Titles of Regulations: 1VAC17-10. Public Participation Guidelines (repealing 1VAC17-10-10 through 1VAC17-10-90).

1VAC17-11. Public Participation Guidelines (adding 1VAC17-11-10 through 1VAC17-11-110).

Statutory Authority: §§ 2.2-2405 and 2.2-4007.02 of the Code of Virginia.

Effective Date: January 21, 2009.

Agency Contact: Rhonda Bishton, Regulatory Coordinator, Department of General Services, Ninth St. Office Bldg., 202 North 9th Street, Suite 209, Richmond, VA 23219, telephone (804) 786-3311, FAX (804) 371-8305, or email rhonda.bishton@dgs.virginia.gov.

Summary:

The regulations comply with the legislative mandate (Chapter 321, 2008 Acts of Assembly) that agencies adopt model public participation guidelines issued by the Department of Planning and Budget by December 1, 2008. Public participation guidelines exist to promote public involvement in the development, amendment, or repeal of an agency's regulations.

This regulatory action repeals the current public participation guidelines and promulgates new public participation guidelines as required by Chapter 321 of the 2008 Acts of Assembly. Highlights of the public participation guidelines include (i) providing for the establishment and maintenance of notification lists of interested persons and specifying the information to be sent to such persons; (ii) providing for public comments on regulatory actions; (iii) establishing the time period during which public comments shall be accepted; (iv) providing that the plan to hold a public meeting shall be indicated in any notice of intended regulatory action; (v) providing for the appointment, when necessary, of regulatory advisory panels to provide professional specialization or technical assistance and negotiated rulemaking panels if a regulatory action is expected to be controversial; and (vi) providing for the periodic review of regulations.

CHAPTER 11
PUBLIC PARTICIPATION GUIDELINES

Part I
Purpose and Definitions

1VAC17-11-10. Purpose.

The purpose of this chapter is to promote public involvement in the development, amendment or repeal of the regulations of the Design-Build/Construction Management Review Board. This chapter does not apply to regulations, guidelines, or other documents exempted or excluded from the provisions of the Administrative Process Act (§ 2.2-4000 et seq. of the Code of Virginia).

1VAC17-11-20. Definitions.

The following words and terms when used in this chapter shall have the following meanings unless the context clearly indicates otherwise:

"Administrative Process Act" means Chapter 40 (§ 2.2-4000 et seq.) of Title 2.2 of the Code of Virginia.

"Agency" means the Design-Build/Construction Management Review Board, which is the unit of state government empowered by the agency's basic law to make regulations or decide cases. Actions specified in this chapter may be fulfilled by state employees as delegated by the agency.

"Basic law" means provisions in the Code of Virginia that delineate the basic authority and responsibilities of an agency.

"Commonwealth Calendar" means the electronic calendar for official government meetings open to the public as required by § 2.2-3707 C of the Freedom of Information Act.

''Negotiated rulemaking panel'' or ''NRP'' means an ad hoc advisory panel of interested parties established by an agency to consider issues that are controversial with the assistance of a facilitator or mediator, for the purpose of reaching a consensus in the development of a proposed regulatory action.

"Notification list" means a list used to notify persons pursuant to this chapter. Such a list may include an electronic list maintained through the Virginia Regulatory Town Hall or other list maintained by the agency.

"Open meeting" means any scheduled gathering of a unit of state government empowered by an agency's basic law to make regulations or decide cases, which is related to promulgating, amending or repealing a regulation.

"Person" means any individual, corporation, partnership, association, cooperative, limited liability company, trust, joint venture, government, political subdivision, or any other legal or commercial entity and any successor, representative, agent, agency, or instrumentality thereof.

"Public hearing" means a scheduled time at which members or staff of the agency will meet for the purpose of receiving public comment on a regulatory action.

"Regulation" means any statement of general application having the force of law, affecting the rights or conduct of any person, adopted by the agency in accordance with the authority conferred on it by applicable laws.

"Regulatory action" means the promulgation, amendment, or repeal of a regulation by the agency.

"Regulatory advisory panel" or "RAP" means a standing or ad hoc advisory panel of interested parties established by the agency for the purpose of assisting in regulatory actions.

"Town Hall" means the Virginia Regulatory Town Hall, the website operated by the Virginia Department of Planning and Budget at www.townhall.virginia.gov, which has online public comment forums and displays information about regulatory meetings and regulatory actions under consideration in Virginia and sends this information to registered public users.

"Virginia Register" means the Virginia Register of Regulations, the publication that provides official legal notice of new, amended and repealed regulations of state agencies, which is published under the provisions of Article 6 (§ 2.2-4031 et seq.) of the Administrative Process Act.

Part II
Notification of Interested Persons

1VAC17-11-30. Notification list.

A. The agency shall maintain a list of persons who have requested to be notified of regulatory actions being pursued by the agency.

B. Any person may request to be placed on a notification list by registering as a public user on the Town Hall or by making a request to the agency. Any person who requests to be placed on a notification list shall elect to be notified either by electronic means or through a postal carrier.

C. The agency may maintain additional lists for persons who have requested to be informed of specific regulatory issues, proposals, or actions.

D. When electronic mail is returned as undeliverable on multiple occasions at least 24 hours apart, that person may be deleted from the list. A single undeliverable message is insufficient cause to delete the person from the list.

E. When mail delivered by a postal carrier is returned as undeliverable on multiple occasions, that person may be deleted from the list.

F. The agency may periodically request those persons on the notification list to indicate their desire to either continue to be notified electronically, receive documents through a postal carrier, or be deleted from the list.

1VAC17-11-40. Information to be sent to persons on the notification list.

A. To persons electing to receive electronic notification or notification through a postal carrier as described in 1VAC17-11-30, the agency shall send the following information:

1. A notice of intended regulatory action (NOIRA).

2. A notice of the comment period on a proposed, a reproposed, or a fast-track regulation and hyperlinks to, or instructions on how to obtain, a copy of the regulation and any supporting documents.

3. A notice soliciting comment on a final regulation when the regulatory process has been extended pursuant to § 2.2-4007.06 or 2.2-4013 C of the Code of Virginia.

B. The failure of any person to receive any notice or copies of any documents shall not affect the validity of any regulation or regulatory action.

Part III
Public Participation Procedures

1VAC17-11-50. Public comment.

A. In considering any nonemergency, nonexempt regulatory action, the agency shall afford interested persons an opportunity to submit data, views, and arguments, either orally or in writing, to the agency. Such opportunity to comment shall include an online public comment forum on the Town Hall.

1. To any requesting person, the agency shall provide copies of the statement of basis, purpose, substance, and issues; the economic impact analysis of the proposed or fast-track regulatory action; and the agency's response to public comments received.

2. The agency may begin crafting a regulatory action prior to or during any opportunities it provides to the public to submit comments.

B. The agency shall accept public comments in writing after the publication of a regulatory action in the Virginia Register as follows:

1. For a minimum of 30 calendar days following the publication of the notice of intended regulatory action (NOIRA).

2. For a minimum of 60 calendar days following the publication of a proposed regulation.

3. For a minimum of 30 calendar days following the publication of a reproposed regulation.

4. For a minimum of 30 calendar days following the publication of a final adopted regulation.

5. For a minimum of 30 calendar days following the publication of a fast-track regulation.

6. For a minimum of 21 calendar days following the publication of a notice of periodic review.

7. Not later than 21 calendar days following the publication of a petition for rulemaking.

C. The agency may determine if any of the comment periods listed in subsection B of this section shall be extended.

D. If the Governor finds that one or more changes with substantial impact have been made to a proposed regulation, he may require the agency to provide an additional 30 calendar days to solicit additional public comment on the changes in accordance with § 2.2-4013 C of the Code of Virginia.

E. The agency shall send a draft of the agency's summary description of public comment to all public commenters on the proposed regulation at least five days before final adoption of the regulation pursuant to § 2.2-4012 E of the Code of Virginia.

1VAC17-11-60. Petition for rulemaking.

A. As provided in § 2.2-4007 of the Code of Virginia, any person may petition the agency to consider a regulatory action.

B. A petition shall include but is not limited to the following information:

1. The petitioner's name and contact information;

2. The substance and purpose of the rulemaking that is requested, including reference to any applicable Virginia Administrative Code sections; and

3. Reference to the legal authority of the agency to take the action requested.

C. The agency shall receive, consider and respond to a petition pursuant to § 2.2-4007 and shall have the sole authority to dispose of the petition.

D. The petition shall be posted on the Town Hall and published in the Virginia Register.

E. Nothing in this chapter shall prohibit the agency from receiving information or from proceeding on its own motion for rulemaking.

1VAC17-11-70. Appointment of regulatory advisory panel.

A. The agency may appoint a regulatory advisory panel (RAP) to provide professional specialization or technical assistance when the agency determines that such expertise is necessary to address a specific regulatory issue or action or when individuals indicate an interest in working with the agency on a specific regulatory issue or action.

B. Any person may request the appointment of a RAP and request to participate in its activities. The agency shall determine when a RAP shall be appointed and the composition of the RAP.

C. A RAP may be dissolved by the agency if:

1. The proposed text of the regulation is posted on the Town Hall, published in the Virginia Register, or such other time as the agency determines is appropriate; or

2. The agency determines that the regulatory action is either exempt or excluded from the requirements of the Administrative Process Act.

1VAC17-11-80. Appointment of negotiated rulemaking panel.

A. The agency may appoint a negotiated rulemaking panel (NRP) if a regulatory action is expected to be controversial.

B. An NRP that has been appointed by the agency may be dissolved by the agency when:

1. There is no longer controversy associated with the development of the regulation;

2. The agency determines that the regulatory action is either exempt or excluded from the requirements of the Administrative Process Act; or

3. The agency determines that resolution of a controversy is unlikely.

1VAC17-11-90. Meetings.

Notice of any open meeting, including meetings of a RAP or NRP, shall be posted on the Virginia Regulatory Town Hall and Commonwealth Calendar at least seven working days prior to the date of the meeting. The exception to this requirement is any meeting held in accordance with § 2.2-3707 D of the Code of Virginia allowing for contemporaneous notice to be provided to participants and the public.

1VAC17-11-100. Public hearings on regulations.

A. The agency shall indicate in its notice of intended regulatory action whether it plans to hold a public hearing following the publication of the proposed stage of the regulatory action.

B. The agency may conduct one or more public hearings during the comment period following the publication of a proposed regulatory action.

C. An agency is required to hold a public hearing following the publication of the proposed regulatory action when:

1. The agency's basic law requires the agency to hold a public hearing;

2. The Governor directs the agency to hold a public hearing; or

3. The agency receives requests for a public hearing from at least 25 persons during the public comment period following the publication of the notice of intended regulatory action.

D. Notice of any public hearing shall be posted on the Town Hall and Commonwealth Calendar at least seven working days prior to the date of the hearing. The agency shall also notify those persons who requested a hearing under subdivision C 3 of this section.

1VAC17-11-110. Periodic review of regulations.

A. The agency shall conduct a periodic review of its regulations consistent with:

1. An executive order issued by the Governor pursuant to § 2.2-4017 of the Administrative Process Act to receive comment on all existing regulations as to their effectiveness, efficiency, necessity, clarity, and cost of compliance; and

2. The requirements in § 2.2-4007.1 of the Administrative Process Act regarding regulatory flexibility for small businesses.

B. A periodic review may be conducted separately or in conjunction with other regulatory actions.

C. Notice of a periodic review shall be posted on the Town Hall and published in the Virginia Register.

Titles of Regulations: 1VAC17-10. Public Participation Guidelines (repealing 1VAC17-10-10 through 1VAC17-10-90).

1VAC17-11. Public Participation Guidelines (adding 1VAC17-11-10 through 1VAC17-11-110).

Statutory Authority: §§ 2.2-2405 and 2.2-4007.02 of the Code of Virginia.

Effective Date: January 21, 2009.

Agency Contact: Rhonda Bishton, Regulatory Coordinator, Department of General Services, Ninth St. Office Bldg., 202 North 9th Street, Suite 209, Richmond, VA 23219, telephone (804) 786-3311, FAX (804) 371-8305, or email rhonda.bishton@dgs.virginia.gov.

Summary:

The regulations comply with the legislative mandate (Chapter 321, 2008 Acts of Assembly) that agencies adopt model public participation guidelines issued by the Department of Planning and Budget by December 1, 2008. Public participation guidelines exist to promote public involvement in the development, amendment, or repeal of an agency's regulations.

This regulatory action repeals the current public participation guidelines and promulgates new public participation guidelines as required by Chapter 321 of the 2008 Acts of Assembly. Highlights of the public participation guidelines include (i) providing for the establishment and maintenance of notification lists of interested persons and specifying the information to be sent to such persons; (ii) providing for public comments on regulatory actions; (iii) establishing the time period during which public comments shall be accepted; (iv) providing that the plan to hold a public meeting shall be indicated in any notice of intended regulatory action; (v) providing for the appointment, when necessary, of regulatory advisory panels to provide professional specialization or technical assistance and negotiated rulemaking panels if a regulatory action is expected to be controversial; and (vi) providing for the periodic review of regulations.

CHAPTER 11
PUBLIC PARTICIPATION GUIDELINES

Part I
Purpose and Definitions

1VAC17-11-10. Purpose.

The purpose of this chapter is to promote public involvement in the development, amendment or repeal of the regulations of the Design-Build/Construction Management Review Board. This chapter does not apply to regulations, guidelines, or other documents exempted or excluded from the provisions of the Administrative Process Act (§ 2.2-4000 et seq. of the Code of Virginia).

1VAC17-11-20. Definitions.

The following words and terms when used in this chapter shall have the following meanings unless the context clearly indicates otherwise:

"Administrative Process Act" means Chapter 40 (§ 2.2-4000 et seq.) of Title 2.2 of the Code of Virginia.

"Agency" means the Design-Build/Construction Management Review Board, which is the unit of state government empowered by the agency's basic law to make regulations or decide cases. Actions specified in this chapter may be fulfilled by state employees as delegated by the agency.

"Basic law" means provisions in the Code of Virginia that delineate the basic authority and responsibilities of an agency.

"Commonwealth Calendar" means the electronic calendar for official government meetings open to the public as required by § 2.2-3707 C of the Freedom of Information Act.

''Negotiated rulemaking panel'' or ''NRP'' means an ad hoc advisory panel of interested parties established by an agency to consider issues that are controversial with the assistance of a facilitator or mediator, for the purpose of reaching a consensus in the development of a proposed regulatory action.

"Notification list" means a list used to notify persons pursuant to this chapter. Such a list may include an electronic list maintained through the Virginia Regulatory Town Hall or other list maintained by the agency.

"Open meeting" means any scheduled gathering of a unit of state government empowered by an agency's basic law to make regulations or decide cases, which is related to promulgating, amending or repealing a regulation.

"Person" means any individual, corporation, partnership, association, cooperative, limited liability company, trust, joint venture, government, political subdivision, or any other legal or commercial entity and any successor, representative, agent, agency, or instrumentality thereof.

"Public hearing" means a scheduled time at which members or staff of the agency will meet for the purpose of receiving public comment on a regulatory action.

"Regulation" means any statement of general application having the force of law, affecting the rights or conduct of any person, adopted by the agency in accordance with the authority conferred on it by applicable laws.

"Regulatory action" means the promulgation, amendment, or repeal of a regulation by the agency.

"Regulatory advisory panel" or "RAP" means a standing or ad hoc advisory panel of interested parties established by the agency for the purpose of assisting in regulatory actions.

"Town Hall" means the Virginia Regulatory Town Hall, the website operated by the Virginia Department of Planning and Budget at www.townhall.virginia.gov, which has online public comment forums and displays information about regulatory meetings and regulatory actions under consideration in Virginia and sends this information to registered public users.

"Virginia Register" means the Virginia Register of Regulations, the publication that provides official legal notice of new, amended and repealed regulations of state agencies, which is published under the provisions of Article 6 (§ 2.2-4031 et seq.) of the Administrative Process Act.

Part II
Notification of Interested Persons

1VAC17-11-30. Notification list.

A. The agency shall maintain a list of persons who have requested to be notified of regulatory actions being pursued by the agency.

B. Any person may request to be placed on a notification list by registering as a public user on the Town Hall or by making a request to the agency. Any person who requests to be placed on a notification list shall elect to be notified either by electronic means or through a postal carrier.

C. The agency may maintain additional lists for persons who have requested to be informed of specific regulatory issues, proposals, or actions.

D. When electronic mail is returned as undeliverable on multiple occasions at least 24 hours apart, that person may be deleted from the list. A single undeliverable message is insufficient cause to delete the person from the list.

E. When mail delivered by a postal carrier is returned as undeliverable on multiple occasions, that person may be deleted from the list.

F. The agency may periodically request those persons on the notification list to indicate their desire to either continue to be notified electronically, receive documents through a postal carrier, or be deleted from the list.

1VAC17-11-40. Information to be sent to persons on the notification list.

A. To persons electing to receive electronic notification or notification through a postal carrier as described in 1VAC17-11-30, the agency shall send the following information:

1. A notice of intended regulatory action (NOIRA).

2. A notice of the comment period on a proposed, a reproposed, or a fast-track regulation and hyperlinks to, or instructions on how to obtain, a copy of the regulation and any supporting documents.

3. A notice soliciting comment on a final regulation when the regulatory process has been extended pursuant to § 2.2-4007.06 or 2.2-4013 C of the Code of Virginia.

B. The failure of any person to receive any notice or copies of any documents shall not affect the validity of any regulation or regulatory action.

Part III
Public Participation Procedures

1VAC17-11-50. Public comment.

A. In considering any nonemergency, nonexempt regulatory action, the agency shall afford interested persons an opportunity to submit data, views, and arguments, either orally or in writing, to the agency. Such opportunity to comment shall include an online public comment forum on the Town Hall.

1. To any requesting person, the agency shall provide copies of the statement of basis, purpose, substance, and issues; the economic impact analysis of the proposed or fast-track regulatory action; and the agency's response to public comments received.

2. The agency may begin crafting a regulatory action prior to or during any opportunities it provides to the public to submit comments.

B. The agency shall accept public comments in writing after the publication of a regulatory action in the Virginia Register as follows:

1. For a minimum of 30 calendar days following the publication of the notice of intended regulatory action (NOIRA).

2. For a minimum of 60 calendar days following the publication of a proposed regulation.

3. For a minimum of 30 calendar days following the publication of a reproposed regulation.

4. For a minimum of 30 calendar days following the publication of a final adopted regulation.

5. For a minimum of 30 calendar days following the publication of a fast-track regulation.

6. For a minimum of 21 calendar days following the publication of a notice of periodic review.

7. Not later than 21 calendar days following the publication of a petition for rulemaking.

C. The agency may determine if any of the comment periods listed in subsection B of this section shall be extended.

D. If the Governor finds that one or more changes with substantial impact have been made to a proposed regulation, he may require the agency to provide an additional 30 calendar days to solicit additional public comment on the changes in accordance with § 2.2-4013 C of the Code of Virginia.

E. The agency shall send a draft of the agency's summary description of public comment to all public commenters on the proposed regulation at least five days before final adoption of the regulation pursuant to § 2.2-4012 E of the Code of Virginia.

1VAC17-11-60. Petition for rulemaking.

A. As provided in § 2.2-4007 of the Code of Virginia, any person may petition the agency to consider a regulatory action.

B. A petition shall include but is not limited to the following information:

1. The petitioner's name and contact information;

2. The substance and purpose of the rulemaking that is requested, including reference to any applicable Virginia Administrative Code sections; and

3. Reference to the legal authority of the agency to take the action requested.

C. The agency shall receive, consider and respond to a petition pursuant to § 2.2-4007 and shall have the sole authority to dispose of the petition.

D. The petition shall be posted on the Town Hall and published in the Virginia Register.

E. Nothing in this chapter shall prohibit the agency from receiving information or from proceeding on its own motion for rulemaking.

1VAC17-11-70. Appointment of regulatory advisory panel.

A. The agency may appoint a regulatory advisory panel (RAP) to provide professional specialization or technical assistance when the agency determines that such expertise is necessary to address a specific regulatory issue or action or when individuals indicate an interest in working with the agency on a specific regulatory issue or action.

B. Any person may request the appointment of a RAP and request to participate in its activities. The agency shall determine when a RAP shall be appointed and the composition of the RAP.

C. A RAP may be dissolved by the agency if:

1. The proposed text of the regulation is posted on the Town Hall, published in the Virginia Register, or such other time as the agency determines is appropriate; or

2. The agency determines that the regulatory action is either exempt or excluded from the requirements of the Administrative Process Act.

1VAC17-11-80. Appointment of negotiated rulemaking panel.

A. The agency may appoint a negotiated rulemaking panel (NRP) if a regulatory action is expected to be controversial.

B. An NRP that has been appointed by the agency may be dissolved by the agency when:

1. There is no longer controversy associated with the development of the regulation;

2. The agency determines that the regulatory action is either exempt or excluded from the requirements of the Administrative Process Act; or

3. The agency determines that resolution of a controversy is unlikely.

1VAC17-11-90. Meetings.

Notice of any open meeting, including meetings of a RAP or NRP, shall be posted on the Virginia Regulatory Town Hall and Commonwealth Calendar at least seven working days prior to the date of the meeting. The exception to this requirement is any meeting held in accordance with § 2.2-3707 D of the Code of Virginia allowing for contemporaneous notice to be provided to participants and the public.

1VAC17-11-100. Public hearings on regulations.

A. The agency shall indicate in its notice of intended regulatory action whether it plans to hold a public hearing following the publication of the proposed stage of the regulatory action.

B. The agency may conduct one or more public hearings during the comment period following the publication of a proposed regulatory action.

C. An agency is required to hold a public hearing following the publication of the proposed regulatory action when:

1. The agency's basic law requires the agency to hold a public hearing;

2. The Governor directs the agency to hold a public hearing; or

3. The agency receives requests for a public hearing from at least 25 persons during the public comment period following the publication of the notice of intended regulatory action.

D. Notice of any public hearing shall be posted on the Town Hall and Commonwealth Calendar at least seven working days prior to the date of the hearing. The agency shall also notify those persons who requested a hearing under subdivision C 3 of this section.

1VAC17-11-110. Periodic review of regulations.

A. The agency shall conduct a periodic review of its regulations consistent with:

1. An executive order issued by the Governor pursuant to § 2.2-4017 of the Administrative Process Act to receive comment on all existing regulations as to their effectiveness, efficiency, necessity, clarity, and cost of compliance; and

2. The requirements in § 2.2-4007.1 of the Administrative Process Act regarding regulatory flexibility for small businesses.

B. A periodic review may be conducted separately or in conjunction with other regulatory actions.

C. Notice of a periodic review shall be posted on the Town Hall and published in the Virginia Register.

Titles of Regulations: 1VAC30-10. Public Participation Guidelines (repealing 1VAC30-10-10 through 1VAC30-10-70).

1VAC30-11. Public Participation Guidelines (adding 1VAC30-11-10 through 1VAC30-11-110).

Statutory Authority: §§ 2.2-1102 and 2.2-4007.02 of the Code of Virginia.

Effective Date: January 21, 2009.

Agency Contact: Rhonda Bishton, Regulatory Coordinator, Department of General Services, 202 North Ninth Street, Room 209, Richmond, VA 23219, telephone (804) 786-3311, FAX (804) 371-8305, or email rhonda.bishton@dgs.virginia.gov.

Summary:

The regulations comply with the legislative mandate (Chapter 321, 2008 Acts of Assembly) that agencies adopt model public participation guidelines issued by the Department of Planning and Budget by December 1, 2008. Public participation guidelines exist to promote public involvement in the development, amendment, or repeal of an agency's regulations.

This regulatory action repeals the current public participation guidelines and promulgates new public participation guidelines as required by Chapter 321 of the 2008 Acts of Assembly. Highlights of the public participation guidelines include (i) providing for the establishment and maintenance of notification lists of interested persons and specifying the information to be sent to such persons; (ii) providing for public comments on regulatory actions; (iii) establishing the time period during which public comments shall be accepted; (iv) providing that the plan to hold a public meeting shall be indicated in any notice of intended regulatory action; (v) providing for the appointment, when necessary, of regulatory advisory panels to provide professional specialization or technical assistance and negotiated rulemaking panels if a regulatory action is expected to be controversial; and (vi) providing for the periodic review of regulations.

CHAPTER 11
PUBLIC PARTICIPATION GUIDELINES

Part I
Purpose and Definitions

1VAC30-11-10. Purpose.

The purpose of this chapter is to promote public involvement in the development, amendment or repeal of the regulations of the Department of General Services. This chapter does not apply to regulations, guidelines, or other documents exempted or excluded from the provisions of the Administrative Process Act (§ 2.2-4000 et seq. of the Code of Virginia).

1VAC30-11-20. Definitions.

The following words and terms when used in this chapter shall have the following meanings unless the context clearly indicates otherwise:

"Administrative Process Act" means Chapter 40 (§ 2.2-4000 et seq.) of Title 2.2 of the Code of Virginia.

"Agency" means the Department of General Services, which is the unit of state government empowered by the agency's basic law to make regulations or decide cases. Actions specified in this chapter may be fulfilled by state employees as delegated by the agency.

"Basic law" means provisions in the Code of Virginia that delineate the basic authority and responsibilities of an agency.

"Commonwealth Calendar" means the electronic calendar for official government meetings open to the public as required by § 2.2-3707 C of the Freedom of Information Act.

''Negotiated rulemaking panel'' or ''NRP'' means an ad hoc advisory panel of interested parties established by an agency to consider issues that are controversial with the assistance of a facilitator or mediator, for the purpose of reaching a consensus in the development of a proposed regulatory action.

"Notification list" means a list used to notify persons pursuant to this chapter. Such a list may include an electronic list maintained through the Virginia Regulatory Town Hall or other list maintained by the agency.

"Open meeting" means any scheduled gathering of a unit of state government empowered by an agency's basic law to make regulations or decide cases, which is related to promulgating, amending or repealing a regulation.

"Person" means any individual, corporation, partnership, association, cooperative, limited liability company, trust, joint venture, government, political subdivision, or any other legal or commercial entity and any successor, representative, agent, agency, or instrumentality thereof.

"Public hearing" means a scheduled time at which members or staff of the agency will meet for the purpose of receiving public comment on a regulatory action.

"Regulation" means any statement of general application having the force of law, affecting the rights or conduct of any person, adopted by the agency in accordance with the authority conferred on it by applicable laws.

"Regulatory action" means the promulgation, amendment, or repeal of a regulation by the agency.

"Regulatory advisory panel" or "RAP" means a standing or ad hoc advisory panel of interested parties established by the agency for the purpose of assisting in regulatory actions.

"Town Hall" means the Virginia Regulatory Town Hall, the website operated by the Virginia Department of Planning and Budget at www.townhall.virginia.gov, which has online public comment forums and displays information about regulatory meetings and regulatory actions under consideration in Virginia and sends this information to registered public users.

"Virginia Register" means the Virginia Register of Regulations, the publication that provides official legal notice of new, amended and repealed regulations of state agencies, which is published under the provisions of Article 6 (§ 2.2-4031 et seq.) of the Administrative Process Act.

Part II
Notification of Interested Persons

1VAC30-11-30. Notification list.

A. The agency shall maintain a list of persons who have requested to be notified of regulatory actions being pursued by the agency.

B. Any person may request to be placed on a notification list by registering as a public user on the Town Hall or by making a request to the agency. Any person who requests to be placed on a notification list shall elect to be notified either by electronic means or through a postal carrier.

C. The agency may maintain additional lists for persons who have requested to be informed of specific regulatory issues, proposals, or actions.

D. When electronic mail is returned as undeliverable on multiple occasions at least 24 hours apart, that person may be deleted from the list. A single undeliverable message is insufficient cause to delete the person from the list.

E. When mail delivered by a postal carrier is returned as undeliverable on multiple occasions, that person may be deleted from the list.

F. The agency may periodically request those persons on the notification list to indicate their desire to either continue to be notified electronically, receive documents through a postal carrier, or be deleted from the list.

1VAC30-11-40. Information to be sent to persons on the notification list.

A. To persons electing to receive electronic notification or notification through a postal carrier as described in 1VAC30-11-30, the agency shall send the following information:

1. A notice of intended regulatory action (NOIRA).

2. A notice of the comment period on a proposed, a reproposed, or a fast-track regulation and hyperlinks to, or instructions on how to obtain, a copy of the regulation and any supporting documents.

3. A notice soliciting comment on a final regulation when the regulatory process has been extended pursuant to § 2.2-4007.06 or 2.2-4013 C of the Code of Virginia.

B. The failure of any person to receive any notice or copies of any documents shall not affect the validity of any regulation or regulatory action.

Part III
Public Participation Procedures

1VAC30-11-50. Public comment.

A. In considering any nonemergency, nonexempt regulatory action, the agency shall afford interested persons an opportunity to submit data, views, and arguments, either orally or in writing, to the agency. Such opportunity to comment shall include an online public comment forum on the Town Hall.

1. To any requesting person, the agency shall provide copies of the statement of basis, purpose, substance, and issues; the economic impact analysis of the proposed or fast-track regulatory action; and the agency's response to public comments received.

2. The agency may begin crafting a regulatory action prior to or during any opportunities it provides to the public to submit comments.

B. The agency shall accept public comments in writing after the publication of a regulatory action in the Virginia Register as follows:

1. For a minimum of 30 calendar days following the publication of the notice of intended regulatory action (NOIRA).

2. For a minimum of 60 calendar days following the publication of a proposed regulation.

3. For a minimum of 30 calendar days following the publication of a reproposed regulation.

4. For a minimum of 30 calendar days following the publication of a final adopted regulation.

5. For a minimum of 30 calendar days following the publication of a fast-track regulation.

6. For a minimum of 21 calendar days following the publication of a notice of periodic review.

7. Not later than 21 calendar days following the publication of a petition for rulemaking.

C. The agency may determine if any of the comment periods listed in subsection B of this section shall be extended.

D. If the Governor finds that one or more changes with substantial impact have been made to a proposed regulation, he may require the agency to provide an additional 30 calendar days to solicit additional public comment on the changes in accordance with § 2.2-4013 C of the Code of Virginia.

E. The agency shall send a draft of the agency's summary description of public comment to all public commenters on the proposed regulation at least five days before final adoption of the regulation pursuant to § 2.2-4012 E of the Code of Virginia.

1VAC30-11-60. Petition for rulemaking.

A. As provided in § 2.2-4007 of the Code of Virginia, any person may petition the agency to consider a regulatory action.

B. A petition shall include but is not limited to the following information:

1. The petitioner's name and contact information;

2. The substance and purpose of the rulemaking that is requested, including reference to any applicable Virginia Administrative Code sections; and

3. Reference to the legal authority of the agency to take the action requested.

C. The agency shall receive, consider and respond to a petition pursuant to § 2.2-4007 and shall have the sole authority to dispose of the petition.

D. The petition shall be posted on the Town Hall and published in the Virginia Register.

E. Nothing in this chapter shall prohibit the agency from receiving information or from proceeding on its own motion for rulemaking.

1VAC30-11-70. Appointment of regulatory advisory panel.

A. The agency may appoint a regulatory advisory panel (RAP) to provide professional specialization or technical assistance when the agency determines that such expertise is necessary to address a specific regulatory issue or action or when individuals indicate an interest in working with the agency on a specific regulatory issue or action.

B. Any person may request the appointment of a RAP and request to participate in its activities. The agency shall determine when a RAP shall be appointed and the composition of the RAP.

C. A RAP may be dissolved by the agency if:

1. The proposed text of the regulation is posted on the Town Hall, published in the Virginia Register, or such other time as the agency determines is appropriate; or

2. The agency determines that the regulatory action is either exempt or excluded from the requirements of the Administrative Process Act.

1VAC30-11-80. Appointment of negotiated rulemaking panel.

A. The agency may appoint a negotiated rulemaking panel (NRP) if a regulatory action is expected to be controversial.

B. An NRP that has been appointed by the agency may be dissolved by the agency when:

1. There is no longer controversy associated with the development of the regulation;

2. The agency determines that the regulatory action is either exempt or excluded from the requirements of the Administrative Process Act; or

3. The agency determines that resolution of a controversy is unlikely.

1VAC30-11-90. Meetings.

Notice of any open meeting, including meetings of a RAP or NRP, shall be posted on the Virginia Regulatory Town Hall and Commonwealth Calendar at least seven working days prior to the date of the meeting. The exception to this requirement is any meeting held in accordance with § 2.2-3707 D of the Code of Virginia allowing for contemporaneous notice to be provided to participants and the public.

1VAC30-11-100. Public hearings on regulations.

A. The agency shall indicate in its notice of intended regulatory action whether it plans to hold a public hearing following the publication of the proposed stage of the regulatory action.

B. The agency may conduct one or more public hearings during the comment period following the publication of a proposed regulatory action.

C. An agency is required to hold a public hearing following the publication of the proposed regulatory action when:

1. The agency's basic law requires the agency to hold a public hearing;

2. The Governor directs the agency to hold a public hearing; or

3. The agency receives requests for a public hearing from at least 25 persons during the public comment period following the publication of the notice of intended regulatory action.

D. Notice of any public hearing shall be posted on the Town Hall and Commonwealth Calendar at least seven working days prior to the date of the hearing. The agency shall also notify those persons who requested a hearing under subdivision C 3 of this section.

1VAC30-11-110. Periodic review of regulations.

A. The agency shall conduct a periodic review of its regulations consistent with:

1. An executive order issued by the Governor pursuant to § 2.2-4017 of the Administrative Process Act to receive comment on all existing regulations as to their effectiveness, efficiency, necessity, clarity, and cost of compliance; and

2. The requirements in § 2.2-4007.1 of the Administrative Process Act regarding regulatory flexibility for small businesses.

B. A periodic review may be conducted separately or in conjunction with other regulatory actions.

C. Notice of a periodic review shall be posted on the Town Hall and published in the Virginia Register.

Titles of Regulations: 1VAC30-10. Public Participation Guidelines (repealing 1VAC30-10-10 through 1VAC30-10-70).

1VAC30-11. Public Participation Guidelines (adding 1VAC30-11-10 through 1VAC30-11-110).

Statutory Authority: §§ 2.2-1102 and 2.2-4007.02 of the Code of Virginia.

Effective Date: January 21, 2009.

Agency Contact: Rhonda Bishton, Regulatory Coordinator, Department of General Services, 202 North Ninth Street, Room 209, Richmond, VA 23219, telephone (804) 786-3311, FAX (804) 371-8305, or email rhonda.bishton@dgs.virginia.gov.

Summary:

The regulations comply with the legislative mandate (Chapter 321, 2008 Acts of Assembly) that agencies adopt model public participation guidelines issued by the Department of Planning and Budget by December 1, 2008. Public participation guidelines exist to promote public involvement in the development, amendment, or repeal of an agency's regulations.

This regulatory action repeals the current public participation guidelines and promulgates new public participation guidelines as required by Chapter 321 of the 2008 Acts of Assembly. Highlights of the public participation guidelines include (i) providing for the establishment and maintenance of notification lists of interested persons and specifying the information to be sent to such persons; (ii) providing for public comments on regulatory actions; (iii) establishing the time period during which public comments shall be accepted; (iv) providing that the plan to hold a public meeting shall be indicated in any notice of intended regulatory action; (v) providing for the appointment, when necessary, of regulatory advisory panels to provide professional specialization or technical assistance and negotiated rulemaking panels if a regulatory action is expected to be controversial; and (vi) providing for the periodic review of regulations.

CHAPTER 11
PUBLIC PARTICIPATION GUIDELINES

Part I
Purpose and Definitions

1VAC30-11-10. Purpose.

The purpose of this chapter is to promote public involvement in the development, amendment or repeal of the regulations of the Department of General Services. This chapter does not apply to regulations, guidelines, or other documents exempted or excluded from the provisions of the Administrative Process Act (§ 2.2-4000 et seq. of the Code of Virginia).

1VAC30-11-20. Definitions.

The following words and terms when used in this chapter shall have the following meanings unless the context clearly indicates otherwise:

"Administrative Process Act" means Chapter 40 (§ 2.2-4000 et seq.) of Title 2.2 of the Code of Virginia.

"Agency" means the Department of General Services, which is the unit of state government empowered by the agency's basic law to make regulations or decide cases. Actions specified in this chapter may be fulfilled by state employees as delegated by the agency.

"Basic law" means provisions in the Code of Virginia that delineate the basic authority and responsibilities of an agency.

"Commonwealth Calendar" means the electronic calendar for official government meetings open to the public as required by § 2.2-3707 C of the Freedom of Information Act.

''Negotiated rulemaking panel'' or ''NRP'' means an ad hoc advisory panel of interested parties established by an agency to consider issues that are controversial with the assistance of a facilitator or mediator, for the purpose of reaching a consensus in the development of a proposed regulatory action.

"Notification list" means a list used to notify persons pursuant to this chapter. Such a list may include an electronic list maintained through the Virginia Regulatory Town Hall or other list maintained by the agency.

"Open meeting" means any scheduled gathering of a unit of state government empowered by an agency's basic law to make regulations or decide cases, which is related to promulgating, amending or repealing a regulation.

"Person" means any individual, corporation, partnership, association, cooperative, limited liability company, trust, joint venture, government, political subdivision, or any other legal or commercial entity and any successor, representative, agent, agency, or instrumentality thereof.

"Public hearing" means a scheduled time at which members or staff of the agency will meet for the purpose of receiving public comment on a regulatory action.

"Regulation" means any statement of general application having the force of law, affecting the rights or conduct of any person, adopted by the agency in accordance with the authority conferred on it by applicable laws.

"Regulatory action" means the promulgation, amendment, or repeal of a regulation by the agency.

"Regulatory advisory panel" or "RAP" means a standing or ad hoc advisory panel of interested parties established by the agency for the purpose of assisting in regulatory actions.

"Town Hall" means the Virginia Regulatory Town Hall, the website operated by the Virginia Department of Planning and Budget at www.townhall.virginia.gov, which has online public comment forums and displays information about regulatory meetings and regulatory actions under consideration in Virginia and sends this information to registered public users.

"Virginia Register" means the Virginia Register of Regulations, the publication that provides official legal notice of new, amended and repealed regulations of state agencies, which is published under the provisions of Article 6 (§ 2.2-4031 et seq.) of the Administrative Process Act.

Part II
Notification of Interested Persons

1VAC30-11-30. Notification list.

A. The agency shall maintain a list of persons who have requested to be notified of regulatory actions being pursued by the agency.

B. Any person may request to be placed on a notification list by registering as a public user on the Town Hall or by making a request to the agency. Any person who requests to be placed on a notification list shall elect to be notified either by electronic means or through a postal carrier.

C. The agency may maintain additional lists for persons who have requested to be informed of specific regulatory issues, proposals, or actions.

D. When electronic mail is returned as undeliverable on multiple occasions at least 24 hours apart, that person may be deleted from the list. A single undeliverable message is insufficient cause to delete the person from the list.

E. When mail delivered by a postal carrier is returned as undeliverable on multiple occasions, that person may be deleted from the list.

F. The agency may periodically request those persons on the notification list to indicate their desire to either continue to be notified electronically, receive documents through a postal carrier, or be deleted from the list.

1VAC30-11-40. Information to be sent to persons on the notification list.

A. To persons electing to receive electronic notification or notification through a postal carrier as described in 1VAC30-11-30, the agency shall send the following information:

1. A notice of intended regulatory action (NOIRA).

2. A notice of the comment period on a proposed, a reproposed, or a fast-track regulation and hyperlinks to, or instructions on how to obtain, a copy of the regulation and any supporting documents.

3. A notice soliciting comment on a final regulation when the regulatory process has been extended pursuant to § 2.2-4007.06 or 2.2-4013 C of the Code of Virginia.

B. The failure of any person to receive any notice or copies of any documents shall not affect the validity of any regulation or regulatory action.

Part III
Public Participation Procedures

1VAC30-11-50. Public comment.

A. In considering any nonemergency, nonexempt regulatory action, the agency shall afford interested persons an opportunity to submit data, views, and arguments, either orally or in writing, to the agency. Such opportunity to comment shall include an online public comment forum on the Town Hall.

1. To any requesting person, the agency shall provide copies of the statement of basis, purpose, substance, and issues; the economic impact analysis of the proposed or fast-track regulatory action; and the agency's response to public comments received.

2. The agency may begin crafting a regulatory action prior to or during any opportunities it provides to the public to submit comments.

B. The agency shall accept public comments in writing after the publication of a regulatory action in the Virginia Register as follows:

1. For a minimum of 30 calendar days following the publication of the notice of intended regulatory action (NOIRA).

2. For a minimum of 60 calendar days following the publication of a proposed regulation.

3. For a minimum of 30 calendar days following the publication of a reproposed regulation.

4. For a minimum of 30 calendar days following the publication of a final adopted regulation.

5. For a minimum of 30 calendar days following the publication of a fast-track regulation.

6. For a minimum of 21 calendar days following the publication of a notice of periodic review.

7. Not later than 21 calendar days following the publication of a petition for rulemaking.

C. The agency may determine if any of the comment periods listed in subsection B of this section shall be extended.

D. If the Governor finds that one or more changes with substantial impact have been made to a proposed regulation, he may require the agency to provide an additional 30 calendar days to solicit additional public comment on the changes in accordance with § 2.2-4013 C of the Code of Virginia.

E. The agency shall send a draft of the agency's summary description of public comment to all public commenters on the proposed regulation at least five days before final adoption of the regulation pursuant to § 2.2-4012 E of the Code of Virginia.

1VAC30-11-60. Petition for rulemaking.

A. As provided in § 2.2-4007 of the Code of Virginia, any person may petition the agency to consider a regulatory action.

B. A petition shall include but is not limited to the following information:

1. The petitioner's name and contact information;

2. The substance and purpose of the rulemaking that is requested, including reference to any applicable Virginia Administrative Code sections; and

3. Reference to the legal authority of the agency to take the action requested.

C. The agency shall receive, consider and respond to a petition pursuant to § 2.2-4007 and shall have the sole authority to dispose of the petition.

D. The petition shall be posted on the Town Hall and published in the Virginia Register.

E. Nothing in this chapter shall prohibit the agency from receiving information or from proceeding on its own motion for rulemaking.

1VAC30-11-70. Appointment of regulatory advisory panel.

A. The agency may appoint a regulatory advisory panel (RAP) to provide professional specialization or technical assistance when the agency determines that such expertise is necessary to address a specific regulatory issue or action or when individuals indicate an interest in working with the agency on a specific regulatory issue or action.

B. Any person may request the appointment of a RAP and request to participate in its activities. The agency shall determine when a RAP shall be appointed and the composition of the RAP.

C. A RAP may be dissolved by the agency if:

1. The proposed text of the regulation is posted on the Town Hall, published in the Virginia Register, or such other time as the agency determines is appropriate; or

2. The agency determines that the regulatory action is either exempt or excluded from the requirements of the Administrative Process Act.

1VAC30-11-80. Appointment of negotiated rulemaking panel.

A. The agency may appoint a negotiated rulemaking panel (NRP) if a regulatory action is expected to be controversial.

B. An NRP that has been appointed by the agency may be dissolved by the agency when:

1. There is no longer controversy associated with the development of the regulation;

2. The agency determines that the regulatory action is either exempt or excluded from the requirements of the Administrative Process Act; or

3. The agency determines that resolution of a controversy is unlikely.

1VAC30-11-90. Meetings.

Notice of any open meeting, including meetings of a RAP or NRP, shall be posted on the Virginia Regulatory Town Hall and Commonwealth Calendar at least seven working days prior to the date of the meeting. The exception to this requirement is any meeting held in accordance with § 2.2-3707 D of the Code of Virginia allowing for contemporaneous notice to be provided to participants and the public.

1VAC30-11-100. Public hearings on regulations.

A. The agency shall indicate in its notice of intended regulatory action whether it plans to hold a public hearing following the publication of the proposed stage of the regulatory action.

B. The agency may conduct one or more public hearings during the comment period following the publication of a proposed regulatory action.

C. An agency is required to hold a public hearing following the publication of the proposed regulatory action when:

1. The agency's basic law requires the agency to hold a public hearing;

2. The Governor directs the agency to hold a public hearing; or

3. The agency receives requests for a public hearing from at least 25 persons during the public comment period following the publication of the notice of intended regulatory action.

D. Notice of any public hearing shall be posted on the Town Hall and Commonwealth Calendar at least seven working days prior to the date of the hearing. The agency shall also notify those persons who requested a hearing under subdivision C 3 of this section.

1VAC30-11-110. Periodic review of regulations.

A. The agency shall conduct a periodic review of its regulations consistent with:

1. An executive order issued by the Governor pursuant to § 2.2-4017 of the Administrative Process Act to receive comment on all existing regulations as to their effectiveness, efficiency, necessity, clarity, and cost of compliance; and

2. The requirements in § 2.2-4007.1 of the Administrative Process Act regarding regulatory flexibility for small businesses.

B. A periodic review may be conducted separately or in conjunction with other regulatory actions.

C. Notice of a periodic review shall be posted on the Town Hall and published in the Virginia Register.

Title of Regulation: 4VAC20-950. Pertaining to Black Sea Bass (amending 4VAC20-950-47, 4VAC20-950-48).

Statutory Authority: § 28.2-201 of the Code of Virginia.

Effective Date: January 1, 2009.

Agency Contact: Jane Warren, Agency Regulatory Coordinator, Marine Resources Commission, 2600 Washington Avenue, 3rd Floor, Newport News, VA 23607, telephone (757) 247-2248, FAX (757) 247-2002, or email betty.warren@mrc.virginia.gov.

Summary:

The amendments establish that (i) the 2009 commercial black sea bass directed fishery quota shall be 168,638 pounds and the bycatch fishery quota shall be 40,000 pounds from January 1 through April 30, and from May 1 through December 31, 2009, the black sea bass bycatch fishery quota is the lesser of 10,000 pounds or the remaining amount of black sea bass bycatch fishery quota as of May 1, 2009; (ii) when 75% of the bycatch fishery quota has been taken, it shall be unlawful for any person permitted for the bycatch fishery to possess aboard a vessel or to land in Virginia more than 100 pounds of black sea bass; and (iii) as of May 1, 2009, should the remaining amount of black sea bass bycatch fishery quota exceed 10,000 pounds, that excess quota shall be allocated to commercial black sea bass directed fishery permit holders who have landed at least 500 pounds of black sea bass in at least two of three years starting in 2005 and ending in 2007. The basis for that allocation shall be the same as used to determine an individual directed fishery quota as described in 4VAC20-950-46.

4VAC20-950-47. Commercial harvest quotas.

A. The 2008 2009 commercial black sea bass directed fishery quota is 355,152 168,638 pounds. When it has been announced that the directed fishery quota has been projected as reached and the directed fishery has been closed, it shall be unlawful for any directed commercial black sea bass fishery permittee to possess aboard any vessel or land in Virginia any black sea bass.

B. The 2008 2009 commercial black sea bass bycatch fishery quota is 40,000 pounds from January 1 through April 30. From May 1 through December 31, 2009, the commercial black sea bass bycatch fishery quota is the lesser of 10,000 pounds or the remaining amount of black sea bass bycatch fishery quota as of May 1, 2009. When it has been announced that the bycatch fishery quota has been projected as reached and the bycatch fishery has been closed, it shall be unlawful for any bycatch commercial black sea bass fishery permittee to possess aboard any vessel or land in Virginia any black sea bass. In the event the bycatch fishery quota is exceeded, the amount the quota overage shall be deducted from the following year's bycatch fishing quota.

4VAC20-950-48. Individual fishery quotas; bycatch limit; at sea harvesters; exceptions.

A. Each person possessing a directed fishery permit shall be assigned an individual fishery quota, in pounds, for each calendar year. Except as provided in subsection F of this section, a person's individual fishery quota shall be equal to that person's percentage of the total landings of black sea bass in Virginia from July 1, 1997, through December 31, 2001, multiplied by the directed commercial fishery black sea bass quota for the calendar year. Any directed fishery permittee shall be limited to landings in the amount of his individual fishery quota, in pounds, in any calendar year and it shall be unlawful for any permittee to exceed his individual fishery quota. In addition to the penalties prescribed by law, any overages of an individual's fishery quota shall be deducted from that permittee's individual fishery quota for the following year.

B. In the determination of a person's percentage of total landings, the commission shall use the greater amount of landings from either the National Marine Fisheries Service Dealer Weigh-out Reports or National Marine Fisheries Service Vessel Trip Reports that have been reported and filed as of November 26, 2002. If a person's percentage of the total landings of black sea bass is determined by using the Vessel Trip Reports as the greater amount, then the person shall provide documentation to the Marine Resources Commission to verify the Vessel Trip Reports as accurate. This documentation may include dealer receipts of sales or other pertinent documentation, and such documentation shall be submitted to the commission by December 1, 2004. In the event the commission is not able to verify the full amount of the person's Vessel Trip Reports for the qualifying period, the commission shall use the greater amount of landings, from either the Dealer Weigh-Out Reports or the verified portion of the Vessel Trip Reports to establish that person's share of the quota.

C. It shall be unlawful for any person permitted for the bycatch fishery to possess aboard a vessel, or to land in Virginia, in any one day, more than 200 pounds of black sea bass, except that any person permitted in the bycatch fishery may possess aboard a vessel, or land in Virginia, more than 200 pounds of black sea bass, in any one day, provided the total weight of black sea bass on board the vessel does not exceed 10%, by weight, of the total weight of summer flounder, scup, Loligo squid and Atlantic mackerel on board the vessel. When it is projected and announced that 85% 75% of the bycatch fishery quota has been be taken, it shall be unlawful for any person permitted for the bycatch fishery to possess aboard a vessel, or to land in Virginia, more than 200 100 pounds of black sea bass, except that any person permitted in the bycatch fishery may possess aboard a vessel, or land in Virginia, more than 200 pounds of black sea bass, in any one day, but not more than 1,000 pounds, provided the total weight of black sea bass aboard the vessel does not exceed 10%, by weight, of the total weight of summer flounder, scup, Loligo squid and Atlantic mackerel on board the vessel.

D. It shall be unlawful for any person to transfer black sea bass from one vessel to another while at sea.

E. The commission sets aside 10,000 pounds of the annual commercial fishery black sea bass quota for distribution to all qualified applicants granted an exception by the commission from the requirements of 4VAC20-950-46 B based upon medical conditions, or other hardship, which limited the applicant's ability to fish for black sea bass during the qualifying period. In granting an exception, the commission will give preference to those applicants who can demonstrate the greater levels of participation in the black sea bass fishery during and after the qualifying period or document an apprenticeship or helper status in the black sea bass fishery. Any applicant who is granted an exception by the commission shall receive a portion of the 10,000 pounds; however, no portion shall exceed the lowest individual fishery quota, in pounds, at the beginning of the season. There shall be no transfer of quota received by applicants to the exception process for a period of five years after receipt of that quota. Any portion of the 10,000 pounds not allotted by the commission to the qualified applicants as of November 1 shall be added to the annual bycatch quota described in 4VAC20-950-47 B.

F. An individual fishery quota, as described in subsection A of this section, shall be equal to an individual's current percentage share of the directed fishery quota, as described in 4VAC20-950-47 A. As of May 1, 2009, should the remaining amount of black sea bass bycatch fishery quota exceed 10,000 pounds, that excess quota shall be allocated to commercial black sea bass directed fishery permit holders who have landed at least 500 pounds of black sea bass in at least two of three years, starting in 2005 and ending in 2007. The basis for that allocation shall be the same as used to determine an individual directed fishery quota as described in subsection A of this section.

Title of Regulation: 4VAC20-1040. Pertaining to Crabbing Licenses (amending 4VAC20-1040-20; adding 4VAC20-1040-25).

Statutory Authority: § 28.2-201 of the Code of Virginia.

Effective Date: November 30, 2008.

Agency Contact: Jane Warren, Agency Regulatory Coordinator, Marine Resources Commission, 2600 Washington Avenue, 3rd Floor, Newport News, VA 23607, telephone (757) 247-2248, FAX (757) 247-2002, or email betty.warren@mrc.virginia.gov.

Summary:

The amendments (i) establish license ineligibility conditions for the lawful crabbing seasons of 2008 through 2010 for crab pots and peeler pots; (ii) establish that for the lawful crabbing seasons of 2009 and all subsequent seasons, those registered commercial fisherman who were eligible from 2004 through 2008 for any crab pot or peeler pot licenses, but reported no harvest from 2004 through 2007, shall be placed on a waiting list and shall be ineligible to purchase a crab pot or peeler pot license, except as described in 4VAC20-1040-20 B; (iii) establish that those crab pot or peeler pot fishermen who reported harvest prior to the control date of December 17, 2007, from the crab dredge fishery for both the 2005/2006 and 2006/2007 seasons, shall remain eligible to purchase their crab pot or peeler pot license for the lawful crabbing seasons of 2009 and 2010, and establish that those crab pot or peeler pot fishermen who do not meet the condition shall remain on the waiting list until such time that results from the Chesapeake Bay Winter Dredge Survey indicate that an abundance of 200 million age 1+ blue crabs (2.4 inches and greater, carapace width) has been attained in three consecutive seasonal (December/March) surveys; and (iv) establish that any registered commercial fisherman may appeal the status of his license ineligibility to the commission provided documentation of a health condition that prevented the harvest of any crabs during the 2004 through 2007 lawful crabbing seasons, active military service that prevented the harvest of any crabs during the 2004 through 2007 lawful crabbing seasons, or a substantial error in his Mandatory Harvest Reporting records.

4VAC20-1040-20. License sales moratorium and license ineligibility conditions.

A. For the lawful crabbing seasons of 2008 through 2010, commercial licenses for crab pot, peeler pot, crab scrape, crab trap, ordinary trot line, patent trot line, and dip net shall be sold only to those registered commercial fishermen who have been determined by the commission to be eligible to purchase any of these licenses in 2007, except as described in subsection B of this section. Any person receiving a crab license by lawful transfer in 2008 through 2010 also establishes his eligibility to purchase that specific license through 2010; however, any person either failing to register as a commercial fisherman in any year or lawfully transferring his crab license to another person shall forfeit his eligibility to purchase that specific crab license through 2010.

B. For the lawful crabbing seasons of 2009 and all subsequent seasons, those registered commercial fishermen who were eligible from 2004 through 2008 for any crab pot or peeler pot licenses, but reported no harvest from 2004 through 2007, shall be placed on a waiting list and shall be ineligible to purchase a crab pot or peeler pot license, except as described in subdivisions 1 and 2 of this subsection.

1. Those crab pot or peeler pot fishermen, described in this subsection, who reported harvest prior to the control date of December 17, 2007, from the crab dredge fishery for both the 2005/06 and 2006/07 seasons shall remain eligible to purchase their crab pot or peeler pot license for the lawful crabbing seasons of 2009 and 2010.

2. Those crab pot or peeler pot fishermen, described in this subsection, who do not meet the condition described in subdivision 1 of this subsection shall remain on the waiting list until such time that results from the Chesapeake Bay Winter Dredge Survey indicate that an abundance of 200 million age 1+ blue crabs (blue crabs 2.4 inches and greater, in carapace width) has been attained in three consecutive, seasonal (December - March) surveys.

C. Any person receiving a crab license by lawful transfer in 2008 through 2010 also establishes his eligibility to purchase that specific license through 2010; however, any person either failing to register as a commercial fisherman in any year or lawfully transferring his crab license to another person shall forfeit his eligibility to purchase that specific crab license through 2010.

B. D. Commercial licenses for crab pots, peeler pots, crab scrapes, crab traps, ordinary trot lines, patent trot lines, and crab dip nets may be transferred to an immediate family member of the licensee at any time and, in the case of death or incapacitation of the licensee, may be transferred to a registered commercial fisherman at any time. Crabbing licenses also may be transferred to another registered commercial fisherman, except that not more than 100 licenses shall be transferred in the current year. All such transfers shall be documented on forms provided by the commission and shall be subject to the approval of the commissioner.

4VAC20-1040-25. Appeal process.

Any registered commercial fisherman described in 4VAC20-1040-20 B 2 may appeal the status of his license ineligibility, to the commission, provided he documents one of the following conditions: (i) a health condition that prevented the registered commercial fisherman from harvesting any crabs during the 2004 through 2007 lawful crabbing seasons; (ii) an active military service that prevented the registered commercial fisherman from harvesting any crabs during the 2004 through 2007 lawful crabbing seasons; or (iii) a substantial error in his mandatory harvest reporting records.

Title of Regulation: 6VAC20-260. Regulations Relating to Bail Enforcement Agents (adding 6VAC20-260-10 through 6VAC20-260-370).

Statutory Authority: §§ 9.1-102 and 9.1-186.2 of the Code of Virginia.

Public Hearing Information:

March 12, 2009 - 11 a.m. - General Assembly Building, House Room D, 910 Capitol Street, Richmond, VA.

Public Comments: Public comments may be submitted until February 20, 2009.

Agency Contact: Lisa McGee, Section Chief, Private Security Services Section, Department of Criminal Justice Services, 202 North 9th Street, 5th Floor, Richmond, VA 23219, telephone (804) 371-2419, FAX (804) 786-6344, or email lisa.mcgee@dcjs.virginia.gov.

Basis: The legal authority to regulate bail enforcement agents is found in subdivision 47 of § 9.1-102 of the Code of Virginia, effective October 1, 2005, authorizing the department, under the direction of the board to license and regulate bail enforcement agents in accordance with Article 12 (§ 9.1-186 et seq.) of Chapter 1 of Title 9.1 of the Code of Virginia. The board is adopting regulations that are necessary to ensure respectable, responsible, safe and effective bail enforcement within the Commonwealth pursuant to § 9.1-186.2 of the Code of Virginia.

Purpose: The purpose of the proposed regulation is to regulate bail enforcement agents. The regulation establishes a licensure process to include a fingerprint-based background check, licensure fees, compulsory minimum entry-level training standards, and administration of the regulatory system. It authorizes the department to receive complaints concerning the conduct of any person whose activities are monitored by the board, to conduct investigations, to issue disciplinary action, and to revoke, to suspend, and to refuse to renew a license. These procedures are established to ensure respectable, responsible, safe and effective bail enforcement in the Commonwealth.

The regulations will help to ensure respectable, responsible, safe and effective bail enforcement within the Commonwealth. This regulatory action will result in verifying the qualifications of the individuals providing bail enforcement services through criminal history records checks and training, to ensure competency and prevent deceptive or unsafe practices towards the family unit.

Substance: The regulation establishes a licensure process, licensure fees, compulsory minimum entry-level training standards including firearms training and qualifications, standards of conduct, and administration of the regulatory system. It outlines procedures for receiving complaints concerning the conduct of any person whose activities are monitored by the board; procedures for conducting investigations; issuing disciplinary action; and revoking, suspending, refusing to renew a license, and provides an appeal process pursuant to the Administrative Process Act.

Issues: The primary advantage of implementing the new provisions presented in the proposed regulations is to provide necessary public protection tasked through existing statutes. Advantages to the public and the Commonwealth are to ensure respectable, responsible, safe and effective bail enforcement in the Commonwealth. The goal of these regulations is to ensure eligible individuals in the bail enforcement industry receive compulsory minimum training, abide by established standards of conduct and ensure that individuals with certain criminal history records, or who are in violation of rules established for public safety are prohibited from performing bail enforcement services.

The establishment of these regulations does not pose any disadvantages to the public or the Commonwealth.

The Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Regulation. Pursuant to legislation passed during the 2004 General Assembly session, the Criminal Justice Services Board (Board) proposes regulations for licensure of bail enforcement agents (bounty hunters).

Result of Analysis. There is insufficient data to weigh the magnitude of costs versus benefits for this proposed regulation. Costs and benefits are discussed below.

Estimated Economic Impact. Previous to October 2005, bounty hunters were not regulated by the Commonwealth. This proposed regulation replaces emergency regulations for licensure of bounty hunters and will require bounty hunters to:

• Be at least 21 years of age. Although bounty hunters must be at least 21 to be licensed, bail bondsmen are only required to be at least 18 years of age to be licensed and to engage in fugitive recovery.

• Have a General Equivalency Diploma (GED) or a high school diploma.

• Undergo a fingerprint background check through the Department of Criminal Justice Services (DCJS) (this costs $60). Individuals will not be allowed licensure if they have ever been convicted of a felony or, except in certain limited cases, if they have been convicted of a misdemeanor in the last five years. DCJS does have a limited ability to license individuals who have a misdemeanor conviction so long as that conviction is not for 1) carrying a concealed weapon 2) assault and battery 3) sexual battery 4) a drug offence 5) driving under the influence 6) discharging a firearm 7) a sex offence or 8) larceny. This requirement is apparently more restrictive than conviction requirements for any other DCJS licensure program.

• Undergo 40 hours of bail enforcement core training and 14 hours of firearms training (if they intend to carry a gun while acting as a bounty hunter).

• Take an exam (through DCJS).

• Pay a licensure fee of $200. An additional $30 must be paid on an annual basis if a bounty hunter wants a DCJS firearms endorsement.

• Undergo eight hours of in-service training before biannual license renewal (fee for license renewal will be $200). Bounty hunters who fail to complete in-service training, and pay the renewal fee, before their licenses expire will have 60 days to reinstate their licenses. The fee for this will be the cost of renewal plus 50% of the cost of renewal ($200 + $100 = $300). Bounty hunters who fail to renew their licenses either before the expiration of their license or during the reinstatement period will have to complete all 40 hours of bail enforcement core training again.

• Retain all records on fugitive recovery for at least three years (at a physical location known to DCJS).

The General Assembly is requiring licensure for bounty hunters because there have been a few rather notorious incidents in Virginia where bounty hunters mistakenly seized or tried to seize the wrong person. One of these incidents, in 2002, ended in the death of a Mexican immigrant in South Richmond. There have also been, in the past few years, some allegations of sexual misconduct by bounty hunters. These incidences appear to be anomalous and not indicative of how bond recovery usually happens: nonetheless, legislators believe that licensure with several restrictions as to who may be licensed will protect the public from possible harm.

Weighed against this possible benefit are the costs that will be incurred by bounty hunters, bail bondsmen, localities, the state and the tax-paying public.

Bounty hunters who are not restricted from licensure will incur all explicit fees and training costs plus the implicit costs of time spent on becoming and remaining licensed (time spent in training, filling out paperwork, etc.). It is likely that three quarters of the individuals who worked as bounty hunters before October 2005 would not have been eligible for licensure (see discussion below under Projected Impact on Employment). These people would likely choose to continue working at bail recovery if the Commonwealth were not prohibiting that choice. Because of this, these individuals have incurred costs equal to what they could have earned working as a bounty hunter minus whatever they earn in alternate employment.

Bail bondsmen will likely incur larger costs associated with a likely lower probability of being able to capture bonded fugitives and return them to court jurisdiction before bail is forfeited. The number of bounty hunters has likely dropped precipitously since licensure has been required (see discussion below under Projected Impact on Employment); this drop in supply of bounty hunters is likely to make their services more expensive to acquire and will also likely mean that some fugitives who would otherwise be recaptured remain at large.

Additionally, since bounty hunting appears to be a job that attracts risk seeking individuals who live on the fringes of mainstream society (individuals who may be good at recovering fugitives because they, too, have been on the wrong side of the law and know how to think like a criminal), there may not be a large population of eligible individuals who would be as effective at fugitive recovery as those who are now ineligible for licensure were. Although bail bondsmen are able to engage in bond recovery, they will still incur costs if they choose to do this job themselves since time spent engaging in bond recovery cannot be spent engaging in writing bonds (an activity which likely has a higher return).

Localities and the state (and tax-paying citizens) will likely also incur costs associated with implementation of this proposed regulation (and its initiating legislation). Changes in the number and (potentially) the effectiveness of bounty hunters will likely mean that prisoners free on bond who choose to flee will be found and brought back for trial less often. When prisoners become fugitives, and remain at large, bail bondsmen have to forfeit their bonds to the court. Bail bondsmen are likely to respond to these monetary losses by refusing to offer bail to riskier prisoners. Other things remaining equal, this will mean that more prisoners will remain in jail longer or until their trial instead of being released. If this happens, and preliminary data would support that it will¹, the costs that localities and the state pay to house prisoners in jail will increase. The daily cost increase will be equal to the number of prisoners now housed (either until trial or during a more lengthy search for bond) rather than being released times the cost per day for housing, feeding clothing and guarding each prisoner in jail.

The public will also incur costs associated with possible increased fugitive rates. Although DCJS does not have information on individuals who fail to appear for court hearings or on individuals who are classified as fugitives because they remain at large for one year or longer, it is reasonable to assume that Virginia’s numbers in these categories would be proportional to national numbers (after adjusting for types of release allowed in each state). Nationally, each year roughly one quarter (200,000) of all released felony defendants fail to appear for scheduled court hearings. Of these, approximately 30% (60,000) will remain at large for at least a year.² Virginia’s portion of these individuals is a not-inconsiderable number. These fugitives impose significant costs on society. These costs would include those associated with lost court time and resources. Since approximately 16% of released defendants are rearrested for crimes committed while awaiting trial (and the actual percent of released individuals who commit crimes while awaiting trial is even higher than that), society also incurs a cost associated with higher crime. This cost may increase if fugitive rates for bonded defendants increase.

Whether the costs associated with licensing of bounty hunters outweigh the benefits will largely depend on whether licensure restrictions curtail further incidents of public harm caused by overzealous or unethical bounty hunters.

Businesses and Entities Affected. Bail bondsmen and bounty hunters currently practicing in the Commonwealth, as well as individuals who may want to join these occupations in the future, will be affected by the proposed regulation. Currently, DCJS licenses 378 bail bondsmen and 73 bounty hunters. Localities and the state will also likely be affected since these entities will absorb any extra jail expenditures brought about by the legislation that initiated this proposed regulation.

Localities Particularly Affected. Changes in the number and (potentially) the effectiveness of bounty hunters will likely mean that prisoners free on bond who choose to flee will be found and brought back for trial less often. When prisoners become fugitives, and remain at large, bail bondsmen have to forfeit their bonds to the court. Bail bondsmen are likely to respond to these monetary losses by refusing to offer bail to riskier prisoners. Other things remaining equal, this will mean that more prisoners will remain in jail longer or until their trial instead of being released. If this happens, and preliminary data would support that it will, the costs that localities and the state pay to house prisoners in jail will increase. The daily cost increase will be equal to the number of prisoners now housed (either until trial or during a more lengthy search for bond) rather than being released times the cost per day for housing, feeding clothing and guarding each prisoner in jail. This cost will likely fall disproportionately on localities that house their prisoners in regional jails.

Projected Impact on Employment. The legislation that initiated this proposed regulation has reduced the number of individuals employed as bounty hunters. The magnitude of this reduction is unknown since there is no data on the number of bounty hunters who practiced in the state before licensure. It is likely, however, that bounty hunters experienced at least as great a drop in numbers as did bail bondsmen post licensure. The number of bail bondsmen fell from around 1,300 pre-licensure to approximately 380 post-licensure. Assuming comparable decreases, there would have been approximately 250 bounty hunters practicing in the Commonwealth prior to licensure. Additionally, the number of bail bondsmen practicing in Virginia may fall further if bail defaults increase enough to drive defaulting bondsmen out of business.

Effects on the Use and Value of Private Property. The value of bail bondsmen businesses may decrease if bail defaults increase. Property bail bondsmen, in particular, may lose any property used to secure bonds for prisoners who skip out on their court dates and are not found.

Small Businesses: Costs and Other Effects. Bail bondsmen may incur costs associated with increased bail defaults. Bounty hunters will incur costs for keeping records on all bail recoveries for three years as required by the proposed regulation. They will also incur explicit cost for training and licensure fees as well as opportunity costs associated with time spent getting and maintaining their licensure that could have been spent elsewhere.

Small Businesses: Alternative Method that Minimizes Adverse Impact. Within the confines of legislative requirements for this licensure program, there is likely no alternate method that the Board could have employed to minimize most adverse effects of this regulatory program. The Board might choose to rewrite this proposed regulation to remove the requirement that bounty hunters who do not renew their licenses on time, or within the 60 day reinstatement period, take all initial core training again. Specifically, the costs associated with re-obtaining a license would be minimized if applicants only had to complete extra hours of core education if the core education requirements have increased since initial licensure was first obtained.

References. Hellend, Eric and Tabarrok, Alexander. "The Fugitive: Evidence of Public versus Private Law Enforcement from Bail Jumping." Journal of Law and Economics, Vol XLVII. April 2004.

Legal Mandate. The Department of Planning and Budget (DPB) has analyzed the economic impact of this proposed regulation in accordance with § 2.2-4007.04 of the Administrative Process Act and Executive Order Number 21 (02). Section 2.2-4007.04 requires that such economic impact analyses include, but need not be limited to, the projected number of businesses or other entities to whom the regulation would apply, the identity of any localities and types of businesses or other entities particularly affected, the projected number of persons and employment positions to be affected, the projected costs to affected businesses or entities to implement or comply with the regulation, and the impact on the use and value of private property. Further, if the proposed regulation has adverse effect on small businesses, § 2.2-4007.04 requires that such economic impact analyses include (i) an identification and estimate of the number of small businesses subject to the regulation; (ii) the projected reporting, recordkeeping, and other administrative costs required for small businesses to comply with the regulation, including the type of professional skills necessary for preparing required reports and other documents; (iii) a statement of the probable effect of the regulation on affected small businesses; and (iv) a description of any less intrusive or less costly alternative methods of achieving the purpose of the regulation. The analysis presented above represents DPB’s best estimate of these economic impacts.

¹ Total jail populations grew at an average annual rate of 4.2% from FY 2001 through FY 2005. In FY 2006 (the year after implementation of bail enforcement agent licensure), total jail populations grew 9.96%. Growth rate changes for the jail subpopulation consisting of unsentenced individuals awaiting trial are even more startling. This subpopulation had an average annual growth rate of 4.3% from FY 2001 through FY 2005. In FY 2006, this subpopulation grew 12.7%. Jail populations have not experienced a comparable growth rate since FY 2000 when Virginia implemented bail reform.

² Source: Hellend and Tabarrok (2004)

Agency's Response to the Department of Planning and Budget's Economic Impact Analysis: The Department of Criminal Justice Services concurs generally with the Economic Impact Analysis (EIA) of the Department of Planning and Budget on the proposed Regulations Relating to Bail Enforcement Agents with one exception.

Under the Small Businesses: Alternative Method that Minimizes Adverse Impact, DBP recommended that the agency remove the requirement that bounty hunters who do not renew their licenses on time or within the 60-day reinstatement period are then required to meet initial core training.

The provision in question is in reference to bail enforcement agent in-service training requirements. The applicants are required to take a 40-hour entry-level training prior to licensure. In order to renew the license, they are required to complete an eight-hour in-service training session during the last 12 months of a two-year license. The department had added the provision that if in-service training is not completed by their expiration date then they are required to meet all initial training requirements. This did not allow for any reinstatement period.

The Code of Virginia specifically provides that the department establish compulsory minimum training standards that shall ensure public safety and welfare from incompetent or unqualified persons engaging in bail enforcement activities. Furthermore, the department is required to ensure continued competency of the regulated community.

Section 9.1-186.6 of the Code of Virginia specifically states that prior to renewing the two-year license, the applicant must: complete eight hours of continuing education approved by the department and that any license not renewed by its expiration date shall terminate on such date.

This requirement was added to clarify to the applicant the penalty for not meeting renewal requirements and to encourage applicants to stay in compliance with the regulations. This is consistent with all other regulatory programs under the authority of the Private Security Services Section of the Department of Criminal Justice Services. They have 12 months to take an eight-hour course as well as a provision to extend this requirement under an emergency situation, such as illness, injury or active duty (6VAC 20-260-170), as well as a provision that they may receive alternate in-service credit for taking training that meets or exceeds the standards promulgated by the board (6VAC 20-260-150).

DPB’s concern was over the provision that the requirement of retaking entry-level training again was too harsh a penalty. The agency agrees that it was too harsh to require entry-level training if requirements were not met by the expiration date of the license, but does not agree that it is too harsh a penalty to require entry-level training if training was not met within an additional 60-day reinstatement period after the expiration of the license. The agency has rewritten the regulations to incorporate a 60-day reinstatement period in which to meet renewal requirements.

Summary:

The proposed regulation establishes a licensure process, licensure fees, compulsory minimum entry-level training standards, including firearms training and qualifications, standards of conduct, and administration of the regulatory system. It provides procedures for receiving complaints concerning the conduct of any person whose activities are monitored by the board; conducting investigations; issuing disciplinary action; revoking, suspending, or refusing to renew a license; and an appeal process pursuant to the Administrative Process Act.

CHAPTER 260
REGULATIONS RELATING TO BAIL ENFORCEMENT AGENTS

Part I
Definitions

6VAC20-260-10. Definitions.

The following words and terms when used in this regulation shall have the following meanings unless the context clearly indicates otherwise:

"Armed" means a bail enforcement agent who carries or has immediate access to a firearm in the performance of his duties.

"Bail bondsman" means any person who is licensed by the department who engages in the business of bail bonding and is thereby authorized to conduct business in all courts of the Commonwealth.

"Bail enforcement agent," also known as "bounty hunter," means any individual engaged in bail recovery.

"Bail recovery" means an act whereby a person arrests a bailee with the object of surrendering the bailee to the appropriate court, jail, or police department for the purpose of discharging the bailee's surety from liability on his bond. Bail recovery shall include investigating, surveilling or locating a bailee in preparation for an imminent arrest, with such object and for such purpose.

"Bailee" means a person who has been released on bail and who is or has been subject to a bond as defined in § 19.2-119 of the Code of Virginia.

"Board" means the Criminal Justice Services Board or any successor board or agency.

"Department" or "DCJS" means the Department of Criminal Justice Services or any successor agency.

"Firearms endorsement" means a method of regulation that identifies a person licensed as a bail enforcement agent who has successfully completed the annual firearms training and has met the requirements as set forth in this regulation.

"On duty" means the time during which bail enforcement agents receive or are entitled to receive compensation for employment for which licensure is required.

"Private security services training school" means a training school that is certified or licensed by the department for the specific purpose of training regulated personnel in at least one category of the compulsory minimum training standards.

Part II
Fees

6VAC20-260-20. Fees.

A. Schedule of fees. The following fees reflect the costs of handling, issuance, and production associated with administering and processing applications for licensing and other administrative requests for services relating to bail enforcement services:

B. Reinstatement fee.

1. The department shall collect a reinstatement fee for license renewal applications not received on or before the expiration date of the expiring license.

2. The reinstatement fee shall be 50% above and beyond the renewal fee of the license or any other credential issued by the department wherein a fee is established and renewal is required.

C. Dishonor of fee payment due to nonsufficient funds.

1. The department may suspend the license it has granted any person who submits a check or similar instrument for payment of a fee required by statute or regulation that is not honored by the financial institution upon which the check or similar instrument is drawn.

2. The suspension shall become effective upon receipt of written notice of the dishonored payment. Upon notification of the suspension, the licensee may request that the suspended license or authority be reinstated, provided payment of the dishonored amount plus any penalties or fees required under the statute or regulation accompanies the request. Suspension under this provision shall be exempt from the Administrative Process Act.

Part III
Licensing Procedures and Requirements

6VAC20-260-30. Bail enforcement agent eligibility.

A. Persons required to be licensed pursuant to subdivision 47 of § 9.1-102 of the Code of Virginia as a bail enforcement agent shall meet all licensure requirements in this section. Persons who carry or have access to a firearm while on duty must have a valid license with a firearms endorsement as described under 6VAC20-260-80. If carrying a handgun concealed, the person must also have a valid concealed handgun permit and the written permission of his employer pursuant to § 18.2-308 of the Code of Virginia.

B. Each person applying for a bail enforcement agent license shall meet the minimum requirements for eligibility as follows:

1. Be a minimum of 21 years of age;

2. Be a United States citizen or legal resident alien of the United States;

3. Have received a high school diploma or GED; and

4. Have successfully completed all initial training requirements, including firearms endorsement if applicable, requested pursuant to the compulsory minimum training standards in Part IV (6 VAC 20-260-120 et seq.) of this regulation.

C. The following persons are not eligible for licensure as a bail enforcement agent and may not be employed by or serve as agents for a bail enforcement agent:

1. Persons who have been convicted of a felony within the Commonwealth, any other state, or the United States, who have not been pardoned, or whose civil rights have not been restored.

2. Persons who have been convicted of any misdemeanor within the Commonwealth, any other state, or the United States within the preceding five years. This prohibition may be waived by the department, for good cause shown, so long as the conviction was not for one of the following or a substantially similar misdemeanor: carrying a concealed weapon, assault and battery, sexual battery, a drug offense, driving under the influence, discharging a firearm, a sex offense, or larceny.

3. Persons who have been convicted of any misdemeanor within the Commonwealth, any other state, or the United States, that is substantially similar to the following: brandishing a firearm or stalking. The department may not waive the prohibitions under this subdivision.

4. Persons currently the subject of a protective order within the Commonwealth or another state.

5. Employees of a local or regional jail.

6. Employees of a sheriff's office or a state or local police department.

7. Commonwealth's attorneys and any employees of their offices.

8. Employees of the Department of Corrections, Department of Criminal Justice Services, or a local pretrial or community-based probation services agency.

D. The exclusions in subsection C of this section shall not be construed to prohibit law enforcement from accompanying a bail enforcement agent when he engages in bail recovery.

6VAC20-260-40. Initial bail enforcement agent license application.

Prior to the issuance of any bail enforcement agent license, each agent applicant shall:

1. File with the department a completed application for such license on the form and in the manner provided by the department;

2. Provide the address of a physical location in Virginia where records required to be maintained pursuant to 6VAC20-260-230 are kept and available for inspection by the department. A post office box is not a physical location;

3. Successfully complete entry-level training, and firearms training if applicable, pursuant to the compulsory minimum training standards set forth under Part IV (6VAC20-260-120 et seq.) of this regulation;

4. Submit fingerprints to the department pursuant to 6VAC20-260-50; and

5. Submit the appropriate nonrefundable application processing fee to the department.

6VAC20-260-50. Fingerprint processing.

A. Each person applying for licensure as a bail enforcement agent shall submit to the department:

1. One completed fingerprint card provided by the department or another electronic method approved by the department;

2. A fingerprint processing application;

3. The applicable nonrefundable fee; and

4. All criminal history conviction information on a form provided by the department.

B. The department shall submit those fingerprints to the Virginia State Police for the purpose of conducting a Virginia Criminal History Records search and a National Criminal Records search to determine whether the person or persons has a record of conviction.

C. Fingerprint cards found to be unclassifiable will suspend action on the application pending the resubmittal of a classifiable fingerprint card. The applicant shall be so notified in writing and shall submit a new fingerprint card within 30 days before the processing of his application shall resume. After 30 days, the initial fingerprint application process will be required to include applicable application fees.

D. If the applicant is denied by DCJS, the department will notify the applicant by letter regarding the reasons for the denial.

6VAC20-260-60. Application sanctions/denial, probation, suspension and revocation.

A. The department may deny a license in which any person has been convicted in any jurisdiction of any felony. Any plea of nolo contendere shall be considered a conviction for the purposes of this regulation. The record of a conviction, authenticated in such form as to be admissible in evidence under the laws of the jurisdiction where convicted, shall be admissible as prima facie evidence of such conviction.

B. The department may deny a license in which any person (i) has not maintained good standing in every jurisdiction where licensed; (ii) has had his license denied upon initial application, suspended, revoked, surrendered, or not renewed; or (iii) has otherwise been disciplined in connection with a disciplinary action prior to applying for licensing in Virginia.

C. Any false or misleading statement on any state application or supporting documentation is grounds for denial or revocation and may be subject to criminal prosecution.

D. The department may deny licensure to a person for other just cause.

E. A licensee shall be subject to disciplinary action for violations or noncompliance with the Code of Virginia or this regulation. Disciplinary action shall be in accordance with procedures prescribed by the Administrative Process Act. The disciplinary action may include but is not limited to a letter of censure, fine, probation, suspension or revocation.

6VAC20-260-70. License issuance.

A. Upon completion of the initial license application requirements, the department may issue an initial license for a period not to exceed 24 months.

B. Each license shall be issued to the applicant named on the application and shall be valid only for the person named on the license. No license shall be assigned or otherwise transferred to another person.

C. Each licensee shall comply with all applicable administrative requirements and standards of conduct and shall not engage in any acts prohibited by applicable sections of the Code of Virginia and this regulation.

D. At the discretion of the department, a temporary license may be issued for a 30-day period while awaiting the results of the applicant's criminal history records search based on extenuating circumstances.

6VAC20-260-80. Firearms endorsement.

A. In addition to applying for a bail enforcement agent license, each applicant who carries or has access to a firearm while on duty must apply for such endorsement on a form and in the manner prescribed by the board and containing any information the board requires.

B. Prior to the issuance of a firearms endorsement, each applicant shall:

1. Successfully complete the entry-level firearms training pursuant to the compulsory minimum training standards as set forth in Part IV (6VAC20-260-120 et seq.) of this regulation; and

2. Submit the appropriate nonrefundable application processing fee to the department.

C. Upon completion of the application requirements, the department may issue a firearms endorsement for a period not to exceed 12 months.

D. Firearms endorsements may be reissued for a period not to exceed a period of 12 months when the applicant has met the following requirements:

1. Filed with the department a completed application for such endorsement on the form and in the manner provided by the department at least 30 days prior to expiration of the current endorsement;

2. Successfully completed the firearms retraining, pursuant to the compulsory minimum training standards set forth under Part IV (6VAC20-260-120 et seq.) of this regulation; and

3. Submitted the appropriate nonrefundable application processing fee to the department.

6VAC20-260-90. License renewal application.

A. The department should receive applications for licensure renewal at least 30 days prior to expiration. The department will provide a renewal notification to the last known mailing address of the licensed person. However, if a renewal notification is not received by the person, it is the responsibility of the person to ensure renewal requirements are filed with the department. License renewal applications must be received by the department and all license requirements must be completed prior to the expiration date or shall be subject to all applicable, nonrefundable renewal fees plus reinstatement fees. Outstanding fees or monetary penalties owed to DCJS must be paid prior to issuance of a renewal.

B. Each person applying for license renewal shall meet the minimum requirements for eligibility as follows:

1. Successfully complete the in-service training, and firearms retraining if applicable, pursuant to the compulsory minimum training standards set forth under Part IV (6VAC20-260-120 et seq.) of this regulation;

2. Be in good standing in every jurisdiction where licensed. This subdivision shall not apply to any probationary periods during which the person is eligible to operate under the license; and

3. Maintain eligibility pursuant to 6VAC20-260-30 B.

C. The department may renew a license when the department receives the following:

1. A properly completed renewal application provided by the department;

2. Fingerprint cards submitted pursuant to 6VAC20-260-50;

3. The applicable, nonrefundable license renewal fee; and

4. Proof of successful completion of the in-service training, pursuant to the compulsory minimum training standards set forth under Part IV (6VAC20-260-120 et seq.) of this regulation.

D. Upon completion of the renewal license application requirements, the department may issue a license for a period not to exceed 24 months.

E. Any renewal application received after the expiration date of a license shall be subject to the requirements set forth by the reinstatement provisions of this chapter.

6VAC20-260-100. Replacement state-issued identification.

A licensed person seeking a replacement state-issued photo identification shall submit to the department:

1. A properly completed application provided by the department; and

2. The applicable, nonrefundable application fee.

6VAC20-260-110. Reinstatement.

A. A bail enforcement agent license not renewed on or before the expiration date shall become null and void. Pursuant to the Code of Virginia, all such persons must currently be licensed with the department to provide bail enforcement agent services.

B. A renewal application must be received by the department within 60 days following the expiration date of the license in order to be reinstated by the department, providing all renewal requirements have been met. Prior to reinstatement, the following shall be submitted to the department:

1. The appropriate renewal application and completion of renewal requirements, including required training pursuant to this chapter; and

2. The applicable, nonrefundable reinstatement fee pursuant to this chapter and in accordance with 6VAC20-260-20 B.

The department shall not reinstate renewal applications received after the 60-day reinstatement period has expired. It is unlawful to operate without a valid license including during a reinstatement period.

C. No license shall be renewed or reinstated when all renewal application requirements are received by the department more than 60 days following the expiration date of the license. After that date, the applicant shall meet all initial application requirements, including applicable training requirements.

D. Following submittal of all reinstatement requirements, the department will process and may approve any application for reinstatement pursuant to the renewal process for the application.

Part IV
Compulsory Minimum Training Standards for Bail Enforcement Agents

Article 1
Training Requirements

6VAC20-260-120. Entry-level training.

A. Each bail enforcement agent as defined by § 9.1-186 of the Code of Virginia must meet the compulsory minimum training standards established in this part unless provided for otherwise in accordance with this regulation.

B. Training will be credited only if application for licensure is submitted to the department within 12 months of completion of training.

C. The compulsory minimum entry-level training hour requirement by category, excluding examinations, practical exercises and range qualification, shall be:

1. Bail Enforcement Core Training -- 40 hours.

2. Firearms Training -- 14 hours.

D. The compulsory minimum entry-level training course content, excluding examinations, mandated practical exercises and range qualification, shall be as provided in this subsection.

Core subjects. The entry-level curriculum sets forth the following areas identified as:

I. Orientation: ethics -- 2 hours

A. Ethics

1. Professionalism

2. Conflict of Interest

3. Code of Ethics

II. Law: Code of Virginia and Regulations; basic law; courts; and bail enforcement -- 12 hours + 1 practical exercise

A. Code of Virginia and Regulations

1. Definitions

2. Licensing Procedures and Requirements

3. Compulsory Minimum Training Standards

4. Standards of Practice and Prohibited Acts

5. Administrative Requirements/Standards of Conduct

6. Administrative Reviews, Complaints, Procedures

B. Basic Law

1. Legal Terminology and Definitions

2. Purpose and Function of Law

3. U.S. Constitution

a. Bill of Rights

b. Amendments

4. Code of Virginia

a. Bail Bonding Laws

b. Laws of Arrest

5. Landmark Cases

a. Taylor v. Taintor

b. Old Fugitive Slave Laws

6. Virginia Cases

7. Limitations and Liabilities

C. Courts

1. Federal Court System

a. Criminal

b. Civil

2. State Court System

a. Criminal

b. Civil

D. Bail Enforcement

1. Right to Arrest

2. Search and Seizure

3. Uniform Extradition Act

4. Virginia Extradition Procedures

5. Legal and Criminal Forms

III. Fugitive Recovery: investigative techniques; recovery procedures; agent survival; and apprehension of a fugitive -- 24 hours + 1 practical exercise

A. Investigative Techniques

1. Surveillance

2. Court Research

3. Law Enforcement Coordination

4. Interviewing

5. Impersonation and Misrepresentation

6. Reference Materials and Resource List

7. Skip Tracing Techniques

8. Fugitive Identification

B. Recovery Procedures

1. Pursuit

a. Foot

b. Vehicular

c. Other

2. Entry and Search

3. Perimeter/Interior Room Control

C. Agent Survival

1. Confrontation Management

2. Use of Force

3. Deadly Force

4. Escalation of Force

5. Emergency Procedures

D. Apprehension of a Fugitive

1. Compliant versus Noncompliant Procedures

2. Search of Person

a. Personal Items

b. Seizure of Contraband

3. Handcuffing Techniques

4. Rights of the Accused

5. Detainment and Transportation

6. Interstate Transport

7. False Arrest

IV. Remanding to Custody: legal detainment facilities; entering the jail or sally port; signing the bail piece/return to court; and hospital procedures for injuries -- 2 hours + 1 practical exercise

A. Legal Detainment Facilities

B. Entering the Jail or Sally Port

C. Signing the Bail Piece/Return to Court

D. Hospital Procedures for Injuries

V. Written Comprehensive Examination.

6VAC20-260-130. In-service training.

A. Each person licensed with the department as a bail enforcement agent shall complete the compulsory in-service training standards within the last 12 months preceding the expiration date of licensure.

B. The compulsory minimum in-service training course content by category, excluding examinations, practical exercises and range qualification, shall be as follows:

Bail enforcement core subjects:

1. Legal authority -- 2 hours

2. Job-related training -- 6 hours

Total hours -- 8 hours

6VAC20-260-140. Training exemption.

Persons who meet the statutory requirements as set forth in § 9.1-186 of the Code of Virginia may apply for a partial exemption from the compulsory training standards. Individuals requesting such partial exemption shall file an application furnished by the department and include the applicable, nonrefundable application fee. The department may issue such partial exemption on the basis of individual qualifications as supported by required documentation. Those applying for and receiving exemptions must comply with all regulations promulgated by the board. Each person receiving a partial exemption must apply to the department for registration within 12 months from the date of issuance; otherwise the partial exemption shall become null and void.

6VAC20-260-150. Entry-level training exemption.

A. Persons previously employed as law-enforcement officers for a local, state or federal government who have not terminated or been terminated from the employment more than five years prior to the application date must submit official documentation of the following with the application for partial exemption of the entry-level training requirements:

1. Completion of law-enforcement entry-level training; and

2. Five continuous years of law-enforcement employment, provided such employment as a law-enforcement officer was not terminated due to misconduct or incompetence.

B. Persons having previous bail enforcement agent training and five years continuous experience must submit official documentation of the following with the application for partial exemption:

1. Completion of previous bail enforcement agent training, which has been approved by the department and which meets or exceeds the compulsory minimum training standards promulgated by the board; and

2. Five years continuous experience in bail recovery, provided such experience did not end more then 12 months prior to submittal of licensure application.

6VAC20-260-160. In-service alternative training credit.

Persons who have completed training that meets or exceeds the compulsory minimum training standards promulgated by the board for the in-service training required for bail enforcement agents may be authorized credit for such training, provided the training has been completed within 12 months of the expiration date of the license period during which in-service training is required. Such training must be provided by a third party organization offering services or expertise for the particular training category. Official documentation of the following must accompany the application for in-service training credit:

1. Information regarding the sponsoring organization, including documentation regarding the instructor for each session;

2. An outline of the training session material, including the dates, times and specific subject matter;

3. Proof of attendance and successful completion; and

4. The applicable, nonrefundable application fee.

6VAC20-260-170. Prior firearms training exemption.

Persons having previous department-approved firearms training may be authorized credit for such training that meets or exceeds the compulsory minimum training standards for private security services business personnel, provided such training has been completed within the 12 months preceding the date of application. Official documentation of the following must accompany the application for partial in-service training credit:

1. Completion of department-approved firearms training; and

2. Qualification at a Virginia criminal justice agency, academy or correctional department.

6VAC20-260-180. Renewal extension.

A. An extension of the time period to meet in-service training requirements for renewal of a license may be approved only under specific circumstances that do not allow bail enforcement agents to complete the required renewal procedures within the prescribed time period. The following are the only circumstances for which extensions may be granted:

1. Extended illness,

2. Extended injury, or

3. Military deployment.

B. A request for extension shall:

1. Be submitted in writing, dated and signed by the licensee prior to the expiration date of the time limit required for completion of the requirements. This requirement may be waived by the department in cases of military deployment;

2. Indicate the projected date the person will be able to comply with the requirements; and

3. Include a copy of the physician's record of the injury or illness or a copy of the government orders.

C. No extension will be approved for licenses that have expired except in the cases involving military deployment.

D. Applications for additional extensions may be approved upon written request of the licensee.

E. Approved extensions may only be granted for a period not to exceed 12 months.

F. The bail enforcement agent shall be nonoperational during the period of extension.

Article 2
Firearms Training Requirements

6VAC20-260-190. General firearms training requirements.

Firearms training endorsement is required for all bail enforcement agents who carry or have access to a firearm while on duty. Each person who carries or has access to firearms while on duty shall qualify with each type of action and caliber of firearm to which he has access.

6VAC20-260-200. Firearms (handgun/shotgun) entry-level training.

All armed bail enforcement agents must satisfactorily complete the firearms classroom training, practical exercises and range training as prescribed in 6VAC20-171, Regulations Relating to Private Security Services, for handgun and for shotgun, if applicable, prior to the issuance of the firearms endorsement.

6VAC20-260-210. Firearms (handgun/shotgun) retraining.

On an annual basis all armed bail enforcement agents must requalify for a firearms endorsement by satisfactorily completing firearms classroom training, practical exercises and range training as prescribed in 6VAC20-171, Regulations Relating to Private Security Services, for handgun and for shotgun, if applicable.

Article 3
Training Sessions

6VAC20-260-220. Bail enforcement and firearms training sessions.

A. Training sessions will be conducted by private security services training schools certified or licensed under 6VAC20-171, Regulations Relating to Private Security Services, in accordance with requirements established in this chapter. Adherence to the administrative requirements, attendance and standards of conduct are the responsibility of the training school, training school director and instructor of the training session.

B. Administrative requirements.

1. In a manner approved by the department, a notification to conduct a training session shall be publicly accessible and submitted to the department upon request. All notifications shall be posted no less than seven calendar days prior to the beginning of each training session to include the date, time, instructors and location of the training session. The department may allow a session to be conducted with less than seven calendar days of notification with prior approval. A notification to conduct a training session shall be deemed to be in compliance unless the training school director is notified by the department to the contrary.

2. Notification of any changes to the dates, times, location or cancellation of a future training session must be made at least 24 hours in advance of the scheduled starting time of the class. In the event that a session must be cancelled on the scheduled date, the department must be notified immediately.

3. On a form provided by the department, the training school director shall issue an original training completion form and training certificate to each student who satisfactorily completes a training session no later than five business days following the training completion date.

4. In a manner approved by the department, the training school director shall maintain an original training completion roster and submit to the department upon request, affirming each student's successful completion of the session.

5. A written examination shall be administered at the conclusion of each entry-level training session. The examination shall be based on the applicable learning objectives. The student must attain a minimum grade of 70% for all entry-level training examinations to satisfactorily complete the training session.

6. Firearms classroom training shall be separately tested and graded. Individuals must achieve a minimum score of 70% on the firearms classroom training examination.

7. Failure to achieve a minimum score of 70% on the firearms classroom written examination will exclude the individual from the firearms range training.

8. To successfully complete the firearms range training, the individual must achieve a minimum qualification score of 75% of the scoring value of the target.

9. To successfully complete the bail enforcement agent entry-level training session, the individual must:

a. Successfully complete each of the three graded practical exercises required, and

b. Pass the written examination with a minimum score of 70%.

C. Attendance.

1. Individuals enrolled in an approved training session are required to be present for the hours required for each training session unless they have been granted a partial exemption to training from the department.

2. Tardiness and absenteeism will not be permitted. Individuals violating these provisions will be required to make up any training missed. Such training must be completed within 60 days after the completion of the training session or at the next available session offered by the training school. Individuals not completing the required training within this period are required to complete the entire training session.

3. Individuals who do not successfully complete the compulsory minimum training standards of the training session shall not be reported to the department except where required pursuant to this chapter.

4. Each individual attending an approved training session shall comply with the regulations promulgated by the board and any other rules within the authority of the training school. If the training school director or instructor considers a violation of the rules detrimental to the training of other students or to involve cheating on examinations, the training school director or instructor may expel the individual from the school. Notification of such action shall immediately be reported to the employing firms and the department.

D. Standards of conduct.

1. The training school, training school director and instructor shall at all times conform to the application requirements, administrative requirements and standards of conduct established for certification as a training school and instructor.

2. Training sessions will be conducted by certified instructors or other individuals authorized to provide instruction pursuant to this chapter.

3. Training sessions will be conducted utilizing lesson plans developed, including at a minimum the compulsory minimum training standards established pursuant to this chapter.

4. Instruction shall be provided in no less than 50-minute classes.

5. Training sessions may not exceed nine hours of classroom instruction per day. Range qualification and practical exercises shall not be considered classroom instruction; however, total training, including the maximum allotment of nine hours classroom instruction and applicable range qualification and practical exercises, shall not exceed 12 hours per day. This does not include time allotted for breaks, meals and testing.

6. All audiovisual training aids must be accompanied by a period of instruction where the instructor reviews the content of the presentation and the students are provided the opportunity to ask questions regarding the content.

7. A training session must adhere to the minimum compulsory training standards and must be presented in its entirety. Training school directors may require additional hours of instruction, testing or evaluation procedures.

8. A training session must provide accurate and current information to the students.

9. Mandated training conducted not in accordance with the Code of Virginia and this chapter is null and void.

10. A duplicate set of instructor course materials including all student materials shall be made available to any department inspector during the training session, if requested.

Part V
Recordkeeping Standards and Reporting Requirements

6VAC20-260-230. Reporting standards and requirements.

A. Each licensed bail enforcement agent shall report within 30 calendar days to the department any change in his residence, name, or business name or business address, and ensure that the department has the names and fictitious names of all companies under which he carries out his bail recovery business.

B. Each licensed bail enforcement agent arrested or issued a summons for any crime shall report such fact within 30 calendar days to the department and shall report to the department within 30 days the facts and circumstances regarding the final disposition of his case.

C. Each licensed bail enforcement agent shall report to the department within 30 calendar days of the final disposition any administrative action taken against him by another governmental agency in this Commonwealth or in another jurisdiction. Such report shall include a copy of the order, consent to order or other relevant legal documents.

D. Each licensed bail enforcement agent shall report to the department within 24 hours any event in which he discharges a firearm during the course of his duties.

E. The bail enforcement agent shall retain, for a minimum of three calendar years from the date of a recovery, copies of all written documentation in connection with the recovery of a bailee pursuant to 6VAC20-260-260.

Part VI
Administrative Requirements; Standards of Conduct

6VAC20-260-240. General requirements.

All bail enforcement agents are required to maintain administrative requirements and standards of conduct as determined by the Code of Virginia, department guidelines and this regulation.

6VAC20-260-250. Professional conduct standards; grounds for disciplinary actions.

A. Any violations of the restrictions or standards under the Code of Virginia or this regulation shall be grounds for placing on probation, refusal to issue or renew, sanctioning, suspension or revocation of the bail enforcement agent's license. A licensed bail enforcement agent is responsible for ensuring that his employees, partners and individuals contracted to perform services for or on his behalf comply with all of these provisions and do not violate any of the restrictions that apply to bail enforcement agents. Violations by a bail enforcement agent's employee, partner, or agent may be grounds for disciplinary action against the bail enforcement agent, including probation, suspension or revocation of license.

B. A licensed bail enforcement agent shall not:

1. Engage in any fraud or willful misrepresentation, or provide materially incorrect, misleading, incomplete or untrue information in applying for an original license or renewal of an existing license, or in submitting any documents to the department.

2. Use any letterhead, advertising, or other printed matter in any manner representing that he is an agent, employee, or instrumentality of the federal government, a state, or any political subdivision of a state.

3. Impersonate, permit or aid and abet any employee to impersonate a law-enforcement officer or employee of the United States, any state, or a political subdivision of a state.

4. Use a name different from that under which he is currently licensed for any advertising, solicitation, or contract to secure business unless the name is an authorized fictitious name.

5. Coerce, suggest, aid and abet, offer promise of favor, or threaten any person to induce that person to commit any crime.

6. Give or receive, directly or indirectly, any gift of any kind to any nonelected public official or any employee of a governmental agency involved with the administration of justice, including but not limited to law-enforcement personnel, magistrates, judges, jail employees, and attorneys. De minimis gifts, not to exceed $50 per year per recipient, are acceptable provided the purpose of the gift is not to directly solicit business or would otherwise be a violation of department regulations or the laws of the Commonwealth.

7. Knowingly violate, advise, encourage, or assist in the violation of any statute, local jurisdictional law, court order, or injunction in the course of conducting activities regulated under this chapter.

8. Solicit business for an attorney in return for compensation.

9. Willfully neglect to render to a client services or a report as agreed between the parties and for which compensation has been paid or tendered in accordance with the agreement of the parties, but if the bail enforcement agent chooses to withdraw from the case and returns the funds for work not yet done, no violation of this section exists.

10. Fail to comply with any of the statutory or regulatory requirements governing licensed bail enforcement agents.

11. Fail or refuse to cooperate with any investigation by the department.

12. Fail to comply with any subpoena issued by the department.

13. Employ or contract with any unlicensed or improperly licensed person or agency to conduct activities pertaining to bail enforcement services regulated in the Code of Virginia or this regulation, if the licensure status was known or could have been ascertained by reasonable inquiry.

14. Solicit or receive a bribe or other consideration in exchange for failing to recover or detain a bailee.

15. Provide false or misleading information to representatives of the department.

C. The department shall have the authority to place on probation, suspend or revoke a bail enforcement agent's license if an agent is arrested or issued a summons for a criminal offense, or becomes the subject of a protective order.

6VAC20-260-260. Recovery of bailees; methods of capture; standards and requirements; limitations.

A. During the recovery of a bailee, a bail enforcement agent shall have a copy of the relevant recognizance for the bailee. He shall also have written authorization from the bailee's bondsman, obtained prior to effecting the capture. The department shall develop the written authorization form to be used in such circumstances.

B. A bail enforcement agent shall not enter a residential structure without first verbally notifying the occupants who are present at the time of the entry.

C. Absent exigent circumstances, a bail enforcement agent shall give prior notification of at least 24 hours to local law enforcement or state police of the intent to apprehend a bailee. In all cases, a bail enforcement agent shall inform local law enforcement within 60 minutes of capturing a bailee.

D. In the apprehension of a bailee, the bail enforcement agent shall provide a written inventory of items taken into possession to both the bailee as well as the legal detainment facility.

E. A bail enforcement agent shall not utilize a canine or security rifle in the performance of bail recovery.

F. A bail enforcement agent may not transfer a bailee to an unlicensed bail bondsman or bail enforcement agent within the Commonwealth of Virginia.

G. A bail enforcement agent shall not break any laws of the Commonwealth in the act of apprehending a bailee.

H. A bail enforcement agent shall adhere to the recovery requirements pursuant to § 19.2-149 of the Code of Virginia.

I. A bail enforcement agent must complete and maintain the information on the recovery of a bailee on a form prescribed by the department.

6VAC20-260-270. Uniforms and identification; standards and restrictions.

A. A bail enforcement agent shall not wear, carry, or display any uniform, badge, shield, or other insignia or emblem that implies he is an agent of state, local, or federal government.

B. A bail enforcement agent shall wear or display only identification issued by, or whose design has been approved by, the department.

Part VII
Complaints, Department Actions, Adjudication

Article 1
Complaints

6VAC20-260-280. Submittal requirements.

A. Any aggrieved or interested person may file a complaint against any person whose conduct and activities are regulated or required to be regulated by the board. The complaint must allege a violation of the law governing bail enforcement services or this regulation.

B. Complaints may be submitted:

1. In writing, or on a form provided by the department, by a signed complainant;

2. In writing, submitted anonymously, that provide sufficient detailed information for the department to conduct an investigation; or

3. Telephonically, providing the complaint alleges activities that constitute a life-threatening situation, have resulted in personal injury or loss to the public or to a consumer, or may result in imminent harm or personal injury, and that provide sufficient detailed information for the department to conduct an investigation.

6VAC20-260-290. Department investigation.

A. The department may initiate or conduct an investigation based on any information received or action taken by the department to determine compliance with the Code of Virginia and this regulation.

B. Documentation.

1. Persons regulated or required to be regulated by this regulation pursuant to the Code of Virginia are required to provide department investigators with any and all records required to be maintained by this regulation.

a. This shall not be construed to authorize the department to demand records protected under applicable federal and state laws. If such records are necessary to complete an investigation, the department may seek a subpoena to satisfy the request.

b. The department shall endeavor to review, and request as necessary, only those records required to verify alleged violations of compliance with the Code of Virginia and this regulation.

2. The department shall endeavor to keep any documentation, evidence or information on an investigation confidential until such time as adjudication has been completed, at which time information may be released upon request pursuant to applicable federal and state laws, rules or regulations.

Article 2
Department Actions

6VAC20-260-300. Penalties: criminal and monetary.

A. Any person who engages in bail recovery in the Commonwealth without a valid license issued by the department is guilty of a Class 1 misdemeanor. A third conviction under this section is a Class 6 felony.

B. Any person who violates any statute or board regulation who is not criminally prosecuted shall be subject to the monetary penalty provided in this section. If the board determines that a respondent is guilty of the violation complained of, the board shall determine the amount of the monetary penalty for the violation, which shall not exceed $2,500 for each violation. The penalty may be sued for and recovered in the name of the Commonwealth.

6VAC20-260-310. Disciplinary action; sanctions; publication of records.

A. Each person subject to jurisdiction of this regulation who violates any statute or regulation pertaining to bail enforcement services shall be subject to sanctions imposed by the department regardless of criminal prosecution.

B. The department may impose any of the following sanctions, singly or in combination, when it finds the respondent in violation or in noncompliance of the Code of Virginia or of this regulation:

1. Letter of reprimand or censure;

2. Probation for any period of time;

3. Suspension of license or approval granted, for any period of time;

4. Revocation;

5. Refusal to issue or renew a license or approval;

6. Fine not to exceed $2,500 per violation as long as the respondent was not criminally prosecuted; or

7. Remedial training.

C. The department may conduct hearings and issue cease and desist orders to persons who engage in activities prohibited by this regulation but do not hold a valid license, certification or registration. Any person in violation of a cease and desist order entered by the department shall be subject to all of the remedies provided by law and, in addition, shall be subject to a civil penalty payable to the party injured by the violation.

D. The director (chief administrative officer of the department) may summarily suspend a license under this regulation without a hearing, simultaneously with the filing of a formal complaint and notice for a hearing, if the director finds that the continued operations of the licensee would constitute a life-threatening situation, or has resulted in personal injury or loss to the public or to a consumer, or which may result in imminent harm, personal injury or loss.

E. All proceedings pursuant to this section are matters of public record and shall be preserved. The department may publish a list of the names and addresses of all licensees whose conduct and activities are subject to this regulation and have been sanctioned or denied licensure or approval.

6VAC20-260-320. Fines: administrative and investigative costs.

The department may recover costs of any investigation and adjudication of any violations of the Code of Virginia or regulations that result in a sanction, including fine, probation, suspension, revocation or denial of any license. Such costs shall be in addition to any monetary penalty that may be imposed.

Article 3
Adjudication

6VAC20-260-330. Hearing process.

Following a preliminary investigative process, the department may initiate action to resolve the complaint through an informal fact-finding conference or formal hearing as established in this regulation. Pursuant to the authority conferred in § 9.1-141 C 6 of the Code of Virginia and in accordance with the procedures set forth by the Administrative Process Act and the procedures prescribed in this regulation, the department is empowered to receive, review, investigate and adjudicate complaints concerning the conduct of any person whose activities are regulated by the board. The board will hear and act upon appeals arising from decisions made by the director. In all case decisions, the Criminal Justice Services Board shall be the final agency authority.

6VAC20-260-340. Informal fact-finding conference.

The purpose of an informal fact-finding conference is to resolve allegations through informal consultation and negotiation. Informal fact-finding conferences shall be conducted in accordance with § 2.2-4019 of the Code of Virginia. The respondent, the person against whom the complaint is filed, may appeal the decision of an informal fact-finding conference and request a formal hearing, provided that written notification is given to the department within 30 days of the date the informal fact-finding decision notice was served, or the date it was mailed to the respondent, whichever occurred first. In the event the informal fact-finding decision was served by mail, three days shall be added to that period.

6VAC20-260-350. Formal hearing.

A. Formal hearing proceedings may be initiated in any case in which the basic laws provide expressly for a case decision or in any case to the extent the informal fact-finding conference has not been conducted or an appeal thereto has been timely received. Formal hearings shall be conducted in accordance with § 2.2-4020 of the Code of Virginia. The findings and decision of the director resulting from a formal hearing may be appealed to the board.

B. After a formal hearing pursuant to § 2.2-4020 of the Code of Virginia wherein a sanction is imposed to fine, or to suspend, revoke or deny issuance or renewal of any license or approval, the department may assess the holder thereof the cost of conducting such hearing when the department has final authority to grant such license, registration, certification or approval, unless the department determines that the offense was inadvertent or done in good faith belief that such act did not violate a statute or regulation. The cost shall be limited to (i) the reasonable hourly rate for the hearing officer and (ii) the actual cost of recording the proceedings. This assessment shall be in addition to any fine imposed by sanctions.

6VAC20-260-360. Appeals.

The findings and the decision of the director may be appealed to the board provided that written notification is given to the attention of the Director, Department of Criminal Justice Services, within 30 days following the date notification of the hearing decision was served or the date it was mailed to the respondent, whichever occurred first. In the event the hearing decision is served by mail, three days shall be added to that period. (Rule 2A:2 of Rules of the Virginia Supreme Court.)

6VAC20-260-370. Court review; appeal of final agency order.

A. The final administrative decision may be appealed pursuant to § 2.2-4026 of the Code of Virginia.

B. Notification shall be given to the attention of the Director, Department of Criminal Justice Services, in writing within 30 days of the date notification of the board decision was served or the date it was mailed to the respondent, whichever occurred first. In the event the board decision was served by mail, three days shall be added to that period. (Rule 2A:2 of Rules of the Virginia Supreme Court.)

C. During all judicial proceedings incidental to such disciplinary action, the sanctions imposed by the board shall remain in effect unless the court issues a stay of the order.

Title of Regulation: 9VAC25-260. Water Quality Standards (adding 9VAC25-260-275).

Statutory Authority: § 62.1-44.15 of the Code of Virginia; 33 USC § 1251 et seq.; 40 CFR Part 131.

Public Hearing Information:

January 28, 2009 - 6 p.m. - Northampton High School Auditorium, 16041 Courthouse Road, Eastville, VA

Public Comments: Public comments may be submitted until 5 p.m. on February 20, 2009.

Agency Contact: Elleanore M. Daub, Department of Environmental Quality, 629 East Main Street, P.O. Box 1105, Richmond, VA 23218, telephone (804) 698-4111, FAX (804) 698-4116, or email emdaub@deq.virginia.gov.

Basis: Federal and state legal authority to promulgate this proposed regulation exists in the Clean Water Act at § 303(c), 40 CFR Part 131 and § 62.1-44.15(3a) of the Code of Virginia.

The scope and objective of the Clean Water Act is to restore and maintain the chemical, physical, and biological integrity of the nation's waters. The Clean Water Act at § 303(c) (1) requires that the states hold public hearings for the purpose of reviewing applicable water quality standards and, as appropriate, modifying and adopting standards.

The scope of the federal regulations at 40 CFR Part 131 is to describe the requirements and procedures for developing, reviewing, revising and approving water quality standards by the states as authorized by § 303(c) of the Clean Water Act. 40 CFR Part 131 specifically requires the states to adopt criteria to protect designated uses.

The scope and purpose of the State Water Control Law is to protect and to restore the quality of state waters, to safeguard the clean waters from pollution, to prevent and to reduce pollution and to promote water conservation. The State Water Control Law at § 62.1-44.15(3a) of the Code of Virginia requires the board to establish standards of quality and to modify, amend or cancel any such standards or policies. It also requires the board to hold public hearings from time to time for the purpose of reviewing the water quality standards, and, as appropriate, adopting, modifying or canceling such standards.

The authority to adopt standards as provided by the provisions in the previously referenced citations is mandated, although the specific standards to be adopted or modified are discretionary to the Environmental Protection Agency and the state.

Purpose: This amended regulation is essential to the protection of health, safety or welfare of the citizens of the Commonwealth. Proper water quality standards protect water quality and living resources of Virginia's waters for consumption of shellfish, recreational uses and conservation in general.

The goals of the proposal are to provide additional water quality protection for clams and oysters in waters on the Eastern Shore of Virginia and to ensure that the wastewater management disposal alternative chosen for that area has less of an environmental impact than another alternative. The proposal is intended to reduce condemnations on the Eastern Shore so more waters may be protected for clam and oyster production.

Substance: The substantive provisions to the regulation include a new section, 9VAC25-260-275, that applies to new or expanding individual VPDES permit applications discharging to or affecting waters on the Eastern Shore. This section is initiated when applications for new or expanded VPDES discharges to Eastern Shore waters are not denied pursuant to 9VAC25-260-270 but still result in a shellfish condemnation. These applications must have an analysis that shows if a wastewater management alternative other than a surface water discharge would be feasible, produce less of an environmental impact, and not result in significant social and economic impacts to beneficial uses and to the locality and its citizens.

9VAC25-260-275 also inserts an allowable phased approach to the analysis to help reduce costs to the localities and other applicants. First the feasibility of each alternative can be analyzed. If technically feasible, then the environmental, socio-economic and mitigation opportunities can be analyzed.

9VAC25-260-275 also describes the three scenarios that can result from the analysis and how each scenario proceeds. The first scenario is that the VPDES surface water discharge is the "best" option (the only technically feasible option or the best option for the environment). In that case, the VPDES application proceeds. The second scenario is that an alternative proves to be the best option for the environment but results in adverse socio-economic impact. In that case, the VPDES application proceeds. The third scenario is that an alternative to VPDES is the best option for the environment and causes no significant adverse socio-economic impact. In that case, a good faith effort must be made to pursue the alternative. If the alternative is disapproved by the appropriate regulatory authority, then the VPDES application proceeds.

The Notice of Intended Regulatory Action for this action indicated amendments to 9VAC25-370 were being considered; however, no changes were proposed to the Policy for the Protection of Water Quality in Virginia’s Shellfish Growing Waters at 9VAC25-370.

Issues: The primary advantages to all aspects of the public are to help ensure protection of good water quality and reduce condemnations in Eastern Shore waters to promote clam and oyster growth for commercial and recreational uses. The primary disadvantages to the public, specifically businesses or localities applying for new or expanded discharges, is in the cost or impact of having to do an alternatives analysis if they fall under the requirements of this new section.

There are no advantages to the agency or Commonwealth. The disadvantage is that it will expend additional staff resources to implement this new requirement.

Eastern Shore localities must be aware of these requirements and consider these when planning for increased sewage disposal.

Requirements More Restrictive Than Federal: The requirement for a wastewater disposal management alternative analysis is more restrictive than applicable federal requirements. The rationale for the need was set forth by the Executive Office of the Commonwealth of Virginia to protect these sensitive good quality waters that are threatened by new or expanded wastewater discharges.

Localities Particularly Affected: There are localities particularly affected by this regulation as follows:

Accomack and Northampton counties and the towns of Accomac, Belle Haven, Bloxum, Cape Charles, Cheriton, Chincoteague, Eastville, Exmore, Hallwood, Keller, Melfa, Nassawadox, Onancock, Onley, Painter, Parksley, Saxis, Tangier, and Wachapreague.

Public Participation: In addition to any other comments, the board/agency is seeking comments on the costs and benefits of the proposal, the potential impacts of this regulatory proposal and any impacts of the regulation on farm and forest land preservation. Also, the agency/board is seeking information on impacts on small businesses as defined in § 2.2-4007.1 of the Code of Virginia. Information may include (i) projected reporting, recordkeeping and other administrative costs; (ii) probable effect of the regulation on affected small businesses; and (iii) description of less intrusive or costly alternative methods of achieving the purpose of the regulation.

Anyone wishing to submit written comments may do so at the public hearing or by mail, email or fax to Elleanore Daub, Department of Environmental Quality, P.O. Box 1105, Richmond, VA 23218, telephone (804) 698-4111, FAX (804) 698-4032 or email emdaub@deq.virginia.gov. Comments may also be submitted through the Public Forum feature of the Virginia Regulatory Town Hall website at www.townhall.virginia.gov. Written comments (including email) must include the name and address of the commenter. In order to be considered comments must be received by 5 p.m. on February 20, 2009.

A public hearing will be held on January 28, 2009, at 6 p.m., in the Northampton High School Auditorium, 16041 Courthouse Road, Eastville, VA. Both oral and written comments may be submitted at that time.

A formal hearing will be held at a time and place to be determined if a request for a formal hearing is received by the contact person listed above within 30 days of publication of the notice of public comment period in the Virginia Register of Regulations. The request for formal hearing is to include the information set forth in 9VAC25-230-130 B of the board’s Procedure Rule No. 1.

The Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Amendments to Regulation. The State Water Control Board (board) seeks to amend the Water Quality Standards by designating special "shellfish aquaculture enhancement zones" on the Eastern Shore of Virginia. These zones would be granted additional protection by requiring applicants for permits to discharge into Eastern Shore waters to have completed a valid analysis of whether wastewater management alternatives other than a discharge would be technically feasible, produce less of an environmental impact, and not result in significant social and economic impacts to beneficial uses and to the locality and its citizens. If the analysis demonstrates that an alternative meets these criteria, then that alternative must be pursued for approval prior to the board taking action on the application to discharge into the shellfish aquaculture enhancement zone.

Result of Analysis. The benefits likely exceed the costs for all proposed changes.

Estimated Economic Impact. The goal of this proposed regulation amendment is to improve the sustainability of aquaculture, while at the same time, preventing the shifting of the potential pollution impact from surface water to ground water. This proposal is the result of a Governor’s initiative dating back to early 2006, and results from cooperation among the Secretaries of Natural Resources, Health and Human Resources, and Agriculture and Forestry.

The proposed change would modify criteria that are used to protect Eastern Shore waters that are used or could be used for shellfish aquaculture. If this amendment is promulgated, these waters which include all tidal rivers and creeks on the Eastern Shore (Accomack and Northampton Counties) including the tidal waters within the barrier islands on the eastern seaside of the Eastern Shore (does not include Atlantic Ocean waters) and all tidal rivers and creeks on the western bayside and including the Chesapeake Bay to a point one mile offshore from any point of land on the Eastern Shore would be designated as shellfish aquaculture enhancement zones.

The proposed requirement that discharge applicants seek alternative wastewater management methods if specified conditions are met would apply in situations where proposed discharges would result in shellfish condemnation by the Virginia Department of Health. In these situations, the applicant would need to first complete a valid analysis of whether wastewater management alternatives other than a discharge would be technically feasible. This phase would involve an assessment of the land availability for alternative treatment of surface water discharge and also the related soil composition and type. Such an assessment would cost approximately $30,000 and could vary based on the nature and size of expansion.¹ According to the Department of Environmental Quality applicants for discharge already do this when applying for discharge permits from DEQ. Thus the proposed technical feasibility analysis requirement would not in practice add cost.

If the technical feasibility analysis demonstrates that any of the identified alternatives are technically feasible, then the applicant is required to have an assessment of the environmental and socio-economic effects of adopting the select alternative technology conducted. Environmental analysis would include a review of groundwater impacts, swimming or recreational impacts and shellfish condemnations. Socio-economic impact analysis of any technically feasible alternative would include an analysis of the affordability of the land, technology, positive and negative tax revenue impacts to the locality, eco-tourism, recreation and aesthetics. Such an analysis that includes an accounting assessment of the technology options and mitigation measures and socio-economic welfare assessment for a typical proposed expansion of a locality’s wastewater discharge would cost the applicant approximately $35,000 to $55,000.²

If the alternatives analysis demonstrates that the proposed new or expanded discharge into the shellfish aquaculture enhancement zone is the only technically feasible alternative or produces the least environmental impact of all the technically feasible alternatives, then the permit application for discharge into the shellfish aquaculture enhancement zone is processed in accordance with the Virginia Pollutant Discharge Elimination System (VPDES) Permit Regulation (9VAC25-31). If the analysis demonstrates that a technically feasible alternative produces less of an environmental impact than that associated with the proposed new or expanded discharge but results in significant adverse social and economic impacts to beneficial uses and to the locality and its citizens, then the permit application for discharge into the shellfish aquaculture enhancement zone is processed in accordance with the VPDES Permit Regulation. If the analysis demonstrates that a technically feasible alternative produces less of an environmental impact than that associated with the proposed new or expanded discharge and does not result in significant adverse social and economic impacts to beneficial uses and to the locality and its citizens, then processing of the VPDES application is suspended while the applicant makes a good faith effort to obtain approval from the appropriate regulatory authorities for the alternative. Processing of the application shall be resumed only if the alternative form of wastewater management is disapproved by the appropriate regulatory authorities.

To the extent that alternative wastewater management methods are found that are technically feasible, less environmentally harmful, and do not cause significant adverse social and economic impacts to beneficial uses and to the locality and its citizens, the requirement that these alternative wastewater management methods are pursued when specified conditions are met may produce significant benefit for the aquaculture industry, consumers of clams and oysters, and the general public who seek recreation in the shellfish aquaculture enhancement zone. Some firms who supply environmental, social and economic impact analysis may benefit as well.

Some local governments, private builders and developers will encounter the additional cost of having an assessment of the environmental and socio-economic effects of adopting the select alternative wastewater management method. If alternative wastewater management methods are found that are technically feasible, less environmentally harmful, and do not cause significant adverse social and economic impacts to beneficial uses and to the locality and its citizens are found in practice, then the benefits to the environment, the aquaculture industry, consumers of clams and oysters, and the general public who seek recreation in the shellfish aquaculture enhancement zone will likely outweigh the cost to discharge applicants of the assessment of the environmental and socio-economic effects of adopting the select alternative wastewater management method.

Businesses and Entities Affected. The proposed amendment affects any public or private entity that proposes new construction or expansion of existing facilities to discharge sanitary waste into estuarine waters in Accomack or Northampton Counties, or close enough to such waters as to create the potential for bacterial contamination if there were a treatment plant failure. The proposal also potentially affects environmental engineering firms, economic consulting firms, aquaculture firms, and the general public who seek recreation in the shellfish aquaculture enhancement zone.

Localities Particularly Affected. The proposed amendments particularly affect Accomack and Northampton counties and the towns of Accomac, Belle Haven, Bloxum, Cape Charles, Cheriton, Chincoteague, Eastville, Exmore, Hallwood, Keller, Melfa, Nassawadox, Onancock, Onley, Painter, Parksley, Saxis, Tangier, and Wachapreague.

Projected Impact on Employment. Aquaculture firms will likely benefit by the proposed requirements in that fewer portions of tidal waters that have potential for aquaculture may be rendered unsuitable for aquaculture. In the long run this may increase employment in that industry. Demand for services from environmental engineering firms and economic consulting firms will likely moderately increase due to the proposed requirement for analysis of environmental, social and economic impacts of technically feasible alternatives. Consequently there may be a small increase in employment for some of these firms.

Effects on the Use and Value of Private Property. Aquaculture firms will likely benefit by the proposed requirements in that fewer portions of tidal waters that have potential for aquaculture may be rendered unsuitable for aquaculture. In the long run this may increase the growth and collection of edible clams and oysters, increasing the size and value of the aquaculture industry in Virginia. Demand for services from environmental engineering firms and economic consulting firms will likely moderately increase due to the proposed requirement for analysis of environmental, social and economic impacts of technically feasible alternatives. Consequently there may be a small increase in the value of some environmental engineering firms and economic consulting firms.

Small Businesses: Costs and Other Effects. Small aquaculture firms will likely benefit by the proposed requirements in that fewer portions of tidal waters that have potential for aquaculture may be rendered unsuitable for aquaculture. Some small environmental engineering firms and economic consulting firms may benefit by having greater demand for their services due to the proposed requirement for analysis of environmental, social and economic impacts of technically feasible alternatives.

Some small builders and developers considering doing business on the Eastern Shore will encounter greater costs if the technical feasibility analysis demonstrates that any of the identified alternatives are technically feasible.

Small Businesses: Alternative Method that Minimizes Adverse Impact. The proposed requirements will increase costs for small builders and developers doing business on the Eastern Shore; but there are no obvious alternative methods that would reduce the adverse impact and still produce the desired policy of greater protection of the shellfish aquaculture enhancement zones.

Real Estate Development Costs. The proposed requirements will in some incidences increase real estate development costs on the Eastern Shore. When the technical feasibility analysis demonstrates that any of the identified alternatives are technically feasible, then the discharge applicant is required to have an assessment of the environmental and socio-economic effects of adopting the select alternative technology conducted under the proposed regulations. Such analysis would cost the applicant approximately $35,000 to $55,000.³

Legal Mandate. The Department of Planning and Budget (DPB) has analyzed the economic impact of this proposed regulation in accordance with § 2.2-4007.04 of the Administrative Process Act and Executive Order Number 36 (06). Section 2.2-4007.04 requires that such economic impact analyses include, but need not be limited to, the projected number of businesses or other entities to whom the regulation would apply, the identity of any localities and types of businesses or other entities particularly affected, the projected number of persons and employment positions to be affected, the projected costs to affected businesses or entities to implement or comply with the regulation, and the impact on the use and value of private property. Further, if the proposed regulation has adverse effect on small businesses, § 2.2-4007.04 requires that such economic impact analyses include (i) an identification and estimate of the number of small businesses subject to the regulation; (ii) the projected reporting, recordkeeping, and other administrative costs required for small businesses to comply with the regulation, including the type of professional skills necessary for preparing required reports and other documents; (iii) a statement of the probable effect of the regulation on affected small businesses; and (iv) a description of any less intrusive or less costly alternative methods of achieving the purpose of the regulation. The analysis presented above represents DPB’s best estimate of these economic impacts.

__________________________

¹ Cost estimate from Department of Environmental Quality

² Ibid

³ Cost estimate from Department of Environmental Quality

Agency's Response to the Department of Planning and Budget's Economic Impact Analysis: The department has reviewed the economic impact analysis prepared by the Department of Planning and Budget and has no comment.

Summary:

The proposed amendments add a new section, 9VAC25-260-275, that is initiated when applications for new or expanded VPDES discharges to Eastern Shore waters are not denied pursuant to 9VAC25-260-270. If these discharges result in shellfish condemnations, then the applicant must analyze whether wastewater management alternatives other than a discharge would be feasible, produce less of an environmental impact, and not result in significant social and economic impacts to beneficial uses and to the locality and its citizens. If the analysis demonstrates that an alternative meets these criteria, then that alternative must be pursued for approval prior to the board taking action on the discharge alternative.

9VAC25-260-275. Protection of Eastern Shore tidal waters for clams and oysters.

A. This section applies to applications for individual Virginia Pollutant Discharge Elimination System (VPDES) permits authorizing new or expanded discharges to or otherwise affecting Eastern Shore tidal waters, which include all tidal rivers and creeks on the Eastern Shore (Accomack and Northampton counties) including the tidal waters within the barrier islands on the eastern seaside of the Eastern Shore (does not include Atlantic Ocean waters) and all tidal rivers and creeks on the western bayside and including the Chesapeake Bay to a point one mile offshore from any point of land on the Eastern Shore.

B. When such application proposes a new or expanded discharge that would not be denied pursuant to 9VAC25-260-270 but would result in shellfish water condemnation, then the application shall be amended to contain an analysis of wastewater management alternatives to the proposed discharge. An application shall be deemed incomplete until this analysis is provided to the department.

C. For purposes of this part, condemnation shall mean a reclassification of shellfish waters by the state Department of Health to prohibited or restricted (as defined by the U.S. Food and Drug Administration, National Shellfish Sanitation Program, Guide for the Control of Molluscan Shellfish, 2005, Section II, Model Ordinance, Definitions, and Chapter 4, Classification of Shellfish Growing Areas) thereby signifying that shellfish from such waters are unfit for market.

D. The alternatives analysis shall first identify and describe the technical feasibility of each wastewater management alternative to the proposed new or expanded discharge. If the analysis demonstrates that any of the identified alternatives are technically feasible, then the analysis shall further describe the environmental, social and economic impacts and opportunities to mitigate any adverse impacts for those alternatives.

E. If the alternatives analysis demonstrates that the proposed new or expanded discharge is the only technically feasible alternative or produces the least environmental impact of all the technically feasible alternatives, the application will be processed in accordance with 9VAC25-31 (VPDES Permit Regulation). If the analysis demonstrates that a technically feasible alternative produces less of an environmental impact than that associated with the proposed new or expanded discharge but results in significant adverse social and economic impacts to beneficial uses and to the locality and its citizens, the application shall be processed in accordance with 9VAC25-31. If the analysis demonstrates that a technically feasible alternative produces less of an environmental impact than that associated with the proposed new or expanded discharge and does not result in significant adverse social and economic impacts to beneficial uses and to the locality and its citizens, then processing of the VPDES application shall be suspended while the applicant makes a good faith effort to obtain approval from the appropriate regulatory authorities for the alternative. Processing of the application shall be resumed only if the alternative form of wastewater management is disapproved by the appropriate regulatory authorities.

DOCUMENTS INCORPORATED BY REFERENCE (9VAC25-260)

Chesapeake Bay Program Analytical Segmentation
Scheme -- Revisions, Decisions and Rationales 1983-2003, EPA CBP/TRS 268/04, October 2004.

Ambient Water Quality Criteria for Dissolved Oxygen, Water Clarity and Chlorophyll a for the Chesapeake Bay and Its Tidal Tributaries, EPA 903-R-03-002, April 2003 and 2004 Addendum, October 2004.

Technical Support Document for Identification of Chesapeake Bay Designated Uses and Attainability, EPA 903-R-03-004, October 2003 and 2004 Addendum, October 2004.

Guide for the Control of Molluscan Shellfish, 2005 (Section II. Model Ordinance and Chapter 4. Classification of Shellfish Growing Areas), U.S. Food and Drug Administration, National Shellfish Sanitation Program.

Titles of Regulations: 12VAC30-50. Amount, Duration, and Scope of Medical and Remedial Care Services (amending 12VAC30-50-320; adding 12VAC30-50-330 through 12VAC30-50-360).

12VAC30-120. Waivered Services (repealing 12VAC30-120-61 through 12VAC30-120-68).

Statutory Authority: § 32.1-325 of the Code of Virginia; 42 USC § 1396.

Public Hearing Information: No public hearings are scheduled.

Public Comments: Public comments may be submitted until 5 p.m. on January 21, 2009.

Effective Date: February 5, 2009.

Agency Contact: Deborah Pegram, Long-Term Care Services Division, Department of Medical Assistance Services, 600 East Broad Street, Suite 1300, Richmond, VA 23219, telephone (804) 371-2912, FAX (804) 786-1680, or email deborah.pegram@dmas.virginia.gov.

Basis: Section 32.1-325 of the Code of Virginia grants to the Board of Medical Assistance Services the authority to administer and amend the Plan for Medical Assistance. Section 32.1-324 of the Code of Virginia authorizes the Director of DMAS to administer and amend the Plan for Medical Assistance according to the board's requirements. The Medicaid authority as established by § 1902 (a) of the Social Security Act (42 USC § 1396a) provides governing authority for payments for services.

Purpose: The amended regulation is required in order to meet CMS’ requirements to have the PACE program categorized as a State Plan optional service and not a waiver service. These regulations must be promulgated to accomplish this action.

The purpose of PACE is to provide a community-based alternative to nursing facility care that integrates primary and long-term care services within Medicaid, but excludes Medicare financing and services. Sentara Senior Community Care, a pre-PACE provider in the Tidewater area, served 122 enrolled participants in FY 06 at a cost of $3.4 million for an average of approximately $27,655 per person. PACE combines Medicaid and Medicare funding to provide all medical, social, and long-term care services through an adult day health care center (ADHC). The pre-PACE and PACE programs allows elders to remain in familiar surroundings; maintain self-sufficiency; and preserve the highest level of physical, social, and cognitive function and independence. A nursing facility preadmission screening team must authorize PACE services. In order to continue the PACE program DMAS must move the PACE regulations out of the waiver services section of the Virginia Administrative Code and into the State Plan services section of the Administrative Code.

Rationale for Using Fast-Track Process: The fast-track regulatory process is required in order to bring the PACE regulation into compliance with DMAS' approved State Plan amendment. Except as noted for 12VAC30-120-67 in the "Substance" statement below, no language is being substantively amended; technical and grammatical changes are being recommended in four places. The primary intent of the proposed action is to move the PACE regulation from the waiver section of DMAS regulations to the State Plan section.

Substance: 12VAC30-120-67, PACE catastrophic coverage limitation, is being repealed. The remaining PACE regulations are being moved from the waiver section to the State Plan section.

In addition, four technical changes are being recommended:

1. In the "Definitions" section (12VAC30-50-330), "all" is added to the "capitation rate" definition to clarify that all necessary services are provided to PACE participants within the negotiated monthly per capita amount. This is the original intent and is clearly stated in the Request for Proposals.

2. In the "Definitions" section, "by" is added to the definition for the "PACE plan feasibility study" to correct a grammatical error.

3. Also in the "Definitions" section, "provider" is defined. The definition is taken from other existing waiver regulations and was inadvertently omitted.

4. In response to a request by the Centers for Medicare and Medicaid (CMS), in the "General PACE Plan Requirements" section at 12VAC30-50-335, "prior to the beginning of employment" is added to the existing requirement for the criminal record check process for providers and employees. This clarifies the intent of the existing language and brings the regulation into compliance with CMS requirements.

Issues: The movement of this regulation is to maintain department efforts to improve the infrastructure for community-based long-term support services by making the PACE regulation a State Plan option, allowing the state additional flexibility within the program. The PACE program creates a system of long-term services and supports that enables the elderly to remain in the community rather than in a more costly and less restrictive institutional setting.

This proposal supports Virginia’s implementation of the Olmstead decision and complements the efforts of the recently awarded Systems Transformation Grant and Money Follows the Person Demonstration that both intend to improve the infrastructure for community-based long-term support services.

There are no disadvantages to the public or the Commonwealth.

This proposed regulatory action will have a positive impact on families in allowing individuals facing institutional placement an additional home and community-based option.

The Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Amendments to Regulation. The proposed changes will move the PACE regulations from the waiver section of Medicaid regulations to the State Plan for Medical Assistance Services section.

Result of Analysis. The benefits likely exceed the costs for all proposed changes.

Estimated Economic Impact. Program of All-Inclusive Care for the Elderly (PACE) provides community based services that are alternative to nursing facility care to the recipients through an adult day health care center.

The PACE program started as a waiver program and its rules were placed in the waiver section of Medicaid regulations (12VAC30-120). On January 1, 2007, the Centers for Medicare and Medicaid (CMS) allowed Virginia to offer PACE program as an optional State Plan service rather than a waiver service. Consequently, the proposed changes will move the PACE rules into the section of Medicaid regulations where State Option service regulations are housed (12VAC30-50).

A waiver service, unlike a state plan service, waives either one of the three primary federal limitations: statewideness; comparability of services, and free choice of providers. So, making a waiver service a state plan service would normally mean a change in statewideness, comparability of services, or free choice of providers. However, in this particular case, CMS granted exemptions so that there was no change in statewideness, comparability of services, and free choice of providers. In short, the proposed movement of the regulations will produce no change in practice. Thus, no significant economic effect is expected from the proposed regulations other than providing a small benefit in terms of the consistency in housing all of the state option services under the same section.

Businesses and Entities Affected. The proposed regulations apply to PACE providers and recipients. In 2006, there were one provider and 122 enrollees.

Localities Particularly Affected. The regulations apply throughout the Commonwealth, but, the only provider was located in Tidewater area.

Projected Impact on Employment. No significant effect on employment is expected.

Effects on the Use and Value of Private Property. No significant effect on the use and value of private property is expected.

Small Businesses: Costs and Other Effects. Proposed regulations have no costs or other effects on small businesses.

Small Businesses: Alternative Method that Minimizes Adverse Impact. Proposed regulations have no adverse impact on small businesses.

Real Estate Development Costs. Proposed regulations have no real estate development costs.

Legal Mandate. The Department of Planning and Budget (DPB) has analyzed the economic impact of this proposed regulation in accordance with § 2.2-4007.04 of the Administrative Process Act and Executive Order Number 36 (06). Section 2.2-4007.04 requires that such economic impact analyses include, but need not be limited to, the projected number of businesses or other entities to whom the regulation would apply, the identity of any localities and types of businesses or other entities particularly affected, the projected number of persons and employment positions to be affected, the projected costs to affected businesses or entities to implement or comply with the regulation, and the impact on the use and value of private property. Further, if the proposed regulation has adverse effect on small businesses, § 2.2-4007.04 requires that such economic impact analyses include (i) an identification and estimate of the number of small businesses subject to the regulation; (ii) the projected reporting, recordkeeping, and other administrative costs required for small businesses to comply with the regulation, including the type of professional skills necessary for preparing required reports and other documents; (iii) a statement of the probable effect of the regulation on affected small businesses; and (iv) a description of any less intrusive or less costly alternative methods of achieving the purpose of the regulation. The analysis presented above represents DPB’s best estimate of these economic impacts.

Agency's Response to the Department of Planning and Budget's Economic Impact Analysis: The agency concurs with the economic impact analysis prepared by the Department of Planning and Budget regarding the regulations concerning Program of All-Inclusive Care for the Elderly (PACE) as State Plan Service (12VAC30-50-320, 12VAC30-50-330, 12VAC30-50-335, 12VAC30-50-340, 12VAC30-50-345, 12VAC30-50-350, 12VAC30-50-355, 12VAC30-50-360, and 12VAC30-120-61, 12VAC30-120-62, 12VAC30-120-63, 12VAC30-120-64, 12VAC30-120-65, 12VAC30-120-66, 12VAC30-120-67, and 12VAC30-120-68).

Summary

The amendments (i) move the Program of All-Inclusive Care for the Elderly (PACE) regulations from the waiver services section of the Department of Medical Assistance Services' (DMAS') regulations to the State Plan for Medical Assistance Services section, (ii) repeal 12VAC30-120-67 (PACE catastrophic coverage limitation), (iii) make technical changes to the definitions section, and (iv) require that the existing criminal record check process for providers and employees by conducted prior to the beginning of employment.

12VAC30-50-320. Program of All-Inclusive Care for the Elderly (PACE).

The Commonwealth of Virginia has not entered into a valid program agreement or agreements with a PACE provider or providers and the Secretary of the U.S. Department of Health and Human Services.

12VAC30-50-330. PACE definitions.

For purposes of this part and all contracts establishing the Program of All-Inclusive Care for the Elderly (PACE) programs as defined in 42 CFR Part 460, the following definitions shall apply:

"Adult day health care center" or "ADHC" means a DMAS-enrolled provider that offers a community-based day program providing a variety of health, therapeutic, and social services designed to meet the specialized needs of those elderly and disabled individuals at risk of placement in a nursing facility. The ADHC must be licensed by the Virginia Department of Social Services as an adult day care center (ADC) as defined in 22VAC40-60-10.

"Applicant" means an individual seeking enrollment in a PACE plan.

"Capitation rate" means the negotiated Medicaid monthly per capita amount paid to a PACE provider for all services provided to enrollees.

"Catchment area" means the designated service area for a PACE plan.

"Centers for Medicare and Medicaid Services" or "CMS" means the unit of the U.S. Department of Health and Human Services that administers the Medicare and Medicaid programs.

"CFR" means the Code of Federal Regulations.

"DMAS" means the Department of Medical Assistance Services.

"DSS" means the Department of Social Services.

"Direct marketing" means either (i) conducting directly or indirectly door-to-door, telephonic or other "cold call" marketing of services at residences and provider sites; (ii) mailing directly; (iii) paying "finders' fees;" (iv) offering financial incentives, rewards, gifts or special opportunities to eligible individuals or family/caregivers as inducements to use the providers' services; (v) continuous, periodic marketing activities to the same prospective individual or family/caregiver for example, monthly, quarterly, or annual giveaways as inducements to use the providers' services; or (vi) engaging in marketing activities that offer potential customers rebates or discounts in conjunction with the use of the providers' services or other benefits as a means of influencing the individual's or family/caregiver's use of the providers' services.

"Enrollee" means a Medicaid-eligible individual meeting PACE enrollment criteria and receiving services from a PACE plan.

"Full disclosure" means fully informing all PACE enrollees at the time of enrollment that, pursuant to § 32.1-330.3 of the Code of Virginia, PACE plan enrollment can only be guaranteed for a 30-day period.

"Imminent risk of nursing facility placement" means that an individual will require nursing facility care within 30 days if a community-based alternative care program, such as a PACE plan, is not available.

"PACE" means a Program of All-Inclusive Care for the Elderly. PACE services are designed to enhance the quality of life and autonomy for frail, older adults; maximize dignity of, and respect for, older adults; enable frail, older adults to live in the community as long as medically and socially feasible; and preserve and support the older adult's family unit.

"PACE plan" means a comprehensive acute and long-term care prepaid health plan, pursuant to § 32.1-330.3 of the Code of Virginia and as defined in 42 CFR 460.6, operating on a capitated payment basis through which the PACE provider assumes full financial risk. PACE plans operate under both Medicare and Medicaid capitation.

"PACE plan contract" means a contract, pursuant to § 32.1-330.3 of the Code of Virginia, under which an entity assumes full financial risk for operation of a comprehensive acute and long-term care prepaid health plan with capitated payments for services provided to Medicaid enrollees being made by DMAS. The parties to a PACE plan contract are the entities operating the PACE plan, DMAS and CMS.

"PACE plan feasibility study" means a study performed by a research entity approved by DMAS to determine a potential PACE plan provider's ability and resources, or lack thereof, to effectively operate a PACE plan. All study costs are the responsibility of the potential PACE provider.

"PACE protocol" means the protocol for the Program of All-Inclusive Care for the Elderly, as published by On Lok, Inc., as of April 14, 1995, or any successor protocol that may be agreed upon by the federal Secretary of Health and Human Services and On Lok, Inc.

"PACE site" means the location, which includes a primary care center, where the PACE provider both operates the PACE plan's adult day health care center and coordinates the provision of core PACE services, including the provision of primary care.

"PACE provider" means the entity contracting with the Department of Medical Assistance Services to operate a PACE plan.

"Plan of care" means the written plan developed by the provider related solely to the specific services required by the individual to ensure optimal health and safety while receiving services from the provider.

"Preadmission screening" means the process to: (i) evaluate the functional, nursing, and social supports of individuals referred for preadmission screenings; (ii) assist individuals in determining what specific services individuals need; (iii) evaluate whether a service or a combination of existing community-based services are available to meet the individual's needs; (iv) refer individuals to the appropriate provider for Medicaid-funded nursing facility or home and community-based care for those individuals who meet nursing facility level of care.

"Preadmission screening team" means the entity contracted with DMAS that is responsible for performing preadmission screening pursuant to § 32.1-330 of the Code of Virginia.

"Primary care provider" or "PCP" means the individual responsible for the coordination of medical care provided to an enrollee under a PACE plan.

"Provider" means the individual or other entity registered, licensed, or certified, as appropriate, and enrolled by DMAS to render services to Medicaid recipients eligible for services.

"State Plan for Medical Assistance" or "the Plan" means the Commonwealth's legal document approved by CMS identifying the covered groups, covered services and their limitations, and provider reimbursement methodologies as provided for under Title XIX of the Social Security Act.

"Virginia Uniform Assessment Instrument" or "UAI" means the standardized, multidimensional questionnaire that assesses an individual's social, physical and mental health, and functional abilities.

12VAC30-50-335. General PACE plan requirements.

A. DMAS, the state agency responsible for administering Virginia's Medicaid program, shall only enter into PACE plan contracts with approved PACE plan providers. The PACE provider must have an agreement with CMS and DMAS for the operation of a PACE program. The agreement must include:

1. Designation of the program's service area;

2. The program's commitment to meet all applicable federal, state, and local requirements;

3. The effective date and term of the agreement;

4. The description of the organizational structure;

5. Participant bill of rights;

6. Description of grievance and appeals processes;

7. Policies on eligibility, enrollment, and disenrollment;

8. Description of services available;

9. Description of quality management and performance improvement program;

10. A statement of levels of performance required on standard quality measures;

11. CMS and DMAS data requirements;

12. The Medicaid capitation rate and the methodology used to calculate the Medicare capitation rate;

13. Procedures for program termination; and

14. A statement to hold harmless CMS, the state, and PACE participants if the PACE organization does not pay for services performed by the provider in accordance with the contract.

B. A PACE plan feasibility study shall be performed before DMAS enters into any PACE plan contract. DMAS shall contract only with those entities it determines to have the ability and resources to effectively operate a PACE plan. A feasibility plan shall only be submitted in response to a Request for Applications published by DMAS.

C. PACE plans shall offer a voluntary comprehensive alternative to enrollees who would otherwise be placed in a nursing facility. PACE plan services shall be comprehensive and offered as an alternative to nursing facility admission.

D. All Medicaid-enrolled PACE participants shall continue to meet the nonfinancial and financial Medicaid eligibility criteria established by federal law and these regulations. This requirement shall not apply to Medicare only or private pay PACE participants.

E. Each PACE provider shall operate a PACE site that is in continuous compliance with all state licensure requirements for that site.

F. Each PACE provider shall offer core PACE services as described in 12VAC30-50-345 B through a coordination site that is licensed as an ADHC by DSS.

G. Each PACE provider shall ensure that services are provided by health care providers and institutions that are in continuous compliance with state licensure and certification requirements.

H. Each PACE plan shall meet the requirements of §§ 32.1-330.2 and 32.1-330.3 of the Code of Virginia and 42 CFR Part 460.

I. All PACE providers must meet the general requirements and conditions for participation pursuant to the required contracts by DMAS and CMS. All providers must sign the appropriate participation agreement. All providers must adhere to the conditions of participation outlined in the participation agreement and application to provide PACE services, DMAS regulations, policies and procedures, and CMS requirements pursuant to 42 CFR Part 460.

J. Requests for participation as a PACE provider will be screened by DMAS to determine whether the provider applicant meets these basic requirements for participation and demonstrates the abilities to perform, at a minimum, the following activities:

1. Immediately notify DMAS, in writing, of any change in the information that the provider previously submitted to DMAS.

2. Assure freedom of choice to individuals in seeking services from any institution, pharmacy, practitioner, or other provider qualified to perform the service or services required and participating in the Medicaid Program at the time the service or services are performed.

3. Assure the individual's freedom to refuse medical care, treatment, and services.

4. Accept referrals for services only when qualified staff is available to initiate and perform such services on an ongoing basis.

5. Provide services and supplies to individuals in full compliance with Title VI of the Civil Rights Act of 1964, as amended (42 USC § 2000 et seq.), which prohibits discrimination on the grounds of race, color, religion, sexual orientation or national origin; the Virginians with Disabilities Act (§ 51.5-1 et seq. of the Code of Virginia); § 504 of the Rehabilitation Act of 1973, as amended (29 USC § 794), which prohibits discrimination on the basis of a disability; and the Americans with Disabilities Act of 1990, as amended (42 USC § 12101 et seq.), which provides comprehensive civil rights protections to individuals with disabilities in the areas of employment, public accommodations, state and local government services, and telecommunications.

6. Provide services and supplies to individuals of the same quality and in the same mode of delivery as is provided to the general public.

7. Use only DMAS-designated forms for service documentation. The provider must not alter the DMAS forms in any manner unless approval from DMAS is obtained prior to using the altered forms.

8. Not perform any type of direct marketing activities to Medicaid individuals.

9. Maintain and retain business and professional records sufficient to document fully and accurately the nature, scope, and details of the services provided.

a. In general, such records shall be retained for at least six years from the last date of service or as provided by applicable federal and state laws, whichever period is longer. However, if an audit is initiated within the required retention period, the records shall be retained until the audit is completed and every exception resolved. Records of minors shall be kept for at least six years after such minor has reached the age of 18 years. However, records for Medicare Part D shall be maintained for 10 years in accordance with 42 CFR 423.505(d).

b. Policies regarding retention of records shall apply even if the provider discontinues operation. DMAS shall be notified in writing of the storage location and procedures for obtaining records for review. The location, agent, or trustee shall be within the Commonwealth.

10. Furnish information on request and in the form requested to DMAS, the Attorney General of Virginia or his authorized representatives, federal personnel, and the state Medicaid Fraud Control Unit. The Commonwealth's right of access to provider agencies and records shall survive any termination of the provider agreement.

11. Disclose, as requested by DMAS, all financial, beneficial, ownership, equity, surety, or other interests in any and all firms, corporations, partnerships, associations, business enterprises, joint ventures, agencies, institutions, or other legal entities providing any form of health care services to individuals of Medicaid.

12. Pursuant to 42 CFR 431.300 et seq., 12VAC30-20-90, and any other applicable federal or state law, all providers shall hold confidential and use for authorized DMAS purposes only all medical assistance information regarding individuals served. A provider shall disclose information in his possession only when the information is used in conjunction with a claim for health benefits, or the data are necessary for the functioning of DMAS in conjunction with the cited laws.

13. CMS and DMAS shall be notified in writing of any change in the organizational structure of a PACE provider organization at least 14 calendar days before the change takes effect.

14. In addition to compliance with the general conditions and requirements, all providers enrolled by DMAS shall adhere to the conditions of participation outlined in their individual provider participation agreements and in the applicable DMAS provider manual. DMAS shall conduct ongoing monitoring of compliance with provider participation standards and DMAS policies. A provider's noncompliance with DMAS policies and procedures may result in a retraction of Medicaid payment or termination of the provider agreement, or both.

15. Minimum qualifications of staff.

a. All employees must have a satisfactory work record as evidenced by references from prior job experience, including no evidence of abuse, neglect, or exploitation of vulnerable adults and children. Prior to the beginning of employment, a criminal record check shall be conducted for the provider and each employee and made available for review by DMAS staff. Providers are responsible for complying with the Code of Virginia and state regulations regarding criminal record checks and barrier crimes as they pertain to the licensure and program requirements of their employees' particular practice areas.

b. Staff must meet any certifications, licensure, registration, etc., as required by applicable federal and state law. Staff qualifications must be documented and maintained for review by DMAS or its authorized contractors.

16. At the time of their admission to services, all providers participating in the Medicare and Medicaid programs must provide adult individuals with written information regarding each individual's right to make medical care decisions, including the right to accept or refuse medical treatment and the right to formulate advance directives.

K. Provider's conviction of a felony. The Medicaid provider agreement shall terminate upon conviction of the provider of a felony pursuant to § 32.1-325 of the Code of Virginia. A provider convicted of a felony in Virginia or in any other of the 50 states, the District of Columbia, or the U.S. territories must, within 30 days, notify the Virginia Medicaid Program of this conviction and relinquish the provider agreement. In addition, termination of a provider participation agreement will occur as may be required for federal financial participation.

L. Ongoing quality management review. DMAS shall be responsible for assuring continued adherence to provider participation standards. DMAS shall conduct ongoing monitoring of compliance with provider participation standards and DMAS policies and periodically recertify each provider for participation agreement renewal with DMAS to provide PACE services.

M. Reporting suspected abuse or neglect. Pursuant to §§ 63.2-1508 through 63.2-1513 and 63.2-1606 of the Code of Virginia, if a participating provider entity suspects that a child or vulnerable adult is being abused, neglected, or exploited, the party having knowledge or suspicion of the abuse, neglect, or exploitation shall report this immediately to DSS and to DMAS. In addition, as mandated reporters for vulnerable adults, participating providers must inform their staff that they are mandated reporters and provide education regarding how to report suspected adult abuse, neglect, or exploitation pursuant to § 63.2-1606 F of the Code of Virginia.

N. Documentation requirements. The provider must maintain all records of each individual receiving services. All documentation in the individual's record must be completely signed and dated with name of the person providing the service, title, and complete date with month, day, and year. This documentation shall contain, up to and including the last date of service, all of the following:

1. The most recently updated Virginia Uniform Assessment Instrument (UAI), all other assessments and reassessments, plans of care, supporting documentation, and documentation of any inpatient hospital admissions;

2. All correspondence and related communication with the individual and, as appropriate, consultants, providers, DMAS, DSS, or other related parties; and

3. Documentation of the date services were rendered and the amount and type of services rendered.

12VAC30-50-340. Criteria for PACE enrollment.

A. Eligibility shall be determined in the manner provided for in the State Plan and these regulations. To the extent these regulations differ from other provisions of the State Plan for purposes of PACE eligibility and enrollment, these regulations shall control.

B. Individuals meeting the following nonfinancial criteria shall be eligible to enroll in PACE plans approved by DMAS:

1. Individuals who are age 55 or older;

2. Individuals who require nursing facility level of care and are at imminent risk of nursing facility placement as determined by a nursing home preadmission screening team through a nursing home preadmission screening performed using the UAI;

3. Individuals for whom PACE plan services are medically appropriate and necessary because without the services the individual is at imminent risk of nursing facility placement;

4. Individuals who reside in a PACE plan catchment area;

5. Individuals who meet other criteria specified in a PACE plan contract;

6. Individuals who participate in the Medicaid or Medicare programs as specified in § 32.1-330.3 E of the Code of Virginia; and

7. Individuals who voluntarily enroll in a PACE plan and agree to the terms and conditions of enrollment.

C. To the extent permitted by federal law and regulation, individuals meeting the following financial criteria shall be eligible to enroll in PACE plans approved by DMAS:

1. Individuals whose income is determined by DMAS under the provision of the State Plan to be equal to or less than 300% of the current Supplemental Security Income payment standard for one person; and

2. Individuals whose resources are determined by DMAS under the provisions of the State Plan to be equal to or less than the current resource allowance established in the State Plan.

D. For purposes of a financial eligibility determination, applicants shall be considered as if they are institutionalized for the purpose of applying institutional deeming rules.

E. DMAS shall not pay for services provided to an applicant by a PACE contractor if such services are provided prior to the PACE plan authorization date set by the nursing home preadmission screening team.

12VAC30-50-345. PACE enrollee rights.

A. PACE providers shall ensure that enrollees are fully informed of their rights and responsibilities in accordance with all state and federal requirements. These rights and responsibilities shall include, but not be limited to:

1. The right to be fully informed at the time of enrollment that PACE plan enrollment can only be guaranteed for a 30-day period pursuant to § 32.1-330.3 F of the Code of Virginia;

2. The right to receive PACE plan services directly from the provider or under arrangements made by the provider; and

3. The right to be fully informed in writing of any action to be taken affecting the receipt of PACE plan services.

B. PACE providers shall notify enrollees of the full scope of services available under a PACE plan, as described in 42 CFR 460.92. The services shall include, but not be limited to:

1. Medical services, including the services of a PCP and other specialists;

2. Transportation services;

3. Outpatient rehabilitation services, including physical, occupational and speech therapy services;

4. Hospital (acute care) services;

5. Nursing facility (long-term care) services;

6. Prescription drugs;

7. Home health services;

8. Laboratory services;

9. Radiology services;

10. Ambulatory surgery services;

11. Respite care services;

12. Personal care services;

13. Dental services;

14. Adult day health care services, to include social work services;

15. Interdisciplinary case management services;

16. Outpatient mental health and mental retardation services;

17. Outpatient psychological services;

18. Prosthetics; and

19. Durable medical equipment and other medical supplies.

C. Services available under a PACE plan shall not include any of the following:

1. Any service not authorized by the interdisciplinary team unless such service is an emergency service (i.e., a service provided in the event of a situation of a serious or urgent nature that endangers the health, safety, or welfare of an individual and demands immediate action);

2. In an inpatient facility, private room and private duty nursing services unless medically necessary, and nonmedical items for personal convenience such as telephones charges and radio or television rental, unless specifically authorized by the interdisciplinary team as part of the participant's plan of care;

3. Cosmetic surgery except as described in agency guidance documents;

4. Any experimental medical, surgical or other health procedure; and

5. Any other service excluded under 42 CFR 460.96.

D. PACE providers shall ensure that PACE plan services are at least as accessible to enrollees as they are to other Medicaid-eligible individuals residing in the applicable catchment area.

E. PACE providers shall provide enrollees with access to services authorized by the interdisciplinary team 24 hours per day every day of the year.

F. PACE providers shall provide enrollees with all information necessary to facilitate easy access to services.

G. PACE providers shall provide enrollees with identification documents approved by DMAS. PACE plan identification documents shall give notice to others of enrollees' coverage under PACE plans.

H. PACE providers shall clearly and fully inform enrollees of their right to disenroll at will upon giving 30 days' notice.

I. PACE providers shall make available to enrollees a mechanism whereby disputes relating to enrollment and services can be considered. This mechanism shall be one that is approved by DMAS.

J. PACE providers shall fully inform enrollees of the individual provider's policies regarding accessing care generally and, in particular, accessing urgent or emergency care both within and without the catchment area.

K. PACE providers shall maintain the confidentiality of enrollees and the services provided to them.

12VAC30-50-350. PACE enrollee responsibilities.

A. Enrollees shall access services through an assigned PCP. Enrollees shall be given the opportunity to choose a PCP affiliated with the applicable PACE provider. In the event an enrollee fails to choose a PCP, one shall be assigned by the provider.

B. Enrollees shall be responsible for copayments, if any.

C. Enrollees shall raise complaints relating to PACE plan coverage and services directly with the PACE provider. The provider shall have a DMAS-approved enrollee complaint process in place at all times.

D. Enrollees shall raise complaints pertaining to Medicaid eligibility and PACE plan eligibility directly to DMAS. These complaints shall be considered under DMAS' Client Appeals regulations (12VAC30-110).

E. The PACE provider shall have a grievance process in place including procedures for filing an enrollee's grievance, documenting the grievance, responding to and resolving the grievance in a timely manner, and maintaining confidentiality of the agreement pursuant to 42 CFR 460.120.

12VAC30-50-355. PACE plan contract requirements and standards.

A. Pursuant to 42 CFR Part 460 and § 32.1-330.3 of the Code of Virginia, DMAS shall establish contract requirements and standards for PACE providers.

B. At the point of PACE plan contract agreement, DMAS shall modify 12VAC30-50-320 accordingly and submit it to CMS.

C. Any expansion of PACE programs shall be on a schedule and within an area determined solely at the discretion of DMAS through a Request for Applications (RFA) process. No organization shall begin any new PACE program without going through the RFA process as required by DMAS.

12VAC30-50-360. PACE sanctions.

A. DMAS shall apply sanctions to providers for violations of PACE contract provisions or federal or state law and regulation.

B. Permissible state sanctions shall include, but need not be limited to, the following:

1. A written warning to the provider;

2. Withholding all or part of the PACE provider's capitation payments, or retracting all or part of any reimbursement previously paid;

3. Suspension of new enrollment in the PACE plan;

4. Restriction of current enrollment in the PACE plan; and

5. Contract termination.

Part I
Program of All-Inclusive Care for the Elderly (PACE) (Repealed.)

12VAC30-120-61. Definitions. (Repealed.)

For purposes of this part and all contracts establishing the Program of All-Inclusive Care for the Elderly (PACE) programs, as defined in 42 CFR Part 460, the following definitions shall apply:

"Adult day health care center" or "ADHC" means a DMAS-enrolled provider that offers a community-based day program providing a variety of health, therapeutic, and social services designed to meet the specialized needs of those elderly and disabled individuals at risk of placement in a nursing facility. The ADHC must be licensed by the Virginia Department of Social Services as an Adult Day Care Center (ADC) as defined in 22VAC40-60-10.

"Applicant" means an individual seeking enrollment in a PACE plan.

"Capitation rate" means the negotiated Medicaid monthly per capita amount paid to a PACE provider for services provided to enrollees.

"Catchment area" means the designated service area for a PACE plan.

"Centers for Medicare and Medicaid Services" or "CMS" means the unit of the U.S. Department of Health and Human Services that administers the Medicare and Medicaid programs.

"CFR" means the Code of Federal Regulations.

"DMAS" means the Department of Medical Assistance Services.

"DSS" means the Department of Social Services.

"Direct marketing" means either (i) conducting directly or indirectly door-to-door, telephonic or other "cold call" marketing of services at residences and provider sites; (ii) mailing directly; (iii) paying "finders' fees;" (iv) offering financial incentives, rewards, gifts or special opportunities to eligible individuals or family/caregivers as inducements to use the providers' services; (v) continuous, periodic marketing activities to the same prospective individual or family/caregiver for example, monthly, quarterly, or annual giveaways as inducements to use the providers' services; or (vi) engaging in marketing activities that offer potential customers rebates or discounts in conjunction with the use of the providers' services or other benefits as a means of influencing the individual's or family/caregiver's use of the providers' services.

"Enrollee" means a Medicaid-eligible individual meeting PACE enrollment criteria and receiving services from a PACE plan.

"Full disclosure" means fully informing all PACE enrollees at the time of enrollment that, pursuant to § 32.1-330.3 of the Code of Virginia, PACE plan enrollment can only be guaranteed for a 30-day period.

"Imminent risk of nursing facility placement" means that an individual will require nursing facility care within 30 days if a community-based alternative care program, such as a PACE plan, is not available.

"PACE" means a Program of All-Inclusive Care for the Elderly. PACE services are designed to enhance the quality of life and autonomy for frail, older adults, maximize dignity of, and respect for, older adults, enable frail older adults to live in the community as long as medically and socially feasible, and preserve and support the older adult's family unit.

"PACE plan" means a comprehensive acute and long-term care prepaid health plan, pursuant to § 32.1-330.3 of the Code of Virginia and as defined in 42 CFR 460.6, operating on a capitated payment basis through which the PACE provider assumes full financial risk. PACE plans operate under both Medicare and Medicaid capitation.

"PACE plan contract" means a contract, pursuant to § 32.1-330.3 of the Code of Virginia, under which an entity assumes full financial risk for operation of a comprehensive acute and long-term care prepaid health plan with capitated payments for services provided to Medicaid enrollees being made by DMAS. The parties to a PACE plan contract are the entity operating the PACE plan, DMAS and CMS.

"PACE plan feasibility study" means a study performed by a research entity approved DMAS to determine a potential PACE plan provider's ability and resources or lack thereof to effectively operate a PACE plan. All study costs are the responsibility of the potential PACE provider.

"PACE protocol" means the protocol for the Program of All-Inclusive Care for the Elderly, as published by On Lok, Inc., as of April 14, 1995, or any successor protocol that may be agreed upon by the federal Secretary of Health and Human Services and On Lok, Inc.

"PACE site" means the location, which includes a primary care center, where the PACE provider both operates the PACE plan's adult day health care center and coordinates the provision of core PACE services, including the provision of primary care.

"PACE provider" means the entity contracting with the Department of Medical Assistance Services to operate a PACE plan.

"Plan of care" means the written plan developed by the provider related solely to the specific services required by the individual to ensure optimal health and safety while receiving services from the provider.

"Preadmission screening" means the process to: (i) evaluate the functional, nursing, and social supports of individuals referred for preadmission screenings; (ii) assist individuals in determining what specific services individuals need; (iii) evaluate whether a service or a combination of existing community-based services are available to meet the individual's needs; (iv) refer individuals to the appropriate provider for Medicaid-funded nursing facility or home and community-based care for those individuals who meet nursing facility level of care.

"Preadmission screening team" means the entity contracted with DMAS that is responsible for performing preadmission screening pursuant to § 32.1-330 of the Code of Virginia.

"Primary care provider" or "PCP" means the individual responsible for the coordination of medical care provided to an enrollee under a PACE plan.

"State Plan for Medical Assistance" or "the Plan" means the Commonwealth's legal document approved by CMS identifying the covered groups, covered services and their limitations, and provider reimbursement methodologies as provided for under Title XIX of the Social Security Act.

"Virginia Uniform Assessment Instrument" or "UAI" means the standardized, multidimensional questionnaire that assesses an individual's social, physical and mental health, and functional abilities.

12VAC30-120-62. General PACE plan requirements. (Repealed.)

A. DMAS, the state agency responsible for administering Virginia's Medicaid program, shall only enter into PACE plan contracts with approved PACE plan providers. The PACE provider must have an agreement with CMS and DMAS for the operation of a PACE program. The agreement must include:

1. Designation of the program's service area;

2. The program's commitment to meet all applicable federal, state, and local requirements;

3. The effective date and term of the agreement;

4. The description of the organizational structure;

5. Participant bill of rights;

6. Description of grievance and appeals processes;

7. Policies on eligibility, enrollment, and disenrollment;

8. Description of services available;

9. Description of quality management and performance improvement program;

10. A statement of levels of performance required on standard quality measures;

11. CMS and DMAS data requirements;

12. The Medicaid capitation rate and the methodology used to calculate the Medicare capitation rate;

13. Procedures for program termination; and

14. A statement to hold harmless CMS, the state, and PACE participants if the PACE organization does not pay for services performed by the provider in accordance with the contract.

B. A PACE plan feasibility study shall be performed before DMAS enters into any PACE plan contract. DMAS shall contract only with those entities it determines to have the ability and resources to effectively operate a PACE plan. A feasibility plan shall only be submitted in response to a Request for Applications published by DMAS.

C. PACE plans shall offer a voluntary comprehensive alternative to enrollees who would otherwise be placed in a nursing facility. PACE plan services shall be comprehensive and offered as an alternative to nursing facility admission.

D. All Medicaid-enrolled PACE participants shall continue to meet the nonfinancial and financial Medicaid eligibility criteria established by federal law and these regulations. This requirement shall not apply to Medicare only or private pay PACE participants.

E. Each PACE provider shall operate a PACE site that is in continuous compliance with all state licensure requirements for that site.

F. Each PACE provider shall offer core PACE services as described in 12VAC30-120-64 B through a coordination site that is licensed as an ADHC by DSS.

G. Each PACE provider shall ensure that services are provided by health care providers and institutions that are in continuous compliance with state licensure and certification requirements.

H. Each PACE plan shall meet the requirements of §§ 32.1-330.2 and 32.1-330.3 of the Code of Virginia and 42 CFR, Part 460.

I. All PACE providers must meet the general requirements and conditions for participation pursuant to the required contracts by DMAS and CMS. All providers must sign the appropriate participation agreement. All providers must adhere to the conditions of participation outlined in the participation agreement and application to provide PACE services, DMAS regulations, policies and procedures, and CMS requirements pursuant to 42 CFR, Part 460.

J. Requests for participation as a PACE provider will be screened by DMAS to determine whether the provider applicant meets these basic requirements for participation and demonstrates the abilities to perform, at a minimum, the following activities:

1. Immediately notify DMAS, in writing, of any change in the information that the provider previously submitted to DMAS.

2. Assure freedom of choice to individuals in seeking services from any institution, pharmacy, practitioner, or other provider qualified to perform the service or services required and participating in the Medicaid Program at the time the service or services are performed.

3. Assure the individual's freedom to refuse medical care, treatment, and services.

4. Accept referrals for services only when qualified staff is available to initiate and perform such services on an ongoing basis.

5. Provide services and supplies to individuals in full compliance with Title VI of the Civil Rights Act of 1964, as amended (42 USC § 2000 et seq.), which prohibits discrimination on the grounds of race, color, religion, sexual orientation or national origin; the Virginians with Disabilities Act (§ 51.5-1 et seq. of the Code of Virginia); § 504 of the Rehabilitation Act of 1973, as amended (29 USC § 794), which prohibits discrimination on the basis of a disability; and the Americans with Disabilities Act of 1990, as amended (42 USC § 12101 et seq.), which provides comprehensive civil rights protections to individuals with disabilities in the areas of employment, public accommodations, state and local government services, and telecommunications.

6. Provide services and supplies to individuals of the same quality and in the same mode of delivery as is provided to the general public.

7. Use only DMAS-designated forms for service documentation. The provider must not alter the DMAS forms in any manner unless approval from DMAS is obtained prior to using the altered forms.

8. Not perform any type of direct marketing activities to Medicaid individuals.

9. Maintain and retain business and professional records sufficient to document fully and accurately the nature, scope, and details of the services provided.

a. In general, such records shall be retained for at least six years from the last date of service or as provided by applicable federal and state laws, whichever period is longer. However, if an audit is initiated within the required retention period, the records shall be retained until the audit is completed and every exception resolved. Records of minors shall be kept for at least six years after such minor has reached the age of 18 years. However, records for Medicare Part D shall be maintained for 10 years in accordance with 42 CFR 423.505(d).

b. Policies regarding retention of records shall apply even if the provider discontinues operation. DMAS shall be notified in writing of the storage location and procedures for obtaining records for review. The location, agent, or trustee shall be within the Commonwealth.

10. Furnish information on request and in the form requested to DMAS, the Attorney General of Virginia or his authorized representatives, federal personnel, and the state Medicaid Fraud Control Unit. The Commonwealth's right of access to provider agencies and records shall survive any termination of the provider agreement.

11. Disclose, as requested by DMAS, all financial, beneficial, ownership, equity, surety, or other interests in any and all firms, corporations, partnerships, associations, business enterprises, joint ventures, agencies, institutions, or other legal entities providing any form of health care services to individuals of Medicaid.

12. Pursuant to 42 CFR 431.300 et seq., 12VAC30-20-90, and any other applicable federal or state law, all providers shall hold confidential and use for authorized DMAS purposes only all medical assistance information regarding individuals served. A provider shall disclose information in his possession only when the information is used in conjunction with a claim for health benefits, or the data are necessary for the functioning of DMAS in conjunction with the cited laws.

13. CMS and DMAS shall be notified in writing of any change in the organizational structure of a PACE provider organization at least 14 calendar days before the change takes effect.

14. In addition to compliance with the general conditions and requirements, all providers enrolled by DMAS shall adhere to the conditions of participation outlined in their individual provider participation agreements and in the applicable DMAS provider manual. DMAS shall conduct ongoing monitoring of compliance with provider participation standards and DMAS policies. A provider's noncompliance with DMAS policies and procedures may result in a retraction of Medicaid payment or termination of the provider agreement, or both.

15. Minimum qualifications of staff.

a. All employees must have a satisfactory work record as evidenced by references from prior job experience, including no evidence of abuse, neglect, or exploitation of vulnerable adults and children. A criminal record check shall be conducted for the provider and each employee and made available for review by DMAS staff. Providers are responsible for complying with the Code of Virginia and state regulations regarding criminal record checks and barrier crimes as they pertain to the licensure and program requirements of their employees' particular practice areas.

b. Staff must meet any certifications, licensure, registration, etc., as required by applicable federal and state law. Staff qualifications must be documented and maintained for review by DMAS or its authorized contractors.

16. At the time of their admission to services, all providers participating in the Medicare and Medicaid programs must provide adult individuals with written information regarding each individual's right to make medical care decisions, including the right to accept or refuse medical treatment and the right to formulate advance directives.

K. Provider's conviction of a felony. The Medicaid provider agreement shall terminate upon conviction of the provider of a felony pursuant to § 32.1-325 of the Code of Virginia. A provider convicted of a felony in Virginia or in any other of the 50 states, the District of Columbia or, the U.S. territories, must, within 30 days, notify the Virginia Medicaid Program of this conviction and relinquish the provider agreement. In addition, termination of a provider participation agreement will occur as may be required for federal financial participation.

L. Ongoing quality management review. DMAS shall be responsible for assuring continued adherence to provider participation standards. DMAS shall conduct ongoing monitoring of compliance with provider participation standards and DMAS policies and periodically recertify each provider for participation agreement renewal with DMAS to provide PACE services.

M. Reporting suspected abuse or neglect. Pursuant to §§ 63.2-1606 and 63.2-1508 through 63.2-1513 of the Code of Virginia, if a participating provider entity suspects that a child or vulnerable adult is being abused, neglected, or exploited, the party having knowledge or suspicion of the abuse, neglect, or exploitation shall report this immediately to DSS and to DMAS. In addition, as mandated reporters for vulnerable adults, participating providers must inform their staff that they are mandated reporters and provide education regarding how to report suspected adult abuse, neglect, or exploitation pursuant to § 63.2-1606 F of the Code of Virginia.

N. Documentation requirements. The provider must maintain all records of each individual receiving services. All documentation in the individual's record must be completely signed and dated with name of the person providing the service, title, and complete date with month, day, and year. This documentation shall contain, up to and including the last date of service, all of the following:

1. The most recently updated Virginia Uniform Assessment Instrument (UAI), all other assessments and reassessments, plans of care, supporting documentation, and documentation of any inpatient hospital admissions;

2. All correspondence and related communication with the individual, and, as appropriate, consultants, providers, DMAS, DSS, or other related parties; and

3. Documentation of the date services were rendered and the amount and type of services rendered.

12VAC30-120-63. Criteria for PACE enrollment. (Repealed.)

A. Eligibility shall be determined in the manner provided for in the State Plan and these regulations. To the extent these regulations differ from other provisions of the State Plan for purposes of PACE eligibility and enrollment, these regulations shall control.

B. Individuals meeting the following nonfinancial criteria shall be eligible to enroll in PACE plans approved by DMAS:

1. Individuals who are age 55 or older;

2. Individuals who require nursing facility level of care and are at imminent risk of nursing facility placement as determined by a Nursing Home Preadmission Screening Team through a Nursing Home Preadmission Screening performed using the UAI;

3. Individuals for whom PACE plan services are medically appropriate and necessary because without the services the individual is at imminent risk of nursing facility placement;

4. Individuals who reside in a PACE plan catchment area;

5. Individuals who meet other criteria specified in a PACE plan contract;

6. Individuals who participate in the Medicaid or Medicare programs as specified in § 32.1-330.3 E of the Code of Virginia; and

7. Individuals who voluntarily enroll in a PACE plan and agree to the terms and conditions of enrollment.

C. To the extent permitted by federal law and regulation, individuals meeting the following financial criteria shall be eligible to enroll in PACE plans approved by DMAS:

1. Individuals whose income is determined by DMAS under the provision of the State Plan to be equal to or less than 300% of the current Supplemental Security Income payment standard for one person; and

2. Individuals whose resources are determined by DMAS under the provisions of the State Plan to be equal to or less than the current resource allowance established in the State Plan.

D. For purposes of a financial eligibility determination, applicants shall be considered as if they are institutionalized for the purpose of applying institutional deeming rules.

E. DMAS shall not pay for services provided to an applicant by a PACE contractor if such services are provided prior to the PACE plan authorization date set by the Nursing Home Preadmission Screening team.

12VAC30-120-64. PACE enrollee rights. (Repealed.)

A. PACE providers contractors shall ensure that enrollees are fully informed of their rights and responsibilities in accordance with all state and federal requirements. These rights and responsibilities shall include, but not be limited to:

1. The right to be fully informed at the time of enrollment that PACE plan enrollment can only be guaranteed for a 30-day period pursuant to § 32.1-330.3 F of the Code of Virginia;

2. The right to receive PACE plan services directly from the provider or under arrangements made by the provider; and

3. The right to be fully informed in writing of any action to be taken affecting the receipt of PACE plan services.

B. PACE providers shall notify enrollees of the full scope of services available under a PACE plan, as described in 42 CFR 460.92. The services shall include, but not be limited to:

1. Medical services, including the services of a PCP and other specialists;

2. Transportation services;

3. Outpatient rehabilitation services, including physical, occupational and speech therapy services;

4. Hospital (acute care) services;

5. Nursing facility (long-term care) services;

6. Prescription drugs;

7. Home health services;

8. Laboratory services;

9. Radiology services;

10. Ambulatory surgery services;

11. Respite care services;

12. Personal care services;

13. Dental services;

14. Adult day health care services, to include social work services;

15. Interdisciplinary case management services;

16. Outpatient mental health and mental retardation services;

17. Outpatient psychological services;

18. Prosthetics; and

19. Durable medical equipment and other medical supplies.

C. Services available under a PACE plan shall not include any of the following:

1. Any service not authorized by the interdisciplinary team unless such service is an emergency service (i.e., a service provided in the event of a situation of a serious or urgent nature that endangers the health, safety, or welfare of an individual and demands immediate action);

2. In an inpatient facility, private room and private duty nursing services unless medically necessary, and nonmedical items for personal convenience such as telephones charges and radio or television rental unless specifically authorized by the interdisciplinary team as part of the participant's plan of care;

3. Cosmetic surgery except as described in agency guidance documents;

4. Any experimental medical, surgical or other health procedure; and

5. Any other service excluded under 42 CFR 460.96.

D. PACE providers shall ensure that PACE plan services are at least as accessible to enrollees as they are to other Medicaid-eligible individuals residing in the applicable catchment area.

E. PACE providers shall provide enrollees with access to services authorized by the interdisciplinary team 24 hours per day every day of the year.

F. PACE providers shall provide enrollees with all information necessary to facilitate easy access to services.

G. PACE providers shall provide enrollees with identification documents approved by DMAS. PACE plan identification documents shall give notice to others of enrollees' coverage under PACE plans.

H. PACE providers shall clearly and fully inform enrollees of their right to disenroll at will upon giving 30 days' notice.

I. PACE providers shall make available to enrollees a mechanism whereby disputes relating to enrollment and services can be considered. This mechanism shall be one that is approved by DMAS.

J. PACE providers shall fully inform enrollees of the individual provider's policies regarding accessing care generally, and in particular, accessing urgent or emergency care both within and without the catchment area.

K. PACE providers shall maintain the confidentiality of enrollees and the services provided to them.

12VAC30-120-65. PACE enrollee responsibilities. (Repealed.)

A. Enrollees shall access services through an assigned PCP. Enrollees shall be given the opportunity to choose a PCP affiliated with the applicable PACE provider. In the event an enrollee fails to choose a PCP, one shall be assigned by the provider.

B. Enrollees shall be responsible for co-payments, if any.

C. Enrollees shall raise complaints relating to PACE plan coverage and services directly with the PACE provider. The provider shall have a DMAS-approved enrollee complaint process in place at all times.

D. Enrollees shall raise complaints pertaining to Medicaid eligibility and PACE plan eligibility directly to DMAS. These complaints shall be considered under DMAS' Client Appeals regulations (12VAC30-110-10 et seq.).

E. The PACE provider shall have a grievance process in place including procedures for filing an enrollee's grievance, documenting the grievance, responding to and resolving the grievance in a timely manner, and maintaining confidentiality of the agreement pursuant to 42 CFR 460.120.

12VAC30-120-66. PACE plan contract requirements and standards. (Repealed.)

A. Pursuant to 42 CFR Part 460 and § 32.1-330.3 of the Code of Virginia, DMAS shall establish contract requirements and standards for PACE providers.

B. At the point of PACE plan contract agreement, DMAS shall modify 12VAC30-50-320 accordingly and submit it to CMS.

C. Any expansion of PACE programs shall be on a schedule and within an area determined solely at the discretion of DMAS through a Request for Applications (RFA) process. No organization shall begin any new PACE program without going through the RFA process as required by DMAS.

12VAC30-120-67. PACE catastrophic coverage limitation. (Repealed.)

A. DMAS shall limit contractors' liability for Medicaid covered services required by individual enrollees when the need for services arises from a catastrophic occurrence or disease.

B. If, during a single state fiscal year period (July 1 through June 30), an enrollee receives medically necessary PACE plan services necessitated by a catastrophic occurrence or disease and the cost of those services, calculated using DMAS' applicable provider payment schedules, exceeds the catastrophic coverage limitation established in the PACE plan contract for the Medicaid capitated portion of the payments, DMAS shall compensate the contractor for Medicaid covered services provided beyond the limitation amount.

C. When this provision is invoked, DMAS shall compensate the contractor for Medicaid covered services at the rates established under the applicable Medicaid provider payment schedules.

12VAC30-120-68. PACE sanctions. (Repealed.)

A. DMAS shall apply sanctions to providers for violations of PACE contract provisions and/or federal or state law and regulation.

B. Permissible state sanctions shall include, but need not be limited to, the following:

1. A written warning to the provider;

2. Withholding all or part of the PACE provider's capitation payments, or retracting all or part of any reimbursement previously paid;

3. Suspension of new enrollment in the PACE plan;

4. Restriction of current enrollment in the PACE plan; and

5. Contract termination.

Titles of Regulations: 12VAC30-50. Amount, Duration, and Scope of Medical and Remedial Care Services (amending 12VAC30-50-320; adding 12VAC30-50-330 through 12VAC30-50-360).

12VAC30-120. Waivered Services (repealing 12VAC30-120-61 through 12VAC30-120-68).

Statutory Authority: § 32.1-325 of the Code of Virginia; 42 USC § 1396.

Public Hearing Information: No public hearings are scheduled.

Public Comments: Public comments may be submitted until 5 p.m. on January 21, 2009.

Effective Date: February 5, 2009.

Agency Contact: Deborah Pegram, Long-Term Care Services Division, Department of Medical Assistance Services, 600 East Broad Street, Suite 1300, Richmond, VA 23219, telephone (804) 371-2912, FAX (804) 786-1680, or email deborah.pegram@dmas.virginia.gov.

Basis: Section 32.1-325 of the Code of Virginia grants to the Board of Medical Assistance Services the authority to administer and amend the Plan for Medical Assistance. Section 32.1-324 of the Code of Virginia authorizes the Director of DMAS to administer and amend the Plan for Medical Assistance according to the board's requirements. The Medicaid authority as established by § 1902 (a) of the Social Security Act (42 USC § 1396a) provides governing authority for payments for services.

Purpose: The amended regulation is required in order to meet CMS’ requirements to have the PACE program categorized as a State Plan optional service and not a waiver service. These regulations must be promulgated to accomplish this action.

The purpose of PACE is to provide a community-based alternative to nursing facility care that integrates primary and long-term care services within Medicaid, but excludes Medicare financing and services. Sentara Senior Community Care, a pre-PACE provider in the Tidewater area, served 122 enrolled participants in FY 06 at a cost of $3.4 million for an average of approximately $27,655 per person. PACE combines Medicaid and Medicare funding to provide all medical, social, and long-term care services through an adult day health care center (ADHC). The pre-PACE and PACE programs allows elders to remain in familiar surroundings; maintain self-sufficiency; and preserve the highest level of physical, social, and cognitive function and independence. A nursing facility preadmission screening team must authorize PACE services. In order to continue the PACE program DMAS must move the PACE regulations out of the waiver services section of the Virginia Administrative Code and into the State Plan services section of the Administrative Code.

Rationale for Using Fast-Track Process: The fast-track regulatory process is required in order to bring the PACE regulation into compliance with DMAS' approved State Plan amendment. Except as noted for 12VAC30-120-67 in the "Substance" statement below, no language is being substantively amended; technical and grammatical changes are being recommended in four places. The primary intent of the proposed action is to move the PACE regulation from the waiver section of DMAS regulations to the State Plan section.

Substance: 12VAC30-120-67, PACE catastrophic coverage limitation, is being repealed. The remaining PACE regulations are being moved from the waiver section to the State Plan section.

In addition, four technical changes are being recommended:

1. In the "Definitions" section (12VAC30-50-330), "all" is added to the "capitation rate" definition to clarify that all necessary services are provided to PACE participants within the negotiated monthly per capita amount. This is the original intent and is clearly stated in the Request for Proposals.

2. In the "Definitions" section, "by" is added to the definition for the "PACE plan feasibility study" to correct a grammatical error.

3. Also in the "Definitions" section, "provider" is defined. The definition is taken from other existing waiver regulations and was inadvertently omitted.

4. In response to a request by the Centers for Medicare and Medicaid (CMS), in the "General PACE Plan Requirements" section at 12VAC30-50-335, "prior to the beginning of employment" is added to the existing requirement for the criminal record check process for providers and employees. This clarifies the intent of the existing language and brings the regulation into compliance with CMS requirements.

Issues: The movement of this regulation is to maintain department efforts to improve the infrastructure for community-based long-term support services by making the PACE regulation a State Plan option, allowing the state additional flexibility within the program. The PACE program creates a system of long-term services and supports that enables the elderly to remain in the community rather than in a more costly and less restrictive institutional setting.

This proposal supports Virginia’s implementation of the Olmstead decision and complements the efforts of the recently awarded Systems Transformation Grant and Money Follows the Person Demonstration that both intend to improve the infrastructure for community-based long-term support services.

There are no disadvantages to the public or the Commonwealth.

This proposed regulatory action will have a positive impact on families in allowing individuals facing institutional placement an additional home and community-based option.

The Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Amendments to Regulation. The proposed changes will move the PACE regulations from the waiver section of Medicaid regulations to the State Plan for Medical Assistance Services section.

Result of Analysis. The benefits likely exceed the costs for all proposed changes.

Estimated Economic Impact. Program of All-Inclusive Care for the Elderly (PACE) provides community based services that are alternative to nursing facility care to the recipients through an adult day health care center.

The PACE program started as a waiver program and its rules were placed in the waiver section of Medicaid regulations (12VAC30-120). On January 1, 2007, the Centers for Medicare and Medicaid (CMS) allowed Virginia to offer PACE program as an optional State Plan service rather than a waiver service. Consequently, the proposed changes will move the PACE rules into the section of Medicaid regulations where State Option service regulations are housed (12VAC30-50).

A waiver service, unlike a state plan service, waives either one of the three primary federal limitations: statewideness; comparability of services, and free choice of providers. So, making a waiver service a state plan service would normally mean a change in statewideness, comparability of services, or free choice of providers. However, in this particular case, CMS granted exemptions so that there was no change in statewideness, comparability of services, and free choice of providers. In short, the proposed movement of the regulations will produce no change in practice. Thus, no significant economic effect is expected from the proposed regulations other than providing a small benefit in terms of the consistency in housing all of the state option services under the same section.

Businesses and Entities Affected. The proposed regulations apply to PACE providers and recipients. In 2006, there were one provider and 122 enrollees.

Localities Particularly Affected. The regulations apply throughout the Commonwealth, but, the only provider was located in Tidewater area.

Projected Impact on Employment. No significant effect on employment is expected.

Effects on the Use and Value of Private Property. No significant effect on the use and value of private property is expected.

Small Businesses: Costs and Other Effects. Proposed regulations have no costs or other effects on small businesses.

Small Businesses: Alternative Method that Minimizes Adverse Impact. Proposed regulations have no adverse impact on small businesses.

Real Estate Development Costs. Proposed regulations have no real estate development costs.

Legal Mandate. The Department of Planning and Budget (DPB) has analyzed the economic impact of this proposed regulation in accordance with § 2.2-4007.04 of the Administrative Process Act and Executive Order Number 36 (06). Section 2.2-4007.04 requires that such economic impact analyses include, but need not be limited to, the projected number of businesses or other entities to whom the regulation would apply, the identity of any localities and types of businesses or other entities particularly affected, the projected number of persons and employment positions to be affected, the projected costs to affected businesses or entities to implement or comply with the regulation, and the impact on the use and value of private property. Further, if the proposed regulation has adverse effect on small businesses, § 2.2-4007.04 requires that such economic impact analyses include (i) an identification and estimate of the number of small businesses subject to the regulation; (ii) the projected reporting, recordkeeping, and other administrative costs required for small businesses to comply with the regulation, including the type of professional skills necessary for preparing required reports and other documents; (iii) a statement of the probable effect of the regulation on affected small businesses; and (iv) a description of any less intrusive or less costly alternative methods of achieving the purpose of the regulation. The analysis presented above represents DPB’s best estimate of these economic impacts.

Agency's Response to the Department of Planning and Budget's Economic Impact Analysis: The agency concurs with the economic impact analysis prepared by the Department of Planning and Budget regarding the regulations concerning Program of All-Inclusive Care for the Elderly (PACE) as State Plan Service (12VAC30-50-320, 12VAC30-50-330, 12VAC30-50-335, 12VAC30-50-340, 12VAC30-50-345, 12VAC30-50-350, 12VAC30-50-355, 12VAC30-50-360, and 12VAC30-120-61, 12VAC30-120-62, 12VAC30-120-63, 12VAC30-120-64, 12VAC30-120-65, 12VAC30-120-66, 12VAC30-120-67, and 12VAC30-120-68).

Summary

The amendments (i) move the Program of All-Inclusive Care for the Elderly (PACE) regulations from the waiver services section of the Department of Medical Assistance Services' (DMAS') regulations to the State Plan for Medical Assistance Services section, (ii) repeal 12VAC30-120-67 (PACE catastrophic coverage limitation), (iii) make technical changes to the definitions section, and (iv) require that the existing criminal record check process for providers and employees by conducted prior to the beginning of employment.

12VAC30-50-320. Program of All-Inclusive Care for the Elderly (PACE).

The Commonwealth of Virginia has not entered into a valid program agreement or agreements with a PACE provider or providers and the Secretary of the U.S. Department of Health and Human Services.

12VAC30-50-330. PACE definitions.

For purposes of this part and all contracts establishing the Program of All-Inclusive Care for the Elderly (PACE) programs as defined in 42 CFR Part 460, the following definitions shall apply:

"Adult day health care center" or "ADHC" means a DMAS-enrolled provider that offers a community-based day program providing a variety of health, therapeutic, and social services designed to meet the specialized needs of those elderly and disabled individuals at risk of placement in a nursing facility. The ADHC must be licensed by the Virginia Department of Social Services as an adult day care center (ADC) as defined in 22VAC40-60-10.

"Applicant" means an individual seeking enrollment in a PACE plan.

"Capitation rate" means the negotiated Medicaid monthly per capita amount paid to a PACE provider for all services provided to enrollees.

"Catchment area" means the designated service area for a PACE plan.

"Centers for Medicare and Medicaid Services" or "CMS" means the unit of the U.S. Department of Health and Human Services that administers the Medicare and Medicaid programs.

"CFR" means the Code of Federal Regulations.

"DMAS" means the Department of Medical Assistance Services.

"DSS" means the Department of Social Services.

"Direct marketing" means either (i) conducting directly or indirectly door-to-door, telephonic or other "cold call" marketing of services at residences and provider sites; (ii) mailing directly; (iii) paying "finders' fees;" (iv) offering financial incentives, rewards, gifts or special opportunities to eligible individuals or family/caregivers as inducements to use the providers' services; (v) continuous, periodic marketing activities to the same prospective individual or family/caregiver for example, monthly, quarterly, or annual giveaways as inducements to use the providers' services; or (vi) engaging in marketing activities that offer potential customers rebates or discounts in conjunction with the use of the providers' services or other benefits as a means of influencing the individual's or family/caregiver's use of the providers' services.

"Enrollee" means a Medicaid-eligible individual meeting PACE enrollment criteria and receiving services from a PACE plan.

"Full disclosure" means fully informing all PACE enrollees at the time of enrollment that, pursuant to § 32.1-330.3 of the Code of Virginia, PACE plan enrollment can only be guaranteed for a 30-day period.

"Imminent risk of nursing facility placement" means that an individual will require nursing facility care within 30 days if a community-based alternative care program, such as a PACE plan, is not available.

"PACE" means a Program of All-Inclusive Care for the Elderly. PACE services are designed to enhance the quality of life and autonomy for frail, older adults; maximize dignity of, and respect for, older adults; enable frail, older adults to live in the community as long as medically and socially feasible; and preserve and support the older adult's family unit.

"PACE plan" means a comprehensive acute and long-term care prepaid health plan, pursuant to § 32.1-330.3 of the Code of Virginia and as defined in 42 CFR 460.6, operating on a capitated payment basis through which the PACE provider assumes full financial risk. PACE plans operate under both Medicare and Medicaid capitation.

"PACE plan contract" means a contract, pursuant to § 32.1-330.3 of the Code of Virginia, under which an entity assumes full financial risk for operation of a comprehensive acute and long-term care prepaid health plan with capitated payments for services provided to Medicaid enrollees being made by DMAS. The parties to a PACE plan contract are the entities operating the PACE plan, DMAS and CMS.

"PACE plan feasibility study" means a study performed by a research entity approved by DMAS to determine a potential PACE plan provider's ability and resources, or lack thereof, to effectively operate a PACE plan. All study costs are the responsibility of the potential PACE provider.

"PACE protocol" means the protocol for the Program of All-Inclusive Care for the Elderly, as published by On Lok, Inc., as of April 14, 1995, or any successor protocol that may be agreed upon by the federal Secretary of Health and Human Services and On Lok, Inc.

"PACE site" means the location, which includes a primary care center, where the PACE provider both operates the PACE plan's adult day health care center and coordinates the provision of core PACE services, including the provision of primary care.

"PACE provider" means the entity contracting with the Department of Medical Assistance Services to operate a PACE plan.

"Plan of care" means the written plan developed by the provider related solely to the specific services required by the individual to ensure optimal health and safety while receiving services from the provider.

"Preadmission screening" means the process to: (i) evaluate the functional, nursing, and social supports of individuals referred for preadmission screenings; (ii) assist individuals in determining what specific services individuals need; (iii) evaluate whether a service or a combination of existing community-based services are available to meet the individual's needs; (iv) refer individuals to the appropriate provider for Medicaid-funded nursing facility or home and community-based care for those individuals who meet nursing facility level of care.

"Preadmission screening team" means the entity contracted with DMAS that is responsible for performing preadmission screening pursuant to § 32.1-330 of the Code of Virginia.

"Primary care provider" or "PCP" means the individual responsible for the coordination of medical care provided to an enrollee under a PACE plan.

"Provider" means the individual or other entity registered, licensed, or certified, as appropriate, and enrolled by DMAS to render services to Medicaid recipients eligible for services.

"State Plan for Medical Assistance" or "the Plan" means the Commonwealth's legal document approved by CMS identifying the covered groups, covered services and their limitations, and provider reimbursement methodologies as provided for under Title XIX of the Social Security Act.

"Virginia Uniform Assessment Instrument" or "UAI" means the standardized, multidimensional questionnaire that assesses an individual's social, physical and mental health, and functional abilities.

12VAC30-50-335. General PACE plan requirements.

A. DMAS, the state agency responsible for administering Virginia's Medicaid program, shall only enter into PACE plan contracts with approved PACE plan providers. The PACE provider must have an agreement with CMS and DMAS for the operation of a PACE program. The agreement must include:

1. Designation of the program's service area;

2. The program's commitment to meet all applicable federal, state, and local requirements;

3. The effective date and term of the agreement;

4. The description of the organizational structure;

5. Participant bill of rights;

6. Description of grievance and appeals processes;

7. Policies on eligibility, enrollment, and disenrollment;

8. Description of services available;

9. Description of quality management and performance improvement program;

10. A statement of levels of performance required on standard quality measures;

11. CMS and DMAS data requirements;

12. The Medicaid capitation rate and the methodology used to calculate the Medicare capitation rate;

13. Procedures for program termination; and

14. A statement to hold harmless CMS, the state, and PACE participants if the PACE organization does not pay for services performed by the provider in accordance with the contract.

B. A PACE plan feasibility study shall be performed before DMAS enters into any PACE plan contract. DMAS shall contract only with those entities it determines to have the ability and resources to effectively operate a PACE plan. A feasibility plan shall only be submitted in response to a Request for Applications published by DMAS.

C. PACE plans shall offer a voluntary comprehensive alternative to enrollees who would otherwise be placed in a nursing facility. PACE plan services shall be comprehensive and offered as an alternative to nursing facility admission.

D. All Medicaid-enrolled PACE participants shall continue to meet the nonfinancial and financial Medicaid eligibility criteria established by federal law and these regulations. This requirement shall not apply to Medicare only or private pay PACE participants.

E. Each PACE provider shall operate a PACE site that is in continuous compliance with all state licensure requirements for that site.

F. Each PACE provider shall offer core PACE services as described in 12VAC30-50-345 B through a coordination site that is licensed as an ADHC by DSS.

G. Each PACE provider shall ensure that services are provided by health care providers and institutions that are in continuous compliance with state licensure and certification requirements.

H. Each PACE plan shall meet the requirements of §§ 32.1-330.2 and 32.1-330.3 of the Code of Virginia and 42 CFR Part 460.

I. All PACE providers must meet the general requirements and conditions for participation pursuant to the required contracts by DMAS and CMS. All providers must sign the appropriate participation agreement. All providers must adhere to the conditions of participation outlined in the participation agreement and application to provide PACE services, DMAS regulations, policies and procedures, and CMS requirements pursuant to 42 CFR Part 460.

J. Requests for participation as a PACE provider will be screened by DMAS to determine whether the provider applicant meets these basic requirements for participation and demonstrates the abilities to perform, at a minimum, the following activities:

1. Immediately notify DMAS, in writing, of any change in the information that the provider previously submitted to DMAS.

2. Assure freedom of choice to individuals in seeking services from any institution, pharmacy, practitioner, or other provider qualified to perform the service or services required and participating in the Medicaid Program at the time the service or services are performed.

3. Assure the individual's freedom to refuse medical care, treatment, and services.

4. Accept referrals for services only when qualified staff is available to initiate and perform such services on an ongoing basis.

5. Provide services and supplies to individuals in full compliance with Title VI of the Civil Rights Act of 1964, as amended (42 USC § 2000 et seq.), which prohibits discrimination on the grounds of race, color, religion, sexual orientation or national origin; the Virginians with Disabilities Act (§ 51.5-1 et seq. of the Code of Virginia); § 504 of the Rehabilitation Act of 1973, as amended (29 USC § 794), which prohibits discrimination on the basis of a disability; and the Americans with Disabilities Act of 1990, as amended (42 USC § 12101 et seq.), which provides comprehensive civil rights protections to individuals with disabilities in the areas of employment, public accommodations, state and local government services, and telecommunications.

6. Provide services and supplies to individuals of the same quality and in the same mode of delivery as is provided to the general public.

7. Use only DMAS-designated forms for service documentation. The provider must not alter the DMAS forms in any manner unless approval from DMAS is obtained prior to using the altered forms.

8. Not perform any type of direct marketing activities to Medicaid individuals.

9. Maintain and retain business and professional records sufficient to document fully and accurately the nature, scope, and details of the services provided.

a. In general, such records shall be retained for at least six years from the last date of service or as provided by applicable federal and state laws, whichever period is longer. However, if an audit is initiated within the required retention period, the records shall be retained until the audit is completed and every exception resolved. Records of minors shall be kept for at least six years after such minor has reached the age of 18 years. However, records for Medicare Part D shall be maintained for 10 years in accordance with 42 CFR 423.505(d).

b. Policies regarding retention of records shall apply even if the provider discontinues operation. DMAS shall be notified in writing of the storage location and procedures for obtaining records for review. The location, agent, or trustee shall be within the Commonwealth.

10. Furnish information on request and in the form requested to DMAS, the Attorney General of Virginia or his authorized representatives, federal personnel, and the state Medicaid Fraud Control Unit. The Commonwealth's right of access to provider agencies and records shall survive any termination of the provider agreement.

11. Disclose, as requested by DMAS, all financial, beneficial, ownership, equity, surety, or other interests in any and all firms, corporations, partnerships, associations, business enterprises, joint ventures, agencies, institutions, or other legal entities providing any form of health care services to individuals of Medicaid.

12. Pursuant to 42 CFR 431.300 et seq., 12VAC30-20-90, and any other applicable federal or state law, all providers shall hold confidential and use for authorized DMAS purposes only all medical assistance information regarding individuals served. A provider shall disclose information in his possession only when the information is used in conjunction with a claim for health benefits, or the data are necessary for the functioning of DMAS in conjunction with the cited laws.

13. CMS and DMAS shall be notified in writing of any change in the organizational structure of a PACE provider organization at least 14 calendar days before the change takes effect.

14. In addition to compliance with the general conditions and requirements, all providers enrolled by DMAS shall adhere to the conditions of participation outlined in their individual provider participation agreements and in the applicable DMAS provider manual. DMAS shall conduct ongoing monitoring of compliance with provider participation standards and DMAS policies. A provider's noncompliance with DMAS policies and procedures may result in a retraction of Medicaid payment or termination of the provider agreement, or both.

15. Minimum qualifications of staff.

a. All employees must have a satisfactory work record as evidenced by references from prior job experience, including no evidence of abuse, neglect, or exploitation of vulnerable adults and children. Prior to the beginning of employment, a criminal record check shall be conducted for the provider and each employee and made available for review by DMAS staff. Providers are responsible for complying with the Code of Virginia and state regulations regarding criminal record checks and barrier crimes as they pertain to the licensure and program requirements of their employees' particular practice areas.

b. Staff must meet any certifications, licensure, registration, etc., as required by applicable federal and state law. Staff qualifications must be documented and maintained for review by DMAS or its authorized contractors.

16. At the time of their admission to services, all providers participating in the Medicare and Medicaid programs must provide adult individuals with written information regarding each individual's right to make medical care decisions, including the right to accept or refuse medical treatment and the right to formulate advance directives.

K. Provider's conviction of a felony. The Medicaid provider agreement shall terminate upon conviction of the provider of a felony pursuant to § 32.1-325 of the Code of Virginia. A provider convicted of a felony in Virginia or in any other of the 50 states, the District of Columbia, or the U.S. territories must, within 30 days, notify the Virginia Medicaid Program of this conviction and relinquish the provider agreement. In addition, termination of a provider participation agreement will occur as may be required for federal financial participation.

L. Ongoing quality management review. DMAS shall be responsible for assuring continued adherence to provider participation standards. DMAS shall conduct ongoing monitoring of compliance with provider participation standards and DMAS policies and periodically recertify each provider for participation agreement renewal with DMAS to provide PACE services.

M. Reporting suspected abuse or neglect. Pursuant to §§ 63.2-1508 through 63.2-1513 and 63.2-1606 of the Code of Virginia, if a participating provider entity suspects that a child or vulnerable adult is being abused, neglected, or exploited, the party having knowledge or suspicion of the abuse, neglect, or exploitation shall report this immediately to DSS and to DMAS. In addition, as mandated reporters for vulnerable adults, participating providers must inform their staff that they are mandated reporters and provide education regarding how to report suspected adult abuse, neglect, or exploitation pursuant to § 63.2-1606 F of the Code of Virginia.

N. Documentation requirements. The provider must maintain all records of each individual receiving services. All documentation in the individual's record must be completely signed and dated with name of the person providing the service, title, and complete date with month, day, and year. This documentation shall contain, up to and including the last date of service, all of the following:

1. The most recently updated Virginia Uniform Assessment Instrument (UAI), all other assessments and reassessments, plans of care, supporting documentation, and documentation of any inpatient hospital admissions;

2. All correspondence and related communication with the individual and, as appropriate, consultants, providers, DMAS, DSS, or other related parties; and

3. Documentation of the date services were rendered and the amount and type of services rendered.

12VAC30-50-340. Criteria for PACE enrollment.

A. Eligibility shall be determined in the manner provided for in the State Plan and these regulations. To the extent these regulations differ from other provisions of the State Plan for purposes of PACE eligibility and enrollment, these regulations shall control.

B. Individuals meeting the following nonfinancial criteria shall be eligible to enroll in PACE plans approved by DMAS:

1. Individuals who are age 55 or older;

2. Individuals who require nursing facility level of care and are at imminent risk of nursing facility placement as determined by a nursing home preadmission screening team through a nursing home preadmission screening performed using the UAI;

3. Individuals for whom PACE plan services are medically appropriate and necessary because without the services the individual is at imminent risk of nursing facility placement;

4. Individuals who reside in a PACE plan catchment area;

5. Individuals who meet other criteria specified in a PACE plan contract;

6. Individuals who participate in the Medicaid or Medicare programs as specified in § 32.1-330.3 E of the Code of Virginia; and

7. Individuals who voluntarily enroll in a PACE plan and agree to the terms and conditions of enrollment.

C. To the extent permitted by federal law and regulation, individuals meeting the following financial criteria shall be eligible to enroll in PACE plans approved by DMAS:

1. Individuals whose income is determined by DMAS under the provision of the State Plan to be equal to or less than 300% of the current Supplemental Security Income payment standard for one person; and

2. Individuals whose resources are determined by DMAS under the provisions of the State Plan to be equal to or less than the current resource allowance established in the State Plan.

D. For purposes of a financial eligibility determination, applicants shall be considered as if they are institutionalized for the purpose of applying institutional deeming rules.

E. DMAS shall not pay for services provided to an applicant by a PACE contractor if such services are provided prior to the PACE plan authorization date set by the nursing home preadmission screening team.

12VAC30-50-345. PACE enrollee rights.

A. PACE providers shall ensure that enrollees are fully informed of their rights and responsibilities in accordance with all state and federal requirements. These rights and responsibilities shall include, but not be limited to:

1. The right to be fully informed at the time of enrollment that PACE plan enrollment can only be guaranteed for a 30-day period pursuant to § 32.1-330.3 F of the Code of Virginia;

2. The right to receive PACE plan services directly from the provider or under arrangements made by the provider; and

3. The right to be fully informed in writing of any action to be taken affecting the receipt of PACE plan services.

B. PACE providers shall notify enrollees of the full scope of services available under a PACE plan, as described in 42 CFR 460.92. The services shall include, but not be limited to:

1. Medical services, including the services of a PCP and other specialists;

2. Transportation services;

3. Outpatient rehabilitation services, including physical, occupational and speech therapy services;

4. Hospital (acute care) services;

5. Nursing facility (long-term care) services;

6. Prescription drugs;

7. Home health services;

8. Laboratory services;

9. Radiology services;

10. Ambulatory surgery services;

11. Respite care services;

12. Personal care services;

13. Dental services;

14. Adult day health care services, to include social work services;

15. Interdisciplinary case management services;

16. Outpatient mental health and mental retardation services;

17. Outpatient psychological services;

18. Prosthetics; and

19. Durable medical equipment and other medical supplies.

C. Services available under a PACE plan shall not include any of the following:

1. Any service not authorized by the interdisciplinary team unless such service is an emergency service (i.e., a service provided in the event of a situation of a serious or urgent nature that endangers the health, safety, or welfare of an individual and demands immediate action);

2. In an inpatient facility, private room and private duty nursing services unless medically necessary, and nonmedical items for personal convenience such as telephones charges and radio or television rental, unless specifically authorized by the interdisciplinary team as part of the participant's plan of care;

3. Cosmetic surgery except as described in agency guidance documents;

4. Any experimental medical, surgical or other health procedure; and

5. Any other service excluded under 42 CFR 460.96.

D. PACE providers shall ensure that PACE plan services are at least as accessible to enrollees as they are to other Medicaid-eligible individuals residing in the applicable catchment area.

E. PACE providers shall provide enrollees with access to services authorized by the interdisciplinary team 24 hours per day every day of the year.

F. PACE providers shall provide enrollees with all information necessary to facilitate easy access to services.

G. PACE providers shall provide enrollees with identification documents approved by DMAS. PACE plan identification documents shall give notice to others of enrollees' coverage under PACE plans.

H. PACE providers shall clearly and fully inform enrollees of their right to disenroll at will upon giving 30 days' notice.

I. PACE providers shall make available to enrollees a mechanism whereby disputes relating to enrollment and services can be considered. This mechanism shall be one that is approved by DMAS.

J. PACE providers shall fully inform enrollees of the individual provider's policies regarding accessing care generally and, in particular, accessing urgent or emergency care both within and without the catchment area.

K. PACE providers shall maintain the confidentiality of enrollees and the services provided to them.

12VAC30-50-350. PACE enrollee responsibilities.

A. Enrollees shall access services through an assigned PCP. Enrollees shall be given the opportunity to choose a PCP affiliated with the applicable PACE provider. In the event an enrollee fails to choose a PCP, one shall be assigned by the provider.

B. Enrollees shall be responsible for copayments, if any.

C. Enrollees shall raise complaints relating to PACE plan coverage and services directly with the PACE provider. The provider shall have a DMAS-approved enrollee complaint process in place at all times.

D. Enrollees shall raise complaints pertaining to Medicaid eligibility and PACE plan eligibility directly to DMAS. These complaints shall be considered under DMAS' Client Appeals regulations (12VAC30-110).

E. The PACE provider shall have a grievance process in place including procedures for filing an enrollee's grievance, documenting the grievance, responding to and resolving the grievance in a timely manner, and maintaining confidentiality of the agreement pursuant to 42 CFR 460.120.

12VAC30-50-355. PACE plan contract requirements and standards.

A. Pursuant to 42 CFR Part 460 and § 32.1-330.3 of the Code of Virginia, DMAS shall establish contract requirements and standards for PACE providers.

B. At the point of PACE plan contract agreement, DMAS shall modify 12VAC30-50-320 accordingly and submit it to CMS.

C. Any expansion of PACE programs shall be on a schedule and within an area determined solely at the discretion of DMAS through a Request for Applications (RFA) process. No organization shall begin any new PACE program without going through the RFA process as required by DMAS.

12VAC30-50-360. PACE sanctions.

A. DMAS shall apply sanctions to providers for violations of PACE contract provisions or federal or state law and regulation.

B. Permissible state sanctions shall include, but need not be limited to, the following:

1. A written warning to the provider;

2. Withholding all or part of the PACE provider's capitation payments, or retracting all or part of any reimbursement previously paid;

3. Suspension of new enrollment in the PACE plan;

4. Restriction of current enrollment in the PACE plan; and

5. Contract termination.

Part I
Program of All-Inclusive Care for the Elderly (PACE) (Repealed.)

12VAC30-120-61. Definitions. (Repealed.)

For purposes of this part and all contracts establishing the Program of All-Inclusive Care for the Elderly (PACE) programs, as defined in 42 CFR Part 460, the following definitions shall apply:

"Adult day health care center" or "ADHC" means a DMAS-enrolled provider that offers a community-based day program providing a variety of health, therapeutic, and social services designed to meet the specialized needs of those elderly and disabled individuals at risk of placement in a nursing facility. The ADHC must be licensed by the Virginia Department of Social Services as an Adult Day Care Center (ADC) as defined in 22VAC40-60-10.

"Applicant" means an individual seeking enrollment in a PACE plan.

"Capitation rate" means the negotiated Medicaid monthly per capita amount paid to a PACE provider for services provided to enrollees.

"Catchment area" means the designated service area for a PACE plan.

"Centers for Medicare and Medicaid Services" or "CMS" means the unit of the U.S. Department of Health and Human Services that administers the Medicare and Medicaid programs.

"CFR" means the Code of Federal Regulations.

"DMAS" means the Department of Medical Assistance Services.

"DSS" means the Department of Social Services.

"Direct marketing" means either (i) conducting directly or indirectly door-to-door, telephonic or other "cold call" marketing of services at residences and provider sites; (ii) mailing directly; (iii) paying "finders' fees;" (iv) offering financial incentives, rewards, gifts or special opportunities to eligible individuals or family/caregivers as inducements to use the providers' services; (v) continuous, periodic marketing activities to the same prospective individual or family/caregiver for example, monthly, quarterly, or annual giveaways as inducements to use the providers' services; or (vi) engaging in marketing activities that offer potential customers rebates or discounts in conjunction with the use of the providers' services or other benefits as a means of influencing the individual's or family/caregiver's use of the providers' services.

"Enrollee" means a Medicaid-eligible individual meeting PACE enrollment criteria and receiving services from a PACE plan.

"Full disclosure" means fully informing all PACE enrollees at the time of enrollment that, pursuant to § 32.1-330.3 of the Code of Virginia, PACE plan enrollment can only be guaranteed for a 30-day period.

"Imminent risk of nursing facility placement" means that an individual will require nursing facility care within 30 days if a community-based alternative care program, such as a PACE plan, is not available.

"PACE" means a Program of All-Inclusive Care for the Elderly. PACE services are designed to enhance the quality of life and autonomy for frail, older adults, maximize dignity of, and respect for, older adults, enable frail older adults to live in the community as long as medically and socially feasible, and preserve and support the older adult's family unit.

"PACE plan" means a comprehensive acute and long-term care prepaid health plan, pursuant to § 32.1-330.3 of the Code of Virginia and as defined in 42 CFR 460.6, operating on a capitated payment basis through which the PACE provider assumes full financial risk. PACE plans operate under both Medicare and Medicaid capitation.

"PACE plan contract" means a contract, pursuant to § 32.1-330.3 of the Code of Virginia, under which an entity assumes full financial risk for operation of a comprehensive acute and long-term care prepaid health plan with capitated payments for services provided to Medicaid enrollees being made by DMAS. The parties to a PACE plan contract are the entity operating the PACE plan, DMAS and CMS.

"PACE plan feasibility study" means a study performed by a research entity approved DMAS to determine a potential PACE plan provider's ability and resources or lack thereof to effectively operate a PACE plan. All study costs are the responsibility of the potential PACE provider.

"PACE protocol" means the protocol for the Program of All-Inclusive Care for the Elderly, as published by On Lok, Inc., as of April 14, 1995, or any successor protocol that may be agreed upon by the federal Secretary of Health and Human Services and On Lok, Inc.

"PACE site" means the location, which includes a primary care center, where the PACE provider both operates the PACE plan's adult day health care center and coordinates the provision of core PACE services, including the provision of primary care.

"PACE provider" means the entity contracting with the Department of Medical Assistance Services to operate a PACE plan.

"Plan of care" means the written plan developed by the provider related solely to the specific services required by the individual to ensure optimal health and safety while receiving services from the provider.

"Preadmission screening" means the process to: (i) evaluate the functional, nursing, and social supports of individuals referred for preadmission screenings; (ii) assist individuals in determining what specific services individuals need; (iii) evaluate whether a service or a combination of existing community-based services are available to meet the individual's needs; (iv) refer individuals to the appropriate provider for Medicaid-funded nursing facility or home and community-based care for those individuals who meet nursing facility level of care.

"Preadmission screening team" means the entity contracted with DMAS that is responsible for performing preadmission screening pursuant to § 32.1-330 of the Code of Virginia.

"Primary care provider" or "PCP" means the individual responsible for the coordination of medical care provided to an enrollee under a PACE plan.

"State Plan for Medical Assistance" or "the Plan" means the Commonwealth's legal document approved by CMS identifying the covered groups, covered services and their limitations, and provider reimbursement methodologies as provided for under Title XIX of the Social Security Act.

"Virginia Uniform Assessment Instrument" or "UAI" means the standardized, multidimensional questionnaire that assesses an individual's social, physical and mental health, and functional abilities.

12VAC30-120-62. General PACE plan requirements. (Repealed.)

A. DMAS, the state agency responsible for administering Virginia's Medicaid program, shall only enter into PACE plan contracts with approved PACE plan providers. The PACE provider must have an agreement with CMS and DMAS for the operation of a PACE program. The agreement must include:

1. Designation of the program's service area;

2. The program's commitment to meet all applicable federal, state, and local requirements;

3. The effective date and term of the agreement;

4. The description of the organizational structure;

5. Participant bill of rights;

6. Description of grievance and appeals processes;

7. Policies on eligibility, enrollment, and disenrollment;

8. Description of services available;

9. Description of quality management and performance improvement program;

10. A statement of levels of performance required on standard quality measures;

11. CMS and DMAS data requirements;

12. The Medicaid capitation rate and the methodology used to calculate the Medicare capitation rate;

13. Procedures for program termination; and

14. A statement to hold harmless CMS, the state, and PACE participants if the PACE organization does not pay for services performed by the provider in accordance with the contract.

B. A PACE plan feasibility study shall be performed before DMAS enters into any PACE plan contract. DMAS shall contract only with those entities it determines to have the ability and resources to effectively operate a PACE plan. A feasibility plan shall only be submitted in response to a Request for Applications published by DMAS.

C. PACE plans shall offer a voluntary comprehensive alternative to enrollees who would otherwise be placed in a nursing facility. PACE plan services shall be comprehensive and offered as an alternative to nursing facility admission.

D. All Medicaid-enrolled PACE participants shall continue to meet the nonfinancial and financial Medicaid eligibility criteria established by federal law and these regulations. This requirement shall not apply to Medicare only or private pay PACE participants.

E. Each PACE provider shall operate a PACE site that is in continuous compliance with all state licensure requirements for that site.

F. Each PACE provider shall offer core PACE services as described in 12VAC30-120-64 B through a coordination site that is licensed as an ADHC by DSS.

G. Each PACE provider shall ensure that services are provided by health care providers and institutions that are in continuous compliance with state licensure and certification requirements.

H. Each PACE plan shall meet the requirements of §§ 32.1-330.2 and 32.1-330.3 of the Code of Virginia and 42 CFR, Part 460.

I. All PACE providers must meet the general requirements and conditions for participation pursuant to the required contracts by DMAS and CMS. All providers must sign the appropriate participation agreement. All providers must adhere to the conditions of participation outlined in the participation agreement and application to provide PACE services, DMAS regulations, policies and procedures, and CMS requirements pursuant to 42 CFR, Part 460.

J. Requests for participation as a PACE provider will be screened by DMAS to determine whether the provider applicant meets these basic requirements for participation and demonstrates the abilities to perform, at a minimum, the following activities:

1. Immediately notify DMAS, in writing, of any change in the information that the provider previously submitted to DMAS.

2. Assure freedom of choice to individuals in seeking services from any institution, pharmacy, practitioner, or other provider qualified to perform the service or services required and participating in the Medicaid Program at the time the service or services are performed.

3. Assure the individual's freedom to refuse medical care, treatment, and services.

4. Accept referrals for services only when qualified staff is available to initiate and perform such services on an ongoing basis.

5. Provide services and supplies to individuals in full compliance with Title VI of the Civil Rights Act of 1964, as amended (42 USC § 2000 et seq.), which prohibits discrimination on the grounds of race, color, religion, sexual orientation or national origin; the Virginians with Disabilities Act (§ 51.5-1 et seq. of the Code of Virginia); § 504 of the Rehabilitation Act of 1973, as amended (29 USC § 794), which prohibits discrimination on the basis of a disability; and the Americans with Disabilities Act of 1990, as amended (42 USC § 12101 et seq.), which provides comprehensive civil rights protections to individuals with disabilities in the areas of employment, public accommodations, state and local government services, and telecommunications.

6. Provide services and supplies to individuals of the same quality and in the same mode of delivery as is provided to the general public.

7. Use only DMAS-designated forms for service documentation. The provider must not alter the DMAS forms in any manner unless approval from DMAS is obtained prior to using the altered forms.

8. Not perform any type of direct marketing activities to Medicaid individuals.

9. Maintain and retain business and professional records sufficient to document fully and accurately the nature, scope, and details of the services provided.

a. In general, such records shall be retained for at least six years from the last date of service or as provided by applicable federal and state laws, whichever period is longer. However, if an audit is initiated within the required retention period, the records shall be retained until the audit is completed and every exception resolved. Records of minors shall be kept for at least six years after such minor has reached the age of 18 years. However, records for Medicare Part D shall be maintained for 10 years in accordance with 42 CFR 423.505(d).

b. Policies regarding retention of records shall apply even if the provider discontinues operation. DMAS shall be notified in writing of the storage location and procedures for obtaining records for review. The location, agent, or trustee shall be within the Commonwealth.

10. Furnish information on request and in the form requested to DMAS, the Attorney General of Virginia or his authorized representatives, federal personnel, and the state Medicaid Fraud Control Unit. The Commonwealth's right of access to provider agencies and records shall survive any termination of the provider agreement.

11. Disclose, as requested by DMAS, all financial, beneficial, ownership, equity, surety, or other interests in any and all firms, corporations, partnerships, associations, business enterprises, joint ventures, agencies, institutions, or other legal entities providing any form of health care services to individuals of Medicaid.

12. Pursuant to 42 CFR 431.300 et seq., 12VAC30-20-90, and any other applicable federal or state law, all providers shall hold confidential and use for authorized DMAS purposes only all medical assistance information regarding individuals served. A provider shall disclose information in his possession only when the information is used in conjunction with a claim for health benefits, or the data are necessary for the functioning of DMAS in conjunction with the cited laws.

13. CMS and DMAS shall be notified in writing of any change in the organizational structure of a PACE provider organization at least 14 calendar days before the change takes effect.

14. In addition to compliance with the general conditions and requirements, all providers enrolled by DMAS shall adhere to the conditions of participation outlined in their individual provider participation agreements and in the applicable DMAS provider manual. DMAS shall conduct ongoing monitoring of compliance with provider participation standards and DMAS policies. A provider's noncompliance with DMAS policies and procedures may result in a retraction of Medicaid payment or termination of the provider agreement, or both.

15. Minimum qualifications of staff.

a. All employees must have a satisfactory work record as evidenced by references from prior job experience, including no evidence of abuse, neglect, or exploitation of vulnerable adults and children. A criminal record check shall be conducted for the provider and each employee and made available for review by DMAS staff. Providers are responsible for complying with the Code of Virginia and state regulations regarding criminal record checks and barrier crimes as they pertain to the licensure and program requirements of their employees' particular practice areas.

b. Staff must meet any certifications, licensure, registration, etc., as required by applicable federal and state law. Staff qualifications must be documented and maintained for review by DMAS or its authorized contractors.

16. At the time of their admission to services, all providers participating in the Medicare and Medicaid programs must provide adult individuals with written information regarding each individual's right to make medical care decisions, including the right to accept or refuse medical treatment and the right to formulate advance directives.

K. Provider's conviction of a felony. The Medicaid provider agreement shall terminate upon conviction of the provider of a felony pursuant to § 32.1-325 of the Code of Virginia. A provider convicted of a felony in Virginia or in any other of the 50 states, the District of Columbia or, the U.S. territories, must, within 30 days, notify the Virginia Medicaid Program of this conviction and relinquish the provider agreement. In addition, termination of a provider participation agreement will occur as may be required for federal financial participation.

L. Ongoing quality management review. DMAS shall be responsible for assuring continued adherence to provider participation standards. DMAS shall conduct ongoing monitoring of compliance with provider participation standards and DMAS policies and periodically recertify each provider for participation agreement renewal with DMAS to provide PACE services.

M. Reporting suspected abuse or neglect. Pursuant to §§ 63.2-1606 and 63.2-1508 through 63.2-1513 of the Code of Virginia, if a participating provider entity suspects that a child or vulnerable adult is being abused, neglected, or exploited, the party having knowledge or suspicion of the abuse, neglect, or exploitation shall report this immediately to DSS and to DMAS. In addition, as mandated reporters for vulnerable adults, participating providers must inform their staff that they are mandated reporters and provide education regarding how to report suspected adult abuse, neglect, or exploitation pursuant to § 63.2-1606 F of the Code of Virginia.

N. Documentation requirements. The provider must maintain all records of each individual receiving services. All documentation in the individual's record must be completely signed and dated with name of the person providing the service, title, and complete date with month, day, and year. This documentation shall contain, up to and including the last date of service, all of the following:

1. The most recently updated Virginia Uniform Assessment Instrument (UAI), all other assessments and reassessments, plans of care, supporting documentation, and documentation of any inpatient hospital admissions;

2. All correspondence and related communication with the individual, and, as appropriate, consultants, providers, DMAS, DSS, or other related parties; and

3. Documentation of the date services were rendered and the amount and type of services rendered.

12VAC30-120-63. Criteria for PACE enrollment. (Repealed.)

A. Eligibility shall be determined in the manner provided for in the State Plan and these regulations. To the extent these regulations differ from other provisions of the State Plan for purposes of PACE eligibility and enrollment, these regulations shall control.

B. Individuals meeting the following nonfinancial criteria shall be eligible to enroll in PACE plans approved by DMAS:

1. Individuals who are age 55 or older;

2. Individuals who require nursing facility level of care and are at imminent risk of nursing facility placement as determined by a Nursing Home Preadmission Screening Team through a Nursing Home Preadmission Screening performed using the UAI;

3. Individuals for whom PACE plan services are medically appropriate and necessary because without the services the individual is at imminent risk of nursing facility placement;

4. Individuals who reside in a PACE plan catchment area;

5. Individuals who meet other criteria specified in a PACE plan contract;

6. Individuals who participate in the Medicaid or Medicare programs as specified in § 32.1-330.3 E of the Code of Virginia; and

7. Individuals who voluntarily enroll in a PACE plan and agree to the terms and conditions of enrollment.

C. To the extent permitted by federal law and regulation, individuals meeting the following financial criteria shall be eligible to enroll in PACE plans approved by DMAS:

1. Individuals whose income is determined by DMAS under the provision of the State Plan to be equal to or less than 300% of the current Supplemental Security Income payment standard for one person; and

2. Individuals whose resources are determined by DMAS under the provisions of the State Plan to be equal to or less than the current resource allowance established in the State Plan.

D. For purposes of a financial eligibility determination, applicants shall be considered as if they are institutionalized for the purpose of applying institutional deeming rules.

E. DMAS shall not pay for services provided to an applicant by a PACE contractor if such services are provided prior to the PACE plan authorization date set by the Nursing Home Preadmission Screening team.

12VAC30-120-64. PACE enrollee rights. (Repealed.)

A. PACE providers contractors shall ensure that enrollees are fully informed of their rights and responsibilities in accordance with all state and federal requirements. These rights and responsibilities shall include, but not be limited to:

1. The right to be fully informed at the time of enrollment that PACE plan enrollment can only be guaranteed for a 30-day period pursuant to § 32.1-330.3 F of the Code of Virginia;

2. The right to receive PACE plan services directly from the provider or under arrangements made by the provider; and

3. The right to be fully informed in writing of any action to be taken affecting the receipt of PACE plan services.

B. PACE providers shall notify enrollees of the full scope of services available under a PACE plan, as described in 42 CFR 460.92. The services shall include, but not be limited to:

1. Medical services, including the services of a PCP and other specialists;

2. Transportation services;

3. Outpatient rehabilitation services, including physical, occupational and speech therapy services;

4. Hospital (acute care) services;

5. Nursing facility (long-term care) services;

6. Prescription drugs;

7. Home health services;

8. Laboratory services;

9. Radiology services;

10. Ambulatory surgery services;

11. Respite care services;

12. Personal care services;

13. Dental services;

14. Adult day health care services, to include social work services;

15. Interdisciplinary case management services;

16. Outpatient mental health and mental retardation services;

17. Outpatient psychological services;

18. Prosthetics; and

19. Durable medical equipment and other medical supplies.

C. Services available under a PACE plan shall not include any of the following:

1. Any service not authorized by the interdisciplinary team unless such service is an emergency service (i.e., a service provided in the event of a situation of a serious or urgent nature that endangers the health, safety, or welfare of an individual and demands immediate action);

2. In an inpatient facility, private room and private duty nursing services unless medically necessary, and nonmedical items for personal convenience such as telephones charges and radio or television rental unless specifically authorized by the interdisciplinary team as part of the participant's plan of care;

3. Cosmetic surgery except as described in agency guidance documents;

4. Any experimental medical, surgical or other health procedure; and

5. Any other service excluded under 42 CFR 460.96.

D. PACE providers shall ensure that PACE plan services are at least as accessible to enrollees as they are to other Medicaid-eligible individuals residing in the applicable catchment area.

E. PACE providers shall provide enrollees with access to services authorized by the interdisciplinary team 24 hours per day every day of the year.

F. PACE providers shall provide enrollees with all information necessary to facilitate easy access to services.

G. PACE providers shall provide enrollees with identification documents approved by DMAS. PACE plan identification documents shall give notice to others of enrollees' coverage under PACE plans.

H. PACE providers shall clearly and fully inform enrollees of their right to disenroll at will upon giving 30 days' notice.

I. PACE providers shall make available to enrollees a mechanism whereby disputes relating to enrollment and services can be considered. This mechanism shall be one that is approved by DMAS.

J. PACE providers shall fully inform enrollees of the individual provider's policies regarding accessing care generally, and in particular, accessing urgent or emergency care both within and without the catchment area.

K. PACE providers shall maintain the confidentiality of enrollees and the services provided to them.

12VAC30-120-65. PACE enrollee responsibilities. (Repealed.)

A. Enrollees shall access services through an assigned PCP. Enrollees shall be given the opportunity to choose a PCP affiliated with the applicable PACE provider. In the event an enrollee fails to choose a PCP, one shall be assigned by the provider.

B. Enrollees shall be responsible for co-payments, if any.

C. Enrollees shall raise complaints relating to PACE plan coverage and services directly with the PACE provider. The provider shall have a DMAS-approved enrollee complaint process in place at all times.

D. Enrollees shall raise complaints pertaining to Medicaid eligibility and PACE plan eligibility directly to DMAS. These complaints shall be considered under DMAS' Client Appeals regulations (12VAC30-110-10 et seq.).

E. The PACE provider shall have a grievance process in place including procedures for filing an enrollee's grievance, documenting the grievance, responding to and resolving the grievance in a timely manner, and maintaining confidentiality of the agreement pursuant to 42 CFR 460.120.

12VAC30-120-66. PACE plan contract requirements and standards. (Repealed.)

A. Pursuant to 42 CFR Part 460 and § 32.1-330.3 of the Code of Virginia, DMAS shall establish contract requirements and standards for PACE providers.

B. At the point of PACE plan contract agreement, DMAS shall modify 12VAC30-50-320 accordingly and submit it to CMS.

C. Any expansion of PACE programs shall be on a schedule and within an area determined solely at the discretion of DMAS through a Request for Applications (RFA) process. No organization shall begin any new PACE program without going through the RFA process as required by DMAS.

12VAC30-120-67. PACE catastrophic coverage limitation. (Repealed.)

A. DMAS shall limit contractors' liability for Medicaid covered services required by individual enrollees when the need for services arises from a catastrophic occurrence or disease.

B. If, during a single state fiscal year period (July 1 through June 30), an enrollee receives medically necessary PACE plan services necessitated by a catastrophic occurrence or disease and the cost of those services, calculated using DMAS' applicable provider payment schedules, exceeds the catastrophic coverage limitation established in the PACE plan contract for the Medicaid capitated portion of the payments, DMAS shall compensate the contractor for Medicaid covered services provided beyond the limitation amount.

C. When this provision is invoked, DMAS shall compensate the contractor for Medicaid covered services at the rates established under the applicable Medicaid provider payment schedules.

12VAC30-120-68. PACE sanctions. (Repealed.)

A. DMAS shall apply sanctions to providers for violations of PACE contract provisions and/or federal or state law and regulation.

B. Permissible state sanctions shall include, but need not be limited to, the following:

1. A written warning to the provider;

2. Withholding all or part of the PACE provider's capitation payments, or retracting all or part of any reimbursement previously paid;

3. Suspension of new enrollment in the PACE plan;

4. Restriction of current enrollment in the PACE plan; and

5. Contract termination.

Title of Regulation: 14VAC5-323. Preneed Life Insurance Minimum Standards for Determining Reserve Liabilities and Nonforfeiture Values (adding 14VAC5-323-10 through 14VAC5-323-70).

Statutory Authority: §§ 12.1-13 and 38.2-223 of the Code of Virginia.

Effective Date: January 1, 2009.

Agency Contact: Raquel Pino-Moreno, Principal Insurance Analyst, State Corporation Commission, Bureau of Insurance, 1300 East Main Street, P.O. Box 1157, Richmond, VA 23218, telephone (804) 371-9499, FAX (804) 371-9511, or email raquel.pino-moreno@scc.virginia.gov.

Summary:

The regulations increase the reserves required for preneed insurance policies by not allowing the 2001 Commissioners Standard Ordinary Mortality Table to be used (mandatory after January 1, 2012) and instead requiring that reserves be based on the older Commissioners 1980 Standard Ordinary Life Valuation Mortality Table. The regulations are based on the Preneed Life Insurance Minimum Standards for Determining Reserve Liabilities and Nonforfeiture Values Model Regulation (model), which was adopted by the National Association of Insurance Commissioners in March 2008. The higher reserves may qualify as tax reserves (tax deductible) per the Internal Revenue Code if 26 states adopt the model by January 1, 2009. There were no changes from the proposed version of the regulations.

AT RICHMOND, SEPTEMBER 9, 2008

COMMONWEALTH OF VIRGINIA

At the relation of the

STATE CORPORATION COMMISSION

CASE NO. INS-2008-00194

Ex parte: In the matter of
Adopting Rules Governing
Preneed Life Insurance
Minimum Standards for
Determining Reserve Liabilities
And Nonforfeiture Values

By Order to Take Notice ("Order") entered September 9, 2008, all interested persons were ordered to take notice that subsequent to November 14, 2008, the State Corporation Commission ("Commission") would consider the entry of an order adopting new rules proposed by the Bureau of Insurance ("Bureau") entitled "Rules Governing Preneed Life Insurance Minimum Standards for Determining Reserve Liabilities and Nonforfeiture Values" ("Rules"), set forth in Chapter 323 of Title 14 of the Virginia Administrative Code, unless on or before November 14, 2008, any person objecting to the adoption of the proposed new Rules filed a request for a hearing with the Clerk of the Commission ("Clerk").

The Order also required all interested persons to file their comments in support of or in opposition to the proposed new Rules on or before November 14, 2008.

The Funeral Directors Life Insurance Company timely filed comments with the Clerk in support of the proposed new Rules. There were no other comments or requests for a hearing filed with the Clerk.

The Bureau does not recommend further changes to the proposed new Rules and, further, recommends that the Rules be adopted as proposed.

THE COMMISSION, having considered the comments and the Bureau's recommendation, is of the opinion that the attached proposed new Rules should be adopted.

IT IS THEREFORE ORDERED THAT:

(1) The proposed new Rules at Chapter 323 of Title 14 of the Virginia Administrative Code entitled "Rules Governing Preneed Life Insurance Minimum Standards for Determining Reserve Liabilities and Nonforfeiture Values," which are attached hereto and made a part hereof, should be, and they are hereby, ADOPTED to be effective January 1, 2009.

(2) AN ATTESTED COPY hereof, together with a copy of the adopted Rules, shall be sent by the Clerk of the Commission to the Bureau in care of Deputy Commissioner Douglas C. Stolte, who forthwith shall give further notice of the adoption of the new Rules by mailing a copy of this Order, together with a clean copy of the attached Rules, to all licensed life insurers, burial societies, and fraternal benefit societies authorized by the Commission pursuant to Title 38.2 of the Code of Virginia, and certain interested parties designated by the Bureau.

(3) The Commission's Division of Information Resources forthwith shall cause a copy of this Order, together with the attached Rules, to be forwarded to the Virginia Registrar of Regulations for appropriate publication in the Virginia Register of Regulations.

(4) The Commission's Division of Information Resources shall make available this Order and the adopted Rules on the Commission's website, http://www.scc.virginia.gov/case.

(5) The Bureau shall file with the Clerk of the Commission an affidavit of compliance with the notice requirements of Ordering Paragraph (2) above.

CHAPTER 323
PRENEED LIFE INSURANCE MINIMUM STANDARDS FOR DETERMINING RESERVE LIABILITIES AND NONFORFEITURE VALUES

14VAC5-323-10. Authority.

This chapter is promulgated by the commission, pursuant to § 38.2-223 of the Code of Virginia and in accordance with §§ 38.2-3130, 38.2-3206 through 38.2-3209, and 38.2-4120 of the Code of Virginia and 14VAC5-319-40, to approve, recognize, permit, and prescribe the use of the 1980 Commissioners Standard Ordinary (CSO) Life Valuation Mortality Table for use in determining the minimum standard of valuation of reserves and the minimum standard nonforfeiture values for insurers offering preneed insurance in this Commonwealth.

14VAC5-323-20. Definitions.

The following words and terms when used in this chapter shall have the following meanings unless the context clearly indicates otherwise:

"2001 CSO Mortality Table" means that mortality table, which is included in the Proceedings of the NAIC (2nd Quarter 2002), consisting of separate rates of mortality for male and female lives, developed by the American Academy of Actuaries CSO Task Force from the Valuation Basic Mortality Table developed by the Society of Actuaries Individual Life Insurance Valuation Mortality Task Force, and adopted by the NAIC in December 2002. Unless the context indicates otherwise, the "2001 CSO Mortality Table" includes both the ultimate form of that table and the select and ultimate form of that table and includes both the smoker and nonsmoker mortality tables and the composite mortality tables. It also includes both the age-nearest-birthday and age-last-birthday bases of the mortality tables.

"Commission" means the State Corporation Commission.

"NAIC" means the National Association of Insurance Commissioners.

"Preneed insurance," "preneed insurance contract," or "preneed insurance policy" means a life insurance policy, or other life insurance contract which at issue, whether by assignment or otherwise, has for a purpose, the funding of a preneed funeral contract as defined in § 54.1-2800 of the Code of Virginia.

"Ultimate 1980 CSO" means the Commissioners 1980 Standard Ordinary Life Valuation Mortality Table without any selection factors, incorporated into the 1980 NAIC amendments to the Standard Valuation Law and Standard Nonforfeiture Law for Life Insurance models, and adopted by the NAIC in December 1983. It is a mortality table consisting of separate rates of mortality for male and female lives, developed by the Society of Actuaries Committee to recommend new mortality tables for valuation of standard individual ordinary life insurance, as set forth in Transactions, Society of Actuaries, Vol. XXXIII (1981), pp. 673 and 674.

14VAC5-323-30. Minimum valuation mortality standards.

For preneed insurance contracts, and similar policies and contracts, the minimum mortality standard for determining reserve liabilities and nonforfeiture values for both male and female insureds shall be the Ultimate 1980 CSO.

14VAC5-323-40. Minimum valuation interest rate standards.

A. The interest rates used in determining the minimum standard for valuation of preneed insurance shall be the calendar year statutory valuation interest rates as defined in §§ 38.2-3133 through 38.2-3136 of the Code of Virginia.

B. The interest rates used in determining the minimum standard for nonforfeiture values for preneed insurance shall be the calendar year statutory nonforfeiture interest rates as defined in § 38.2-3209 of the Code of Virginia.

14VAC5-323-50. Minimum valuation method standards.

A. The method used in determining the standard for the minimum valuation of reserves of preneed insurance shall be the method defined in §§ 38.2-3129 and 38.2-3130 of the Code of Virginia.

B. The method used in determining the standard for the minimum nonforfeiture values for preneed insurance shall be the method defined in § 38.2-3209 of the Code of Virginia.

14VAC5-323-60. Transition provisions.

A. For preneed insurance policies issued on or after January 1, 2009, and before January 1, 2012, the 2001 CSO Mortality Table may be used as the minimum standard for reserves and minimum standard for nonforfeiture benefits for both male and female insureds pursuant to the requirements of the rules entitled "Use of the 2001 CSO Mortality Table in Determining Minimum Reserve Liabilities and Nonforfeiture Benefits (14VAC 5-321)."

B. If an insurer elects to use the 2001 CSO Mortality Table as a minimum standard for any preneed insurance policy issued on or after January 1, 2009, and before January 1, 2012, the insurer shall provide, as a part of the actuarial opinion memorandum submitted in support of the company's asset adequacy testing, an annual written notification to the domiciliary commissioner. The notification shall include:

1. A complete list of all preneed insurance policy forms that use the 2001 CSO as a minimum standard;

2. A certification signed by the appointed actuary stating that the reserve methodology employed by the company in determining reserves for the preneed insurance policies issued after January 1, 2009, and using the 2001 CSO as a minimum standard, develops adequate reserves (for the purposes of this certification, the preneed insurance policies using the 2001 CSO as a minimum standard cannot be aggregated with any other insurance policies.); and

3. Supporting information regarding the adequacy of reserves for preneed insurance policies issued after January 1, 2009, and using the 2001 CSO as a minimum standard for reserves.

C. Preneed insurance policies issued on or after January 1, 2012, shall use the Ultimate 1980 CSO in the calculation of minimum nonforfeiture values and minimum reserves.

14VAC5-323-70. Severability.

If any provision of this chapter or the application thereof to any person or circumstance is for any reason held to be invalid, the remainder of the chapter and the application of the provision to other persons or circumstances shall not be affected thereby.

Title of Regulation: 16VAC25-20. Regulation Concerning Licensed Asbestos Contractor Notification, Asbestos Project Permits, and Permit Fees (amending 16VAC25-20-10).

Statutory Authority: §§ 40.1-22 and 40.1-51.20 of the Code of Virginia.

Effective Date: February 1, 2009.

Agency Contact: John Crisanti, Planning and Evaluation Manager, Department of Labor and Industry, Powers-Taylor Building, 13 South Thirteenth Street, Richmond, VA 23219, telephone (804) 786-4300, FAX (804) 786-8418, TTY (804) 786-2376, or email john.crisanti@doli.virginia.gov.

Summary:

The amendment clarifies that roofing, flooring and siding are the only nonfriable materials that do not become friable when installed, encapsulated or removed. The intent of the amendment is to eliminate confusion on the part of asbestos contractors who must be licensed by the Department of Professional and Occupational Regulation but who must file asbestos project permits with the Department of Labor and Industry.

16VAC25-20-10. Definitions.

The following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise:

"Activity" means from the set-up of negative air containment through the breakdown of that containment. Work within a single structure or building shall be considered as one "activity" so long as such work is not interrupted except for weekends, holidays, or delays due to inclement weather. Where containment is not required, all work within single structure or building shall be considered as one "activity."

"Asbestos" means any material containing more than 1.0% asbestos by area as determined by microscopy.

"Asbestos contractor's license" means an authorization issued by the Department of Professional and Occupational Regulation permitting a person to enter into contracts to perform an asbestos abatement project.

"Asbestos project" means an activity involving job set-up for containment, removal, encapsulation, enclosure, encasement, renovation, repair, construction or alteration of an asbestos-containing material. An asbestos project or asbestos abatement project shall not include nonfriable asbestos-containing material roofing, flooring and siding materials which material that when installed, encapsulated or removed do does not become friable.

"Asbestos supervisor" means any person so designated by an asbestos contractor who provides on-site supervision and direction to the workers engaged in asbestos projects.

"Building" means a combination of any materials, whether portable or fixed including part or parts and fixed equipment of them, that forms a structure for use or occupancy by persons or property.

"Construction" means all the on-site work done in building or altering structures from land clearance through completion, including excavation, erection, and the assembly and installation of components and equipment.

"Department" means the Department of Labor and Industry.

"Friable" means that the material when dry, may be crumbled, pulverized, or reduced to powder by hand pressure and includes previously nonfriable material after such previously nonfriable material becomes damaged to the extent that when dry it may be crumbled, pulverized, or reduced to powder by hand pressure.

"Person" means a corporation, partnership, sole proprietorship, firm, enterprise, franchise, association, or any other individual or entity.

"Residential buildings" means site-built homes, modular homes, condominium units, mobile homes, manufactured housing, and duplexes, or other multi-unit dwelling consisting of four units or less which are currently in use or intended for use only for residential purposes. Demolitions of any of the above structures which that are to be replaced by other than a residential building shall not fall within this definition.

"RFS contractor's license" means an authorization issued by the Department of Professional and Occupational Regulation permitting a person to enter into contracts to install, remove or encapsulate nonfriable asbestos-containing roofing, flooring, and siding materials.

"Site" means a specific geographically contiguous area with defined limits owned by a single entity on which asbestos removal will occur.

"Structure" means an assembly of materials, or part or parts of them, forming a construction.

Titles of Regulations: 20VAC5-312. Rules Governing Retail Access to Competitive Energy Services (amending 20VAC5-312-10, 20VAC5-312-20, 20VAC5-312-60, 20VAC5-312-80, 20VAC5-312-90; repealing 20VAC5-312-120).

20VAC5-313. Rules Governing Exemptions to Minimum Stay Requirements and Wires Charges (amending 20VAC5-313-10, 20VAC5-313-20; repealing 20VAC5-313-30).

Statutory Authority: §§ 12.1-13 and 56-576 of the Code of Virginia.

Effective Date: January 1, 2009.

Agency Contact: David Eichenlaub, Assistant Director, Economic and Finance Division, State Corporation Commission, P.O. Box 1197, Richmond, VA 23218, telephone (804) 371-9050, FAX (804) 371-9935, or email david.eichenlaub@scc.virginia.gov.

Summary:

Revisions have been made to these rules as they relate to electric energy services necessitated by the changes in the statutory requirements for the provision of retail access to electric energy services set forth in amendments by the Virginia General Assembly to the Virginia Electric Utility Restructuring Act (§ 56-576 et seq. of the Code of Virginia), renamed the Virginia Electric Utility Regulation Act. The revisions remove references to default service, modify the initiation of the reporting requirements for companies to begin with enrollment of customers under a retail access program, modify the customer information requirement on local distribution companies, modify the minimum stay requirement for electric customers, provide for an exception to the billing and payment rules for those companies offering an approved 100% renewable electric tariff to its retail customers, and eliminate the regulation governing competitive metering from 20VAC5-312. The changes to 20VAC5-313 eliminate provisions related to wires charges.

In response to comments filed by interested parties and the staff report filed by the commission’s staff, several revisions to the proposed version were made to (i) clarify how the minimum stay provisions of 20VAC5-312-80 Q will operate; (ii) reflect that consolidated billing is now permissive, not mandatory, and covered by filed utility tariffs; and (iii) add MCF, a gas usage term, to provisions previously only using the electric designations MW or kWh.

AT RICHMOND, NOVEMBER 26, 2008

COMMONWEALTH OF VIRGINIA

At the relation of the

STATE CORPORATION COMMISSION

CASE NO. PUE-2008-00061

Ex Parte: In the matter of revising the rules
of the State Corporation Commission governing
Retail Access to Competitive Energy Services

ORDER REVISING REGULATIONS

The Commission's Rules Governing Retail Access to Competitive Energy Services ("Retail Access Rules"), 20 VAC 5-312-10 et seq., were adopted in 2001^[1] and last revised in 2003.^[2] Additionally, the Rules Governing Exemptions to the Minimum Stay Requirements and Wires Charges, set forth in 20 VA 5-313-10 et seq., were adopted in 2006 as transitory regulations promulgated to be in addition to the existing Retail Access Rules.^[3]

On July 29, 2008, the Commission entered an Order For Notice of Proceeding To Consider Revisions to the Commission's Rules Governing Retail Access to Competitive Energy Services ("July 29, 2008 Order") to revise the Retail Access Rules in order to reflect statutory changes made to the Virginia Electric Utility Restructuring Act,^[4] §§ 56-576 et seq. of the Code of Virginia ("Code") by the Virginia General Assembly regarding retail access to electric energy services within the Commonwealth.^[5] The July 29, 2008 Order attached draft revisions ("Proposed Rules") prepared by the Commission Staff ("Staff"), directed that notice of the Proposed Rules be given to the public, and provided an opportunity for interested persons to file comments on, propose modifications and supplements to, and request a hearing on the Proposed Rules.

Pursuant to the July 29, 2008 Order, comments were due by September 22, 2008. The Commission received comments from Appalachian Power Company ("APCo"), Virginia Electric Cooperatives,^[6]Virginia Electric and Power Company ("Virginia Power"), and Columbia Gas of Virginia, Inc. ("CGV"). None of the parties filing comments requested a hearing on the proposed revisions. However, Virginia Power requested an opportunity to file reply comments on or before October 15, 2008, in order to address any issues in the comments filed by others or in the Staff Report scheduled to be filed on October 6, 2008. On October 3, 2008, Robert A. Vanderhye filed with the Commission a request that comments he had filed in another Commission proceeding^[7] be considered in this case, and that a hearing on the Proposed Rules be held by the Commission. Mr. Vanderhye requested that the hearing be scheduled after a decision has been reached in Case No. PUE-2008-00044, and another Commission proceeding,^[8] asserting that the decisions reached in these cases will have a bearing on any changes to the Retail Access Rules. The Staff filed a Report on October 6, 2008, as directed by July 29, 2008 Order, summarizing the comments filed by APCo, the Virginia Electric Cooperatives, Virginia Power, and CGV, and making further revisions to the Proposed Rules, where necessary, in response to the comments filed on September 22, 2008.^[9]

NOW THE COMMISSION, upon consideration of this matter, is of the opinion and finds that the regulations attached hereto should be adopted effective January 1, 2009.

In the revisions to the Code enacted under Chapters 888 and 933 of the 2007 Virginia Acts of Assembly, the General Assembly, inter alia, moved the expiration of capped rates to December 31, 2008, and limited the ability of most consumers to purchase electric generation service from competing suppliers thereafter. Residential retail consumers will have the ability to engage in a choice of competitive generation suppliers only if the incumbent electric utility does not offer an approved tariff for electric energy provided 100 percent from renewable energy. Large customers exceeding 5 MW in demand maintain the ability to shop among competitive suppliers, and nonresidential customers may seek to aggregate load up to the 5 MW threshold in order to use a competitive supplier. Accordingly, it is necessary for the Commission to revise the Retail Access Rules effective January 1, 2009, in order to have the Commission's rules and regulations properly tailored to the new regulatory paradigm prescribed by the Virginia General Assembly.

The July 29, 2008 Order provided Proposed Rules which were developed by the Staff to incorporate changes to the Retail Access Rules necessitated by the statutory changes described above. APCo, the Virginia Electric Cooperatives, Virginia Power, and CGV provided comments on the Staff's Proposed Rules, and proposed several modifications of their own, which, as will be discussed below, are adopted or rejected by this Order.

The Virginia Electric Cooperatives and Virginia Power each proposed modifications to 20 VAC 5-312-10, the "Applicability; definitions" section of the Retail Access Rules. The Virginia Electric Cooperatives suggest stating that the regulations do not apply to a utility that offers a 100% renewable energy tariff option and has no customers meeting the load threshold.^[10] We find that this modification is unnecessary. As drafted, the regulations attached hereto will operate so as to cover the various scenarios provided by the statute. As noted in the Staff Report, certain rules refer to "eligible customers" to recognize that specific regulations are not applicable to, for example, residential customers, if the Commission has approved a tariff for electric energy provided 100% from renewable energy.^[11] Virginia Power suggests that certain definitions be changed to reflect that they are only applicable to natural gas customers.^[12] We find that these proposed changes are unnecessary. For example, as noted in the Staff Report, while the 2007 statutory changes eliminated electric utilities' obligation to provide consolidated billing, the regulations have been revised to reflect that consolidated billing is no longer mandatory. ^[13] Thus, consistent with the natural gas utilities' present practice, the utilities' tariffs, as approved by the Commission, will determine billing options.

Virginia Power, CGV, and the Virginia Electric Cooperatives each proposed additional modifications to 20 VAC 5-312-20, the "General provisions" section of the Retail Access Rules. CGV suggested several technical corrections to this section, including the need for subsection N to use the gas measurement term "MCF" in addition to the electric terms MW or kWh. The Staff Report included these technical corrections in the revisions to the Proposed Rules, and we adopt them herein.

The Virginia Electric Cooperatives seek an addition to subsection F of 20 VAC 5-312-20 to reflect what they perceive as a statutory obligation under § 56‑577 A 5 of the Code for competitive suppliers that provide electricity supply service to individual retail customers to provide only 100 percent renewable energy, unless such customers can shop under § 56‑577 A 3 or A 4.^[14] Similarly, APCo requested as part of this rulemaking that the Commission affirm that Code § 56‑577 A 5 establishes that if a local distribution company offers an approved tariff for electric energy provided 100 percent from renewable energy, other competitive providers are prevented from offering all renewable energy products within that service area and may not offer a mix of 50 percent from renewable sources and 50 percent from traditional sources.^[15] We find it unnecessary to restate the statute in these rules or to address the interpretation requested by the Virginia Electric Cooperatives and APCo.

Virginia Power proposed several modifications to 20 VAC 5-312-20 on the basis that this rule applied only to natural gas local distribution companies going forward. For the same reasons discussed above, we find these proposed changes unnecessary. With regard to the reporting requirements in subsections M and N of 20 VAC 5-312-20, as set forth initially by the Staff in the Proposed Rules, the reporting requirement is activated "[u]pon enrollment of a customer to receive competitive supply service." We find this sufficient to address Virginia Power's concern that the reporting requirements will have little value given the very limited access to retail choice.^[16] Finally, as acknowledged in the Staff Report, 20 VAC 5‑312‑20 preserves the right of any electric or natural gas utility to request a waiver of any provision believed to be unwarranted or cause harm or hardship to such utility.^[17]

Virginia Power and the Virginia Electric Cooperatives each proposed additional modifications to 20 VAC 5-312-60, the "Customer information" section of the Retail Access Rules. Virginia Power asserts that it would be burdensome to continually update its mass list of eligible customers every time a competitive service provider requests a list.^[18] Virginia Power's proposed solution is to require electric local distribution companies to provide the mass list once annually.^[19] As revised by the Staff in the initial Proposed Rules, the original regulations have been amended to require the local distribution companies to update or replace their list of eligible customers annually. This annually updated list would be provided upon request of a competitive service provider. Hence, there is no burden placed upon local distribution companies to update their list every time a competitive service provider makes a request. The Staff Report notes that as revised, creation of the mass list is not necessary until a list is requested by a competitive service provider.^[20] We find that the revisions to this section set forth in the Proposed Rules by Staff adequately address this concern raised by Virginia Power.

The Virginia Electric Cooperatives proposed to define who "eligible customers" are in greater detail. We find this proposal to be unnecessary. Whether a customer is "eligible" or not is determined by the customer's class and size, and the renewable energy offerings by its incumbent provider, as stated in the Code.

Virginia Power, APCO, and the Virginia Electric Cooperatives each expressed concern regarding the revisions to 20 VAC 5-312-80 Q, as initially drafted by the Staff, regarding "minimum stay" obligations.^[21] In its Staff Report, the Staff acknowledged the potential for confusion in the revised language concerning the rules governing the minimum stay requirements and offered further clarification to those rules.^[22] As adopted herein, the 12-month minimum stay requirement applies to any electric customer with an annual peak demand of 500 kW or greater. This is the same threshold that existed in this regulation prior to this proceeding. Subsection Q is further revised to account for the statutory revisions regarding 5 MW and aggregated nonresidential retail customers set out in Code § 56‑577 requiring either a five-year notice or Commission permission to return to tariffed rates. The 12-month minimum stay period retained herein applies to returning 5 MW and aggregated nonresidential retail customers, as required by § 56-577 A 3 C of the Code. Likewise, retained from the current Retail Access Rules as set out in 20 VAC 5-313-20^[23] is the alternative for returning customers to pay market‑based rates in order to avoid the obligation of a minimum stay requirement.

Virginia Power also proposed in its comments an expansion of the minimum stay period from one year to five years for 5 MW or aggregated nonresidential retail customers.^[24] This proposal is based upon the hypothetical that if several large industrial customers return to service and leave within a year, then the utility may have started on construction of a new generation facility to meet those needs. According to Virginia Power, to allow customers with substantial electric energy requirements to jump on and off the system may do harm to customers who do not leave.^[25] We find nothing in the present enactments that necessitates an expansion of the minimum stay requirement from one to five years. The new provisions in § 56-577 requiring a five-year notice before a large or aggregated customer can return to the electric incumbent without Commission approval provides the electric incumbent and its non-shopping customers more protection than existed prior to these statutory changes. We therefore decline to adopt Virginia Power's proposed five-year minimum stay period.

CGV proposed to amend subsection F of 20 VAC 5-312-80 as it relates to customers currently receiving service from a competitive service provider. CGV's proposed modification would require the local distribution company to reject a provider enrollment submitted by a new shopping customer's provider unless it has received a timely cancellation from the present provider.^[26] As noted in the Staff Report, we have received complaints from customers whose desire to switch to a new competitive service provider has been hampered.^[27] The Staff asserts that the present provisions adequately address this issue concerning multiple enrollments, i.e., if two or more enrollments are received during the monthly enrollment period then the utility is to process the first and reject all others. However, when a new monthly enrollment period begins upon the next meter read, the customer is free to choose another competitive service provider.^[28] We agree with the Staff that a customer's right to choose a new provider should not be denied because the current provider has not submitted a cancellation to the local distribution company.

Virginia Power proposed that subsection E of 20 VAC 5-312-80 be further revised to be applicable to only natural gas customers.^[29] The Staff did not agree, but did note that a change was warranted, modifying the Proposed Rules, as attached to the Staff Report, to ensure that the regulation applies to only those with "eligible" customers.^[30] We find that the Staff adequately addresses this concern.

CGV suggested that provisions of 20 VAC 5-312-90, the "Billing and payment" section of the Retail Access Rules, be further modified to reflect the repeal of the statutory requirement to offer consolidated billing.^[31] Likewise, and consistent with its earlier approach, Virginia Power proposed to modify the regulation to have it apply to natural gas local distribution companies only.^[32] The Staff agreed with CGV that the statutory obligation to provide for consolidated billing has been removed.^[33] The language proposed by the Staff establishes that, consistent with the natural gas utilities' present practice, the utilities' tariff as approved by the Commission will determine billing options. We adopt the Staff's revisions to 20 VAC 5-312-90 A.

Virginia Power also proposed that a provision be added to this section which would require competitive service providers to support aggregating nonresidential retail customers to the extent necessary to comply with the petition and reporting requirements of § 56-577 A 4 of the Code.^[34] We find that we need not adopt such a regulation at this time. Section 56-577 A 4 b of the Code requires the Commission to impose reasonable periodic monitoring and reporting obligations in granting a petition to aggregate load. This should be sufficient to address any reporting requirements that might be addressed in a regulation. Furthermore, as § 56-577 A 4 of the Code permits certain customers to petition "for permission to aggregate or combine their demands . . . so as to become qualified to purchase electric energy from any supplier. . . ," the statute on its face does not require the participation of the competitive service provider in the petitioning process.

Finally, we deny Virginia Power's request for an opportunity to file reply comments, and the late-filed request for a hearing submitted by Robert A. Vanderhye,^[35] as unnecessary for interested persons to comment upon, and for the Commission to consider adoption of, the revised rules herein.

Accordingly, IT IS ORDERED THAT:

(1) The current Rules Governing Retail Access to Competitive Energy Services 20 VAC 5‑312‑10 et seq., and the Rules Governing Exemptions to the Minimum Stay Requirements and Wires Charges, 20 VAC 5-313-10 et seq., are hereby revised and adopted as attached to this Order, effective as of January 1, 2009.

(2) A copy of this Order with a copy of the rules adopted herein shall be forwarded to the Virginia Register of Regulations for publication.

(3) The request by Virginia Power for an opportunity to file reply comments is hereby denied.

(4) The late-filed request by Robert A. Vanderhye for a hearing on the revisions to the Retail Access Rules is hereby denied.

(5) There being nothing further to come before the Commission, this case shall be removed from the Commission's docket of active proceedings and the papers filed herein placed in the file for ended causes.

Commissioner Dimitri did not participate in this matter.

AN ATTESTED COPY hereof shall be sent by the Clerk of the Commission to: Charles E. Bayless, Esquire, Appalachian Power Company, 3 James Center, Suite 702, 1051 East Cary Street, Richmond, Virginia 23219; Samuel R. Brumberg, Esquire, LeClair Ryan, 4201 Dominion Boulevard, Suite 200, Glen Allen, Virginia 23060; M. Renae Carter, Esquire, Dominion Resources Services, Law Department, 120 Tredegar Street, P.O. Box 26532, Richmond, Virginia 23261-6532; James S. Copenhaver, Esquire, Columbia Gas of Virginia, 1809 Coyote Drive, Chester, Virginia 23836; Robert A. Vanderhye, 801 Ridge Drive, McLean, Virginia, 22101; C. Meade Browder, Jr., Senior Assistant Attorney General, Division of Consumer Counsel, Office of Attorney General, 900 East Main Street, 2nd Floor, Richmond, Virginia 23219; and the Commission's Office of General Counsel and Divisions of Energy Regulation and Economics and Finance.

^[1] Commonwealth of Virginia ex rel. State Corporation Commission, Ex Parte: In the matter of establishing rules for retail access, Case No. PUE-2001-00013, 2001 S.C.C. Ann. Rep. 536 (Final Order, June 19, 2001).

^[2] Commonwealth of Virginia, ex rel. State Corporation Commission, Ex Parte: In the matter concerning the aggregation of retail electric customers under the provisions of the Virginia Electric Utility Restructuring Act, Case No. PUE-2002-00174, 2003 S.C.C. Ann. Rep. 371 (Order Adopting Revised Regulations, April 9, 2003).

^[3] Commonwealth of Virginia ex rel. State Corporation Commission, Ex Parte: In the matter of establishing rules and regulations pursuant to the Virginia Electric Utility Restructuring Act for exemptions to minimum stay requirements and wires charges, Case No. PUE-2004-00068, 2006 S.C.C. Ann. Rep. 303 (Order on Motion and Adopting Rules and Regulations, January 4, 2006).

^[4] Title changed to Virginia Electric Utility Regulation Act pursuant to Chapter 883 of the 2008 Virginia Acts of Assembly.

^[5] See Chapters 888 and 933 of the 2007 Virginia Acts of Assembly.

^[6] Filing jointly the Virginia Electric Cooperatives are: A&N Electric Cooperative, BARC Electric Cooperative, Central Virginia Electric Cooperative, Community Electric Cooperative, Craig-Botetourt Electric Cooperative, Mecklenberg Electric Cooperative, Northern Neck Electric Cooperative, Prince George Electric Cooperative, Rappahannock Electric Cooperative, Shenandoah Valley Electric Cooperative, and Southside Electric Cooperative, and the Virginia, Maryland, & Delaware Association of Electric Cooperatives.

^[7] Application of Virginia Electric and Power Company d/b/a Dominion Virginia Power, For approval of its Renewable Energy Tariff, Case No. PUE-2008-00044.

^[8] Application of Appalachian Power Company, For approval of Renewable Power Rider, Case No. PUE-2008-00057.

^[9] The Staff Report notes the filing of the requests of Mr. Vanderhye on October 2, 2008, but neither addresses the comments referenced therein or the late-filed request for a hearing.

^[10] Virginia Electric Cooperatives Comments at 4, fn 6 (suggesting, "[i]f the local distribution company has an approved tariff for electric energy provided 100% from renewable energy pursuant to Va. Code § 56-577(A)(5), and no customers meeting the requirements of Va. Code § 56-577(A)(3) or (A)(4), then the provisions of this Chapter shall not apply.")

^[11] Staff Report at 5.

^[12] Virginia Power Comments at 5-6 (proposing changes to "Bill ready," "Consolidated billing," "Nonbilling party," and "Rate ready").

^[13] Staff Report at 8.

^[14] Virginia Electric Cooperatives Comments at 8.

^[15] APCo Comments at 2.

^[16] Virginia Power Comments at 7.

^[17] Staff Report at 5.

^[18] Virginia Power Comments at 7.

^[19] Id. at 8.

^[20] Staff Report at 7.

^[21] Virginia Power Comments at 10; APCo Comments at 1-2; Virginia Electric Cooperatives Comments at 8-9.

^[22] Staff Report at 6.

^[23] "Exemption to minimum stay provisions."

^[24] Virginia Power Comments at 11.

^[25] Id.

^[26] CGV Comments at 3.

^[27] Staff Report at 8.

^[28] Id. at 9.

^[29] Virginia Power Comments at 8.

^[30] Staff Report at 8.

^[31] CGV Comments at 3-4.

^[32] Virginia Power Comments at 13-14.

^[33] Staff Report at 8.

^[34] Virginia Power Comments at 15.

^[35] Mr. Vanderhye's request for a hearing on related issues in Case Nos. PUE-2008-00044 and PUE-2008-00057 was granted. Hearings in these two cases were held on November 12, 2008.

20VAC5-312-10. Applicability; definitions.

A. These regulations are promulgated pursuant to the provisions of the Virginia Electric Utility Restructuring Regulation Act (§ 56-576 et seq. of the Code of Virginia) and to the provisions of retail supply choice for natural gas customers, § 56-235.8 of the Code of Virginia. The provisions in this chapter apply to suppliers of electric and natural gas services including local distribution companies and competitive service providers, and govern the implementation of retail access to competitive energy services, to the extent permissible by statute, in the electricity and natural gas markets, including the conduct of market participants. The provisions in this chapter shall be effective January 1, 2009, and applicable to the implementation of full or phased-in retail access to competitive energy services in the service territory of each local distribution company.

B. The following terms when used in this chapter shall have the following meanings, unless the context clearly indicates otherwise:

"Affiliated competitive service provider" means a competitive service provider that is a separate legal entity that controls, is controlled by, or is under common control of, a local distribution company or its parent. For the purpose of this chapter, any unit or division created by a local distribution company for the purpose of acting as a competitive service provider shall be treated as an affiliated competitive service provider and shall be subject to the same provisions and regulations.

"Aggregator" means a person licensed by the State Corporation Commission that, as an agent or intermediary, (i) offers to purchase, or purchases, electricity or natural gas supply service, or both, or (ii) offers to arrange for, or arranges for, the purchase of electricity supply service or natural gas supply service, or both, for sale to, or on behalf of, two or more retail customers not controlled by or under common control with such person. The following activities shall not, in and of themselves, make a person an aggregator under this chapter: (i) furnishing legal services to two or more retail customers or competitive service providers; (ii) furnishing educational, informational, or analytical services to two or more retail customers, unless direct or indirect compensation for such services is paid by a competitive service provider supplying electricity or natural gas, or both; (iii) furnishing educational, informational, or analytical services to two or more competitive service providers; (iv) providing default service under § 56-585 of the Code of Virginia; (v) conducting business as a competitive service provider licensed under 20VAC5-312-40; and (vi) (v) engaging in actions of a retail customer, acting in common with one or more other such retail customers, to issue a request for proposal or to negotiate a purchase of electricity supply service or natural gas supply service, or both, for consumption by such retail customers.

"Billing party" means a person who renders a consolidated or separate bill directly to a retail customer for competitive energy services, or distribution services, or both.

"Bill-ready" means the consolidated billing practice in which the nonbilling party calculates each retail customer's billing charges for services provided and forwards such charges to the billing party for inclusion on the consolidated bill.

"Business day" means any calendar day or computer processing day in the Eastern United States time zone in which the general office of the applicable local distribution company is open for business with the public.

"Competitive energy service" means the retail sale of electricity supply service, natural gas supply service, or any other competitive service as provided by legislation and approved by the State Corporation Commission as part of retail access by an entity other than the local distribution company as a regulated utility. For the purpose of this chapter, competitive energy services include services provided to retail customers by aggregators.

"Competitive service provider' means a person, licensed by the State Corporation Commission, that sells or offers to sell a competitive energy service within the Commonwealth. This term includes affiliated competitive service providers, as defined above, but does not include a party that supplies electricity or natural gas, or both, exclusively for its own consumption or the consumption of one or more of its affiliates. For the purpose of this chapter, competitive service providers include aggregators.

"Competitive transition charge" means the wires charge, as provided by § 56-583 of the Code of Virginia, that is applicable to a retail customer that chooses to procure electricity supply service from a competitive service provider.

"Consolidated billing" means the rendering of a single bill to a retail customer that includes the billing charges of a competitive service provider and the billing charges of the local distribution company.

"Customer" means retail customer.

"Distribution service" means the delivery of electricity or natural gas, or both, through the distribution facilities of the local distribution company to a retail customer.

"Electricity supply service" means the generation of electricity, or when provided together, the generation of electricity and its transmission to the distribution facilities of the local distribution company on behalf of a retail customer.

"Electronic Data Interchange" (EDI) means computer-to-computer exchange of business information using common standards for high volume electronic transactions.

"Local Distribution Company" means an entity regulated by the State Corporation Commission that owns or controls the distribution facilities required for the transportation and delivery of electricity or natural gas to the retail customer.

"Minimum stay period" means the minimum period of time a customer who requests electricity supply service from the local distribution company, pursuant to § 56-582 D §§ 56-577 A 3 c, 56-577 C 1, and 56-582 D of the Code of Virginia, after a period of receiving electricity supply service from a competitive service provider, is required to use such service from the local distribution company.

"Natural gas supply service" means the procurement of natural gas, or when provided together, the procurement of natural gas and its transportation to the distribution facilities of a local distribution company on behalf of a retail customer.

"Nonbilling party" means a person who provides retail customer billing information for competitive energy services or regulated service to the billing party for the purpose of consolidated billing.

"Person" means any individual, corporation, partnership, association, company, business, trust, joint venture, or other private legal entity, and the Commonwealth or any city, county, town, authority or other political subdivision of the Commonwealth.

"Price-to-compare" means the portion of the electric local distribution company's regulated rate applicable to electricity supply service less the competitive transition charge rate or the portion of the natural gas local distribution company's regulated rate applicable to natural gas supply service.

"Rate-ready" means the consolidated billing practice in which the nonbilling party provides rate information to the billing party to calculate and include the nonbilling party's charges on the consolidated bill.

"Residential customer" means any person receiving retail distribution service under a residential tariff of the local distribution company.

"Retail access" means the opportunity for a retail customer in the Commonwealth to purchase a competitive energy service from a licensed competitive service provider seeking to sell such services to that customer.

"Retail customer" means any person who purchases retail electricity or natural gas for his or her own consumption at one or more metering points or nonmetered points of delivery located within the Commonwealth.

"Separate billing" means the rendering of separate bills to a retail customer for the billing charges of a competitive service provider and the billing charges of the local distribution company.

"Transmission provider" means an entity regulated by the Federal Energy Regulatory Commission that owns or operates, or both, the transmission facilities required for the delivery of electricity or natural gas to the local distribution company or retail customer.

"Virginia Electronic Data Transfer Working Group" (VAEDT) means the group of representatives from electric and natural gas local distribution companies, competitive service providers, the staff of the State Corporation Commission, and the Office of Attorney General whose objective is to formulate guidelines and practices for the electronic exchange of information necessitated by retail access.

20VAC5-312-20. General provisions.

A. A request for a waiver of any of the provisions in this chapter shall be considered by the State Corporation Commission on a case-by-case basis, and may be granted upon such terms and conditions as the State Corporation Commission may impose.

B. The provisions of this chapter may be enforced by the State Corporation Commission by any means authorized under applicable law or regulation. Enforcement actions may include, without limitation, the refusal to issue any license for which application has been made, and the revocation or suspension of any license previously granted. The provisions of this chapter shall not be deemed to preclude a person aggrieved by a violation of these regulations from pursuing any civil relief that may be available under state or federal law, including, without limitation, private actions for damages or other equitable relief.

C. The provisions of this chapter shall not be deemed to prohibit the local distribution company, in emergency situations, from taking actions it is otherwise authorized to take that are necessary to ensure public safety and reliability of the distribution system. The State Corporation Commission, upon a claim of inappropriate action or its own motion, may investigate and take such corrective actions as may be appropriate.

D. The State Corporation Commission maintains the right to inspect the books, papers, records and documents, and to require reports and statements, of a competitive service provider as required to verify qualifications to conduct business within the Commonwealth, to support affiliate transactions, to investigate allegations of violations of this chapter, or to resolve a complaint filed against a competitive service provider. Every competitive service provider licensed pursuant to this chapter shall establish and maintain records identifying persons or entities performing promotional or marketing activities on behalf of or in conjunction with such competitive service provider.

E. Absent the designation of a default service provider as determined by the State Corporation Commission pursuant to § 56-585 of the Code of Virginia, the The local distribution company shall provide, pursuant to the prices, terms, and conditions of its tariffs approved by the State Corporation Commission, service to all customers that do not select a competitive service provider and to customers that chose a competitive service provider but whose service is terminated for any reason.

F. A competitive service provider selling electricity supply service or natural gas supply service, or both, at retail shall:

1. Procure sufficient electric generation and transmission service or sufficient natural gas supply and delivery capability, or both, to serve the requirements of its firm customers.

2. Abide by any applicable regulation or procedure of any institution charged with ensuring the reliability of the electric or natural gas systems, including the State Corporation Commission, the North American Electric Reliability Council Corporation, and the Federal Energy Regulatory Commission, or any successor agencies thereto.

3. Comply with any obligations that the State Corporation Commission may impose to ensure access to sufficient availability of capacity.

G. The local distribution company and a competitive service provider shall not:

1. Suggest that the services provided by the local distribution company are of any different quality when competitive energy services are purchased from a particular competitive service provider; or

2. Suggest that the competitive energy services provided by a competitive service provider are being provided by the local distribution company rather than the competitive service provider.

H. The local distribution company shall conduct its forecasting, scheduling, balancing, and settlement activities in a nondiscriminatory and reasonably transparent manner.

I. The local distribution company or competitive service provider shall bear the responsibility for metering as provided by legislation and implemented by the State Corporation Commission.

J. The local distribution company and a competitive service provider, shall coordinate their customer communication activities with the State Corporation Commission's statewide consumer education campaign.

K. J. The local distribution company and a competitive service provider shall adhere to standard practices for exchanging data and information in an electronic medium as specified by the VAEDT and filed with the State Corporation Commission or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission. In the event the parties agree to initially use a means other than those specified by VAEDT or the local distribution company's tariff, then the competitive service provider shall file a plan with the State Corporation Commission's Division of Economics and Finance to implement VAEDT or tariff approved standards within 180 days of the initial retail offering.

L. K. The local distribution company and a competitive service provider that is responsible for exchanging customer information electronically with such local distribution company shall, except as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission, successfully complete EDI testing and receive certification for all EDI transactions, as outlined in the VAEDT EDI Test Plan, prior to actively enrolling customers, except as permitted by subsection K of this section.

M. L. A competitive service provider offering billing service that requires the direct delivery of a bill to a customer and that requires the electronic exchange of data with the local distribution company shall furnish, prior to enrolling the customer, a sample bill produced from the data exchanged in the EDI certification process, or comparable electronic data exchange process, as described in subsection L of this section, or a sample bill produced similarly elsewhere, to the State Corporation Commission's Division of Energy Regulation and Division of Economics and Finance.

N. The M. Upon enrollment of a customer to receive competitive supply service, the local distribution company shall file with the State Corporation Commission's Division of Energy Regulation and Division of Economics and Finance a monthly report which shall, at a minimum, include all cancellation requests alleging a customer was enrolled without authorization. Such reports shall include: (i) the approximate date of the enrollment; (ii) the identity of the competitive service provider involved; (iii) the name and address of the customer that cancelled such enrollment; and (iv) if readily available, a brief statement regarding the customer's explanation for the cancellation. Such reports shall be reviewed by commission staff and regarded as confidential unless and until the State Corporation Commission orders otherwise.

O. The N. Upon enrollment of a customer to receive competitive supply service, the local distribution company shall file with the State Corporation Commission's Division of Economics and Finance a quarterly report providing a detailed breakdown of residential and nonresidential customer switching activity. Such reports shall include, for the local distribution company, the total number of customers and corresponding amount of load eligible to switch; and, for each competitive service provider, the total number of customers and corresponding amount of load served. The amount of load shall be measured in MW [ , Mcf, ] or dekatherm capacity of peak load contribution and in kWh [ , Mcf, ] or therms of associated energy. Such reports shall be reviewed by commission staff and information specific to individual competitive service providers shall be regarded as confidential unless and until the State Corporation Commission orders otherwise.

P. O. By March 31 of each year, the provider of electricity supply service shall report to its customers and file a report with the State Corporation Commission stating to the extent feasible, fuel mix and emissions data for the prior calendar year. If such data is unavailable, the provider of electricity supply service shall file a report with the State Corporation Commission stating why it is not feasible to submit any portion of such data.

Q. P. A competitive service provider shall file a report with the State Corporation Commission by March 31 of each year to update all information required in the original application for licensure. A $100 administrative fee payable to the State Corporation Commission shall accompany this report.

R. Q. A competitive service provider shall inform the State Corporation Commission within 30 days of the following: (i) any change in its name, address and telephone numbers; (ii) any change in information regarding its affiliate status with the local distribution company; (iii) any changes to information provided pursuant to 20VAC5-312-40 A 13; and (iv) any changes to information provided pursuant to 20VAC5-312-40 A 15.

S. R. If a filing with the State Corporation Commission, made pursuant to this chapter, contains information that the local distribution company or a competitive service provider claims to be confidential, the filing may be made under seal provided it is accompanied by both a motion for protective order or other confidential treatment and an additional five copies of a redacted version of the filing to be available for public disclosure. Unredacted filings containing the confidential information shall be maintained under seal unless the State Corporation Commission orders otherwise, except that such filings shall be immediately available to the commission staff for internal use at the commission. Filings containing confidential or redacted information shall be so stated on the cover of the filing, and the precise portions of the filing containing such confidential or redacted information, including supporting material, shall be clearly marked within the filing.

20VAC5-312-60. Customer information.

A. A competitive service provider shall adequately safeguard all customer information and shall not disclose such information unless the customer authorizes disclosure or unless the information to be disclosed is already in the public domain. This provision, however, shall not restrict the disclosure of credit and payment information as currently permitted by federal and state statutes.

B. The local distribution company shall provide, upon the request of a competitive service provider, a mass list of eligible customers. A competitive service provider shall adequately safeguard all of the information included on the mass list and shall not disclose such information unless the customer authorizes disclosure or unless the information to be disclosed is already in the public domain.

1. The mass list shall include the following customer information: (i) customer name; (ii) service address; (iii) billing address; (iv) either an account number, a service delivery point, or universal identifier, as applicable; (v) meter reading date or cycle; (vi) wholesale delivery point, if applicable; (vii) rate class and subclass or rider, as applicable; (viii) load profile reference category, if not based on rate class; and (ix) up to twelve months of cumulative historic energy usage and annual peak demand information as available.

2. Prior to disclosing any information on the mass list, the local distribution company shall provide each customer the opportunity to have the information itemized in subdivision 1 of this subsection withheld, in total, from the mass list.

3. The local distribution company shall make the mass list available two months prior to implementation of full or phased-in retail access and shall update or replace the list every six months thereafter annually. Prior to each update, each customer shall be provided an opportunity to reverse the prior decision regarding the disclosure of the information included on the mass list.

4. The local distribution company shall prepare and make available the mass list by means specified by the VAEDT or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission.

C. A competitive service provider choosing to utilize the mass list shall use the most recent mass list made available by the local distribution company.

D. A competitive service provider shall obtain customer authorization prior to requesting any customer usage information not included on the mass list from the local distribution company. A competitive service provider shall provide evidence of such authorization, in the manner required to demonstrate authorization to enroll a customer in 20VAC5-312-80 B, upon request by the customer or the State Corporation Commission.

20VAC5-312-80. Enrollment and switching.

A. A competitive service provider may offer to enroll a customer upon: (i) receiving a license from the State Corporation Commission; (ii) receiving EDI certification as required from the VAEDT or completing other data exchange testing requirements as provided by the local distribution company's tariff approved by the State Corporation Commission, including the subsequent provision of a sample bill as required by 20VAC5-312-20 M L ; and (iii) completing registration with the local distribution company.

B. A competitive service provider may enroll, or modify the services provided to, a customer only after the customer has affirmatively authorized such enrollment or modification. A competitive service provider shall maintain adequate records allowing it to verify a customer's enrollment authorization. Examples of adequate records of enrollment authorization include: (i) a written contract signed by the customer; (ii) a written statement by an independent third party that witnessed or heard the customer's verbal commitments; (iii) a recording of the customer's verbal commitment; or (iv) electronic data exchange, including the Internet, provided that the competitive service provider can show that the electronic transmittal of a customer's authorization originated with the customer. Such authorization records shall contain the customer's name and address; the date the authorization was obtained; the name of the product, pricing plan, or service that is being subscribed; and acknowledgment of any switching fees, minimum contract terms or usage requirements, or cancellation fees. Such authorization records shall be retained for at least 12 months after enrollment and shall be provided within five business days upon request by the customer or the State Corporation Commission.

C. A competitive service provider shall send a written contract to a customer prior to, or contemporaneously with, sending the enrollment request to the local distribution company.

D. Upon a customer's request, a competitive service provider may re-enroll such customer at a new address under the existing contract, without acquiring new authorization records, if the competitive service provider is licensed to provide service to the customer's new address and is registered with the local distribution company.

E. The local distribution company shall advise [ a customer eligible customers ] initiating new service of the customer's right and opportunity to choose a competitive service provider.

F. In the event that multiple enrollment requests are submitted regarding the same customer within the same enrollment period, the local distribution company shall process the first one submitted and reject all others for the same enrollment period.

G. Except as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission, the competitive service provider shall submit an enrollment request to the local distribution company at least 15 days prior to the customer's next scheduled meter reading date for service to be effective on that meter reading date. For an enrollment request received less than 15 days prior to the customer's next scheduled meter reading date, service shall be effective on the customer's subsequent meter reading date, except as provided by subsection H of this section.

H. A competitive service provider may request, pursuant to the local distribution company's tariff, a special meter reading, in which case the enrollment may become effective on the date of the special meter reading. The local distribution company shall perform the requested special meter reading as promptly as working conditions permit.

I. Upon receipt of an enrollment request from a competitive service provider, the local distribution company shall, normally within one business day of receipt of such notice, mail notification to the customer advising of the enrollment request, the approximate date that the competitive service provider's service commences, and the caption and statement as to cancellation required by 20VAC5-312-70 C 8. The customer shall have until the close of business on the tenth day following the mailing of such notification to advise the local distribution company to cancel such enrollment without penalty.

J. In the event a competitive service provider receives a cancellation request within the cancellation period provided by 20VAC5-312-70 C 8 or 20VAC5-312-70 D, it shall notify, by any means specified by the VAEDT or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission, the local distribution company of the customer's cancellation in order to terminate the enrollment process.

K. In the event the local distribution company receives notice of a cancellation request from a competitive service provider or a customer within the cancellation period provided by 20VAC5-312-70 C 8 or 20VAC5-312-70 D, the local distribution company shall terminate the enrollment process by any means specified by the VAEDT or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission.

L. In the event a customer terminates a contract beyond the cancellation period as provided by 20VAC5-312-70 C 8 and 20VAC5-312-70 D, the competitive service provider or the local distribution company shall provide notice of termination to the other party by any means specified by the VAEDT or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission.

M. If a competitive service provider terminates an individual contract for any reason, including expiration of the contract, the competitive service provider shall provide notice of termination to the local distribution company by any means specified by the VAEDT or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission and also shall send written notification of such termination, for reasons other than nonpayment, to the customer at least 30 days prior to the date that service to the customer is scheduled to terminate. A competitive service provider shall send written notification to the customer for termination for nonpayment at least 15 days prior to the date that service to such customer is scheduled to terminate.

N. If the local distribution company is notified by a competitive service provider that the competitive service provider will terminate service to a customer, the local distribution company shall respond to the competitive service provider by any means specified by the VAEDT or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission to acknowledge (i) receipt of the competitive service provider's notice, and (ii) the date that the competitive service provider's service to the customer is scheduled to terminate. Additionally, the local distribution company shall send written notification to the customer, normally within five business days, that it was so informed and describe the customer's opportunity to select a new supplier. Absent the designation of a default service provider as determined by the State Corporation Commission pursuant to § 56-585 of the Code of Virginia, the The local distribution company shall inform the affected customer that if the customer does not select another competitive service provider, the local distribution company shall provide the customer's electricity supply service or natural gas supply service pursuant to the prices, terms, and conditions of its tariffs approved by the State Corporation Commission.

O. If a competitive service provider decides to terminate service to a customer class or to abandon service within the Commonwealth, the competitive service provider shall provide at least 60 days advanced written notice to the local distribution company, to the affected customers, and to the State Corporation Commission.

P. If the local distribution company issues a final bill to a customer, the local distribution company shall notify, by any means specified by the VAEDT or as otherwise provided in the local distribution company's tariff approved by the State Corporation Commission, the customer's competitive service provider.

Q. The [ If the local distribution company does not offer an approved tariff for electric energy provided 100% from renewable energy pursuant to § 56-577 A 5 of the Code of Virginia, the The ] local distribution company may require a 12-month minimum stay period for electricity customers with an annual peak demand of 500 kW or greater. [ Electricity If the local distribution company does not offer an approved tariff for electric energy provided 100% from renewable energy pursuant to § 56-577 A 5 of the Code of Virginia, such electricity ] customers that return to capped rate service provided by the local distribution company as a result of a competitive service provider's abandonment of service in the Commonwealth may choose another competitive service provider at any time without the requirement to remain for the minimum stay period of 12 months. For [ individual or aggregated ] customers greater than 5 MW and pursuant to § 56-577 A 3 c of the Code of Virginia [ , an such ] electricity [ customer customers ] choosing to purchase supply service from a licensed supplier after December 31, 2008, may return to service provided by the local distribution company upon five years' written notice and at the prices, terms, and conditions of the tariffs approved by the State Corporation Commission. Alternatively, such [ an ] electricity [ customer customers ] may seek an exemption from the State Corporation Commission to provide less than five years' notice and, if such exemption is granted, return to service provided by the local distribution company at prices based on market-based costs pursuant to § 56-577 A 3 d [ of the Code of Virginia ].

R. The local distribution company may, upon a proper showing with evidence acquired by actual experience, apply for approval from the State Corporation Commission to implement alternative minimum stay period requirements. If the applicant proposes to lower the applicability limit below 500 kW, such application shall include at a minimum, the detailed information prescribed by the State Corporation Commission in the text of its Final Order in Case No. PUE010296, or as may be revised in a subsequent order.

S. The local distribution company electing to implement a minimum-stay period in conformance with this chapter shall notify, in writing, applicable customers at least 30 days in advance of such implementation date and within each subsequent notification letter as required by 20VAC5-312-80 I. Electricity customers who have selected a competitive service provider prior to the local distribution company's notice of implementing a minimum-stay period will not be subject to the minimum stay period until such time as the customer renews an existing contract or chooses a new competitive service provider.

20VAC5-312-90. Billing and payment.

A. A competitive service provider [ shall may ] offer separate billing service or consolidated billing service, where either the local distribution company or the competitive service provider would be the billing party, to prospective customers pursuant to § 56-581.1 of the Code of Virginia and the local distribution company's tariff approved by the State Corporation Commission. Where a competitive service provider would be the billing party, prior to an initial offering of consolidated billing service to customers within the service territory of each local distribution company, and after certification as required by 20VAC5-312-20 L K, the competitive service provider shall abide by the following requirements:

1. The competitive service provider shall provide written notice, at least 30 days in advance, to the local distribution company and to the State Corporation Commission's Division of Energy Regulation and Division of Economics and Finance. The written notification to the Division of Energy Regulation and the Division of Economics and Finance shall include:

a. The anticipated date of the initial consolidated billing service offering in each local distribution company service territory in which the service will be offered.

b. Any changes in information provided by the competitive service provider in its original license application pursuant to 20VAC5-312-40 A that have not been reported to the State Corporation Commission pursuant to 20VAC5-312-20 Q P and 20VAC5-312-20 R Q.

c. The expected maximum market penetration for the provision of consolidated billing service to electricity customers during the following 12 months, including the estimated number of customers and associated annual consumption by customer type or load profile classification.

d. A representation that the electric competitive service provider has undertaken the necessary preliminary coordination efforts with tax officials of each potentially affected locality regarding the competitive service provider's obligation to collect and remit local consumption taxes and local utility consumer taxes.

2. The competitive service provider shall establish such financial security as the State Corporation Commission may require for such competitive service provider's estimated liability associated with the collection and remittance of state, local, and special regulatory consumption taxes and local utility consumer taxes.

B. Subject to the exemptions applicable to municipal electric utilities and utility consumer service cooperatives set forth in § 56-581.1 J of the Code of Virginia, a competitive service provider shall coordinate the provision of the customer-selected billing service with the local distribution company by any means specified by VAEDT or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission.

C. Consolidated billing, except as otherwise arranged through contractual agreement between the local distribution company and a competitive service provider or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission, shall:

1. Be performed under a "bill-ready" protocol.

2. Not require the billing party to purchase the accounts receivable of the nonbilling party.

3. Not require the electric local distribution company to include natural gas competitive energy service charges on a consolidated bill or the natural gas local distribution company to include electric competitive energy service charges on a consolidated bill.

4. Not require the local distribution company to exchange billing information for any customer account with more than one competitive service provider for the same billing period.

5. Comply with the local distribution company's normal billing and credit cycle requirements for distribution service.

D. In the event a competitive service provider collects security deposits or prepayments, such funds shall be held in escrow by a third party in Virginia, and the competitive service provider shall provide to the State Corporation Commission the name and address of the entity holding such deposits or prepayments.

E. A competitive service provider requiring a deposit or prepayment from a customer shall limit the amount of the deposit or prepayment to the equivalent of a customer's estimated liability for no more than three months' usage of services from the competitive service provider by that customer.

F. Customer deposits held or collected by a local distribution company shall be for only those services provided by the local distribution company. Any deposit held in excess of this amount shall be promptly credited or refunded to the customer. The local distribution company may, upon a customer's return to regulated electricity supply service or natural gas supply service, collect that portion of a customer deposit as permitted by the local distribution company's tariffs and 20VAC5-10-20.

G. Terms and conditions concerning customer disconnection for nonpayment of regulated service charges shall be set forth in each local distribution company's tariff approved by the State Corporation Commission. A customer may not be disconnected for nonpayment of unregulated service charges. If a customer receives consolidated billing service and a competitive service provider is the billing party, the local distribution company shall advise the customer directly of any pending disconnection action for nonpayment through 10 days' notice by mail, separate from the consolidated bill. Such notice shall clearly identify the amount that must be paid and the date by which such amount must be received by, and also provide instructions for direct payment to, the local distribution company to avoid disconnection.

H. The provision of consolidated billing service shall conform to the following requirements:

1. The billing party shall apply a customer's partial payment of a consolidated bill as designated by the customer, or, in the absence of a customer's designation, to charges in the following order: (i) to regulated service arrearages owed the local distribution company; (ii) to competitive energy service arrearages owed the competitive service provider; (iii) to regulated service current charges of the local distribution company; (iv) to competitive energy service current charges of the competitive service provider; and (v) to other charges.

2. Collections of state and local consumption taxes and local utility consumer taxes shall be remitted as required by law. The person responsible for collecting and remitting such taxes shall:

a. Submit simultaneously, on or before the last day of the succeeding month of collection to the State Corporation Commission's Division of Public Service Taxation, the payment of the preceding month's state and special regulatory consumption taxes and associated Electric Utility or Natural Gas Consumption Tax Monthly Report.

b. Submit simultaneously, in accordance with the Code of Virginia and local ordinance, to each local government in whose jurisdiction the taxes have been collected, the payment of local consumption taxes and local utility consumer taxes and associated tax remittance reports.

I. The local distribution company and a competitive service provider shall comply with the following minimum billing information standards applicable to all customer bills:

1. Sufficient information shall be provided or referenced on the bill so that a customer can understand and calculate the billing charges.

2. Charges for regulated services and unregulated services shall be clearly distinguished.

3. Standard terminology shall be employed and charges shall be categorized for the following key bill components, as applicable: (i) distribution service; (ii) competitive transition charge; (iii) electricity supply service or natural gas supply service; (iv) (iii) state and local consumption tax; and (v) (iv) local (or locality name) utility tax. The bill may provide further detail of each of these key components as appropriate.

4. Nonroutine charges and fees shall be itemized including late payment charges and deposit collections.

5. The total bill amount due and date by which payment must be received to avoid late payment charges shall be clearly identified.

6. The 24-hour toll-free telephone number of the local distribution company for service emergencies shall be clearly identified.

7. In the event a disconnection notice for nonpayment is included on a customer bill issued by the local distribution company, the notice shall appear on the first page of the bill and be emphasized in a manner that draws immediate attention to such notice. The notice shall clearly identify the amount that must be paid and the date by which such amount must be paid to avoid disconnection.

8. The following additional information shall be provided on customer bills to the extent applicable:

a. Customer name, service address, billing address, account number, rate schedule identifier, and meter identification number.

b. Billing party name, payment address, and toll-free telephone number for customer inquiries and complaints.

c. For consolidated bills, nonbilling party name and toll-free telephone number for customer inquiries and complaints and the customer's local distribution company account number.

d. Bill issue date and notice of change in rates.

e. Previous and current meter readings and dates of such meter readings or metering period days, current period energy consumption, meter reading unit conversion factor, billing-demand information, and "estimated" indicator for non-actual meter reads.

f. Previous bill amount or account balance, payments received since previous billing, balance forward, current charges, total amount due or current account balance, and payment plan information.

g. For consolidated bills, billing party and nonbilling party elements as specified in subdivision 8 f of this subsection.

J. The local distribution company shall comply with the following additional billing information standards applicable to the bills of customers that are not subject to demand-based billing charges and that purchase regulated electricity supply service or regulated natural gas supply service from the local distribution company:

1. The local distribution company shall employ standard terminology and categorize charges for the following key billing components: (i) distribution service; (ii) electricity supply service or natural gas supply service; (iii) state and local consumption tax; and (iv) local (or locality name) utility tax. Brief explanations of distribution service and electricity supply service or natural gas supply service shall be presented on the bill. Such explanations shall convey that distribution service is a regulated service that must be purchased from the local distribution company and that electricity supply service or natural gas supply service may be purchased from the competitive market but, if applicable, may result in a competitive transition charge;

2. The local distribution company shall provide on customer bills a customer's monthly energy consumption, numerically or graphically, for the previous 12 months; and

3. The investor-owned electric local distribution company shall provide on each bill a "price-to-compare" value, stated in cents per kilowatt-hour, representing the cost of regulated electricity supply service [ less the competitive transition charge, if any, ] that would be applicable if such service were purchased from a competitive service provider. The appropriate use and limitations of such "price-to-compare" value shall be stated on the bill.

K. The local distribution company shall develop and implement a program to provide "price-to-compare" information and assistance to customers. [ The local distribution company shall provide a program plan to the State Corporation Commission's Division of Energy Regulation at least 90 days prior to the implementation of full or phased-in retail access. ] Such a program shall ensure that customers will be provided meaningful information for evaluating competitive offers of electricity supply service or natural gas supply service. At a minimum, the program shall include a mechanism for providing, or making readily accessible, customer-specific "price-to-compare" information, including explanations of its appropriate use and limitations and, if applicable, the relationship between the regulated electricity supply charge, the competitive transition charge, and the "price-to-compare.".

L. The billing party shall, except as otherwise arranged through contractual agreement with the nonbilling party, provide sufficient space on a consolidated bill to accommodate the local distribution company's customer account number and the nonbilling party's name and toll-free telephone number, previous bill amount or account balance, payments applied since the previous billing, balance forward, total current charges, total amount due or current account balance, six additional numeric fields to detail current charges, and 240 additional text characters.

M. If the local distribution company, as the billing party, provides consolidated billing service to a customer and continues to be the customer's billing party after the customer's service with a competitive service provider terminates, the local distribution company shall, except as otherwise arranged through contractual agreement with such competitive service provider, continue to track and bill customer account arrearages owed to such competitive service provider for two billing cycles after service has terminated. The bill shall list, at a minimum, the name, toll-free telephone number, and balance due for each former competitive service provider.

N. If the current charges of the nonbilling party are not included on the consolidated bill issued by the billing party, the bill shall note that such charges are not included.

O. If the current charges of the nonbilling party are not included on the consolidated bill issued by the billing party due to causes attributable to the nonbilling party, the charges shall be billed in the following month unless the two parties mutually agree to other arrangements.

P. If the current charges of the nonbilling party are not included on the consolidated bill issued by the billing party due to causes attributable to the billing party, the bill shall be cancelled and reissued to include such charges unless the two parties mutually agree to other arrangements.

Q. The local distribution company or a competitive service provider shall report any significant deficiency regarding the timely issuance, accuracy, or completeness of customer bills to the State Corporation Commission's Division of Energy Regulation as soon as practicable. Such reports shall detail the circumstances surrounding the deficiency and the planned corrective actions.

R. If the local distribution company has an approved tariff for electric energy provided 100% from renewable energy pursuant to § 56-577 A 5 of the Code of Virginia, the provisions of [ subsections A through Q of ] this section shall not be applicable. Instead, an electric distribution company and an electric competitive service provider shall only offer separate billing service where both would be the billing party for the respective services to prospective customers pursuant to the local distribution company's tariff approved by the State Corporation Commission.

20VAC5-312-120. Electricity metering. (Repealed.)

A. If the local distribution company provides interval metering as a customer's basic metering service in accordance with its applicable tariff, interval metering of that customer's load shall continue to be required if the customer purchases electricity supply service from a competitive service provider. Unless other arrangements are agreed upon between the local distribution company and the customer, the local distribution company may remove the interval meter if the customer's load deteriorates below previously established interval metering thresholds.

B. Upon a customer's request, the local distribution company shall provide interval metering service to the customer at the net incremental cost above the basic metering service provided by the local distribution company. The local distribution company shall reply to the customer in writing within five business days of the request for interval metering service, acknowledging receipt of the request, explaining the process, and identifying the prerequisites for commencing and completing the work. Once the customer has completed the applicable prerequisites, the local distribution company shall complete the work within 45 calendar days, or as promptly as working conditions permit.

C. The local distribution company shall offer each of the following interval metering service options to customers or their authorized competitive service provider to access unedited interval data from the local distribution company's interval metering equipment and consistent with the local distribution company's communication protocol: (i) read-only electronic access to the interval billing meter, (ii) receipt of a stream of data pulses proportional to energy usage, and (iii) both of the foregoing.

D. As a component of interval metering service, the local distribution company shall read interval meters at a frequency in accordance with its applicable terms and conditions and shall store interval meter data at intervals compatible with wholesale load settlement requirements. Interval meter data may be estimated on occasion as necessary. The local distribution company shall make available to customers or their authorized competitive service provider 12 months of historical edited interval data through electronic communication medium unless otherwise requested by mail, as mutually agreed.

E. The local distribution company shall respond to requests from customers or their authorized competitive service provider to evaluate special metering functionality that may not be provided normally under the local distribution company's tariff but that is determined by the local distribution company to be within the capability of its interval metering equipment. The local distribution company shall acknowledge receipt of the requests in writing within five business days, indicating that the net incremental cost, prerequisites and process for providing the special metering functionality will be submitted in writing within 30 days. Once the customer has completed the applicable prerequisites, the local distribution company shall provide the special metering functionality within 45 calendar days, or as promptly as working conditions permit.

F. The local distribution company shall install and maintain meters owned by large industrial customers and large commercial customers if the meter is determined to be consistent with the local distribution company's billing and metering systems and communication protocol. Ownership shall apply to the meter as defined by a line of demarcation specified in the local distribution company tariff approved by the State Corporation Commission.

G. Upon a customer's request to own a meter in accordance with subsection F of this section, the local distribution company shall reply to the customer in writing within 10 days of the request, acknowledging receipt of the request, explaining the process, and identifying the prerequisites for commencing and completing the work. The local distribution company shall also explain its policies with respect to replacement of defective meters. Once the customer has completed the applicable prerequisites, the local distribution company shall complete the work within 45 days, or as promptly as working conditions permit.

H. Upon the installation of a meter owned by a customer in accordance with subsections F and G of this section, the local distribution company shall continue to have full access to the meter and shall continue to perform its normal obligations including but not limited to testing, replacement, customer accounting, reading and data management. In accordance with subsection C of this section, the local distribution company shall provide customers or their authorized competitive service provider with read-only electronic access to the meter.

20VAC5-313-10. Applicability.

A. The existing Rules Governing Retail Access to Competitive Energy Services (20VAC5-312) remain enforceable unless further qualified by the following additional rules.

B. These transitory regulations are promulgated pursuant to the amended provisions of the Virginia Electric Utility Restructuring Act (§§ 56-577 E and 56-583 of the Code of Virginia). This chapter applies to suppliers of electric services including investor-owned local distribution companies and competitive service providers, and are in addition to the existing rules of 20VAC5-312. The provisions in this chapter shall be applicable to the provision of generation service to the qualifying customers electing exemption to the current minimum stay provisions or to payment of the current wires charges. Rules applicable to the minimum stay exemption program shall remain in force until the termination of capped rates as provided under statute or State Corporation Commission order. Rules applicable to the offering of the wires charges exemption program shall remain in force until the earlier of July 1, 2007, or the termination of any wires charges.

[ 20VAC5-313-20. Exemption to minimum stay provisions.

A. This section applies to an investor-owned electric local distribution company imposing minimum stay provisions on certain customers as applicable under 20VAC5-312-80 Q and 20VAC5-312-80 R and to competitive service providers serving such customers.

B. An investor-owned electric local distribution company shall offer any customer with an annual peak demand of 500 kW or greater that returns to the service of the local distribution company the option to accept the service at pursuant to the established capped rates prices, terms, and conditions of its tariffs approved by the State Corporation Commission and abide by the current minimum stay requirements or to accept the service at market-based costs without the obligation of a minimum stay requirement.

C. The investor-owned electric local distribution company shall provide written notice, in a clear and conspicuous manner, as approved by the staff of the State Corporation Commission to qualified customers of the options identified in subsection B of this section. In addition, the investor-owned local distribution company shall supplement such written notice by providing information on its website, as approved by the staff of the State Corporation Commission, detailing the options identified in subsection B of this section.

D. The investor-owned local distribution company's notification to the customer advising that it has received a cancellation notice from the customer's competitive service provider, as required by 20VAC5-312-80 N, shall also in a clear and conspicuous manner, as approved by the staff of the State Corporation Commission, advise the customer of the options identified in subsection B of this section.

E. The investor-owned electric local distribution company shall employ the methodology to determine its market-based costs as provided in 20VAC5-313-40 and approved by the State Corporation Commission in Case No. PUE-2004-00068 for any customer electing such option and subsequently returning to the local distribution company.

F. The investor-owned electric local distribution company shall submit a tariff containing the market-based prices determined in subsection E of this section to the State Corporation Commission for approval prior to implementing such prices. ]

20VAC5-313-30. Exemption to wires charges. (Repealed.)

A. This section applies to an investor-owned electric local distribution company imposing wires charges on its customers, except those customers participating in pilot programs approved by the State Corporation Commission in Case No. PUE-2003-00118, and to competitive service providers serving such customers.

B. The investor-owned electric local distribution company shall offer large industrial customers or large commercial customers, as well as any group of customers of any rate class aggregated together, subject to the participation limits of subsection I of this section, and upon the customer's notice to participate at least 60 days in advance, the option to purchase retail electric energy from licensed competitive service providers without the obligation to pay any wires charges imposed by the utility in exchange for the customers' agreement to pay market-based costs upon any subsequent return to service of the local distribution company.

C. The investor-owned electric local distribution company shall provide written notice, in a clear and conspicuous manner, as approved by the staff of the State Corporation Commission, to qualified customers of the options identified in subsection B of this section and associated risks, particularly the customer's inability to ever return to service of the local distribution company at capped rates. In addition, the investor-owned local distribution company shall supplement such written notice by providing information on its website, as approved by the staff of the State Corporation Commission, detailing the options identified in subsection B of this section.

D. The investor-owned electric local distribution company shall employ the methodology to determine its market-based costs as provided in 20VAC5-313-40 and approved by the State Corporation Commission in Case No. PUE-2004-00068 for any customer electing such option and subsequently returning to the local distribution company.

E. An aggregator electing to serve a group of electric customers and acting on behalf of each customer and electing the option offered through subsection B of this section shall do so on behalf of its total aggregated load.

F. A contract of an aggregator and a competitive service provider serving such qualified customers shall contain a clear and conspicuous caption: "Customer's Right to Exemption of Wires Charges," in bold face type of a minimum size of 10 points, disclosing any wires charges imposed by the local distribution company, including options to exempt such payment, and associated risks to exercise such options, including the inability to ever return to service of the local distribution company at capped rates.

G. The investor-owned local distribution company's notification to the customer advising of an enrollment request, as required by 20VAC5-312-80 I, for customers electing to waive the wires charges, shall in a clear and conspicuous manner, as approved by the staff of the State Corporation Commission, state that the customer will not be required to pay wires charges, but that the customer will not ever return to service of the local distribution company at capped rates.

H. The competitive service provider serving a customer that is not obligated to pay wires charges shall provide the investor-owned local distribution company 60 days notice prior to terminating service to such a customer.

I. The election to be exempt from any wires charges is available to the first 1,000 MW or 8.0% of the investor-owned electric local distribution company's prior year Virginia adjusted peak-load.

J. Such exemption provisions are enforceable until the earlier of July 1, 2007, or the termination of any imposed wires charges, while the inability to return to capped rate service remains indefinitely upon exercising this option.

Titles of Regulations: 20VAC5-312. Rules Governing Retail Access to Competitive Energy Services (amending 20VAC5-312-10, 20VAC5-312-20, 20VAC5-312-60, 20VAC5-312-80, 20VAC5-312-90; repealing 20VAC5-312-120).

20VAC5-313. Rules Governing Exemptions to Minimum Stay Requirements and Wires Charges (amending 20VAC5-313-10, 20VAC5-313-20; repealing 20VAC5-313-30).

Statutory Authority: §§ 12.1-13 and 56-576 of the Code of Virginia.

Effective Date: January 1, 2009.

Agency Contact: David Eichenlaub, Assistant Director, Economic and Finance Division, State Corporation Commission, P.O. Box 1197, Richmond, VA 23218, telephone (804) 371-9050, FAX (804) 371-9935, or email david.eichenlaub@scc.virginia.gov.

Summary:

Revisions have been made to these rules as they relate to electric energy services necessitated by the changes in the statutory requirements for the provision of retail access to electric energy services set forth in amendments by the Virginia General Assembly to the Virginia Electric Utility Restructuring Act (§ 56-576 et seq. of the Code of Virginia), renamed the Virginia Electric Utility Regulation Act. The revisions remove references to default service, modify the initiation of the reporting requirements for companies to begin with enrollment of customers under a retail access program, modify the customer information requirement on local distribution companies, modify the minimum stay requirement for electric customers, provide for an exception to the billing and payment rules for those companies offering an approved 100% renewable electric tariff to its retail customers, and eliminate the regulation governing competitive metering from 20VAC5-312. The changes to 20VAC5-313 eliminate provisions related to wires charges.

In response to comments filed by interested parties and the staff report filed by the commission’s staff, several revisions to the proposed version were made to (i) clarify how the minimum stay provisions of 20VAC5-312-80 Q will operate; (ii) reflect that consolidated billing is now permissive, not mandatory, and covered by filed utility tariffs; and (iii) add MCF, a gas usage term, to provisions previously only using the electric designations MW or kWh.

AT RICHMOND, NOVEMBER 26, 2008

COMMONWEALTH OF VIRGINIA

At the relation of the

STATE CORPORATION COMMISSION

CASE NO. PUE-2008-00061

Ex Parte: In the matter of revising the rules
of the State Corporation Commission governing
Retail Access to Competitive Energy Services

ORDER REVISING REGULATIONS

The Commission's Rules Governing Retail Access to Competitive Energy Services ("Retail Access Rules"), 20 VAC 5-312-10 et seq., were adopted in 2001^[1] and last revised in 2003.^[2] Additionally, the Rules Governing Exemptions to the Minimum Stay Requirements and Wires Charges, set forth in 20 VA 5-313-10 et seq., were adopted in 2006 as transitory regulations promulgated to be in addition to the existing Retail Access Rules.^[3]

On July 29, 2008, the Commission entered an Order For Notice of Proceeding To Consider Revisions to the Commission's Rules Governing Retail Access to Competitive Energy Services ("July 29, 2008 Order") to revise the Retail Access Rules in order to reflect statutory changes made to the Virginia Electric Utility Restructuring Act,^[4] §§ 56-576 et seq. of the Code of Virginia ("Code") by the Virginia General Assembly regarding retail access to electric energy services within the Commonwealth.^[5] The July 29, 2008 Order attached draft revisions ("Proposed Rules") prepared by the Commission Staff ("Staff"), directed that notice of the Proposed Rules be given to the public, and provided an opportunity for interested persons to file comments on, propose modifications and supplements to, and request a hearing on the Proposed Rules.

Pursuant to the July 29, 2008 Order, comments were due by September 22, 2008. The Commission received comments from Appalachian Power Company ("APCo"), Virginia Electric Cooperatives,^[6]Virginia Electric and Power Company ("Virginia Power"), and Columbia Gas of Virginia, Inc. ("CGV"). None of the parties filing comments requested a hearing on the proposed revisions. However, Virginia Power requested an opportunity to file reply comments on or before October 15, 2008, in order to address any issues in the comments filed by others or in the Staff Report scheduled to be filed on October 6, 2008. On October 3, 2008, Robert A. Vanderhye filed with the Commission a request that comments he had filed in another Commission proceeding^[7] be considered in this case, and that a hearing on the Proposed Rules be held by the Commission. Mr. Vanderhye requested that the hearing be scheduled after a decision has been reached in Case No. PUE-2008-00044, and another Commission proceeding,^[8] asserting that the decisions reached in these cases will have a bearing on any changes to the Retail Access Rules. The Staff filed a Report on October 6, 2008, as directed by July 29, 2008 Order, summarizing the comments filed by APCo, the Virginia Electric Cooperatives, Virginia Power, and CGV, and making further revisions to the Proposed Rules, where necessary, in response to the comments filed on September 22, 2008.^[9]

NOW THE COMMISSION, upon consideration of this matter, is of the opinion and finds that the regulations attached hereto should be adopted effective January 1, 2009.

In the revisions to the Code enacted under Chapters 888 and 933 of the 2007 Virginia Acts of Assembly, the General Assembly, inter alia, moved the expiration of capped rates to December 31, 2008, and limited the ability of most consumers to purchase electric generation service from competing suppliers thereafter. Residential retail consumers will have the ability to engage in a choice of competitive generation suppliers only if the incumbent electric utility does not offer an approved tariff for electric energy provided 100 percent from renewable energy. Large customers exceeding 5 MW in demand maintain the ability to shop among competitive suppliers, and nonresidential customers may seek to aggregate load up to the 5 MW threshold in order to use a competitive supplier. Accordingly, it is necessary for the Commission to revise the Retail Access Rules effective January 1, 2009, in order to have the Commission's rules and regulations properly tailored to the new regulatory paradigm prescribed by the Virginia General Assembly.

The July 29, 2008 Order provided Proposed Rules which were developed by the Staff to incorporate changes to the Retail Access Rules necessitated by the statutory changes described above. APCo, the Virginia Electric Cooperatives, Virginia Power, and CGV provided comments on the Staff's Proposed Rules, and proposed several modifications of their own, which, as will be discussed below, are adopted or rejected by this Order.

The Virginia Electric Cooperatives and Virginia Power each proposed modifications to 20 VAC 5-312-10, the "Applicability; definitions" section of the Retail Access Rules. The Virginia Electric Cooperatives suggest stating that the regulations do not apply to a utility that offers a 100% renewable energy tariff option and has no customers meeting the load threshold.^[10] We find that this modification is unnecessary. As drafted, the regulations attached hereto will operate so as to cover the various scenarios provided by the statute. As noted in the Staff Report, certain rules refer to "eligible customers" to recognize that specific regulations are not applicable to, for example, residential customers, if the Commission has approved a tariff for electric energy provided 100% from renewable energy.^[11] Virginia Power suggests that certain definitions be changed to reflect that they are only applicable to natural gas customers.^[12] We find that these proposed changes are unnecessary. For example, as noted in the Staff Report, while the 2007 statutory changes eliminated electric utilities' obligation to provide consolidated billing, the regulations have been revised to reflect that consolidated billing is no longer mandatory. ^[13] Thus, consistent with the natural gas utilities' present practice, the utilities' tariffs, as approved by the Commission, will determine billing options.

Virginia Power, CGV, and the Virginia Electric Cooperatives each proposed additional modifications to 20 VAC 5-312-20, the "General provisions" section of the Retail Access Rules. CGV suggested several technical corrections to this section, including the need for subsection N to use the gas measurement term "MCF" in addition to the electric terms MW or kWh. The Staff Report included these technical corrections in the revisions to the Proposed Rules, and we adopt them herein.

The Virginia Electric Cooperatives seek an addition to subsection F of 20 VAC 5-312-20 to reflect what they perceive as a statutory obligation under § 56‑577 A 5 of the Code for competitive suppliers that provide electricity supply service to individual retail customers to provide only 100 percent renewable energy, unless such customers can shop under § 56‑577 A 3 or A 4.^[14] Similarly, APCo requested as part of this rulemaking that the Commission affirm that Code § 56‑577 A 5 establishes that if a local distribution company offers an approved tariff for electric energy provided 100 percent from renewable energy, other competitive providers are prevented from offering all renewable energy products within that service area and may not offer a mix of 50 percent from renewable sources and 50 percent from traditional sources.^[15] We find it unnecessary to restate the statute in these rules or to address the interpretation requested by the Virginia Electric Cooperatives and APCo.

Virginia Power proposed several modifications to 20 VAC 5-312-20 on the basis that this rule applied only to natural gas local distribution companies going forward. For the same reasons discussed above, we find these proposed changes unnecessary. With regard to the reporting requirements in subsections M and N of 20 VAC 5-312-20, as set forth initially by the Staff in the Proposed Rules, the reporting requirement is activated "[u]pon enrollment of a customer to receive competitive supply service." We find this sufficient to address Virginia Power's concern that the reporting requirements will have little value given the very limited access to retail choice.^[16] Finally, as acknowledged in the Staff Report, 20 VAC 5‑312‑20 preserves the right of any electric or natural gas utility to request a waiver of any provision believed to be unwarranted or cause harm or hardship to such utility.^[17]

Virginia Power and the Virginia Electric Cooperatives each proposed additional modifications to 20 VAC 5-312-60, the "Customer information" section of the Retail Access Rules. Virginia Power asserts that it would be burdensome to continually update its mass list of eligible customers every time a competitive service provider requests a list.^[18] Virginia Power's proposed solution is to require electric local distribution companies to provide the mass list once annually.^[19] As revised by the Staff in the initial Proposed Rules, the original regulations have been amended to require the local distribution companies to update or replace their list of eligible customers annually. This annually updated list would be provided upon request of a competitive service provider. Hence, there is no burden placed upon local distribution companies to update their list every time a competitive service provider makes a request. The Staff Report notes that as revised, creation of the mass list is not necessary until a list is requested by a competitive service provider.^[20] We find that the revisions to this section set forth in the Proposed Rules by Staff adequately address this concern raised by Virginia Power.

The Virginia Electric Cooperatives proposed to define who "eligible customers" are in greater detail. We find this proposal to be unnecessary. Whether a customer is "eligible" or not is determined by the customer's class and size, and the renewable energy offerings by its incumbent provider, as stated in the Code.

Virginia Power, APCO, and the Virginia Electric Cooperatives each expressed concern regarding the revisions to 20 VAC 5-312-80 Q, as initially drafted by the Staff, regarding "minimum stay" obligations.^[21] In its Staff Report, the Staff acknowledged the potential for confusion in the revised language concerning the rules governing the minimum stay requirements and offered further clarification to those rules.^[22] As adopted herein, the 12-month minimum stay requirement applies to any electric customer with an annual peak demand of 500 kW or greater. This is the same threshold that existed in this regulation prior to this proceeding. Subsection Q is further revised to account for the statutory revisions regarding 5 MW and aggregated nonresidential retail customers set out in Code § 56‑577 requiring either a five-year notice or Commission permission to return to tariffed rates. The 12-month minimum stay period retained herein applies to returning 5 MW and aggregated nonresidential retail customers, as required by § 56-577 A 3 C of the Code. Likewise, retained from the current Retail Access Rules as set out in 20 VAC 5-313-20^[23] is the alternative for returning customers to pay market‑based rates in order to avoid the obligation of a minimum stay requirement.

Virginia Power also proposed in its comments an expansion of the minimum stay period from one year to five years for 5 MW or aggregated nonresidential retail customers.^[24] This proposal is based upon the hypothetical that if several large industrial customers return to service and leave within a year, then the utility may have started on construction of a new generation facility to meet those needs. According to Virginia Power, to allow customers with substantial electric energy requirements to jump on and off the system may do harm to customers who do not leave.^[25] We find nothing in the present enactments that necessitates an expansion of the minimum stay requirement from one to five years. The new provisions in § 56-577 requiring a five-year notice before a large or aggregated customer can return to the electric incumbent without Commission approval provides the electric incumbent and its non-shopping customers more protection than existed prior to these statutory changes. We therefore decline to adopt Virginia Power's proposed five-year minimum stay period.

CGV proposed to amend subsection F of 20 VAC 5-312-80 as it relates to customers currently receiving service from a competitive service provider. CGV's proposed modification would require the local distribution company to reject a provider enrollment submitted by a new shopping customer's provider unless it has received a timely cancellation from the present provider.^[26] As noted in the Staff Report, we have received complaints from customers whose desire to switch to a new competitive service provider has been hampered.^[27] The Staff asserts that the present provisions adequately address this issue concerning multiple enrollments, i.e., if two or more enrollments are received during the monthly enrollment period then the utility is to process the first and reject all others. However, when a new monthly enrollment period begins upon the next meter read, the customer is free to choose another competitive service provider.^[28] We agree with the Staff that a customer's right to choose a new provider should not be denied because the current provider has not submitted a cancellation to the local distribution company.

Virginia Power proposed that subsection E of 20 VAC 5-312-80 be further revised to be applicable to only natural gas customers.^[29] The Staff did not agree, but did note that a change was warranted, modifying the Proposed Rules, as attached to the Staff Report, to ensure that the regulation applies to only those with "eligible" customers.^[30] We find that the Staff adequately addresses this concern.

CGV suggested that provisions of 20 VAC 5-312-90, the "Billing and payment" section of the Retail Access Rules, be further modified to reflect the repeal of the statutory requirement to offer consolidated billing.^[31] Likewise, and consistent with its earlier approach, Virginia Power proposed to modify the regulation to have it apply to natural gas local distribution companies only.^[32] The Staff agreed with CGV that the statutory obligation to provide for consolidated billing has been removed.^[33] The language proposed by the Staff establishes that, consistent with the natural gas utilities' present practice, the utilities' tariff as approved by the Commission will determine billing options. We adopt the Staff's revisions to 20 VAC 5-312-90 A.

Virginia Power also proposed that a provision be added to this section which would require competitive service providers to support aggregating nonresidential retail customers to the extent necessary to comply with the petition and reporting requirements of § 56-577 A 4 of the Code.^[34] We find that we need not adopt such a regulation at this time. Section 56-577 A 4 b of the Code requires the Commission to impose reasonable periodic monitoring and reporting obligations in granting a petition to aggregate load. This should be sufficient to address any reporting requirements that might be addressed in a regulation. Furthermore, as § 56-577 A 4 of the Code permits certain customers to petition "for permission to aggregate or combine their demands . . . so as to become qualified to purchase electric energy from any supplier. . . ," the statute on its face does not require the participation of the competitive service provider in the petitioning process.

Finally, we deny Virginia Power's request for an opportunity to file reply comments, and the late-filed request for a hearing submitted by Robert A. Vanderhye,^[35] as unnecessary for interested persons to comment upon, and for the Commission to consider adoption of, the revised rules herein.

Accordingly, IT IS ORDERED THAT:

(1) The current Rules Governing Retail Access to Competitive Energy Services 20 VAC 5‑312‑10 et seq., and the Rules Governing Exemptions to the Minimum Stay Requirements and Wires Charges, 20 VAC 5-313-10 et seq., are hereby revised and adopted as attached to this Order, effective as of January 1, 2009.

(2) A copy of this Order with a copy of the rules adopted herein shall be forwarded to the Virginia Register of Regulations for publication.

(3) The request by Virginia Power for an opportunity to file reply comments is hereby denied.

(4) The late-filed request by Robert A. Vanderhye for a hearing on the revisions to the Retail Access Rules is hereby denied.

(5) There being nothing further to come before the Commission, this case shall be removed from the Commission's docket of active proceedings and the papers filed herein placed in the file for ended causes.

Commissioner Dimitri did not participate in this matter.

AN ATTESTED COPY hereof shall be sent by the Clerk of the Commission to: Charles E. Bayless, Esquire, Appalachian Power Company, 3 James Center, Suite 702, 1051 East Cary Street, Richmond, Virginia 23219; Samuel R. Brumberg, Esquire, LeClair Ryan, 4201 Dominion Boulevard, Suite 200, Glen Allen, Virginia 23060; M. Renae Carter, Esquire, Dominion Resources Services, Law Department, 120 Tredegar Street, P.O. Box 26532, Richmond, Virginia 23261-6532; James S. Copenhaver, Esquire, Columbia Gas of Virginia, 1809 Coyote Drive, Chester, Virginia 23836; Robert A. Vanderhye, 801 Ridge Drive, McLean, Virginia, 22101; C. Meade Browder, Jr., Senior Assistant Attorney General, Division of Consumer Counsel, Office of Attorney General, 900 East Main Street, 2nd Floor, Richmond, Virginia 23219; and the Commission's Office of General Counsel and Divisions of Energy Regulation and Economics and Finance.

^[1] Commonwealth of Virginia ex rel. State Corporation Commission, Ex Parte: In the matter of establishing rules for retail access, Case No. PUE-2001-00013, 2001 S.C.C. Ann. Rep. 536 (Final Order, June 19, 2001).

^[2] Commonwealth of Virginia, ex rel. State Corporation Commission, Ex Parte: In the matter concerning the aggregation of retail electric customers under the provisions of the Virginia Electric Utility Restructuring Act, Case No. PUE-2002-00174, 2003 S.C.C. Ann. Rep. 371 (Order Adopting Revised Regulations, April 9, 2003).

^[3] Commonwealth of Virginia ex rel. State Corporation Commission, Ex Parte: In the matter of establishing rules and regulations pursuant to the Virginia Electric Utility Restructuring Act for exemptions to minimum stay requirements and wires charges, Case No. PUE-2004-00068, 2006 S.C.C. Ann. Rep. 303 (Order on Motion and Adopting Rules and Regulations, January 4, 2006).

^[4] Title changed to Virginia Electric Utility Regulation Act pursuant to Chapter 883 of the 2008 Virginia Acts of Assembly.

^[5] See Chapters 888 and 933 of the 2007 Virginia Acts of Assembly.

^[6] Filing jointly the Virginia Electric Cooperatives are: A&N Electric Cooperative, BARC Electric Cooperative, Central Virginia Electric Cooperative, Community Electric Cooperative, Craig-Botetourt Electric Cooperative, Mecklenberg Electric Cooperative, Northern Neck Electric Cooperative, Prince George Electric Cooperative, Rappahannock Electric Cooperative, Shenandoah Valley Electric Cooperative, and Southside Electric Cooperative, and the Virginia, Maryland, & Delaware Association of Electric Cooperatives.

^[7] Application of Virginia Electric and Power Company d/b/a Dominion Virginia Power, For approval of its Renewable Energy Tariff, Case No. PUE-2008-00044.

^[8] Application of Appalachian Power Company, For approval of Renewable Power Rider, Case No. PUE-2008-00057.

^[9] The Staff Report notes the filing of the requests of Mr. Vanderhye on October 2, 2008, but neither addresses the comments referenced therein or the late-filed request for a hearing.

^[10] Virginia Electric Cooperatives Comments at 4, fn 6 (suggesting, "[i]f the local distribution company has an approved tariff for electric energy provided 100% from renewable energy pursuant to Va. Code § 56-577(A)(5), and no customers meeting the requirements of Va. Code § 56-577(A)(3) or (A)(4), then the provisions of this Chapter shall not apply.")

^[11] Staff Report at 5.

^[12] Virginia Power Comments at 5-6 (proposing changes to "Bill ready," "Consolidated billing," "Nonbilling party," and "Rate ready").

^[13] Staff Report at 8.

^[14] Virginia Electric Cooperatives Comments at 8.

^[15] APCo Comments at 2.

^[16] Virginia Power Comments at 7.

^[17] Staff Report at 5.

^[18] Virginia Power Comments at 7.

^[19] Id. at 8.

^[20] Staff Report at 7.

^[21] Virginia Power Comments at 10; APCo Comments at 1-2; Virginia Electric Cooperatives Comments at 8-9.

^[22] Staff Report at 6.

^[23] "Exemption to minimum stay provisions."

^[24] Virginia Power Comments at 11.

^[25] Id.

^[26] CGV Comments at 3.

^[27] Staff Report at 8.

^[28] Id. at 9.

^[29] Virginia Power Comments at 8.

^[30] Staff Report at 8.

^[31] CGV Comments at 3-4.

^[32] Virginia Power Comments at 13-14.

^[33] Staff Report at 8.

^[34] Virginia Power Comments at 15.

^[35] Mr. Vanderhye's request for a hearing on related issues in Case Nos. PUE-2008-00044 and PUE-2008-00057 was granted. Hearings in these two cases were held on November 12, 2008.

20VAC5-312-10. Applicability; definitions.

A. These regulations are promulgated pursuant to the provisions of the Virginia Electric Utility Restructuring Regulation Act (§ 56-576 et seq. of the Code of Virginia) and to the provisions of retail supply choice for natural gas customers, § 56-235.8 of the Code of Virginia. The provisions in this chapter apply to suppliers of electric and natural gas services including local distribution companies and competitive service providers, and govern the implementation of retail access to competitive energy services, to the extent permissible by statute, in the electricity and natural gas markets, including the conduct of market participants. The provisions in this chapter shall be effective January 1, 2009, and applicable to the implementation of full or phased-in retail access to competitive energy services in the service territory of each local distribution company.

B. The following terms when used in this chapter shall have the following meanings, unless the context clearly indicates otherwise:

"Affiliated competitive service provider" means a competitive service provider that is a separate legal entity that controls, is controlled by, or is under common control of, a local distribution company or its parent. For the purpose of this chapter, any unit or division created by a local distribution company for the purpose of acting as a competitive service provider shall be treated as an affiliated competitive service provider and shall be subject to the same provisions and regulations.

"Aggregator" means a person licensed by the State Corporation Commission that, as an agent or intermediary, (i) offers to purchase, or purchases, electricity or natural gas supply service, or both, or (ii) offers to arrange for, or arranges for, the purchase of electricity supply service or natural gas supply service, or both, for sale to, or on behalf of, two or more retail customers not controlled by or under common control with such person. The following activities shall not, in and of themselves, make a person an aggregator under this chapter: (i) furnishing legal services to two or more retail customers or competitive service providers; (ii) furnishing educational, informational, or analytical services to two or more retail customers, unless direct or indirect compensation for such services is paid by a competitive service provider supplying electricity or natural gas, or both; (iii) furnishing educational, informational, or analytical services to two or more competitive service providers; (iv) providing default service under § 56-585 of the Code of Virginia; (v) conducting business as a competitive service provider licensed under 20VAC5-312-40; and (vi) (v) engaging in actions of a retail customer, acting in common with one or more other such retail customers, to issue a request for proposal or to negotiate a purchase of electricity supply service or natural gas supply service, or both, for consumption by such retail customers.

"Billing party" means a person who renders a consolidated or separate bill directly to a retail customer for competitive energy services, or distribution services, or both.

"Bill-ready" means the consolidated billing practice in which the nonbilling party calculates each retail customer's billing charges for services provided and forwards such charges to the billing party for inclusion on the consolidated bill.

"Business day" means any calendar day or computer processing day in the Eastern United States time zone in which the general office of the applicable local distribution company is open for business with the public.

"Competitive energy service" means the retail sale of electricity supply service, natural gas supply service, or any other competitive service as provided by legislation and approved by the State Corporation Commission as part of retail access by an entity other than the local distribution company as a regulated utility. For the purpose of this chapter, competitive energy services include services provided to retail customers by aggregators.

"Competitive service provider' means a person, licensed by the State Corporation Commission, that sells or offers to sell a competitive energy service within the Commonwealth. This term includes affiliated competitive service providers, as defined above, but does not include a party that supplies electricity or natural gas, or both, exclusively for its own consumption or the consumption of one or more of its affiliates. For the purpose of this chapter, competitive service providers include aggregators.

"Competitive transition charge" means the wires charge, as provided by § 56-583 of the Code of Virginia, that is applicable to a retail customer that chooses to procure electricity supply service from a competitive service provider.

"Consolidated billing" means the rendering of a single bill to a retail customer that includes the billing charges of a competitive service provider and the billing charges of the local distribution company.

"Customer" means retail customer.

"Distribution service" means the delivery of electricity or natural gas, or both, through the distribution facilities of the local distribution company to a retail customer.

"Electricity supply service" means the generation of electricity, or when provided together, the generation of electricity and its transmission to the distribution facilities of the local distribution company on behalf of a retail customer.

"Electronic Data Interchange" (EDI) means computer-to-computer exchange of business information using common standards for high volume electronic transactions.

"Local Distribution Company" means an entity regulated by the State Corporation Commission that owns or controls the distribution facilities required for the transportation and delivery of electricity or natural gas to the retail customer.

"Minimum stay period" means the minimum period of time a customer who requests electricity supply service from the local distribution company, pursuant to § 56-582 D §§ 56-577 A 3 c, 56-577 C 1, and 56-582 D of the Code of Virginia, after a period of receiving electricity supply service from a competitive service provider, is required to use such service from the local distribution company.

"Natural gas supply service" means the procurement of natural gas, or when provided together, the procurement of natural gas and its transportation to the distribution facilities of a local distribution company on behalf of a retail customer.

"Nonbilling party" means a person who provides retail customer billing information for competitive energy services or regulated service to the billing party for the purpose of consolidated billing.

"Person" means any individual, corporation, partnership, association, company, business, trust, joint venture, or other private legal entity, and the Commonwealth or any city, county, town, authority or other political subdivision of the Commonwealth.

"Price-to-compare" means the portion of the electric local distribution company's regulated rate applicable to electricity supply service less the competitive transition charge rate or the portion of the natural gas local distribution company's regulated rate applicable to natural gas supply service.

"Rate-ready" means the consolidated billing practice in which the nonbilling party provides rate information to the billing party to calculate and include the nonbilling party's charges on the consolidated bill.

"Residential customer" means any person receiving retail distribution service under a residential tariff of the local distribution company.

"Retail access" means the opportunity for a retail customer in the Commonwealth to purchase a competitive energy service from a licensed competitive service provider seeking to sell such services to that customer.

"Retail customer" means any person who purchases retail electricity or natural gas for his or her own consumption at one or more metering points or nonmetered points of delivery located within the Commonwealth.

"Separate billing" means the rendering of separate bills to a retail customer for the billing charges of a competitive service provider and the billing charges of the local distribution company.

"Transmission provider" means an entity regulated by the Federal Energy Regulatory Commission that owns or operates, or both, the transmission facilities required for the delivery of electricity or natural gas to the local distribution company or retail customer.

"Virginia Electronic Data Transfer Working Group" (VAEDT) means the group of representatives from electric and natural gas local distribution companies, competitive service providers, the staff of the State Corporation Commission, and the Office of Attorney General whose objective is to formulate guidelines and practices for the electronic exchange of information necessitated by retail access.

20VAC5-312-20. General provisions.

A. A request for a waiver of any of the provisions in this chapter shall be considered by the State Corporation Commission on a case-by-case basis, and may be granted upon such terms and conditions as the State Corporation Commission may impose.

B. The provisions of this chapter may be enforced by the State Corporation Commission by any means authorized under applicable law or regulation. Enforcement actions may include, without limitation, the refusal to issue any license for which application has been made, and the revocation or suspension of any license previously granted. The provisions of this chapter shall not be deemed to preclude a person aggrieved by a violation of these regulations from pursuing any civil relief that may be available under state or federal law, including, without limitation, private actions for damages or other equitable relief.

C. The provisions of this chapter shall not be deemed to prohibit the local distribution company, in emergency situations, from taking actions it is otherwise authorized to take that are necessary to ensure public safety and reliability of the distribution system. The State Corporation Commission, upon a claim of inappropriate action or its own motion, may investigate and take such corrective actions as may be appropriate.

D. The State Corporation Commission maintains the right to inspect the books, papers, records and documents, and to require reports and statements, of a competitive service provider as required to verify qualifications to conduct business within the Commonwealth, to support affiliate transactions, to investigate allegations of violations of this chapter, or to resolve a complaint filed against a competitive service provider. Every competitive service provider licensed pursuant to this chapter shall establish and maintain records identifying persons or entities performing promotional or marketing activities on behalf of or in conjunction with such competitive service provider.

E. Absent the designation of a default service provider as determined by the State Corporation Commission pursuant to § 56-585 of the Code of Virginia, the The local distribution company shall provide, pursuant to the prices, terms, and conditions of its tariffs approved by the State Corporation Commission, service to all customers that do not select a competitive service provider and to customers that chose a competitive service provider but whose service is terminated for any reason.

F. A competitive service provider selling electricity supply service or natural gas supply service, or both, at retail shall:

1. Procure sufficient electric generation and transmission service or sufficient natural gas supply and delivery capability, or both, to serve the requirements of its firm customers.

2. Abide by any applicable regulation or procedure of any institution charged with ensuring the reliability of the electric or natural gas systems, including the State Corporation Commission, the North American Electric Reliability Council Corporation, and the Federal Energy Regulatory Commission, or any successor agencies thereto.

3. Comply with any obligations that the State Corporation Commission may impose to ensure access to sufficient availability of capacity.

G. The local distribution company and a competitive service provider shall not:

1. Suggest that the services provided by the local distribution company are of any different quality when competitive energy services are purchased from a particular competitive service provider; or

2. Suggest that the competitive energy services provided by a competitive service provider are being provided by the local distribution company rather than the competitive service provider.

H. The local distribution company shall conduct its forecasting, scheduling, balancing, and settlement activities in a nondiscriminatory and reasonably transparent manner.

I. The local distribution company or competitive service provider shall bear the responsibility for metering as provided by legislation and implemented by the State Corporation Commission.

J. The local distribution company and a competitive service provider, shall coordinate their customer communication activities with the State Corporation Commission's statewide consumer education campaign.

K. J. The local distribution company and a competitive service provider shall adhere to standard practices for exchanging data and information in an electronic medium as specified by the VAEDT and filed with the State Corporation Commission or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission. In the event the parties agree to initially use a means other than those specified by VAEDT or the local distribution company's tariff, then the competitive service provider shall file a plan with the State Corporation Commission's Division of Economics and Finance to implement VAEDT or tariff approved standards within 180 days of the initial retail offering.

L. K. The local distribution company and a competitive service provider that is responsible for exchanging customer information electronically with such local distribution company shall, except as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission, successfully complete EDI testing and receive certification for all EDI transactions, as outlined in the VAEDT EDI Test Plan, prior to actively enrolling customers, except as permitted by subsection K of this section.

M. L. A competitive service provider offering billing service that requires the direct delivery of a bill to a customer and that requires the electronic exchange of data with the local distribution company shall furnish, prior to enrolling the customer, a sample bill produced from the data exchanged in the EDI certification process, or comparable electronic data exchange process, as described in subsection L of this section, or a sample bill produced similarly elsewhere, to the State Corporation Commission's Division of Energy Regulation and Division of Economics and Finance.

N. The M. Upon enrollment of a customer to receive competitive supply service, the local distribution company shall file with the State Corporation Commission's Division of Energy Regulation and Division of Economics and Finance a monthly report which shall, at a minimum, include all cancellation requests alleging a customer was enrolled without authorization. Such reports shall include: (i) the approximate date of the enrollment; (ii) the identity of the competitive service provider involved; (iii) the name and address of the customer that cancelled such enrollment; and (iv) if readily available, a brief statement regarding the customer's explanation for the cancellation. Such reports shall be reviewed by commission staff and regarded as confidential unless and until the State Corporation Commission orders otherwise.

O. The N. Upon enrollment of a customer to receive competitive supply service, the local distribution company shall file with the State Corporation Commission's Division of Economics and Finance a quarterly report providing a detailed breakdown of residential and nonresidential customer switching activity. Such reports shall include, for the local distribution company, the total number of customers and corresponding amount of load eligible to switch; and, for each competitive service provider, the total number of customers and corresponding amount of load served. The amount of load shall be measured in MW [ , Mcf, ] or dekatherm capacity of peak load contribution and in kWh [ , Mcf, ] or therms of associated energy. Such reports shall be reviewed by commission staff and information specific to individual competitive service providers shall be regarded as confidential unless and until the State Corporation Commission orders otherwise.

P. O. By March 31 of each year, the provider of electricity supply service shall report to its customers and file a report with the State Corporation Commission stating to the extent feasible, fuel mix and emissions data for the prior calendar year. If such data is unavailable, the provider of electricity supply service shall file a report with the State Corporation Commission stating why it is not feasible to submit any portion of such data.

Q. P. A competitive service provider shall file a report with the State Corporation Commission by March 31 of each year to update all information required in the original application for licensure. A $100 administrative fee payable to the State Corporation Commission shall accompany this report.

R. Q. A competitive service provider shall inform the State Corporation Commission within 30 days of the following: (i) any change in its name, address and telephone numbers; (ii) any change in information regarding its affiliate status with the local distribution company; (iii) any changes to information provided pursuant to 20VAC5-312-40 A 13; and (iv) any changes to information provided pursuant to 20VAC5-312-40 A 15.

S. R. If a filing with the State Corporation Commission, made pursuant to this chapter, contains information that the local distribution company or a competitive service provider claims to be confidential, the filing may be made under seal provided it is accompanied by both a motion for protective order or other confidential treatment and an additional five copies of a redacted version of the filing to be available for public disclosure. Unredacted filings containing the confidential information shall be maintained under seal unless the State Corporation Commission orders otherwise, except that such filings shall be immediately available to the commission staff for internal use at the commission. Filings containing confidential or redacted information shall be so stated on the cover of the filing, and the precise portions of the filing containing such confidential or redacted information, including supporting material, shall be clearly marked within the filing.

20VAC5-312-60. Customer information.

A. A competitive service provider shall adequately safeguard all customer information and shall not disclose such information unless the customer authorizes disclosure or unless the information to be disclosed is already in the public domain. This provision, however, shall not restrict the disclosure of credit and payment information as currently permitted by federal and state statutes.

B. The local distribution company shall provide, upon the request of a competitive service provider, a mass list of eligible customers. A competitive service provider shall adequately safeguard all of the information included on the mass list and shall not disclose such information unless the customer authorizes disclosure or unless the information to be disclosed is already in the public domain.

1. The mass list shall include the following customer information: (i) customer name; (ii) service address; (iii) billing address; (iv) either an account number, a service delivery point, or universal identifier, as applicable; (v) meter reading date or cycle; (vi) wholesale delivery point, if applicable; (vii) rate class and subclass or rider, as applicable; (viii) load profile reference category, if not based on rate class; and (ix) up to twelve months of cumulative historic energy usage and annual peak demand information as available.

2. Prior to disclosing any information on the mass list, the local distribution company shall provide each customer the opportunity to have the information itemized in subdivision 1 of this subsection withheld, in total, from the mass list.

3. The local distribution company shall make the mass list available two months prior to implementation of full or phased-in retail access and shall update or replace the list every six months thereafter annually. Prior to each update, each customer shall be provided an opportunity to reverse the prior decision regarding the disclosure of the information included on the mass list.

4. The local distribution company shall prepare and make available the mass list by means specified by the VAEDT or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission.

C. A competitive service provider choosing to utilize the mass list shall use the most recent mass list made available by the local distribution company.

D. A competitive service provider shall obtain customer authorization prior to requesting any customer usage information not included on the mass list from the local distribution company. A competitive service provider shall provide evidence of such authorization, in the manner required to demonstrate authorization to enroll a customer in 20VAC5-312-80 B, upon request by the customer or the State Corporation Commission.

20VAC5-312-80. Enrollment and switching.

A. A competitive service provider may offer to enroll a customer upon: (i) receiving a license from the State Corporation Commission; (ii) receiving EDI certification as required from the VAEDT or completing other data exchange testing requirements as provided by the local distribution company's tariff approved by the State Corporation Commission, including the subsequent provision of a sample bill as required by 20VAC5-312-20 M L ; and (iii) completing registration with the local distribution company.

B. A competitive service provider may enroll, or modify the services provided to, a customer only after the customer has affirmatively authorized such enrollment or modification. A competitive service provider shall maintain adequate records allowing it to verify a customer's enrollment authorization. Examples of adequate records of enrollment authorization include: (i) a written contract signed by the customer; (ii) a written statement by an independent third party that witnessed or heard the customer's verbal commitments; (iii) a recording of the customer's verbal commitment; or (iv) electronic data exchange, including the Internet, provided that the competitive service provider can show that the electronic transmittal of a customer's authorization originated with the customer. Such authorization records shall contain the customer's name and address; the date the authorization was obtained; the name of the product, pricing plan, or service that is being subscribed; and acknowledgment of any switching fees, minimum contract terms or usage requirements, or cancellation fees. Such authorization records shall be retained for at least 12 months after enrollment and shall be provided within five business days upon request by the customer or the State Corporation Commission.

C. A competitive service provider shall send a written contract to a customer prior to, or contemporaneously with, sending the enrollment request to the local distribution company.

D. Upon a customer's request, a competitive service provider may re-enroll such customer at a new address under the existing contract, without acquiring new authorization records, if the competitive service provider is licensed to provide service to the customer's new address and is registered with the local distribution company.

E. The local distribution company shall advise [ a customer eligible customers ] initiating new service of the customer's right and opportunity to choose a competitive service provider.

F. In the event that multiple enrollment requests are submitted regarding the same customer within the same enrollment period, the local distribution company shall process the first one submitted and reject all others for the same enrollment period.

G. Except as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission, the competitive service provider shall submit an enrollment request to the local distribution company at least 15 days prior to the customer's next scheduled meter reading date for service to be effective on that meter reading date. For an enrollment request received less than 15 days prior to the customer's next scheduled meter reading date, service shall be effective on the customer's subsequent meter reading date, except as provided by subsection H of this section.

H. A competitive service provider may request, pursuant to the local distribution company's tariff, a special meter reading, in which case the enrollment may become effective on the date of the special meter reading. The local distribution company shall perform the requested special meter reading as promptly as working conditions permit.

I. Upon receipt of an enrollment request from a competitive service provider, the local distribution company shall, normally within one business day of receipt of such notice, mail notification to the customer advising of the enrollment request, the approximate date that the competitive service provider's service commences, and the caption and statement as to cancellation required by 20VAC5-312-70 C 8. The customer shall have until the close of business on the tenth day following the mailing of such notification to advise the local distribution company to cancel such enrollment without penalty.

J. In the event a competitive service provider receives a cancellation request within the cancellation period provided by 20VAC5-312-70 C 8 or 20VAC5-312-70 D, it shall notify, by any means specified by the VAEDT or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission, the local distribution company of the customer's cancellation in order to terminate the enrollment process.

K. In the event the local distribution company receives notice of a cancellation request from a competitive service provider or a customer within the cancellation period provided by 20VAC5-312-70 C 8 or 20VAC5-312-70 D, the local distribution company shall terminate the enrollment process by any means specified by the VAEDT or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission.

L. In the event a customer terminates a contract beyond the cancellation period as provided by 20VAC5-312-70 C 8 and 20VAC5-312-70 D, the competitive service provider or the local distribution company shall provide notice of termination to the other party by any means specified by the VAEDT or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission.

M. If a competitive service provider terminates an individual contract for any reason, including expiration of the contract, the competitive service provider shall provide notice of termination to the local distribution company by any means specified by the VAEDT or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission and also shall send written notification of such termination, for reasons other than nonpayment, to the customer at least 30 days prior to the date that service to the customer is scheduled to terminate. A competitive service provider shall send written notification to the customer for termination for nonpayment at least 15 days prior to the date that service to such customer is scheduled to terminate.

N. If the local distribution company is notified by a competitive service provider that the competitive service provider will terminate service to a customer, the local distribution company shall respond to the competitive service provider by any means specified by the VAEDT or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission to acknowledge (i) receipt of the competitive service provider's notice, and (ii) the date that the competitive service provider's service to the customer is scheduled to terminate. Additionally, the local distribution company shall send written notification to the customer, normally within five business days, that it was so informed and describe the customer's opportunity to select a new supplier. Absent the designation of a default service provider as determined by the State Corporation Commission pursuant to § 56-585 of the Code of Virginia, the The local distribution company shall inform the affected customer that if the customer does not select another competitive service provider, the local distribution company shall provide the customer's electricity supply service or natural gas supply service pursuant to the prices, terms, and conditions of its tariffs approved by the State Corporation Commission.

O. If a competitive service provider decides to terminate service to a customer class or to abandon service within the Commonwealth, the competitive service provider shall provide at least 60 days advanced written notice to the local distribution company, to the affected customers, and to the State Corporation Commission.

P. If the local distribution company issues a final bill to a customer, the local distribution company shall notify, by any means specified by the VAEDT or as otherwise provided in the local distribution company's tariff approved by the State Corporation Commission, the customer's competitive service provider.

Q. The [ If the local distribution company does not offer an approved tariff for electric energy provided 100% from renewable energy pursuant to § 56-577 A 5 of the Code of Virginia, the The ] local distribution company may require a 12-month minimum stay period for electricity customers with an annual peak demand of 500 kW or greater. [ Electricity If the local distribution company does not offer an approved tariff for electric energy provided 100% from renewable energy pursuant to § 56-577 A 5 of the Code of Virginia, such electricity ] customers that return to capped rate service provided by the local distribution company as a result of a competitive service provider's abandonment of service in the Commonwealth may choose another competitive service provider at any time without the requirement to remain for the minimum stay period of 12 months. For [ individual or aggregated ] customers greater than 5 MW and pursuant to § 56-577 A 3 c of the Code of Virginia [ , an such ] electricity [ customer customers ] choosing to purchase supply service from a licensed supplier after December 31, 2008, may return to service provided by the local distribution company upon five years' written notice and at the prices, terms, and conditions of the tariffs approved by the State Corporation Commission. Alternatively, such [ an ] electricity [ customer customers ] may seek an exemption from the State Corporation Commission to provide less than five years' notice and, if such exemption is granted, return to service provided by the local distribution company at prices based on market-based costs pursuant to § 56-577 A 3 d [ of the Code of Virginia ].

R. The local distribution company may, upon a proper showing with evidence acquired by actual experience, apply for approval from the State Corporation Commission to implement alternative minimum stay period requirements. If the applicant proposes to lower the applicability limit below 500 kW, such application shall include at a minimum, the detailed information prescribed by the State Corporation Commission in the text of its Final Order in Case No. PUE010296, or as may be revised in a subsequent order.

S. The local distribution company electing to implement a minimum-stay period in conformance with this chapter shall notify, in writing, applicable customers at least 30 days in advance of such implementation date and within each subsequent notification letter as required by 20VAC5-312-80 I. Electricity customers who have selected a competitive service provider prior to the local distribution company's notice of implementing a minimum-stay period will not be subject to the minimum stay period until such time as the customer renews an existing contract or chooses a new competitive service provider.

20VAC5-312-90. Billing and payment.

A. A competitive service provider [ shall may ] offer separate billing service or consolidated billing service, where either the local distribution company or the competitive service provider would be the billing party, to prospective customers pursuant to § 56-581.1 of the Code of Virginia and the local distribution company's tariff approved by the State Corporation Commission. Where a competitive service provider would be the billing party, prior to an initial offering of consolidated billing service to customers within the service territory of each local distribution company, and after certification as required by 20VAC5-312-20 L K, the competitive service provider shall abide by the following requirements:

1. The competitive service provider shall provide written notice, at least 30 days in advance, to the local distribution company and to the State Corporation Commission's Division of Energy Regulation and Division of Economics and Finance. The written notification to the Division of Energy Regulation and the Division of Economics and Finance shall include:

a. The anticipated date of the initial consolidated billing service offering in each local distribution company service territory in which the service will be offered.

b. Any changes in information provided by the competitive service provider in its original license application pursuant to 20VAC5-312-40 A that have not been reported to the State Corporation Commission pursuant to 20VAC5-312-20 Q P and 20VAC5-312-20 R Q.

c. The expected maximum market penetration for the provision of consolidated billing service to electricity customers during the following 12 months, including the estimated number of customers and associated annual consumption by customer type or load profile classification.

d. A representation that the electric competitive service provider has undertaken the necessary preliminary coordination efforts with tax officials of each potentially affected locality regarding the competitive service provider's obligation to collect and remit local consumption taxes and local utility consumer taxes.

2. The competitive service provider shall establish such financial security as the State Corporation Commission may require for such competitive service provider's estimated liability associated with the collection and remittance of state, local, and special regulatory consumption taxes and local utility consumer taxes.

B. Subject to the exemptions applicable to municipal electric utilities and utility consumer service cooperatives set forth in § 56-581.1 J of the Code of Virginia, a competitive service provider shall coordinate the provision of the customer-selected billing service with the local distribution company by any means specified by VAEDT or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission.

C. Consolidated billing, except as otherwise arranged through contractual agreement between the local distribution company and a competitive service provider or as otherwise provided by the local distribution company's tariff approved by the State Corporation Commission, shall:

1. Be performed under a "bill-ready" protocol.

2. Not require the billing party to purchase the accounts receivable of the nonbilling party.

3. Not require the electric local distribution company to include natural gas competitive energy service charges on a consolidated bill or the natural gas local distribution company to include electric competitive energy service charges on a consolidated bill.

4. Not require the local distribution company to exchange billing information for any customer account with more than one competitive service provider for the same billing period.

5. Comply with the local distribution company's normal billing and credit cycle requirements for distribution service.

D. In the event a competitive service provider collects security deposits or prepayments, such funds shall be held in escrow by a third party in Virginia, and the competitive service provider shall provide to the State Corporation Commission the name and address of the entity holding such deposits or prepayments.

E. A competitive service provider requiring a deposit or prepayment from a customer shall limit the amount of the deposit or prepayment to the equivalent of a customer's estimated liability for no more than three months' usage of services from the competitive service provider by that customer.

F. Customer deposits held or collected by a local distribution company shall be for only those services provided by the local distribution company. Any deposit held in excess of this amount shall be promptly credited or refunded to the customer. The local distribution company may, upon a customer's return to regulated electricity supply service or natural gas supply service, collect that portion of a customer deposit as permitted by the local distribution company's tariffs and 20VAC5-10-20.

G. Terms and conditions concerning customer disconnection for nonpayment of regulated service charges shall be set forth in each local distribution company's tariff approved by the State Corporation Commission. A customer may not be disconnected for nonpayment of unregulated service charges. If a customer receives consolidated billing service and a competitive service provider is the billing party, the local distribution company shall advise the customer directly of any pending disconnection action for nonpayment through 10 days' notice by mail, separate from the consolidated bill. Such notice shall clearly identify the amount that must be paid and the date by which such amount must be received by, and also provide instructions for direct payment to, the local distribution company to avoid disconnection.

H. The provision of consolidated billing service shall conform to the following requirements:

1. The billing party shall apply a customer's partial payment of a consolidated bill as designated by the customer, or, in the absence of a customer's designation, to charges in the following order: (i) to regulated service arrearages owed the local distribution company; (ii) to competitive energy service arrearages owed the competitive service provider; (iii) to regulated service current charges of the local distribution company; (iv) to competitive energy service current charges of the competitive service provider; and (v) to other charges.

2. Collections of state and local consumption taxes and local utility consumer taxes shall be remitted as required by law. The person responsible for collecting and remitting such taxes shall:

a. Submit simultaneously, on or before the last day of the succeeding month of collection to the State Corporation Commission's Division of Public Service Taxation, the payment of the preceding month's state and special regulatory consumption taxes and associated Electric Utility or Natural Gas Consumption Tax Monthly Report.

b. Submit simultaneously, in accordance with the Code of Virginia and local ordinance, to each local government in whose jurisdiction the taxes have been collected, the payment of local consumption taxes and local utility consumer taxes and associated tax remittance reports.

I. The local distribution company and a competitive service provider shall comply with the following minimum billing information standards applicable to all customer bills:

1. Sufficient information shall be provided or referenced on the bill so that a customer can understand and calculate the billing charges.

2. Charges for regulated services and unregulated services shall be clearly distinguished.

3. Standard terminology shall be employed and charges shall be categorized for the following key bill components, as applicable: (i) distribution service; (ii) competitive transition charge; (iii) electricity supply service or natural gas supply service; (iv) (iii) state and local consumption tax; and (v) (iv) local (or locality name) utility tax. The bill may provide further detail of each of these key components as appropriate.

4. Nonroutine charges and fees shall be itemized including late payment charges and deposit collections.

5. The total bill amount due and date by which payment must be received to avoid late payment charges shall be clearly identified.

6. The 24-hour toll-free telephone number of the local distribution company for service emergencies shall be clearly identified.

7. In the event a disconnection notice for nonpayment is included on a customer bill issued by the local distribution company, the notice shall appear on the first page of the bill and be emphasized in a manner that draws immediate attention to such notice. The notice shall clearly identify the amount that must be paid and the date by which such amount must be paid to avoid disconnection.

8. The following additional information shall be provided on customer bills to the extent applicable:

a. Customer name, service address, billing address, account number, rate schedule identifier, and meter identification number.

b. Billing party name, payment address, and toll-free telephone number for customer inquiries and complaints.

c. For consolidated bills, nonbilling party name and toll-free telephone number for customer inquiries and complaints and the customer's local distribution company account number.

d. Bill issue date and notice of change in rates.

e. Previous and current meter readings and dates of such meter readings or metering period days, current period energy consumption, meter reading unit conversion factor, billing-demand information, and "estimated" indicator for non-actual meter reads.

f. Previous bill amount or account balance, payments received since previous billing, balance forward, current charges, total amount due or current account balance, and payment plan information.

g. For consolidated bills, billing party and nonbilling party elements as specified in subdivision 8 f of this subsection.

J. The local distribution company shall comply with the following additional billing information standards applicable to the bills of customers that are not subject to demand-based billing charges and that purchase regulated electricity supply service or regulated natural gas supply service from the local distribution company:

1. The local distribution company shall employ standard terminology and categorize charges for the following key billing components: (i) distribution service; (ii) electricity supply service or natural gas supply service; (iii) state and local consumption tax; and (iv) local (or locality name) utility tax. Brief explanations of distribution service and electricity supply service or natural gas supply service shall be presented on the bill. Such explanations shall convey that distribution service is a regulated service that must be purchased from the local distribution company and that electricity supply service or natural gas supply service may be purchased from the competitive market but, if applicable, may result in a competitive transition charge;

2. The local distribution company shall provide on customer bills a customer's monthly energy consumption, numerically or graphically, for the previous 12 months; and

3. The investor-owned electric local distribution company shall provide on each bill a "price-to-compare" value, stated in cents per kilowatt-hour, representing the cost of regulated electricity supply service [ less the competitive transition charge, if any, ] that would be applicable if such service were purchased from a competitive service provider. The appropriate use and limitations of such "price-to-compare" value shall be stated on the bill.

K. The local distribution company shall develop and implement a program to provide "price-to-compare" information and assistance to customers. [ The local distribution company shall provide a program plan to the State Corporation Commission's Division of Energy Regulation at least 90 days prior to the implementation of full or phased-in retail access. ] Such a program shall ensure that customers will be provided meaningful information for evaluating competitive offers of electricity supply service or natural gas supply service. At a minimum, the program shall include a mechanism for providing, or making readily accessible, customer-specific "price-to-compare" information, including explanations of its appropriate use and limitations and, if applicable, the relationship between the regulated electricity supply charge, the competitive transition charge, and the "price-to-compare.".

L. The billing party shall, except as otherwise arranged through contractual agreement with the nonbilling party, provide sufficient space on a consolidated bill to accommodate the local distribution company's customer account number and the nonbilling party's name and toll-free telephone number, previous bill amount or account balance, payments applied since the previous billing, balance forward, total current charges, total amount due or current account balance, six additional numeric fields to detail current charges, and 240 additional text characters.

M. If the local distribution company, as the billing party, provides consolidated billing service to a customer and continues to be the customer's billing party after the customer's service with a competitive service provider terminates, the local distribution company shall, except as otherwise arranged through contractual agreement with such competitive service provider, continue to track and bill customer account arrearages owed to such competitive service provider for two billing cycles after service has terminated. The bill shall list, at a minimum, the name, toll-free telephone number, and balance due for each former competitive service provider.

N. If the current charges of the nonbilling party are not included on the consolidated bill issued by the billing party, the bill shall note that such charges are not included.

O. If the current charges of the nonbilling party are not included on the consolidated bill issued by the billing party due to causes attributable to the nonbilling party, the charges shall be billed in the following month unless the two parties mutually agree to other arrangements.

P. If the current charges of the nonbilling party are not included on the consolidated bill issued by the billing party due to causes attributable to the billing party, the bill shall be cancelled and reissued to include such charges unless the two parties mutually agree to other arrangements.

Q. The local distribution company or a competitive service provider shall report any significant deficiency regarding the timely issuance, accuracy, or completeness of customer bills to the State Corporation Commission's Division of Energy Regulation as soon as practicable. Such reports shall detail the circumstances surrounding the deficiency and the planned corrective actions.

R. If the local distribution company has an approved tariff for electric energy provided 100% from renewable energy pursuant to § 56-577 A 5 of the Code of Virginia, the provisions of [ subsections A through Q of ] this section shall not be applicable. Instead, an electric distribution company and an electric competitive service provider shall only offer separate billing service where both would be the billing party for the respective services to prospective customers pursuant to the local distribution company's tariff approved by the State Corporation Commission.

20VAC5-312-120. Electricity metering. (Repealed.)

A. If the local distribution company provides interval metering as a customer's basic metering service in accordance with its applicable tariff, interval metering of that customer's load shall continue to be required if the customer purchases electricity supply service from a competitive service provider. Unless other arrangements are agreed upon between the local distribution company and the customer, the local distribution company may remove the interval meter if the customer's load deteriorates below previously established interval metering thresholds.

B. Upon a customer's request, the local distribution company shall provide interval metering service to the customer at the net incremental cost above the basic metering service provided by the local distribution company. The local distribution company shall reply to the customer in writing within five business days of the request for interval metering service, acknowledging receipt of the request, explaining the process, and identifying the prerequisites for commencing and completing the work. Once the customer has completed the applicable prerequisites, the local distribution company shall complete the work within 45 calendar days, or as promptly as working conditions permit.

C. The local distribution company shall offer each of the following interval metering service options to customers or their authorized competitive service provider to access unedited interval data from the local distribution company's interval metering equipment and consistent with the local distribution company's communication protocol: (i) read-only electronic access to the interval billing meter, (ii) receipt of a stream of data pulses proportional to energy usage, and (iii) both of the foregoing.

D. As a component of interval metering service, the local distribution company shall read interval meters at a frequency in accordance with its applicable terms and conditions and shall store interval meter data at intervals compatible with wholesale load settlement requirements. Interval meter data may be estimated on occasion as necessary. The local distribution company shall make available to customers or their authorized competitive service provider 12 months of historical edited interval data through electronic communication medium unless otherwise requested by mail, as mutually agreed.

E. The local distribution company shall respond to requests from customers or their authorized competitive service provider to evaluate special metering functionality that may not be provided normally under the local distribution company's tariff but that is determined by the local distribution company to be within the capability of its interval metering equipment. The local distribution company shall acknowledge receipt of the requests in writing within five business days, indicating that the net incremental cost, prerequisites and process for providing the special metering functionality will be submitted in writing within 30 days. Once the customer has completed the applicable prerequisites, the local distribution company shall provide the special metering functionality within 45 calendar days, or as promptly as working conditions permit.

F. The local distribution company shall install and maintain meters owned by large industrial customers and large commercial customers if the meter is determined to be consistent with the local distribution company's billing and metering systems and communication protocol. Ownership shall apply to the meter as defined by a line of demarcation specified in the local distribution company tariff approved by the State Corporation Commission.

G. Upon a customer's request to own a meter in accordance with subsection F of this section, the local distribution company shall reply to the customer in writing within 10 days of the request, acknowledging receipt of the request, explaining the process, and identifying the prerequisites for commencing and completing the work. The local distribution company shall also explain its policies with respect to replacement of defective meters. Once the customer has completed the applicable prerequisites, the local distribution company shall complete the work within 45 days, or as promptly as working conditions permit.

H. Upon the installation of a meter owned by a customer in accordance with subsections F and G of this section, the local distribution company shall continue to have full access to the meter and shall continue to perform its normal obligations including but not limited to testing, replacement, customer accounting, reading and data management. In accordance with subsection C of this section, the local distribution company shall provide customers or their authorized competitive service provider with read-only electronic access to the meter.

20VAC5-313-10. Applicability.

A. The existing Rules Governing Retail Access to Competitive Energy Services (20VAC5-312) remain enforceable unless further qualified by the following additional rules.

B. These transitory regulations are promulgated pursuant to the amended provisions of the Virginia Electric Utility Restructuring Act (§§ 56-577 E and 56-583 of the Code of Virginia). This chapter applies to suppliers of electric services including investor-owned local distribution companies and competitive service providers, and are in addition to the existing rules of 20VAC5-312. The provisions in this chapter shall be applicable to the provision of generation service to the qualifying customers electing exemption to the current minimum stay provisions or to payment of the current wires charges. Rules applicable to the minimum stay exemption program shall remain in force until the termination of capped rates as provided under statute or State Corporation Commission order. Rules applicable to the offering of the wires charges exemption program shall remain in force until the earlier of July 1, 2007, or the termination of any wires charges.

[ 20VAC5-313-20. Exemption to minimum stay provisions.

A. This section applies to an investor-owned electric local distribution company imposing minimum stay provisions on certain customers as applicable under 20VAC5-312-80 Q and 20VAC5-312-80 R and to competitive service providers serving such customers.

B. An investor-owned electric local distribution company shall offer any customer with an annual peak demand of 500 kW or greater that returns to the service of the local distribution company the option to accept the service at pursuant to the established capped rates prices, terms, and conditions of its tariffs approved by the State Corporation Commission and abide by the current minimum stay requirements or to accept the service at market-based costs without the obligation of a minimum stay requirement.

C. The investor-owned electric local distribution company shall provide written notice, in a clear and conspicuous manner, as approved by the staff of the State Corporation Commission to qualified customers of the options identified in subsection B of this section. In addition, the investor-owned local distribution company shall supplement such written notice by providing information on its website, as approved by the staff of the State Corporation Commission, detailing the options identified in subsection B of this section.

D. The investor-owned local distribution company's notification to the customer advising that it has received a cancellation notice from the customer's competitive service provider, as required by 20VAC5-312-80 N, shall also in a clear and conspicuous manner, as approved by the staff of the State Corporation Commission, advise the customer of the options identified in subsection B of this section.

E. The investor-owned electric local distribution company shall employ the methodology to determine its market-based costs as provided in 20VAC5-313-40 and approved by the State Corporation Commission in Case No. PUE-2004-00068 for any customer electing such option and subsequently returning to the local distribution company.

F. The investor-owned electric local distribution company shall submit a tariff containing the market-based prices determined in subsection E of this section to the State Corporation Commission for approval prior to implementing such prices. ]

20VAC5-313-30. Exemption to wires charges. (Repealed.)

A. This section applies to an investor-owned electric local distribution company imposing wires charges on its customers, except those customers participating in pilot programs approved by the State Corporation Commission in Case No. PUE-2003-00118, and to competitive service providers serving such customers.

B. The investor-owned electric local distribution company shall offer large industrial customers or large commercial customers, as well as any group of customers of any rate class aggregated together, subject to the participation limits of subsection I of this section, and upon the customer's notice to participate at least 60 days in advance, the option to purchase retail electric energy from licensed competitive service providers without the obligation to pay any wires charges imposed by the utility in exchange for the customers' agreement to pay market-based costs upon any subsequent return to service of the local distribution company.

C. The investor-owned electric local distribution company shall provide written notice, in a clear and conspicuous manner, as approved by the staff of the State Corporation Commission, to qualified customers of the options identified in subsection B of this section and associated risks, particularly the customer's inability to ever return to service of the local distribution company at capped rates. In addition, the investor-owned local distribution company shall supplement such written notice by providing information on its website, as approved by the staff of the State Corporation Commission, detailing the options identified in subsection B of this section.

D. The investor-owned electric local distribution company shall employ the methodology to determine its market-based costs as provided in 20VAC5-313-40 and approved by the State Corporation Commission in Case No. PUE-2004-00068 for any customer electing such option and subsequently returning to the local distribution company.

E. An aggregator electing to serve a group of electric customers and acting on behalf of each customer and electing the option offered through subsection B of this section shall do so on behalf of its total aggregated load.

F. A contract of an aggregator and a competitive service provider serving such qualified customers shall contain a clear and conspicuous caption: "Customer's Right to Exemption of Wires Charges," in bold face type of a minimum size of 10 points, disclosing any wires charges imposed by the local distribution company, including options to exempt such payment, and associated risks to exercise such options, including the inability to ever return to service of the local distribution company at capped rates.

G. The investor-owned local distribution company's notification to the customer advising of an enrollment request, as required by 20VAC5-312-80 I, for customers electing to waive the wires charges, shall in a clear and conspicuous manner, as approved by the staff of the State Corporation Commission, state that the customer will not be required to pay wires charges, but that the customer will not ever return to service of the local distribution company at capped rates.

H. The competitive service provider serving a customer that is not obligated to pay wires charges shall provide the investor-owned local distribution company 60 days notice prior to terminating service to such a customer.

I. The election to be exempt from any wires charges is available to the first 1,000 MW or 8.0% of the investor-owned electric local distribution company's prior year Virginia adjusted peak-load.

J. Such exemption provisions are enforceable until the earlier of July 1, 2007, or the termination of any imposed wires charges, while the inability to return to capped rate service remains indefinitely upon exercising this option.

Title of Regulation: 20VAC5-314. Regulations Governing Interconnection of Small Electrical Generators (adding 20VAC5-314-10 through 20VAC5-314-170).

Statutory Authority: §§ 12.1-13 and 56-578 of the Code of Virginia.

Public Hearing Information: Public hearing will be held upon request.

Public Comments: Public comments may be submitted until 5 p.m. on January 15, 2009.

Agency Contact: Michael Martin, Senior Utilities Engineer, State Corporation Commission, P.O. Box 1197, Richmond, VA 23218, telephone (804) 371-9336, FAX (804) 371-9350, or email mike.martin@scc.virginia.gov.

Summary:

Pursuant to § 56-578 A of the Virginia Electric Utility Restructuring Act, Chapter 23 (§ 56 576 et seq.) of Title 56 of the Code of Virginia (Restructuring Act), all electric energy distributors have the obligation to connect any retail customer, including those using distributed generation, located within its service territory to the distributor's facilities used for delivery of retail electric energy, subject to State Corporation Commission (commission) rules and regulations and approved tariff provisions relating to connection of service. In accordance with § 56-578 C of the Restructuring Act, the commission proposed interconnection standards, not inconsistent with nationally recognized standards, to ensure transmission and distribution safety and reliability. Based upon comments received on the proposed interconnection standards published in the Virginia Register, the commission now directs that revisions to the proposed interconnection standards be made available for comment. These interconnection standards are now republished as reproposed regulations for further comment.

The interconnection regulations establish standardized interconnection and operating requirements for the safe operation of electric generating facilities with a rated capacity of 20 MW or less connected to the distribution systems of electric utilities under the jurisdiction of the Virginia State Corporation Commission. These requirements apply to retail electric customers, independently owned generators or any other parties operating or intending to operate a distributed generation facility. The regulations establish three interconnection review paths for interconnection of customer-sited generation in Virginia - Level 1, Level 2 and Level 3. Level 1 interconnections must include a request to interconnect a certified inverter-based generating facility no larger than 500 kW. To qualify for a Level 2 interconnection request, the generating facility can be no larger than 2 MW and the proposed generator must meet certain specified codes, standards, and certification requirements. Level 3 interconnection requests apply to generating facilities larger than 2 MW but no larger than 20 MW or a generating facility that does not pass the Level 1 or Level 2 Process. The revised proposed interconnection regulations for distributed generation are intended to more clearly delineate the responsibility of each party under an interconnection agreement. The revisions also clearly identify the cost responsibility of each party while more clearly identifying what costs can be charged interconnection customers. Moreover, the revisions are intended to make the interconnection regulations more readable.

AT RICHMOND, NOVEMBER 26, 2008

COMMONWEALTH OF VIRGINIA, ex rel.

STATE CORPORATION COMMISSION

CASE NO. PUE-2008-00004

Ex Parte: In the matter of establishing
interconnection standards for distributed
electric generation

ORDER

On February 26, 2008, the State Corporation Commission ("Commission") issued an Order Establishing Proceeding in the above-captioned case to consider interconnection standards for distributed generation for the Commonwealth in accordance with § 56‑578 A of the Virginia Electric Utility Restructuring Act, Chapter 23 (§ 56‑576 et seq.) of Title 56 of the Code of Virginia ("Code"). The Staff of the Commission developed proposed rules to meet the requirement of § 56‑578 C of the Restructuring Act, Chapter 314, Regulations Governing Interconnection of Small Electrical Generators, and the Commission directed that notice be given to the public and invited comments on Staff's proposed rules.

Following comments filed on Staff's proposed rules,¹ the Commission granted Staff leave to file a response to the comments filed.²

On October 27, 2008, the Staff of the Commission filed its Motion for Leave to File ("Motion") requesting that it be granted leave to file its Staff Report, also filed on October 27, 2008, one business day out of time. The Staff Report includes revised rules in response to the comments filed.

NOW THE COMMISSION, having considered Staff's Motion, is of the opinion and finds that it should be granted. We further find that notice of Staff's revised rules, attached hereto as Appendix A, should be given to the public and that interested persons should have an opportunity to comment on Staff's revised rules (Appendix A).

Accordingly, IT IS ORDERED THAT:

(1) Staff is hereby granted its Motion and the Staff Report filed on October 27, 2008, is hereby received into the record of this case.

(2) The Commission's Division of Information Resources shall forward a copy of this Order including Appendix A to the Registrar of Regulations for publication in the Virginia Register.

(3) On or before January 15, 2009, interested persons may file an original and fifteen (15) copies of comments with Joel H. Peck, Clerk, State Corporation Commission, c/o Document Control Center, P.O. Box 2118, Richmond, Virginia 23218. Comments shall refer to Case No. PUE‑2008‑00004 and address Staff's revised rules (Appendix A).

(4) This matter shall remain open for further order of the Commission.

Commissioner Dimitri did not participate in this matter.

AN ATTESTED COPY hereof shall be sent by the Clerk of the Commission to: T. Borden Ellis, Senior Attorney, Legal, NiSource Corporate Services Company, 1809 Coyote Drive, Chester, Virginia 23836; Noelle J. Coates, Esquire, Hunton & Williams LLP, Riverfront Plaza, East Tower, 951 East Byrd Street, Richmond, Virginia 23219-4074; Horace P. Payne, Jr., Esquire, Dominion Resources Services, Inc., 120 Tredegar Street, RS‑2, Richmond, Virginia 23219; John A. Pirko, Esquire, LeClairRyan, P.C., 4201 Dominion Boulevard, Suite 200, Glen Allen, Virginia 23060; Charles E. Bayless, Esquire, Appalachian Power Company, P.O. Box 1986, Charleston, West Virginia 25327; Kevin Fox, Esquire, Keyes & Fox LLP, 5727 Keith Avenue, Oakland, California 94618; C. Meade Browder, Jr., Senior Assistant Attorney General, Division of Consumer Counsel, Office of Attorney General, 900 East Main Street, 2nd Floor, Richmond, Virginia 23219; and the Commission's Office of General Counsel and Divisions of Energy Regulation and Economics and Finance.

_______________________________________

¹ The Commission granted extensions for comments to be filed on May 15, 2008, and August 28, 2008.

² Order issued August 28, 2008. The Staff was granted a filing extension to October 24, 2008, by Order Granting Extension to Staff issued September 24, 2008.

CHAPTER 314
REGULATIONS GOVERNING INTERCONNECTION OF SMALL ELECTRICAL GENERATORS

20VAC5-314-10. Applicability and scope.

These regulations are promulgated pursuant to § 56-578 of the Virginia Electric Utility Restructuring Act (§ 56-576 et seq. of the Code of Virginia). They establish standardized interconnection and operating requirements for the safe operation of electric generating facilities with a rated capacity of 20 megawatts (MW) or less connected to [ distribution companies' electric utility ] distribution [ (and in certain cases transmission) ] systems in Virginia. These [ requirements regulations ] apply to retail electric customers, independently owned generators [ or and ] any other parties operating [ , ] or intending to operate [ , ] a distributed generation facility [ in parallel with a utility's system and to the utility ]. [ Interconnections These regulations do not apply to customer generators operating pursuant to the commission's Regulations Governing Net Energy Metering (20VAC5-315) or those ] that fall under the jurisdiction of the Federal Energy Regulatory Commission [ are not subject to these regulations ].

[ If the utility has turned over control of its transmission system to a Regional Transmission Entity (RTE), and if the small generator interconnection process identifies upgrades to the transmission system as necessary to interconnect the small generating facility, then the utility will coordinate with the RTE, and the procedures herein will be adjusted as necessary to satisfy the RTE's requirements with respect to such upgrades. ]

There are three [ interconnection ] review paths for [ the ] interconnection of [ customer-sited ] generation in Virginia [ having an output of not more than 20 MW ]:

Level 1 - A request to interconnect a [ certified inverter-based ] small generating facility [ (SGF) ] no larger than 500 kilowatts (kW) shall be evaluated under the Level 1 process.

Level 2 - A request to interconnect a certified [ small generating facility SGF no ] larger than [ 500 kW but no larger than ] 2 MW [ and not qualifying for the Level 1 process ] shall be evaluated under the Level 2 process.

Level 3 - A request to interconnect [ a small generating facility larger than 2 MW but an SGF ] no larger than 20 MW [ or a small generating facility that does not pass and not qualifying for ] the Level 1 [ process ] or Level 2 process, shall be evaluated under the Level 3 process.

[ An SGF proposed to be interconnected to a distribution feeder may be limited to a capacity substantially less than 20 MW, depending upon the characteristics of that feeder and the potential for upgrading it, as well as the nature of the loads and other generation on the feeder relative to the proposed point of interconnection. ]

The utility shall designate an employee or office from which [ the interconnection customer ("IC") may informally request ] information [ on concerning ] the application process [ can be obtained through informal requests from the interconnection customer presenting a proposed project for a specific site ]. The name, telephone number, and email address of such contact employee or office shall be made available on the utility's Internet web site. Electric system information [ for specific locations, feeders, or small areas relevant to the location of the proposed SGF ] shall be provided to the [ interconnection customer IC ] upon request and may include [ relevant system studies, ] interconnection studies [ , ] and [ any ] other [ relevant ] materials [ useful to an understanding of an interconnection at a particular point on the utility's system ], to the extent such provision does not violate confidentiality provisions of prior agreements or [ release ] critical infrastructure [ requirements information ]. The utility shall comply with reasonable requests for such information unless the information is proprietary or confidential and cannot be provided pursuant to a confidentiality agreement.

The utility shall make reasonable efforts to meet all time frames provided in these [ procedures regulations ] unless the utility and the [ interconnection customer IC ] agree to a different schedule. If the utility cannot meet a deadline provided herein, it shall notify the [ interconnection customer IC ], explain the reason for the failure to meet the deadline, and provide an estimated time by which it will complete the applicable interconnection procedure in the process.

20VAC5-314-20. Definitions.

The following terms when used in this chapter shall have the following meaning unless the context clearly indicates otherwise:

"Affected system" means an electric [ utility ] system other than [ that of ] the [ utility's distribution system utility ] that may be affected by the proposed interconnection.

[ "Affected system operator" means an entity that operates an affected system or, if the affected system is under the operational control of an independent system operator or a regional transmission entity, such independent entity.

"Applicable laws and regulations" means all duly promulgated applicable federal, state and local laws, regulations, rules, ordinances, codes, decrees, judgments, directives, or judicial or administrative orders, permits and other duly authorized actions of any government authority.

"Attachment facilities" means the facilities and equipment owned, operated, and maintained by the utility that are built new in order to physically connect the customer's interconnection facilities to the utility system. Attachment facilities shall not include distribution upgrades or previously existing distribution and transmission facilities. ]

"Business day" means Monday through Friday, excluding federal holidays.

[ "Certified" has the meaning ascribed to it in Schedule 2 of this chapter.

"Customer's interconnection facilities" means all of the facilities and equipment owned, operated and maintained by the interconnection customer, between the small generating facility and the point of interconnection necessary to physically and electrically interconnect the small generating facility to the utility system. ]

"Commission" means the Virginia State Corporation Commission.

[ "Distribution company" means the utility that owns and/or operates the distribution system located in Virginia to which the small generation facility proposes to interconnect its small generating facility. ]

[ "Default" means the failure of a breaching party to cure its breach under the small generator interconnection agreement. ]

"Distribution system" means [ a the ] utility's facilities and equipment generally delivering electricity to ultimate customers from substations supplied by higher voltages (usually at transmission level). For purposes of these [ interconnection rules regulations], all portions of the [ distribution company's utility's ] transmission system regulated by the commission for which interconnections are not within Federal Energy Regulatory Commission (FERC) jurisdiction are considered [ also ] to be [ part of subject to ] these interconnection [ rules regulations ].

"Distribution upgrades" means the additions, modifications, and upgrades to the utility's distribution system at or beyond the point of interconnection [ to facilitate necessary to abate problems on the utility's distribution system caused by the ] interconnection of the small generating facility [ and to render the service necessary to effect the interconnection customer's operation of on-site generation ]. Distribution upgrades do not include [ customer's ] interconnection facilities [ or attachment facilities ].

"Energy service provider" means any entity supplying electric energy [ service ] to the [ producer, either as tariffed, competitive, or default service pursuant to § 56-585 of the Code of Virginia interconnection customer ].

[ "Facilities study" has the meaning ascribed to it in 20VAC5-314-70 E.

"Feasibility study" has the meaning ascribed to it in 20VAC5-314-70 C.

"FERC" means the Federal Energy Regulatory Commission.

"Good Utility Practice" means any of the practices, methods and acts engaged in or approved by a significant portion of the electric industry during the relevant time period, or any of the practices, methods and acts which, in the exercise of reasonable judgment in light of the facts known at the time the decision was made, could have been expected to accomplish the desired result at a reasonable cost consistent with good business practices, reliability, safety and expedition. Good Utility Practice is not intended to be limited to the optimum practice, method, or act to the exclusion of all others, but rather to be acceptable practices, methods, or acts generally accepted in the region.

"Governmental authority" means any federal, state, local or other governmental regulatory or administrative agency, court, commission, department, board, or other governmental subdivision, legislature, rulemaking board, tribunal, or other governmental authority having jurisdiction over the parties, their respective facilities, or the respective services they provide, and exercising or entitled to exercise any administrative, executive, police, or taxing authority or power; provided that such term does not include the interconnection customer, the utility or a utility affiliate. ]

"Interconnection customer" or "IC" means any entity [ , including the utility, any affiliates or subsidiaries of either, ] proposing to interconnect a new small generating facility with the [ utility's utility ] system [ under this chapter ] .

[ "Interconnection facilities" means the utility's interconnection facilities and the interconnection customer's interconnection facilities. Collectively, interconnection facilities include all facilities and equipment between the small generating facility and the point of interconnection, including any modification, additions or upgrades that are necessary to physically and electrically interconnect the small generating facility to the utility's distribution system. Interconnection facilities are sole use facilities and shall not include distribution upgrades. ]

"Interconnection request" means the [ interconnection customer's IC's ] request, in accordance with the tariff, to interconnect a new small generating facility, or to increase the capacity of, or make a material modification to the operating characteristics of, an existing small generating facility that is interconnected with the [ utility's utility ] system.

"Interconnection [ study studies ] " means the [ study that is undertaken studies conducted ] by the [ company utility ], or a [ mutually agreed upon ] third party agreed to by the [ company utility ] and the [ producer interconnection customer ], in order to determine the interaction of the small generating facility [ and with ] the [ distribution utility ] system [ , ] and [ the affected systems in order ] to specify any [ modification modifications ] to the small generating facility or the [ distribution system needed electric systems studied ] to ensure safe and reliable operation of the small generating facility in parallel with the [ distribution utility ] system.

[ "Material modification" means a modification that has a material impact on the cost or timing of any interconnection request with a later queue priority date.

"Operating requirements" means any operating and technical requirements that may be applicable due to regional transmission entity, independent system operator, control area, or the utility's requirements, including those set forth in the Small Generator Interconnection Agreement. ]

"Party" or "parties" means the utility, interconnection customer, or [ any combination thereof both ].

"Point of interconnection" means the point where the [ customer's ] interconnection facilities connect [ with to ] the [ utility's utility ] system.

[ "Producer" means a person operating a small generating facility interconnected to the distribution system of a utility for the purpose of parallel operation.

"Regional Transmission Entity" or "RTE" means an entity having the management and control of a utility's transmission system as further set forth in § 56-579 of the Code of Virginia. ]

"Small generating facility" [ or "generator" or "SGF" ] means the interconnection customer's [ device equipment ] for the production of electricity identified in the interconnection request [ , but shall not include the interconnection facilities not owned by the interconnection customer ].

[ "Study process" means the procedure for evaluating an interconnection request that includes the Level 3 scoping meeting, feasibility study, system impact study, and facilities study.

"Small Generator Interconnection Agreement" or "SGIA" means the agreement between the utility and the interconnection customer as set forth in Schedule 6 of 20VAC5-314-170.

"Supplemental review" has the meaning ascribed to it in 20VAC5-314-60 G. ]

"System" [ or "utility system" ] means the [ distribution and transmission ] facilities owned, controlled, or operated by the utility that are used to [ provide electric service under the tariff deliver electricity ].

[ "System impact study" has the meaning ascribed to in 20VAC5-314-70 E. ]

"Tariff" means the rates, terms and conditions filed by the utility with the commission for the purpose of providing commission-regulated electric service to retail customers.

[ "Transmission system" means the utility's facilities and equipment delivering electric energy to the distribution system, such facilities being operated at voltages above the utility's typical distribution system voltages. ]

"Utility" means the public utility company subject to regulation by the commission pursuant to Chapter 10 (§ 56-232 et seq.) of Title 56 of the Code of Virginia with regard to rates and/or service quality [ to which the interconnection customer proposes to interconnect a small generating facility ].

20VAC5-314-30. Siting of distributed generation facilities.

Prior to installing a small generating facility, the [ IC interconnection customer ] must ensure compliance with local, state and federal laws and regulations, including [ siting. If the producer has satisfied the requirements of this chapter and has submitted a copy of his interconnection notification form to the commission's Division of Energy Regulation, the statutory requirements of § 56-580 D all applicable easements and permits, and §§ 56-265.2 and 56-580 ] of the Code of Virginia [ shall be deemed to have been met, as applicable ].

20VAC5-314-40. Level 1 interconnection process.

[ A. ] The Level 1 interconnection [ path process ] is available to any [ IC interconnection customer ] proposing to interconnect a small generating facility with the [ utility's distribution utility ] system if the [ small generating facility SGF ] is no larger than 500 kW. [ In order to interconnect under this path, the small generating facility shall complete the streamlined Interconnection Request Form contained in 20VAC5-314-170 as Schedule 1. The utility shall follow the same time line established by the commission in 20VAC5-315-30 of the Net Metering Regulations.

B. An IC may begin operation of a small generating facility when:

1. The IC has completed the Level 1 Interconnection Request Form (Schedule 1 in 20VAC5-314-170) and submitted it to the utility with the required $100 processing fee attached. The utility shall submit a copy of the Interconnection Notification Form to the commission's Division of Energy Regulation. The utility may supply a commission-approved Interconnection Request Form similar to Schedule 1;

2. If required by the utility's tariff, the IC has installed a lockable, utility-accessible, load breaking manual disconnect switch;

3. A licensed electrician has certified, by signing the Interconnection Request Form, that any required manual disconnect switch has been installed properly and that the small generating facility has been installed in accordance with the manufacturer's specifications as well as all applicable provisions of the National Electrical Code;

4. The vendor of the SGF has certified on the Interconnection Request Form that the SGF equipment is in compliance with the requirements established by Underwriters Laboratories or other national testing laboratories in accordance with IEEE Standard 1547, Standard for Interconnecting Distributed Resources with Electric Power Systems;

5. In the case of a static inverter-connected SGF with an alternating current capacity in excess of 10 kilowatts, the IC has had the inverter settings inspected by the utility. The utility may not impose a charge for the inspection;

6. In the case of a nonstatic inverter-connected SGF, the IC has interconnected according to the utility's interconnection guidelines, and the utility has inspected all protective equipment settings. The utility may not impose a charge for such inspection.

7. In the case of an SGF having an alternating current capacity greater than 25 kilowatts, the following requirements shall be met before interconnection may occur:

a. Distribution facilities and customer impact limitations. An SGF shall not be permitted to interconnect to distribution facilities if the interconnection would reasonably lead to damage to any of the utility's facilities or would reasonably lead to voltage regulation or power quality problems at other customer revenue meters due to the incremental effect of the SGF on the performance of the system, unless the IC reimburses the utility for its cost to modify any facilities needed to accommodate the interconnection.

b. Secondary, service, and service entrance limitations. The capacity of the SGF shall be less than the capacity of the utility-owned secondary, service, and service entrance cable connected to the point of interconnection, unless the IC reimburses the utility for its cost to modify any facilities needed to accommodate the interconnection.

c. Transformer loading limitations. The SGF shall not have the ability to overload the utility's distribution transformer, or any distribution transformer winding, beyond manufacturer or nameplate ratings, unless the IC reimburses the utility for its cost to modify any facilities needed to accommodate the interconnection.

d. Integration with utility's grounding. The grounding scheme of the SGF shall comply with the IEEE 1547, Standard for Interconnecting Distributed Resources with Electric Power Systems, and shall be consistent with the grounding scheme used by the utility. If requested by an IC, the utility shall assist the IC in selecting a grounding scheme that coordinates with its distribution system.

e. Balance limitation. The SGF shall not create a voltage imbalance of more than 3.0% at any other customer's revenue meter if the utility distribution transformer, with the secondary connected to the point of interconnection, is a three-phase transformer, unless the IC reimburses the utility for its cost to modify any facilities needed to accommodate the interconnection.

C. Neither the utility nor the energy service provider shall impose any charges upon an IC for any interconnection requirements specified by this chapter, except as may be incurred in providing off-site metering.

D. The IC shall immediately notify the utility of any changes in the ownership of, operational responsibility for, or contact information for the SGF.

E. The utility shall not be required to maintain an interconnection with an SGF if the SGF or associated equipment is found to be out of compliance with the codes, standards and certifications applicable to the SGF. ]

20VAC5-314-50. Levels [ 1 2 ] and [ 2 3 ] interconnection request general requirements.

A. The interconnection customer shall submit [ it’s a completed Levels 2 and 3 ] Interconnection Request Form [ contained in (Schedule 4 of ] 20VAC5-314-170 [ (Schedule 4 ]) to the utility, with the processing fee or deposit specified in the Interconnection Request Form. [ The utility shall provide a copy of the Interconnection Request Form to the commission's Division of Energy Regulation. ] The Interconnection Request Form shall be date- and time-stamped upon receipt by the utility [ , which. The date- and time-stamp of a completed Interconnection Request Form ] shall be used as the qualifying date- and time-stamp for the purposes of any timetable in these procedures. The interconnection customer shall be notified of receipt by the utility within three business days of receiving the interconnection request, which notification may be [ to an by US mail, ] email address or fax number provided by the IC.

The utility shall notify the interconnection customer within 10 business days of the receipt of the Interconnection Request Form as to whether the Interconnection Request Form is complete or incomplete. If the Interconnection Request Form is incomplete, the utility shall [ provide, along with the notice that the Interconnection Request Form is incomplete, so notify the IC, including ] a written list detailing all information that must be provided to complete the Interconnection Request Form.

The interconnection customer [ will shall ] have 10 business days after receipt of the notice [ of incomplete information ] to submit the listed information or to request an extension of time to provide such information. If the [ interconnection customer IC ] does not provide the listed information or a request for an extension of time within the deadline, the Interconnection Request Form will be deemed withdrawn. [ An Interconnection Request Form will be deemed complete upon submission of the listed information to the utility.

The utility shall provide a copy of the final completed date- and time-stamped Interconnection Request Form to the commission's Division of Energy Regulation. ]

B. Any [ material ] modification to machine data or equipment configuration or to the interconnection site of the small generating facility as specified in the Interconnection Request Form but not agreed to in writing by the utility and the [ interconnection customer IC ] may be deemed a withdrawal of the Interconnection Request Form and may require submission of a new Interconnection Request Form, unless proper notification of each party by the other and a reasonable time to cure the problems created by the changes are undertaken.

C. Site control documentation must be submitted with the [ interconnection request Interconnection Request Form ]. [ Any information appearing in public records may not be labeled Confidential. (Confidential information is discussed in 20VAC5-314-110.) ] Site control may be demonstrated through:

1. Ownership of, a leasehold interest in, or a right to develop a site for the purpose of constructing the small generating facility;

2. An option to purchase or acquire a leasehold site for such purpose;

3. An exclusivity or other business relationship between the interconnection customer and the entity having the right to sell, lease, or grant the [ interconnection customer IC ] the right to possess or occupy a site for such purpose.

D. The utility shall place interconnection requests [ in into ] a first come, first served [ order per queue that is based on the interconnection's distribution ] feeder and [ per distribution ] substation [ . The queue position shall be ] based upon the date- and time-stamp of the [ completed ] Interconnection Request Form. The [ order of each Interconnection Request Form queue position of an interconnection request ] will be used to determine the cost responsibility for the [ necessary ] upgrades [ necessary to accommodate the interconnection ]. At the utility's option, interconnection requests may be studied serially or in clusters for the purpose of the system impact study.

[ E. The utility shall not be required to maintain an interconnection with an SGF if the SGF or associated equipment is found to be out of compliance with the codes, standards and certification applicable to the SGF. ]

20VAC5-314-60. Level 2 interconnection process.

A. The Level 2 interconnection process is available to an interconnection customer proposing to interconnect a small generating facility with the [ utility's distribution utility ] system if the [ small generating facility SGF ] is no larger than 2 MW and [ if the interconnection customer's proposed small generating facility does not qualify for the Level 1 process, and ] meets the codes, standards, and certification requirements of Schedules 2 and 3 in 20VAC5-314-170.

B. Within 15 business days after the utility notifies the [ interconnection customer IC ] it has received a complete [ interconnection request Interconnection Request Form ], the utility shall perform an initial review using the screens set forth below and shall notify the [ interconnection customer IC ] of the results including copies of the analysis and data underlying the utility's determinations under the screens.

[ 1. The proposed small generating facility's point of interconnection must be on a portion of the utility's distribution system that is subject to the tariff. ]

[ C. Interconnection to radial circuits. ]

[2. 1. ] For interconnection of a [ proposed ] small generating facility to a radial distribution circuit, the aggregated generation, including the proposed small generating facility, on the circuit shall not exceed 15% of the line section's annual peak load as most recently measured at the substation or calculated for the line [ segment section ]. A line section is that portion of a [ utility's electric system distribution circuit ] connected to a customer [ that is ] bounded by automatic sectionalizing devices or the end of the [ distribution line circuit ].

[ 3. 2. ] The [ proposed small generating facility SGF ], in aggregation with other generation on the distribution circuit, shall not contribute more than 10% to the [ distribution ] circuit's maximum fault current at the point on the distribution [ feeder feeder's (primary) ] voltage [ (primary) ] level [ that is ] nearest the [ proposed ] point of [ change of ownership interconnection ].

[ 4. 3. ] The [ proposed small generating facility SGF ], in aggregate with other generation on the distribution circuit, shall not cause any distribution protective devices and equipment (including, but not limited to, substation breakers, [ fuse fused ] cutouts, and line reclosers), or interconnection customer equipment on the system to exceed 87.5% of the short circuit interrupting capability; nor shall the interconnection be [ proposed for permitted on ] a circuit [ that already exceeds where ] 87.5% of the short circuit interrupting capability [ is already exceeded ].

[ 5. Using 4. For interconnections to the distribution primary voltage, use ] the table below, [ to ] determine the [ acceptable ] type of interconnection to a primary distribution [ line circuit ]. This screen includes a review of the type of electrical service provided to the [ interconnection customer IC ], including line configuration and the transformer connection [ , ] to limit the potential for creating over-voltages on the utility's [ electric power distribution ] system due to a loss of ground during the operating time of any anti-islanding function.

[ 6. 5. ] If the [ proposed ] small generating facility is to be interconnected [ on to a ] single-phase shared secondary, the aggregate generation capacity on the shared secondary, including the proposed [ small generating facility SGF ], shall not exceed 20 kW.

[ 7. 6. ] If the [ proposed small generating facility SGF ] is single-phase and is to be interconnected on a center tap neutral of a 240 volt service, its addition shall not create an imbalance between the two sides of the 240 volt service of more than 20% of the nameplate rating of the service transformer.

[ 8. 7. ] The [ small generating facility SGF ], in aggregate with [ other ] generation interconnected to the transmission side of [ a the ] substation transformer [ feeding that feeds ] the [ distribution ] circuit where the [ small generating facility SGF ] proposes to interconnect [ , ] shall not exceed 10 MW in an area where there are known, or posted, transient stability limitations to generating units located in the general electrical vicinity (e.g., three or four transmission busses from the point of interconnection).

[ 9. 8. ] No construction of facilities by the utility on its own system shall be required to accommodate the [ small generating facility SGF, except minor modifications ].

[ C. D. ] Interconnections to [ distribution systems secondary voltage networks (120 volts to 480 volts) ].

1. For interconnection of a [ proposed ] small generating facility to the load side of spot network protectors serving more than a single customer, the [ proposed small generating facility SGF ] must utilize an inverter-based equipment package and, together with the aggregated other inverter-based generation, shall not exceed the smaller of 5.0% of a spot network's maximum load or 300 kW. For spot networks serving a single customer, the [ small generating facility SGF ] must use [ an ] inverter-based equipment package and either meet the requirements above [ , ] or [ shall ] use a protection scheme [ , ] or operate the generator so as not to exceed on-site load or otherwise prevent nuisance operation of the spot network protectors.

2. For interconnection of [ a proposed small generating facility an SGF ] to the load side of area network protectors, the [ proposed small generating facility SGF ] must utilize an inverter-based equipment package and, together with the aggregated other inverter-based generation, shall not exceed the smaller of 10% of an area network's minimum load [ , ] or 500 kW.

3. [ Notwithstanding subdivision 1 or 2 of this subsection, each utility may incorporate into its interconnection standards any change in interconnection guidelines related to networks pursuant to standards developed under IEEE 1547 for interconnections to networks. ] To the extent [ the any ] new IEEE standards conflict with this chapter, [ in particular IEEE 1547, ] the new standards shall apply. In addition, [ and with the consent of the ] utility [ , a small generating facility may be interconnected consent shall not be unreasonably withheld from an SGF interconnecting ] to a spot or area network provided the [ facility SGF ] utilizes a protection scheme that will prevent any power export from the [ customer's IC's ] site including inadvertent export under fault conditions [ or, and ] otherwise prevent nuisance operation of the network protectors.

[ D. E. ] If the [ proposed ] interconnection passes the screens, the interconnection request shall be approved and the utility will provide the interconnection customer an executable interconnection agreement within [ 10 five ] business days after the determination.

[ E. F. ] If the [ proposed ] interconnection fails any screens, but the utility determines that the small generating facility may nevertheless be interconnected consistent with safety, reliability, and power quality standards, the utility shall provide the [ interconnection customer IC ] an executable interconnection agreement within five business days after the determination.

[ F. G. ] If the [ proposed ] interconnection fails [ the any ] screens, but the utility does not or cannot determine from the initial review that the [ small generating facility SGF ] may nevertheless be interconnected consistent with safety, reliability, and power quality standards [ , ] unless the [ interconnection customer IC ] is willing to consider minor modifications or further study, the utility shall provide the [ interconnection customer IC ] with the opportunity to attend a customer options meeting.

[ G. H. ] If the utility determines the [ Interconnection Request Form interconnection ] cannot be approved without minor modifications at minimal cost; a supplemental study or other additional studies or actions; or at significant cost to address safety, reliability, or power quality problems, [ within the five business day period after the determination, ] the utility shall notify the [ interconnection customer IC ] and provide copies of the data and analyses underlying its conclusion [ within five business days after determination ]. Within 10 business days of the [ utility's ] determination, the utility shall offer to convene a customer options meeting [ with the utility ] to review possible [ interconnection customer IC ] facility modifications [ , ] or the screen analysis and related results, to determine what further steps are needed to permit the [ small generating facility SGF ] to be connected safely and reliably. At the time of notification of the utility's determination, or at the customer options meeting, the utility shall:

1. Offer to perform facility modifications or minor modifications to the utility's electric system (e.g., changing meters, fuses, relay settings) and provide [ a nonbinding good faith an ] estimate of the [ limited ] cost to make such modifications to the utility's electric system;

2. Offer to perform a supplemental review if the utility concludes that the supplemental review might determine that the [ small generating facility SGF ] could continue to qualify for interconnection pursuant to the [ fast track Level 2 ] process, and provide [ a nonbinding good faith an ] estimate of the costs and time of such review; or

3. [ Obtain the interconnection customer's agreement Offer ] to continue evaluating the interconnection request [ , but ] under the Level 3 [ study interconnection ] process.

[ H. I. ] Supplemental review.

If [ the interconnection customer agrees to ] a supplemental review [ , is offered to ] the interconnection customer [ shall agree in writing within 15 business days of the offer and submit a deposit for the estimated costs provided in subdivision G 2 of this section and the IC agrees to the supplemental review, the utility shall, within 10 business days of the request, provide to the IC an appropriate supplemental review agreement. To maintain its position in the utility’s interconnection queue, the IC must execute the supplemental review agreement and return it to the utility, along with a deposit for the estimated cost of the supplemental review, within 15 business days after receipt of the agreement. If the IC fails to return the executed supplemental review agreement along with the deposit within 15 business days after receipt, the interconnection request shall be deemed withdrawn and shall lose its place in the utility’s interconnection queue ].

The [ interconnection customer IC ] shall be responsible for the utility's actual costs [ for of ] conducting the supplemental review. The [ interconnection customer IC ] shall pay any review costs that exceed the deposit within [ 20 30 ] business days of receipt of the invoice or resolution of any dispute. If the deposit exceeds the invoiced costs, the utility will return such excess within [ 20 30 ] business days of the invoice without interest.

Within 10 business days following receipt of the [ supplemental review agreement and ] deposit [ for a supplemental review ], the utility will determine if the [ small generating facility SGF ] can be interconnected safely and reliably.

1. If so, [ and if the supplemental review reveals that no modification are required to the customer’s interconnection facilities, or to the system, or to an affected system, ] the utility shall forward an executable interconnection agreement to the interconnection customer within five business days [ after the determination ].

2. If so, and [ interconnection customer facility the customer’s interconnection facilities ] modifications are required to allow the [ small generating facility SGF ] to be interconnected consistent with safety, reliability, and power quality standards under these procedures, the utility shall forward an executable interconnection agreement to the [ interconnection customer IC ] within five business days after confirmation that the [ interconnection customer IC ] has agreed to make the necessary changes at the [ interconnection customer's IC’s ] cost.

3. If so, and minor modifications to the utility's electric system are required to allow the [ small generating facility SGF ] to be interconnected consistent with safety, reliability, and power quality standards under the Level 2 process, the utility shall forward an executable interconnection agreement to the [ interconnection customer IC ] within 10 business days [ after the determination ] that requires the [ interconnection customer IC ] to pay the costs of such system modifications prior to interconnection.

4. If not, the interconnection request will [ continue to ] be [ evaluated under elevated to ] the Level 3 [ study interconnection ] process.

20VAC5-314-70. Level 3 interconnection process.

A. The Level 3 interconnection process shall be used by an [ IC interconnection customer ] proposing to interconnect a small generating facility with the [ utility's distribution utility ] system if the [ small generating facility SGF ] is [ (i) larger than 2 MW but ] no larger than 20 MW [ , (ii) not certified, or (iii) certified but did and does ] not pass [ or qualify for ] the Level 1 or Level 2 interconnection [ process processes ]. [ A study process consisting of As needed, a ] scoping [ meeting ], feasibility [ study ], system impact [ study ], and facilities [ study ] shall precede the preparation of [ an interconnection agreement a Small Generator Interconnection Agreement (Schedule 6 of 20VAC5-314-170) ]. [ Feasibility studies, scoping studies, and facility Any of the ] studies may be combined [ for simpler projects ] by mutual agreement of the [ utility and the ] parties.

B. Scoping [ study meeting ].

1. A scoping meeting will be held within 10 business days after the [ interconnection request Interconnection Request Form ] is deemed complete, or as otherwise mutually agreed to by the parties. The utility and the [ interconnection customer IC ] shall bring to the meeting personnel, including system engineers and other resources as may be reasonably required to accomplish the purpose of the meeting.

2. The purpose of the scoping meeting is to discuss the interconnection request. The parties shall [ further ] discuss [ whether the utility should perform a feasibility study or proceed directly to a system impact study, or a facilities study, or an interconnection agreement the studies and the cost responsibilities for the studies ]. [ If the parties agree that a feasibility study should be performed, the utility shall provide the interconnection customer, as soon as possible, but not later than five business days after the scoping meeting, a feasibility study agreement including an outline of the scope of the study and a nonbinding good faith estimate of the cost to perform the study. ]

3. The scoping meeting may be omitted by mutual agreement. [ In order to remain in consideration for interconnection, an interconnection customer who has requested a feasibility study must return the executed feasibility study agreement within 15 business days. If the parties agree not to perform a feasibility study, the utility shall provide the interconnection customer, no later than five business days after the scoping meeting, a system impact study agreement including an outline of the scope of the study and a nonbinding good faith estimate of the cost to perform the study. ]

C. Feasibility study.

[ 1. If the parties agree that a feasibility study should be performed, the utility shall provide the IC with a feasibility study agreement, including an outline of the scope of the feasibility study and an estimate of the cost to perform the study no later than five business days after the scoping meeting or five business days after the decision is made to not have a scoping meeting.

If the parties agree to not perform a feasibility study, the utility shall provide the IC a system impact study agreement including an outline of the scope of the study and an estimate of the cost to perform the study no later than five business days after the scoping meeting, or five business days after the decision is made to not have a scoping meeting.

2. To maintain its position in the utility’s interconnection queue, the IC must execute the feasibility study agreement and return it to the utility along with the deposit for the feasibility study within 15 business days after receipt of the agreement. If the IC fails to return the executed feasibility study agreement along with the deposit within 15 business days after receipt of the agreement, the interconnection request shall be deemed withdrawn and the interconnection request shall lose its place in the utility’s interconnection queue. ]

[ 1. 3. ] A feasibility study shall identify any potential adverse system impacts that would result from the interconnection of the [ small generating facility SGF ].

[ 2. 4. ] A deposit of [ the lesser of no more than ] 50% of the [ good faith ] estimated feasibility study costs or earnest money of $1,000 may be required from the interconnection customer.

a. [ Any study fees Study costs ] shall be [ based on ] the [ distribution company's utility’s ] actual [ incremental ] costs and will be invoiced to the [ interconnection customer IC ] after the study is completed and delivered and will include a summary of professional time.

b. The [ interconnection customer must IC shall ] pay any study costs that exceed the deposit without interest within 30 calendar days on receipt of the invoice or resolution of any dispute. If the deposit exceeds the invoiced fees, the [ distribution company utility ] shall refund such excess within 30 calendar days of the invoice without interest.

[ 3. 5. ] The feasibility study shall be based on the technical information provided by the [ interconnection customer IC ] in the [ interconnection request Interconnection Request Form ], as may be modified as the result of the scoping meeting. The [ distribution company utility ] reserves the right to request additional technical information from the [ interconnection customer IC ] as may reasonably become necessary consistent with [ Good Utility Practice ] during the course of the feasibility study and as designated in accordance with the standard small generator interconnection procedures. [ All modification made to the interconnection request shall be made in writing to the utility. ] If the interconnection customer modifies its interconnection request, the time to complete the feasibility study may be extended by agreement of the parties.

[ 4. 6. ] In performing the [ feasibility ] study, the [ distribution company utility ] shall rely, to the extent reasonably practicable, on recent studies. The [ interconnection customer IC ] shall not be charged for such existing studies; however, the [ interconnection customer IC ] shall be responsible for charges associated with any new study or modifications to existing studies that are reasonably necessary to perform the feasibility study.

[ 5. 7. ] The feasibility study report shall provide the following analyses for the purpose of identifying any potential adverse system impacts that would result from the interconnection of the [ small generating facility as proposed SGF ]:

a. Initial identification of any circuit breaker short circuit capability limits exceeded [ as a result of the interconnection ];

b. Initial identification of any thermal overload or voltage limit violations [ resulting from the interconnection ];

c. Initial review of grounding requirements and electric system protection; and

d. Description and [ nonbonding ] estimated cost of facilities [ and estimated construction time ] required to interconnect the [ proposed small generating facility SGF ] and to address the identified short circuit and power flow issues.

[ 6. 8. ] The feasibility study shall model the impact of the [ small generating facility regardless of purpose SGF for all purposes identified in the Interconnection Request Form ] in order to avoid the further expense and interruption of operation for reexamination of feasibility and impacts if the [ interconnection customer IC ] later changes the purpose for which the [ small generating facility SGF ] is being installed.

[ 7. 9. ] The [ feasibility ] study shall include the feasibility of [ any interconnection at a proposed project site where there could be multiple all ] potential points of interconnection, as requested by the [ interconnection customer IC ] and at the [ interconnection customer's IC’s ] cost.

[ 8. Once the feasibility study is completed, a 10. A ] feasibility study report shall be prepared and transmitted to the [ interconnection customer. Barring unusual circumstances, the feasibility study must be completed and the feasibility study report transmitted IC ] within 30 business days of the [ interconnection customer's agreement to conduct a feasibility study utility’s receipt of the complete executed feasibility study agreement and required deposit ].

[ 9. 11. ] If the feasibility study shows no potential for adverse system impacts, [ then within five business days ] the utility shall send the [ interconnection customer IC either an executable Small Generator Interconnection Agreement (Schedule 5, 20VAC5-314-170) or ] a facilities study agreement, including an outline of the scope of the study and [ a nonbinding good faith an ] estimate of the cost to perform the study.

[ 10. 12. ] If the feasibility study shows [ the ] potential for adverse system impacts, the review process shall proceed to the [ appropriate ] system impact study [ or studies ].

D. System impact study.

[ 1. No later than five business days after the parties agree that a system impact study should be performed, the utility shall provide the IC a system impact study agreement including an outline of the scope of the system impact study and an estimate of the cost to perform the study.

2. To maintain its position in the utility’s interconnection queue, the IC must execute the system impact study agreement and return it to the utility along with the deposit for the system impact study within 15 business days after receipt of the agreement. If the IC fails to return the executed system impact study agreement along with the deposit within 15 business days after receipt of the agreement, the interconnection request shall be deemed withdrawn and the interconnection request shall lose its place in the utility’s interconnection queue.

3. A deposit equal to the estimated cost of a system impact study may be required from the IC.

a. Study cost shall be the utility’s actual incremental costs and will be invoiced to the IC after the study is completed and delivered and will include a summary of professional time.

b. The IC shall pay any study costs that exceed the deposit within 30 calendar days on receipt of the invoice or resolution of any dispute. If the deposit exceeds the invoiced fees, the utility shall refund the excess within 30 calendar days of the invoice without interest. ]

[ 1. 4. ] A system impact study shall identify and detail the electric system impacts that would result if the [ proposed small generating facility SGF ] were interconnected without project modifications or electric system modifications, focusing on the adverse [ electric ] system impacts identified in the feasibility study, or [ to study potential impacts, including but not limited to those identified ] in the scoping meeting. A system impact study shall evaluate the impact of the proposed interconnection on the reliability of the electric system.

[ 2. 5. ] A system impact study will be based upon the results of the feasibility study and the technical information provided by the interconnection customer in the interconnection request. The [ distribution company utility ] reserves the right to request additional technical information from the [ interconnection customer IC ] as may reasonably become necessary consistent with [ Good Utility Practice ] during the course of the system impact study. If the [ interconnection customer IC ] modifies its designated point of interconnection, [ or ] interconnection request, or the technical information provided therein [ is modified ], the time to complete the system impact study may be extended.

[ 3. 6. ] A system impact study shall consist of a [ study of the potentially impacted transmission and distribution systems, a ] short circuit analysis, a stability analysis, a power flow analysis, voltage drop and flicker studies, [ protection and set point coordination studies, and ] grounding reviews, [ distribution load flow study, analysis of equipment interrupting ratings, protection coordination study, and impacts on electric system operation, ] as necessary. A system impact study shall state the assumptions upon which it is based, state the results of the analyses, and provide the requirement or potential impediments to providing the requested interconnection service, including a preliminary indication of the cost and length of time that would be necessary to correct any problems identified in those analyses and implement the interconnection. A system impact study shall provide a list of facilities [ and modifications ] that [ are would be ] required as a result of the interconnection [ request and nonbinding good faith along with ] estimates of cost responsibility and time to construct. [ If arranged with the utility prior to the utility preparing the system impact study agreement, the system impact study may, at the IC’s cost, include one or more alternatives to the point of interconnection; however, such alternative points must be on the same distribution circuit as the point of interconnection the IC specified as the proposed point of interconnection. ]

[ 4. A distribution system impact study shall incorporate a distribution load flow study, an analysis of equipment interrupting ratings, protection coordination study, voltage drop and flicker studies, protection and set point coordination studies, grounding reviews, and the impact on electric system operation, as necessary.

5. 7. ] Affected systems may participate in the preparation of a system impact study, with a division of costs among such entities as they may agree. All affected systems shall be afforded an opportunity to review and comment upon a system impact study that covers potential adverse system impacts on their electric systems, and the [ distribution company utility ] has 20 additional business days to complete a system impact study requiring review by affected systems.

[ 6. 8. ] If the utility uses a queuing procedure for sorting or prioritizing projects and their associated cost responsibilities for any required network upgrades, the system impact study shall consider all generating facilities (and with respect to clause iii below, any identified upgrades associated with such higher queued interconnection) that, on the date the system impact study is commenced are: (i) directly interconnected with the [ distribution company's electric utility ] system; or (ii) interconnected with affected systems and may have an impact on the proposed interconnection; and (iii) have a pending higher queued interconnection request to interconnect with the [ utility's electric utility ] system.

[ 7. 9. ] A [ distribution ] system impact study, if required, shall be completed and the results transmitted to the [ interconnection customer IC ] within [ 30 45 ] business days after an agreement is signed by the parties [ . A transmission system impact study, if required, shall be completed and the results transmitted to the interconnection customer within 45 business days after an agreement is signed by the parties ], or in accordance with the utility's queuing procedures.

[ 8. A deposit of the equivalent of the good faith estimated cost of a distribution system impact study and one-half of the good faith estimated cost of a transmission system impact study may be required from the interconnection customer.

9. Any study fees shall be based on the utility's actual costs and will be invoiced to the interconnection customer after the study is completed and delivered and will include a summary of professional time.

10. The interconnection customer shall pay any study costs that exceed the deposit within 30 calendar days on receipt of the invoice or resolution of any dispute. If the deposit exceeds the invoiced fees, the utility shall refund such excess within 30 calendar days of the invoice. Interest shall not apply.

11. If no transmission system impact study is required, adverse distribution system impacts are identified in the scoping meeting or shown in the feasibility study, a distribution system impact study shall be performed. The utility shall send the interconnection customer a distribution system impact study agreement within 15 business days of transmittal of the feasibility study report, including an outline of the scope of the study and a nonbinding good faith estimate of the cost to perform the study, or following the scoping meeting if no feasibility study is to be performed.

12. In instances where the feasibility study or the distribution system impact study shows potential for transmission system adverse system impacts, within five business days following transmittal of the feasibility study report, the utility shall send the interconnection customer a transmission system impact study agreement, including an outline of the scope of the study and a nonbinding good faith estimate of the cost to perform the study, if such a study is required.

13. If a transmission system impact study is not required, but adverse distribution system impacts are shown by the feasibility study to be possible and no distribution system impact study has been conducted, the utility shall send the interconnection customer a distribution system impact study agreement.

14. If the feasibility study shows no potential for transmission system or distribution system adverse impacts, the utility shall send the interconnection customer either an executable Small Generator Interconnection Agreement (SGIA) included in this chapter as Schedule 5 in 20VAC5-314-170, or a facilities study agreement, including an outline of the scope of the study and a nonbinding good faith estimate of the cost to perform the study, as applicable.

15. In order to remain under consideration for interconnection, the interconnection customer shall return executed system impact study agreements, if applicable, within 30 business days.

10. If the system impact study shows that facility modifications are needed to accommodate the SGF, then within five business days following transmittal of the system impact study report, the utility shall send the IC a facilities study agreement, including an outline of the scope of the study and an estimate of the cost to perform the study.]

E. Facilities study.

1. [ Once the required system impact study (or studies) is completed, a system impact study report shall be prepared and transmitted to the interconnection customer along with a facilities study agreement within five business days, including an outline of the scope of the study and a nonbinding good faith estimate of the cost to perform the facilities study. In the case where one or both impact studies are determined to be unnecessary, a notice of the fact shall be transmitted to the interconnection customer within the same timeframe. The facilities study shall specify and estimate the cost of the equipment, engineering, procurement, and construction work needed to implement the conclusion of the feasibility and/or system impact study and to allow SGF to be interconnected and operate safely and reliably. ]

[ 2. In order to remain under consideration for interconnection, or, as appropriate, in the utility's interconnection queue, the interconnection customer shall provide the following information, or a request for an extension of time within 30 business days, and the facilities study shall be based on the responses of the IC to the following queries:

a. Provide a location plan and simplified one-line diagram of the plant and station facilities. For staged projects, please indicate future generation, transmission circuits, etc. On the one-line diagram, indicate the generation capacity attached at each metering location. (Maximum load on CT (current transformer)/PT (partial transformer) On the one-line diagram, indicate the location of auxiliary power. (Minimum load on CT/PT) Amps

b. One set of metering is required for each generation connection to the new ring bus or existing distribution company station.

Number of generation connections: _____________________

c. Will an alternate source of auxiliary power be available during CT/PT maintenance?

Yes ___________ No ___________

d. Will a transfer bus on the generation side of the metering require that each meter set be designed for the total plant generation?

Yes ___________ No ___________ (Please indicate on the one-line diagram).

e. What type of control system or Programmable Logic Controller (PLC) will be located at the small generating facility?

______________________________________________

f. What protocol does the control system or PLC use?

______________________________________________

g. Provide a 7.5-minute quadrangle map of the site. Indicate the plant, station, transmission line, and property lines.

h. Physical dimensions of the proposed interconnection station: ______________________________________________

i. Bus length from generation to interconnection station: ______________________________

j. Line length from interconnection station to utility's transmission system. ________________________________________

k. Tower number observed in the field. (Painted on tower leg)*: ______________________________________________

l. Number of third party easements required for transmission lines*: ______________________________________________

*To be completed in coordination with distribution company.

m. Is the small generating facility located in utility's service area? Yes ___________ No___________;

If No, please provide name of local provider:

______________________________________________

n. Please provide the following proposed schedule dates:

Begin Construction Date:____________________________

Generator step-up transformers receive back feed power date: ___________________

Generation Testing Date:____________________________

Commercial Operation Date:____________________________

3. The facilities study shall specify and estimate the cost of the equipment, engineering, procurement, and construction work (including overheads) needed to implement the conclusions of the system impact study or studies.

4. A deposit of the good faith estimated facilities study costs may be required from the interconnection customer.

5. Any study fees shall be based on the distribution company's actual costs and will be invoiced to the interconnection customer after the study is completed and delivered and will include a summary of professional time.

6. The interconnection customer shall pay any study costs that exceed the deposit within 30 calendar days on receipt of the invoice or resolution of any dispute. If the deposit exceeds the invoiced fees, the distribution company shall refund such excess within 30 calendar days of the invoice. Interest shall not apply.

2. To maintain its position in the utility’s interconnection queue, the IC must execute the facilities study agreement and return it to the utility along with a completed Facilities Study Information Form (Schedule 5, 20VAC5-314-170) and deposit for the facilities study within 30 business days after receipt of the agreement, unless an extension has been agreed to with the utility. Otherwise, the interconnection request shall be deemed withdrawn and the interconnection request shall lose its place in the utility’s interconnection queue.

3. A deposit equal to the estimated cost of a facilities study may be required from the IC.

a. Study cost shall be the utility’s actual incremental costs and will be invoiced to the IC after the study is completed and delivered and will include a summary of professional time.

b. The IC shall pay any study costs that exceed the deposit within 30 calendar days after receipt of the invoice or resolution of any dispute. If the deposit exceeds the invoiced fees, the utility shall refund the excess within 30 calendar days of the invoice without interest. ]

[ 7. 4. ] Design for any required [ customer’s ] interconnection facilities [ , attachment facilities, ] and/or upgrades shall be performed under the facilities study [ agreement ]. The utility may contract with consultants to perform activities required under the facilities study [ agreement ]. The [ interconnection customer IC ] and the utility may agree to allow the [ interconnection customer IC ] to separately arrange for the design of some of the [ customer’s ] interconnection facilities. In such cases, facilities design will be reviewed and/or modified prior to acceptance by the utility, under the provisions of the facilities study [ agreement ]. If the parties agree to separately arrange for design and construction, and provided security and confidentiality requirements can be met, the utility shall make sufficient information available to the [ interconnection customer IC ] in accordance with confidentiality and critical infrastructure requirements [ , ] to permit the [ interconnection customer IC ] to obtain an independent design and cost estimate for any necessary facilities.

[ 8. 5. ] The facilities study shall [ specify and estimate the cost of the equipment, engineering, procurement and construction work (including overheads) needed to implement the conclusions of the system impact study or studies. The facilities study shall also ] identify (i) the electrical switching configuration of the equipment, including, without limitation, transformer, switchgear, meters, and other station equipment, (ii) the nature and estimated cost of the [ utility's interconnection attachment ] facilities and [ distribution ] upgrades necessary to accomplish the interconnection, and (iii) an estimate of the time required to complete the construction and installation of such facilities.

[ 9. 6. ] The utility may propose to group facilities required for more than one [ interconnection customer IC ] in order to minimize facilities costs through economies of scale, but any [ interconnection customer IC ] may require the installation of facilities required for its own small generating facility if it [ is willing to pay pays ] the costs of those facilities.

[ 10. Once the facilities study is completed, a facilities study report shall be prepared and transmitted to the interconnection customer. Barring unusual circumstances, the facilities study must be completed and the facilities study report transmitted within 30 business days of the interconnection customer's agreement to conduct a facilities study 11. In cases where upgrades are required, the facilities study must be completed within 45 business days of the receipt of this facilities study agreement. In cases where no upgrades are necessary, and the required facilities are limited to interconnection facilities, the facilities study must be completed within 30 business days.

7. In cases where system upgrades are required, the utility shall transmit the facilities study report within 45 business days after receipt of the complete facilities study agreement, Facilities Study Information Form, and the deposit. In cases where no system upgrades are necessary, and the required facilities are limited to customer’s interconnection facilities and attachment facilities only, the utility shall transmit the facilities study report within 30 business days after receipt of the complete facilities study agreement, Facilities Study Information Form and the deposit. ]

F. [ Interconnection agreement Small Generator Interconnection Agreement ].

1. [ Upon completion of the facilities study, and with the agreement of the interconnection customer to pay for interconnection facilities and upgrades identified in the facilities study, the utility shall provide the interconnection customer an executable SGIA within five business days Within five business days after transmittal of the final study (i.e. the facilities study, or if applicable, a combined study that satisfies all study requirements), the utility shall provide the interconnection customer an executable SGIA (Schedule 6, 20VAC5-314-170) ].

2. After receiving [ an interconnection agreement the SGIA ] from the utility, the [ interconnection customer IC ] shall have 30 business days or another mutually agreeable [ time frame deadline, ] to sign and return the [ interconnection agreement, or request that the utility file an unexecuted interconnection agreement with the commission SGIA ]. If the [ interconnection customer IC ] does not [ sign return ] the [ interconnection agreement, or ask that it be filed unexecuted by the utility within 30 business days SGIA within the deadline ], the interconnection request shall be deemed withdrawn [ and the IC shall lose its place in the utility’s queue ]. After the [ interconnection agreement SGIA ] is signed by the parties, the interconnection of the [ small generating facility SGF ] shall proceed under the provisions of the SGIA.

20VAC5-314-80. Interconnection metering.

Any metering necessitated by the use of the small generating facility shall be installed at the interconnection customer's expense in accordance with commission requirements or the utility's specifications.

20VAC5-314-90. Commissioning tests.

Commissioning tests of the interconnection customer's installed equipment shall be performed pursuant to applicable codes and standards, including IEEE 1547.1 2005 "IEEE Standard Conformance Test Procedures for Equipment Interconnecting Distributed Resources with Electric Power Systems." The utility shall be given at least five business days written notice, or notice as otherwise mutually agreed to by the parties, of the tests and [ may the utility shall ] be [ allowed to be ] present to witness the commissioning tests. The utility shall [ not ] be compensated by the [ interconnection customer IC ] for [ its expense in ] witnessing [ Level 2 and Level 3 ] commissioning tests.

20VAC5-314-100. Disputes.

A. The parties agree to attempt to resolve all disputes arising out of the interconnection process according to the provisions of this section.

B. In the event of a dispute, either party shall provide the other party with a written notice of dispute. The notice shall describe in detail the nature of the dispute. [ If the dispute has not been resolved within five business days after receipt of the notice, either party may contact a mutually agreed upon third party dispute resolution service for assistance in resolving the dispute The parties shall make a good faith effort to resolve the dispute informally within 10 business days ].

C. [ If the dispute has not been resolved within 10 business days after receipt of the notice, either party may seek resolution assistance from the commission’s Division of Energy Regulation where the matter will be handled as an informal complaint. If that process is unsatisfactory, either party may petition the commission to handle the dispute as a formal complaint.

Alternatively, the parties may seek resolution through the assistance of a dispute resolution service. ] The dispute resolution service will assist the parties in either resolving the dispute or in selecting an appropriate dispute resolution venue (e.g., mediation, settlement judge, early neutral evaluation, or technical expert) to assist the parties in resolving their dispute. [ Each party agrees to conduct all negotiations in good faith and will be responsible for one half of any costs paid to neutral third parties. ]

[ D. Each party agrees to conduct all negotiations in good faith and will be responsible for 1/2 of any costs paid to neutral third parties.

E. D. ] If [ neither party elects to seek assistance from the dispute resolution service, or if the ] attempted dispute resolution fails [ to satisfy one or both of the parties ] , then either party may exercise whatever rights and remedies it may have in equity or law consistent with the terms of the [ agreements between the parties or it may seek resolution at the commission agreement ].

20VAC5-314-110. Confidential information.

A. Confidential information shall mean any confidential and/or proprietary information provided by one party to the other party that is clearly marked or otherwise designated "Confidential." All design, operating specifications, and metering data provided by the [ interconnection customer IC ] shall be deemed confidential information regardless of whether it is clearly marked or otherwise designated as such.

B. Confidential information does not include information previously in the public domain, required to be publicly submitted or divulged by governmental authorities (after notice to the other party and after exhausting any opportunity to oppose such publication or release), or necessary to be divulged in an action to enforce an agreement between the parties. Each party receiving confidential information shall hold such information in confidence and shall not disclose it to any third party nor to the public without the prior written authorization from the party providing that information, except to fulfill obligations under agreements between the parties, or to fulfill legal or regulatory requirements.

1. Each party shall employ at least the same standard of care to protect confidential information obtained from the other party as it employs to protect its own confidential information.

2. Each party is entitled to equitable relief, by injunction or otherwise, to enforce its rights under this section to prevent the release of confidential information without bond or proof of damages, and may seek other remedies available at law or in equity for breach of this provision.

C. Notwithstanding anything in this chapter to the contrary, if the commission, during the course of an investigation or otherwise, requests information from one of the parties that is otherwise required to be maintained in confidence, the party shall provide the requested information to the commission, within the time provided for in the request for information. In providing the information to the commission, the party may request that the information be treated as confidential and nonpublic by the commission and that the information be withheld from public disclosure. Parties are prohibited from notifying the other party prior to the release of the confidential information to the commission. [ The party shall notify the other party when it is notified by the commission that a request to release confidential information has been received by the commission, at which time either of the parties may respond before such information would be made public. ]

20VAC5-314-120. [ Comparability Equal treatment ].

The utility shall receive, process, and analyze all interconnection requests in a timely manner as set forth in this chapter. The utility shall use the same reasonable efforts in processing and analyzing interconnection requests from all Interconnection customers, whether the [ small generating facility SGF ] is owned or operated by the utility, its subsidiaries or affiliates, or others.

20VAC5-314-130. Record retention.

The utility shall maintain, subject to audit, records for three years of (i) all interconnection requests received pursuant to this chapter, (ii) the times required to complete interconnection request approvals and disapprovals, and (iii) justification for the actions taken on the interconnection requests.

20VAC5-314-140. Coordination with affected systems.

The utility shall coordinate the conduct of any studies required to determine the impact of the [ interconnection request small generating facility ] on affected systems with affected system operators and, if possible, include those results (if available) in its applicable interconnection [ study studies ] within the time frame specified in this chapter. The utility will include such affected system operators in all meetings held with the [ interconnection customer IC ] as required by this chapter. The [ interconnection customer IC ] shall cooperate with the utility in all matters related to the conduct of studies and the determination of modifications to affected systems. A utility [ which that ] may be an affected system shall cooperate with the utility with [ whom which ] interconnection has been requested in all matters related to the conduct of studies and the determination of modifications to affected systems. [ The utility owning or operating the system to which the IC desires to interconnect shall not be held responsible or liable for any delays in the interconnection process attributable to the lack of information or cooperation from the owners or operators of affected systems. ]

20VAC5-314-150. Capacity of the small generating facility.

A. If the interconnection request is for an increase in capacity for an existing small generating facility, the interconnection request shall be evaluated on the basis of the new total capacity of the [ small generating facility SGF ].

B. If the interconnection request is for a [ small generating facility SGF ] that includes multiple energy production devices at a site for which the interconnection customer seeks a single point of interconnection, the interconnection request shall be evaluated on the basis of the aggregate capacity of the multiple devices.

C. The interconnection request shall be evaluated using the maximum rated capacity of the [ small generating facility SGF ].

20VAC5-314-160. Insurance.

A. For [ systems of 500 kW or less a small generating facility with a rated capacity not exceeding 10 kW ], the IC, at its own expense, shall secure and maintain in effect during the term of the agreement liability insurance with a combined single limit for bodily injury and property damage of not less than [ $300,000 $100,000 ] for each occurrence.

[ For an SGF with a rated capacity exceeding 10 kW but not exceeding 500 kW, the IC, at its own expense, shall secure and maintain in effect during the term of the agreement liability insurance with a combined single limit for bodily injury and property damage of not less than $300,000 for each occurrence. ]

For [ systems greater than an SGF with a rated capacity exceeding ] 500 kW but [ smaller than not exceeding ] 2 MW, the IC, at its own expense, shall secure and maintain in effect during the term of the agreement liability insurance with a combined single limit for bodily injury and property damage of not less than $2 million for each occurrence. Insurance coverage for [ systems greater than an SGF with a rated capacity exceeding ] 2 MW shall be determined on a case-by-case basis [ by the utility ] and shall reflect the size of the installation and the potential for system damage.

B. Except for those [ photovoltaic inverter-based ] systems [ installed on a residential premise ] that have a [ design rated ] capacity of 500 kW or less, the utility shall be named as an additional insured by endorsement to the insurance policy and the policy shall provide that written notice be given to the utility at least 30 days prior to any cancellation or reduction of any coverage. Such liability insurance shall provide, by endorsement to the policy, that the utility shall not by reason of its inclusion as an additional insured incur liability to the insurance carrier for the payment of premium of such insurance. For all [ photovoltaic inverter-based ] systems, the liability insurance shall not exclude coverage for any incident related to the subject generator or its operation.

C. Certificates of insurance evidencing the requisite coverage and provision shall be furnished to [ a the ] utility prior to the date of interconnection of the [ small generating facility SGF ]. [ Utilities The utility ] shall be permitted to periodically obtain proof of current insurance coverage form the [ producer IC ] in order to verify [ continuing ] proper liability insurance coverage. [ The ] IC will not be allowed to commence or continue interconnected operations unless evidence is provided that [ satisfactory required ] insurance coverage is in effect at all times.