1 Vi inches and 1 inch respectively. The Architectural Corporation's approved North Carolina name and place of business shall be between the inner and outer circles. The words "Registered Architectural Corporation, North Carolina" shall be along the inside perimeter of the inner circle. The corporation's North Caroli- (l)(s) na registration number shall be in the center of the inner circle. £3)(e) Seal Types. The seal required for use on opaque original contract documents not intended for duplication shall be of a type which will produce an impres-sion facsimile of the seal, or a rubber stamp which will produce an ink fac-simile of the seal. The seal required for use on transparent original contract documents intended for duplication shall be of a type which will produce an ink facsimile of the seal such as a rub ber stamp, deoal, or computer generat ed type. The use of pre-printed docu ments bearing a pre-printed facsimile of the seal is prohibited. Individual Seal, Signature and Date Required. Architects shall affix their seal, actual signature, and date of affix-ation to all original contract documents including index sheets identifying all dmwingB—covered—specification—cover and index pages identifying all opooifi cation pages covered and supplemental drawings—whioh—afe — developed—aed issued under the direct oupervioion oi authorship of the arohitoct an contract dooumenta. architectural documents to be filed for public record. Document; shall be signed personally and sealed by the responsible architect. Final official record documents (such as tracings) shall be so signed. The signing and sealing of the index sheet or sheets {ij it identifies all parts) of drawings and specifications shall be considered ade quate. Without such index, all sheets and pages shall be so signed and sealed Presentation Documents. Presentation documents (renderings, drawings usee to communicate conceptual information only) are not required to be sealed oi signed. Incomplete Documents. Documents considered incomplete by the architect may be released for interim review without the architect's seal or signature affixed, but shall be dated, bear the architect's name and be conspicuously marked to clearly indicate the docu ments are for interim review and not intended for bidding, permit, or con struction purposes. Sheets or Pages Prepared By Licensed Professional Consultants. Those sheets or pages prepared by licensed profes sional consultants (such as, for exam pie, structural, mechanical or electrical engineers) retained by the architect shall bear the seal and registration number of the consultant responsibl therefore. 1908 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES (8){f) Original Signature. The use of signa-ture reproductions such as rubber stamps or computer generated or other facsimiles shall not be permitted in lieu of actual signatures. (9}(j) Security of Seal. Authorized use of the prescribed seal is an individual act whereby the architect must personally sign over the imprint of the seal. The architect is responsible for security of the seal when not in use. 10)(k) Use of Corporate Seal. The use of the corporate seal does not replace the statutory requirement for an architect's individual seal as required in Subpara-graph (d) (a)(4) . The corporate seal must be affixed in addition to the indi-vidual seal on the cover sheet and each page of the table of contents of specifi-cations and drawings. (b) Standard Design Documents. Standard design documents prepared by architects who are registered in this state or in their state of origin may be sealed by a succeeding licensed architect registered in North Carolina provided: (1) the seal of the original architect appears on the documents to authenticate au-thorship; (2) the words "standard design document" appear on each sheet of the documents prepared by the original architect; (3) the succeeding North Carolina architect clearly identifies all modifications to the standard design documents; (4) the succeeding North Carolina architect assumes responsibility for the adequacy of the design for the specific application in North Carolina and for the design conforming with applicable building codes; and (5) the succeeding North Carolina architect affixes his seal to the standard design documents and a statement substantially as follows: "These documents have been properly examined by the under-signed. I have determined that they comply with existing local North Caro-lina codes, and I assume responsibility for the adequacy of the design for the specific application in North Carolina." (c}{fe) Direct Supervision. No architect shall iffix his seal and signature to contract documents ieveloped by others not under his direct supervi-sion. Direct supervision includes: (1) Dissemination of programmatic re-quirements, (2) Ongoing coordination and correlation of consultant's work services with other aspects of the total design of the pro-ject, (3) Verification with consultant that owner's requirements are being met, (4) Authority over the work services of those who assisted in the preparation of the documents, (5) Assumption of responsibility for the consultant's work, services, and (6) Incorporation of cons ultant's — work services into design documents to be issued for permitting purposes. Statutory Authority G.S. 83A-6; 83A-10; 83A-12. .0207 DENIAL: SUSPENSION OR REVOCATION OF LICENSE (a) Denial.—The Board may refuse to grant an examination, or after examination refuse to grant a lic ense for the practice of architecture, to any person convicted of a felony,—or who,—in th e opinion of the Board, has been guilty of di shonest or unprofessional conduct, or lacks good moral character as defined in G.S. 8 3A 1(5). {&) — Discipline Affecting License .—The Board may l evy a civil penalty, reprimand, suspend for a — period—ef- — time,—ef—reveke—any — corporate certificate of regi s tration or di scipline a licensee pursuant to G.S. 83A 15. Statutory Authority G.S. 83A-1; 83A-6; 83A-7; 83A-15. .0208 DISHONEST CONDUCT In addition to tho se grounds as s tated in G.S. 83A 15(1) the following act s or omissions, among others, may be deemed to be "dishonest conduct" and to be cause for th e levy of a civil penalty or for a denial, suspension, or revocation of a license ef c ertificate ef- regi stration te practice architecture : fB Deceitful Statements.—It s hall be deemed di shonest conduct to—make untrue or deceitful statements in an application for examination, any other application to the Board—ef — m—any — statements—ef representations—te—the — Board—ef— a committee of the Board. (a) Deception. An architect shall not deliberately make a materially false statement or fail deliberately to disclose a material fact requested in connection with his application for 9:22 NORTH CAROLINA REGISTER February 15, 1995 1909 PROPOSED RULES registration renewal. (b) Contributions, offer nor make any An architect shall neither gifts, other than gifts of nominal value (including, for example, reasonable entertainment and hospitality), with the intent of influencing the judgement of an existing or prospective client in connection with a project in which the architect is interested. (c) Registration of Others. An architect shall not assist the application for registration of a person known by the architect to be unqualified with respect to education, training, experience, or character. (d) Knowledge of Violation. An architect possessing knowledge of a violation of these Rules by another architect shall report such knowledge to the Board. (3) Misrepresentation.—It shall be deemed dishonest conduct for an architect—to permit the use of his professional seal by others, or otherwise represent himself as the author of drawings or specifications which are not personally prepared by him ef under his direct supervision. However,—"standard design documents" prepared by architects who are registered in this state or in th eir state of origin may be— s ealed—by—a — succeeding—lic ensed architect—registered—in North—Carolina provided: {a) the seal of the original architect appears en—the — doouments—te — authenticate authorship; <+H th e words " s tandard d esign docume nt" appear on each sh eet of the documents prepared by the original architect; {e} the succeeding North Carolina architect clearly identifies all modifications to the standard design documents; {d) the succeeding North Carolina architect assumes responsibility for th e adequacy of th e des ign for th e specific application in North Carolina and for th e design conforming—with — applicable — building codes; and the succeeding North Carolina architect affixes his seal to the standard design doouments and a statement substantially &- -feik "Th ese documents have been properly examined—by—the undersigned. 1 have determined that th ey comply with existing local North Carolina codes. and 1 assume responsibility for th e adequacy of th e design for the specific application in m- North Carolina." Contributions. 4t — shall—be—dee»e< dishonest conduct—for an architect t< make or promise to make contributions o money—or service,—with the intent h bribe,—for the purpose of securing i commission e-F — influencing—tt engagement—er— e mployment—ef-—ai architect for a project. Statutory Authority G.S. 83A-6; 83A-15. .0209 UNPROFESSIONAL CONDUCT In addition to those grounds as stated in G.S 83A-15(3) the following acts or omissions, amonj others, may be deemed to be "unprofessiona conduct", and to be cause for the levy of a civi penalty or for denial, suspension, or revocation o a license or certificate of registration to practice architecture: (1) Compliance With Laws. It shall b< deemed unprofessional conduct for ai architect, in the conduct of his or he professional practice, to knowingl; violate any state or federal criminal law A criminal conviction shall be deeme< prima facie evidence of knowingl) violating the law. (2) Compliance With Foreign Registration It shall be deemed unprofessional conduc for an architect to knowingly violate the laws governing the practice architecture or the rules promulgated bj any other architectural licensing board ii any United States jurisdiction. A findin by a foreign architectural registratio board that an architect has violated a law or rule governing the practice o architecture shall be deemed prima faci evidence of knowingly violating the law or rule. (3) Product Specification. It shall be deeme< unprofessional conduct for an architect tc solicit or accept financial or othe: valuable consideration from material o equipment suppliers for specifying thei products. (4) Advertising. It shall be deemec unprofessional conduct for an architect tc engage in any false, deceptive fraudulent, or misleading advertising. (5) False Statements. It shall be deemec unprofessional conduct for an architect U knowingly make false statements abou the professional work or to malicious!) 1910 NORTH CAROLINA REGISTER February 15, 1995 9:2. PROPOSED RULES injure the prospects, practice, or employment position of others active in the design and construction of the physical environment. (6) Evasion. (a) It shall be deemed unprofessional conduct for an architect, through employment by building contractors, or by another not holding an individual or corporate certificate from the Board, to enable the employer to offer or perform architectural services, except as provided in G.S. 83A-13. In design/build arrangements, the architect shall not be an employee of a person or firm not registered or licensed to practice architecture in North Carolina. (b) It shall be deemed unprofessional conduct for an architect to furnish limited services in such manner as to enable owners, draftsmen, or others to evade the public health and safety requirements of Chapter 83A or the building permit requirements of Chapter 160A of the North Carolina General Statutes. G.S. 133-2, G.S. 153A-26 or G.S. 160A-417. (c) When building plans are begun or contracted for by persons not properly licensed and qualified, it shall be deemed unprofessional conduct for an architect to take over, review, revise, or sign or seal such drawings or revisions thereof for such persons, or do any act to enable either such persons or the project owners, directly or indirectly, to evade the requirements of Chapter 83A or G.S. 160A-417. (7) Branch Office. U—sbaH—be — deemed unprofessional conduct for an architect to maintain or represent by sign, li sting, or other manner that he maintains an arohi teotural office or branch offioe unless suoh office is continuously staffed with a registered arohiteot in oharge.—Provided, however, that this Rule does not apply to on site project offioes during oonstruo tion. Each office maintained for the preparation of drawings, specifications, reports, or other professional work shall have an architect resident and regularly employed in that office having direct knowledge and supervisory control of such work. ) Misrepresentation Regarding Prior Expe-rience. Because of the rolianoo the pub lie plaoes on architects' qualifications, the following—requirements—afe — provided regarding the representation of pas t pro fessional experience. An architect shall accurately represent to a prospective or existing client or employer his qualifica-tions and the scope of his responsibility in connection with work for which he is claiming credit. (a) It shall be the responsibility of each registered architect to clearly and ap-propriately state prior professional experience of the architect and/or the firm the architect is representing in presenting qualifications to prospective clients, both public and private. If an architect uses visual representations of prior projects or experience, all architects-of-record must be clearly identified. Architect-of-record means persons or entities whose seals appear on plans, specifications and/or contract documents. (b) An architect who has been an employee of another architectural practice may not claim unconditional credit for pro-jects contracted for in the name of the previous employer. The architect shall indicate, next to the listing for each project, that individual experience gained in connection with the project was acquired as an employee, and identify the previous architectural firm. The architect shall also describe the nature and extent of his/her participa-tion in the project. (c) An architect who was formerly a princi-pal in a firm may legitimately make additional claims provided he/she dis-closes the nature of ownership in the previous architectural firm (e.g. stock-holder or junior partner) and identifies with specificity his/her responsibilities for that project. (d) An architect who presents a project that has received awards recognition must comply with the requirements in Sub-paragraph (8) of this Rule with regard to project presentation to the public and prospective clients. (e) Projects which remain unconstructed and which are listed as credits should be listed as "unbuilt or a similar desig-nation. 22 NORTH CAROLINA REGISTER February 15, 1995 1911 PROPOSED RULES (9) Influencing Government Officials. An architect shall neither offer nor make any payment or gift to a government official (whether elected or appointed) with the intent of influencing the official's judgment in connection with a prospective or existing project in which the architect is interested, (10) Fee Bidding on Public Projects. An architect shall not knowingly cooperate in a violation of any provisions of G.S. 143- 64.31. (11) Cooperation with Board. An architect shall fully cooperate with the Board in connection with any inquiry it shall make. Full cooperation includes responding in a timely manner to all inquiries of the Board or representative of the Board and claiming Board correspondence from the U.S. Postal Service. Statutory Authority G.S. 83A-6; 83A-15. .0210 INCOMPETENCE Any architect who has suffered impairment of skill and oare in rendering professional services due to a mental or physical disability or addiction to alcohol or drugs so as to potentially endanger the health, safety and welfare of the public- may voluntarily surrender his license to th e Board at any time prior to a filing of a Notice of Hearing in a contested case.—The Board, in its discretion, may accept the surrender, or reject the surrender and prooood to a Notice of Hearing under the provisions of Chapter 150B. (a) In practicing architecture, an architect shall act with reasonable care and competence and shall apply the technical knowledge and skill which is ordinarily applied by architects of good standing, practicing in the same locality. (b) In designing a project, an architect shall take into account all applicable state and municipal building laws and regulations. While an architect may rely on the advice of other professionals (e.g., attorneys, engineers and other qualified persons) as to the intent and meaning of such regulations, once having obtained such advice, an architect shall not knowingly design a project in violation of such laws and regulations. (c) An architect shall undertake to perform professional services only when he, together with those whom the architect may engage as consultants, are qualified by education, training and experience in the specific technical areas involved. (d) No person shall be permitted to practk architecture, if, in the board's judgment. su< person's professional competence is substantial impaired by physical or mental disabilities. Statutory Authority G.S. 83A-6; 83A-15. .0212 INDEPENDENT JUDGMENT AND DISCLOSURE Upon reoeipt of information or complaint, tt Board,—m—its — discretion,—may — investigate ai incidence of the all eged prohibited praotioo-architecture — in North—Carolina by—individual firm s—ef — corporations—net—duly — licensed regi stered—by—the — Board. Following—sw investigation, the Board shall determine whether net—te—take — legal—action—by—way — of crimin pro secution or injunction or such oth er action as deems necessary to prevent the unlicensed practk of architecture. (a) When acting as the interpreter of buildii contract documents and the judge of contra performance, an architect shall render decisioi impartially, favoring neither party to the contract (b) If, in the course of his work on a project. architect becomes aware of a decision taken by h employer or client, against the architect's advici which violates applicable state or municip; building laws and regulations and which will, the architect's judgment, materially affe< adversely the safety to the public of the finishe project, the architect shall: (1) report the decision to the local buildin inspector or other public offici 12} £3} charged with the enforcement of tl applicable state or municipal buildin laws and regulations; refuse to consent to the decision; in circumstances where the archite< reasonably believes that other sue decisions will be taken notwithstandin his objection, terminate his service (4} with reference to the project; and in the case of termination in accordanc with clause in Subparagraph (b)(3) ( this Rule, the architect shall have n liability to his client or employer o account of such termination. (c) If an architect has any business associatio or direct or indirect financial interest which i substantial enough to influence his judgment i connection with the performance of profession. services, the architect shall fully disclose i writing to his client or employer the nature of th business association or financial interest, and if th 1912 NORTH CAROLINA REGISTER February 15, 1995 9:2 eing compensated for making such statements. tatutory Authority G.S. 83A-6; 83A-15. D215 FOREIGN CORPORATIONS (a) Incorporation in Other States. Architectural orporations of other states may be granted orporate certificates for practice in this State on le receipt by the Board of a completed pplication, the submission of a certified copy of leir corporate charter, amended as may be ecessary to insure full compliance with all squirements of Chapter 55B, the Professional lorporation Act of the State of North Carolina, nd the payment of the corporate application fee. a addition to the other requirements as set out in i.S. 83A-8, foreign corporations must, prior to sgistration, receive from the Secretary of State of forth Carolina a certificate of authority to do usiness within the state. The registration squirements for foreign corporations cannot be PROPOSED RULES lient or employer objects to such association or nancial interest, the architect will either terminate uch association or interest or offer to give up the ommission or employment. (d) An architect making public statements on rchitectural questions shall disclose when he is voided by practice in North Carolina through an idividual licensee. (b) Designated Individuals. Foreign orporations shall be permitted to practice rchitecture within the State of North Carolina rovided that at least two-thirds of the issued and utstanding shares of the foreign corporations are wned by licensed architects or engineers who are censed to practice their profession in a lrisdiction of the United States. However, the orporation must designate at least one architect /ho is licensed in the State of North Carolina to e in responsible charge for the corporate practice f architecture within the State of North Carolina. 'tatutory Authority G.S. 55B-6; 83A-6; 83A-8. 0216 ANNUAL LISTING OF PARTNERSHIP (a) By December 31 of each year, each artnership or registered limited liability lartnership engaged in the practice of architecture n North Carolina shall submit a list of all resident nd non-resident partners of the partnership, (b) One annual listing by a representative of the partnership shall satisfy the requirements of aragraph (a) of this Rule for all partners of the inn; however, each partner shall remain responsible for compliance with the rules. (c) Changes in the information required by Paragraph (a) of this Rule shall be filed with the Board office within 30 days after the change occurs. Statutory Authority G.S. 83A-6; 83A-9. .0218 LIMITED LIABILITY COMPANIES Architects may practice in this state through duly authorized limited liability companies only as provided under G.S. 57C-2-01(c). Any limited liability company that offers to practice or practices architecture in this state must comply with the same requirements applicable to professional corporations under Rules .0201, .0202, .0204, .0205, .0214. and .0215 of this Chapter. Statutory Authority G.S. 57C-2-01; 83A-6. .0219 REGISTERED LIMITED LIABILITY PARTNERSHIPS Architects may practice in this state through duly registered limited liability partnerships only as provided under G.S. 59-84.2 and G.S. 59-84.3. Any registered limited liability partnership that offers to practice or practices architecture in this state must comply with the same requirements applicable to partnerships under Rules .0201, .0202, .0204, .0205, and .0216 of this Chapter. Statutory Authority G.S. 83A-6; 59-84.2; 59-84.3. SECTION .0300 - EXAMINATION PROCEDURES .0302 WRITTEN EXAMINATION (a) Licensure Examination. All applicants for architectural registration in North Carolina by written examination must pass the Architectural Registration Examination (ARE), administered in North Carolina, prepared by the National Council of Architectural Registration Boards (NCARB). Provided, applicants who have never been registered in any state or territory may transfer credits for portions of the examination previously passed in another state if at the time of taking the exam elsewhere they otherwise qualified for taking the exam in North Carolina. (1) Description. The nature of the examination is to place the candidate in areas relating to actual architectural situations whereby his abilities to exercise competent value judgements K-22 NORTH CAROLINA REGISTER February 15, 1995 1913 PROPOSED RULES (2) will be tested and evaluated. Qualifications. The prequalifications necessary for an applicant's admission to the Architectural Registration examination (ARE) are as follows: (A) be of good moral character as defined in North Carolina General Statute 83A-K5); (B) be at least 18 years of age; (C) hold a degree in architecture from a college or university where the degree program has been approved by the Board, or professional education equivalents as outlined and defined in the North Carolina Board of Architecture's
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Title | North Carolina register |
Date | 1995-02-15 |
Description | Vol. 9, issue 22 (February 15, 1995) |
Publisher | Raleigh, N.C. : Office of Administrative Hearings |
Digital Characteristics-A | 88 p.; 5.17 MB |
Digital Format | application/pdf |
Pres File Name-M | pubs_serial_ncregister19950215.pdf |
Pres Local File Path-M | \Preservation_content\StatePubs\pubs_serial_ncregister\images_master |
Full Text | Z_j Kl^rJ / 74-34-/- Az/^lbT-The NORTH CAROLINA REGISTER IN THIS ISSUE COWa TITUl itiomI EXECUTIVE ORDERS IN ADDITION Tax Review Board PROPOSED RULES Architecture, Board of Cultural Resources Environment, Health, and Natural Resources Human Resources Secretary of State LIST OF RULES CODDTED RRC OBJECTIONS CONTESTED CASE DECISIONS RECEIVES FEB 16 1995 KATHRINl R EVERETT LAW LIBRARY ISSUE DATE: February 15, 1995 Volume 9 • Issue 22 • Pages 1883 - 1962 INFORMATION ABOUT THE NORTH CAROLINA REGISTER AND ADMINISTRATIVE CODF. NORTH CAROLINA REGISTER The North Carolina Register is published twice a month and contains information relating to agency, executive, legislative and judicial actions required by or affecting Chapter 150B of the General Statutes. All proposed administrative rules and notices of public hearings filed under G.S. 1 50B-2 1 .2 must be published in the Register. The Register will typically comprise approximately fifty pages per issue of legal text. State law requires that a copy of each issue be provided free of charge to each county in the state and to various state officials and institutions. The North Carolina Register is available by yearly subscription at a cost of one hundred and five dollars ($105.00) for 24 issues. Individual issues may be purchased for eight dollars ($8.00). Requests for subscription to the North Carolina Register should be directed to the Office ofAdministrative Hearings, P. O. Drawer 27447, Raleigh, N.C. 27611-7447. ADOPTION, AMENDMENT, AND REPEAL OF RULES The following is a generalized statement of the procedures to be followed for an agency to adopt, amend, or repeal a rule. For the specific statutory authority, please consult Article 2A ofChapter 1 50B of the General Statutes. Any agency intending to adopt, amend, or repeal a rule must first publish notice of the proposed action in the North Carolina Register. The notice must include the time and place of the public hearing (or instructions on how a member of the public may request a hearing); a statement of procedure for public comments; the text of the proposed rule or the statement of subject matter; the reason for the proposed action; a reference to the statutory authority for the action and the proposed effective date. Unless a specific statute provides otherwise, at least 15 days must elapse following publication of the notice in the North Carolina Registerbefote the agency may conduct the public hearing and at least 30 days must elapse before the agency can take action on the proposed rule. An agency may not adopt a rule that differs substantially from the proposed form published as part of the public notice, until the adopted version has been published in the North Carolina Register for an additional 30 day comment period. When final action is taken, the promulgating agency must file the rule with the Rules Review Commission (RRC). After approval by RRC, the adopted rule is filed with the Office of Administrative Hearings (OAH). A rule or amended rule generally becomes effective 5 business days after the rule is filed with the Office of Administrative Hearings for publication in the North Carolina Administrative Code (NCAC). Proposed action on rules may be withdrawn by the promulgating agency at any time before final action is taken by the agency or before filing with OAH for publication in the NCAC. TEMPORARY RULES Under certain emergency conditions, agencies may issue ten rary rules. Within 24 hours of submission to OAH, the Codifn Rules must review the agency's written statement of findings of for the temporary rule pursuant to the provisions in G.S. 150B-21 the Codifier determines that the findings meet the criteria in 150B-21.1, the rule is entered into the NCAC. If the Cod determines that the findings do not meet the criteria, the rule is retu to the agency. The agency may supplement its findings and resul the temporary rule for an additional review or the agency may resp that it will remain with its initial position. The Codifier, thereafter, enter the rule into the NCAC. A temporary rule becomes effe< either when the Codifier of Rules enters the rule in the Code or or sixth business day after the agency resubmits the rule without cha The temporary rule is in effect for the period specified in the rule or days, whichever is less. An agency adopting a temporary rule n begin rule-making procedures on the permanent rule at the same t the temporary rule is filed with the Codifier. NORTH CAROLINA ADMINISTRATIVE CODE The North Carolina Administrative Code (NCAC) is a compila and index of the administrative rules of 25 state agencies arid occupational licensing boards. The NCAC comprises approxima 15,000 letter size, single spaced pages of material of which appr< mately 35% is changed annually. Compilation and publication of NCAC is mandated by G.S. 150B-21.18. The Code is divided into Titles and Chapters. Each state agenc assigned a separate title which is further broken down by chapt Title 21 is designated for occupational licensing boards. The NCAC is available in two formats. (1) Single pages may be obtained at a minimum cost of I dollars and 50 cents ($2.50) for 10 pages or less, plus fift cents ($0.15) per each additional page. (2) The full publication consists of 53 volumes, totaling excess of 15,000 pages. It is supplemented monthly « replacement pages. A one year subscription to the publication including supplements can be purchased seven hundred and fifty dollars ($750.00). Individual v umes may also be purchased with supplement service. 1 newal subscriptions for supplements to the initial publicat are available. Requests for pages of rules or volumes of the NCAC should directed to the Office of Administrative Hearings. CITATION TO THE NORTH CAROLINA REGISTER The North Carolina Register is cited by volume, issue, p< number and date. 1:1 NCR 101-201, April 1, 1986 refers to Volu 1 , Issue 1 , pages 101 through 201 ofthe North Carolina Registerissv on April 1, 1986. FOR INFORMATION CONTACT: Office of Administra-tive Hearings, ATTN: Rules Division, P.O. Drawer 27447, Raleigh, North Carolina 2761 1-7447, (919) 733-2678. NORTH CAROLINA REGISTER Office of Administrative Hearings P. O. Drawer 27447 Raleigh, North Carolina 27611-7447 (919) 733-2678 ISSUE CONTENTS I. EXECUTIVE ORDERS Executive Orders 69-71 1883 II. IN ADDITION Tax Review Board 1885 ID. PROPOSED RULES Cultural Resources State Library, Division of 1889 Environment, Health, and Natural Resources Environmental Management .... 1899 Wildlife Resources 1900 Human Resources Aging, Division of 1890 Medical Assistance 1891 Licensing Board Architecture, Board of 1905 Secretary of State Securities Division 1904 Julian Mann III, Director James R. Scarcella Sr., Deputy Director Molly Masich, Director ofAPA Services Staff: Ruby Creech, Publications Coordinator Teresa Kilpatrick, Editorial Assistant Jean Shirley, Editorial Assistant This publication is printed on permanent, acid-free paper in compliance with G.S. 125-11.13. IV. LIST OF RULES CODIFIED 1917 V. RRC OBJECTIONS 1923 VI. CONTESTED CASE DECISIONS Index to ALJ Decisions 1927 Text of Selected Decisions 94 DOA 0516 1943 94 OSP 0655 1949 VII. CUMULATrVE INDEX 1959 NORTH CAROLINA REGISTER Publication Schedule (November 1994 - September 1995) Volume and Issue Number Issue Date Last Day for Filing Last Day for Elec-tronic Filing Earliest Date for Pubbc Hearing 15 days from notice * End of Required Comment Period 30 days from notice Last Day to Submit toRRC ** Earliest Effective Date 9:15 11/01/94 10/11/94 10/18/94 11/16/94 12/01/94 12/20/94 02/01/95 9:16 11/15/94 10/24/94 10/31/94 11/30/94 12/15/94 12/20/94 02/01/95 9:17 12/01/94 11/07/94 11/15/94 12/16/94 01/03/95 01/20/95 03/01/95 9:18 12/15/94 11/22/94 12/01/94 12/30/94 01/17/95 01/20/95 03/01/95 9:19 01/03/95 12/08/94 12/15/94 01/18/95 02/02/95 02/20/95 04/01/95 9:20 01/17/95 12/21/94 12/30/94 02/01/95 02/16/95 02/20/95 04/01/95 9:21 02/01/95 01/10/95 01/18/95 02/16/95 03/03/95 03/20/95 05/01/95 9:22 02/15/95 01/25/95 02/01/95 03/02/95 03/17/95 03/20/95 05/01/95 9:23 03/01/95 02/08/95 02/15/95 03/16/95 03/31/95 04/20/95 06/01/95 9:24 03/15/95 02/22/95 03/01/95 03/30/95 04/17/95 04/20/95 06/01/95 10:1 04/03/95 03/13/95 03/20/95 04/18/95 05/03/95 05/22/95 07/01/95 10:2 04/17/95 03/24/95 03/31/95 05/02/95 05/17/95 05/22/95 07/01/95 10:3 05/01/95 04/07/95 04/17/95 05/16/95 05/31/95 06/20/95 08/01/95 10:4 05/15/95 04/24/95 05/01/95 05/30/95 06/14/95 06/20/95 08/01/95 10:5 06/01/95 05/10/95 05/17/95 06/16/95 07/03/95 07/20/95 09/01/95 10:6 06/15/95 05/24/95 06/01/95 06/30/95 07/17/95 07/20/95 09/01/95 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 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. 15OB-21.2(f) for adoption procedures. ** The "Earliest Effective Date " is computed assuming that the agency follows the publication schedule above, 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 10/94 EXECUTIVE ORDERS EXECUTIVE ORDER NO. 69 GOVERNOR'S COUNCIL ON CHILDREN, YOUTH, AND FAMHJES WHEREAS, the State of North Carolina should promote and encourage collaboration and collabo-rative planning and delivery of services among State agencies that serve the needs of children and families; WHEREAS, the State of North Carolina should make more effective use of existing federal and state resources and programs; WHEREAS, the State of North Carolina should streamline government, including the delivery of services and eliminate duplication; and WHEREAS, the State of North Carolina should promote and enhance state-level leadership in achieving these goals; NOW, THEREFORE, by the power vested in me as Governor by the Constitution and laws of the State of North Carolina, IT IS ORDERED: Section 1. Establishment. The Governor's Council on Children, Youth, and Families is hereby established. Section 2. Duties. (a) The Governor's Council on Children, Youth, and Families shall: (i) Provide state-level leadership on issues affecting children, youth, and families, including children with special needs; (ii) Foster collaboration and coordination between and among the many state agencies with responsibility for provid-ing services to children, youth, and families; (iii) Help develop and carry out a unified and comprehensive long-range children's and families' agenda; and (iv) Promote accountability for achieving the State's goals in a timely and effective manner. (b) The Council shall meet biannually and report to the Governor on its progress in meeting the intent and purpose set forth in this Executive Order. The Governor may convene the Council at other times during the year as necessary to achieve these goals. (c) The Governor shall chair the Council. The Governor shall appoint a Vice-Chair of the Coun-cil, who shall chair the Council in his absence. (d) The Governor shall set the agenda for the Council's meetings and shall take into consider-ation its reports in setting policy for children, youth, and families. (e) The Council may establish such committees, task forces, or other working groups as are neces-sary to assist in performing its duties. The Coun-cil may invite non-members to serve on such groups. (f) Existing executive commissions, councils, and advisory committees with responsibility for issues affecting children, youth, and families shall advise and assist the Council in performing its duties and responsibilities. Section 3. Membership. (a) The Council shall consist of the following members or their designees: (i) The Governor's Senior Education Advi-sor; (ii) The Secretary of Environment, Health, and Natural Resources; (iii) The Secretary of Human Resources; (iv) The Secretary of Cultural Resources; (v) The Secretary of Commerce; (vi) The Secretary of Transportation; and (vii) The Secretary of Administration. (b) The following individuals shall be invited to serve as members of the Council and may appoint a designee: (i) The Lieutenant Governor; (ii) The Superintendent of Public Instruc-tion; (iii) The Chair of the State Board of Educa-tion; (iv) The Commissioner of Labor; (v) The President of the North Carolina Community College System; (vi) The President of the University of North Carolina; (vii) The Director of the Administrative Office of the Courts; (viii) The Chair of the North Carolina Part-nership for Children, Inc.; (ix) The Chairs of the House of Representa-tives and Senate appropriations subcom-mittees for human resources (one from each body); and (x) The Chairs of the House of Representa-tives and Senate substantive committees with responsibility for human services 9:22 NORTH CAROLINA REGISTER February 15, 1995 1883 EXECUTIVE ORDERS programs affecting children, youth and families (one from each body). Section 4. Staff Assistance. The Department of Human Resources shall provide clerical support and other services re-quired by the Council. This order shall be effective immediately. Done in the City of Raleigh this the 24th day of January, 1995. EXECUTIVE ORDER NO. 70 REISSUING EXECUTIVE ORDER NO. 37, CITIZEN ACCESS TO PUBLIC RECORDS MAINTAINED BY STATE GOVERNMENT WHEREAS, Executive Order No. 37, signed January 28, 1994, expired October 28, 1994; and WHEREAS, Executive Order No. 37 implement-ed a trial period for the Departments of Adminis-tration and Transportation to develop an electronic register of public information; and WHEREAS, the Information Resources Manage-ment Commission has reviewed the implementation of Executive Order No. 37 and has recommended that the trial period be extended. NOW, THEREFORE, by the power vested in me as Governor by the Constitution and laws of the State of North Carolina, IT IS ORDERED: Executive Order No. 37, Citizen Access to Public Records Maintained by State Government, is hereby reissued, without changes, until July 1, 1995. The IRMC is requested to make further recommendations prior to the expiration of this Order. This Order shall be effective immediately. Done in the City of Raleigh this the 25th day of January, 1995. EXECUTIVE ORDER NO. 71 EXTENDING EXECUTIVE ORDERS 2, 6, 9, 10, 11, 15, 16, 17 AND 19 By the power vested in me as Governor by the Constitution and laws of the State of North Caroli-na, IT IS ORDERED: The following Executive Orders are hereby extended: A. Executive Order No. 2, Small Business Council; B. Executive Order No. 6, Entrepreneurial Development Board; C. Executive Order No. 9, Commission foi a Competitive North Carolina; D. Executive Order No. 10, Quality Leader ship Awards Council; E. Executive Order No. 11, Governor's Council of Fiscal Advisors; F. Executive Order No. 15, Coordinating Committee on the Americans with Dis-abilities Act; G. Executive Order No. 16, The Geographic Information Coordinating Council; H. Executive Order No. 17, North Carolina Emergency Response Commission; and I. Executive Order No. 19, Center for the Prevention of School Violence. This Order shall be effective immediately and shall expire two years from this day. Done in the City of Raleigh this the 26th day of January, 1995 1884 NORTH CAROLINA REGISTER February 15, 1995 9:22 IN ADDITION STATE OF NORTH CAROLINA COUNTY OF WAKE [N THE MATTER OF: rhe Proposed Assessment of corporate income tax for the taxable years of 1988, 1989, 1990 assessed against BellSouth Telecommunications, Inc. (formerly Southern Bell Telephone and Telegraph Company). BEFORE THE TAX REVIEW BOARD ADMINISTRATIVE DECISION NUMBER: 287 THIS MATTER was heard before the Tax Review Board on 9 November 1994 in the City of Raleigh, Wake County, North Carolina. It involves an appeal by BellSouth Telecommunications, Inc. (formerly Southern Bell Telephone and Telegraph Company), (hereinafter "Taxpayer") from the Final Decision of Michael A. Hannah, Assistant Secretary for Legal and Administrative Services (hereinafter "Assistant Secretary") entered on 20 April 1994, sustaining a proposed assessment of corporate income tax for the taxable years of 1988, 1989 and 1990. Chairman Harlan E. Boyles presided over the hearing with acting member, the Honorable Hugh Wells, Chairman, Utilities Commission and duly appointed member, Jeff D. Batts, Attorney at Law participating. Joseph D. Joyner, Jr. and C. Wells Hall, III, Attorneys at Law, appeared of behalf of the Taxpayer; Kay Linn Miller, Associate Attorney General, appeared on behalf of the Department of Revenue. AND IT APPEARING TO THE BOARD AS FOLLOWS: that the findings of fact made by the Assistant Secretary were supported by competent, material and substantial evidence in the record; that based upon the findings of fact, the Assistant Secretary's conclusions of law were fully supported by the findings of fact; therefore based upon the findings of fact and conclusions of law, the decision of the Assistant Secretary should be confirmed. IT IS THEREFORE ORDERED, that the Final Decision of the Assistant Secretary is confirmed in every respect. Entered this the 20th day of January, 1995. TAX REVIEW BOARD Harlan E. Boyles, Chairman State Treasurer Hugh Wells, Ex Officio Member Chairman Utilities Commission Jeff D. Batts, Appointed Member 9:22 NORTH CAROLINA REGISTER February 15, 1995 1885 IN ADDITION STATE OF NORTH CAROLINA BEFORE THE TAX REVIEW BOARD COUNTY OF WAKE IN THE MATTER OF: The Proposed Assessment of corporate income tax for the taxable years ended 30 ADMINISTRATIVE June 1988 and 30 June 1989 assessed DECISION NUMBER: 288 against J. W. Cook & Sons, Inc. THIS MATTER was heard before the Tax Review Board on 9 November 1994 in the City o Raleigh, Wake County, North Carolina. It involves an appeal by J. W. Cook & Sons, Inc., (hereinafte "Taxpayer") from the Final Decision of the Deputy Secretary of Revenue (hereinafter "Deputy Secretary" entered on 28 August 1992, sustaining a proposed assessment of corporate income tax for the taxable year ended 30 June 1988 and 30 June 1989. Chairman Harlan E. Boyles presided over the hearing with acting member, the Honorable Hug! Wells, Chairman, Utilities Commission and duly appointed member, Jeff D. Batts, Attorney at Law participating. William P. Pinna, Attorney at Law, appeared of behalf of the Taxpayer; Kay Linn Miller, Associate Attorney General, appeared on behalf of the Department of Revenue. AND IT APPEARING TO THE BOARD AS FOLLOWS: that the findings of fact made by the Deputy Secretary were supported by competent, material and substantial evidence in the record; that based upon the findings of fact, the Deputy Secretary's conclusions of law were fully supported by the findings of fact; therefore based upon the findings of fact and conclusions of law, the decision of the Deputy Secretary should be confirmed. IT IS THEREFORE ORDERED, that the Final Decision of the Deputy Secretary is confirmed in every respect. Entered this the 20th day of January, 1995. TAX REVIEW BOARD Harlan E. Boyles, Chairman State Treasurer Hugh Wells, Ex Officio Member Chairman Utilities Commission Jeff D. Batts, Appointed Member 1886 NORTH CAROLINA REGISTER February 15, 1995 9:22 IN ADDITION 5TATE OF NORTH CAROLINA COUNTY OF WAKE N THE MATTER OF: rhe Proposed Assessment of additional sales ind use tax for the period of January 1 , 1 986 hrough February 28, 1990 by the North Carolina Secretary of Revenue assessed against Robert L. Sutphen, d/b/a/ Southern Straw BEFORE THE TAX REVIEW BOARD ADMINISTRATIVE DECISION NUMBER: 289 THIS MATTER was heard before the Tax Review Board (hereinafter "Board") on 13 September 1994 n the City of Raleigh, Wake County, North Carolina. It involves an appeal by Robert L. Sutphen, d/b/a/ Southern Straw (hereinafter "Taxpayer") from the decision of the Michael A. Hannah, Assistant Secretary for Legal and Administrative Services (hereinafter "Assistant Secretary") entered on 21 March 1994 sustaining i proposed assessment of sales and use tax, plus penalties and interest, for the period of January 1, 1986 hrough February 28, 1990. Chairman Harlan E. Boyles presided over the hearing with acting member, the Honorable Hugh Wells, Chairman Utilities Commission and duly appointed member, Jeff D. Batts, Attorney at Law participating. Robert L. Sutphen appeared pro se; Kay Linn Miller, Associate Attorney General, appeared on behalf of the Department of Revenue. ISSUE Under G.S. § 105-241.2, the Tax Review Board is granted jurisdiction to hear appeals timely filed by a taxpayer regarding administrative review of the taxpayer's liability for the tax or additional tax assessed by the Secretary. The issue considered is: 1. Did the Taxpayer file a timely notice of intent to file a petition for review and a timely petition requesting review with the Tax Review Board? Under the guidelines of G.S. § 105-241. 2(a), the Taxpayer must take the following action in order to obtain administrative review: 1. Within 30 days after the Secretary's final decision is issued, file with the Tax Review Board, with a copy to the Secretary, notice of intent to file a petition for review. 2. Within 60 days after the Secretary's final decision is issued, file with the Tax Review Board, with a copy to the Secretary, a petition requesting administrative review and stating in concise terms the grounds upon which review is sought. THE TAX REVIEW BOARD CONSIDERED THE FOLLOWING FACTS AND DOCUMENTS FILED IN THIS MATTER: 9:22 NORTH CAROLINA REGISTER February 15, 1995 1887 IN ADDITION 1. On 21 March 1994, the Secretary's final decision was mailed to the Taxpayer. 2. On 19 May 1994, Taxpayer's attorney wrote the Board requesting review of the case. 3. On 26 May 1994, the Board's Executive Secretary acknowledged receipt of the 19 May 199* letter as an untimely notice of intent to file a petition for review. 4. On 16 August 1994, Taxpayer filed a letter with the Board setting forth his reasons foi requesting administrative review. BASED UPON THE FOREGOING FACTS, THE TAX REVIEW BOARD CONCLUDES AS A MATTER OF LAW: 1. The time limits specified in G.S. 105-241. 2(a) are jurisdictional in nature; the Board has no authority to consider petitions not filed within the time prescribed by law. 2. Because the Taxpayer did not file a petition within the time prescribed by 105-241. 2(a), the Taxpayer's appeal must be dismissed. IT IS THEREFORE ORDERED that the Taxpayer's appeal be, and is hereby, DISMISSED. Entered this 27th day of January, 1 995 . TAX REVIEW BOARD Harlan E. Boyles, Chairman State Treasurer Hugh Wells, Ex Officio Member Chairman Utilities Commission Jeff D. Batts, Appointed Member 1888 NORTH CAROLINA REGISTER February 15, 1995 9:22 IN ADDITION TITLE 7 - DEPARTMENT OF CULTURAL RESOURCES Notice is hereby given in accordance with G.S. 150B-21.2 that the Department of Cultural Re-sources, Division of State Library intends to amend rule cited as 7 NCAC 2E . 0301. 1 he proposed effective date of this action is May 1, 1995. Instructions on How to Demand a Public Hearing (must be requested in writing within 15 days of notice): A public hearing may be requested by sending a written request to Caroline Shepard, State Library of North Carolina, 109 E. Jones St., Raleigh, NC 27601-2807, fax (919) 733-8748. Reason for Proposed Action: This Rule change is being made to be more responsive to units of local government by formally adopting the special provision that was included in the Current Opera-tions Appropriations Act of 1993 (Senate Bill 27, Section 38). {comment Procedures: Comments may be submit-ted in writing to Caroline Shepard, State Library of North Carolina, 109 E. Jones St. , Raleigh, NC 27601-2807, fax (919) 733-8748. CHAPTER 2 - DIVISION OF STATE LIBRARY SUBCHAPTER 2E - LIBRARY DEVELOPMENT SERVICES SECTION .0300 - ALLOCATION OF STATE AID TO PUBLIC LIBRAREES 0301 QUALD7ICATIONS FOR GRANTS Libraries requesting funding from the aid to public libraries fund must meet the following requirements: (1) Be legally established as required by North Carolina statutes. (2) Provide library services easily available without discrimination to all residents of the political subdivision supporting the library. (3) Employ a director having a valid North Carolina public librarian certificate and successful experience as a public librarian (4) (5) or administrator. Secure operational funds from local government sources at least equal to the amount budgeted the previous year. A grant to a local library system from the Aid to Public Libraries Fund shall not be terminated but shall be reduced propor-tionately by the Department of Cultural Resources if the local funding for a pub-lic library was reduced by the local gov-erning body as part of an overall general budgetary reduction reflecting local eco-nomic conditions and local government fiscal constraints. State funds shall not replace local funds appropriated for public library operations. Expend funds as authorized in the adopt-ed budget. Any library having an unen-cumbered operational balance of more than 17 percent of the previous year's operating receipts will have the difference deducted from its state allocation. Obtain aggregate operational funds from local sources at least equaling state aid. Pay salaries for professional positions funded from state aid that are no less than the scale required by the Division of State Library. Obtain an annual audit of library ac-counts by a certified public accountant and submit a copy of this audit to the Division of State Library. Submit a copy of bylaws and personnel policies to the Division of State Library. Compile an assessment of the library needs of the community, prepare and annually revise a long-range plan of service, and submit copies of needs as-sessment and long-range plans of service to the Division of State Library. Submit a copy of the agreement establish-ing the regional or county library, if composed of more than one local govern-mental unit. Meet the following stipulations when establishing a new library or withdrawing from a larger system: qualify for state aid on the first day of the fiscal year, operate successfully during that year, apply for state aid after the year of successful operation. (6) (7) (8) (9) (10) (11) (12) (a) (b) (c) Statutory Authority G.S. 125-7; 143B-10. 9:22 NORTH CAROLINA REGISTER February 15, 1995 1889 PROPOSED RULES TITLE 10 - DEPARTMENT OF HUMAN RESOURCES Notice is hereby given in accordance with G.S. 150B-21.2 that the Division of Aging intends to amend rules cited as 10 NCAC 22J .0308; 22 R .0201 and .0202. 1 he proposed effective date of this action is May 1, 1995. 1 he public hearing will be conducted at 2:00 p.m. on March 3, 1995 at the Division of Aging, 693 Palmer Drive, Room 127, Raleigh, NC. Jxeasonfor Proposed Action: 10 NCAC 22] .0308 - Clarification of who may serve as in-home aides for the elderly. 10 NCAC 22R .0201 - .0202 - Clarification of boards of commissioners and area agencies on aging responsibilities through the Home and Community Care Block Grant for Older Adults. (comment Procedures: Written comments will be received by the Director of the Division of Aging through March 18, 1995. Verbal comments will be heard at the public hearing. CHAPTER 22 - AGING SUBCHAPTER 22J - IN-HOME AIDE SERVICES FOR OLDER ADULTS SECTION .0300 - SERVICE PROVISION .0308 SELECTION OF AIDES The following persons shall be allowed to serve as in home aides: W-m- Non re latives who are 4l8a-years-oetfiage or older who are qualified to perform tho tasks needed by the olient. Relatives of the client, who for this pur poso are parent, spouse, child or sibling, who are 18 years of age or older and who give up employment or tho opportu nity for employment in order to perform the — service and—whe — are qualified to perform the tasks needed by the olient. Note:—Persons who cannot serve as in home aides are those under 18 years of age ; those who are not qualified to perform the tasks needed by the olient; and those who are relatives of the client, who for this purpose are parent, spouse, ohild, or oiblinj who are unemployed or who do not have to giv up employment in order to provide tho oorvioor Agencies must have written policy regarding wh may serve as in-home aids. The written polic shall include, at a minimum, the following require ments about who may serve as in-home aides: (1) persons 18 years of age or older o emancipated minors; and (2) persons who are qualified to perform tb tasks needed by the client; and (3) whether or not the agency allows thi hiring of relatives to serve as the client' in-home aide. If the agency allows \ relative to be the client's in-home aide the policy must also address thj following requirements: fa) that relatives of the client. for thi: ill iiil liiil m £b) (4} purpose are either: a parent, spouse, child, or sibling of the client including stej relations of the client for any o: those; and that the relative must have given u employment or the opportunity foi employment in order to perform the tasks needed by the client; and any other hiring guidelines established by the agency. Statutory Authority 143B-181.9A. G.S. 1 43B-181.1(c) SUBCHAPTER 22R - HOME AND COMMUNITY CARE BLOCK GRANT FOR OLDER ADULTS SECTION .0200 - BASIS FOR GRANTING BLOCK GRANT FUNDS TO COUNTIES .0201 DEFINITIONS (a) "County Block Grant Advisory Committee" means a committee, appointed annually by the Board of County Commissioners, that represents a broad range of aging interest in the county. The committee serves to build local consensus for the County Funding Plan and to function as a resource for the County Lead Agency for Planning and Coordination by obtaining input from service provider interests, and older consumers and their families. A representative of the Area Agency on Aging shall be appointed to the committee when the Area Agency on Aging is not designated as the 1890 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES County Lead Agency for Planning and Coordination, as specified in K) NCAC 22R .0201(c). (b) "County Funding Plan" means the format developed by the Division of Aging in which counties identify the County Lead Agency for Planning and Coordination, service providers, services, and budgetary data for the provision of Home and Community Care Block Grant for Older Adults services in the county during the State Fiscal Year. (c) "County Lead Agency for Planning and Coordination" means a public or private non-private agency or office which is designated annually by the Board of County Commissioners for the purpose of developing the County Funding Plan for the provision of services through the Block Grant. County Funding Plan development responsibilities include directing the work of the County Block Grant Advisory Committee, facilitating a public hearing for the County Funding Plan prior to approval by submission to the Chairman of the Board of Commissioners, and ensuring that the approved County Funding Plan meets all requirements as specified by the Division of Aging prior to submission for approval to the Area Agency on Aging. Statutory Authority G. S. 143B-181.1(c). 143B-181.1(a)(ll); .0202 COUNTY FUNDING PLANS (a) The County Lead Agency for Planning and Coordination shall provide the County Budget Officer with a preliminary County Funding Plan which, at a minimum, specifies Home and Community Care Block Grant for Older Adults services, funding levels, and required local matching amounts by April 30 of each year. (b) Area Agencies on Aging shall grant Home and Community Care Block Grant for Older Adults funding to Counties on the basis of a the recommended County Funding Plan that has been approved submitted by the Chairman of the Board of Commissioners and submitted to the Area Agenoy on Aging . Area Agencies on Aging shall receive the County Funding Plan and, upon approval, shall grant funding to the County on the basis of the Plan. (c) The approved County Funding Plan., as approved by the Area Agency on Aging, shall be wholly a part of the Grant Agreement between the County and the Area Agency on Aging for the provision of aging services through the Home and Community Care Block Grant for Older Adults. Statutory Authority G.S. 143B-181.1(a)(ll); 143B-181.1(c). * * * ISotice is hereby given in accordance with G.S. 150B-21.2 that the DHR - Division of Medical Assistance intends to amend rules cited as 10 NCAC 26H .0102 and .0104. 1 he proposed effective date of this action is May 1, 1995. 1 he public hearing will be conducted at 1:30 p.m. on March 17, 1995 at the Division of Medi-cal Assistance, 1985 Umstead Drive, Room 132, Raleigh, N. C MXeason for Proposed Action: To end cost settle-ment for OSHA Bloodborne costs and to begin payment of non-ambulance medically necessary transportation cost. Lsomment Procedures: Written comments con-cerning this amendment must be submitted by March 1 7, 1995 to: Division of Medical Assis-tance, 1985 Umstead Drive, Raleigh, N.C., 27603, ATTN: Portia Rochelle, APA Coordinator. Oral comments may be presented at the hearing. In addition, a fiscal impact statement is available upon written request from the same address. CHAPTER 26 - MEDICAL ASSISTANCE SUBCHAPTER 26H - REIMBURSEMENT PLANS SECTION .0100 - REIMBURSEMENT FOR NURSING FACILITY SERVICES .0102 RATE SETTING METHODS (a) A rate for skilled nursing care and a rate for intermediate nursing care is determined annually for each facility to be effective for dates of service for a twelve month period beginning each October 1 . Each patient will be classified in one of the two categories depending on the services needed. Rates are derived from either filed, desk, or field audited cost reports for a base year period to be selected by the state. Rates developed from filed cost reports may be retroactively adjusted if there is found to exist more than a two percent differ- 9:22 NORTH CAROLINA REGISTER February 15, 1995 1891 PROPOSED RULES ence between the filed direct per diem cost and either the desk audited or field audited direct per diem cost for the same reporting period. Cost reports are filed and audited under provisions set forth in 10 NCAC 26H .0104. The minimum requirements of the 1987 OBRA are met by these provisions. (b) Each prospective rate consists of two compo-nents: a direct patient care rate and an indirect rate computed and applied as follows: (1) The direct rate is based on the Medic-aid cost per day incurred in the follow-ing cost centers: (A) Nursing, (B) Dietary or Food Service, (C) Laundry and Linen, (D) Housekeeping, (E) Patient Activities, (F) Social Services, (G) Ancillary Services (includes several cost centers). (2) To compute each facility's direct rate for skilled care and intermediate care, the direct base year cost per day is increased by adjustment factors for price changes as set forth in Rule .0102(c). (A) A facility's direct rates cannot exceed the maximum rates set for skilled nursing or intermediate nursing care. However, the Division of Medical Assistance may negotiate direct rates that exceed the maximum rate for ventilator dependent patients. Payment of such special direct rates shall be made only after specific prior approval of the Division of Medical Assistance. (B) A standard per diem amount will be added to each facility's direct rate, including facilities that are limited to the maximum rates, for the projected statewide average per diem costs of the salaries paid to replacement nurse aides for those aides in training and testing status and other costs deemed by HCFA to be facility costs related to nurse aide training and testing. The standard amount is based on the product of multiplying the average hourly wage, benefits, and payroll taxes of replacement nurse aides by the number of statewide hours required for training and testing of all aides divided by the projected total patient days. (3) If a facility did not report any costs foi either skilled or intermediate nursing care in the base year, the state average direct rate will be assigned as determined in Rule .0102(d) of thi Section for the new type of care. (4) The direct maximum rates are developed by ranking base-year per diem costs from the lowest to the highest in two separate arrays, one foi skilled care and one for intermediate care. Each array is weighted by total patient days. The per diem cost at the 80th percentile in each array is selected as the base for the maximum rate. The base cost in each array is adjusted foi price changes as set forth in Rule .0102(c) of this Section to determine the maximum statewide direct rates for skilled care and intermediate care. (5) Effective October 1, 1990, the direct rates will be adjusted as follows: (A) A standard per diem amount will be added to each facility's skilled ar.J intermediate rate to account for the combined expected average additional costs for the continuing education of nurses' aides; the residents' assessments, plans of care, and charting of nursing hours for each patient; personal laundry and hygiene items; and other non-nursing staffing requirements. The standard amount is equal to the sum of: (i) the state average annual salary, benefits, and payroll taxes for one registered nurse position multiplied by the number of facilities in the state and divided by the state total of patient days; (ii) the total costs of personal laundry and hygiene items divided by the total patient days as determined from the FY 1989 cost reports of a sample of nursing facilities multiplied by the annual adjustment factor described in Rule .0102(c)(4)(B) of this Section; and (iii) the state average additional pharmacy consultant costs divided by 365 days and then divided by the average number of beds per facility. 1892 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES (B) A standard amount will be added to the intermediate rate of facilities that were certified only for intermediate care prior to October 1, 1990. This amount will be added to account for the additional cost of providing eight hours of RN coverage and 24 hours of licensed nursing coverage. The standard amount is equal to the state average hourly wage, benefits and payroll taxes for a registered nurse multiplied by the 16 additional hours of required licensed nursing staff divided by the state average number of beds per nursing facility. A lower amount will be added to a facility only if it can be determined that the facility's intermediate rate prior to October 1, 1990 already includes licensed nursing coverage above eight hours per day. The add-on amount in such cases would be equal to the exact additional amount required to meet the licensed nursing requirements. (C) The standard amounts in Subparagraphs (2)(B), (5)(A), and (5)(B) of this Rule, will be retained in the rates of subsequent years until the year that the rates are derived from the actual cost incurred in the cost reporting year ending in 1991 which will reflect each facility's actual cost of complying with all OBRA '87 requirements. (6) Upon completion of any cost reporting year any funds received by a facility from the direct patient care rates which have not been spent on direct patient care costs as defined herein are repaid to the State. This will be applied by comparing a facility's total Medicaid direct costs with the combined direct rate payments received for skilled and intermediate care. Costs in excess of a facility's total prospective rate payments are not reimbursable. (7) The indirect rate is intended to cover the following costs of an efficiently and economically operated facility: (A) Administrative and General, (B) Operation of Plant and Maintenance, (C) Property Ownership and Use, (D) Mortgage Interest. (8) Effective for dates of service beginning October 1 , 1 984 and ending September 30, 1985 the indirect rates are fourteen dollars and sixty cents ($14.60) for each SNF day of care and thirteen dollars and fifty cents ($13.50) for each ICF day of care. These rates represent the first step in a two step transition process from the different SNF and ICF indirect rates paid in 1983-84 and the nearly equal indirect rates that will be paid in subsequent years under this plan as provided in this Rule. (9) Effective for dates of service beginning October 1, 1985 and annually thereafter per diem indirect rates will be computed as follows: (A) The average indirect payment to all facilities in the fiscal year ending September 30, 1983 [which is thirteen dollars and two cents ($13.02)] will be the base rate. (B) The base rate will be adjusted for estimated price level changes from fiscal year 1983 through the year in which the rates will apply in accordance with the procedure set forth in Rule .0102(c) of this Section to establish the ICF per diem indirect rate. (C) The ICF per diem indirect rate shall be multiplied by a factor of 1.02 to establish the SNF per diem indirect rate. This adjustment is made to recognize the additional administrative expense incurred in the provision of SNF patient care. (10) Effective for dates of service beginning October 1, 1989, a standard per diem amount will be added to provide for the additional administrative costs of preparing for and complying with all nursing home reform requirements. The standard amount is based on the average annual salary, benefits and payroll taxes of one clerical position multiplied by the number of facilities in the state divided by the state total of patient days. (11) Effective for dates of service beginning October 1, 1990, the indirect rate will be standard for skilled and intermediate care for all facilities and will be determined by applying the 1990-91 indirect cost adjustment factors in Rule .0102(c) of this Section to the indirect 1:22 NORTH CAROLINA REGISTER February 15, 1995 1893 PROPOSED RULES rate paid for SNF during the year beginning October 1, 1989. Thereafter the indirect rate will be adjusted annually by the indirect cost adjustment factors. (c) Adjustment factors for changes in the price level. The rate bases established in Rule .0102(b), are adjusted annually to reflect increases or decreases in prices that are expected to occur from the base year to the year in which the rate applies. The price level adjustment factors are computed using aggregate base year costs in the following manner: (1) Costs will be separated into direct and indirect cost categories. (2) Costs in each category will be accumulated into the following groups: (A) labor, (B) other, (C) fixed. (3) The relative weight of each cost group is calculated to the second decimal point by dividing the total costs of each group (labor, other, and fixed) by the total costs for each category (direct and indirect). (4) Price adjustment factors for each cost group will be established as follows: (A) Labor. The expected annual percentage change in direct labor costs as determined from a survey of nursing facilities to determine the average hourly wages for RNs, LPNs, and aides paid in the current year and projected for the rate year. The percentage change for indirect labor costs is based on the projected average hourly wage of N.C. service workers. (B) Other. The expected annual change in the implicit price deflator for the Gross National Product as provided by the North Carolina Office of State Budget and Management. (C) Fixed. No adjustment will be made for this category, thus making the factor zero. (D) The weights computed in (c)(3) of this Rule shall be multiplied times the percentage change computed in (c)(4)(A), (B) and (C) of this Rule. These products shall be added separately for the direct and indirect categories. (E) The sum computed for each category in (c)(4)(D) of this Rule shall be the price level adjustment factor for that category of rates (direct or indirect) for the coming fiscal year. (F) However, for the rate period beginning October 1, 1991 through September 30, 1992 the forecast of the N.C. Service Wages percent applied to the 1991-92 Inpatient Hospital and Intermediate Care Facility for the Mentally Retarded rates is applied to the Labor component weight computed in (c)(4)(A) of this Rule. (G) For the rate period beginning October 1, 1991 through September 30, 1992 the direct adjustment factor determined under (c)(4) of this Rule will be applied to the direct rate adjustments determined under (b)(2), (b)(5)(A) and (b)(5)(B) of this Rule (d) The skilled and intermediate direct patient care rates for new facilities are established at the lower of the projected costs in the provider's Certificate of Need application inflated to the current rate period or the average of industry base year costs and adjusted for price changes as set forth in Rule .0102(c) of this Section. A new facility receives the indirect rate in effect at the time the facility is enrolled in the Medicaid program. In the event of a change of ownership, the new owner receives the same rate of payment assigned to the previous owner. (e) Each out-of-state provider is reimbursed at the lower of the appropriate North Carolina maximum rate or the provider's payment rate as established by the State in which the provider is located. For patients with special needs who must be placed in specialized out-of-state facilities, a payment rate that exceeds the North Carolina maximum rate may be negotiated. (f) Specialized Service Rates: (1) Head Injury Intensive Rehabilitation Services. (A) A single all-inclusive prospective per diem rate combining both the direct and indirect cost components may be negotiated for nursing facilities that specialize in providing intensive rehabilitation services for head-injured patients. The rate may exceed the maximum rate applicable to other Nursing Facility services. A facility must specialize to the extent of staffing at least 50 percent of its 1894 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES Nursing Facility licensed beds for intensive head-injury rehabilitation services. The facility must also be accredited by the Commission for the Accreditation of Rehabilitation Facilities (CARF). (B) A facility's initial rate is negotiated based on budget projections of revenues, allowable costs, patient days, staffing and wages. A complete description of the facility's medical program must also be provided. Rates in subsequent years are determined by applying the average annual skilled nursing care adjustment factors to the rate in the previous year, unless either the provider or the State requests a renegotiation of the rate within 60 days of the rate notice. (C) Cost reports for this service must be filed in accordance with the rules in 10 NCAC 26H .0104, but there will be no cost settlements for any differences between cost and payments. Since it is appropriate to include all financial considerations in the negotiation of a rate, a provider will not be eligible to receive separate payments for return on equity as defined in 10 NCAC 26H .0105. (2) Ventilator Services. (A) Ventilator services approved for nursing facilities providing intensive services for ventilator dependent patients shall be reimbursed at higher direct rates as described in Subparagraph (b)(2)(A) of this Rule. Ventilator services shall be paid by combining the enhanced direct rate with the nursing facility indirect rate determined under Subparagraph (b)(ll)of this Rule. (B) A facility's initial direct rate shall be negotiated based on budget projections of revenues, allowable costs, patient days, staffing and wages. Rates in subsequent years shall be determined by applying the nursing facility direct adjustment factor to the previous 12 month cost report direct cost. (C) Cost reports and settlements for this service shall be in accordance with 10 NCAC 26H .0104 and return on equity is allowed as defined in 10 NCAC 26H .0105. (D) A single all-inclusive prospective per diem rate combining both the direct and indirect cost components may be negotiated for nursing facilities that specialize in providing intensive services for ventilator-dependent patients. The rate may exceed the maximum rate applicable to other Nursing Facility services. For ventilator services, the only facilities that shall be eligible for a combined single rate are small freestanding facilities with less than 21 Nursing Facility Beds and that serve only patients requiring ventilator services. Ventilator services provided in larger facilities shall be reimbursed at higher direct rates as described in Subparagraph (b)(2)(A) of this Rule. (g) In addition to the prospective direct per diem rates developed under this Section, effective July -h — 1992, an interim payment add on will be applied to the total rate to cover the estimated ooet required under Title 29, Part 1910, Subpart Z, Section—1910.1030 of the Code of Federal Regulations.—The interim rate will be subject to final settlement reconciliation with reasonable coot to meet the requirements of Part 1910. The final settlement reoonoiliation will be effectuated during the annual coot report settlement prooess.—An interim rate add on to the prospective rate will be allowed, subject to final settlement reoonoiliation, in subsequent rate periods until adequate cost history is available to include the cost of meeting the requirements of Part 1910 in the prospective rater Effective October J^ 1994 the bloodborne pathogen cost required under Title 29, Part 1910, Subpart 2^ Section 1910.0130 of the Code of Federal Regulations shall be included in the nursing facility's direct cost reimbursement. The initial per diem amount shall be set at the lower of the actual or eightieth percentile of bloodborne pathogen costs incurred in fiscal year 1993. (h) Religious Dietary Considerations. (1) A standard amount may be added to a nursing facility's skilled and intermediate care rates, that may exceed the maximum rates determined under Paragraph (b) of this Rule, for special dietary need for religious reasons. (2) Facilities must apply to receive this special payment consideration. In applying, facilities must document the reasons for special dietary consideration NORTH CAROLINA REGISTER February 15, 1995 1895 PROPOSED RULES for religious reasons and must submit documentation for the increased dietary costs for religious reasons. Facilities must apply for this special benefit each time rates are determined from a new data base. Fifty or more percent of the patients in total licensed beds must require religious dietary consideration in order for the facility to qualify for this special dietary rate add-on. (3) The special dietary add-on rate may not exceed more than a 30 percent increase in the average skilled and intermediate care dietary rates calculated for the 80th percentile of facilities determined under Subparagraph (b)(4) of this Rule and adjusted for annual inflation factors. This maximum add-on will be adjusted by the direct rate inflation factor each year until a new data base is used to determine rates. (4) This special dietary add-on rate will become part of the facility's direct rates to be reconciled in the annual cost report settlement. £i} Effective October J^ 1994 nursing facilities are responsible for providing medically necessary transportation for residents, unless ambulance transportation is needed. Reimbursement shall be included in the nursing facility's direct cost. The initial amount shall be based on a rjer diem fee derived from estimated industry cost for transportation and associated salaries. fj) This reimbursement limitation shall become effective in accordance with the provisions of G.S. 108A-55(c). Authority G.S. 108A-25(b); 108A-54; 108A-55; 29 C.F.R. 1910, Subpart Z; 42 C.F.R. 447, Subpart C. .0104 COST REPORTING: AUDITING AND SETTLEMENTS (a) Each facility that receives payments from the North Carolina Medicaid Program must prepare and submit a report of its costs and other financial information, such as the working trial balance, related to reimbursement annually. The report must include costs from the fiscal period beginning on October 1 and ending on September 30 and must be submitted to the state on or before the December 31 that immediately follows the September 30 year end. A new provider must submit a report for the period beginning with the date of certification and ending on September 30. Hospital based nursing facilities with a fiscal year ending other than September 30 and State operated facilities with a June fiscal year ending must file their cost reports within 90 days after their fiscal year ends. Facilities that fail to file their cost reports by the due date are subject to payment suspension until the reports are filed. The Division of Medical Assistance may extend the deadline 30 days for filing the report if, in its view, good cause exists for the delay. (b) Cost report format. The cost report must be submitted on forms and in a format and medium approved by the Division of Medical Assistance The account structure for the report is based on the chart of accounts published by the American Healthcare Association in 1979 but amended or modified to the extent necessary to meet the special reimbursement requirements of this plan. The Division of Medical Assistance will make one copy of the cost report format available to each facility (combination facilities receive only one) on or before July 1 of the reporting year for which the report is to be filed. (c) Cost finding and allocation. Costs must be reported in the cost report in accordance with the following rules and in the order of priority stated. (1) Costs must be reported in accordance with the specific provisions of this plan as set forth in this Rule. (2) Costs must be reported in conformance with the Medicare Provider Reimbursement Manual, HCEA 15. (3) Costs must be reported in conformance with Generally Accepted Accounting Principles. (d) The specific cost reporting guidelines related to this plan are set forth in the following Paragraphs. The state will publish guidelines, consistent with the provisions of this plan, concerning the proper accounting treatment for items described in this Rule as related operating expenses. The guidelines may be modified prior to the beginning of each cost reporting period. In no case, however, shall any modifications be applied retroactively. A provider should request clarification in writing from the state if there is uncertainty about the proper cost center classification of any particular expense item. (1) Nursing Cost Center includes the cost of nursing staff, medical supplies, and related operating expenses needed to provide nursing care to patients, including medical records (including forms), utilization review, the Medical Director and the Pharmacy Consultant. 1896 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES The amount of nursing time provided to each patient must be recorded in order to allocate nursing cost between skilled and intermediate nursing care. (2) Dietary Cost Center includes the cost of staff, raw food, and supplies needed to prepare and deliver food to patients. (3) Laundry and Linen Cost Center includes the cost of staff, bed linens (replacement mattresses and related operating expenses needed to launder facility-provided items). (4) Housekeeping Cost Center includes the cost of staff and supplies needed to keep the facility clean. (5) Patient Activities Cost Center includes the cost of staff, supplies, and related operating expenses needed to provide appropriate diversionary activities for patients. (6) Social Services includes the cost of social workers and related operating expenses needed to provide necessary social services to patients. (7) Ancillary Cost Center includes the cost of all therapy services covered by the Medicaid program and billable medical supplies. Providers must bill Medicare Part B for those ancillary services covered under the Medicare Part B program. Ancillary cost centers include: Radiology, Laboratory, Physical Therapy, Occupational Therapy, Speech Therapy, Oxygen Therapy, Intravenous Fluids, Billable Medical Supplies, Parenteral/Enteral Therapy and life sustaining equipment, such as oxygen concentrators, respirators, and ventilators and other specifically approved equipment. (A) Effective October 1^ 1994, a separate ancillary cost center shall be established to include costs associated with medically related transportation for facility residents. Medically related transportation costs include the costs of vehicles leased or owned by the facility, payroll costs associated with transporting residents and payments to third parties for providing these services. (8) Administrative and General Cost Center includes all costs needed to administer the facility including the staff costs for the administrator, assistants, billing and secretarial personnel, personnel director and pastoral expenses. It includes the costs of copy machines, dues and subscriptions, transportation, income taxes, legal and accounting fees, start-up, and a variety of other administrative costs as set forth in the Chart of Accounts. Interest expense other than that stemming from mortgages or loans to acquire physical plant items shall be reported here. (9) Property Ownership and Use: (A) This cost center includes all allowable costs related to the acquisition and/or use of the physical assets including building, fixed equipment and movable equipment, that are required to deliver patient care, except the special equipment, as specified in .0104(d)(7) of this Rule that may be charged to the life-sustaining equipment cost center. Specifically it includes the following items: (i) all equipment expense regardless of equipment nature, (ii) lease expense for all physical assets, (iii) depreciation of assets utilizing the straight line method, (iv) interest expense of asset related liabilities, (e.g., mortgage expense), (v) property taxes. (B) For the purposes of computing allowable lease expense and for balance sheet presentation for Return on Equity computations (see Rule .0105), leases shall not be capitalized. (C) In establishing the allowable cost for depreciation and for interest on capital indebtedness, with respect to an asset which has undergone a change of ownership, the valuation of the asset shall be the lesser of allowable acquisition cost less accumulated depreciation to the first owner of record on or after July 18, 1984 or the acquisition cost to the new owner. Depreciation recapture will not be performed at sale. The method for establishing the allowable related capital indebtedness shall be as follows: (i) The allowable asset value shall be divided by the actual acquisition NORTH CAROLINA REGISTER February 15, 1995 1897 PROPOSED RULES cost, (ii) The product computed in step 1 shall be multiplied times the value of any related capital indebtedness, (iii) The result shall be the liability amount upon which interest may be recorded at the rate set forth in the debt instrument or such lower rate as the state may prove is reasonable. The allowable asset and liability values established through the process in this Rule shall be those used in balance sheet presentations for return on equity computation (see Rule .0105). These procedures are established to implement the provisions of PL 98-369 Section 2314. (10) Operation of Plant and Maintenance Cost Center includes all costs necessary to operate or maintain the functionality and appearance of the plant. These include: maintenance staff, utilities, repairs and maintenance to all equipment. (11) Equipment Expense. Equipment is defined as an item with a useful life of more than two years and a value greater than five hundred dollars ($500.00). Equipment ownership and use costs shall be reported in the Property Ownership and Use Cost Center. Equipment maintenance and repair costs shall be reported in the Operation of Plant and Maintenance Cost Center. Equipment shall not be reported elsewhere. (12) Training Expense. Training expense must be identified in the appropriate benefiting cost center. The costs of training nurse aides must be identified separately and may include the cost of purchasing programs and equipment that have been approved by the State for training or testing. (13) Home Office Costs. Home office costs are generally charged to the Administrative and General Cost Centers. In some cases, however, certain personnel costs which are direct patient care oriented may be allocated to "direct" patient care cost centers if time records are maintained to document the performance of direct patient care services. No Home office overhead may be so allocated. The basis of this allocation among facilities participating in the North Carolina Medicaid program may be: (A) specific time records of work performed at each facility, or (B) patient days in each facility to which the costs apply relative to the total patient days in all the facilities to which the costs apply. (14) Management Fees. Management fees are charged to the Administrative and General Cost Center. In some cases, however, a portion of a management fee may be allocated to a direct patient care cost center if time records are maintained to document the performance of direct patient care services. The amount so allocated may be equal only to the salary and fringe benefits of persons who are performing direct patient care services while employed by the management company. Adequate records to support these costs must be made available to staff of the Division of Medical Assistance. The basis of this allocation among facilities participating in the North Carolina Medicaid program may be: (A) specific time records of work performed at each facility, or (B) patient days in each facility to which the costs apply relative to the total patient days in all the facilities to which the costs apply. (15) Related Organization Costs. It is the nursing facility's responsibility to demonstrate by convincing evidence to the satisfaction of the Division of Medical Assistance that the costs are reasonable. Reasonable costs of related organizations are to be identified in accordance with direct and indirect cost center categories as follows: (A) Direct Cost: (i) Compensation of direct care staff such as nursing personnel (aides, orderlies, nurses), food service workers, housekeeping staff and other personnel who would normally be accounted for in a direct cost center, (ii) Supplies and services that would 1898 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES normally be accounted for in a direct cost center, (iii) Capital, rental, maintenance, supplies/repairs and utility costs (gas, water, fuel, electricity) for facilities that are not typically a part of a nursing facility. These facilities might include such items as warehouses, vehicles for deliv-ery and offices which are totally dedicated or clearly exceed the number, size, or complexity required for a normal nursing facility, its home office, or man-agement company, (iv) Compensation of all adminis-trative staff who perform no duties which are related to the nursing facility or its home office and who are neither officers nor owners of the nursing facilities or its home office. (B) Indirect Cost: (i) Capital, rental, maintenance, supplies/repairs, and utility costs which are normally or frequently a part of a nursing facility. This would include, for example, kitchen and laundry facilities, (ii) Home office costs except for salary and fringe benefits of Per-sonnel, Accounting and Data Processing staff which are allocat-ed by acceptable methods are direct costs when the work per-formed is specific to the related organization that provides a direct care service or product to the provider, (iii) Compensation of all administra-tive staff who perform any duties for the nursing facility or its home office, (iv) All compensation of all officers and owners of the nursing facility or its home office, or parent corporation. The related organization must file a Medicaid Cost Statement (DMA-4083) identifying their osts, adjustments to costs, allocation of costs, equity capital, adjustments to equity capital, and ^locations of equity capital along with the nursing facilities cost report. A home office, or parent ompany, will be recognized as a related organiza- :ion. Auditable records to support these costs must be made available to staff of the Division of Medical Assistance and its designated contract auditors. Undocumented costs will be disallowed. It is the nursing facility's responsibility to demon-strate by convincing evidence to the satisfaction of the Division of Medical Assistance that the criteria in the Provider Reimbursement Manual, Section 1010, has been met in order to be recognized as an exception to the related organization principle. When a related organization is deemed an excep-tion; reasonable charges by the related organiza-tion to the nursing facility are recognized as allowable costs; receivable/payables from/to the nursing facility and related organization deemed an exception are not adjusted from the nursing facility's balance sheet in computing equity capital. (e) Auditing and Settlement. All filed cost reports must be desk audited and interim reimbursement settlements made in accordance with the provision of this plan. This settlement is issued within 1 80 days of the date the cost report was filed or within 180 days of December 31 of the fiscal year to which the report applies, whichever is later. The state may elect to perform field audits on any filed cost reports within three years of the date of filing and issue a final settlement on a time schedule that conforms to Federal law and regulation. If the state decides not to field audit a facility a final reimbursement notice may be issued based on the desk audited settlement. The state may reopen and field audit any cost report after the final settlement notice to comply with Federal law and regulation or to enforce laws and regulations prohibiting abuse of the Medicaid Program and particularly the provisions of this reimbursement plan. (f) This reimbursement limitation shall become effective in accordance with the provisions of G.S. 108A-55(c). Authority G.S. W8A-25(b); 108A-54; 108A-55; 42 C.F.R. 447, Subpart C. TITLE 15A - DEPARTMENT OF ENVIRONMENT, HEALTH, AND NATURAL RESOURCES CHAPTER 2 - ENVIRONMENTAL MANAGEMENT COMMISSION The Environmental Management Commis-sion is extending the public comment period from February 20, 1995 to March 20, 1995 for the proposed rule modifications in Subchapter 2B .0100, 2B .0200 and 2H .0500, governing issuance 9:22 NORTH CAROLINA REGISTER February 15, 1995 1899 PROPOSED RULES of 401 Water Quality Certifications and water quality standards for wetlands. Because of the significant public interest in the proposed rules, the record will remain open until March 20th to allow additional written comments received after Febru-ary 20th to become part of the official record. The proposed rule changes were published in the North Carolina Register, Volume 9, Issue 17, pages 1348-1367 (9:17 NCR 1348-1367). The proposed rules affected are cited as 15A NCAC 2B .0101, .0103, .0109, .0201, .0202, .0220, and 15A NCAC 2H .0501, .0502, .0503, .0504, .0506, and .0507. The Division will accept written comments received through March 20, 1995. For information on the proposed rule changes or the comment period extension, contact Ron Ferrell, North Carolina Division of Environ-mental Management, RO. Box 29535, Raleigh, NC 27606-0535, (919-733-0026). The Division of Environmental Manage-ment is extending the public comment period from January 16, 1995, until March 1, 1995, for the proposed rules defining potential emissions for various types of sources. These rules were pub-lished on November 15, 1994 in the North Caroli-na Register, Volume 9, Issue 16, pages 1261-1283 (9:16 NCR 1261-1283). The proposed rules are cited as 15A NCAC 2Q .0801 -.0807. All persons interested in these matters are invited to submit written comments. The Division will accept written comments through Wednesday, March 1st for inclusion in the hearing record. Comments should be sent to and additional information concerning the proposals may be obtained by contacting: Mr. Thomas Allen Division of Environmental Management P.O. Box 29535 Raleigh, North Carolina 27626-0535 (919) 733-1489 (Phone) (919) 733-1812 (Fax) Notice is hereby given in accordance with G.S. 150B-21.2 that the N. C. Wildlife Resources Com-mission intends to amend rules cited as 15A NCAC WB .0106 and 10F .0354. 1 he proposed effective date of this action is July 1, 1995. 1 he public hearing will be conducted at 10:0 a.m. on March 6, 1995 at the Archdale Building Room 332, 512 N. Salisbury Street, Raleigh, N 27604. Ixeason for Proposed Action: ISA NCAC 10B .0106 - To establish requirement and procedures for wildlife damage control agenti To establish requirements and procedures fo mounting by taxidermists of wildlife and bin accidentally killed by automobile. 15A NCAC 10F .0354 - To regulate boat speed i congested area. Lsomment Procedures: Interested persons ma present their views either orally or in writing the hearing. In addition, the record of hearin will be open for receipt of written comments froi February 15, 1995 through March 17, 1995. Sue written comments must be delivered or mailed t the N. C. Wildlife Resources Commission, 512 P Salisbury Street, Raleigh, N C. 27604-1188. CHAPTER 10 - WILDLIFE RESOURCES AND WATER SAFETY SUBCHAPTER 10B - HUNTING AND TRAPPING SECTION .0100 - GENERAL REGULATIONS .0106 WILDLIFE TAKEN FOR DEPREDATIONS OR ACCIDENTALLY (a) Depredation Permit: (1) Endangered or Threatened Species. N permit shall be issued to take any ei dangered or threatened species of wil< life listed under 15A NCAC 101 reason of depredations to property. A individual may take an endangered threatened species in immediate defens of his own life or of the lives of othe without a permit. Any endangered c threatened species which may constitu a demonstrable but non-immedia threat to human safety shall be reporte to a federal or state wildlife enforo ment officer, who, upon verification < the report, may take or remove tl 1900 NORTH CAROLINA REGISTER February 15, 1995 9:2 PROPOSED RULES specimen as provided by 15A NCAC 101 .0002. (2) Other Wildlife Species. Except as provided in Subparagraph (1) of this Paragraph, the Executive Director or an agent of the Wildlife Resources Com-mission may, upon application of a landholder and after such investigation of the circumstances as he may require, issue a permit to such landholder to take any species of wildlife which is or has been damaging or destroying his property provided there is evidence of substantial property damage. No per-mit may be issued for the taking of any migratory birds and other federally protected animals unless a correspond-ing valid U.S. Fish and Wildlife Ser-vice depredation permit has been is-sued. The permit shall name the spe-cies allowed to be taken and, in the discretion of the Executive Director or an agent, may contain limitations as to age, sex or any other condition within the species so named. The permit may be used only by the landholder or an-other person named on the permit. ,exoept that, upon written requeot of th e landholder and when it is conclusively determined on the basis of information oubmitted by him that ho io incapable of aooompliohing—the — necessary—oontrol without help, the nameo of additional persons may be entered upon the permit by the Executive Director as authorized users. (3) Wildlife Damage Control Agents: Upon satisfactory completion of a Wildlife Resources Commission ap-proved training and satisfactory demon-stration of a knowledge of wildlife laws and safe, humane wildlife handling techniques, an individual may apply to the Wildlife Resources Commission (Commission) to become a Wildlife Damage Control Agent (WDCA). Those persons approved as agents by the Commission may then issue depre-dation permits to landholders and list themselves as a second party to provide the control service. WDCAs may not issue depredation permits for big game animals, bats, or species listed as en-dangered, threatened or special concern under Rules 101 .0003, .0004 and .0005 of this Chapter. WDCAs must report to the Wildlife Resources Com-mission the number and disposition of animals taken, by county, annually. Records must be available for inspec-tion by a Wildlife Enforcement officer at any time during normal business hours. WDCA status may be revoked at any time by the Executive Director when there is evidence of violations of wildlife laws, failure to report, or inhumane treatment of animals by the WDCA. WDCAs may not charge for the permit, but may charge for their investigations and control services. In order to maintain a knowledge of cur-rent laws, rules, and techniques. WDCA's must renew their agent status every three years by showing proof on having attended at least one Wildlife Commission approved training course provided for the purpose of reviewing and updating information on wildlife laws and safe, humane wildlife handling techniques within the previous 12 months. (b) Term of Permit. Each depredation permit issued by the Executive Director or an agent shall have entered thereon a date or time of expiration after which date or time the same shall become invalid for any purpose, except as evidence of lawful possession of any wildlife that may be retained thereunder. (c) Manner of Taking: (1) Taking Without a Permit. Wildlife taken without a permit while committing depredations to property may, during the open season on the species, be taken by the landholder by any lawful method. During the closed season such depredating wildlife may be taken without a permit only by the use of firearms. (2) Taking With a Permit. Wildlife taken under a depredation permit may be taken only by the method or methods specifically authorized by the permit. The—esly — methods—that—may—be authorized in talcing game species, other than foxes, io by the use of firearms and—live — traps. The — permit—may authorize th« taking ef- foxes, furbearing—animals,—and — nongame animals or birds by the uso of firearms or traps, including steel traps. When 9:22 NORTH CAROLINA REGISTER February 15, 1995 1901 PROPOSED RULES trapping is authorized, in order to limit the taking to the intended purpose, the permit may specify a reasonable distance from the property sought to be protected, according to the particular circumstances, within which the traps must be set. The Executive Director or agent may also state in a permit authorizing trapping whether or not bait may be used and the type of bait, if any, that is authorized. In addition to any trapping restrictions that may be contained in the permit the method of trapping must be in accordance with the requirements and restrictions imposed by G.S. 1 13-291 .6 and other local laws passed by the General Assembly . No depredation permit shall authorize the use of poisons or pesticides in taking wildlife except in accordance with the provisions of the North Carolina Pesticide Law of 1971, the Structural Pest Control Act of 1955, and Article 22A of Chapter 113 of the General Statutes of North Carolina. No depredation permit shall authorize the taking of wildlife by any method by any landholder upon the lands of another. (3) Intentional Wounding. It is unlawful for any landholder, with or without a depredation permit, intentionally to wound a wild animal in a manner so as not to cause its immediate death as suddenly and humanely as the circumstances permit. (d) Disposition of Wildlife Taken: (1) Generally. Except as provided by the succeeding Subparagraphs of this Paragraph, any wildlife killed accidentallyT or without a permit while committing depredations , or under a depredation permiH shall be buried or otherwise disposed of in a safe and sanitary manner on the property, where the depredations took place, of the landholder in whose name the permit-is issued or who kills suoh wildlife while committing—depredations. Wildlife killed under a depredation permit may be transported to an alternate disposal site if desired. Anyone in possession of carcasses of animals being transported under a depredation permit must have the depredation permit in their possession. Except as provided by the (2) (3) succeeding Subparagraphs of (d)(2) through (6) of this Rule, all wildlife killed under a depredation permit must be buried or otherwise disposed of in a safe and sanitary manner. Deer. Any landholder who lullo a doc* under—a currently—valid—deprodatioB permit for deer must report ouoh kill The edible portions of up to five deer may be retained by the landholder for consumption but must not be transported from the property where the depredations took place without a valid depredation permit. An enforcement officer, within 24 hours and beforo the doer is butohered for consumption to a wildlife enforcement officer, who upon determining that th e kill wao lawfully made within the scope of th e permit -aad if so requested by the permittee, shall provide the permittee a written authorization for his own private uoo or the use by a charitable organization of the edible portions of the carcass. The nonedible portions of the carcass, including head, hide, feet, and antlers shall be disposed of as specified in Subparagraph (1) of this Paragraph or turned over to a wildlife enforcement officer for disposition. When a deer is accidentally killed on a road or highway by reason of collision with a motor vehicle, the law enforcement officer who investigates the accident shall upon request of the operator of the vehicle, provide such operator a written permit authorizing him to possess and transport the carcass of such deer for his personal and lawful use, including delivery of such carcass to a second person for his private use or the use by a charitable organization upon endorsement of such permit to such person or organization by name and when no money or other consideration of value is received for such delivery or endorsement. Fox. Any fox killed accidentally by a dog or dogs, motor vehicle, or otherwise shall be disposed of as provided by Subparagraph (1) of this Paragraph. Any fox killed under a depredation permit may be disposed of in the same manner or, upon compliance with the fur tagging 1902 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES requirements of 15A NCAC 10B .0400, the carcass or pelt thereof may be sold to a licensed fur dealer. Any live fox taken under a depredation permit may be sold to a licensed controlled hunting preserve for fox in accordance with G.S. 113-273(g). (4) Furbearing Animals. The carcass or pelt of any furbearing animal killed during the open season for taking such furbearing animal either accidentally or for control of depredations to property, whether with or without a permit, may be sold to a licensed fur dealer provided that the person offering such carcass or pelt for sale has a valid hunting or trapping license, provided further that, bobcats and otters may only be sold upon compliance with any required fur tagging requirement set forth in 15A NCAC 10B .0400. (5) Animals Taken Alive. Wild animals in the order garnivora and beaver shall be humanely euthanized either at the site of capture or at an appropriate facility designed to humanely handle the euthanasia or released on the property where captured. Animals transported or held for euthanasia must be euthanized within 12 hours of capture. Anyone in possession of live animals being transported for relocation or euthanasia under a depredation permit must have the depredation permit in their possession. (5) Nongame Animals aed Birds. Nongame — animals—e?—birds—killed accidentally er fef control ef depredations—may be disposed of as provided by Subparagraph (1) of this Paragraph or in any other safe and sanitary manner. (6) A person killing a wild bird or wild animal accidentally with a motor vehicle or finding a dead wild bird or wild animal which was killed accidentally may possess that wild bird or wild animal for a period not to exceed 10 days for the purpose of delivering it to a licensed taxidermist for preparation. The licensed taxidermist may accept the wild bird or wild animal after satisfying himself that the animal was killed accidentally. The taxidermist shall certify and record the circumstances determined by of acquisition as his injury. Licensed taxidermists shall keep accurate records of each wildlife specimen received pursuant to the Rule as required by Rule 10H .1003 of this Chapter. Upon delivery of the finished taxidermy product to the person presenting the animal, the taxidermist shall give the person a receipt in the form required by the Wildlife Resources Commission indicating the species, date of delivery, circumstances of initial acquisition and any other information that may be required on the form. A copy of this receipt shall be filed with the Wildlife Resources Commission within 10 days of the date of delivery of the mounted specimen. The receipt shall serve as the non-transferable permit for continued possession of the mounted specimen and shall be retained by the person for as long as the mounted specimen is kept. Mounted specimens possessed pursuant to this Rule may not be sold and, if such specimens are transferred by gift or inheritance, the new owner must apply for a new permit and must submit the written receipt originally obtained from the taxidermist to document the legality of possession. This provision does not allow possession of accidentally killed raptors; migratory birds; species listed as endangered, threatened, or of special concern under Rules 101 .0003, .0004, and .0005 of this Chapter; bear or wild turkey. (e) Reporting Requirements. Any landholder who kills a deer, bear or wild turkey under a currently valid depredation permit shall report such kill on the form provided with the permit and mail the form immediately upon the expiration date to the Wildlife Resources Commission. The killing and method of disposition of ever)' game animal and game bird, every furbearing animal, and every nongame animal or nongame bird for which there is no open season, when killed for committing depredations to property, either with or without a permit, shall be reported to the Wildlife Resources Commission within 24 hours following th e time of such lulling, except that when th e carcass or pelt of a fox, kill ed under a depredation permit, or of a furbearing animal, killed with or without a permit, is lawfully sold to a lice nsed fur dealer in NORTH CAROLINA REGISTER February 15, 1995 1903 PROPOSED RULES thin State tho fur dealer is required to report the souroe of acquisition and no report is required of the seller. Statutory Authority G.S. 113-134; 113-273; 113-274; 113-291.4; 113-291.6; 113-300.1; 113-300.2; 113-307; 113-331; 113-333; 113-334(a); 113-337. SUBCHAPTER 10F - MOTORBOATS AND WATER SAFETY SECTION .0300 - LOCAL WATER SAFETY REGULATIONS .0354 PITT COUNTY (a) Regulated Areas. This Rule applies to the waters described in this Paragraph: (1) The entire inlet of Hardee Creek from the Tar River in Pitt County. (2) That portion of the Tar River beginniflg at the curve approaohing Seine Beach to the East side of the Grimesland Bridge as marked at each end by appropriate markers. The Seine Beach area of the Tar River beginning at Chicod Creek and extending to the east side of the Grimesland Bridge as marked by appropriate markers. (b) Speed Limit. No person shall operate a motorboat or vessel at greater than no-wake speed within the regulated areas described in Paragraph (a) of this Rule. (c) Placement and Maintenance of Markers. The Board of Commissioners of Pitt County is designated a suitable agency for placement and maintenance of markers implementing this Rule. Statutory Authority G.S. 75A-3; 75A-15. TITLE 18 - SECRETARY OF STATE iSotice is hereby given in accordance with G.S. 150B-21.2 that the N. C. Department of the Secre-tary of State intends to amend rules cited as 18 NCAC6 .1201 and .1210. 1 he proposed effective date of this action is May 1. 1995. 1 he public hearing will be conducted at 10:00 a.m. on March 2, 1995 at the Legislative Office Building, 300 N. Salisbury St. , Suite 100, Confer-ence Room, Raleigh, NC 27603. Ixeason for Proposed Action: To facilitate greater investment opportunities for North Carolina inves-tors. Lsomment Procedures: Interested persons may present oral or written statements at the public hearing, or in writing prior to the hearing by mail addressed to Mr. Gene Cella, Administrator, Securities Division, N. C. Dept. of the Secretary of State, 300 N. Salisbury St. , Raleigh, NC 27603. For copies of any information relating to the hearing call (919) 733-3924, or write to the aforementioned address. The comment period will end on March 17, 1995. CHAPTER 6 - SECURITIES DIVISION SECTION .1200 - EXEMPTIONS .1201 DESIGNATED SECURTTTES EXCHANGES The national securities exchanges designated by the administrator for the purposes of G.S. 78A-16(8) shall be: (1) New York Stock Exchange, (2) American Stock Exchange, (3) Midwest Stock Exchange, (4) Pacific Stock Exchange^ (5) Philadelphia Stock Exchange. Statutory Authority G.S. 78A-16(8). .1210 SECURITIES EXCHGS/AUTO QUOTATION SYS APPROVED/ ADMINISTRATOR For purposes of G.S. 78A-16(15), the following securities exchanges and automated quotation systems are approved provided such exchanges or systems comply with the provisions of Paragraphs (1) through (4) of the Memorandum of Understanding regarding a Model Uniform Marketplace Exemption From State Securities Registration Requirements [SEC Release 33-6810 (December 16, 1988), CCH NASAA Reports, par. 11,120] or the Memorandum of Understanding between The North American Securities Administrators Association, Inc. and The Philadelphia Stock Exchange, Inc., incorporated herein by reference. The incorporated material may be obtained, free of charge, from the North Carolina Secretary of State, Securities Division, 1904 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES 30 North Salisbury Street, Suite 100, Raleigh, orth Carolina 27603-5909 : (1) New York Stock Exchange, (2) American Stock Exchange, (3) Pacific Stock Exchange, (4) Midwest Stock Exchange, (5) NASDAQ National Market System, and (6) Chicago Board Options Exchange^ and (7) Philadelphia Stock Exchange. tatutory Authority G.S. 78A-16(15); 150B-21.6. TITLE 21 - OCCUPATIONAL LICENSING BOARD :HAPTER 2 - BOARD OF ARCHITECTURE Sotice is hereby given in accordance with G.S. 50B-21.2 that the North Carolina Board of rchitecture intends to amend rules cited as 21 1CAC 2 .0101, .0108, .0201 - .0202, .0204 - 1206, .0208 - .0210, .0212, .0215 - .0216, .0302 .0303, .0402, .0405, .0603; adopt 21 NCAC 2 0218 - .0219; repeal 21 NCAC 2 .0103 - .0105, 9207 and .0602. p he proposed effective date of this action is June , 1995. n he public hearing will be conducted at 9:00 m. on March 22, 1995 at the Methodist Build-ig, 1307 Glenwood Avenue, Raleigh, NC 27605. xeason for Proposed Action: 1 NCAC 2 .0101 - Need to relocate office. 1 NCAC 2 .0103 - Rule is duplicative of statute. G.S. 83A-2) I NCAC 2 .0104 - Rule is duplicative of statute. G.S. 83A-5) '1 NCAC 2 .0105 - Rule is duplicative of statute. G.S. 83A-14) \1 NCAC 2 .0108 - Sets out current applicable ees for Board services. M NCAC 2 .0201 - Sets out requirements for vritten notice offirm or address changes. \1 NCAC 2 .0202 - Requires licensees to affirm hey have read current architectural laws and Tiles. II NCAC 2 .0204 - Provides for inclusion of imited liability companies and partnerships in llowable forms ofpractice. U NCAC 2 .0205 - Provides language to include limited liability companies and partnerships. 21 NCAC 2 . 0206 - Clarifies the requirements and guidelines for use of the architectural seal. 21 NCAC 2 .0207 - Rule is duplicative of statute. (G.S. 83A-15) 21 NCAC 2 .0208 - Defines dishonest conduct. 21 NCAC 2 .0209 - Defines unprofessional con-duct. 21 NCAC 2 . 0210 - Defines incompetent conduct. 21 NCAC 2 .0212 - Defines certain types of conflicts of interest. 21 NCAC 2 .0215 - Prohibits foreign corporations from evading registration requirements by practic-ing through an individual license. 21 NCAC 2 .0216 - Requires a limited liability partnership to annually submit a list of partners. 21 NCAC 2 .0218 - Establishes the requirements necessary to practice as a limited liability compa-ny. 21 NCAC 2 .0219 - Establishes the requirements necessary to practice as a limited liability partner-ship. 21 NCAC 2 .0302 - Clarifies and extends the opportunity for exam applicants qualified under prior rules to sit for the exam. 21 NCAC 2 .0303 - Provides for alternative means of obtaining reciprocal registration. 21 NCAC 2 .0402 - Change Statutory reference within Rule. 21 NCAC 2 .0405 - Removes language stating a requirement already covered by statute. 21 NCAC 2 .0602 - Rule is duplicative of statute. 21 NCAC 2 .0603 - Clarifies who may request a hearing. Lsomment Procedures: Any person interested in these rules may present oral comments relevant to the action proposed at the public rule-making hearing or deliver written comments to the Board office not later than Wednesday, March 22, 1995. Anyone planning to attend the hearing should notify the Board office by noon Friday, March 17, 1995 whether they wish to speak on the proposals. Speakers will be limited to 5 minutes. SECTION .0100 - GENERAL PROVISIONS .0101 AUTHORITY: NAME AND LOCATION OF BOARD The "North Carolina Board of Architecture," subsequently herein referred to as the "Board," is established and authorized by Chapter 83A of the General Statutes of North Carolina. Unless other-wise directed, all communications should be h22 NORTH CAROLINA REGISTER February 15, 1995 1905 PROPOSED RULES addressed to the Board at 501 North Blount Street, Raleigh, North Carolina 27604 127 West Hargett Street, Suite 304, Raleigh, North Carolina 27601 . Statutory Authority G.S. 83A-2; 83A-6. .0103 DUTIES OF OFFICERS (a) President.—The president ohall, when pre s ent, preside at all meetings, appoint all oommit teos , sign all certificates issued and perform all other duties pertaining to his office . {&) — Vice Pres ident.—The vice president, in th e absence of the president, shall perform ail of th e duties of the president. (o) Seoretary,—The secretary, with th e assistance of an executive director, shall: (4^ conduct and care for all th e oorrespon denoe of th e Board, keep th e minutes of all the meetings, keep all books and records, and shall also sign all certifi eatos issued; {3} have charge, oare and custody of the official—documents—by — order—ef-—the Board; {£) provide — due notice—of the time and place of all meetings of the Board to each member of the Board; f4) keep a record of the proceedings of th e Board and registration for all applicants for registration and admission to prao tice architecture, giving the name and looation of the institution or place of training where the applicant was pre pared for the practice of architecture, and such other information as the Board may deem proper and useful. This registration shall be prima facie evi denoe of all matters recorded therein; {&) mail a copy of "Chapter 83A Archi tects" of th e North Carolina General Statutes and the rules of the Board to each architect licensed with the Board. (d) Treasurer.—With the assistance of an exeou tive director, th e treasurer shall: <4^ receive -aelHl- monies from architect fef annual renewal or other fees and depos it them in an authorized depository of the Board; (3) give bond in such sums as the Board shall determine, with suoh security as shall be approved by th e Board, said bond to be conditioned on the faithful performance of the duti es of the office, and on the faithful accounting of all monies and other property. Statutory Authority G.S. 83A-2; 83A-3; 83A-5, 83A-6. .0104 PROCEDURE (a) — Order of Business.—The President shall determine the general order of business to be followed at eaoh meeting of the Board and ohall generally follow the Rules of Parliamentary Procc (b) — Books and Records.—The following records shall be kept in the Board office under the roopon sibl e charge of the executive director and conoti tute the official records of the Board: fB Minutes and Reports.—There will be a book containing all minutes and offioial m-reports in proper order; Other Documents. Other documents will be filed and arranged so ao to properly care for applicants' papers. bills and receipts, general eorrespon donoo, material concerning the laws and procedure of other states and all other papers whioh are to be temporarily or permanently preserved. Statutory Authority G. S. 83A-5; 83A-6. .0105 DISCD7LINARY ACTION AND PROCEDURE The procedure to be followed in conducting disciplinary actions shall be in aooord with G.S 8 3A 1 4 and Chapter 150B of the North Carolina General Statutes. Statutory Authority G.S. 83A-6; 83-14. .0108 FEES Fees required by the Board, are payable in advance and are set forth below: Initial Registration Application Individual Residents $50.00 Nonresidents S 50.00 Corporate $75.00 Examination At Cost (See Rule .0301) Initial Exam Application $50.00 Re-examination $25.00 Annual license renewal Individual $50.00 Corporate $100.00 Late renewal Penalty $ 50.00 Reciprocal registration $150.00 Individual Reinstatement (prior year's renewal and late fees plus current 1906 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES renewal fee) $250.00 Copies of the roster and other publications and services provided by the Board are available at cost from the Board office. Statutory Authority G. S. 83A-4. SECTION .0200 - PRACTICE OF ARCHITECTURE .0201 BOARD LISTING OF INDrVIDUAL AND FORM NAMES Every individual licensee, partnership, firm or corporation has the continuing responsibility of keeping the Board currently advised of his or its proper and current mailing address and the name or names under which he or it is practicing. Each licensee or firm shall immediately notify the Board in writing of any and all changes of association or address. Upon the dissolution of a professional relationship, the architect member or members thereof shall promptly notify the Board in writing concerning such dissolution, and of the succeeding status and addresses of the individual or firm. rhis requirement is in addition to registration, isting and renewal requirements set out elsewhere in these Rules. Statutory Authority G.S. 83A-5; 83A-6. 0202 APPLICABDLITY OF BOARD RULES The Executive Director shall mail a copy of Chapter 83A of the North Carolina General Stat-utes and the rules of the Board adopted hereunder to each licensed architect in and out of the state to whom a new license has been issued, by virtue of laving successfully completed the prescribed sxamination and having otherwise met the Board's equirements for registration. Rules adopted and jublished by the Board under the provisions of Chapter 83A and Chapter 150B shall be binding ipon every individual holding a license from the Board, and upon all professional corporations egally authorized to offer or to perform architec-tural services in this state. All licensees of the Board are charged with having knowledge of the sustence of the Board rules and shall be deemed o be familiar with their several provisions and to mderstand them. Each licensed person and entity shall affirm in their renewals that they have read he current architectural laws and rules. Statutory Authority G.S. 83A-6. .0204 FORMS OF PRACTICE The practice of architecture may be carried on by sole practitioners, partnerships, professional limited liability companies, registered limited liability partnerships or registered architectural corporations, provided all those who practice are duly licensed, and the firm is properly described and identified by its name or title. Whenever the practice of architecture is carried on by a partner-ship, all partners must be duly licensed in North Carolina . Statutory Authority G.S. 83A-4; 83A-6; 83A-8; 57C-2-01; 59-84.2; 59-84.3. .0205 NAME OF FIRM (a) A licensee shall not engage in the practice of architecture under a professional or firm name which is misleading or deceptive in any way as to the legal form of the firm or the persons who are partners, officers, members, or shareholders in the firm. Examples of misleading or deceptive firm names include but are not limited to the following: (1) Use of the plural in any form when the number of architects in a firm does not warrant such use or, (2) Use of the name of an employee unless that employee is a partner, member or shareholder or, (3) Use of the name of deceased architect in order to benefit from his reputation, when that architect was not a former partner, officer, member or shareholder in the present firm, or (4) Use of a name which is deceptively similar to that of existing firm name. (b) Names of all architectural firms, whether sole proprietorships, partnerships, professional limited liability companies, registered limited liability partnerships or professional corporations, shall be approved in writing by the Board before adopted or used by such firm. Provided, however, that this Rule shall not be construed to require any firm to seek approval of, or to change, any name duly adopted in conformity with Board rules in effect at the date of such adoption other than a change that results in a violation of Subparagraph fa) (1) of this Rule . Statutory Authority G.S. 83A-6; 83A-9; 83A-12; 55B-5. .0206 REQUIREMENT FOR AND USE OF PROFESSIONAL SEAL h22 NORTH CAROLINA REGISTER February 15, 1995 1907 PROPOSED RULES (a) As more fully set out in this Rule, an architect must seal his work whether or not the work is for an exempt project. An architect shall not sign nor seal drawings, specifications, reports or other professional work which were not pre-pared by the architect or under his direct supervi-sion; provided, however, that in the case of the portions of such professional work prepared under the direct supervision of persons employed by the architect or the architect's firm and who are (4)(d) registered in this state, the architect may sign and seal those portions of the professional work if the architect has reviewed such portions and has coordinated their preparation. "Direct supervision" shall be that degree of supervision by a person overseeing the work of another whereby the supervisor has control over and detailed knowledge of the work prepared under his supervision. (_Q(a) Individual Seal Design. Every licensed architect shall have an individual seal which shall be composed of two con-centric circles with outer and inner circle diameters of approximately VA inches and 1 inch respectively. The architect's name and place of business shall be between the inner and outer circles. The words "Registered Archi-tect, North Carolina" shall be along the inside perimeter of the inner circle. The architect's North Carolina registra-tion number shall be in the center of the inner circle. (5)(«) {2}(b) Corporate Seal Design. Every corpora-tion which shall have obtained from the Board a certificate for corporate prac-tice shall have a corporate seal, which shall be composed of two concentric (6)(f) circles with outer and inner circle diam-eters of approximately 1 Vi inches and 1 inch respectively. The Architectural Corporation's approved North Carolina name and place of business shall be between the inner and outer circles. The words "Registered Architectural Corporation, North Carolina" shall be along the inside perimeter of the inner circle. The corporation's North Caroli- (l)(s) na registration number shall be in the center of the inner circle. £3)(e) Seal Types. The seal required for use on opaque original contract documents not intended for duplication shall be of a type which will produce an impres-sion facsimile of the seal, or a rubber stamp which will produce an ink fac-simile of the seal. The seal required for use on transparent original contract documents intended for duplication shall be of a type which will produce an ink facsimile of the seal such as a rub ber stamp, deoal, or computer generat ed type. The use of pre-printed docu ments bearing a pre-printed facsimile of the seal is prohibited. Individual Seal, Signature and Date Required. Architects shall affix their seal, actual signature, and date of affix-ation to all original contract documents including index sheets identifying all dmwingB—covered—specification—cover and index pages identifying all opooifi cation pages covered and supplemental drawings—whioh—afe — developed—aed issued under the direct oupervioion oi authorship of the arohitoct an contract dooumenta. architectural documents to be filed for public record. Document; shall be signed personally and sealed by the responsible architect. Final official record documents (such as tracings) shall be so signed. The signing and sealing of the index sheet or sheets {ij it identifies all parts) of drawings and specifications shall be considered ade quate. Without such index, all sheets and pages shall be so signed and sealed Presentation Documents. Presentation documents (renderings, drawings usee to communicate conceptual information only) are not required to be sealed oi signed. Incomplete Documents. Documents considered incomplete by the architect may be released for interim review without the architect's seal or signature affixed, but shall be dated, bear the architect's name and be conspicuously marked to clearly indicate the docu ments are for interim review and not intended for bidding, permit, or con struction purposes. Sheets or Pages Prepared By Licensed Professional Consultants. Those sheets or pages prepared by licensed profes sional consultants (such as, for exam pie, structural, mechanical or electrical engineers) retained by the architect shall bear the seal and registration number of the consultant responsibl therefore. 1908 NORTH CAROLINA REGISTER February 15, 1995 9:22 PROPOSED RULES (8){f) Original Signature. The use of signa-ture reproductions such as rubber stamps or computer generated or other facsimiles shall not be permitted in lieu of actual signatures. (9}(j) Security of Seal. Authorized use of the prescribed seal is an individual act whereby the architect must personally sign over the imprint of the seal. The architect is responsible for security of the seal when not in use. 10)(k) Use of Corporate Seal. The use of the corporate seal does not replace the statutory requirement for an architect's individual seal as required in Subpara-graph (d) (a)(4) . The corporate seal must be affixed in addition to the indi-vidual seal on the cover sheet and each page of the table of contents of specifi-cations and drawings. (b) Standard Design Documents. Standard design documents prepared by architects who are registered in this state or in their state of origin may be sealed by a succeeding licensed architect registered in North Carolina provided: (1) the seal of the original architect appears on the documents to authenticate au-thorship; (2) the words "standard design document" appear on each sheet of the documents prepared by the original architect; (3) the succeeding North Carolina architect clearly identifies all modifications to the standard design documents; (4) the succeeding North Carolina architect assumes responsibility for the adequacy of the design for the specific application in North Carolina and for the design conforming with applicable building codes; and (5) the succeeding North Carolina architect affixes his seal to the standard design documents and a statement substantially as follows: "These documents have been properly examined by the under-signed. I have determined that they comply with existing local North Caro-lina codes, and I assume responsibility for the adequacy of the design for the specific application in North Carolina." (c}{fe) Direct Supervision. No architect shall iffix his seal and signature to contract documents ieveloped by others not under his direct supervi-sion. Direct supervision includes: (1) Dissemination of programmatic re-quirements, (2) Ongoing coordination and correlation of consultant's work services with other aspects of the total design of the pro-ject, (3) Verification with consultant that owner's requirements are being met, (4) Authority over the work services of those who assisted in the preparation of the documents, (5) Assumption of responsibility for the consultant's work, services, and (6) Incorporation of cons ultant's — work services into design documents to be issued for permitting purposes. Statutory Authority G.S. 83A-6; 83A-10; 83A-12. .0207 DENIAL: SUSPENSION OR REVOCATION OF LICENSE (a) Denial.—The Board may refuse to grant an examination, or after examination refuse to grant a lic ense for the practice of architecture, to any person convicted of a felony,—or who,—in th e opinion of the Board, has been guilty of di shonest or unprofessional conduct, or lacks good moral character as defined in G.S. 8 3A 1(5). {&) — Discipline Affecting License .—The Board may l evy a civil penalty, reprimand, suspend for a — period—ef- — time,—ef—reveke—any — corporate certificate of regi s tration or di scipline a licensee pursuant to G.S. 83A 15. Statutory Authority G.S. 83A-1; 83A-6; 83A-7; 83A-15. .0208 DISHONEST CONDUCT In addition to tho se grounds as s tated in G.S. 83A 15(1) the following act s or omissions, among others, may be deemed to be "dishonest conduct" and to be cause for th e levy of a civil penalty or for a denial, suspension, or revocation of a license ef c ertificate ef- regi stration te practice architecture : fB Deceitful Statements.—It s hall be deemed di shonest conduct to—make untrue or deceitful statements in an application for examination, any other application to the Board—ef — m—any — statements—ef representations—te—the — Board—ef— a committee of the Board. (a) Deception. An architect shall not deliberately make a materially false statement or fail deliberately to disclose a material fact requested in connection with his application for 9:22 NORTH CAROLINA REGISTER February 15, 1995 1909 PROPOSED RULES registration renewal. (b) Contributions, offer nor make any An architect shall neither gifts, other than gifts of nominal value (including, for example, reasonable entertainment and hospitality), with the intent of influencing the judgement of an existing or prospective client in connection with a project in which the architect is interested. (c) Registration of Others. An architect shall not assist the application for registration of a person known by the architect to be unqualified with respect to education, training, experience, or character. (d) Knowledge of Violation. An architect possessing knowledge of a violation of these Rules by another architect shall report such knowledge to the Board. (3) Misrepresentation.—It shall be deemed dishonest conduct for an architect—to permit the use of his professional seal by others, or otherwise represent himself as the author of drawings or specifications which are not personally prepared by him ef under his direct supervision. However,—"standard design documents" prepared by architects who are registered in this state or in th eir state of origin may be— s ealed—by—a — succeeding—lic ensed architect—registered—in North—Carolina provided: {a) the seal of the original architect appears en—the — doouments—te — authenticate authorship; <+H th e words " s tandard d esign docume nt" appear on each sh eet of the documents prepared by the original architect; {e} the succeeding North Carolina architect clearly identifies all modifications to the standard design documents; {d) the succeeding North Carolina architect assumes responsibility for th e adequacy of th e des ign for th e specific application in North Carolina and for th e design conforming—with — applicable — building codes; and the succeeding North Carolina architect affixes his seal to the standard design doouments and a statement substantially &- -feik "Th ese documents have been properly examined—by—the undersigned. 1 have determined that th ey comply with existing local North Carolina codes. and 1 assume responsibility for th e adequacy of th e design for the specific application in m- North Carolina." Contributions. 4t — shall—be—dee»e< dishonest conduct—for an architect t< make or promise to make contributions o money—or service,—with the intent h bribe,—for the purpose of securing i commission e-F — influencing—tt engagement—er— e mployment—ef-—ai architect for a project. Statutory Authority G.S. 83A-6; 83A-15. .0209 UNPROFESSIONAL CONDUCT In addition to those grounds as stated in G.S 83A-15(3) the following acts or omissions, amonj others, may be deemed to be "unprofessiona conduct", and to be cause for the levy of a civi penalty or for denial, suspension, or revocation o a license or certificate of registration to practice architecture: (1) Compliance With Laws. It shall b< deemed unprofessional conduct for ai architect, in the conduct of his or he professional practice, to knowingl; violate any state or federal criminal law A criminal conviction shall be deeme< prima facie evidence of knowingl) violating the law. (2) Compliance With Foreign Registration It shall be deemed unprofessional conduc for an architect to knowingly violate the laws governing the practice architecture or the rules promulgated bj any other architectural licensing board ii any United States jurisdiction. A findin by a foreign architectural registratio board that an architect has violated a law or rule governing the practice o architecture shall be deemed prima faci evidence of knowingly violating the law or rule. (3) Product Specification. It shall be deeme< unprofessional conduct for an architect tc solicit or accept financial or othe: valuable consideration from material o equipment suppliers for specifying thei products. (4) Advertising. It shall be deemec unprofessional conduct for an architect tc engage in any false, deceptive fraudulent, or misleading advertising. (5) False Statements. It shall be deemec unprofessional conduct for an architect U knowingly make false statements abou the professional work or to malicious!) 1910 NORTH CAROLINA REGISTER February 15, 1995 9:2. PROPOSED RULES injure the prospects, practice, or employment position of others active in the design and construction of the physical environment. (6) Evasion. (a) It shall be deemed unprofessional conduct for an architect, through employment by building contractors, or by another not holding an individual or corporate certificate from the Board, to enable the employer to offer or perform architectural services, except as provided in G.S. 83A-13. In design/build arrangements, the architect shall not be an employee of a person or firm not registered or licensed to practice architecture in North Carolina. (b) It shall be deemed unprofessional conduct for an architect to furnish limited services in such manner as to enable owners, draftsmen, or others to evade the public health and safety requirements of Chapter 83A or the building permit requirements of Chapter 160A of the North Carolina General Statutes. G.S. 133-2, G.S. 153A-26 or G.S. 160A-417. (c) When building plans are begun or contracted for by persons not properly licensed and qualified, it shall be deemed unprofessional conduct for an architect to take over, review, revise, or sign or seal such drawings or revisions thereof for such persons, or do any act to enable either such persons or the project owners, directly or indirectly, to evade the requirements of Chapter 83A or G.S. 160A-417. (7) Branch Office. U—sbaH—be — deemed unprofessional conduct for an architect to maintain or represent by sign, li sting, or other manner that he maintains an arohi teotural office or branch offioe unless suoh office is continuously staffed with a registered arohiteot in oharge.—Provided, however, that this Rule does not apply to on site project offioes during oonstruo tion. Each office maintained for the preparation of drawings, specifications, reports, or other professional work shall have an architect resident and regularly employed in that office having direct knowledge and supervisory control of such work. ) Misrepresentation Regarding Prior Expe-rience. Because of the rolianoo the pub lie plaoes on architects' qualifications, the following—requirements—afe — provided regarding the representation of pas t pro fessional experience. An architect shall accurately represent to a prospective or existing client or employer his qualifica-tions and the scope of his responsibility in connection with work for which he is claiming credit. (a) It shall be the responsibility of each registered architect to clearly and ap-propriately state prior professional experience of the architect and/or the firm the architect is representing in presenting qualifications to prospective clients, both public and private. If an architect uses visual representations of prior projects or experience, all architects-of-record must be clearly identified. Architect-of-record means persons or entities whose seals appear on plans, specifications and/or contract documents. (b) An architect who has been an employee of another architectural practice may not claim unconditional credit for pro-jects contracted for in the name of the previous employer. The architect shall indicate, next to the listing for each project, that individual experience gained in connection with the project was acquired as an employee, and identify the previous architectural firm. The architect shall also describe the nature and extent of his/her participa-tion in the project. (c) An architect who was formerly a princi-pal in a firm may legitimately make additional claims provided he/she dis-closes the nature of ownership in the previous architectural firm (e.g. stock-holder or junior partner) and identifies with specificity his/her responsibilities for that project. (d) An architect who presents a project that has received awards recognition must comply with the requirements in Sub-paragraph (8) of this Rule with regard to project presentation to the public and prospective clients. (e) Projects which remain unconstructed and which are listed as credits should be listed as "unbuilt or a similar desig-nation. 22 NORTH CAROLINA REGISTER February 15, 1995 1911 PROPOSED RULES (9) Influencing Government Officials. An architect shall neither offer nor make any payment or gift to a government official (whether elected or appointed) with the intent of influencing the official's judgment in connection with a prospective or existing project in which the architect is interested, (10) Fee Bidding on Public Projects. An architect shall not knowingly cooperate in a violation of any provisions of G.S. 143- 64.31. (11) Cooperation with Board. An architect shall fully cooperate with the Board in connection with any inquiry it shall make. Full cooperation includes responding in a timely manner to all inquiries of the Board or representative of the Board and claiming Board correspondence from the U.S. Postal Service. Statutory Authority G.S. 83A-6; 83A-15. .0210 INCOMPETENCE Any architect who has suffered impairment of skill and oare in rendering professional services due to a mental or physical disability or addiction to alcohol or drugs so as to potentially endanger the health, safety and welfare of the public- may voluntarily surrender his license to th e Board at any time prior to a filing of a Notice of Hearing in a contested case.—The Board, in its discretion, may accept the surrender, or reject the surrender and prooood to a Notice of Hearing under the provisions of Chapter 150B. (a) In practicing architecture, an architect shall act with reasonable care and competence and shall apply the technical knowledge and skill which is ordinarily applied by architects of good standing, practicing in the same locality. (b) In designing a project, an architect shall take into account all applicable state and municipal building laws and regulations. While an architect may rely on the advice of other professionals (e.g., attorneys, engineers and other qualified persons) as to the intent and meaning of such regulations, once having obtained such advice, an architect shall not knowingly design a project in violation of such laws and regulations. (c) An architect shall undertake to perform professional services only when he, together with those whom the architect may engage as consultants, are qualified by education, training and experience in the specific technical areas involved. (d) No person shall be permitted to practk architecture, if, in the board's judgment. su< person's professional competence is substantial impaired by physical or mental disabilities. Statutory Authority G.S. 83A-6; 83A-15. .0212 INDEPENDENT JUDGMENT AND DISCLOSURE Upon reoeipt of information or complaint, tt Board,—m—its — discretion,—may — investigate ai incidence of the all eged prohibited praotioo-architecture — in North—Carolina by—individual firm s—ef — corporations—net—duly — licensed regi stered—by—the — Board. Following—sw investigation, the Board shall determine whether net—te—take — legal—action—by—way — of crimin pro secution or injunction or such oth er action as deems necessary to prevent the unlicensed practk of architecture. (a) When acting as the interpreter of buildii contract documents and the judge of contra performance, an architect shall render decisioi impartially, favoring neither party to the contract (b) If, in the course of his work on a project. architect becomes aware of a decision taken by h employer or client, against the architect's advici which violates applicable state or municip; building laws and regulations and which will, the architect's judgment, materially affe< adversely the safety to the public of the finishe project, the architect shall: (1) report the decision to the local buildin inspector or other public offici 12} £3} charged with the enforcement of tl applicable state or municipal buildin laws and regulations; refuse to consent to the decision; in circumstances where the archite< reasonably believes that other sue decisions will be taken notwithstandin his objection, terminate his service (4} with reference to the project; and in the case of termination in accordanc with clause in Subparagraph (b)(3) ( this Rule, the architect shall have n liability to his client or employer o account of such termination. (c) If an architect has any business associatio or direct or indirect financial interest which i substantial enough to influence his judgment i connection with the performance of profession. services, the architect shall fully disclose i writing to his client or employer the nature of th business association or financial interest, and if th 1912 NORTH CAROLINA REGISTER February 15, 1995 9:2 eing compensated for making such statements. tatutory Authority G.S. 83A-6; 83A-15. D215 FOREIGN CORPORATIONS (a) Incorporation in Other States. Architectural orporations of other states may be granted orporate certificates for practice in this State on le receipt by the Board of a completed pplication, the submission of a certified copy of leir corporate charter, amended as may be ecessary to insure full compliance with all squirements of Chapter 55B, the Professional lorporation Act of the State of North Carolina, nd the payment of the corporate application fee. a addition to the other requirements as set out in i.S. 83A-8, foreign corporations must, prior to sgistration, receive from the Secretary of State of forth Carolina a certificate of authority to do usiness within the state. The registration squirements for foreign corporations cannot be PROPOSED RULES lient or employer objects to such association or nancial interest, the architect will either terminate uch association or interest or offer to give up the ommission or employment. (d) An architect making public statements on rchitectural questions shall disclose when he is voided by practice in North Carolina through an idividual licensee. (b) Designated Individuals. Foreign orporations shall be permitted to practice rchitecture within the State of North Carolina rovided that at least two-thirds of the issued and utstanding shares of the foreign corporations are wned by licensed architects or engineers who are censed to practice their profession in a lrisdiction of the United States. However, the orporation must designate at least one architect /ho is licensed in the State of North Carolina to e in responsible charge for the corporate practice f architecture within the State of North Carolina. 'tatutory Authority G.S. 55B-6; 83A-6; 83A-8. 0216 ANNUAL LISTING OF PARTNERSHIP (a) By December 31 of each year, each artnership or registered limited liability lartnership engaged in the practice of architecture n North Carolina shall submit a list of all resident nd non-resident partners of the partnership, (b) One annual listing by a representative of the partnership shall satisfy the requirements of aragraph (a) of this Rule for all partners of the inn; however, each partner shall remain responsible for compliance with the rules. (c) Changes in the information required by Paragraph (a) of this Rule shall be filed with the Board office within 30 days after the change occurs. Statutory Authority G.S. 83A-6; 83A-9. .0218 LIMITED LIABILITY COMPANIES Architects may practice in this state through duly authorized limited liability companies only as provided under G.S. 57C-2-01(c). Any limited liability company that offers to practice or practices architecture in this state must comply with the same requirements applicable to professional corporations under Rules .0201, .0202, .0204, .0205, .0214. and .0215 of this Chapter. Statutory Authority G.S. 57C-2-01; 83A-6. .0219 REGISTERED LIMITED LIABILITY PARTNERSHIPS Architects may practice in this state through duly registered limited liability partnerships only as provided under G.S. 59-84.2 and G.S. 59-84.3. Any registered limited liability partnership that offers to practice or practices architecture in this state must comply with the same requirements applicable to partnerships under Rules .0201, .0202, .0204, .0205, and .0216 of this Chapter. Statutory Authority G.S. 83A-6; 59-84.2; 59-84.3. SECTION .0300 - EXAMINATION PROCEDURES .0302 WRITTEN EXAMINATION (a) Licensure Examination. All applicants for architectural registration in North Carolina by written examination must pass the Architectural Registration Examination (ARE), administered in North Carolina, prepared by the National Council of Architectural Registration Boards (NCARB). Provided, applicants who have never been registered in any state or territory may transfer credits for portions of the examination previously passed in another state if at the time of taking the exam elsewhere they otherwise qualified for taking the exam in North Carolina. (1) Description. The nature of the examination is to place the candidate in areas relating to actual architectural situations whereby his abilities to exercise competent value judgements K-22 NORTH CAROLINA REGISTER February 15, 1995 1913 PROPOSED RULES (2) will be tested and evaluated. Qualifications. The prequalifications necessary for an applicant's admission to the Architectural Registration examination (ARE) are as follows: (A) be of good moral character as defined in North Carolina General Statute 83A-K5); (B) be at least 18 years of age; (C) hold a degree in architecture from a college or university where the degree program has been approved by the Board, or professional education equivalents as outlined and defined in the North Carolina Board of Architecture's |
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