• A description of the project for which the county drainage board seeks a grant.
• The estimated cost of the project.
• The county drainage board's plan for financing the project.
• Competitive bidding or other procedures that the county drainage board will use to control project costs.
• Other information required by DATCP.
Grant awards
Under this rule, DATCP must act on all grant applications within 90 days after the annual grant application deadline. DATCP must notify all grant applicants of its grant awards.
Grant contracts
Under this rule, DATCP must enter into a grant contract with each grant recipient. The contract must specify grant terms and conditions. DATCP must distribute grant funds according to the grant contract.
Grant payments
DATCP will make grant payments after the county drainage board documents that it has completed the funded project and paid its share of the project costs. DATCP will not pay any project costs incurred after the end of the grant term specified in the grant contract.
A county drainage board must submit a payment request on a form provided by DATCP. The county drainage board must document that it has completed the project and paid its share of the project costs.
DATCP will make grant payments to the county treasurer, for the benefit of the county drainage board. If the county drainage board hires an agent to complete a project on its behalf, DATCP may make a check jointly payable to the county treasurer and that agent.
County drainage board accounts
Under this rule, whenever a person receives funds on behalf of a county drainage board or any drainage district, that person must promptly deposit those funds with the county treasurer. The county treasurer may not pay out any funds without proper authorization from the county drainage board.
Pursuant to s. 88.18(1), Stats., the county treasurer may retain a portion of the interest received on drainage district funds, to cover costs that the county treasurer and county zoning administrator incur to provide services to the county drainage board. The amount retained may not exceed the amount authorized by s. 88.18(1), Stats.
Under this rule, the county treasurer must keep a separate account for each drainage district. The county treasurer must keep complete accounting records in the county treasurer's office. The accounting records must include records of all receipts, deposits, payments, county deductions and account balances. The county drainage board must also file, with the county treasurer, a copy of every DATCP grant contract with the county drainage board.
The county treasurer must retain the accounting records as county records. Except as provided in ch. 88, Stats., or ch. ATCP 48, the county treasurer must treat the records as the treasurer would treat comparable county accounting records for retention and disposal purposes.
Under this rule, if a county drainage board appoints its own treasurer, that treasurer serves as a deputy of the county treasurer. The county drainage board treasurer must promptly deposit, with the county treasurer, all funds received on behalf of the county drainage board or any drainage district. The drainage board treasurer may not pay out any funds before depositing them with the county treasurer.
The drainage board treasurer may not pay out any funds without proper authorization from the county drainage board and the county treasurer. The county treasurer may not refuse to authorize a payment approved by the county drainage board, unless there are insufficient funds in the drainage district account to make that payment. The county treasurer must keep complete records of all drainage district accounts (the drainage board treasurer may keep duplicate records).
Fiscal Estimate
Impact of Rule Revision to State Government
Chapter ATCP 48 is administered by the Department of Agriculture, Trade and Consumer Protection (DATCP). The proposed rule revisions codify a cost-share grant program intended to distribute as much as $500,000 per year for a maximum of six years to county drainage boards. Administration of these grants will be handled by existing DATCP staff. The DATCP will experience some increase in costs associated with WiSMART charges and other miscellaneous administrative expenses, such as postage; however, these administrative costs will be minimal and will be absorbed by the DATCP. Funds provided by the Legislature for this program are in a new general purpose revenue appropriation.
Impact of Rule Revision to County Drainage Boards
Funds provided by the DATCP will go directly to county drainage boards to pay 60% cost-sharing for eligible expenses associated with the development of district specifications, benefits reassessment, and compliance (maintenance) plans. The availability of these funds will encourage drainage boards to proceed with this work as the grant funds greatly reduce the financial burden on drainage district landowners. District landowners will be assessed by the drainage board for the remaining 40% of eligible project expenses.
Initial Regulatory Flexibility Analysis
See 2/15/01 Wis. Adm. Register, page 20.
Notice of Hearing
Agriculture, Trade and Consumer Protection
The state of Wisconsin Department of Agriculture, Trade and Consumer Protection announces that it will hold a public hearing on a proposed rule (proposed ch. ATCP 161, subchapter III, Wis. Adm. Code) relating to annual grants to ethanol producers. The hearing will be held:
Monday, March 12, 2001 at 1:00 p.m.
Wisconsin Dept. of Agriculture, Trade and Consumer Protection
Board Room (SR-106)
2811 Agriculture Drive
Madison, WI 53718-6777.
The public is invited to attend the hearing and make comments on the proposed rule. Additional written comments will be accepted until March 12, 2001.
A copy of this rule may be obtained free of charge, from the Wisconsin Department of Agriculture, Trade and Consumer Protection, Division of Trade and Consumer Protection, PO Box 8911, Madison, WI 53708 or by calling (608)224-4928. Copies will also be available at the public hearing.
An interpreter for the hearing impaired will be available on request for this public hearing. Please make reservations for the hearing interpreter by March 7, 2001 either by writing to Kevin LeRoy, Division of Trade and Consumer Protection, PO Box 8911, Madison, WI 53708, (608/224-4928), or TDD at (608/224-5058). Handicap access is available at the hearing.
Analysis Prepared by the Department of Agriculture, Trade and Consumer Protection
Statutory authority: ss. 93.07(1) and 93.75(3)
Statutes interpreted: s. 93.75
The legislature, in 1999 Wisconsin Act 55, created an ethanol grant program under s. 93.75, Stats. The legislature authorized the department of agriculture, trade and consumer protection (DATCP) to make grants to ethanol producers in this state. The legislature has not yet provided any funding for the grant program. This rule implements the grant program, subject to legislative funding. The ethanol grant program is scheduled to sunset on July 1, 2006.
Statutory Requirements
To be eligible for a grant under s. 93.75, Stats., an ethanol producer must produce at least 10 million gallons of ethanol in a 12-month period unless DATCP specifies a different amount by rule. The ethanol producer must also purchase commodity inputs from “local sources" as defined by DATCP rule.
Under s. 93.75, Stats., an ethanol producer is eligible for grant payments during the first 60 months of ethanol production. Subject to available funding, the legislature directed DATCP to pay 20 cents per gallon for up to 15 million gallons of eligible ethanol production per 12-month period. DATCP must adopt rules to prorate grant payments if there are not enough funds to pay all ethanol producers at the authorized statutory rate.
Rule Contents
Annual grants to ethanol producers
Under this rule, an ethanol producer may apply by April 1 of each year to receive an ethanol production grant for any consecutive 12-month period ending within a year prior to that April 1. (The applicant chooses the consecutive 12-month period.) Subject to available funding, DATCP will award to each eligible applicant a grant of 20 cents per gallon for up to 15 million gallons of “eligible ethanol" produced during the consecutive 12-month period identified in the grant application.
Eligible producer
An ethanol producer is eligible for an annual grant if all the following apply:
• The producer produced at least 10 million gallons of “eligible ethanol" during the consecutive 12-month period identified in the grant application.
• DATCP has not previously awarded a grant to the ethanol producer for ethanol produced during the consecutive 12-month period identified in the grant application.
• The ethanol producer first began producing ethanol in this state not more than 60 months prior to the end of consecutive 12-month period identified in the grant application.
Eligible ethanol
Under this rule, DATCP will make grant payments only for “eligible ethanol" production. “Eligible ethanol" means ethanol that the ethanol producer produces in this state from commodities purchased from local sources. A “commodity" includes grain and other starch or sugar crops. A “commodity purchased from a local source" means any of the following:
• A commodity that the ethanol producer purchases from a person who grew that commodity in this state.
• Grain that the ethanol producer purchases from a grain dealer and receives directly from a grain facility located in this state.
Grant application
An ethanol producer must submit a grant application in writing, on a form provided by DATCP. The application must specify all the following:
• The consecutive 12-month period for which the applicant seeks a grant.
• The total gallons of “eligible ethanol" that the applicant produced during that consecutive 12-month period.
• The name and address of each supplier from whom the applicant purchased a commodity used to produce the “eligible ethanol." The applicant must identify the type and amount of each commodity purchased from each supplier. If the applicant purchased grain from a grain dealer, the applicant must give the address of the grain facility from which the grain dealer shipped that grain to the applicant.
• The applicant's federal tax identification number.
• The date on which the applicant first produced ethanol in this state.
• Any other information required by DATCP.
DATCP action on grant applications
DATCP must award grants by June 1 of each year, and must make grant payments by June 30 (the end of the state fiscal year). If DATCP denies a grant application, or awards a smaller prorated amount (see below), DATCP must explain its action in writing.
DATCP may require an applicant to provide additional information, and may deny a grant application if the applicant fails to honor DATCP's reasonable request for relevant information. DATCP may exercise its authority under ch. 93, Stats., to verify a grant application, or to verify the applicant's eligibility for a grant.
DATCP may deny a grant application, or recover grant payments made to an applicant, if DATCP finds that the applicant has materially misrepresented any information related to a grant application.
Prorating payments
Under this rule, if grant awards in any state fiscal year exceed the grant funds appropriated for that fiscal year, DATCP must prorate grant awards based on each applicant's eligible ethanol production during the consecutive 12-month period identified in the applicant's grant application. An ethanol producer who receives a pro-rated grant may not apply for the balance of that grant in the next fiscal year.
Fiscal Estimate
This proposed rule was initiated when the legislature passed 1999 Wis. Act 55. This act created an ethanol grant program under s. 93.75, Wis. Stats. Under this program, the department is authorized to make grants to certain ethanol producers. The legislation requires the department to adopt rules for the program. Administrative costs associated with this program should be minimal and easily absorbed into the agency's general duties.
Initial Regulatory Flexibility Analysis
1999 Wis. Act 55 created an ethanol grant program under s. 93.75, Wis. Stats. Under this program, the department is authorized to make grants to certain ethanol producers. The legislation requires the department to adopt rules for the grant program.
To be eligible for a payment, the ethanol producer must produce at least ten million gallons of ethanol per year. The legislation requires the department to pay ethanol producers who meet the statutory and proposed rule criteria 20¢ per gallon for not more than 15 million gallons.
Ethanol producers may only apply for a grant payment if they have been in business for sixty months or less. The entire program is scheduled to sunset on July 1, 2006.
There is little chance that any ethanol producer who can produce the minimum ten million gallons per year would also meet the state's definition of a “small business" contained in s. 227.114(1)(a). Stats. In that statutory section, “small business" means a business entity, including its affiliates, which is independently owned and operated and is not dominant in its field, and which employs fewer than twenty-five full time employees or which has gross annual sales of less than $2,500,000. Consequently, the department expects this program to have minimal impact on small business in the ethanol production industry.
The grant program should have a major impact on the prices for agricultural crops used in the production of ethanol. By providing another market for these agricultural crops, the prices for those crops should increase. The increase in prices will benefit Wisconsin farmers. Since the grant program is designed to promote the purchase of crops grown in Wisconsin, there will be a benefit to Wisconsin small businesses derived from this program and rule.
Notice of Hearing
Financial Institutions—Securities
NOTICE IS HEREBY GIVEN that pursuant to secs. 551.32(1)(a), (b), (c), (1m), (1s) and (8), and 551.63(2), Wis. Stats., the Division of Securities of the Department of Financial Institutions will hold a public hearing at 345 West Washington Avenue, 4th floor Conference Room, at 10:00 a.m. on Wednesday, April 18, 2001 to consider the amendment and adoption of administrative rules under the Wisconsin Uniform Securities Law relating to adopting for use in Wisconsin the Investment Adviser Registration Depository.
Written comments in lieu of public hearing testimony may be submitted which must be received no later than the hearing date and should be addressed to the Administrator for the Division of Securities, 345 West Washington Avenue, PO Box 1768, Madison, Wisconsin, 53701.
Analysis Prepared by the Department of Financial Institutions, Division of Securities
Statutory Authority: Sections 551.32(1)(a), (b), (c), (1m), (1s) and (8), and 551.63(2)
Statutes Interpreted: Section 551.32(1)(a), (b), (c), (1m), (1s) and (8)
These proposed permanent rules are being implemented to be in effect upon expiration of emergency rules issued by the Division on December 26, 2000 to implement in Wisconsin, the Investment Adviser Registration Depository (“IARD"). The emergency rules became effective on January 1, 2001 upon prior publication in the official state newspaper and compliance with other emergency rulemaking requirements.
The U.S. Securities and Exchange Commission (“SEC"), in conjunction with the North American Securities Administrators Association (“NASAA"), an organization comprised of the securities administrators of all 50 states, including Wisconsin, has developed the IARD as an electronic filing system for licensure of investment advisers to replace the paper filing system which heretofore has been used in all states. The IARD system permits investment advisers to satisfy their initial and renewal filing obligations to obtain licensure under the federal and state securities laws with a single electronic filing made over the Internet, instead of having to make separate paper filings with the SEC and with each state in which the investment adviser seeks to do business.
After several years in development and a pilot phase in the fall of 2000 that the Division participated in, the commencement date for states and the SEC to accept filings under the IARD was set for January 1, 2001. Consequently, NASAA member states, including Wisconsin, needed to take the necessary rule-making or other regulatory action to enable investment advisers to make their licensing filings electronically after that date. The proposed permanent rules, as did the emergency rules, make the necessary changes to the Division's investment adviser license filing provisions that are needed to adopt and implement the IARD for use in Wisconsin by investment advisers.
The IARD will be operated by NASD Regulation, Inc., a self-regulatory organization that for 20 years has operated an equivalent electronic filing system (the Central Registration Depository or “CRD") for federal and state licensure of securities broker-dealers and their sales agents. As with the CRD, the IARD will provide the advantages of: (1) elimination of paper filings; (2) a single filing will satisfy federal and state filing requirements; and (3) automatic payment of state licensing fees to the states where the investment adviser does business. Additionally and importantly, the IARD will provide the investing public with immediate, real-time access to information about investment advisers and their representatives.
Congress in its passage of the National Securities Markets Improvement Act in 1996 provided for the development of this electronic filing system for investment advisers, and the SEC has adopted rules mandating such. The SEC and the states have been working together to develop both the necessary changes to the filing form (Form ADV), and to the filing procedures to achieve uniformity in the filing processes and procedures. Additionally, to achieve uniformity among the states in the adoption of rules implementing the IARD, a NASAA Working Group has developed Model Rules (with commentary) to coordinate with the SEC requirements. The Wisconsin Emergency Rules adopted herein are patterned after the NASAA Model Rules.
The proposed permanent rules, as did the emergency rules, provide for: (1) a revised Licensing Procedure section in DFI-Sec 5.01(1) and (2); (2) temporary and permanent hardship exemption provisions in DFI-Sec 5.01(8); (3) a revised brochure rule in DFI-Sec 5.05(8); (4) revised filing periods and license expiration dates for licenses of investment advisers and investment adviser representatives, as well as for license withdrawals in DFI-Sec 5.07 and 5.08; (5) a revised procedure for filings by federal covered advisers in DFI-Sec 5.11; and (6) a specific section in DFI-Sec 5.12 dealing with transition filings. Separate from the emergency rules and the permanent rules, the Division issued General Orders on February 1 and 2, 2001 to further implement timing for various categories of filers, and which provided partial fee rebates for 2001 for the smaller, state-only licensed advisers to help defray the initial one-time fee (of $150) they must pay for their initial participation in the IARD.
