11-1900-20056-1
STATE OF
OFFICE
OF ADMINISTRATIVE HEARINGS
FOR
THE
|
In the Matter of the Proposed Rules of the Board of Electricity
Governing Electrical Licensing and Training; |
REPORT OF THE ADMINISTRATIVE LAW JUDGE |
Administrative Law Judge Barbara L.
Neilson conducted a hearing in this rulemaking proceeding commencing at
The hearing and this Report are part of a rulemaking process
governed by the Minnesota Administrative Procedure Act.[1] The legislature has designed the rulemaking
process to ensure that state agencies have met all the requirements that
There were four members on the
Board’s hearing panel: Wendy Willson
Legge, Construction Codes and Licensing Attorney for the Department of Labor
and Industry and Attorney for the Board; James Freichels, Board Chairman; John
Schultz, Assistant Director of the Construction Codes and Licensing Division in
the Department of Labor and Industry; and Annette Trnka, Board staff
member. Thirty-seven people signed the
hearing register.
The Board and the Administrative
Law Judge received written comments on the proposed rules prior to the
hearing. After the hearing, the
Administrative Law Judge kept the administrative record open for an additional
twenty calendar days, until
NOTICE
The Board must make this Report
available for review by anyone who wishes to review it for at least five
working days before the Board takes any further action to adopt final rules or
to modify or withdraw the proposed rules.
If the Board makes changes in the rules other than those recommended in
this report, it must submit the rules, along with the complete hearing record,
to the Chief Administrative Law Judge for a review of those changes before it
may adopt the rules in final form.
After adopting the final version
of the rules, the Board must submit them to the Revisor of Statutes for a
review of their form. If the Revisor of
Statutes approves the form of the rules, the Revisor will submit certified
copies to the Administrative Law Judge, who will then review them and file them
with the Secretary of State. When they
are filed with the Secretary of State, the Administrative Law Judge will notify
the Board, and the Board will notify those persons who requested to be informed
of their filing.
Based upon all the testimony,
exhibits, and written comments, the Administrative Law Judge makes the
following:
FINDINGS OF FACT
Nature
of the Proposed Rules
1.
The
Minnesota Electrical Act, which is codified in Minnesota Statutes §§ 326B.31 to 326B.399, governs the licensure
t6r5fand registration of individuals, employers and companies that perform
electrical wiring. The prior Board of
Electricity originally adopted Minnesota Rules, Chapter 3800, relating to these
statutory requirements. In 2005,
Governor Pawlenty transferred the prior Board’s responsibilities to the
Department of Labor and Industry. In
2007, the Legislature created a new Board of Electricity and gave the Board
specific powers, including rulemaking authority in certain areas. The 2007 legislation stated that, except for
the specific powers granted to the Board of Electricity, the Commissioner of
Labor and Industry would be responsible for administering and enforcing the
provisions of the Electrical Act and any rules promulgated under that Act.[3] The 2007 legislation also created a
requirement that unlicensed individuals who perform electrical work for a
contractor or employer must register with the Department.[4]
2.
In this
rulemaking proceeding, the Board proposes to adopt amendments to the existing
rules set forth in Chapter 3800 relating to licensing, registration, and
continuing education requirements. Among
other things, the proposed amendments add new definitions of “acceptable
experience” and “registered unlicensed individual”; clarify the minimum
experience and examination requirements for licensure; update statutory and
agency references in the rules; outline procedures to be followed for
unlicensed individuals to register with the Department; and require that
registered unlicensed individuals earn eight hours of continuing education
credit as a condition of renewal of their registration. The proposed rule amendments modify the
existing rules to reflect the separation of duties between the Board and the
Department. In addition, technical
changes are proposed to conform the terminology used in existing Chapter 3800
with that used in the Electrical Act.[5]
Rulemaking
Legal Standards
3.
Under
4.
The
question of whether a rule has been shown to be reasonable focuses on whether
it has been shown to have a rational basis, or whether it is arbitrary, based
upon the rulemaking record.
5.
Reasonable
minds might be divided about the wisdom of a certain course of action. An agency is legally entitled to make choices
between possible approaches so long as its choice is rational. It is not the role of the Administrative Law
Judge to determine which policy alternative presents the “best” approach, since
this would invade the policy-making discretion of the agency. The question is, rather, whether the choice
made by the agency is one that a rational person could have made.[12]
6.
In
addition to need and reasonableness, the Administrative Law Judge must also
assess whether the Board complied with the rule adoption procedure, whether the
rule grants undue discretion, whether the Board has statutory authority to
adopt the rule, whether the rule is unconstitutional or illegal, whether the
rule constitutes an undue delegation of authority to another entity, or whether
the proposed language is not a rule.[13]
7.
Because
the Board suggested changes to the proposed rules after original publication of
the rule language in the State Register, it is also necessary for the
Administrative Law Judge to determine if the new language is substantially
different from that which was originally proposed. The standards to determine whether changes to
proposed rules create a substantially different rule are found in Minn. Stat. §
14.05, subd. 2. The statute specifies
that a modification does not make a proposed rule substantially different if:
the differences are within the scope of the matter announced in the notice of
hearing and are in character with the issues raised in that notice; the
differences are a logical outgrowth of the contents of the notice of hearing,
and the comments submitted in response to the notice; and the notice of hearing
provided fair warning that the outcome of that rulemaking proceeding could be
the rule in question.[14]
8.
In
reaching a determination regarding whether modifications result in a rule that
is substantially different, the Administrative Law Judge is to consider whether
persons who will be affected by the rule should have understood that the
rulemaking proceeding could affect their interests; whether the subject matter
of the rule or issues determined by the rule are different from the subject
matter or issues contained in the notice of hearing; and whether the effects of
the rule differ from the effects of the proposed rule contained in the notice
of hearing.[15]
Procedural
Requirements of Chapter 14
9.
The
Minnesota Administrative Procedures Act[16] and
the rules of the Office of Administrative Hearings[17] set
forth certain procedural requirements that are to be followed during agency
rulemaking.
10.
On
11.
As
required by Minn. Stat. § 14.131, the Board asked the Commissioner of Finance
to evaluate the fiscal impact and benefit of the proposed rules on local units
of government. The Department of Finance
provided comments in a memorandum dated
12.
On
November 18, 2008, Chief Administrative Law Judge Raymond R. Krause authorized
the Board to omit the text of its proposed rules from publication in the State
Register pursuant to Minn. Stat. § 14.22, subd. 1(b).[20]
13.
On
14.
On
15.
On
16.
On
17.
The
Board received requests for a hearing from 176 people, and the hearing on the
proposed rule was held on
18.
At the
hearing, the Board placed the following documents in the record:
A.
the
Request for Comments as published in the State Register on
B.
a copy
of the proposed rules dated
C.
a copy
of a memorandum from Ryan Baumtrog, Executive Budget Officer for Minnesota
Management & Budget regarding the fiscal impacts and benefits of the
proposed rules with respect to local governments;[27]
D.
a copy
of the SONAR;[28]
E.
a copy
of the transmittal letter showing that the Board mailed a copy of the SONAR to
the Legislative Reference Library on
F.
a letter
from Chief Administrative Law Judge Raymond R. Krause authorizing omission of
the text of the proposed rule from the published dual notice;[30]
G.
the Dual
Notice as mailed and published in the State Register on
H.
a
Certificate of Accuracy of the Rulemaking Mailing List as of
I.
a
Certificate that the Dual Notice and the SONAR were mailed to certain members
of the Legislature on
J.
Certificates
reflecting that the dual notice was mailed to the Rulemaking Mailing List and
the Additional Notice List on
K.
a copy
of the Notice of Hearing that was sent on
L.
copies
of comments and hearing requests received from members of the public during the
comment period;[36]
M.
copies
of comments and hearing requests received from members of the public after the
comment period ended but before the public hearing;[37]
N.
a
description of an audit by the Department in January and February of 2009 of
satellite antenna system installations and 22 pages of photographs taken during
the audit;[38]
O.
a copy
of the Department’s Electrical License Examination Guide;[39] and
P.
a copy
of the Matrix of Individual Electrical Licensing or Registration Requirements
and Inspection Requirements for the Installation of Technology Systems by Employees
of Licensed Electrical Contractors, Technology System Contractors or Employers.[40]
19.
The
Administrative Law Judge finds that the Board has met all of the procedural
requirements under applicable law and rules.
Additional Notice
20.
Minn.
Stat. §§ 14.131 and 14.23 require that the SONAR contain a description of the
Board’s efforts to provide additional notice to persons who may be affected by
the proposed rules. The Board submitted
an additional notice plan to the Office of Administrative Hearings, which reviewed
and approved it by letter dated
21.
The
Board took action to inform the following interested and affected parties and
associations of this rulemaking process:
Associated Builders and Contractors; National Electrical Contractors
Association; Minnesota Electrical Association; certain local chapters of the
International Brotherhood of Electrical Contractors; local chapter of the
Association of Minnesota Building Officials; National Association of Elevator
Safety Authorities; Minnesota Mechanical Contractors Association; Association
of General Contractors of Minnesota; Minnesota Utility Contractors Association;
Minnesota chapter of the International Association of Electrical Inspectors;
Contract Electrical Inspector Association; Communication, Control, Alarm,
Remote, Signaling Association; Minnesota Municipal Utilities Association;
Minnesota Electronic Security and Technology Association; Builders Association
of Minnesota; Builders Association of the Twin Cities; Minnesota State Fire
Chiefs Association; Minnesota Plumbing, Heating and Cooling Contractors
Association; American Society of Plumbing Engineers – Minnesota Chapter;
American Society of Civil Engineers -Minnesota Section; Association of
Minnesota Counties; Building Owners and Managers/St. Paul; League of Minnesota
Cities; American Council of Engineering Companies of Minnesota; Minnesota Pipe
Trades Association; Minnesota State Fire Marshal Division; Minnesota Association
of Townships; North Central Electrical League; Metropolitan Council; Minnesota
Landscapers Association; all approved continuing education providers for
electrical licensing, as listed on the Department’s website; all MNSCU
technical colleges that administer electrical programs; and others who
specifically requested notice.[42]
22.
Copies
of the proposed rules, SONAR, and Dual Notice were also posted on the Board’s
webpage on the Board’s website.
23.
The
Administrative Law Judge finds that the Department has fulfilled its additional
notice requirement.
Statutory Authority
24.
As
discussed above, the Legislature has divided the rulemaking authority with
respect to electrical work between the Commissioner of Labor and Industry and
the Board of Electricity. Chapter 326B
of Minnesota Statutes gives general rulemaking authority to the Commissioner of
Labor and Industry except where the rulemaking authority is expressly
transferred to the Board.[43] In this instance, the Board and the
Department of Labor and Industry agree that the proposed rules are within the
rulemaking authority of the Board, not the Department.[44]
25.
In its
SONAR, the Board asserts that its statutory authority to adopt rules related to
licensing, registration, and continuing education is set forth in Minn. Stat.
§ 326B.32, subd. 2(a)(5) and (6).[45] Those provisions state in relevant part that
the Board has the power to:
(5) adopt
rules that regulate the licensure or
registration of electrical businesses, electrical contractors, master
electricians, journeyman electricians, Class A installer, Class B installer,
power limited technicians, and other persons who perform electrical work except
for those individuals licensed under section 326.02, subdivisions 2 and 3. The board shall adopt these rules pursuant to
chapter 14 and as provided in subdivision 6, paragraphs (d) and (e); [and]
(6) adopt
rules that regulate continuing education for individuals licensed or registered as electrical businesses,
electrical contractors, master electricians, journeyman electricians, Class A
installer, Class B installer, power limited technicians, and other persons who
perform electrical work. The board shall adopt these rules pursuant to chapter
14 and as provided in subdivision 6, paragraphs (d) and (e) . . . .[46]
26.
Minn.
Stat. § 14.125 sets certain time limits on the exercise of rulemaking
authority:
An agency shall publish a notice of intent to adopt rules or a notice
of hearing within 18 months of the effective date of the law authorizing or
requiring rules to be adopted, amended, or repealed. If the notice is not published within the
time limit imposed by this section, the authority for the rules expires. The
agency shall not use other law in existence at the time of the expiration of rulemaking
authority under this section as authority to adopt, amend, or repeal these
rules.
An agency that publishes a notice of intent to adopt rules or a notice
of hearing within the time limit specified in this section may subsequently
amend or repeal the rules without additional legislative authorization.
27.
The
Board asserts that its rulemaking authority under § 326B.32 has not expired,
for several reasons. First, the Board
argues that the proposed rules are amendments of rules adopted by the previous
Board of Electricity, and therefore § 14.125 does not apply. Second, the Board contends that § 14.125 does
not apply because the rulemaking authority in Minn. Stat. § 326B.32 is not new
rulemaking authority, but is instead a transfer of certain rulemaking authority
from the previous Board of Electricity to the current Board. It points out that the previous Board’s
rulemaking authority under Minn. Stat. § 326.241 (2006) was repealed when Minn.
Stat § 326.2415 (later renumbered § 326B.32) was enacted on
28.
The
Board published the Dual Notice of Hearing on the proposed rules in the State
Register on
29.
The
Administrative Law Judge concludes that the Board has general statutory
authority under Minn. Stat. § 326B.32, subd. 2(a)(5) and (6), to adopt rules
relating to registration of certain unlicensed persons who perform electrical
work and continuing education requirements for registered persons, and that its
exercise of rulemaking authority has not expired under Minn. Stat. §
14.125. Whether specific aspects of the
proposed rules are consistent with the statute will be discussed in more detail
below.
Impact
on Farming Operations
30.
Minn.
Stat. § 14.111 imposes an additional requirement calling for notification to be
provided to the Commissioner of Agriculture when rules are proposed that affect
farming operations. In addition, where
proposed rules affect farming operations, Minn. Stat. § 14.14, subd. 1b,
requires that at least one public hearing be conducted in an agricultural area
of the state.
31.
There is
no evidence that the proposed rules affect farming operations. Accordingly, the Administrative Law Judge
concludes that the Board was not required to notify the Commissioner of
Agriculture.
Regulatory
Analysis in the SONAR
32.
Minn.
Stat. § 14.131 requires an agency adopting rules to consider seven factors in
its Statement of Need and Reasonableness:
(1)
a description of the classes of persons who
probably will be affected by the proposed rule, including classes that will
bear the costs of the proposed rule and classes that will benefit from the
proposed rule;
(2)
the probable costs to the agency and to any other
agency of the implementation and enforcement of the proposed rule and any
anticipated effect on state revenues;
(3)
a determination of whether there are less costly
methods or less intrusive methods for achieving the purpose of the proposed
rule;
(4)
a description of any alternative methods for
achieving the purpose of the proposed rule that were seriously considered by
the agency and the reasons why they were rejected in favor of the proposed
rule;
(5)
the probable costs of complying with the proposed
rule, including the portion of the total costs that will be borne by identifiable
categories of affected parties, such as separate classes of governmental units,
businesses, or individuals;
(6)
the probable costs or consequences of not adopting
the proposed rule, including those costs or consequences borne by identifiable
categories of affected parties, such as separate classes of government units,
businesses, or individuals; and
(7)
an assessment of any differences between the
proposed rule and existing federal regulations and a specific analysis of the
need for and reasonableness of each difference.
33.
With
respect to the first factor, in its SONAR the Board identified the class of
persons who will be affected by the proposed rules as unlicensed individuals
who perform or wish to perform electrical work, individuals who are licensed or
plan to become licensed to perform electrical work, and electrical contractors.[50]
34.
With
respect to the second requirement regarding the probable enforcement costs to
the agency and any anticipated effect on state revenues, the Board indicated in
its SONAR that it will not incur any costs associated with the adoption of the
proposed rule because the Board has no administrative authority. The Board acknowledged that the Department
will incur additional costs associated with administering the requirements for
registration and registration renewal with respect to unlicensed individuals
who perform electrical work. The Board
stated that it anticipates that the annual registration fee of $15 for
unlicensed individuals established in Minn. Stat. § 326B.33, subd. 19(b)(2),
will offset the cost of administering the registration of unlicensed
individuals.[51]
35.
With
respect to the third requirement, the Board must determine if there are less
costly or less intrusive methods to achieve the purposes of the proposed
rules. The Board stated in its SONAR
that, “[b]ecause these rules are necessary to administer statutory
requirements, no alternatives were considered.”[52]
36.
With
respect to the fourth requirement, the Board must describe any alternative
methods it considered and the reasons they were rejected. The Board states that it considered no other
methods for achieving the purpose of the proposed rules.[53]
37.
With
respect to the fifth requirement, the Board must note the probable cost of
complying with the proposed rules. The
Board asserts that unlicensed individuals will be required to register annually
and obtain eight hours of continuing education as a condition of renewal of
their annual registration. The statute
sets the cost of the annual registration as $15. The Board indicated that the cost of
obtaining the continuing education varies.
It stated that, in some cases, apprenticeship and other training
programs would qualify for the continuing education credit and no additional
costs would be incurred by the unlicensed individual. The Board further noted that, in other cases,
membership in professional organizations would include opportunities to earn
qualifying continuing education credits at no additional cost. The SONAR indicated that the Department
sponsors training sessions that qualify for continuing education credits at a
cost of $50 for an 8-hour course, and other independent providers charged up to
$150 for an 8-hour course. Because
continuing education is required for all of the electrical license categories,
the Board stated that there are a significant number of continuing education
providers, and an adequate number of courses should be available to enable
unlicensed registered individuals to meet the requirement.[54]
38.
With
respect to the sixth factor, the Board asserts that, if the proposed rule
setting forth the requirement for continuing education for registered
unlicensed individuals is not adopted, “the necessary knowledge for unlicensed
individuals to adequately perform electrical work will not be assured.” The Board contends that “[a]dequate technical
knowledge is critical to ensure that electrical wiring is installed in
compliance with applicable safety standards” and that “[a]n adequately trained
workforce results in the efficient installation of electrical wiring, resulting
in overall cost savings to the general public.”[55]
39.
With
respect to the seventh factor, the Board asserts that nothing in the proposed
rule conflicts with federal regulations because there are no applicable federal
regulations in this area.[56]
40.
Some
individuals and organizations opposing the proposed rules questioned whether
the regulatory analysis in the SONAR was sufficient under Minn. Stat. §
14.131. For example, the Minnesota Cable
Communications Association (MCAA) asserted that the Board failed to adequately
describe the classes of persons who probably will be affected by the proposed
rule because it failed to acknowledge the impact of the continuing education
requirement on small and large
41.
The
Minnesota Nursery and Landscape Association (MNLA), which represents over 3,000
owners and operators of nursery and landscape businesses, also contended that
the Board failed to address the significant costs the rule would impose on
employers who pay for the credits, pay their workers to attend the courses, or
experience the loss of workers who will not or cannot satisfy the education
requirement.[60] MNLA further argued that the Board’s analysis
of the probable cost to implement and enforce the rule is inadequate. It disputed that the $15 registration fee
will offset administration costs, and argues that the Board’s lack of analysis
of the enforcement costs calls into question whether the rule will be
effectively enforced, or whether the rule will burden only those who comply
with the licensing rules.[61] MNLA contended that the Board has not
demonstrated that no less costly or intrusive methods for achieving the purpose
of the rule exist, maintained that the Board failed to examine alternative
methods for achieving the purpose of the proposed rule, and asserted that the
Board should have to consider less burdensome means of encouraging voluntary
participation in continuing education before it adopts this rule.[62] Greg McDonald, President of Automatic
Irrigation Inc., similarly stated that the Board ignored the cost to companies
to educate individuals who in all likelihood will never pursue a career in an
electrical field. He stated that the
Board did not accurately assess the costs or prove that they are reasonable for
small businesses.[63]
42.
In
response to these comments, the Board emphasized that the proposed rule does
not require employers to pay the cost
of continuing education for registered unlicensed individuals, and it was
reasonable for the Board to take the position that it was not necessary to include
the cost of lost wages to businesses in its analysis.[64] The Board asserted that it did not need to
analyze whether enforcement of existing rules would be a less costly and less
intrusive method for achieving the purpose of the proposed rule, because enforcement
is clearly more costly than a continuing education requirement and enforcement
is no substitute for prevention through education. The Board noted that the estimated cost of
corrections required of the companies involved in the three investigations
described by the Department during the rulemaking process was as high as
$750,000, not counting the additional costs associated with employee time
expended in conducting and responding to the Departmental investigation.[65] The Board also maintained that enforcement
costs “are impossible to estimate through reasonable effort. There is no way to know how many violations
would occur, or how much it would cost to enforce those violations.” The Board pointed out that the SONAR is
required to include certain specified information “to the extent the agency,
through reasonable effort, can ascertain this information.”[66] The Board thus contended that the SONAR
complied with Minn. Stat. § 14.131 and Minn. R. 1400.2070.[67]
43.
Although
the analysis in the SONAR could have been more thorough, the Administrative Law
Judge finds that the Board adequately considered the regulatory factors
required by Minn. Stat. § 14.131. The
Board further explained the basis for its regulatory analysis in comments by
the agency panel at the rule hearing and in its post-hearing submissions. Because the continuing education requirement
contained in the proposed rule does not require employers to bear the cost of
continuing education for employees or mandate that employees must be permitted
to attend courses during work hours, it was reasonable for the Board not to
discuss such costs. Moreover, because
some employers already provide in-house training to their unlicensed employees
and the Board’s rules would permit employers to seek approval for such training
programs, the costs associated with the proposed rules may be minimal for
certain employers. While the Board could
possibly have considered enforcement of existing requirements by the Department
as an alternative to proposing the continuing education requirement, its
analysis is not rendered inadequate by its failure to do so, particularly since
it provided information about the much higher costs associated with enforcement
at the hearing and in its written submissions.
Performance-Based
Regulation
44.
The
Administrative Procedure Act also requires that an agency describe in its SONAR
how it has considered and implemented the legislative policy supporting
performance-based regulatory systems set forth in Minn. Stat. § 14.002.[68] A performance-based rule is one that
emphasizes superior achievement in meeting the agency’s regulatory objectives
and maximum flexibility for the regulated party and the agency in meeting those
goals.[69]
45.
In its
SONAR, the Board indicated that the proposed rules implement performance-based
standards to the extent practicable. The
Board noted that the Electrical Act imposes licensure and registration
requirements for individuals, employers and companies that perform electrical
wiring and, with limited exceptions, requires individuals who perform
electrical work to either be licensed or registered. The Board also emphasized that the Electrical
Act mandates that electrical wiring, apparatus and equipment for electric
light, heat, and power, technology circuits or systems comply with the National
Electrical Code (NEC) and the National Electrical Safety Code.[70] The Board indicated that it is proposing
these amendments to Minn. Rules Chapter 3800 to meet the Electrical Act
requirements and performance-based standards.
The proposed amendments will ensure that individuals who perform
electrical work have the necessary knowledge and expertise to perform
electrical work that complies with the NEC and the National Electrical Safety
Code. The proposed amendments also
provide a method of experience verification for registered unlicensed
individuals so that the Department can properly identify individuals who
qualify to take a license examination.
The Board concludes that the amendments therefore implement
performance-based standards.[71]
46.
MNLA and
MCAA argued that the Board failed to demonstrate that the proposed rule
emphasizes superior achievement of the Board’s objectives and maximum
flexibility for the regulated party, as required by Minn. Stat. § 14.002. MNLA asserted that the Board failed to
articulate a specific and definitive purpose for the rule, and contended that
the Board has not shown that unlicensed workers have committed safety
violations or that they or
47.
The
Administrative Law Judge finds that the Board has met the requirements set
forth in § 14.131 for assessing the impact of the proposed rules, including
consideration and implementation of the legislative policy supporting
performance-based regulatory systems.
The Board has shown that the proposed rules implement state and national
electrical codes which are performance-based, and provide for experience
verification for individuals who ultimately wish to take an examination for
licensure. The continuing education
component of the proposed rules is designed to ensure that individuals who
perform electrical work have the necessary knowledge to perform that work in
compliance with applicable codes. The
comments of MNLA, MCAA, and others regarding whether the Board has adequately
demonstrated the need for and reasonableness of the proposed rules will be
further discussed below.
Consultation
with the Commissioner of Finance
48.
Under Minn. Stat. § 14.131, the Agency is also
required to “consult with the commissioner of finance to help evaluate the
fiscal impact and fiscal benefits of the proposed rule on units of local
government.”
49.
As
required, the Board consulted with the Commissioner of Finance. In a response dated
50.
The
Administrative Law Judge finds that the Board has met the requirements set
forth in Minn. Stat. § 14.131 for consulting with the Commissioner of Finance.
Compliance
Costs for Small Businesses and Cities
51.
Under
Minn. Stat. § 14.127, the Board must “determine if the cost of complying with a
proposed rule in the first year after the rule takes effect will exceed $25,000
for: (1)
any one business that has less than 50 full-time employees; or
(2) any one statutory or home rule charter city that has less than
ten full-time employees.” The Board must
make this determination before the close of the hearing record, and the
Administrative Law Judge must review the determination and approve or
disapprove it.
52.
In the
SONAR, the Board stated that it has determined that the cost of complying with
the proposed rules in the first year after they take effect will not exceed
$25,000 for any small business or small city.
The Board indicated that the costs associated with the proposed rule
amendments will fall on the individuals who register as unlicensed persons, not
small businesses or cities, since businesses and cities are not required to
reimburse employees for these costs.
Even if a small business or city chooses to reimburse costs for their
employees who register as unlicensed individuals, and chooses to let their
employees use work time to fulfill the continuing education requirements, the
Board projected that the costs would not reach $25,000 during the first year
after the rules become effective. For
example, if all 50 employees of a small business or city needed to be
registered and take eight hours of continuing education and be paid while
attending the course, the Board estimated that the total cost would be at most
$18,250 during the first year.[74]
53.
The
Administrative Law Judge finds that the Board has made the determination
required by Minn. Stat. § 14.127, subd. 1, and approves its determination that
costs of compliance for small businesses and cities will not exceed the costs
threshold established by that statute.
Analysis of the Proposed Rules
54.
This
Report is limited to discussion of the portions of the proposed rules that
received critical comment or otherwise need to be examined; it will not discuss
each comment or rule part. Persons or
groups who do not find their particular comments referenced in this Report
should know that each and every suggestion, including those made prior to the
hearing, has been carefully read and considered. Moreover, because sections of the proposed
rules were not opposed and were adequately supported by the SONAR, a detailed
discussion of each section of the proposed rules is unnecessary.
55.
The most
controversial aspect of the proposed rules is the requirement that registered
unlicensed individuals must have eight hours of continuing education credit
each year in order to renew their registration.
Many individuals and organizations commenting on the proposed rules
challenged the Board’s authority to promulgate this rule, as well as the need
for and reasonableness of the requirement.
Accordingly, this Report will focus on that portion of the proposed
rules.
56.
The
Administrative Law Judge finds that the Department has demonstrated, by an
affirmative presentation of facts, the need for and reasonableness of all rule
provisions not specifically discussed in this Report. The Administrative Law Judge also finds that
all provisions not specifically discussed are authorized by statute and there
are no other problems that would prevent the adoption of the rules.
Parts
3800.3525 and 3800.3602 of the Proposed Rules
57.
As noted
above, most of the debate during this rulemaking proceeding was spurred by the
Board’s proposal to amend the rules to require unlicensed individuals to
register and complete eight credits of continuing education a year as a
condition of renewal of their registration.
Two interrelated provisions of the proposed rules address this
requirement: parts 3800.3525 and 3800.3602.
58.
Proposed
rule part 3800.3525 provides:
3800.3525
REGISTRATION OF UNLICENSED
INDIVIDUAL
Subpart
1. Unlicensed individual registration requirement. Individuals who are 17 years of age or older,
who do not hold any class of electrical license issued by the department, and
who perform electrical work required to be performed by employees of a
contractor or employer as defined in part 3800.3550, subpart 6, must be
registered with the department.
Subp.
2. Information required on initial registration
application. Applicants for
registration must provide the following information on the initial application
form provided by the department:
A.
full
name;
B.
date of
birth;
C.
Social
Security number;
D.
home
address;
E.
a different designated address to become
public information, if the applicant wishes the home address to remain private;
F.
area
code and telephone number, if it exists;
G.
e-mail
address, if any;
H.
date of
application;
I.
class of
work being performed; and
J.
name,
address, and telephone number of employer.
Subp.
3. Duty to keep information current.
All of the information required by subpart 2 must be kept current. Registered individuals must notify the
department within 30 days of any changes in the required information.
Subp.
4. Information required to be provided by applicant for registration
renewal application. Applicants for
registration renewal must provide the following information on the renewal
application provided by the department:
A. verification of
employment by a licensed contractor or employer as defined in part 3800.3550,
subpart 6, that includes the following:
(1) names of employers during
the previous 12-month registration term;
(2) address of each employer;
(3) telephone number of each employer;
(4) dates of employment with each employer; and
(5) class of work performed for each employer; and
B. any changes to the
information required in subpart 2, items, A, B, D, E, and F.
Subp.
5. Continuing education required.
Registered unlicensed individuals must earn eight hours of continuing
education credit as a condition of renewal of their registration. Registrants who do not renew the registration
prior to 12 months after expiration must submit an initial registration
application in accordance with subpart 2.
Subp.
6. Registration card. The unlicensed individual must always carry
the registration card issued by the department when performing electrical work
and must present it to department representatives or electrical inspection
authorities upon request.[75]
59.
After
the hearing, the Board modified part 3800.3525 of the proposed rules by adding
the italicized language set forth in subpart 2, item E above. This modification was made in response to
residential privacy concerns expressed by Anthony Mendoza on behalf of the Minnesota
Cable Communications Association. In its
post-hearing submission, the MCCA noted that it approved of this modification
of the proposed rules.[76] The modification is needed and reasonable to
allow registrants the option of protecting the confidentiality of their
residential addresses, and does not result in a rule that is substantially
different from the rule as originally proposed.
60.
Greg
McDonald, President of Automatic Irrigation Inc., questioned why the Board was
requiring a social security number for registration when it does not require an
applicant for licensure to include one.[77] The Board did not respond to this concern in
its post-hearing comments. Although the
request for inclusion of a social security number on the registration form does
not constitute a defect in the proposed rules, the Board may, if it wishes,
consider modifying this provision of the rules in response to the comment. Any such modification would not constitute a
substantial change.
61.
Proposed
rule part 3800.3602, subp. 4, specifies:
The
department shall not renew the registration of a registered unlicensed
individual unless the applicant received credit for eight hours of instruction
through one or more educational programs as required by this part. Credit for an educational program may only be
used once for renewal of registration.
At least two hours of instruction must be on the NEC with the remainder
on the statutes and rules governing electrical installations, this chapter,
chapter 3801, Minnesota Statutes, sections 326B.31 to 326B.399, or technical
topics related to electrical installations and equipment.
62.
A number
of individuals and organizations expressed support for the continuing education
requirement set forth in the proposed rules.
William Majerle, Director for the Iron Range and Duluth Electrical Joint
Apprenticeship and Training Center, stated that his organization, which employs
approximately ninety apprentices and expends more than $300,000 in training
annually, supported the continuing education requirement for unlicensed persons
and asserted that all electrical workers on a job site should receive equal
training to ensure the safety of the industry and its employees.[78] The Minnesota Electrical Association, Inc.
(MEA), which represents more than 400 licensed electrical contractors,
indicated in its testimony and written submissions that it supports the
proposed rules because they would promote better training for workers and
improve safety in the workplace. The MEA
specifically supported the continuing education requirement for unlicensed
individuals.[79] In addition, the International Brotherhood of
Electrical Workers (IBEW) Local Union 292 indicated that it supported the
proposed rules, including the continuing education requirement for unlicensed
individuals, because training on the hazards of electricity and compliance with
the NEC is necessary to prevent electrocution.
Local 292 asserted that the proposed rules will increase safety for
electrical workers and the general public.[80]
63.
Numerous
individuals and groups expressed opposition to the portion of the proposed
rules requiring continuing education for registered unlicensed persons. They asserted that the Board lacks statutory
authority to require continuing education for such individuals and argued that
the Board had not shown that the proposed rules were needed and
reasonable. These concerns are discussed
in greater detail below.
Statutory
Authority
64.
A number
of those commenting on the proposed rules argued that the Board does not have
the legal authority to promulgate a rule requiring continuing education for
registered unlicensed persons.[81] For example, the Minnesota Telecom Alliance asserted
that there is no statutory support for the continuing education requirement.[82]
In addition, the Minnesota Electronic
Security and Technology Association (MNESTA) and the Satellite Broadcasting and
Communications Association of America (SBCAA) argued that the Board’s statutory
authority to promulgate rules on continuing education is limited to requiring
continuing education for licensed
individuals. SBCAA contended that the
Legislature did not intend to extend continuing education requirements to
registered unlicensed individuals and indicated that such individuals may only
perform limited tasks and are closely supervised by licensed individuals. MNESTA and Leigh Johnson of Custom
Alarm/Custom Communications, Inc., noted that a registered unlicensed individual who fails to meet the
continuing education requirement will not have his or her registration renewed
by the Board under the proposed rules and asserted that, as a result, the
employer would have no choice but to terminate the individual. They argued that this would cause potentially
burdensome unemployment issues and amounts to a “de facto licensure” of
registered unlicensed individuals.
MNESTA contends that “[o]nly regulation by licensure can bar employment
to an individual because he or she fails to meet continuing education
requirements,” and argues that the proposed rules exceed the Board’s statutory
authority because the Legislature did not intend or authorize the Board to
enact employment barriers for individuals who are not required to be
licensed. MNESTA suggested that the
language of the proposed rule be revised to require that unlicensed individuals
working in the technology and electrical industries register annually with the
Department, and specify that only individuals who wish to establish experience
credit toward licensure would need to take required continuing education
classes annually. Under the MNESTA
proposal, the consequence for failure to obtain eight hours of continuing
education annually would simply be losing credit for experience. Individuals who do not seek to establish
experience toward licensure would not be required to take continuing education
classes as a requirement for registration.[83]
65.
The
Board responded that Minn. Stat. § 326B.32, subd. 2(a)(6), grants it specific
authority to promulgate rules requiring continuing education for registered
unlicensed persons. That statute
specifies that the Board has the power to “adopt rules that regulate continuing
education for individuals licensed or
registered as electrical businesses, electrical contractors, master
electricians, journeymen electricians, Class A installer, Class B installer,
power limited technicians and other persons who perform electrical work. . . .”[84] The Board emphasized that unlicensed individuals
are the only persons required to register under the Electrical Act or the
rules. Accordingly, when the Legislature
included the words “or registered,” the Board argued that it must have been
referring to registered unlicensed persons.
Accordingly, the Board asserted that it has the requisite statutory
authority to promulgate rules requiring continuing education for registered
unlicensed persons.[85]
66.
The
Administrative Law Judge concludes that the Board has statutory authority under
Minn. Stat. § 326B.32, subd. 2(a)(6), to adopt rules regarding the registration
of unlicensed individuals and continuing education requirements applicable to
registered unlicensed persons. The
proposed rules do not require employers to terminate individuals who fail to
renew their registration; in fact, there is nothing in the proposed rules that
would preclude an employer from redefining the scope of the individual’s duties
and retaining him or her as an employee.
The Board’s proposal to broadly define the unlicensed individuals who
must register to include those who “perform electrical work required to be
performed by employees of a contractor or employer” is consistent with the
Legislature’s directive that “unlicensed individuals performing electrical work
for a contractor or employer shall register with the department in the manner
prescribed . . . .” The Board’s decision
to deny registration renewal to those registered unlicensed individuals who
fail to obtain eight hours of continuing education is a reasonable approach
that can be taken to ensure that registered persons have an incentive to comply
with the continuing education requirement.
While it is within the Board’s discretion to chose another approach,
such as the one urged by MNESTA, the proposed rules are not rendered defective
by their failure to specify a different approach. An agency is legally entitled to make choices
between possible approaches so long as its choice is rational.[86]
Need
for and Reasonableness of Continuing Education Requirement
67.
Many
individuals and organizations opposing the proposed rules argued that the Board
failed to demonstrate that the proposed continuing education requirement is
needed and reasonable. Jack MacKenzie,
superintendent of the North Oaks Golf Course, stated that the rule is not
needed to address any safety issues and that the requirement will not benefit
the industry or the public in general.[87] Ron Soukup, owner of a small landscape
irrigation business in northern
68.
In the
SONAR, the Board provided the following explanation of the reasons for the
continuing education portion of the rule:
Requiring
registered unlicensed individuals to acquire a minimum of eight hours of
continuing education will ensure that they are provided with basic electrical
theory and code training and will subsequently result in installations being
completed in compliance with required safety standards. Most technology circuit and system work is
allowed to be performed by registered unlicensed individuals who are only
provided with general supervision and not direct supervision by individuals
licensed to perform electrical work. In
these instances, it is necessary for registered unlicensed individuals to have
electrical theory and code knowledge so that their work complies with applicable
safety standards. Requiring continuing
education for registered unlicensed individuals increases the base knowledge of
individuals performing electrical work and also updates their knowledge as
codes are updated.[92]
As further evidence of the need for the proposed
rule, the SONAR noted that “[r]egistered unlicensed individuals who take
license examinations across all license classifications pass these examinations
at a rate of less than 50%. The
examinations are based on basic electrical theory and code knowledge that is
commensurate with the scope of work allowed by the license which the applicants
are seeking.”[93]
69.
Assistant
Department Director John Schultz testified at the rule hearing and also submitted
written comments about three enforcement actions taken by the Department and
Board: (1) an enforcement action that included an audit conducted
by the Department in January and February of 2009 relating to the work of one
satellite antenna system installer; (2) a 2006 enforcement action in
which a company was required to make corrections to 6,700 satellite antenna
installations; and (3) a 2003 or 2004
enforcement action relating to the State Lottery’s antenna equipment, in which
2,500 to 3,000 of the installations required corrections. All of these enforcement actions involved different
companies.[94]
70.
The
Board indicated that the purpose of the 2009 audit was to verify compliance
with applicable NEC requirements. Of the
147 installations audited, 97 or 66% had significant Code violations. The installations that were audited were selected
from a list of over 3000 installations provided by the contractor. According to the Board, individuals who
perform antenna system wiring are not required to be individually licensed, but
they are required to be employees of a licensed contractor and to be registered
if they are not individually licensed.
The Board believes that most, if not all, of the work audited was
performed by unlicensed individuals. In
the Board’s view, the high percentage of Code violations found in this audit
demonstrates that individuals performing the installations have limited
understanding of Code requirements. The
Board indicated that requiring continuing education for these individuals will ensure
that they have adequate knowledge and understanding of the NEC and other
requirements.[95]
71.
During
the hearing and in its post-hearing submissions, the Board reiterated that the
purpose of the continuing education requirement was to promote compliance with
safety standards, and noted that the SONAR had emphasized that point. The Board also stressed that the license
examination failure rate provides evidence that there is a problem with the
knowledge base of registered unlicensed persons. The Board asserted that the low passage rate
among registered persons seeking any
type of license (not just the power limited technician license) demonstrates
that the problem with the knowledge base of registered unlicensed persons is
not limited to a single portion of the industry. The Board argued that “[i]t is therefore
reasonable to conclude that a great proportion of registered unlicensed
individuals, across all license classifications, lack the knowledge needed to
comply with safety standards for electrical installations.”[96]
72.
MCCA and
MNLA objected to consideration of the Board’s 2009 audit because it was
conducted after the SONAR was drafted and the rules were proposed. MCCA argued that the Board should not have
initiated this rulemaking proceeding until it had established the circumstances
justifying the rule. By waiting until
the hearing to submit the audit into the record, MCCA asserted that the Board had
unfairly limited the public’s opportunity to review and respond to the
information.[97] MCAA asserted that, even if the audit were
considered, it did not establish the need for the continuing education
requirement but merely demonstrates a need for additional enforcement of the current
regulations. MCAA argued that the Board
has ample enforcement remedies available to specifically address license
holders whose employees violate the electrical code and contended that it is
unnecessary to adopt new industry-wide standards when the current standards are
not enforced.[98]
73.
In its
response, the Board asserted that the audit results are credible and are properly
part of the record in this rulemaking proceeding. It denied that the audit was performed in
response to prehearing comments alleging an absence of evidentiary support for
the proposed rule. Rather, the Board
indicated that the audit was conducted as part of an enforcement action
pursuant to an Administrative Order issued to DirectSAT on
74.
The
Administrative Law Judge finds that it is proper to consider the audit
information submitted by the Board as part of the record of the rulemaking
proceeding. The record in a rulemaking
proceeding includes all of the information submitted at and after the hearing
until the close of the record. The
rulemaking record consists of the jurisdictional documents submitted by the
agency; all written materials submitted by participants; a tape recording of
the hearing, or a transcript if one has been prepared; all exhibits or other
items of physical evidence; and the report of the Administrative Law Judge.[101] The Administrative Procedure Act contemplates
that the agency shall make an affirmative presentation of facts at the public
hearing establishing the need for and reasonableness of the proposed rules[102]
and shall submit the SONAR and “any written exhibits in support of the proposed
rule” into the record and present “additional oral evidence.”[103] The rules adopted by the Office of Administrative
Hearings state that the SONAR must “summarize the evidence and argument that
the agency is relying on to justify both the need for and the reasonableness of
the proposed rules,” “state how the evidence rationally relates to the choice
of action taken,” and “explain the circumstances that created the need for the
rulemaking and why the proposed rulemaking is a reasonable solution for meeting
the need.” The OAH rules further state
that the SONAR “must be sufficiently specific so that interested persons will
be able to fully prepare any testimony or evidence in favor of or in opposition
to the proposed rules.” However, the
SONAR “need not contain evidence and argument in rebuttal of evidence and
argument presented by the public.”[104]
75.
While
the statute and rules express a preference for the inclusion of supporting
evidence and argument in the SONAR where reasonably possible, the agency is not
precluded from supplementing the information contained in its SONAR during the
hearing and in its post-hearing submissions.
In this instance, the audit information was compiled after the SONAR was
issued. The information was highlighted
and discussed during the hearing, and was posted on the Board of Electricity’s
website immediately following the hearing.
Members of the public had ample opportunity to review, make inquiries,
and respond to the audit information.
76.
MNLA and
MCAA asserted that the audit did not support the need for or reasonableness of
the Board’s decision to apply the proposed continuing education rule to all registered
unlicensed individuals. MCAA contended that
the hearing testimony confirmed that other businesses working with low-voltage
power adequately train their workers to comply with the Code[105]
and maintained that there is no evidence demonstrating that industries other
than the satellite industry lack a base level of technical knowledge.[106] MCAA thus argued that the record provided no
basis for a new continuing education requirement applicable to businesses and
individuals with no record of Code violations or lack of training, and that the
proposed rule is unnecessary and unreasonable in its application to them.[107]
MNLA asserted that the instances of inadequate grounding of satellite dish
antennas cited in the audit appeared to be limited to one installer, or at
most, a narrow field of the industry, and stated that there is no evidence that
the improper installation caused any injury.
MNLA pointed out that the Board offered no showing of safety problems
with other parts of the low-voltage industry, including the landscape lighting
and irrigation industry. MNLA argues
that the Board has not demonstrated the need for an industry-wide education
requirement and the rule is therefore overbroad because it requires all
unlicensed individuals to attend education courses.[108] MNLA also argued that the Board’s distinction
between direct and general supervision does not support a need for the proposed
rule. MNLA contended that the
legislative determination that direct supervision is not required reflects the Legislature’s
judgment that this is not work that causes unsafe conditions and supports the
notion that additional education requirements are also not required. MNLA asserts that the proposed rule circumvents
that legislative judgment by requiring education for unlicensed workers.[109]
77.
Several
organizations and individuals opposing the proposed rule stated that the
continuing education requirement is unreasonable for a variety of other reasons
as well. For example, Richard Keane, on
behalf of the Minnesota Telecom Alliance (MTA), noted that recent statutory
changes have doubled the continuing education hours necessary to renew the
Power Limited Technician license and questioned the reasonableness of imposing
education costs on registered unlicensed individuals that are comparable to
those required of Power Limited Technicians.
MTA stated that there was no evidence that the registration or
continuing education requirements would improve the quality or safety of
technology system wiring or installations and asserted that most technology
installations do not expose persons or property to the hazards that exist with
high voltage electrical light and power installations.[110] MNLA, MNESTA, and Bruce Zeman expressed
concern that the continuing education requirement might mislead unlicensed
individuals into believing they have more knowledge, ability and authority than
they do.[111]
MNLA argued that the requirement in the
proposed rule that two of the eight hours focus on NEC requirements is
unreasonable. MNLA stated that the
Board’s assertion that two hours would be sufficient to provide unlicensed
workers with an understanding of the changes in the context of the entire code reflected
an unrealistic understanding of the complexity and scope of the NEC.[112]
78.
In its
post-hearing submissions, the Board noted that individuals holding electrical
licenses are required to earn 16 hours of continuing education instruction
every two years and asserted that it is reasonable to require unlicensed
individuals registered for a one-year period to obtain eight hours of
continuing education.[113] Because individuals seeking licensure must
gain experience performing electrical work to qualify for the license and
therefore will be performing electrical work as a registered unlicensed
individual for multiple years, the Board argued that it is reasonable to
require them to obtain continuing education credit.[114]
79.
The
Board also stated that, in its view, it would not be legal or reasonable to
exempt certain unlicensed individuals from the continuing education requirements
in the proposed rule or create different classifications of registration. The Board indicated that the Legislature has
created only one type of registration for all unlicensed workers and, as a
result, the Board believes that the requirements for renewal of registration
must be uniform across all types of unlicensed electrical workers. Because registered unlicensed individuals are
not restricted in the type of electrical work they perform, the Board asserted
that it is reasonable that the continuing education requirements be the same
for all registered unlicensed individuals.
The Board does not believe that it has the authority to create
sub-classifications of registered unlicensed individuals or limit the type of
work that a registered unlicensed individual can perform within the supervision
requirements of the statute. In the
Board’s view, only the Legislature can create subcategories of registered
unlicensed individuals.[115]
80.
In
response to those who argued that the continuing education requirement will
cause the unlicensed individuals to think they can perform work that they are
not qualified to perform, the Board stated that a portion of the proposed
continuing education requirement would be spent on electrical laws or technical
topics, which includes education about who is or is not qualified to perform
different types of electrical work. The Board argued that persons who receive
this education should be better informed about which individuals can perform
which types of electrical work.[116]
81.
The
Board also contended that it is reasonable to require that two hours of the
continuing education pertain to NEC requirements. The current rule regarding continuing
education for Power Limited Technician licensure requires that 25 percent of
the education pertain to the NEC. For
other licenses, 75 percent of the continuing education must relate to NEC
requirements. Accordingly, the Board
asserted that it is reasonable to require 25 percent of continuing education
units for registered unlicensed individuals to be on the NEC. The Board indicated that the NEC is amended
every three years and its provisions pertaining to low voltage work have
recently changed. The 2008 amendments to
the NEC added a new section that affects technology circuits and systems
work. The Board maintained that it is
important for individuals who perform technology circuits and systems work to
be aware of the code changes that occur on a regular basis.[117]
82.
In its
post-hearing submissions, the Board asserted that the need for continuing
education exists because the Department has found significant, repeated
problems with work performed by unlicensed individuals. The Board contended that the problems
documented in the Department’s audit of the satellite industry pose a threat to
public safety, such as the increased risk of fire during a lightning strike
where satellite antennas are not properly grounded. In other instances, the Department asserted
that the fire-resistance of buildings has been compromised by the improper
installation of technology circuits and systems wiring. The Board maintains that continuing education
for unlicensed persons is needed to reduce the likelihood of improper work by
registered unlicensed individuals. The
Board indicated that a rule requiring continuing education for unlicensed
registered persons is needed because it will ensure that individuals performing
electrical work have the knowledge necessary to properly perform that
work. The Board emphasized the value of
educating individuals who perform any electrical work, regardless of the type
of electrical work they perform. The
Board and the Department asserted that many individuals spend their entire
careers performing electrical work for an employer in a position which does not
require a license. Because individuals
can and do spend many years performing unlicensed electrical work, they
contended that it is reasonable to require those individuals to obtain
continuing education. The Board further
asserted that only registered unlicensed individuals performing the most
dangerous types of electrical work (high voltage work for which a license is
required) are subject to the requirement of direct supervision; for other registered
unlicensed individuals performing electrical work, there is merely a general
supervision requirement. Because not all
electrical work is required to be performed under the direct supervision of a
licensed individual, the Board believes that unlicensed individuals should be
required to have the same or similar continuing education as license holders.[118]
83.
The
Board asserted that the problem of defective work occurs when unlicensed
individuals perform work under general supervision and that work is not
inspected by the Department or municipality.
Most low voltage work falls into that category, including work in the satellite
installation field and the landscaping and irrigation industries. Moreover, the Board indicated that failure
rates on licensing examinations suggest that the inadequate knowledge base is
not confined to workers in the low voltage area. The Board indicated that enforcement actions
have focused on the low voltage area because high voltage work requires an
inspection. If the inspector finds a
problem, it is corrected before the installation is put into operation, and
generally the Department takes no additional enforcement action.[119]
84.
Many of
those commenting on the proposed rules expressed concern about the
reasonableness of the costs that employers would incur in connection with the
continuing education requirement. Jack
MacKenzie, superintendent of the North Oaks Golf Course, stated that his golf
course employs 27 seasonal employees. He
indicated that he will not be able to employ that same number of staff if the
new rules are implemented because of the documentation costs, program fees the
Golf Course would reimburse to its employees, and lost wages associated with
employee attendance at training sessions.[120] Joel VonHaden, owner of a small business that
employs Technology System Technicians and unlicensed individuals, opposed the
training requirement because it will increase costs to employers and lower
employee productivity.[121] Ron Soukup, owner of a small landscape
irrigation business in northern
85.
Leigh
Johnson, CEO of an alarm company in
86.
MNLA emphasized
that the Board estimates that the total cost to employers could be as much as
$10,000 when hourly wages are included in the calculation, and asserted that, for
some of its members, $10,000 could represent their annual net profit. MNLA argued that it is bad economic policy to
require small employers to incur substantial educational costs when there is no
showing that such education will result in a safer work environment.[125] MCCA stated that, “For Comcast alone, the
cost of attending eight hours of state-mandated training would run
approximately $260,000 per year, including eight hours of lost productivity to
attend the . . . training course.”[126]
87.
The
Board responded that those filing comments in opposition to the proposed rule
have grossly exaggerated the cost of complying with the rule. As noted above, the Board estimated in the
SONAR that, if a small business or city chose to pay for continuing education
costs for all 50 employees, at a wage of $200 for eight hours, the maximum wage
cost to an employer would be $10,000.
Most small businesses, however, do not employ 50 employees. Based on the $200 estimate, if a small
business decided to pay for the continuing education of five employees who wanted
to renew their registration, the cost in lost wages would not exceed $1,000.[127]
88.
Regarding
the need for seasonal employees to obtain continuing education, the Board
asserted that not all seasonal employees are required to perform electrical
work, which is a small part of the landscape industry. If the employer has little electrical work,
the employer need not ensure that every employee is trained and registered to
perform that work. The employer could be selective to avoid the need for multiple
employees to register and obtain continuing education credit. Moreover, the Board pointed out that some of
the seasonal employees might be new registrants who would not need continuing
education until they decided to renew their registration.[128]
89.
The
Board also asserted that some of the existing training provided by a business
could be incorporated into the continuing education requirement. Many of those commenting on the proposed rule
stated that they already provide training to their employees. The Board emphasized that the current
continuing education rules allow an employer to become a continuing education
provider. The Board indicated that the required
classifications for obtaining approval of training instructors are not onerous,
and projected that the cost of employers having their in-house training
certified for continuing education credit would be small. The Board stated that the proposed amendment
to rule part 3800.3603, subp. 5, would make it easier for an employer’s
in-house employees to qualify as instructors of continuing education. The Board indicated that one employee must be
a licensed power limited technician, who would qualify as an instructor to
provide the continuing education. The
Board estimated that the costs to a business that prepares its own materials
and provides its own training would not exceed $50 a student. The Board indicated that the cost to the
Department is less than $50 per student, including the Department’s staff time,
when the Department hosts eight-hour continuing education seminars.[129]
The Board emphasized that the employer could
avoid all costs by choosing not to provide the continuing education in-house, and
simply leaving it up to the unlicensed registered person to be responsible for
obtaining the credits. In the
alternative, the employer could send the employee to the Department’s
continuing education course, at a cost of $50 per student for eight hours of
continuing education.
90.
The
Administrative Law Judge concludes that the Board has adequately demonstrated
that the proposed continuing education requirement is both needed and
reasonable. The Board’s determination
that all registered unlicensed individuals should obtain continuing education
as a condition of renewal of their registration is rationally related to the
public safety goals inherent in the Electrical Act and is a permissible and
reasonable approach to increase the knowledge of unlicensed individuals and reduce
the likelihood that they will perform improper work. The requirement that two of the eight hours
of continuing education pertain to the NEC is needed and reasonable to further
unlicensed individuals’ understanding of the Code and ensure that they are
aware of relevant Code revisions. The
proposed rule is not rendered unreasonable by virtue of the costs associated
with compliance.
Compliance
and Enforcement Issues
91.
Several people
commented at the hearing that the Department’s enforcement of license
requirements is inadequate and that there is widespread disregard of the
licensing rules among the electrical industry.
They maintained that the individuals who comply with the rules find
themselves at a disadvantage compared to those who do not maintain the proper
licenses.[130]
92.
Jeff
Latterell, a Certified Irrigation Professional and Power Limited Technician,
estimated that less than 45% of those who conduct irrigation or low voltage
lighting in
93.
William
Braun, President of CCARSA, questioned whether the new requirement will be
enforced fairly and consistently because companies and individuals that dodge
current licensing requirements will continue to avoid compliance.[134] Greg McDonald, President of Automatic
Irrigation, Inc., asserted that the Department and the Board have not enforced
the licensing requirements and stated that his company cannot compete against
companies that do not adhere to the licensing requirements.[135] Bruce Zeman, president of a landscape company
in
94.
In
response, the Board asserted that the comments about lack of enforcement of
licensing rules are irrelevant, speculative and incorrect. The Board emphasized that it has no authority
over enforcement of the rules under the governing statute. Moreover, the Board contended that enforcement
actions, which take place after a violation has occurred, are not a substitute
for continuing education, which is aimed at preventing defective electrical
work. The Board maintained that
preventing defective electrical work is the best way to protect public safety
and property. Moreover, it contended
that enforcement alone, no matter how highly publicized, is not enough to
prevent faulty electrical work, and noted that the Department’s enforcement
action against DirectSAT did not prevent the problems described in the audit.[137] The Department asserted that it investigates
and takes disciplinary action against violators, and stated that the Department
and the previous Board have had three high-profile enforcement cases since 2003
which involved over 15,000 separate installations.[138]
95.
While the
allegations about lack of enforcement and noncompliance with current rules are
not directly relevant to the rules under consideration in this proceeding, the Administrative
Law Judge urges the Board and the Department to investigate the concerns that
were raised by members of the public and take appropriate action.
Class
Availability
96.
Greg
McDonald and Bruce Zeman stated that it is difficult to find relevant
continuing education courses. Mr.
McDonald indicated that the Board-sponsored training is inadequate for the
number of licensed individuals who require training and will fall far short for
the number of registered individuals.[139]
97.
The
Department responded that there are abundant resources for finding continuing
education programs. It indicated that there
are 82 entities listed on the Department’s website that have had education
programs approved for continuing education credit. The Department believes that the proposed
requirement for continuing education for all individuals who perform electrical
work can be accomplished in a reasonable and practical manner. The Department also
emphasized that the current continuing education rules allow an employer to
become a continuing education provider.
The Department asserted that the proposed amendment to part 3800.3603,
subp. 5, would make it easier for an employer’s in-house employees to qualify
as instructors of continuing education because the amendment would eliminate
the portion of the current rule that restricts the number of course credits
based on the class of license held by the instructor. The proposed amendment to subpart 5, item C, of
the rule would eliminate the current language that limits to four hours the
credit for courses taught by a technical subject expert who does not meet one
of the other instructor qualification categories.[140]
Modification
of Proposed 3800.3603
98.
Subpart
1 of proposed rule 3800.3603 (and the current rule) includes the possibility of
approval of educational programs presented through electronic media. The rule as currently written, however, does
not include the possibility that a registrant may be enrolled in such a
program. The Board has therefore proposed
that the last sentence of proposed rule 3800.3603, subp. 1 (lines 19.13 –
19.16) be modified as follows:
In
addition to the requirements of parts 3800.3600 to 3800.3603, a program
presented through electronic media that does not include real-time interaction
between the presenter and the licensee or
registrant must include an examination process that ensures a licensee or registrant has successfully
completed the program.[141]
99.
Similarly,
proposed and current rule 3800.3603, subp. 7, requires that a report of credits
earned be provided to each licensee in attendance. The Board proposes to amend the language of
that rule as well to make it clear that registrants may obtain credit for
attending continuing education programs.
As modified, the proposed rule (lines 21.1 to 21.11) would read as
follows:
Subp.
7. Report
of credits earned. Within 14 days
after presentation of an educational program for credit under part 3800.3602,
the provider shall provide a certificate of completion to each licensee or registrant in attendance and
shall forward an attendance list and original attendance sign-in document
to the board department on a form supplied by the board
department, or in a format approved by the board department. Each certificate of completion and attendance
list shall include the name of the provider, date and location of the
presentation, educational program identification that was provided to the board
department, hours of instruction or continuing education units, and the
licensee’s or registrant’s
name and license or registration
number or the last four digits of the applicant’s Social Security number. The attendance list must be typewritten and
provide a summary of each attendee’s hours for each course attended.
100.
The Administrative Law Judge concludes that the
proposed modifications to part 3800.3603, subps. 1 and 7, are needed and
reasonable to clarify the applicability of the rule to registrants. The modifications do not render the rule
substantially different from the rule as originally proposed.
Based on the
Findings of Fact, the Administrative Law Judge makes the following:
CONCLUSIONS
1.
The
Board gave proper notice of the hearing in this matter. The Board has fulfilled the procedural
requirements of Minn. Stat. § 14.14 and all other procedural requirements of
law or rule.
2.
The
Board has demonstrated its statutory authority to adopt the proposed rules, and
has fulfilled all other substantive requirements of law or rule within the
meaning of Minn. Stat. §§ 14.05, subd. 1; 14.15, subd. 3; and 14.50 (i) and
(ii).
3.
The
Board has demonstrated the need for and reasonableness of the proposed rules by
an affirmative presentation of facts in the record within the meaning of Minn.
Stat. §§ 14.14, subd. 4; and 14.50 (iii).
4.
The
amendments to the proposed rules suggested by the Board after publication of
the proposed rules in the State Register are not substantially different from
the proposed rules as published in the State Register within the meaning of
Minn. Stat. § 14.05, subd. 2, and 14.15, subd. 3.
5.
Any
Findings that might properly be termed Conclusions and any Conclusions that
might properly be termed Findings are hereby adopted as such.
6.
A
Finding or Conclusion of need and reasonableness with regard to any particular
rule subsection does not preclude and should not discourage the Board from
further modification of the proposed rules based upon this Report and an
examination of the public comments, provided that the rule finally adopted is
based upon facts appearing in this rule hearing record.
Based on the Conclusions, the
Administrative Law Judge makes the following:
RECOMMENDATION
IT IS
RECOMMENDED that the proposed rules, as modified, be adopted.
Dated:
|
s/Barbara L.
Neilson |
|
BARBARA L. NEILSON |
|
Administrative Law Judge |
Hearing Transcript Prepared by Angela D.
Sauro, RPR, Court Reporter, Kirby A. Kennedy & Associates (one volume).
[1]
[2] See Minn. Stat. § 14.15, subd. 1.
[3]
Statement of Need and Reasonableness (SONAR) at 1; Transcript of Public Hearing
(Tr.) at 15-16;
[4] See Minn. Stat. § 326B.33, subds. 12 and 13.
[5] SONAR at 1.
[6]
Minn. Stat. § 14.14, subd. 2;
[7]
Mammenga v. Dept. of Human Services,
442 N.W.2d 786 (
[8]
In re Hanson, 275 N.W.2d 790 (
[9] Greenhill v. Bailey, 519 F.2d 5, 19 (8th Cir. 1975).
[10]
Mammenga, 442 N.W.2d at 789-90; Broen Mem’l Home v.
[11] Manufactured Hous. Inst. v. Pettersen, 347 N.W.2d at 244.
[12]
Federal Sec. Adm’r v. Quaker Oats Co.,
318
[13]
[14] Minn. Stat. §14.05, subd. 2(b).
[15] Minn. Stat. § 14.05, subd. 2(c).
[16] The provisions of the Act relating to agency rulemaking are codified in Minn. Stat. §§ 14.001-14.47.
[17] The OAH rules governing rulemaking proceedings are set forth in Minnesota Rules part 1400.2000 through 1400.2240.
[18] Ex. 1.
[19] Ex. 12.
[20] Ex. 5.
[21] Ex. 11.
[22] Exs. 9-10.
[23] Ex. 6.
[24] Exs. 15-22.
[25] Ex. 1.
[26] Ex. 2.
[27] Ex. 12.
[28] Ex. 3.
[29] Ex. 4.
[30] Ex. 5.
[31] Exs. 6, 7.
[32] Ex. 8.
[33] Ex. 13.
[34] Exs. 9-11.
[35] Ex. 14.
[36] Exs. 15-22.
[37] Exs. 23-24, 28.
[38] Ex. 25.
[39] Ex. 26.
[40] Ex. 27.
[41] Exs. 8-11.
[42] SONAR at 5-6.
[43] Minn. Stat. § 326B.02, subds. 1 and 5.
[44] Tr. at 17.
[45] SONAR at 2.
[46] Minn. Stat. § 326B.32, subd. 2(a)(5) and (6) (emphasis added).
[47] SONAR at 2.
[48]
33 State Reg. 1101 (
[49] See 2007 Minn. Laws, chapter 140, article 5, section 19 (adding Minn. Stat. § 326.2415), section 33 (repealing Minn. Stat. §§ 326.01, 326.241, and 326.247) and section 32 (renumbering 326.2415 as 326B.32).
[50] SONAR at 3.
[51] SONAR at 3.
[52] SONAR at 3.
[53] SONAR at 3.
[54] SONAR at 4; Testimony of John Schultz, Tr. at 36 (cost of Department-sponsored training increased to $50 after SONAR published).
[55] SONAR at 4.
[56] SONAR at 4.
[57] Comment, March 9, 2009 (Anthony Mendoza), citing Test. of Rick Keane, Tr. 18, 31; Paul Edgett, Tr. 80-82; Bob Fitch, Tr. 92, Ron Soukup, Tr. 113-115; see also Test. of J. Freichels, Tr. 67-70.
[58]
Comment,
[59]
Comment,
[60] Comment, March 9, 2009 (Thomas Radio) at 3-4; Test. of Bob Fitch, Tr. 91-96; Test. of Jeff Lattrell, Tr. 96-101; Test. of Gerry De La Vega, Tr. 101-113; Test. of Ron Soukup, Tr. 113-117.
[61]
Comment,
[62]
Comment,
[63]
Comment,
[64]
Board Rebuttal Comment,
[65]
Board Rebuttal Comment,
[66]
[67]
Board Rebuttal Comment,
[68]
[69]
[70]
[71] SONAR at 4-5.
[72]
Comment,
[73] SONAR at 6; Ex. 12.
[74] SONAR at 6-7. In the SONAR, the Board provided the following break-down of its total cost projection: the cost of registering 50 employees would be $750 ($15 each), the maximum cost of continuing education would be $7,500 ($150 each), and the average cost for 50 employees for 8 hours of lost wages would be $10,000 ($200 each).
[75] See also Public Ex. 3 (Registration Application).
[76] MCCA Comment (March 9, 2009) at 1.
[77]
Comment,
[78] Comment,
[79]
Testimony of Gary Thaden, Tr. 27-28; Comment (John Ploetz),
[80]
Testimony of Dan McConnell, Tr. 29; Comment,
[81] See e.g., Tr. 137.
[82] Testimony of Richard Keane, Tr. 30-35; Public Ex. 1.
[83] Public Exs. 5, 6; Tr. 86-91; Comment, March
9, 2009.
[84] Emphasis added.
[85]
Board Comment,
[86]
See, e.g., Federal Sec. Adm’r v. Quaker Oats Co., 318
[87]
MacKenzie Test., Tr. 139-141; Comment,
[88]
Soukup Test., Tr. 113-123; Comment,
[89]
Comment,
[90]
Comment,
[91]
Public Ex. 5; Testimony of Russ Ernst, Tr. 86-91. See
also Comment of David Fisch, President of Security Engineering Associates,
Inc.,
[92]
SONAR at 10; Board Rebuttal Comment,
[93]
SONAR at 10. Board Rebuttal Comment,
[94] Board Rebuttal Comment, March 16, 2009, citing Schultz Test., Tr. 22, 73-74; Ex. 25.
[95] See Board Ex. 25; Schultz Test., Tr. 21-24, 74.
[96]
Board Rebuttal Comment,
[97] MCCA Comment, March 9, 2009 (Anthony Mendoza) at 5-6; MNLA Comment, March 9, 2009 (Thomas Radio) at 8 (stating January 2009 audit should not be considered because it was performed after the SONAR was published, in violation of Minn. R. 1400.2070).
[98]
Comment,
[99]
Board Rebuttal Comment,
[100]
Board Rebuttal Comment,
[101]
G.
[102]
[103]
[104]
[105] Comment, March 9, 2009 (Anthony Mendoza) at 7, citing Keane Test., Tr. 31, and Edgett Test., Tr. 80-82.
[106]
Comment,
[107]
Comment,
[108]
Comment,
[109]
MNLA Rebuttal Comment,
[110] Testimony of Richard Keane, Tr. 30-35; Public Ex. 1.
[111]
Comment, received
[112]
Rebuttal Comment,
[113]
Board Comment,
[114]
Board Comment,
[115]
Board Comment,
[116]
Board Comment,
[117]
Board Comment,
[118]
Board Comment,
[119]
Board Rebuttal Comment,
[120]
Comment,
[121]
Comment,
[122]
Comment,
[123]
Comment,
[124]
Comment, received
[125]
Comment,
[126] Ex. 22 at 8 (Comments and Request for Hearing).
[127]
Board Rebuttal Comment,
[128]
Board Comment,
[129] Board Comment, March 9, 2009 at 7; Board Rebuttal Comment, March 16, 2009 at 7-8; Department Rebuttal Comment, March 16, 2009 at 3.
[130]
See e.g., MNLA, Comment
[131]
Comment,
[132]
Comment,
[133] Tr. 102-105.
[134]
Comment,
[135]
Comment,
[136] Comment, received March1, 2009.
[137]
Board Rebuttal Comment,
[138]
Department Rebuttal Comment,
[139]
Comment,
[140]
Department Comment,
[141]
Board Comment,