INDEPENDENT REGULATORY REVIEW COMMISSION Notice of Comments Issued [45 Pa.B. 5002]
[Saturday, August 22, 2015]Section 5(g) of the Regulatory Review Act (71 P. S. § 745.5(g)) provides that the Independent Regulatory Review Commission (Commission) may issue comments within 30 days of the close of the public comment period. The Commission comments are based upon the criteria contained in section 5.2 of the Regulatory Review Act (71 P. S. § 745.5b).
The Commission has issued comments on the following proposed regulations. The agency must consider these comments in preparing the final-form regulation. The final-form regulation must be submitted within 2 years of the close of the public comment period or it will be deemed withdrawn.
Close of the Public IRRC Comments Reg No. Agency/Title Comment Period Issued 126-11 Philadelphia Parking Authority
Modern Taxicab Standards
45 Pa.B. 2876 (June 13, 2015)7/13/15 8/12/15 16A-5513 State Board of Accountancy
Act 73 and Act 15 Amendments
45 Pa.B. 2878 (June 13, 2015)7/13/15 8/12/15
Philadelphia Parking Authority Regulation #126-11 (IRRC #3103) Modern Taxicab Standards August 12, 2015 We submit for your consideration the following comments on the proposed rulemaking published in the June 13, 2015 Pennsylvania Bulletin. Our comments are based on criteria in Section 5.2 of the Regulatory Review Act (71 P. S. § 745.5b). Section 5.1(a) of the Regulatory Review Act (71 P. S. § 745.5a(a)) directs the Philadelphia Parking Authority (PPA) to respond to all comments received from us or any other source.
1. Whether the regulation represents a policy decision of such a substantial nature that it requires legislative review.
The Preamble to this rulemaking states that the purpose of this proposal is to improve the quality and capability of taxicabs in Philadelphia. This will be accomplished by requiring all vehicles proposed for medallion taxicab service and 25 percent of each carrier's fleet of partial-rights taxicabs to be wheelchair accessible. In addition, the proposal will require all vehicles brought into taxicab service to be late model vehicles with less than 500 miles on the odometer. PPA anticipates a gradual upgrading of the taxicabs because the improvements will occur as existing vehicles are replaced.
Members of the riding public, advocates for individuals with disabilities and public officials from the City of Philadelphia have submitted comments expressing support for this proposal. Conversely, members of the regulated taxicab industry are opposed to it. This Commission recognizes the benefits this proposal will have for users of taxicabs in Philadelphia, particularly individuals with disabilities, and is aware of the negative fiscal impact the rulemaking could have on the taxicab industry. We are also cognizant of the impact that unregulated competitors providers are having on the taxicab industry in Philadelphia, the Commonwealth and throughout the country.
Against this backdrop, we believe that the proposal being offered by PPA is a policy decision of such a substantial nature that it requires legislative review. In the Regulatory Analysis Form submitted with the proposal, PPA states that it will, ''act on its own when possible, seek active participation of the riding public and the regulated industry at all times and may seek additional authorization from the Legislature to bring about the level of taxicabs service demanded by today's more discerning customers.'' (Emphasis added.) We believe PPA's proactive approach to the many issues facing the taxicab industry in Philadelphia is laudable. Given the contentious nature of this rulemaking, however, we encourage PPA to seek guidance from and work closely with the General Assembly as it moves forward with this proposal.
2. Whether the regulation is consistent with the intent of the General Assembly; Statutory authority.
While this Commission does not question the policy goals of PPA and this rulemaking, we do question whether PPA has the statutory authority to pursue those goals as set forth in this rulemaking and whether the goals align with existing law, and therefore the intent of the General Assembly. As noted by commentators, it would appear that PPA is only authorized to issue a specific number of new certificates of public convenience and corresponding medallions for wheelchair-accessible vehicles (WAVs). 53 Pa.C.S.A. § 5711(c)(2) reads as follows:
The authority is authorized to issue the following:
(i) Subject to the provisions of subparagraph (ii), a maximum of 1,600 certificates of public convenience and corresponding medallions for citywide call or demand service and an additional 15 certificates of public convenience and corresponding medallions restricted to wheelchair-accessible taxicab service as provided in this chapter.
(ii) Beginning June 1, 2013, and each June 1 thereafter until there is a total of 1,750 certificates of public convenience and corresponding medallions, the maximum number of certificates of public convenience and corresponding medallions for citywide call or demand service shall be increased by 15. The authority, in its discretion, may issue the certificates and medallions authorized by this subparagraph with special rights, privileges and limitations applicable to issuance and use as it determines necessary to advance the purposes of this chapter and may issue the certificates and medallions authorized by this subparagraph in stages.
What is PPA's specific statutory authority to convert Philadelphia's existing fleet of certificated vehicles into WAV's? In addition, what is PPA's specific statutory authority that would allow it to require partial rights taxicab companies to convert 25 percent of their fleets into WAVs?
3. Determining whether the regulation is in the public interest.
Section 5.2 of the Regulatory Review Act (RRA) (71 P. S. § 745.5b) directs this Commission to determine whether a regulation is in the public interest. When making this determination, the Commission considers criteria such as the impact on small businesses and reasonableness. To make that determination, the Commission must analyze the text of the proposed rulemaking and the reasons for the new or amended language. The Commission also considers the information a promulgating agency is required to provide under § 745.5(a) in the regulatory analysis form (RAF). Upon review of the RAF, we find that PPA has not provided an adequate analysis of how the regulation will impact small businesses and has not provided a description of any alternative regulatory provisions that were considered. Without this information, we cannot determine if this proposed regulation is in the public interest. In the RAF submitted with the final-form rulemaking, PPA should provide more detailed information required under § 745.5(a) of the RRA.
4. Economic or fiscal impact of the regulation.
Taxicab industry
Commentators from the taxicab industry are concerned about the fiscal impact the proposal will have on them. They believe the cost estimates provided by PPA are understated and contend that the proposal will prohibit future financing of new vehicles. They also point out that the value of existing medallions will diminish. According to commentators, existing non-WAV medallions are valued at approximately $350,000. However, WAV medallions are worth between $80,000 and $110,000. We ask PPA to address these concerns in the RAF and Preamble to the final-form regulation. We will evaluate PPA's responses to these issues in making our determination if the rulemaking is in the public interest.
PPA
We are also concerned about the fiscal impact this proposal could have on PPA. 53 Pa.C.S.A § 5706(a.1) (relating to wheelchair-accessible taxicab driver training), requires PPA to provide WAV certificated drivers a one-time stipend for each day of training the driver attends. It also provides that the annual WAV taxicab driver renewal fee is to be paid from the proceeds of sale of WAV medallions for each successfully renewed application. Since the number of WAV taxicab drivers will dramatically increase, the costs imposed by this statutory provision will also increase. We ask the PPA to quantify these costs and to include those costs in the RAF submitted with the final-form rulemaking.
5. Possible conflict with or duplication of statutes or existing regulations; Implementation procedures; Reasonableness.
If this rulemaking is adopted, and as standard taxicabs are replaced by WAV taxicabs, every taxicab driver will have to meet the requirements of Section 1021.5a (relating to special wheelchair accessible vehicle taxicab driver's certificate and requirements). We have two concerns about this requirement. First, Section 1021.5a(b)(7)(i) requires WAV taxicab drivers to have two years of experience driving a cab in Philadelphia. Commentators believe that this could lead to a shortfall of taxicab drivers in Philadelphia. Second, Section 1021.5a(c) establishes a cap on the number of WAV taxicab drivers. Under this subsection, the number of WAV drivers may not exceed the product of the number of WAV taxicabs multiplied by four. Is this provision still needed under this proposed rulemaking? In addition to addressing these issues, we ask PPA to review all provisions of 52 Pa. Code Chapter 1021 (relating to taxicab drivers) to ensure the proposed rulemaking is consistent and does not conflict with existing requirements.
6. Section 1017.4. Age and mileage limitations.—Statutory authority; Possible conflict with or duplication of statutes or existing regulations; Clarity.
The following language is being added to Paragraph (c), relating to antique vehicles: ''The number of antique vehicles in operation in a fiscal year may not exceed 2% of the vehicles comprising the taxicab utility group.'' What is a ''taxicab utility group''? To improve the clarity of the proposal, we suggest that it be defined in the final-form regulation.
Under Paragraph (d)(1) every medallion taxicab must comply with Section 1017.8 (relating to wheelchair accessible vehicle taxicab specifications), and under Paragraph (d)(2), every partial-rights taxicab must comply with the age and mileage requirements of Section 1017.8(c) as a condition of eligibility for inspection as provided in Section 1017.2. This paragraph would require all vehicles brought into service for the first time to be late models with less than 500 miles and also limit the age of taxicabs to five years. We have two concerns. First, we question the reasonableness of the mileage limitation. This restriction would preclude a medallion owner or a partial-rights taxicab company from purchasing safe, yet cheaper vehicles. How did PPA determine that all new vehicles brought into service should have less than 500 miles? In the Preamble to the final-form regulation, we ask PPA to explain the basis for this decision. Second, the age limitation of five years conflicts with 53 Pa.C.S.A § 5714(a)(4), which allows vehicles to operate until they reach eight years of age. We ask PPA to explain how the proposed regulatory provisions are permitted under the cited statutory language.
State Board of Accountancy Regulation #16A-5513 (IRRC #3104) Act 73 and Act 15 Amendments August 12, 2015 We submit for your consideration the following comments on the proposed rulemaking published in the June 13, 2015 Pennsylvania Bulletin. Our comments are based on criteria in Section 5.2 of the Regulatory Review Act (71 P. S. § 745.5b). Section 5.1(a) of the Regulatory Review Act (71 P. S. § 745.5a(a)) directs the State Board of Accountancy (Board) to respond to all comments received from us or any other source.
1. Substantial Equivalency—Implementation procedures; Protection of the public welfare.
The CPA law provides for substantial equivalency in 63 P. S. §§ 9.5b and 9.5d. In general terms, a person or firm located outside of Pennsylvania whose qualifications are substantially equivalent to the Board's ''shall have all the privileges and obligations of a licensee of the Commonwealth without the need to obtain a certificate or license under this act'' and can be subject to discipline by the Board and the courts of Pennsylvania. 63 P. S. §§ 9.5b(b) and 9.5d(c). The CPA Law also provides that ''Any determination as to whether substantial equivalency exists . . . shall be consistent with any determination . . . made by the National Association of State Boards of Accountancy National Qualification Appraisal Service [NASBANQAS].'' 63 P. S. § 9.5b(a). We have two categories of questions relating to how these provisions will be implemented by the Board.
First, under the CPA Law and the Board's regulation, we presume that the Board will most likely not have notice of an accountant practicing under substantial equivalency. How does the Board know how many individuals and firms are practicing in Pennsylvania under substantial equivalency and who they are? Does the Board have any mechanism to obtain this information under the CPA law?
Second, who makes the important determination of substantial equivalency before services are rendered? While we expect that most practicing accountants would obtain and disclose to their clients an equivalency determination from the NASBANQAS, we are concerned that an invalid self-determination could be made outside of this service that could harm the consumer of the accounting services. How can the consumer be protected from an invalid self-determination of substantial equivalency? Are all the other states' requirements substantially equivalent to the Board's requirements? If not, does the Board maintain a list of states that it considers to be substantially equivalent to Pennsylvania that is available to the public? We ask the Board to explain how substantial equivalency will be implemented in a way that protects the consumer of accounting services.
2. Section 11.7. Use of the designation ''public accountant'' and the abbreviation ''PA.''—Clarity.
Use of an exception to include substantial equivalency
Subsection (a) of the existing regulation lists three entities that can ''. . .use the designation 'public accountant,' the abbreviation 'PA,' or any other title . . . tending to indicate that the user is a public accountant. . . .'' The Board is amending this subsection to include substantial equivalency by adding a phrase that states, in part, ''Except as provided in § 11.5(e). . . .'' We have two concerns.
First, as amended by Act 15 of 2013 (Act 15), 63 P. S. § 9.5b(b) states that practice under substantial equivalency is the same as practicing as a licensee in Pennsylvania and, in particular, Paragraph (1) states that:
. . . an individual whose principal place of business is not in this Commonwealth and who has a valid certificate or right to practice from a state that is substantially equivalent . . . shall have all the privileges and obligations of a licensee of this Commonwealth. . . .
Firms and unlicensed entities are addressed in 63 P. S. § 9.5d. Since, by statute, practice under substantial equivalency is substantively the same as having a Board license, it is not clear why the regulation should reference substantial equivalency as an exception.
Second, Section 8.2 of the Pennsylvania Code and Bulletin's Style Manual addresses use of exceptions and states, ''If possible, state a requirement directly rather than by use of exceptions.'' Given the statutory language and the Style Manual, we recommend that substantial equivalency be added to Subsection (a) as a fourth paragraph rather than as an exception.
Use of an exception in Subsection (b)
Similar to Subsection (a), this subsection adds substantial equivalency as an exception. We recommend adding substantial equivalency to the end of the sentence instead.
3. Section 11.8. Use of the designation ''certified public accountant'' and the abbreviation ''CPA'' in the practice of public accounting.—Clarity.
Exceptions added to Subsections (a) and (b)
Subsections (a) and (b) both add substantial equivalency as an exception. For the reasons explained in the above comments on Section 11.7, we recommend adding substantial equivalency to Subsection (a) as a fourth paragraph and to Subsection (b) at the end of the sentence.
4. Section 11.23a. Competence to supervise attest services.—Protection of the public welfare; Clarity.
400 hours of experience
A public commentator questioned the provision in Subparagraph (b)(1)(i) that requires 400 hours of experience within the previous five years. The commentator believes it would be prudent to require more than 80 hours per year given the pace of change in the accounting profession. We ask the Board to explain how this provision sufficiently protects the public welfare.
Continuing Professional Education (CPE)
Paragraph (b)(1)(i) sets a two-pronged competency requirement of ''400 hours of experience within the previous 5 years'' and ''at least 24 hours of CPE . . . during the 24 months immediately preceding issuance of the report.'' Subsection (c) states an exemption that the requirements of Subsection (b) do not apply to a licensee licensed prior to August 18, 2013. Subsection (c) would exempt a category of licensees from both the 400 hours of experience and 24 hours of CPE. Why should this category of licensee be exempt from the CPE requirement?
5. Section 11.55. Experience requirements for CPA certification.—Need; Reasonableness; Economic impact; Clarity.
Calculation of hours of experience
Majority Chair Representative Julie Harhart and Minority Chair Representative Harry Readshaw of the House Professional Licensure Committee (HPLC) submitted a joint comment stating their agreement with the comments submitted by the Pennsylvania Institute of Certified Public Accountants (PICPA). PICPA commented that the wording of Section 11.55 would make it difficult for part-time or seasonal candidates to meet the requirements to apply for CPA certification. As written, a candidate must complete at least one year of qualifying experience during the 60-month period immediately preceding the date of application, and each year of experience must include 1,600 hours of qualifying experience. PICPA cited the example of tax preparers who might only accrue 680 hours in a tax season per year, but would not qualify for CPA certification even after accumulating 1,600 hours of experience within the 60-month period. PICPA does not believe this is the Board's intent and suggests alternative language. We agree with the HPLC's and PICPA's concern and recommend that the Board amend this requirement accordingly, or explain why the requirement is needed and reasonable.
6. Section 11.63. CPE subject areas; relevance to professional competence.—Clarity.
Continuing Professional Education (CPE) hours
Paragraph (a)(1) requires a minimum of 24 hours of CPE and includes the sentence:
A licensee who supervises attest services and signs an accountant's report for attest services may also need to complete additional CPE as provided in § 11.23a (relating to competence to supervise attest services). (Emphasis added.)
Paragraph 11.23a(b)(1)(i) requires the same amount of CPE of ''at least 24 hours.''
Considering the provisions of both Paragraph (a)(1) and Paragraph 11.23a(b)(1)(i), it is not clear what total number of hours of CPE are required for a licensee to comply with the regulation. We recommend that the Board review and amend Paragraph (a)(1) and Paragraph 11.23a(b)(1)(i) as necessary to clarify how to comply with the CPE requirements.
JOHN F. MIZNER Esq.,
Chairperson[Pa.B. Doc. No. 15-1558. Filed for public inspection August 21, 2015, 9:00 a.m.]
