Rule-making notices
Notice of Hearings
Agriculture, Trade and Consumer Protection
[CR 03- 121]
(Reprinted from 12/31/03 Register)
The State of Wisconsin Department of Agriculture, Trade and Consumer Protection announces that it will hold public hearings on a proposed rule related to captive wildlife and animal health. The department will hold three hearings at the time and places shown below. The department invites the public to attend the hearings and comment on the proposed rule. Following the public hearing, the hearing record will remain open until February 13, 2004, for additional written comments.
You may obtain a free copy of this rule by contacting the Wisconsin Department of Agriculture, Trade and Consumer Protection, Division of Animal Health, 2811 Agriculture Drive, P.O. Box 8911, Madison WI 53708, or by calling (608) 224-4883. Copies will also be available at the hearings.
Hearing impaired persons may request an interpreter for these hearing. Please make reservations for a hearing interpreter by January 20, 2004, by writing to Melissa Mace, Division of Animal Health, P.O. Box 8911, Madison, WI 53708-8911, telephone (608) 224-4883. Alternatively, you may contact the Department TDD at (608) 224-5058. Handicap access is available at the hearings.
Hearings are scheduled:
Thursday, January 29, 2004, 5:00 p.m. until 7:00 p.m.
WDATCP Regional Office
3610 Oakwood Hills Parkway
Eau Claire, WI 54701-7754
Handicapped accessible
Tuesday, February 3, 2004, 5:00 p.m. until 7:00 p.m.
Agriculture, Trade and Consumer Protection
Second Floor Conference Room 266
2811 Agriculture Drive
Madison, WI 53718
Handicapped accessible
Thursday, February 5, 2004, 2:00 p.m. until 4:00 p.m.
Green Bay State Office Building
200 North Jefferson Street
Room152-B
Green Bay, WI 54301
Handicapped accessible
Analysis Prepared by the Department of Agriculture, Trade and Consumer Protection
This rule does all the following:
•Implements Wisconsin's Captive Wildlife Law
(2001 Wis. Act 56), which took effect on January 1, 2003.
• Modifies related animal health rules administered by the Department of Agriculture, Trade and Consumer Protection (DATCP).
•Coordinates animal disease control activities of DATCP and the Department of Natural Resources (DNR).
Background
The Captive Wildlife Law (
2001 Wis. Act 56) strengthens and clarifies DNR regulation of captive wildlife operations. It also harmonizes DNR regulations with general animal health laws administered by DATCP. DNR's authority under the Captive Wildlife Law does not extend to “domestic animals" identified by DATCP rule.
DATCP administers Wisconsin animal health and disease control laws under chs.
93 and
95, Stats. DATCP also administers food safety laws under ch.
97, Stats., including dairy farm license requirements under s.
97.22. DATCP regulates to protect the health of humans, domestic animals and wild animals. DATCP currently does the following things, among others:
•Regulates animal imports and movement. DATCP may regulate animal imports and movement by rule, or by serving quarantine orders on the owners or custodians of affected animals. The Captive Wildlife Law clarifies that DATCP may regulate animal imports and movement to protect the health of humans, domestic animals or wild animals (not just domestic livestock).
•Licenses and inspects animal operations. DATCP licenses animal markets, animal dealers, animal truckers, dairy farms (food safety), fish farms and deer farms. Under the Captive Wildlife Law:
•DATCP now registers all deer farms, including approximately 600 captive white-tail herds previously licensed by DNR. Captive white-tail deer, like other captive deer and elk, are now classified as “farm-raised deer." DATCP is responsible for regulating deer farms. But DNR retains its authority to prescribe and enforce fencing requirements for captive white-tail deer herds.
•DATCP now licenses all animal dealers (not just livestock dealers), all animal markets (not just livestock markets) and all animal truckers (not just livestock truckers). Licensing is required for entities that handle livestock or wild animals.
•DATCP may regulate operators of game-bird farms.
•DATCP may regulate deer hunting preserves. Only deer farms registered by DATCP may operate hunting preserves. Hunting preserves must cover at least 80 acres.
•Performs animal health inspections and tests. DATCP may inspect and test animals, including but not limited to domestic livestock. This authority pre-dates the Captive Wildlife Law, and is not altered by that law.
•Examines animal health documentation. DATCP is Wisconsin's central clearinghouse for all interstate health certificates (certificates of veterinary inspection). DATCP rules require health certificates for animal imports and, in some cases, for movement of animals within Wisconsin. DATCP may require certificates for captive wild animals as well as domestic animals. Veterinarians issuing health certificates must file copies with DATCP. Under the Captive Wildlife Law, DNR may also require health certificates for wild animal imports. But the veterinarians who issue those certificates must file copies with DATCP (not DNR). DATCP then provides copies to DNR.
•Receives disease reports. Veterinarians and diagnostic laboratories that find evidence of certain animal diseases must report those findings to DATCP. DATCP rules currently specify the diseases that are reportable. DNR may ask DATCP to add wildlife diseases to the reportable disease list. Under the Captive Wildlife Law, DATCP will continue to receive all domestic and wild animal disease reports (veterinarians need not file duplicate reports with DNR). But DATCP must notify DNR of disease reports that may affect wild animals. DNR must notify DATCP whenever DNR finds evidence of a reportable disease.
•Condemns diseased animals. DATCP may condemn exposed or infected animals (including captive wild animals, as well as domestic animals) to control the spread of diseases. The Captive Wildlife Law clarifies that DATCP may condemn animals to control diseases that affect domestic animals, wild animals or humans (not just diseases affecting domestic animals). A separate legislative enactment
(2001 Act 108) authorizes DATCP to order the killing of farm-raised deer for chronic wasting disease testing, if DATCP has reason to believe that the deer have been exposed to the disease (there is no valid live test at this time).
•Pays indemnities for condemned livestock. DATCP is currently authorized to pay indemnities for condemned livestock. The Captive Wildlife Law does not change this indemnity authority (which is generally limited to livestock or food animals, including farm-raised deer). But by expanding the current definition of “farm-raised deer" to include captive white-tails, it permits indemnity payments for condemned captive white-tails. A separate legislative enactment
(2001 Act 108) also authorizes DATCP to pay indemnities for captive deer killed for chronic wasting disease testing.
Rule Contents
Official Individual Identification
Under current rules, certain animals must be identified with official individual identification. Official individual identification is often required for health certificates, disease testing and animal movement. Current rules specify acceptable forms of official individual identification. This rule authorizes the following additional forms:
•A microchip containing a unique individual identification number (the animal custodian must have a microchip reader).
•A livestock premises identification issued by DATCP, provided that the animal also bears a unique individual identification number assigned by the premises owner.
Health Certificates; Identification of Animals
Under current rules, a health certificate (certificate of veterinary inspection) is often required for the import or movement of animals. The veterinarian who issues the health certificate must identify the animals covered by the certificate. If a veterinarian issues a health certificate for bovine animals, swine, equine animals, sheep at least 6 months old, goats, ratites or cervids, the veterinarian must identify the animals by means of their official individual identification numbers (see above).
Under this rule, health certificates for alpacas, llamas and sheep under 6 months old must also include official individual identification numbers. Health certificates for other animals do not require official individual identification, but must identify the shipment source, the shipment destination, and the number and types of animals included in the shipment.
Disease Reporting
DATCP rules currently list a number of serious “reportable" diseases. Under current rules, a veterinarian or diagnostic laboratory that finds evidence of a “reportable" disease must report that disease to DATCP. This rule also requires government agencies, such as DNR, to report. Under this rule, DATCP must notify DNR if DATCP finds that a reported disease may threaten wildlife in this state, or may threaten fish in waters of the state.
Domestic Animals
DNR's authority to regulate captive wildlife does not ordinarily extend to “domestic animals" that DATCP identifies by rule. This rule defines “domestic animal" to include all of the following:
•Livestock (farm animals including bovine animals, sheep, goats, swine, farm-raised deer and equine animals).
• Farm-raised game birds, except birds that have been released to the wild.
•Farm-raised fish, except fish that have been released to waters of the state.
•Foxes, fitch, nutria, marten, fisher, mink, chinchilla, rabbit or caracul that are raised in captivity.
•Animal species (including pet species) that have been domesticated by humans.
•Pet birds.
Releasing Diseased Wild Animals
Under the Captive Wildlife Law, no person may release a temporarily possessed wild animal that has been infected with or exposed to a contagious or infectious disease unless a veterinarian first certifies to DATCP that the animal is free of the disease. This rule prohibits any person from releasing any captive wild animal that has been infected with or exposed to a contagious or infectious disease unless a veterinarian first certifies to DATCP that the animal is free of the disease.
Poultry and Farm-Raised Game Birds
•Under current DATCP rules, no poultry or poultry eggs may be sold or used for breeding or hatching purposes unless they meet certain requirements (among other things, the flock of origin must be classified as “U.S. pullorum-typhoid clean" under the National Poultry Improvement Plan). This rule applies the same requirements to farm-raised game birds and their eggs.
•Current rules spell out DATCP test procedures for determining the disease status of a poultry flock. This rule applies the same procedures to farm-raised game bird flocks.
•Under current DATCP rules, persons who keep or test poultry must report to DATCP whenever they find evidence of pullorum, fowl typhoid or other serotypes of Salmonella. This rule extends the same reporting requirement to persons who keep or test farm-raised game birds. DATCP may investigate the report.
•Under current rules, DATCP must quarantine every poultry flock that is classified as a reactor flock, infected flock or suspect flock under the National Poultry Improvement Plan. This rule extends the same quarantine requirement to flocks of farm-raised game birds.
•Current DATCP rules restrict the commingling of poultry species. This rule expands the restrictions to include farm-raised game birds.
•Under current DATCP rules, imported poultry and eggs must originate from flocks that are classified as “U.S. pullorum-typhoid clean." This rule applies the same requirement to farm-raised game birds and their eggs.
•Under current DATCP rules, imported poultry and hatching eggs must originate from flocks that comply with the National Poultry Improvement Plan (there is an exemption for poultry imported directly to slaughter). This rule applies the same requirements to farm-raised game birds and eggs.
•Under current DATCP rules, poultry exhibited at fairs and public exhibitions must originate from flocks that are “U.S. pullorum-typhoid clean," or must test negative for pullorum-typhoid. This rule applies the same requirements to farm-raised game birds and swap meets.
National Poultry Improvement Plan; Flock Enrollment
This rule establishes standards for enrolling flocks of poultry and farm-raised game birds in the National Poultry Improvement Plan. Enrollment is voluntary, but rules limit the sale and movement of birds from flocks that are not enrolled. Enrollment facilitates sales and movement within the state, and between states.
Under this rule, a flock owner may annually enroll a flock in the National Poultry Improvement Plan. Enrollment expires on June 30 of each year. The flock owner must complete an annual enrollment application that includes all the following:
•Proof that the flock has been tested for salmonella pullorum-typhoid, according to test standards set forth in the National Poultry Improvement Plan. DATCP will request permission from the Attorney General and the Revisor of Statutes to incorporate these test standards by reference in this rule.
•An annual enrollment fee. A flock owner must pay the following applicable fee:
- Fanciers. $20 if the flock consists solely of specialty breeds other than meat-type or egg-type birds, and are raised primarily for show or exhibition.
- Non-Breeders; No Game Birds. $20 if the flock owner does not handle farm-raised game birds, does not hatch or collect eggs, and buys all poultry stock from National Poultry Improvement Plan sources.
- Non-Breeders With Game Birds. $30 if the flock owner handles farm-raised game birds (with or without poultry), does not hatch or collect eggs, and buys all stock from National Poultry Improvement Plan sources.
- Breeders (With or Without Game Birds). The following applicable fee for a breeder flock (poultry or farm-raised game birds):
* $40 fee for 1 to 1,000 breeders.
* $50 fee for 1,001 to 5,000 breeders.
* $100 fee for 5,001 to 10,000 breeders.
* $200 fee for more than 10,000 breeders.
Deer Farm Registration Certificate
Under current law, a deer farm operator must hold an annual deer farm registration certificate from DATCP. Under this rule, a deer farm operator must obtain a separate certificate from DATCP to operate a hunting preserve at the registered premises (see below). This rule also clarifies that a registered deer farm operator may not operate as an animal dealer without an animal dealer license.
Deer Farms; Chronic Wasting Disease Testing
This rule clarifies current chronic wasting disease testing requirements for farm-raised deer. Under this rule, a deer farm operator must have a chronic wasting disease test performed on each of the following farm-raised deer that is at least 16 months old:
•A farm-raised deer that dies or is killed while kept by that person.
•A farm-raised deer that the person ships to slaughter.
Under current rules and this rule, the person who collects a test sample for a required chronic wasting disease test must be a certified veterinarian, a DATCP or federal employee, or a person that DATCP pre-approves in writing. The person must also complete training approved by DATCP. The person must collect the sample from the brain of the dead animal, according to standard veterinary procedures, and must submit the sample to a testing laboratory approved by DATCP and the United States department of agriculture (USDA-APHIS).
The person must normally collect the test sample before any part of the farm-raised deer carcass leaves the premises where the farm-raised deer died, or was killed or slaughtered. But a deer farm operator may separate the head from the carcass, and may ship the head to the person who collects the test sample from the brain, if the deer farm operator first identifies both the head and the carcass with official individual identification or a “dead tag" (see below).
Farm-Raised Deer; Carcass Identification
Under this rule, no person may remove any farm-raised deer carcass from a deer farm unless that carcass is identified with official individual identification, or with a “dead tag" issued by DATCP. A registered deer farm operator may purchase “dead tags" from DATCP at cost.
Under this rule, no part of a carcass may leave the premises unless every part of the carcass bears official individual identification or a dead tag, and the farm-raised deer keeper records and correlates all of the official individual identification and dead tag numbers assigned to that animal.
Deer Farm Records
This rule expands current record keeping requirements for deer farm operators. Under this rule:
•A deer farm operator must keep the following records related to each live farm-raised deer that leaves the herd other than for slaughter, or that enters the herd from another herd:
- The official individual identification of the farm-raised deer.
- The species, age and sex of the farm-raised deer.
- The date on which the farm-raised deer entered or left the herd.
- The name and address of the person from whom the person received, or to whom the person shipped, the farm-raised deer. The record shall also identify the person who had custody of the farm-raised deer during shipment.
- The address of the herd from which the farm-raised deer originated, or to which it was shipped.
- A copy of any certificate of veterinary inspection that accompanied the farm-raised deer.
•A deer farm operator must keep the following records related to each farm-raised deer that the operator ships live to slaughter:
- The official individual identification of the farm-raised deer.
- The species, age and sex of the farm-raised deer.
- The date on which the operator shipped the farm-raised deer to slaughter.
- The name and address of the slaughter facility.
- The name and address of the person who transported the farm-raised deer to slaughter.
- A copy of the slaughter movement document required under current rules (form VS-127 or equivalent).
- Chronic wasting disease test results if required (testing is currently required, unless the animal is less than 16 months old).
•A deer farm operator must keep the following records related to every farm-raised deer that dies, or is killed or slaughtered, on the deer farm premises:
- The species, age and sex of the farm-raised deer.
- Any identification attached to the farm-raised deer.
- The date on which the farm-raised deer died or was killed. If the farm-raised deer was found dead on the premises, the operator must record the date on which the farm-raised deer was found dead.
- The disposition of the carcass, regardless of whether the carcass leaves the premises. If the carcass leaves the herd premises, the operator must record the official individual identification or “dead tag" number, the disposition date, and the name and address of the carcass recipient.
- Chronic wasting disease test results if testing is required under current rules (testing is currently required, unless the animal is less than 16 months old).
•A deer farm operator must retain these records for at least 5 years, and must make the records available to DATCP for inspection and copying upon request.
Deer Imports and Movement; Tuberculosis Status
Current rules regulate imports of cervids (including farm-raised deer) to this state. This rule strengthens current import restrictions related to tuberculosis. Under this rule, no person may import a cervid except from a “tuberculosis free" or “tuberculosis qualified" herd (there are limited exemptions). Under current rules and this rule, cervids imported from “tuberculosis modified accredited states" must also be confined for tuberculosis testing following import.
Current rules also regulate the movement of farm-raised deer from deer farms in this state. This rule makes minor adjustments to current rules (timing of tuberculosis tests to determine source herd status), and exempts movements between locations that are part of the same registered deer farm.
Hunting Preserves; General
Under this rule, no person may sell or offer the opportunity to hunt farm-raised deer on any premises unless all of the following apply:
•The person holds, for those premises, both a deer farm registration certificate (see above) and a hunting preserve certificate (see below) from DATCP.
•Farm-raised deer, when hunted, have unimpeded access to at least 80 acres of land.
•The person complies with applicable requirements under this rule.
Hunting Preserve Certificate
Under this rule, DATCP may issue a hunting preserve certificate for a registered deer farm. A hunting preserve certificate expires 10 years after it is issued (the deer farm registration must be renewed annually). A hunting preserve certificate is not transferable between persons or premises. A hunting preserve certificate is not valid unless the holder also holds a current annual deer farm registration certificate.
A person must apply for a hunting preserve certificate on a form provided DATCP. The application must include all of the following:
•The applicant's name, address, and deer farm registration number.
•The address of the deer farm premises for which the applicant seeks a hunting preserve certificate.
•Documentation showing that farm-raised deer hunted on the premises will have unimpeded access to at least 80 acres of land.
•A nonrefundable fee of $150.
DATCP must grant or deny an application within 90 business days after DATCP receives a complete application. DATCP must inspect the premises before issuing a hunting preserve certificate, and may inspect relevant records as necessary.
Hunting Preserves; Chronic Wasting Disease Testing
Under this rule, a hunting preserve operator must have a chronic wasting disease test performed on every farm-raised deer at least 16 months old that is killed on the hunting preserve (see deer farm testing requirements above). The hunting preserve operator must inform the hunter of the test results.
Hunting Preserves; Animal Identification
Hunting preserves, like other deer farms, must comply with animal identification requirements (see above). Current rules prohibit any person from removing, altering or tampering with an animal's official individual identification. Under this rule, no portion of a farm-raised deer carcass may leave a hunting preserve unless it bears official individual identification or a “dead tag" issued by DATCP (see above).
Hunting Preserves; Recordkeeping
This rule requires a hunting preserve operator to do all the following:
•Keep records required of other deer farm operators.
•Keep the following records related to each farm-raised deer that is killed on the hunting preserve:
- The name and address of the person who killed the farm-raised deer.
- The date and time when the farm-raised deer was killed, and the location of the premises where it was killed.
- The name and address of the person who collected the chronic wasting disease test sample from the farm-raised deer carcass.
- The laboratory test reports from the chronic wasting disease test.
- The disposition of the carcass.
- The official individual identification or “dead tag" number attached to the carcass. If the carcass has both an official individual identification and a “dead tag," the record must include both numbers.
•Keep copies of all advertising and promotional materials used to promote the hunting preserve.
•Record the name and address of every person who pays for the opportunity to hunt farm-raised deer at the hunting preserve.
•Retain the required records for at least 5 years, and make them available to DATCP for inspection and copying upon request.
Hunting Preserves; Prohibited Conduct
Under this rule, no person operating a farm-raised deer hunting preserve may do any of the following:
•Violate or allow others to violate laws prohibiting “shining" of animals.
•Violate or assist any violation of DATCP animal health rules.
•Make any false, deceptive or misleading representation to a customer or potential customer.
•Misrepresent that DATCP or any other person has approved, endorsed or recommended a hunting preserve.
•Misrepresent the weight of a killed farm-raised deer.
•Misrepresent, to a hunter, that any portion of a carcass delivered to the hunter is that of the farm-raised deer killed by the hunter.
Animal Disease Quarantines
Under current rules, DATCP may quarantine animals to prevent or control diseases that may affect domestic or exotic animals. Under this rule, DATCP may quarantine animals to prevent or control diseases that may affect any animals (not just domestic or exotic animals), or to prevent or control diseases that may be transmitted from animals to humans.
Animal Imports; Health Certificate
Current rules prohibit a person from importing any of the following animals without a health certificate (certificate of veterinary inspection):
•Bovine animals (there are limited exemptions).
•Swine (there are limited exemptions).
•Equine animals (there are limited exemptions).
•Poultry.
•Sheep (except sheep imported to slaughter).
•Goats.
•Dogs or domestic cats.
•Circus, rodeo, racing or menagerie animals.
•Exotic ruminants and South American camelids (alpacas and llamas).
•Cervids (including deer and elk).
•Ratites (except ratites imported from a federal quarantine facility).
This rule extends the current health certificate requirement to animal species that are not covered by current rules. This rule prohibits a person from importing any animal without a health certificate. This rule continues current limited exemptions for domestic livestock, including exemptions for livestock imported directly to slaughter (farm-raised deer imported directly to slaughter must be tested for chronic wasting disease if they are at least 16 months old). This rule also exempts invertebrates that are imported in compliance with DATCP pest control rules.
Alpacas and Llamas; Imports
Under current rules, a person must obtain a DATCP permit before importing an alpaca or llama. The person must have the animal tested for tuberculosis and brucellosis. A health certificate (certificate of veterinary inspection) must accompany the imported animal. This rule eliminates the permit, tuberculosis testing and brucellosis testing requirements, but retains the health certificate requirement.
Wild Animal Imports
This rule prohibits a person from importing a wild animal to this state unless all of the following apply:
•DATCP issues an import permit for that import. DATCP may not issue an import permit for an animal that DNR has designated as a “harmful wild animal" unless DNR also approves the import.
•A valid health certificate (certificate of veterinary inspection) accompanies the imported animal.
These wild animal import requirements to not apply to invertebrates imported in compliance with DATCP pest control laws. Nor do they apply to domestic animals (see list above). However, domestic animals are subject to other import regulations under current rules and this rule.
This rule prohibits imports of prairie dogs and certain African rodents that have been implicated in the spread of “monkey pox." However, DATCP may issue an import permit if one of the following applies:
•The animal is imported directly to an accredited zoo.
•The animal is imported directly to a bona fide research facility.
•The animal is imported directly to a veterinary facility for treatment, or is returning directly from treatment at a veterinary facility.
Animal Dealers
Before the Captive Wildlife Law was enacted, DATCP licensed “livestock dealers" (“livestock" includes bovine animals, sheep, goats, swine, farm-raised deer, equines and other farm animals). The Captive Wildlife Law changed the “livestock dealer" license to an “animal dealer" license.
DATCP now licenses “animal dealers" who deal in livestock or wild animals. Captive white-tail deer are now considered “livestock" (farm-raised deer). This rule modifies current rules to reflect this expanded coverage. This rule also clarifies and reorganizes current licensing requirements. Under this rule:
•A person must be annually licensed by DATCP, as an animal dealer, if the person does any of the following (see exemptions below):
- Engages in the business of buying livestock or wild animals for resale, slaughter or exchange.
- Engages in the business of selling or exchanging livestock or wild animals.
- Engages in the business of leasing out livestock or wild animals to others.
•The following persons are exempt from licensing as animal dealers:
- An employee of a licensed animal dealer who acts solely on behalf of that licensed animal dealer.
- A farm operator who buys or exchanges livestock solely for dairy, breeding or feeding operations on that farm, or who sells only livestock produced on that farm.
- An animal market operator licensed by DATCP.
- The operator of a licensed meat establishment who buys livestock solely for slaughter at that meat establishment.
- The holder of a DNR captive wildlife license who buys, sells or exchanges wild animals pursuant to the license, solely for purposes of the licensed operation.
•A person must do all the following to obtain an animal dealer license (no change from current rules):
- Submit a complete license application.
- Pay an annual license fee of $115 (no change from current rules).
- Obtain an animal trucker license, if the person also operates as an animal trucker (see below).
- Register all vehicles that the person uses to transport animals.
- Pass a test administered by DATCP. No test is required for the renewal of an existing license.
•DATCP must grant or deny a license application within 30 business days after the applicant submits a complete application and takes any required test (no change from current rules).
•DATCP may deny, suspend or revoke a license, including violation of animal health or humane laws (no change from current rules).
•An animal dealer must do all of the following (this rule reorganizes, but does not change, current rules):
- Maintain the animal dealer premises in a clean and sanitary condition.
- Provide adequate food, water, shelter, bedding and pen space for all animals held more than 12 hours.
- Properly identify animals.
- Keep proper records.
- Handle animals in a humane manner.
- Comply with applicable requirements related to animal transport vehicles (see below).
- Refrain from commingling animals of different species within the same vehicle or enclosure.
•This rule prohibits an animal dealer from accepting delivery of animals from an unlicensed animal trucker, or shipping animals via an unlicensed animal trucker.
Animal Market Operators
Before the Captive Wildlife Law was enacted, DATCP licensed “livestock market operators" (“livestock" includes bovine animals, sheep, goats, swine, farm-raised deer, equines and other farm animals). The Captive Wildlife Law changed the “livestock market operator" license to an “animal market operator" license.
DATCP now licenses “animal market operators" who operate market facilities that are open to the public for the purpose of trading in livestock or wild animals. Captive white-tail deer are now considered “livestock" (farm-raised deer). This rule modifies current rules to reflect this expanded coverage. This rule also clarifies and reorganizes current licensing requirements. Under this rule:
•No person may operate an animal market without an annual license from DATCP. A separate license is required for each animal market (no change from current rules).
•An animal market operator may apply for a Class A, Class B or Class E animal market license (no change from current rules):
- At a class A animal market, an operator may conduct livestock and wild animal sales on any number of days during the license year.
- At a class B animal market, an operator may conduct livestock sales on no more than 4 days during the license year. An operator may not conduct wildlife sales at a class B animal market.
- At a class E animal market, an operator may conduct sales of equine animals on any number of days during the license year. An operator may not conduct sales of any other livestock or any wild animals at a class E animal market.
•A person must do all the following to obtain an animal market license (no change from current rules):
- Submit a complete license application.
- Pay an annual license fee. The fee is $225 for a class A market, $115 for a class B market, and $150 for a class E market (no change from current rules).
- Obtain an animal trucker license, if the person also operates as an animal trucker (see below).
- Register all vehicles that the person uses to transport animals.
- Pass a test administered by DATCP. No test is required for the renewal of an existing license.
•DATCP must act on a license application within 30 business days after the applicant submits a complete application and takes any required test (no change from current rules). DATCP must inspect a class A market before licensing that market for the first time. If an inspection is required, DATCP has an additional 60 days to act on the license application.
- DATCP may deny, suspend or revoke a license for cause, including violation of animal health or humane laws (no change from current rules).
•An animal market operator must do all the following (this rule reorganizes, but does not change, current rules):
- Comply with animal market construction standards.
- Keep the animal market in a clean and sanitary condition.
- Provide adequate food, water, shelter, bedding and pen space for all animals held more than 12 hours.
- Properly identify animals.
- Keep proper records.
- Handle animals in a humane manner.
- Remove animals from the animal market premises within 4 days after they enter the market (some special provisions apply).
- Comply with applicable requirements related to animal transport vehicles (see below).
- Refrain from commingling animals of different species in the same enclosure.
•This rule prohibits an animal dealer from accepting delivery of animals from an unlicensed animal trucker, or shipping animals via an unlicensed animal trucker.
Animal Truckers
Before the Captive Wildlife Law was enacted, DATCP licensed “livestock truckers" (“livestock" included bovine animals, sheep, goats, swine, farm-raised deer, equines and other farm animals). The Captive Wildlife Law changed the “livestock trucker" license to an “animal trucker" license.
DATCP now licenses “animal truckers" who transport livestock or wild animals for hire.
Captive white-tail deer are now considered “livestock" (farm-raised deer). This rule modifies current rules to reflect this expanded coverage. This rule also clarifies and reorganizes current license requirements. Under this rule:
•A person must be annually licensed by DATCP, as an animal trucker, if the person transports livestock or wild animals for hire. The following persons are exempt from licensing as animal truckers:
- An employee of a licensed animal trucker who transports animals solely on behalf of the license holder, in vehicles registered by the license holder.
- Persons who are solely engaged in transporting their own animals.
- Persons who are solely engaged in the following activities:
* Hauling animals on an occasional basis for persons participating in a livestock exhibition, fair, trail ride, youth livestock event or similar activity.
* Hauling animals on an incidental basis in connection with another business, such as a veterinary practice or a stable operation, does not ordinarily involve the sale of animals.
* Hauling animals for other persons fewer than 6 times per year.
•A person must do all the following to obtain a license (no change from current rules):
- Submit a complete license application.
- Pay license fees. There is a basic annual fee of $30, plus a $10 fee for each vehicle used to transport livestock or wild animals (no fee change from current rules).
- Register all vehicles used to transport livestock or wild animals.
- Pass a test administered by DATCP. No test is required for the renewal of an existing license.
•DATCP must act on a license application within 30 business days after the applicant submits a complete application and takes any required test (no change from current rules).
•DATCP may deny, suspend or revoke a license for cause, including violation of animal health or humane laws (no change from current rules).
•An animal trucker must do all of the following (this rule reorganizes, but does not change, current rules):
- Maintain properly equipped vehicles.
- Properly identify animals.
- Keep proper records.
- Transport and handle animals in a safe and humane manner.
•An animal trucker may not:
- Commingle different animal species on the same transport vehicle.
- Transport diseased or downer animals with healthy animals on the same transport vehicle (there is a limited exception for slaughter shipments).
Animal Transport Vehicles
Under current rules and this rule, an animal dealer, animal market operator or animal trucker must register every vehicle that the person uses to transport livestock or wild animals. The operator must register annually and pay an annual fee of $10 per vehicle. DATCP must grant or deny a registration application within 30 business days after the person submits a complete application.
Under current rules and this rule, the following requirements apply to every vehicle that an animal dealer, animal market operator or animal trucker uses to transport livestock or wild animals:
•The vehicle must be properly identified with the operator's name and business address, the operator's DATCP license number(s), and the DATCP vehicle registration number.
•The vehicle must be properly constructed and equipped to handle each type of animal transported.
•The vehicle must be kept in a clean and sanitary condition.
Fiscal Estimate
The rule will not have a major impact on State or Local government resources. This rule;
1) Implements Wisconsin's Captive Wildlife Law (
2001 Wis. Act 56), which took effect on January 1, 2003.
2) Modifies related animal health rules administered by the Department of Agriculture, Trade and Consumer Protection (DATCP).
3) Coordinates animal disease control activities of DATCP and the Department of Natural Resources (DNR).
Some of these changes will increase the workload in the department, however it is anticipated that the workload generated can be absorbed.
Initial Regulatory Flexibility Analysis
This rule affects the following businesses, among others:
•Deer farmers.
•Deer hunting preserve operators.
•Persons raising poultry and farm-raised game birds.
•Persons importing animals to this state.
•Wild animal dealers, truckers and market operators.
Many of those affected are “small businesses" as defined in s.
227.114 (1) (a), Stats.
Effects on Small Business
This rule adds regulatory requirements for some businesses, but these requirements are necessary for animal disease control and not expected to impose an undue burden. The new Captive Wildlife Law mandates some of the requirements.
In some cases, this rule gives affected businesses wider latitude to choose a preferred method of compliance. This rule will benefit affected businesses by clarifying regulatory requirements, and coordinating DATCP and DNR regulation.
This rule imposes new fees related to deer hunting preserves. The new fee ($150 for a 10-year hunting preserve certificate) is modest, and is needed to defray costs of providing inspections newly mandated by the Legislature. This rule requires deer farm operators, including hunting preserve operators, to identify dead animals with “dead tags" purchased at cost from DATCP. The “dead tags" are needed for disease control and traceback, including chronic wasting disease control.
This rule codifies, but does not increase, current fees for poultry and farm-raised game bird operators that wish to participate in the National Poultry Improvement Plan. The fees are modest ($20-200, depending on flock size and type), and merely cover DATCP's cost to provide inspections and services required under the National Poultry Improvement Plan.
The rule expands current regulation of livestock truckers, dealers and markets to include entities that handle wild animals. This change was mandated by the Legislature. The change could have a substantial impact on wild animal markets, dealers and truckers, which will now have to comply with the same regulations that apply to livestock markets, dealers and truckers. However, DATCP does not believe that many “small businesses" will be affected.
This rule will require health certificates (certificates of veterinary inspection) for the import of certain animals that can now be imported without a certificate. This rule also requires persons importing wild animals to obtain a permit for DATCP (there is no charge for the permit). The new import requirements are consistent with current requirements for livestock, are needed to control serious diseases that may be spread by these animals, and which are not adequately addressed by current import controls.
This rule will add some record keeping requirements, especially for deer hunting preserves, wild animal markets, and wild animal dealers and truckers.
Steps to Assist Small Business
In some cases, this rule gives affected businesses wider latitude to choose a preferred method of compliance. For example, this rule:
•Authorizes alternative forms of “official individual identification" of animals.
•Provides more flexibility related to the timing of required tuberculosis tests.
•Makes it easier and cheaper for deer farm operators to have test samples collected for chronic wasting disease tests. Under current rules, a veterinarian must collect the samples at the herd premises. Under this rule, the deer farm operator may send the deer head to the veterinarian who collects the test sample from the brain.
This rule will benefit affected businesses by clarifying regulatory requirements, and coordinating DATCP and DNR regulation. This rule provides a “one stop" clearinghouse for animal disease reporting and health certificate filing.
Conclusion
This rule will have an impact on small business. In most cases, this rule will not have a significant adverse impact. And in some cases, it will have a positive impact. DATCP has attempted to minimize adverse effects on small business. Effects, if any, are necessary to ensure more effective control of serious animal diseases that may affect humans, domestic animals and wild animals.
Notice of Hearing
Agriculture, Trade and Consumer Protection
(Reprinted from 12/31/03 Register)
The State of Wisconsin Department of Agriculture, Trade and Consumer Protection announces that it will hold a public hearing on 2 proposed rules that do the following:
•Amend ch.
ATCP 35, Wis. Adm. Code, relating to the agricultural chemical cleanup program.
•Amend
ch.
ATCP 40, Wis. Adm. Code, relating to fertilizer tonnage fee surcharges used to fund the agricultural chemical cleanup program.
The department will hold one hearing, covering both rules, at the time and place shown below. The department invites the public to attend the hearing and comment on the proposed rules. Following the public hearing, the hearing record will remain open until January 31, 2004, for additional written comments.
You may obtain free copies of the rules by contacting the Wisconsin Department of Agriculture, Trade and Consumer Protection, Division of Agricultural Resource Management, 2811 Agriculture Drive, P.O. Box 8911, Madison WI 53708, or by calling (608) 224-4523. Copies will also be available at the hearing.
Hearing impaired persons may request an interpreter for this hearing. Please make reservations for a hearing interpreter by January 19, 2004, by writing to Judy Testolin, Division of Agricultural Resource Management, P.O. Box 8911, Madison, WI 53708-8911, telephone (608) 224-4523. Alternatively, you may contact the Department TDD at (608) 224-5058. Handicap access is available at the hearing.
The hearing is scheduled :
Thursday, January 22, 2004, 2:00 p.m. until 5:00 p.m.
Alliant Energy Center
1919 Alliant Energy Center Way
Monona – Wingra Room (Second Floor)
Madison, WI 53713
Analysis Prepared by the Department of Agriculture, Trade and Consumer Protection
Agricultural Chemical Cleanup Program (ATCP 35).
Statute Interpreted: s.
94.73, Stats.
The Department of Agriculture, Trade and Consumer Protection (DATCP) currently administers an agricultural chemical cleanup program under s.
94.73, Stats. This program is designed to clean up spills of agricultural chemicals and minimize environmental contamination. Under this program, DATCP may reimburse a portion of the eligible cleanup cost.
DATCP has adopted rules, under ch.
ATCP 35, Wis. Adm. Code, to govern this program. This rule modifies current rules. Among other things, this rule implements statutory changes enacted in
2003 Wis. Act 33 (biennial budget act).
Landspreading Soil from Cleanup Sites
In appropriate cases under current rules, a cleanup operation may include landspreading of soils contaminated with spilled fertilizers or pesticides. Landspreading may reduce the concentration of the fertilizer or pesticide, and may provide an economical and potentially useful disposal option.
This rule clarifies that a person who landspreads soil contaminated with a pesticide is, for purposes of pesticide applicator licensing and certification, engaged in the application of that pesticide. The person must be licensed and certified to spread the pesticide-contaminated soil, to the same extent as if the person were applying the pesticide.
Costs to Remove Existing Structures
In some cases, it may be necessary to remove existing structures in order to clean up a spill site. Current rules generally prohibit DATCP from reimbursing costs incurred for the removal of existing structures. But DATCP may reimburse costs to remove certain concrete or asphalt structures (containment structures, parking areas, roadways, curbs and sidewalks) if DATCP pre-approves the removal after finding that the removal is less expensive than other cleanup alternatives.
Under current rules, DATCP may also reimburse costs to remove and reinstall certain movable structures or equipment, or to replace certain fixtures (such as fences and utility lines) that were in good operating condition when removed for the cleanup.
This rule changes and clarifies the current rules. Under this rule, DATCP may reimburse all the following:
•Costs to remove any concrete or asphalt (not just the concrete or asphalt structures identified in the current rules) if DATCP pre-approves that removal after finding that it is less expensive than other cleanup alternatives. Under this rule, as under current rules, DATCP may reimburse the depreciated value of the concrete or asphalt, as well as the costs of removal and disposal. However, DATCP may not reimburse the cost of replacing the concrete or asphalt.
•Costs to install engineered barriers, to limit infiltration of existing contamination. The responsible person must agree to maintain the barrier at his or her expense.
•Temporary removal and reinstallation of a surface, structure, fixture or equipment item that is removed intact, and returned intact to its original use and approximate original location.
•The following corrective measures related to fixtures (such as fences and utility lines) that are in good condition and operating adequately when the corrective measure occurs:
* Temporary or permanent relocation.
* Removal and replacement with a new fixture of the same size and quality, including any upgrade required by law.
* Protection during a spill cleanup, through shoring or other methods.
Repeat Spills
This rule authorizes DATCP, in consultation with the agricultural chemical cleanup council, to reduce the reimbursement rate for cleanups of repeat spills. Under this rule, DATCP may reduce the reimbursement rate for a spill cleanup if DATCP has received or paid a reimbursement claim related to a prior spill at the same site.
The presumptive reimbursement rate (reduced rate) is 50%, unless DATCP finds that a larger or smaller reduction is appropriate. In determining the amount of the reduction, DATCP may consider all of the following in consultation with the agricultural chemical cleanup council:
• The type of agricultural chemical discharged.
•The nature, size and location of discharge.
•The similarity between the discharge and prior discharges.
•The number of prior discharges, and the number of prior discharges for which the department has reimbursed corrective action costs.
•The responsible person's apparent negligence, if any.
•Whether the discharge was caused by a law violation.
•Other factors that the department or the agricultural chemical cleanup council consider relevant.
Alternative Sources of Drinking Water
In some cases, spills of agricultural chemicals may impair drinking water supplies. Current rules prohibit DATCP from reimbursing well replacement costs, except that DATCP may reimburse up to $20,000 in well replacement costs if DATCP or the Department of Natural Resources (DNR) orders the well replacement.
This rule expands DATCP's authority to reimburse well replacement costs, consistent with legislative changes enacted in
2001 Wisconsin Act 16. Under this rule, DATCP may reimburse up to $50,000 in costs incurred for any of the following actions ordered by DATCP or DNR:
•Replacement or restoration of private wells.
•Connection to alternative water sources, whether public or private.
Contractor to Disclose Identity of Landspreading Subcontractor
Current rules require contractors to disclose certain information in bids for cleanup services. This rule requires a contractor to disclose, in every bid that includes landspreading services, the name of the subcontractor (if any) who will provide those services.
Noncompetitive Bids
Under current rules, if DATCP finds that a bid for cleanup services is unreasonable, or that the cleanup service is unnecessary, DATCP may disapprove the bid, require additional bids or reimburse a lesser amount. This rule authorizes DATCP to take the same actions if DATCP finds that bids appear to be noncompetitive.
Payment Schedule
Under current rules, DATCP must pay cleanup reimbursement claims in installments if the cleanup fund balance is less than $1 million. DATCP may pay an initial installment of up to $50,000. DATCP may not make any additional payment to a claimant in any fiscal year until DATCP has paid initial installments to all eligible claimants in that year. This may delay full reimbursement to some claimants, even when adequate funds are available to pay all eligible claimants. DATCP must pay interest on any delayed payments. This rule changes the current method of payment. Under this rule, DATCP may pay the full amount of reimbursement claims on a first-come, first-served basis (there is no $50,000 installment limit). This will allow DATCP to pay claims more quickly, and limit interest costs to the agricultural chemical cleanup fund.
Reimbursement Rate
Under current rules, DATCP reimburses 80% of eligible cleanup costs. There is a minimum cleanup cost “deductible" of $3,000 or $7,500 (depending upon the type of business doing the cleanup), and DATCP does not reimburse costs to the extent that they exceed $400,000. The maximum allowed payment per cleanup, including interest on delayed payments, is $317,600 or $314,000 (depending on the applicable “deductible").
This rule reduces the current reimbursement rate, consistent with legislation enacted in
2003 Wisconsin Act 33. Under this rule, DATCP will reimburse 75% of eligible cleanup costs incurred on or after January 1, 2004. There will still be a minimum cleanup cost “deductible" of $3,000 or $7,500 (depending upon the type of business doing the cleanup). DATCP will still not reimburse costs to the extent that they exceed $400,000. The maximum allowed payment per cleanup will be $297,750 or $294,375 (depending on the applicable “deductible").
Repeal of Obsolete Provisions
This rule repeals obsolete retroactivity provisions contained related to reimbursement claims filed with the department prior to November 1, 2000.
Fiscal Estimate
DATCP estimates that this rule will save $180,000 for the agricultural chemical cleanup fund each year. This includes the following projected savings:
•By lowering the cleanup cost reimbursement rate from 80% to 75% (as required by current law), DATCP will save approximately $160,000 each year.
•By paying reimbursement claims on a first-come, first-served basis instead of installments, DATCP will save approximately $20,000 in interest costs each year.
DATCP estimates that it will save an additional $50,000 each year by reducing the reimbursement rate for repeat spills. But DATCP estimates that these savings will be offset, each year, by $50,000 in additional reimbursement payments related to concrete structure removal and private well replacement.
Initial Regulatory Flexibility Analysis
This rule affects businesses that clean up spills of fertilizers and pesticides in Wisconsin. Currently more than 360 businesses are involved in fertilizer or pesticide cleanups. Most of the cleanups occur at farm centers, agricultural dealerships and agricultural cooperatives. Many of these businesses are “small businesses" as defined in s.
227.114 (1) (a), Stats.
This rule will affect the reimbursement of spill cleanup costs. But this rule will not, by itself, have a major impact on small business. This rule merely implements a reimbursement rate reduction that the Legislature has already mandated. The rule changes expedite reimbursement payments, and increase reimbursement eligibility for certain cleanup costs. Small businesses will not need additional professional services to comply with this rule.
This rule will reduce reimbursement rates for repeat spills. However, businesses handling agricultural chemicals can participate in the department's Environmental Partners program to minimize their risk of repeat spills.
Environmental Assessment
DATCP has prepared an environmental assessment on this rule. You may obtain a free copy of the environmental assessment by contacting the Wisconsin Department of Agriculture, Trade and Consumer Protection, Division of Agricultural Resource Management, 2811 Agriculture Drive, P.O. Box 8911, Madison WI 53708, or by calling (608) 224-4523. Copies will also be available at the hearing.
Fertilizer Tonnage Fees Used to Fund the Agricultural Chemical Cleanup Program (ATCP 40)
The department of agriculture, trade and consumer protection (DATCP) currently administers an agricultural chemical cleanup program under s.
94.73, Stats. The program is partly funded by fertilizer tonnage fee surcharges.
Fertilizer manufacturers and distributors currently pay tonnage fees and surcharges, based on their annual gross sales of fertilizer in this state. Under current rules, manufacturers pay a surcharge of 38 cents per ton to fund the agricultural chemical cleanup program. This rule increases the surcharge to 86 cents per ton, as authorized by
2003 Wis. Act 33. The new surcharge will apply to fertilizer distributed after July 1, 2004, with initial payment due in August 2005.
This rule also updates current rules to reflect fee changes made by
1999 Wisconsin Act 9 (DATCP has already changed its fee collections according to reflect the statutory changes). The statutory changes decreased the basic fertilizer inspection fee by 2 cents per ton, and added a fertilizer weights and measures inspection fee of 2 cent per ton.
Fiscal Estimate
This rule will increase fertilizer tonnage fee revenues deposited to the agricultural chemical cleanup fund. The increased fee revenues will help finance the reimbursement of agricultural chemical spill cleanup costs, and reduce a projected deficit in the fund. In recent years, the fund has expended from $3.6 to $3.9 million per year in reimbursement payments, whole generating only $2,614,000 in annual revenues.
The fund had a substantial reserve until recently, but that reserve dropped below $200,000 at the end of FY 2002-03. Fiscal year 2003-04 is expected to end with unreimbursed claims (a deficit) of $784,000. Those claims (and associated interest expenses) must be reimbursed in subsequent years.
Initial Regulatory Flexibility Analysis
This rule affects tonnage fees paid by businesses (approximately 500) that are licensed to manufacture or distribute fertilizer in Wisconsin. This rule may indirectly affect farmers, landscape businesses and other persons who purchase and use fertilizer, to the extent that tonnage fee costs are passed on to those purchasers. Some of the affected businesses are “small businesses" as defined in s.
227.114 (1) (a), Stats.
This rule will not have a major adverse impact on small business. The rule will generate an additional $624,000 in fees on the 1,300,000 tons of fertilizer sold annually in Wisconsin. These fertilizers have an average price of more than $150 per ton. The fee increase represents a price increase of about 0.3% on an agricultural input that typically has annual price fluctuations of several percent. This rule does not add any new record keeping or reporting requirements for affected businesses.
By increasing revenues for the agricultural chemical cleanup fund, this rule will benefit businesses (including fertilizer manufacturers and distributors) who rely on the fund for reimbursement of spill cleanup costs. Cleanups often cost more than $30,000, and sometimes more than $100,000. This rule will assist small businesses by assuring adequate funding to cover up to 75% of cleanup costs (subject to a $3,000 deductible).
It will also help ensure faster payment of cleanup reimbursement claims.
Notice of Hearing
Educational Approval Board
NOTICE IS HEREBY GIVEN that pursuant to ss.
45.54 (2),
(3),
(10) (c) 4., and
227.11 (2), Stats., and interpreting ss.
45.54 (2),
(3),
(7) and
(10), Stats., the Wisconsin Educational Approval Board will hold a public hearing at the time and place indicated below to consider an order relating to the regulation of for-profit postsecondary schools; out-of-state, non-profit colleges and universities; and in-state, non-profit institutions incorporated after 1991.
Hearing Information
The public hearing will be held:
Tuesday, February 10, 2004 at 1:30 p.m.
8th Floor Board Conference Room
Department of Veterans Affairs
30 W. Mifflin Street
Madison, Wisconsin
Interested persons are invited to present information at the hearing. Persons appearing may provide oral testimony but are urged to submit facts, opinions and argument in writing. Written commentary may also be submitted without making a personal appearance by mail addressed to the Educational Approval Board, 30 W. Mifflin Street, P.O. Box 8696, Madison, WI 53708. Written comments must be received by February 9, 2004 to be included in the official record of rule-making proceedings.
Any person who has a qualifying disability as defined by the Americans with Disabilities Act that requires the meeting or materials at the meeting to be in an accessible location or format must contact the EAB at 608/266-1996 at least ten days prior to the hearing so that necessary arrangements can be made.
Analysis prepared by the Educational Approval Board
This rule will implement provisions related to the creation of a student protection fund. Enabling legislation was contained in the 2003-05 biennial budget (
2003 Wisconsin Act 33). In addition, the rule will clarify a number of existing rule provisions.
-Clarifies that the board approves schools and their programs.
The rule updates a number of outdated references to clarify that the board approves schools and the programs they offer. Although programs are comprised of a series of courses, the board does not approve these courses individually.
-Create provisions related to implementing a student protection fund.
Under current rule, a school subject to board oversight must provide a surety bond in an amount equal to 125% of unearned tuition as a condition of obtaining and retaining approval. The bond is intended to provide indemnification to any student, parent, guardian, or sponsor suffering loss or damage as a result of any fraud or false representation used in procuring enrollment, a violation of school approval and operating requirements, or the student being unable to complete a program because the school failed to perform its contractual obligation.
The board also relies on the surety bond as a measure of a school's financial stability. When applying for a bond, a surety company evaluates a school's finances and assesses the risks for failure. If a school is unable or has trouble securing a bond, it generally means there are underlying financial concerns which the board carefully considers during the approval process.
When establishing the bond level, the board relies on information that is typically included in the school's annual financial statements. Unfortunately, this information can be 12 to 18 months old by the time it is received and analyzed. As a result, bond levels are not always sufficient to fully protect students being served and their sponsors.
For new schools, it is even more challenging to set an appropriate bond level. Because no financial history exists, the board must rely on enrollment and tuition revenue projections from the prospective school. It can be a year or more before reliable data is available to know if the bond was set at an appropriate level. In the past, there have been schools that have closed during this critical “start-up" period and students (and their sponsors) have not been fully protected by the bond.
In an attempt to better protect students, the 2003-05 state budget (
2003 Wisconsin Act 33) included a provision authorizing the board to create a student protection fund. The fund would become the primary mechanism for providing protection to students in catastrophic situations in which a school closes.
This rule requires schools subject to board oversight to pay a new fee equal to $0.50 per $1,000 of adjusted gross annual school revenue (AGASR). The AGASR refers to the amount of revenue remaining after subtracting from gross annual school revenues the amount of refunds actually made to Wisconsin students or their sponsors during the same fiscal year for which the school reported the gross annual school revenues.
The fees generated will be placed into a newly created student protection appropriation. To the extent that the surety bond is unable to fully cover the losses incurred by a student or sponsor when a school closes, the board would be permitted to authorize the full or partial payment of those losses from the student protection appropriation.
Once funding in the student protection appropriation reaches $1.0 million, the fee assessment for schools will no longer be imposed, as required by state statute.
The rule also specifies that unexpended general operating revenues received by the board shall be transferred to the student protection appropriation, except that the board could retain unexpended revenues up to 20 percent of its annual operating budget to manage cash flow variances and unanticipated revenue reductions. Because the board in entirely funded by program revenues, this will help ensure that approved schools do not incur unanticipated fee increases.
-Amend surety bond requirements as a result of creating a student protection fund.
The student protection fund will allow the board to better protect students and their sponsors in school closure situations. Under the student protection fund, the risk of any one school closing will be spread across the more than 125 schools the board approves. At the same time, the student protection fee paid will be more equitable, reflecting not only a school's level of risk but also its ability to pay the fee.
In response to creating the student protection fund, the board will modify the current requirements for surety bonds. Instead of requiring schools to obtain a bond equal to 125 percent of unearned tuition, the board will require schools to carry a fixed bond of $25,000 or 125% of unearned tuition, whichever is less. The rule retains current provisions that allow the board to reduce these bonds if certain criteria are met. However, the rule specifies that no bond could be less than $1,000, or an amount equal to $2,000 for each representative, if any, the school employs. The overall impact of reducing the surety bond levels will more than offset increases from the student protection fee.
-Clarify the instructor qualifications required by the EAB.
Under current rule, a school is required to provide certain information regarding its faculty and/or instructors as a condition of board approval. This rule establishes specific criteria regarding the qualifications faculty members and/or instructors must possess.
-Clarify when newly approved schools are required to submit their 1st payment renewal fee.
The rule clarifies that a new school may defer its first payment renewal fee -- otherwise due no later than September 1st -- until March 1st of the following year.
Fiscal Estimate/Initial Regulatory Flexibility Analysis
This proposed administrative rule will implement the provisions contained in the 2003-05 state budget (
2003 Wisconsin Act 33) creating a student protection fund. Under the statutory provisions of the student protection fund, the Educational Approval Board (EAB) is required to develop rules for a new student protection fee. Funding generated from these fees will be placed in a separate appropriation to make payment to certain individuals who suffer a loss due to the closure of a school that has been approved by the EAB.
Under the proposed rule order, beginning in 2005, schools regulated by the EAB would pay an annual fee of $0.50 per $1,000 of school revenue. Reported school revenues for the 2004 approval year are $92.6 million. It is estimated that school revenues will increase by 10 percent in 2005 to $101.8 million. By applying the $0.50 fee to this figure, it is estimated that $50,900 will be generated in FY 05. The rule also includes a provision in which any unexpended operating revenues of the EAB exceeding a 20 percent reserve would be transferred to the fund.
While the proposed rule order imposes a new fee on schools, it will also reduce the current bonding requirements for schools. Under current rule, a school must obtain a surety bond equal to 125 percent of its unearned tuition, unless the EAB approves a reduction. For the 2004 approval year, schools will be required to obtain over $9.3 million in bond coverage. Based on rate filings with the state's Office of the Commissioner of Insurance, the average cost charged by surety companies is approximately $10 per $1,000 of needed coverage. Therefore it is assumed that the required surety bonds are currently costing schools roughly $93,000 annually.
The proposed rule will modify the surety bond requirement and specify that the maximum surety bond needed would be $25,000 or 125 percent of unearned tuition, whichever is less. This would require total bond coverage of about $2.1 million. Using the same cost information, this level of bond coverage would cost schools approximately $21,000. The resulting $72,000 in savings would offset the $50,900 of costs associated with the new fee.
The overall fiscal impact of this proposed rule on EAB-approved schools will result in estimated net savings of about $21,100. However, individual schools will be affected differently based on their specific financial circumstances. Based on an analysis of individual school information, the proposed rule will result in savings for 55 schools. Forty-four schools will experience an increase of less than $100 and 31 will incur an increase greater than $100.
Although some schools will experience a cost increase, many of them are already experiencing savings because their current bond reflects a reduction granted by the EAB. Thus, the calculated increase may not be representative of the “true savings."
As the amount of revenue generated by schools subject to EAB oversight increases, so will the fees collected under the provisions of this rule. However, under s.
45.54 (10) (cm),
Stats., the EAB is required to discontinue collecting fees to support the student protection fund during the period of time that the balance in the fund exceeds $1.0 million. Assuming that no payments are made from the student protection fund and that unexpended annual operating revenues are transferred into the fund, it is estimated that it will take nearly 10 years to reach the $1.0 million threshold. At that time, schools subject to EAB oversight would no longer be assessed a fee.
Copies of the Rule and Contact Person
Copies of this proposed rule are available from the EAB website <eab.state.wi.us> or upon request to:
Blanca James
Educational Approval Board
30 W. Mifflin Street, 9th Floor
P.O. Box 8696
Madison, Wisconsin 53708
608/266-1996
Questions regarding the rule should be directed to David Dies at 608/267-7733.
