FEBRUARY 1998, VOLUME 1, ISSUE 8 PAGES 993 - 1255

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DELAWARE REGISTER OF REGULATIONS

The Delaware Register of Regulations is an official State publication
established by authority of 69 Del. Laws, c. 107 and is published on the
first of each month throughout the year.

The Delaware Register will publish any regulations that are proposed to be
adopted, amended or repealed and any emergency regulations promulgated.

The Register will also publish some or all of the following information:

• Governor's Executive Orders

• Governor's Appointments

• Attorney General's Opinions in full text

• Agency Hearing and Meeting Notices

• Other documents considered to be in the public interest.

CITATION TO THE DELAWARE REGISTER

The Delaware Register of Regulations is cited by volume, issue, page number
and date. An example would be:

1:1 Del. R. 35 - 37 (July 1, 1997) refers to Volume 1, Issue 1, pages 35 -
37 of the Delaware Register issued on July 1, 1997.

CITIZEN PARTICIPATION IN THE REGULATORY PROCESS

Delaware citizens and other interested parties may participate in the
process by which administrative regulations are adopted, amended or
repealed, and may initiate the process by which the validity and
applicability of regulations is determined.

Under 29 Del.C. §10115 whenever an agency proposes to formulate, adopt,
amend or repeal a regulation, it shall file notice and full text of such
proposals, together with copies of the existing regulation being adopted,
amended or repealed, with the Registrar for publication in the Register of
Regulations pursuant to §1134 of this title. The notice shall describe the
nature of the proceedings including a brief synopsis of the subject,
substance, issues, possible terms of the agency action, a reference to the
legal authority of the agency to act, and reference to any other
regulations that may be impacted or affected by the proposal, and shall
state the manner in which persons may present their views; if in writing,
of the place to which and the final date by which such views may be
submitted; or if at a public hearing, the date, time and place of the
hearing. If a public hearing is to be held, such public hearing shall not
be scheduled less than 20 days following publication of notice of the
proposal in the Register of Regulations. If a public hearing will be held
on the proposal, notice of the time, date, place and a summary of the
nature of the proposal shall also be published in at least 2 Delaware
newspapers of general circulation; The notice shall also be mailed to all
persons who have made timely written requests of the agency for advance
notice of its regulation-making proceedings.
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SUBSCRIPTION INFORMATION
A yearly subscription for the Delaware Register of Regulations costs
$100.00 per year from January - December, for 12 issues. Single copies are
available at a cost of $9.00 per issue, including postage. For more
information contact the Division of Research at 302-739-4114 or
1-800-282-8545 in Delaware.
The opportunity for public comment shall be held open for a minimum of 30
days after the proposal is published in the Register of Regulations.
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DELAWARE REGISTER OF REGULATIONS, VOL. 1, ISSUE 8, SUNDAY, FEBRUARY 1, 1998
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INFORMATION ABOUT THE DELAWARE REGISTER OF REGULATIONS
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Except as provided in the preceding section, no judicial review of a
regulation is available unless a complaint therefor is filed in the Court
within 30 days of the day the agency order with respect to the regulation
was published in the Register of Regulations.
At the conclusion of all hearings and after receipt within the time allowed
of all written materials, upon all the testimonial and written evidence and
information submitted, together with summaries of the evidence and
information by subordinates, the agency shall determine whether a
regulation should be adopted, amended or repealed and shall issue its
conclusion in an order which shall include: (1) A brief summary of the
evidence and information submitted; (2) A brief summary of its findings of
fact with respect to the evidence and information, except where a rule of
procedure is being adopted or amended; (3) A decision to adopt, amend or
repeal a regulation or to take no action and the decision shall be
supported by its findings on the evidence and information received; (4) The
exact text and citation of such regulation adopted, amended or repealed;
(5) The effective date of the order; (6) Any other findings or conclusions
required by the law under which the agency has authority to act; and (7)
The signature of at least a quorum of the agency members.

The effective date of an order which adopts, amends or repeals a regulation
shall be not less than 10 days from the date the order adopting, amending
or repealing a regulation has been published in its final form in the
Register of Regulations, unless such adoption, amendment or repeal
qualifies as an emergency under §10119.

Any person aggrieved by and claiming the unlawfulness of any regulation may
bring an action in the Court for declaratory relief.

No action of an agency with respect to the making or consideration of a
proposed adoption, amendment or repeal of a regulation shall be subject to
review until final agency action on the proposal has been taken.

When any regulation is the subject of an enforcement action in the Court,
the lawfulness of such regulation may be reviewed by the Court as a defense
in the action.
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CLOSING DATES AND ISSUE DATES FOR THE DELAWARE REGISTER OF REGULATIONS
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ISSUE DATE CLOSING DATE CLOSING

TIME

February 1 January 15 4:30 p.m.

March 1 February 15 4:30 p.m.

April 1 March 15 4:30 p.m.

May 1 April 15 4:30 p.m.

June 1 May 15 4:30 p.m.
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DIVISION OF RESEARCH STAFF:

William S. Montgomery, Director, Division of Research; McDonald T. Coker,
Deputy Director; Kathleen K. Amalfitano, Secretary; Walter G. Feindt,
Legislative Attorney; Jeffrey W. Hague, Registrar of Regulations; Marlynn
H. Hedgecock, Administrative Officer; Maryanne McGonegal, Research Analyst;
Ruth Ann Melson, Legislative Librarian; Deborah J. Messina, Graphics
Specialist; Deborah A. Porter, Administrative Secretary; Virginia L. Potts,
Bill Service Clerk; Thom Shiels, Legislative Attorney; Marguerite P. Smith,
Public Information Clerk; Mary Jane Starkey, Senior Secretary; Marvin L.
Stayton, Printer; Rochelle Yerkes, Senior Secretary.
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DELAWARE REGISTER OF REGULATIONS, VOL. 1, ISSUE 8, SUNDAY, FEBRUARY 1, 1998
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CUMULATIVE TABLES
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The table printed below lists the regulations that have been proposed,
adopted, amended or repealed in the preceding issues of the Delaware
Register of Regulations.

The regulations are listed alphabetically by the promulgating agency,
followed by a citation to that issue of the Register in which the
regulation was published. Proposed regulations are designated with (Prop.);
final regulations are designated with (Final); Emergency regulations are
designated with (Emer.); and regulations that have been repealed are
designated with (Rep.).
Attorney General's Office

Opinion No. 97I-B01, FOIA Complaint against the Town of Laurel 1:1 Del.R.
74

Opinion No. 97I-B02, FOIA Inquiry 1:1 Del.R. 75

Opinion No. 97I-B03, FOIA Complaint against Woodbridge

School District 1:1 Del.R. 76

Opinion No. 97I-B04, Access to DELJIS 1:1 Del.R. 77

Opinion No. 97I-B05, FOIA Complaint against the Town of Laurel 1:1 Del.R.
79

Delaware State Fire Prevention Commission

1997 State Fire Prevention Regulations 1:2 Del.R. 197 (Final)

Ambulance Service Regulations 1:1 Del.R. 35 (Prop.)

Department of Administrative Services

Division of Professional Regulation

Board of Chiropractic 1:1 Del.R. 45 (Final)

Board of Dental Examiners 1:5 Del.R. 543 (Prop.)

1:7 Del.R. 852 (Final)

Board of Electrical Examiners 1:7 Del.R. 795 (Prop.)

Board of Examiners in Optometry 1:7 Del.R. 820 (Prop.)

Board of Nursing, Advanced Practice Nurse 1:1 Del.R. 15 (Prop.)

Board of Nursing 1:2 Del.R. 146 (Final)

Board of Pharmacy 1:4 Del.R. 428 (Prop.)

Board of Physical Therapy 1:2 Del.R. 101 (Prop.)

1:6 Del.R. 714 (Final)

Board of Veterinary Medicine 1:7 Del.R. 805 (Prop.)

Nursing Home Administrators 1:2 Del.R. 141 (Final)

Department of Agriculture

Aquaculture Regulations 1:4 Del.R. 309 (Prop.)

Delaware Harness Racing Commission 1:2 Del.R. 92 (Prop.)

1:5 Del.R. 498 (Final)

1:5 Del.R. 541 (Prop.)

Whips & Blood Gases 1:7 Del.R. 921 (Final)
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CUMULATIVE TABLES
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Delaware Thoroughbred Racing Commission 1:2 Del.R. 100 (Prop.)

1:3 Del.R. 248 (Prop.)

1:5 Del.R. 508 (Final)

1:6 Del.R. 649 (Prop.)

1:6 Del.R. 713 (Final)

Department of Education

Agriscience Education Framework 1:2 Del.R. 154 (Final)

Delaware Administrator Standards 1:6 Del.R. 650 (Prop.)

Delaware Teaching Standards 1:6 Del.R. 654 (Prop.)

Driver Education 1:5 Del.R. 559 (Prop.)

1:7 Del.R. 964 (Final)

DSSAA Requirements 1:2 Del.R. 172 (Final)

Education of Homeless Children & Youth 1:5 Del.R. 556 (Prop.)

1:7 Del.R. 962 (Final)

Foreign Language Content Standards 1:2 Del.R. 156 (Final)

Glossary of Terms, Manual for Certification of Professional

School Personnel 1:2 Del.R. 158 (Final)

Guidelines for Approval of School Improvement Grants 1:7 Del.R. 815 (Prop.)

High School Diploma & the Record of Performance 1:5 Del.R. 554 (Prop.)

1:7 Del.R. 960 (Final)

Interscholastic Athletics 1:4 Del.R. 361 (Prop.)

1:6 Del.R. 724 (Final)

Manual for Certification of Professional School Personnel 1:2 Del.R. 163
(Final)

Membership in Fraternities & Sororities 1:4 Del.R. 363 (Prop.)

1:6 Del.R. 723 (Final)

Regulations on School/Police Relations 1:3 Del.R. 256 (Prop.)

1:5 Del.R. 510 (Final)

Repeal of certain parts of section V, Vocational Technical

Education Programs 1:6 Del.R. 664 (Prop.)

Repeal of certain regulations concerning Student Activities 1:4 Del.R. 365
(Prop.)

1:6 Del.R. 726 (Final)

Repeal of Minimum-Maximum Program Assignment, Experimentation

and Modification 1:7 Del.R. 817 (Prop.)

Repeal of six Regulations that are in the Delaware Code 1:7 Del.R. 817
(Prop.)

Repeal of Section B.1.a, Discipline Powers & Responsibilities

of Superintendents 1:3 Del.R. 263 (Prop.)

1:5 Del.R. 517 (Final)

Requirements for Vocational Technical Education Programs 1:6 Del.R. 662
(Prop.)

Satellite School Agreements 1:2 Del.R. 170 (Final)

School Bus Regulations 1:2 Del.R. 87 (Prop.)

1:5 Del.R. 473 (Final)

State Content Standards 1:2 Del.R. 151 (Final)

Visual & Performing Arts Content Standards 1:2 Del.R. 90 (Prop.)
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1:6 Del.R. 729 (Final)

Visual & Performing Arts Graduation Requirements 1:2 Del.R. 88 (Prop.)

Department of Finance

Div. of Revenue, Delaware State Lottery Office,

Video Lottery Employee Organization and Lottery Employee

Regulations 1:3 Del.R. 243 (Prop.)

Regulations dealing with Americans with Disabilities Act 1:7 Del.R. 826
(Prop.)

Technical Information Memo. 97-6 1:6 Del.R. 712 (Prop.)

Department of Health & Social Services

Adult Abuse Registry 1:7 Del.R. 803 (Prop.)

Ambulance Provider Policy Manual, Criteria for Non-Emergency

Ambulance Transportation for Medicaid Clients in a

Nursing Facility 1:4 Del.R. 394 (Prop.)

Assisted Living Agencies, Regulations for 1:4 Del.R. 300 (Prop.)

1:7 Del.R. 951 (Final)

DHS revision of Public Law 104-193, the Personal Responsibility

and Work Opportunity Reconciliation Act, Se. 403, 8 USC 1613,

the 1993 Mickey Leland Childhood Hunger Relief Act, the Food,

Agriculture, Conservation and Trade Act Amendments of 1991

Public Law 104-203, Title 38, USC, and DSSM Sec. 4006 & 4012 1:4 Del.R. 313
(Prop.)

Division of Public Health,

Licensing & Registration of Operators of Public Water

Supply Systems 1:1 Del.R. 28 (Prop.)

1:7 Del.R. 932 (Final)

Plumbing Code Regulations 1:7 Del.R. 830 (Final)

Public Pools 1:2 Del.R. 174 (Final)

Trauma System Rules 1:2 Del.R. 110 (Prop.)

1:7 Del.R. 891 (Final)

Prehospital Trauma Triage Scheme, ALS & BLS (Errata) 1:3 Del.R. 213 (Prop.)

DMAP Sec. 410.15, Vehicles 1:4 Del.R. 368 (Prop.)

DMAP Sec. 420 Personal Needs Allowance 1:4 Del.R. 369 (Prop.)

1:7 Del.R. 921 (Final)

DSSM Section 8000, A Better Chance Program 1:4 Del.R. 297 (Prop.)

Durable Medical Equipment Manual 1:5 Del.R. 563 (Prop.)

Inpatient Hospital Provider Manual 1:4 Del.R. 370 (Prop.)

Long-Term Care Provider Manual, Billing of Third Party Payer 1:4 Del.R. 394
(Prop.)

Long-Term Care Provider Manual, Criteria for Non-Emergency

Ambulance Transportation for Medicaid Clients in a

Nursing Facility 1:4 Del.R. 394 (Prop.)

Outpatient Hospital Provider Manual 1:4 Del.R. 383 (Prop.)

Revision of Regulation of the Medicaid/Medical Assistance Program

Contained in DMAP Sec. 420 1:3 Del.R. 214 (Emer.)

1:7 Del.R. 858 (Final)
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Revision of Regulation Contained in DSSM 8201 1:5 Del.R. 456 (Emer.)

1:6 Del.R. 711 (Prop.)

Revision of Regulation Contained in DSSM 8301.3 1:3 Del.R. 215 (Emer.)

Revision of Regulation DSSM 8205.2, 8304 & 8305 1:6 Del.R. 709 (Prop.)

Department of Labor

Div. of Employment & Training, Apprenticeship Programs 1:1 Del.R. 21
(Prop.)

Div. of Industrial Affairs

Prevailing Wage Regulations 1:5 Del.R. 519 (Prop.)

Procedures of Equal Employment Review Board 1:5 Del.R. 537 (Prop.)

Special Employment Practices relating to Health Care & Child Care

Facilities & Adult Abuse Registry Check 1:5 Del.R. 533 (Prop.)

Department of Natural Resources & Environmental Control

Div. of Air & Waste Management, Air Quality Management Section,

NOx Budget Program 1:5 Del.R. 564 (Prop.)

Regulation No. 2 1:1 Del.R. 48 (Final)

Reg. No. 20, Sec. No. 28, Standards for Performance for

Municipal Solid Waste Landfills 1:4 Del.R. 330 (Prop.)

Div. of Air & Waste Management, Regulations Governing

Hazardous Waste 1:3 Del.R. 278 (Final)

Div. of Fish & Wildlife,

Atlantic Sturgeon Regulations 1:7 Del.R. 787 (Prop.)

Horseshoe Crab 1:7 Del.R. 807 (Prop.)

Shellfish Reg. No. S-41, Growing Areas Closed to Harvesting

Clams, Mussels & Oysters 1:4 Del.R. 354 (Prop.)

1:7 Del.R. 835 (Final)

Shellfish Regulation No. S-48. Conch Minimum Size Limits 1:3 Del.R. 250
(Prop.)

1:7 Del.R. 835 (Final)

Shellfish Reg. No. 55, Crab Trotlines & S-56, Crab Traps 1:4 Del.R. 354
(Prop.)

1:7 Del.R. 837 (Final)

Tidal Finfish Regulation No. 8 1:3 Del.R. 270 (Final)

Tidal Finfish Regulation No. 25 for Atlantic Shark 1:4 Del.R. 345 (Prop.)

1:7 Del.R. 844 (Final)

Div. of Water Resources, Regulations for Licensing Operators

of Wastewater Facilities 1:4 Del.R. 323 (Prop.)

1:7 Del.R. 924 (Final)

Regulations Governing the Control of Water Pollution 1:4 Del.R. 395 (Prop.)

Department of Services for Children, Youth and Their Families

Division of Family Services

Licensing Requirements for Residential Child Care Facilities

and Day Treatment Programs 1:6 Del.R. 668 (Prop.)

Office of Child Care Licensing, Child Abuse Registry 1:7 Del.R. 801 (Prop.)
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Department of State, Office of the State Bank Commissioner

Regulation No. 5.1101(f).0001, Election to be treated for tax purposes as a

"Subsidiary corporation" of a Delaware chartered banking organization or

trust company, national bank having its principal office in Delaware, or

out-of-state bank that operates a resulting branch in Delaware 1:3 Del.R.
219 (Prop.)

1:5 Del.R. 474 (Final)

Regulation No. 5.1101etal.0002, Instructions for preparation of Franchise

Tax Report 1:3 Del.R. 221 (Prop.)

1:5 Del.R. 476 (Final)

Regulation No. 5.1101etal.0003, Estimated Franchise Tax Report 1:3 Del.R.
224 (Prop.)

1:5 Del.R. 479 (Final)

Regulation No. 5.1101etal.0004, Final Franchise Tax Report 1:3 Del.R. 226
(Prop.)

maintaining branches in this state 1:3 Del.R. 228 (Prop.)

1:5 Del.R. 481 (Final)

Regulation No. 5.1101etal.0005, Instructions for preparation of

Franchise Tax for Federal Savings Banks not headquartered in this

state but maintaining branches in this state 1:3 Del.R. 228 (Prop.) 1:5
Del.R. 483 (Final)

Regulation No. 5.1101etal.0006, Estimated Franchise Tax Report Federal

Savings Banks not headquartered in Delaware 1:3 Del.R. 231 (Prop.)

1:5 Del.R. 486 (Final)

Regulation No. 5.1101etal.0007, Final Franchise Tax Report Federal

Savings Banks not headquartered in Delaware 1:3 Del.R. 232 (Prop.)

1:5 Del.R. 487 (Final)

Regulation No. 5.1101.etal.0008, Instructions for calculation of

Employment Tax Credits 1:3 Del.R. 233 (Prop.)

1:5 Del.R. 488 (Final)

Regulation No. 5.1101etal.0009, Instructions for preparation of

Franchise Tax for Resulting Branches in this state of out-of-state

banks 1:3 Del.R. 235 (Prop.)

1:5 Del.R. 490 (Final)

Regulation No. 5.1101etal.0010, Estimated Franchise Tax Report for

Resulting Branches in this state of out-of-state banks 1:3 Del.R. 239
(Prop.)

1:5 Del.R. 494 (Final)

Regulation No. 5.1101etal.0011, Final Franchise Tax Report for Resulting

Branches in this state for out-of-state banks 1:3 Del.R. 241 (Prop.)

1:5 Del.R. 496 (Final)

Regulation No. 5.131.0002, Procedures Governing the Creation &

Existence of an Interim Bank 1:5 Del.R. 592 (Prop.)

Regulation No. 5.2111(b).0005, Report of Delaware Loan Volume 1:7 Del.R.
812 (Prop.)

Regulation No. 5.2111/2210/2906.0006, Report of Delaware Assests 1:7 Del.R.
815 (Prop.)

Regulation No. 5.2210(e).0005, Report of Delaware Loan Volume 1:7 Del.R.
813 (Prop.)

Regulation No. 5.2318.0001, Report of Delaware Sale of Checks, Drafts,

and Money Orders Volume 1:7 Del.R. 813 (Prop.)
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Regulation No. 5.2906(e).0003, Report of Delaware Loan Volume

Motor Vehicle Installment Contracts 1:7 Del.R. 814 (Prop.)

Regulation No. 5.701/774.0001, Procedures for applications to form a

bank, bank & trust company or limited purpose trust company

pursuant to Chapter 7 of Title 5 of the Delaware Code 1:5 Del.R. 595
(Prop.)

1:7 Del.R. 862 (Final)

Regulation No. 5.761.0017, Incidental Powers 1:5 Del.R. 597 (Prop.)

1:7 Del.R. 865 (Final)

Regulation No. 5.770.0009, establishment of a branch office by a bank

or trust company 1:5 Del.R. 598 (Prop.)

1:7 Del.R. 866 (Final)

Regulation No. 5.771.0005, Procedures governing applications to open

branch offices outside the State of Delaware 1:5 Del.R. 599 (Prop.)

1:7 Del.R. 867 (Final)

Regulation No. 5.795etal.0016, Merger with out-of-state banks 1:5 Del.R.
601 (Prop.)

1:7 Del.R. 869 (Final)

Regulation No. 5.833.0004, Application by an out-of-state savings

institution, out-of-state savings & loan holding company or out-of-

state bank holding company to acquire a Delaware savings bank or

Delaware savings & loan holding company 1:5 Del.R. 602 (Prop.)

1:7 Del.R. 870 (Final)

Regulation No. 5.844.0009, Application by an out-of-state bank holding

company to acquire a Delaware bank or bank holding company 1:5 Del.R. 605
(Prop.)

1:7 Del.R. 873 (Final)

Regulation No. 5.777.0002, Application for a certificate of public

convenience & advantage for a limited purpose trust company pursuant

to subchapter V of Chapter 7 of Title 5 of the Delaware Code 1:5 Del.R. 609
(Prop.)

1:7 Del.R. 877 (Final)

Governor's Office

Amendment to Executive Order No. 46 1:3 Del.R. 279

Appointments & Nominations 1:1 Del.R. 68

1:2 Del.R. 200

1:3 Del.R. 281

1:4 Del.R. 438

1:5 Del.R. 623

1:6 Del.R. 740

1:7 Del.R. 970

Executive Order No. 45, Employee & Labor - Management Relations

in State Government 1:1 Del.R. 63

Executive Order No. 46, Governor's Task Force on Violent Crime 1:1 Del.R.
64

Amendment to Executive Order No. 46 1:3 Del.R. 279

Executive Order No. 47, Executive Committee of the Workforce

Development Council 1:1 Del.R. 65

Industrial Accident Board 1:5 Del.R. 548 (Prop.)

1:7 Del.R. 938 (Final)
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Insurance Department, Regulation No. 75, Written Notice by Insurers of

Payment of Third Party Claims 1:5 Del.R. 591 (Prop.)

Public Service Commission

Regulation Docket No. 12, Notice of Investigation & Formulation of

Rules Concerning Pay Phone Services 1:1 Del.R. 5 (Prop.)

Regulation Docket No. 12, Investigation & Adoption of Rules to

Govern Payphone Services within the State of Delaware 1:3 Del.R. 263
(Prop.)

1:6 Del.R. 730 (Final)

Regulation Docket No. 47, Notice of Proposed Rule making Concerning

Intrastate Discounts for Schools & Libraries 1:1 Del.R. 9 (Prop.)

Regulation Docket No. 47, Notice of Proposed Rule making Concerning

Intrastate Discounts for Schools & Libraries 1:2 Del.R. 139 (Final)

Regulation Docket No. 47, Promulgation of Rules Regarding the Discounts

for Intrastate Telecommunications & Information Services Provided

to Schools & Libraries 1:5 Del.R. 462 (Final)

State Personnel Commission

Merit Employee Relations Board Regulations 1:3 Del.R. 274 (Final)
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ERRATA

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Administrator for the Department and the Department's designee to receive
evidence. All public comments supported the Departments proposed
regulations on sharks. Some of the commentors also recommended a 58 inch
minimum size limit for large coastal sharks in order to further protect
juveniles.

FINDINGS OF FACT

Legislation (H.B. 169), recently enacted by the 139th General Assembly,
authorizes the Department of Natural Resources and Environmental Control to
promulgate regulations for species of finfish that are consistent with
management plans approved by the U.S. Secretary of Commerce. The Secretary
of Commerce has approved Amendment One to the Fishery Management Plan for
Atlantic sharks and federal regulations for Atlantic sharks (50 CFR Part
678).

Sharks comprise a valuable marine resource to U.S. Atlantic States.
Unfortunately, Atlantic sharks have been seriously overfished in the past
two decades leading to declines of as much as 80% in some stocks. The
Delaware regulations would bring state fishery management in line with the
current federal fishery management plan for sharks of the Atlantic Ocean.
This would assist greatly the effort to stop overfishing and help rebuild
critical stocks of sharks.

Because sharks reproduce very slowly, giving live birth in most cases to a
very few young per year in a way much more like land mammals than the other
fishes, the protection of the young sharks in their nursery areas is of
paramount importance. Delaware state waters contain some shark nurseries,
including an important one in Delaware Bay for the sand tiger shark, a
popular aquarium animal and a species that has been decimated by
overfishing. Delaware Bay also is an important pupping and nursing area for
the sandbar shark. Measures to protect the young sharks in their nurseries
in state waters, therefore, will help conserve these biologically limited
stocks and rebuild populations along the Mid-Atlantic coast.

The Advisory Council on Tidal Finfisheries discussed the proposed shark
regulation at their September 16, 1997 meeting. They supported the
regulations provided the no finning and no filleting sections were reworded
to not contradict each other.

With the evidence and information received regarding Atlantic sharks, the
Department finds the attached Tidal Finfish Regulation No. 25, ATLANTIC
SHARKS, should be adopted in the public interest for the conservation of
certain Atlantic sharks in Delaware.

ORDER

It is hereby ordered, this 25th day of November, 1997 that the above
referenced Tidal Finfish Regulation No. 25, a copy of which is attached
hereto, is adopted
The following order adopting a regulation and the final regulation are
being published again due to changes that were made in the regulation as a
result of the public hearing process. The correct final regulation was not
published in issue 7. The original regulation as proposed and the final
regulation as adopted follow

Departement of Natural

Resources & Environmental Control

Division of Fish & Wildlife

Statutory Authority: 7 Delaware Code,

Section 902(e)(3) ( 7 Del.C. 902(e)(3))

In Re: Adoption of a new Tidal Finfish

Regulation No. 25 in accordance

with the approved Fishery Management

Plan for Atlantic sharks.

Order No. 97-F-0038

ORDER

SUMMARY OF THE EVIDENCE AND INFORMATION

Pursuant to due notice, the Department of Natural Resources and
Environmental Control proposes to add a new Tidal Finfish Regulation No.
25, ATLANTIC SHARKS, to be consistent with the Fishery Management Plan for
Sharks of the Atlantic Ocean, as amended, and final rules approved by the
Secretary of Commerce ( 50 CFR Part 678).

This regulation will make it illegal to possess certain sharks in the
management unit after a federal semi-annual commercial quota is landed for
large pelagic sharks, small coastal sharks or pelagic sharks; implement a
recreational creel limit; prohibit directed commercial fishing for, landing
of, or sale of five species of sharks; prohibit filleting of sharks at sea
and prohibit the removal of any fins from a shark in the management unit
and discarding the remainder at sea. These regulations are intended to
reduce effective fishing mortalities, stabilize the large coastal shark
population, facilitate enforcement and improve management of Atlantic shark
resources. Sharks in the management unit are currently at very low
populations due to recent increases in their harvest.

A public hearing was held on, October 27, 1997, in Dover, Delaware, in
front of Charles A. Lesser, Fisheries
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ERRATA
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pursuant to 7 Del. C. 903 (e)(3) and is supported by the Department's
finding on the evidence and information received. This order shall become
effective on January 31, 1997.

Christophe A.G. Tulou, Secretary

Department of Natural Resources

and Environmental Control

* Proposed Regulation 25.

TIDAL FINFISH REGULATION 25. ATLANTIC SHARKS;

A) Definitions

1) Fillet means to remove slices of fish flesh, of irregular size and
shape, from the carcass by cuts made parallel to the backbone.

2) Large coastal sharks species means any of the species, or a part
thereof, listed in paragraph (a) of the definition of management unit.

3) Land or Landing shall mean to put or cause to go on shore from a vessel.

4) Management Unit means any of the following species in the Western
Atlantic Ocean, Delaware's Territorial Sea or tidal waters of Delaware:

(a) Large coastal species:

Hammerhead sharks-- Sphyrnidae

Great hammerhead, Sphyrna mokarran

Scalloped hammerhead, Sphyrna lewini

Smooth hammerhead, Sphyrna zyqaena

Mackerel sharks--Lamnidae

White shark, Carcharodon carcharias

Nurse sharks--Ginglymostomatidae

Nurse shark, Ginglymostoma cirratum

Requiem sharks--Carcharhinidae

Bignose shark, Carcharhinus altimus

Blacktip shark, Carcharhinus limbatus

Bull shark, Carcharhinus leucas

Caribbean reef shark, Carcharhinus perezi

Dusky shark, Carcharhinus obscurus

Galapagos shark, Carcharhinus galapaqensis

Lemon shark, Neqaprion brevirostris

Narrowtooth shark, Carcharhinus brachyurus

Night shark, Carcharhinus siqnatus

Sandbar shark, Carcharhinus plumbeus

Silky shark, Carcharhinus falciformis

Spinner shark, Carcharhinus brevipinna

Tiger shark, Galeocerdo cuvieri

(b) Small coastal species:

Angel sharks--Squatinidae

Atlantic angel shark, Squatina dumerili

Hammerhead sharks--Sphyrnidae

Bonnethead, Sphyrna tiburo

Requiem sharks--Carcharhinidae

Atlantic sharpnose shark, Rhizoprionodon
terraenovae

Blacknose shark, Carcharhinus acronotus

Caribbean sharpnose shark, Rhizoprionodon porosus

Finetooth shark, Carcharhinus isodon

Smalltail shark, Carcharhinus porosus

(c) Pelagic species:

Cow sharks--Hexanchidae

Bigeye sixgill shark, Hexanchus vitulus

Sevengill shark, Heptranchias perlo

Sixgill shark, Hexanchus griseus

Mackerel sharks--Lamnidae

Longfin mako, Isurus paucus

Porbeagle shark, Lamna nasus Shortfin mako, Isurus oxyrinchus

Requiem sharks--Carcharhinidae

Blue shark, Prionace qlauca

Oceanic whitetip shark, Carcharhinus longimanus

Thresher sharks--Alopiidae

Bigeye thresher, Alopias superciliosus

Thresher shark, Alopias vulpinus

(d) Prohibited species:

Basking sharks--Cetorhinidae

Basking shark, Cetorhinidae maximus

Mackerel sharks--Lamnidae

White shark, Carcharodon carcharias

Sand tiger sharks--Odontaspididae

Bigeye sand tiger, Odontaspis noronhai

Sand tiger, Odontaspis taurus

Whale sharks--Rhincodontidae

Whale shark, Rhincodon typus

(5) Pelagic species means any of the species, or a part thereof, listed in
paragraph (c) of the definition of management unit.

(6) Prohibited species means any of the species, or a part thereof, listed
in paragraph (d) of the definition of management unit.

(7) Small coastal species means any of the species, or part thereof, listed
in paragraph (b) of the definition of management unit.

(B) Prohibitions

1) It shall be unlawful for any person to fish for, purchase, trade,
barter, or possess or attempt to fish for, purchase, trade, barter, or
possess a prohibited species.

2) It shall be unlawful for any person to remove the fins from any shark in
the management unit and discard the remainder prior to landing said shark.

3) It shall be unlawful for any person to fillet a shark in the management
unit except that a shark may be eviscerated and the head and fins removed
prior to landing said shark.

4) It shall be unlawful to release any shark in the management unit in a
manner that will not ensure maximum probability of survival.
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5) It shall be unlawful for the operator of any vessel without a commercial
food fishing license to have on board said vessel more than two sharks in
the management unit except that two Atlantic sharpnose sharks also may be
on board.

6) It shall be unlawful for any person who has been issued a valid
commercial food fishing license while on board any vessel to possess any
large coastal shark, any small coastal shark or any pelagic shark in the
management unit during the remainder of any period after the effective date
a commercial quota for that group of sharks has been reached in said period
or is projected to be reached in said period by the National Marine
Fisheries Service, National Oceanic and Atmospheric Administration, U.S.
Department of Commerce and published in the Federal Register.

Bonnethead, Sphyrna tiburo

Atlantic sharpnose shark, Rhizoprionodon terraenovae

Blacknose shark, Carcharhinus acronotus

Caribbean sharpnose shark, Rhizoprionodon porosus

Finetooth shark, Carcharhinus isodon

Smalltail shark, Carcharhinus porosus

(6) Pelagic species shall mean any of the following species of sharks or
parts thereof:

Bigeye sixgill shark, Hexanchus vitulus

Sevengill shark, Heptranchias perlo

Sixgill shark, Hexanchus griseus

Longfin mako, Isurus paucus

Porbeagle shark, Lamna nasus

Shortfin mako, Isurus oxyrinchus

Blue shark, Prionace qlauca

Oceanic whitetip shark, Carcharhinus longimanus

Bigeye thresher, Alopias superciliosus

Thresher shark, Alopias vulpinus

(7) Prohibited species shall mean any of the following species of sharks or
parts thereof:

Basking shark, Cetorhinidae maximus

White shark, Carcharodon carcharias

Bigeye sand tiger, Odontaspis noronhai

Sand tiger, Odontaspis taurus

Whale shark, Rhincodon typus

(b) It shall be unlawful for any person to land, purchase, trade, barter,
or possess or attempt to land, purchase, trade, barter, or possess a
prohibited species.

(c) It shall be unlawful for any person to possess the fins from any shark
in the management unit prior to landing sand shark unless said fins are
naturally attached to the body of said shark.

(d) It shall be unlawful for any person to fillet a shark in the management
unit prior to landing said shark. A shark may be eviscerated and the head
removed prior to landing said shark.

(e) It shall be unlawful to release any shark in the management unit in a
manner that will not ensure said sharks maximum probability of survival.

(f) It shall be unlawful for the operator of any vessel without a
commercial food fishing license to have on board said vessel more than two
sharks in the management unit except that two Atlantic sharpnose sharks
also may be on board.

(g) It shall be unlawful for any person who has been issued a valid
commercial food fishing license while on board any vessel to possess any
large coastal shark, any small coastal shark or any pelagic shark in the
management unit during the remainder of any period after the effective date
a commercial quota for that group of sharks has been reached in said period
or is projected to be reached in said period by the National Marine
Fisheries
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* Final Regulation 25

TIDAL FINFISH REGULATION 25. ATLANTIC SHARKS

(a) Definitions:

(1) Fillet shall mean to remove slices of fish flesh, of irregular size and
shape, from the carcass by cuts made parallel to the backbone.

(2) Land or Landing shall mean to put or cause to go on shore from a
vessel.

(3) Management Unit shall mean any of the large coastal species, small
coastal species, pelagic species and prohibited species of sharks or parts
thereof defined in this regulation.

(4) Large coastal species shall mean any of the following species of sharks
or parts thereof:

Great hammerhead, Sphyrna mokarran

Scalloped hammerhead, Sphyrna lewini

Smooth hammerhead, Sphyrna zyqaena

White shark, Carcharodon carcharias

Nurse shark, Ginglymostoma cirratum

Bignose shark, Carcharhinus altimus

Blacktip shark, Carcharhinus limbatus

Bull shark, Carcharhinus leucas

Caribbean reef shark, Carcharhinus perezi

Dusky shark, Carcharhinus obscurus

Galapagos shark, Carcharhinus galapaqensis

Lemon shark, Neqaprion brevirostris

Narrowtooth shark, Carcharhinus brachyurus

Night shark, Carcharhinus siqnatus

Sandbar shark, Carcharhinus plumbeus

Silky shark, Carcharhinus falciformis

Spinner shark, Carcharhinus brevipinna

Tiger shark, Galeocerdo cuvieri

(5) Small coastal species shall mean any of the following species of sharks
or parts thereof:

Atlantic angel shark, Squatina dumerili
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Service, National Oceanic and Atmospheric Administration and the U.S.
Department of Commerce.

(h) It shall be unlawful for any person to engage in a directed commercial
fishery for a prohibited species.

Section 2. CONSERVATION STATEMENT

This Tidal Finfish Regulation No. 25 will have a significant impact on the
conservation of Atlantic Sharks.

Section 3. This Tidal Finfish Regulation No. 25 shall become effective on
January 31, 1998.
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Symbol Key

Roman type indicates the text existing prior to the regulation being
promulgated. Underlined text indicates new text. Language which is striken
through indicates text being deleted.

Proposed Regulations

Under 29 Del.C. §10115 whenever an agency proposes to formulate, adopt,
amend or repeal a regulation, it shall file notice and full text of such
proposals, together with copies of the existing regulation being adopted,
amended or repealed, with the Registrar for publication in the Register of
Regulations pursuant to §1134 of this title. The notice shall describe the
nature of the proceedings including a brief synopsis of the subject,
substance, issues, possible terms of the agency action, a reference to the
legal authority of the agency to act, and reference to any other
regulations that may be impacted or affected by the proposal, and shall
state the manner in which persons may present their views; if in writing,
of the place to which and the final date by which such views may be
submitted; or if at a public hearing, the date, time and place of the
hearing. If a public hearing is to be held, such public hearing shall not
be scheduled less than 20 days following publication of notice of the
proposal in the Register of Regulations. If a public hearing will be held
on the proposal, notice of the time, date, place and a summary of the
nature of the proposal shall also be published in at least 2 Delaware
newspapers of general circulation; The notice shall also be mailed to all
persons who have made timely written requests of the agency for advance
notice of its regulation-making proceedings.
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DEPARTMENT OF ADMINISTRATIVE SERVICES

DIVISION OF PROFESSIONAL REGULATION

BOARD OF EXAMINERS OF PSYCHOLOGISTS

PROPOSED RULES AND REGULATIONS

Statutory Authority: Title 24, Section 3506 (a)(1) of the Delaware Code (24
Del. C. Section 3506(a)(1))

department of administrative services

Division of Professional Regulation

Delaware Board of Examiners of Psychologists

Statutory Authority: 24 Delaware Code,

Section 3506(a)(1) (24 Del.C. 3506(a)(1))

DELAWARE BOARD OF EXAMINERS OF PSYCHOLOGISTS

NOTICE OF PUBLIC HEARING

PLEASE TAKE NOTICE, pursuant to 29 Del. C. Chapter 101 and 24 Del. C.
Section 3506(a)(1), the Delaware Board of Examiners of Psychologists
proposes to repeal the existing Rules and Regulations and adopt the new
Rules and Regulations. The regulations will define the official board
office, meetings of the board, officers of the board, procedures for
licensure, evaluation of credentials, supervised experience, failure to
pass examination, psychological assistants, continuing education,
professional conduct, complaint procedures, license renewal and procedures
for licensure applicable to full-time faculty members in a nationally
accredited doctoral level clinical training program in the State of
Delaware.

A public hearing will be held on the proposed Rules and Regulations on
March 9, 1998 at 9:30 a.m. in the Second Floor Conference Room A of the
Cannon Building, 861 Silver Lake Boulevard, Dover, Delaware. The Board will
receive and consider input from interested persons on the proposed rules
and regulations, and individuals are urged to submit their comments in
writing. Anyone wishing to obtain a copy of the proposed regulations, or to
make comments at the public hearing, should contact the Board's
Administrative Assistant Gayle Franzolino by calling (302) 739-4522 Ext.
220, or write to the Delaware Board of Examiners of Psychologists, P. O.
Box 1401, Cannon Building, Suite 203, Dover, DE 19903.
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SECTION 01 - GENERAL RULES AND REGULATIONS

The Board of Examiners of Psychologists has been established under the
Delaware law, Title 24, Chapter 35, and current amendments to that Law.
Within the framework of the Law, the Board has the responsibility for
interpreting and implementing the legal provisions and requirements of the
Law through the establishment of operating Rules and Regulations. The Board
and the public may propose changes in the Rules and Regulations in
accordance with the Administrative Procedures Act, Del.C., Title 29,
Chapter 101.

SECTION 02 - OFFICIAL BOARD OFFICE

The official office of the Board of Examiners shall be in Dover in the
Division of Professional Regulation and all correspondence must be
addressed to this office in written form before official action can be
taken. In addition, the Division of Professional Regulation will provide an
Administrative Assistant who will take notes at Board meetings, keep the
records for the Board, and serve as a liaison between the Board and members
of the public who have questions for the Board. The Division of
Professional Regulation will also set fees to defray the cost of
regulation.

SECTION 03 - MEETINGS OF THE BOARD

The Board will hold such meetings during the year as it may deem necessary
to review licensure applications and psychological assistant applications,
evaluate continuing education, hold disciplinary hearings, or conduct other
Board business. Either the President, or the majority of the Board may call
a Board meeting. The Division of Professional Regulation Board members, and
the public shall be notified of the meeting agenda, time and location in
accordance with the Freedom of Information Act.

SECTION 04 - OFFICERS OF THE BOARD

The Board elects its own officers at the first meeting of each calendar
year. The President of the Board sets the agendas of the meetings, chairs
meetings, and represents the Board at state regulatory meetings, the
American Association of State and Provincial Psychology Boards, and other
organizations that may interface with the Board unless someone else is
designated to attend in place of the President. The Vice President or
Secretary acts for the President in the President's absence. The Secretary
of the Board, in conjunction with the Administrative Assistant from the
Division of Professional Regulation, is responsible for taking care of
Board correspondence.

SECTION 05 - PROCEDURES FOR LICENSURE

APPLICATION - INITIAL LICENSURE

An applicant who is applying for licensure as a psychologist shall submit
evidence showing that he/she meets the requirements of 24 Del. C. Section
3508. The applicant must submit the following:

1. An application for licensure, which shall include: a) Academic
credentials documented by official transcripts showing completion of an
educational program meeting the requirements of 24 Del. C. Section
3508(a)(1).

b) Supervised experience documented by having each supervisor complete a
Supervisory Reference Form.

c) Evidence that the applicant passed the written "Examination for
Professional Practice in Psychology", developed by the Association of State
and Provincial Psychology Boards (ASPPB), by achieving the passing score
recommended by the ASPPB at the time of the application for licensure.
Candidates who are not licensed in any other state must have passed the
written examination within five (5) years of application for licensure in
Delaware.

d) Verification that the applicant has no past or pending disciplinary
proceedings. [24 Del. C. Section 3508(a)(4)]

The application shall not be considered complete until all materials are
received by the Board for review at an officially scheduled meeting. The
applicant will have twelve (12) months from the date of initial submission
of the application and fee to complete the application process.

2.Completed certification form. The applicant will be notified, once
his/her application is complete and available for the Board's review. The
certification form must be submitted before any further action can be
taken.

APPLICATION - BY RECIPROCITY

An applicant who is applying for licensure as a psychologist by
reciprocity, as defined in 24 Del. C. Section 3511, shall submit evidence
that he/she meets the following requirements:

1. An application for licensure, which shall include:

a) Evidence that the applicant is licensed or certified in another state
and that the applicant has practiced continuously, as a doctoral-level
psychologist, in good standing in that jurisdiction for two (2) years.

b) Evidence that the applicant passed the written Examination for
Professional Practice of Psychology (EPPP) by achieving the passing
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score, as required by their state of original licensure.

2. Completed certification form. The applicant will be notified once
his/her application is complete and available for the Board's review. The
certification form must be submitted before any further action can be
taken.

SECTION 06 - EVALUATION OF CREDENTIALS

Candidates for licensure as psychologists in the State of Delaware shall:

1. Have received a doctoral degree based on a program of studies, which is
psychological in content and specifically designed to train and prepare
psychologists. The doctoral degree must be from a college or university,
accredited as required by 24 Del. C. Section 3508(a)(1), having a graduate
program which states its purpose to be the training and preparation of
psychologists. Candidates holding degrees from programs outside the United
States or its territories are responsible for providing verification from
an agency recognized by the Board that their training and degree are
equivalent to US accredited programs; and

2. Have had, after receiving the doctoral degree, at least 2 years of
supervised professional experience in psychological work satisfactory to
the Board; and

3. Have achieved the passing score on the written standardized Examination
for Professional Practice in Psychology (EPPP) developed by the Association
of State and Provincial Psychology Boards (ASPPB), or its successor, or

4. The Board will qualify for licensing without examination any person who
applied for licensure and who is a diplomate of the American Board of
Professional Psychology. All such applicants must meet all other
requirements for licensure.

SECTION 07 - SUPERVISED EXPERIENCE

The types of supervision pertinent to licensure as a psychologist or
registration as a psychological assistant comprises of three types of
supervisory experiences:

1. Predoctoral internship supervision as required by doctoral programs in
psychology. The predoctoral internship consists of a minimum of 1,500 hours
of actual work experience completed in not less than 48 weeks, nor more
than 104 weeks. At least 50% of the predoctoral supervised experience must
be in clinical services such as treatment, consultation, assessment, report
writing, with at least 25% of that time devoted to face-to-face direct
patient/client contact. No more than 25% of time shall be allocated for
research.

2. Postdoctoral supervision is required for initial licensure as a
psychologist. Post doctoral experience must consist of 3,000 hours of
actual work experience.
This experience is to be completed in not less than two years and not more
than three calendar years, save for those covered under Section 3519(e).
For those individuals the accrual of 3,000 hours of supervised postdoctoral
experience must take place within six calendar years from the time of hire.
There is to be one hour of face-to-face supervision for every 1-10 hours of
clinical work. This experience shall consist of at least twenty five
percent and not more than sixty percent of the time devoted to direct
service per week in the area of the applicant's academic training. Not more
than 25% of this supervision can be done by other licensed mental health
professionals besides psychologists.

3. Supervision of psychological assistants is required at the frequency of
one hour of face-to-face supervision for every 1-10 hours of clinical work
by the psychological assistants, as required by Section 9 of the Rules and
Regulations.

A psychologist providing either postdoctoral supervision or supervision of
psychological assistants must have been in practice for two years post
licensure in this or any other state without having been subject to any
disciplinary actions.

A supervising psychologist of the postdoctoral experience of psychological
assistant must provide 24 hour availability to both supervisee and the
supervisee's clients, or adequate coverage is provided in supervisor's
absence.

This supervising psychologist shall have sufficient knowledge of all
clients including face-to-face contact when necessary.

The supervising psychologist must be employed or under contract in the
setting where the clinical service takes place and that the supervision
must occur within that setting.

SECTION 08 - FAILURE TO PASS EXAMINATION

Applicants may take the Examination for the Professional Practice in
Psychology as many times as they choose. Intervals between testing will be
determined by the testing agency and the ASPPB.

SECTION 09 - PSYCHOLOGICAL ASSISTANTS

A psychological assistant is an individual who meets the requirements of 24
Del. C. Section 3509(2a-2e). Psychological assistants are supervised,
directed, and evaluated by a Delaware licensed psychologist who assumes
professional and legal responsibility for the
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services provided. Any Delaware licensed psychologist who has had at least
two (2) years of experience following the granting of the licensure in this
or in any other state may supervise a maximum of two (2) full-time
psychological assistants or their part-time equivalents. Full time is
defined as twenty (20) hours of direct clinical service per week. The total
number of clinical hours that the Delaware licensed psychologist may
supervise is forty (40) per week divided among no more than four (4)
psychological assistants. The maximum number of clinical hours delivered by
a psychological assistant is limited to twenty (20) per week under any one
supervising psychologist. It is the responsibility of the supervising
psychologist in conjunction with the psychological assistant to diagnose
and form treatment plans for patients seen by the psychological assistant
and to file such plan in the patient/client's chart. The patient/client
must be informed that services are being delivered by a psychological
assistant and that the licensed psychologist is responsible for the
treatment. The patient/client shall sign a statement of informed consent
attesting that he/she understands that the services are being delivered by
a psychological assistant and that the licensed psychologist is ultimately
responsible for his/her treatment. This document shall include the
supervising psychologist's name and the telephone number where he/she can
be reached. One copy shall be filed with the patient/client's record and
another given to the patient.

The Delaware licensed psychologist is identified as the legally and
ethically responsible party in all advertising, public announcements, and
billings. In addition, billings and advertisements will clearly indicate
that the service is being provided by a psychological assistant. All
treatment and evaluation reports prepared by the psychological assistant
must be signed by the psychologist and the psychological assistant.

The Delaware licensed psychologist who accepts the responsibility of using
a psychological assistant shall develop and maintain a current, written job
description delineating the range and type of duties, educational practicum
and clinical experience to be assigned to the psychological assistant,
limits of independent action, emergency procedures for contacting the
supervising psychologist, and the amount and type of supervision to be
provided. This job description must be signed by the psychologist and the
psychologist assistant and will be filed in the Division of Professional
Regulation, along with an official copy of the psychological assistant's
college transcript, and proof of a 450-hour clinical practicum supervised
by a licensed psychologist or by a faculty member in a nationally
accredited doctoral level clinical training program in the State of
Delaware who is
actively pursuing licensure. The psychological assistant will also provide
a statement under oath as outlined in 24 Del. C. Section 3509 (b1- b3).

The Board will then review credentials, job description and supervisory
arrangements, and if the arrangements are acceptable, will inform the
psychologist in writing that the psychological assistant can begin work. No
psychological assistant shall begin work until the Board has approved the
application. Registration for psychological assistants expire biennially
and continued performance of the duties of a psychological assistant
requires proof of twenty (20) hours of continuing education and payment of
the renewal fee.

Supervision of the psychological assistant by the Delaware licensed
psychologist is to be a regular and formal process. It is required that the
licensed psychologist and the psychological assistant have weekly
one-on-one, face-to-face supervision with review of each case served by the
psychological assistant. The supervising psychologist should be familiar
with each patient/client seen by the psychological assistant and with the
ongoing progress of treatment. One hour of supervision for every ten hours,
or fraction thereof, of direct clinical work by the psychological assistant
is required as a minimum. For example, if a psychological assistant
provides eight (8) hours of direct clinical service, he or she must receive
a minimum of one (1) hour of supervision. Likewise, a psychological
assistant, who has fifteen (15) hours of direct clinical contact, must
receive at least two (2) hours of supervision. This supervision must be
documented in writing on patient records. In addition, the supervising
psychologist shall submit at the time of relicensure and at the termination
of the supervision relationship a supervision report on a form provided by
the Board which will become a part of the public record. It will contain
information describing the date and amount of supervision and any
unscheduled supervisory contact, as well as a brief assessment of the
psychological assistant's functioning.

Psychological assistants are to work in the office of the licensed
psychologist so as to have regular and continued supervision. When the
licensed psychologist is not in the office , he or she is expected to
provide clear contingency plans for consultation for the psychological
assistant. It is assumed that the psychologist will be available to the
psychological assistant under most circumstances; therefore, arrangements
in which the supervising psychologist is employed full-time elsewhere will
not be approved, unless it can be demonstrated that there will be adequate
supervision and contingency coverage of the psychological assistant.
Supervising
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psychologists will be expected to describe in their application for the
psychological assistant how much supervision they will provide and how that
supervision will be provided.

Psychological assistants who work for agencies must be supervised by a
psychologist employed by or under contract to the agency. Supervision must
occur on site, and the agency must have clearly spelled out plans for
providing consultation and backup when the supervising psychologist is not
on site. A psychological assistant who provides services that are under the
direction of different psychologists, must register as a psychological
assistant with all of the psychologists who are directly supervising the
clinical work.

When there is a complaint of incompetent, improper, or unethical behavior
on the part of the psychological assistant, in addition to the disciplinary
action against the psychological assistant, disciplinary action may be
taken against the supervising psychologist for failing to provide adequate
supervision of the psychological assistant. The Board reserves the right to
suspend or revoke the Delaware licensed psychologist's privilege of hiring
a psychological assistant when just cause has been established through a
formal hearing. Violation of this regulation may constitute cause for
suspending or revoking the privilege of hiring a psychological assistant.

Patients/clients are always the responsibility of the supervising
psychologist. Termination or transfer plans must be worked out with the
approval of the supervising psychologist. A psychological assistant will be
considered to be working for the supervising psychologist until the Board
of Examiners is notified in writing of the change in arrangements. The
letter terminating a psychological assistant arrangement must also specify
if the supervising psychologist is terminating the arrangement because of
concerns about the ethical or professional behavior of the psychological
assistant.

SECTION 10 - CONTINUING EDUCATION

1. Psychologists must obtain 40 hours of continuing education every two
years in order to be eligible for renewal of license. Psychologists will be
notified in January that he/she may submit their documentation beginning
March 1st. Continuing education credit must be submitted for the period of
August 1st of the year of renewal to July 31st of the second year.
Individuals licensed within the two year period will be notified by the
Board of the prorated amount to submit.

2. Psychological assistants must obtain 20 hours of continuing education
every two years for re-registration.
Psychological assistants may submit their documentation beginning March
1st. The appropriate period for credits to be accrued is from August 1st of
the year of renewal to July 31st of the second year. Psychological
assistants registered within the two year period will be notified by the
Board of the prorated amount to submit.

3. Psychologists or psychological assistants who have not submitted their
material by July 31st will be allowed, to reapply for licensure or
registration, until August 31st. In the situation where the appropriate
amount of documentation has been submitted in a timely fashion and in good
faith and with reasonable expectation of renewal, but has been found to be
inadequate, the practitioner has 30 days from the notification of
inadequacy to submit valid continuing education credit in the amount
specified, or until August 31st of that year, whichever is later.

4. It is the responsibility of the psychologist or psychological assistant
to file a record of his/her continuing education. Documentation of
continuing education will consist of letters/certificates of attendance
from the sponsoring entity.

5. The subject of the continuing education must contribute directly to the
professional competency of a person licensed to practice as a psychologist
or registered as a psychological assistant. The activity must have
significant intellectual or practical content and deal with psychological
techniques, issues or ethical standards relevant to the practice of
psychology.

6. Activities from APA-approved continuing education sponsors will be
automatically accepted. The following may be eligible:

a. Other programs which are not APA-approved sponsors but where the
material is relevant to professional practice and provides the equivalent
of APA-defined credit. An applicant must provide a brochure or other
documentation that supports the following criteria: relevance, stated
objectives, faculty and educational objectives, faculty and educational
objectives. To document attendance and completion, a certificate of
attendance is required. In these circumstances, hours will be accrued on
the basis of clock hours involved in the training.

b. Graduate courses relevant to professional practice taken for educational
credit offered by a regionally accredited academic institution of higher
education. Each credit hour of a course is equivalent to 5 CE hours.

c. Teaching an undergraduate or graduate level course in applied psychology
at an accredited institution. Teaching a 3 hour semester or quarter course
is considered the equivalent of 5 CE credit. No more than 5 CE credits may
be completed in this manner for any renewal period and can be submitted
only for the first time that a course is
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presented. Appropriate documentation of teaching must include the listing
of the course in the school catalog and a letter from the academic
institution stating that the course was taught.

d. Teaching of a workshop or conduction of a seminar on a topic of
pertinence to the practice of psychology. Credit earned for one day is a
maximum of 2 credits, two days is a maximum of 3 credits, and three days or
more is a maximum of 5 credits. However, credit can be earned only once for
teaching a particular seminar or workshop and not be eligible for
re-submission at any time. Appropriate documentation is considered to be
the brochure and demonstration of the workshop being held by the sponsoring
entity.

e. Authorship, editing or reviewing of a publication. Credit may be earned
only in the year of the publication and is limited to the following:

1) Author of a book (maximum of 40 CE hours)

2) Author of a book chapter or journal article (maximum of 15 CE hours)

3) Editor of a book (maximum of 25 CE hours)

4) Editor of or reviewer for a scientific or professional journal
recognized by the Board (maximum 25 CE hours)

Proof of the above must include the submission of the work or documentation
of authorship by copy of title pages.

f. Preparing and presenting a scientific or professional paper or poster at
a meeting of a professional or scientific or professional organization. Up
to 2 hours may be claimed for a poster presentation. Up to 3 hours of
credit may be claimed for each hour of paper presentation, with a maximum
of 8 CE hours per paper. Listing within the program and certificate letters
of attendance at the meeting is appropriate documentation for both a paper
or poster presentation.

7. The Board reserves the right to reject any CE program, if it is outside
the scope of the practice of psychology.

8. The following will not be considered for credit: service to
organizations; attending business meetings of professional organizations;
business management or office administration courses; group supervision; or
case conferences.

SECTION 11 - PROFESSIONAL CONDUCT

Psychologists and psychological assistants may be disciplined for
violations of provisions of 24 Del. C. Section 3514.

SECTION 12 - COMPLAINT PROCEDURES

Complaints against psychologists and psychological assistants will be
investigated as provided by 29 Del. C. Section 8807 and all hearings shall
be conducted in accordance with the Administrative Procedures Act, 29 Del.
C. Chapter 101.

Complaints must be filed, in writing, with the Division of Professional
Regulation.

SECTION 13 - LICENSE RENEWAL

Renewal notices will be mailed in a timely fashion to all psychologists and
psychological assistants who are currently licensed or registered.
Continuing education requirements must be fulfilled as detailed in Section
10 of the Rules and Regulations and submitted along with the established
fee for renewal to be approved. Should any psychologist fail to renew and
continue to make representation as a licensed psychologist beyond July
31st, that individual is practicing without a license. Should any
psychological assistant fail to renew and continue to make representation
as a registered psychological assistant beyond July 31st, that individual
is considered no longer to be registered, and his/her supervising
psychologist is in violation of the law.

SECTION 14 - PROCEDURES FOR LICENSURE APPLICABLE TO FULL-TIME FACULTY
MEMBERS IN A NATIONALLY ACCREDITED DOCTORAL LEVEL CLINICAL TRAINING PROGRAM
IN THE STATE OF DELAWARE

University faculty employed full-time in a nationally accredited doctoral
level clinical training program in the State of Delaware, as specified in
24 Del. C. Section 3519(e), who are not licensed, are subject to the
following rules and regulations:

1. Active Pursuit of Licensure. Such individuals are required to be in
active pursuit of licensure for a period not to exceed six years.

2. Professional Activities. These individuals may participate in and may
supervise matriculated graduate students in activities defined as the
practice of psychology within the context of a clinical training program,
and may conduct any research and teaching activities related to the
activities of such a program.

3. Registration. Such individuals must register with the Board of Examiners
of Psychologists no later than thirty days after the commencement of
employment, indicating employer, position, and dates.

The six-year time frame for the completion of licensure requirements
commences with the initial date of
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employment.

The six-year time frame for individuals employed as of June 12, 1995,
commenced on this date. These individuals must register with the Board no
later than thirty days after the enactment of these Rules and Regulations.

4. Education. Such individuals must have completed the doctoral degree at
the time employment commences, to be considered eligible to perform the
duties, as outlined in 24 Del. C. Section 3519(e).

5. Supervision. Such individuals must register a supervision plan with the
Board of Examiners of Psychologists which includes the nature of work and
the name of the supervisor. His/her plan must be acceptable to the Board,
as outlined in Section 07 of the Rules and Regulations, if not, the plan
must be revised accordingly. An affidavit signed by the supervisor must be
submitted in fulfillment of requirements for licensure.
Department of Administrative Services

Division of Professional Regulation

Delaware Real Estate Commission

Statutory Authority: 24 Delaware Code,

Section 2905 (24 Del.C. 2905)

DELAWARE REAL ESTATE COMMISSION

RULES AND REGULATIONS

TABLE OF CONTENTS

Section II

SECTIONS: PAGE

Introduction 1

Requirements for Obtaining

a Salesperson's License 3

Requirements for Obtaining a Real

Estate Broker's License 4

Reciprocal Licenses 6

Escrow Accounts 7

Transfer of Broker or Salesperson 8

Discipline of a Real Estate

Broker or Salesperson 9

Refund of Fees 10

Business Transactions and Practices 11

Renewal of Licenses 13

Inactive Status 14

Availability of Rules and Regulations 15

Disclosure 16

Hearings 18

Inducements 19

Necessity of License 20

Out of State Land Sales Applications

* Please note that the above page numbers refer to the original document,
not to pages in the Register.

For Revision Effective March 2, 1996

Table of Contents to be Revised to Reflect Revised Rules upon Adoption by
Commission

DELAWARE REAL ESTATE COMMISSION RULES AND REGULATIONS

I. INTRODUCTION

A. Authority

1. Pursuant to 24 Del. C. Section 2905, the Delaware Real Estate Commission
is authorized and empowered and hereby adopts the rules and regulations
contained herein.

2. The Commission reserves the right to make any amendments, modifications
or additions hereto, that, in its discretion are necessary or desirable.

3. The Commission reserves the right to grant exceptions to the
requirements of the rules and regulations contained herein upon a showing
of good cause by the party requesting such exception, provided such
exception is not inconsistent with the requirements of 24 Del. C. Chapter
29.

B. Applicability

The rules and regulations contained herein, and any amendments,
modifications or additions hereto are applicable to all persons presently
licensed as real estate brokers or real estate salespersons, and to all
persons who apply for such licenses.

C. Responsibility

1. It is the responsibility of the employing broker to insure that the
rules and regulations of the Commission are complied with by licensees.

2. Each office location shall be under the direction of a broker of record,
who shall provide complete and adequate supervision of that office. A
broker serving as broker of record for more than one office location within
the State shall apply for and obtain an additional license in his name at
each branch office. The application for such additional license shall state
the location of the branch office and the name of a real estate broker or
salesperson licensed in this State who shall be in charge of managing the
branch office on a full time basis.

A broker shall not serve as broker of record unless said broker has been
actively engaged in the practice of real es
tate, either as a licensed salesperson or a licensed broker, for the
preceding three (3) years.

Where an unforeseen event, such as a resignation or termination from
employment, death, emergency, illness, call to military service or
training, or a sanction imposed by the Commission causes or necessitates
the removal of the sole licensed broker in an office, arrangements may be
made with the Commission for another broker to serve as broker of record
for said office on a temporary basis.

The employment of a sales manager, administrative manager, trainer, or
other similar administrator shall not relieve the broker of record of the
responsibilities contained and defined herein.

3. The failure of any licensee to comply with the Real Estate Licensing Act
and the rules and regulations of the Commission may result in disciplinary
action in the form of a reprimand, civil penalty, suspension or revocation
of the broker's the and/or salesperson's individual's license.

II. REQUIREMENTS FOR OBTAINING A SALESPERSON'S LICENSE

The Commission shall consider any applicant who has successfully completed
the following:

A. Course

1. The Commission shall consider any applicant who has successfully
completed an accredited course in Real Estate Practice.

2. Effective May 1, 1978, all real estate courses shall be limited to
thirty-five (35) students in each class. This applies to both day and night
courses. All other regulations regarding real estate courses are issued
under "Guidelines for Fulfilling the Delaware Real Estate Continuing
Education Requirements Schools ". The Commission reserves the right to
grant exception to this limitation.

B. Examination

1. Within twelve (12) months of completing an accredited course, the
applicant must make application to the Commission by submitting a score
report showing successful completion of the examination required by the
Commission. The applicant must and forward all necessary documentation to
the Commission to be considered for licensure.

2. An applicant may sit for the examination a maximum of three (3) times
after successful completion of an approved course in real estate practice.
If an applicant fails to pass the examination after three (3) attempts at
such, the applicant shall be required to retake and successfully complete
an approved course in real estate practice before being permitted to sit
for the examination again.

C. Ability to conduct business

1. The Commission reserves the right to reject
an applicant based on his or her inability to transact real estate business
in a competent manner or if it determines that the applicant lacks a
reputation for honesty, truthfulness and fair dealings.

2. The minimum age at which a salesperson's license can be issued is
eighteen (18).

D. Fees

The Commission shall not consider an application for a salesperson's
license unless such application is submitted with evidence of payment of
the following fees:

1. Salesperson's application license fee established by the Division of
Professional Regulation pursuant to 29 Del. C. Section 8807(d)10(d) .

2. Processing fee established by the Division of Professional Regulation
pursuant to 29 Del. C. Section 8810(d).

3. Guaranty Fund fee established pursuant to 24 Del. C. Sec. 2921(b).

III. REQUIREMENTS FOR OBTAINING A REAL ESTATE BROKER'S LICENSE

The Commission shall consider the application of any person for a broker's
license upon completion of the following:

A. Course

1. The Commission shall consider the application of any person for a
license after said applicant has successfully completed an accredited
course.

2. Effective May 1, 1978, all courses shall be limited to thirty-five (35)
students in each class.

BA . Experience

1. A salesperson must hold an active license be actively working in the
real estate profession for five (5) continuous years immediately preceding
application continuously before he or she can apply for a broker's license.

2. The applicant shall submit to the Commission a list of at least thirty
(30) sales or other qualified transactions, showing dates, location,
purchaser's name and seller's name. Transactions involving time-shares,
leases, or property management are not qualified transactions for purposes
of obtaining a real estate broker's license . These sales must have been
made by the applicant within the previous five (5) years through the
general brokerage business and not as a representative of a builder,
developer, and/or subdivider. Transactions involving time-shares, leases,
or property management are not qualified transactions for purposes of
obtaining a real estate broker's license. The Commission reserves the right
to waive any of the above requirements, upon evidence that the applicant
possesses sufficient experience in the real estate business or demonstrates
collateral experience to the Commission.

3. The list of thirty (30) sales or other qualified transactions and/or the
variety of the licensee's experience must be approved by the Commission.
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B. Course

1. The Commission shall consider the application of any person for a
license after said applicant has successfully completed an accredited
course.

2. Effective May 1, 1978, all courses shall be limited to thirty-five (35)
students in each class.

C. Examination

Within twelve (12) months of completing an accredited course, the applicant
must submit a score report showing successful completion of the examination
required by the Commission and submit all necessary documentation including
the credit report required by Paragraph E of this rule to the Commission to
be considered for licensure.

D. Ability to conduct business

1. The Commission reserves the right to reject an applicant based on his or
her ability to transact real estate business in a competent manner or if it
determines that the applicant lacks experience, a reputation for honesty,
truthfulness and fair dealings.

2. The minimum age at which a person can be issued a broker's license is
twenty-three (23).

E. Credit Report

Each applicant shall submit a credit report from an approved credit
reporting agency, which report shall be made directly to the Commission.

F. Fees

The Commission shall not consider an application for a broker's license
unless such application is submitted with evidence of payment of the
following fees:

1. Broker's application license fee established by the Division of
Professional Regulation pursuant to 29 Del. C. Sec. 880710(d) .

2. Processing fee established by the Division of Professional Regulation
pursuant to 29 Del. C. Sec. 8810(d).

3. Guaranty Fund fee unless paid previously pursuant to 24 Del. C. Sec.
2921(b).

IV. RECIPROCAL LICENSES

A. Requirements

1. A non-resident of this State who is duly licensed as a broker in another
state and who is actually engaged in the business of real estate in the
other state may be issued a non-resident broker's license under 24 Del. C.
Sec. 2909(a).

2. A non- resident salesperson who is duly licensed as a salesperson in
another state and who is actually engaged in the business of real estate in
the other state may be issued a non-resident salesperson's license provided
such non-resident salesperson is employed by a broker holding a broker's
license issued by the Commission.

3. The Commission, at its discretion, may issue a non-resident broker's or
salesperson's license without the course and examination required by Rules
II.B. or III.C. provided the non-resident broker or salesperson
passed an equivalent course and examination in his/her resident state and
provided that such other state extends the same privilege to Delaware real
estate licensees.

V. ESCROW ACCOUNTS

A. All moneys received by a broker as agent for his principal in a real
estate transaction shall be deposited within three (3) banking days after a
contract of sale or lease has been signed by both parties, in a separate
escrow account so designated, and remain there until settlement or
termination of the transaction at which time the broker shall make a full
accounting thereof to his or her principal.

B. All moneys received by a salesperson in connection with a real estate
transaction shall be immediately delivered to the appropriate broker.

C. A broker shall not co-mingle money or any other property entrusted to
him with his money or property, except that a broker may maintain up to
$100.00 of his/her own funds in a specific amount of his own funds from
$25.00 to $100.00 in the escrow account to cover bank service charges and
to maintain the minimum balance necessary to avoid the account being
closed.

D. A broker shall maintain in his office a complete record of all moneys
received or escrowed on real estate transactions, including the sources of
the money, the date of receipt, depository, and date of deposit; and when a
transaction has been completed, the final disposition of the moneys. The
records shall clearly show the amount of the broker's personal funds in
escrow at all times.

E. An escrow account must be opened by the broker in a Delaware bank with
an office located in Delaware in order to receive, maintain or renew a
valid license.

F. The Commission may summarily suspend (upon hearing) the license of any
broker who fails to comply with Paragraph D, who fails to promptly account
for any funds held in escrow, or who fails to produce all records, books,
and accounts of such funds upon demand. The suspension may be immediate and
shall continue until such time as the licensee appears for a hearing and
furnishes evidence of compliance with the Rules and Regulations of the
Commission.

G. Interest accruing on money held in escrow belongs to the owner of the
funds unless otherwise stated in the contract of sale or lease.

VI. TRANSFER OF BROKER OR SALESPERSON

A. All licensees who transfer to another office, or brokers who open their
own offices, but who were associated previously with another broker or
company, must present a completed transfer form to the Commission signed by
the individual broker or company with whom they were formerly associated,
before the broker's or salesperson's license will be transferred. In
addition all brokers who are non-resident licensees must also provide a
current certificate of licensure.
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B. The Commission reserves the right to waive this requirement upon a
determination of good cause.

C. All brokers of record who move the physical location of their office
shall notify the Commission in writing at least 30 days, or as soon as
practical, prior to such move by filing a new office application.

VII. DISCIPLINE OF A REAL ESTATE BROKER OR SALESPERSON

A. In such circumstances, when it becomes necessary to discipline a
licensee, the Commission shall follow the procedures set forth in these
Rules and Regulations and the Administrative Procedures Act under Title 29,
Section 6401-6434.

VIII. REFUND OF FEES

No refund of fees shall be made to any applicant who fails to qualify for a
license or who requests a change in status after a renewal has been issued.

IX. BUSINESS TRANSACTIONS AND PRACTICES

A. Written Listing Agreements

Listing Agreements for the rental, sale, lease or exchange ofr real
property, whether exclusive, co-exclusive or open shall be in writing and
shall be signed by the seller or owner.

B. Copy of agreements

Every party to a listing agreement, agreement of purchase and sale, or
lease shall be furnished with an executed copy of such contract or
contracts. It shall be the responsibility of the licensee to deliver an
executed copy of the agreements to the principals within a reasonable
length of time after execution.

C. Advertising

1. Any licensee who advertises, on signs, newspapers or any other media,
property personally owned and/or property in which a licensee has any
ownership interest, and said property is not listed with a broker, must
include in the advertisement that he/she is the owner of said property and
that he/she is a real estate licensee.

2. Any licensee who advertises in newspapers or any other media, property
personally owned and/or property in which the licensee has any ownership
interest, and said property is listed with a broker, must include in the
advertisement the name of the broker under whom he/she is licensed, that
he/she is the owner of said property, and that he/she is a real estate
licensee. This subsection does not apply to signs.

3. Any licensee who advertises, by signs, newspaper, or any other media,
any property for sale, lease, exchange, or transfer that is listed with a
broker must include in the advertisement the name of the broker under whom
the licensee he/she is licensed.

4. All advertisements for personal promotion of
licensees must include the name of the cC ompany under whom the licensee is
licensed.

5. Size, dimension, proportion, and prominence of licensee's name and
company's and/or broker's name referred to in paragraph 2, 3, and 4 of this
subsection shall be subject to the Broker-of-Record approval.

D. Separate Office

1. Applicants for broker's licenses and those presently licensed must
maintain separate offices in which to conduct the real estate business.
Nothing contained herein, however, shall preclude said persons from sharing
facilities with such other businesses as insurance, banking, or others that
the Commission shall deem compatible.

2. Where the office is located in a private home, said office must have a
separate entrance and must be approved by the Commission. The broker must
place a permanent sign indicating the name under which the office is
licensed, in a conspicuous location.

E. Compensation

1. Licensees shall not accept compensation from more than one party to a
transaction, even if permitted by law, without timely disclosure to all
parties to the transaction.

2. When acting as agent, a licensee shall not accept any commission,
rebate, or profit on expenditures made for his principal-owner without the
principal's knowledge and informed consent.

F. Duty to Cooperate

Brokers and salespersons shall cooperate with all other brokers and
salespersons involved in a transaction except when cooperation is not in
the client's best interest. The obligation to cooperate does not include
the obligation to share commissions or to otherwise compensate another
broker or salesperson.

X. RENEWAL OF LICENSES

A. Renewal Required by Expiration Date on License July 1

In order to qualify for license renewal as a real estate salesperson or
broker in Delaware, a licensee shall have completed 15 hours of continuing
education within the two year period immediately preceding the renewal. The
broker of record for the licensee seeking renewal shall certify to the
Commission, on a form supplied by the Commission, that the licensee has
complied with the necessary continuing education requirements. This
certification form shall be submitted by the licensee together with his/her
renewal application and renewal fee. The broker of record shall retain for
a period of one (1) year, the documents supporting his/her certification
that the licensee has complied with the continuing education requirement. A
licensee who has not paid the fees and/or met the requirements for the
renewal of his or her license by the expiration date shown thereon July 1 ,
shall not list, sell, lease or negotiate for oth
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ers after such date.

B. Delinquency Fee

1. If a licensee fails to renew his or her license prior to the expiration
date shown thereon July 1 , he or she shall be required to pay the full
license fee and an additional delinquency fee (amount equal to one half of
the yearly license fee) delinquency fee . If a licensee fails to renew his
or her license within 60 days of the expiration date shown thereon before
September 1 , the license shall be cancelled.

2. Failure to receive notice of renewal by a licensee shall not constitute
a reason for reinstatement.

C. Reinstatement of License

1. A cancelled license shall be reinstated only after the licensee pays the
necessary fees, including the delinquency fee, and passes any examinations
required by the Commission. If the licensee fails to apply for renewal
within 6 months of the cancellation date by March 1 of the next year , the
licensee shall be required to take the state portion of the examination. to
be reinstated. If the licensee fails to apply for renewal before the next
renewal period commences (two years), the licensee shall be required to
pass both the state and the national portions of the examination.

2. No person whose license has been revoked will be considered for the
issuance of a new license for a period of at least two (2) years from the
date of the revocation of the license. Such person shall then fulfill the
following requirements: he or she shall attend and pass the real estate
course for salespersons; take and pass the Commission's examination for
salespersons; and any other criteria established by the Commission.,
including the submission of three (3) letters of character reference,
stating that such individual is of good moral character. Nothing above
shall be construed to allow anyone to take the course for the purpose of
licensing until after the waiting period of two (2) years. Nothing
contained herein shall require the Commission to issue a new license upon
completion of the above mentioned requirements, as the Commission retains
the right to deny any such application.

D. Certification of Continuing Education

The broker of record shall certify to the Commission, on a form supplied by
the Commission, at the time of license renewal that all licensees in
his/her office have complied with the necessary continuing education
requirements. This certification form shall be submitted by the licensee
together with their renewal application and fee. The broker of record shall
retain for a period of one (1) year, the documents supporting his/her
certification that the licensee has complied with the continuing education
requirement.

XI. INACTIVE STATUS

Upon the payment of a fee established by the Division of Professional
Regulation, the Commission may place any licensee on inactive status for a
period not to exceed two
(2) years.

XII. AVAILABILITY OF RULES AND REGULATIONS

A. Fee Charge for Primers

Since licensees are required to conform to the Commission's Rules and
Regulations and the Laws of the State of Delaware, these Rules and
Regulations shall be made available to licensees without charge. However,
in order to help defray the cost of printing, students in the real estate
courses and other interested parties may shall be required to pay such fee
as stipulated by the Division of Professional Regulation for the booklet or
printed material. or such fee as stipulated by the Commission.

XIII. DISCLOSURE

A. A licensee who is the owner, the prospective purchaser, lessor or lessee
or who has any personal interest in a transaction, must disclose his or her
status as a licensee to ALL persons with whom he or she is transacting such
business, prior previous to the execution of any agreements and shall
include on the agreement such status. as a licensee on the agreement.

B. Buy-In-Disclosure

Any licensee advertising real estate for sale stating in such
advertisement, "If we cannot sell your home, we will BUY your home", or
words to that effect, shall disclose in the original listing contract at
the time he or she obtains the signature on the listing contract, the price
he will pay for the property if no sales contract is executed during the
term of the listing. Said licensee shall have no more than sixty (60) days
to purchase and settle for the subject property upon expiration of the
original listing or any extension thereof.

C. A licensee who has direct contact with a potential purchaser or seller
shall disclose in writing whom he/she represents in any real estate
negotiation or transaction. The Such disclosure as to whom the licensee
represents should shall be made at the 1st substantive contact to each
party to the negotiation or transaction. In all cases such disclosure must
be made whom licensee does not represent, but, in any event , prior to the
presentation of an offer to purchase. A written confirmation of disclosure
shall also be included in the contract for the real estate transaction.

The written confirmation of disclosure in the contract shall be worded as
follows:

With respect to agent for seller: "This broker, any cooperating broker, and
any salesperson working with either, are representing the seller's interest
and have fiduciary responsibilities to the seller, but are obligated to
treat all parties with honesty. The broker, any cooperating broker, and any
salesperson working with either, without breaching the fiduciary
responsibilities to the seller, may, among other services, provide a
potential purchaser with information
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about the attributes of properties and available financing, show
properties, and assist in preparing an offer to purchase. The broker, any
cooperating broker, and any salesperson working with either, also have the
duty to respond accurately and honestly to a potential purchaser's
questions and disclose material facts about properties, submit promptly all
offers to purchase and offer properties without unlawful discrimination."

With respect to agent for buyer: "This broker, and any salesperson working
for this broker, is representing the buyer's interests and has fiduciary
responsibilities to the buyer, but is obligated to treat all parties with
honesty. The broker, and any salesperson working for the broker, without
breaching the fiduciary responsibilities to the buyer, may, among other
services, provide a seller with information about the transaction. The
broker, and any salesperson working for the broker, also has the duty to
respond accurately and honestly to a seller's questions and disclose
material facts about the transaction, submit promptly all offers to
purchase through proper procedures, and serve without unlawful
discrimination."

In the case of a transaction involving a lease in excess of 120 days,
substitute the term "lessor" for the term "seller", substitute the term
"lessee" for the terms "buyer" and "purchaser", and substitute the term
"lease" for "purchase" as they appear above.

D. If a property is the subject of an agreement of sale but being left on
the market for backup offers, or is the subject of an agreement of sale
which contains a right of first refusal clause, the existence of such
agreement must be disclosed by the listing broker to any individual who
makes an appointment to see such property at the time such appointment is
made.

XIV. HEARINGS

A. When If a complaint is filed with the Commission against a licensee, the
status of the broker of record in that office shall not cannot change. the
status of his or her license until the pending case is settled .

B. There shall be a maximum of one (1) postponement for each side allowed
on any hearing which has been scheduled by the Commission. If any of the
parties are absent from a scheduled hearing, the Commission reserves the
right to act based upon the evidence presented.

XV. INDUCEMENTS

A. Real Estate licensees cannot use commissions or income received from
commissions as rebates or compensation paid to or given to NON-LICENSED
PERSONS, partnerships or corporations as inducements to do or secure
business, or as a finder's fee.

B. No licensee shall knowingly pay a commission, or other compensation to a
licensed person knowing that licensee will in turn pay a portion or all of
that which is re
ceived to a person who does not hold a real estate license.

XVI. NECESSITY OF LICENSE

A. For any property listed with a broker for sale, lease or exchange, only
a licensee shall be permitted to host or staff an open house or otherwise
show a listed property. That licensee may be assisted by non-licensed
persons provided a licensee is on site. This subsection shall not prohibit
a seller from showing their own house.

B. For new construction, subdivision, or development listed with a broker
for sale, lease or exchange, a licensee shall always be on site when the
site is open to the general public, except where a builder and/or developer
has hired a non-licensed person who is under the direct supervision of said
builder and/or developer for the purpose of staffing said project.

Add New Rule # OUT OF STATE LAND SALES APPLICATIONS

A. All applications for registration of an out of state land sale must
include the following:

1. A completed license application on the form provided by the Commission.

2. A $100 filing fee made payable to the State of Delaware.

3. A valid Business License issued by the State of Delaware, Division of
Revenue.

4. A signed Appointment and Agreement designating the Delaware Secretary of
State as the applicant's registered agent for service of process. The form
of Appointment and Agreement shall be provided by the Commission. In the
case of an applicant which is a Delaware corporation, the Commission may,
in lieu of the foregoing Appointment and Agreement, accept a current
certificate of good standing from the Delaware Secretary of State and a
letter identifying the applicant's registered agent in the State of
Delaware.

5. The name and address of the applicant's resident broker in Delaware and
a completed Consent of Broker form provided by the Commission. Designation
of a resident broker is required for all registrations regardless of
whether sales will occur in Delaware.

6. A bond on the form provided by the Commission in an amount equal to ten
(10) times the amount of the required deposit.

7. Copies of any agreements or contracts to be utilized in transactions
completed pursuant to the registration.

B. Each registration of an out of state land sale must be renewed on an
annual basis. Each application for renewal must include the items
identified in sub-sections 2 through 4 of Section A above and a statement
indicating whether there are any material changes to information provided
in the initial registration. Material changes may
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include, but are not limited to, the change of the applicant's resident
broker in Delaware; any changes to the partners, officers and directors'
disclosure form included with the initial application; and any changes in
the condition of title.

C. If, subsequent to the approval of an out of state land sales
registration, the applicant adds any new lots or units or the like to the
development, then the applicant must, within thirty days, amend its
registration to include this material change. A new registration statement
is not required, and the amount of the bond will remain the same.

Summary of Changes to the Rules and Regulations

I.C.3. - reworded to include "civil penalty" in the list of possible
disciplinary actions which may be taken by the Commission and to clarify
that brokers as well as salespersons may be held responsible for violations
by a salesperson.

II. - non substantive revision to clarify the application process for the
salesperson and to update reference to the statute in II.D.1.

III. - non substantive revision to clarify the application process for the
broker and to update reference to the statute in III.F.1.

V.C. - revised to clarify the language regarding the amount of the broker's
own funds which may be maintained in the escrow account to $ 100 maximum in
order to avoid the account being closed

V.E. - previous wording required that broker open an escrow account in a
"Delaware bank" now states "a bank with an office in Delaware"

V.F. - reword for clarity

VI.A. - revised to include the requirement that a current certificate of
licensure be provided by all nonresident brokers who are transferring a
license.

VI.C. - Added to require that a broker moving an office report the move to
the Commission in writing by filing a new office application 30 days prior
to opening the new office.

VII. was struck in its entirety.

VIII. was struck in its entirety.

IX.A. - Non substantive correction to "Listing Agreements for the rental,
sale, lease or exchange of real property,
whether exclusive, co-exclusive or open shall be in writing and shall be
signed by the seller or owner."

IX.B. - Non Substantive correction adding the word "the" to the last
sentence which now reads: "It shall be the responsibility of the licensee
to deliver an executed copy of the agreements to the principals within a
reasonable length of time after execution."

IX.C.3. - Non Substantive correction, was revised to replace "he/she" with
"the licensee".

IX.C.4. - Non Substantive revision to replace the capital "C" in "Company"
with a lower case "c" and to add the word "the" for readability as follows:
"All advertisements for personal promotion of licensees must include the
name of the company under whom the licensee is licensed.

IX.C.5 was struck in its entirety.

IX.D.2. - revised by adding the word "permanent" to enforce the requirement
of the statute regarding office signs in private home offices: "Where the
office is located in a private home, said office must have a separate
entrance and must be approved by the Commission. The broker must place a
permanent sign indicating the name under which the office is licensed, in a
conspicious location."

Add New Rule IX.E. - Clarifies the need for the licensee to disclose to all
parties any compensation from more than one party to a transaction that the
licensee intends to accept, and prohibits the licensee from accepting any
commission, rebate or profit on expenditures made for his principal-owner
without the principal's knowledge and informed consent.

Add New Rule IX.F. - Identifies the need for licensees to cooperate with
other licensees involved in a transaction except when such cooperation is
not in the best interest of a client. Further this obligation does not
imply any obligation to share commissions or otherwise compensate another
licensee.

X.A. - revised to include credit certification procedure for renewal, add
15 hours as the number of required continuing education credits for the
license renewal, and to accomodate change of expiration date.

X.B.1. - Revised to accommodate a change of expiration date and to clarify
the late fee payment process

X.C.1. - Revised for readibility and to accommodate a change of expiration
date.
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X.C.2. - Deleted requirement of three (3) letters of character reference,
stating that the applicant is of good moral character in compliance with 24
Del.C. §2907(a)(2).

X.D. - Rewritten into Rule X.A.

XI. - Deleted in its entirety.

XII.A. - Reword to clarify that the Division of Professional Regulation
sets fee for Primer.

XIII.A. - Revised for readibility.

XIII.C. - was revised for clarity.

XIV.A. - was revised for clarity.

XV. - Add language to prohibit payment of commission by a licensee to
another licensed person with the knowledge that all or a portion of the
payment will in turn be paid out or given to an unlicensed person.

XVI. - Non substantive change

XVI.B. - Non substantive change

Add New Rule Regarding Out of State Land Sales Applications - Outlines
requirements for initial applications and subsequent addition of units,
lots, etc.

Renumber all Rules and Subsections as necessary.

Department of Administrative Services

Division of Professional Regulation

Delaware Board of Medical Practice

Respiratory Care Practice

Adivsory Council

Statutory Authority: 24 Delaware Code,

Section 1770B(c)(5) (24 Del.C. 1770B(c)(5))

BEFORE THE RESPIRATORY CARE PRACTICE ADVISORY COUNCIL OF THE DELAWARE BOARD
OF MEDICAL PRACTICE

IN THE MATTER OF THE

ADOPTION OF RULES | RESPIRATORY CARE

AND REGULATIONS TO | PRACTICE ADVISORY

REGULATE THE | COUNCIL

PRACTICE OF | REGULATION

RESPIRATORY CARE | DOCKET NUMBER 1
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PLEASE TAKE NOTICE that the Respiratory Care Practice Advisory Council to
the Delaware Board of Medical Practice, pursuant to the authority of Title
24, Delaware Code, § 1770B(c)(5), has developed and proposes to promulgate
Rules and Regulations governing all aspects of the practice of Respiratory
Care by licensed respiratory care practitioners in the State of Delaware.

A public hearing will be held on the proposed Rules and Regulations on
Thursday, March 5, 1998, at 2:30 p.m., at the Cannon Building, 861 Silver
Lake Boulevard, conference room B, Dover, Delaware, 19901. The Council will
receive and consider input in writing from interested persons on the
proposed new Rules and Regulations. Final date to submit written comments
shall be at the above scheduled public hearing. Anyone wishing to obtain a
copy of the proposed Rules and Regulations or to make comments at the
public hearing should notify Rosey Vanderhoogt at the above address or by
calling (302) 739-4522 extension 203.

This notice will be published in two newspapers of general circulation not
less than twenty (20) days prior to the date of the hearing.

PROPOSED RULES AND REGULATIONS FOR THE PRACTICE OF RESPIRATORY CARE

Proposed by the Respiratory Care Practice Advisory Council of the Delaware
Board of Medical Practice

TABLE OF CONTENTS

SECTION 1 DEFINITIONS 1

SECTION 2 PURPOSE 1

SECTION 3 STANDARDS OF PRACTICE

FOR THE RESPIRATORY PRACTITIONER 2

SECTION 4 STANDARDS RELATED

TO THE RESPIRATORY CARE

PRACTITIONER'S COMPETENCE

AND RESPONSIBILITIES 2

SECTION 5 ADMINISTRATION OF

MEDICATIONS 3

SECTION 6 DISCIPLINARY PROCEEDINGS 4

SECTION 7 WORKING STUDENT

RESPIRATORY CARE PRACTITIONER 6

SECTION 8 CONTINUING EDUCATION 7

8.1 Contact hours required for renewal 7

8.2 Exemptions 7

8.3 Criteria for Qualification of

Continuing Education 8

8.3.1 Definition of Contact Hours 8

8.3.2 Learner Objectives 8

8.3.3 Subject Matter 8

8.3.4 Description 9

8.3.5 Types of Activities/Programs 9

8.4 Educational Providers 10

8.5 Accumulation of Continuing Education 10

8.6 Review/Approval of Continuing

Education Contact Hours 11

SECTION 9 RENEWAL OF LICENSE 11

SECTION 10 APPLICATION FOR A LICENSE 12

* Please note that the above page numbers refer to the original document,
not to pages in the Register.

STANDARDS OF RESPIRATORY CARE PRACTICE

SECTION 1: DEFINITIONS

1.1 "Board" - means Delaware Board of Medical Practice.

1.2 "Certified Respiratory Therapy Technician (CRTT)" - means the
credential awarded by the NBRC to individuals who pass the certification
examination for entry level respiratory therapy practitioners.

1.3 "Council" - means the Respiratory Care Practice Advisory Council of the
Board of Medical Practice.

1.4 "NBRC" means the National Board for Respiratory Care, Inc.

1.5 "Programs Approved by the Board" - means programs accredited by the
Joint Review Committee for Respiratory Therapy Education (JRCRTE) or its
successor organization which have been approved by the Board.

1.6 "Registered Respiratory Therapist (RRT)" - means the credential awarded
by the NBRC to individuals who pass the registry examination for advanced
respiratory therapy practitioners.

1.7 "Respiratory Care" - means treatment, management, diagnostic testing,
control and care of patients with deficiencies and abnormalities associated
with the cardiopulmonary system under the direction of a physician.
Respiratory care includes inhalation therapy and respiratory therapy under
Title 24, Delaware Code, Chapter 17. Medical Practices Act, § 1770B(a)(2).

1.8 "Respiratory Care Practitioner (RCP)" - means an individual who
practices respiratory care under Title 24, Delaware Code, Chapter 17.
Medical Practices Act, § 1770B(a)(1) and (7).

1.9 "Student Respiratory Care Practitioner (Student-RCP)" - means an
individual enrolled in an accredited Respiratory Care Program recognized
and approved by
the Board.

1.10 "Working Student Respiratory Care Practitioner" - means a student
respiratory care practitioner who is employed to perform respiratory care
under a limited scope of practice established by the Board.

1.11 "General Supervision" - means whether by direct observation and
monitoring, protocols approved by physicians, or orders written or verbally
given by physicians.

1.12 "Direct Supervision" - means supervising licensee or supervising
physician will be present and immediately available within the treatment
area.

SECTION 2: PURPOSE

2.1 The purpose of the standards is to establish minimal acceptable levels
of safe practice to protect the general public and to serve as a guide for
the Board to evaluate safe and effective practice of respiratory care.

SECTION 3: STANDARDS OF PRACTICE FOR THE RESPIRATORY CARE PRACTITIONER

3.1:a. The respiratory care practitioner shall conduct and document
respiratory care assessments of individuals and groups by various
appropriate means including but not limited to the following:

1. Collecting objective and subjective data from observations,
examinations, physiologic tests, interviews and written records in an
accurate and timely manner. 2. Sorting, selecting, reporting, and recording
the data.

3. Analyzing data.

4. Validating, refining and modifying the data by using available resources
including interactions with the patient, family, and health team members.

5. Evaluating data.

6. Respiratory care practitioners shall establish and document data that
serves as the basis for the strategy of care.

3.1:b. Respiratory care practitioners may develop strategies of care such
as a treatment plan.

3.1:c. Respiratory care practitioners may participate under the direction
and supervision of a physician in the implementation of patient care.

SECTION 4: STANDARDS RELATED TO THE RESPIRATORY CARE PRACTITIONER'S
COMPETENCE AND RESPONSIBILITIES
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4.1 Respiratory care practitioners shall:

a. Have knowledge of the statutes and regulations governing the practice of
respiratory care.

b. Accept responsibility for competent practice of respiratory care.

c. Obtain instructions and supervision from physicians.

d. Function as a member of a health care team by collaborating with other
members of the team to provide appropriate care.

e. Consult with respiratory care practitioners and others and seek guidance
as necessary.

f. Obtain instruction and supervision as necessary when implementing
respiratory care techniques.

g. Contribute to the formulation, interpretation, implementation and
evaluation of objectives and policies related to the practice of
respiratory care within the

employment setting.

h. Report unsafe respiratory care practice and conditions to the
Respiratory Care

Practice Advisory Council, (Council), or other authorities as appropriate.

i. Practice without unlawful discrimination as to age, race, religion, sex,
national

origin or disability.

j. Respect the dignity and rights of patients regardless of social or
economic status,

personal attributes or nature of health problems.

k. Respect patients' right-to-privacy by protecting confidentiality unless
obligated

by law to disclose the information.

l. Respect the property of patients and their families.

m. Teach safe respiratory care practice to other health care workers as
appropriate.

SECTION 5: ADMINISTRATION OF MEDICATIONS

5.1 Respiratory care practitioners may administer pharmacological agents,
aerosols, or medical gases via the respiratory route. Administration of
medication by routes other than the respiratory route require the direct
supervision of a physician.

5.2 A respiratory care practitioner shall not deliver any medication unless
the order, written or oral by a physician or other person authorized by the
Board of Medical Practice, to prescribe that class of medication includes:

a. Patient identification

b. Date of the order

c. Time of the order

d. Name of medication

e. Dosage

f. Frequency of administration

g. Route of administration

h. Method of administration

No respiratory care practitioner holding a permit or a license in the state
of Delaware may administer medications for the testing or treatment of
cardiopulmonary impairment for which the respiratory care provider is
untrained or incompetent.

5.3 Respiratory care practitioners must be able to document appropriate
training and proficiency on the route of medication delivery, drug
pharmacology, and dosage calculations for any cardiopulmonary medications
for which they are responsible to administer. Appropriate training includes
but is not limited to the following components:

a. Pharmacology. Subject matter shall include terminology, drug standards,
applicable laws and legal aspects, identification of drugs by name and
classification, and the principles of pharmacodynamics of medications used
in the treatment and testing of cardiopulmonary impairment.

b. Techniques of drug administration. Subject matter shall include
principles of asepsis, safety and accuracy in drug administration,
applicable anatomy and physiology, and techniques of administration and any
route of administration for cardiopulmonary medications that fall within
the legal scope of practice of a respiratory care practitioner.

c. Dosage calculations. Subject matter shall include a review of arithmetic
and methods of calculation required in the administration of drug dosages.

d. Clinical experience. Subject matter shall include clinical experience in
administration of the cardiopulmonary medication(s), planned under the
direction of a qualified respiratory care practitioner or other qualified
health care provider responsible for teaching cardiopulmonary medication
administration.

e. Role of the respiratory care practitioner in administration of
cardio-pulmonary medications. Subject matter shall include constraints of
medication administration under the legal scope of practice for respiratory
care practitioners, the rationale for specific respiratory care in relation
to drug administration; observations and actions associated with desired
drug effects, side effects and toxic effects; communication between
respiratory care practitioners and other health care teams; respiratory
care practitioner - client interactions; and the documentation of
cardiopulmonary medication administration.

5.4 Each respiratory care practitioner shall maintain a record that
documents training and proficiency and medications that each practitioner
is authorized to
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administer. At the request of the Council such records may be audited,
reviewed, or copied.

5.5 Documentation of medication administration by the respiratory care
practitioner shall include at a minimum:

a. Patient identification

b. Date of the order

c. Time of the order

d. Name of medication

e. Dosage

f. Frequency of administration

g. Route of administration

h. Method of administration

i. Respiratory care practitioner's name

j. Date and time of administration

k. Documentation of effectiveness

l. Documentation of adverse reactions and notifications if any

SECTION 6: DISCIPLINARY PROCEEDINGS

6.1:a. The license or permit of a respiratory care practitioner or student
found to have committed unprofessional conduct may be subject to
revocation, suspension, or non-renewal. The practitioner or student may be
placed on probation subject to reasonable terms and conditions, or
reprimanded.

6.1:b. Any licensed respiratory care practitioner found, after notice and
hearing, to have engaged in behavior in his or her professional activity
which is likely to endanger the public health, safety or welfare or who is
unable to render respiratory care services with reasonable skill or safety
to patients because of mental illness or mental incompetence, physical
illness or excessive use of drugs including alcohol may have his or her
license revoked, suspended, not renewed or may be placed on probation.

6.2 Unprofessional Conduct

Unprofessional conduct includes any act of fraud, deceit, incompetence,
negligence, or dishonesty and shall include, without limitation, the
following:

a. Performing acts beyond the scope of authorized practice by a respiratory
care practitioner to include violations of Title 24, Delaware Code, § 1770B
or of these regulations.

b. Assuming duties and responsibilities within the practice of respiratory
care without adequate preparation or supervision or when competency has not
been maintained.

c. Performing new respiratory care techniques and/or procedures without
adequate education and practice or without proper supervision.

d. Failing to take appropriate action or follow
policies and procedures in to practice situation designed to safeguard the
patient from incompetent, unethical or illegal health care practices.

e. Inaccurately recording on, falsifying or altering a patient or agency
record.

f. Committing verbal, physical or sexual abuse or harassment of patients or
co- employees.

g. Assigning unqualified persons to perform the practice of licensed
respiratory care practitioners.

h. Delegating respiratory care responsibilities to unqualified persons.

i. Failing to supervise persons to whom respiratory care responsibilities
have been properly delegated.

j. Leaving a patient assignment in circumstances which endangers the
patient except in documented emergency situations.

k. Failing to safeguard a patient's dignity and right to privacy in
providing respiratory care services which shall be provided without regard
to race, color, creed or status.

l. Violating the confidentiality of information concerning a patient except
where disclosure is required by law.

m. Practicing respiratory care when unfit to perform procedures and make
decisions when physically, psychologically, or mentally impaired.

n. Diverting drugs, supplies, or property of a patient or agency or
attempting to do so.

o. Diverting, possessing, obtaining, supplying or administering
prescription drugs to any person, including self, except as directed by a
person authorized by law to prescribe drugs or attempting to do so.

p. Providing respiratory care in this state without a currently valid
license or permit and without other lawful authority to do so.

q. Allowing another person to use his/her license or temporary permit to
provide respiratory care for any purpose.

r. Aiding, abetting and/or assisting an individual to violate or circumvent
any law or duly promulgated rule or regulation intended to guide the
conduct of a respiratory care practitioner or other health care provider.

s. Resorting to, or aiding in any fraud, misrepresentation or deceit
directly or indirectly in connection with acquiring or maintaining a
license to practice respiratory care.

t. Failing to report unprofessional conduct by another respiratory care
practitioner licensee or permit holder or as specified in 4.1:h.

u. Failing to provide respiratory care to a patient in accordance with the
orders of the responsible physician without just cause.

6.3 Disciplinary Investigations And Hearings
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6.3:a. Upon receipt of a written complaint against a respiratory care
practitioner or upon its own motion, the Council may request the Division
of Professional Regulation to investigate the complaint or a charge against
a respiratory care practitioner and the process established by Title 29,
Delaware Code, § 8807 shall be followed with respect to any such matter.

6.3:b. Where feasible, within sixty (60) days of receiving a complaint from
the Attorney General's Office after an investigation pursuant to Title 29,
Delaware Code. § 8807(h), the Council shall conduct an evidentiary hearing
upon notice to the licensee. Written findings of fact and conclusions of
law shall be sent to the Board of Medical Practice along with any
recommendation to revoke, to suspend, to refuse to renew a license, to
place a licensee on probation, or to otherwise reprimand a licensee found
guilty of unprofessional conduct in the licensee's professional activity
which is likely to endanger the public health, safety or welfare, or the
inability to render respiratory care services with reasonable skill or
safety to patients because of mental illness or mental incompetence,
physical illness or excessive use of drugs including alcohol.

SECTION 7: WORKING STUDENT RESPIRATORY CARE PRACTITIONER

7.1 A working student respiratory care practitioner may only practice under
the direct supervision of a licensed respiratory care practitioner. The
scope of practice is limited to those activities for which there is
documented evidence of competency.

7.2 Direct supervision means that a licensed respiratory care practitioner
will be personally present and immediately available within the treatment
area to provide aid, direction, and instruction when procedures are
performed. All evaluations, progress notes, and/or chart entries must be
co-signed by a licensed respiratory care practitioner.

7.3 A student may apply for a student temporary permit. If approved by the
Board, such permit may be issued by the Division of Professional Regulation
and may not be renewed. An application will be considered by the Council
provided that the applicant meets the following criteria:

a. Applicant is matriculated in an approved Respiratory Care Program.

b. Application is submitted no more than 20 weeks prior to the program's
announced graduation date.

c. Applicant shall submit to the Council a certified list of respiratory
care services

which have been successfully completed as a part of the respiratory care
curriculum.

7.4 A student temporary permit shall automatically cease upon graduation or
on the date that the holder is no longer matriculated in and not a graduate
of a Respiratory Care Program. Any holder of a temporary student permit
which ceases for any of the reasons stated above shall within five (5)
working days surrender the permit to the Division of Professional
Regulation.

7.5 Subject to Rule 7.4, a student temporary permit shall be valid for 16
weeks.

7.6 Respiratory care services which may be performed by the holder of a
student temporary permit are limited to only those services which have been
successfully completed by the student as part of a respiratory care
program. Successful completion of these services must be certified by the
program director on the Verification of Respiratory Care Education Form and
submitted to the Council along with an attached competency check list. The
holder of the student temporary permit must also meet the employer's
standards for those procedures in specified patient care situations.

SECTION 8: CONTINUING EDUCATION

8.1 Contact Hours Required for Renewal

8.1:a. The respiratory care practitioner shall be required to complete (20)
twenty contact hours biennially and to retain all certificates and other
documented evidence of participation in an approved/accredited continuing
education program for a period of at least (3) three years. Upon request,
such documentation shall be made available to the Council for random audit
and verification purposes. All contact hours must be completed at least
sixty (60) days prior to the end of the renewal year.

8.1:b. Contact hours shall be prorated for new licensees in accordance with
the following schedule:

Two years remaining in the licensing

cycle requires - 20 hours

One year remaining in the licensing

cycle requires - 10 hours

Less than one year remaining in the

licensing cycle - exempt

8.2 Exemptions

8.2:a. A licensee who because of a physical or mental illness during the
license period could not complete the
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continuing education requirement may apply through the Council to the Board
of Medical Practice for a waiver. A waiver would provide for an extension
of time or exemption from some or all of the continuing education
requirements for one (1) renewal period. Should the illness extend beyond
one (1) renewal period, a new request must be submitted.

8.2:b. A request for a waiver must be submitted sixty (60) days prior to
the license renewal date.

8.3 Criteria for Qualification of Continuing Education Program Offerings

The following criteria are given to guide respiratory care practitioners in
selecting an appropriate activity/program and to guide the provider in
planning and implementing continuing education activities/programs. The
overriding consideration in determining whether a specific activity/program
qualifies as acceptable continuing education shall be that it is a planned
program of learning which contributes directly to the professional
competence of the respiratory care practitioner.

8.3.1 Definition of Contact Hours

8.3.1:a. Fifty consecutive minutes of academic course work, correspondence
course, or seminar/workshop shall be equivalent to one (1) contact hour. A
fraction of a contact hour may be computed by dividing the minutes of an
activity by 50 and expressed as a decimal.

8.3.1:b. Recredentialing examination for certified espiratory therapy
technician, (CRTT), and registered respiratory therapist, (RRT), shall be
equivalent to five (5) contact hours.

8.3.1:c. Successful completion of advanced specialty exams administered by
the

National Board for Respiratory Care, (NBRC), shall be equal to five (5)
contact hours for each exam.

8.3.1:d. One (1) semester hour shall be equal to fifteen (15) contact
hours.

8.3.1:e. One (1) quarter hour shall be equal to ten (10) contact hours.

8.3.1:f. Two (2) hours (120 minutes) of clinical educational experience
shall be

equal to one (1) contact hour.

8.3.1:g. Fifty (50) consecutive minutes of presentation of lectures,
seminars or

workshops in respiratory care or health care subjects shall be equivalent
to one (1) contact hour.

8.3.1:h. Preparing original lectures, seminars, or workshops in respiratory
care or health care subjects shall be granted no more than two (2) contact
hours for each contact hour of presentation.

8.3.1:i. Performing clinical or laboratory research in health care shall be
reviewed

and may be granted an appropriate number of contact hour(s) at the
Council's discretion.

8.3.2 Learner Objectives

8.3.2:a. Objectives shall be written and be the basis for determining

content, learning experience, teaching methodologies, and evaluation.

8.3.2:b. Objectives shall be specific, attainable, measurable, and describe
expected outcomes for the learner.

8.3.3 Subject Matter

Appropriate subject matter for continuing education shall include the
following:

8.3.3:a. Respiratory care science and practice and other scientific topics

related thereto

8.3.3:b. Respiratory care education

8.3.3:c. Research in respiratory care and health care

8.3.3:d. Management, administration and supervision in health care delivery

8.3.3:e. Social, economic, political, legal aspects of health care

8.3.3:f. Teaching health care and consumer health education

8.3.3:g. Professional requirements for a formal respiratory care program or
a related field beyond those that were completed for the issuance of the
original license

8.3.4 Description

Subject matter shall be described in outline form and shall include learner
objectives, content, time allotment, teaching methods, faculty, and
evaluation format.

8.3.5 Types of Activities/Programs

8.3.5:a. An academic course shall be an activity that is approved and
presented by an accredited post-secondary educational institution which
carries academic credit. The course may be within the framework of a
curriculum that leads to an academic degree in respiratory care beyond that
required for the original license, or relevant to respiratory care, or any
course that shall be necessary to a respiratory care practitioner's
professional growth and development.

8.3.5:b. A correspondence course contains the following elements:

1. developed by a professional group, such s an education corporation or
professional association.

2. follows a logical sequence.

3. involves the learner by requiring active response to module materials
and provides feedback.

4. contains a test to indicate progress and to verify completion of module.

5. supplies a bibliography for continued study.

8.3.5:c. A workshop contains the following elements:

1. developed by a knowledgeable individual or
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group in the subject matter.

2. follows a logical sequence.

3. involves the learner by requiring active response, demonstration and
feedback.

4. requires hands-on experience.

5. supplies a bibliography for continued study.

8.3.5:d. Advanced and specialty examinations offered by the NBRC or other
examinations as approved by the Council including:

1. Recredential exam.

2. Pediatric/perinatal specialty exam.

3. Pulmonary function credentialing exams

4. Advanced practitioner exam

8.3.5:e. Course preparation

8.3.5:f. Clinical education experience must be:

1. Planned and supervised.

2. Extended beyond the basic level of preparation of the individual who is
licensed.

3. Based on a planned program of study.

4. Instructed and supervised by individual(s) who possess the appropriate
credentials related to the discipline being taught.

5. Conducted in a clinical setting.

8.4 Educational Providers

8.4:a. Continuing education contact hours awarded for activities/programs
approved by the following are appropriate for fulfilling the continuing
education requirements pursuant to these regulations:

1. American Association for Respiratory Care.

2. American Medical Association under Physician Category I.

3. American Thoracic Society

4. American Association of Cardiovascular and Pulmonary Rehabilitation

5. American Heart Association

6. American Nurses Association

7. American College of Chest Physicians 8. American Society of
Anesthesiologists 9. American Sleep Disorders Association

10. Other professional or educational organizations as approved
periodically by the Council.

8.5 Accumulation of Continuing Education

8.5:a. When a licensee applies for license renewal, a minimum of twenty
(20) contact hours in activities that update skills and knowledge levels in
respiratory care theory, practice and science is required. The total of
twenty (20) contact hours biennially shall include the following
categories:

8.5:a.1. A minimum of 12 contact hours of required continuing education
contact hours required for renewal must be acquired in a field related to
the science and practice of respiratory care as set forth in Subsection
8.3.3, Subject Matter, a, b, or c.

8.5:a.2. The remaining 8 contact hours of the required
continuing education contact hours required for renewal may be selected
from Subsection 8.3.3, Subject Matter.

8.5:b. Contact hours, accumulated through preparation for, presentation of,
or participation in activities/programs as defined are limited to
application in meeting the required number of contact hours a year as
follows:

1. Presentation of respiratory care education programs, including
preparation time, to a maximum of four contact hours.

2. Presentation of a new respiratory care curriculum, including
preparation, to a respiratory care education program, to a maximum of four
contact hours.

3. Preparation and publication of respiratory care theory, practice or
science, to a maximum of four contact hours.

4. Research projects in health care, respiratory care theory, practice or
science, to a maximum of four contact hours.

5. Infection control programs from facility or agency to a maximum of one

contact hour.

6. Correspondence courses that are not within the curriculum that leads to
an academic degree beyond that required for the original license to a
maximum of four contact hours.

7. Presentation or participation in review or recertification in American
Heart Association or Red Cross provider or instructor programs, such as
Advanced Cardiac Life Support, Basic Life Support, Pediatric Advanced Life
Support, or CPR, to a maximum of two contact hours per program.

8. Academic course work, related to health care or health care
administration, to a maximum of four contact hours.

8.6 Review/Approval of Continuing Education Contact Hours

8.6:a. The Council may review the documentation of any respiratory care
practitioner's continuing education.

8.6:b. The Council may determine whether the activity/program documentation
submitted meets all criteria for continuing education as specified in these
regulations.

8.6:c. Any continuing education not meeting all provisions of these rules
shall be rejected in part or in whole by the Council.

8.6:d. Any incomplete or inaccurate documentation of continuing education
may be rejected in part or in whole by the Council.

8.6:e. Any continuing education that is rejected must be replaced by
acceptable continuing education within a reasonable period of time
established by the Council. This continuing education will not be counted
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towards the next renewal period.

8.6:f. Each license not renewed in accordance with this section shall
expire, but may within a period of three years thereafter be reinstated
upon payment of all fees as set by the Division of Professional Regulation
of the State of Delaware.

8.6:g. An applicant wishing to reinstate an expired license shall provide
documentation establishing completion of the required 20 hours of
continuing education during the two-year period preceding the application
for renewal.

SECTION 9. RENEWAL OF LICENSE

9.1:a To renew a license to practice respiratory care, a licensee must
complete a renewal form provided by the Division of Professional Regulation
certifying completion of continuing education.

9.2:b Renewal notices will be mailed by the Division of Professional
Regulation sixty (60) days prior to the expiration of the license.

SECTION 10. APPLICATION FOR A LICENSE

10.1 Application

10.1:a An application for a license to practice respiratory care must be
completed on a form provided by the Board of Medical Practice and returned
to the Board Office with the required, non-refundable fee.

10.2 Completed Application

10.2:a An application for a license to practice respiratory care shall be
considered completed when the Board has received the following
documentation:

a. Non-refundable application fee

b. Completed application for licensure

c. Verification of education form

d. Verification of national examination score

e. Letter(s) of good standing from other states where the applicant may
hold a license, if applicable.

f. Any other information requested in the application.

10.3 Appeals Process

10.3:a When the Council determines that an applicant does not meet the
qualifications for licensure as prescribed under Title 24, Delaware Code, §
1770B and the Rules and Regulations governing the practice of respiratory
care, the Council shall make such recommendation to the Board proposing to
deny the application. The Council shall notify the applicant of its
intended action and reasons thereof. The Council shall inform the applicant
of an appeals process prescribed under Title 29, Delaware Code, § 10131.

Department of Education

Statutory Authority: 14 Delaware Code,

Section 122(d) (14 Del.C. §122(d))

EDUCATIONAL IMPACT ANALYSIS PURSUANT

TO 14 DEL. C., SECTION 122(d)

SMOKING REGULATIONS

A. TYPE OF REGULATORY ACTION REQUESTED

Reauthorization of Existing Regulation

B. SYNOPSIS OF SUBJECT MATTER OF REGULATION

The Smoking Regulation found in the Handbook for K-12 Education section
I.M.11., page A-53 was made a regulation in 1987. It forbids the use,
dispensing and sale of tobacco products by students K-12 during school
hours in school buildings, on school grounds or on school buses. This
regulation did away with "smoking courts" in high schools and generally put
students on notice that smoking in or around schools was totally forbidden.
Since this state regulation was passed a federal law entitled the
Pro-Children Act of 1994, has also been enacted which says "no person shall
permit smoking within any indoor facility owned or leased or contracted for
and utilized by such person for provision of routine or regular
kindergarten, elementary or secondary education or library services to
children." Children are defined as "individuals who have not attained the
age of 18." This law applies to agencies and organizations that receive
federal funds and it covers public schools and numerous other agencies
serving children. This federal law effects adult behavior concerning
smoking which the state regulation did not address. The federal law does
not mention tobacco products such as snuff and chewing tobacco and does not
cover the school grounds and the school buses which are both part of the
Department of Education regulation. The regulation is recommended for
readoption because in concert with the federal statute, most aspects of the
problem are covered and the important emphasis on student behavior is
sustained.

C. IMPACT CRITERIA

1. Will the regulation help improve student achievement as measured against
state achievement standards?

This regulation addresses health and safety, not curriculum issues.

2. Will the regulation help ensure that all students
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receive an equitable education?

This regulation addresses health and safety issues, not equity.

3. Will the regulation help to ensure that all students' health and safety
are adequately protected?

This regulation will at least protect students from tobacco and its ill
effects while they are in school or on school grounds.

4. Will the regulation help to ensure that all students' legal rights are
respected?

This regulation does have the aspect of protecting non smoking students
from the ill effects of smoking by fellow students.

5. Will the regulation preserve the necessary authority and flexibility of
decision makers at the local board and school level?

Readopting this regulation will not change the necessary authority and
flexibility of decision makers at the local board and school level.

6. Will the regulation place unnecessary reporting or administrative
requirements or mandates upon decision makers at the local board and school
levels?

This regulation does not add any unnecessary reporting or administrative
requirements for decision makers at the local board and school level.

7. Will decision making authority and accountability for addressing the
subject to be regulated be placed in the same entity?

The readopted regulation still gives local decision making authority
through the development of a local policy.

8. Will the regulation be consistent with and not an impediment to the
implementation of other state educational policies, in particular to state
educational policies addressing achievement in the core academic subjects
of mathematics, science, language arts and social studies?

This regulation addresses health and safety issues and will not be an
impediment to any policies in the curriculum area.

9. Is there a less burdensome method for addressing the purpose of the
regulation?

The regulation has been in place and readoption of the regulation is the
most effective way to continue to address this concern.

10. What is the cost to the state and local school
boards of compliance with the regulation?

The regulation had been in place for ten years and readoption will not
generate any new costs to the school districts.

I.M.11. SMOKING REGULATIONS

Each school district in Delaware is required to have a policy which, at a
minimum, prohibits smoking and the use, dispensing or selling of tobacco
products such as snuff and chewing tobacco by students in kindergarten
through grade 12 during school hours in school buildings, on school
grounds, or on school buses.

The above regulatory change will be presented to the State Board of
Education at its meeting on February 19, 1998

Department of Education

Statutory Authority: 14 Delaware Code,

Section 122(d) (14 Del.C. §122(d))

The following three (3) regulations are proposed to be repealed by the
Department of Education.

The Handbook for K-12 Education contains a section entitled Fire and
Emergency Preparedness, I.M.12, page A-54. This regulation should be
repealed because the first part of the regulation beginning with the word
"All", through the word "session", is from Del. C., Section 4104. The
second part beginning with the word "During", and ending with the word
"Year", is from the State Fire Prevention Regulations, Part V, Section 1-3,
Fire Drills in Educational and Institutional Occupancies. Since this
section is simply a restating of the Delaware Code and from another
regulation, this does not need to be regulated again by the Department, and
thus should be repealed as a regulation of the Department of Education.

I.M.12. FIRE AND EMERGENCY PREPAREDNESS

a. All Delaware schools are subject to Delaware Code and to State Fire
Prevention Regulations which require that every school be equipped with an
adequate number of fire extinguishers and shall hold a fire drill at least
once every month while the school is in session. (14 Del. C. ¤4109) Fire
drills shall include complete
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evacuation of all persons from the building. During severe weather, fire
drills may be postponed. A record of all fire drills shall be kept and
persons in charge of each school shall maintain a written record on site of
all such fire drills held, giving the time and date of each drill held.
This record of fire drills shall be made available to a representative of
the State Fire Marshal, upon request. The record shall be maintained for a
period of three years, not including the current year. (State Board
Approved December 1993)

The Handbook for K-12 Education contains a section entitled Title I
Complaint Process, Section I.F.2., pages A-15 and A-16. This regulation
needs to be repealed as a Department of Education regulation because the
requirement for the process and the procedures for filing the complaint are
all part of existing federal regulations.

I.F.2. TITLE I COMPLAINT PROCEDURES

a. An organization or an individual may file a written, signed complaint
with the Title I Office of the Delaware Department of Public Instruction
(Title I Office) concerning an alleged violation by a Local Education
Agency (LEA) or the State Education Agency (SEA) of a Federal statute or
regulations that apply to the Title I LEA Program, in accordance with
200.73-75 of the Title I regulations and the following procedures:

(1) The complaint must include (a) a statement that the SEA or an LEA has
violated a requirement of a Federal statute or regulations that apply to
the Title I LEA Program; and (b) the facts on which the statement is based.

(2) The Title I Office shall resolve the complaint and issue a written
report including findings of fact and a decision to the parties included in
the complaint within sixty calendar days of the receipt of the complaint.
An extension of the time limit may be made by the Title I Office only if
exceptional circumstances exist with respect to a particular complaint.

(3) The Title I Office may conduct an independent on-site investigation of
a complaint, if it determines that an on-site investigation is necessary.

b. An organization or an individual may file a written, signed complaint
with the LEA, in lieu of the Title I Office, concerning an alleged
violation by the LEA of a Federal statute or regulations that apply to the
Title I LEA Program.

(1) The complaint must include (a) a statement that the LEA has violated a
requirement of a Federal statute or regulations that apply to the Title I
LEA
Program and (b) the facts on which the statement is based.

(2) The superintendent or the agency head of the LEA shall resolve the
complaint and issue a written report including findings of fact and a
decision to the parties involved in the complaint within thirty calendar
days of the receipt of the complaint.

(3) An appeal of the LEA decision may be made by the complainant to the
Title I Office of the Department of Public Instruction. The appeal shall be
in writing and signed by the individual making the appeal. The Title I
Office shall resolve the appeal in the same manner as a complaint, as
indicated in A.1. through 3.

c. Any party to the complaint has the right to request the Secretary, U. S.
Department of Education, to review the final decision of the Title I
Office. The request for an appeal of the decision to the Secretary shall be
made in writing to the Title I Office within sixty days of the receipt of
the decision.

d. Complaints and appeals to the Title I Office shall be mailed to the
following address:

Title I Office

Department of Public Instruction

P. O. Box 1402

Dover, Delaware 19903

(State Board Approved February 1990)

The Handbook for K-12 Education contains a section entitled Title IX of the
Educational Amendments of 1972 Concerning Physical Education, I.C.2., pages
A-3 and A-4. This regulation needs to be repealed because it simply
presents information for technical assistance purposes from the federal
regulations for Title IX and is not a Department of Education regulation.

I.C.2. TITLE IX OF EDUCATIONAL AMENDMENTS OF 1972 CONCERNING PHYSICAL
EDUCATION

In 1976 and 1978 "girls physical education" and "boys physical education"
became "student physical education" under Title IX of the Educational
Amendments of 1972.

a. Section 86.34 of Title IX states that

(1) Physical education units of instruction required for one sex must be
required for everyone.

(2) Elective units must be scheduled on an open enrollment basis.

(3) Grouping by ability is permitted as long as objective standards of
individual performance related to the unit studies are applied without
regard to
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sex.

b. Section 86.33 of Title IX states that

(1) Students may be separated by sex for participation in contact sports.

(2) Evaluation outcomes may not adversely affect members of one sex.

(3) Students may be separated for instruction which deals exclusively with
human sexuality.

competence, honesty, and integrity of the applicant or registrant as
required by title 29 of the Delaware Code;

(12) A list of any known litigation involving the emploee organization
within the last five years.

2. Regulations 4.2(10)(ii), (13), (15), (17)

4.2 The key employee shall register with the Agency on registration forms
supplied by the Agency. Registration forms shall require the key employee
to provide the following without limitation:

(10)(ii) Excluding minor traffic offenses, a detailed description of the
following areas of criminal conduct, if any, including whether the crime
involved is denominated a felony or misdemeanor;

(ii) Any criminal offenses, that occurred within ten years of the
application or registration, for which the applicant or registrant was
arrested, charged, indicted or summoned to answer, which are pending ir for
which he was not convicted;

(13) Whether he has ever been subpoenaed as a witness before any grand
jury, legislative body, administrative body, or crime commission on matters
pertaining to the operation or performance in any labor organizaion, which
shall include all details relating thereto.

(15) Any other information the Director determines is needed to determine
the competence, honesty, and integrity of the applicant or registrant as
required by title 29 od the Delaware Code.

(17) A Release Authorization directing all courts, probation departments,
employers, educational institutions, financial and other institutions and
all governmental agencies to release any and all information pertaining to
the applicant or registrant as requested by the Agency or the Delaware
State Police that bears on and is necessay and reasonably related to the
statutory standards of competence, honesty, or integrity as specified by 29
Del.C. section 4805(a)(24)(c)(ii).

3. Regulation 6.1

6.2 The Director shall conduct employment investigations for any person
seeking employment with the Agency for compensation for a position which
has direct access to lottery ticket saales agents, video lottery agents, or
vendors. Those new employee applicants who do not meet the requirements of
these Regulations and 29 Del.C. chapter 48 may not be permitted to be
employed by the Lottery.
The above regulatory changes will be presented to the State Board of
Education at its meeting on February 19, 1998
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Department of Finance

Division of Revenue

Office of the State Lottery

Statutory Authority: 29 Delaware Code,

Section 4805(a), (a)(24)(f), (25) (29 Del.C. §§ 4805(a), (a)(24)(f), (25)

The Lottery proposes these rules pursuant to 29 Del.C. §§ 4805(a),
4805(a)(24)(f), 4805(25) and 29 Del.C. § 10115. Proposed rules 3.2(4),
3.2(9), 3.2(12), 4.2(10)(ii, 4.2(13), 4.2(15), and 4.2(17) would clarify
the background investigation requirements for employee organizations and
key employees. Proposed rule 6.1 would clarify the background investigation
requirements for Lottery employees. Copies of the proposed rules may be
obtained from the Lottery Office. Comments may be submitted in writing to
Donald Johnson, at the Lottery Office on or before 4:00 p.m. on March 3,
1998. The Lottery Office is located at 1575 KcKee roa, Suite 102, Dover, DE
19901 and the phone number is (302) 739-5291.

PROPOSED REGULATIONS

1. Regulations 3.2(4), (9), (12)

3.2 The employee organization shall register with the Agency on
registration forms supplied by the Agency. Registration forms shall require
the employee organization to provide the followin, without limitation:

(4) The name and address of all afiliates which are either a parent body or
any superior organization with any right or ability to control, supervise,
discipline or set policy for this organization.

(9) Any other information the Director determines is needed, necessary, and
reasonably related to the
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Department of Finance

Division of Revenue

Statutory Authority: 30 Delaware Code, Section 563 (30 Del.C. § 563)

PROPOSED TECHNICAL INFORMATION MEMORANDUM 98-1

SUBJECT: "CHECK THE BOX" REGULATIONS

Public Comment shall run from February 1, 1998 through March 3, 1998 and
comments must be received by March 3, 1998. Comments shall be made in
writing to John Maciejeski, whose address appears at the conclusion of this
Memorandum.

Purpose of Regulation -- The purpose of this regulation is to explain the
relationship between the classification of organizations for federal and
state tax purposes and the procedures for electing entity classification.

Authority to make regulations; general information --

(i) The Director of Revenue is charged with the administration and
enforcement of all state tax laws unless such duties are expressly
conferred upon another agency. Title 30 Delaware Code §563

(ii) Published regulations are made and promulgated pursuant to authority
vested in the Director. 30 Del. C. §563

(iii) As used in published regulations, references to a section (§) number
refer to a section of the Delaware Code. References to a section (§) number
preceded by a "1", as in §1.1900-1, refer to sections of regulations
published by the Division of Revenue of this State.

REGULATION:

§1.1900-1 In general; Classification of organizations for federal and state
tax purposes; election of entity classification.

(a) Meaning of terms -- Any term used in these regulations shall have the
same meaning as when used in a comparable context in the laws and income
tax regulations of the United States referring to federal income taxes,
unless a different meaning is clearly required. Any reference to the laws
of the United States or to the Internal Revenue Code shall mean the
Internal Revenue Code of 1986 [26 U.S.C. § 1 et seq.] as amended
and regulations and amendments thereto and other laws of the United States
relating to federal income taxes, as the same may be or become effective,
for the taxable year.

(b) Classification of entities -- The classification of entities for
Delaware tax purposes shall be as prescribed for federal tax purposes.
Unless inconsistent with Delaware law, the provisions of Sections
301.7701-1; 301.7701-2; and 301.7701-3 of the Regulations to the Internal
Revenue Code of 1986 are hereby adopted for Delaware purposes.

(c) Election of corporation classification by certain business entities --
A business entity that is not classified as a corporation for federal tax
purposes but which elects to be classified as a corporation pursuant to
§301.7701-3 of the Regulations to the Internal Revenue Code of 1986 shall
be classified as a corporation for Delaware tax purposes.

(d) Notice of election to be classified as a corporation -- Business
entities electing to be classified as a corporation for federal tax
purposes shall attach a copy of Internal Revenue Service Form 8832, "Entity
Classification Election" to their Delaware Corporate Income Tax Return,
Form 1100.

(e) Tax return requirements --

(1) In general -- Members or partners of a business entity which has not
elected to be classified as a corporation and which does business in this
State shall file income tax returns for all such tax years.

(2) Special rules for non-electing, single member limited liability
companies doing business in Delaware and their corporate members --
Notwithstanding other provisions of these regulations or regulations of the
Internal Revenue Code to the contrary,

(A) a limited liability company (LLC) that has only a single, individual
member and (i) does not elect to be classified as a corporation pursuant to
these rules, and (ii) derives any income from sources in this State
(determined in accordance with Title 30 Delaware Code §1124 as in the case
of a nonresident individual), or (iii) has a member residing in this State,
shall file partnership income tax information and business license and
gross receipts tax returns for all such tax years.

(B) A corporation which is a single member of a non-electing limited
liability company (LLC) and which is not exempt under Title 30 Delaware
Code §1902(b), shall file corporation income tax and business license and
gross receipts tax returns for all such tax years.

(3) The attached flow charts illustrate these principles.
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(f) Effective date of election -- An election made under this regulation
shall be effective on the effective date determined under
§301.7701-3(c)(1)(iii) of the Regulations to the Internal Revenue Code of
1986.

(g) Effective date of this regulation -- This regulation is effective as of
January 1, 1997.

(h) Contact Person -- For more information about these regulations or the
classification of entities, contact John J. Maciejeski, Jr., Assistant
Director, Office of Business Taxes, State of Delaware Division of Revenue,
820 N. French Street, Wilmington, Delaware 19801 or phone (302) 577-8450.

SYNOPSIS

Under Internal Revenue Service regulations, a per se corporation is
required to be classified and taxable as a corporation.

Any organization that is not a corporation is taxable as a partnership if
it has at least two members or a sole proprietorship if it has a single
owner. Both partnerships and sole proprietorships are "eligible entities".

Existing entities are classified as they were prior to the effective date
of the regulations. Newly organized eligible entities are, by default,
partnerships if they have at least two members or sole proprietorships if
they have a single owner. A single owner entity may not be a partnership or
pass-through entity.

Under the federal "check the box" regulations, eligible entities may elect
to be classified as associations taxable as a corporations. Corporations
and certain foreign, insurance, banking and other listed associations may
only be taxable as corporations.

Limited Liability Companies, except single owner LLC's, are by default
taxable as partnerships. An LLC is an eligible entity which may make the
election to be taxable as a corporation.

SPECIAL NOTE: The 1997 Delaware Corporate Income Tax Returns and
instructions were prepared and mailed erroneously identifying the "Check
the Box" regulations as Technical Information Memorandum 97-9. The correct
number is Technical Information Memorandum 98-1.

William M. Remington

Director of Revenue

"Check the Box" Diagram

Non-Electing

Single Member LLC

Non-Electing LLC conducts

LLC an active trade/

business in

Delaware

Corporate Single Member Individual Single Member

Entity Entity

Disregarded Disregrded

LLC is considered LLC is considered

a Division of Corporation. a Sole Proprietor

Nexus created for the - Schedule C

corporate single

"Check the Box" Diagram

Non-Electing

Multiple Member LLC

Non-Electing

LLC

Taxed as a

Partnership

Partnership attributes flow

through to Corporate and

Individual partners

Nexus created for Corporate

and Individual Partners

"Check the Box" Diagram

Electing Single/Multiple

Member LLC

LLC

Entity Elects

Taxed as a Taxed as a

Corporation Partnership

Corporate attributes Partnership attributes

do not flow through flow through to

Corporate and Individual

Nexus not created Nexus created for

for member Corporate and

Individual Partners
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LLC conducts an active trade/business in Delaware
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Department of Health &

Social Services

Division of Social Services

Statutory Authority:

PUBLIC NOTICE

Medicaid / Medical Assistance Program

In compliance with the State's Administrative Procedures Act (APA - Title
29, Chapter 101 of the Delaware Code) and with 42CFR §447.205, the Delaware
Department of Health and Social Services (DHSS) Division of Social
Services/Medical Assistance Program (DMAP) hereby publishes notice of
proposed policy amendments several Medicaid provider manuals including the
General Policy Manual, the Long-Term Care Provider Manual, the
Non-Emergency Transportation Provide Manual, the Home and Community-Based
Services Provider Manual, the Hospice Provider Manual, the Practitioner
Provider Manual, and the Independent Laboratory Provider Manual. The
proposed policy changes are as follows:

GENERAL POLICY

Licensure/Certification

All providers who are enrolled with the DMAP must be professionally and
properly licensed and/or certified in accordance with the federal and state
laws in the state in which they are located. The provider type must match
the State licensing category.

In addition, the following providers must meet the requirements for
participation in Medicare (Title XVIII) as evidenced by certification from
the Division of Public Health Office of Health Facilities Licensure and
Certification: Long Term Care facilities, Inpatient and Outpatient
hospitals, Rehabilitation agencies, Independent laboratories, Hospice
organizations, Home Health agencies, Certified Physical Rehabilitation
units of an Acute Care hospital, Ambulatory Surgical Centers/Free Standing
Surgical Centers, and Renal Care Centers.

With the exception of behavioral health services provided through a Managed
Care Organization (MCO), mental health clinic services shall be rendered
only by providers which have been certified by the Division of Alcoholism,
Drug Abuse and Mental Health (DADAMH) of the Department of Health and
Social Services (DHSS).

Ambulance companies located in Delaware must be certified in accordance
with the State Fire Prevention Commission (Title 16, Del. Code, Chapter
67). Ambulance companies located outside of Delaware must be properly
licensed and certified by the State in which they are located.

Failure to be certified and properly licensed at the time service was
provided may result in penalties and denial of payment by the DMAP.

Family Planning and Related Services

Who is Eligible

Females of childbearing years whose Medicaid (categorically or expanded
population) is terminated for a non-fraudulent reason are eligible for
family planning and related services for 24 months. Family planning
services are defined as those services provided to females of childbearing
age to temporarily or permanently prevent or delay pregnancy.

What Services Are Covered

Effective for dates of service 1/1/96 and after, the Family Planning and
Related Services Benefit Package includes:

· contraceptive management; including non-systemic drugs and devices
(excluding condoms), and oral contraceptives systemic drugs ,and related
surgical procedures (for example, ligation of fallopian tubes).

· diagnosis and treatment of sexually transmitted diseases (STDs) when
provided or prescribed during the family planning visit.

· HIV screening, diagnosis, and counseling ONLY when provided during a
family planning visit.

Effective for dates of service 3/1/96 and after, coverage of
pharmaceuticals prescribed during the family planning visit to eradicate
the causative organism of a covered STD will be added to the Family
Planning and Related Services Benefit Package. Those pharmaceuticals
covered for a diagnosis of STD will be limited to the following four
therapeutic classes: antibiotic, anti viral, anti fungal, anti protozoan.
Pharmaceuticals prescribed to treat an STD outside of a family planning
visit are not covered.

Non-Qualified Non-Citizens (Aliens) Aliens

Illegally Residing, Non-Qualified

Effective for dates of service 7/1/97 and after, illegally residing,
non-qualified Non-Citizens ( aliens are eligible ONLY for coverage of
emergency and labor/delivery services. These services must be rendered in
an acute care hospital emergency room or in an acute care inpatient
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hospital. In addition, emergency services must be rendered for diagnoses
designated by the DMAP as an emergency (see Appendix G for a comprehensive
list of the covered diagnoses).

The DMAP defines an emergency as:

· a sudden serious medical situation that is life threatening; OR

· a severe acute illness or accidental injury that demands immediate
medical attention or surgical attention; AND

· without the treatment a person's life could be threatened or he/she could
suffer serious long lasting disability.

Medically necessary physician (surgeon, pathologist, anesthesiologist,
emergency room physician, internist, etc.) or midwife services rendered
during an emergency service that meets the above criteria are covered.

Ancillary services (lab, x-ray, pharmacy, etc.) rendered during an
emergency service that meets the above criteria are covered.

Emergency ambulance services to transport these individuals to and from the
services defined above are also covered.

Services not covered for illegally residing, non-qualified Non-Citizens
aliens include, but are not limited to:

· ANY service delivered in a setting other than an acute care hospital
emergency room or an acute care inpatient hospital.

· ANY service (pharmacy, transportation, office visit, lab, x-ray, or home
health, etc.) that precedes or is subsequent to a covered emergency service
(except that emergency ambulance transportation directly related to the
emergency service IS covered).

· Organ transplants.

· Long term care or rehabilitation care.

· Routine prenatal care and post partum care.

Legally Residing, Qualified and Non-Qualified

Legally residing, qualified and non-qualified aliens may be found eligible
for full Medicaid benefits.

Medicaid/Medicare Recipients

Medicaid "Buys-in" Part A and/or Part B Medicare for certain eligible
recipients. Some of these recipients are eligible for the whole range of
Medicaid services and some, such as QMBs and SLIMBs, are not. All are
eligible
for the full range of Medicare services.

For these dual eligibles, DMAP will pay an amount equal to, part, or all of
the incurred Part B deductible or coinsurance remaining after Medicare has
paid. Medicare Part A deductible and coinsurance amounts will be paid in
full by DMAP. The specific payment methodology is as follows:

For services that the DMAP normally covers, the amount paid for the Part B
co-insurance and deductible will be limited to either: 1) the maximum
Medicaid rate for the service minus the actual Medicare payment or, 2) the
deductible/coinsurance, whichever is less. Zero payment will be made when
the Medicare payment is equal to or higher than the Medicaid rate.

Effective September 1, 1996, Medicaid will reimburse the full co-insurance
and deductible amounts for QMBs after Medicare payment.

For services that are not normally covered by the DMAP program, the
provider will be reimbursed the full Part B coinsurance and/or deductible
amount identified by Medicare.

If a dual eligible also carries other health insurance coverage in addition
to Medicare and Medicaid, that resource must be billed before Medicaid.

Participating providers agree to accept the final DMAP payment disposition
as payment in full. Therefore, recipients eligible for both Medicaid and
Medicare should not be billed for any non-covered charges or remaining
portions of the Medicare deductible and coinsurance. Exceptions to the DMAP
policy prohibiting the billing of recipients can be referenced in the
Billing DMAP Recipients section of this General Policy.

LONG-TERM CARE PROVIDER MANUAL

VII. NURSING FACILITY ANCILLARY CHARGES

The DMAP will reimburse private nursing facility providers for some
ancillary charges that are separate from the facility's per diem rates as
follows:

· Physical therapy, by RPT only.

· Occupational therapy.

· Speech therapy.

· Oxygen.

Facilities will be paid at the median cost for each service (cap) or their
actual cost, whichever is lower. Facilities
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must bill for these ancillary services utilizing their Ancillary provider
Identification number ending in the number twenty-six (26) and utilizing a
HCFA 1500 claim form. See APPENDIX C for valid HCPC procedure codes. A
further explanation of covered ancillaries follows:

Oxygen

Oxygen H size Tank. (Maximum fee = $30.50 per tank).

Oxygen must be ordered by a physician. For date of service, use first day
the oxygen tanks were actually used by patient. Claims will pend for review
if more than four (4) tanks per month are billed. Use of more than four (4)
tanks may indicate need for more cost effective system. Supportive
documentation must be attached to the claim justifying need for this method
if patient used more than four (4) tanks in a month.

Oxygen per hour on monthly basis. (Maximum fee = $1.25 per hour).

Oxygen must be ordered by physician. Claim will pend for review if facility
bills for more than two hundred forty-eight (248) hours in a month. If
after first month patient requires more than two hundred forty-eight (248)
hours of oxygen, facility should switch to concentrator system for
patient's future use.

Oxygen concentrator per day per month. (Maximum fee = $8.00 per day).

Oxygen must be physician ordered. Facility must specify which days of the
month the concentrator was used. Facility can only bill for maximum of
thirty-one (31) days. If facility bills for more than thirty-one (31) days
on a claim form, the claim will reject and will be returned for correction.
After facility bills for more than three (3) months worth of oxygen,
supportive documentation must be attached to the claim to justify need for
continuous oxygen.

If more than one type of oxygen is used in a month, provide an explanation.

Physical Therapy

Physical Therapy Evaluation. (Maximum fee = $45.00 evaluation).

The DMAP will reimburse for the initial evaluation performed by Registered
Physical Therapist. The DMAP will pay for one (1) evaluation per treatment
course. Date of service is the actual day evaluation was performed. If
facility bills for more than one (1) evaluation in six (6) months,
supporting documentation must be attached to the claim to justify the need
for the new evaluation and new course of treatment.

Physical Therapy Treatment. (Maximum fee = $31.00 per treatment).

The DMAP will reimburse for one treatment per session provided by
Registered Therapist only. The DMAP will not reimburse for physical therapy
treatment delivered on the same day as a physical therapy evaluation. The
DMAP will reimburse for maintenance as well as restorative therapy if
doctor ordered and if monthly progress notes are completed by the therapist
indicating what treatment was rendered at each session and the progress of
the patient.

The DMAP will reimburse for up to twenty-three (23) sessions in a month. If
more than twenty-three (23) sessions are required in a month, prior
authorization must be requested of the Long-Term Care Coordinator. Payment
will not be made for more than twenty-three (23) sessions if they have not
been prior authorized.

If therapy continues for longer than ninety (90) days, claims must have
supporting documentation attached justifying need for therapy after ninety
(90) days. Supporting documentation would include a copy of the physician's
order for therapy and copies of the therapist's progress notes indicating
that the resident is still making progress.

Speech Therapy

Speech Therapy Evaluation (Maximum fee = $55.00 per evaluation)

The DMAP will reimburse for the initial evaluation for a course of
treatment. The evaluation must be performed by a MSCCCSLP (Master of
Science Certification Clinical Competency Speech Language Pathologist). The
facility should bill for actual date of service. If the facility bills for
more than one (1) evaluation in a year, supporting documentation must be
attached to the claim to justify the need.

Speech Therapy Treatment (Maximum fee = $35.00 per treatment)

The DMAP will reimburse for one (1) treatment per session. Therapy must be
provided by a MSCCCSLP. Monthly progress notes must be written by MSCCCSLP.
Reimbursement will not be made for speech therapy treatment delivered on
the same day as a speech therapy evaluation.

The DMAP will reimburse for a maximum of twenty-three (23) sessions per
month. If more than twenty-three (23) sessions are required in a month,
prior authorization must be requested of the Long-Term Care Coordinator.
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Reimbursement will not be made for more than twenty-three (23) sessions if
they have not been prior authorized.

If therapy continues for more than ninety (90) days, the facility must
attach supporting documentation to the claim to justify continuing need.
Supporting documentation would include copies of the physician order for
therapy and the therapist's progress notes. Notes must indicate what
treatment was rendered in each session and progress or outcome of the
session.

Occupational Therapy

Occupational Therapy Evaluation. (Maximum fee = $60.00 per evaluation.

The DMAP will reimburse for one (1) evaluation per treatment course.
Evaluation must be performed by a Registered Occupational Therapist (ROT).
The facility should bill actual date evaluation was completed. If the
facility bills for more than one (1) occupational therapy evaluation in a
year, supporting documentation must be attached to the claims to justify
the need for a new evaluation and new course of treatment.

Occupational Therapy Treatment. (Maximum fee = $38.00 per treatment).

The DMAP will reimburse for one (1) treatment per session performed by a
Registered Occupational Therapist or by an Certified Occupational Therapy
Aide under the direct supervision of a Registered Occupational Therapist.
The therapy must be ordered by a physician. Monthly progress notes must be
completed by the therapist indicating what treatment was rendered at each
session and progress made by the patient. Reimbursement will not be made
for therapy treatments provided on the same day as an occupation therapy
evaluation.

The DMAP will reimburse for up to twenty-three (23) sessions per month. If
more than twenty-three (23) sessions are required in a month, prior
authorization must be requested of the Long-Term Care Coordinator.
Reimbursement will not be made for more than twenty-three (23) sessions if
they have not been prior authorized.

If therapy continues for longer than ninety (90) days, claims must have
supporting documentation attached justifying need for therapy after ninety
(90) days. Supporting documentation would include copies of the physician's
order for therapy and the therapist's progress notes.

NON-EMERGENCY MEDICAL TRANSPORTATION PROVIDER POLICY

I. GENERAL INFORMATION

In accordance with Federal Regulation 42 CFR 431.53 the Delaware Medical
Assistance Program (DMAP) will assure transportation for eligible Medicaid
recipients who need to secure necessary medical care that is covered by the
DMAP and who have no other means of transportation. The DMAP is designed to
assist eligible Medicaid recipients in obtaining medical care within the
guidelines specified in this policy.

The DMAP defines non-emergency medical transportation services as
transportation to or from medical care for the purpose of receiving
treatment and/or medical evaluation. The DMAP will determine the
transportation provider to be in compliance with this policy as long as the
transport is to or from a medical service.

The DMAP assigns a unique provider number ending with "15" to each
non-emergency transportation provider enrolled with the DMAP.

Scope of Service

Transportation services are available through the DMAP when provided by an
enrolled Medical Transportation provider to an eligible Medicaid recipient
when:

· The recipient is transported to or from a medical provider to receive a
medical service that is covered by the DMAP.

· The transport is the least expensive available means suitable to the
recipient's medical needs.

· The transport used to get a Medicaid recipient to a medical provider of
their choice is generally available and used by other residents of the
community.

The DMAP covers transportation is covered for eligible Medicaid clients
from the point of pickup to the medical provider location or from the
medical provider location to the point of delivery. If an individual only
goes to a medical appointment and does not return to the original pick up
designation, the DMAP will only be charged one way and not a round trip
fare. The service will include all vehicles, drivers, dispatch, vehicle
maintenance, fuel, lubricants, and any and all other components necessary
to provide a transportation service for the needs of the DMAP client.

The DMAP covers transportation for an individual who is responsible for the
care of a Medicaid client. Transportation shall be provided to the
individual to receive medical instructions in the care of the Medicaid
client or to visit the Medicaid client when they are
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hospitalized. The transport will be considered a service to the Medicaid
client and therefore must be billed using the Medicaid ID# of the
hospitalized client. The transportation provider must fully document these
transports. The documentation must include the name(s) of those being
transported and the reason they are being transported. The provider must
bill these transports using the appropriate HCPCS procedure code found in
Appendix A. In cases when there are two persons responsible for the care of
a Medicaid client, and both are transported the provider must use the
appropriate HCPCS procedure code with the modifier Y1.

Transportation services provided to Medicaid recipients are reimbursable by
the DMAP only when the medical service received by the recipient is a
service that is covered by the DMAP at the time the transportation service
is provided or is a service provided by a Managed Care Organization (MCO)
which is not normally covered by the DMAP (except routine eye care for
adults). Transportation services provided to non-Medicaid recipients cannot
be claimed for DMAP reimbursement.

Definitions

Non-emergency medical transportation services are defined as transportation
to or from any DMAP covered medical service for the purpose of receiving
treatment and/or medical evaluation. Whenever possible, medical
transportation funded by the DMAP shall be integrated with transportation
services provided by other departments of Health and Social Services.
Transportation services available without cost to the general public must
also be made available without cost to Medicaid recipients. Volunteer
groups and non-profit agencies should be used to the extent possible,
including, but not limited to, senior citizen organizations, agencies on
aging, etc. If neighbors, friends, relatives or voluntary organizations
have been providing transportation services to a Medicaid recipient, it is
reasonable to expect them to continue.

The following definitions pertain to non-emergency medical transportation
only.

Appropriate Method of Transportation is the least expensive type of
transportation that best meets the physical and medical circumstances of a
recipient requiring transportation to a medical service.

Assistance is when a recipient must be physically helped from within or
into a building and/or from within or into the medical provider's site.
Without such assistance, it would be unsafe or impossible for the recipient
to reach the vehicle or the medical provider's site. The assistance
is included as part of the transportation rate.

Attendant is an employee of a transportation provider, who in addition to
the driver, is required to assist in the transport of the recipient due to
his/her physical, mental or developmental status.

Available Transportation is public transportation, an enrolled Medicaid
provider, organization, or agency who offers appropriate transportation
services to a recipient who requires medical transportation to a medical
service.

Cancel Call is notification to the transportation provider ,prior to the
time the vehicle is enroute to the pickup point, not to provide services to
a recipient.

Escort is an interested individual that must accompany a recipient due to
recipient's physical/mental/developmental capacity. Examples of an escort
include, but are not limited to, a parent, guardian, or an individual who
assumes parental like responsibility, or a child of a geriatric parent. The
escort's presence is required to ensure that the recipient receives proper
medical service/treatment. Refer to Appendix A, modifier Y1 for billing
information.

Loaded Mileage is the distance traveled by a motor vehicle while
transporting a recipient from a pickup point to a drop-off point.

Night Call Charge is an additional fee that may be paid when transportation
service is dispatched between the hours of 6:00 p.m. and 6:00 a.m.
inclusive.

No-Show is when a recipient fails to cancel a scheduled transportation
service.

Prior Authorization is the approval for a service by the DMAP or the DMAP's
agent before the provider actually renders the service. In order to receive
reimbursement from the DMAP, a provider must comply with all prior
authorization requirements. The DMAP in its sole discretion determines what
information is necessary in order to approve a prior authorization request.

Provider Agreement is the signed written contractual agreement between the
DMAP and the provider of services or goods.

Provider Headquarters is the provider's base of operations closest to the
pickup point. A provider may have more than one (1) headquarters.

Recipient/Client is a person eligible for services under the DMAP.
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Shared Ride a shared ride is when more than one recipient occupies a
vehicle during the same trip.

Trip - One Way and Round Trip A one way trip is the dispatching of a
vehicle to the recipient(s)' pickup point and transporting the recipient(s)
to a medical provider, or from a medical provider to the drop-off point. A
round trip is the dispatching of a vehicle to the recipient(s)' pickup
point, transporting the recipient(s) to a medical provider and transporting
the recipient(s) back to the pickup point.

Unloaded Mileage is the distance traveled by the motor vehicle carrying no
passengers, enroute to the point of pickup or enroute from the point of
drop-off.

Waiting Time is the time a vehicle is waiting at a medical provider's
facility, to which the transportation provider transported the recipient,
in order to transport the recipient to another destination, during the same
trip.

Covered Medical Services

The DMAP will reimburse non-emergency transportation providers for
transporting eligible Medicaid recipients to or from one of the following a
medical services covered by the DMAP: Examples of medical services are
found in the General Policy section of the manual.

· Acute care inpatient general hospital services (other than services in
institutions for tuberculosis or mental diseases)

· Outpatient hospital services

· Rural health clinic services and Federally-qualified health center
services

· Laboratory and X-ray services

· Early and periodic screening, diagnosis, treatment (including routine eye
care, dental services, and other medically necessary services that are not
covered for the general population) for individuals under age 21

· Family planning services (including voluntary sterilization)

· Physician services

· Durable medical equipment (see Limitations and Exclusions)

· Nurse-midwife services

· Services furnished by a certified nurse practitioner

· Podiatry services for routine foot care only for recipients who are
diagnosed as having diabetes or circulatory/vascular disorders

· Clinic services, including mental health clinics, ambulatory surgical
centers (ASCs) or free-standing surgical centers (FSSCs)

· Extended/enhanced services for high risk pregnant women (Smart Start
Program)

· Rehabilitative services, including Community Support Services (CSS) and
personal care services for individuals active with the Division of Alcohol,
Drug Abuse and Mental Health determined to need intervention due to
alcoholism, drug abuse or mental illness, & Day Health and Rehabilitation
Services for individuals with mental retardation

· HMO's

· Physical, Occupational, Speech and Hearing Therapies for adults when
provided by an authorized rehabilitative agency, home health agency or
outpatient hospital.

Non-emergency transportation providers who believe that they are furnishing
transportation for a Medicaid recipient on the same day as another
transportation company may wish to submit a paper claim to EDS with
documentation attached that will verify the transport.

Non-Covered Medical Services

Examples of medical services that are not covered by the DMAP include, but
are not limited to, those list below. If any of the medically-related
services listed below are provided to a Medicaid recipient who is enrolled
with an MCO as part of that MCO's benefit package, Medicaid reimbursement
is available.

· Chiropractic Services

· Routine dental, vision, prosthetics, orthotics and psychological services
for adults (age 21 and over)

· Cosmetic surgery

· Psychologist services for adults

· Social Services

· Educational Services

· Reversal of sterilization or fertility related services

· Autopsies

· Inter-Hospital transportation

· Vocational Training

· Day Care

· Supplies in a non-emergency ambulance incident to the patient's
condition, i.e., oxygen, intravenous.

Limitations and Exclusions

Reimbursement for medical transportation will be made subject to the
limitations and exclusions that apply to these services. The limitation and
exclusions are, but not limited to:

Limitations

· The DMAP reserves the right to make the
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determination as to which type of transportation is the most appropriate
for the recipient.

· The DMAP may pay for only the least expensive appropriate method of
transportation, depending on the availability of the service and the
physical and medical circumstances of the patient (recipient).

· The DMAP reserves the right to limit its payment of transportation to the
nearest appropriate provider of medical services when it has made a
determination that traveling further distances provides no medical benefit
to the recipient.

· The DMAP may pay for transportation to procure Durable Medical Equipment
(DME) which requires individualized fittings or measurements when the
service cannot be provided in the home.

Exclusions

· The DMAP will not provide transportation to receive services not covered
by the Program.

· The DMAP will not reimburse for services in which prior approval is
required but was not obtained.

· The DMAP will not be reimburse for services that are not medically
necessary or which are not provided in compliance with the provisions of
the Program.

· The DMAP will not reimburse for any travel when the Medicaid recipient is
not an occupant of the vehicle.

· The DMAP will not transport a recipient to a medical facility for reasons
other than a medical examination and/or treatment.

· The DMAP will not reimburse for transportation provided by relatives or
individuals living in the same household with the recipient.

· The DMAP will not reimburse for transportation provided in the
recipient's vehicle, driven by the recipient or another person.

The DMAP will not provide transportation to a medical facility when the
visit is for the sole purpose of the recipient picking up a prescription or
written prescription order.

· The DMAP will not reimburse for unloaded mileage, waiting time, or
no-shows. The following definitions apply:

* Unloaded mileage is the distance traveled by the vehicle carrying no
passengers, enroute to the point of pick-up or enroute from the point of
drop-off.

* Waiting time is the time a vehicle is waiting at a pick-up point in order
to transport the recipient.

* A no-show is when a recipient fails to cancel a scheduled transportation
service and the transport arrives a the pick-up point.

Services Which Require Prior Approval

As a condition of reimbursement, the DMAP requires that certain services be
approved prior to the time they are rendered. In order to be reimbursed for
prior approved services, the recipient must be Medicaid eligible at the
time the services are rendered.

Prior approval, when required, must be obtained before non-emergency
transportation services are rendered and, if possible, at least forty-eight
(48) hours in advance. When the recipient receives health care services
from more than one provider and requires approved transportation to each, a
separate prior approval must be obtained for transportation to each health
care provider.

A non-emergency transportation provider must obtain prior approval from the
DMAP before providing the following transport services. listed below:

· Any transportation by commercial bus, train, or air service;

· Any transportation involving lodging and/or meals (reimbursement for
meals is limited to the amount authorized for State employees or less);

· All transportation services outside the region (the region is D.C., PA.
NJ and MD).

Requests for approval must be submitted in writing and mailed or faxed to
the Medicaid Out-of-State Coordinator at:

Division of Social Services

Medicaid Unit, Lewis Building

P.O. Box 906

New Castle, DE 19720

FAX #: 302-577-4899

If possible, approval must be obtained at least forty-eight (48) hours
before non-emergency transportation services are rendered. When the
recipient receives health care services from more than one provider and
requires approved transportation to each, a separate prior approval must be
obtained for transportation to each health care provider.

Failure to secure approval from the Out-of-State Coordinator can result in
non-payment from the DMAP.

Insurance Co-Payments

DMAP recipients may also be covered by plans such as BC/BS's Total Health
Plus, CIGNA's Healthplan of Delaware, and Healthcare of Delaware, as well
as other HMOs. etc. Under these kinds of plans, the patients choose a
primary care physician who provides total care. The
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primary care physician refers patients to member specialists when
necessary. There is frequently a co-pay amount incurred for all sick office
visits, emergency room visits, specialist visits, etc.

In those instances where a Medicaid recipient is also covered by a plan for
which payment of the above mentioned co-pays is required, the DMAP will
cover the applicable co-pay amounts. (co-pays are differentiated from
amounts are not to be confused with "non-covered" or "non-allowed"
charges.)

Any person who is a member of an accessible managed care organization must
use the services of the accessible managed care organization. Refer to the
Accessible Managed Care Insurance Carriers section of the General Policy.

There is a specific Level III HCPCS procedure codes that is used when
billing the DMAP for co-pay amounts. See APPENDIX A for the Level III HCPCS
procedure code for transportation co-pay.

When billing the DMAP for co-pay amounts, refer to Appendix A for the
Specific Level III HCPCS procedure code for transportation co-pay.

When billing the DMAP for co-pay the transportation provider must complete
the HCFA 1500 as instructed in the Billing Section with the following
exceptions:

· Enter the appropriate HCPCS co-pay procedure code in block 24D rather
than the HCPCS procedure code for the actual service provided.

· Enter only the co-pay amount in block 24F. Do not enter your usual and
customary charge nor add in any non-allowed charges.

· Leave block 29 blank. Do not enter the capitation amount, do not carry
over the co-pay amount as a balance due, and do not enter a percentage of
the capitation payment in an effort to apply it to the service provided.

· A copy of the payment voucher MUST be attached to the HCFA 1500.

II. PROVIDER PARTICIPATION SPONSIBILITIES

The DMAP provides reimbursement for non-emergency transportation for
Medicaid recipients to obtain necessary medical services. As a The provider
of non-emergency transportation services, it is the responsibility of the
provider must to abide by the following policies and procedures. of the
DMAP. This includes, but is not limited to:

· Providers may bill only for transportation services rendered to Medicaid
recipients (and escorts, as required) to receive necessary medical care
that is covered by DMAP.

· The providers must is responsible for maintaining all state-and/or
locally required insurance coverage for the protection of its fleet,
clients, and personnel, and upon request, furnish the DMAP with proof of
this coverage.

· Providers must install seat belts and/or shoulder straps, to be worn by
Medicaid recipients. The vehicle operators shall be instructed to refuse to
operate the vehicle as long as any occupant is not wearing seat belts
and/or shoulder straps.

· The providers must is responsible for maintaining current licenses,
permits, or certifications as required by all levels of government in
Delaware for operation of a vehicle(s). This includes, but is not limited
to, vehicle license, driver's license, and business license.

· The providers will is responsible to provide door-to-door service, and
when necessary, the operator or attendant must provide will assistance to
those recipients in boarding and/or alighting from the vehicle. An
attendant is an employee of the transportation provider who in addition to
the driver is required to assist I the transport of the recipient due to
his/her physical, mental or developmental status. Providing assistance is
necessary when a recipient must be physically helped into or out of the
vehicle, residence, or the medical provider's site. Without such assistance
it would be unsafe or impossible for the recipient to reach the
destination. If it is the policy of a transportation provider not to
provide an attendant to assist recipients, it is their responsibility to
inform the recipient when completing the Mobility Limitations" line on the
Transportation Scheduling Form (see Appendix B.)

· Provider will render transportation services in late model vehicles which
will be maintained and kept in good condition at all times.

· fully disclose the extent of services provided and when required to
furnish the Department DMAP and Federal or State representatives with
information regarding transportation services. For example, Records must
include:, but, are not limited to the following:

- recipient's name, address and DMAP number;

- recipient's point of origin and destination;

- date of transportation service;

- escort's name, address, and relationship;

- number of miles traveled and mode of transportation;

- service provider's name, address and DMAP provider number;

- a copy of a properly signed approval form, when required.
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* A Transportation Scheduling Form (see Appendix B of this manual. This
form must be completed in its entirety. every line on the form must be
completed with legible and accurate information;

* A driver's log that includes the recipient's name, address, time of
pick-up, destination, and actual odometer reading.

· The providers may is responsible for billing the DMAP only for actual
loaded miles provided.

· The provider is obligated to responsible for arranging and providing
transportation services for DMAP recipients as follows:

* receive request from recipient and complete screening form . At the time
of request for transportation the provider shall complete a Transportation
Scheduling Form (see Appendix B) to accurately reflect the reason for the
transport and to detail all information received from the recipient
regarding the transport. The completion of the Transportation Scheduling
Form will assist the transportation provider with a profile of the
recipient and will help in determining the recipient's needs (if any);

- determine that the transportation is to or from a covered service;

* Verify individual's DMAP eligibility. The provider may contact Confirm to
verify an individual's eligibility;

* Obtain prior authorization if required. (see "Services Which Require
Prior Approval section of this manual);

* Schedule transportation and confirm the transport with the recipient;

* Arrive at the location timely;

* Always provide prompt and courteous service; and

* - provide service and submit claim.

* Submit a claim to the DMAP for only those services that were rendered.

The provider must maintain records to verify the services provided to
Medicaid recipients as required in the General Policy and Provider Specific
Policy.

III. MINIMUM VEHICLE STANDARDS

Client transportation vehicle safety is of primary importance during
operation of vehicles utilized by providers enrolled non-emergency
transportation providers in the DMAP. Providers of non-emergency
transportation services must adhere to these minimum standards unless the
vehicles used to transport clients are emergency ambulance vehicles. The
DMAP places particular emphasis is placed on the safety of Medicaid clients
while being transported in Medicaid reimbursed vehicles. the vehicles
transporting Medicaid clients.
Providers of non-emergency transportation services must adhere to the
following standards and must ensure that:

· A basic first aid kit is on each vehicle operated by DMAP providers.

· Providers have A regulation size Class B chemical type fire extinguisher
is on each vehicle. Extinguisher must have a visible gauge or inspection
tag reflecting annual inspections and be placed in easy reach of the
driver. The extinguisher must be mounted in a bracket located in the
driver's compartment and be readily accessible to the driver and
passenger(s). A The extinguisher's pressure gauge shall must be mounted on
the extinguisher so as to be easily read without moving the extinguisher
from its mounted position. The operating mechanism shall be sealed with a
type of seal which that will not interfere with the use of the fire
extinguisher.

· Passengers will wear Seat belts and/or shoulder straps are installed in
all vehicles .at all times with only one passenger per belt where
applicable. For children, see, "Vehicles Transporting Children".

· Passengers will be seated while vehicle is in motion.

· Passengers unable to care for themselves will not be left unattended in
the vehicle.

· Passenger occupancy for adults will not exceed the vehicle manufacturer's
approved seating occupancy.

· Vehicle will be parked or stopped so that passengers will not have to
cross the street to get their destination or pickup point.

· Vehicle interior and exterior will be free of hazardous debris or
unsecured items.

· Interior vehicle equipment will be secured at all times.

· Vehicles will be operated by driver's who possess appropriate licenses
and current training.

· Vehicles will be operated within manufacturer's safe operating standards
at all times.

· There will be no smoking by drivers or passengers.

· Vehicles will display a Company Identification when transporting DMAP
clients.

· Non-Emergency ambulance vehicles will meet or exceed standards required
by the appropriate state licensing authority.

· Vehicles used to provide service shall be licensed, registered and
insured according to State regulations.

· Transportation services are rendered in vehicles that are maintained and
kept in good condition at all times.

Vehicles Transporting Mobility Impaired Clients

Additional policies for these clients are: In addition to the vehicle
standards previously mentioned, providers of non-emergency transportation
services who transport mobility impaired clients must provide the
following:
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· Safe physical arrangements will must be available for the transportation
of clients in wheelchairs. and clients requiring a stretcher. The
wheelchair or stretcher must be secured to the vehicle at all times while
the vehicle is in motion.

· Vehicles are handicap accessible, for example:

* Ramps must be available to provide easy access for a wheelchair to enter
and exit the vehicle; and

* Doors of the vehicle must be wide enough to accommodate a wheelchair.

Vehicles Transporting Children

Additional policies for these clients are: The following are additional
policies for non-emergency transportation providers who transport children:

· An approved infant or child car seat or other specially adapted seating
appropriate to age and size of child must be utilized for transporting
children. The provider shall must exercise reasonable care that its infant
or child car seats or other specially adapted seating are safe.

· The provider shall must assume responsibility for children transported
without an escort from time and place of pickup until delivered to parents,
guardians or responsible person(s) designated by parents or guardians.

· Passenger windows will not be opened more than 50% when children are in
transport.

IV. MINIMUM DRIVER STANDARDS

General Safety

The first responsibility is the safety need of the client. Immediately
evacuate passengers from vehicles in case of fire. Prior to evacuation, in
case of an accident, evaluate injuries carefully.

Driver Qualifications

Driver's must be qualified by the minimum standards listed below as
applicable:

Drivers of medical transportation vehicles are responsible for the
following general safety standards:

· Drivers will possess a current state license and appropriate training.
All drivers who transport clients in vehicles designed to carry sixteen
(16) or more passengers including the driver are required to have a Class C
driver's license and adhere to the Delaware transportation code. The
capacity of the vehicle, not the number of persons carried is the
controlling factor.

· Drivers must have a pre-employment health screening and a physical
examination by a physician within six weeks of initial employment, or date
of assignment to a driver's
position, with an annual review of health status. Providers must use all
appropriate means to assure that all drivers employed are drug and alcohol
free while transporting DMAP clients.

· Valid documentation of a driver's previous training record must be
obtained prior to employment to assist in assuring that the applicant has a
safe and competent driving history. For three years prior to employment,
drivers must not have D.U.I. (driving under influence) convictions or
license revocation. Valid documentation of driving record must be obtained
annually thereafter.

· Drivers must receive training in the operation of all vehicle equipment,
first aid, CPR, emergency exits, fire extinguishers, wheelchair lifts,
stretchers, lockdowns, etc. This certification shall include training in
passenger handling techniques, e.g., wheelchair movement and securement;
stretcher loading; boarding assistance; etc. Training must also be given on
patient confidentiality. Documentation of this training must be kept in the
provider's files with proof of annual review.

· Drivers must complete training such as defensive driving within six
months of initial employment with review as set by State of Delaware Safety
Council.

· All drivers must practice safe driving, observe all Public Safety traffic
laws and driving courtesy.

· Drivers and passengers must wear seat belts at all times as required by
Delaware law. For children, see "Vehicles Transporting Children".

· Drivers must maintain a professional manner with all DMAP clients at all
times.

· Drivers should present valid Provider issued identification to DMAP
passengers at the time service is rendered.

· The driver must refuse to operate the vehicle as long as any occupant is
not wearing a seat belt and/or a shoulder strap as required by Delaware
law. Passengers must wear a seat belt at all times with only one passenger
per belt where applicable. For children, see "Vehicles Transporting
Children" section of this manual.

· The driver must insist that all passengers be seated while the vehicle is
in motion.

· The driver must park or stop the vehicle so that passenger will not have
to cross the street to get to their destination or pickup point.

· The driver must not permit smoking by passengers. The driver is also
expected to refrain from smoking while transporting DMAP recipients.

· The driver must not leave passengers who are unable to care for
themselves unattended in the vehicle.

Driver Qualifications

Enrolled transportation providers who employ drivers and/or sub-contract
with drivers are responsible for the
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following driver qualifications:

Drivers (employed or sub-contracted) must be qualified by the standards
listed below (as applicable):

· Drivers (employed or sub-contracted) must possess a current state license
and appropriate training. All drivers who transport clients in vehicles
designed to carry sixteen (16) or more passengers including the driver are
required to have a Class C driver's license and adhere to the Delaware
transportation code. The capacity of the vehicle not the number of persons
carried is the controlling factor.

· Drivers (employed or sub-contracted) must have a pre-employment health
screening and a physical examination by a physician within six weeks of
initial employment, or date of assignment to a driver's position, with an
annual review of health status. Providers must use all appropriate means to
assure that drivers (employed or sub-contracted) are drug and alcohol free
while transporting DMAP clients.

· Valid documentation of a driver's (employed or sub-contracted) previous
training record must be obtained prior to employment to assist in assuring
that the applicant has a safe and competent driving history. For three
years prior to transporting Medicaid clients, drivers (employed or
sub-contracted) must not have D.U.I. (driving under the influence)
convictions or license revocation for D.U.I., or must not have three moving
traffic violations on his/her driving record. Valid documentation of
driving record must be obtained annually thereafter.

· vehicle equipment, first aid, CPR, emergency exits, fire extinguishers,
wheelchair lifts, lockdowns, etc. This certification must include training
in passenger handling techniques, e.g., wheelchair movement and securement,
boarding assistance, etc. Training must also be given on patient
confidentiality. Documentation of this training must be kept in the
provider's files with proof of annual review.

· All drivers (employed or sub-contracted) must complete training such as
defensive driving with six months of initial employment with review as set
by the State of Delaware Safety Council.

· Drivers (employed or sub-contracted must maintain a professional manner
with DMAP clients at all times.

At the time transportation services are rendered, drivers (employed or
sub-contracted) drivers should present a valid "provider issued"
identification to DMAP passengers. A current picture of the driver must
appear on the identification.

V. OPERATIONAL REQUIREMENTS

Providers must maintain office records which address the operational
requirements

listed below:

· Service Policies:

* Hours/days of service

* Booking/dispatch procedures

* Conditions for denial of service

* Complaint procedures

* Incident reports

* Waiting time provisions

* Attendant/escort provisions

* Miscellaneous operating regulations (e.g., smoking aboard vehicles)

* Entering client homes

* Stopping enroute for client's convenience

* Emergency procedures

* Passenger handling (wheelchair, stretcher, number of attendants, seat
belts, weight restrictions, etc.

· Personnel Policy:

* Discipline procedures for safety violations, passenger mishandling and
training programs.

* Provider must maintain and enforce policy regarding employee drug and
alcohol use.

· Equipment Policies:

* Specifications (vehicle type, auxiliary equipment);

* Maintenance procedures;

* Replacement policy.

· Vehicle Maintenance:

* Maintenance records must be kept on all vehicle.

* Vehicle maintenance and safety checks must be done monthly.

* Maintenance and records must comply with Delaware Department of Motor
Vehicle (DMV) standards and inspections.

Providers must have documentation of vehicles modified to adapt to
alternate modes of service, e.g., passenger van converted to non-emergency
ambulance, wheelchair lifts added, etc., and remain within the codes and
regulations of the State of Delaware's DMV.

VI. REIMBURSEMENT

Non-emergency medical transportation providers, except taxi providers, are
reimbursed a prospective rate per mile based on reported historic costs
(cost reports).

Non-emergency medical transportation by taxi is reimbursed at the metered
rate.

Reimbursement includes all vehicles, drivers, dispatch, vehicle
maintenance, fuel, lubricants, and all components necessary to provide
medical transportation services.
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HOME AND COMMUNITY BASED WAIVER FOR THE MENTALLY RETARDED PROVIDER SPECIFIC
POLICY

Health care services are provided to the majority of Medicaid clients
through a Managed Care Organization (MCO). This manual reflects the
policies as they relate to Medicaid clients who are exempt from managed
care coverage or who may require practitioner orders to receive services
outside the MCO package (see list of those exempt from managed care
coverage in the Managed Care section of the General Policy). However, Home
and Community-Based Services (HCBS) waiver clients are exempt from managed
care coverage. Services provided to clients eligible for HCBS waiver
services will be reimbursed on a "fee-for-service" basis.

I. DEFINITION AND OVERVIEW

The waiver to provide home and community based services to mentally
retarded adults was developed by the Divisions of Mental Retardation
(DMR)and Social Services (DSS) in 1982 and received approval from the
Health Care Financing Administration (HCFA) and became effective on July 1,
1983. The waiver includes support services necessary to maintain
individuals in the community as an alternative to institutionalization. The
cost of the Home and Community-Based Services Waiver for the Mentally
Retarded (HCBS/MR) shall not exceed the cost of care of the Intermediate
Care Facility for the Mentally Retarded (ICF/MR).

VI. CONTENT/DESCRIPTION OF SERVICES

When billing the DMAP for HCBS/MR services, the provider must use their
unique MR provider ID number that ends with "56". The procedure codes to be
used for billing services under the Home and Community-Based Waiver for the
Mentally Retarded are listed in Appendix A.

Services provided under the HCBS/MR waiver include:

Case Management Services

Case management services include responsibility for locating, managing,
coordinating and monitoring:

· All proposed waiver services;

· Other State Plan services;

· Needed medical, social, educational and other publicly-funded services
(regardless of funding source); and,

· Informal community supports needed by eligible persons.

The intent of case management services is to enable waiver participants to
receive a full range of appropriate services in a planned, coordinated,
efficient and effective manner.

Case management services consist of the following activities:

· Arranging for the provision of services;

· Initiation and oversight of the process of assessment and reassessment of
program participant level of care and yearly review of plans of care;

· Determination and monitoring the cost-effectiveness of the provision of
home and community services;

· Monitoring and review of waiver participant's services;

· Service coordination;

· Crisis intervention;

· Case planning;

· Assessment and referral; and,

· Follow-along to ensure quality of care and case reviews when focus on the
individual's progress in meeting goals and objectives established through
the care plan.

Case Management is administered by qualified mental retardation
professional staff who meet the minimum requirements for job specifications
as set forth by the State of Delaware Personnel Commission and outlined in
the Merit System Procedure Manual.

Clinical Support

Clinical support includes physician services, home health care services,
physical therapy services, occupational therapy services, speech, hearing
and language services and prescribed drugs.

Clinical evaluation and consultation is administered by staff meeting the
minimum requirements for job specifications as set forth by the State of
Delaware Personnel Commission and outlined in the Merit System Procedure
Manual.

Day Habilitation

Day habitation includes assistance with acquisition, retention, or
improvement in self-help, socialization and adaptive skills which takes
place in a non-residential setting, separate from the home or facility in
which the recipient resides. Services shall normally be furnished four (4)
or more hours per day on a regularly scheduled basis for one (1) or more
days per week, unless provided as an adjunct to other day activities
included in the recipient's plan of care. Day habilitation services shall
focus on enabling the individual to attain his or her
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maximum functional level, and shall be coordinated with any physical,
occupational, or speech therapies listed in the plan of care. In addition,
day habilitation services may serve to reinforce skills or lessons taught
in school, therapy, or other settings.

Residential Habilitation

Residential Habilitation (State definition) is a continuum of settings
where specialized training and supervision is provided within the following
community residential settings:

· neighborhood group homes;

· specialized foster care programs;

· foster training homes

· staffed apartments; and,

· supervised apartments.

Training services in these settings are provided in accordance with an IPP
which has been designed in the client assessment. The objectives of the
residential habilitation services are to:

· address functional needs by modifying inappropriate behavior and
enhancing beneficiary competence;

· address physical needs by promoting proper diet, exercise and health care
by taking the necessary action to remedy an impairment as soon as possible
after it occurs, and by assisting the beneficiary to adapt to an
impairment;

· address emotional needs by strengthening the client's self-image, by the
development of constructive relationships and by counseling supports if
necessary;

HOSPICE PROVIDER SPECIFIC POLICY MANUAL

II. HOSPICE SERVICES

Hospice services will be provided in accordance with Sections 4305 through
4307 of the State Medicaid Manual. This part of the State Medicaid Manual
is reproduced in its entirety in APPENDIX A of this manual.

An individual may elect to receive hospice care during one or more of the
following election periods:

· An initial 90 day period.

· A subsequent 90 day period.

· A subsequent 30 day period.

· A subsequent extension period of unlimited duration during the
individual's lifetime.

· Unlimited number of subsequent 60 day periods.

The periods of care are available in the order listed and may be elected
separately at different times.

PRACTITIONER PROVIDER SPECIFIC POLICY

Practitioner Laboratories

General Information

The DMAP reimburses enrolled providers for properly ordered, medically
necessary, non-experimental, non-investigational, Clinical Laboratory
Improvement Amendments (CLIA) certified laboratory services when properly
performed, documented, and billed.

All tests performed by a practitioner in his/her laboratory must be
documented by a written order from the ordering practitioner. The signing
of the practitioner's name by another individual or the use of facsimiles
are not acceptable. Any telephone order for laboratory testing must be
supported by a signed order from the practitioner.

As a result of Public Law 98-369, the DMAP prohibits practitioners from
billing for clinical diagnostic laboratory tests that are not personally
performed or supervised by the practitioner start-to-finish in his/her
office. The following policies apply:

· Practitioners may only bill the program for those laboratory procedures
which they personally perform or supervise start-to-finish in their office.

· Laboratory procedures which the practitioner refers to an outside
laboratory must be billed by the laboratory.

· Interpretation of laboratory results or the taking of blood or other
specimens is considered part of the visit and may not be charged as a
separate procedure by the practitioner.

CLIA

The Clinical Laboratory Improvement Amendments of 1988 were enacted by
Congress to improve the quality and reliability of clinical laboratory
testing. CLIA applies to any provider who performs any laboratory test used
for health purposes, no matter how simple or routine.

CLIA Certificate of Waiver Tests

The following Clinical diagnostic laboratory tests are considered to be
CLIA Certificate of Waiver tests are listed in Appendix H. These are the
only HCPCS procedure codes that may be billed to the DMAP by a provider who
holds a CLIA Certificate of Waiver. If there is a specific product name or
manufacturer listed, a provider who holds a CLIA Certificate of Waiver may
only bill if the test is done USING THE SPECIFIC PRODUCT AND MANUFACTURER
AS LISTED.
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CODE DEFINITION PRODUCT MANUFACTURER

NAME

*80002 Glucose; Cholestech LDX Cholestech

effective quantitative

1/23/96

*80002 Triglycerides Cholestech LDX Cholestech

effective

1/23/96

*80002 Cholesterol, 1. Chemtraka 1. Chemtrak

effective total Accumeter 2. Johnson &

1/1/97 2. Advanced Care 3. Boehringer

(replaces 3. Boehringer Mannheim

G0054) Mannheim

AccuChek Instant

Plus Cholesterol 4. Cholestech

4. Cholestech LDX

81002 Urinalysis,

by dipstick Various Various or tablet reagent

for bilirubin,

glucose,

hemoglobin,

ketones,

leukocytes,

nitrite, pH,

protein, specific

gravity,

urobilinogen, any

number of these

constituents; non

automated, without

microscopy

81025 Urine pregnancy Various Various

test, by visual

color comparison

methods

82044

effective

1/23/96 Albumin; urine, Boehringer Boehringer

microalbumin, Mannheim Mannheim

semiquantitative Chemstrip Micral

(eg, reagent strip

assay)

82270 Blood, occult; Various Various

feces screening,

1-3 simultaneous

determinations

82273 Blood, occult; SmithKline

effective other sources, Gastroccult SmithKline

1/23/96 qualitative

82950 Glucose; post HemoCue B

effective glucose Glucose

1/1/97 dose (includes Photometer HemoCue

(replaces glucose)

G0055)

82951 Glucose; tolerance HemoCue B-

effective test (GTT), three Glucose

1/1/97 specimens (includes Photometer HemoCue

(replaces glucose)

G0056)

*If one (1) or two (2) of these tests are done, the provider must bill
procedure code 80002 with one (1) unit. If all three (3) of these tests are
done, the provider must bill procedure code 80003 with one (1) unit.

CODE DEFINITION PRODUCT MANUFACTURER

NAME

82952 Glucose; tolerance HemoCue B HemoCue

effective test, each additional Glucose

1/1/97 beyond three Photometer

(replaces specimens

G0057)

82962 Glucose, blood by Various Various

glucose monitoring

device(s) cleared by

the FDA specifically

for home use

83026 Hemoglobin; by Various Various

copper sulfate

method, non

automated

83718 Lipoprotein, direct Cholestech LDX Cholestech effective measurement;
high

1/23/96 density cholesterol

(HDL cholesterol)

83986 pH, body fluid, Various Various

effective except blood. Using

1/23/96 qualitative color

comparison

85013 Blood count; spun Various Various

microhematocrit

85018 Blood count; Hemoglobin by HemoCue

effective hemoglobin single instrument

1/1/97 with self-contained

(replaces or component

Q0116) features to perform

specimen/reagent

interaction,

providing direct

measurement and

readout

85651 Sedimentation rate, Various Various

erythrocyte; non

automated

86588 Streptococcus, Quick Vue In-Line

effective screen, direct One-Step Strep Quidel

1/23/96 A Test
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87072 Culture or direct Serim Pyloritek

effective bacterial identification Test Kit Serim

1/23/96 method, each organism,

by commercial kit, any

source except urine

NOTE: The DMAP does not cover any services relating solely to the treatment
of infertility. Therefore, the following waiver test is not reimbursable by
the DMAP:

84830 Ovulation tests, by visual color comparison methods for human
luteinizing hormone

CLIA Certificate for Provider-Performed Microscopy Procedures (PPMP)

The following Clinical diagnostic laboratory tests are considered CLIA
provider-performed microscopy procedures are listed in Appendix I. A
provider who holds a CLIA Certificate for Provider-Performed Microscopy may
bill the DMAP for the following procedures in addition to the Certificate
of Waiver tests.

81000 Urinalysis, by dipstick or tablet reagent for bilirubin, glucose,
hemoglobin, ketones, leukocytes, nitrite, pH, protein, specific gravity,
urobilinogen, any number of these constituents; non-automated, with
microscopy

81015 Urinalysis; microscopic only

89190 Nasal smear for eosinophils

G0026 Fecal leukocyte examination

NOTE: The DMAP considers the following provider-performed microscopy
procedures to be part of the physician evaluation and management service.
Therefore, the following are not separately reimbursable by DMAP:

Q0111 Wet mounts, including preparations of vaginal, cervical or skin
specimen

Q0112 All potassium hydroxide (KOH) preparations

Q0113 Pinworm examinations

NOTE: The DMAP does not cover any services relating solely to the treatment
of infertility. Therefore, the following provider-performed microscopy
procedures are not reimbursable by DMAP:

Q0114 Fern test

Q0115 Post-coital direct, qualitative examinations of vaginal or cervical
mucous

G0027 Semen analysis; presence and/or motility of sperm excluding Huhner
test

CLIA Certificate of Registration Tests that DO NOT Require Additional
Certification by the DMAP

A practitioner who holds a CLIA Certificate of Registration may bill the
DMAP for the following some routinely performed clinical diagnostic
laboratory tests in addition to both the Certificate of Waiver tests and
the Provider-Performed Microscopy procedures without These tests do not
require additional certification by the DMAP. Refer to Appendix J for a
list of appropriate HCPCS procedure codes.

NOTE: Skin tests (86485-86586) are not considered to be clinical diagnostic
laboratory tests and are, therefore, not monitored by CLIA.

80002 Automated multichannel test; 1 or 2 clinical chemistry tests

80003 Automated multichannel test; 3 clinical chemistry tests

80004 Automated multichannel test; 4 clinical chemistry tests

80005 Automated multichannel test; 5 clinical chemistry tests

80006 Automated multichannel test; 6 clinical chemistry tests

80007 Automated multichannel test; 7 clinical chemistry tests

80008 Automated multichannel test; 8 clinical chemistry tests

80009 Automated multichannel test; 9 clinical chemistry tests

80010 Automated multichannel test; 10 clinical chemistry tests

80011 Automated multichannel test; 11 clinical chemistry tests

80012 Automated multichannel test; 12 clinical chemistry tests

81001 Urinalysis, by dip stick or tablet reagent for bilirubin, glucose,
hemoglobin, ketones, leukocytes, nitrite, pH, protein, specific gravity,
urobilinogen, any number of these constituents; automated, with microscopy

81003 Urinalysis, by dip stick or tablet reagent for bilirubin, glucose,
hemoglobin, ketones, leukocytes, nitrite, pH, protein, specific gravity,
urobilinogen, any number of these constituents; automated, without
microscopy

81005 Urinalysis; qualitative or semiquantitative, except immunoassays

82044 Albumin; urine, microalbumin, semiquantiative (eg, reagent strip
assay)

82273 Blood, occult; other sources, qualitative

82948 Glucose; blood, reagent strip

82950 Glucose; post glucose dose (includes glucose)

82951 Glucose; tolerance test (GTT), three specimens (includes glucose)

82952 Glucose; tolerance test, each additional beyond three specimens

83718 Lipoprotein, direct measurement; high density cholesterol (HDL
cholesterol)

83986 pH, body fluid, except blood

84525 Urea nitrogen; semiquantitative (eg, reagent strip test)

84703 Gonadotropin, chorionic (hCG); qualitative

85014 Blood count; other than spun hematocrit

85018 Blood count; hemoglobin

85021 Blood count; hemogram, automated (RBC, WBC, Hgb, Hct and indices
only)

85022 Blood count: hemogram, automated, and manual differential
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WBC count (CBC)

85023 Blood count; hemogram and platelet count, automated, and manual
differential WBC count (CBC)

85027 Blood count; hemogram and platelet count, automated

85031 Blood count; hemogram, manual, complete CBC (RBC, WBC, Hgb, Hct,
differential and indices)

85044 Blood count; reticulocyte count, manual

85048 Blood count; white blood cell (WBC)

85585 Platelet; estimation on smear, only

85590 Platelet; manual count

85595 Platelet; automated count

86063 Antistreptolysin O; screen

86280 Hemagglutination inhibition test (HAI)

86308 Heterophile antibodies; screening

86403 Particle agglutination, screen, each antibody

86430 Rheumatoid factor; qualitative

86588 Streptococcus, screen, direct

86592 Syphilis test, qualitative (eg, VDRL, RPR, ART)

87072 Culture or direct bacterial identification method, each organism, by
commercial kit, any source except urine

87081 Culture, bacterial, screening only, for single organisms

87082 Culture, presumptive, pathogenic organisms, screening only, by
commercial kit (specify type); for single organisms

87083 Culture, presumptive, pathogenic organisms, screening only, by
commercial kit (specify type); multiple organisms

87086 Culture, bacterial, urine; quantitative, colony count

87087 Culture, bacterial, urine; commercial kit

87101 Culture, fungi, isolation (with or without presumptive
identification); skin

87102 Culture, fungi, isolation (with or without presumptive
identification); other source (except blood)

87205 Smear, primary source, with interpretation; routine stain for
bacteria, fungi, or cell types

87208 Smear, primary source, with interpretation; direct or concentrated,
dry, for ova and parasites

87220 Tissue examination for fungi (eg, KOH slide)

A practitioner who holds a CLIA Certificate of Registration and has a
specialty of rheumatology may also bill the DMAP for the following
routinely performed tests without Medicaid certification.

83872 Mucin, synovial fluid (Ropes test)

89060 Crystal identification by light microscopy with or without polarizing
lens analysis, any body fluid (except urine)

CLIA Certificate of Registration Tests that DO Require Additional
Certification by the DMAP

Any other clinical diagnostic laboratory tests performed start-to-finish in
a practitioner's office require BOTH a CLIA Certificate of Registration and
certification by the Medicaid Laboratory Consultant.

To request this certification, submit a letter to:

Medicaid Laboratory Consultant

Division of Social Services

P.O. Box 906

Lewis Building

New Castle, DE 19720

with the following information:

· Describe the office procedure from start to finish in detail. You may
enclose a copy of the package insert for commercial kits.

· Enclose a sample of how your test results will be recorded in your office
record.

· Indicate your CLIA Certificate of Registration Number.

· Indicate the name of the physician(s) who will personally perform or
supervise the laboratory procedure and include the DMAP provider ID
number(s) which will be used for billing.

This information should not be submitted with a claim. When the laboratory
consultant has certified your practice to perform the procedure, you will
receive a certification letter.

If a claim is submitted for a HCPCS procedure code that requires
certification and the practitioner has not followed the above outlined
procedure, the claim will be denied with the message "Provider Not
Specified to Provide Service." Once a particular HCPCS procedure code has
been denied with this message, do not resubmit additional claims for this
procedure code until the above noted procedure is complete.

Refer to Appendix K for specific billing instructions for:

· Multiple Units Of Service

· Pregnancy Tests

· Panels and Profiles

· Drug Testing

· Therapeutic Drug Assays

· Urinalysis

· Chemistry and Toxicology

· Hematology

· Immunology

· Microbiology

Multiple Units of Service

The following restrictions apply when billing for multiple units of
service:

· Repetition of the same test on the same specimen must
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not be billed.

· When the same test is performed on separate specimens collected on the
same day from the same patient, bill for multiple units of the appropriate
HCPCS procedure code. In block 19 of the HCFA 1500 which is used to explain
unusual services or circumstances, note the times that the specimens were
collected.

EXAMPLE: If a glucose is drawn at 8 AM and again at 2 PM on the same day,
bill for two units of 80002. In block 19 of the HCFA 1500, note that the
specimens were collected at 8 AM and 2 PM.

· When different procedures are described by one HCPCS procedure code, bill
for multiple units of service. In block 19 of the HCFA 1500 which is used
to explain unusual services or circumstances, identify the procedures
performed.

EXAMPLE: When both a wound culture and an eye culture are performed on the
same day, bill for two units of 87070. In block 19 of the HCFA 1500, state
that one wound culture and one eye culture were performed.

Pregnancy Tests

The following restrictions apply:

· HCPCS procedure code 81025 (Urine pregnancy test, by visual color
comparison methods) should be used for pregnancy tests performed on urine
samples that are reported as positive or negative by a visual color
comparison.

· HCPCS procedure code 84703 [Gonadotropin, chorionic (hCG); qualitative]
should be used for pregnancy tests reported as positive or negative.

· HCPCS procedure code 84702 [Gonadotropin, chorionic (hCG); quantitative)
should be used when determining the range of values of the beta sub-unit of
the chorionic gonadotropin. DO NOT USE THIS CODE FOR ROUTINE PREGNANCY
TESTS.

Panels And Profiles (80002-80090)

Panels or profiles are groups of laboratory tests that are performed and
billed as a single unit. Practitioners must use the appropriate single
procedure code that describes the group of tests being performed.

The individual HCPCS procedure codes for the 22 tests listed below are NOT
used by the DMAP:

Name of Test Individual HCPCS

Procedure Codes

Which Are Not Used

Alanine aminotransferase (ALT, SGPT) 84460

Albumin 82040

Aspartate aminotransferase (AST, SGOT) 84450

Bilirubin; direct 82250, 82251

Bilirubin; total 82250, 82251

Calcium 82310

Carbon dioxide content 82374

Chloride 82435

Cholesterol 82465

Creatine kinase (CK, CPK) 82550

Creatinine 82565

Glucose (Sugar) 82947

Gammaglutamyltransferase (GGT) 82977

Lactic dehydrogenase (LD) 83615

Phosphatase, alkaline 84075

Phosphorus (inorganic phosphate) 84100

Potassium 84132

Protein, total 84155, 84160

Sodium 84295

Triglyceride 84478

Urea nitrogen (BUN) 84520

Uric acid 84550

When reporting any of these 22 tests, regardless of whether the tests are
performed using manual or semi-automated methods, or on automated
multichannel equipment, use the appropriate profile code 80002 - G0060
listed below:

USE THESE CODES:

80002 Automated multichannel test; 1 or 2 clinical chemistry tests

80003 Automated multichannel test; 3 clinical chemistry tests

80004 Automated multichannel test; 4 clinical chemistry tests

80005 Automated multichannel test; 5 clinical chemistry tests

80006 Automated multichannel test; 6 clinical chemistry tests

80007 Automated multichannel test; 7 clinical chemistry tests

80008 Automated multichannel test; 8 clinical chemistry tests

80009 Automated multichannel test; 9 clinical chemistry tests

80010 Automated multichannel test; 10 clinical chemistry tests

80011 Automated multichannel test; 11 clinical chemistry tests

80012 Automated multichannel test; 12 clinical chemistry tests

80016 Automated multichannel test; 13 - 16 clinical chemistry tests

80018 Automated multichannel test; 17 - 18 clinical chemistry tests

80019 Automated multichannel test; 19 clinical chemistry tests

G0058 Automated multichannel test; 20 clinical chemistry tests

G0059 Automated multichannel test; 21 clinical chemistry tests

G0060 Automated multichannel test; 22 clinical chemistry tests

EXAMPLE: If a BUN and a glucose were run on the same specimen, the correct
code would be one unit of 80002. If only a glucose was ordered, the correct
code would still
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be one unit of 80002. If a glucose was run a 9 AM and again at 2 PM on the
same day on different specimens, two units of 80002 would be billable.

EXAMPLE: If five of the above tests are ordered, the correct code would be
one unit of 80005. Fifteen tests would be billed as one unit of 80016 while
twenty-one tests would be one unit of G0059. In each case, the unit of
service would be one, not the number of tests actually performed.

Drug Testing (80100-80103)

HCPCS procedure code 80100 (Drug, screen; multiple drug classes, each
procedure) should be used for a qualitative drug screen that detects
multiple drug classes in a single procedure. HCPCS procedure code 80101
(Drug, screen; single drug class, each drug class) should be used for a
qualitative drug screen that detects a single drug class. HCPCS procedure
code 80102 (Drug, confirmation, each procedure) should be used for
confirmation (by a second method) of any drugs detected in a drug screen.

HCPCS procedure code 83518 (Immunoassay for analyte other than antibody or
infectious agent antigen, qualitative or semiquantitative; single step
method [eg, reagent strip]) should be used for a qualitative or
semiquantitative immunoassay of an analyte other than an antibody. This
includes quick screens, using low technology testing (e.g., reagent strips,
dip stick, etc.).

Confirmed drugs may be quantitated using the appropriate code in the
chemistry section (82000-84999) or therapeutic drug assay section
(80150-80299).

Therapeutic Drug Assays (80150-80299)

Use the specific procedure code listed in the CPT book for individual
quantitative assay. For non quantitative testing, use codes 80100-80103.

Urinalysis (81000-81099)

Code 81000 is described as a complete urinalysis, non-automated. Code 81001
is a complete urinalysis, automated. Neither is to be used in conjunction
with the following HCPCS procedure codes: 81002, 81003, 81005, and 81015.
Any stick, dip, or tablet tests performed on a single specimen are
considered to be part of the 81000 or 81001 and are not eligible for
separate reimbursement. In order to bill for an 81000 or 81001, a
microscopy must be performed.

Chemistry And Toxicology (82000-84999)

When billing for any specific chemistry test that is noted under the list
of automated, multichannel tests, do not use the individual HCPCS procedure
codes regardless of whether the tests are performed using manual methods or
automated, multichannel equipment. The practitioner should bill using the
appropriate profile code.

Hematology (85000 - 85999)

When billing codes for a complete blood count (CBC) or hemogram, identified
as HCPCS procedure codes 85021, 85022, 85023, 85024, 85025, 85027, or
85031, do not bill for any code that is a component of a CBC for the same
specimen. The following are the HCPCS procedure codes for components:
85007, 85008, 85013, 85014, 85018, 85029, 85030, 85041, 85048, 85585,
85590, and 85595.

Providers are reminded not to use multiple procedure codes when a single
procedure code accurately describes the service rendered.

Immunology (86000 - 86999)

When there is no specific code for an immunology procedure, the code for
the methodology is to be used. Certain codes can be used to describe many
different tests. When two or more different tests are described by the same
code and are performed on the same patient on the same day, bill on a
single line using multiple units of service. Identify the procedures
performed in Block 19 of the HCFA 1500, which is used to explain unusual
services or circumstances.

Microbiology (87001 - 87999)

The following policies apply:

· A definitive culture is one in which ALL probable pathogens are isolated
and identified. Commercial kits are not considered to be definitive culture
methods.

EXAMPLE: When billing code 87060 (Culture, bacterial, definitive; throat or
nose), the practitioner is expected to be able to isolate and identify
Haemophilus, gram negative rods, staphylococci, pneumococci, and other
probable naso-pharyngeal pathogens in addition to beta hemolytic
streptococci.

· A presumptive or screening culture is one in which a single pathogen is
isolated but may or may not be definitively identified.
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EXAMPLE: When a throat culture is screened for the presence or absence of
group A beta streptococci using a low concentration bacitracin disc, bill
for one unit of 87081. Identification aids such as bacitracin and neomycin
discs are considered part of the screen and should not be billed in
addition to the 87081.

EXAMPLE: When a genital culture is screened for the presence or absence of
Neisseria gonorrhea (GC), bill for one unit of 87081.

· Commercial kits are self-contained microbiology systems that offer
screening information on one or more probable pathogens. HCPCS procedure
codes for commercial kits are found in the microbiology section of the CPT
book. Cultures performed using commercial kits are not considered
definitive. In block 19 of the HCFA 1500 which is used to explain unusual
services or circumstances, identify the commercial kit used.

EXAMPLE: When a culture of the urethra for Neisseria gonorrhea (GC) is
performed using the Isocult commercial kit for gonorrhea, bill for one unit
of HCPCS procedure code 87082. In block 19 of the HCFA 1500, note that
Isocult was the commercial kit used.

· Direct sensitivities are not reimbursable. A direct sensitivity is
inoculated directly from the specimen at the time of the initial culture.
DO NOT use HCPCS procedure codes 87181, 87184, 87186, or 87188 to describe
direct sensitivities. Sensitivities will only be reimbursed after a
pathogen has been isolated and set up for sensitivities.

· HCPCS procedure code 87088 is described as a culture, bacterial, urine;
identification, in addition to quantitative or commercial kit. It is not to
be used in conjunction with procedure code 87086 (Culture, bacterial,
urine; quantitative, colony count) or with procedure code 87087 (Culture,
bacterial, urine; commercial kit). They are considered to be part of
procedure code 87088 when performed on the same specimen.

Laboratory Codes

HCPCS procedure codes 80002 - 80019 and G0058 - G0060 have been deleted in
the CPT book but Delaware Medicaid will continue to use this coding series
for automated multichannel testing.

The newly added 1998 CPT codes for organ or disease oriented panels will
not be used. Use the appropriate automated multichannel test in the 80002 -
80019 series. For 80049, use 80007. For 80051, use 80004. For 80054, use
80012.

INDEPENDENT LABORATORY PROVIDER MANUAL

IV. BILLING FOR SPECIFIC LABORATORY SERVICES

HCPCS procedure codes 80002-80019 and G0058-G0060 have been deleted in the
CPT book but Delaware Medicaid will continue to use this coding series for
automated multichannel testing.

The newly added 1998 CPT codes for organ or disease oriented panels will
not be used. Use the appropriate authomated multichannel test in the
8002-80019 series. For 80049, use 80007. For 80051, use 80004. For 80054,
use 80012.

CLIA Certificate of Waiver Tests

The following Clinical diagnostic laboratory tests are considered to be
CLIA Certificate of Waiver tests are listed in Appendix A. These are the
only HCPCS procedure codes that may be billed to the DMAP by a provider who
holds a CLIA Certificate of Waiver. If there is a specific product name or
manufacturer listed, a provider who holds a CLIA Certificate of Waiver may
only bill if the test is done USING THE SPECIFIC PRODUCT AND MANUFACTURER
AS LISTED.

CODE DEFINITION PRODUCT MANUFACTURER

NAME

*80002 Glucose; Cholestech LDX Cholestech

effective quantitative

1/23/96

*80002 Triglycerides Cholestech LDX Cholestech

effective

1/23/96

*80002 Cholesterol, 1. Chemtraka 1. Chemtrak

effective total Accumeter 2. Johnson &

1/1/97 2. Advanced Care 3. Boehringer

(replaces 3. Boehringer Mannheim

G0054) Mannheim

AccuChek Instant

Plus Cholesterol 4. Cholestech

4. Cholestech LDX

81002 Urinalysis,

by dipstick Various Various or tablet reagent

for bilirubin,

glucose,

hemoglobin,

ketones,

leukocytes,

nitrite, pH,

protein, specific
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gravity,

urobilinogen, any

number of these

constituents; non

automated, without

microscopy

81025 Urine pregnancy Various Various

test, by visual

color comparison

methods

82044

effective

1/23/96 Albumin; urine, Boehringer Boehringer

microalbumin, Mannheim Mannheim

semiquantitative Chemstrip Micral

(eg, reagent strip

assay)

82270 Blood, occult; Various Various

feces screening,

1-3 simultaneous

determinations

82273 Blood, occult; SmithKline

effective other sources, Gastroccult SmithKline

1/23/96 qualitative

82950 Glucose; post HemoCue B

effective glucose Glucose

1/1/97 dose (includes Photometer HemoCue

(replaces glucose)

G0055)

82951 Glucose; tolerance HemoCue B-

effective test (GTT), three Glucose

1/1/97 specimens (includes Photometer HemoCue

(replaces glucose)

G0056)

*If one (1) or two (2) of these tests are done, the provider must bill
procedure code 80002 with one (1) unit. If all three (3) of these tests are
done, the provider must bill procedure code 80003 with one (1) unit.

CODE DEFINITION PRODUCT MANUFACTURER

NAME

82952 Glucose; tolerance HemoCue B HemoCue

effective test, each additional Glucose

1/1/97 beyond three Photometer

(replaces specimens

G0057)

82962 Glucose, blood by Various Various

glucose monitoring

device(s) cleared by

the FDA specifically

for home use

83026 Hemoglobin; by Various Various

copper sulfate

method, non

automated

83718 Lipoprotein, direct Cholestech LDX Cholestech effective measurement;
high

1/23/96 density cholesterol

(HDL cholesterol)

83986 pH, body fluid, Various Various

effective except blood. Using

1/23/96 qualitative color

comparison

85013 Blood count; spun Various Various

microhematocrit

85018 Blood count; Hemoglobin by HemoCue

effective hemoglobin single instrument

1/1/97 with self-contained

(replaces or component

Q0116) features to perform

specimen/reagent

interaction,

providing direct

measurement and

readout

85651 Sedimentation rate, Various Various

erythrocyte; non

automated

86588 Streptococcus, Quick Vue In-Line

effective screen, direct One-Step Strep Quidel

1/23/96 A Test

87072 Culture or direct Serim Pyloritek

effective bacterial identifica-

1/23/96 tion method, each Test Kit Serim

organism, by

commercial kit, any

source except urine

NOTE: The DMAP does not cover any services relating solely to the treatment
of infertility. Therefore, the following waiver test is not reimbursable by
the DMAP:

84830 Ovulation tests, by visual color comparison methods for human
luteinizing hormone

CLIA Certificate for Provider-Performed Microscopy Procedures (PPMP)

The following Clinical diagnostic laboratory tests are considered CLIA
provider-performed microscopy procedures are listed in Appendix B. A
provider who holds a CLIA Certificate for Provider-Performed Microscopy may
bill the DMAP for the following procedures in addition to the Certificate
of Waiver tests.

81000 Urinalysis, by dipstick or tablet reagent for bilirubin, glucose,
hemoglobin, ketones, leukocytes, nitrite, pH,
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protein, specific gravity, urobilinogen, any number of these constituents;
non-automated, with microscopy

81015 Urinalysis; microscopic only

89190 Nasal smear for eosinophils

G0026 Fecal leukocyte examination

NOTE: The DMAP considers the following provider-performed microscopy
procedures to be part of the physician evaluation and management service.
Therefore, the following are not separately reimbursable by DMAP:

Q0111 Wet mounts, including preparations of vaginal, cervical or skin
specimen

Q0112 All potassium hydroxide (KOH) preparations

Q0113 Pinworm examinations

NOTE: The DMAP does not cover any services relating solely to the treatment
of infertility. Therefore, the following provider-performed microscopy
procedures are not reimbursable by DMAP:

Q0114 Fern test

Q0115 Post-coital direct, qualitative examinations of vaginal or cervical
mucous

G0027 Semen analysis; presence and/or motility of sperm excluding Huhner
test

CLIA Certificate of Registration Tests

An independent laboratory who holds a CLIA Certificate of Registration may
bill the DMAP for any clinical diagnostic laboratory test for which they
have received CLIA certification.

Refer to Appendix C for specific billing instructions for:

· Multiple Units of Service

· Pregnancy Tests

· Panels and Profiles

· Drug Testing

· Therapeutic Drug Assays

· Urinalysis

· Chemistry and Toxicology

· Hematology

· Immunology

· Microbiology

Multiple Units of Service

The following restrictions apply when billing for multiple units of
service:

· Repetition of the same test on the same specimen must
not be billed.

· When the same test is performed on separate specimens collected on the
same day from the same patient, bill for multiple units of the appropriate
HCPCS procedure code. In block 19 of the HCFA 1500 which is used to explain
unusual services or circumstances, note the times that the specimens were
collected.

EXAMPLE: If a glucose is drawn at 8 AM and again at 2 PM on the same day,
bill for two units of 80002. In block 19 of the HCFA 1500, note that the
specimens were collected at 8 AM and 2 PM.

· When different procedures are described by one HCPCS procedure code, bill
for multiple units of service. In block 19 of the HCFA 1500 which is used
to explain unusual services or circumstances, identify the procedures
performed.

EXAMPLE: When both a wound culture and an eye culture are performed on the
same day, bill for two units of 87070. In block 19 of the HCFA 1500, state
that one wound culture and one eye culture were performed.

Pregnancy Tests

The following restrictions apply:

· HCPCS procedure code 81025 (Urine pregnancy test, by visual color
comparison methods) should be used for pregnancy tests performed on urine
samples that are reported as positive or negative by a visual color
comparison.

· HCPCS procedure code 84703 [Gonadotropin, chorionic (hCG); qualitative]
should be used for pregnancy tests reported as positive or negative.

· HCPCS procedure code 84702 [Gonadotropin, chorionic (hCG); quantitative)
should be used when determining the range of values of the beta sub-unit of
the chorionic gonadotropin. DO NOT USE THIS CODE FOR ROUTINE PREGNANCY
TESTS.

Panels and Profiles (80002-G0060)

Panels or profiles are groups of laboratory tests that are performed and
billed as a single unit. Practitioners must use the appropriate single
procedure code that describes the group of tests being performed.

The individual HCPCS procedure codes for the 22 tests listed below are NOT
used by the DMAP.

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Name of Test Individual HCPCS

Procedure Codes Which

Are Not Used

Alanine aminotransferase (ALT, SGPT) 84460

Albumin 82040

Aspartate aminotransferase (AST, SGOT) 84450

Bilirubin; direct 82250, 82251

Bilirubin; total 82250, 82251

Calcium 82310

Carbon dioxide content 82374

Chloride 82435

Cholesterol 82465

Creatine kinase (CK, CPK) 82550

Creatinine 82565

Glucose (Sugar) 82947

Gammaglutamyltransferase (GGT) 82977

Lactic dehydrogenase (LD) 83615

Phosphatase, alkaline 84075

Phosphorus (inorganic phosphate) 84100

Potassium 84132

Protein, total 84155, 84160

Sodium 84295

Triglyceride 84478

Urea nitrogen (BUN) 84520

Uric acid 84550

When reporting any of these 22 tests, regardless of whether the tests are
performed using manual or semi-automated methods, or on automated
multichannel equipment, use the appropriate profile code 80002 - G0060
listed below:

USE THESE CODES:

80002 Automated multichannel test; 1 or 2 clinical chemistry tests

80003 Automated multichannel test; 3 clinical chemistry tests

80004 Automated multichannel test; 4 clinical chemistry tests

80005 Automated multichannel test; 5 clinical chemistry tests

80006 Automated multichannel test; 6 clinical chemistry tests

80007 Automated multichannel test; 7 clinical chemistry tests

80008 Automated multichannel test; 8 clinical chemistry tests

80009 Automated multichannel test; 9 clinical chemistry tests

80010 Automated multichannel test; 10 clinical chemistry tests

80011 Automated multichannel test; 11 clinical chemistry tests

80012 Automated multichannel test; 12 clinical chemistry tests

80016 Automated multichannel test; 13 - 16 clinical chemistry tests

80018 Automated multichannel test; 17 - 18 clinical chemistry tests

80019 Automated multichannel test; 19 clinical chemistry tests

G0058 Automated multichannel test; 20 clinical chemistry tests

G0059 Automated multichannel test; 21 clinical chemistry tests

G0060 Automated multichannel test; 22 clinical chemistry tests

EXAMPLE: If a BUN and a glucose were run on the same specimen, the correct
code would be one unit of 80002. If only a glucose was ordered, the correct
code would still
be one unit of 80002. If a glucose was run a 9 AM and again at 2 PM on the
same day on different specimens, two units of 80002 would be billable.

EXAMPLE: If five of the above tests are ordered, the correct code would be
one unit of 80005. Fifteen tests would be billed as one unit of 80016 while
twenty-one tests would be one unit of G0059. In each case, the unit of
service would be one, not the number of tests actually performed.

Drug Testing (80100-80103)

HCPCS procedure code 80100 (Drug, screen; multiple drug classes, each
procedure) should be used for a qualitative drug screen that detects
multiple drug classes in a single procedure. HCPCS procedure code 80101
(Drug, screen; single drug class, each drug class) should be used for a
qualitative drug screen that detects a single drug class. HCPCS procedure
code 80102 (Drug, confirmation, each procedure) should be used for
confirmation (by a second method) of any drugs detected in a drug screen.

HCPCS procedure code 83518 (Immunoassay for analyte other than antibody or
infectious agent antigen, qualitative or semiquantitative; single step
method [e.g., reagent strip]) should be used for a qualitative or
semiquantitative immunoassay of an analyte other than an antibody. This
includes quick screens, using low technology testing (e.g., reagent strips,
dip stick, etc.).

Confirmed drugs may be quantitated using the appropriate code in the
chemistry section (82000-84999) or therapeutic drug assay section
(80150-80299).

Therapeutic Drug Assays (80150-80299)

Use the specific procedure code listed in the CPT book for individual
quantitative assay. For non quantitative testing, use codes 80100-80103.

Urinalysis (81000-81099)

Code 81000 is described as a complete urinalysis, non-automated. Code 81001
is a complete urinalysis, automated. Neither is to be used in conjunction
with the following HCPCS procedure codes: 81002, 81003, 81005, and 81015.
Any stick, dip, or tablet tests performed on a single specimen are
considered to be part of the 81000 or 81001 and are not eligible for
separate reimbursement. In order to bill for an 81000 or an 81001, a
microscopy must be performed.
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Chemistry And Toxicology (82000-84999)

When billing for any specific chemistry test that is noted under the list
of automated, multichannel tests, do not use the individual HCPCS procedure
codes regardless of whether the tests are performed using manual methods or
automated, multichannel equipment. The practitioner should bill using the
appropriate profile code.

Hematology (85000 - 85999)

When billing codes for a complete blood count (CBC) or hemogram, identified
as HCPCS procedure codes 85021, 85022, 85023, 85024, 85025, 85027, or
85031, do not bill for any code that is a component of a CBC for the same
specimen. The following are the HCPCS procedure codes for components:
85007, 85008, 85013, 85014, 85018, 85041, 85048, 85585, 85590, and 85595.

Providers are reminded not to use multiple procedure codes when a single
procedure code accurately describes the service rendered.

Immunology (86000 - 86999)

When there is no specific code for an immunology procedure, the code for
the methodology is to be used. Certain codes can be used to describe many
different tests. When two or more different tests are described by the same
code and are performed on the same patient on the same day, bill on a
single line using multiple units of service.

Identify the procedures performed in Block 19 of the HCFA 1500, which is
used to explain unusual services or circumstances.

Microbiology (87001 - 87999)

The following policies apply:

· A definitive culture is one in which ALL probable pathogens are isolated
and identified. Commercial kits are not considered to be definitive culture
methods.

EXAMPLE: When billing code 87060 (Culture, bacterial, definitive; throat or
nose), the practitioner is expected to be able to isolate and identify
Haemophilus, gram negative rods, staphylococci, pneumococci, and other
probable naso-pharyngeal pathogens in addition to beta hemolytic
streptococci.

· A presumptive or screening culture is one in which a single pathogen is
isolated but may or may not be definitively identified.

EXAMPLE: When a throat culture is screened for the presence or absence of
group A beta streptococci using a low concentration bacitracin disc, bill
for one unit of 87081. Identification aids such as bacitracin and neomycin
discs are considered part of the screen and should not be billed in
addition to the 87081.

EXAMPLE: When a genital culture is screened for the presence or absence of
Neisseria gonorrhea (GC), bill for one unit of 87081.

· Commercial kits are self-contained microbiology systems that offer
screening information on one or more probable pathogens. HCPCS procedure
codes for commercial kits are found in the microbiology section of the CPT
book. Cultures performed using commercial kits are not considered
definitive. In block 19 of the HCFA 1500 which is used to explain unusual
services or circumstances, identify the commercial kit used.

EXAMPLE: When a culture of the urethra for Neisseria gonorrhea (GC) is
performed using the Isocult commercial kit for gonorrhea, bill for one unit
of HCPCS procedure code 87082. In block 19 of the HCFA 1500, note that
Isocult was the commercial kit used.

· Direct sensitivities are not reimbursable. A direct sensitivity is
inoculated directly from the specimen at the time of the initial culture.
DO NOT use HCPCS procedure codes 87181, 87184, 87186, or 87188 to describe
direct sensitivities. Sensitivities will only be reimbursed after a
pathogen has been isolated and set up for sensitivities.

· HCPCS procedure code 87088 is described as a culture, bacterial, urine;
identification, in addition to quantitative or commercial kit. It is not to
be used in conjunction with procedure code 87086 (Culture, bacterial,
urine; quantitative, colony count) or with procedure code 87087 (Culture,
bacterial, urine; commercial kit). They are considered to be part of
procedure code 87088 when performed on the same specimen.

—END OF MANUALS—

Comments or requests for copies of proposed changes or relevant materials
may be made in writing to: Medicaid Administrative Offices, Division of
Social Service, P.O. Box 906, New Castle, DE 19720, attention: Thelma G.
Mayer, or by calling (302) 577-4880, extension 131, or may be viewed at the
following locations: New Castle County: Medicaid Office, Lewis Bldg.,
Herman M. Holloway, Sr. Health & Social Services Campus, 1901 N. DuPont
Hwy., New Castle, DE, 19720; Kent County: Medicaid Unit, Division of Social
Services, Williams State
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Service Center, 805 River Rd., Dover, DE 19901; Sussex County: Medicaid
Unit, Division of Social Services, Georgetown State Service Center, 546 S.
Bedford St., Georgetown, DE, 19947. Comments, written suggestions,
compilations of data, testimony, briefs or other written materials
concerning the proposed change must be received by mail no later than March
1, 1998, at the Medicaid Administrative Office, Lewis Bldg., Herman M.
Holloway, Sr. Health & Social Services Campus, 1901 N. DuPont Hwy., New
Castle, DE 19720, attention Thelma Mayer. Materials filed thereafter will
not be considered except where good cause for lateness is demonstrated.
Copies of all written submissions filed with the Medicaid office will be
available for public inspection in the Medicaid Administrative Office at
the address given above. Please call (302) 577-4800, ext.131 for an
appointment if you wish to review the materials. Individuals with
disabilities who wish to participate in these proceedings, or review the
materials submitted, should contact the Division to discuss auxiliary aids
or services needed to facilitate such review or participation. Such contact
may be in person, in writing or by telephone by using the
Telecommunications Relay Service, or otherwise.

The Personal Responsibility and Work Opportunity Reconciliation Act of 1996
(PRWORA, P.L. 104-193) enacted on August 22, 1996, significantly changed
Medicaid eligibility for individuals who are not citizens of the United
States. The legislation revised the categories of noncitizens who may be
determined eligible for Medicaid. The legislation identifies noncitizens as
qualified aliens or nonqualified aliens. The term qualified refers to
groups of aliens whose members may establish Medicaid eligibility under
certain circumstances and subject to certain limitations. For specific
groups of aliens identified as nonqualified, eligibility is limited to the
treatment of an emergency medical condition as defined in this section.

In State Fiscal Year 1998, (SFY 98), the Delaware legislature appropriated
state only funds to restore coverage of full Medicaid benefits to legally
residing noncitizens who lost eligibility for full Medicaid benefits
because of PRWORA. Coverage for these aliens will be provided on a fee for
service basis and is subject to the availability of state funding. In the
event state funding is exhausted, the benefits will be reduced to coverage
of emergency services and labor and deliver only.

Aliens who may be found eligible for full Medicaid coverage using the state
funds include legally residing nonqualified aliens and qualified aliens
subject to the 5 year bar. Illegally residing aliens and ineligible aliens
are not eligible for full Medicaid coverage, but remain eligible for
emergency services and labor and delivery only.

All applicants, whether aliens or citizens, must meet the technical and
financial eligibility criteria of a specific eligibility group such as SSI
related group, AFDC related group, or poverty level related group. Not
every alien, qualified or nonqualified, will be eligible for Medicaid. For
example, enrollment in a managed care organization is a technical
eligibility requirement for adults in the expanded population under the
Diamond State Health Plan demonstration waiver. A nonqualified alien or a
qualified alien who is subject to the 5 year PRWORA bar cannot be found
eligible in the expanded population. This is because the state funded
benefits are provided on a fee for service basis. An individual cannot be
found eligible under the expanded population for emergency services only
because those benefits are provided on a fee for service basis. Adults in
the expanded population are required to enroll in managed care to receive
benefits.

I. United States Citizens

An individual qualifies as a U.S. citizen if the person was
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department of health &

social services

Division of Social Services

Statutory Authority:

PUBLIC NOTICE

Medicaid / Medical Assistance Program

In compliance with the State's Administrative Procedures Act (APA - Title
29, Chapter 101 of the Delaware Code) and with 42CFR §447.205, the Delaware
Department of Health and Social Services (DHSS) Division of Social
Services/Medical Assistance Program (DMAP) hereby publishes notice of
proposed policy amendments to the Medicaid eligibility policy manual
reflecting changes made to the program as a result of the Personal
Responsibility and Work Opportunity Reconciliation Act of 1996, P.L.
104-193 (PRWORA) and changes to coverage for aliens mandated by PRWORA and
new coverage for some aliens funded by the State. The proposed policy
changes are as follows:

240.10 CITIZENSHIP AND ALIENAGE

Overview
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born in the 50 states and District of Columbia, Puerto Rico, Guam, U.S.
Virgin Islands, or Northern Mariana Islands. Nationals from American Samoa
or Swain's Island are regarded as U.S. citizens for purposes of Medicaid
eligibility. Children of a U.S. citizen who are born outside the U.S., may
automatically be eligible for a Certificate of Citizenship. In order to
receive the certificate, an INS Form N-600 needs to be filed.

A. Medicaid Eligibility for U.S. citizens

Medicaid must be provided to eligible citizens or nationals of the United
States.

II. Noncitizens or Aliens

The word "alien" is a technical, legal term for a person who is not a U.S.
citizen. Common immigration terms are listed at the end of this section.
Medicaid eligibility for aliens is based on whether the alien is a
qualified or nonqualified alien. The previous category of lawful permanent
resident becomes a subcategory of the new term qualified alien. The
category known as permanently residing in the United States under color of
law (PRUCOL) no longer applies and is no longer an eligibility
classification. Individuals who were formerly PRUCOL are now considered
nonqualified aliens.

III. Qualified Aliens

A qualified alien is:

a) an alien who is lawfully admitted for permanent residence under the
Immigration and Nationality Act (INA). An American Indian born in Canada is
included in this designation provided he or she is of at least one-half
American Indian blood. This does not include a spouse or child of the
Indian or a non citizen whose membership in an Indian tribe or family is
created by adoption, unless the person is of at least 50% or more Indian
blood.

b) a refugee who is admitted to the United States under §207 of the INA

c) an alien who is granted asylum under §208 of the INA

d) an alien whose deportation is being withheld under §243(h) of the INA or
§241(b)(3) of the INA

e) an alien who is paroled into the United States under §212(d)(5) of the
INA for a period of at least 1 year

f) an alien granted conditional entry pursuant to §203(a)(7) of the INA as
in effect before April 1, 1980

g) honorably discharged veterans and aliens on active duty in the U.S.
armed forces and the spouse or unmarried dependent children of a veteran or
active duty serviceman. The discharge must not be due to alien status and
the active duty status must not be for training. For example, the 2 weeks
of active duty training usually required of members of the National Guard
does not meet the definition of active duty. Hmong and other Highland
Lao veterans who fought on behalf of the Armed Forces of the U.S. during
the Vietnam conflict and who have lawfully been admitted for permanent
residence are considered veterans.

h) an alien granted status as a Cuban and Haitian entrant (as defined in
Section 501(e) of the Refugee Education Assistance Act of 1980)

i) an alien admitted to the U.S. as an Amerasian immigrant pursuant to
Section 584 of the Foreign Operations, Export Financing, and Related
Programs Appropriations Act, 1988

j) aliens who have been subjected to battery or extreme cruelty and who
meet certain criteria, including an alien whose child has been battered or
an alien child whose parent has been battered

k) an American Indian born in Canada who is at least one-half American
Indian blood and to whom the provisions of §289 of the INA apply or who is
a member of an Indian tribe under section 4(e) of the Indian
Self-Determination and Education Assistance Act

A. Medicaid Eligibility for Qualified Aliens

Effective January 1, 1998, all qualified aliens, regardless of the date of
entry into the U.S., may be found eligible for full Medicaid benefits,
including long term care services.

The Delaware legislature appropriated state only funds to restore full
Medicaid benefits to legally residing noncitizens who lost eligibility for
full Medicaid because of PRWORA. Under PRWORA, certain qualified aliens
entering the U.S. on or after 8/22/96 were subject to a 5 year bar on
eligibility. Coverage for full Medicaid benefits for the qualified aliens
who are under the 5 year PRWORA bar, is subject to the availability of
state funds.

The PRWORA policy (as amended by the Balanced Budget Act) which follows
describes the eligibility for qualified aliens prior to the appropriation
of state funds. In

the event such state funding is exhausted, eligibility for qualified aliens
will be determined using the PRWORA policy described below.

Under PRWORA, there are both mandatory and optional coverage groups for
qualified aliens depending upon the alien's date of entry into the U.S.
Delaware has decided to cover both the mandatory and optional groups.

The date of entry is significant for the aliens listed as a), e), f), j).
These aliens who enter the U.S. on or after 8/22/96 are not eligible for
full Medicaid benefits for 5 years after date of entry. These aliens are
eligible only for emergency services and labor and delivery services during
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the first 5 years in the U.S.

The following qualified aliens may be found eligible for Medicaid
regardless of their date of entry into the U.S.:

· Refugees (§207 of INA)

· Asylees (§208 of INA)

· Aliens who have had deportation withheld under §243(h) or §241(b)(3) of
the INA

· Honorably discharged veterans and aliens on active duty in the U.S. armed
forces and the spouse or unmarried dependent children of a veteran or
active duty serviceman.

· Cuban and Haitian entrants

· Amerasians

· American Indian born in Canada or who is a member of an Indian tribe
under section 4(e) of the Indian Self-Determination and Education
Assistance Act

In addition, title IVE Foster Children and Adoption Assistance children may
be found eligible for Medicaid regardless of date of entry provided the
foster or adoptive parent of the child is also a qualified alien or a
citizen. The IVE agency is responsible for making that determination about
the parent. If a IVE payment is being made on behalf of the child, then the
child is deemed eligible for Medicaid.

For the following qualified aliens, eligibility under PRWORA is determined
based upon the date of entry into the U.S.:

· Lawful permanent residents

· Aliens granted parole (parolees)

· Aliens granted conditional entry (conditional entrants)

· battered immigrants

If these aliens (lawful permanent residents, parolees, conditional
entrants, battered immigrants) were living in the U.S. before August 22,
1996, they may be found eligible for Medicaid. If these aliens entered the
U.S. on or after August 22, 1996, they are not eligible for full Medicaid
benefits for 5 years from the date of entry into the U.S. They may be found
eligible for emergency services only during the first 5 years after
entering the U.S. Once these aliens have been in the U.S. for 5 years, they
may be found eligible for full Medicaid.

IV. Legally Residing Nonqualified Aliens

These are aliens who do not meet the above definition of qualified aliens.
Individuals formerly known as PRUCOL are now considered nonqualified
aliens. Nonqualified aliens have to provide a Social Security Number (SSN)
if
one is available, or apply for a SSN if the applicant does not have one.

Legally residing nonqualified aliens include the following:

· aliens granted permission to remain and work in the U.S.

· individuals who have been paroled into the U.S. for less than 1 year

· applicants for immigration status such as applicants for asylum,
adjustment to lawful permanent resident status, suspension of deportation

· aliens in Temporary Protected Status (TPS)

· aliens in temporary resident status

· Family unity beneficiaries

· aliens under deferred enforced departure

· aliens in deferred action status

· aliens who are the spouses or children of U.S. citizens with approved
visa petitions and pending adjustment of status application.

A. Medicaid Eligibility for Legally Residing Nonqualified Aliens

Effective January 1, 1998, legally residing nonqualified aliens, regardless
of the date of entry into the U.S., may be found eligible for full Medicaid
benefits, including long term care services.

The Delaware legislature appropriated state only funds to restore full
coverage of Medicaid benefits to legally residing noncitizens who lost
eligibility for full Medicaid benefits because of PRWORA. Coverage for full
Medicaid benefits for these legally residing nonqualified aliens is subject
to the availability of state funds.

The PRWORA policy (as amended by the Balanced Budget Act) which follows
describes the eligibility for legally residing nonqualified aliens prior to
the appropriation of state funds. In the event such state funding is
exhausted, eligibility for legally residing nonqualified aliens will be
determined using the PRWORA policy described below.

Under PRWORA, legally residing nonqualified aliens, who meet the technical
and financial requirements of a specific Medicaid eligibility group, are
only eligible for the treatment of an emergency medical condition, as
defined in this section, and labor and delivery services. Under PRWORA,
legally residing nonqualified aliens are not eligible for any long term
care Medicaid program.

V. Illegally Residing Nonqualified Aliens

The term nonqualified aliens also includes aliens who are
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illegally residing in the U.S. These aliens either were never legally
admitted to the United States for any period of time, or were admitted for
a limited period of time and did not leave the

United States when the period of time expired. Unlike other nonqualified
aliens, they are not issued SSNs. Aliens who are illegally residing in the
U.S. do not have to provide a SSN.

Legal nonimmigrants are not included in the group of nonqualified aliens.
Legal nonimmigrants are included with the group known as ineligible aliens.

A. Medicaid Eligibility for Illegally Residing Nonqualified Aliens

Illegally residing nonqualified aliens, who meet the technical and
financial requirements of a specific Medicaid eligibility group, are only
eligible for the treatment of an emergency medical condition, as defined in
this section, and labor and delivery services. Illegally residing
nonqualified aliens are not eligible for any long term care Medicaid
program.

VI. Ineligible Aliens

Some aliens may be lawfully admitted to the United States but only for a
temporary or specified period of time as legal nonimmigrants. They are
known as ineligible aliens. These aliens do not have to provide a Social
Security Number. The following categories of individuals are known as
ineligible aliens:

· Foreign government representative on official business and their families
and servants

· Visitors for business or pleasure, including exchange visitors

· Aliens in travel status while traveling directly through the U.S.

· Crewmen on shore leave

· Treaty traders and investors and their families

· Foreign students

· International organization representation and personnel and their
families and servants

· Temporary workers including agricultural contract workers

· Members of foreign press, radio, film, or other information media and
their families.

Ineligible aliens may present the following documentation:

· Form I-94 Arrival-Departure Record with codes other than those listed for
qualified aliens, such as a
nonimmigrant code

· Form I-185, Canadian Border Crossing Card

· Form I-186, Mexican Border Crossing Card

· Form I-95A, Crewman's Landing Permit.

A. Medicaid Eligibility for Ineligible Aliens

In some cases an alien in a currently valid nonimmigrant classification may
meet State residence rules. When this is the case, the alien may be found
eligible for Medicaid.

Ineligible aliens, who meet the technical and financial requirements of a
specific Medicaid eligibility group (including State residency), are only
eligible for the treatment of an emergency medical condition, as defined in
this section, and labor and delivery services. Ineligible aliens are not
eligible for any long term care Medicaid program.

VII. Treatment of an Emergency Medical Condition

To be eligible for coverage of labor and delivery and emergency services,
the alien must meet all eligibility requirements for a specific Medicaid
eligibility group such as in the SSI related groups, poverty level related
groups, or AFDC related groups. The alien does not have to meet the
requirement concerning declaration of satisfactory immigration status and
verification of that status.

Under PRWORA, nonqualified noncitizens (aliens) are eligible ONLY for
coverage of emergency services and labor and delivery services. As noted
previously, legally residing nonqualified aliens may be found eligible for
full Medicaid benefits effective January 1, 1998. Illegally residing aliens
and ineligible aliens are eligible ONLY for coverage of emergency services
and labor and delivery services. These services must be rendered in an
acute care hospital emergency room or in an acute care inpatient hospital.
In addition, emergency services must be rendered for diagnoses designated
by the Delaware Medical Assistance Program (DMAP) as an emergency. A
comprehensive list of the covered diagnoses is available in Appendix G of
the DMAP Provider General Policy Manual.

The DMAP defines an emergency as:

· a sudden serious medical situation that is life threatening; OR

· a severe acute illness or accidental injury that demands immediate
medical attention or surgical attention; AND

· without the treatment a person's life could be threatened or he or she
could suffer serious long lasting
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disability.

Medically necessary physician (surgeon, pathologist, anesthesiologist,
emergency room physician, internist, etc.) or midwife services rendered
during an emergency service that meets the above criteria are covered.
Ancillary services (lab, x-ray, pharmacy, etc.) rendered during an
emergency service that meets the above criteria are also covered. Emergency
ambulance services to transport these individuals to and from the services
defined above are also covered.

Services not covered for nonqualified noncitizens who are determned to be
eligible for emergency service and labor and delivery only include but are
not limited to:

· any service delivered in a setting other than an acute care hospital
emergency room or an acute care inpatient hospital.

· any service (such as pharmacy, transportation, office visit, lab or
x-ray, home health) that precedes or is subsequent to a covered emergency
service. Exception: ambulance transportation that is directly related to
the emergency is covered.

· organ transplants

· long term care or rehabilitation care

· routine prenatal and post partum care

VIII. Documentation and Verification of Citizenship or Alien Status

A. Declaration of Satisfactory Immigration Status

As a condition of eligibility, applicants must sign a written declaration
under penalty of perjury stating if he or she is a citizen, national of the
United States or an alien in satisfactory immigration status. (qualified
alien or alien in lawful status) This declaration is obtained on the
Affidavit of Citizenship or Lawful Immigration Status form as part of the
application for Medicaid. In the case of a child or incompetent applicant,
an adult must sign on the applicant's behalf. The applicant must also sign
the Consent of Disclosure (Form SAVE 2), which allows the Immigration and
Naturalization Service (INS) to provide verification of the individual's
alien status.

If the applicant is not a citizen, national of the United States, qualified
aliens or an alien in lawful status, the declaration of citizenship or
satisfactory immigration status and verification of such status is not
required. If the applicant will not sign the declaration, he or she may be
found eligible for coverage for labor and delivery and emergency services
only.

B. Documentation of Citizenship or Alien Status

Applicants must provide documentation of citizenship, qualified alien
status, or lawful alien status. All noncitizens who declare they are
qualified aliens or in lawful alien status, must provide INS documents to
establish immigration status. Examples of acceptable documentation for U.S.
citizens, qualified aliens, and lawful alien status are given in this
section.

If the applicant will not provide evidence of citizenship or alien status
and does not allege qualified or lawful alien status, the application is
not denied, but an eligibility determination is completed for coverage of
labor and delivery and emergency services only.

As required by §1137(d)(4) of the Social Security Act, Medicaid will be
provided to individuals who meet all other nonimmigration Medicaid
eligibility requirements, pending verification of immigration status. We
will provide Medicaid to an otherwise eligible individual who has presented
INS documents showing qualified or lawful alien status, pending
verification of the document.

For noncitizen applicants who declare they are qualified or lawful aliens
or for individuals who declare citizenship but have no documentation, we
must allow the individual a reasonable opportunity to produce evidence of
immigration or citizenship status. We will give the individual 30 days from
the date of the receipt of application to produce an INS document or
documentation of citizenship. If the individual meets all other eligibility
requirements except for this documentation, we will provide Medicaid during
this 30 day period.

If the applicant provides an expired INS document or has no documentation
regarding his or her immigration status, refer the individual to the local
INS district office to obtain evidence of status. As noted previously,
Medicaid coverage is provided for a 30 day period pending verification of
alien status. If the applicant can provide an alien registration number,
follow the secondary verification procedures outlined below under Section
"C. Verification of Immigration Alien Status".

C. Verification of Immigration Alien Status

States are required to verify alien status with the INS. Delaware Medicaid
will verify alien status through the Systematic Alien Verification for
Entitlements (SAVE) mechanism in operation in the Division of Social
Services. Verification must be completed at initial application and at
redetermination.
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Staff will institute primary verification to INS through the DSS form
"Record of Contact with ASVI Data Base" (SAVE-1). ASVI is the acronym for
Alien Status Verification Index. Clear copies of alien immigration
documentation must be attached to the SAVE-1 form. If the response verifies
alien status, process the case using the INS information. If the response
states institute secondary verification, begin that process by completing
all parts of Section A on the revised

G-845S. A separate G-845S must be completed for each applicant and must
include copies of the documents for that person only. If a family has
applied for benefits, each member will require a separate G-845S. The local
INS office will complete the G-845S and return it to the State Office SAVE
point-of-contact person, who will forward the response to the eligibility
worker.

INS verification requests and responses (both primary and secondary) must
be dated and filed in the case record.

An alien registration number is required for both primary and secondary
verifications. If the applicant provides an alien registration number but
does not have the INS document, complete Form G-845S including the alien
registration number. If an applicant provides a receipt indicating that he
or she has applied to INS for a replacement document, use a Form G-845S
attaching a copy of the receipt.

D. Documentation of U.S. Citizenship

The following are examples of acceptable documentation of U.S. citizenship
for Medicaid applicants:

· Birth certificate

· Religious record of birth recorded in the U.S. or its territories within
3 months of birth, which indicates a U.S. place of birth. The document must
show either the date of birth or individual's age at the time the record
was made.

· Hospital record of birth in one of the 50 States, the District of
Columbia, Puerto Rico (on or after January 13, 1941), Guam (on or after
April 10, 1899), the U.S. Virgin Islands (on or after January 17, 1917),
American Somoa, Swain's Island or the Northern Mariana Islands (unless the
person was born to foreign diplomats residing in such a jurisdiction)

· U.S. passport (not time limited passports, which are issued for periods
of less than 5 years)

· Report of Birth Abroad of a Citizen of the U.S. (INS Form FS-240)

· TPQY from Social Security Administration showing citizen code "A" or "C"

· Certification of Birth (INS Form FS-545)

· U. S. Citizen I.D. Card (INS Form I-197)

· Naturalization Certificate (INS Form N-550 or N-570)

· Certificate of Citizenship (INS Form N-560 or N-561)

· Northern Mariana Identification Card (issued by the INS to a collectively
naturalized citizen of the U.S. who was born in the Northern Mariana
Islands before November 3, 1986)

· American Indian Card with a classification code "KIC" and a statement on
the back (issued by the INS to identify U.S. citizen members of the Texas
Band of Kickapoos living near the U.S./Mexican border)

· Other alternative documentation that is determined to be acceptable by
the State

E. Documentation of Qualified Aliens

Acceptable documentation of qualified alien status is listed below. The
card should show the date of admission or date of entry into the United
States.

1. Lawful Permanent Residents

INS Form I-551, or for recent arrivals, a temporary I-551 stamp in a
foreign passport or on Form I-94.

NOTE: INS has replaced Forms I-151, AR-3 and AR-3a. If a lawful permanent
resident presents one of these old INS forms as evidence of status, contact
INS using a G-845S and attach the old card.

An American Indian Born in Canada is considered to be lawfully admitted for
permanent residence if he or she is of at least one-half American Indian
blood. Documentation to be used includes birth or baptismal certificate
issued on a reservation, tribal records, letter from the Canadian
Department of Indian Affairs or school records.

2. Refugees

INS Form I-94 annotated with stamp showing entry as refugee under §207 of
the Immigration and Naturalization Act (INA) and date of entry to the
United States; INS Form I-688B annotated 274a.12(a)(3); I-766 annotated A3;
or
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Form I-571. Refugees usually adjust to Lawful Permanent Resident status
after 12 months in the U.S. However, for purposes of eligibility, the
individual is still considered a refugee and it is important to check the
coding on Form I-551 for codes RE-6, RE-7, RE-8, or RE-9.

3. Asylees

INS Form I-94 annotated with stamp showing grant of asylum under §208 of
the INA; a grant letter from the Asylum Office of the INS; Form I-688B
annotated 274a.12(a)(5); I-766 annotated A5; or an order of an Immigration
Judge granting asylum. If the applicant provides a court order contact INS
using a G-845S and attach a copy of the court order.

4. Alien who has had deportation withheld under §243(h) of the INA

Order of an Immigration Judge showing deportation withheld under §243(h) or
§241(b)(3) and date of the grant; Form I-688B annotated 274a.12(a)(10); or
I-766 annotated A10. If applicant provides a court order contact INS using
G-845S and attach copy of court order.

5. Parolees

INS Form I-94 annotated with stamp showing grant of parole under §212(d)(5)
of the INA and a date showing granting of parole for at least 1 year. INS
Form I-688B annotated 274a.12(a)(4) or 274a.12(c)(11) or I-766 annotated A4
or C11 indicates status as a parolee but does not reflect the length of the
parole period.

6. Conditional Entrant

INS Form I-94 annotated with stamp showing admission under §203(a)(7) of
the INA, refugee-conditional entry; Forms I-688B annotated 274a.12(a)(3);
or I-766 annotated A-3.

7. Evidence of Honorable Discharge or Active Duty Status

· Discharge - a copy of the veteran's discharge papers issued by the branch
of service in which the applicant was a member. (Department of Defense Form
214)

· Active Duty Military - a copy of the applicant's current orders showing
the individual is on full-time duty in the U.S. Army, Navy, Air Force,
Marine Corps, or Coast Guard or an active military identification card, DD
Form 2. Full time National Guard duty is excluded.

· A self declaration under penalty may be accepted pending receipt of
acceptable documentation. The individual is given 30 days to produce
evidence; and, if the individual is otherwise eligible, Medicaid is
provided during this 30 day period.

8. Cuban and Haitian entrants

I-551 annotated CH6, CNP, CU6, CU7; I-688B annotated 274a.12(a)(4); I-94
annotated 212(d)(5)

9. Amerasian

I-94 annotated AM1, AM2, AM3; I-551 annotated AM1, AM2, AM3.

10. Battered Immigrant

In order to be a qualified alien based on battery or extreme cruelty, the
alien must meet the requirements of 10.1. through 10.4 below:

10.1 the alien must not now be residing in the same household as the
individual responsible for the battery or extreme cruelty

10.2 the alien or the alien's child has been battered or subjected to
extreme cruelty in the U.S. by a spouse or parent of the alien, or by a
member of the spouse's or parent's family residing in the same household as
the alien, but only if the spouse or parent consents to or acquiesces in
such battery or cruelty and, in the case of a battered child, the alien did
not actively participate in the battery or cruelty

10.3. there is a substantial connection between the battery or extreme
cruelty and the need for the public benefit sought. There is a substantial
connection under any one or more of the following circumstances:

a) Where the benefits are needed to enable the alien and/or the alien's
child to become self-sufficient following separation from the abuser;

b) Where the benefits are needed to enable the alien and/or the alien's
child to escape the abuser and/or the community in which the abuser lives,
or to ensure the safety of the alien and/or his or her child from the
abuser;

c) Where the benefits are needed due to a loss of financial support
resulting from the alien's and/or his or her child's separation from the
abuser;

d) Where the benefits are needed because the battery or cruelty, separation
from the abuser, or work absence or lower job performance resulting from
the battery or extreme cruelty or from legal proceedings relating to the
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battery or cruelty (such as child support or child custody disputes) cause
the alien and/or the alien's child to lose his or her job or require the
alien and/or the alien's child to leave his or her job for safety reasons;

e) Where the benefits are needed because the alien or his or her child
requires medical attention or mental health counseling, or has become
disabled, as a result of the battery or cruelty;

f) Where the benefits are needed because the loss of a dwelling or source
of income or fear of the abuser following separation from the abuser
jeopardizes the alien's ability to care for his or her children (e.g.
inability to house, feed, or clothe children or to put children into day
care for fear of being found by the batterer);

g) Where the benefits are needed to alleviate nutritional risk or need
resulting from the abuse or following separation from the abuser;

h) Where the benefits are needed to provide medical care during an unwanted
pregnancy resulting from the abuser's sexual assault or abuse of or
relationship with the alien or his or her child; and/or to care for any
resulting children; or

where medical coverage and/or health care services are needed to replace
medical coverage or health care services the applicant or child had when
living with the abuser.

10.4 the alien or alien's child must have a petition approved by or pending
with INS under one of several subsections of the INA that sets forth a
prima facie case for the status.

11. American Indian born in Canada under section 289 of the INA or member
of Indian tribe under section 4(e) of the Indian Self-Determination and
Education Assistance Act

INS Form I-551 with the code S13; unexpired temporary I-551 stamp with code
S13 in a Canadian passport or on Form I-94; satisfactory evidence of birth
in Canada and a document that indicates the percentage of American Indian
blood in the form of a birth certificate issued by the Canadian reservation
or a record issued by the tribe; a membership card or other tribal document
showing membership in the tribe that is on the list of recognized Indian
tribes published annually by the Bureau of Indian Affairs in the Federal
Register.

IX. Common Immigration Terms

1. Immigrant

A general term for new arrivals, this includes legal immigrants, refugees,
asylees, parolees, and others. Legal immigrants are granted admission to
the U.S. on the basis
of family relation or job skill.

2. Nonimmigrant

An alien allowed to enter the U.S. for a specific purpose and for a limited
period of time such as a student, visitor, or tourist.

3. Refugee

A person who flees his or her country due to persecution or a well-founded
fear of persecution because of race, religion, nationality, political
opinion, or membership in a social group.

4. Asylee

Similar to a refugee, this is a person who seeks asylum and is already
present in the U.S. when he or she requests permission to stay.

5. Parolee

The Justice Department has discretionary authority to permit certain
persons or groups to enter the U.S. in an emergency or because it serves an
overriding public interest. Parole may be granted for humanitarian, legal,
or medical reasons. Some persons who fear persecution are "paroled" into
the U.S. as refugees when the number of refugees allowed to enter that year
has been exceeded.

6. Alien not lawfully present in the U.S.

Also known as an undocumented immigrant, this is someone who enters or
lives in the U.S. without official authorization, either by entering
without inspection by the INS, overstaying their visa, or violating the
terms of their visa.

7. Cuban/Haitian entrants

This category was created for the Cuban and Haitian arrivals in 1980, who
were allowed to obtain work permits.

8. PRUCOL

Permanently residing under color of law is not a method for entering the
country, but indicates that an individual is legally present under
statutory authority and may remain under administrative discretion. PRUCOL
is no longer an eligibility classification under the Personal
Responsibility and Work Opportunity Reconciliation Act of 1996. (PRWORA)

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9. Deeming

Some legal immigrants come to the U.S. with the aid of citizens who serve
as their sponsors. That sponsor signs an affidavit of support agreeing to
help support and sustain the immigrant. Deeming means that the income and
resources of the sponsor and his or her spouse are deemed or considered
available when determining the sponsored alien's eligibility.

10. Affidavit of Support

An affidavit of support is the contract that an immigrant's sponsor signs,
agreeing to financially assist the immigrant to prevent him or her from
becoming a public charge. The Personal Responsibility and Work Opportunity
Reconciliation Act of 1996 make affidavits of support legally binding
documents and are enforceable until the immigrant naturalizes.

11. Public Charge

Immigrants who become dependent upon public assistance, fail to find
employment, and are unlikely to be self-supporting in the future may be
deported on the grounds that they have become a "public charge."

12. Naturalization

Naturalization is the process by which a foreign-born individual becomes a
citizen of the U.S. Naturalization requires that the person be over 18
years old, lawfully admitted to the U.S., reside in the country
continuously for five years, and have a basic knowledge of English,
American government, and U.S. history. There is an exemption from the
English and civics requirements for certain disabled immigrants.

301.10 Aid to Families with Dependent Children (AFDC)

A BETTER CHANCE

Any family who is determined eligible, by the Public Assistance Units, for
Aid to Families with Dependent Children (AFDC) or Aid to the Unemployed
(AU) is also eligible for Medicaid coverage.

The Personal Responsibility and Work Opportunity Reconciliation Act of
1996, P.L. 104-193, amended title IV-A of the Social Security Act to repeal
the Aid to Families with Dependent Children (AFDC) program. The AFDC
program provided an entitlement to cash assistance for eligible families
with dependent children. The Personal
Responsibility and Work Opportunity Reconciliation Act (PRWORA) replaces
AFDC with a program of block grants to States for Temporary Assistance for
Needy Families (TANF). Under TANF, States have broad flexibility to provide
assistance to needy families. Delaware implemented its TANF program, A
Better Chance, on March 10, 1997.

Before the passage of PRWORA, anyone receiving cash assistance under AFDC
was automatically entitled to Medicaid. Under the new law, families
receiving assistance under the block grant (TANF) are not automatically
entitled to Medicaid. A new Medicaid eligibility group for low income
families with children is established by Section 1931 of the Social
Security Act as added by section 114 of PRWORA. These families will receive
Medicaid if they meet the AFDC eligibility criteria in effect as of
7/16/96. The eligibility criteria for this new group is described in
Section 301.15.

Section 1931 also gives States more flexibility in determining Medicaid
eligibility. Delaware has used the authority in Section 1931 to keep the
rules for A Better Chance and for Medicaid consistent and use a single
application form to determine eligibility. This means that any family
eligible for and receiving cash assistance under A Better Chance is also
eligible for Medicaid under Section 1931 without having to complete a
separate Medicaid eligibility determination.

The beginning date for Medicaid eligibility is generally the same as for
the AFDC ABC case with the following exceptions:

1. In cases where the cash assistance payment is prorated from the date of
eligibility, the Medicaid effective date will be the first of that prorated
month. The Medicaid state plan provides for full month eligibility.

2. Effective January 1, 1991, any infant born to a mother receiving
Medicaid is also eligible for Medicaid effective the date of birth. The
baby remains continuously eligible for one year provided the infant remains
in the mother's household and the woman remains eligible or would be
eligible if she were pregnant.

3. In cases where the family has unpaid medical bills in any of the three
months prior to their month of application for cash assistance and would
have been eligible if they had applied in that month, Medicaid may be
provided for that month. Effective January 1, 1996, retroactive coverage is
not available if, in the month of application, the family is eligible for
enrollment into managed care. (see Section 306.40).
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Ineligibility for cash assistance under AFDC ABC does not mean automatic
ineligibility for Medicaid under Section 1931. Workers must determine if
AFDC ABC applicants or recipients would be eligible for Section 1931
Medicaid or any other type of Medicaid coverage before taking an action to
close or deny the Medicaid case.

Transitional Medicaid

If a family becomes ineligible for Medicaid under this eligibility group
because of either employment reasons or child support payments, determine
if the family is eligible for extended Medicaid coverage under Section
301.55 or 301.60.

301.15 LOW INCOME FAMILIES WITH CHILDREN

UNDER SECTION 1931

The Personal Responsibility and Work Opportunity Reconciliation Act of
1996, P.L. 104-193, added Section 1931 of the Social Security Act. Section
1931 establishes a new Medicaid eligibility group for low income families
with children. Coverage for this mandatory categorically needy group of
families with children is effective March 10, 1997, the date that
Delaware's TANF plan was approved.

Section 1931 defines the basic criteria for determining Medicaid
eligibility based upon AFDC eligibility criteria. The criteria includes
income and resource standards and methodologies as in effect on July 16,
1996, and deprivation and specified relative rules that were in effect on
that date. Section 1931 gives states flexibility to change these criteria.
Delaware has amended its Medicaid state plan to provide that the rules used
to determine eligibility under this group are the same as the rules used to
determine eligibility under ABC.

Families who are eligible for Medicaid under Section 1931 may be receiving
ABC cash assistance or may be Medicaid only families.

Technical Eligibility

Applicants must meet general technical eligibility criteria such as state
residency, citizenship or qualified alien status, Social Security number,
assignment of rights, etc., as described in Section 200.

In addition to the general technical eligibility requirements, the family
composition rules of the ABC cash assistance program must be met. The
family must include a child who is living with a parent or specified
relative. A child is an individual under the age of 18 or under age 19 and
who is still a full-time student in high school, GED, or equivalent program
and will graduate prior to his or her 19th birthday.

To be eligible for Medicaid under Section 1931, a child must be living in
the home of a relative by blood, marriage, or adoption who is within the
fifth degree of kinship to the child. The degree of relationship is as
follows:

· parent (1st degree)

· grandparent (2nd degree)

· sibling (2nd degree)

· great-grandparent (3rd degree)

· uncle or aunt (3rd degree)

· nephew or niece (3rd degree)

· great-great-grandparent (4th degree)

· great-uncle or aunt (4th degree)

· first cousin (4th degree)

· great-great-great-grandparent (5th degree)

· great-great-uncle or aunt (5th degree)

· first cousin once removed (5th degree)

Any other persons named in the above groups whose relationship is one of
the child's parents is established by legal adoption; the spouse of any
person named in the above groups even though the marriage terminated by
death or divorce.

The child must be living in the home of a parent or specified relative. The
home is defined as the family setting where the child and the caretaker
relative reside. The home exists as long as the relative is the responsible
caretaker even if the child or the relative is temporarily absent. The
rules of A Better Chance are used to determine if the child is living in
the home of a parent or specified relative.

NOTE: Deprivation is not an eligibility requirement for this group. If the
child is deprived of parental support, a referral to the Division of Child
Support Enforcement must be made.

Financial Eligibility

Follow ABC income and resource standards and methodologies (disregards,
exclusions, allocations).

Extended Medicaid

If a family becomes ineligible for Medicaid under this eligibility group
because of either employment reasons or child support payments, determine
if the family is eligible for extended Medicaid under Section 301.55 or
301.60.
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301.30 Families with Less than a $10.00 Need

Federal Regulation 42CFR 435.115(b)

Effective October 1, 1981, the Federal Government has declared that "no
payment of aid shall be made ... for any month if the amount of such
payment ... would be less than $10.00, but an individual ... to whom a
payment of aid ... is denied solely by reason of this ... is deemed to be a
recipient of aid..."

Therefore, anyone who would otherwise be eligible for an AFDC grant, or any
person under age 18 who would otherwise be eligible for a GA grant, but who
does not receive a grant because their need for assistance is less than
$10.00, is eligible for Medicaid.

The Personal Responsibility and Work Opportunity Reconciliation Act of
1996, P.L. 104-193, amended title IV-A of the Social Security Act to repeal
the Aid to Families with Dependent Children (AFDC) program. The AFDC
program provided an entitlement to cash assistance for eligible families
with dependent children. The Personal Responsibility and Work Opportunity
Reconciliation Act (PRWORA) replaces AFDC with a program of block grants to
States for Temporary Assistance for Needy Families (TANF). Under TANF,
States have broad flexibility to provide assistance to needy families.
Delaware implemented its TANF program, A Better Chance, on March 10, 1997.

Before the passage of PRWORA, anyone receiving cash assistance under AFDC
was automatically entitled to Medicaid. Under the new law, persons
receiving assistance under the block grant (TANF) are not automatically
entitled to Medicaid. A new Medicaid eligibility group for low income
families with children is established by Section 1931 of the Social
Security Act as added by section 114 of PRWORA. These families will receive
Medicaid if they meet the AFDC eligibility criteria in effect as of
7/16/96. The eligibility criteria for this new group is described in
Section 301.15.

Section 1931 also gives States more flexibility in determining Medicaid
eligibility. Delaware has used the authority in Section 1931 to keep the
rules for A Better Chance and for Medicaid consistent and use a single
application form to determine eligibility. This means that any family
eligible for and receiving cash assistance under A Better Chance is also
eligible for Medicaid without having to complete a separate Medicaid
eligibility determination.

Anyone who is otherwise eligible for ABC cash assistance
but does not receive cash because their need for assistance is less than
$10.00 is still eligible for Medicaid under Section 1931.

301.40 Deeming Cases

Federal Regulation 42 CFR 435.113, 435.122, 435.602

Any individual who is denied or loses AFDC benefits solely based on the
budgeting of stepparent, grandparent, sibling, or alien sponsor income or
resources may be eligible for Medicaid. An individual who is denied SSI
benefits soley based on the budgeting of alien sponsor income or resources
may be eligible for Medicaid.

Application Process

For AFDC deeming cases, the DSS application is used for the eligibility
determination. A Medicaid application must be completed for SSI sponsor
cases.

AFDC Deeming Cases

Following all AFDC rules and procedures, except for the deeming of income
or resources from grandparents, stepparents, siblings, or alien sponsors,
to determine Medicaid eligibility.

The Personal Responsibility and Work Opportunity Reconciliation Act of
1996, P.L. 104-193, amended title IV-A of the Social Security Act to repeal
the Aid to Families with Dependent Children (AFDC) program. The AFDC
program provided an entitlement to cash assistance for eligible families
with dependent children. The Personal Responsibility and Work Opportunity
Reconciliation Act (PRWORA) replaces AFDC with a program of block grants to
States for Temporary Assistance for Needy Families (TANF). Under TANF,
States have broad flexibility to provide assistance to needy families.
Delaware implemented its TANF program, A Better Chance, on March 10, 1997.

Before the passage of PRWORA, anyone receiving cash assistance under AFDC
was automatically entitled to Medicaid. Under the new law, families
receiving assistance under the block grant (TANF) are not automatically
entitled to Medicaid. A new Medicaid eligibility group for low income
families with children is established by Section 1931 of the Social
Security Act as added by section 114 of PRWORA. These families will receive
Medicaid if they meet the AFDC eligibility criteria in effect as of
7/16/96. The eligibility criteria for this new group is described in
Section 301.15.
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Section 1931 also gives States more flexibility in determining Medicaid
eligibility. Delaware has used the authority in Section 1931 to keep the
rules for A Better Chance and for Medicaid consistent and use a single
application form to determine eligibility. This means that any family
eligible for and receiving cash assistance under A Better Chance is also
eligible for Medicaid under Section 1931 without having to complete a
separate Medicaid eligibility determination.

Any individual who is denied or loses Medicaid under Section 1931 based on
the budgeting of stepparent, grandparent, or sibling income or resources
may be eligible for Medicaid.

Follow all rules for Medicaid under Section 1931 (same as ABC rules) except
for the deeming of income or resources from grandparents, stepparents, or
siblings.

Alien Sponsor cases

Many aliens with little or no income who want to become lawful permanent
residents have "sponsors" who pledge to support them. A sponsor is someone
who completes an affidavit of support with the Immigration and
Naturalization Service (INS) to help the alien friend or relative obtain
lawful permanent resident status. The sponsor's income and resources are
"deemed" or considered available when determining if the alien is eligible
for certain assistance programs.

An alien who files an application and is determined ineligible for cash
assistance under AFDC or SSI due to sponsor deeming, may be found eligible
for Medicaid. The individual must meet all technical and financial
requirements of either the AFDC or SSI program without the application of
sponsor deeming. The alien must be determined ineligible for AFDC or SSI
solely due to sponsor deeming.

A. AFDC alien sponsor

For AFDC alien sponsor deeming cases, follow all the AFDC rules published
in the Division of Social Services Policy Manual.

B. SSI alien sponsor

For SSI alien sponsor deeming cases, follow the rules of the SSI program.
The alien must be aged (65 or older), blind, or disabled. If the alien is
not aged, a Comprehensive Medical Report must be sent to the Medical Review
Team for the disability determination. A
social summary is not required. The eligibility worker will send the
medical report with a cover memo stating that the individual is claiming to
be disabled under the SSI definition of disability.

Use the income and resource rules, including income disregards, described
in the QMB section of this manual. (Section 307) Use the income standards
of the SSI program. Effective 1/1/97, the SSI income limit is $484.00 for
an individual and $726.00 for a couple. The resource limits are $2,000 for
an individual and $3000 for a couple.

The Personal Responsibility and Work Opportunity Reconciliation Act of 1996
requires Medicaid deeming for family sponsored immigrants who enter the
U.S. on or after August 22, 1996. The deeming rules apply only to sponsors
and immigrants who have signed the legally binding affidavits of support
that are promulgated by the Attorney General. Sponsor deeming is required
until the naturalization of the immigrant or until the sponsored immigrant
can be credited with 40 qualifying quarters of work. Since family sponsored
immigrants are subject to the 5 year bar on receiving benefits, there will
be no new sponsor deeming for approximately 5 years.

For SSI-related Medicaid eligibility groups, use the rules of the SSI
program. For AFDC-related Medicaid eligibility groups, use the rules of the
ABC program.

301.55 Transitional Medicaid Coverage

The Family Support Act of 1988, PL 100-485, mandated that effective April
1, 1990, states provide health care coverage known as Transitional Medical
Assistance for up to twelve months for families who become ineligible for
AFDC due to increased earnings, increased hours of employment, or loss of
earned income disregards. It replaces the previous four and nine month
extensions. Transitional Medicaid begins with the month of ineligibility
for AFDC. The month of ineligibility is defined as the month following the
last month AFDC was correctly received under the State's AFDC plan.
Transitional Medicaid is divided into two discrete periods that have
different eligibility requirements.

The Personal Responsibility and Work Opportunity Reconciliation Act of 1996
(PRWORA), P.L. 104-193, repealed the AFDC program and replaced it with a
program of block grants to states for Temporary Assistance for Needy
Families (TANF). Delaware implemented its TANF program, A Better Chance
(ABC), on March 10, 1997.

Prior to PRWORA, a family's eligibility for Transitional Medicaid was
linked to receipt of AFDC. Under
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PRWORA, a family's eligibility for transitional Medicaid is linked to
receipt of Medicaid under Section 301.15 "Low Income Families with Children
under Section 1931".

The eligibility group described in Section 301.15, "Low Income Families
with Children under Section 1931", will be referred to as "receiving
Medicaid under Section 1931" throughout this section. Any family eligible
for and receiving ABC benefits is also eligible for Medicaid under Section
1931 and may be found eligible for Transitional Medicaid. This means
references to "Medicaid under Section 1931" also refers to families
receiving ABC.

Delaware's welfare reform waiver, "A Better Chance" (ABC) includes a
modification to the length of the Transitional Medicaid period. The ABC
waiver extends Transitional Medicaid benefits for up to 24 months.

Families must meet the initial eligibility requirements described in this
section to receive the first 12 months of coverage. Families can be
eligible when their income exceeds either 185% of the standard of need or
the standard of need. The standard of need used is the same as the ABC
standard of need.

To continue to receive Medicaid for the second 12 months, the family's
gross earned income less child care costs must be at or below 185% FPL.
Family income will be budgeted prospectively.

Initial Eligibility for First Six Months

NOTE: All references to "Medicaid under Section 1931" includes families
determined eligible under Section 301.15 "Low Income Families with Children
under Section 1931" and families who receive ABC benefits. ABC families are
also eligible for Medicaid under Section 1931.

At the time a family becomes ineligible for AFDC Medicaid under Section
1931 determine whether the family meets the following three requirements.

1. The family must have received AFDC Medicaid under Section 1931 in three
of the six months immediately preceding the month the family became
ineligible for AFDC Medicaid under Section 1931 .

A family is considered to have received AFDC Medicaid under Section 1931 in
any month payments were correctly paid Medicaid assistance was correctly
provided. This does not include payments made Medicaid assistance provided
in error; payments made Medicaid assistance provided pending a hearing if
the family loses the hearing and the payments Medicaid assistance provided
is
recoverable as an overpayment; or payments made Medicaid assistance
provided for a month of ineligibility because of administrative notice
requirements. Recipients are obligated to report changes promptly. When a
change is reported, the worker must review eligibility. If the change will
result in ineligibility, the worker must take action to close the case.
This can affect the month of ineligibility.

1. The family must have received AFDC Medicaid under Section 1931 in
Delaware for three of the six months. Families who move into Delaware and
who have not received three months of AFDC Medicaid under Section 1931 here
are not eligible for transitional Medicaid. Transitional Medicaid benefits
are not transferable from one state to another. If a family is entitled to
and receives six months of transitional Medicaid benefits in another state
and then moves into Delaware, they are not eligible for transitional
Medicaid here.

2. The family must become ineligible for AFDC Medicaid under Section 1931
because of an increase in the hours of or increased income from the
employment of the caretaker relative or because a member of the family
loses the $30 and 1/3 earned income disregard or the $30 disregard.

This happens when:

· an increase in earned income (or countable earned income because of loss
of disregard) makes the family ineligible or

· an increase in other income when combined with an increase in earned
income (or countable earned income because of loss of disregard) makes the
family ineligible.

It is assumed in a two-parent family, both parents are "caretakers" and
therefore the principal wage earner would be a caretaker relative.

The following examples illustrate this requirement for a family of 4. The
standard of need is $1004.

Example 1

A family has recurring monthly unearned income of $500. The mother becomes
employed on June 6 and has countable earned income of $600 in June. The
family is no longer eligible for

AFDC Medicaid under Section 1931 in June due to excess income that is both
earned and unearned. Without the increase in earned income, the family
would have remained
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eligible for AFDC Medicaid under Section 1931 . The family is eligible for
transitional Medicaid.

Example 2

The mother becomes employed on June 6 and has countable earned income of
$400. At the same time, she reports that beginning in June the family will
receive monthly unearned income of $1200. The family is no longer eligible
for AFDC Medicaid under Section 1931 in June due to excess income that is
both earned and unearned.

Since the $1200 increase in unearned income alone was sufficient to make
the family ineligible for AFDC Medicaid under Section 1931, but the $400
earned income was not sufficient on its own to make the family ineligible,
the family did not lose AFDC Medicaid because of the increase in earned
income. The family is not eligible for transitional Medicaid.

Example 3

The family has no income. The mother becomes employed on June 6 and reports
countable earned income of $900 in June. In July, one child leaves the
household. As a result, the income limit for the family in July is reduced
to $833. The family is no longer eligible for AFDC Medicaid under Section
1931 in July due to excess income, all of which is earned. However, the
family is not eligible for transitional Medicaid because the earnings did
not increase in July, the month of ineligibility for AFDC Medicaid under
Section 1931.

Example 4

The mother is employed and has monthly countable earned income of $900. She
reports that she no longer has to pay for day care in June because free
care is available. Without child care expenses, her countable earned income
increases to $1200 in June. The family is no longer eligible for AFDC
Medicaid under Section 1931 in June because of excess income. The earnings
did not increase in June. Her countable income increased because of the
loss of a child care deduction. The family is not eligible for transitional
Medicaid.

3. The family must continue to have a child living in the home.

The family must continue to have a child living in the home that meets the
age requirement for AFDC Medicaid under Section 1931 ; that is, an
individual under age 18, or under age 19, and and who is still a full-time
student in
high school, GED, or equivalent program and will graduate prior to his or
her 19th birthday. The earned income of a child that meets the age
requirement is excluded. The child does not have to meet the former AFDC
definition of dependent child. For AFDC purposes, a child must be both
needy and deprived of parental care and support because of the absence,
disability, unemployment, etc., of the parent. This means that for
transitional Medicaid there is no deprivation requirement.

When the only child in the family no longer meets the age requirement, the
family is no longer eligible for transitional Medicaid because there is no
longer a child in the family. When one child turns age 18 or 19, but there
is another child in the family, the child who turns age 18 or 19 is no
longer considered a member of the transitional family unit. The rest of the
family remains eligible.

Transitional Family Unit

Transitional Medicaid provides eligibility for families rather than
individual eligibility. Transitional Medicaid coverage is provided to all
individuals who were included in the AFDC family unit at the time the
family lost AFDC became ineligible for Medicaid under Section 1931. In
addition, family members who enter the household or family members who were
absent but return may be found eligible.

An individual who enters the family unit (including a child born to the
family during the transitional period) may be eligible for transitional
Medicaid if that individual would have been included in the caretaker
relative's assistance unit if the family were now applying for AFDC
Medicaid under Section 1931. The rules for the composition of the
assistance unit for Medicaid under Section 1931 are the same as the rules
for the composition of the assistance unit for ABC. These rules are found
in ABC policy at Section 3015 of the Division of Social Services Manual.
The individual who enters the family must be one who could be found
eligible for AFDC Medicaid under Section 1931 in their own right.

The transitional family includes:

· family members who were in the AFDC Medicaid under Section 1931
assistance unit when the AFDC Medicaid under Section 1931 was terminated,
and

· family members who have since entered the household and who would be
included in the assistance unit if the family were applying for AFDC
Medicaid under Section 1931 in the current month.
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The earned income of an individual who has entered or returned to the
family unit is included in the gross earnings and that individual is
counted when determining the family size. Follow the income rules of the
ABC program. The earned income of a dependent child, regardless of student
status, is not counted.

Example

A grandmother is payee for her two grandchildren. They have been receiving
AFDC Medicaid under Section 1931 for two years. The children's mother has
been in prison during this period. She is released from prison and returns
to the home. She becomes payee for the children and herself. Within two
months, she becomes employed and her earnings cause AFDC Medicaid
ineligibility. Is the family eligible for transitional Medicaid?

No. The family (Mom and two children) did not receive AFDC Medicaid in
three of the six preceding months.

Example

A mother and her child are receiving transitional Medicaid. The father of
the child returns to the home in the second 12 month period. How does his
return to the home affect the family's continued eligibility for
transitional Medicaid?

Since AFDC policy requires that a natural father be included in the
assistance unit, the father is considered to be a member of the family unit
for transitional Medicaid. We must use the family composition rules for
Medicaid under Section 1931. The family composition rules for Medicaid
under Section 1931 are the same as the family composition rules for ABC.
The natural father must be included in the assistance unit .His earnings
are considered in determining if the family's earned income exceeds 185% of
the federal poverty level (FPL). If the family remains eligible, the father
is also eligible for transitional Medicaid.

Example

A mother receiving transitional Medicaid gives birth and the baby is deemed
eligible. Is the baby counted when establishing family size for purposes of
the 185% FPL test?

Yes.

Sanctioned Individuals

Individuals who are under any AFDC sanction may be included as part of the
transitional family during both the
first and second 12-month periods. This includes:

· individuals who have not received 3 out of 6 months prior to the month of
ineligibility (i.e., were not included on the grant) because of a sanction,
and

· sanctioned individuals who are not on the grant in the month of
ineligibility for AFDC.

Individuals who are under any ABC sanction are eligible for Medicaid under
Section 1931. These individuals are included in the transitional family.

Eligibility Determination

Families who lose AFDC Medicaid under Section 1931 because of earnings or
loss of earned income disregards are eligible for transitional Medicaid
when their income exceeds either 185% of the standard of need OR the
standard of need. The standard of need is the same as the ABC standard of
need.

NUMBER OF 185% OF THE STANDARD OF

PEOPLE IN STANDARD OF NEED (75% FPL)**

BUDGET NEED*

1 $ 912 $ 493

2 1,228 664

3 1,541 833

4 1,857 1,004

5 2,170 1,173

6 2,484 1,343

7 2,800 1,514

8 3,115 1,684

* Add $318 per person above eight in the family

** Add $170 per person above eight in the family

Example

185% Standard of Need $1,541 Standard of Need $833

Mrs. Johnson receives AFDC Medicaid under Section 1931. She earns $7.00 per
hour and works 40 hours per week. Her monthly income is $1212.40 ($7.00 x
40 x 4.33). She has been receiving the 30 and 1/3 disregard. Budget
follows:

$1212.40 monthly earned income

- 90.00 earned income deduction

1122.40

- 30.00 $30 disregard

1092.40

- 364.13 1/3 disregard
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$ 728.27 net income < $833 standard of need

Her income does not change but she will lose 1/3 disregard effective
December. Without the 1/3 disregard her countable income is $1092.40. This
exceeds the standard of need of $833 and the family is ineligible for
Medicaid under Section 1931 because of earnings. The family is eligible for
transitional Medicaid beginning December 1.

Month of Ineligibility for AFDC Medicaid under Section 1931

Transitional Medicaid begins with the month following the last month in
which AFDC was correctly received. An AFDC payment is not correctly
received when it is recoverable as an overpayment.

If ineligibility results because of an increase in income, the worker
determines if income received in the month it began was enough to make the
family unit totally ineligible. If so, the payment must be recovered in an
overpayment. Anytime ineligibility occurs after the first day of the month
because of increased income, the case must be closed effective the
following month. When the change is reported too late in the month to allow
advance notice, the case is closed effective the next month.

Transitional Medicaid begins with the month of ineligibility for Medicaid
under Section 1931 due to an increase in income or loss of earned income
disregards. The month of ineligibility for Medicaid is the month in which
the family's income exceeds either 185% of the standard of need or the
standard of need. The standard of need for Medicaid under Section 1931 is
the same as the ABC standard of need.

Example: Ms. Smith reports a new job on November 3 and is determined
prospectively ineligible. She is also ineligible for November. The family
income exceeds the standard of need. Transitional Medicaid begins in
November because that is the month AFDC the family income exceeds the
standard of need for Medicaid under Section 1931 .

Example: Ms. Little begin working November 27 and reports to her worker
promptly. The family is determined prospectively ineligible for ABC and
Medicaid under Section 1931 for December. Because of advance notice
requirements, the case is closed on December 31. The transitional Medicaid
period begins in December because December is the month of ineligibility
for AFDC the family income exceeds the standard of need.

Someone who is not timely in reporting the start of
employment or increased wages could have their family's transitional
benefits reduced so that they only receive the 24 months of transitional
coverage from when they should have been closed. But, we will not totally
disqualify a family.

Example: Mrs. Thomas begins working on April 15, 1996. She does not report
her job until she receives her first pay on May 25. Because of advance
notice requirements, her case is not closed until June 30, 1996. She should
have reported April 15 and her AFDC case would have been closed April 30,
1996. The family income exceeds the standard of need in May. The
transitional Medicaid should begin on May 1, 1996, and finish April 30,
1998.

Eligibility During the First 12-Month Period

The family will receive Transitional Medicaid without any reapplication for
the first 12 months. The family must be notified at the time of the
termination of AFDC when they lose eligibility for Medicaid under Section
1931 that they are eligible for transitional Medicaid and the reasons why
the benefits could be terminated. DCIS will automatically notify AFDC
transitional Medicaid families and issue a card for the AFDC family
members. The notice will include this information about termination of
benefits.

To continue to receive Medicaid throughout the first 12-month period the
following conditions must be met in addition to the initial eligibility
requirements:

there is a child living in the home.

The rules of ABC are used to determine if a child is living in the home.
When it is determined that a family no longer has a child living in the
home, the family is no longer eligible under this program. The case must be
reviewed to determine if the family members are eligible for Medicaid under
another program.

Eligibility During Second 12-Month Period

A redetermination of eligibility must be completed at the end of the first
12-month period. To continue to receive Medicaid during the second 12-month
period, the following conditions must be met in addition to the initial
eligibility requirements:

1. there is a child living in the home, and

2. the caretaker relative is employed during each month unless good cause
exists, and
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3. the family's gross monthly earnings (less the monthly costs of necessary
child care) are at or below 185% of the Federal Poverty Level (FPL) and
continue to be at or below 185% FPL throughout the second 12-month period.

There are no limits on necessary child care costs. Prospective budgeting is
used to determine family income. Do not add unearned income to earned
income. Count the earned income of all family members (except the earned
income of a dependent child, regardless of student status) living in the
home who were members of the family unit the month the family became
ineligible for AFDC Medicaid under Section 1931 and any individual who
would be included in the caretaker relative's assistance unit if the family
were now applying for AFDC Medicaid under Section 1931.

Income Limits for Second 12 Months

Family Size Income Limit $

1 1,217

2 1,636

3 2,056

4 2,475

5 2,894

6 3,314

7 3,733

8 4,152

9 4,572

10 4,991

Good cause for terminating employment is:

1. Circumstances beyond the individual's control such as but not limited to
illness, illness of another family member requiring the wage earner's
presence, a household emergency, the unavailability of transportation, and
the lack of adequate child care.

2. Instances in which employment was unsuitable such as:

· wages offered less than the Federal minimum wage,

· employment on a piece-rate basis and the average hourly yield the
employee receives is less than the Federal minimum wage,

· unreasonable degree of risk to one's health and safety,

· the individual is physically or mentally unfit to perform the employment
as documented by medical evidence or reliable information from other
sources,

· the distance from the individual's house to place of employment is
unreasonable considering the expected wage and the time and cost of
commuting,

· the working hours or nature of employment interferes
with the members religious observance, convictions or beliefs.

3. Discrimination by an employer based on age, race, sex, disability,
religious belief, national origin, or political belief.

4. Work demands or conditions that are unreasonable such as working without
being paid on schedule.

5. Acceptance of other employment or enrollment at least half-time in a
school, training program, or college.

6. Resignations by persons under the age of 60 that are recognized by the
employer as retirement.

7. Leaving a job in connection with patterns of employment in which workers
move from one employer to another as in migrant farm labor or construction
work.

24-month Period of Eligibility

A family gets 24 months of transitional Medicaid from the month of
ineligibility for AFDC Medicaid under Section 1931, even if they become
eligible again for AFDC Medicaid under Section 1931. The clock on the
24-month period does not stop running when AFDC eligibility for Medicaid
under Section 1931 is reestablished. The 24 months of transitional Medicaid
run concurrently with months of AFDC eligibility for Medicaid under Section
1931.

If the family is again loses eligibility for AFDC Medicaid under Section
1931 for non-work reasons, the transitional benefit period is unaffected.
If the family is terminated again for earned income reasons, a new
transitional period may begin.

Example 1

A mother and her children have received AFDC Medicaid under Section 1931
continuously since April 1997. Mom becomes employed and loses AFDC
eligibility for Medicaid under Section 1931 effective October 1997 due to
earned income. The family is determined eligible for transitional Medicaid
effective October. In December she loses her job and applies for AFDC ABC.
She is approved for AFDC ABC effective January 1998. She is also eligible
for Medicaid under Section 1931. She becomes employed again in February and
her earned income causes her to be ineligible for AFDC Medicaid under
Section 1931 in February. Does the family continue with the original
transitional period?
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No. A new 24 month period of transitional Medicaid begins in February. When
AFDC Medicaid under Section 1931 eligibility was lost in February because
of earnings, the family had received AFDC Medicaid under Section 1931 in
three of the six preceding months. The six preceding months are January
1998, December, November, October, September, and August 1997. The family
received AFDC Medicaid under Section 1931 in January 1998, September and
August 1997.

Example 2

A family is determined eligible for transitional Medicaid from 11/1/96 to
10/31/98. The mother is employed for the entire period. The family becomes
eligible for AFDC Medicaid under Section 1931 during May and June 1997. The
family becomes ineligible for AFDC Medicaid under Section 1931 due to wages
effective July. Does the family continue with the original transitional
period?

Yes. The family is not eligible for a new transitional Medicaid period
because the family did not receive Medicaid under Section 1931 in the six
months preceding the month of ineligibility (July). The family continues to
be eligible for the original transitional Medicaid period.

Example 3

A family has been receiving AFDC Medicaid under Section 1931 from June 1997
to October 1997. The AFDC Medicaid under Section 1931 is closed for earned
income and transitional Medicaid begins November 1997. In December Mom
loses her job and the family is opened in AFDC ABC. The family is also
eligible for Medicaid under Section 1931. In January 1998 Mom is approved
for Social Security and the AFDC ABC case and Medicaid under Section 1931
are closed 1/31/98. Is the family eligible for transitional Medicaid?

Yes. The family continues with the transitional Medicaid period that began
in November 1997.

Reporting Requirements

The Social Security Act at §1925 describes the reporting requirements under
Transitional Medicaid.

Effective 11/1/95 Delaware's welfare reform program "A Better Chance"
eliminated monthly reporting requirements for AFDC families and the Section
1115 Medicaid Demonstration Waiver, "Diamond State Health Plan" eliminated
the quarterly reporting requirements for Transitional Medicaid. Instead,
families are required to report significant changes in circumstances. A
significant
change in circumstances is as follows:

· change in household size

· a new job

· a change from full-time to part-time employment

· loss of employment

· an increase or decrease of forty hours in employment per month

· a new unearned income

· unearned income goes up or down more than $50.00 per month

NOTE: Changes in unearned income do not affect continued eligibility for
transitional Medicaid.

The eligibility requirements for transitional Medicaid remain the same;
however, the family does not have to meet the reporting requirements
described at §1925 of the Social Security Act.

Termination of Benefits

First 12-month period

Medicaid benefits will be terminated if:

1. The family no longer has a child living in the home. Use the definition
for child as defined under AFDC Section 1931 Medicaid. A child is under age
18 or is under age 19 and who is still a full-time student in high school,
GED, or equivalent program and will graduate prior to his or her 19th
birthday.

2. The family is found to have received AFDC Medicaid under Section 1931
"fraudulently" in the preceding six months. Fraud is defined at the end of
this section.

Second 12 month period

Medicaid benefits will be terminated if:

1. The famly no longer has a child (defined above) living in the home.

2. The caretaker relative is no longer employed and good cause does not
apply.

3. The family's monthly gross earned income minus child care costs exceeds
185% FPL.

We must explore eligibility for any other Medicaid program before
transitional Medicaid is terminated.

Notices
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Families who lose AFDC Medicaid under Section 1931 receive a notice that
advises them of the eligibility requirements for continued coverage under
transitional Medicaid. The notice contains a statement advising families of
the right to extended Medicaid benefits and an explanation of circumstances
that could result in termination during the extended periods.

Fraud

Section 1925(d) of the Social Security Act specifies that extended Medicaid
must not be granted to any individual who has committed fraud during the
last 6 months in which the family was receiving aid before otherwise being
provided extended Medicaid eligibility. been legally determined by the
Medicaid agency to be ineligible for Medicaid under Section 1931 because of
fraud at any time during the last prior six months in which the family
received Medicaid under Section 1931. The fraud determinations are subject
to the fraud and program abuse provisions under Sections 1128, 1128A, and
1128B of the Social Security Act.

Under the AFDC program, a determination of fraud must be made following a
hearing. Under Medicaid, a conviction for fraud must be made by a court of
competent jurisdiction.

For purposes of the exclusion from transitional Medicaid, an individual is
considered to have been convicted of a criminal offense:

when a judgment of conviction has been entered against the individual by a
Federal, State, or local court, regardless of whether there is an appeal
pending or whether the judgment of conviction or other record relating to
criminal conduct has been expunged;

when there has been a finding of guilt against the individual by a Federal,
State, or local court;

when a plea of guilty or nolo contendere by the individual has been
accepted by a Federal, State, or local court; or

when the individual has entered into participation in a first offender or
other program where judgment of conviction has been withheld.

301.60 Prospective Program (Child Support)

42 CFR 435.115(f),(g),(h)

Section 406(h) of the Social Security Act

An individual will be deemed to be receiving AFDC if a
new collection or increased collection of child or spousal support under
title IV-D of the Social Security Act results in the termination of AFDC
eligibility according to section 406(h) of the Social Security Act. This
regulation also covers families that do not receive a grant because their
need is below $10.00. Medicaid will be continued for four consecutive
calendar months, beginning with the first month of AFDC ineligibility, to
each dependent child and each relative with whom such a child is living
(including the eligible spouse of such relative) who:

· becomes ineligible for AFDC on or after August 16, 1984; and

· has received AFDC for at least three of the six months immediately
preceding the month in which the individual becomes ineligible for AFDC;
and

· becomes ineligible for AFDC wholly or partly as a result of new or
increased child or spousal support collections under title IV-D.

The Personal Responsibility and Work Opportunity Reconciliation Act of 1996
(PRWORA), P.L. 104-193, repealed the AFDC program and replaced it with a
program of block grants to states for Temporary Assistance for Needy
Families (TANF). Prior to PRWORA, a family's eligibility for Prospective
Medicaid was linked to receipt of AFDC. Under PRWORA, a family's
eligibility for Prospective Medicaid is linked to receipt of Medicaid under
Section 301.15, "Low Income Families with Children under Section 1931.

NOTE: All references to Medicaid under Section 1931 also include families
who receive ABC benefits. ABC families are also eligible for Medicaid under
Section 1931.

Medicaid eligibility is extended for four consecutive months to families
who become ineligible for Medicaid under Section 1931 because of a new or
increased collection of child or spousal support under title IV-D of the
Social Security Act.

Collection of Support

Regulations require that the collection of support made by absent parents
and spouses be paid directly to the IV-D agency; the Division of Child
Support Enforcement (DCSE). AFDC Medicaid recipients occasionally receive
child or spousal support directly. Extended Medicaid coverage will be
provided when collections of child or spousal support that are received by
the assistance unit are turned over to the DCSE. Support payments that are
not forwarded to the DCSE do not constitute a "collection" under title
IV-D; therefore, the family would not be eligible for prospective Medicaid.
The amount of support ordered
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is not material when establishing eligibility for prospective Medicaid.
Eligibility is based on the amount of support collected.

Eligibility Determination

The family is eligible if the collected support exceeds 185% of the
standard of need or the standard of need. The collection of support must
actually

cause or actively contribute to ineligibility for AFDC, even if there are
other factors that also contribute to ineligibility or could simultaneously
cause it.

At the time the family becomes ineligible for Medicaid under Section 1931,

determine whether the family meets the following three requirements:

1. The family has received Medicaid under Section 1931 in three of the six
months immediately preceding the month the family became ineligible for
Medicaid under Section 1931.

2. The family lost eligibility for Medicaid under Section 1931 wholly or
partly as a result of new or increased child or spousal support collections
under title IV-D. The family is eligible if the collected support exceeds
185% of the ABC standard of need or the ABC standard of need. The
collection of support must actually cause or actively contribute to
ineligibility for Medicaid under Section 1931, even if there are other
factors that also contribute to ineligibility or could simultaneously cause
it.

Example

An family receives $300 in countable child support collections and $400 in
Social Security benefits. The standard of need is $833. In the next month
both the child support collection and the Social Security benefit increase
by $150, for a total increase of $300 a month. The family is ineligible for
AFDC Medicaid under Section 1931 due to the child support collection
because the change in support by itself, when added to the unchanged Social
Security would cause ineligibility for AFDC Medicaid under Section 1931.
The family is eligible for extended Medicaid.

Example

An family receives $750 in countable child support collections and the
standard of need is $1004. In the next month, the countable child support
collection increases to $900 and at the same time one of the older children
leaves home. As a result, the standard of need is reduced to $833. The
countable child support collection of $900 exceeds
the new standard of need of $833. The family is eligible for extended
Medicaid, since the collection of child support increased and contributed
to the ineligibility for AFDC Medicaid under Section 1931. The reduction in
the standard of need worked in combination with the increased support
collection to cause the ineligibility. Thus, the support collection
contributed to the family's ineligibility for AFDC Medicaid under Section
1931. Neither change would have caused ineligibility by itself.

However, suppose that in this example the $750 in support collection was
raised to $900 and the $1004 standard of need was reduced to $664. In this
case, the increase in support collection would have no effect on
eligibility for AFDC Medicaid under Section 1931. That is because the
change in the standard of need would have caused ineligibility for AFDC
Medicaid under Section 1931 even before the child support collection was
raised from $750 to $900. Because the change in the support collection did
not cause or contribute to ineligibility for AFDC Medicaid under Section
1931, the family would not be eligible for prospective Medicaid.

3. The family must continue to have a dependent child living in the home.

The family must continue to have a child living in the home that meets the
age requirement for Medicaid under Section 1931; that is, an individual
under age 18 or under age 19, and who is still a full-time student in high
school, GED, or equivalent program and will graduate prior to his or her
19th birthday.

Month of Ineligibility for AFDC Medicaid under Section 1931

Families are eligible for prospective Medicaid beginning with the month of
ineligibility for Medicaid under Section 1931 due to a new or increased
collection of support. The month of ineligibility for Medicaid under
Section 1931 is the month in which the family's income exceeds either 185%
of the standard of need or the standard of need. The standard of need for
Medicaid under Section 1931 is the same as the ABC standard of need.

If a family's ineligibility for an AFDC grant Medicaid under Section 1931
is a result of the collection or increased collection of support and
employment or increased earnings, review the file to determine which factor
caused the ineligibility. If the collection of support was the determining
factor the family will qualify for four months of continued coverage. If it
is determined that earnings caused the ineligibility, the family will
qualify for up to 24 months of continued coverage under transitional
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Medicaid. (See Section 301.55) If a family is eligible for extended
Medicaid under Transitional Medicaid as a result of earned income and is
also simultaneously eligible to extended Medicaid as a result of the
support collection, the family is eligible for up to 24 months of extended
Medicaid. The periods of extended Medicaid run concurrently.

Family Unit

All members of the family unit who were eligible for AFDC Medicaid under
Section 1931 are eligible for the four months continued coverage. In
addition, family members who enter or return to the household are eligible
for prospective Medicaid if that individual would have been included in the
assistance unit if the family were now applying for AFDC Medicaid under
Section 1931. Individuals under an ABC sanction are eligible for Medicaid
under Section 1931 any may be found eligible for the four month extension.
If a member of the family is added to an existing AFDC assistance unit that
is receiving Medicaid under Section 1931 and the mother receives an
increase in support the same month the member is added, that member is
entitled to four months of continued Medicaid. A child born to the family
during the fourmonth period will also be covered through the end of the
four month period. Remember a child born to a Medicaid mother is deemed
eligible for one year.

A person or family who becomes ineligible during the fourmonth period for
reasons other than the collection or increased collection of support (such
as a child who attains age 18 or a family member who leaves the household)
will not be entitled to continued coverage beyond the date of
ineligibility.

Prospective Medicaid ends for any individual family member who moves to
another state. Coverage ends the month following the month the individual
moves to the new state. Eligibility can be reinstated if the individual
returns during the four-month period. For example, if the family moved to
another state in March, the first month of prospective Medicaid, and moved
back in May, the family would again be eligible for prospective coverage in
May and June.

There is no requirement that a member of the family be employed throughout
the fourmonth period.

—END OF MANUALS—

Comments or requests for copies of proposed changes or relevant materials
may be made in writing to: Medicaid Administrative Offices, Division of
Social Service, P.O.
Box 906, New Castle, DE 19720, attention: Thelma G. Mayer, or by calling
(302) 577-4880, extension 131, or may be viewed at the following locations:
New Castle County: Medicaid Office, Lewis Bldg., Herman M. Holloway, Sr.
Health & Social Services Campus, 1901 N. DuPont Hwy., New Castle, DE,
19720; Kent County: Medicaid Unit, Division of Social Services, Williams
State Service Center, 805 River Rd., Dover, DE 19901; Sussex County:
Medicaid Unit, Division of Social Services, Georgetown State Service
Center, 546 S. Bedford St., Georgetown, DE, 19947. Comments, written
suggestions, compilations of data, testimony, briefs or other written
materials concerning the proposed change must be received by mail no later
than March 1, 1998, at the Medicaid Administrative Office, Lewis Bldg.,
Herman M. Holloway, Sr. Health & Social Services Campus, 1901 N. DuPont
Hwy., New Castle, DE 19720, attention Thelma Mayer. Materials filed
thereafter will not be considered except where good cause for lateness is
demonstrated. Copies of all written submissions filed with the Medicaid
office will be available for public inspection in the Medicaid
Administrative Office at the address given above. Please call (302)
577-4800, ext.131 for an appointment if you wish to review the materials.
Individuals with disabilities who wish to participate in these proceedings,
or review the materials submitted, should contact the Division to discuss
auxiliary aids or services needed to facilitate such review or
participation. Such contact may be in person, in writing or by telephone by
using the Telecommunications Relay Service, or otherwise.
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Department of Justice

Delaware Securities Act

Statutory Authority: 6 Delaware Code,

Sections 7306(a)(17), 7307, 7309(b)(2), 7309(b)(9), 7309(c), 7309A(f),
7312, 7314(b)(4), 7317(c), 7325(b) (6 Del.C. §§7306(a)(17); 7307;
7309(b)(2), (b)(9), (c); 7309A(f); 7312, 7314(b)(4), 7317(c), 7325(b))

NOTICE OF ISSUANCE OF

PROPOSED RULES AND REGULATIONS

PURSUANT TO THE DELAWARE SECURITIES ACT

The Securities Commissioner is issuing for notice and comment proposed
rules and regulations pursuant to the Delaware Securities Act. The proposed
rules and regulations are intended to replace the current regulations and
cover the following subject areas:
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A. Organization and Functions of the Securities Division

B. Practice and Procedure in Administrative Hearings

C. Investigations

D. Securities Registration and Notice Filings

E. Exemptions from Registration

F. Broker-Dealers, Broker-Dealer Agents and Issuer Agents

G. Investment Advisers and Investment Adviser Representatives

The proposed rules and regulations are issued pursuant to the authority
granted in 6 Del. C. §§7306(a)(17), 7307, 7309(b)(2), 7309(b)(9), 7309(c),
7309A(f), 7312, 7314(b)(4), 7317(c) and 7325(b).

Comments may be presented in writing to the attention of Charles F. Walker,
Securities Commissioner, State of Delaware Department of Justice, 820 N.
French Street, Wilmington, Delaware, 19801. Comments must be received no
later than 5:00 p.m. on March 5, 1998, for consideration.

Attachments:

Index to Proposed Rules and Regulations

Text of Proposed Rules and Regulations

Cross-reference to Existing Regulations

INDEX TO PROPOSED RULES AND REGULATIONS

PROPOSED RULES AND REGULATIONS PURSUANT TO THE DELAWARE SECURITIES ACT

Part A. Organization and Functions of the Securities Division

100 General Statement and Statutory Authority

101 Regulatory Functions

102 General Organization

103 Administrative Hearing Officers

Part B. Practice and Procedure in Administrative Hearings

General Rules

200 Construction of Rules of Practice and Procedure

201 Appearance and Practice in Administrative Proceedings

202 Business Hours

203 Delegated Authority of Administrative Hearing Officer

204 Disqualification and Recusal of Administrative Hearing Officer

205 Ex Parte Communications

206 Orders and Decisions of Administrative Hearing Officer

Service and Filing of Papers

210 Service of Papers by Parties

211 Filing of Papers with the Commissioner: Procedure

212 Filing of Papers: Form

213 Filing of Papers: Signature Requirement and Effect

214 Computation of Time

Pleadings and Prehearing Practice

220 Complaints: General

221 Complaints: Form and Content

222 Complaints: Amendment and Withdrawal

223 Order Delegating Authority to Hearing Officer

224 Answers to Complaints

225 Request for Hearing

226 Prehearing Conferences

227 Prehearing Submissions

228 Disclosure of Evidence by the Parties

229 Production of Witness Statements

230 Motions

231 Motions for Summary Disposition

232 Default; Motion to Set Aside Default

Administrative Hearings

240 Hearings

241 Hearings Open to the Public

242 Continuance of Hearing

243 Procedure

244 Testimony

245 Evidence: Admissibility

246 Evidence: Objections and Offers of Proof

247 Evidence: Reference to Delaware Uniform Rules of Evidence

248 Proposed Findings of Fact, Conclusions of Law and Post-Hearing Briefs

249 Record of Hearings

250 Supplementation of Record

251 Decision of Administrative Hearing Officer

252 Failure to Appear at Hearing: Default

253 Contemptuous Conduct

Practice and Procedure Regarding Summary Orders Issued Pursuant to Sections
7308(c), 7309(c), 7316(c) and Section 7325(c) of the Act

260 Basis for Issuance of Summary Order Postponing or Suspending the
Effectiveness of a Registration

Statement Pursuant to Section 7308(c)

261 Basis for Issuance of Summary Order Denying or Revoking Exemption
Pursuant to Section 7309(c)

262 Basis for Issuance of Summary Order Postponing or Suspending the
Registration of a Broker-Dealer,
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Broker-Dealer Agent, Investment Adviser or Investment Adviser
Representative Pursuant

To Section 7316(c)

263 Basis for Issuance of Summary Cease and Desist Order Pursuant to
Section 7325(c)

264 Application for Issuance of Summary Order

265 Procedure After Issuance of Order

266 Violation of Cease and Desist Order

Appeal to the Court of Chancery

270 Right to Judicial Review

271 Procedure

272 Application to the Court for Leave to Adduce Additional Material
Evidence

Part C. Investigations

300 Scope of Rules Regarding Investigations

301 Nature and Purpose of Investigations

302 Information Obtained in Investigations

303 Rights of Witnesses

304 Subpoenas

305 Testimony Under Oath

306 Production of Things and Documents

307 Written Submissions by Interested Persons

Part D. Securities Registration and Notice Filings

400 Registration by Coordination

401 Registration by Qualification

402 Small Company Offering Registration

403 Notice Filings for Offerings of Investment Company Securities

404 Fees

405 Quarterly Reports on Registered Securities

406 Filing of Sales Literature

407 Notice Filings for SEC Regulation D Offerings

Part E. Exemptions from Registration

500 Exemptions for Federal Covered Securities

501 Designated Exchange Exemption

502 Limited Offering Exemption

503 Accredited Investor Exemption

504 World Class Issuer Exemption

505 Offers of Securities through the Internet

506 Claim of Exemption by Persons Organized Not for Private Profit but
Exclusively for

Religious Purposes

507 Claim of Exemption for Nine-Month Commercial Paper

508 Recognized Securities Manuals

509 Unsolicited Sales

510 Transactional Exemption for Certain Institutional
Buyers

511 Confirmation of Availability of Exemption

Part F. Broker-Dealers, Broker-Dealer Agents and Issuer Agents

600 Registration of Broker-Dealers

601 Registration of Broker-Dealer Agents

602 Registration of Issuer Agents

603 Continuing Obligation of Registrants to Keep Information Current

604 Minimum Financial Requirements and Financial Reporting Requirements of
Broker-Dealers

605 Bonding Requirements of Intrastate Broker-Dealers

606 Recordkeeping Requirements of Broker-Dealers

607 Use of the Internet for General Dissemination of Information on
Products and Services

608 Registration Exemption for Certain Canadian Broker-Dealers

609 Prohibited Practices

Part G. Investment Advisers and Investment Adviser Representatives

700 Registration of Investment Advisers

701 Registration of Investment Adviser Representatives

702 Notice Filing Requirements for Federal Covered Advisers

703 Continuing Obligation of Registrants to Keep Information Current

704 Minimum Financial Requirements for Investment Advisers

705 Bonding Requirements of Certain Investment Advisers

706 Recordkeeping Requirements of Investment Advisers

707 Use of the Internet for General Dissemination of Information on
Products and Services

708 Custody of Client Funds or Securities

709 Prohibited Practices

* Please note that the above page numbers refer to the original document,
not to pages in the Register.

PROPOSED RULES AND REGULATIONS PURSUANT TO THE DELAWARE SECURITIES ACT

Part A. Organization and Functions of the Securities Division

§100 General Statement and Statutory Authority
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The Securities Division was created in 1973 with the passage of the
Delaware Securities Act, which is found at Chapter 73 of Title 6 of the
Delaware Code. The Securities Act is administered by the Attorney General
through a Deputy Attorney General designated to act as Securities
Commissioner. The Securities Commissioner is the principal executive
officer of the Securities Division and acts for the Attorney General in
administering that statute. The purpose of the Delaware Securities Act is
to prevent the public from being victimized by unscrupulous or
over-reaching broker-dealers, investment advisers or agents in the context
of selling securities or giving investment advice, as well as to remedy any
harm caused by securities law violations. The Act provides for the
following:

(a) Public disclosure of pertinent facts concerning public offerings of
securities to Delaware investors, and protection of the interests of those
investors in connection with the offer and sale of securities.

(b) Investigation of securities frauds, manipulations and other violations,
and the imposition and enforcement of legal sanctions therefor.

(c) Registration and the regulation of certain activities of
broker-dealers, broker-dealer agents and issuer agents.

(d) Registration and the regulation of certain activities of
state-registered investment advisers and investment adviser
representatives.

(e) Administrative sanctions, injunctive and other equitable remedies, and
criminal prosecution. There are also private rights of action for investors
injured by violations of the Act.

§101 Regulatory Functions

Following is a brief description of the Securities Division's regulatory
functions under the Delaware Securities Act:

(a) Securities Registration and Notice Filings. (1) It is unlawful for any
person to sell a security in Delaware unless that security is registered;
or the security or transaction is exempt under Section 7309 of the Act; or
the security is a federal covered security for which a notice filing has
been made pursuant to Section 7309A of the Act. Securities for which a
federal registration statement has been filed under the Securities Act of
1933 may be registered by coordination under Section 7305. Any security may
be registered by qualification under Section 7306. Notice filings are
required for federal covered securities offered or sold to Delaware
investors. A stop order prohibiting the offering of a security, or
suspending or revoking the effectiveness of a registration statement, may
be issued where the offeror has made a material misstatement or omission in
connection with that offer, or otherwise where the public interest so
dictates and the
statutory criteria of Section 7308 are met. Any registrant or offeror
subject to such an order is entitled to a hearing under the Act.
Registration or the filing of a notice filing is not a finding by the
Commissioner as to the accuracy of the facts disclosed; and it is unlawful
to so represent. Moreover, registration of securities or the filing of a
notice filing does not imply approval of the issue by the Commissioner or
insure investors against loss in their investment, but serves rather to
provide information upon which investors may make an informed and realistic
evaluation of the worth of the securities.

(2) Persons responsible for filing false information with the Commissioner
or otherwise disseminating false and misleading information in connection
with the purchase or sale of securities subject themselves to the risk of
fine or imprisonment or both; and the issuing company, its directors,
officers, and the underwriters and dealers and others may be liable in
damages to purchasers of registered securities if disclosures are
materially defective. In addition, the statute contains antifraud
provisions which apply generally to the sale of securities, whether or not
registered.

(b) Registration and Licensing of Broker-Dealers, Broker-Dealer Agents and
Issuer Agents. The Act provides for registration with, and regulation by,
the Commissioner of broker-dealers, broker-dealer agents and issuer agents.
Registrations must be renewed annually. The activities of broker-dealers,
broker-dealer agents and issuer agents in the conduct of their business are
subject to the standards of the Act, which include a prohibition on
dishonest or unethical practices within or outside the State, and which
make unlawful those practices which would constitute fraud or deceit.
Applications for registration may be denied, and registration may be
suspended or revoked, where the public interest so dictates and the
statutory criteria of Section 7316 are met. Any registrant subject to such
an order is entitled to a hearing under the Act. Respondents in
disciplinary hearings under Section 7316 may also be subject to fines,
costs, orders requiring restitution and/or disgorgement, and other orders
in the public interest, as well as criminal prosecution under Section 7322.

(c) Registration and Licensing of Investment Advisers and Investment
Adviser Representatives; Notice Filings for Federal Covered Advisers. The
Act provides that persons who, for compensation, engage in the business of
advising others with respect to securities transactions must register with
the Commissioner unless they are registered with the Securities and
Exchange Commission ("SEC") or otherwise exempted from registration under
the Act. Federal covered advisers (those registered with the SEC) who have
a place of business in Delaware or who had more than five Delaware
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residents as clients in the past 12 months must file a notice filing and
filing fee with the Commissioner as provided by Section 7314 of the Act.
All investment adviser representatives (whether employed by or associated
with a federal covered adviser or a state-registered adviser) who have a
place of business in Delaware must register with the Commissioner.
Registrations must be renewed annually. The activities of investment
advisers and investment adviser representatives in the conduct of their
business are subject to the standards of the Act, which include a
prohibition on dishonest or unethical practices within or outside the
State, and which make unlawful those practices which would constitute a
fraud or deceit. Applications for registration may be denied, and
registration may be suspended or revoked, where the public interest so
dictates and the statutory criteria of Section 7316 are met. Any registrant
subject to such an order is entitled to a hearing under the Act.
Respondents in disciplinary hearings under Section 7316 may also be subject
to fines, costs, orders requiring restitution and/or disgorgement, and
other orders in the public interest, as well as criminal prosecution under
Section 7322.

§102 General Organization

(a) The Securities Division is part of the Fraud Division of the State
Department of Justice. In addition to the Securities Commissioner, the
Securities Division has a staff which includes lawyers, a securities
analyst, investigators and examiners, as well as administrative and
clerical employees. The Securities Commissioner and other staff members
shall perform, in addition to their duties under the Securities Act, such
additional duties as the Attorney General may assign from time to time.

(b) The Securities Division is a statewide office with authority over all
three counties in Delaware. The Securities Commissioner is located at 820
North French Street, Wilmington, Delaware, 19801. The telephone number is
(302) 577-8424. The Securities Division's Kent County mailing address is 45
The Green, Dover, Delaware, 19901.

(c) Enforcement activities are conducted and supervised by Deputy Attorneys
General assigned to the Division with the assistance of staff securities
investigators. Administrative and injunctive actions may be instituted and
prosecuted by a Deputy Attorney General after review and determination that
there exists sufficient evidence to support the allegations in any proposed
complaint. Criminal charges may be presented to the Grand Jury for
indictment after review by the Director of the Fraud Division and/or the
State Prosecutor.

(d) Registration and renewal of securities filings are reviewed by the
Securities Division for adherence to standards of reporting and financial
disclosure under the Securities Act, as well as substantive business
requirements
of the Act. The staff also reviews exempt securities filings for compliance
with the exemptive provisions of Section 7309 and the disclosure
requirements of the Act.

(e) Registration of broker-dealers, broker-dealer agents, issuer agents,
investment advisers and investment adviser representatives is conducted by
staff members in the Division's Firm/Agent Registration Section, with
review and oversight by the Securities Commissioner and other Deputy
Attorneys General.

(f) Compliance audits and examinations of state-registered investment
advisers are undertaken by the Division's investment adviser examiners on a
periodic basis. Special examinations of both broker-dealers and investment
advisers may also be undertaken by the staff. Access to all books and
records is required in any examination pursuant to Section 7315 of the Act.
The Securities Division may cooperate, by joint examination or otherwise,
with the securities administrators of other states, the SEC, and any other
national securities exchange or national securities association registered
under the Securities Exchange Act of 1934.

(g) The Securities Division is also responsible for the Attorney General's
investor education program. The Program includes, but is not limited to:

(1) Presenting seminars and instructional programs to educate investors
about the securities markets and their rights as investors; preparing and
distributing to the public materials describing the operations of the
securities markets, prudent investor behavior, and the rights of investors
in disputes they may have with individuals and entities regulated by the
Commissioner; and increasing public knowledge of the functions of the
Securities Division.

(2) Providing information to investors who inquire about individuals and
entities regulated by the Commissioner, the operation of the securities
markets, or the functions of the Securities Division.

(h) The Securities Division provides written interpretative opinions under
the Act in response to written requests. Requests for interpretative
opinions should be addressed to the Commissioner and accompanied by a fee
of $75.00 payable to the State of Delaware. Interpretations may be
requested regarding any section of the Act or any rule or regulation
adopted thereunder.

§103 Administrative Hearing Officers

(a) Pursuant to Section 7325(b) of the Act, the Securities Commissioner
hereby delegates to an administrative hearing officer the authority to
preside in any administrative proceeding brought under the Securities Act.
The administrative hearing officer shall have, with respect to any such
proceeding, all powers and duties as are possessed by the Securities
Commissioner when presiding over a proceeding under the Delaware
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Securities Act, and any order issued by the administrative hearing officer
shall constitute an order of the Commissioner for purposes of judicial
review under Section 7324 of the Act.

(b) The administrative hearing officer shall be designated by the Attorney
General or Chief Deputy Attorney General. The administrative hearing
officer may be a Deputy Attorney General (other than a Deputy Attorney
General assigned to the Securities Division) or any other attorney admitted
to practice law in the State of Delaware.

(c) The Rules of Practice and Procedure in Administrative Hearings
(Sections 200-272) shall govern all proceedings by and before the
administrative hearing officer.

Part B. Practice and Procedure in Administrative Hearings

General Rules

§200 Construction of Rules of Practice and Procedure

(a) Unless otherwise provided, these Rules of Practice govern proceedings
before administrative hearing officers under the Delaware Securities Act.
These rules do not apply to investigations by the Securities Division,
which are governed by Part C of the Rules and Regulations.

(b) The Rules of Practice shall be construed and administered to secure the
just, speedy, and inexpensive determination of every proceeding.

(c) In any particular proceeding, to the extent that there is a conflict
between these rules and a procedural requirement contained in any statute,
the latter shall control.

(d) For purposes of these rules: (1) any term in the singular includes the
plural, and any term in the plural includes the singular, if such use would
be appropriate; (2) any use of a masculine, feminine, or neuter gender
encompasses such other genders as would be appropriate; and (3) unless the
context requires otherwise, counsel for a party may take any action
required or permitted to be taken by such party.

§201 Appearance and Practice in Administrative Proceedings

A person shall not be represented before a hearing officer except as stated
in paragraphs (a) and (b) of this section or as otherwise permitted by the
hearing officer:

(a) Representing oneself. In any proceeding, an individual may appear on
his or her own behalf.

(b) Representing others. In any proceeding, a person may be represented by
an attorney at law admitted to practice before the Supreme Court of the
State of
Delaware. Attorneys who are not members of the Delaware Bar may be admitted
pro hac vice pursuant to Rule 72 of the Rules of the Supreme Court of the
State of Delaware.

(c) Requirement of Delaware Counsel. Pursuant to Rule 72(a) of the Delaware
Supreme Court Rules, attorneys who are not members of the Delaware Bar may
be admitted pro hac vice in a proceeding in the discretion of the
administrative hearing officer upon written motion by a member of the
Delaware Bar who maintains an office in this State for the practice of law
("Delaware Counsel"). Pursuant to Delaware Supreme Court Rule 72(c),
Delaware Counsel for any party shall appear in the matter for which
admission pro hac vice is filed and shall sign or receive service of all
notices, orders, pleadings or other papers filed in the matter and shall
attend all proceedings before the administrative hearing officer, unless
excused by that hearing officer.

(d) Designation of address for service; notice of appearance; power of
attorney; withdrawal.

(1) Representing oneself. When an individual first makes any filing or
otherwise appears on his or her own behalf before a hearing officer in a
proceeding, he or she shall file with the Commissioner or otherwise state
on the record, and keep current, an address at which any notice or other
written communication required to be served upon him or her or furnished to
him or her may be sent and a telephone number where he or she may be
reached during business hours.

(2) Representing others. When a person first makes any filing or otherwise
appears in a representative capacity before a hearing officer in a
proceeding, that person shall file with the Commissioner, and keep current,
a written notice stating the name of the proceeding; the representative's
name, business address and telephone number; and the name and address of
the person or persons represented.

(3) Power of attorney. Any individual appearing or practicing before a
hearing officer in a representative capacity may be required to file a
power of attorney with the Commissioner showing his or her authority to act
in such capacity.

(4) Withdrawal. Withdrawal by any individual appearing in a representative
capacity shall be permitted only by written order of the hearing officer. A
motion seeking leave to withdraw shall state with specificity the reasons
for such withdrawal.

(e) Public Hearings. All hearings shall be public unless otherwise ordered
by the hearing officer on his own motion or after considering the motion of
a party.

§202 Business Hours

The office of the Securities Division, at 820 North French Street,
Wilmington, Delaware, 19801, is open
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each day, except Saturdays, Sundays, and State legal holidays, from 8:30
a.m. to 5:00 p.m., Eastern Standard Time or Eastern Daylight Saving Time,
whichever is currently in effect in Wilmington, Delaware. State legal
holidays consist of New Year's Day; Birthday of Martin Luther King, Jr;
Presidents Day; Memorial Day; Independence Day; Labor Day; Columbus Day;
Veterans Day; Thanksgiving Day; Christmas Day; and any other day appointed
as a holiday by the Governor or the State Legislature.

§203 Delegated Authority of Administrative Hearing Officer

The administrative hearing officer, as designated by the Attorney General
or Chief Deputy Attorney General under §103 of these Rules, holds delegated
authority to preside in any administrative proceeding brought under the
Securities Act and shall have in any such proceeding all powers and duties
as are possessed by the Securities Commissioner when presiding over a
proceeding under the Delaware Securities Act, and any order issued by the
administrative hearing officer shall constitute an order of the
Commissioner for purposes of judicial review under Section 7324 of the Act.

§204 Disqualification and Recusal of Administrative Hearing Officer

(a) Notice of disqualification. At any time a hearing officer believes
himself or herself to be disqualified from considering a matter, the
hearing officer shall issue a notice stating that he or she is withdrawing
from the matter and setting forth the reasons therefor.

(b) Motion for Withdrawal. Any party who has a reasonable, good faith basis
to believe that a hearing officer has a personal bias, or is otherwise
disqualified from hearing a case, may make a motion to the hearing officer
that the hearing officer withdraw. The motion shall be accompanied by an
affidavit setting forth in detail the facts alleged to constitute grounds
for disqualification. If the hearing officer finds himself or herself not
disqualified, he or she shall so rule and shall continue to preside over
the proceeding.

§205 Ex Parte Communications

Unless on notice and opportunity for all parties to participate, or to the
extent required for the disposition of ex parte matters as authorized by
Sections 7308(c), 7309(c), 7316(c) and/or 7325(c) of the Act:

(a) No party, or counsel to or representative of a party, shall make or
knowingly cause to be made an ex parte communication relevant to the merits
of a proceeding to the administrative hearing officer with respect to that
proceeding.

(b) No administrative hearing officer with respect
to a proceeding shall make or knowingly cause to be made to a party, or
counsel to or representative of a party, an ex parte communication relevant
to the merits of that proceeding.

§206 Orders and Decisions of Administrative Hearing Officer

(a) Availability for inspection. Each order and decision shall be available
for inspection by the public from the date of entry, unless the order or
decision is nonpublic. A nonpublic order or decision shall be available for
inspection by any person entitled to inspect it from the date of entry.

(b) Date of entry of orders. The date of entry of an order shall be the
date the order is signed. Such date shall be reflected in the caption of
the order, or if there is no caption, in the order itself.

Service and Filing of Papers

§210 Service of Papers by Parties

(a) When required. In every administrative proceeding, each paper,
including each notice of appearance, written motion, brief, or other
written communication, shall be served upon each party in the proceeding in
accordance with the provisions of this section; provided, however, that
absent an order to the contrary, no service shall be required for motions
which may be heard ex parte.

(b) Upon a person represented by counsel. Whenever service is required to
be made upon a person represented by counsel who has filed a notice of
appearance pursuant to §201, service shall be made pursuant to paragraph
(c) of this section upon counsel, unless service upon the person
represented is ordered by the hearing officer.

(c) How made. Service shall be made by delivering a copy of the filing.
Delivery means:

(1) Personal service by handing a copy to the person required to be served;
or leaving a copy at the person's office with a clerk or other person in
charge thereof, or, if there is no one in charge, leaving it in a
conspicuous place therein; or, if the office is closed, or the person to be
served has no office, leaving it at the person's dwelling house or usual
place of abode with some person of suitable age and discretion then
residing therein;

(2) Mailing the papers through the U.S. Postal Service by first class,
registered, or certified mail or Express Mail delivery addressed to the
person;

(3) Sending the papers through a commercial courier service or express
delivery service; or

(4) Transmitting the papers by facsimile machine where the following
conditions are met:

(i) The persons serving each other by
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facsimile transmission have agreed to do so in a writing, signed by each
party, which specifies such terms as they deem necessary with respect to
facsimile machine telephone numbers to be used, hours of facsimile machine
operation, the provision of non-facsimile original or copy, and any other
such matters; and

(ii) Receipt of each document served by facsimile is confirmed by a
manually signed receipt delivered by facsimile machine or other means
agreed to by the parties.

(d) When service is complete. Personal service, service by U.S. Postal
Express Mail or service by commercial courier or express delivery service
is complete upon delivery. Service by mail is complete upon mailing.
Service by facsimile is complete upon confirmation of transmission by
delivery of a manually signed receipt.

§211 Filing of Papers With the Commissioner: Procedures

(a) When to file. All papers required to be served by a party upon any
person shall be filed with the Commissioner at the time of service or
promptly thereafter. Papers required to be filed with the Commissioner must
be received within the time limit, if any, for such filings.

(b) Where to file. Filing of papers with the Commissioner shall be made by
filing the original papers with the Commissioner and one (1) copy with the
hearing officer.

(c) To whom to direct the filing. All motions, objections, applications or
other filings made during a proceeding shall be directed to and decided by
the hearing officer.

(d) Certificate of Service. Papers filed with the Commissioner and the
hearing officer shall be accompanied by a certificate stating the name of
the person or persons served, the date of service, the method of service
and the mailing address or facsimile telephone number to which service was
made, if not made in person.

§212 Filing of Papers: Form

(a) Specifications. Papers filed in connection with any administrative
proceeding shall:

(1) Be on one grade of unglazed white paper measuring 8-1/2 x 11 inches,
except that, to the extent that the reduction of larger documents would
render them illegible, such documents may be filed on larger paper;

(2) Be typewritten or printed in either ten or twelve-point typeface or
otherwise reproduced by a process that produces permanent and plainly
legible copies;

(3) Include at the head of the paper, or on a title page, the title of the
proceeding, the names of the parties,
the subject of the particular paper or pleading, and the file number
assigned to the proceeding;

(4) Be paginated with left hand margins at least one inch wide, and other
margins of at least one inch;

(5) Be double-spaced, with single-spaced footnotes and single-spaced
indented quotations; and

(6) Be stapled, clipped or otherwise fastened in the upper left corner.

(b) Signature required. All papers must be dated and signed as provided in
§213.

(c) Suitability for recordkeeping. Documents which, in the opinion of the
Commissioner, are not suitable for computer scanning or microfilming may be
rejected.

(d) Form of briefs. All briefs containing more than ten pages shall include
a table of contents, an alphabetized table of cases, a table of statutes,
and a table of other authorities cited, with references to the pages of the
brief wherein they are cited.

(e) Scandalous or impertinent matter. Any scandalous or impertinent matter
contained in any brief or pleading or in connection with any oral
presentation in a proceeding may be stricken on order of the hearing
officer.

§213 Filing of Papers: Signature Requirement and Effect

(a) General requirements. Every filing of a party represented by counsel
shall be signed by Delaware Counsel of record in his or her name and shall
state that counsel's business address and telephone number. A party who
acts as his or her own counsel shall sign his or her individual name and
state his or her address and telephone number on every filing.

(b) Effect of signature. (1) The signature of a counsel or party shall
constitute a certification that:

(i) the person signing the filing has read the filing;

(ii) to the best of his or her knowledge, information and belief, formed
after reasonable inquiry, the filing is well grounded in fact and is
warranted by existing law or a good faith argument for the extension,
modification, or reversal of existing law; and

(iii) the filing is not made for any improper purpose, such as to harass or
to cause unnecessary delay or needless increase in the cost of
adjudication.

(2) If a filing is not signed, the hearing officer shall strike the filing,
unless it is signed promptly after the omission is called to the attention
of the person making the filing.

§214 Computation of Time

(a) Computation. In computing any period of time prescribed in or allowed
by these Rules of Practice or by order of the hearing officer, the day of
the act, event or
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default from which the designated period of time begins to run shall not be
included. The last day of the period so computed shall be included unless
it is a Saturday, Sunday or State legal holiday (as defined in §202), in
which event the period runs until the end of the next day that is not a
Saturday, Sunday or State legal holiday. Intermediate Saturdays, Sundays
and State legal holidays shall be excluded from the computation when the
period of time prescribed or allowed is seven days or less, not including
any additional time allowed for service by mail in paragraph (b) of this
section. If on the day a filing is to be made, weather or other conditions
have caused the designated filing location to close, the filing deadline
shall be extended to the end of the next day that is neither a Saturday,
Sunday nor State legal holiday.

(b) Additional time for service by mail. If service is made by mail, three
days shall be added to the prescribed period for response.

Pleadings and Prehearing Practice

§220 Complaints: General

If the Securities Division believes that any person is violating or has
violated any provision of the Delaware Securities Act or any rule or
regulation thereunder, it may issue a complaint as set forth in Rule 221.
The complaint shall be served on each party as provided in Rule 210 and
filed at the time of service with the Securities Commissioner pursuant to
Rule 211. The service and filing of the complaint constitutes the
commencement of the administrative proceeding.

§221 Complaints: Form and Content

Each complaint shall be in writing and signed by a Deputy Attorney General
. The complaint shall specify in reasonable detail the conduct alleged to
constitute the violative activity and the statutory provision, rule or
regulation the respondent is alleged to be violating or to have violated.
If the complaint consists of several causes of action, each cause shall be
stated separately.

§222 Complaints: Amendment and Withdrawal

(a) At any time prior to the filing of a responsive pleading or the
commencement of a hearing (whichever is earlier), the Securities Division
may amend a complaint to include new matters of fact or law. After the
filing of a responsive pleading or the commencement of a hearing, upon
motion by the Securities Division, the hearing officer may permit amendment
of a complaint to include new matters of fact or law.

(b) At any time prior to the filing of a responsive pleading or the
commencement of a hearing (whichever is earlier), the Securities Division
may withdraw its complaint. Such withdrawal shall be without prejudice to
refiling, and the Securities Division shall be permitted to file a
complaint based on allegations concerning the same facts and circumstances
that are set forth in the withdrawn complaint. The Securities Division may
withdraw its complaint after the filing of a responsive pleading or
commencement of a hearing; however, upon motion of the respondent, the
hearing officer, after considering the facts and circumstances of the
withdrawal, shall determine whether the withdrawal shall be with prejudice.

§223 Order Delegating Authority to Hearing Officer

In each case in which a complaint is filed pursuant to Rule 211, the
Securities Commissioner shall promptly file and serve on the parties an
order delegating authority to an administrative hearing officer pursuant to
Rule 103.

§224 Answers to Complaints

(a) Form, Service, Notice. Each respondent named in a complaint shall
answer and serve an answer to the complaint on the Securities Division and
all other parties within 25 days after service of the complaint on such
respondent pursuant to Rule 210 and at the time of service file such answer
with the hearing officer pursuant to Rules 211, 212 and 213. The hearing
officer may extend such period for good cause.

(b) Content, Affirmative Defenses. Unless otherwise ordered by the hearing
officer, an answer shall specifically admit, deny, or state that the
respondent does not have and is unable to obtain sufficient information to
admit or deny each allegation in the complaint. When a respondent intends
to deny only part of an allegation, the respondent shall specify so much of
it as is admitted and deny only the remainder. A statement of lack of
information shall be deemed a denial. Any allegation not denied shall be
deemed admitted. Any affirmative defense shall be asserted in the answer.

(c) Amendments to Answer. Upon motion by a respondent, the hearing officer
may permit an answer to be amended.

(d) Extension of Time to Answer Amended Complaint. If a complaint is
amended pursuant to Rule 222, the time for filing an answer or amended
answer shall be extended to 10 days after service of the amended complaint.
If any respondent has already filed an answer, such respondent shall have
15 days after service of the amended complaint, unless otherwise ordered by
the hearing officer, within which to file an amended answer.

(e) Failure to Answer, Default. If the respondent does not file an answer
within the time required, the hearing officer shall order the Securities
Division to send a second notice to such respondent requiring an answer
within 10 days after service of the second notice, or within such longer
period as the hearing officer in his or her discretion may order. The
second notice shall state that
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failure of the respondent to reply within the period specified shall allow
the hearing officer, in the exercise of his or her discretion, to:

(1) treat as admitted by the respondent the allegations in the complaint;
and

(2) enter a default decision against the respondent pursuant to Rule
232(a). If no answer is filed with the hearing officer within the time
required by the second notice, the allegations of the complaint may be
considered admitted by such respondent and a default decision may be issued
by the hearing officer. A respondent may, for good cause shown, move to set
aside a default pursuant to Rule 232(b).

§225 Request for Hearing

(a) Securities Division Request for Hearing. With the filing of its
complaint or at any time later, the Securities Division may request a
hearing. The Securities Division may request that the hearing be convened
within a specified time after the filing of the complaint, but in no event
shall that hearing be required to be held earlier than 30 days after
service and filing of the complaint other than in summary proceedings under
Sections 7308(c), 7309(c), 7316(c) or 7325(c) of the Act.

(b) Respondent Request for Hearing. With the filing of respondent's answer
such respondent may request a hearing. If a respondent requests a hearing,
a hearing shall be granted. A respondent who fails to request a hearing
with the filing of his or her answer waives the right to a hearing unless
the hearing officer grants, for good cause shown, a later filed motion by
such respondent requesting a hearing.

(c) Hearing Officer Order Requiring Hearing. Any complaint may be set down
for a hearing upon order of the hearing officer. The hearing officer may
set a complaint for hearing in the absence of a request for hearing by any
party.

(d) Notice of Hearing. The hearing officer shall issue a notice stating the
date, time and place of the hearing, and shall serve such notice on the
parties at least 28 days before the hearing, unless (1) in the discretion
of the hearing officer, he or she determines that extraordinary
circumstances require a shorter notice period; or (2) the parties waive the
notice period.

§226 Prehearing Conferences

(a) Purpose of conferences. The purpose of prehearing conferences include,
but are not limited to:

(1) Expediting the disposition of the proceeding;

(2) Establishing early and continuing control of the proceeding by the
hearing officer; and

(3) Improving the quality of the hearing through more thorough preparation.

(b) Procedure. On his or her own motion or at the
request of a party, the hearing officer may, in his or her discretion,
direct counsel or any party to meet for an initial, final or other
prehearing conference. Such conferences may be held with or without the
hearing officer present as the hearing officer deems appropriate. Where
such a conference is held outside the presence of the hearing officer, the
hearing officer shall be advised promptly by the parties of any agreements
reached. Such conferences also may be held with one or more persons
participating by telephone or other remote means.

(c) Subjects to be discussed. At a prehearing conference consideration may
be given and action taken with respect to any and all of the following:

(1) Simplification and clarification of the issues;

(2) Exchange of witness and exhibit lists and copies of exhibits;

(3) Stipulations, admissions of fact, and stipulations concerning the
contents, authenticity or admissibility into evidence of documents;

(4) Matters of which official notice may be taken;

(5) The schedule for exchanging prehearing motions or briefs, if any;

(6) The method of service for papers;

(7) Summary disposition of any or all issues;

(8) Settlement of any or all issues;

(9) Determination of hearing dates;

(10) Amendments to the complaint or answers thereto;

(11) Disclosure of evidence by the parties as set forth in Rule 228 and
production of witness statements as set forth in Rule 229; and

(12) Such other matters as may aid in the orderly and expeditious
disposition of the proceeding.

(d) Prehearing orders. At or following the conclusion of any conference
held pursuant to this section, the hearing officer shall enter a ruling or
order which recites the agreements reached and any procedural
determinations made by the hearing officer.

(e) Failure to appear: default. Any person who is named as a respondent in
a complaint and who fails to appear, in person or through a representative,
at a prehearing conference of which he or she has been duly notified may be
deemed in default pursuant to Rule 232(a). A party may make a motion to set
aside a default pursuant to Rule 232(b).

§227 Prehearing Submissions

(a) Submissions generally. The hearing officer, on his or her own motion,
or at the request of a party or other participant, may order any party,
including the Securities Division, to furnish such information as deemed
appropriate, including any or all of the following:

(1) An outline or narrative summary of its case or
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defense;

(2) The legal theories upon which it will rely;

(3) Copies and a list of documents that it intends to introduce at the
hearing; and

(4) A list of witnesses who will testify on its behalf, including the
witnesses' names, occupations, addresses and a brief summary of their
expected testimony.

(b) Expert witnesses. Each party who intends to call an expert witness
shall submit, in addition to the information required by paragraph (a)(4)
of this section, a statement of the expert's qualifications, a listing of
other proceedings in which the expert has given expert testimony, and a
list of publications authored or co-authored by the expert.

§228 Disclosure of Evidence by the Parties

(a) Disclosure of Evidence by the Securities Division. Upon request of a
respondent, the Securities Division shall disclose to respondent and make
available for inspection, copying or photographing:

(1) Any relevant written or recorded statements made by the respondent or
co-respondent, or copies thereof, within the possession, custody or control
of the Securities Division, the existence of which is known, or by the
exercise of due diligence may become known, to the Securities Division; and
that portion of any written record containing the substance of any relevant
oral statement made by the respondent in response to interrogation by any
person then known to the respondent to be a state agent. Where the
respondent is a corporation, partnership or association, the Securities
Division shall disclose any written or recorded statements of any witness
who (i) was, at the time of that testimony, so situated as an officer or
employee as to have been able legally to bind the respondent in respect to
conduct constituting the offense, or (ii) was, at the time of the offense,
personally involved in the alleged conduct constituting the offense and so
situated as an officer or employee as to have been able legally to bind the
respondent in respect to that alleged conduct in which the witness was
involved.

(2) Documents and tangible objects. Upon request of the respondent the
Securities Division shall permit the respondent to inspect and copy or
photograph books, papers, documents, photographs, tangible objects,
buildings or places, or copies or portions thereof, which are within the
possession, custody or control of the Securities Division, and which are
intended for use by the Securities Division as evidence in chief at the
hearing, or were obtained from or belong to the respondent.

(3) Reports of examinations and tests. Upon request of a respondent, the
Securities Division shall permit respondent to inspect and copy or
photograph any results or reports of physical or mental examinations, and
of scientific tests or experiments, or copies thereof, which are within the
possession, custody or control of the Securities Division, the existence of
which is known, or by the exercise of due diligence may become known, to
the Securities Division, and which are intended for use by the Securities
Division as evidence in chief at the hearing.

(4) Expert witnesses. Upon request of a respondent, the Securities Division
shall disclose to the respondent any evidence which the Division may
present at the hearing, which if presented at a court proceeding would be
submitted pursuant to Rules 702, 703, or 705 of the Delaware Uniform Rules
of Evidence. This disclosure shall be in the form of a written response
that includes the identity of the witness and the substance of the opinions
to be expressed.

(5) Information not subject to disclosure. Except as provided in Rule
228(a)(1), (2) and (3), this rule does not authorize the discovery or
inspection of reports, memoranda, or other internal documents made by the
Securities Division or its agents in connection with the investigation or
prosecution of the case, or of statements by Division witnesses or
prospective Division witnesses.

(b) Disclosure of evidence by the respondent.

(1) Documents and tangible objects. Upon request of the Securities
Division, the respondent shall permit the Division to inspect and copy or
photograph books, papers, documents, photographs, tangible objects, or
copies or portions thereof, which are within the possession, custody or
control of the respondent and which the respondent intends to introduce as
evidence in chief at the hearing.

(2) Reports of examination and tests. The respondent, on request of the
Securities Division, shall permit the Division to inspect and copy or
photograph any results or reports of physical or mental examinations and of
scientific tests or experiments made in connection with the particular
case, or copies thereof, within the possession or control of the
respondent, which the respondent intends to introduce as evidence in chief
at the hearing or which were prepared by a witness whom the respondent
intends to call at the hearing when the results or reports relate to that
witness' testimony.

(3) Expert witnesses. The respondent, on request of the Securities
Division, shall disclose to the Division any evidence the respondent may
present at the hearing, which if presented at a court proceeding would be
submitted pursuant to Rules 702, 703 or 705 of the Delaware Uniform Rules
of Evidence. This disclosure shall be in the form of a written response
that includes the identity of the witnesses and the substance of the
opinions to be expressed.

(4) Information not subject to disclosure. Except as to scientific or
medical reports, this subdivision does not authorize the discovery or
inspection of reports,
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memoranda, or other internal defense documents made by the respondent or
the respondent's attorneys or agents in connection with the investigation
or defense of the case, or of statements made by the respondent, or by
Division or respondent witnesses, or by prospective Division or respondent
witnesses, to the respondent, the respondent's agents or attorneys.

(c) Procedure. Any party may serve a request for discovery after filing of
respondent's answer or, if no answer has been filed, after expiration of
the period for filing an answer. The request shall set forth the items
sought with reasonable particularity and shall specify a reasonable time,
place and manner of compliance with the request. The party upon whom the
request is served shall serve a response within 20 days after service of
the request or at such other time as ordered by the hearing officer. The
response shall comply with the request or specify any objection to it. The
response may specify a reasonable alternative time, place and manner of
compliance.

(d) Continuing duty to disclose. If, prior to or during an administrative
hearing, a party discovers additional evidence or material previously
requested or ordered, which is subject to discovery or inspection under
this rule, such party shall promptly notify the other party or that other
party's attorney or the hearing officer of the existence of the additional
evidence or material.

(e) Regulation of disclosure.

(1) Protective and modifying orders. Upon a sufficient showing the hearing
officer may at any time order that the disclosure or inspection be denied,
restricted or deferred, or make such other order as is appropriate. Upon
motion by a party, the hearing officer may permit the party to make such
showing, in whole or in part, in the form of a written statement to be
inspected by the hearing officer alone. If the hearing officer enters an
order granting relief following such an ex parte showing, the entire text
of the party's statement shall be sealed and preserved in the records of
the hearing officer to be made available to the Chancery Court in the event
of an appeal.

(2) Failure to comply with a request. If at any time during the course of
the proceedings it is brought to the attention of the hearing officer that
a party has failed to comply with this rule, the hearing officer may order
such party to permit the disclosure or inspection, grant a continuance, or
prohibit the party from introducing evidence not disclosed, or he may enter
such other order as he deems just under the circumstances. The hearing
officer may specify the time, place and manner of making the disclosure and
inspection and may prescribe such terms and conditions as are just.

§229 Production of Witness Statements

Any party may file a motion requesting that any other party produce for
inspection and copying a statement in its
possession, custody or control of any person called or to be called as a
witness that pertain, or is expected to pertain, to his or her direct
testimony, including statements that would be required to be produced
pursuant to Rule 26.2 of the Delaware Superior Court Criminal Rules. The
production shall be made at a time and place fixed by the hearing officer
and shall be made available to all parties.

§230 Motions

(a) Generally. Unless made during a hearing or conference, a motion shall
be in writing, shall state with particularity the grounds therefor, shall
set forth the relief or order sought, and shall be accompanied by a written
brief of the points and authorities relied upon. All written motions shall
be served in accordance with Rule 210, be filed in accordance with Rule
211, meet the requirements of Rule 212, and be signed in accordance with
Rule 213. The hearing officer may order that an oral motion be submitted in
writing. Unless otherwise ordered by the hearing officer, if a motion is
properly made, the proceeding before the hearing officer shall continue
pending the determination of the motion. No oral argument shall be heard on
any motion unless the hearing officer otherwise directs.

(b) Opposing and reply briefs. Briefs in opposition to a motion shall be
filed within ten days after service of the motion. Reply briefs shall be
filed within three days after service of the opposition.

(c) Length limitation. A brief in support of or opposition to a motion
shall not exceed ten pages, exclusive of pages containing any table of
contents, table of authorities, and/or addendum. Requests for leave to file
briefs in excess of ten pages are disfavored.

§231 Motion for Summary Disposition

(a) After a respondent's answer has been filed and documents have been made
available to that respondent for inspection and copying pursuant to Rule
228, the respondent or the Division may make a motion for summary
disposition of any or all allegations of the complaint with respect to that
respondent. Any motion for summary disposition shall be filed within 30
days after the filing of the respondent's answer or at such other time as
ordered by the hearing officer. Notwithstanding the provisions of Rule 230,
any opposition or response to a motion for summary disposition shall be
filed within 14 days after service of the motion. Reply briefs shall be
filed within five days after service of the opposition or response.

(b) A motion for summary disposition pursuant to paragraph (a) shall be
accompanied by the following: a statement of undisputed facts; a supporting
memorandum of points and authorities; and affidavits or declarations
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that set forth such facts as would be admissible at the hearing and show
affirmatively that the affiant is competent to testify to the matters
therein. The motion for summary disposition, supporting memorandum of
points and authorities, and any declarations, affidavits or attachments
shall not exceed 35 pages in length.

(c) The hearing officer shall promptly grant or deny the motion for summary
disposition or shall defer decision on the motion. The hearing officer may
grant the motion for summary disposition if there is no genuine issue with
regard to any material fact and the party making the motion is entitled to
a summary disposition as a matter of law. If it appears that a party, for
good cause shown, cannot present by affidavit prior to hearing facts
essential to justify opposition to the motion, the hearing officer shall
deny or defer the motion.

§232 Default; Motion to Set Aside Default

(a) A party to a proceeding may be deemed to be in default and the hearing
officer may determine the proceeding against that party upon consideration
of the record, including the complaint, the allegations of which may be
deemed to be true, if that party fails:

(1) To appear, in person or through a representative, at a hearing or
conference of which that party has been notified;

(2) To answer, to respond to a dispositive motion within the time provided,
or otherwise to defend the proceeding; or

(3) To cure a deficient filing within the time specified by the hearing
officer.

(b) A motion to set aside a default shall be made within a reasonable time,
state the reasons for the failure to appear or defend, and specify the
nature of the proposed defense in the proceeding. In order to prevent
injustice and on such conditions as may be appropriate, the hearing officer
may for good cause shown set aside a default.

Administrative Hearings

§240 Hearings

Hearings for the purpose of taking evidence shall be held upon order of the
hearing officer. All hearings shall be conducted in a fair, impartial,
expeditious and orderly manner.

§241 Hearings to be public

All hearings, except hearings on ex parte applications for a summary order
under Sections 7308(c), 7309(c), 7316(c) or 7325(c) of the Act, shall be
public unless otherwise ordered by the hearing officer on his or her own
motion or the motion of a party. No hearing shall be nonpublic where all
respondents request that the hearing be made public.

§242 Continuance of Hearing

Any motion for a continuance of the hearing date shall be filed as far in
advance of the hearing date as practicable. Motions should state with
specificity the reason for the continuance request.

§243 Procedure

(a) Unless otherwise ordered by the hearing officer, no later than three
days prior to the hearing each party shall submit to all other parties and
to the hearing officer copies of all documentary evidence and the names of
the witnesses each party intends to present in its case-in-chief at the
hearing.

(b) In the administrative hearing, each party is entitled to present its
case or defense by oral or documentary evidence, to submit rebuttal
evidence, and to conduct such cross-examination as, in the discretion of
the hearing officer, may be required for a full and true disclosure of the
facts.

§244 Testimony

Witnesses shall testify under oath or affirmation. The oath or affirmation
may be administered by a Deputy Attorney General, notary public or any
other officer authorized to administer oaths and affirmations under
Delaware law.

§245 Evidence: Admissibility

The hearing officer shall receive relevant evidence and may exclude all
evidence that is irrelevant, immaterial or unduly repetitious.

§246 Evidence: Objections and Offers of Proof

(a) Objections. Objections to the admission or exclusion of evidence must
be made on the record and shall be in short form, stating the grounds
relied upon. Exceptions to any ruling thereon by the hearing officer need
not be noted at the time of the ruling. Such exceptions will be deemed
waived on appeal to the Court of Chancery, however, unless raised in a
proposed finding or conclusion filed pursuant to Rule 248.

(b) Offers of proof. Whenever evidence is excluded from the record, the
party offering such evidence may make an offer of proof, which shall be
included in the record. Excluded material shall be retained pursuant to
Rule 249.

§247 Evidence: Reference to Delaware Uniform Rules of Evidence

The hearing officer may make reference to and be guided by the Delaware
Uniform Rules of Evidence in receiving relevant evidence under Rule 245 and
ruling on
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objections under Rule 246. Notwithstanding those rules, the hearing officer
may admit any evidence that reasonable and prudent individuals would
commonly accept in the conduct of their affairs, and give probative effect
to that evidence. Evidence may not be excluded solely on the ground that it
is hearsay.

§248 Proposed Findings of Fact, Conclusions of Law, and Post-Hearing Briefs

(a) At the discretion of the hearing officer, the parties may be ordered to
file proposed findings of fact and conclusions of law, or post-hearing
briefs, or both. The hearing officer may order that such proposed findings
and conclusions be filed together with, or as part of, post-hearing briefs.

(b) Proposed findings of fact or other statements of fact in briefs shall
be supported by specific references to the record.

(c) In any case in which the hearing officer has ordered the filing of
proposed findings of fact and conclusions of law, or post-hearing briefs,
the hearing officer shall, after consultation with the parties, prescribe
the period within which proposed findings of fact and conclusions of law or
post-hearing briefs are to be filed. Such period shall be reasonable under
all the circumstances but the total period allowed for the filing of
post-hearing submissions shall not exceed 60 days after the conclusion of
the hearing unless the hearing officer, for good cause shown, permits a
different period and sets forth in an order the reasons why a longer period
is necessary.

(d) Unless the hearing officer orders otherwise, each post-hearing
submission shall not exceed 25 pages, exclusive of cover sheets, tables of
contents and tables of authorities.

§249 Record of Hearings

(a) Contents of the record. The record shall consist of:

(1) The complaint and answers thereto; the notice of hearing; and any
amendments to those documents;

(2) Each application, motion, submission or other paper, and any
amendments, motions, objections, and exceptions to or regarding them;

(3) Each stipulation, transcript of testimony and document or other item
admitted into evidence;

(4) With respect to a request to disqualify a hearing officer or to allow
the hearing officer's withdrawal under Rule 204, each affidavit or
transcript of testimony taken and the decision made in connection with the
request;

(5) All proposed findings and conclusions;

(6) Each written order issued by the hearing
officer; and

(7) Any other document or item accepted into the record by the hearing
officer.

(b) Retention of documents not admitted. Any document offered in evidence
but excluded, and any document marked for identification but not offered as
an exhibit, shall not be considered a part of the record but shall be
retained until the later of the date upon which an order ending the
proceeding becomes final, or the conclusion of any judicial review of the
hearing officer's order.

(c) Substitution of copies. A true copy of a document may be substituted
for any document in the record or any document retained pursuant to
paragraph (b) of this section.

§250 Supplementation of Record

Upon motion filed within ten days of the conclusion of the hearing, any
party may seek leave from the hearing officer to supplement the record with
additional relevant material evidence. Where the party shows to the
satisfaction of the hearing officer that there were reasonable grounds for
failure to adduce the evidence in the hearing, the hearing officer may
allow the evidence to be heard in such manner and upon such conditions as
the hearing officer considers proper.

§251 Decision of Administrative Hearing Officer

In any administrative proceeding in which a hearing is held, the hearing
officer shall issue a decision. The decision shall include: (i) findings of
fact and conclusions of law, and the reasons or basis therefor, as to all
material issues of fact, law or discretion presented on the record; (ii)
the appropriate order, sanction or relief, or denial thereof; (iii) a
statement that the decision constitutes a final order for purposes of
judicial review under Section 7324 of the Act; and (iv) the date on which
sanctions, if any, take effect.

§252 Failure to Appear at Hearing: Default

Any respondent who fails to appear at a hearing of which he or she has been
duly notified may be deemed to be in default pursuant to Rule 232(a). A
party may make a motion to set aside a default pursuant to Rule 232(b).

§253 Contemptuous Conduct

If a party, counsel to a party or witness engages in conduct in violation
of an order of the hearing officer, or other contemptuous conduct during an
administrative proceeding, the hearing officer may impose sanctions
therefor, including the issuance of an order: (i) excluding the party
and/or his or her counsel from any further participation in the proceeding;
(ii) striking pleadings or evidence from the record; (iii) providing that
certain facts
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shall be taken to be established for purposes of the proceeding; or (iv)
providing for such other relief as is just and equitable under the
circumstances.

Practice and Procedure Regarding Summary Orders Issued Pursuant to Sections
7308(c), 7309(c), 7316(c) and 7325(c) of the Act

§260 Basis for Issuance of Summary Order Postponing or Suspending the
Effectiveness of a Registration Statement Pursuant to Section 7308(c)

The Securities Division may make application for, and an Administrative
Hearing Officer may issue, a summary order postponing or suspending the
effectiveness of any registration statement, if such an order is in the
public interest and any of the following criteria are met:

(a) The registration statement as of its effective date or as of any
earlier date in the case of an order denying effectiveness, or any
amendment or report is incomplete in any material respect or contains any
statement which was, in the light of the circumstances under which it was
made, false or misleading with respect to any material fact;

(b) Any provision of the Act or any rule, order, or condition lawfully
imposed under the Act has been violated, in connection with the offering,
by (i) the person filing the registration statement, (ii) the issuer, any
partner, officer, or director of the issuer, any person occupying a similar
status or performing similar functions, or any person directly or
indirectly controlling or controlled by the issuer, but only if the person
filing the registration statement is directly or indirectly controlled by
or acting for the issuer, or (iii) any underwriter;

(c) The security registered or sought to be registered is the subject of an
administrative stop order or similar order or permanent or temporary
injunction of any court of competent jurisdiction entered under any federal
or state act applicable to the offering;

(d) The issuer's enterprise or method of business includes or would include
activities which are illegal where performed;

(e) The offering has worked or tended to work a fraud upon purchasers or
would so operate;

(f) The offering has been or would be made with unreasonable amounts of
underwriters' and sellers' discounts, commissions, or other compensation,
or promoters' profits or participation, or unreasonable amounts or kinds of
options;

(g) The applicant or registrant has failed to pay the proper filing fee;
but the hearing officer shall vacate any such order when the deficiency has
been corrected;

(h) When a security is sought to be registered by coordination, there has
been a failure to comply with the undertaking required by Section
7305(b)(4) of the Act.

§261 Basis for Issuance of Summary Order Denying or Revoking Exemption
Pursuant to Section 7309(c)

The Securities Division may make application for, and an Administrative
Hearing Officer may issue, a summary order denying or revoking any
exemption claimed under Sections 7309(a)(9), (a)(11), or (b)(1)-(13) of the
Act, whenever it appears that such exemption is inapplicable, either
generally or with respect to a specific security or transaction.

§262 Basis for Issuance of Summary Order Postponing or Suspending the
Registration of a Broker-Dealer, Broker-Dealer Agent, Investment Adviser or
Investment Adviser Representative Pursuant to Section 7316(c)

The Securities Division may make application for, and an Administrative
Hearing Officer may issue, a summary order postponing or suspending the
registration of a broker-dealer, broker-dealer agent, investment adviser or
investment adviser representative if such an order is in the public
interest and the applicant or registrant or, in the case of a broker-dealer
or investment adviser, any partner, officer, director, or any person
occupying a similar status or performing similar functions, or any person
directly or indirectly controlling the broker-dealer or investment adviser:

(a) Has filed an application for registration which as of its effective
date, or as of any date after filing in the case of an order denying
effectiveness, was incomplete in any material respect or contained any
statement which was, in light of the circumstances under which it was made,
false or misleading with respect to any material fact; or

(b) Has wilfully violated or wilfully failed to comply with any provision
of the Act; or

(c) Has been convicted of a felony, infamous crime, or other crime
involving moral turpitude; or

(d) Is permanently or temporarily enjoined by any court of competent
jurisdiction from engaging in or continuing any conduct or practice
involving any aspect of the securities business; or

(e) Is the subject of a cease and desist order or of an order denying,
suspending, or revoking registration as a broker-dealer, broker-dealer
agent, investment adviser or investment adviser representative; or

(f) Is the subject of an order entered within the past ten years by the
securities administrator of any other state or by the Securities and
Exchange Commission either ordering the person to cease and desist from
engaging in or continuing any conduct or practice involving any aspect of
the securities business, or suspending, denying or revoking registration as
a broker-dealer, broker-dealer agent, investment adviser or investment
adviser
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representative, or the substantial equivalent of those terms as defined in
the Act and these rules; or is suspended or expelled from a national
securities exchange or national securities association registered under the
Securities Exchange Act of 1934 [15 U.S.C. §78a et seq.] either by action
of a national securities exchange or national securities association, the
effect of which action has not been stayed by administrative or judicial
order or is the subject of a United States post office fraud order; or

(g) Has engaged in dishonest or unethical practices within or outside this
State; or

(h) Is insolvent, either in the sense that his liabilities exceed his
assets or in the sense that he cannot meet his obligations as they mature;
or

(i) Is not qualified on the basis of such factors as training, experience,
and knowledge of the securities business; or

(j) Has failed reasonably to supervise (1) his agents or employees, if he
is a broker-dealer or broker-dealer agent with supervisory
responsibilities; or (2) his adviser representatives or employees if he is
an investment adviser or investment adviser representative with supervisory
responsibilities, and such failure may be inferred from an agent's,
investment adviser representative's, or employee's violations;

(k) Has failed to pay the proper filing fee, but the hearing officer shall
vacate any denial or suspension order when the deficiency has been
corrected; or

(l) Has violated or failed to comply with any lawful order issued by the
Commissioner or by an Administrative Hearing Officer acting pursuant to
delegated authority under Rule 103; or

(m) Has within the past ten years been a partner, officer, director,
controlling person or any person occupying a similar status or performing
similar functions in a broker-dealer or investment adviser whose
registration in this State or any state, or with the SEC, has been revoked
for disciplinary reasons, or whose membership in a national securities
exchange or national securities association has been terminated for
disciplinary reasons.

§263 Basis for Issuance of Summary Cease and Desist Order

Whenever it appears that a person has violated the Delaware Securities Act
by failing to register or engaging in fraud or other prohibited conduct, an
Administrative Hearing Officer may summarily issue a cease and desist order
against that person under Section 7325(c) of the Act.

§264 Application for Issuance of Summary Order

(a) Procedure. A request for entry of a summary order shall be made by
application filed by the Division.
The application shall set forth the statutory provision or rule that each
respondent is alleged to have violated; the temporary relief sought against
each respondent; and whether the relief is sought ex parte.

(b) Accompanying documents. The application shall be accompanied by a
declaration of facts signed by a person with knowledge of the facts
contained therein, a memorandum of points and authorities, a proposed order
imposing the temporary relief sought, and, unless relief is sought ex
parte, a proposed notice of hearing and order to show cause whether the
temporary relief should be imposed. If a proceeding for a permanent order
has not already been commenced, a complaint instituting proceedings to
determine whether a permanent order should be imposed shall also be filed
with the application or as soon thereafter as practicable.

(c) Record of proceedings. A record from which a verbatim transcript can be
prepared shall be made of all hearings, including ex parte presentations
made by the Division.

§265 Procedure After Issuance of Order

(a) Notice. Any person who is the subject of a summary order shall promptly
be given notice of that order and of the reasons therefor. Notice shall be
given by means reasonably calculated to give actual notice of issuance of
the order, including telephone notification and service of the order
pursuant to Rule 210. Such notice shall include notification that the
subject of the order may request a hearing and that if such a request is
made in writing the hearing shall be scheduled within 15 days from the date
the written request is received.

(b) Request for hearing. Any person who is the subject of a summary order
may request a hearing before an administrative hearing officer on an
application to set aside, limit or suspend the summary order. That hearing
shall be scheduled within 15 days from the date the written request is
received.

(c) Procedure at hearing. The procedure at a hearing on a summary order
shall be determined by the hearing officer, with the understanding that
each party shall be entitled to be heard in person or through counsel. The
hearing officer shall rule on the admissibility of evidence and other
matters, including, but not limited to whether oral testimony will be
heard; the time allowed each party for the submission of evidence or
argument; and whether post-hearing submission of briefs and/or proposed
findings of fact and conclusions of law will be permitted and if so, the
procedures for submissions.

(d) Decision of Hearing Officer. After hearing evidence pursuant to
subsection (c) of this Rule, the hearing officer shall issue a decision on
respondent's application to set aside, limit or suspend the order, and may
grant or deny that application; modify or vacate the
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order; or extend it until final determination. If no hearing has been
requested and none has been ordered by the hearing officer, the summary
order shall remain in effect until it is modified or vacated by the hearing
officer.

(e) Duration. Unless set aside, limited or suspended, either by the hearing
officer or a court of competent jurisdiction, a summary order shall remain
in effect until the completion of the proceedings on whether a permanent
order shall be entered or, if no such proceedings occur, until otherwise
modified or vacated by the hearing officer.

§266 Violation of Cease and Desist Orders

If any person who is the subject of a cease and desist order, or any agent
or employee of such person, subsequent to the issuance of the order engages
in the prohibited conduct, the Commissioner may certify the facts and apply
for a contempt order to any Judge of the Superior Court, who shall upon
such application hear the evidence as to the acts complained of. If the
evidence warrants, the Judge shall punish such person, in the same manner
and to the same extent as for a contempt committed before the Superior
Court, or shall commit such person upon the same conditions as if the doing
of the forbidden act had occurred with reference to the process of, or in
the presence of, the Superior Court.

Appeal to the Court of Chancery

§270 Right to Judicial Review

Any person aggrieved by an order of the administrative hearing officer may
obtain a review of the order in the Court of Chancery. Upon review, the
Court of Chancery has the authority to determine questions of law de novo.
The factual findings of the hearing officer, if supported by material and
substantial evidence, shall be conclusive on the Court of Chancery. The
filing of a complaint seeking review does not operate as a stay of the
hearing officer's order unless specifically ordered by the Court.

§271 Procedure

A party seeking review must file a written complaint with the Court of
Chancery within 60 days of entry of the hearing officer's order. The
complaint shall be forthwith served on the hearing officer and the other
parties to the administrative proceeding. The party seeking review must pay
the costs of transcribing the record. Upon completion of the record
transcription, the hearing officer shall certify and file with the Court of
Chancery a copy of the record transcription; all evidence upon which the
order was entered; and any documents or other proffered evidence retained
pursuant to Rule 249(b) relevant to the complaint (together, the
"Administrative Record"). If the
Administrative Record is not filed with the Chancery Court within 20 days
of the filing of the complaint, the hearing officer shall notify the Court
and receive additional time in which to file and certify the record. A
continued failure by the party seeking review to pay the costs of
transcription shall result in dismissal of the complaint without any need
for the administrative hearing officer to file the record in Court.

§272 Application to the Court for Leave to Adduce Additional Material
Evidence

If, within 20 days of the filing of the record with the Court, either party
applies to the Court for leave to adduce additional material evidence, and
shows to the satisfaction of the Court that there were reasonable grounds
for failure to adduce the evidence in the administrative hearing, the Court
may order the additional evidence to be taken before the administrative
hearing officer and to be adduced upon the hearing in such manner and upon
such conditions as the Court considers proper.

Part C. Investigations

§300 Scope of Rules Regarding Investigations

The rules of this part apply only to investigations conducted by the
Securities Division. They do not apply to administrative proceedings under
the Act.

§301 Nature and Purpose of Investigations

(a) The Commissioner may in his or her discretion make such public or
private investigations within or outside the State as he or she deems
necessary to determine whether any person has violated, is violating, or is
about to violate any provision of the Act or the rules or regulations
thereunder or otherwise to aid in the enforcement of the Act. Where, from
complaints received from members of the public, communications from Federal
or State agencies, examination of filings made with the Division, or
otherwise, it appears that there may be violations of the Securities Act,
or the rules or regulations thereunder, a preliminary investigation is
generally made. Unless otherwise ordered by the Division, all
investigations are non-public and the reports thereon are for Division use
only.

(b) After investigation or otherwise, the Division may in its discretion
take one or more of the following actions: Institution of administrative
proceedings looking to the imposition of remedial sanctions, initiation of
injunctive proceedings in the courts, and, in the case of a willful
violation, criminal prosecution. The Division may also, in an appropriate
case, refer the matter to, or grant requests for access to its files made
by, domestic and foreign governmental authorities or foreign securities
authorities, self-regulatory organizations (such as stock
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exchanges or the National Association of Securities Dealers, Inc.), and
other persons or entities.

§302 Information Obtained in Investigations

(a) Information or documents obtained by the Division in the course of any
investigation or examination, unless made a matter of public record, shall
be deemed non-public.

(b) The Commissioner may in his discretion and upon a showing that such
information is needed, provide nonpublic information in his possession to
any of the following persons if the person receiving such nonpublic
information provides such assurances of confidentiality as the Commissioner
deems appropriate:

(1) A federal, state, local or foreign government or any political
subdivision, authority, agency or instrumentality of such government;

(2) A self-regulatory organization as defined in Section 3(a)(26) of the
Securities Exchange Act of 1934 (15 U.S.C. 78, et seq.) (the "Exchange
Act"), or any similar organization empowered with self-regulatory
responsibilities under the federal securities laws (as defined in Section
3(a)(47) of the Exchange Act), the Commodity Exchange Act (7 U.S.C. 1, et
seq.) or any substantially equivalent foreign statute or regulation;

(3) A foreign financial regulatory authority as defined in Section 3(a)(51)
of the Exchange Act;

(4) The Securities Investor Protection Corporation or any trustee or
counsel for a trustee appointed pursuant to Section 5(b) of the Securities
Investor Protection Act of 1970;

(5) A trustee in bankruptcy;

(6) A bar association, state accountancy board or other federal, state,
local or foreign licensing or oversight authority, or a professional
association or self-regulatory authority to the extent that it performs
similar functions; or

(7) A duly authorized agent, employee or representative of any of the above
persons.

(c) Nothing contained in this section shall affect:

(1) The Commissioner's authority or discretion to provide or refuse to
provide access to, or copies of, nonpublic information in the Division's
possession in accordance with such other authority or discretion as the
Commissioner possesses by statute, rule or regulation; or

(2) The Commissioner's responsibilities under the Freedom of Information
Act, 29 Del. C. §10001 et seq.

§303 Rights of Witnesses

(a) Any person compelled to appear, or who appears by request or permission
of the Division, in person in any investigative proceeding may be
accompanied, represented and advised by counsel, provided, however, that
all witnesses shall be sequestered, and unless permitted in the discretion
of the Division, no
witness or counsel accompanying any such witness shall be permitted to be
present during the examination of any other witness called in such
proceeding.

(b) The right to be accompanied, represented and advised by counsel shall
mean the right of a person testifying to have an attorney present with him
during any investigative proceeding and to have this attorney (1) advise
such person before, during and after the conclusion of such examination,
(2) question such person briefly at the conclusion of the examination to
clarify any of the answers such person has given, and (3) make summary
notes during such examination solely for the use of such person.

§304 Subpoenas

(a) For the purpose of any investigation or proceeding under the Act, the
Commissioner or any officer designated by him may administer oaths and
affirmations, subpoena witnesses, compel their attendance, take evidence,
and require the production of any books, papers, correspondence, memoranda,
agreements, or other documents or records which the Commissioner deems
relevant or material to the inquiry. The Commissioner's authority to
subpoena witnesses and documents outside the State shall exist to the
maximum extent permissible under federal constitutional law.

(b) Subpoenas may be issued to any person and may require that person,
among other things, to:

(1) Testify under oath;

(2) Answer written interrogatories under oath;

(3) Produce documents and tangible things; and

(4) Permit inspection and copying of documents.

(c) Content of subpoena. A subpoena shall:

(1) Describe generally the nature of the investigation;

(2) If the subpoena requires testimony under oath, specify the date, time
and place for the taking of testimony;

(3) If the subpoena requires answers to written interrogatories, contain a
copy of the written interrogatories;

(4) If the subpoena requires the production of tangible things or
documents: (a) describe the things and documents to be produced with
reasonable specificity, and (b) specify a date, time, and place at which
the things and documents are to be produced;

(5) Notify the person to whom the subpoena is directed of the obligation to
supplement responses under Rule 306;

(6) Advise the person to whom the subpoena is directed that the person may
be represented by counsel; and

(7) Identify a member of the Securities Division who may be contacted in
reference to the subpoena.
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(d) Subpoenas to corporations and other entities.

(1) A subpoena directed to a corporation, partnership, or other entity that
requires testimony under oath shall describe with reasonable particularity
the subject matter of the testimony.

(2) An entity that receives a subpoena to answer written interrogatories or
to testify under oath shall designate one or more of its officers, agents,
employees, or other authorized persons familiar with the subject matter
specified in the subpoena to respond to the subpoena on its behalf.

(3) The persons designated by an entity to respond to a subpoena on its
behalf shall answer the interrogatories or testify as to all matters known
or reasonably available to the entity.

(4) A subpoena directed to an entity that requires testimony under oath or
answers to written interrogatories shall advise the entity of its
obligations under this regulation.

(e) Service of subpoena.

(1) A subpoena may be served by personal service or by mail.

(2) The person who serves a subpoena shall complete a certificate of
service attesting to the method and date of service.

(f) Effect of other proceedings. The pendency or beginning of
administrative or judicial proceedings against a person by the Commissioner
does not relieve the person of his obligation to respond to a subpoena
issued under this regulation.

(g) Refusal to testify or produce documents. (1) No person is excused from
attending and testifying or from producing any document or record before
the Commissioner, or in obedience to the subpoena of the Commissioner or
any officer designated by him or in any proceeding instituted by the
Commissioner, on the ground that the testimony or evidence (documentary or
otherwise) required of him may tend to incriminate him or subject him to
penalty or forfeiture; but no individual may be prosecuted or subjected to
any penalty or forfeiture for or on account of any transaction, matter, or
thing concerning which he is compelled, after claiming his privilege
against self-incrimination, to testify or produce evidence (documentary or
otherwise), except that the individual testifying is not exempt from
prosecution and punishment for perjury or contempt committed in testifying.

(2) In case of contumacy by, or refusal to obey a subpoena issued to, any
person registered under Section 7313 of the Act, the Commissioner may
suspend or revoke that registrant's license pursuant to the provisions of
Section 7316 of the Act.

(h) Petition to modify or quash subpoena.

(1) A person served with a subpoena under this
regulation may request that the subpoena be modified or quashed.

(2) A petition to modify or quash a subpoena issued under this regulation
shall be filed with the administrative hearing officer within ten days of
service of the subpoena or by the date specified for compliance with the
subpoena, whichever is earlier. The petition shall set forth good cause why
the subpoena should be modified or quashed.

(i) Application to Court of Chancery upon refusal to obey subpoena. In case
of contumacy by, or refusal to obey a subpoena issued to, any person, the
Court of Chancery, upon application by the Commissioner, may issue to the
person an order requiring him to appear before the Court of Chancery or the
officer designated by him, there to produce documentary evidence if so
ordered or to give evidence touching the matter under investigation or in
question. Failure to obey the order of the Court may be punished by the
court as a contempt of court.

§305 Testimony Under Oath

A witness may be required to provide testimony under oath as part of an
investigation under the Act. A witness who provides testimony under oath
may be accompanied and represented by counsel as provided for in Rule 303.
Testimony shall be recorded by tape recorder, stenographer or other device.
The recording of the testimony shall be maintained in the custody of the
Division.

§306 Production of Things and Documents

(a) Any person may be required to produce things or documents in response
to a subpoena under the Act.

(b) If a person responding to a subpoena for production of things or
documents withholds a record or document on the basis of a privilege, the
person shall state, with respect to each document:

(1) The name and title of the author of the document;

(2) The names and titles of all persons to whom the document was addressed;

(3) The names and titles of all persons to whom copies of the document were
sent;

(4) The date on which the document was written or otherwise produced and
the date on which it was mailed, sent, or delivered to its addressee;

(5) The number of pages in the document;

(6) A brief description of the nature or subject matter of the document;

(7) The basis on which the document is being withheld; and

(8) The paragraph number of the subpoena to which the document is
responsive.

(c) Obligation to supplement responses. If a person has responded to a
subpoena under this regulation and
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later discovers or obtains additional documents or things responsive to the
subpoena, the person shall supplement the response as soon as reasonably
possible.

§307 Written Submissions by Interested Persons

(a) Persons who become involved in an investigation may, on their own
initiative, submit a written statement to the Commissioner setting forth
their interests and position in regard to the subject matter of the
investigation. Upon request, the Division, in its discretion, may advise
such persons of the general nature of the investigation, including the
indicated violations as they pertain to them, and the amount of time that
may be available for preparing and submitting a statement prior to the
presentation of a Division recommendation to the Commissioner for the
commencement of an administrative or injunction proceeding. Submissions by
interested persons should be forwarded to the Securities Commissioner with
a copy to the staff members conducting the investigation and should be
clearly referenced to the specific investigation to which they relate. In
the event a recommendation for the commencement of an enforcement
proceeding is presented by the Division, any submissions by interested
persons will be considered prior to commencement of any proceeding.

(b) Regardless of any voluntary written submission provided under Rule
307(a), the Commissioner may, pursuant to Section 7319(a) of the Act,
require any person to file a statement in writing, under oath or otherwise
as the Commissioner determines, as to any or all of the facts and
circumstances concerning the matter under investigation.

Part D. Securities Registration and Notice Filings

§400 Registration by Coordination

(a) Any security for which a registration statement has been filed under
the Securities Act of 1933 in connection with the same offering may be
registered by coordination.

(b) A person who seeks to register a security by coordination shall file
with the Division the following documents and information:

(1) A completed application Form U-1, Uniform Application to Register
Securities;

(2) An irrevocable consent appointing the Securities Commissioner agent for
service of process, executed by the issuer on Form U-2, Uniform Consent to
Service of Process;

(3) One copy of the registration statement, as amended, filed with the SEC,
which shall include (or which information shall otherwise be provided): a
specification of the amount of the securities offered in Delaware; the
states in which the offering has been or is
being made; and any adverse order, judgment or decree entered in connection
with the offering by any regulatory authority, court or the SEC;

(4) One copy of the prospectus in the latest form on file with the SEC;

(5) The appropriate filing fee as determined under Rule 404; and

(6) Any other document or information requested by the Division.

(c) An application for registration by coordination shall become effective
in Delaware simultaneously with the registration statement filed with the
SEC provided the following conditions have been met:

(1) All documents and information required by (d) above have been filed
with the Division;

(2) No stop order is in effect and no proceeding is pending under Section
7308 of the Act;

(3) The registration statement has been on file with the Division for at
least ten days; and

(4) A statement of the maximum and minimum proposed offering prices and the
maximum underwriting discounts and commissions have been on file for at
least two business days and the offering is made within those limitations.

§401 Registration by Qualification

(a) Any security may be registered by qualification. A person who seeks to
register a security by qualification shall file with the Division the
following documents and information:

(1) A completed application Form U-1, Uniform Application to Register
Securities;

(2) An irrevocable consent appointing the Securities Commissioner agent for
the service of process, executed by the issuer on Form U-2, Uniform Consent
to Service of Process;

(3) One copy of an executed registration statement which complies with SEC
Form S-1, together with all exhibits, which shall include all information
required under Sections 7306(b)(1)-(16) and 7307(b) of the Act.

(4) One copy of the Prospectus which is to be provided to offerees under
Section 7306(d) of the Act;

(5) The appropriate filing fee as determined under Rule 404; and

(6) Any other document or information requested by the Division.

(b) Unless otherwise ordered by the Commissioner, the prospectus which is
sent or given to each person to whom an offer is made shall contain all the
information contained in the registration statement filed with the Division
under subsection (a) of this Rule. The prospectus shall be written in plain
English and presented in a format that is clear and easy to understand,
with
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appropriate headings and subheadings.

(c) An application for registration by qualification shall become effective
in Delaware when so ordered by the Securities Commissioner provided no
order has been issued pursuant to Section 7308 of the Act.

§402 Small Company Offering Registrations

(a) Availability of Small Company Offering Registration ("SCOR").

(1) An issuer may register securities by qualification under Section 7306
of the Act by using the Form U-7 (Small Company Offerings Registration
Form) if the conditions set forth in this regulation and in the
instructions to Form U-7 are satisfied.

(2) In general, a company may do a SCOR offering if it is relying upon an
exemption from registration with the SEC under the Federal Securities Act
of 1933 provided by SEC Regulation A (17 C.F.R. §§230.251-263); Rule 504 of
SEC Regulation D (17 C.F.R. §230.504); or by Section 3(a)(11) of the
Securities Act of 1933 and Rule 147 promulgated thereunder (17 C.F.R.
§230.147).

(3) Under SEC Regulation A, the aggregate amount of the offering cannot
exceed $5,000,000.00. Under Rule 504 of SEC Regulation D, the aggregate
offering amount cannot be more than $1,000,000.00. An offering under
Section 3(a)(11) of the Securities Act of 1933 and SEC Rule 147 may be in
any amount but, among other requirements, all securities must be offered
and sold only to Delaware residents. The company also must be resident and
doing business in Delaware and eighty percent of the net proceeds of the
offering must be used in the operation of the company's business in
Delaware.

(b) Prospectus. A completed Form U-7 that has been declared effective by
the Commissioner shall serve as the prospectus for an offering registered
under this regulation.

(c) Eligibility of Issuer. To be eligible to register securities under this
regulation, the issuer must satisfy the following conditions:

(1) The issuer is a corporation or centrally managed limited liability
company organized under the law of the United States or Canada, or any
state, province, or territory or possession thereof, or the District of
Columbia and have its principal place of business in one of the foregoing;

(2) The issuer is not subject to the reporting requirements of Sections13
or 15(d) of the Securities Exchange Act of 1934, 15 U.S.C. §§78m, 78o(d);

(3) The issuer is not an investment company registered or required to be
registered under the Investment Company Act of 1940, 15 U.S.C. §§80a-1 to
80a-52;

(4) The issuer is not engaged in and does not
propose to be engaged in petroleum exploration and production, mining, or
other extractive industries;

(5) The issuer is not a development stage company that either has no
specific business plan or purpose or has indicated that its business plan
is to engage in a merger or acquisition with an unidentified company or
companies or other entity or person; and

(6) The issuer is not disqualified under subsection (i) of this regulation.

(d) Minimum price. The offering price for common stock or common ownership
interests (hereinafter, collectively referred to as common stock), the
exercise price for options, warrants, or rights to common stock, or the
conversion price for securities convertible into common stock, must be
greater or equal to $5.00 per share or unit of interest. The issuer must
agree with the administrator that it will not split its common stock, or
declare a stock dividend for two years after the effective date of the
registration if such action has the effect of lowering the price below
$5.00.

(e) Commissions, fees or other remuneration for soliciting any prospective
purchaser in connection with the offering in the state are only paid to
persons who, if required to be registered or licensed, the issuer believes,
and has reason to believe, are appropriately registered or licensed in the
state.

(f) Financial statements shall be prepared in accordance with either U.S.
or Canadian generally accepted accounting principles. If appropriate, a
reconciliation note should be provided. If the company has not conducted
significant operations, statements of receipts and disbursements shall be
included in lieu of statements of income. Interim financial statements may
be unaudited. All other financial statements shall be audited by
independent certified public accountants; provided, however, that if each
of the following four conditions are met, such financial statements in lieu
of being audited may be reviewed by independent certified public
accountants in accordance with the Accounting and Review Service Standards
promulgated by the American Institute of Certified Public Accountants or
the Canadian equivalent:

(1) the company shall not have previously sold securities through an
offering involving the general solicitation of prospective investors by
means of advertising, mass mailing, public meetings, "cold call" telephone
solicitation, or any other method directed toward the public;

(2) the company has not been previously required under federal, state,
provincial or territorial securities laws to provide audited financial
statements in connection with any sale of its securities;

(3) the aggregate amount of all previous sales of securities by the company
(exclusive of debt financing
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with banks and similar commercial lenders) shall not exceed $1,000,000.00;
and

(4) the amount of the present offering does not exceed $1,000,000.00.

(g) The offering shall be made in compliance with Rule 504 of Regulation D,
Regulation A, or Section 3(a)(11) of the Securities Act of 1933.

(h) Filing Requirements and Fees. The issuer shall file an executed Form
U-1, Form U-2, Form U-2A, Form U-7 with exhibits, and shall include the fee
required by Rule 404. In addition, if the offering is made pursuant to Rule
504 of Regulation D, the issuer shall file a copy of its Form D as part of
its SCOR application; if the offering is made pursuant to Regulation A, the
issuer shall file a copy of its Form 1-A as part of its SCOR application.
That filing shall be made with the Commissioner at the same time it is
filed with the SEC.

(i) Disqualification. Unless the Commissioner determines that it is not
necessary under the circumstances that the disqualification under this
section be applied, application for registrations under this regulation
shall be denied if the issuer, any of its officers, directors, ten percent
or greater stockholders, promoters, or selling agents, or, any officer,
director or partner of any selling agent:

(1) has filed an application for registration which is subject to a
currently effective stop order entered pursuant to any state or provincial
securities laws within ten years prior to the filing of the registration
statement;

(2) has been convicted, within ten years prior to the filing of the current
application for registration, of any felony or misdemeanor in connection
with the offer, purchase, or sale of securities, or of any felony involving
fraud or deceit, including, but not limited to, forgery, embezzlement,
obtaining money under false pretenses, larceny, or conspiracy to defraud;

(3) is currently subject to any state or provincial administrative
enforcement order or judgment entered by that state's or province's
securities administrator within ten years prior to the filing of the
current application for registration;

(4) is subject to any state or provincial administrative enforcement order
or judgment in which fraud or deceit, including, but not limited to, making
untrue statements of material facts and omitting to state material facts,
was found, and the order or judgment was entered within ten years prior to
the filing of the current application for registration;

(5) is subject to any state or provincial administrative enforcement order
or judgment which prohibits, denies, or revokes the use of any exemption
from registration in connection with the offer, purchase or sale of
securities;

(6) is currently subject to any order, judgment, or
decree of any court of competent jurisdiction that temporarily,
preliminarily, or permanently restrains or enjoins such party from engaging
in or continuing any conduct or practice in connection with the purchase or
sale of any security, or involving the making of any false filing with the
state, entered within ten years prior to the filing of the current
application for registration; or

(7) has violated the law of a foreign jurisdiction governing or regulating
any aspect of the business of securities or banking or, within the past ten
years, has been the subject of an action of a securities regulator of a
foreign jurisdiction denying, revoking or suspending the right to engage in
the business of securities as a broker-dealer, agent, investment adviser or
investment adviser representative, or is the subject of an action of any
securities exchange or self-regulatory organization operating under the
authority of the securities regulator of a foreign jurisdiction suspending
or expelling such person from membership in such exchange or
self-regulatory organization.

(j) Waiver of disqualifications. Any of the disqualifications listed in
subsection (i) of this Rule may be waived if the Commissioner in the
exercise of his discretion should find good cause for such waiver.

§403 Notice Filings for Offerings of Investment Company Securities

(a) Except as provided in subsection (b) hereof, no investment company that
is registered under the Investment Company Act of 1940 or that has
currently filed a registration statement under the Securities Act of 1933
is required to file with the Commissioner, either prior to the initial
offer or after the initial offer in this state of a security which is a
covered security under Section 18(b)(2) of the Securities Act of 1933, a
copy of any document which is part of a federal registration statement
filed with the SEC or is part of an amendment to such federal registration
statement; provided, however, that such an investment company shall, prior
to the initial offer of such a covered security, file with the Commissioner
a Form NF for such security, together with a consent to service of process
signed by the issuer and a filing fee equal to one half of one percent of
the maximum aggregate offering price of securities to be offered in
Delaware in the initial offering, but not less than $200.00 or more than
$1,000.00.

(b) An investment company that is registered under the Investment Company
Act of 1940 or that has filed a registration statement under the Securities
Act of 1933 shall file, upon written request of the Commissioner and within
the time period set forth in the request, a copy of any document identified
in the request that is part of the federal registration statement filed
with the SEC or part of an amendment of such federal registration
statement.
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(c) An investment company offering in Delaware will be treated as a
separate security where the offering involves a fund with a share price,
asset value, class of shareholders, or set of assets that differs from
those of other securities for which other notice filings have been made.
Generally, this means that separate investment company "series" or
"portfolios" will be treated as separate securities for purposes of notice
filings under this section.

(d) The initial filing of a Form NF by an investment company pursuant to
subsection (a) hereof is effective for one year. The investment company
must renew its notice filing (or notice filings, where multiple filings
were made for multiple series or portfolios) annually by filing with the
Commissioner a Form NF and a filing fee in accordance with subsection (a)
hereof.

§404 Fees

(a) Fees for registering securities by coordination or by qualification
shall be one half of one percent of the maximum aggregate offering price of
securities to be offered in Delaware during the initial registration
period, but not less than $200.00 or more than $1,000.00.

(b) The amount of securities to be registered in Delaware shall be
specifically stated in the Form U-1. However, if the applicant pays the
maximum filing fee of $1,000.00, the amount to be registered in Delaware
may be stated in the Form U-1 as "indefinite" or "unlimited."

(c) All filing fees are due at the time of the initial application. No
application fee is refundable even though an application may be withdrawn
or denied.

§405 Quarterly Reports on Registered Securities

Quarterly reports shall be filed by a person who filed the registration
statement as long as the registration is effective in order to keep
reasonably current all information contained in the registration statement
and to disclose the progress of the offering.

§406 Filing of Sales Literature

Any prospectus, pamphlet, circular, form letter, advertisement, or other
sales literature or advertising communication addressed or intended for
distribution to prospective investors, including clients or prospective
clients of an investment adviser must be filed with the Securities
Commissioner unless the security or transaction is exempted by Section 7309
of the Act or the security is a federal covered security under Section
7309A of the Act.

§407 Notice Filings for SEC Regulation D Filings

(a) An issuer offering a security that is a covered security under section
18(b)(4)(D) of the Securities Act of 1933 shall file with the Commissioner
a notice on SEC
Form D and a consent to service of process on a Form U-2, Uniform Consent
to Service of Process, no later than 15 days after the first sale of such
federal covered security in this state.

(b) For purposes of this section, "SEC Form D" is defined as the document
adopted by the SEC and in effect on September 1, 1996 (and as may be
amended by the SEC from time to time), entitled "FORM D; Notice of Sale of
Securities pursuant to Regulation D, Section 4(6), and/or Uniform Limited
Offering Exemption", including Part E and the Appendix.

Part E. Exemptions from Registration

§500 Exemptions for Federal Covered Securities

Federal covered securities, as defined in Section 7302(a)(17) of the Act,
are exempt from registration under Section 7304 of the Act. Notice filings
are required for registered investment company offerings under Rule 403;
for limited offerings of securities under Rule 502; and for offers or sales
of securities in Delaware pursuant to SEC Rule 506, 17 C.F.R. §230.506.

§501 Designated Exchange Exemptions

Any security listed or approved for listing upon notice of issuance on the
Boston Stock Exchange or the Chicago Board Options Exchange is exempted
from Sections 7304, 7309A and 7312 of the Act pursuant to Section
7309(a)(8) of the Act.

§502 Limited Offering Exemptions

(a) Any offer or sale of securities made in compliance with SEC Rule 505,
17 C.F.R. §230.505 (Exemption for Limited Offers and Sales of Securities
Not Exceeding $5,000,000) of Regulation D under the Securities Act of 1933
and the provisions of this Rule is exempt from registration under the Act.

(b) To qualify for the limited offering exemption, the following conditions
and limitations must be met:

(1) No commission, fee or other remuneration shall be paid or given,
directly or indirectly, to any person for soliciting any prospective
purchaser in this state unless such person is appropriately registered
under the Act. It is a defense to a violation of this subsection if the
issuer sustains the burden of proof to establish that he or she did not
know and in the exercise of reasonable care could not have known that the
person who received a commission, fee or other remuneration was not
appropriately registered under the Act.

(2) The limited offering exemption is not available if the issuer, any of
its directors, officers, general partners, trustees, beneficial owners of
ten percent or more of a class of its equity interests, promoters currently
connected with it in any capacity, or any person
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(other than a broker-dealer currently registered under the Act) that has
been or will be paid or given, directly or indirectly, a commission or
similar remuneration for the solicitation of a prospective purchaser or in
connection with sales of securities under this exemption:

(i) within ten years before the first sale of securities in an offering
under this exemption has filed a registration statement or application for
exemption from registration that is currently subject to a stop order under
any state's securities laws;

(ii) within ten years before the first sale of securities in an offering
under this exemption has been convicted of or has pleaded nolo contendere
to a felony or misdemeanor in connection with the offer, purchase, or sale
of a security or in connection with the making of a false filing with the
SEC or with a state securities administrator, or a felony involving fraud
or deceit, including, but not limited to, forgery, embezzlement, obtaining
money under false pretenses, larceny, conspiracy to defraud, or theft;

(iii) is subject to an order, judgment or decree of a court of competent
jurisdiction temporarily or preliminarily restraining or enjoining, or is
subject to an order, judgment, or decree of a court of competent
jurisdiction entered within ten years before the first sale of securities
in an offering under this exemption permanently restraining or enjoining,
that person from engaging in or continuing any conduct or practice in
connection with the offer, purchase, or sale of a security or in connection
with the making of a false filing with the SEC or a state securities
administrator;

(iv) is the subject of any order or judgment which prohibits, denies or
revokes the use of any exemption from registration in connection with the
offer, purchase or sale of securities;

(v) is subject to a state administrative order entered by a state
securities administrator in which fraud or deceit was found, if the final
order was entered within ten years before the first sale of securities in
an offering under this exemption.

(3) Not later than 15 days after the first sale of securities under this
regulation, the issuer shall file with the Commissioner a manually signed
notice on a completed SEC Form D (Notice of Sale of Securities Pursuant to
Regulation D, Section 4(6), and/or Uniform Limited Offering Exemption), as
filed with the SEC and as that form may be amended from time to time. That
filing shall constitute an affirmation by the issuer that it has complied
with SEC Rule 505 and that upon written request the issuer shall furnish to
the Commissioner any and all information furnished by the issuer or its
agents to the offerees.

(4) In all sales to nonaccredited investors in Delaware, one of the
following conditions must be
satisfied or the issuer and any person acting on its behalf shall have
reasonable grounds to believe and after making reasonable inquiry shall
believe that one of the following conditions is satisfied:

(i) The investment is suitable for the purchaser upon the basis of the
facts, if any, disclosed by the purchaser as to the purchaser's other
security holdings, financial situation and needs.

(ii) The purchaser either alone or with his or her purchaser
representative(s) has such knowledge and experience in financial and
business matters that he or she is or they are capable of evaluating the
merits and risks of the prospective investment.

(c) Neither this regulation nor the Act provide an exemption from the
provisions of Section 7303 of the Act.

(d) The burden of proving an exemption under this regulation is on the
person claiming the exemption.

(e) The Commissioner may, by rule or order, increase the number of
purchasers or waive any other condition of this exemption.

§503 Accredited Investor Exemption

Any offer or sale of a security by an issuer in a transaction that meets
the following requirements of this rule is exempted from the securities
registration requirements of the Act.

(a) Sales of securities shall be made only to persons who are or the issuer
reasonably believes are "accredited investors" as that term is defined in
SEC Rule 501(a) of Regulation D.

(b) The exemption is not available to an issuer that is in the development
stage that either has no specific business plan or purpose or has indicated
that its business plan is to engage in a merger or acquisition with an
unidentified company or companies, or other entity or person.

(c) The issuer reasonably believes that all purchasers are purchasing for
investment and not with the view to or for sale in connection with a
distribution of the security. Any resale of a security sold in reliance on
this exemption within 12 months of sale shall be presumed to be with a view
to distribution and not for investment, except a resale pursuant to a
registration statement effective under the securities registration
requirements of the Act or to an accredited investor pursuant to another
applicable exemption under the Act.

(d) Disqualification.

(1) This exemption is not available to an issuer if the issuer, any of the
issuer's predecessors, any affiliated issuer, any of the issuer's
directors, officers, general partners, beneficial owners of ten percent or
more of any class of its equity securities, any of the issuer's promoters
presently connected with the issuer in any capacity, any underwriter of the
securities to be offered, or any partner,
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director or officer of such underwriter:

(i) within the last ten years, has filed a registration statement that is
the subject of a currently effective registration stop order entered by any
state securities administrator or the SEC;

(ii) within the last ten years, has been convicted of any criminal offense
in connection with the offer, purchase or sale of any security, or
involving fraud or deceit;

(iii) is currently subject to any order, judgment or decree of any court of
competent jurisdiction, entered within the last ten years, temporarily,
preliminarily or permanently restraining or enjoining such party from
engaging in or continuing to engage in any conduct or practice involving
fraud or deceit in connection with the purchase or sale of any security.

(e) General Announcement.

(1) A general announcement of the proposed offering may be made by any
means.

(2) The general announcement shall include only the following information,
unless additional information is specifically permitted by the
Commissioner:

(i) The name, address and telephone number of the issuer of the securities;

(ii) The name, a brief description and price (if known) of any security to
be issued;

(iii) A brief description of the business of the issuer in 25 words or
less;

(iv) The type, number and aggregate amount of securities being offered;

(v) The name, address and telephone number of the person to contact for
additional information; and

(vi) A statement that:

1. sales will only be made to accredited investors;

2. no money or other consideration is being solicited or will be accepted
by way of this general announcement; and

3. the securities have not been registered with or approved by any state
securities agency or the SEC and are being offered and sold pursuant to an
exemption from registration.

(f) The issuer, in connection with an offer, may provide information in
addition to the general announcement under paragraph (f), if such
information:

(1) is delivered through an electronic database that is restricted to
persons who have been prequalified as accredited investors; or

(2) is delivered after the issuer reasonably believes that the prospective
purchaser is an accredited investor.

(g) No telephone solicitation shall be permitted unless prior to placing
the call, the issuer reasonably
believes that the prospective purchaser to be solicited is an accredited
investor.

(h) Dissemination of the general announcement of the proposed offering to
persons who are not accredited investors shall not disqualify the issuer
from claiming the exemption under this rule.

(i) The issuer must file or cause to be filed with the Commissioner a
notice of exemption in the form prescribed by the Commissioner and a copy
of any general announcement, within 15 days after the first sale in this
state.

§504 World Class Foreign Issuer Exemptions

Any security that meets all of the following conditions shall be exempt
from the securities registration requirements of the Act:

(a) (1) Equity securities, except options, warrants, preferred stock,
subscription rights, securities convertible into equity securities or any
right to subscribe to or purchase such options, warrants, convertible
securities or preferred stock;

(2) Units consisting of equity securities permitted under subparagraph (1)
and warrants to purchase the same equity security being offered in the
unit;

(3) Non-convertible debt securities rated in one of the four highest rating
categories of Standard and Poor's, Moody's, Dominion Bond Rating Services
of Canadian Bond Rating Services or such other rating organization the
Commissioner by rule or order may designate. For purpose of this
subparagraph (2), the term "non-convertible debt securities" means
securities that cannot be converted for at least one year from the date of
issuance and then, only into equity shares of the issuer or its parent; or

(4) American Depository Receipts representing securities described in
subparagraphs (1) and (2) above;

(b) The issuer is not organized under the laws of the United States, or of
any state, territory or possession of the United States, or of the District
of Columbia or Puerto Rico;

(c) The issuer, at the time an offer or sale is made in reliance on the
securities exemption embodied in this rule, has been a going concern
engaged in continuous business operations for the immediate past five years
and during that period has not been the subject of a proceeding relating to
insolvency, bankruptcy, involuntary administration, receivership or similar
proceeding. For purposes of this paragraph, the operating history of any
predecessor that represented more than 50 percent of the value of the
assets of the issuer that otherwise would have met the conditions of this
rule may be used toward the five year requirement;

(d) The issuer, at the time an offer or sale is made
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in reliance on the securities exemption embodied in this rule, has a public
float of US $1 billion or more. For purposes of this paragraph:

(1) The term "public float" means the market value of all outstanding
equity shares owned by non-affiliates;

(2) The term "equity shares" means common shares, non-voting equity shares
and subordinate or restricted voting equity shares, but does not include
preferred shares; and

(3) An "affiliate" is anyone who owns beneficially, directly or indirectly,
or exercises control or direction over, more than ten percent of the
outstanding equity shares of such person;

(e) The market value of the issuer's equity shares, at the time an offer or
sale is made in reliance on the securities exemption embodied in this rule,
is US $3 billion or more. For purposes of this paragraph, the term "equity
shares" means common shares, non-voting equity shares and subordinate or
restricted voting equity shares, but does not include preferred shares; and

(f) The issuer, at the time an offer or sale is made in reliance on the
securities exemption embodied in this rule, has a class of equity
securities listed for trading on or through the facilities of a foreign
securities market included in SEC Rule 902(a)(1) or designated by the SEC
under SEC Rule 902(a)(2).

§505 Offers of Securities Through the Internet

(a) A communication that is placed on the Internet by or on behalf of an
issuer that is designed to raise capital and/or to distribute information
on available products or services and that is directed generally to anyone
having access to the Internet, whether through postings on "Bulletin
Boards," displays on "Home Pages," or otherwise (an "Internet
Communication") shall not constitute an offer within the meaning of Section
7302(11)(a) of the Act, and shall therefore constitute an exempt
transaction under the Act, provided that :

(1) The Internet Communication indicates by a prominent legend at the
beginning of the Internet Communication that the securities are not being
offered to any person in Delaware;

(2) An offer of the issuer's securities is not otherwise directed to any
person in Delaware by, or on behalf of, the issuer; and

(3) Unless otherwise exempt under the Act, no sale of the issuer's
securities is made in Delaware, as a result of the Internet Communication.

(b) Reliance on the exemption provided by this rule does not preclude an
issuer from relying on other available exemptions for offers provided under
the Act.

(c) The term "Internet" for the purposes of this rule includes the
Internet, the World Wide Web and similar
proprietary and common carrier electronic systems.

§506 Claim of Exemption by Persons Organized and Operated Not for Private
Profit but Exclusively for Religious Purposes

Any security issued by a person organized and operated not for private
profit but exclusively for religious, educational, benevolent or charitable
purposes shall be exempt from the securities registration requirement of
the Act provided as follows:

(a) The issuer is (1) a religious organization affiliated with, associated
with, or authorized by a religious denomination or denominations; or (2) a
religious organization that consists of or acts on behalf of individual or
local churches or local or regional church organizations.

(b) The issuer is an organization that qualifies and operates under Section
501(c)(3) of the Internal Revenue Code of 1986, as amended;

(c) The issuer, alone or through its predecessor organization:

(1) Has been in existence for over ten years;

(2) Has received audited financial statements with an unqualified opinion
from a certified public accountant for its most recent three fiscal years;
and

(3) Has experienced no defaults on any outstanding obligations to investors
for the period that it has issued securities.

(d) The issuer's:

(1) Cash, cash equivalents and readily marketable assets have had a market
value of at least five percent of the principal balance of its total
outstanding debt securities for the last three fiscal years or 36 months
prior to the issue; or

(2) Net worth, as that term is used in Generally Accepted Accounting
Principles, has been at least equal to three percent of its total assets
for the last three fiscal years or 36 months prior to the issue.

(e) Prior to any sale of the securities, the issuer provides an investor
with a disclosure document reflecting financial and other information
concerning the issuer and relevant risks involved in the investment.

(f) The issuer makes loans to or otherwise utilizes the net proceeds of the
offering in support of:

(1) Local churches, or other religious organizations affiliated or
associated with such churches; or

(2) Related religious organizations.

(g) The issuer:

(1) Has a net worth, as that term is used in Generally Accepted Accounting
Principles, of $5,000,000.00 or more which includes all church owned
property; or

(2) Makes loans, secured by either real property
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or by a pledge of readily marketable securities, at all times, having equal
or greater value than the loan amount, to finance the purchase,
construction or improvement of church related property, buildings, related
capital expenditures, or to refinance existing debt to be secured by such
property, or for other operating expenses of the entities described in (f)
above, provided the obligation is secured by such property.

§507 Claim of Exemption for Nine-Month Commercial Paper

Section 7309(a)(10) of the Act exempts from registration any commercial
paper which arises out of a current transaction (or the proceeds of which
have been or are to be used for current transactions), and which evidences
an obligation to pay cash within nine months of the date of issuance,
exclusive of days of grace, or any renewal of such paper which is likewise
limited, or any guarantee of such paper or of any such renewal. This
exemption is a narrow and specialized one. It applies only to prime quality
negotiable commercial paper of a type not ordinarily purchased by the
general public, that is, paper issued to facilitate well recognized types
of current operational business requirements and of a type eligible for
discounting by Federal Reserve Banks. The exemption is not available for
the unregistered public offering of promissory or collateral trust notes or
similar evidences of debt of any issuer directly to public investors
through solicitation or otherwise. Pursuant to Section 7304 of the Act, any
such offering must be registered or exempt from registration under an
exemption other than that provided by Section 7309(a)(10) of the Act.

§508 Recognized Securities Manuals

(a) Each of the following manuals shall be deemed a "Recognized Securities
Manual" for the purposes of 6 Del. C. §7309(b)(2):

(1) Moody's Industrial Manual

(2) Moody's Transportation Manual

(3) Moody's Public Utility Manual

(4) Moody's Bank and Finance Manual

(5) Standard & Poor's Standard Corporation Descriptions

(6) Fitch's Individual Stock Bulletin

(7) Moody's OTC Industrial Manual

(b) The term "manual" for purposes of this rule includes all commonly
recognized formats of publications, including CD-ROM and electronic
dissemination over the Internet.

§509 Unsolicited Sales

Acknowledgment by letter from a customer that a sale was unsolicited is a
prerequisite to the application of the exemption set forth at 6 Del. C.
§7309(b)(3).

§510 Transactional Exemption for Certain Institutional Buyers

(a) Pursuant to Section 7309(b)(8) of the Act, offers or sales to
institutional buyers are exempted from Sections 7304, 7309A and 7312 of the
Act. For purposes of this exemption, "institutional buyers" include the
following:

(1) an "accredited investor" as defined in SEC Rule 501(a)(1)-(4), (7) and
(8), 17 C.F.R. §230.501(a)(1)-(4), (7), (8), excluding, however, any
self-directed employee benefit plan with investment decisions made solely
by persons that are "accredited investors" as defined in Rule
501(a)(5)-(6);

(2) any "qualified institutional buyer" as that term is defined in SEC Rule
144A(a)(1), 17 C.F.R. §230.144A(a)(1); and

(3) a corporation, partnership, trust, estate, or other entity (excluding
individuals) having a net worth of not less than $5 million or a
wholly-owned subsidiary of such entity, as long as the entity was not
formed for the purpose of acquiring the specific securities.

(b) For purposes of determining a purchaser's total assets or net worth
under this section, the issuer and the seller may rely upon the entity's
most recent annual balance sheet or other financial statement which shall
have been audited by an independent accountant or which shall have been
verified by a principal of the purchaser.

(c) The offer or sale of securities is not exempt under Section 7309(b)(8)
or this rule if the institutional buyer is in fact acting only as an agent
for another purchaser that is not an institutional buyer or financial
institution listed in Section 7309(b)(8).

§511 Confirmation of Availability of Exemption

No oral communication with the Securities Division may be relied upon as
proving the availability of any exemption or any exclusion from a
definition. Such confirmation may only be obtained by a written opinion
from the Securities Division. A written opinion may be obtained by
submitting the fee set forth in Rule 102(h) along with a full description
of the subject matter, copies of any relevant documents and the identity of
the section or sections of the Delaware Securities Act on which the
exemption or exclusion is based.

Part F. Broker-Dealers, Broker-Dealer Agents, and Issuer Agents

§600 Registration of Broker-Dealers

(a) A person applying for a license as a broker-dealer in Delaware shall
make application for such license on Form BD (Uniform Application for
Broker-Dealer
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Registration). Amendments to such applications shall also be made on Form
BD.

(b) An applicant who is registered or registering under the Securities
Exchange Act of 1934 shall file its application, together with the fee
required by Section 7314 of the Act, with the NASD Central Registration
Depository ("CRD") and shall file with the Commissioner such other
information as the Commissioner may reasonably require.

(c) An applicant who is not registered or registering under the Securities
Exchange Act of 1934 shall file its application; the fee required by
Section 7314 of the Act; and an audited financial statement prepared in
accordance with 17 C.F.R. §240.17a-5(d) with the Commissioner, together
with such other information as the Commissioner may reasonably require.

(d) Any applicant for a broker-dealer license must also file a Form U-2
(Uniform Consent to Service of Process) with the Commissioner.

(e) A broker-dealer registered with the Commissioner shall register at
least one agent with the Commissioner.

(f) Registration expires at the end of the calendar year. Any broker-dealer
may renew its registration by filing with the NASD CRD, or with the
Commissioner in the case of a broker-dealer not registered under the
Securities Exchange Act of 1934, such information as is required by the
NASD, together with the fee required by Section 7314 of the Act.

§601 Registration of Broker-Dealer Agents

(a) A person applying for a license as a broker-dealer agent in Delaware
shall make application for such license on Form U-4 (Uniform Application
for Securities Industry Registration or Transfer). Amendments to such
application shall also be made on Form U-4.

(b) An applicant for registration as an agent for a broker-dealer that is a
member of the NASD shall file his or her application, together with the fee
required by Section 7314 of the Act, with the NASD CRD and shall file with
the Commissioner such other information as the Commissioner may reasonably
require.

(c) Any applicant for registration as an agent for a broker-dealer that is
not an NASD member shall file his or her application, together with the fee
required by Section 7314 of the Act, with the Commissioner, together with
such other information as the Commissioner may reasonably require.

(d) Any applicant for a broker-dealer agent license must also file a Form
U-2 (Uniform Consent to Service of Process) with the Commissioner and
successfully complete the Uniform Securities Agent State Law Examination
(Series 63 or 66) administered by the NASD. The Commissioner may waive the
exam requirement upon
good cause shown.

(e) Registration expires at the end of the calendar year. Any broker-dealer
agent may renew its registration by filing with the NASD CRD, or with the
Commissioner in the case of a broker-dealer agent employed by a
broker-dealer not registered under the Securities Exchange Act of 1934,
such information as is required by the NASD, together with the fee required
by Section 7314 of the Act.

§602 Registration of Issuer Agents

(a) A person applying for a license as an issuer agent in Delaware shall
make application for such license on Form U-4 (Uniform Application for
Securities Industry Registration or Transfer). Amendments to such
application shall also be made on Form U-4.

(b) An applicant for registration as an issuer agent shall file his or her
application and the fee required by Section 7314 of the Act with the
Commissioner, together with such further information as the Commissioner
may reasonably require.

(c) Any applicant for an issuer agent license must also file a Form U-2
(Uniform Consent to Service of Process) with the Commissioner and
successfully complete the Uniform Securities Agent State Law Examination
(Series 63 or 66) administered by the NASD. The Commissioner may waive the
exam requirement upon good cause shown.

§603 Continuing Obligation of Registrants to Keep Information Current

(a) Persons registering as broker-dealers, broker-dealer agents or issuer
agents are required to keep reasonably current the information set forth in
their applications for registration and to notify the Commissioner of any
material change to any information reported in their application for
registration.

(b) Failure to keep current the information set forth in an application or
to notify the Commissioner of any material change to any information
reported in the application shall constitute a waiver of any objection to
or claim regarding any action taken by the Commissioner in reliance on
information currently on file with the Commissioner.

§604 Minimum Financial Requirements and Financial Reporting Requirements of
Broker-Dealers

(a) Each broker-dealer registered or required to be registered under the
Act shall comply with SEC Rules 15c3-1 (17 C.F.R. §240.15c3-1), 15c3-2 (17
C.F.R. §240.15c3-2), and 15c3-3 (17 C.F.R. §240.15c3-3).

(b) Each broker-dealer registered or to be registered under the Delaware
Securities Act shall comply with SEC Rule 17a-11 (17 C.F.R. §240.17a-11)
and shall file with the Commissioner, upon request, copies of
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notices and reports required under SEC Rules 17a-5(17 C.F.R. §240.17a-5),
17a-10 (17 C.F.R. §240.17a-10), and 17a-11 (17 C.F.R. §240.17a-11).

(c) To the extent that the SEC promulgates changes to the above-referenced
rules, broker-dealers in compliance with such rules as amended shall not be
subject to enforcement action by the Securities Division for violation of
this section to the extent that the violation results solely from the
broker-dealer's compliance with the amended rule.

§605 Bonding Requirements of Intrastate Broker-Dealers

Every broker-dealer registered or required to be registered under the Act
whose business is exclusively intrastate, who does not make use of any
facility of a national securities exchange, and who is not registered under
Section 15 of the Securities Exchange Act of 1934 shall be bonded in an
amount of not less than $100,000 by a bonding company qualified to do
business in this state.

§606 Recordkeeping Requirements of Broker-Dealers

(a) Unless otherwise provided by order of the SEC, each broker-dealer
registered or required to be registered under the Act shall make, maintain,
and preserve books and records in compliance with SEC Rules 17a-3 (17
C.F.R. §240.17a-3), 17a-4 (17 C.F.R. §240.17a-4), 15c2-6 (17 C.F.R.
§240.15c2-6) and 15c2-11 (17 C.F.R. §240.15c2-11).

(b) To the extent that the SEC promulgates changes to the above-referenced
rules, broker-dealers in compliance with such rules as amended shall not be
subject to enforcement action by the Securities Division for violation of
this section to the extent that the violation results solely from the
broker-dealer's compliance with the amended rule.

§607 Use of the Internet for General Dissemination of Information on
Products and Services

(a) Broker-dealers and broker-dealer agents who use the Internet to
distribute information on available products and services through
communications made on the Internet directed generally to anyone having
access to the Internet, and transmitted through postings on Bulletin
Boards, displays on "Home Pages" or otherwise (an "Internet Communication")
shall not be deemed to be "transacting business" in Delaware for purposes
of Section 7313 of the Act based solely on the Internet Communication if
the following conditions are met:

(1) The Internet Communication contains a legend in which it is clearly
stated that:

(i) the broker-dealer or agent in question may only transact business in
Delaware if first registered, excluded or exempted from state broker-dealer
or agent
registration requirements, as the case may be; and

(ii) follow-up, individual responses to persons in Delaware by such
broker-dealer, or agent that involve either the effecting or attempting to
effect transactions in securities, will not be made absent compliance with
state broker-dealer or agent registration requirements, or an applicable
exemption or exclusion; (2) The Internet Communication contains a
mechanism, including and without limitations, technical "firewalls" or
other implemented policies and procedures, designed reasonably to ensure
that prior to any subsequent, direct communication with prospective
customers or clients in Delaware, said broker-dealer or agent is first
registered in Delaware or qualifies for an exemption or exclusion from such
requirement. Nothing in this paragraph shall be construed to relieve a
state registered broker-dealer or agent from any applicable securities
registration requirement in Delaware;

(3) The Internet Communication does not involve either effecting or
attempting to effect transactions in securities in Delaware over the
Internet, but is limited to the dissemination of general information on
products and services; and

(4) In the case of an agent:

(i) the affiliation with the broker-dealer is prominently disclosed within
the Internet Communication;

(ii) the broker-dealer with whom the agent is associated retains
responsibility for reviewing and approving the content of any Internet
Communication by the agent;

(iii) the broker-dealer or investment adviser with whom the agent is
associated first authorizes the distribution of information on the
particular products and services through the Internet Communication; and

(iv) in disseminating information through the Internet Communication, the
agent acts within the scope of the authority granted by the broker-dealer;

(b) The position expressed in this rule extends to state broker-dealer and
agent registration requirements only, and does not excuse compliance with
applicable securities registration, antifraud or related provisions;

(c) Nothing in this rule shall be construed to affect the activities of any
broker-dealer and agent engaged in business in this state that is not
subject to the jurisdiction of the Commissioner as a result of the National
Securities Markets Improvement Act of 1996, as amended.

§608 Registration Exemption for Certain Canadian Broker-Dealers

(a) A Canadian broker-dealer which meets the conditions of this rule as set

forth below shall be exempt from the registration requirement of Section
7313 of the Act.

(b) To be eligible for this exemption, the broker-
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dealer must be resident in Canada, have no office or other physical
presence in Delaware, and comply with the following conditions:

(1) Only effects or attempts to effect transactions in securities with, or
for, one or more of the following;

(i) A person from Canada who is temporarily present in Delaware, with whom
the Canadian broker-dealer had a bona fide business-client relationship
before the person entered Delaware;

(ii) A person from Canada who is present in Delaware, whose transactions
are in a self-directed tax advantaged retirement plan in Canada of which
the person is the holder or contributor; or

(iii) A "U.S. institutional investor" or a "major U.S. institutional
investor" to the extent permitted by SEC Reg. §240.15a-6 (17 CFR
§240.15a-6); and

(2) Is registered in its home province or territory, and a member in good
standing of a self-regulatory organization or stock exchange in Canada;

(3) Files with the Securities Commissioner a notice in the form of the
current application required by the jurisdiction in which its head office
is located;

(4) Files with the Securities Commissioner a consent to service of process
in a form which complies with the requirements of Section 7327 of the Act.

(5) Discloses to its clients in Delaware that it is not subject to the full
regulatory requirements of the Act; and

(6) Is not in violation of Sections 7303 or 7316 of the Act or any rules
promulgated thereunder.

(c) Exempt transactions. Offers or sales of any security effected by a
broker-dealer who is exempt from registration under this Regulation are
exempt from the registration requirements of Section 7304 of the Act.

§609 Prohibited Practices

(a) Each broker-dealer and broker-dealer agent registered in Delaware is
required to observe high standards of commercial honor and just and
equitable principles of trade in the conduct of their business. The acts
and practices described below in this rule, among others, are considered
contrary to such standards and may constitute grounds for denial,
suspension or revocation of registration or such other action authorized by
the Act.

(b) Broker-Dealers. For the purposes of 6 Del. C. §7316(a)(7), unethical
practices by a broker-dealer shall include, but not be limited to, the
following conduct:

(1) Engaging in an unreasonable and unjustifiable delay in the delivery of
securities purchased by any of its customers or in the payment, upon
request, of free credit balances reflecting completed transactions of any
of its customers, or failing to notify customers of their right to receive
possession of any certificate of ownership
to which they are entitled;

(2) Inducing trading in a customer's account that is excessive in size or
frequency in view of the customer's investment objective, level of
sophistication in investments, and financial situation and needs;

(3) Recommending a transaction without reasonable grounds to believe that
such transaction is suitable for the customer in light of the customer's
investment objective, level of sophistication in investments, financial
situation and needs, and any other information material to the investment;

(4) Executing a transaction on behalf of a customer without prior
authorization to do so;

(5) Exercising any discretionary power in effecting a transaction for a
customer's account without first obtaining written discretionary authority
from the customer, unless the discretionary power relates solely to the
time and/or price for the execution of orders;

(6) Executing any transaction in a margin account without securing from the
customer a properly executed written margin agreement promptly after the
initial transaction in the account;

(7) Failing to segregate and identify customer's free securities or
securities held in safekeeping;

(8) Hypothecating a customer's securities without having a lien thereon
unless the broker-dealer secures from the customer a properly executed
written consent promptly after the initial transaction, except as permitted
by SEC regulations;

(9) Entering into a transaction with or for a customer at a price not
reasonably related to the current market price of the security or receiving
an unreasonable commission or profit (commissions or profits equal to 10%
or more of the price of a security are presumed to be unreasonable);

(10) Failing to furnish to a customer purchasing securities in an offering,
no later than the date of confirmation of the transaction, either a final
prospectus or a preliminary prospectus and an additional document, which,
together with the preliminary prospectus, includes all information set
forth in the final prospectus;

(11) Charging unreasonable and inequitable fees for services performed,
including miscellaneous services such as collection of monies due for
principal, dividends or interest, exchange or transfer of securities,
appraisals, safekeeping, or custody of securities and other services
related to its securities business;

(12) Charging any fee for which no notice is given to the customer, and
consent obtained, prior to the event incurring the fee;

(13) Offering to buy from or sell to any person any security at a stated
price, unless such broker-dealer is prepared to purchase or sell, as the
case may be, at such price and under such conditions as are stated at the
time of
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such offer to buy or sell;

(14) Representing that a security is being offered to a customer "at the
market" or a price relevant to the market price, unless such broker-dealer
knows or has reasonable grounds to believe that a market for such security
exists other than that made, created or controlled by such broker-dealer,
or by any person for whom he is acting or with whom he is associated in
such distribution, or any person controlled by, controlling or under common
control with such broker-dealer;

(15) Effecting any transaction in, or inducing the purchase or sale of, any
security by means of any manipulative or deceptive device, practice, plan,
program, design or contrivance, that may include but not be limited to:

(i) Effecting any transaction in a security that involves no change in the
beneficial ownership thereof;

(ii) Entering an order or orders for the purchase or sale of any security
with the knowledge that an order or orders of substantially the same size,
at substantially the same time and substantially the same price, for the
sale of any such security, has been or will be entered by or for the same
or different parties for the purpose of creating a false or misleading
appearance of active trading in the security or false or misleading
appearance with respect to the market for the security; provided, however,
nothing in this subparagraph shall prohibit a broker-dealer from entering
bona fide agency cross transactions for its customers; or

(iii) Effecting, alone or with one or more other persons, a series of
transactions in any security creating actual or apparent active trading in
such security or raising or depressing the price of such security for the
purpose of inducing the purchase or sale of such security by others;

(16) Guaranteeing a customer against loss in any securities account of such
customer carried by the broker-dealer or in any securities transaction
effected by the broker-dealer with or for such customer;

(17) Publishing or circulating or causing to be published or circulated,
any notice, circular, advertisement, newspaper article, investment service,
or communication of any kind that purports to report any transaction as a
purchase or sale of any security, unless such broker-dealer believes that
such transaction was a bona fide purchase or sale of such security; or that
purports to quote the bid price or asked price for any security, unless
such broker-dealer believes that such quotation represents a bona-fide bid
for, or offer of, such security;

(18) Using any advertising or sales presentation in such a fashion as to be
deceptive or misleading. An example of such practice would be a
distribution of any nonfactual data, material, or presentation based on
conjecture, unfounded or unrealistic claims or assertions in a brochure,
flyer, or display by words, pictures, graphs or otherwise designed to
supplement, detract from, supersede or defeat the purpose or effect of any
prospectus or disclosure;

(19) Failing to disclose that the broker-dealer is controlled by,
controlling, affiliated with or under common control with the issuer of any
security before entering into any contract with or for a customer for the
purchase or sale of such security, and, if such disclosure is not made in
writing, it shall be supplemented by the giving or sending of written
disclosure at or before the completion of the transaction;

(20) Failing to make a bona fide public offering of all the securities
allotted to a broker-dealer for distribution, whether acquired as an
underwriter or a selling group member, or from a member participating in
the distribution as an underwriter or selling group member;

(21) Failing or refusing to furnish a customer, upon reasonable request,
information to which he is entitled, including:

(i) with respect to a security recommended by the broker-dealer, material
information that is reasonably available; and

(ii) a written response to any written request or complaint;

(22) Making a recommendation that one customer buy a particular security
and that another customer sell that security, where the broker-dealer acts
as a principal and such recommendations are made within a reasonably
contemporaneous time period, unless individual suitability considerations
or preferences justify the different recommendations;

(23) Where the broker-dealer holds itself out as a market maker in a
particular security, or publicly quotes bid prices in a particular
security, failing to buy that security from a customer promptly upon the
customer's request to sell;

(24) Recommending a security to its customers without conducting a
reasonable inquiry into the risks of that investment or communicating those
risks to its agents and its customers in a reasonably detailed manner and
with such emphasis as is necessary to make the disclosure meaningful;

(25) Representing itself as a financial or investment planner, consultant,
or adviser, when the representation does not fairly describe the nature of
the services offered, the qualifications of the person offering the
services, and the method of compensation for the services;

(26) Falsifying any record or document or failing to create or maintain any
required record or documents;

(27) Violating any ethical standard in the
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conduct rules promulgated by the National Association of Securities
Dealers; or

(28) Aiding or abetting any of the conduct listed above.

(c) Broker-Dealer Agents and Issuer Agents. For the purposes of 6 Del. C.
§7316(a)(7), unethical practices by a broker-dealer agent or an issuer
agent shall include, but not be limited to, the following conduct:

(1) Engaging in the practice of lending or borrowing money or securities
from a customer, or acting as a custodian for money, securities or an
executed stock power of a customer;

(2) Effecting securities transactions not recorded on the regular books or
records of the broker-dealer that the agent represents, unless the
transactions are authorized in writing by the broker-dealer prior to
execution of the transaction;

(3) Establishing or maintaining an account containing fictitious
information in order to execute transactions that would otherwise be
prohibited;

(4) Sharing directly or indirectly in profits or losses in the account of
any customer without the written authorization of the customer and the
broker-dealer that the agent represents;

(5) Dividing or otherwise splitting the agent's commissions, profits or
other compensation from the purchase or sale of securities with any person
not also registered as an agent for the same broker-dealer or for a
broker-dealer under direct or indirect common control;

(6) Where a recommendation is made that an unsophisticated customer
purchase an over-the-counter security that (A) trades sporadically or in
small volume, and (B) is not traded on any United States securities
exchange (excluding the Spokane Exchange) or on the NASDAQ National Market
System, failing to inform the customer that he may not be able to find a
buyer if the customer would subsequently want to sell the security;

(7) Where a recommendation is made to purchase an over-the-counter security
in which the asked price is greater than the bid by 25 percent or more,
failing to inform the customer of the bid and the asked prices and of the
significance of the spread between them should the customer wish to resell
the security;

(8) Using excessively aggressive or high pressure sales tactics, such as
repeatedly telephoning and offering securities to individuals who have
expressed disinterest and have requested that the calls cease, or using
profane or abusive language, or calling prospective customers at home at an
unreasonable hour at night or in the morning;

(9) Conducting or facilitating securities transactions outside the scope of
the agent's relationship with his broker-dealer employer unless he has
provided prompt written notice to his employer;

(10) Acting or registering as an agent of more than one broker-dealer
without giving written notification to and receiving written permission
from all such broker-dealers; or

(11) Holding himself out as an objective investment adviser or financial
consultant without fully disclosing his financial interest in a recommended
securities transaction at the time the recommendation is made;

(12) Engaging in any of the conduct specified in subparagraph (b) above; or

(13) Aiding or abetting any of the conduct listed above.

(d) Prohibited practices in connection with investment company shares. For
purposes of 6 Del. C. §7316(a)(7), unethical practices by a broker-dealer,
broker-dealer agent or issuer agent shall include, but not be limited to,
the following conduct:

(1) In connection with the offer or sale of investment company shares,
failing to adequately disclose to a customer all sales charges, including
asset based and contingent deferred sales charges, which may be imposed
with respect to the purchase, retention or redemption of such shares;

(2) In connection with the offer or sale of investment company shares,
stating or implying to a customer, either orally or in writing, that the
shares are sold without a commission, are "no load" or have "no sales
charge" if there is associated with the purchase of the shares a front-end
loan, a contingent deferred sales load, a SEC Rule 12B-1 fee or a service
fee which exceeds .25 percent of average net fund assets per year, or in
the case of closed-end investment company shares, underwriting fees,
commissions or other offering expenses;

(3) In connection with the offer or sale of investment company shares,
failing to disclose to a customer any available sales charge discount on
the purchase of shares in dollar amounts at or above a breakpoint or the
availability of a letter of intent feature which will reduce the sales
charges to the customer;

(4) In connection with the offer or sale of investment company shares,
recommending to a customer the purchase of a specific class of investment
company shares in connection with a multi-class sales charge or fee
arrangement without reasonable grounds to believe that the sales charge or
fee arrangement associated with such class of shares is suitable and
appropriate based on the customer's investment objectives, financial
situation and other securities holdings, and the associated transaction or
other fees;

(5) In connection with the offer or sale of investment company shares,
recommending to a customer the purchase of investment company shares which
results in the customer simultaneously holding shares in different
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investment company portfolios having similar investment objectives and
policies without reasonable grounds to believe that such recommendation is
suitable and appropriate based on the customer's investment objectives,
financial situation and other securities holdings, and any associated
transaction charges or other fees;

(6) In connection with the offer or sale of investment company shares,
recommending to a customer the liquidation or redemption of investment
company shares for the purpose of purchasing shares in a different
investment company portfolio having similar investment objectives and
policies without reasonable grounds to believe that such recommendation is
suitable and appropriate based on the customer's investment objectives,
financial situation and other securities holdings and any associated
transaction charges or other fees;

(7) In connection with the offer or sale of investment company shares,
stating or implying to a customer, either orally or in writing, the fund's
current yield or income without disclosing the fund's most recent average
annual total return, calculated in a manner prescribed in SEC Form N-1A,
for one, five and ten year periods and fully explaining the difference
between current yield and total return; provided, however, that if the
fund's registration statement under the Securities Act of 1933 has been in
effect for less than one, five, or ten years, the time during which the
registration statement was in effect shall be substituted for the periods
otherwise prescribed;

(8) In connection with the offer or sale of investment company shares,
stating or implying to a customer, either orally or in writing, that the
investment performance of an investment company portfolio is comparable to
that of a savings account, certificate of deposit or other bank deposit
account without disclosing to the customer that the shares are not insured
or otherwise guaranteed by the FDIC or any other government agency and the
relevant differences regarding risk, guarantees, fluctuation of principal
and/or return, and any other factors which are necessary to ensure that
such comparisons are fair, complete and not misleading;

(9) In connection with the offer or sale of investment company shares,
stating or implying to a customer, either orally or in writing, the
existence of insurance, credit quality, guarantees or similar features
regarding securities held, or proposed to be held, in the investment
company's portfolio without disclosing to the customer other kinds of
relevant investment risks, including but not limited to, interest rate,
market, political, liquidity, or currency exchange risks, which may
adversely affect investment performance and result in loss and/or
fluctuation of principal notwithstanding the creditworthiness of such
portfolio securities;

(10) In connection with the offer or sale of
investment company shares, stating or implying to a customer, either orally
or in writing, (i) that the purchase of such shares shortly before an
ex-dividend date is advantageous to such customer unless there are
specific, clearly described tax or other advantages to the customer, or
(ii) that a distribution of long-term capital gains by an investment
company is part of the income yield from an investment in such shares;

(11) In connection with the offer or sale of investment company shares,
making representations to a customer, either orally or in writing, that the
broker-dealer or agent knows or has reason to know are based in whole or in
part on information contained in dealer-use-only material which has not
been approved for public distribution; or

(12) Aiding or abetting any of the conduct listed above.

(13) In connection with the offer or sale of investment company shares, the
delivery of a prospectus shall not be dispositive that the broker-dealer or
agent has fulfilled the duties set forth in the subparagraphs of this rule.

(e) The conduct set forth above is not exclusive. Engaging in other conduct
such as forgery, embezzlement, theft, exploitation, nondisclosure,
incomplete disclosure or misstatement of material facts, manipulative or
deceptive practices, or aiding or abetting any unethical practice, shall be
deemed an unethical business practice and shall also be grounds for denial,
suspension or revocation of registration.

Part G. Investment Advisers and Investment Adviser Representatives

§700 Registration of Investment Advisors

(a) A person applying for a license as an investment adviser in Delaware
shall make application for such license on Form ADV (Uniform Application
for Investment Adviser Registration under the Investment Advisers Act of
1940). Amendments to such application shall also be made on Form ADV.

(b) The applicant shall file the following items with the Commissioner: (i)
the application on Form ADV; (ii) the fee required by Section 7314 of the
Act; (iii) a balance sheet prepared in accordance with Schedule G of Form
ADV; (iv) a form U-2 (Uniform Consent to Service of Process); (v) a list of
all investment adviser representatives employed by the investment adviser;
and (vi) such other information as the Commissioner may reasonably require.

(c) Registration expires at the end of the calendar year. Any investment
adviser may renew its registration by filing with the Commissioner an
updated Form ADV, together with the fee required by Section 7314 of the Act
and a list of all investment adviser representatives
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employed by the investment adviser.

(d) At least one investment adviser representative must be registered with
any investment adviser to obtain or to maintain its license as an
investment adviser.

§701 Registration of Investment Adviser Representatives

(a) A person applying for a license as an investment adviser representative
in Delaware shall make application for such license on Form U-4 (Uniform
Application for Securities Industry Registration or Transfer). Amendments
to such application shall also be made on Form U-4.

(b) The applicant shall file the following items with the Commissioner: (i)
the application on Form U-4; (ii) the fee required by Section 7314 of the
Act; (iii) a certification that the applicant has successfully completed
the Uniform Investment Adviser Law Examination (Series 65 or 66)
administered by the NASD; (iv) a Form U-2 (Uniform Consent to Service of
Process); and (v) such other information as the Commissioner may reasonably
require. The Commissioner may waive the exam requirement upon good cause
shown.

(c) Registration expires at the end of the calendar year. Any investment
adviser representative may renew his or her registration by filing with the
Commissioner a letter of intent to renew and the fee required by Section
7314 of the Act.

§702 Notice Filing Requirements for Federal Covered Advisers

(a) The notice filing for a federal covered adviser pursuant to 6 Del. C.
§7314 shall be filed with the Commissioner on an executed Form ADV (Uniform
Application for Investment Adviser Registration (17 C.F.R. §279)) and shall
include: (i) the consent to service of process required by 6 Del. C. §7327,
and (ii) the fee required by Section 7314 of the Act.

(b) The renewal of the notice filing for a federal covered adviser pursuant
to Section 7314(b) of the Act shall be filed upon Form ADV-S (or Schedule
1, if adopted by the SEC) and shall contain the fee required by Section
7314(c) of the Act.

§703 Continuing Obligation of Registrants to Keep Information Correct

(a) Persons registering as investment advisers or investment adviser
representatives are required to keep reasonably current the information set
forth in their applications for registration and to notify the Commissioner
of any material change to any information reported in their applications
for registration.

(b) Failure to keep current the information set forth in an application or
to notify the Commissioner of any material change to any information
reported in the
application shall constitute a waiver of any objection to or claim
regarding any action taken by the Commissioner in reliance on information
currently on file with the Commissioner.

§704 Minimum Financial Requirements for Investment Advisers

(a) All investment advisers registered or required to be registered under
the Act shall maintain at all times, regardless of any bond permitted under
this Rule, a minimum net worth of $1.00. The amount of required minimum net
worth for certain investment advisers shall be increased subject to
subparagraphs (1) and (2) below. "Assets under management" for purposes of
this rule shall mean the assets under management as disclosed on the
adviser's current Form ADV or any schedule or supplement thereto filed with
the Commissioner.

(1) An investment adviser registered or required to be registered under the
Act who has custody of client funds or securities shall maintain at all
times a minimum net worth of $35,000.00 or one percent of such adviser's
assets under management, whichever is greater. Such investment adviser who
is registered or required to be registered under the Act and has custody of
client funds or securities and fails to meet the foregoing minimum net
worth standard shall supplement the bond required in Rule 705 by increasing
the bond value by the amount of net worth deficiency, rounded up to the
nearest $5,000.00.

(2) An investment adviser registered or required to be registered under the
Act who has discretionary authority over client funds or securities but
does not have custody of client funds or securities, shall maintain at all
times a minimum net worth of $10,000.00 or one-fifth of one percent of such
adviser's assets under management, whichever is greater, unless such
adviser posts a bond pursuant to Rule 705.

(b) Unless otherwise exempted, as a condition of the right to continue to
transact business in this state, every investment adviser registered or
required to be registered under the Act shall, by the close of business on
the next business day, notify the Commissioner if such investment adviser's
total net worth falls below the minimum required. After transmitting such
notice, each investment adviser shall, by the close of business on the next
business day, file a report with the Commissioner of its financial
condition, including the following:

(1) A trial balance of all ledger accounts;

(2) A statement of all client funds, securities or assets which are not
segregated;

(3) A computation of the aggregate amount of client ledger debit balances;
and

(4) A statement as to the number of client accounts.

(c) For purposes of this Rule, the term "net worth"
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shall mean the excess of assets over liabilities, as determined by
generally accepted accounting principles, but shall not include as assets:
prepaid expenses (except as to items properly classified as current assets
under generally accepted accounting principles), deferred charges,
goodwill, franchise rights, organizational expenses, patents, copyrights,
marketing rights, unamortized debt discount and expense, any asset of
intangible nature, home, home furnishings, automobile(s), any personal item
not readily marketable (in the case of an individual), advances or loans to
stockholders and officers (in the case of a corporation), and advances or
loans to partners (in the case of a partnership). For purposes of this
Rule, the term "net capital" in Section 222(c) of the Investment Advisers
Act of 1940 shall have the same meaning as "net worth" as defined in this
subsection.

(d) The Commissioner may require that a current appraisal be submitted in
order to establish the worth of any asset.

(e) Every investment adviser that has its principal place of business in a
state other than this state shall maintain such minimum capital as required
by the state in which the investment adviser maintains its principal place
of business, provided the investment adviser is licensed in such state and
is in compliance with such state's minimum capital requirements.

§705 Bonding Requirements of Certain Investment Advisers

(a) Any bond required by this rule shall be issued by a company qualified
to do business in this state in the form determined by the Commissioner and
shall be subject to the claims of all clients of the investment adviser
regardless of the clients' state of residence. "Assets under management"
for purposes of this rule shall mean the assets under management as
disclosed on the adviser's current Form ADV or any schedule or supplement
thereto filed with the Commissioner.

(1) Every investment adviser registered or required to be registered under
the Act having custody of client funds or securities shall be bonded in an
amount equal to one percent of such adviser's assets under management,
rounded up to the nearest $5000.00, up to a maximum bond of $100,000.00,
exclusive of any supplemental bond required by Rule 704(d)(1)(a)(1). If an
investment adviser having custody of client funds or securities fails to
meet the minimum net worth requirement of Rule 704(a)(1), the adviser shall
supplement the required bond pursuant to Rule 704(a)(1).

(2) Every investment adviser registered or required to be registered under
the Act having discretionary authority over client funds or securities but
not having custody of client funds or securities that fails to
meet the net worth requirements of Rule 704(a)(2) shall be bonded in an
amount equal to the adviser's required net worth as determined under
704(a)(2), rounded up to the nearest $5000.00.

(b) An investment adviser that has its principal place of business in a
state other than Delaware shall be exempt from the requirements of
subsection (a) of this section, provided that the investment adviser is
registered as an investment adviser in the state where it has its principal
place of business and is in compliance with such state's requirements
relating to bonding.

§706 Recordkeeping Requirements of Investment Advisers

(a) Every investment adviser registered or required to be registered under
this Act shall make and keep true, accurate and current the following
books, ledgers and records:

(1) Those books and records required to be maintained and preserved in
compliance with Rule 204-2 of the Investment Advisers Act of 1940 (17
C.F.R. 275.204-2 (1996)), notwithstanding the fact that the investment
adviser is not registered or required to be registered under the Investment
Advisers Act of 1940.

(2) All trial balances, financial statements prepared in accordance with
generally accepted accounting principles, and internal audit working papers
relating to the investment adviser's business as an investment adviser. For
purposes of this subsection, "financial statements" means balance sheets,
income statements, cash flow statements and net worth computations as
required by Rule 202(d)-1.

(3) A list or other record of all accounts with respect to the funds,
securities, or transactions of any client.

(4) A copy in writing of each agreement entered into by the investment
adviser with any client.

(5) A file containing a copy of each record required by Rule 204-2(11) of
the Investment Advisers Act of 1940 including any communication by
electronic media that the investment adviser circulates or distributes,
directly or indirectly, to two or more persons (other than persons
connected with the investment adviser).

(6) A copy of each written statement and each amendment or revision given
or sent to any client or prospective client of the investment adviser in
accordance with the provisions of Rule 706(b)(1) and a record of the dates
that each written statement, and each amendment or revision was given or
offered to be given to any client or prospective client who subsequently
becomes a client.

(7) For each client that was obtained by the adviser by means of a
solicitor to whom a cash fee was paid by the adviser, records required by
Rule 206(4)-3 of the Investment Advisers Act of 1940, notwithstanding the
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fact that the investment adviser is not registered or required to be
registered under the Investment Advisers Act of 1940.

(8) All records required by Rule 204-2(16) of the Investment Advisers Act
of 1940 including but not limited to electronic media that the investment
adviser circulates or distributes, directly or indirectly, to two or more
persons (other than persons connected with the investment adviser).

(9) A file containing a copy of all communications received or sent
regarding any litigation involving the investment adviser or any investment
adviser representative or employee, and regarding any customer or client
complaint.

(10) Written information about each investment advisory client that is the
basis for making any recommendation or providing any investment advice to
such client.

(11) Written procedures to supervise the activities of employees and
investment adviser representatives that are reasonably designed to achieve
compliance with applicable securities laws and regulations.

(12) A file containing a copy of each document (other than any notices of
general dissemination) that was filed with or received from any state or
federal agency or self regulatory organization and that pertains to the
registrant or its investment adviser representatives which file should
contain, but is not limited to, all applications, amendments, renewal
filings, and correspondence.

(b) (1) Books and records required to be made under the provisions of
paragraph (a)(1) of this Rule shall be maintained and preserved in an
easily accessible place for a period of not less than five years from the
end of the fiscal year during which the last entry was made on such record,
the first two years in the principal office of the investment adviser.

(2) Books and records required to be made under the provisions of
paragraphs (a)(2)-(12), inclusive, of this Rule shall be maintained and
preserved in an easily accessible place for a period of not less than five
years from the end of the fiscal year during which the last entry was made
on such record, the first two years in the principal office of the
investment adviser, or for the time period during which the investment
adviser was registered or required to be registered in the state, if less.

(3) Each investment adviser representative who is registered or required to
be registered in this state and who has a business location in this state
shall maintain at such business location (A) the records or copies required
under the provisions of paragraphs(a)(3), (a)(7)-(10), (a)(14)-(15), (b),
and (c), inclusive, of Rule 204-2 of the Investment Advisers Act of 1940;
(B) the records or copies required under the provisions of paragraphs
(a)(2)-(11), inclusive, of this Rule related to customers or clients
for whom the investment adviser representative provides or has provided
investment advisory services; and (C) the records or copies required under
the provision of paragraph (a)(11) and (a)(16) of Rule 204-2 of the
Investment Advisers Act of 1940 which records or related records identify
the name of the investment adviser representative or which identify the
business location's physical address, mailing address, electronic mailing
address, or telephone number. The records will be maintained for the period
described in subsections (d) and (e) of Rule 204-2 of the Investment
Advisers Act of 1940. The investment adviser shall be responsible for
ensuring compliance with the provisions of this subsection.

(c) To the extent that the SEC promulgates changes to the above-referenced
rules of the Investment Advisers Act of 1940, investment advisers in
compliance with such rules as amended shall not be subject to enforcement
action by the Commissioner for violation of this Rule to the extent that
the violation results solely from the investment adviser's compliance with
the amended rule.

(d) Every investment adviser that has its principal place of business in a
state other than Delaware shall be exempt from the requirements of this
section, provided the investment adviser is licensed in such state and is
in compliance with the state's recordkeeping requirements.

§707 Use of the Internet for General Dissemination of Information on
Products and Services

(a) Investment advisers and investment adviser representatives who use the
Internet to distribute information on available products and services
through communications made on the Internet directed generally to anyone
having access to the Internet, and transmitted through postings on Bulletin
Boards, displays on "Home Pages" or otherwise (an "Internet Communication")
shall not be deemed to be "transacting business" in Delaware for purposes
of Section 7313 of the Act based solely on the Internet Communication if
the following conditions are met:

(1) The Internet Communication contains a legend in which it is clearly
stated that:

(i) The investment adviser or representative in question may only transact
business in this state if first registered, excluded or exempted from state
investment adviser or representative registration requirement, as the case
may be; and

(ii) follow-up individualized responses to persons in Delaware by such
investment adviser or representative that involve the rendering of
personalized investment advice for compensation will not be made absent
compliance with state investment adviser or representative registration
requirements, or an applicable exemption or exclusion;

(2) The Internet Communication contains a
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mechanism, including and without limitation, technical "firewalls" or other
implemented policies and procedures, designed reasonably to ensure that
prior to any subsequent, direct communication with prospective customers or
clients in this state, said investment adviser or representative is first
registered in Delaware or qualifies for an exemption or exclusion from such
requirement. Nothing in this paragraph shall be construed to relieve a
state registered investment adviser or representative from any applicable
securities registration requirement in Delaware;

(3) The Internet Communication does not involve the rendering of
personalized advice for compensation in Delaware over the Internet, but is
limited to the dissemination of general information on products and
services; and

(4) In the case of a representative:

(i) the affiliation with the investment adviser is prominently disclosed
within the Internet Communication;

(ii) the investment adviser with whom the representative is associated
retains responsibility for reviewing and approving the content of any
Internet Communication by the representative;

(iii) the investment adviser with whom the representative is associated
first authorizes the distribution of information on the particular products
and services through the Internet Communication; and

(iv) in disseminating information through the Internet Communication, the
representative acts within the scope of the authority granted by the
investment adviser;

(b) The position expressed in this rule extends to state investment adviser
and

representative registration requirements only, and does not excuse
compliance with applicable securities registration, antifraud or related
provisions;

(c) Nothing in this rule shall be construed to affect the activities of any
investment adviser and representative engaged in business in Delaware that
is not subject to the jurisdiction of the Commissioner as a result of the
National Securities Markets Improvements Act of 1996, as amended.

§708 Custody of Client Funds or Securities

It is unlawful for an investment adviser to take or have custody of any
securities or funds of any client unless:

(a) The investment adviser notifies the Commissioner in writing that the
investment adviser has or may have custody;

(b) The securities of each client are segregated, marked to identify the
particular client having the beneficial interest in those securities, and
held in safekeeping in a place reasonably free from risk of
destruction or other loss;

(c) All client funds are deposited as follows:

(1) In one or more bank accounts containing only clients' funds;

(2) The account or accounts are maintained in the name of the investment
adviser as agent or trustee for the clients; and

(3) The investment adviser maintains a separate record for each account
showing the name and address of the bank where the account is maintained,
the dates and amounts of deposits in and withdrawals from the account, and
the exact amount of each client's beneficial interest in the account;

(d) Immediately after accepting custody or possession of funds or
securities from any client, the investment adviser notifies the client in
writing of the place and manner in which the funds and securities will be
maintained and subsequently, if or when there is a change in the place or
the manner in which the funds or securities are maintained, the investment
adviser gives written notice to the client;

(e) At least once every 3 months, the investment adviser sends to each
client an itemized statement showing the client's funds and securities in
the investment adviser's custody at the end of the period, and all debits,
credits and transactions in the client's account during that period; and

(f) At least once every calendar year, an independent certified public
accountant or public accountant verifies all client funds and securities by
an actual examination, which shall be made at a time chosen by the
accountant without prior notice to the investment adviser. A report stating
that the accountant has made an examination of the client funds and
securities in the custody of the investment adviser, and describing the
nature and extent of the examination, shall be filed with the Commissioner
within 30 days after each examination.

§709 Prohibited Practices

(a) A person who is an investment adviser, a federal covered adviser, or an
investment adviser representative is a fiduciary and has a duty to act
primarily for the benefit of the client. While the extent and nature of
this duty varies according to the nature of the relationship with the
client and the circumstances of each case, no investment adviser, federal
covered adviser or representative shall engage in any unethical business
practice including but not limited to the following:

(1) Recommending to a client, to whom investment supervisory, management or
consulting services are provided, the purchase, sale, or exchange of any
security without reasonable grounds to believe that the recommendation is
suitable for the client on the basis of information furnished by the client
after reasonable
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inquiry concerning the client's investment objectives, financial situation
and needs, and any other information known by the investment adviser.

(2) Exercising any discretionary power in placing an order for the purchase
or sale of securities for a client without obtaining written discretionary
authority from the client within ten business days after the date of the
first transaction placed pursuant to oral discretionary authority, unless
the discretionary power relates solely to the price at which, or the time
when, an order involving a definite amount of a specific security that
shall be executed, or both.

(3) Inducing trading in a client's account that is excessive in size or
frequency in view of the client's financial resources and investment
objectives and the character of the account.

(4) Placing an order to purchase or sell a security for the account of a
client without authority to do so.

(5) Placing an order to purchase or sell a security for the account of a
client upon instruction of a third party without first having obtained a
written third party trading authorization from the client.

(6) Borrowing money or securities from a client, unless the client is a
broker-dealer, an affiliate of the investment adviser, or a financial
institution engaged in the business of loaning funds.

(7) Loaning money to a client, unless the investment adviser is a financial
institution engaged in the business of loaning funds or the client is an
affiliate of the investment adviser.

(8) To misrepresent to any advisory client, or prospective advisory client,
the qualifications of the investment adviser or any employee of the
investment adviser, or to misrepresent the nature of the advisory services
being offered or fees to be charged for such service, or to omit to state a
material fact necessary to make the statements made regarding
qualifications, services, or fees, in light of the circumstances under
which they are made, not misleading.

(9) Providing a report or recommendation to any advisory client prepared by
someone other than the adviser without disclosing the fact; provided,
however, that this prohibition does not apply to a situation where the
adviser uses published research reports or statistical analyses to render
advice or where an adviser orders such a report in the normal course of
providing service.

(10) Charging a client an unreasonable advisory fee.

(11) Failing to disclose to clients, in writing, before any advice is
rendered, any material conflict of interest relating to the adviser or any
of its employees which could reasonably be expected to impair the rendering
of unbiased and objective advice, including:

(i) Compensation arrangements connected
with advisory services which are in addition to compensation from such
clients for such services; and

(ii) Charging a client an advisory fee for rendering advice when a
commission for executing securities transactions pursuant to such advice
will be received by the adviser or its employees.

(12) Guaranteeing a client that a specific result will be achieved (gain or
no loss) with advice to be rendered.

(13) Publishing, circulating, or distributing any advertisement which does
not comply with Rule 206(4)-1 under the Investment Advisers Act of 1940.

(14) Disclosing the identity, affairs, or investments of any client, unless
required by law to do so, or unless consented to by the client.

(15) Taking any action, directly or indirectly, with respect to those
securities or funds in which any client has any beneficial interest, where
the investment adviser has custody or possession of such securities or
funds when the adviser's action is subject to and does not comply with the
requirements of Rule 206(4)-2 under the Investment Advisers Act of 1940.

(16) Entering into, extending, or renewing any investment advisory
contract, unless such contract is in writing and discloses, in substance,
the services to be provided, the term of the contract, the advisory fee,
the formula for computing the fee, the amount of prepaid fee to be returned
in the event of contract termination or non-performance, whether the
contract grants discretionary power to the adviser, and that no assignment
of such contract shall be made by the investment adviser without the
consent of the other party to the contract.

(17) Failing to establish, maintain, and enforce written policies and
procedures reasonably designed to prevent the misuse of material nonpublic
information in violation of Section 204A of the Investment Advisors Act of
1940

(18) Entering into, extending, or renewing any advisory contract which
would violate Section 205 of the Investment Advisers Act of 1940. This
provision shall apply to all advisers registered or required to be
registered under the Delaware Securities Act, notwithstanding whether such
adviser would be exempt from federal registration pursuant to Section
203(b) of the Investment Advisers Act of 1940.

(19) To include in an advisory contract any condition, stipulation, or
provision binding any person to waive compliance with any provision of the
Delaware Securities Act, any rule promulgated thereunder, the Investment
Advisers Act of 1940, or any rule promulgated thereunder, or to engage in
any other practice that would violate Section 215 of the Investment
Advisers Act of 1940.

(20) Engaging in any act, practice, or course of
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business which is fraudulent, deceptive, or manipulative in contravention
of Section 206(4) of the Investment Advisers Act of 1940, notwithstanding
the fact that such investment adviser is not registered or required to be
registered under Section 203 of the Investment Advisers Act of 1940.

(21) Engaging in any conduct, indirectly or through or by any other person,
which would be unlawful for such person to do directly under the provisions
of the Delaware Securities Act or any rule thereunder.

(22) Aiding or abetting any of the conduct listed above.

(b) The conduct set forth in subparagraph (a) of this Rule is not
exclusive. Engaging in other conduct such as forgery, embezzlement, theft,
exploitation, non-disclosure, incomplete disclosure or misstatement of
material facts, manipulative or deceptive practices, or aiding or abetting
any unethical practice, shall be deemed an unethical business practice and
shall also be grounds for denial, suspension or revocation of registration.
The federal statutory and regulatory provisions referenced herein shall
apply to all investment adviser representatives and federal covered
advisers, to the extent permitted by the National Securities Markets
Improvement Act of 1996 (Pub. L. No. 104-290).

CROSS-REFERENCE TO EXISTING REGULATIONS

Cross-Reference to Existing Rules and Regulations

Existing Rule Proposed

5 Registration by Coordination Repealed New Rule 400

5(a) Registration of Regulation A

offerings Repealed New Rule 402

5(c)(2) Time for Filing Repealed New Rule 400

5(c)(2)(A) Filing date Repealed

6 Registration by Qualification Repealed New Rule 401

6(A) Prospectus Repealed New Rule 401

6(b)(17) Additional information Repealed New Rule 401

6(e) Fees for registration by

qualification Revised New Rule 404

6(e)(A) Requests for rulings Revised New Rule 102(h)

7(c) Omissions Repealed

7(e) Reports during effectiveness Repealed

7(f) Investment companies' filings Repealed New Rule 403

7(g) Post-registration reports Repealed New Rule 405

8 Stop orders Repealed New Rules 260,

264, 265

9(a)(8) Exchange - Listing Revised New Rule 501

9(a)(13) NASDAQ listings Repealed

9(a)(13)(A) NASDAQ/National

Market System exemption Repealed New Rule 500

9(b)(2)(i) Recognized securities manuals Revised New Rule 508

9(b)(2)(ii) Removal of exemptions Repealed

9(b)(3) Unsolicited sales Renumbered New Rule 509

9(b)(9)(I) Private offering exemptions Repealed New Rule 502

9(b)(9)(II) Regulation D offerings Repealed New Rule 500

9(d) Exemption confirmation Revised New Rule 51012 Sales literature
Repealed New Rule 406

14(a) Application for registration as

A broker-dealer or an agent Revised New Rules 600,

601, 602

14(a)(A) Registration of investment

advisers Revised New Rules 700,

701

14(a)(2) Current information Revised New Rule 603

14(B) Examination Repealed New Rules 601,

602, 701

14(d) Net capital and aggregate

indebtedness Repealed New Rule 604

14(e) Surety bonds Repealed New Rule 605.

14(f) Registration under Section 7314(f) Repealed

14(f)(A) Registration of applicants for

Membership in NYSE,

ASE or in NASD Repealed

15(a)(A) Records of broker-dealers Repealed New Rule 606

15(a)(B) Records of broker-dealers Repealed New Rule 606

15(b) Financial reports required of

broker-dealers Repealed New Rule 605

18(a) Meaning of regulations under

Section 7318(a) Repealed

21 Escrow requirements Repealed

25(c) Publication of rules Repealed New Rule 102(g)

26(a) Central Registration Depository

System - Broker-dealer and

agent applicants Repealed New Rules 600,

601, 602

26(b) Administrative files Repealed New Rule 102(g)

73(l)(1) Hearing practices and

procedures Repealed New Rules 200-

272

DEPARTMENT OF LABOR

Division of Employment & Training

Governor's Advisory Council on Apprenticeship and Training

Statutory Authority: 19 Delaware Code, Section 202 (a) (19 Del.C. §202(a))

Notice of Proposed Rule Changes:

Summary:

The Governor's Council on Apprenticeship and Training proposes to recommend
rule changes at its regular meeting on March 10, 1998 at Buena Vista
Conference Center 661 South Dupont Highway, New Castle, DE 19720. Changes
are proposed to certain definitions in Sec. 106.2 including Administrator,
Apprentice, Full time, Apprenticeship Standards, Council, Delaware resident
contractor, On-site visit, Registrant or sponsor, and Registration
Supervisory inspection. In addition, changes are proposed to Sec. 106.3,
106.5, 106.6, 106.7

Comments:

Copies of the proposed rules are published in the Delaware Register of
Regulation and are on file at the Department of Labor, Division of
Employment and
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Training, 4425 N. Market Street, Wilmington, DE 19802 for inspection during
regular business hours. Copies are available upon request without charge.
Interested persons may submit comments in writing to the Governor's
Advisory Council on Apprenticeship and Training c/o Walt Purzycki at the
Department of Labor, Division of Employment and Training.

Public Hearing:

A public hearing on the changes will be held during the regular meeting of
the Council at 10:00 a.m. on March 10, 1998 at Buena Vista Conference
Center, 661 South Dupont Highway, New Castle, DE where interested persons
can present their views.

APPRENTICESHIP PROGRAMS

REGULATIONS AND STANDARDS

OF DELAWARE DEPARTMENT OF LABOR

DIVISION OF EMPLOYMENT AND TRAINING

OFFICE OF APPRENTICESHIP AND TRAINING

In cooperation with:

U.S. Department of Labor

Bureau of Apprenticeship & Training

INDEX

SECTION

NUMBER SECTION PAGE

106.1 Purpose and Scope 1

Declaration of Policy 2

106.2 Definitions 3

106.3 Eligibility and Procedure

for State Registration 8

106.4 Criteria For Apprenticeable

Occupations 12

106.5 Standards of Apprenticeship 13

106.6 Apprenticeship Agreement 23

106.7 Deregistration of State Registered

Program 25

106.8 Complaints 30

106.9 Hearing 30

106.10 Reinstatement of Program Registration 32

106.11 Program Registration Denial 33

106.12 Amendment to the Regulations

In This Part

* Please note that the above page numbers refer to the original document,
not to pages in the Register.

PURPOSE AND SCOPE

(A) Section 204, Chapter 2, Title 19, Delaware Code authorizes and directs
the Department of Labor to
formulate regulations to promote the furtherance of labor standards
necessary to safeguard the welfare of Apprentices and to extend the
applications of such standards by requiring their inclusion in
apprenticeship contracts.

(B) The purpose of this chapter is to set forth labor standards to
safeguard the welfare of Apprentices and to extend the application of such
standards by prescribing policies and procedures concerning the
registration of acceptable Apprenticeship Programs with the Delaware
Department of Labor.

(C) These labor standards and procedures cover the Registration and
Cancellation of Apprenticeship Agreements and of Apprenticeship Programs;
and matters relating thereto. Any questions [and/or] to request a copy of
Delaware's Prevailing Wage Regulations regarding the employment of
apprentices on state-funded construction projects must be referred to:

Delaware Department of Labor

Office of Labor Law Enforcement

4425 North Market Street

Wilmington, DE 19802

(302) 761-8200

DECLARATION OF POLICY

It is declared to be the policy of this State to:

(A) encourage the development of an apprenticeship and training system
through the voluntary cooperation of management and workers and interested
State agencies and in cooperation with other states and the federal
government;

(B) provide for the establishment and furtherance of Standards of
Apprenticeship and Training to safeguard the welfare of Apprentices and
trainees;

(C) aid in providing maximum opportunities for unemployed and employed
persons to improve and modernize their work skills; and

(D) contribute to a healthy economy by aiding in the development and
maintenance of a skilled labor force sufficient in numbers and quality to
meet the expanding needs of industry and to attract new industry.

SEC. 106.2 DEFINITIONS

As used in this part:

(A) "ADMINISTRATOR" refers to the Administrator of the Apprenticeship and
Training Section for the State Department of Labor.

"ADMINISTRATOR" refers to the Administrator of the Office of Apprenticeship
and Training for the State Department of Labor.

(B) "AGREEMENT" refers to a written agreement between an Apprentice and
either his/her employer or an Apprenticeship Committee acting as agent for
the
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Employer which contains the terms and conditions of the employment and
training of the Apprentice.

(C) "APPRENTICE" refers to a person at least sixteen years of age who is
engaged "FULL TIME" in learning a recognized skilled trade through actual
work experience under the supervision of Journeypersons. This person must
have entered into a written Apprenticeship Agreement with a registered
apprenticeship Sponsor. The training must be supplemented with properly
coordinated studies of related technical instruction.

"FULL TIME" refers to a position which is employed a minimum of forty (40)
hours per week, eight (8) hours per day in the classifications as stated in
the Apprenticeship Agreement under which the Apprentice is Registered. At
no time shall the Apprentice be employed at a job classification other than
those to which the Apprentice is Registered.

(D) "APPRENTICESHIP STANDARDS" refers to the document which embodies the
procedure for the selection and the training of apprentices, setting forth
the terms of the training, including wages, hours, conditions of
employment, training on the job, and related instruction. The duties and
responsibilities of the Sponsor, including administrative procedures, are
set forth in their company's policies.

(E) "BAT" refers to the U.S. Department of Labor, Bureau of Apprenticeship
and Training.

(F) "CANCELLATION" refers to the deregistration of a Program or the
Termination of an Agreement.

(G) "COMMITTEE" refers to those persons designated by the Sponsor to act on
its behalf in the administration of the Apprenticeship Program. A Committee
may be "joint" i.e., it is composed of an equal number of representatives
of the employer(s) and of the employee(s) represented by a bona fide
collective bargaining agent(s) and has been established to conduct, operate
or administer a Program and enter into Agreements with Apprentices. A
Committee may be "unilateral" or "non-joint" and shall mean a Program
Sponsor in which a bona fide collective bargaining agent is not a
participant.

(H) "COUNCIL" refers to the State's Governor's Advisory Council On
Apprenticeship and Training.

(I) "DELAWARE RESIDENT CONTRACTOR" includes any general contractor, prime
contractor, construction manager, subcontractor or other type of
construction contractor who regularly maintains a place of business in
Delaware. Regularly maintaining a place of business in Delaware does not
include site trailers, temporary structures associated with one contract or
set of related contracts, nor the holding, nor the maintaining of a post
office box within this State. The specific intention of this definition is
to maintain consistency with Title 30, Delaware Code, "Resident
Contractor".

(J) "DIRECTOR" refers to the Director of the Division of Employment and
Training.

(K) "DIVISION" refers to the Division of Employment and Training,
Department of Labor, state of Delaware.

(L) "EMPLOYER" refers to any person or organization employing an
Apprentice, whether or not such person or organization is a party to an
Apprenticeship Agreement.

(M) "JOURNEYPERSON" refers to a worker who is fully qualified as a skilled
worker in a given craft or trade.

(N) "ON-SITE VISIT" refers to a visit from a representative of the State of
Delaware, Department of Labor, Division of Employment and Training to the
office and/or the actual field job-site of the Sponsor, for the purposes of
inspecting and/or monitoring the progress and training of the Registered
Apprentice. This monitoring may include but is not limited to interviewing
the Apprentice and the auditing of pertinent documents relative to the
maintenance and enforcement of the terms of the Apprenticeship Agreement.

(O) "PROGRAM" refers to an executed apprenticeship plan which contains all
terms and conditions for the qualifications, recruitment, selection,
employment and training of Apprentices, including such matters as the
requirements for a written Apprenticeship Agreement.

(P) "REGISTRANT OR SPONSOR" refers to any person, association, committee or
organization in whose name or title the Program is (or is to be) registered
or approved regardless of whether or not such entity is an Employer. To be
eligible, the Registrant or Sponsor must be a "Delaware Resident
Contractor" or hold and maintain a "Delaware Resident Business License".
The Registrant or Sponsor must hold and maintain a permanent place of
business, not to include site trailers or other facilities serving only one
contract or related set of contracts. To be eligible to be a Registrant or
Sponsor, Employer/Business, association, committee or organization must
have the training program and an adequate number of Journey persons to meet
the ratio requirements as stated for that particular apprenticeable
occupation.

(Q) "REGISTRATION" refers to the acceptance and recording of an
Apprenticeship Program by the Delaware Department of Labor, Office of
Apprenticeship & Training, as meeting the basic standards and requirements
of the Division for approval of such Program. Approval is evidenced by a
Certificate or other written indicia documentation. Registration also
refers to the acceptance and recording of Apprenticeship Agreements
thereof, by the Delaware Department of Labor, Office of Apprenticeship &
Training as evidence of the participation of the Apprentice in a particular
Registered apprenticeship Program.
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(R) "RELATED INSTRUCTION" refers to a formal and systematic form of
instruction designed to provide the Apprentice with knowledge of the
theoretical and technical subjects related to his/her trade.

(S) "SECRETARY" refers to the Secretary of Labor.

(T) "STATE" refers to the state of Delaware

(U) "SUPERVISORY INSPECTION" shall mean the same as "ON SITE VISIT".

SEC. 106.3 ELIGIBILITY AND PROCEDURE FOR STATE REGISTRATION

(A) No Program or Agreement shall be eligible for State Registration unless
it is in conformity with the requirements of this chapter, and the training
is in an apprenticeable occupation having the characteristics set forth in
SEC. 106.4 herein.

(B) Apprentices must be individually registered under a Registered Program
with the State of Delaware, Department of Labor, Division of Employment and
Training. Such Registration shall be effected by filing copies of each
Agreement with the State. Sponsors registered with states other than the
State of Delaware shall not be construed as being registered for State of
Delaware Apprenticeship Program Registration purposes.

(C) The State must be properly notified through the proper office
Department of Labor, Division of Employment & Training, Office of
Apprenticeship & Training of cancellation, suspension or termination of any
Agreements, (with cause for same) and of apprenticeship completions. The
State will attempt, where applicable, to verify the cause of apprenticeship
termination.

(D) Approved Programs shall be accorded Registration, evidenced by a
Certificate of Registration. The Certificate of Registration for an
approved Program will be made in the name of the Program Sponsor and must
be renewed every four (4) years.

(E) Any modification(s) or change(s) to registered standards shall be
promptly submitted to the State through the appropriate office no later
than thirty (30) days and, if approved, shall be recorded and acknowledged
as an amendment to such standards.

(F) The request for registration and all documents and data required by
this chapter shall be submitted in triplicate. Individual Agreements shall
be submitted to the State Apprenticeship and Training Office for
Registration no later than thirty (30) calendar days after the trainee has
started work in the registered Program. Agreements submitted after said
time shall be considered a violation of the rules and regulations and will
not be honored.

(G) Under a Program proposed for Registration by an Employer or Employer's
Association, where the standards, collective bargaining agreement or other
instrument provides for participation by a union in any
way in the operation of the Program, and such participation is exercised,
written acknowledgment of a union agreement or "no objection" to the
Registration is required. Where no such participation is evidenced and
practiced, the Employer shall simultaneously furnish to the union a copy of
its Program application. In addition, upon receipt of the application for
the Program, the State shall promptly send by certified mail to such local
union another copy of the Program application and together with a notice
that union comments will be accepted for thirty (30) days after the date of
the agency transmittal.

(H) Where the employees to be trained have no collective bargaining agent,
a program plan may be proposed for Registration by an Employer or groups of
Employers.

(I) A Program may be Registered Sponsor may register Programs in one or
more occupations simultaneously or individually with the provision that the
Program Sponsor shall, within sixty (60) days of Registration, be actively
training Apprentices on the job, and related study must begin within twelve
(12) months for in each occupation for which Registration is granted. At no
time shall an individual Apprentice be employed in more than one (1)
occupation, nor signed to more than one (1) Apprenticeship Agreement at any
given time.

(J) Each occupation for which a Program Sponsor holds Registration shall be
subject to Cancellation if no active training of Apprentices on the job has
occurred within a consecutive one hundred eighty (180) day period, or if no
Related Instruction has begun within a twelve (12) month period from the
date of Registration or in any twelve (12) month period during the duration
of that Agreement.

(K)Each Sponsor of a Program shall submit to an on-site inspection or
supervisory visit and shall make all documents pertaining to the Registered
Program available to appropriate representatives of the Apprenticeship and
Training Office or designated service personnel upon request.

(L) Each Sponsor shall be so routinely examined , by the Office of
Apprenticeship and Training, at least annually, but not more than every six
(6) months, unless a specific violation is suspected or a specific document
is being investigated.

(M) The Sponsor shall notify the State Registration Agency of termination
or lay-off from employment of a Registered Apprentice or of the completion
of the terms of the Apprenticeship Agreement within thirty (30) calendar
days of such occurrence.

(N) The Sponsor shall notify the State of failure to obtain and register
the Apprentice in an approved course of Related Instruction as stated and
detailed on the Apprenticeship Agreement within (30) calendar days of such
occurence.
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(O) It shall be the responsibility of the Sponsor to monitor the progress
and attendance of the Apprentice in all phases of training such as, but not
limited to, on-the-job and/or Related Training.

SEC.106.4 CRITERIA FOR APPRENTICEABLE OCCUPATIONS

An APPRENTICEABLE occupation is a skilled trade which possesses all of the
following characteristics:

(A) It is customarily learned in a practical way through training and work
on the job.

(B) It is clearly identified and commonly recognized throughout the
industry, or recognized with a positive view towards changing technology or
approved by the Delaware Department of Labor, Office of Apprenticeship &
Training.

(C) It involves manual, technical or mechanical skills and knowledge which
require a minimum of two thousand (2,000) hours of on-the-job training, not
including the time spent in Related Instruction.

(D) It customarily requires Related Instruction to supplement the
on-the-job training.

(E) It involves the development of skills sufficiently broad enough to be
applicable in similar occupations throughout the industry, rather than a
restricted application to the products or services of any one company.

SEC. 106.5 STANDARDS OF APPRENTICESHIP

The following standards are prescribed for a Program.

(A) The Program must include an organized, written plan delineating the
terms and conditions of employment. The training and supervision of one or
more Apprentices in an apprenticeable occupation must become the
responsibility of the Sponsor who has undertaken to carry out the
Apprentice's training program.

(B) The standards must contain provisions concerning the following:

(1) The employment and training of the Apprentice in a skilled occupation;

(2) an equal opportunity pledge stating the recruitment, selection,
employment and training of Apprentices during their apprenticeships shall
be without discrimination based on: race, color, religion, national origin
or sex. When applicable, an affirmative action plan in accordance with the
State's requirements for federal purposes must be instituted;

(3) the existence of a term of apprenticeship, not less than one year or
two thousand (2,000) hours consistent with training requirements as
established by industry practice;

(4) an outline of the work processes in which the Apprentice will receive
supervised work experience and
on-the-job training, and the allocation of the approximate time to be spent
in each major process;

(5) provision for organized related and supplemental instruction in
technical subjects related to the trade. A minimum of one hundred
forty-four (144) hours for each year of apprenticeship is required. Such
instruction may be given in a classroom, through trade, industrial or
approved correspondence courses of equivalent value or in other forms
approved by the State Department of Labor; Office of Apprenticeship &
Training

(6) a progressively increasing schedule of wage rates to be paid the
Apprentice, consistent with the skill acquired which shall be expressed in
percentages of the established Journeyperson's hourly wage;

(7) Minimum Wage Progression for 1 through 7 year Apprentice Program as
follows:

1) 1 to 7 year programs

2) starting pay must be at least minimum wage

3) final period must be at least 85%

1 YEAR [OR] 2,000 HOUR APPRENTICESHIP PROGRAM:

1st 1,000 hours: 40%

2nd 1,000 hours: 85%

2 YEAR [OR] 4,000 HOUR APPRENTICESHIP PROGRAM:

1st 1,000 hours: 40%

2nd 1,000 hours: 51%

3rd 1,000 hours: 63%

4th 1,000 hours: 85%

3 YEAR [OR] 6,000 HOUR APPRENTICESHIP PROGRAM:

1st 1,000 hours: 40%

2nd 1,000 hours: 48%

3rd 1,000 hours: 57%

4th 1,000 hours: 65%

5th 1,000 hours: 74%

6th 1,000 hours: 85%

4 YEAR [OR] 8,000 HOUR APPRENTICESHIP PROGRAM:

1st 1,000 hours: 40%

2nd 1,000 hours: 46%

3rd 1,000 hours: 53%

4th 1,000 hours: 59%

5th 1,000 hours: 65%

6th 1,000 hours: 71%

7TH 1,000 hours: 78%

8th 1,000 hours: 85%

5 YEAR [OR] 10,000 HOUR APPRENTICESHIP PROGRAM:

1st 1,000 hours: 40%

2nd 1,000 hours: 45%

3rd 1,000 hours: 50%

4th 1,000 hours: 55%
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5th 1,000 hours: 60%

6th 1,000 hours: 65%

7TH 1,000 hours: 70%

8th 1,000 hours: 74%

9th 1,000 hours: 79%

10th 1,000 hours: 85%

6 YEAR [OR] 10,000 HOUR APPRENTICESHIP PROGRAM:

1st 1,000 hours: 40%

2nd 1,000 hours: 44%

3rd 1,000 hours: 48%

4th 1,000 hours: 52%

5th 1,000 hours: 56%

6th 1,000 hours: 60%

7TH 1,000 hours: 64%

8th 1,000 hours: 68%

9th 1,000 hours: 72%

10th 1,000 hours: 76%

11th 1,000 hours: 81%

12th 1,000 hours: 85%

7 YEAR [OR] 10,000 HOUR APPRENTICESHIP PROGRAM:

1st 1,000 hours: 40%

2nd 1,000 hours: 43%

3rd 1,000 hours: 47%

4th 1,000 hours: 50%

5th 1,000 hours: 54%

6th 1,000 hours: 57%

7TH 1,000 hours: 61%

8th 1,000 hours: 64%

9th 1,000 hours: 68%

10th 1,000 hours: 71%

11th 1,000 hours: 74%

12th 1,000 hours: 78%

13th 1,000 hours: 81%

14th 1,000 hours: 85%

(8) that the entry Apprentice wage rate shall not be less than the minimum
prescribed by State statute or by the Fair Labor Standards Act, where
applicable;

(9) That the established Journeyperson's hourly rate applicable among all
participating Employers be stated in dollars and cents. No Apprentice shall
receive an hourly rate less than the percentage for the period in which
he/she is serving applied to the established Journeyperson's rate unless
the Sponsor has documented the reason for same in the individual
Apprentice's progress report and has explained the reason for said action
to the Apprentice and Registration Agency.

In no case other than sickness or injury on the part of the Apprentice,
shall a Sponsor hold back an Apprentice's progression more than one period
or wage increment
without the written consent of the Administrator;

(10) That the established Journeyperson's rate provided for by the
Standards be reviewed and/or adjusted annually. Sponsors of Programs shall
be required to give proof that all employees used in determining ratios of
Apprentices to Journeypersons shall be receiving wages at least in the
amount set for Journeypersons in their individual program standards, or are
qualified to perform as Journey persons and must be paid at least the
minimum journeyperson rate;

(11) that the minimum hourly Apprentice wage rate paid during the last
period of apprenticeship not be less than eighty-five (85) percent of the
established Journeyperson wage rate. Wages covered by a collective
bargaining agreement takes precedent over this section. However, wages may
not be below the State's required minimum progression.

(C) The Program must include a periodic review and evaluation of the
Apprentice's progress in job performance and related instruction, and the
maintenance of appropriate progress records.

(D) The ratio of Apprentices to Journeypersons should be consistent with
proper supervision, training and continuity of employment or applicable
provisions in collective bargaining agreements. The ratio of Apprentices to
Journeypersons shall be one Apprentice to each five (5) Journeypersons
employed by the prospective Sponsor. More restrictive ratios will be
granted upon request. More liberal ratios may be granted only after the
requesting Sponsor has demonstrated that the number of Apprentices to be
trained shall be in relation to:

(1) the needs of the plant and/or trade in the community with consideration
for growth and expansion;

(2) the facilities and personnel available for training are adequate; and

(3) a reasonable opportunity that employment of skilled workers on
completion exists.

The following ratios will be recognized as standard for the trades of:

Apprentice up to Journeyperson

Carpenter 1 5

Plumber/Pipefitter 1 5

Sheet Metal Worker 1 4

Insulation Worker 1 4

Electrician 1 3

If a "collective bargaining agreement" exists and stipulates a ratio of
Apprentices to Journey persons, it shall prevail. Provided the Bargaining
Ratio is not lower than the State standard.

(E) At least forty (40) percent of all Apprentices registered must complete
training. Apprentices who voluntarily terminate their apprenticeships or
employment shall not be counted in reference to this section. Programs
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with fewer than five (5) Apprentices shall not be required to comply with
this part.

(F) A probationary period shall be in relation to the full apprenticeship
term with full credit toward completion of apprenticeship.

(G) Adequate and safe equipment facilities for training and supervision and
safety training for Apprentices on the job and in Related Instruction are
required.

(H) The required minimum qualifications for persons entering an Apprentice
Program as defined n Section 106.2(C) must be met.

(I) Apprentices must sign an Agreement. The Agreement shall directly, or by
reference, incorporate the standards of the Program as part of the
Agreement.

(J) Advance standing or credit up to one quarter 25% OJT hours of the
particular trade term in question for previously acquired experience,
training skills, or aptitude for all applicants equally, with commensurate
wages for any accorded progression step may be granted. The granting of a
greater amount of credit shall be set at the discretion of the
Administrator based on supportive documentation submitted by the Sponsor.
In no case shall more than one half of the particular trade term in
question be granted unless the time in question has been spent in an
approved State or Federally Registered Program.

(K) Transfer of Employer's training obligation through the sponsoring
Committee if one exists and as warranted, to another Employer with consent
of the Apprentice and the Committee or Program Sponsors, with full credit
to the Apprentice for satisfactory time and training earned, may be
afforded with written notice to, and approval of, the Registration Agency.

(L) These Standards shall contain a statement of assurance of qualified
training personnel.

(M) There will be recognition for successful completion of apprenticeship
evidenced by an appropriate certificate.

(N) These Standards shall contain proper identification of the Registration
Agency, being the Department of Labor, Division of Employment & Training,
Office of Apprenticeship & Training.

(O) There will be a provision for the Registration, Cancellation and
Deregistration of the Program, and a requirement for the prompt submission
of any modification or amendment thereto.

(P) There will be provisions for Registration of Agreements, modifications
and amendments, notice to the Division of persons who have successfully
completed Programs, and notice of Cancellations, suspensions and
terminations of Agreements an causes therefore.

(Q) There will be a provision giving authority for the termination of an
Agreement during the probationary period by either party without stated
cause.

(R) There will be provisions for not less than five (5) days notice to
Apprentices of any proposed adverse action and cause therefore with stated
opportunity to Apprentices during such period for corrective action. unless
other acceptable procedures are provided for in a collective bargaining
agreement.

(S) There will be provisions for a grievance procedure, and the name and
address of the appropriate authority under the program to receive, process
and make disposition of complaints.

(T) There will be provisions for recording and maintaining all records
concerning apprenticeships as may be required by the State or Federal law.

(U) There will be provisions for a participating Employer's Agreement.

(V) There will be funding formula providing for the equitable participation
of each participating Employer in funding of a group Program where
applicable.

(W) All Apprenticeship Standards must contain articles necessary to comply
with federal laws, regulations and rules pertaining to apprenticeship.

(X) Programs and Standards of Employers and unions in other than the
building and construction industry which jointly form a sponsoring entity
on a multi-state basis and are registered pursuant to all requirements of
this part by any recognized State apprenticeship agency shall be accorded
Registration of approval reciprocity by the Delaware Department of Labor if
such reciprocity is requested by the sponsoring entity. However,
reciprocity will not be granted in the Building and Construction industry
based on Title 29 CFR 29 Section 12(b) unless a "memorandum of
understanding" has been signed by individual state and the state of
Delaware.

SEC. 106.6 APPRENTICESHIP AGREEMENT

The Apprenticeship Agreement shall contain:

(A) the names and signatures of the contracting parties (Apprentice and the
program Sponsor or Employer), and the signature of a parent or guardian if
the Apprentice is a minor;

(B) the date of birth of the Apprentice;

(C) the name and address of the program Sponsor and the Registrant;

(D) the Apprentice's social security number;

(E) a statement of the trade or craft which the Apprentice is to be taught,
and the beginning date and term (duration) of apprenticeship;

(F) the number of hours to be spent by the Apprentice in work on the job;

(G) the number of hours to be spent in Related and Supplemental Instruction
is recommended to be not less than one hundred forty-four (144) hours per
year;

(H) provisions relating to a specific period of probation during which the
Apprenticeship Agreement
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may be terminated by either party to the Agreement upon written notice to
the Registrant;

(I) provisions that, after the probationary period, the Agreement may be
suspended, canceled or terminated for good cause, with due notice to the
Apprentice and a reasonable opportunity for corrective action, and with
written notice to the Apprentice and the Registrant of the final action
taken;

(J) a reference incorporating, as part of the Agreement, the standards of
the Apprenticeship Program as it exists on the date of the Agreement or as
it may be amended during the period of the Agreement;

(K) a statement that the Apprentice will be accorded equal opportunity in
all phases of apprenticeship employment and training without discrimination
based on race, color, religion, national origin, marital status, or sex, or
disability;

(L) a statement that, if an Employer is unable to fulfill his obligation
under his Agreement, the Agreement may, with consent of the Apprentice and
Committee, if one exists, be transferred to another Employer under a
Registered Program with written notice of the transfer to the Registrant,
and with full credit to the Apprentice for satisfactory time and training
earned;

(M) the name and address of the appropriate authority, if any, designated
under the program to receive, process and make disposition of controversies
or differences which cannot be adjusted locally or resolved in accordance
with the established trade procedure or applicable collective bargaining
provisions;

(N) a statement setting forth a schedule of work processes in the trade or
industry in which the Apprentice is to be trained and the approximate time
to be spent at each process;

(O) a statement of the graduated scale of wages to be paid the Apprentice
and whether or not the required school time shall be compensated;

(P) a statement that in the event the Registration of the Program has been
Canceled or revoked, the Apprentice will be notified within fifteen (15)
days of the event.

SEC. 106.7 DEREGISTRATION BY STATE

(A) Deregistration proceedings may shall be undertaken when the Program is
not conducted, operated or administered in accordance with the Registration
standards and the requirements of this chapter;

(B) Where it appears the Program is not being operated in accordance with
the Registered standards or with the requirements of the chapter, the
Administrator shall so notify the Program Registrant in writing;

(C) The notice shall be sent by registered or certified mail, return
receipt requested, and shall state the deficiency(s) or violation(s);

(D) It is declared to be the policy of this State to:

(1) deny the privilege of operation of a Program to persons who, by their
conduct and record, have demonstrated their indifference to the
aforementioned policies; and

(2) discourage repetition of violations of rules and regulations governing
the operation of Registered Apprenticeship Programs by individuals,
Sponsors, or Committees against the prescribed policies of the State, and
its political subdivisions, and to impose increased and added deprivation
of the privilege to operate Programs against those who have been found in
violation of these rules and regulations;

(3) deregister a Program either upon the voluntary action of the Registrant
by a request for cancellation of the Registration, or upon notice by the
State to the Registrant stating cause, and instituting formal
deregistration proceedings in accordance with the provisions of this
chapter;

(4) at the request of Sponsor, permit the Administrator to cancel the
Registration of a Program by a written acknowledgment of such request
stating, but not limited to, the following:

(a) the Registration is canceled at Sponsor's request and giving the
effective date of such cancellation.

(b) that, within fifteen (15) working days of the date of the
acknowledgment, the Registrant must notify all Apprentices of such
Cancellation and the effective date that such Cancellation automatically
deprives the Apprentice of his/her individual Registration.

(E) Any Sponsor who violates major provisions of the rules repeatedly, as
determined by the Administrator of Apprenticeship and Training (three or
more violations in any given twelve month period), shall be sent a notice
which shall contain the violations and will inform the Sponsor that the
Program will be placed in a probationary status for the next six (6) month
period. Any new major violations in this period shall constitute cause for
deregistration. In such a case, the Administrator shall notify the chairman
of the Apprenticeship and Training Council, who shall convene the Council.

The Sponsor in question will be notified of said meeting and may present
whatever facts, witnesses, etc., that the Sponsor deems appropriate. After
said hearing, the Council shall make a recommendation based on the facts
presented to the Secretary, as to whether the Program should be
deregistered. The Secretary's decision shall be final and binding on the
matter.

(F) Sponsors with fewer than three (3) violations shall be sent a notice by
registered or certified mail, return receipt requested, stating the
deficiencies found and the remedy required and shall state that the Program
will be deregistered for cause unless corrective action is taken within
thirty (30) days. Upon request by Registrant, the thirty (30) day period
may be extended for up to an
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additional thirty (30) day period.

(G) If the required action is not taken within the allotted time, the
Administrator shall send a notice to the Registrant by registered or
certified mail, return receipt requested, stating the following:

(1) this notice is sent pursuant to this subsection;

(2) that certain deficiencies were called to the Registrant's attention and
remedial action requested;

(3) based upon the stated cause and failure of remedy, the Program will be
deregistered, unless within fifteen (15) working days of receipt of this
notice, the Registrant requests a hearing;

(4) If a hearing is not requested by the Registrant, the Program will
automatically be deregistered.

(H) Every order of deregistration shall contain a provision that the
Registrant and State shall, within fifteen (15) working days of the
effective date of the order, notify all registered Apprentices of the
deregistration of the Program, the effective date, and that such action
automatically deprives the Apprentice of his/her individual Registration.

(I) Regulations concerning Apprentices "attendance and tardiness" policy
for related instruction.

(1) A registered Apprentice who misses seven (7) classes while enrolled in
a related studies program at any of the vocational schools in the three (3)
counties of the State of Delaware will be dropped from school. This will
result in their Apprenticeship Agreement being terminated by their Sponsor
and/or State Registration Agency.

(2) An absence will result when an Apprentice either arrives late or leaves
early three (3) times. However, School District Officials may bring to the
Administrator's attention, individual cases that may have experienced
extenuating circumstances. With the Administrator's approval, such
individuals may be granted exemption from this attendance policy.

(3) Courses of fewer sessions will be prorated. Instructors will inform
Apprentices of allowable absences.

(4) If you are a Registered Apprentice who is enrolled through a trade
union, trade society or any other organization that stipulates attendance
rules more stringent than the above, then you are required to follow those
regulations.

(5) Related Instruction that is delivered through a state approved
"in-house program", correspondence courses or other systems of equivalent
value will require the Apprentice to produce a document detailing
satisfactory participation and completion.

SEC.106.8 COMPLAINTS

(A) Any controversy or difference arising under an Agreement which cannot
be resolved locally, or which is not covered by a collective bargaining
agreement, may be
submitted by an Apprentice or his/her authorized representative to the
State Registration Agency for review. Matters covered by a collective
bargaining agreement, however, shall be submitted and processed in
accordance with the procedures therein provided.

(B) The complaint shall be in writing, signed by the complainant, and
submitted by the Apprentice or his/her authorized representative within
sixty (60) days of receipt of local decision. The complaint shall set forth
the specific problem, including all relevant facts and circumstances.
Copies of all pertinent documents and correspondence shall accompany the
complaint.

SEC.106.9 HEARINGS ON DEREGESTRATIONS

(A) Within ten (10) working days of a request for a hearing, the
Administrator or his/her assignee designee, shall give reasonable notice of
such hearing by registered mail, return receipt requested, to the
Registrant. Such notice shall include:

(1) the time and place of the hearing;

(2) a statement of the provisions of the chapter pursuant to which the
hearing is to be held;

(3) a statement of the cause for which the Program was deregistered and the
purpose of the hearing.

(B) The chairman of the Council on Apprenticeship and Training or his/her
designee shall conduct the hearing which shall be informal in nature. Each
party shall have the right to counsel, and the opportunity to present
his/her case fully, including cross-examination of witnesses as
appropriate.

(C) The Administrator shall make every effort to resolve the complaint and
shall render an opinion within ninety (90) days after receipt of the
complaint, based upon the record before him and an investigation, if
necessary. The Administrator shall notify, in writing, all parties of his
decision. If any party is dissatisfied or feels that they have been treated
unfairly by said decision, they may request a hearing by the Apprenticeship
and Training Council. Those provisions of the hearing process that are
applicable shall be followed and said Council shall make a determination on
the basis of the records and the proposed findings of the Administrator.
This determination shall be subject to review and approval by the
Secretary, whose decision shall be final.

SEC. 106.10 REINSTATEMENT OF PROGRAM REGISTRATION

A Program deregistered pursuant to this chapter may be reinstated upon
presentation of adequate evidence that the Program is operating in
accordance with this chapter. Such evidence shall be presented to the
Apprenticeship and Training Council, which shall make a recommendation
based on said evidence, past records and any other data deemed appropriate.
After such presentation, the Council
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shall make a recommendation to the Secretary as to whether the Program
should be reinstated. The Secretary's decision shall be final and binding.

SEC. 106.11 PROGRAM REGISTRATION DENIAL

Any proposed Sponsor may, within fifteen (15) working days, request a
hearing before the Apprenticeship and Training Council. If the proposed
Sponsor requests a hearing, the Administrator shall advise the chairman of
the Council, who shall convene the Council, for a hearing for the purpose
of making a determination on the basis of the record and proposed findings
of the Office of Apprenticeship & Training. This determination shall be
subject to review and approval by the Secretary, whose decision shall be
final and binding.

SEC. 106.12 AMENDMENT TO THE REGULATIONS IN THIS PART

The Secretary may, at any time upon his/her own motion or upon written
request of any interested person setting forth reasonable grounds
therefore, and after opportunity has been given to interested persons to
present their views, amend or revoke any of the terms of the regulations
contained in this part.

1994. However, Delaware's regulation was not adopted at that time.
Delaware's Transportation Conformity Regulation is modeled after the
federal guidelines and the federal guidelines have changed numerous times
since it was first proposed. Now that the federal rules are final, we are
proceeding with the development of Delaware's regulation.

3. POSSIBLE TERMS OF THE AGENCY ACTION: N/A

4. STATUTORY BASIS OR LEGAL AUTHORITY TO ACT:

7 Del. C. Chapter 60 Section 6010

Clean Air Act Amendments of 1990

5. OTHER REGULATIONS THAT MAY BE AFFECTED BY THE PROPOSAL:

6. NOTICE OF PUBLIC COMMENT: Public hearing to be held February 17, 1998 -
DNREC Auditorium, 89 Kings Highway, Dover DE, beginning at 5:00 p.m. For
further information, please contact Phil Wheeler at 739-4791

Transportation Conformity Regulation

Regulation No. 32

Proposed SIP Revision

TABLE OF CONTENTS

Section 1 - Purpose 1

Section 2 - Definitions 1

Section 3 - Applicability 6

Section 4 - Priority 8

Section 5 - Frequency of conformity

determinations 8

Section 6 - Consultation 10

Section 7 - Content of transportation plans 21

Section 8 - Relationship of transportation plan

and TIP conformity with the NEPA process 23

Section 9 - Fiscal constraints for transportation

plans and TIPs 23

Section 10 - Criteria and procedures for

determining conformity of

transportation plans, programs, and

projects: General 23

Section 11 - Criteria and procedures:

Latest planning assumptions 30

Section 12 - Criteria and procedures:

Latest emissions model 31

Section 13 - Criteria and procedures:

Consultation 32
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Department of Natural Resources & Environmental Control

Division of Air & Waste Management

Statutory Authority: 7 Delaware Code,

Section 6010 (7 Del.C. §6010)

1. TITLE OF THE REGULATIONS: Transportation Conformity - Regulation 32

2. BRIEF SYNOPSIS OF THE SUBJECT, SUBSTANCE AND ISSUES: Transportation
Conformity - Regulation 32. In keeping with the provisions of the Clean Air
Act, this regulation ensures that the State of Delaware's transportation
plans, programs and projects that get Federal money or approval conform to
the goals of the State Implementation Plan (SIP) to reduce auto emissions.
The proposed regulation requires that every time the State plans a project
that impacts air quality, an analysis must be done to determine if that
project will increase pollution over the amount predicted in the State
Implementation Plan, mentioned above.

Delaware's original proposed transportation conformity regulation was
presented for public hearing in November
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Section 14 - Criteria and procedures:

Timely implementation of TCMs 32

Section 15 - Criteria and procedures:

Currently conforming transportation

plan and TIP 33

Section 16 - Criteria and procedures:

Projects from a plan and TIP 33

Section 17 - Criteria and procedures: Localized

CO and PM10 violations (hot spots) 34

Section 18 - Criteria and procedures: Compliance

with PM10 control measures 35

Section 19 - Criteria and procedures: Motor

vehicle emissions budget 35

Section 20 - Criteria and procedures: Emission

reductions in areas without motor 39

vehicle emissions budgets 39

Section 21 - Consequences of control

strategy implementation plan failures 42

Section 22 - Requirements for adoption or

approval of projects by recipients of funds

designated under title 23 U.S.C or the

Federal Transit Laws 43

Section 23 - Procedures for determining

regional transportation-related emissions 44

Section 24 - Procedures for determining localized

CO and PM10 concentrations

(hot-spot analysis) 48

Section 25 - Using the motor vehicle emissions

budget in the applicable implementation

plan (or implementation plan submission). 51

Section 25 - Enforceability of design concept

and scope and project-level mitigation and

control measures 52

Section 27 - Exempt projects. 52

Section 28 - Projects exempt from regional emissions analyses 54

Section 29 - Traffic signal synchronization projects 55

* Please note that the above page numbers refer to the original document,
not to pages in the Register.

Section 1 - Purpose.

The purpose of this regulation is to implement §176(c) of the Clean Air Act
(CAA), as amended (42 U.S.C. 7401 et seq.), the related requirements of 23
U.S.C. 109(j), and regulations under 40 CFR Part 51 subpart T, with respect
to the conformity of transportation plans, programs, and projects which are
developed, funded, or approved by the United States Department of
Transportation (DOT), and by metropolitan planning organizations (MPOs) or
other recipients of funds under title 23 U.S.C. or the Federal Transit Laws
(49 U.S.C. Chapter 53). This regulation sets
forth policy, criteria, and procedures for demonstrating and assuring
conformity of such activities to this applicable implementation plan
developed and applicable pursuant to §110 and Part D of the CAA.

This regulation, consistent with 40 CFR Part 51, codifies and perhaps
simplifies a pre-existing spirit of cooperation, and is not intended to
undermine, duplicate or eliminate efforts already being undertaken within
the various Federal, State and local entities involved in this process.

Hereinafter, the short title for this regulation is the Transportation
Conformity Regulation.

Section 2 - Definitions.

Terms used but not defined in this regulation shall have the meaning given
them by the CAA, titles 23 and 49 U.S.C., other Environmental Protection
Agency (EPA) regulations, or other DOT regulations, in that order of
priority.

Adopt or approve of a regionally significant project, for the purposes of
Sections 6 and 30, means the first time any action necessary to authorize a
project occurs, such as any policy board action necessary for the project
to proceed, the issuance of administrative permits for the facility or for
construction of the facility, the execution of a contract to construct the
facility, any final action of a board, commission or administrator
authorizing or directing employees to proceed with construction of the
project, or any written decision or authorization from the MPO that the
project may be adopted or approved.

Applicable implementation plan is defined in §302(q) of the CAA and means
the portion (or portions) of the implementation plan, or most recent
revision thereof, which has been approved under §110, or promulgated under
§110(c), or promulgated or approved pursuant to regulations promulgated
under §301(d) and which implements the relevant requirements of the CAA.

CAA means the Clean Air Act, as amended.

Cause or contribute to a new violation for a project means:

(1) To cause or contribute to a new violation of a standard in the area
substantially affected by the project or over a region which would
otherwise not be in violation of the standard during the future period in
question, if the project were not implemented, or

(2) To contribute to a new violation in a manner that would increase the
frequency or severity of a new
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violation of a standard in such area.

Clean data means air quality monitoring data determined by EPA to meet the
requirements of 40 CFR part 58 that indicate attainment of the national
ambient air quality standard.

Control strategy implementation plan revision is the implementation plan
which contains specific strategies for controlling the emissions of and
reducing ambient levels of pollutants in order to satisfy CAA requirements
for demonstrations of reasonable further progress and attainment (CAA
§§182(b)(1), 182(c)(2)(A), 182(c)(2)(B), 187(a)(7), 189(a)(1)(B), and
189(b)(1)(A); and §§192(a) and 192(b), for nitrogen dioxide).

DelDOT means the Delaware Department of Transportation

Department means the Delaware Department of Natural Resources and
Environmental Control

Design concept means the type of facility identified by the project, e.g.,
freeway, expressway, arterial highway, grade-separated highway, reserved
right-of-way rail transit, mixed-traffic rail transit, exclusive busway,
etc.

Design scope means the design aspects which will affect the proposed
facility's impact on regional emissions, usually as they relate to vehicle
or person carrying capacity and control, e.g., number of lanes or tracks to
be constructed or added, length of project, signalization, access control
including approximate number and location of interchanges, preferential
treatment for high-occupancy vehicles, etc.

DOT means the United States Department of Transportation.

Dover/Kent County MPO is the regional metropolitan planning organization
for coordinating transportation planning in the Dover Urbanized area and
the balance of Kent County. Members of the MPO Council include the Delaware
Department of Transportation, the Delaware Transit Corporation, a
representative of the Governor of Delaware, the City of Dover, Kent County
municipalities and Kent County Levy Court. Membership in the MPO is
established by the MPO agreement and is subject to change.

EPA means the Environmental Protection Agency.

FHWA means the Federal Highway Administration of DOT.

FHWA/FTA project, for the purpose of this regulation, is any highway or
transit project which is proposed to receive funding assistance and
approval through the Federal-Aid Highway program or the Federal mass
transit program, or requires Federal Highway Administration (FHWA) or
Federal Transit Administration (FTA) approval for some aspect of the
project, such as connection to an interstate highway or deviation from
applicable design standards on the interstate system.

FTA means the Federal Transit Administration of DOT.

Forecast period with respect to a transportation plan is the period covered
by the transportation plan pursuant to 23 CFR part 450.

Highway project is an undertaking to implement or modify a highway facility
or highway-related program. Such an undertaking consists of all required
phases necessary for implementation. For analytical purposes, it must be
defined sufficiently to: (1) connect logical termini and be of sufficient
length to address environmental matters on a broad scope; (2) have
independent utility or significance, i.e., be usable and be a reasonable
expenditure even if no additional transportation improvements in the area
are made; and (3) not restrict consideration of alternatives for other
reasonably foreseeable transportation improvements.

Horizon year is a year for which the transportation plan describes the
envisioned transportation system according to Section 7 of this regulation.

Hot-spot analysis is an estimation of likely future localized CO and PM10
pollutant concentrations and a comparison of those concentrations to the
national ambient air quality standards. Hot-spot analysis assesses impacts
on a scale smaller than the entire nonattainment or maintenance area,
including, for example, congested roadway intersections and highways or
transit terminals, and uses an air quality dispersion model to determine
the effects of emissions on air quality.

Increase the frequency or severity means to cause a location or region to
exceed a standard more often or to cause a violation at a greater
concentration than previously existed and/or would otherwise exist during
the future period in question, if the project were not implemented.

Intermodal means the connection or interface between transportation modes
such as auto, train or bus

Lapse means that the conformity determination for a
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transportation plan or TIP has expired, and thus there is no currently
conforming transportation plan and TIP.

Maintenance area means any geographic region of the United States
previously designated nonattainment pursuant to the CAA Amendments of 1990
and subsequently redesignated to attainment subject to the requirement to
develop a maintenance plan under §175A of the CAA, as amended.

Maintenance plan means an implementation plan under §175A of the CAA, as
amended.

Metropolitan planning organization (MPO) is that organization designated as
being responsible, together with the State, for conducting the continuing,
cooperative, and comprehensive planning process under 23 U.S.C. 134 and 49
U.S.C. 5303. It is the forum for cooperative transportation
decision-making.

Milestone has the meaning given in §182(g)(1) and §189(c) of the CAA. A
milestone consists of an emissions level and the date on which it is
required to be achieved.

Motor vehicle emissions budget is that portion of the total allowable
emissions defined in the submitted or approved control strategy
implementation plan revision or maintenance plan for a certain date for the
purpose of meeting reasonable further progress milestones or demonstrating
attainment or maintenance of the NAAQS, for any criteria pollutant or its
precursors, allocated to highway and transit vehicle use and emissions.

Multimodal means a transportation planning system containing multiple
transportation modes.

National ambient air quality standards (NAAQS) are those standards
established pursuant to §109 of the CAA.

NEPA means the National Environmental Policy Act of 1969, as amended (42
U.S.C. 4321 et seq).

NEPA process completion, for the purposes of this regulation, with respect
to FHWA or FTA, means the point at which there is a specific action to make
a determination that a project is categorically excluded, to make a Finding
of No Significant Impact, or to issue a record of decision on a Final
Environmental Impact Statement under NEPA.

Nonattainment area means any geographic region of the United States which
has been designated as nonattainment under §107 of the CAA for any
pollutant for which a national ambient air quality standard exists.

Project means a highway project or transit project.

Protective finding means a determination by EPA that a submitted control
strategy implementation plan revision contains adopted control measures or
written commitments to adopt enforceable control measures that fully
satisfy the emissions reductions requirements relevant to the statutory
provision for which the implementation plan revision was submitted, such as
reasonable further progress or attainment.

Recipient of funds designated under title 23 U.S.C. or the Federal Transit
Laws means any agency at any level of State, county, city, or regional
government that routinely receives title 23 U.S.C. or Federal Transit Laws
funds to construct FHWA/FTA projects, operate FHWA/FTA projects or
equipment, purchase equipment, or undertake other services or operations
via contracts or agreements. This definition does not include private
landowners or developers, or contractors or entities that are only paid for
services or products created by their own employees.

Regionally significant project means a transportation project (other than
an exempt project) that is on a facility which serves regional
transportation needs (such as access to and from the area outside of the
region, major activity centers in the region, major planned developments
such as new retail malls, sports complexes, etc., or transportation
terminals as well as most terminals themselves) and would normally be
included in the modeling of a metropolitan area's transportation network,
including at a minimum all principal arterial highways and all fixed
guideway transit facilities that offer an alternative to regional highway
travel.

Safety margin means the amount by which the total projected emissions from
all sources of a given pollutant are less than the total emissions that
would satisfy the applicable requirement for reasonable further progress,
attainment, or maintenance.

Standard means a national ambient air quality standard.

Statewide transportation improvement program (STIP) means a staged,
multi-year, intermodal program of transportation projects covering the
State, which is consistent with the statewide transportation plan and
metropolitan transportation plans, and developed pursuant to 23 CFR part
450.

Statewide transportation plan means the official intermodal statewide
transportation plan that is developed through the statewide planning
process for the State, developed pursuant to 23 CFR part 450.
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Transit is mass transportation by bus, rail, or other conveyance which
provides general or special service to the public on a regular and
continuing basis. It does not include school buses or charter or
sightseeing services.

Transit project is an undertaking to implement or modify a transit facility
or transit-related program; purchase transit vehicles or equipment; or
provide financial assistance for transit operations. It does not include
actions that are solely within the jurisdiction of local transit agencies,
such as changes in routes, schedules, or fares. It may consist of several
phases. For analytical purposes, it must be defined inclusively enough to:
(1) connect logical termini and be of sufficient length to address
environmental matters on a broad scope; (2) have independent utility or
independent significance, i.e., be a reasonable expenditure even if no
additional transportation improvements in the area are made; and (3) not
restrict consideration of alternatives for other reasonably foreseeable
transportation improvements.

Transportation control measure (TCM) is any measure that is specifically
identified and committed to in the applicable implementation plan that is
either one of the types listed in §108 of the CAA, or any other measure for
the purpose of reducing emissions or concentrations of air pollutants from
transportation sources by reducing vehicle use or changing traffic flow or
congestion conditions. Notwithstanding the above, vehicle technology-based,
fuel-based, and maintenance-based measures which control the emissions from
vehicles under fixed traffic conditions are not TCMs for the purposes of
this regulation.

Transportation improvement program (TIP) means a staged, multiyear,
intermodal program of transportation projects covering a metropolitan
planning area which is consistent with the metropolitan transportation
plan, and developed pursuant to 23 CFR part 450.

Transportation plan means the official intermodal metropolitan
transportation plan that is developed through the metropolitan planning
process for the metropolitan planning area, developed pursuant to 23 CFR
part 450.

Transportation project is a highway project or a transit project.

U.S.C. means the United States Code

WILMAPCO, the Wilmington Area Planning Council, as designated by the
Governors of Delaware and Maryland,
is the MPO for New Castle County, Delaware and Cecil County, Maryland.
Within the framework of Federal law and regulation, it serves as the
transportation planning coordinating agency for the two-county WILMAPCO
region, and its policies are established by the WILMAPCO Council, whose
members are a representative of the Governors of Delaware and Maryland; the
Delaware Secretary of Transportation, the Director of the Delaware Transit
Corporation, the Mayor of Wilmington, the County Executive of New Castle
County, New Castle and Cecil Counties Municipalities' representatives, and
Cecil County President Commissioner.

Written commitment for the purposes of this regulation means a written
commitment that includes a description of the action to be taken; a
schedule for the completion of the action; a demonstration that funding
necessary to implement the action has been authorized by the appropriating
or authorizing body; and an acknowledgment that the commitment is an
enforceable obligation under the applicable implementation plan.

Section 3 - Applicability.

(a) Action applicability.

(1) Except as provided for in paragraph (c) of this section, conformity
determinations are required for:

(i) The adoption, acceptance, approval or support of transportation plans
and transportation plan amendments developed pursuant to 23 CFR part 450 or
49 CFR part 613 by an MPO or DOT;

(ii) The adoption, acceptance, approval or support of TIPs and TIP
amendments developed pursuant to 23 CFR part 450 or 49 CFR part 613 by an
MPO or DOT; and

(iii) The approval, funding, or implementation of FHWA/FTA projects.

(2) Conformity determinations are not required under this regulation for
individual projects which are not FHWA/FTA projects. However, Section 22
applies to such projects if they are regionally significant.

(3) Conformity determinations for Cecil County, Maryland shall be conducted
in accordance with conformity procedures established in the Code of
Maryland regulations (COMAR) and in the Maryland State Implementation Plan.

(b) Geographic Applicability. The provisions of this regulation shall apply
in all nonattainment and maintenance areas for transportation-related
criteria pollutants for which the area is designated nonattainment or has a
maintenance plan.

(1) The provisions of this regulation apply with
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respect to emissions of the following criteria pollutants: ozone, carbon
monoxide (CO), nitrogen dioxide (NO2), and particles with an aerodynamic
diameter less than or equal to a nominal 10 micrometers (PM10).

(2) The provisions of this regulation apply with respect to emissions of
the following

precursor pollutants:

(i) Volatile organic compounds (VOC) and nitrogen oxides (NOx) in ozone
areas;

(ii) NOx in NO2 areas; and

(iii) VOC, NOx, and PM10 in PM10 areas if the EPA Regional Administrator or
the director of the State air agency has made a finding that
transportation- related precursor emissions within the nonattainment area
are a significant contributor to the PM10 nonattainment problem and has so
notified the MPO and DOT, or if the applicable implementation plan (or
implementation plan submission) establishes a budget for such emissions as
part of the reasonable further progress, attainment or maintenance
strategy.

(3) The provisions of this regulation apply to maintenance areas for 20
years from the date EPA approves the area's request under §107(d) of the
CAA for redesignation to attainment, unless the applicable implementation
plan specifies that the provisions of this regulation shall apply for more
than 20 years.

(c) Limitations.

(1) Projects subject to this regulation for which the NEPA process and a
conformity determination have been completed by DOT may proceed toward
implementation without further conformity determinations unless more than
three years have elapsed since the most recent major step (NEPA process
completion; start of final design; acquisition of a significant portion of
the right-of-way; or approval of the plans, specifications and estimates)
occurred. All phases of such projects which were considered in the
conformity determination are also included, if those phases were for the
purpose of funding final design, right-of-way acquisition, construction, or
any combination of these phases.

(2) A new conformity determination for the project will be required if
there is a significant change in project design concept and scope, if a
supplemental environmental document for air quality purposes is initiated,
or if three years have elapsed since the most recent major step to advance
the project occurred.

(d) Grace period for new nonattainment areas. For areas or portions of
areas which have been designated attainment for either ozone, CO, PM10 or
NO2 since 1990 and are subsequently redesignated to nonattainment for any
of these pollutants, the provisions of this regulation shall not apply for
12 months following the date of final
designation to

nonattainment for such pollutant.

(e) Should any county become nonattainment for the pollutants described in
Sections 17, 18, and 24, these applicable sections shall become effective
twelve (12) months after notification of such nonattainment status from EPA
to the State.

Section 4 - Priority.

When assisting or approving any action with air quality-related
consequences, FHWA and FTA shall give priority to the implementation of
those transportation portions of an applicable implementation plan prepared
to attain and maintain the NAAQS. This priority shall be consistent with
statutory requirements for allocation of funds among States or other
jurisdictions.

Section 5 - Frequency of Conformity Determinations.

(a) Conformity determinations and conformity redeterminations for
transportation plans, TIPs, and FHWA/FTA projects must be made according to
the requirements of this section and the applicable implementation plan.

(b) Frequency of conformity determinations for transportation plans.

(1) Each new transportation plan must be demonstrated to conform before the
transportation plan is approved by the MPO or accepted by DOT.

(2) All transportation plan revisions must be found to conform before the
transportation plan revisions are approved by the MPO or accepted by DOT,
unless the revision merely adds or deletes exempt projects listed in
Sections 27 or 28. The conformity determination must be based on the
transportation plan and the revision taken as a whole.

(3) The MPO and DOT must determine the conformity of the transportation
plan no

less frequently than every three years. If more than three years elapse
after DOT's conformity determination without the MPO and DOT determining
conformity of the transportation plan, the existing conformity
determination will lapse.

(c) Frequency of conformity determinations for transportation improvement
programs.

(1) A new TIP must be demonstrated to conform before the TIP is approved by
the MPO or accepted by DOT.

(2) A TIP amendment requires a new conformity determination for the entire
TIP before the
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amendment is approved by the MPO or accepted by DOT, unless the amendment
merely adds or deletes exempt projects listed in Sections 27 or 28.

(3) The MPO and DOT must determine the conformity of the TIP no less
frequently than every three years. If more than three years elapse after
DOT's conformity determination without the MPO and DOT determining
conformity of the TIP, the existing conformity determination will lapse.

(4) After an MPO adopts a new or revised transportation plan, conformity of
the TIP must be redetermined by the MPO and DOT within six months from the
date of DOT's conformity determination for the transportation plan, unless
the new or revised plan merely adds or deletes exempt projects listed in
Sections 27 or 28. Otherwise, the existing conformity determination for the
TIP will lapse.

(d) Projects. FHWA/FTA projects must be found to conform before they are
adopted, accepted, approved, or funded. Conformity must be redetermined for
any FHWA/FTA project if three years have elapsed since the most recent
major step to advance the project (NEPA process completion; start of final
design; acquisition of a significant portion of the right-of-way; or
approval of the plans, specifications and estimates) occurred.

(e) Triggers for transportation plan and TIP conformity determinations.
Conformity of existing transportation plans and TIPs must be redetermined
within 18 months of the following, or the existing conformity determination
will lapse, and no new project-level conformity determinations may be made
until conformity of the transportation plan and TIP has been determined by
the MPO and DOT:

(1) November 24, 1993;

(2) The date of the State's initial submission to EPA of each control
strategy implementation plan or maintenance plan establishing a motor
vehicle emissions budget;

(3) EPA approval of a control strategy implementation plan revision or
maintenance plan which establishes or revises a motor vehicle emissions
budget;

(4) EPA approval of an implementation plan revision that adds, deletes, or
changes TCMs; and

(5) EPA promulgation of an implementation plan which establishes or revises
a motor vehicle emissions budget or adds, deletes, or changes TCMs.

Section 6 - Consultation

(a) General.

This regulation provides procedures for interagency consultation (Federal,
State, and local) and resolution of
conflicts. Such consultation procedures shall be undertaken by WILMAPCO,
DelDOT and DOT with the Department and EPA before making conformity
determinations, and by the Department and EPA with WILMAPCO, the Dover/Kent
County MPO, DelDOT, and DOT in developing applicable implementation plans.

(b) Interagency consultation procedures: General factors.

(1) Agency representation, roles and responsibilities.

(i) Representatives of WILMAPCO, the Dover/Kent County MPO, the Department
and DelDOT shall undertake an interagency consultation process in
accordance with this section and with local or regional offices of EPA,
FHWA, and FTA on the development of the implementation plan, the list of
TCMs in the applicable implementation plan, the unified planning work
program under 23 CFR § 450.314, the transportation plan, the TIP, any
revisions to the preceding documents, and all conformity determinations
required by this regulation.

(ii) The Department shall be the lead agency responsible for assuring the
adequacy of the interagency consultation process with respect to the
development of applicable implementation plans and control strategy
implementation plan revisions and the credits associated with the list of
TCMs in the applicable implementation plan. In their respective areas,
WILMAPCO or the Dover/Kent County MPO shall be the lead agency responsible
for preparing the final document or decision and for assuring the adequacy
of the interagency consultation process with respect to the development of
the unified planning work program under 23 CFR § 450.314, the
transportation plan, the TIP, and any amendments or revisions thereto. In
the case of non-metropolitan areas, DelDOT shall be the lead agency
responsible for preparing the final document or decision and for assuring
the adequacy of the interagency consultation process with respect to the
development of the Statewide transportation plan, the STIP, and any
amendments or revisions thereto. The Dover/Kent County MPO and WILMAPCO
shall be the lead agency responsible for preparing the final document or
decision and for assuring the adequacy of the interagency consultation
process with respect to any determinations of conformity under this
regulation for which the MPO is responsible.

(iii) In addition to the lead agencies identified in subparagraph (ii),
other agencies entitled to participate in any interagency consultation
process under this regulation include DelDOT, the Department of Public
Safety, WILMAPCO and the Dover/Kent County MPO, the Federal Highway
Administration regional office and State division office, the Federal
Transit Administration regional office, the US Environmental Protection
Agency,
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the Maryland Department of the Environment, the Maryland Department of
Transportation, the Department, and any local transportation agency or
local government.

(iv) It shall be the role and responsibility of each lead agency in an
interagency consultation process, as specified in subparagraph (ii), to
confer with all other agencies identified under subparagraph(iii) with an
interest in the document to be developed, provide all appropriate
information to those agencies needed for meaningful input, solicit early
and continuing input from those agencies, conduct the consultation process
described in the applicable paragraphs of Section 6 (b), where required,
assure policy-level contact with those agencies, and, (except for actions
subject to Section 6 (b)(7) or (c)(1)(vii)) prior to taking any action,
consider the views of each such agency and respond to those views submitted
in a timely, substantive written manner prior to any final decision on such
document, and assure that such views and written response are made part of
the record of any decision or action. It shall be the role and
responsibility of each agency specified in subparagraph (C), when not
fulfilling the role and responsibilities of a lead agency, to confer with
the lead agency and other participants in the consultation process, review
and provide written comments on all proposed and final documents and
decisions in a timely manner, attend consultation and decision meetings,
assure policy-level contact with other participants, provide input on any
area of substantive expertise or responsibility (such as planning
assumptions, modeling, information on status of TCM implementation, and
interpretation of regulatory or other requirements), and provide technical
assistance to the lead agency or consultation process in accordance with
this paragraph when requested.

(v) Specific roles and responsibilities of various participants in the
interagency consultation process shall be as follows:

(A) The Department shall be responsible for developing:

(I) emissions inventories,

(II) emissions budgets,

(III) air quality modeling,

(IV) attainment demonstrations, (V) control strategy implementation plan
revisions,

(VI) updated motor vehicle emissions factors, and

(VII) involving the WILMAPCO, the Dover/Kent County MPO or DelDOT
continuously in the process;

(B) The Dover/Kent County MPO and/or WILMAPCO shall be responsible, for:

(I) developing transportation plans, UPWPs and TIPs,

(II) evaluating TCM impacts based on technical support provided by DelDOT,

(III) approving transportation and socioeconomic data and planning
assumptions and providing such data and planning assumptions to the
Department and DelDOT for use in air quality analysis to determine
conformity of transportation plans, TIPs, and projects,

(IV) monitoring implementation of regionally significant projects as
identified in the TIP;

(V) approving TCMs,

(VI) providing input to policy decisions on emissions budgets assuring the
proper and timely completion of transportation modeling, regional emissions
analyses and documentation of timely implementation of TCMs needed for
conformity assessments.

(C) DelDOT shall be responsible for:

(I) developing Statewide transportation plans and STIPs,

(II) providing technical comments on motor vehicle emissions inputs,

(III) distributing draft and final air quality documents to other agencies,

(IV) convening air quality technical review meetings on specific projects
when requested by other agencies or as necessitated by changes in schedule
or scope,

(V) provide timely demand forecasting and on-road mobile source emission
inventories, and

(VI) involve WILMAPCO, the Dover/Kent County MPO and the Department
continuously in the Consultation Process as described in this section;

(D) The Department of Public Safety, Division of Motor Vehicles shall be
responsible for providing data such as motor vehicle registration data for
use in the on-road mobile source emissions model;

(E) FHWA and FTA shall be responsible for:

(I) assuring timely action on final findings of conformity, after
consultation with other agencies as provided in this section and 40 CFR
§ 51.402, and

(II) provide guidance on conformity and the transportation planning process
to agencies in interagency consultation; and

(F) EPA shall be responsible for:

(I) reviewing and approving updated motor vehicle emissions factors, and

(II) providing guidance on conformity criteria and procedures to agencies
in interagency consultation.

(2) CONSULTATION PROCESS WORK GROUP - procedures
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(i) As described herein, various agencies have the primary responsibility
as lead agency for the preparation, development, and/or performance of the
various tasks required as part of the conformity and attainment processes.
These agencies shall form a CONSULTATION PROCESS WORK GROUP (Work Group).
As part of the consultation process described herein, it shall be the
affirmative obligation of each such lead agency having the responsibility
for preparation of a final document as set forth in this section to
initiate the consultation process by notifying other participants and
convening a PRODUCT DEVELOPMENT TASK FORCE (Task Force) composed of the
other members of the Work Group. Such Task Force shall be chaired by the
representative of the lead agency, unless the group, by consensus, selects
another chair. Each such Task Force will begin consultation meetings early
in the process of developing the final document, and shall prepare all
drafts and final documents and major supporting documents, or appoint the
representatives or agencies that will prepare such documents. The Work
Group and each Task Force shall be made up of policy level representatives
or their designees and shall be assisted by such technical committees or
technical engineering, planning, public works, air quality and
administrative staff of member agencies as the Work Group deems
appropriate. The chair of each Task Force shall appoint the conveners of
technical meetings and shall be responsible for the ongoing and continuous
process described herein. The lead agency shall assure that all relevant
documents and information are supplied to all participants in the informal
and formal consultation process in a timely manner.

In the event that an agency member of the Work Group or Task Force other
than the lead agency would like to convene the Work Group or Task Force,
either in a formal or informal session to discuss any matter concerning or
related to this regulation, said agency shall notify the lead agency of its
specific request and the lead agency shall, within seven (7) days, convene
a session of the Work Group or Task Force.

(ii) Regular consultation on major activities such as the development of an
implementation plan revision, the development of a transportation plan, the
development of a TIP, or any determination of conformity of transportation
plans or TIPs, shall include meetings of the Work Group on a regular
scheduled basis as shall be determined by the consensus of the work group,
but no less than on a semi-annual basis, until an attainment demonstration
is approved by EPA.

(iii) At each meeting of the Work Group, the following shall be reviewed
and approved:

(A) The schedule for all formal meetings;

(B) The status and schedule for delivery of
all documents, materials or products required to be developed by these
regulations;

(C) The status and schedule of all Standing Committee and/or Sub-Committee
activities;

(D) All Public Meetings, Hearings and/or other public involvement.

(iv) The Work Group may establish Standing Sub-Committees or Sub-Committees
of limited duration when the Work Group determines that such are necessary
to accomplish specific objectives or tasks.

(v) As described in this section, various agencies have the primary
obligation for the preparation, development, performance and/or the
responsibility (legal or otherwise) to be the lead agency for the various
tasks required as part of the conformity-attainment process. It shall be
the affirmative responsibility of each such lead agency to involve each of
the other agencies, on an informal basis and in an ongoing, continuous
manner in the said preparation, development, performance, etc., as
frequently as possible without detracting from said agency's ability to
complete the task.

(3) Each lead agency for any Task Force or Sub-Committee, as part of the
interagency consultation process under this section (including any Federal
agency) shall provide each final document that is the product of such
consultation process (including applicable implementation plans or
implementation plan revisions, transportation plans, TIPs, and
determinations of conformity), together with all supporting information, to
each other agency that has participated in the consultation process within
30 calendar days of adopting or approving such document or making such
determination. Any such agency may supply a checklist of available
supporting information, which such other participating agencies may use to
request all or part of such supporting information, in lieu of generally
distributing all supporting information.

(4) A meeting that is scheduled or required for another purpose may be used
for the purposes of consultation if the conformity consultation purpose is
identified in the public notice for the meeting.

(c) Interagency consultation procedures: Specific processes

(1) An interagency consultation process in accordance with paragraph (b)
shall be undertaken for the following:

(i) Evaluating and choosing each model (or models) and associated methods
and

(ii) Determining and providing written notification to the affected
agencies (i.e., by letter from the Chairman to be included in the
documentation) which minor arterials and other transportation projects
should be considered "regionally significant" for the purposes of regional
emissions analysis (in addition to those functionally classified as
principal arterial or higher or
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fixed guideway systems or extensions that offer an alternative to regional
highway travel), and which projects should be considered to have a
significant change in design concept and scope from the transportation plan
or TIP, to be initiated by DelDOT and conducted in accordance with
paragraph (b)(2) of this section;

(iii) Evaluating whether projects otherwise exempted from meeting the
requirements of this regulation (see Sections 27 and 28) should be treated
as non-exempt in cases where potential adverse emissions impacts may exist
for any reason, to be initiated by DelDOT and conducted in accordance with
paragraph (b)(2) of this section;

(iv) Making a determination, as required by Section 14(c)(1), whether past
obstacles to implementation of TCMs which are behind the schedule
established in the applicable implementation plan have been identified and
are being overcome, and whether State and local agencies with influence
over approvals or funding for TCMs are giving maximum priority to approval
or funding for TCMs, to be initiated by DelDOT and conducted in accordance
with paragraph (b)(2) of this section. This consultation process shall also
consider whether delays in TCM implementation necessitate revisions to the
applicable implementation plan to remove TCMs or substitute TCMs or other
emission reduction measures;

(v) Making a determination, as required by Section 22(b), whether a project
should be included in the regional emissions analysis supporting the TIP's
conformity determination, even if the project is not strictly included in
the TIP for the purposes of MPO project selection or endorsement, and
whether the project's design concept and scope have not changed
significantly from those which were included in the regional emissions
analysis, or in a manner which would significantly impact use of the
facility, to be initiated by DelDOT and conducted in accordance with
paragraph (b)(2) of this section.

(vi) Identifying, as required by Section 24(d), projects located at sites
in PM10 nonattainment areas which have vehicle and roadway emission and
dispersion characteristics which are essentially identical to those at
sites which have violations verified by monitoring, and therefore require
quantitative PM10 hot-spot analysis, to be initiated by DelDOT and
conducted in accordance with paragraph (b)(2);

(vii) Notification of transportation plan or TIP revisions or amendments
which merely add or delete exempt projects listed in Section 27, to be
initiated by WILMAPCO, the Dover/Kent County MPO, or DelDOT in their
respective areas, and conducted in accordance with paragraph (b)(2) of this
section, other than the requirement that such notice be provided prior to
final action;

(viii) Determining what forecast of vehicle miles traveled (VMT) to use in
establishing or tracking emissions budgets, developing transportation
plans, TIPs, or applicable implementation plans, or making conformity
determinations, to be initiated by DelDOT and conducted in accordance with
paragraph (b)(2) of this section;

(ix) Determining what constitutes "reasonable professional practice" for
the purposes of Sections 23 and 24(b), within the context thereof, to be
initiated by DelDOT and conducted in accordance with paragraph (b)(2) of
this section.

(x) Determining whether the project sponsor or MPO has demonstrated that
the requirements of Sections 19, 24 and 25 are satisfied without a
particular mitigation or control measure, as provided in Section 26(d), to
be initiated by the Department and conducted in accordance with paragraph
(b)(2) of this section;

(xi) Any decision made under paragraph (c)(1) of this section shall be
conveyed in writing to all member agencies.

(2) An interagency consultation process in accordance with paragraph (b) of
this section shall be undertaken for the following:

(i) Evaluating events which will require new conformity determinations in
addition to those triggering events established in Section 5, to be
initiated by WILMAPCO, the Dover/Kent County MPO, or DelDOT in their
respective areas, and conducted in accordance with paragraph (b)(2) of this
section;

(ii) Consulting on emissions analysis for transportation activities which
cross the borders of MPOs, or nonattainment areas, to be initiated by
WILMAPCO, the Dover/Kent County MPO, or DelDOT in their respective areas,
and conducted in accordance with paragraph (b)(2) of this section.

(3) Where the metropolitan planning area does not include the entire
nonattainment or maintenance area, an interagency consultation process in
accordance with paragraph (b) of this section involving the MPO and the
State Department of Transportation shall be undertaken for cooperative
planning and analysis for purposes of determining conformity of all
projects outside the metropolitan area and within the nonattainment or
maintenance area, to be initiated by WILMAPCO and/or the Dover/Kent County
MPO in their respective areas, and conducted in accordance with paragraph
(b)(2) of this section.

(4) Regionally significant project - policy and procedures

(i) An interagency consultation process in accordance with paragraph (b)
and including recipients of funds designated under title 23 U.S.C. or the
Federal Transit Act shall be undertaken to assure that plans for
construction of regionally significant projects which are
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not FHWA/FTA projects (including projects for which alternative locations,
design concept and scope, or the no-build option are still being
considered), including all those by recipients of funds designated under
title 23 U.S.C. or the Federal Transit Act are disclosed to the MPO on a
regular basis, and are included in the TIP.

(ii) The sponsor of any such regionally significant project, and any agency
that is responsible for taking action(s) on any such project (or otherwise)
shall disclose such project to the MPO in a timely manner. Such disclosure
shall be made not later than the first occasion on which any of the
following actions is sought: any policy board action necessary for the
project to proceed, the issuance of administrative permits for the facility
or for construction of the facility, the execution of a contract to design
or construct the facility, the execution of any indebtedness for the
facility, any final action of a board, commission or administrator
authorizing or directing employees to proceed with design, permitting or
construction of the project, or the execution of any contract to design or
construct or any approval needed for any facility that is dependent on the
completion of the regionally significant project. To help assure timely
disclosure, the sponsor of any potential regionally significant project
shall disclose to the MPO annually, not later than June 1 for the TIP
currently being developed each year, each project for which alternatives
have been identified through the NEPA process, and in particular, any
preferred alternative that may be a regionally significant project.

(iii) In the case of any such regionally significant project that has not
been disclosed to the MPO and other interested agencies participating in
the consultation process in a timely manner, such regionally significant
project shall not be considered to be included in the regional emissions
analysis supporting the currently conforming TIP's conformity determination
and not to be consistent with the motor vehicle emissions budget in the
applicable implementation plan, for the purposes of Section 22.

(5) An interagency consultation process in accordance with paragraph (b) of
this section involving the MPO and other recipients of funds designated
under title 23 U.S.C. or the Federal Transit Act shall be undertaken for
developing assumptions regarding the location and design concept and scope
of projects which are disclosed to the MPO as required by paragraph (c)(4)
of this section but whose sponsors have not yet decided these features, in
sufficient detail to perform the regional emissions analysis according to
the requirements of Section 23, to be initiated by DelDOT and conducted in
accordance with paragraph (b)(2) of this section.

(6) An interagency consultation process in accordance with paragraph (b) of
this section shall be undertaken for
the design, schedule, and funding of research and data collection efforts
related to regional transportation model development (such as household/
travel transportation surveys), to be initiated by DelDOT and conducted in
accordance with paragraph (b)(2) of this section.

(d) Submittal process for determinations and amendments

Conformity is an affirmative responsibility of the Federal agency
supporting the action. This final determination will be based on
information developed by WILMAPCO, the Dover/Kent County MPO, or DelDOT in
their respective areas, but FHWA/FTA will make an independent
determination.

To accomplish this determination, the following procedures must be
followed:

(1) The completed air quality conformity determination, necessary
supporting documentation and the TIP will be submitted to the FHWA Division
Office and the FTA Regional Office. The FHWA Division Office will forward a
copy of the conformity determination and TIP (including both highway and
transit projects) to the EPA Regional Office for review and comment. EPA
will respond in writing, to the FTA Regional Office and FHWA Division
Office, as soon as possible but not later than 30 days from the date of the
FHWA transmittal.

(2) EPA comments will be resolved by FHWA and FTA, in concert with EPA,
with WILMAPCO, the Dover/Kent County MPO, or DelDOT in their respective
areas, as necessary.

(3) FHWA and FTA will jointly prepare correspondence to make the conformity
finding. Joint conformity findings will be addressed to WILMAPCO (with a
copy to DelDOT), to the Dover/Kent County MPO (with a copy to DelDOT), or
to DelDOT in their respective areas, with copies to EPA and FTA. The
findings of FTA and FHWA together constitute the DOT conformity findings.

(4) The FHWA Division Office will send a copy of the signed conformity
determination and the TIPs to the Regional Office.

(5) In the event that WILMAPCO, the Dover/Kent County MPO, or DelDOT in
their respective areas, wishes to amend the TIP to add projects that are
exempt from the conformity analysis requirement, FHWA or FTA or both, if
necessary, will concur in the amendment and re-affirm the original DOT
conformity finding by letter. This re-affirmation letter will reference the
date(s) of the original FHWA and FTA findings. In cases where the amendment
involves projects that are not exempt, a new conformity analysis and
determination will be required from WILMAPCO, the Dover/Kent County MPO, or
DelDOT
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in their respective areas, and will, in turn, require a new DOT conformity
finding.

(6) TIP amendments from non-attainment areas that require a new or revised
conformity determination (i.e., addition of new exempt projects or scope
changes to existing exempt projects in the TIP) require an FHWA/FTA
conformity determination prior to being added to the TIP and STIP.

(7) For TIP actions which do not involve transit projects, the FTA will
prepare a letter of acknowledgment and concurrence on the draft conformity
finding, indicating that the TIP action in question does not contain any
projects in FTA's area of responsibility. Similarly for TIP actions which
do not involve highway projects, the FHWA will prepare a letter of
acknowledgment and concurrence on the draft conformity finding, indicating
that the TIP action in question does not contain any projects in FHWA's
area of responsibility. In either event, the issuance of the signed version
of the draft conformity finding letter will constitute the DOT conformity
finding for the TIP action in question.

(e) Department concurrence.

(1) It is the responsibility of the Department to evaluate any final
conformity determination made by WILMAPCO, the Dover/Kent County MPO or
DelDOT in their respective areas. The Department must concur with this
determination within 14 days of the date after the agency initiates public
notice in any such final determination of conformity. A determination of
non-concurrence must be in accordance with Sections 10 - 19. If the
Department does not take action within 14 days of such notice of public
notice, WILMAPCO, the Dover/Kent County MPO or DelDOT, in their respective
areas, may proceed with the final determination.

(2) Any conflict among State agencies or between State agencies and either
WILMAPCO or the Dover/Kent County MPO shall be escalated to the Governor if
the conflict cannot be resolved by the heads of the involved agencies
within 30 days of the Department finding of non-concurrence. In the first
instance, such agencies shall make every effort to resolve any difference,
including personal meetings between the heads of such agencies or their
policy-level representatives, to the extent possible.

(3) The Governor may delegate the role of hearing any such appeal under
this subsection and of deciding whether to concur in the conformity
determination to another official or agency within the State, but not to
the head or staff of the Department, DelDOT, a State transportation
commission or board, any agency that has responsibility for only one of
these functions, WILMAPCO or the Dover/Kent County MPO.

(f) Public consultation procedures.

Agencies making conformity determinations (MPOs, DelDOT, etc. as
appropriate) on transportation plans, programs, and projects shall
establish and continuously implement a proactive public involvement process
which provides opportunity for public review and comment prior to taking
formal action on a conformity determination for all transportation plans
and TIPs consistent with the requirements of 23 CFR part 450, including
§§ 450.316(b)(1), 450.322(c), and 450.324(c) as in effect on the date of
adoption of this regulation. In addition, any such agency must specifically
address in writing all public comments that known plans for a regionally
significant project which is not receiving FHWA or FTA funding or approval
have not been properly reflected in the emissions analysis supporting a
proposed conformity finding for a transportation plan or TIP. Any such
agency shall also provide opportunity for public involvement in conformity
determinations for projects to the extent otherwise required by law (such
as NEPA). The opportunity for public involvement provided under this
subsection shall include reasonable access to information, emissions data,
analyses, models and modeling assumptions used to perform a conformity
determination, and the obligation of any such agency to consider and
respond to significant comments. No transportation plan, TIP, or Project
may be found to conform unless the determination of conformity has been
subject to a public involvement process in accordance with this subsection,
without regard to whether the DOT has certified any process under 23 CFR
part 450.

Section 7 - Content of Transportation Plans

(a) Transportation plans adopted after January 1, 1995, in New Castle and
Kent Counties.

The transportation plan must specifically describe the transportation
system envisioned for certain future years which shall be called horizon
years.

(1) The agency or organization developing the transportation plan, after
consultation in accordance with Section 6, may choose any years to be
horizon years, subject to the following restrictions:

(i) Horizon years may be no more than 10 years apart.

(ii) The first horizon year may be no more than 10 years from the base year
used to validate the transportation demand planning model.

(iii) If the attainment year is in the time span of the transportation
plan, the attainment year must be a horizon year.

(iv) The last horizon year must be the last year of the transportation
plan's forecast period.

(2) For these horizon years:
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(i) The transportation plan shall quantify and document the demographic and
employment factors influencing expected transportation demand, including
land use forecasts (whether separate or incorporated into other factors),
in accordance with implementation plan provisions and Section 6;

(ii) The highway and transit system shall be described in terms of the
regionally significant additions or modifications to the existing
transportation network which the transportation plan envisions to be
operational in the horizon years. Additions and modifications to the
highway network shall be sufficiently identified to indicate intersections
with existing regionally significant facilities, and to determine their
effect on route options between transportation analysis zones. Each added
or modified highway segment shall also be sufficiently identified in terms
of its design concept and design scope to allow modeling of travel times
under various traffic volumes, consistent with the modeling methods for
area-wide transportation analysis in use by the MPO. Transit facilities,
equipment, and services envisioned for the future shall be identified in
terms of design concept, design scope, and operating policies that are
sufficient for modeling of their transit ridership. Additions and
modifications to the transportation network shall be described sufficiently
to show that there is a reasonable relationship between expected land use
and the envisioned transportation system; and

(iii) Other future transportation policies, requirements, services, and
activities, including intermodal activities, shall be described.

(b) Moderate areas reclassified to serious. Ozone or CO nonattainment areas
which are reclassified from moderate to serious and have an urbanized
population greater than 200,000 must meet the requirements of paragraph

(a) of this section within two years from the date of reclassification.

(c) Transportation plans for other areas. Transportation plans for other
areas must meet the requirements of paragraph (a) of this section at least
to the extent it has been the previous practice of the MPO to prepare plans
which meet those requirements. Otherwise, the transportation system
envisioned for the future must be sufficiently described within the
transportation plans so that a conformity determination can be made
according to the criteria and procedures of Sections 10 through 20.

(d) Savings. The requirements of this section supplement other requirements
of applicable law or regulation governing the format or content of
transportation plans.

Section 8 - Relationship of Transportation Plan and TIP Conformity with the
NEPA Process.

The degree of specificity required in the transportation plan and the
specific travel network assumed for air quality modeling do not preclude
the consideration of alternatives in the NEPA process or other project
development studies. Should the NEPA process result in a project with
design concept and scope significantly different from that in the
transportation plan or TIP, the project must meet the criteria in Sections
10 through 20 for projects not from a TIP before NEPA process completion.

Section 9 - Fiscal Constraints for Transportation Plans and Tips

Transportation plans and TIPs must be fiscally constrained consistent with
DOT's metropolitan planning regulations at 23 CFR part 450 in order to be
found in conformity.

Section 10 - Criteria and Procedures for Determining Conformity of
Transportation Plans, Programs, and Projects: General

(a) In order for each transportation plan, program, and FHWA/FTA project to
be found to conform, the MPO and DOT must demonstrate that the applicable
criteria and procedures in this regulation are satisfied, and the MPO and
DOT must comply with all applicable conformity requirements of
implementation plans and of court orders for the area which pertain
specifically to conformity. The criteria for making conformity
determinations differ based on the action under review (transportation
plans, TIPs, and FHWA/FTA projects), the relevant pollutant(s), and the
status of the implementation plan.

(b) The following table indicates the criteria and procedures in Sections
10 through 20 which apply for transportation plans, TIPs, and FHWA/FTA
projects. Paragraphs (c) through (f) of this section explain when the
budget, emission reduction, and hot spot tests are required for each
pollutant. Paragraph (g) of this section addresses isolated rural
nonattainment and maintenance areas.

Table 1. Conformity Criteria

ALL ACTIONS AT ALL TIMES

Section 11 Latest planning assumptions

Section 12 Latest emissions model

Section 13 Consultation

TRANSPORTATION PLAN

Section 14(b) TCMs

Sections 19 or 20 Emissions budget OR Emission reduction
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TIP

Section 14(c) TCMs

Sections 19 or 20 Emissions budget OR Emission reduction

PROJECT (FROM A CONFORMING PLAN AND TIP)

Section 15 Currently conforming plan and TIP

Section 16 Project from a conforming plan and TIP

Section 17 CO and PM10 hot spots

Section 18 PM10 control measures

PROJECT (NOT FROM A CONFORMING PLAN AND TIP)

Section 14(d) TCMs

Section 15 Currently conforming plan and TIP

Section 16 CO and PM10 hot spots

Section 18 PM10 control measures

Sections 19 or 20 Emissions budget OR Emission reduction

(c) Ozone nonattainment and maintenance areas. In addition to the criteria
listed in table 1 that are required to be satisfied at all times, in ozone
nonattainment and maintenance areas conformity determinations must include
a demonstration that the budget and/or emission reduction tests are
satisfied as described in the following paragraphs.

(1) In ozone nonattainment and maintenance areas the budget test must be
satisfied as required by Section 19 for conformity determinations made:

(i) 45 days after a control strategy implementation plan revision or
maintenance plan has been submitted to EPA, unless EPA has declared the
motor vehicle emissions budget inadequate for transportation conformity
purposes; or

(ii) After EPA has declared that the motor vehicle emissions budget in a
submitted control strategy implementation plan revision or maintenance plan
is adequate for transportation conformity purposes.

(2) In ozone nonattainment areas that are required to submit a control
strategy implementation plan revision (usually moderate and above areas),
the emission reduction tests must be satisfied as required by Section 20
for conformity determinations made:

(i) During the first 45 days after a control strategy implementation plan
revision or maintenance plan has been submitted to EPA, unless EPA has
declared a motor vehicle emissions budget adequate for transportation
conformity purposes; or

(ii) If EPA has declared the motor vehicle emissions budget in a submitted

control strategy implementation plan revision or maintenance plan
inadequate for transportation conformity
purposes, and there is no previously established motor vehicle emissions
budget in the approved implementation plan or a previously submitted
control strategy implementation plan revision or maintenance plan.

(3) An ozone nonattainment area must satisfy the emission reduction test
for Nox, as

required by Section 20, if the implementation plan or plan submission that
is applicable for the purposes of conformity determinations is a 15% plan
or Phase I attainment demonstration that does not include a motor vehicle
emissions budget for NOx. The implementation plan will be considered to
establish a motor vehicle emissions budget for NOx if the implementation
plan or plan submission contains an explicit NOx motor vehicle emissions
budget that is intended to act as a ceiling on future NOx emissions, and
the NOx motor vehicle emissions budget is a net reduction from NOx
emissions levels in 1990.

(4) Ozone nonattainment areas that have not submitted a maintenance plan
and that are not required to submit a control strategy implementation plan
revision (usually marginal and below areas) must satisfy one of the
following requirements:

(i) The emission reduction tests required by Section 20; or

(ii) The State shall submit to EPA an implementation plan revision that
contains motor vehicle emissions budget(s) and an attainment demonstration,
and the budget test required by Section 19 must be satisfied using the
submitted motor vehicle emissions budget(s) (as described in paragraph
(c)(1) of this section).

5) Notwithstanding paragraphs (c)(1) and (c)(2) of this section, moderate
and above ozone nonattainment areas with three years of clean data that
have not submitted a maintenance plan and that EPA has determined are not
subject to the Clean Air Act reasonable further progress and attainment
demonstration requirements must satisfy one of the following requirements:

(i) The emission reduction tests as required by Section 20;

(ii) The budget test as required by Section 19, using the motor vehicle
emissions budgets in the submitted control strategy implementation plan
(subject to the timing requirements of paragraph (c)(1) of this section);
or

(iii) The budget test as required by Section 19, using the motor vehicle
emissions of ozone precursors in the most recent year of clean data as
motor vehicle emissions budgets, if such budgets are established by the EPA
rulemaking that determines that the area has clean data.

(d) CO nonattainment and maintenance areas. In
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addition to the criteria listed in Table 1 that are required to be
satisfied at all times, in CO nonattainment and maintenance areas
conformity determinations must include a demonstration that the hot spot,
budget and/or emission reduction tests are satisfied as described in the
following paragraphs.

(1) FHWA/FTA projects in CO nonattainment or maintenance areas must satisfy
the hot spot test required by Section 17(a) at all times. Until a CO
attainment demonstration or maintenance plan is approved by EPA, FHWA/FTA
projects must also satisfy the hot spot test required by Section 17(b).

(2) In CO nonattainment and maintenance areas the budget test must be
satisfied as required by Section 19 for conformity determinations made:

(i) 45 days after a control strategy implementation plan revision or
maintenance plan has been submitted to EPA, unless EPA has declared the
motor vehicle emissions budget inadequate for transportation conformity
purposes; or

(ii) After EPA has declared that the motor vehicle emissions budget in a
submitted control strategy implementation plan revision or maintenance plan
is adequate for transportation conformity purposes.

(3) Except as provided in paragraph (4) below, in CO nonattainment areas
the emission reduction tests must be satisfied as required by Section 20
for conformity determinations made:

(i) During the first 45 days after a control strategy implementation plan
revision or maintenance plan has been submitted to EPA, unless EPA has
declared a motor vehicle emissions budget adequate for transportation
conformity purposes; or

(ii) If EPA has declared the motor vehicle emissions budget in a submitted
control strategy implementation plan revision or maintenance plan
inadequate for transportation conformity purposes, and there is no
previously established motor vehicle emissions budget in the approved
implementation plan or a previously submitted control strategy
implementation plan revision or maintenance plan.

(4) CO nonattainment areas that have not submitted a maintenance plan and
that are not required to submit an attainment demonstration (e.g., moderate
CO areas with a design value of 12.7 ppm or less or not classified CO
areas) must satisfy one of the following requirements:

(i) The emission reduction tests required by Section 20; or

(ii) The State shall submit to EPA an implementation plan revision that
contains motor vehicle emissions budget(s) and an attainment demonstration,
and the budget test required by Section 19 must be satisfied using the
submitted motor vehicle emissions budget(s) (as described in paragraph
(d)(2) of this section).

(e) PM10 nonattainment and maintenance areas. In addition to the criteria
listed in Table 1 that are required to be satisfied at all times, in PM10
nonattainment and maintenance areas conformity determinations must include
a demonstration that the hot spot, budget and/or emission reduction tests
are satisfied as described in the following paragraphs.

(1) FHWA/FTA projects in PM10 nonattainment or maintenance areas must
satisfy the hot spot test required by Section 17 (a).

(2) In PM10 nonattainment and maintenance areas the budget test must be
satisfied as required by Section 19 for conformity determinations made:

(i) 45 days after a control strategy implementation plan revision or
maintenance plan has been submitted to EPA, unless EPA has declared the
motor vehicle emissions budget inadequate for transportation conformity
purposes; or

(ii) After EPA has declared that the motor vehicle emissions budget in a
submitted control strategy implementation plan revision or maintenance plan
is adequate for transportation conformity purposes.

(3) In PM10 nonattainment areas the emission reduction tests must be
satisfied as required by Section 20 for conformity determinations made:

(i) During the first 45 days after a control strategy implementation plan
revision or maintenance plan has been submitted to EPA, unless EPA has
declared a motor vehicle emissions budget adequate for transportation
conformity purposes;

(ii) If EPA has declared the motor vehicle emissions budget in a submitted
control strategy implementation plan revision or maintenance plan
inadequate for transportation conformity purposes, and there is no
previously established motor vehicle emissions budget in the approved
implementation plan or a previously submitted control strategy
implementation plan revision or maintenance plan; or

(iii) If the submitted implementation plan revision is a demonstration of
impracticability under CAA § 189(a)(1)(B)(ii) and does not demonstrate
attainment.

(f) NO2 nonattainment and maintenance areas. In addition to the criteria
listed in Table 1 that are required to be satisfied at all times, in NO2
nonattainment and maintenance areas conformity determinations must include
a demonstration that the budget and/or emission reduction tests are
satisfied as described in the following paragraphs.

(1) In NO2 nonattainment and maintenance areas the budget test must be
satisfied as required by Section 19 for conformity determinations made:

(i) 45 days after a control strategy
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implementation plan revision or maintenance plan has been submitted to EPA,
unless EPA has declared the motor vehicle emissions budget inadequate for
transportation conformity purposes; or

(ii) After EPA has declared that the motor vehicle emissions budget in a
submitted control strategy implementation plan revision or maintenance plan
is adequate for transportation conformity purposes.

(2) In NO2 nonattainment areas the emission reduction tests must be
satisfied as required by Section 20 for conformity determinations made:

(i) During the first 45 days after a control strategy implementation plan
revision or maintenance plan has been submitted to EPA, unless EPA has
declared a motor vehicle emissions budget adequate for transportation
conformity purposes; or

(ii) If EPA has declared the motor vehicle emissions budget in a submitted
control strategy implementation plan revision or maintenance plan
inadequate for transportation conformity purposes, and there is no
previously established motor vehicle emissions budget in the approved
implementation plan or a previously submitted control strategy
implementation plan revision or maintenance plan.

(g) Isolated rural nonattainment and maintenance areas. This paragraph
applies to any nonattainment or maintenance area (or portion thereof) which
does not have a metropolitan transportation plan or TIP and whose projects
are not part of the emissions analysis of any MPO's metropolitan
transportation plan or TIP. This paragraph does not apply to "donut" areas
which are outside the metropolitan planning boundary and inside the
nonattainment/maintenance area boundary.

(1) FHWA/FTA projects in all isolated rural nonattainment and maintenance
areas must satisfy the requirements of Sections 11, 12, 13, 14(d), 17 and
18. Until EPA approves the control strategy implementation plan or
maintenance plan for a rural CO nonattainment or maintenance area, FHWA/FTA
projects must also satisfy the requirements of Section 17(b).

(2) Isolated rural nonattainment and maintenance areas are subject to the
budget and/or emission reduction tests as described in paragraphs (c)-(f)
of this section, with the following modifications:

(i) When the requirements of Section 19 and 20 apply to isolated rural
nonattainment and maintenance areas, references to "transportation plan" or
"TIP" should be taken to mean those projects in the statewide
transportation plan or statewide TIP which are in the rural nonattainment
or maintenance area.

(ii) In isolated rural nonattainment and maintenance areas that are subject
to Section 19, FHWA/FTA projects must be consistent with motor vehicle
emissions budget(s) for the years in the timeframe of the attainment
demonstration or maintenance plan. For years after the attainment year (if
a maintenance plan has not been submitted) or after the last year of the
maintenance plan, FHWA/FTA projects must satisfy one of the following
requirements:

(A) Section 19;

(B) Section 20 (including regional emissions analysis for NOx in all ozone
nonattainment and maintenance areas, notwithstanding Section 20 (d)(2)); or

(C) As demonstrated by the air quality dispersion model or other air
quality modeling technique used in the attainment demonstration or
maintenance plan, the FHWA/FTA project, in combination with all other
regionally significant projects expected in the area in the timeframe of
the statewide transportation plan, must not cause or contribute to any new
violation of any standard in any areas; increase the frequency or severity
of any existing violation of any standard in any area; or delay timely
attainment of any standard or any required interim emission reductions or
other milestones in any area. Control measures assumed in the analysis must
be enforceable.

(iii) The choice of requirements in paragraph (g)(2)(ii) of this section
and the methodology used to meet the requirements of paragraph
(g)(2)(ii)(C) of this section must be determined through the interagency
consultation process required in Section 6 (c)(1)(vii) through which the
relevant recipients of title 23 U.S.C. or Federal Transit Laws funds, the
local air quality agency, the State air quality agency, and the State
department of transportation should reach consensus about the option and
methodology selected. EPA and DOT must be consulted through this process as
well. In the event of unresolved disputes, conflicts may be escalated to
the Governor consistent with the procedure in Section 6 (d), which applies
for any State air agency comments on a conformity determination.

Section 11 - Criteria and Procedures: Latest Planning Assumptions.

(a) The conformity determination, with respect to all other applicable
criteria in Sections 12 through 20, must be based upon the most recent
planning assumptions in force at the time of the conformity determination.
The conformity determination must satisfy the requirements of paragraphs
(b) through (f) of this section.

(b) Assumptions must be derived from the estimates of current and future
population, employment, travel, and congestion most recently developed by
the MPO or other agency authorized to make such estimates and approved by
the MPO. The conformity determination must also be based on the latest
assumptions about current and future
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background concentrations.

(c) The conformity determination for each transportation plan and TIP must
discuss how transit operating policies (including fares and service levels)
and assumed transit ridership have changed since the previous conformity
determination.

(d) The conformity determination must include reasonable assumptions about
transit service and increases in transit fares and road and bridge tolls
over time.

(e) The conformity determination must use the latest existing information
regarding the effectiveness of the TCMs and other implementation plan
measures which have already been implemented.

(f) Key assumptions shall be specified and included in the draft documents
and supporting materials used for the interagency and public consultation
required by Section 6.

Section 12 - Criteria and Procedures: Latest Emissions Model.

(a) The conformity determination must be based on the latest emission
estimation model available. This criterion is satisfied if the most current
version of the motor vehicle emissions model specified by EPA for use in
the preparation or revision of implementation plans in that State or area
is used for the conformity analysis. Where EMFAC is the motor vehicle
emissions model used in preparing or revising the applicable implementation
plan, new versions must be approved by EPA before they are used in the
conformity analysis.

(b) EPA will consult with DOT to establish a grace period following the
specification of any new model.

(1) The grace period will be no less than three months and no more than 24
months after notice of availability is published in the Federal Register.

(2) The length of the grace period will depend on the degree of change in
the model and the scope of re-planning likely to be necessary by MPOs in
order to assure conformity. If the grace period will be longer than three
months, EPA will announce the appropriate grace period in the Federal
Register.

(c) Transportation plan and TIP conformity analyses for which the emissions
analysis was begun during the grace period or before the Federal Register
notice of availability of the latest emission model may continue to use the
previous version of the model. Conformity determinations for projects may
also be based on the previous model if the
analysis was begun during the grace period or before the Federal Register
notice of availability, and if the final environmental document for the
project is issued no more than three years after the issuance of the draft
environmental document.

Section 13 - Criteria and Procedures: Consultation.

THIS SECTION IS NOT APPLICABLE TO OR REQUIRED BY THE STATE OF DELAWARE AND
WILL NOT BE INCLUDED IN THE ADOPTED VERSION OF THIS REGULATION.

For the Reader's information: Conformity must be determined according to
the consultation procedures in this regulation and in the applicable
implementation plan, and according to the public involvement procedures
established in compliance with 23 CFR part 450. Until the implementation
plan revision required by 40 CFR §51.390 is fully approved by EPA, the
conformity determination must be made according to Section 6 (a)(2) and (e)
and the requirements of 23 CFR part 450.

Section 14 - Criteria and Procedures: Timely Implementation of TCMs.

(a) The transportation plan, TIP, or any FHWA/FTA project which is not from
a conforming plan and TIP must provide for the timely implementation of
TCMs from the applicable implementation plan.

(b) For transportation plans, this criterion is satisfied if the following
two conditions are met:

(1) The transportation plan, in describing the envisioned future
transportation system, provides for the timely completion or implementation
of all TCMs in the applicable implementation plan which are eligible for
funding under title 23 U.S.C. or the Federal Transit Laws, consistent with
schedules included in the applicable implementation plan.

(2) Nothing in the transportation plan interferes with the implementation
of any TCM in the applicable implementation plan.

(c) For TIPs, this criterion is satisfied if the following conditions are
met:

(1) An examination of the specific steps and funding source(s) needed to
fully implement each TCM indicates that TCMs which are eligible for funding
under title 23 U.S.C. or the Federal Transit Laws are on or ahead of the
schedule established in the applicable implementation plan, or, if such
TCMs are behind the schedule established in the applicable implementation
plan, the MPO and DOT have determined that past obstacles to implementation
of
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the TCMs have been identified and have been or are being overcome, and that
all State and local agencies with influence over approvals or funding for
TCMs are giving maximum priority to approval or funding of TCMs over other
projects within their control, including projects in locations outside the
nonattainment or maintenance area.

(2) If TCMs in the applicable implementation plan have previously been
programmed for Federal funding but the funds have not been obligated and
the TCMs are behind the schedule in the implementation plan, then the TIP
cannot be found to conform if the funds intended for those TCMs are
reallocated to projects in the TIP other than TCMs, or if there are no
other TCMs in the TIP, if the funds are reallocated to projects in the TIP
other than projects which are eligible for Federal funding intended for air
quality improvement projects, e.g., the Congestion Mitigation and Air
Quality Improvement Program.

(3) Nothing in the TIP may interfere with the implementation of any TCM in
the applicable implementation plan.

(d) For FHWA/FTA projects which are not from a conforming transportation
plan and TIP, this criterion is satisfied if the project does not interfere
with the implementation of any TCM in the applicable implementation plan.

Section 15 - Criteria and Procedures: Currently Conforming Transportation
Plan and TIP.

There must be a currently conforming transportation plan and currently
conforming TIP at the time of project approval.

(a) Only one conforming transportation plan or TIP may exist in an area at
any time; conformity determinations of a previous transportation plan or
TIP expire once the current plan or TIP is found to conform by DOT. The
conformity determination on a transportation plan or TIP will also lapse if
conformity is not determined according to the frequency requirements
specified in Section 5.

(b) This criterion is not required to be satisfied at the time of project
approval for a TCM specifically included in the applicable implementation
plan, provided that all other relevant criteria of this regulation are
satisfied.

Section 16 - Criteria and Procedures: Projects From a Plan and TIP.

(a) The project must come from a conforming plan and program. If this
criterion is not satisfied, the project must satisfy all criteria in Table
1 for a project not from a conforming transportation plan and TIP. A
project is
considered to be from a conforming transportation plan if it meets the
requirements of paragraph (b) of this section and from a conforming program
if it meets the requirements of paragraph (c) of this section. Special
provisions for TCMs in an applicable implementation plan are provided in
paragraph (d) of this section.

(b) A project is considered to be from a conforming transportation plan if
one of the following conditions applies:

(1) For projects which are required to be identified in the transportation
plan in order to satisfy Section 7, the project is specifically included in
the conforming transportation plan and the project's design concept and
scope have not changed significantly from those which were described in the
transportation plan, or in a manner which would significantly impact use of
the facility; or

(2) For projects which are not required to be specifically identified in
the transportation plan, the project is identified in the conforming
transportation plan, or is consistent with the policies and purpose of the
transportation plan and will not interfere with other projects specifically
included in the transportation plan.

(c) A project is considered to be from a conforming program if the
following conditions are met:

(1) The project is included in the conforming TIP and the design concept
and scope of the project were adequate at the time of the TIP conformity
determination to determine its contribution to the TIP's regional
emissions, and the project design concept and scope have not changed
significantly from those which were described in the TIP; and

(2) If the TIP describes a project design concept and scope which includes
project-level emissions mitigation or control measures, written commitments
to implement such measures must be obtained from the project sponsor and/or
operator as required by Section 26 (a) in order for the project to be
considered from a conforming program. Any change in these mitigation or
control measures that would significantly reduce their effectiveness
constitutes a change in the design concept and scope of the project.

(d) TCMs. This criterion is not required to be satisfied for TCMs
specifically included in an applicable implementation plan.

Section 17 - Criteria And Procedures: Localized CO and PM10 Violations (Hot
Spots).

(a) This paragraph applies at all times. The FHWA/FTA project must not
cause or contribute to any new localized CO or PM10 violations or increase
the frequency or severity of any existing CO or PM10 violations in CO and
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PM10 nonattainment and maintenance areas. This criterion is satisfied if it
is demonstrated that no new local violations will be created and the
severity or number of existing violations will not be increased as a result
of the project. The demonstration must be performed according to the
consultation requirements of Section 6 (c)(1)(i) and the methodology
requirements of Section 24.

(b) This paragraph applies for CO nonattainment areas as described in
Section 10 (d)(1). Each FHWA/FTA project must eliminate or reduce the
severity and number of localized CO violations in the area substantially
affected by the project (in CO nonattainment areas). This criterion is
satisfied with respect to existing localized CO violations if it is
demonstrated that existing localized CO violations will be eliminated or
reduced in severity and number as a result of the project. The
demonstration must be performed according to the consultation requirements
of Section 6 (c)(1)(i) and the methodology requirements of Section 24.

Section 18 - Criteria And Procedures: Compliance with PM10 Control
Measures.

The FHWA/FTA project must comply with PM10 control measures in the
applicable implementation plan. This criterion is satisfied if the
project-level conformity determination contains a written commitment from
the project sponsor to include in the final plans, specifications, and
estimates for the project those control measures (for the purpose of
limiting PM10 emissions from the construction activities and/or normal use
and operation associated with the project) that are contained in the
applicable implementation plan.

Section 19 - Criteria and Procedures: Motor Vehicle Emissions Budget.

(a) The transportation plan, TIP, and project not from a conforming
transportation plan and TIP must be consistent with the motor vehicle
emissions budget(s) in the applicable implementation plan (or
implementation plan submission). This criterion applies as described in
Section 10 (c)-(g). This criterion is satisfied if it is demonstrated that
emissions of the pollutants or pollutant precursors described in paragraph
(c) of this section are less than or equal to the motor vehicle emissions
budget(s) established in the applicable implementation plan or
implementation plan submission.

(b) Consistency with the motor vehicle emissions budget(s) must be
demonstrated for each year for which the applicable (and/or submitted)
implementation plan specifically establishes motor vehicle emissions
budget(s),
for the last year of the transportation plan's forecast period, and for any
intermediate years as necessary so that the years for which consistency is
demonstrated are no more than ten years apart, as follows:

(1) Until a maintenance plan is submitted:

(i) Emissions in each year (such as milestone years and the attainment
year) for which the control strategy implementation plan revision
establishes motor vehicle emissions budget(s) must be less than or equal to
that year's motor vehicle emissions budget(s); and

(ii) Emissions in years for which no motor vehicle emissions budget(s) are
specifically established must be less than or equal to the motor vehicle
emissions budget(s) established for the most recent prior year. For
example, emissions in years after the attainment year for which the
implementation plan does not establish a budget must be less than or equal
to the motor vehicle emissions budget(s) for the attainment year.

(2) When a maintenance plan has been submitted:

(i) Emissions must be less than or equal to the motor vehicle emissions
budget(s) established for the last year of the maintenance plan, and for
any other years for which the maintenance plan establishes motor vehicle
emissions budgets. If the maintenance plan does not establish motor vehicle
emissions budgets for any years other than the last year of the maintenance
plan, the demonstration of consistency with the motor vehicle emissions
budget(s) must be accompanied by a qualitative finding that there are no
factors which would cause or contribute to a new violation or exacerbate an
existing violation in the years before the last year of the maintenance
plan. The interagency consultation process required by Section 6 shall
determine what must be considered in order to make such a finding;

(ii) For years after the last year of the maintenance plan, emissions must
be less than or equal to the maintenance plan's motor vehicle emissions
budget(s) for the last year of the maintenance plan; and

(iii) If an approved control strategy implementation plan has established
motor vehicle emissions budgets for years in the time frame of the
transportation plan, emissions in these years must be less than or equal to
the control strategy implementation plan's motor vehicle emissions
budget(s) for these years.

(c) Consistency with the motor vehicle emissions budget(s) must be
demonstrated for each pollutant or pollutant precursor in Section 3 (b) for
which the area is in nonattainment or maintenance and for which the
applicable implementation plan (or implementation plan submission)
establishes a motor vehicle emissions budget.

(d) Consistency with the motor vehicle emissions
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budget(s) must be demonstrated by including emissions from the entire
transportation system, including all regionally significant projects
contained in the transportation plan and all other regionally significant
highway and transit projects expected in the nonattainment or maintenance
area in the timeframe of the transportation plan.

(1) Consistency with the motor vehicle emissions budget(s) must be
demonstrated with a regional emissions analysis that meets the requirements
of Sections 23 and 6 (c)(1)(i).

(2) The regional emissions analysis may be performed for any years in the
timeframe of the transportation plan provided they are not more than ten
years apart and provided the analysis is performed for the attainment year
(if it is in the timeframe of the transportation plan) and the last year of
the plan's forecast period. Emissions in years for which consistency with
motor vehicle emissions budgets must be demonstrated, as required in
paragraph (b) of this section, may be determined by interpolating between
the years for which the regional emissions analysis is performed.

(e) Motor Vehicle emissions budgets in submitted control strategy
implementation plan revisions and submitted maintenance plans.

(1) Consistency with the motor vehicle emissions budgets in submitted
control strategy implementation plan revisions or maintenance plans must be
demonstrated if EPA has declared the motor vehicle emissions budget(s)
adequate for transportation conformity purposes, or beginning 45 days after
the control strategy implementation plan revision or maintenance plan has
been submitted (unless EPA has declared the motor vehicle emissions
budget(s) inadequate for transportation conformity purposes). However,
submitted implementation plans do not supersede the motor vehicle emissions
budgets in approved implementation plans for the period of years addressed
by the approved implementation plan.

(2) If EPA has declared an implementation plan submission's motor vehicle
emissions budget(s) inadequate for transportation conformity purposes, the
inadequate budget(s) shall not be used to satisfy the requirements of this
section. Consistency with the previously established motor vehicle
emissions budget(s) must be demonstrated. If there are no previous approved
implementation plans or implementation plan submissions with motor vehicle
emissions budgets, the emission reduction tests required by Section 20 must
be satisfied.

(3) If EPA declares an implementation plan submission's motor vehicle
emissions budget(s) inadequate for transportation conformity purposes more
than 45 days after its submission to EPA, and conformity of a
transportation plan or TIP has already been determined by
DOT using the budget(s), the conformity determination will remain valid.
Projects included in that transportation plan or TIP could still satisfy
Sections 15 and 16, which require a currently conforming transportation
plan and TIP to be in place at the time of a project's conformity
determination and that projects come from a conforming transportation plan
and TIP.

(4) EPA will not find a motor vehicle emissions budget in a submitted
control strategy implementation plan revision or maintenance plan to be
adequate for transportation conformity purposes unless the following
minimum criteria are satisfied:

(i) The submitted control strategy implementation plan revision or
maintenance plan was endorsed by the Governor (or his or her designee) and
was subject to a State public hearing;

(ii) Before the control strategy implementation plan or maintenance plan
was submitted to EPA, consultation among federal, State, and local agencies
occurred; full implementation plan documentation was provided to EPA; and
EPA's stated concerns, if any, were addressed;

(iii) The motor vehicle emissions budget(s) is clearly identified and
precisely quantified;

(iv) The motor vehicle emissions budget(s), when considered together with
all other emissions sources, is consistent with applicable requirements for
reasonable further progress, attainment, or maintenance (whichever is
relevant to the given implementation plan submission);

(v) The motor vehicle emissions budget(s) is consistent with and clearly
related to the emissions inventory and the control measures in the
submitted control strategy implementation plan revision or maintenance
plan; and

(vi) Revisions to previously submitted control strategy implementation
plans or maintenance plans explain and document any changes to previously
submitted budgets and control measures; impacts on point and area source
emissions; any changes to established safety margins (see Section 2 for
definition); and reasons for the changes (including the basis for any
changes related to emission factors or estimates of vehicle miles
traveled).

(5) Before determining the adequacy of a submitted motor vehicle emissions
budget, EPA will review the State's compilation of public comments and
response to comments that are required to be submitted with any
implementation plan. EPA will document its consideration of such comments
and responses in a letter to the State indicating the adequacy of the
submitted motor vehicle emissions budget.

(6) When the motor vehicle emissions budget(s) used to satisfy the
requirements of this section are
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established by an implementation plan submittal that has not yet been
approved or disapproved by EPA, the MPO and DOT's conformity determinations
will be deemed to be a statement that the MPO and DOT are not aware of any
information that would indicate that emissions consistent with the motor
vehicle emissions budget will cause or contribute to any new violation of
any standard; increase the frequency or severity of any existing violation
of any standard; or delay timely attainment of any standard or any required
interim emission reductions or other milestones.

Section 20 - Criteria and Procedures: Emission Reductions in Areas without
Motor Vehicle Emissions Budgets.

(a) The transportation plan, TIP, and project not from a conforming
transportation plan and TIP must contribute to emissions reductions. This
criterion applies as described in Section 10 (c) - (g). It applies to the
net effect of the action (transportation plan, TIP, or project not from a
conforming transportation plan and TIP) on motor vehicle emissions from the
entire transportation system.

(b) This criterion may be met in moderate and above ozone nonattainment
areas that are subject to the reasonable further progress requirements of
Clean Air Act § 182(b)(1) and in moderate with design value greater than
12.7 ppm and serious CO nonattainment areas if a regional emissions
analysis that satisfies the requirements of Section 23 and paragraphs (e)
through (h) of this section demonstrates that for each analysis year and
for each of the pollutants described in paragraph (d) of this section:

(1) The emissions predicted in the "Action" scenario are less than the
emissions predicted in the "Baseline" scenario, and this can be reasonably
expected to be true in the periods between the analysis years; and

(2) The emissions predicted in the "Action" scenario are lower than 1990
emissions by any nonzero amount.

(c) This criterion may be met in PM10 and NO2 nonattainment areas; marginal
and below ozone nonattainment areas and other ozone nonattainment areas
that are not subject to the reasonable further progress requirements of
Clean Air Act § 182(b)(1); and moderate with design value less than 12.7
ppm and below CO nonattainment areas if a regional emissions analysis that
satisfies the requirements of Section 23 and paragraphs (e) through (h) of
this section demonstrates that for each analysis year and for each of the
pollutants described in paragraph (d) of this section, one of the following
requirements is met:

(1) The emissions predicted in the "Action" scenario are less than the
emissions predicted in the "Baseline"
scenario, and this can be reasonably expected to be true in the periods
between the analysis years; or

(2) The emissions predicted in the "Action" scenario are not greater than
baseline emissions. Baseline emissions are those estimated to have occurred
during calendar year 1990, unless the conformity implementation plan
revision required by 40 CFR §51.390 defines the baseline emissions for a
PM10 area to be those occurring in a different calendar year for which a
baseline emissions inventory was developed for the purpose of developing a
control strategy implementation plan.

(d) Pollutants. The regional emissions analysis must be performed for the
following pollutants:

(1) VOC in ozone areas;

(2) NOx in ozone areas, unless the EPA Administrator determines that
additional reductions of NOx would not contribute to attainment;

(3) CO in CO areas;

(4) PM10 in PM10 areas;

(5) Transportation-related precursors of PM10 in PM10 nonattainment and
maintenance areas if the EPA Regional Administrator or the director of the
State air agency has made a finding that such precursor emissions from
within the area are a significant contributor to the PM10 nonattainment
problem and has so notified the MPO and DOT; and

(6) NOx in NO2 areas.

(e) Analysis years. The regional emissions analysis must be performed for
analysis years that are no more than ten years apart. The first analysis
year must be no more than five years beyond the year in which the
conformity determination is being made. The last year of transportation
plan's forecast period must also be an analysis year.

(f) "Baseline" scenario. The regional emissions analysis required by
paragraphs (b) and (c) of this section must estimate the emissions that
would result from the "Baseline" scenario in each analysis year. The
"Baseline" scenario must be defined for each of the analysis years. The
"Baseline" scenario is the future transportation system that will result
from current programs, including the following (except that exempt projects
listed in Section 27 and projects exempt from regional emissions analysis
as listed in Section 28 need not be explicitly considered):

(1) All in-place regionally significant highway and transit facilities,
services and activities;

(2) All ongoing travel demand management or transportation system
management activities; and

(3) Completion of all regionally significant projects, regardless of
funding source, which are currently under
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construction or are undergoing right-of-way acquisition (except for
hardship acquisition and protective buying); come from the first year of
the previously conforming transportation plan and/or TIP; or have completed
the NEPA process.

(g) "Action" scenario. The regional emissions analysis required by
paragraphs (b) and (c) of this section must estimate the emissions that
would result from the "Action" scenario in each analysis year. The "Action"
scenario must be defined for each of the analysis years. The "Action"
scenario is the transportation system that would result from the
implementation of the proposed action (transportation plan, TIP, or project
not from a conforming transportation plan and TIP) and all other expected
regionally significant projects in the nonattainment area. The "Action"
scenario must include the following (except that exempt projects listed in
Section 27 and projects exempt from regional emissions analysis as listed
in Section 28 need not be explicitly considered):

(1) All facilities, services, and activities in the "Baseline" scenario;

(2) Completion of all TCMs and regionally significant projects (including
facilities, services, and activities) specifically identified in the
proposed transportation plan which will be operational or in effect in the
analysis year, except that regulatory TCMs may not be assumed to begin at a
future time unless the regulation is already adopted by the enforcing
jurisdiction or the TCM is identified in the applicable implementation
plan;

(3) All travel demand management programs and transportation system
management activities known to the MPO, but not included in the applicable
implementation plan or utilizing any Federal funding or approval, which
have been fully adopted and/or funded by the enforcing jurisdiction or
sponsoring agency since the last conformity determination;

(4) The incremental effects of any travel demand management programs and
transportation system management activities known to the MPO, but not
included in the applicable implementation plan or utilizing any Federal
funding or approval, which were adopted and/or funded prior to the date of
the last conformity determination, but which have been modified since then
to be more stringent or effective;

(5) Completion of all expected regionally significant highway and transit
projects which are not from a conforming transportation plan and TIP; and

(6) Completion of all expected regionally significant non-FHWA/FTA highway
and transit projects that have clear funding sources and commitments
leading toward their implementation and completion by the analysis year.

(h) Projects not from a conforming transportation plan and TIP. For the
regional emissions analysis required by paragraphs (b) and (c) of this
section, if the project which is not from a conforming transportation plan
and TIP is a modification of a project currently in the plan or TIP, the
`Baseline' scenario must include the project with its original design
concept and scope, and the `Action' scenario must include the project with
its new design concept and scope.

Section 21 - Consequences of Control Strategy Implementation Plan Failures.

(a) Disapprovals.

(1) If EPA disapproves any submitted control strategy implementation plan
revision (with or without a protective finding), the conformity status of
the transportation plan and TIP shall lapse on the date that highway
sanctions as a result of the disapproval are imposed on the nonattainment
area under § 179(b)(1) of the Clean Air Act. No new transportation plan,
TIP, or project may be found to conform until another control strategy
implementation plan revision fulfilling the same Clean Air Act requirements
is submitted and conformity to this submission is determined.

(2) If EPA disapproves a submitted control strategy implementation plan
revision without making a protective finding, then beginning 120 days after
such disapproval, only projects in the first three years of the currently
conforming transportation plan and TIP may be found to conform. This means
that beginning 120 days after disapproval without a protective finding, no
transportation plan, TIP, or project not in the first three years of the
currently conforming plan and TIP may be found to conform until another
control strategy implementation plan revision fulfilling the same Clean Air
Act requirements is submitted and conformity to this submission is
determined. During the first 120 days following EPA's disapproval without a
protective finding, transportation plan, TIP, and project conformity
determinations shall be made using the motor vehicle emissions budget(s) in
the disapproved control strategy implementation plan, unless another
control strategy implementation plan revision has been submitted and its
motor vehicle emissions budget(s) applies for transportation conformity
purposes, pursuant to Section 10.

(3) In disapproving a control strategy implementation plan revision, EPA
would give a protective finding where a submitted plan contains adopted
control measures or written commitments to adopt enforceable control
measures that fully satisfy the emissions reductions requirements relevant
to the statutory provision for which the implementation plan revision was
submitted, such as
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reasonable further progress or attainment.

(b) Failure to submit and incompleteness. In areas where EPA notifies the
State, MPO, and DOT of the State's failure to submit a control strategy
implementation plan or submission of an incomplete control strategy
implementation plan revision (either of which initiates the sanction
process under Clean Air Act § 179 or § 110(m)), the conformity status of
the transportation plan and TIP shall lapse on the date that highway
sanctions are imposed on the nonattainment area for such failure under §
179(b)(1) of the Clean Air Act, unless the failure has been remedied and
acknowledged by a letter from the EPA Regional Administrator.

(c) Federal implementation plans. If EPA promulgates a Federal
implementation plan that contains motor vehicle emissions budget(s) as a
result of a State failure, the conformity lapse imposed by this section
because of that State failure is removed.

Section 22 - Requirements for Adoption or Approval of Projects by
Recipients of Funds Designated Under Title 23 U.S.C. or the Federal Transit
Laws.

(a) Except as provided in paragraph (b) of this section, no recipient of
Federal funds designated under title 23 U.S.C. or the Federal Transit Laws
shall adopt or approve a regionally significant highway or transit project,
regardless of funding source, unless the recipient finds that the
requirements of one of the following paragraphs are met:

(1) The project was included in the first three years of the most recently
conforming transportation plan and TIP (or the conformity determination's
regional emissions analyses), even if conformity status is currently
lapsed; and the project's design concept and scope has not changed
significantly from those analyses; or

(2) There is a currently conforming transportation plan and TIP, and a new
regional emissions analysis including the project and the currently
conforming transportation plan and TIP demonstrates that the transportation
plan and TIP would still conform if the project were implemented
(consistent with the requirements of Sections 19 and/or Section 20 for a
project not from a conforming transportation plan and TIP).

(b) In isolated rural nonattainment and maintenance areas subject to
Section 10 (g), no recipient of Federal funds designated under title 23
U.S.C. or the Federal Transit Laws shall adopt or approve a regionally
significant highway or transit project, regardless of funding source,
unless the recipient finds that the
requirements of one of the following paragraphs are met:

(1) The project was included in the regional emissions analysis supporting
the most recent conformity determination for the portion of the statewide
transportation plan and TIP which are in the nonattainment or maintenance
area, and the project's design concept and scope has not changed
significantly; or

(2) A new regional emissions analysis including the project and all other
regionally significant projects expected in the nonattainment or
maintenance area demonstrates that those projects in the statewide
transportation plan and statewide TIP which are in the nonattainment or
maintenance area would still conform if the project were implemented
(consistent with the requirements of Sections 19 and/or 20 for projects not
from a conforming transportation plan and TIP).

Section 23 - Procedures for Determining Regional Transportation-Related
Emissions.

(a) General requirements.

(1) The regional emissions analysis required by Sections 19 and 20 for the
transportation plan, TIP, or project not from a conforming plan and TIP
must include all regionally significant projects expected in the
nonattainment or maintenance area. The analysis shall include FHWA/FTA
projects proposed in the transportation plan and TIP and all other
regionally significant projects which are disclosed to the MPO as required
by Section 6. Projects which are not regionally significant are not
required to be explicitly modeled, but vehicle miles traveled (VMT) from
such projects must be estimated in accordance with reasonable professional
practice. The effects of TCMs and similar projects that are not regionally
significant may also be estimated in accordance with reasonable
professional practice.

(2) The emissions analysis may not include for emissions reduction credit
any TCMs or other measures in the applicable implementation plan which have
been delayed beyond the scheduled date(s) until such time as their
implementation has been assured. If the measure has been partially
implemented and it can be demonstrated that it is providing quantifiable
emission reduction benefits, the emissions analysis may include that
emissions reduction credit.

(3) Emissions reduction credit from projects, programs, or activities which
require a regulatory action in order to be implemented may not be included
in the emissions analysis unless:

(i) The regulatory action is already adopted by the enforcing jurisdiction;

(ii) The project, program, or activity is included in the applicable
implementation plan;

(iii) The control strategy implementation plan
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submission or maintenance plan submission that establishes the motor
vehicle emissions budget(s) for the purposes of Section 19 contains a
written commitment to the project, program, or activity by the agency with
authority to implement it; or

(iv) EPA has approved an opt-in to a Federally enforced program, EPA has
promulgated the program (if the control program is a Federal
responsibility, such as vehicle tailpipe standards), or the Clean Air Act
requires the program without need for individual State action and without
any discretionary authority for EPA to set its stringency, delay its
effective date, or not implement the program.

(4) Emissions reduction credit from control measures that are not included
in the transportation plan and TIP and that do not require a regulatory
action in order to be implemented may not be included in the emissions
analysis unless the conformity determination includes written commitments
to implementation from the appropriate entities.

(i) Persons or entities voluntarily committing to control measures must
comply with the obligations of such commitments.

(ii) The conformity implementation plan revision required in CFR 40 §51.390
of this chapter must provide that written commitments to control measures
that are not included in the transportation plan and TIP must be obtained
prior to a conformity determination and that such commitments must be
fulfilled.

(5) A regional emissions analysis for the purpose of satisfying the
requirements of Section 20 must make the same assumptions in both the
"Baseline" and "Action" scenarios regarding control measures that are
external to the transportation system itself, such as vehicle tailpipe or
evaporative emission standards, limits on gasoline volatility, vehicle
inspection and maintenance programs, and oxygenated or reformulated
gasoline or diesel fuel.

(6) The ambient temperatures used for the regional emissions analysis shall
be consistent with those used to establish the emissions budget in the
applicable implementation plan. All other factors, for example the fraction
of travel in a hot stabilized engine mode, must be consistent with the
applicable implementation plan, unless modified after interagency
consultation according to Section 6 (c)(1)(i) to incorporate additional or
more geographically specific information or represent a logically estimated
trend in such factors beyond the period considered in the applicable
implementation plan.

(7) Reasonable methods shall be used to estimate nonattainment or
maintenance area VMT on off-network roadways within the urban
transportation planning area, and on roadways outside the urban
transportation planning area.

(b) Regional emissions analysis in serious, severe, and extreme ozone
nonattainment areas and serious CO nonattainment areas must meet the
requirements of paragraphs (b)(1) through (3) of this section if their
metropolitan planning area contains an urbanized area population over
200,000.

(1) By January 1, 1997, estimates of regional transportation-related
emissions used to support conformity determinations must be made at a
minimum using network-based travel models according to procedures and
methods that are available and in practice and supported by current and
available documentation. These procedures, methods, and practices are
available from DOT and will be updated periodically. Agencies must discuss
these modeling procedures and practices through the interagency
consultation process, as required by Section 6 (c)(1)(i). Network-based
travel models must at a minimum satisfy the following requirements:

(i) Network-based travel models must be validated against observed counts
(peak and off-peak, if possible) for a base year that is not more than 10
years prior to the date of the conformity determination. Model forecasts
must be analyzed for reasonableness and compared to historical trends and
other factors, and the results must be documented;

(ii) Land use, population, employment, and other network-based travel model
assumptions must be documented and based on the best available information;

(iii) Scenarios of land development and use must be consistent with the
future transportation system alternatives for which emissions are being
estimated. The distribution of employment and residences for different
transportation options must be reasonable;

(iv) A capacity-sensitive assignment methodology must be used, and
emissions estimates must be based on a methodology which differentiates
between peak and off-peak link volumes and speeds and uses speeds based on
final assigned volumes;

(v) Zone-to-zone travel impedances used to distribute trips between origin
and destination pairs must be in reasonable agreement with the travel times
that are estimated from final assigned traffic volumes. Where use of
transit currently is anticipated to be a significant factor in satisfying
transportation demand, these times should also be used for modeling mode
splits; and

(vi) Network-based travel models must be reasonably sensitive to changes in
the time(s), cost(s), and other factors affecting travel choices.

(2) Reasonable methods in accordance with good practice must be used to
estimate traffic speeds and delays in a manner that is sensitive to the
estimated volume of travel on each roadway segment represented in the
network-based travel model.

(3) Highway Performance Monitoring System
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(HPMS) estimates of vehicle miles traveled (VMT) shall be considered the
primary measure of VMT within the portion of the nonattainment or
maintenance area and for the functional classes of roadways included in
HPMS, for urban areas which are sampled on a separate urban area basis. For
areas with network-based travel models, a factor (or factors) may be
developed to reconcile and calibrate the network-based travel model
estimates of VMT in the base year of its validation to the HPMS estimates
for the same period. These factors may then be applied to model estimates
of future VMT. In this factoring process, consideration will be given to
differences between HPMS and network-based travel models, such as
differences in the facility coverage of the HPMS and the modeled network
description. Locally developed count-based programs and other departures
from these procedures are permitted subject to the interagency consultation
procedures of Section 6 (c)(1)(i).

(c) In all areas not otherwise subject to paragraph (b) of this section,
regional emissions analyses must use those procedures described in
paragraph (b) of this section if the use of those procedures has been the
previous practice of the MPO. Otherwise, areas not subject to paragraph (b)
of this section may estimate regional emissions using any appropriate
methods that account for VMT growth by, for example, extrapolating
historical VMT or projecting future VMT by considering growth in population
and historical growth trends for VMT per person. These methods must also
consider future economic activity, transit alternatives, and transportation
system policies.

(d) PM10 from construction-related fugitive dust.

(1) For areas in which the implementation plan does not identify
construction-related fugitive PM10 as a contributor to the nonattainment
problem, the fugitive PM10 emissions associated with highway and transit
project construction are not required to be considered in the regional
emissions analysis.

(2) In PM10 nonattainment and maintenance areas with implementation plans
which identify construction-related fugitive PM10 as a contributor to the
nonattainment problem, the regional PM10 emissions analysis shall consider
construction-related fugitive PM10 and shall account for the level of
construction activity, the fugitive PM10 control measures in the applicable
implementation plan, and the dust-producing capacity of the proposed
activities.

(e) Reliance on previous regional emissions analysis.

(1) The TIP may be demonstrated to satisfy the requirements of Sections 19
or 20 without new regional emissions analysis if the regional emissions
analysis
already performed for the plan also applies to the TIP. This requires a
demonstration that:

(i) The TIP contains all projects which must be started in the TIP's
timeframe in order to achieve the highway and transit system envisioned by
the transportation plan;

(ii) All TIP projects which are regionally significant are included in the
transportation plan with design concept and scope adequate to determine
their contribution to the transportation plan's regional emissions at the

time of the transportation plan's conformity determination; and

(iii) The design concept and scope of each regionally significant project
in the TIP is not significantly different from that described in the
transportation plan.

(2) A project which is not from a conforming transportation plan and a
conforming TIP may be demonstrated to satisfy the requirements of Sections
19 or 20 without additional regional emissions analysis if allocating funds
to the project will not delay the implementation of projects in the
transportation plan or TIP which are necessary to achieve the highway and
transit system envisioned by the transportation plan, and if the project is
either:

(i) not regionally significant; or

(ii) included in the conforming transportation plan (even if it is not
specifically included in the latest conforming TIP) with design concept and
scope adequate to determine its contribution to the transportation plan's
regional emissions at the time of the transportation plan's conformity
determination, and the design concept and scope of the project is not
significantly different from that described in the transportation plan.

Section 24 - Procedures for Determining Localized CO and PM10
Concentrations (Hot-Spot Analysis).

(a) CO hot-spot analysis.

(1) The demonstrations required by Section 17 must be based on quantitative
analysis using the applicable air quality models, data bases, and other
requirements specified in 40 CFR part 51 Appendix W ("Guideline on Air
Quality Models (Revised)" (1988), supplement A (1987) and supplement B
(1993), EPA publication no. 450/2-78-027R). These procedures shall be used
in the following cases, unless different procedures developed through the
interagency consultation process required in Section 6 and approved by the
EPA Regional Administrator are used:

(i) For projects in or affecting locations, areas, or categories of sites
which are identified in the applicable implementation plan as sites of
violation or possible
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violation;

(ii) For projects affecting intersections that are at Level-of-Service D,
E, or F, or those that will change to Level-of-Service D, E, or F because
of increased traffic volumes related to the project;

(iii) For any project affecting one or more of the top three intersections
in the nonattainment or maintenance area with highest traffic volumes, as
identified in the applicable implementation plan; and

(iv) For any project affecting one or more of the top three intersections
in the nonattainment or maintenance area with the worst level of service,
as identified in the applicable implementation plan.

(2) In cases other than those described in paragraph (a)(1) of this
section, the demonstrations required by Section 17 may be based on either:

(i) Quantitative methods that represent reasonable and common professional
practice; or

(ii) A qualitative consideration of local factors, if this can provide a
clear demonstration that the requirements of Section 17 are met.

(b) PM10 hot-spot analysis.

(1) The hot-spot demonstration required by Section 17 must be based on
quantitative analysis methods for the following types of projects:

(i) Projects which are located at sites at which violations have been
verified by monitoring;

(ii) Projects which are located at sites which have vehicle and roadway
emission and dispersion characteristics that are essentially identical to
those of sites with verified violations (including sites near one at which
a violation has been monitored); and

(iii) New or expanded bus and rail terminals and transfer points which
increase the number of diesel vehicles congregating at a single location.

(2) Where quantitative analysis methods are not required, the demonstration
required by Section 17 may be based on a qualitative consideration of local
factors.

(3) The identification of the sites described in paragraph (b)(1)(i) and
(ii) of this section, and other cases where quantitative methods are
appropriate, shall be determined through the interagency consultation
process required in Section 6. DOT may choose to make a categorical
conformity determination on bus and rail terminals or transfer points based
on appropriate modeling of various terminal sizes, configurations, and
activity levels.

(4) The requirements for quantitative analysis contained in paragraph (b)
of this section will not take effect until EPA releases modeling guidance
on this subject and announces in the Federal Register that these
requirements are in effect.

(c) General requirements.

(1) Estimated pollutant concentrations must be based on the total emissions
burden which may result from the implementation of the project, summed
together with future background concentrations. The total concentration
must be estimated and analyzed at appropriate receptor locations in the
area substantially affected by the project.

(2) Hot-spot analyses must include the entire project, and may be performed
only after the major design features which will significantly impact
concentrations have been identified. The future background concentration
should be estimated by multiplying current background by the ratio of
future to current traffic and the ratio of future to current emission
factors.

(3) Hot-spot analysis assumptions must be consistent with those in the
regional emissions analysis for those inputs which are required for both
analyses.

(4) PM10 or CO mitigation or control measures shall be assumed in the
hot-spot analysis only where there are written commitments from the project
sponsor and/or operator to implement such measures, as required by Section
26 (a).

(5) CO and PM10 hot-spot analyses are not required to consider
construction-related activities which cause temporary increases in
emissions. Each site which is affected by construction-related activities
shall be considered separately, using established "Guideline" methods.
Temporary increases are defined as those which occur only during the
construction phase and last five years or less at any individual site.

Section 25 - Using the Motor Vehicle Emissions Budget in the Applicable
Implementation Plan (or Implementation Plan Submission).

(a) In interpreting an applicable implementation plan (or implementation
plan submission) with respect to its motor vehicle emissions budget(s), the
MPO and DOT may not infer additions to the budget(s) that are not
explicitly intended by the implementation plan (or submission). Unless the
implementation plan explicitly quantifies the amount by which motor vehicle
emissions could be higher while still allowing a demonstration of
compliance with the milestone, attainment, or maintenance requirement and
explicitly states an intent that some or all of this additional amount
should be available to the MPO and DOT in the emissions budget for
conformity purposes, the MPO may not interpret the budget to be higher than
the implementation plan's estimate of future emissions. This applies in
particular to applicable implementation plans (or submissions) which
demonstrate that after implementation of control measures in the
implementation plan:

(1) Emissions from all sources will be less than the
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total emissions that would be consistent with a required demonstration of
an emissions reduction milestone;

(2) Emissions from all sources will result in achieving attainment prior to
the attainment deadline and/or ambient concentrations in the attainment
deadline year will be lower than needed to demonstrate attainment; or

(3) Emissions will be lower than needed to provide for continued
maintenance.

(b) If an applicable implementation plan submitted before November 24,
1993, demonstrates that emissions from all sources will be less than the
total emissions that would be consistent with attainment and quantifies
that "safety margin," the State may submit an implementation plan revision
which assigns some or all of this safety margin to highway and transit
mobile sources for the purposes of conformity. Such an implementation plan
revision, once it is endorsed by the Governor and has been subject to a
public hearing, may be used for the purposes of transportation conformity
before it is approved by EPA.

(c) A conformity demonstration shall not trade emissions among budgets
which the applicable implementation plan (or implementation plan
submission) allocates for different pollutants or precursors, or among
budgets allocated to motor vehicles and other sources, unless the
implementation plan establishes appropriate mechanisms for such trades.

(d) If the applicable implementation plan (or implementation plan
submission) estimates future emissions by geographic subarea of the
nonattainment area, the MPO and DOT are not required to consider this to
establish subarea budgets, unless the applicable implementation plan (or
implementation plan submission) explicitly indicates an intent to create
such subarea budgets for the purposes of conformity.

(e) If a nonattainment area includes more than one MPO, the implementation
plan may establish motor vehicle emissions budgets for each MPO, or else
the MPOs must collectively make a conformity determination for the entire
nonattainment area.

Section 25 - Enforceability of Design Concept and Scope and Project-Level
Mitigation and Control Measures.

(a) Prior to determining that a transportation project is in conformity,
the MPO, other recipient of funds designated under title 23 U.S.C. or the
Federal Transit Laws, FHWA, or FTA must obtain from the project sponsor
and/or operator written commitments to implement in the construction of the
project and operation of the resulting
facility or service any project-level mitigation or control measures which
are identified as conditions for NEPA process completion with respect to
local PM10 or CO impacts. Before a conformity determination is made,
written commitments must also be obtained for project-level mitigation or
control measures which are conditions for making conformity determinations
for a transportation plan or TIP and are included in the project design
concept and scope which is used in the regional emissions analysis required
by Sections 19 and 20 or used in the project-level hot-spot analysis
required by Section 17.

(b) Project sponsors voluntarily committing to mitigation measures to
facilitate positive conformity determinations must comply with the
obligations of such commitments.

(c) The implementation plan revision required in 40 CFR §51.390 shall
provide that written commitments to mitigation measures must be obtained
prior to a positive conformity determination, and that project sponsors
must comply with such commitments.

(d) If the MPO or project sponsor believes the mitigation or control
measure is no longer necessary for conformity, the project sponsor or
operator may be relieved of its obligation to implement the mitigation or
control measure if it can demonstrate that the applicable hot-spot
requirements of Section 17, emission budget requirements of Section 19, and
emission reduction requirements of Section 20 are satisfied without the
mitigation or control measure, and so notifies the agencies involved in the
interagency consultation process required under Section 6. The MPO and DOT
must find that the transportation plan and TIP still satisfy the applicable
requirements of Sections 19 and/or 20, and that the project still satisfies
the requirements of Section 17, and therefore that the conformity
determinations for the transportation plan, TIP, and project are still
valid. This finding is subject to the applicable public consultation
requirements in Section 6 (e) for conformity determinations for projects.

Section 27 - Exempt Projects.

Notwithstanding the other requirements of this regulation, highway and
transit projects of the types listed in Table 2 are exempt from the
requirement to determine conformity. Such projects may proceed toward
implementation even in the absence of a conforming transportation plan and
TIP. A particular action of the type listed in Table 2 is not exempt if the
MPO in consultation with other agencies (see Section 6 (c)(1)(iii)), the
EPA, and the FHWA (in the case of a highway project) or the FTA (in the
case of a transit project) concur that it has potentially adverse emissions
impacts for any reason. States and MPOs must
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ensure that exempt projects do not interfere with TCM implementation.

Table 2. - Exempt Projects

SAFETY

Railroad/highway crossing.

Hazard elimination program.

Safer non-Federal-aid system roads.

Shoulder improvements.

Increasing sight distance.

Safety improvement program.

Traffic control devices and operating assistance other than signalization
projects.

Railroad/highway crossing warning devices.

Guardrails, median barriers, crash cushions.

Pavement resurfacing and/or rehabilitation.

Pavement marking demonstration.

Emergency relief (23 U.S.C. 125).

Fencing.

Skid treatments.

Safety roadside rest areas.

Adding medians.

Truck climbing lanes outside the urbanized area.

Lighting improvements.

Widening narrow pavements or reconstructing bridges (no additional travel
lanes).

Emergency truck pullovers.

MASS TRANSIT

Operating assistance to transit agencies.

Purchase of support vehicles.

Rehabilitation of transit vehicles1.

Purchase of office, shop, and operating equipment for existing facilities.

Purchase of operating equipment for vehicles (e.g., radios, fareboxes,
lifts, etc.).

Construction or renovation of power, signal, and communications systems.

Construction of small passenger shelters and information kiosks.

Reconstruction or renovation of transit buildings and structures (e.g.,
rail or bus buildings, storage and maintenance facilities, stations,
terminals, and ancillary structures).

Rehabilitation or reconstruction of track structures, track, and trackbed
in existing rights-of-way.

Purchase of new buses and rail cars to replace existing vehicles or for
minor expansions of the fleet1.

Construction of new bus or rail storage/maintenance facilities
categorically excluded in 23 CFR part 771.

AIR QUALITY

Continuation of ride-sharing and van-pooling promotion
activities at current levels.

Bicycle and pedestrian facilities.

OTHER

Specific activities which do not involve or lead directly to construction,
such as:

Planning and technical studies.

Grants for training and research programs.

Planning activities conducted pursuant to titles 23 and 49 U.S.C.

Federal-aid systems revisions.

Engineering to assess social, economic, and environmental effects of the
proposed action or alternatives to that action.

Noise attenuation.

Emergency or hardship advance land acquisitions (23 CFR 712.204(d)).

Acquisition of scenic easements.

Plantings, landscaping, etc.

Sign removal.

Directional and informational signs.

Transportation enhancement activities (except rehabilitation and operation
of historic transportation buildings, structures, or facilities).

Repair of damage caused by natural disasters, civil unrest, or terrorist
acts, except projects involving substantial functional, locational or
capacity changes.

1In PM10 nonattainment or maintenance areas, such projects are exempt only
if they are in compliance with control measures in the applicable
implementation plan.

Section 28 - Projects Exempt from Regional Emissions Analyses.

Notwithstanding the other requirements of this regulation, highway and
transit projects of the types listed in Table 3 are exempt from regional
emissions analysis requirements. The local effects of these projects with
respect to CO or PM10 concentrations must be considered to determine if a
hot-spot analysis is required prior to making a project-level conformity
determination. These projects may then proceed to the project development
process even in the absence of a conforming transportation plan and TIP. A
particular action of the type listed in Table 3 is not exempt from regional
emissions analysis if the MPO in consultation with other agencies (see
Section 6 (c)(1)(iii)), the EPA, and the FHWA (in the case of a highway
project) or the FTA (in the case of a transit project) concur that it has
potential regional impacts for any reason.

Table 3. - Projects Exempt from Regional Emissions Analyses
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Intersection channelization projects.

Intersection signalization projects at individual intersections.

Interchange reconfiguration projects.

Changes in vertical and horizontal alignment.

Truck size and weight inspection stations.

Bus terminals and transfer points.

Section 29 - Traffic Signal Synchronization Projects.

Traffic signal synchronization projects may be approved, funded, and
implemented without satisfying the requirements of this regulation.
However, all subsequent regional emissions analyses required by Section 19
and 20 for transportation plans, TIPs, or projects not from a conforming
plan and TIP must include such regionally significant traffic signal
synchronization projects.

INDUSTRIAL ACCIDENT BOARD

Statutory Authority: 19 Delaware Code,

Section 2121 (19 Del.C. § 2121)

Summary:

The Industrial Accident Board proposes to adopt or amend Rule nos. 8, 9,
30, and 31 at its regular meeting on March 10, 1997 at 11:00 at the Hearing
Room of the Board, First Federal Plaza, 710 King Street, Wilmington, DE.

The change in Board Rule 8 will require a party to submit an opinion to the
Board when relying on said opinion at the time of a hearing. The change in
Board Rule 9 is intended to improve the pretrial process to insure timely
filing of the pretrial memorandum identifying and narrowing issues. It will
also bring the pretrial process into conformance with the Workers'
Compensation Statute as amended by Senate Bill 147. Proposed Rule 30 will
prohibit interrogatories except in unusual circumstances: Proposed Rule 31
will require employers to state the reason(s) for requesting certain
medical procedures prior to the payment of compensation benefits.

Comments:

Copies of the proposed rules are published in the Delaware Register of
Regulations and are on file at the Department of Labor, Division of
Industrial Affairs, 4425 North Market Street, Wilmington, DE 19802 for
inspection during regular hours. Copies are available upon request.
Interested persons may submit comments in writing before March 2, 1998 to
the Industrial Accident Board, c/o the Division of Industrial Affairs.
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Public hearing:

A public hearing on the changes will be held during the regular meeting of
the Industrial Accident Board at 11:00 a.m. on March 10, 1998 at the
Hearing Room of the Board, First Federal Plaza, 710 King Street, Wilmington
DE where interested persons can present their views.

Proposed Rule No. 8. Motions Concerning Legal Issues

(A) Except for motions contemplated by Rule No. 10 and 11, where a motion
is filed with the Department which make a legal argument, a supporting
brief containing citations shall be filed with such motion. A motion may
not be filed without proof that a copy of said motion has been served upon
the non-moving party.

(B) An answering brief shall be filed with the Department by the non-moving
party within 15 days of receipt of the supporting brief. An answering brief
may not be filed without proof that a copy of said answering brief has been
served upon the moving party.

(C) A reply brief may be filed with the Department by the moving party in
the discretion of the moving party, but in no event will a reply brief be
accepted by the Department after 7 days from the receipt by the moving
party of the non-moving party's answering brief. A reply brief may not be
filed without proof that a copy of said reply brief has been served upon
the non-moving party.

(D) After the briefs have been filed with the Department, an oral argument
may be scheduled by the Department in the Board's discretion.

(E) Motions of a procedural nature need not be accompanied by supporting
briefs. No order involving a procedural matter requested by the moving
party shall be issued by the Board against the non-moving party until the
non-moving party has been given an opportunity to be heard on the issue.

(F) Anytime after the employer's first report of injury has been filed with
the Department, the Department's scheduling officer may be notified either
by oral, telephonic or written communication of the request by a party or
party's legal counsel for a legal hearing. The Department's scheduling
officer will have the discretion of requiring a written argument from the
parties or the parties' legal counsel on the legal issue. Should one or
both of the parties fail to accept the scheduling officer's decision, the
parties must reduce their respective positions to written memorandums. The
memorandums will be submitted to the Department by the parties on a date
chosen by the scheduling officer. The Board will review the memorandums and
issue a written decision.

(G) Parties may submit a proposed stipulation order for cooperation with
reasonable vocational rehabilitation to the Board for approval without a
legal hearing.

(H) If an unreported or memorandum opinion, whether of the Board or of any
court, is cited or relied upon by any party, whether in a written
submission or during any oral presentation, a copy thereof shall be
provided to the Board and the opposing party. If, during an oral
presentation, the party relying on the unreported case does not have a copy
of such case immediately available, copies will be provided promptly after
the hearing but in no case later than the end of the next business day
following the hearing.

PROPOSED Rule 9. Formulation of Issues - Pretrial Procedure

(A) In any action, the Board may in its discretion direct the attorneys'
for the parties or the claimants, if unrepresented, to appear before it for
a conference to consider:

(A) In any action, The Department of Labor shall conduct a pretrial
conference. The Pretrial Scheduling Officers shall be responsible for
noticing and conducting such pretrial conferences. Such conference shall be
held telephonically, unless either party is unrepresented by counsel in
which case, the conference may be held at the Department of Labor offices
servicing the county where the accident occurred. The Scheduling Officer
shall set a date and time for the hearing on the issues which are the
subject of the petition convenient to all parties and counsel and subject
to the provisions of 19 Del.C. 2348 (c). Hearings as to all other Petitions
will be scheduled at the convenience of all parties and counsel to the
extent possible. At such conference, the parties may consider:

(1) The simplification of Means and methods to simplify the issues(s);

(2) The necessity or desirability of amendments to the papers filed or for
additional papers to be filed;

(3) The possibility of obtaining stipulations; admissions of fact and of
documents which will avoid unnecessary proof;

(4) The limitation of the number of expert witnesses;

(5) Such matters as may aid in the disposition or expedition of the action.

(B) The Board may make an order which recites the action taken at the
conference, the amendments allowed to the pleadings and the agreements made
by the parties or on their behalf as to any of the matters considered, and
which limits the issues for hearing to those not disposed of by admissions
or agreements of counsel. Such order when entered controls the subsequent
course of the action unless modified to prevent manifest injustice.

(C) The Board Department shall designate a Board staff member as the
pretrial officer to arrange for and preside over pretrial hearings. The
pretrial officer will have discretionary power to see that the pretrials
are conducted in an effective manner.

(D) The attorney for the petitioner, or the petitioner, will be assigned a
pretrial hearing date by the Board. The Board assumes petitioners are
prepared to go forward with their petitions on the date of filing except in
cases involving a Statute of Limitations problem. At the time of the
noticed pretrial the attorneys for the parties or the claimant, if
unrepresented, must be prepared with the following information: At the time
of the noticed pretrial, the following information or documentation must be
provided:

(1) Names and addresses of prospective medical and lay witnesses. will be
supplied.

(2) The pretrial memorandum shall contain the names of all witnesses known
to each party at the time of the pretrial conference and expected to be
called at the time of the hearing. Witnesses can be added following the
pretrial with written notice to the opposing party and the pretrial officer
not later than thirty (30) days before the hearing day. (3 ) A C complete
statement of what the petitioner seeks and alleges. When a claimant seeks
an order for payment of medical expenses, either by petition or when raised
as an issue in the pretrial conference on employer's petition, copies of
the bills shall be provided to counsel included with the p Petition, or
provided to the carrier or counsel at least 30 days before the hearing. The
requirement can be waived by a Pretrial Officer.

(4 3) Complete statement of defenses to be used by the opposing party.

(5 4) If the petitioner seeks an award under 19 Del.C. Section 2326, the
petitioner must provide to the opposing party at the pretrial the medical
reports upon which the petition is based. A copy of the medical report upon
which a petition for benefits under 19 Del.C. 2326 is based shall be
provided to opposing counsel.

(6 5) A clear statement of why a petitioner seeks to terminate a claimant's
Workers' Compensation benefits must be provided at the pretrial. A clear
statement of the basis for a petition under 19 Del.C. 2347.

(7) A party wishing to use a movie, video or still pictures must advise the
opposing party thirty (30) days prior to the hearing.

(8) In the absence of unusual circumstances, the pretrial memorandum shall
be exchanged by mail in accordance with the procedures established by the
Board's secretary and submitted to the opposing party and the Board no
later than three (3) working days prior to the scheduled pretrial.

(6) Notice of the intent to use any movie, video or still picture and
either a copy of the same or information as to where the same may be
viewed.

(E) Either party may modify a pretrial memorandum until 30 days prior to a
hearing. Thereafter, modification of a pretrial memorandum can only be done
by permission of the pretrial officer or the Board.
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Either party may modify a pretrial memorandum at any time prior to thirty
(30) days before the hearing. If the thirtieth day prior to a hearing falls
on a weekend or holiday, the last day to amend the pretrial shall be the
last business day which is at least thirty days prior to the hearing date.
Should a party wish to amend the pretrial to list additional witnesses, the
party shall provide the names and addresses of such witnesses. Notice of
any modification to the pretrial shall be sent to the opposing counsel or
to a party directly if the party is unrepresented in a fashion insuring
timely receipt of the same. The thirty day notice requirement regarding
amendments to a pretrial memorandum may be waived by consent of the parties
upon written stipulation or by the Pretrial Scheduling Officer or the Board
upon written application. However, only the party who filed the petition
which forms the subject of the pretrial memorandum may amend the petition
subject to the provisions of Board Rule 26.

(F) Subject to the pretrial officer's discretion, a hearing date for a
petition may be scheduled at the pretrial even if one or both parties fail
to attend the pretrial. Only the pretrial scheduling officer can grant a
continuance of a pretrial hearing.

(G) Responsibility does attach to the requesting party to arrange to have
medical witness(es) present for the Board's scheduled hearing date. Such
arrangements must be coordinated with and approved by the Board's
Scheduling Officer pretrial scheduling officer. Unless specifically asked
for, no Board subpoena will be issued to expert witnesses since parties
make their own arrangements for expert appearance.

(H) The pretrial officers, at their discretion, may schedule an additional
pretrial hearing upon request of either party or the Board.

(I) In the absence of unusual circumstances, the party filing a petition
shall file with said petition a pretrial memorandum with the petitioner's
portion completed. The pretrial memorandum shall be sent to the opposing
party's counsel by the Department of Labor upon the filing of an entry of
appearance. In the event that the opposing party is represented, the
petitioning party may send the pretrial directly to opposing counsel with
notice to the Board that the same has been done.

(J) The pretrial scheduling conference shall be held on a date not later
than 30 days after the date of the issuance of proper notice of a pretrial
conference regarding the petition at issue. In the event that the pretrial
memorandum has not yet been filed with the Department of Labor, the Board
shall issue an Order compelling the submission of the same by a date
certain, not to exceed fifteen (15) days.

Proposed Board Rule No. 30

(A) Interrogatories shall not be permitted as a matter of course.

(B) In the event of unusual and exceptional circumstances, a party may
petition the Board to permit limited interrogatories. The party shall state
the specific interrogatories proposed and the unusual and exceptional
circumstances supporting the petition. If, after hearing upon adequate
notice, the Board finds that unusual and exceptional circumstances do not
exist and denies the petition, the Board shall award expenses, including an
attorney's fee, to the party opposing the petition.

Proposed Board Rule No. 31

(A) No employee examined under 19 Del.C. §2343 shall be required to undergo
medical tests or techniques which are unnecessary, unduly invasive, impose
risk, or otherwise inappropriate to an informed diagnosis. The party
requesting the medical examination shall at the time of the request, advise
the employee of any medical tests or techniques to be performed that may be
invasive or impose risk.

(B) Any employee who believes that medical tests or techniques are or may
be unnecessary, unduly invasive, impose risk, or otherwise inappropriate to
an informed diagnosis may petition the Board for an immediate hearing for
the taking of testimony. If the Board grants relief to the employee, the
Board shall require the opposing party to pay the costs of the proceeding,
including medical witness fees and an attorney's fee.
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INSURANCE DEPARTMENT

Statutory Authority: 18 Delaware Code,

Sections 314, 1726 (18 Del.C. §§ 314, 1726)

INSURANCE COMMISSIONER DONNA LEE H. WILLIAMS hereby gives notice that a
PUBLIC HEARING will be held on Monday, February 23, 1998 at 10:00 a.m. in
the second floor Conference Room of the Delaware Insurance Department at
841 Silver Lake Boulevard, Dover, Delaware 19904.

The purpose of the Hearing is to solicit comments from the industry, the
agent community, and the general public on Insurance Department Regulation
No. 47 regarding education for insurance agents, brokers, surplus lines
brokers, and consultants.

The hearing will be conducted in accordance with the
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Delaware Administrative Procedures Act, 29 Del.C. Chapter 101. Comments are
being solicited from any interested party. Comments may be in writing or
may be presented orally at the hearing. Written comments must be received
by the Department of Insurance no later than Friday, February 13, 1998 and
should be addressed to Fred A. Townsend, III, Deputy Insurance
Commissioner, 841 Silver Lake Boulevard, Dover, Delaware 19904. Those
wishing to testify or those intending to provide oral testimony must notify
Fred A. Townsend, III at 302-739-4251, ext. 171 or 800-282-8611 no later
than Friday, February 13, 1998.

REGULATION No. 47

EDUCATION FOR INSURANCE AGENTS, BROKERS, SURPLUS LINES BROKERS AND
CONSULTANTS

Effective March 1, 1985

Amended June 6, 1986. Section 4

Amended March 24, 1987 and

Effective after 30 days.

Amended and effective

March 1, 1998.

SECTION

1. Authority

2. Purpose

3. Definitions

4. Entity Sponsors

5. Entity Sponsors Instructors

6. Commissioner's action upon Entity Sponsors

7. Appeals

8. Required Forms

9. Licensee's Responsibility

10. Penalty for Noncompliance

11. Continuing Education Advisory Council

12. Separability

13. Effective Date

Section 1. Authority.

This Regulation is established and promulgated pursuant to 18 Del. C.
Sections 314, 1726, and 29 Del. C. Chapter 101.

Section 2. Purpose.

The purpose of this Regulation is to establish requirements for insurance
education and ethics for insurance adjusters, agents, brokers, surplus
lines brokers and for standards for education providers and instructors in
order to ensure a high level of professionalism for the
benefit of Delaware consumers.

Section 3. Definitions.

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

(1) "Administrative record" - means any document relating to course
approval, course offerings, attendance, course completions or credits, and
any other records required to be kept by the Delaware Insurance Code, and
any rule or order of the Department.

(2) "Audit" - means Insurance Department activity to monitor the offering
of courses or examinations, including visits to classrooms, test sites, and
administrative offices where documentation of individual attendance and
completion records and documentation of instructor credentials is
maintained. Audit may include re-evaluating approved classroom course
outlines and self-study programs based on current guidelines.

(3) "Completion" - when used in the context of:

a. Self-Study, means a passing grade of 70% or better examination.

b. Class, means attendance for the full amount of time approved for each
course.

c. Seminar, means attendance for the full amount of time assigned for each
workshop or break-out session selected.

(4) "Compliance date" - means the 28th day of February of the continuing
education reporting period for which resident licensee continuing education
or non-resident renewal is required. Each license biennium shall commence
on March 1st and end February 28th of the odd year period for non-residents
and the even year for residents. Example: Non-resident deadline is February
28th of 1999, 2001, 2003 etc. Resident deadline is February 28th of 2000,
2002, 2004 etc.

(5) "Contact person" - means the person at the entity level with authority
to transact business for the entity; through contracts, licenses, or other
means, usually as the owner or corporate officer, and who designates the
school official to represent the entity.

(6) "Continuously licensed" - means an uninterrupted license without lapse
due to suspension, revocation, voluntary surrender, cancellation or
non-renewal for a period of 12 months or greater.

(7) "Course" - shall mean any class, self-study or seminar for insurance
representatives, or adjuster licensees which has been approved by the
Department for the purpose of complying with continuing education
requirements.

(8) "Credit hour" (CEUs) - means 1 unit of credit based on a classroom hour
or approved hour of credit for a seminar or self-study program.
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(9) "Department" - means the Delaware Department of Insurance.

(10) "Disciplinary action" - means administrative action that has been
taken against an individual or entity as a licensee or approved course
provider, instructor, or school official for which probation, suspension,
or revocation of any license (issued by this or any other state, country,
or territory) or approved status has been ordered or consented to or for
which a fine has been entered for a wrongdoing against a consumer.

(11) "Entity sponsor" - means a natural person, firm, institution,
partnership, company, corporation, or association offering, sponsoring, or
providing courses approved by the Department in eligible continuing
education subjects.

(12) "Ethics credits" - mean the study of fiduciary responsibility,
commingling of funds, payment and acceptance of commissions, unfair claims
practices, professionalism, policy replacement consideration, handling or
supervising the affairs or funds of another and conflicts of interest.

(13) "Hour" - means sixty (60) minutes of class or seminar time, of which
at least fifty (50) minutes must be instruction, with a maximum of ten
minutes of break per hour all of which must be accounted for on the agenda
or syllabus. For self-study courses, "hour" means sixty (60) minutes of
time including reading and studying which would be necessary to
successfully complete the final examination (actual exam time not
included).

(14) "Initially Licensed" - means the first insurance license issued an
individual by this Department authorizing the transaction of insurance
business in this state to which the continuing education requirement
applies.

(15) "Recognized association" - means an insurance industry association
established for at least 5 years.

(16) "School official" - means the person designated by the entity as
responsible for the timely filing of all required Department forms and
documentation for courses and for the maintenance of necessary
administrative records including but not limited to classes held,
examinations monitored, instructor qualifications, and attendance records.

(17) "Syllabus" - means an agenda showing the schedule of how a continuing
eduction course is to be presented including time allotment to subject
matter and including any meals and break times.

Section 4. Course Providers.

(a) Provider Approval. A provider who sponsors a continuing education
course must be approved by the Commissioner and shall be operated by,
including but not limited to, an authorized insurance company, a
recognized insurance agents' association, an insurance trade association, a
self-insurance fund, a non-profit educational institute, a member of a
state Bar Association, an independent program of instruction, or an
institution of higher learning. Application for entity approval shall be
concurrent with application for course approval and shall be submitted on
forms prescribed by Department. In assessing a provider's application for
approval, the Commissioner may consider, among other factors, whether the
management of a provider, including officers, directors, or any other
person who directly or indirectly controls the operation of the provider,
fails to possess and demonstrate the competence, fitness and reputation
deemed necessary to serve the provider in such position.

(b) General Requirements and Responsibilities.

(1) Providers shall maintain the records of each individual completing a
course for 4 years from the date of completion and shall upon request of
the Commissioner submit a course roster list of course attendees which
includes all information available on Form CE-4.

(2) Providers shall notify the Agent and Agency Licensing Education
Section, within thirty (30) days of a change in their mailing address or
administrative office address.

(3) Course providers will provide each licensee successfully completing
their program a Certificate of Completion/Course report form CE-4 in
accordance with Section 8(a)(4). It must contain, at a minimum:

a. Licensee's name

b. Social Security Number

c. Title of the educational activity

d. Delaware course number

e. Delaware sponsor number

f. Number of CEUs earned

g. Authorized signature of school official

(4) Course providers shall obtain the Commissioner's approval for each
course offered. A Course Report Form CE-4 shall be completed and
distributed to the licensee only after completion of the entire course.
Entity Sponsors are required to distribute course report forms to each
licensee successfully completing the educational activity within fifteen
(15) calendar days.

(5) No partial credit may be granted for any course unless an emergency
arises. In case of an emergency, a written explanation shall be provided to
the Commissioner upon request.

(6) Self-study courses shall contain an exam that shall be graded by the
sponsor or an approved third party. No credit shall be given for a failing
grade.

(7) One Continuing Education Credit shall consist of fifty (50) minutes of
qualifying classroom instruction.

(8) Course Providers are responsible for the
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actions of their school officials, instructors, speakers and monitors.

(9) Entity sponsors and instructors shall conduct themselves in a
professional manner and may not misrepresent any course material or other
information.

(10) Educational activities are approved for a term of 3 years unless
requested by the Commissioner to be resubmitted for approval.

(11) No activity may be advertised as having been approved until the
sponsor receives written notification from the Department. The use of
"approval pending" is acceptable advertising.

Section 5. Instructors.

The instructor shall possess one or more of the following qualifications:

(1) A minimum of 3 years working experience in the subject matter being
taught.

(2) An approved professional designation in accordance with Section 9(c)(1)
from a recognized association.

(3) A degree from an accredited school in the subject matter being taught.

(4) Special expertise, such as employment with a governmental entity; or a
documented history of research or study in the area.

(5) An instructor who is a licensee shall receive 2 times the number of
continuing education credits granted to participants. The instructor may
not receive additional credit for teaching the same course more than once
in a biennium reporting period.

(6) Instructors will have the authority and responsibility to deny credit
to anyone who disrupts the class or is inattentive. Based on the course
providers policies, refunds may be given. It will be a violation of this
regulation for an instructor or school official to knowingly allow during
the class, the activities of sleeping, reading of books, newspapers, or
other non-course materials, use of a cellular phone, or to allow absence
from class other than authorized breaks. Penalties will be assessed against
participant, instructor, and school, as provided in this regulation.
Approval of a course will constitute approval of submitted instructors.
Course submissions must include a narrative biography of each instructor.

Section 6. Commissioner's action upon violation or non-conformity by course
provider or instructor.

If the Commissioner determines that a course provider or instructor has
violated any provisions of this regulation, the Commissioner may withdraw
approval of the entity sponsor or instructor or may order a refund of
course fees to licensees who attended the course, or both. The Commissioner
may also refuse to approve courses conducted by specific sponsors or
instructors if the Commissioner determines that past offerings by those
entity sponsors or instructors have not been in compliance with insurance
education laws, rules and regulations. The Commissioner or his/her
designee(s) may perform course provider audits on all educational activity
proposed to be available to licensees of this State.

Section 7. Appeals

(a) Appeals shall be conducted in accordance with the Administrative
Procedures Act, 29 Del. C., Chapter 101 and Delaware Insurance Code.

(b) Providers may appeal to the Commissioner or Commissioner's designee,
from any adverse decision on their request concerning continuing education
activity. Appeals shall be in writing and minimally contain:

(1) A synopsis of the issue,

(2) The basis for the appeal,

(3) The name, address, and telephone number of a contact person,

(4) A copy of the original course submission and supporting documents, and

(5) A copy of any correspondence from the Continuing Education Advisory
Council or the Insurance Department.

Section 8. Required Forms.

Course Providers shall apply for registration, course submission, repeat
course submission and licensee certificate of completion (Delaware Course
Report Form) on forms prescribed and approved by the Commissioner. The
following forms apply unless or until revised by the Commissioner:

(1) Request for entity sponsor approval shall be made on Department Form
CE-1 (Attachment 1).

(2) Request for entity sponsor course approval shall be made on Department
Form CE-2 (Attachment 2).

(3) Course providers shall submit a Form CE-3 to the Department not less
than 7 days prior to the offering of any course that was previously
approved by the Department for an unspecified date or is to be repeated.
(Form CE-3 Attachment 3)

(4) Form CE-4 Course Report Form. Form CE-4 contents may be submitted in an
alternative format so long as prior approval is obtained.

(5) Continuing Education Course Evaluation Form CE-5. The Department may
request licensees to complete course evaluation forms as a means of
auditing a course and entity sponsor.
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Section 9. Licensee's Responsibility.

(a) Each licensee shall retain each original course completion/course
report form(s) CE-4 for a period of 3 years. The Form CE-4 may be required
in the event of a discrepancy between the licensee's records and the
Department's. Each licensee may be subjected to a Department audit of
continuing education requirements. Failure to comply with a Department
audit may result in suspension of a licensee's license. Pursuant to Section
8(5), the Department may require a licensee to complete a course evaluation
form.

(b) General Requirements. All resident licensees not otherwise exempted
shall earn, at a minimum, the number of education credits described below.

(1) All resident licensees required to fulfill continuing education
requirements shall complete twenty (20) credit hours of Department approved
education subjects, four (4) of which shall be in ethics subjects during
each biennium reporting period.

(2) Limited Representatives and Adjusters shall be required to fulfill ten
(10) credit hours of Department approved education subjects, four (4) of
which shall be in ethics subjects during each biennium reporting period.

(3) All resident licensees subject to this regulation shall file with the
Department a copy of their completed course report forms. Course report
form CE-4(s) must be received on or before March 20th following the
preceding biennium compliance date. Failure to timely file will result in
notice of suspension and fines under Section 10 of this regulation.

(4) All resident licensees will receive a continuing education transcript
at least ninety (90) days prior to the end of a license biennium and the
licensee is responsible for reviewing the transcript for accuracy. To
dispute the Department's accounting, the licensee must submit a written
exception thereto prior to the biennium deadline (February 28th of even
years) and include a copy of the course report form CE-4.

(5) The maximum number of carryover credits shall not exceed 5 credits.
Carryover shall not apply to ethics credit requirements. Ethics credits in
excess of the mandatory requirement may apply to non-ethics credit
requirements.

(6) Fulfillment of continuing education requirements includes completion of
approved subject matter and ethics requirements during the biennium.

(7) No continuing education requirement shall apply to newly licensed
individuals during the biennium in which such individuals are licensed. A
total of 5 credits in excess of 20 credits earned may apply to carryover
during the newly licensed biennium period.

(c) Automatic credit. For experience an individual continuously licensed
for twenty-five (25) years or longer
prior to the start of a biennium reporting period and/or for holding a
professional designation shall receive an automatic credit of ten (10)
credits in each biennium. Approved professional designations are the AAI,
CEBS, CLU, CPCU, ChFC, FLMI, CFP, FSPA, CIC and RHU. Automatic credits may
no be applied to satisfy ethics credit requirements.

(d) License reinstatement after suspension or revocation. All resident and
nonresident licensees whose licenses were canceled, suspended or revoked
for a period of twelve (12) months or more shall first complete all
licensing requirements under 18 Del. C. Section 1721 including the retaking
of all exams for the lines of authority under which the individual proposes
to transact insurance.

(e) Extension of time. For good cause shown, the Commissioner may grant an
extension of time during which the requirements imposed by this regulation
may be completed. The extension shall not exceed twelve (12) months. The
extension will not alter the requirements or due date of the succeeding
biennium period. "Good cause" includes disability, natural disaster, or
other extenuating circumstances. Each request for extension of time shall
be in writing from the licensee and shall include details and any
documentation to support the request. Each request must be received by the
Commissioner no less than thirty (30) days before the expiration of the
biennium period.

(f) Waiver of Continuing Education Requirements. The requirements of this
regulation may be waived in writing by the Commissioner for good cause
shown. "Good cause" includes long-term illness or incapacity, serving
full-time in the armed forces of the United States of America on active
duty outside of the state of Delaware, and any other emergency situations
deemed appropriate by the Commissioner. Request for waivers of continuing
education requirements shall be made in writing and shall be submitted to
the Commissioner no later than thirty (30) days prior to the end of the
biennium for which such waiver is requested. Any waiver granted pursuant to
this regulation shall be valid only for the biennium for which waiver
application was made.

(g) Exemptions to continuing education requirements:

(1) Agents licensed for the lines of title insurance or public carrier
insurance.

(2) Fraternal Agents.

(3) Interim Agents.

(h) Nonresident responsibilities.

(1) All nonresident licensees shall file a home state letter of
certification not more than ninety (90) days old when received by the
Commissioner, which provides evidence of license status and compliance with
continuing education requirements in his or her state of residence. The
filing requirement for nonresidents shall be on odd
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years with a deadline date of February 28th every odd year beginning in
year 1999.

(2) The Department will send renewal notices to all nonresident licensees
at least ninety (90) days before the end of the biennium. Nonresidents may
request a thirty (30) day extension to file for renewal provided it is in
writing to the Commissioner at least thirty (30) days prior to the biennium
deadline and shall provide evidence of seeking a home state letter of
certification.

(3) All nonresidents who fail to provide certification from home state
under this regulation shall be subjected to the same penalties as a
resident agent under this regulation pursuant to Section 10.

Section 10. Penalty for noncompliance.

(a) Pursuant to 18 Del. C. Sections 334, 1732, and 1734, any licensee who
fails to complete the minimum requirements of this regulation, and who has
not been granted an extension of time to comply under Section 9(e)(1) of
this regulation, shall be subject to an administrative penalty up to and
including a $2000.00 fine and suspension of license(s) for one year.
Submission of false or fraudulent information shall result in an
administrative penalty up to and including a $15,000.00 fine and permanent
revocation of license.

(b) Any appointment(s) of such licensee suspended for failure to comply
with this regulation shall likewise be suspended by operation of law. Upon
satisfactory completion of education requirements in arrears and payment of
any administrative fine imposed within a period of twelve (12) months, all
license(s) and appointments are reinstated unless or until the insurer
notifies the Commissioner and licensee in writing of the insurer's intent
to terminate such appointment. If suspension is for a period of twelve (12)
months or greater, the licensee is subjected to complying with 18 Del. C.
Section 1721 including the retaking of all examinations for line(s) of
authority that the individual proposes to transact insurance.

(c) The Commissioner may by Order require any individual licensed under 18
Del. C. Chapter 17 based upon reasonable belief that a violation of Title
18 occurred, to complete in addition to biennium insurance education
requirements, approved continuing education course work to ensure the
maintenance and improvement of a licensee's insurance skills and knowledge.

Section 11. Continuing Education Advisory Council

The Council shall consist of ten (10) licensees drawn from the professional
organizations in the State, 5 from the life and health field and 5 from the
property and casualty field.

(1) One of the primary responsibilities of the Council shall be to review
applications for course approvals and make recommendations to the
Commissioner regarding acceptance/ rejection and the number of CEUs to be
granted if accepted.

(2) The Council shall also advise the Commissioner on matters of concern as
they arise and provide liaison between the Department and the professional
organizations.

(3) Members shall serve a term of 2 years. Any member may be reappointed
for successive terms. The committee shall meet every 2 months on the third
Tuesday of the month or additionally as required. The members of the
committee shall serve without pay and shall not be reimbursed for any
expenses.

(4) All previously approved continuing education courses at the time this
regulation becomes effective shall resubmit for approval within twelve
months of the effective date of this regulation. Such courses must be
resubmitted for approval within twelve (12) months of the effective date of
this regulation.

(5) The final decision on each Entity Sponsor submission shall be the
Commissioner's.

Section 12. Separability

If any provision of this Regulation shall be held invalid, the remainder of
the Regulation shall not be affected thereby.

Section 13. Effective Date

This Regulation shall become effective March 1, 1998 and shall remain in
effect until rescinded. Prior to the aforementioned date the provisions of
Regulation 47 as last amended in 1987 shall remain in effect.
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INSURANCE DEPARTMENT

Statutory Authority: 18 Delaware Code,

Sections 314, 1726 (18 Del.C. §§ 314, 1726)

INSURANCE COMMISSIONER DONNA LEE H. WILLIAMS hereby gives notice that a
PUBLIC HEARING will be held on Thursday, February 26th, 1998 at 10:00 a.m.
in the 2nd Floor Conference Room of the Delaware Insurance Department at
841 Silver Lake Boulevard, Dover, DE 19904.

The purpose of the Hearing is to solicit comments from the industry, the
agent community, and the general public on the agent community's request to
strike the cap on agent commissions from Insurance Department Regulation
63,
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Section 24 relating to long term care insurance policies, which reads as
follows:

"Section 24. Permitted compensation arrangements

A. An insurer or other entity may provide commission or other compensation
to an agent or other representative for the sale of a long-term care
insurance policy or certificate which shall not exceed twenty-five percent
(25%) of the total premium paid for that policy year.

B. No entity shall provide compensation to its agents or other producers
and no agent or producer shall receive compensation greater than
twenty-five percent (25%) of the total premium paid for that policy year
for the sale of a replacement long-term care insurance policy or
certificate.

C. For purposes of this section, "compensation" includes pecuniary or
non-pecuniary remuneration or any kind relating to the sale or renewal of
the policy or certificate including but not limited to bonuses, gifts,
prizes, awards and finders fees."

The hearing will be conducted in accordance with the Delaware
Administrative Procedures Act, 29 Del. C. Chapter 101. Comments are being
solicited from any interested party. Comments may be in writing or may be
presented orally at the hearing. Written comments must be received by the
Department of Insurance no later than Thursday, February 19, 1998 and
should be addressed to Fred A. Townsend, III, Deputy Insurance
Commissioner, 841 Silver Lake Boulevard, Dover, DE 19904. Those wishing to
testify or those intending to provide oral testimony must notify Fred A.
Townsend, III at 302.739.4251, ext. 171 or 800.282.8611 no later than
Thursday, February 19, 1998.
Violent Crimes

Compensation Board

Statutory Authority: 11 Delaware Code,

Section 9004(4) (11 Del.C. 9004(4))

NOTICE IS HEREBY GIVEN THAT THE VIOLENT CRIMES COMPENSATION BOARD (VCCB)
WILL HOLD A PUBLIC HEARING ON WEDNESDAY, FEBRUARY 25, 1998 AT DEL TECH
COMMUNITY COLLEGE, TERRY CAMPUS, DOWNES LECTURE HALL AT 7:00 P.M. TO ADOPT
A NEW REGULATION EN

TITLED "MENTAL HEALTH PRACTITIONERS, QUALIFICATIONS, LICENSURE" AND TO MAKE
NON-SUBSTANTIVE CHANGES TO EXISTING REGULATIONS.

SHOULD YOU HAVE ANY QUESTIONS, PLEASE FEEL FREE TO CONTACT THE OFFICE AT
995-8383.

Existing Rules and Regulations:

INDEX

Rule No. I Definitions 2

Rule No. II Address of the Board; Office Hours 4

Rule No. III Statement of Goals 5

Rule No. IV The Secretary; Filing of Papers 6

Rule No. V Filing of Claims 7

Rule No. VI Burden of Proof 8

Rule No. VII Exhibits 9

Rule No. VIII Investigation of Claims 10

Rule No. IX Rules of Evidence 11

Rule No. X Hearings 12

Rule No. XI Attorneys 14

Rule No. XII Attorney Fees 15

Rule No. XIII Forms 16

Rule No. XIV Subpoenas, Etc 17

Rule No. XV Emergency Awards 18

Rule No. XVI Dependency 19

Rule No. XVII Appeal 20

Rule No. XVIII Denial of Claim; Reduction 21

Rule No. XIX Publication of Claims 22

Rule No. XX Availability of Rules 23

Rule No. XXI Construction of Rules 24

Rule No. XXII Amendments of Rules 25

Rule No. XXIII Quorum 26

Rule No. XXIV Meetings 27

Rule No. XXV Seal 28

Rule No. XXVI Mental Suffering Award 29

Rule No. XXVII Burial Awards 30

Rule No. XXVIII Mental Health

Counseling Award 31

* Please note that the above page numbers refer to the original document,
not to pages in the Register.

January 12, 1993

STATE OF DELAWARE

DELAWARE'S VIOLENT CRIMES COMPENSATION BOARD

RULES AND REGULATIONS

WHEREAS it is expedient to revise and recodify the rules and regulations of
the Violent Crimes Compensation
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Board of the State of Delaware,

NOW, THEREFORE, be it ordered as follows:

1. The rules as hereinafter set forth take effect and be in force in the
State of Delaware on and after June 1, 1978,

2. All rules existing prior to the date of this publication are hereby
repealed.

3. The laws of the State of Delaware shall be controlling in the event of
any conflict arising or existing between the law and the rules as set forth
in this publication and the Laws of the State of Delaware and amendments
thereto.

4. The use of the word Board as it appears in the rules of this publication
or as it may appear in any future amendments thereto shall mean the Violent
Crimes Compensation Board.

Ann L. DelNegro

Executive Director

Leah W. Betts, Chairwoman

Thomas W. Castaldi, Vice Chairman

Saxton C. Lambertson, Board Member

Stephen L. Manista, Board Member

Dennis P. Williams, Board Member

July 1, 1994

RULE 1 - DEFINITIONS

The definitions set forth in Title 11, Chapter 90 of the Delaware Criminal
Code are, hereby adopted by this Board, and incorporated by reference in
these rules which reads as follows:

Section 9002 "The following words, terms and phrases, when used in this
Act, shall have the meanings ascribed to them except where the context
clearly indicates a different meaning:

(A) `Board' shall mean the Violent Crimes Compensation Board as established
by this Act;

(B) `Child, shall mean an unmarried person who is under eighteen years of
age, and shall include the step-child or adopted child of the victim, or
child conceived prior to, but born after, the personal injury or death of
the victim.

(C) `Crime' for purposes of this Chapter shall mean:

(1) any specific offense set forth in Chapter 5 of the Delaware Criminal
Code as the same appears in Chapter 497, Volume 58, Laws of Delaware, if
the offense was committed after the effective date of said Criminal Code
and contains the characteristics of murder, rape, unlawful sexual
intercourse, unlawful sexual penetration
or unlawful sexual contact, manslaughter, assault, kidnapping, arson,
burglary, riot, robbery, unlawful use of explosives, or unlawful use of
firearms.

(2) any specific offense set forth in Chapter 3, Title 11 of the Delaware
Code if such offense was committed prior to the effective date of the
Delaware Criminal Code, as set forth in Chapter 497, Volume 58, Laws of
Delaware, and contains the characteristics of murder, rape, manslaughter,
assault, kidnapping, arson, burglary, robbery, riot, unlawful use of
explosives, or unlawful use of firearms.

(3) Any specific offense occurring in another state possession or territory
of the United States whose domicile is in Delaware is a victim, if the
offense contain the characteristics of murder, rape, manslaughter, assault,
kidnapping, arson, burglary, riot robbery, unlawful use of explosives or
unlawful use of firearms as set forth in Chapter 5 of this title. (66 Del.
Laws, c. 269, Section 11.)

(4) Any specific act of delinquency by a child, which if committed by an
adult would constitute a specific offense set forth in Chapter 5 of this
Title, and contains the characteristics of murder, rape, unlawful sexual
intercourse, unlawful sexual penetration or unlawful sexual contact,
manslaughter, assault, kidnapping, arson, burglary, robbery, riot, unlawful
use of explosives or unlawful use of firearms.

(D) `Dependent' shall mean a person wholly or substantially dependent upon
the income of the victim at the time of the victim's death, or would have
been so dependent but for the incompetency of the victim due to the injury
from which the death resulted, and shall include a child born after the
death of such victim;

(E) `Guardian' shall mean a person who is entitled by law or legal
appointment to care for and manage the person or property, or both, of a
child or incompetent;

(F) `Incompetent' shall mean a person who is incapable of managing his own
affairs, as determined by the Board or by a court of competent
jurisdiction;

(G) `Personal Injury' shall mean bodily harm, or extreme mental suffering,
and shall include pregnancy of the victim.

(H) `Pecuniary Loss' in instances of personal injury shall include medical
expenses, including psychiatric care, non-medical remedial care and
treatment rendered in accordance with a religious method of healing;
hospital expenses; loss of past earnings; and loss of future earnings
because of a disability resulting from such personal injury. `Pecuniary
Loss' in instances of death of the victim shall include funeral and burial
expenses and loss of support to the dependents of the victim. Pecuniary
loss includes any other expenses actually and necessarily incurred as a
result of the personal injury or death, but it does not include property
damage.

(I) `Victim' shall mean a person who is injured or
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killed by the act of any other person during the commission of a crime as
defined in this Chapter.

RULE II - ADDRESS OF THE BOARD; OFFICE HOURS

(A) All communications of the Board shall be addressed to the "Violent
Crimes Compensation Board, State of Delaware", at the office address of the
Board or such other address as the Board shall otherwise make known.

(B) The office of the Board will be open from 8:00 a.m. until 4:00 p.m. of
each weekday except legal holidays, and unless otherwise provided by
statute or Executive Order.

RULE III - STATEMENT OF GOALS

The Violent Crimes Compensation Board, hereby, declares that it serves a
public purpose, and is of benefit to the victims of violent crimes
committed within the State of Delaware, and in States that do not have a
funded Victim Compensation Program and it is the purpose of the Violent
Crimes Compensation Board to promote the public welfare by establishing a
means of meeting the additional hardships imposed upon the innocent victim
of certain crimes, and the family and dependents of those victims.

RULE IV - THE SECRETARY; FILING OF PAPERS

(A) The Secretary shall have custody of the Board's seal and official
records, and shall be responsible for the maintenance and custody of the
docket, files and records of the Board, and of its findings,
determinations, reports, opinions, orders, rules, regulations and approved
forms.

(B) All orders and other actions of the Board shall be authenticated or
signed by the Secretary or other person as may be authorized by the Board.

(C) All pleadings or papers required to be filed with the Board shall be
filed in the office of the Board within the time limit, if any, fixed by
law or Board rule for such filing; and similarly all requests for official
information, copies of official records, or opportunity to inspect public
records shall be made to the Secretary of the Board.

(D) Communications addressed to the Board and all petitions, and other
pleadings, all reports, exhibits, dispositions, transcripts, orders and
other papers or documents, received or filed in the office kept by the
Secretary, shall be stamped showing the date of the receipt or filing
thereof.

RULE V - FILING OF CLAIMS

In addition to all other statutory requisites, claims must be filed on
official forms which include subrogation, authorization, and consent
agreements in the office of the Violent Crimes Compensation Board, located
at 1500 E. Newport Pike, Suite 10, Wilmington, Delaware, 19804 within one
year of the date of the crime.

RULE VI - BURDEN OF PROOF

In compensation cases, the burden of proof shall be upon the petitioner, it
is also the victim's burden to prove that he was an innocent victim of a
violent crime, and that he cooperated in the apprehension and/or conviction
of the perpetrator of the crime.

RULE VII - EXHIBITS

Exhibits submitted at the Violent Crimes Compensation Board's hearings are
to be kept until passage for time of appeal. When time for appeal has
passed, the exhibits may be returned to their proper owner or destroyed.
This does not include medical reports which have been submitted into
evidence which shall remain as part of the case record.

RULE VIII - INVESTIGATION OF CLAIMS

All claimants must fully cooperate with investigators or representatives of
this agency in order to be eligible for an award. In the event that
cooperation is refused or denied, the Board may deny a claim for lack of
cooperation.

RULE IX - RULES OF EVIDENCE

The Board is not bound by the Rules of Evidence. Hearsay evidence is
admissible.

RULE X - HEARINGS

(A) Notice of hearings shall be posted in the office of the Violent Crimes
Compensation Board seven days prior to the scheduled hearing dates. special
meetings or rescheduled hearings shall be posted no later than 24 hours
prior to the scheduled time.

(B) The Board may receive as evidence, any statements, documents,
information or material, that they find is relevant and of such nature as
to afford the parties a fair hearing. The Board may also accept police
reports, hospital records and reports, physicians reports, etc., as proof
of the crime and injuries sustained, without requiring the presence of the
investigating officer or
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attending physician at the hearing.

(C) Subsequent to the claim being presented to the Board and a decision has
been rendered, the claimant, should they be dissatisfied with the decision,
may request a hearing before the Board. This request must be in writing and
within 15 days of the decision stating the reason for the disagreement.

(D) The Board may arrange for a medical or mental examination by a
physician designated by the Board. A written report of such examination
shall be filed by the attending physician with the Board. The physicians's
fee shall be paid directly by the Board.

(E) All witnesses shall testify under oath (or by affirmation), and a
record of the proceedings shall be recorded. The Board may examine the
claimant and all witnesses.

(F) Hearings shall be open to the public. However, the Board may hold
private hearings under the following circumstances:

(1) In a sexual offense where the welfare and interest of the victim or
dependents may be adversely affected.

(2) In the interest of public morality.

(3) Prosecution against the alleged perpetrator of the crime is pending and
no trial has been held.

(4) On written request by the claimant or counsel within five days before
the hearing for good cause.

(G) A claim under $5,000.00 may be heard by one Board Member

(H) A claim request to reopen and retain for additional medical that may be
needed as a result of the original crime may be heard by a quorum of the
Board. Adopted May 7, 1992

(I) A claim over 1 year in filing may be reviewed by one member to accept
for processing or deny.

(J) Under no circumstances shall the Board reopen or reinvestigate a case
after the expiration of two (2) years from the date of decision rendered by
the Board.

RULE XI - ATTORNEYS

Claimants have the right to be represented before the Board by an attorney
at law, licensed to practice in the State of Delaware. The attorney shall
file a notice of appearance.

Service upon the claimant's attorney shall be deemed as service on the
party he represents.

XII - ATTORNEY FEES

(A) The attorney representing a claimant before this Board must submit an
affidavit setting forth the total number of hours expended and describe the
nature of the work performed.

(B) The Attorney's fees shall not exceed $1,000.00.

(C) Attorney's fees shall be awarded at the discretion of the Board.

(D) Attorney's fees may be 15% of the total amount awarded to the victim,
but not to exceed $1000.00; or a fee based on the number of hours spent in
representing the claimant. Hourly fee rate to be determined by the Board.

(E) No prior agreement between an attorney and a client to pay the attorney
a fee out of the client's award will be honored by the Board. Any such
arrangement is unlawful.

(F) Upon application to the Board for attorney's fees, the service rendered
the injured victim, as well as the time spent and uniqueness of the case,
will be considered in determining the allowance of attorney's fees.

RULE XIII - FORMS

The Board shall prepare and furnish claim forms.

RULE XIV - SUBPOENAS, ETC.

Any Board member, and the Executive Director, shall have the power to
administer oaths, subpoena witnesses, and compel the production of books,
papers, -and records relevant to any investigation or hearing authorized by
Chapter 90, Section 9015, Title 11, of the Delaware Code.

The Board or any staff member may take, or request, affidavits and
dispositions of witnesses residing within or without of the State.

RULE XV - EMERGENCY AWARDS

The Board will make an emergency award only upon a showing of dire
necessity. The claimant, must, in writing, request an emergency award when
submitting his claim form and show just cause as to why such an award
should be considered. No such award will be made until the police report is
acquired.

RULE XVI - DEPENDENCY

All questions relating to dependency shall be determined in accordance with
Chapter 90 Section 9002, Title 11, of the Delaware Code which reads as
follows:

Section 9002(d) "Dependent shall mean a person who is wholly or
substantially dependent upon the income of the victim at the time of the
victim's death, or would have been so dependent but for the incompetency of
the victim due to the injury from which the death resulted, and shall
include a child born after the death of such victim."
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RULE XVII - APPEAL

All questions relating to an appeal shall be determined in accordance with
Chapter 90, Section 9005, Title 11, of the Delaware Code which reads as
follows:

Section 9005(c) "The Board is not compelled to provide compensation in any
case, nor is it compelled to award the full amount claimed. The Board may
make its award of compensation dependent upon such condition or conditions
as it deems desirable.

Any claimant who is aggrieved by the Board's decision concerning
compensation or any conditions attached to the award of such compensation
may appeal to the Superior Count within (30) thirty days of the decision of
the Board. Any appeal to Superior Court shall not be de novo."

RULE XVIII - DENIAL OF CLAIM; REDUCTION

All questions relating to denial of a claim shall be determined in
accordance with Chapter 90, Title 11, Section 9006, of the Delaware Code
which reads as follows:

"The Board shall deny payment of a claim for the following reasons:

(A) Where the claimant was the perpetrator of the crime on which the claim
is based, or was the principal involved in the commission of a crime at the
time when the personal injury upon which the claim is based was incurred.

(B) Where the claimant incurred the personal injury on which the claim is
based through collusion with the perpetrator of the crime.

(C) Where the claimant refused to give reasonable cooperation to state or
local law enforcement agencies in their efforts to apprehend or convict the
perpetrator of the crime in question.

(D) Where the claim has not been filed within one year after the personal
injury on which the claim is based, unless an extension is granted by the
Board.

(E) Where the claimant has failed to report the crime to a law enforcement
agency within 72 hours of its occurrence; provided, however, that the Board
in its discretion, may waive this requirement if the circumstances of the
crime render this requirement unreasonable as stated in the Del. Code
Section 9006(5) Title 11.

(F) Where the victim is the end result of a suicide.

(G) Where the victim has sustained injuries during a drugrelated crime in
which he or she was a participant.

In determining whether or not to make an award under the provisions of this
Chapter, or in determining the amount of any award, the Board may consider
any circumstances it deems to be relevant, including the behavior of the
victim which directly or indirectly
contributed to his injury or death; unless such injury or death resulted
from the victim's lawful attempt to prevent the commission of a crime or to
apprehend an offender.

If the victim bears any share of responsibility that caused his injury or
death, the Board shall reduce the amount of compensation in accordance with
its assessment of the degree of such responsibility attributable to the
victim. A claim may be denied or reduced, if the victim of the personal
injury in question, either through negligence or through willful and
unlawful conduct, substantially provoked or aggravated the incident, giving
rise to the injury.

RULE XIX - PUBLICATION OF CLAIMS

The Board may make public the official record of claims and reports.

RULE XX - AVAILABILITY OF RULES

The rules of the Board shall be available to the public at the office of
the Violent Crimes Compensation Board. A copy of these rules and
regulations shall be, on file with all the County law libraries.

RULE XXI - CONSTRUCTION OF RULES

These rules shall be liberally construed to accomplish the purpose of
Chapter 90, Title 11, of the Del. Code.

RULE XXII - AMENDMENTS OF RULES

New rules may be adopted and any rule may be amended or rescinded by the
Board at a regular or special meeting.

New rules, amendments, or revisions shall become effective the date
approved by the Board according to Chapter 90, Title 11, Section 9004(d),
of the Del. Code, which reads as follows:

"The Board shall have the following functions, powers, and duties:

Section 9004(d) `to adopt, promulgate, amend, and rescind such rules and
regulations as are required to carry out the provisions of this Chapter'."

RULE XXIII - QUORUM

Three members shall constitute a quorum for all hearings and business of
the Board, except a hearing in which the claimant has requested no more
than $5,000.00 compensation and in that instance a quorum of the Board
shall be one (1) member. Where an opinion is divided, the majority shall
prevail.
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RULE XXIV - MEETINGS

Meetings shall be held upon notice by the Chairman or the Executive
Director at such time and place directed.

(a) The Board will maintain a running agenda of all business matters to be
discussed and acted upon. Following the hearing of claims, the Board, at
its discretion and as time permits, may convene a session to address any
matters on its running agenda. In the event that the Board's running agenda
numbers three or more items, a meeting solely for the purpose of addressing
Board business shall be held within 30 days.

Adopted October 17, 1991. Revised January 7, 1993.

RULE XXV - SEAL

The Board shall have a seal for authentication of its orders, awards and
proceedings, upon which shall be inscribed the words VIOLENT CRIMES
COMPENSATION BOARD, STATE OF DELAWARE.

RULE XXVI - MENTAL SUFFERING AWARD

Maximum award for mental suffering is set at $2,500.00. Clarification of
this motion is that over the past two years there has been a substantial
increase in claims. The Board feels it is necessary to cap mental suffering
awards at $2,500.00 to insure an equitable distribution of funds for all
victims, and to initiate a uniformity and consistency in awarding mental
suffering claims with emphasis on counseling and rehabilitation.

This rule shall apply to crimes that occurred before February 11, 1992.
Revised October 17, 1991.

Rule XXVI removed by statute February 11, 1992.

RULE XXVII - BURIAL AWARDS

Funeral Expense awards are not to exceed $4500.00 including opening and
closing of the grave. A maximum award of $1,000.00 for the cemetery plot
and $500.00 maximum award for the grave marker and installation. Adopted
March 14, 1992.

Cost of flowers not to exceed $150.00 and is to be included in the maximum
amount of $4500.00 for funeral expenses. Adopted May 7, 1992.

RULE XXVIII - MENTAL HEALTH COUNSELING AWARD

(A) In the event of a claim for costs associated with mental health
counseling, the Board may, following initial review of the claim, award
counseling not to exceed three (3) months in duration and a total cost of
$1,250.00.

(B) In the event that additional counseling will be
required beyond the period provided for in Section (A), the claimant must
submit a request to the Board prior to the expiration of the initial award.
Failure to submit such request in a timely fashion may, at the Board's
discretion, result in the denial of such request and refusal to make
payment for treatment in excess of the initial award. Any request for a
mental health counseling award shall be accompanied by an evaluation and
treatment plan including, but not limited to:

(1) A determination that the need for counseling resulted directly from the
crime in question rather than a previously existing condition; and

(2) A statement or certification that the treatment will address only
crime-related injuries.

(C) The Board, at its discretion, may require production of any documents
it deems necessary to its determination of a request for a mental health
counseling award.

Leah W. Betts, Chairwoman

Thomas W. Castaldi, Vice Chairman

Saxton C. Lambertson, Member

Stephen L. Manista, Member

Dennis P. Williams, Member

March 23, 1995
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PROPOSED RULES:

INDEX

Rule No. I Definitions 2

Rule No. II Address of the Board; Office Hours 4

Rule No. III Statement of Goals 5

Rule No. IV The Secretary; Filing of Papers 6

Rule No. V Filing of Claims 7

Rule No. VI Burden of Proof 8

Rule No. VII Exhibits 9

Rule No. VIII Investigation of Claims 10

Rule No. IX Rules of Evidence 11

Rule No. X Hearings 12

Rule No. XI Attorneys 14

Rule No. XII Attorney Fees 15

Rule No. XIII Forms 16

Rule No. XIV Subpoenas, Etc. 17

Rule No. XV Emergency Awards 18

Rule No. XVI Dependency 19

Rule No. XVII Appeal 20

Rule No. XVIII Denial of Claim; Reduction 21

Rule No. XIX Publication of Claims 22

Rule No. XX Availability of Rules 23

Rule No. XXI Construction of Rules 24

Rule No. XXII Amendments of Rules 25
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Rule No. XXIII Quorum 26

Rule No. XXIV Meetings 27

Rule No. XXV Seal 28

Rule No. XXVI Mental Suffering Award 29

Rule No. XXVII Burial Awards 30

Rule No. XXVIII Mental HealthCounseling Award 31

Rule No. XXIX Mental Health Practitioner

Qualifications/Licensure

* Please note that the above page numbers refer to the original document,
not to pages in the Register.

STATE OF DELAWARE

DELAWARE'S VIOLENT CRIMES COMPENSATION BOARD

RULES AND REGULATIONS

WHEREAS it is expedient to revise and recodify the rules and regulations of
the Violent Crimes Compensation Board of the State of Delaware,

NOW, THEREFORE, be it ordered as follows:

l. The rules as hereinafter set forth take effect and be in force in the
State of Delaware on and after June 1, 1978.

2. All rules existing prior to the date of this publication are hereby
repealed.

3. The laws of the State of Delaware shall be controlling in the event of
any conflict arising or existing between the law and the rules as set forth
in this publication and the Laws of the State of Delaware and amendments
thereto.

4. The use of the word Board as it appears in the rules of this publication
or as it may appear in any future amendments thereto shall mean the Violent
Crimes Compensation Board.

5. Rules of Regulations of the Violent Crimes Compensation Board shall be
adopted according to the requirements of the Administrative Procedure Act,
29 Del. Laws, c. 101, Subchapter I & II.

Ann L. DelNegro

Executive Director

Thomas W. Castaldi, Chairman

Saxton C. Lambertson, Vice Chairman

Leah W. Betts, Board Member

V. Lynn Gregory, Board Member

Stephen L. Manista, Board Member

RULE 1 - DEFINITIONS

The definitions set forth in Title 11, Chapter 90 of the
Delaware Criminal Code are, hereby adopted by this Board, and incorporated
by reference in these rules which reads as follows:

Section 9002 "The following words, terms and phrases, when used in this
Act, shall have the meanings ascribed to them except where the context
clearly indicates a different meaning:

9002. Definitions.

The following words, terms and phrases, when used in this chapter, shall
have the meanings ascribed to them except where the context clearly
indicates a different meaning:

(1) "Board" shall mean the Violent Crimes Compensation Board as established
by this chapter.

(2) "Child" shall mean an unmarried person who is under 18 years of age,
and shall include the stepchild or adopted child of the victim, or child
conceived prior to, but born after, the personal injury or death of the
victim.

(3) "Crime" for purposes of this chapter shall mean:

a. Any specific offense set forth in Chapter 5 of this title, if the
offense was committed after July 1, 1973, and contains the characteristics
of murder, rape, unlawful sexual intercourse, unlawful sexual penetration
or unlawful sexual contact, manslaughter, assault, kidnaping, arson,
burglary, riot, robbery, unlawful use of explosives or unlawful use of
firearms;

b. Any specific offense set forth in former Chapter 3 of this title, if
such offense was committed prior to July 1, 1973, and contains the
characteristics of murder, rape, manslaughter, assault, kidnaping, arson,
burglary, robbery, riot, unlawful use of explosives or unlawful use of
firearms;

c. Any specific offense occurring in another state, possession or territory
of the United States in which a person whose domicile is in Delaware is a
victim, if the offense contains the characteristics of murder, rape,
manslaughter, assault, kidnaping, arson, burglary, riot, robbery, unlawful
use of explosives or unlawful use of firearms as set forth in Chapter 5 of
this title;

d. Any specific act of delinquency by a child, which if committed by an
adult would constitute a specific offense set forth in Chapter 5 of this
title, and contains the characteristics of murder, rape, unlawful sexual
intercourse, unlawful sexual penetration or unlawful sexual contact,
manslaughter, assault, kidnaping, arson, burglary, robbery, riot, unlawful
use of explosives or unlawful use of firearms; or

e. An act of terrorism, as defined in Section 2331 of Title 18, United
States Code, committed outside the United States against a resident of this
State. (Effective date of amendment 4/8/97.)
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(4) "Dependent" shall mean a person wholly or substantially dependent upon
the income of the victim at the time of victim's death, or would have been
so dependent but for the incompetency of the victim due to the injury from
which the death resulted, and shall include a child born after the death of
such victim.

(5) "Guardian" shall mean a person who is entitled by law or legal
appointment to care for and manage the person or property, or both, of a
child or incompetent.

(6) "Incompetent" shall mean a person who is incapable of managing the
person's own affairs, as determined by the Board or by a court of competent
jurisdiction.

(7) "Personal injury" shall mean bodily harm, or extreme mental suffering,
and shall include pregnancy of the victim.

(8) "Pecuniary loss" in instances of personal injury shall include medical
expenses, including psychiatric care and mental health counseling of the
victim or secondary victims; nonmedical remedial care and treatment
rendered in accordance with a religious method of healing; hospital
expenses; loss of past earnings; and loss of future earnings because of a
disability resulting from such personal injury. "Pecuniary loss" in
instances of death of the victim shall include funeral and burial expenses,
loss of support to the dependents of the victim and mental health
counseling to secondary victims. "Pecuniary loss" includes any other
expenses actually and necessarily incurred as a result of the personal
injury or death, but it does not include property damage.

(9) "Victim" shall mean a person who is injured or killed by the act of any
other person during the commission of a crime as defined in this chapter.

(10) "Secondary victims" shall mean any parent, son, daughter, spouse,
brother or sister of the victim.

RULE II - ADDRESS OF THE BOARD; OFFICE HOURS

(A) All communications of the Board shall be addressed to the "Violent
Crimes Compensation Board, State of Delaware", at the office address of the
Board or such other address as the Board shall otherwise make known.

(B) The office of the Board will be open from 8:00 a.m. until 4:00 p.m. of
each weekday except legal holidays, and unless otherwise provided by
statute or Executive Order.

RULE III - STATEMENT OF GOALS

The Violent Crimes Compensation Board, hereby, declares that it serves a
public purpose and is of benefit to:

1. individuals who are victimized within the State of
Delaware;

2. Delaware residents who are victimized without the State of Delaware in
possessions or territories of the United States not having eligible crime
victim compensation programs;

3. Delaware residents who are victimized during acts of terrorism committed
outside the United States.

The Violent Crimes Compensation Board shall promote the welfare of victims
of crime by establishing a means of meeting the additional hardships
imposed upon the innocent victims of certain crimes, and the family and
dependents of those victims.

RULE IV - THE SECRETARY; FILING OF PAPERS

(A) The Secretary shall have custody of the Board's seal and official
records, and shall be responsible for the maintenance and custody of the
docket, and records of the Board including its verbal and written findings,
determinations, reports, opinions, orders, rules and regulations, and
approved forms.

(B) All orders and other actions of the Board shall be authenticated or
signed by the Secretary or other person as may be authorized by the Board.

(C) All pleadings or papers required to be filed with the Board shall be
filed in the office of the Board within the time limit, if any, fixed by
law or Board rule for such filing; and, similarly,

(D) Crime victims case files and records maintained by the Violent Crimes
Compensation Board shall fall under the open records provision of the
Freedom of Information Act, 29 Del. Laws, c. 100.

(E) Communications addressed to the Board, and all petitions and other
pleadings; all reports; exhibits; dispositions; transcripts; orders; and
other papers or documents, received or filed in the office and kept by the
Secretary, shall be stamped showing the date of the receipt or filing
thereof.

RULE V - FILING OF CLAIMS

In addition to all other statutory requisites, claims must be filed on
official forms which include subrogation, authorization, and consent
agreements in the office of the Violent Crimes Compensation Board, located
at 1500 E. Newport Pike, Suite 10, Wilmington, Delaware, l9804 within one
year of the date of the crime.

RULE VI - BURDEN OF PROOF

In compensation cases, the burden of proof shall be upon the petitioner. It
is the victim's burden to prove that he/she was an innocent victim of a
violent crime, and that
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he/she cooperated in the apprehension and/or conviction of the perpetrator
of the crime.

RULE VII - EXHIBITS

Exhibits and case file documents submitted prior to or after the Violent
Crimes Compensation Board's hearings shall be maintained in accordance with
the provisions of the Department of State, Bureau of Archives and Records
Management.

RULE VIII - INVESTIGATION OF CLAIMS

All claimants must fully cooperate with investigators or representatives of
this agency in order to be eligible for an award. In the event cooperation
is refused or denied, the Board may deny a claim for lack of cooperation.

RULE IX - RULES OF EVIDENCE

The Board is not bound by the Rules of Evidence. Hearsay evidence is
admissible.

RULE X - HEARINGS

(A) Notice of hearings shall be posted in the office of the Violent Crimes
Compensation Board at least seven days prior to the scheduled hearing date.
Special meetings or rescheduled hearings shall be posted no later than 24
hours prior to the scheduled time.

(B) The Board may receive as evidence, any statements, documents,
information, or material it finds relevant and of such nature as to afford
the claimant a fair hearing. The Board may also accept police reports,
hospital records and reports, physicians reports, etc. as proof of the
crime and injuries sustained, without requiring the presence of the
investigating officer or attending physician at the hearing.

(C) Any claimant may request to be heard by the Board following the initial
claim hearing, if he/she is dissatisfied with the decision of the Board.
The request to be heard before the Board must be in writing and must be
received in the office of the Violent Crimes Compensation Board within 15
days of the Board's decision. The written statement must include any and
all reasons for the dissatisfaction.

(D) The Board may arrange for a medical or mental health examination by a
physician designated by the Board. A written report of such examination
shall be filed by the attending physician with the Board. The physicians's
fee shall be paid directly by the Board.

(E) All witnesses shall testify under oath (or by affirmation), and a
record of the proceedings shall be recorded. The Board may examine the
claimant and all
witnesses.

(F) Claim hearings shall be open to the public. However, the Board may hold
private deliberations under the following circumstances:

(1) When the claim to be considered derives from any sexual offense;

(2) When the claim to be considered derives from any offense by a child
unless such child has been deemed amenable to the jurisdiction of a
criminal court;

(3) When the claim to be considered derives from any matter not yet
adjudicated.

(G) A claim under $5,000.00 may be heard by one Board Member

(H) A request to reopen a claim may be heard by one Member if the reopen
request for compensation is less than $5,000.00. If the reopen request for
compensation is more than $5,000.00, the request to reopen shall be heard
by a quorum of the Board.

(I) If a claim is filed more than one (1) year after the crime occurrence,
the claim may be reviewed by one member to accept or deny for processing.

(J) Under no circumstances shall the Board reopen or reinvestigate a case
after the expiration of two (2) years from the date of decision rendered by
the Board.

RULE XI - ATTORNEYS

All claimants have the right to be represented before the Board by an
attorney, who is licensed to practice law in the State of Delaware. The
attorney shall file a notice of appearance.

Service upon the claimant's attorney shall be deemed as service on the
party he/she represents.

XII - ATTORNEY FEES

(A) The attorney representing a claimant before this Board must submit an
affidavit setting forth the total number of hours expended and describe the
nature of the work performed.

(B) The attorney's fee shall not exceed $l,000.00.

(C) Attorney fees shall be awarded at the discretion of the Board.

(D) Attorney fees may be 15% of the total amount awarded to the victim, but
shall not exceed $1000.00; or may be a fee based on the number of hours
spent in representing the claimant. Hourly fee rates shall be determined by
the Board.

(E) No prior agreement between an attorney and a client to pay the attorney
a fee out of the client's award will be honored by the Board. Any such
arrangement is unlawful.

(F) Upon application to the Board for attorney fees, the service rendered
the injured victim, as well as the time
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spent and uniqueness of the case, will be considered in determining the
allowance of attorney fees.

RULE XIII - FORMS

The Board shall prepare and furnish claim forms and brochures.

RULE XIV - SUBPOENAS, ETC.

Any Board member, and the Executive Director, shall have the power to
administer oaths, subpoena witnesses, and compel the production of books,
papers, and records relevant to any investigation or hearing authorized by
11 Del. Laws, C. 90, Section 9015.

The Board or any staff member may take, or request, affidavits and
dispositions of witnesses residing within or without of the State.

RULE XV - EMERGENCY AWARDS

The Board will make an emergency award only upon a showing of dire
necessity. The claimant, must, in writing, request an emergency award when
submitting his/her claim form and show just cause as to why such an award
should be considered. No such award will be made until the police report is
acquired.

RULE XVI - DEPENDENCY

All questions relating to dependency shall be determined in accordance with
11 Del. Laws, C. 90, Section 9002 of the Delaware Code which reads as
follows:

Section 9002(d) "Dependent shall mean a person who is wholly or
substantially dependent upon the income of the victim at the time of the
victim's death, or would have been so dependent but for the incompetency of
the victim due to the injury from which the death resulted, and shall
include a child born after the death of such victim."

RULE XVII - APPEAL

All questions relating to an appeal shall be determined in accordance with
11 Del. Laws, C 90, Section 9005 of the Delaware Code which reads as
follows:

Section 9005(c) "The Board is not compelled to provide compensation in any
case, nor is it compelled to award the full amount claimed. The Board may
make its award of compensation dependent upon such condition or conditions
as it deems desirable. Any claimant who is aggrieved by the Board's
decision concerning

compensation or any conditions attached to the award of such compensation
may appeal to the Superior Count within (30) thirty days of the decision of
the Board. Any appeal to Superior Court shall not be de novo."

RULE XVIII - DENIAL OF CLAIM; REDUCTION

All questions relating to the denial of a claim shall be determined in
accordance with 11 Del. Laws, c. 90, Section 9006, of the Delaware Code
which reads as follows:

(a) The Board shall deny payment of a claim for the following reasons:

(1) Where the claimant was the perpetrator of the crime on which the claim
is based, or was a principal involved in the commission of a crime at the
time when the personal injury upon which the claim is based was incurred;

(2) Where the claimant incurred the personal injury on which the claim is
based through collusion with the perpetrator of the crime;

(3) Where the claimant refused to give reasonable cooperation to state or
local law-enforcement agencies in their efforts to apprehend or convict the
perpetrator of the crime in question;

(4) Where the claim has not been filed within 1 year after the personal
injury on which the claim is based, unless an extension is granted by the
Board;

(5) Where the claimant has failed to report the crime to a law enforcement
agency within 72 hours of its occurrence; provided, however, that the
Board, in its discretion, may waive this requirement if the circumstances
of the crime render this requirement unreasonable.

(6) Where the victim is injured as a result of their own suicide or
attempted suicide;

(7) Where the victim has sustained injuries during a drug-related crime in
which the victim was an illegal participant.

(8) Where the victim is delinquent in the payment of any penalty assessment
levied pursuant to Section 9012 of this title, or in the payment of an
order of restitution payable to the Victim Compensation Fund; provided,
however, that the Board may condition payment of a claim upon the
satisfaction of such delinquencies. In addition, the Board may, for
hardship or other good cause, waive the provisions of this paragraph in
their entirety.

(b) In determining whether or not to make an award under this chapter, or
in determining the amount of any award, the Board may consider any
circumstances it deems to be relevant, including the behavior of the victim
which directly or indirectly contributed to injury or death, unless such
injury or death resulted from the victim's lawful attempt to prevent the
commission of a crime or to apprehend an offender.
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(c) If the victim bears any share of responsibility that caused injury or
death, the Board shall reduce the amount of compensation in accordance with
its assessment of the degree of such responsibility attributable to the
victim. A claim may be denied or reduced, if the victim of the personal
injury in question, either through negligence or through willful and
unlawful conduct, substantially provoked or aggravated the incident giving
rise to the injury.

RULE XIX - PUBLICATION OF CLAIMS

The Board shall maintain confidentiality of records in accordance with the
open records provision of the Freedom of Information Act, 29 Del. Laws, c.
100.

RULE XX - AVAILABILITY OF RULES

The rules of the Board shall be available to the public at the office of
the Violent Crimes Compensation Board. A copy of these rules and
regulations shall be on file with all the County and State law libraries.

RULE XXI - CONSTRUCTION OF RULES

These rules shall be liberally construed to accomplish the purpose of 11
Del. code, C. 90.

RULE XXII - AMENDMENTS OF RULES

In accordance with 11 Del. Laws, C. 90, Section 9004(d):

"The Board shall have the following functions, powers, and duties:

Section 9004(d) to adopt, promulgate, amend, and rescind such rules and
regulations as are required to carry out the provisions of this Chapter."

New rules may be adopted and any rules may be amended or rescinded by the
Board at a regular or special meeting following compliance with the
Administrative Procedures Act, 29 Del. Laws, C. 101, Subchapter I & II.

RULE XXIII - QUORUM

Three members shall constitute a quorum for all hearings and business of
the Board, except a hearing in which the claimant has requested no more
than $5,000.00 compensation, and in that instance a quorum of the Board
shall be one (1) member.

Where an opinion is divided, majority rule shall prevail.

RULE XXIV - MEETINGS

Meetings shall be held upon proper notice by the Chairman or the

Executive Director at such time and place directed.

(a) The Board will maintain a running agenda of all business matters to be
discussed and acted upon. Following the hearing of claims the Board, at its
discretion and as time permits, may convene a session to address any
matters on its running agenda.

(b) A meeting solely for the purpose of addressing Board business shall be
held within 30 days to address any three or more new business topics.
Adopted October 17, 1991. Revised January 7, 1993.

RULE XXV - SEAL

The Board shall have a seal for authentication of its orders, awards and
proceedings, upon which shall be inscribed the words - VIOLENT CRIMES
COMPENSATION BOARD, STATE OF DELAWARE.

RULE XXVI - MENTAL SUFFERING AWARD

Maximum award for mental suffering is set at $2,500.00. Clarification of
this motion is that over the past two years there has been a substantial
increase in claims. The Board feels it is necessary to cap mental suffering
awards at $2,500.00 to insure an equitable distribution of funds for all
victims, and to initiate a uniformity and consistency in awarding mental
suffering claims with emphasis on counseling and rehabilitation.

This rule shall apply to crimes that occurred before February 11, 1992.
Revised October 17, 1991.

Rule XXVI removed by statute February 11, 1992.

RULE XXVII - BURIAL AWARDS

The aggregate award for funeral and burial shall not exceed $6,000.00
including:

A.) Funeral expenses, including opening and closing of the grave at
$4,500.00 maximum;

B.) Cemetery plot at $1,000.00 maximum;

C.) Grave marker including installation at $500.00 maximum. Adopted March
14, 1992.

Cost of flowers not to exceed $150.00 and is to be included in the maximum
amount of $4500.00 for funeral expenses. Adopted May 7, 1992.
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RULE XXVIII - MENTAL HEALTH COUNSELING AWARD

(A) In the event of a claim for costs associated with mental health
counseling, the Board may, following initial review of the case, award
counseling not to exceed three (3) months in duration and a total cost of
$1,250.00.

(B) In the event that additional counseling will be required beyond the
period provided for in Section (A), the claimant must submit a request to
the Board prior to the expiration of the initial award. Failure to submit
such request in a timely fashion may, at the Board's discretion, result in
the denial of such request and refusal to make payment for treatment in
excess of the initial award. Any request for a mental health counseling
award shall be accompanied by an evaluation and treatment plan including,
but not limited to:

(1) A determination that the need for counseling resulted directly from the
crime in question rather than a previously existing condition; and

(2) A statement or certification that the treatment will address only
crime-related injuries.

(C) The Board, at its discretion, may require production of any documents
it deems necessary to its determination of a request for a mental health
counseling award.

RULE XXIX - MENTAL HEALTH PRACTITIONER QUALIFICATIONS/LICENSURE

To be eligible for crime victim's compensation for mental health counseling
treatment, within and without the State of Delaware, treatment must be
provided by a practitioner possessing an advanced degree in an applied
mental health discipline. The advanced degree should be in Psychology,
Social Work, Counseling, or Psychiatric Nursing.

To be eligible for crime victim's compensation for mental health counseling
treatment in the State of Delaware, services must be provided by a licensed
mental health practitioner. The four disciplines recognized by the Violent
Crimes Compensation Board for payment of mental health counseling benefits
are: Licensed Psychiatrist; Licensed Psychologist; Licensed Clinical Social
Worker; Licensed Mental Health Counselor; and Licensed Clinical Nurse
Specialist.

Payment for mental health treatment received outside the State of Delaware
will be evaluated for licensure on a case-by-case basis by the Violent
Crimes Compensation Board.

Department of Administrative Services

Division of Professional Regulation

Delaware Council on Real Estate Appraisers

Statutory Authority: 24 Delaware Code,

Section 2934(a) (24 Del.C. 2934(a))

PROPOSED RULES AND REGULATIONS

DELAWARE COUNCIL ON REAL ESTATE APPRAISERS

TABLE OF CONTENTS

SECTION PAGE

SECTION 1 - APPLICATION FOR APPRAISER LICENSE OR CERTIFICATE

1.01 Application 1

1.02 Filing and Fees 1

SECTION 2 - APPRAISER LICENSING AND CERTIFICATION

2.01 Qualifications for Appraiser

Licensure and Certification 2

2.02 License and Certificate Renewal 3

2.03 Continuing Education 3

2.04 Inactive Status 4

2.05 Expired License or Certificate 5

2.06 Payment of License and Certificate Fees 5

2.07 Duplicate License or Certificate Fee 5

2.08 Federal Appraiser Registry 6

SECTION 3 - EXAMINATION

3.01 Examination 6

SECTION 4 - GENERAL APPRAISAL PRACTICE

4.01 Appraisal Office Administration 7

4.02 Supervision of State Licensed

Appraiser Trainees 9

4.03 Supervision of Licensed or Certified

Residential Appraisers and Trainees 13

4.04 Use of Titles 14

4.05 Display of License and Certificates 15

4.06 Advertising 15

4.07 Change of Name or Address 16
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4.08 Appraisal Reports 16

SECTION 5 - TEMPORARY PRACTICE & RECIPROCITY

5.01 Temporary Practice 17

5.02 Reciprocity 17

SECTION 6 - QUALIFYING MASS APPRAISAL EXPERIENCE

6.01 Qualifying Mass Appraisal Experience 18

6.02 Mass Appraisal Experience Log 22

SECTION 7 - STANDARDS OF APPRAISAL PRACTICE

7.01 Appraisal Standards 24

SECTION 8 - COMPLAINTS; HEARING PROCEDURES; FINAL DECISIONS

8.01 Complaints 25

8.02 Hearing Procedures 25

8.03 Transcripts 27

8.04 Return of Documentary Evidence 27

8.05 Final Decision 28

SECTION 9 - PUBLIC DISCLOSURE

9.01 Public Notice 28

9.02 Meeting Minutes 29

9.03 Council Records 29

SECTION 10 - CHANGE AND MODIFICATION TO RULES AND REGULATIONS

10.01 Changes/Modifications 30

SECTION 11 - SEVERABILITY

11.01 Severability 30

* Please note that the above page numbers refer to the original document,
not to pages in the Register.

SECTION 1 - APPLICATION FOR APPRAISER LICENSE OR CERTIFICATE

1.01 APPLICATION

A person who wishes to file an application for a real property appraiser
license or certificate may obtain the required form upon request to the
Council. In general, the form calls for information such as the applicant's
name and address, the applicant's social security number,
places of residence and employment, experience, education, and other
information as may be necessary to identify the applicant and review the
applicant's qualifications for licensure or certification.

1.02 FILING AND FEES

A. Properly completed applications together with the appropriate fee(s)
must be received in the Council's office prior to scheduling the
examination.

B. A fee set by the Division of Professional Regulation will be charged for
the following:

1. Initial application and licensure for appraiser trainee license

2. Initial application and licensure for licensed real property appraiser
license

3. Initial application and certification for certified residential real
property appraiser certificate

4. Initial application and certification for certified general real
property appraiser certificate

5. Renewal fee

6. Duplicate license and certificate fee

7. Inactive status fee

8. Roster fee

9. Printing fee

10. Federal Appraiser Registry fee

11. Letter of Good Standing

12. Copies of the Uniform Standards of Professional Appraisal Practice

C. Fees shall be made payable to the "State of Delaware," and mailed to the
Delaware Council on Real Estate Appraisers, Cannon Building, Suite 203, 861
Silver Lake Boulevard, Dover, Delaware 19904. For further information,
please contact the Administrative Assistant to the Council at (302)
739-4522.

SECTION 2 - APPRAISER LICENSING AND CERTIFICATION

2.01 QUALIFICATIONS FOR APPRAISER LICENSURE AND CERTIFICATION

A. Applicants for certification as a state certified general or residential
real property appraiser and for licensed real property appraiser must
satisfy the qualification requirements stated in Chapter 29, Title 24,
Section 2934, Delaware Code, which adopts by reference "Title XI of the
Financial Institutions Reform, Recovery, and Enforcement Act of 1989, and
any subsequent amendments thereto or any regulations promulgated
thereunder" and "qualification criteria established by the Appraiser
Qualifications Board of the Appraisal Foundation and any subsequent
amendments thereto."

B. Applicants for licensure as a state licensed appraiser trainee shall
have successfully completed a minimum of 45 classroom hours of education on
real
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estate matters satisfactory to the Council, of which fifteen (15) classroom
hours shall be on the topic of the Code of Professional Ethics and Uniform
Standards of Professional Appraisal Practice.

2.02 LICENSE AND CERTIFICATE RENEWAL

A. In September of each odd numbered year, the Division of Professional
Regulation will send renewal notices to the mailing address on file of all
licensed and certified appraisers. Certificates and licenses will expire on
October 31st of each odd numbered year.

B. As a condition of renewal, all licensees and certificate holders, either
active or inactive, resident or reciprocal, shall be required to satisfy
the continuing education requirements set forth in rule 2.03 of this
Section.

C. Any person who acts or professes to be a state licensed or state
certified real property appraiser while their appraiser license or
certificate has expired will be subject to disciplinary action and
penalties as described in Chapter 29, Title 24, of the Delaware Code.

2.03 CONTINUING EDUCATION

A. As a prerequisite to renewal of a real property appraiser license or
certificate, the licensee or certificate holder shall present evidence
satisfactory to the Council of having completed during the immediately
preceding two (2) years, the number of classroom hours of instruction,
approved by the Council as set by the Appraiser Qualifications Board (AQB)
as from time-to-time amended, as provided by 24 Del. C. Section 2934(c).

B. As a prerequisite to renewal of a license, certificate and trainee
license, a seminar dealing with updating of Uniform Standards of
Professional Appraisal Practice (USPAP) or a seminar dealing with USPAP
shall be required in each license period. A minimum of four (4) hours will
be required. The seminars must be approved by the Council.

2.04 INACTIVE STATUS

A. A licensee or certificate holder may request to be placed on inactive
status for a period not to exceed two (2) years. Such request shall be
directed to the Council and shall be in writing. Upon written request to
the Council, a licensee or certificate holder shall be placed on inactive
status for a period not to exceed two (2) years. The Council may grant
extensions if the licensee or certificate holder shows due cause.

B. A licensee or certificate holder on inactive status shall not be
entitled to act as a state licensed or state certified real property
appraiser. However, in order to continue to hold an appraiser license or
certificate, a licensee or certificate holder on inactive status must renew
his/her license or certificate, including payment of
the prescribed renewal fee and completion of all continuing education.

C. A licensee or certificate holder on inactive status may request to be
returned to active status at any time. Such request shall be directed to
the Council and shall be in writing. Upon written request to the Council
and payment of all necessary fees, a licensee or certificate holder on
inactive status shall be returned to active status.

2.05 EXPIRED LICENSE OR CERTIFICATE

A. Expired real property appraiser licenses and certificates may be
reinstated within twelve (12) months after expiration upon proper
application and payment of the renewal fee plus a late filing fee as set by
the Division of Professional Regulation.

B. Licenses and certificates expired for more than twelve (12) months may
be considered for reinstatement upon proper application, payment of the
renewal fee plus late filing fee, provision of proof of having obtained
continuing education equal to the total number of classroom hours that
would have been required had the license or certificate been continuously
renewed, and successful completion of the examination as required in
Section 3 herein. Further, the reinstatement application must meet the
current requirements of the AQB for education and experience.

2.06 PAYMENT OF LICENSE AND CERTIFICATE FEES

Checks in payment of real property appraiser license and certificate fees
which are returned unpaid shall be considered cause for license or
certificate denial, suspension, or revocation.

2.07 DUPLICATE LICENSE OR CERTIFICATE FEE

By submitting a written request to the Council and paying the appropriate
fee as set by the Division of Professional Regulation, a licensee or
certificate holder may obtain a duplicate real property appraiser license,
certificate or pocket card to replace an original license, certificate or
pocket card which has been lost, damaged, destroyed, or if the name of the
licensee or certificate holder has been lawfully changed. An official copy
(notarized) of a marriage license, divorce decree or court order of a name
change must accompany a request for a change of name.

2.08 FEDERAL APPRAISER REGISTRY

Licensees and certificate holders are required to be enrolled in the
federal roster or registry of state licensed and state certified real
property appraisers. The fee established for that purpose shall be paid
annually by the license or certificate holder to the State of Delaware.
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SECTION 3 - EXAMINATION

3.01 EXAMINATION

A. The Council shall review each application to determine whether the
applicant is qualified to sit for the examination. Such review shall
consider the applicant's education and whether the applicant has been
convicted of a felony, substance abuse or fraud within the last five years
preceding the date of application. If the applicant meets the education
requirement for the license or certificate applied for and has not been
convicted of a felony, substance abuse or fraud within the last five years
preceding the date of application, the applicant shall be entitled to take
the appropriate examination.

B. Applicants for licensure as a state licensed real property appraiser and
for certification as a state certified residential or general real property
appraiser shall successfully complete the examination as endorsed by the
AQB and approved by the Council on Real Estate Appraisers. The
prerequisites to sit for the applicable

examination are completion of the education/classroom hour requirement and
not having been convicted of a felony, substance abuse or fraud within the
five years preceding the date of the application.

C. For the examination to be considered valid, the experience requirement
must be satisfied within two (2) years of the date of successful completion
of the examination. Should the experience requirement not be met within the
two (2) year period, the examination will be considered invalid and it will
be necessary to re-apply and pay the required fee as if no examination had
been taken.

D. The passing scores on the examinations shall be the scores recommended
as passing by Assessment Systems, Inc., the successor agency or company
then contracted by the Division of Professional Regulation for
administering the examination as endorsed by the Council on Real Estate
Appraisers.

SECTION 4 - GENERAL APPRAISAL PRACTICE DUTIES AND RESPONSIBILITIES OF STATE
LICENSED APPRAISER TRAINEES; SUPERVISION OF STATE LICENSED APPRAISER
TRAINEES; TRAINEE LICENSE RENEWALS

4.01 APPRAISAL OFFICE ADMINISTRATION

A. A certified or licensed appraiser shall be designated as the supervisory
appraiser by each appraisal firm, each combined real estate brokerage and
appraisal firm, and each branch office of such firms for which real estate
appraisals are performed by:

1. Two (2) or more state licensed or state certified real property
appraisers who are employed by or associated with the firm; or

2. Licensed appraiser trainees who are employed by or associated with the
firm and who assist a state licensed or state certified real property
appraiser in the performance of real estate appraisals.

B. The certified or licensed appraiser so designated shall be responsible
for:

1. The proper display of licenses and certificates of all state licensed
and state certified real property appraisers employed by or associated with
that office of the firm, and ascertaining whether each licensee or
certificate holder employed by or associated with the firm has complied
with Rule 2.02 of these Rules and Regulations;

2. The proper notification to the Council of any change of business address
or trade name of that office of the firm and the registration of any
assumed business name adopted by the firm for its use;

3. The proper conduct of advertising of appraisal services by or in the
name of the firm;

4. The property retention and maintenance of records relating to appraisals
conducted by or on behalf of the firm;

5. The maintenance of a record for each of the firm's state licensed
appraiser trainees that generally describes the nature and extent of
assistance rendered in connection with each appraisal; and

6. The maintenance of a record for each of the firm's state licensed and
state certified residential real property appraisers that generally
describes the nature and extent of assistance rendered by the state
licensed real property appraiser when assisting a state certified
residential or general real property appraiser and any assistance rendered
by the state certified residential real property appraiser when assisting a
state certified general real property appraiser in performing an appraisal.

C. No licensee or certificate holder shall be so designated for more than
one appraisal firm, combined real estate brokerage and appraisal firm, or
branch office of such firms.

D. Each certified or licensed appraiser so designated shall notify the
Council in writing of any change in his/her status of the certified or
licensed appraiser so designated within ten (10) days following the change.

E. Each certified or licensed appraiser so designated shall be located at
the office for which he/she is responsible for direct and personal
supervision thereof.

4.02 SUPERVISION OF STATE LICENSED APPRAISER TRAINEES

A. A state licensed appraiser trainee may assist in the completion of an
appraisal report, including an opinion of value, and may co-sign an
appraisal, provided that he/she is actively and personally supervised by a
state certified or licensed real property appraiser, provided that the
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appraisal report is reviewed and signed by the state certified or licensed
real property appraiser, and provided that the licensed or certified
appraiser accepts total responsibility for the appraisal report.

B. A state licensed or state certified real property appraiser may employ a
person(s) as a state licensed appraiser trainee(s) to assist in the
performance of real estate appraisals, provided that the state licensed or
state certified real property appraiser:

1. Actively and personally supervises the state licensed appraiser trainee;

2. Reviews all appraisal reports and supporting data used in connection
with appraisals in which the services of a state licensed appraiser trainee
is utilized;

3. Complies with all provisions of Rule 4.08 of this Section regarding
appraisal reports; and if applicable,

4. Prepares and furnishes to the certified or licensed appraiser designated
under Paragraph 4.01, and to each state licensed appraiser trainee whose
services were utilized in connection with the appraisal, a report on a form
prescribed by the Council describing the nature and extent of assistance
rendered by the state licensed appraiser trainee and places a copy of such
report in the supporting file for the appraisal.

C. All appraiser trainees must be licensed as required under Chapter 29,
Title 24, of the Delaware Code.

D. The holder of a real property appraiser trainee license issued pursuant
to 24 Del. C. Section 2934(d) and Rule 2.01(B) shall have the following
duties and responsibilities:

1. The trainee shall work under the direct supervision of a State licensed
or state ceritifed real property appraiser;

2. The trainee shall maintain an experience log on a form provided by the
Council;

3. The trainee shall inspect the property and participate in the appraisal
process in order to sign the report and to receive credit for the hours
spent. The report shall be signed by the trainee as follows:

Assisted by:

_____________________________, Trainee Name

License Number: ____________________

4. The trainee shall ensure that the log is available at all times for
inspection by the Council; and

5. When performing appraisal assignments, the trainee shall carry on
his/her person the license issued by the Council.

E. A supervising appraiser must be a State licensed or state certified real
property appraiser, and shall have the following duties and
responsibilities:

(1) The supervisor shall at all times be responsible for and provide direct
supervision of the work performed by the trainee in accordance with the
Uniform
Standards of Professional Appraisal Practice (USPAP). "Direct Supervision"
means to:

(a) personally inspect with the trainee the interior and exterior of each
property appraised;

(b) personally review each appraisal report prepared by the trainee;

(c) accept full responsibility for the report;

(d) assign work to the trainee only if the trainee is competent to perform
such work; and

(e) approve and sign the report as being independently and impartially
prepared and in compliance with USPAP, these rules and regulations, and
applicable statutory requirements.

(2) At least once a month, the supervisor shall sign the experience log
required to be kept by the trainee and shall affix his/her license or
certification number.

(3) The supervisor shall make available to the trainee a copy of any
appraisal report that the trainee signed that is requested for review by
the Council.

(4) After the trainee successfully completes seventy-five (75) hours of
education on real estate matters satisfactory to the Council, and has
obtained two hundred fifty (250) hours of residential appraising or one
thousand (1,000) hours of non-residential appraising experience as defined
by the Appraisal Qualifications Board in its appraisal qualifications
criteria, the supervisor and the trainee may jointly apply to the Council
on a form provided by the Council, for an exemption that would allow the
supervisor to sign the report without inspecting the property as provided
by Rule 4.02(B)(1)(a), provided the trainee is competent to perform the
inspection.

(5) The supervisor shall not supervise more than three (3) trainees whose
application for exemption has not been approved by the Council pursuant to
Rule 4.02(E)(1)(a).

(6) The supervisor must sign an affidavit affirming that he/she is a state
licensed or certified Real Property Appraiser and that he/she shall comply
with all rules and policies regarding supervisory appraisers.

(7) The supervisor shall comply with all provisions of Rule 3.06 regarding
appraisal reports.

F. Pursuant to Rule 2.03 a Real Property Appraiser Trainee's licenses may
be renewed only two (2) times.

G. When an appraiser trainee is discharged or terminates his/her employment
with a licensed or certified real estate appraiser by such licensed or
certified real estate appraiser shall immediately notify the Council in
writing of such termination. At the time of the written notification to the
Council, the licensed or certified appraiser shall address a communication
to the last known address of such appraiser trainee, which communication
shall advise the appraiser trainee that his/her employment has been
terminated. A copy of the communication to the appraiser trainee shall
accompany the notification to the
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Council. No such appraiser trainee shall perform any of the acts
contemplated by this Chapter or engage directly or indirectly in the
business of an appraiser trainee until the Council shall issue a new
license showing change of employment and business location.

4.03 SUPERVISION OF LICENSED OR CERTIFIED RESIDENTIAL APPRAISERS AND
TRAINEES

A. When a state licensed real property appraiser assists a state certified
residential or general real property appraiser in the performance of a real
estate appraisal and the resulting appraisal report is to be signed by the
state certified real property appraiser, the state certified real property
appraiser shall:

1. Actively and personally supervise the state licensed real property
appraiser;

2. Review the appraisal report and supporting data used in connection with
the appraisal;

3. Comply with all provisions of Rule 4.08 of this Section regarding
appraisal reports; and if applicable,

4. Prepare and furnish to the certified or licensed appraiser designated
under Paragraph 4.01, and to each state licensed real property appraiser
whose services were utilized in connection with the appraisal, a report on
a form prescribed by the Council describing the nature and extent of
assistance rendered by the state licensed real property appraiser and place
a copy of such report in the supporting file for the appraisal.

B. When a state certified residential real property appraiser assists a
state certified general real property appraiser in the performance of a
real estate appraisal and the resulting appraisal report is to be signed by
the state certified general real property appraiser, the state certified
general real property appraiser shall perform those supervisory acts set
forth in Subsection A of this Rule with regard to the activities of the
state certified residential real property appraiser.

4.04 USE OF TITLES

A. Licensure or certification as a real property appraiser is granted only
to persons and does not extend to a business entity.

B. A state licensed real property appraiser shall utilize the term "state
licensed real property appraiser"; a state certified residential real
property appraiser shall utilize the term "state certified residential real
property appraiser"; and a state certified general real property appraiser
shall utilize the term "state certified general real property appraiser"
when performing and signing appraisals. The terms "certified" or "licensed"
shall not be used in connection with appraisals or appraisers in any other
form. A state licensed appraiser trainee shall use the term "state licensed
appraiser trainee" and shall only co-sign appraisals along with a state
licensed or state certified
real property appraiser. Approved abbreviations are as follows:

DE Cert Gen followed by the certification number,

DE Cert Res followed by the certification number,

DE Lic Appr followed by the license number,

DE Appr Trainee followed by the license number.

4.05 DISPLAY OF LICENSES AND CERTIFICATES

A. The real property appraiser license or certificate of a state licensed
or state certified real property appraiser shall be prominently displayed
at the appraiser's place of business. Pursuant to Rule 4.01 the license or
certificate of the supervisory appraiser and the license or certificate of
each licensee or certificate holder engaged in real estate appraisal
activities at the office of the supervisory appraiser shall be prominently
displayed at such office.

B. The biennial license or certificate renewal pocket card issued by the
Council to each state licensed or state certified real property appraiser
shall be retained by the licensee or certificate holder as evidence of
licensure or certification.

4.06 ADVERTISING

A. When advertising or otherwise holding himself/herself out as a real
property appraiser, a state licensed real property appraiser shall identify
himself/herself as a "state licensed real property appraiser." A state
certified residential real property appraiser shall identify
himself/herself as a "state certified residential real property appraiser".
A state certified general real property appraiser shall identify
himself/herself as a "state certified general real property appraiser."

B. A state licensed or state certified real property appraiser doing
business as a partnership, association, corporation, or other business
entity shall not represent in any manner to the public that the
partnership, association, corporation, or other business entity is either
licensed or certified by the State of Delaware to engage in the business of
real estate appraising.

4.07 CHANGE OF NAME OR ADDRESS

All licensees and certificate holders shall notify the Council in writing
of each change of business address, residence address, or trade name within
ten (10) days of said change. The address shall be sufficiently descriptive
to enable the Council to correspond with and locate the licensee or
certificate holder.

4.08 APPRAISAL REPORTS

A. Each written appraisal report prepared by or under the direction of a
state licensed or state certified real property appraiser shall bear the
signature of the state licensed or state certified appraiser, the license
or
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certificate number of the licensee or certificate holder in whose name the
appraisal report is issued, and the designation "state licensed appraiser
trainee" (as co-signer only), "state licensed real property appraiser,"
"state certified residential real property appraiser," or the designation
"state certified general real property appraiser," or the approved
abbreviations as specified in Section 4.01. Where applicable, each
appraisal report shall also indicate whether or not the state licensed or
state certified appraiser has personally inspected the property, and shall
identify any other person who assists in the appraisal process other than
by providing clerical assistance.

B. When a state licensed or certified real property appraiser signs an
appraisal report prepared by another person, including a subcontractor
acting under the direction or supervision of the appraiser, such appraiser
shall be fully responsible for the content of the report.

SECTION 5 - TEMPORARY PRACTICE & RECIPROCITY

5.01 TEMPORARY PRACTICE

The Council may grant temporary licensing or certification privileges in
accordance with 24 Delaware Code, Section 2935 (a).

5.02 RECIPROCITY

The Council may grant a reciprocal license in accordance with 24 Delaware
Code Section 2935 (b) to applicants certified or licensed in another state
whose requirements for certification or licensure are substantially
equivalent to the State of Delaware without being registered with and duly
licensed or certified by the Council on Real Estate Appraisers.

SECTION 6 - GUIDELINES FOR QUALIFYING MASS APPRAISAL EXPERIENCE

6.01 QUALIFYING MASS APPRAISAL EXPERIENCE

The Delaware Council on Real Estate Appraisers ("Council") has developed an
application for ad valorem tax assessors to apply mass appraisal experience
toward licensure or certification. The application is different from the
application for independent fee appraisers, and, therefore, the Council has
prepared this document as supplemental explanation of the mass appraisal
experience guidelines set forth in the Tax Assessor's Application for Real
Estate Appraiser License or Certificate. The State of Delaware under
Chapter 24, Subchapter II. Regulation of Real Estate Appraisers, Subsection
2932, subparagraph (c), sets forth specifically:

"(c) The Council on Real Estate Appraisers is required to include in its
regulations educational
experience and testing requirements for licensure and certification of real
estate appraisers that ensure protection of the public interest.
Educational experience and testing requirements for certified and licensed
appraisers must specifically meet the criteria established under Title XI
of the Financial Institutions Reform Recovery Act of 1989, public Law
101-73 [12 U.S.C. & 1833 a et seq.], and any subsequent amendments thereto
or any regulations promulgated thereunder. (67 Del Laws, C. 381 ss1; 68
Del. Laws, c. 140, ss 5-7, 15.)"

Further, The Appraiser Qualifications Board of the Appraisal Foundation has
issued as additional explanation "Interpretations/Clarifications" to
accompany the qualifying criteria for appraiser licensure and
certification, which specifically sets forth:

"Experience credit should be awarded to ad valorem appraisers who
demonstrate that they (1) use techniques similar to those used by
appraisers to value properties and (2) effectively use the appraisal
process.

Components of the mass appraisal process that should be given credit are
highest and best use analysis, model specification (developing the model),
and model calibration (developing adjustments to the model). Other
components of the mass appraisal process, by themselves, shall not be
eligible for experience credit.

Mass appraisals shall be performed in accordance with USPAP Standard 6." In
order to evaluate the experience qualifications of ad valorem tax assessors
with mass appraisal experience, the Council will review such applications
considering the above - mentioned criteria, and shall review work samples
for compliance with USPAP Standard 6. It is important to note that any
individual appraisal reports prepared in conformity with USPAP Standards 1
and 2 are fully creditable as appraisal experience using the hourly scheme
set forth in the category for Full Appraisals in the Real Property Tax
Assessor's Application for Real Estate Appraiser License or Certificate.
Such reports are often prepared by ad valorem appraisers for defense of
value work. Ad valorem appraisers are encouraged to apply for experience
credit for full appraisals as well as for mass appraisal experience. An
hour of experience is defined as actual verifiable time spent performing
tasks in accordance with the Council Rules and Regulations. USPAP Standard
6 sets forth in detail the required work and the reporting of that work for
ad valorem tax purposes. Unlike the fee appraiser who prepares and signs a
report for each value estimate, the ad valorem appraiser typically prepares
analyses and reports that support the appraisals for groups of properties.
These efforts are focused on the specification and calibration of models
(validation schedules) for these groups of properties.

Mass appraisal experience hours are awarded for completing appraisals
pursuant to the USPAP Standard 6.
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Currently, a minimum of 2,000 hours over a two (2) - year period is
required for all applicants for licensure or certification. A minimum of
1,000 hours must be obtained in non-residential valuation if applying for
the General Certification. The State of Delaware has the same qualification
criteria as published by the Appraiser Qualifications Board of the
Appraisal Foundation.

As stated in the Real Property Tax Assessor's Application for Real Estate
Appraiser License or Certificate, applicants seeking mass appraisal
experience credit must demonstrate their experience using one of the
following options:

A. Develop the mass appraisal system (model specification and calibration
that includes highest and best use analysis) or;

B. Adjust an existing mass appraisal system to local market conditions
(model calibration that includes highest and best use analysis).

1. Data collection for purposes of mass appraisal, defined as the on-site
collection of property characteristics, is not by itself creditable as
appraisal experience. However, as part of mass appraisal model
specification and/or calibration, the applicant accepts responsibility for
the accuracy of market (sales) data used to develop and/or calibrate the
models. Therefore, it is important that the applicant have a working
familiarity with the range of properties in the sales sample and thus
creditable experience is allowed for sales verification work in conjunction
with the mass appraisal model specification/calibration process.

2. The applicant must have a documented data collection manual that
specifies how each property characteristic was measured. For each property
characteristic that influences the final value for any property, a complete
specification of the variable must be available in the mass appraisal model
(schedule) documentation. This documentation must detail how each property
characteristic influences value and it must provide a basis in terms of
market evidence for using these characteristics.

3. If the applicant is using an existing mass appraisal system, either mass
appraisal vendor supplied or a commercial cost service, documentation must
exist which supports how the valuation system was calibrated to local
market conditions. If the cost approach is used, documentation must exist
which illustrates the extraction of depreciation schedules from local
market analysis.

4. If the applicant develops the mass appraisal model (schedule)
specification, evidence derived directly from the local market must be
available that supports the use of each property characteristic. For
property characteristics included in the model that have a marginal
influence on value (items generally included for public relations
purposes), such items should be specifically
identified and their contribution to value detailed.

6.02 MASS APPRAISAL EXPERIENCE LOG

Applicants seeking mass appraisal experience credit must complete the
attached Mass Appraisal Experience Log. Use the key on the Mass Appraisal
Experience Log form for creditable experience. The information included in
each column is as follows:

Date of Activity State the specific dates of the activity. If a range of
dates is appropriate, be sure that the activity occurred continuously over
that period. (Example: March 23-24, 1992)

Value Date Applicants applying for ad valorem, mass appraisal experience
completed in Delaware must list the month and year of the valuation date.

Property Class Use the key on the form for identifying the property type.

1. Residential (less than 5 units)

2. Multi - Family (2 - 4 units)

3. Commercial

4. Industrial

5. Special purpose properties

City/Town Municipality where the mass appraisal work was used to generate
appraisals.

Type of Activity Use the key on the form for identifying the property type.
The creditable types of activity are listed as follows:

A. Highest and Best Use Analysis - Detail analysis used to determine
highest and best use of a site both as if vacant and as developed.

B. Model Specification - Development of the valuation schedules. Such
documentation should include the approach to value (cost, market or
income), identification of how factors (property characteristics) were
selected, the quantification of these factors (dollar or percentage
adjustments) and how the relationship among the factors was determined.

C. Model Calibration - Adjusting the valuation schedules using the
generally accepted techniques, such documentation should include any
statistical analyses employed to set unit prices and percentage
adjustments.
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Hours Only the actual working hours on the associated activity are
creditable. Only time specifically spent on the activity is creditable.
Working full-time on a revaluation project does not automatically translate
into 40 hours per week of creditable appraisal experience. The applicant
must be precise in detailing the activities and when they took place. In
evaluating the number of hours of credit requested, any unusual number of
hours claimed for a particular activity may result in further review of the
supporting documentation. NOTE THAT DATA COLLECTION AND FIELD REVIEW
ACTIVITIES BY THEMSELVES ARE NOT CREDITABLE EXPERIENCE.

Position Title List your position at the time of activity.

Documentation State the physical location of the

Locations documentation which details each activity for which experience
credit is requested. It is advisable to secure copies of any documentation
not in your possession prior to applying for experience credit. THE
APPLICANT IS RESPONSIBLE FOR THE PRODUCTION OF THIS DOCUMENTATION.
Therefore, it is important that the applicant claim credit only for the
activities for which documentation can be immediately produced.

Upon request the applicant may be asked to submit sworn statements from
witnesses who can verify his/her claimed experience.

SECTION 7 - STANDARDS OF APPRAISAL PRACTICE

7.01 APPRAISAL STANDARDS

A. In performing the acts and services of a state licensed or state
certified real property appraiser, every appraiser trainee, state licensed
and state certified real property appraiser shall comply with those
appraisal practice standards known as the "Uniform Standards of
Professional Appraisal Practice" and any subsequent amendments thereto,
promulgated by the Appraisal Standards Board of the Appraisal Foundation or
it successor organization, which standards are hereby adopted by reference.

B. Copies of the "Uniform Standards of Professional
Appraisal Practice" are available upon request to The Appraisal Foundation,
1029 Vermont Avenue, N.W., Suite 900 Washington, D.C. 20005-3517 and are
made available by the Council from time-to-time.

SECTION 8 - COMPLAINTS; HEARING PROCEDURES; FINAL DECISIONS

8.01 COMPLAINTS

The Council incorporates by reference the procedures for investigation of
complaints by the Division of Professional Regulation as set forth in
Section 8810 of Title 29 of the Delaware Code.

8.02 HEARING PROCEDURES

All hearings shall be in accordance with the Administrative Procedures Act,
29 Del. C. Sections 10121-10129.

A. At least 30 days before the date fixed for the hearing, the Council
shall cause a copy of the complaint, together with a notice of the time and
place fixed for the hearing, to be personally delivered or served upon the
accused real estate appraiser. In cases where the accused real estate
appraiser cannot be located or where personal service cannot be effected,
substitute service shall be effected in the same manner as with civil
litigation. The accused real estate appraiser shall also be advised of
his/her rights, as follows:

1. That he/she has the right to appear personally and to be represented by
counsel;

2. That he/she has the right to cross-examine any witness who may appear
against him/her and produce witnesses and evidence in his/her own defense;
and

3. That he/she is entitled to the subpoena power of the Council to ensure
the attendance of any witnesses he or she intends to call. If the accused
wishes to avail himself/herself of the Council's subpoena power, he/she
must submit to the Council, in writing and no later than fifteen (15) days
prior to the date of the hearing, the names and addresses of the witnesses
whose attendance he/she wishes the Council to compel.

B. All hearings shall be informal and shall not be bound by the formal
rules of evidence. All testimony shall be taken under oath. All testimony
which the Council

determines to be relevant, reliable, and probative and not unduly
repetitious, shall be admissible. Objections to the admission or exclusion
of evidence shall be brief and shall state the grounds for objection. Any
offer of proof which is made in connection with the objection to the
admission of evidence shall consist of a statement of that which the
offeror contends would be abused by such evidence. Where the offered
evidence concerns a document, a copy of the same shall be marked for
identification.

C. All testimony shall be recorded either by a court
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reporter or by means of an electronic recording device. In the event
electronic means are used, the electronic record shall be preserved until
after the time for appeal of the Council's decision has expired with no
appeal being taken. The Council shall maintain a permanent written record
of all hearings in the form of official minutes.

D. Hearings shall be conducted in the following manner:

1. The Council shall open the hearing with a brief statement of the purpose
of the hearing.

2. The Council shall then receive the evidence which is offered to support
the charges which have been proffered against the accused real estate
appraiser.

3. The accused real estate appraiser shall be afforded an opportunity to
cross-examine any witness who may testify against him/her.

4. After all of the evidence which supports the charges has been received,
the accused real estate appraiser may present a brief statement of that
which he/she intends to establish.

5. The accused real estate appraiser may then testify in his/her own behalf
and present witnesses and evidence in his/her defense.

6. All witnesses who appear before the Council shall be subject to
examination by the Council.

8.03 TRANSCRIPTS

Transcripts of the proceedings my be obtained by the accused real estate
appraiser or any other person interested in the hearing upon written
request and payment of the costs involved in preparing the same.

8.04 RETURN OF DOCUMENTARY EVIDENCE

Any documentary evidence which is submitted to the Council shall be
returned to the owner thereof upon written request for the return of such
documents within 120 days of

the Council's final decision. Otherwise, the Council may dispose of such
evidence at its discretion.

8.05 FINAL DECISION

A. If, on the basis of the evidence presented at the hearing, the Council
finds, by a majority vote of all members, that the complaint has merit, the
Council shall take such action permitted under Subchapter II, Chapter 29 of
Title 24 as it deems necessary. The Council's decision shall be in writing
and shall include:

1. A brief statement of the evidence presented,

2. The Council's findings of fact,

3. What record evidence these findings are based upon, and

4. The Council's conclusions of law.

B. A copy of the Council's decision shall be mailed immediately by
certified mail, return receipt requested, to
the accused real estate appraiser. The Council's decision shall become
effective on the 30th day after the date it is mailed or served on the
accused real estate appraiser, unless there is a stay pending appeal by the
accused real estate appraiser ordered by the Superior Court.

SECTION 9 - PUBLIC DISCLOSURE

9.01 PUBLIC NOTICE

Public notice of all meetings shall be given seven (7) days prior to all
meetings.

A. The notice will be posted at the Division of Professional Regulation
Office in Dover, Delaware, according to the Freedom of Information Act.

B. Said notice shall include the agenda, as well as the date, time, and
location of each meeting.

9.02 MEETING MINUTES

Minutes shall be kept of all meetings in accordance with the Freedom of
Information Act.

A. Said minutes shall include a record of those present.

B. The minutes shall also include a record by individual members, on each
vote taken, as well as any action agreed upon.

C. It shall be the responsibility of the Council's Administrative Assistant
to prepare said minutes and keep a copy on file with the Division of
Professional Regulation.

9.03 COUNCIL RECORDS

It shall be the responsibility of the Council's Administrative Assistant to
safeguard the Council's records and to make then accessible to the general
public.

A. No citizen of the State of Delaware shall be denied reasonable access to
the public records of the Council. Copies of records may be obtained from
the Administrative Assistant at a cost per page as established by the
Division.

B. The Council shall not be obligated to disclose to the general public any
matter which intrudes upon an individual's personal or private affairs
which is not a public record in which the public has not legitimate
interest. Records will be open to the public in reference to the Freedom of
Information Act.

SECTION 10 - CHANGE AND MODIFICATION TO RULES AND REGULATIONS

10.01 CHANGES/MODIFICATIONS

The Council may, change or modify these Rules and Regulations as dictated
by the evolution of appraisal practice after providing for the Public
Notice/Hearing as required, if any.
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SECTION 11 - SEVERABILITY

11.01 SEVERABILITY

If any part of these rules and regulations is held invalid,
unconstitutional or otherwise contrary to law, then it shall be severable
and the remaining portions hereof shall remain and continue in full force
and effect.
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Symbol Key

Roman type indicates the text existing prior to the regulation being
promulgated. Underlined text indicates new text added at the time of the
proposed action. Language which is striken through indicates text being
deleted. [Bracketed Bold language] indicates text added at the time the
final order was issued. [Bracketed striken through ] indicates language
deleted at the time the final order was issued.

Final Regulations

The opportunity for public comment shall be held open for a minimum of 30
days after the proposal is published in the Register of Regulations. At the
conclusion of all hearings and after receipt within the time allowed of all
written materials, upon all the testimonial and written evidence and
information submitted, together with summaries of the evidence and
information by subordinates, the agency shall determine whether a
regulation should be adopted, amended or repealed and shall issue its
conclusion in an order which shall include: (1) A brief summary of the
evidence and information submitted; (2) A brief summary of its findings of
fact with respect to the evidence and information, except where a rule of
procedure is being adopted or amended; (3) A decision to adopt, amend or
repeal a regulation or to take no action and the decision shall be
supported by its findings on the evidence and information received; (4) The
exact text and citation of such regulation adopted, amended or repealed;
(5) The effective date of the order; (6) Any other findings or conclusions
required by the law under which the agency has authority to act; and (7)
The signature of at least a quorum of the agency members.

The effective date of an order which adopts, amends or repeals a regulation
shall be not less than 10 days from the date the order adopting, amending
or repealing a regulation has been published in its final form in the
Register of Regulations, unless such adoption, amendment or repeal
qualifies as an emergency under §10119.
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Department of Finance

Division of Revenue

Thoroughbred Racing Commission

Statutory Authority: 3 Delaware Code

Sections 10103 & 10128(m)(1)

(3 Del.C. 10103, 10128(m)(1)

BEFORE THE DELAWARE THOROUGHBRED RACING COMMISSION

IN RE: PROPOSED RULES AND REGULATIONS

ORDER

Pursuant to 29 Del. C. section 10118, the Delaware Thoroughbred Racing
Commission ("Commission") hereby issues this Order promulgating the
proposed amendment of Rule 15.02 of the Commission's Rules. Following
notice and a request for written submissions:

SUMMARY OF EVIDENCE AND INFORMATION SUBMITTED

1. The Commission posted public notice of the proposed deletion to Rule
15.02(e) in the Register of Regulations and in the News-Journal and
Delaware State News.
The Commission received no written comments from the public concerning the
proposed regulation.

FINDINGS OF FACT

2. The public was given notice and an opportunity to provide the Commission
with comments in Writing on the proposed amendment to Rule 15.02(e). The
Commission received no written comments on the proposed repeal of the rule.

3. The Commission finds that the proposed repeal of Rule 15.02(e) would
permit two-year old horses to be eligible for the bleeder program. The
Commission finds that the proposed rule is necessary to comply with the
statutory authority of the Commission under 3 Del. C. section 10103 to
regulate the conduct of participants in thoroughbred racing and for the
effective enforcement of 3 Del. C. Chapter 101.

4. The Commission finds that Rule 15.02(e) should be repealed as proposed.
The repeal of this rule will allow for two-year old horses to participate
in the bleeder program. This is a practice which is consistent with the
rules in other states and does appear to be in the best interests of the
public and the sport of thoroughbred racing.
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CONCLUSIONS

5. The proposed Rule 15.02(e) was promulgated by the Commission in accord
with its statutory duties and authority as set forth in 3 Del. C. section
10103.

6. The Commission deems this rule repeal necessary for the effective
enforcement of 3 Del. C. Chapter 101 and for the full and efficient
performance of its duties thereunder.

7. The Commission concludes that the repeal of Rule 15.02(e) would be in
the best interests of the citizens of the State of Delaware and necessary
to insure the integrity and security of the conduct of thoroughbred racing
in the State of Delaware.

8. The Commission, therefore, repeals Rule 15.02(e) as revised and amended
pursuant to 3 Del. C. section 10103 and 29 Del. C. section 10103.

9. This existing Rule 15.02(e) shall be repealed in its entirety.

10. The effective date of this Order shall be ten (10) days from the date
of publication of this Order in the Register of Regulations on February 1,
1998.

(Signed) Bernard Daney, Chairman

(Signed) Duncan Patterson, Commissioner

(Signed) Deborah Killeen, Commissioner

(Unsigned) Deborah Berry, Commissioner

The Commission proposes the repeal of Rule 15.02(e) pursuant to 3 Del. C.
sections 10103 and 10128(m)(1), and 29 Del. C. section 10115. The proposed
repeal of Rule 15.02(e) would allow for two year old horses to participate
in the bleeder program. The proposed Rule will be considered by the
Commission at its next regularly scheduled meeting on January 5, 1997 at
11:00 a.m. at the Delaware State Lottery Office, 1575 McKee Road, Suite
102, Dover, DE 19904-1903. Copies of the proposed rule may be obtained from
the Commission. Comments may be submitted in writing to the Commission
Office on or before 4:00 p.m. on December 30, 1998. The Commission Office
is located at 2320 South DuPont Highway, Dover, DE 19901 and the phone
number is (302) 739-4811.

15.02 Bleeder Medication:

Notwithstanding anything in the Rules of Racing to the contrary, the
Stewards may permit the administration of Furosemide (Lasix) to control
epistaxis (bleeding) to horses under the following conditions.

(a) A horse which, during a race or workout at a duly licensed race track
in this State or within the first hour immediately following such a race or
workout, is observed by the Licensee's Veterinarian or the Stewards to be
shedding blood from one or both nostrils or is found to have bled
internally. (An endoscopic examination of the
horse, in order to confirm bleeding, may be performed by the practicing
veterinarian in the presence of the Licensee's Veterinarian at the
detention barn within one (1) hour of workout or race.)

(b) A horse which has been certified as a bleeder in another jurisdiction
may be placed on the bleeder list provided that the other jurisdiction
qualified it as a bleeder using criteria satisfactory to the Licensee's
Veterinarian and the Stewards. It shall be the absolute responsibility of
the Trainer to report bleeders from other jurisdictions to the Licensee's
Veterinarian or Stewards on official forms from that State prior to entry.

(c) The Licensee's Veterinarian shall be responsible to maintain an
up-to-date "bleeder" list and the list shall be available in the Racing
Secretary's office.

(d) A horse in the Bleeder Program shall be required to be brought to a
detention barn designated by the Licensee and approved by the Commission
not later than three and one-half (3 1/2) hours before post time for the
race in which it is entered and shall remain in said detention barn (in its
assigned stall) until called to the paddock prior to post time. During the
3 1/2 hour period, the horse shall be under the care and custody of a groom
or caretaker appointed by the Trainer. The approved Furosemide medication
may be administered by a licensed practicing veterinarian in the detention
barn within three (3) hours before post time. The practicing veterinarian
shall make a report to the Stewards of the treatment on forms provided by
the Stewards on the same day of treatment.

(e) No 2-year-old horse will be acceptable for the Bleeder Program.

(f) A horse which bled for the first time shall not be permitted to run for
a period of ten (10) calendar days. A horse which bleeds a second time
shall not be permitted to run for sixty (60) calendar days. A horse which
bleeds a third time will be barred from further racing in the State of
Delaware. A positive endoscopic examination shall be classed as a first
time bleeder.

REVISED: 6/19/92

Department of Education

Statutory Authority: 14 Delaware Code,

Section 122 (14 Del.C. 122)

BEFORE THE DEPARTMENT OF EDUCATION OF THE STATE OF DELAWARE
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REGULATORY IMPLEMENTING ORDER

THE DELAWARE ADMINISTRATOR STANDARDS

I. SUMMARY OF THE EVIDENCE AND INFORMATION SUBMITTED

The Delaware Administrator Standards are recommended for adoption as
regulation. The Standards are the result of the work of a committee of
twenty-one educators representing building administrators, central office
administrators, Department of Education staff, teachers, school boards and
higher education. The committee convened on January 13, 1997 to begin the
task of articulating the standards. The work of the committee was made
easier by the fact that an ad hoc committee made up of representatives of
various professional groups had been working on the same task, albeit for a
different purpose, for the past several years. In addition, the committee
was fortunate to have a national leader in the development of administrator
standards, Scott Thomson, recently retired Executive Director of the
National Policy Board for Educational Administration, as their consultant.

The Administrator Standards are a clear and defining statement of what all
school administrators should know and be able to do regardless of specific
job responsibilities. These standards apply to all educational
administrators requiring state licensure to practice. Key to building a
cadre of school administrators possessing these attributes is an
expectation that the profession of educational leadership will possess the
characteristics of all other major professions. These characteristics
include a common core of knowledge together with demonstrated performance,
ethical standards and accountability to the public.

These Delaware Administrator Standards reflect a solid compatibility with
the two national documents, Standards for School Leaders prepared by the
Interstate School Leaders Licensure Consortium (ISLLC) and Curriculum
Guidelines for Advanced Programs in Educational Leadership approved by the
National Council for the Accreditation of Teacher Education (NCATE). There
is also a high level of compatibility with the Delaware Teaching Standards.
The standards address Systemic Leadership, Instructional Leadership,
Community and Political Leadership, Organizational Leadership and
Interpersonal and Ethical Leadership.

The Delaware Administrator Standards Regulations include the five Standards
with Knowledge and Performance Indicators for each Standards.

Notice of the proposed regulations was published in the News Journal and
the Delaware State News on December 15, 1997, in the form attached as
Exhibit A. There were no comments received concerning the regulations from
the
advertisement in the newspapers. However, there were some comments received
through public forums. Three public forums were held, one in each county,
with a total of 23 participants and ten districts represented. The major
question expressed at each forum was how administrators will be assessed
and held accountable for the Administrator Standards. Administrators in
non-instructional positions wanted an assurance that they would be treated
fairly in the new evaluation system, since many of the indicators are
focused on instructional leadership.

II. FINDINGS OF FACT

The Secretary and the State Board of Education find that these regulations
are necessary in order to further the intent of the accountability plan.
These Administrator Standards along with the Teaching Standards are the
next logical steps in standard setting following

the student Content Standards. These five standards are performance based
and describe what administrators should know and be able to do regardless
of specific job responsibilities. The key to building a cadre of school
administrators possessing these attributes is an expectation that the
profession of educational leadership will possess characteristics which
include a common core of knowledge together with demonstrated performance,
ethical standards and accountability to the public. These Administrator
Standards will be the basis for State licensure, professional development
and recertification, performance appraisal and accreditation of university
programs which prepare educational administrators.

III. DECISION TO ADOPT REGULATIONS

For the foregoing reasons, the Secretary and the State Board of Education
conclude that the proposed regulations are necessary to continue the
standards based accountability plan. Therefore, pursuant to 14 Del. C.,
Section 122 the regulations attached hereto as Exhibit B are hereby
adopted. Pursuant to the provisions of 14 Del. C., Section 122(e), the
amendment hereby adopted shall be in effect for a period of five years from
the effective date of this order as set forth in Section V. below.

IV. TEXT AND CITATION

The text of the regulations adopted hereby shall be in the form attached
hereto as Exhibit B, and said regulations shall be cited in the Manual for
the Certification of Professional School Personnel, in a new section 3
titled Professional Standards.

V. EFFECTIVE DATE OF ORDER

The actions herein above referred to were taken by the Secretary pursuant
to 14 Del. C., Section 122 in open session at the State Board's regularly
scheduled meeting on January 15, 1998. The effective date of this Order
shall be
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ten days from the date this order is published in the Delaware Register of
Regulations.

IT IS SO ORDERED this 15th day of January, 1998.

Dr. Iris T. Metts

Secretary of Education

Consented to this 15th day of January, 1998.

STATE BOARD OF EDUCATION

Dr. James L. Spartz, President

Jean W. Allen, Vice President

Nancy A. Doorey

John W. Jardine, Jr.

Dr. Joseph A. Pika

Dennis J. Savage

Dr. Claibourne D. Smith

Delaware Administrator Standards

1. Systemic Leadership: An educational leader

possesses the knowledge and skills to foster vision and purpose, to achieve
common goals, to frame problems, to utilize information, to exercise
leadership processes, and to promote teamwork to achieve the vision.

Knowledge

The educational leader has knowledge and understanding of:

• purposes of education.

• strategic planning and vision building.

• learning communities.

• organizational change processes.

• consensus building and negotiating.

• leadership and motivation.

• problem framing and problem resolution.

• data collection, analysis, and interpretation.

• social and political influences affecting schools.

Performance

The educational leader prepares for and acts to:

• create a shared vision of learning that promotes high levels of success
for all students.

• develop a school community focusing on teaching and learning.

• facilitate collegiality and teamwork by creating conditions that motivate
staff, students, and families to achieve the shared vision.

• utilize the change process to improve the organization.

• frame, analyze, and resolve issues using problem-solving techniques and
decision-making skills.

• gather, analyze, and utilize data for strategic planning and
decision-making using appropriate technologies.

• communicate the vision and core beliefs of the school to the school
community.

• recognize potential opportunities and barriers to achieving the school
community's vision, and initiate strategies to address them.

• monitor and revise the vision and mission regularly with the school
community.

2. Instructional Leadership: An educational leader possesses the knowledge
and skills to facilitate the design of appropriate standards-based
curriculum, to develop a positive learning environment, to initiate with
faculty a variety of instructional programs, to assess outcomes, and to
plan professional development activities with staff.

Knowledge

The educational leader has knowledge and understanding of:

• student growth and development.

• applied learning theories.

• curriculum design, implementation, evaluation and refinement.

• instructional principles and strategies.

• instructional technologies.

• special needs of diverse student populations.

• supervision and performance appraisal strategies.

• measurement theory and assessment related issues.

• adult learning and professional development strategies.

• Delaware content standards.

Performance

The educational leader prepares for and acts to:

• model a strong commitment to teaching and learning.

• collaborate with staff to plan and implement curriculum based on student
needs, research, informed practice, governmental policies, and the
recommendations of national groups.
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• develop collaboratively a learning organization that focuses on improving
instruction, incorporates best practice, and promotes student achievement.

• incorporate various staffing patterns, student grouping plans, scheduling
patterns, and organizational structures to support teaching strategies
appropriate to desired student outcomes.

• facilitate with teachers the selection of learning materials and
experiences appropriate for various learning styles and specific student
needs.

• promote learning responsive to gender, ethnicity, culture, socio-economic
needs, and exceptionalities.

• support instruction that develops thinking skills, promotes problem
solving, and applies learning.

• assure a variety of assessment strategies to measure desired student
outcomes.

• collect and analyze student data to improve curriculum and instruction.

• incorporate technologies into the instructional system.

• integrate co-curricular and extra-curricular activities with the
instructional program.

• facilitate the development of professional growth programs which promote
continuous improvement.

• utilize supervisory and performance appraisal techniques consistent with
state policy.

3. Community and Political Leadership: An educational leader possesses the
knowledge and skills to act in accordance with legal provisions and
statutory requirements, to influence public policy, to apply regulatory
standards, to understand schools as political systems, to inform and
involve parents and community groups, and to develop public relations and
media relations programs.

Knowledge

The educational leader has knowledge and understanding of:

• federal and state constitutional, statutory and regulatory provisions,
and judicial decisions governing education.

• common law and contractual requirements.

• political, social, cultural and economic issues and forces affecting
education.

• policy formulation, implementation and evaluation at the federal, state
and local levels.

• public school governance and school board functions.

• family and community involvement in appropriate policy development,
program planning and assessment procedures.

• conditions and dynamics of the diverse school community.

• school communities as political systems.

• public and media relations.

Performance

The educational leader prepares for and acts to:

• apply federal and state constitutional, statutory and regulatory
provisions, judicial decisions, common law requirements, and contractual
agreements to schools and school personnel.

• propose and influence policies that benefit students and schools.

• interact with the diverse school community to benefit students.

• develop relationships with families to strengthen educational commitment
and opportunity.

• identify and influence key opinion leaders and organizations to generate
support for school goals and programs.

• assure that ethical standards be applied to the development and
implementation of policies.

• involve the school community, as appropriate, in planning and assessing
school policies and programs.

• articulate the district and school educational vision and program
initiatives.

• develop partnerships with public and private organizations to improve
educational opportunities for all students.

• work with local governing boards.

• implement staff communications and public relations strategies for the
benefit of students and schools.

• communicate with parents, the community, and school personnel, utilizing
available technologies.

4. Organizational Leadership: An educational leader possesses the knowledge
and skills to establish and improve organizational structure and processes,
to design and implement operational plans, to secure and manage
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resources, and to engage others in the decision making process.

Knowledge

The educational leader has knowledge and understanding of:

• organizational and management systems and technologies.

• operational procedures.

• budget planning and management processes.

• management techniques.

• facilities and support services management.

Performance

The educational leader prepares for and acts to:

• establish operational plans and procedures to accomplish goals.

• implement management processes and procedures which recognize the value
of decentralized and centralized decisions.

• use collaborative processes to develop procedures and make decisions.

• prioritize individual and organizational time to accomplish educational
goals.

• review organizational structures and management systems regularly.

• develop a budget planning process which reflects school and district
priorities.

• perform budget management and reporting functions.

• apply technologies to management operations.

• utilize the change process for improving organizational structure and
management.

• create a safe school environment.

• manage collective bargaining agreements.

• manage capital goods and support services.

5. Interpersonal and Ethical Leadership: An educational leader possesses
the knowledge and interpesonal skills to facilitate teamwork and
collegiality and the attributes to act ethically and with integrity.

Knowledge

The educational leader has knowledge and understanding of:

• professional codes of ethics.

• ethical frameworks and perspectives.

• communication processes and skills.

• consensus-building and negotiating strategies.

• interpersonal processes.

• conflict management.

• counseling and mentoring.

• values of the diverse school community.

• leadership by example.

Performance

The educational leader prepares for and acts to:

• demonstrate by example a high standard of professional and personal
ethics.

• make decisions within an ethical framework.

• develop an organizational ethos to guide school policies and programs,
and to encourage a positive school culture.

• create a culture of trust and open communication.

• exhibit sensitivity, respect, tact, and consistency in interpersonal
relations.

• use effective written, verbal and non-verbal communication.

• foster continuous professional growth.

• develop leadership opportunities for staff.

• utilize the knowledge, skills, and experiences of the diverse school
community.

• resolve conflicts and tensions.

• promote awareness of and sensitivity to ethnicity, gender, culture, and
exceptionalities.

• utilize counseling and mentoring techniques.

• examine and consider the prevailing values of the community.

• promote integrity and ethical behavior of others within the school
community.

• celebrate student and staff accomplishments.

Department of Education

Statutory Authority: 14 Delaware Code,

Section 122 (14 Del.C. 122)

BEFORE THE DEPARTMENT OF EDUCATION OF THE STATE OF DELAWARE

REGULATORY IMPLEMENTING ORDER

THE DELAWARE TEACHING STANDARDS

I. SUMMARY OF THE EVIDENCE AND INFORMATION
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SUBMITTED

The Delaware Teaching Standards are recommended for adoption as regulation.
The Standards are a result of the work of a special Task Force for
Professional Teaching Standards comprised of forty one teachers,
administrators, teacher educators and representatives of the public. These
Standards are composed of a set of performance based standards describing
what teachers should know and be able to do, regardless of specialty area.
These Teaching Standards are part of the Delaware Professional Standards
Council's Educational Plan for Certification and Career Development and
reflect the new content standards for Delaware's students as well as to the
standards for "accomplished teachers" which are the basis for certification
by the National Board for Professional Teaching Standards. The Standards
have had an extensive review process by both external experts and educators
within the state. All educators in the state were sent a copy of the
standards and asked to send their written responses to a questionnaire to
the University of Delaware for analysis. Modifications were made to the
standards based on the feedback from the questionnaire.

The Delaware Teaching Standards will be used in designing and evaluating
teacher education programs, inducting, mentoring and assessing teachers and
in organizing in-service and professional development activities. In other
words the Teaching Standards will be the foundation for every segment of
the professional careers of Delaware teachers, from pre-service through
beginning practice and continuing professional growth. In practice these
are not generic, one size fits all teaching behaviors. In order to meet the
standards, a teacher must exhibit them in the context of his or her actual
teaching responsibilities and at a proficiency appropriate to his or her
career stage.

The Delaware Teaching Standards Regulations include the twelve Standards
Statements, with Knowledge Components and Performance Indicators for each
Standard and a Glossary of thirty definitions.

Notice of the proposed regulations was published in the News Journal and
the Delaware State News on December 15, 1997, in the form attached as
Exhibit A. There were no comments received concerning the regulations from
the advertisement in the newspapers. However, there were some comments
received through public forums. Three public forums were held, one in each
county, with a total of 29 participants. New Castle County had both the
largest attendance and the most dialog regarding the Standards. The major
concern focused on the Technology Standard and the fact that sufficient
professional development and hardware/software will be required in order to
meet the Standard. Both of those factors are out of the teachers'
sphere of control and consequently worrisome. There was concern regarding a
requirement within the standards which hold the teacher accountable for
working closely with parents/guardians. Again the issue was that teachers
can't "control" parent behavior and it is a fact that some
parents/guardians simply refuse to cooperate or be involved in their
child's education. Most of the other discussion was focused on areas of
accountability rather than the Standards themselves. The consistent concern
is "How will the Standards be used?", particularly with respect to the
teacher evaluation system.

No additional issues surfaced in Kent and Sussex Counties. As in New Castle
County, accountability was the pressing issue. One parent at the Sussex
Forum did state that he felt the Standards document was well written and
inclusive and should provide a vehicle to move forward in the teaching
profession.

II. FINDINGS OF FACT

The Secretary and the State Board of Education find that these regulations
are necessary in order to further the intent of the accountability plan.
These Teaching Standards along with the Administrator Standards are the
next logical steps in standard setting following the student content
standards. These twelve standards are performance based and describe what
teachers should know and be able to do as teachers. The appropriate
distinctions between beginning and advanced practice are in the degree of
sophistication teachers exhibit in the application of knowledge and in the
breadth and depth of knowledge, rather than in the knowledge or practice
required.

These teaching standards will be the basis for designing and evaluating
teacher education programs, inducting, mentoring and assessing teachers and
in organizing in-service and professional development activities.

III. DECISION TO ADOPT REGULATIONS

For the foregoing reasons, the Secretary and the State Board of Education
conclude that the proposed regulations are necessary to continue the
standards based accountability plan. Therefore, pursuant to 14 Del. C.,
Sec. 122 the regulations attached hereto as Exhibit B are hereby adopted.
Pursuant to the provisions of 14 Del. C., Section 122(e), the regulation
hereby adopted shall be in effect for a period of five years from the
effective date of this order as set forth in Section V. below.

IV. TEXT AND CITATION

The text of the regulations adopted hereby shall be in the form attached
hereto as Exhibit B, and said regulations shall be cited in the Manual for
the Certification of Professional Public School Personnel, in a new Section
3 titled
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Professional Standards

V. EFFECTIVE DATE OF ORDER

The actions herein above referred to were taken by the Secretary with the
consent of the State Board pursuant to 14 Del. C., Sec.122 in open session
at the State Board's regularly scheduled meeting on January 15, 1998. The
effective date of this Order shall be ten days from the date this order is
published in the Delaware Register of Regulations.

IT IS SO ORDERED this 15th day of January, 1998.

Dr. Iris T. Metts

Secretary of Education

Consented to this 15th day of January, 1998.

STATE BOARD OF EDUCATION

Dr. James L. Spartz, President

Jean W. Allen, Vice President

Nancy A. Doorey

John W. Jardine, Jr.

Dr. Joseph A. Pika

Dennis J. Savage

Dr. Claibourne D. Smith

Delaware Professional Teaching Standards

1. Content: The teacher understands the core concepts and structure(s) of
the discipline(s) and creates learning experiences that make the content
meaningful to students.

The teacher...

Knowledge Components

• understands major concepts, principles, and theories that are central to
the discipline.

• understands the dynamic and complex nature of the content of the
discipline.

• understands the processes of inquiry central to the discipline.

• understands the relationship of knowledge within the discipline to other
content areas and to life applications.

Performance Indicators

• uses a variety of explanations and multiple representations of concepts
to help develop conceptual understanding.

• anticipates and adjusts for common misunderstandings that impede learning
within the discipline.

• engages students in generating and testing knowledge according to the
processes of inquiry of the discipline.

• creates learning experiences that make connections to other content areas
and to life experiences.

2. Human Development and Learning: The teacher understands how children
develop and learn and provides learning opportunities that support the
intellectual, social, emotional and physical development of the students.

The teacher...

Knowledge Components

• understands learning theory, including how students construct knowledge,
acquire skills, and develop habits of mind.

• understands human development, including the ranges of individual
variation within each domain.

• understands the interaction between student development and learning.

Performance Indicators

• chooses developmentally appropriate instructional strategies that promote
student learning.

• develops concepts and principles at different levels of complexity so
that they are meaningful to students at varying levels of development.

3. Diverse Learners: The teacher understands how students differ and adapts
instruction for diverse learners.

The teacher...

Knowledge Components

• understands how student learning is influenced by individual experiences,
talents, and prior learning, as well as language, culture, gender, health,
family, and community.

• understands differences in approaches to learning and performance,
including learning styles, multiple intelligences, and performance modes.
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• understands cultural diversity and how to incorporate multi-cultural
experiences into instruction.

• understands areas of exceptionality in learning, including talented and
gifted and special needs, and how to access strategies to accommodate
individual differences.

• understands the process of second language acquisition and how to access
strategies to support learning for students whose first language is not
English.

• understands the needs of culturally and/or linguistically diverse
students.

• understands when and how to access appropriate resources or services to
meet special learning needs.

Performance Indicators

• accepts and values all students.

• treats all students equitably.

• respects students as individuals with differing experiences, skills,
talents, and interests.

• uses cultural diversity and individual student experiences to enrich
instruction.

• designs instructional activities that address the range of student
learning styles, multiple intelligences and performance modes.

• makes appropriate provisions for individual students who have particular
learning differences or needs.

4. Communication: The teacher understands and uses effective communication.

The teacher...

Knowledge Components

• understands communication theory and its application.

• understands effective oral, written, non-verbal, and media communication
techniques.

• understands the importance of audience and purpose when selecting ways to
communicate ideas.

• understands how cultural and gender differences may affect communication
in the classroom.

Performance Indicators

• uses a variety of communication techniques.

• communicates effectively with diverse populations.

• models accurate and grammatically correct language.

• creates opportunities for students to learn effective communication.

5. Learning Environment: The teacher understands individual and group
behavior and creates a learning environment that fosters active engagement,
self-motivation, and positive social interaction.

The teacher...

Knowledge Components

• understands principles of effective classroom management.

• understands factors that influence motivation and engagement and how to
help students become self-motivated.

• understands individual behavior and how individuals behave in groups.

• understands group dynamics and how groups function within a community.

• understands how to help students learn to participate effectively in
groups.

Performance Indicators

• establishes and maintains a classroom environment with clear expectations
and standards of behavior.

• organizes, allocates, and manages time, materials, and physical space to
support learning.

• establishes classroom practices that promote a safe environment.

• creates a learning community which respects individual differences.

• establishes a classroom environment which promotes positive
relationships, cooperation, and purposeful learning.

• creates a classroom environment where student thoughts and ideas are a
basis for exploring and developing understanding.

• creates a learning community in which students work independently and
collaboratively.

• encourages students to assume responsibility for
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their own learning and behavior.

6. Planning for Instruction: The teacher understands instructional planning
and designs instruction based upon knowledge of the disciplines, students,
the community, and Delaware's student content standards.

The teacher...

Knowledge Components

• understands how to incorporate learning theory, content, curriculum
development, and assessment, and student development when planning.

• understands that effective instructional planning includes the alignment
of assessment and instruction prior to implementation.

• understands how to develop short- and long-range plans consistent with
curriculum goals, learner diversity, and learning theory.

• understands how to make connections between student experiences and
education goals.

Performance Indicators

• evaluates teaching resources and materials for accuracy and usefulness.

• applies principles of scope and sequence when planning instruction.

• creates approaches to learning that are interdisciplinary and that
integrate multiple content areas.

• creates and selects learning materials and learning experiences
appropriate for the discipline and curriculum goals.

• uses student prior knowledge and principles of effective instruction to
plan learning activities relevant to students.

• incorporates authentic experiences into instructional planning.

• creates multiple learning activities that allow for student choice.

• establishes and communicates expectations for student learning.

• creates and adapts short- and long-range plans to achieve the
expectations for student learning.

• incorporates assessment components into instructional planning.

7. Instructional Strategies: The teacher understands a variety of
instructional approaches and uses them to
promote student thinking, understanding, and application of knowledge.

The teacher...

Knowledge Components

• understands principles and techniques of a broad range of instructional
approaches, including questioning, problem solving, discourse, activation
of prior knowledge, and student reflection on learning.

• understands the relationship between instructional approaches,
assessment, and the types of learning promoted.

• understands how instructional materials and educational technologies
enhance learning.

Performance Indicators

• uses a range of instructional approaches that allows students to explore
concepts and develop an in-depth understanding of content.

• designs lessons that routinely engage students in activities that develop
problem solving and critical thinking skills.

• designs instructional activities that provide opportunities for students
to apply knowledge.

• uses a variety of materials and educational technologies to enhance
student thinking and further conceptual understanding.

• assumes different roles in the instructional process based on the content
and purposes of instruction.

• uses a range of questioning techniques to promote different levels of
understanding.

• emphasizes communication as a vehicle for learning, through the use of
discussion, listening, collaboration, and responding to the ideas of
others.

• links new concepts to student prior knowledge.

• promotes student awareness of their own thought processes and how to use
reflection to build new understandings.

• incorporates assessment components into instructional delivery.

8. Assessment: The teacher understands multiple assessment strategies and
uses them for the continuous development of students.
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The teacher...

Knowledge Components

• understands measurement theory, including principles of testing and
assessment (e.g., design, validity, reliability, and bias).

• understands assessment as a means of collecting information about student
progress.

• understands the purposes and characteristics of different kinds of
assessments.

• understands how to select, construct, and use assessment strategies and
instruments for diagnosis and evaluation of learning.

• understands how to use the results of assessment to reflect on and modify
teaching.

Performance Indicators

• uses assessment to diagnose student learning needs as a basis for
designing instruction.

• uses a variety of assessment modes and multiple measures to evaluate
student learning.

• uses both formal and informal assessment strategies to monitor and
evaluate student understanding, progress, and performance.

• aligns assessment with instruction.

• maintains accurate records and communicates student progress.

• involves students in self-assessment to help them become aware of their
strengths and needs.

• encourages students to establish personal goals for learning based on
self-assessment and assessments results.

• modifies instruction based on assessment results.

9. Professional Growth: The teacher understands the importance of
continuous learning and pursues opportunities to improve teaching.

The teacher...

Knowledge Components

• understands that reflection on teaching is an integral part of
professional growth.

• understands the implications of educational research for teaching.

• understands methods of inquiry that provide for a variety of
self-assessment and problem-solving
strategies for reflecting on practice.

Performance Indicators

• engages in continuous learning.

• participates in professional discourse about educational issues.

• uses classroom observation, information about students, pedagogical
knowledge, and research as sources for active reflection, evaluation, and
revision of practice.

• collaborates with other professionals as resources for problem solving,
generating new ideas, sharing experiences, and seeking and giving feedback.

10. Professional Relationships: The teacher understands the role of the
school in the community and collaborates with colleagues,
parents/guardians, and other members of the community to support student
learning and well-being.

The teacher...

Knowledge Components

• understands how school are organized and operate.

• understands schools as organizations within the larger community context.

• understands the importance of community-school interaction.

• understands the importance of collaboration in education.

Performance Indicators

• cooperates with colleagues to develop an effective learning climate
within the school.

• collaborates with other professionals to solve problems and make
decisions to promote student success.

• develops relationships with parents and guardians to acquire an
understanding of the students' lives outside of the school.

• works effectively with parents/guardians and other members of the
community to advocate for student need and to promote learning.

• identifies and uses community resources to enhance student learning and
to provide opportunities for students to explore career
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opportunities.

11. Educational Technology: The teacher understands the role of educational
technology in learning and uses educational technology as an instructional
and management tool.

The teacher...

Knowledge Components

• understands how to use various educational technological tools to access
and manage information.

• understands how to integrate educational technology into classroom
instruction.

• understands how to review and evaluate educational technologies to
determine instructional value.

• understands the uses of instructional technology to address student
needs.

Performance Indicators

• designs instruction to promote student skills in the use of educational
technologies to access and manage information.

• uses a wide range of instructional technologies to enhance student
learning and problem solving.

• uses technological advances in communication to enrich discourse in the
classroom.

• uses appropriate educational technology to create and maintain data bases
for monitoring student progress.

12. Professional Conduct: The teacher understands and maintains standards
of professional conduct guided by legal and ethical principles.

The teacher...

Knowledge Components

• understands school policies and procedures.

• understands legal issues in education.

• understands the codes of conduct of professional education organizations.

Performance Indicators

• acts in the best interests of students.

• follows school policies and procedures, respecting the boundaries of
professional responsibilities, when working with students, colleagues, and
families.

• follows local, state, and federal law pertaining to educational and
instructional issues, including regulations related to student rights and
teacher responsibilities.

• interacts with students, colleagues, parents, and others in a
professional manner.

• follows codes of professional conduct adopted by the Delaware
Professional Standards Council.*

*to be developed.

GLOSSARY

Alignment of Assessment

The ability to determine what students know and are able to do with respect
to the curriculum is dependent upon how well the assessment methods and
task are aligned with, or in agreement with, the curriculum. Assessments
should be aligned with the content of the curriculum, consistent with the
instructional approaches, and address the range of topics as weighted in
the curriculum.

Authentic Experiences

The use of performances, or "authentic activities", such as writing a
letter, solving a real-world mathematics problem, or investigating a
question in science, as a way to teach and to assess student learning.

Culturally and/or Linguistically Diverse

Students and families who come to schools with cultural and/or language
backgrounds that differ from the predominant experience of monolingual
English speakers. The term calls attention to the range of geographic
background, cultural heritage, and level of English proficiency found among
students in schools.

Codes of Conduct

Many professional educational organizations have adopted codes of conduct
that establish the ethical parameters that guide professional behavior. The
codes range from general guides for teachers (NEA) to more specific
guidelines for teachers of certain subject areas.

Communication Theory

An understanding of the principles of communication theory (e.g.,
productive and receptive communication,
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cultural context of language, metacommunication) as they apply in practice
in the classroom.

Community

The school community includes: teachers, administrators, students, and
parents and/or guardians. However, the schools are a part of a larger
community (i.e., neighborhood, town, city) that supports the school and the
broader society or community in which students will live.

Disciplines

Academic disciplines include the arts, humanities, languages, mathematics,
and natural and social sciences that provide the basis of the subjects
taught in schools.

Discourse

Discourse refers to both the writing and speaking in the classroom that
teachers and students engage in as they seek ways to represent ideas,
concepts and their thinking. It is the ways in which they discuss, agree
and disagree, and explore the discipline.

Diverse Learners

Students are individuals who differ in the ways in which they learn. They
have different learning styles, modalities, interests, talents and
personalities, all of which affect the ways in which teachers design
instruction.

Domains

The broad areas of human development - intellectual, social, emotional, and
physical - that influence learning.

Educational Technology

The use of any technology (e.g., word processing, data retrieval,
electronic mail ) as a set of skills that can be learned and used to
support learning in the classroom.

Habits of Mind

Mental habits influence what students do and how they learn. The
development of habits of mind, like perseverance, confidence, a willingness
to explore new ideas and experiment, seeking feedback from others, valuing
accuracy and precision, avoiding impulsivity, are a part of the teaching
and learning process.

Health

Health issues that can affect learning range from cerebral palsy, Down's
Syndrome, and other severe disabilities to less pronounced and not easily
detected concerns such as diabetes or asthma or nutrition. An awareness of
these conditions and how they affect learning furthers a teacher's ability
to meet the needs of students.

Instructional Technology

The use of specific technologies that are integrated with content to
enhance learning within the disciplines (e.g., graphing calculators in
mathematics, accounting or tax software in business, editing software for
writing).

Learning Theory

An understanding of the principles of learning theory (e.g., behaviorism,
constructivism, transmission of knowledge) as they apply in practice in the
classroom.

Meaningful (to students)

Meaningful is intended to convey a sense of purpose to students for their
learning. The content takes on significance because of the connections that
are made between the learning and students' lives. It helps students make
sense out of what they are learning.

Measurement Theory

An understanding of the principles of measurement theory (e.g., validity,
reliability, bias in testing, test construction, interpretation of tests)
as they apply in practice in the classroom.

Media Communication

The use of technologies that document events (e.g., audio-tape, videotape,
electronic transfer of information through computer programs) as a means of
communicating information.

Methods (Process) of Inquiry

Inquiry is the process through which students make new discoveries, extend
their knowledge, or deepen their understandings of things they already
know. Students need to be able to create, observe, compare, question,
record and interpret data, evaluate and revise, search resources, and share
information.

Multicultural

The term multicultural is usually used as an adjective to describe the
diverse cultural backgrounds of students and their families and school
personnel, with an emphasis on their ethnicity, race, religion, gender,
socio-economic status, and family structures. The term takes on importance
in the development of teachers as they learn to recognize the importance of
these factors in the education process.

Multiple Assessments

Decisions about what students know and are able to do should be based on an
analysis of information obtained from a variety of sources of evidence.
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Assessments should be conducted in a variety of formats (e.g., written and
oral tests, observations, performances) and address the full range of
content.

Multiple Intelligences

Based on the writing of Howard Gardner, the identification of seven
abilities (i.e., linguistic, logical-mathematical, spatial, musical,
bodily-kinesthetic, inter-personal, intra-personal) that describe distinct
aspects of "intelligent".

Non-verbal Communication

Communication through means other than the use of words (e.g., facial
expressions, body position, action).

Pedagogical Knowledge

Pedagogical knowledge is the knowledge of how to teach - the knowledge of
instructional methods.

Performance

Carrying out or completing an activity or production which displays a
student's knowledge and ability through demonstration.

Performance Modes

The range of ways in which students can demonstrate what they know and are
able to do (e.g., writing, speaking, visual works, videotapes, enacting).

Professional Growth

The process in which teachers examine the relationship between what they
and their students are doing and what their students are learning. This
process involves self-reflection and feedback from students and colleagues
and an exploration of the findings from research, as well as the use of
this information as the basis for improving personal practice in the
future.

Structures

The structures of disciplines provide the overall framework which both
connect and transcend the skills and content of the discipline. The big
picture or outline of the discipline helps students understand the
commonalties and the interrelation-ships of concepts within a discipline.

An understanding of the structure of a discipline allows students to see
connections as they acquire new knowledge.

Technology

The use of the word technology is meant to encompass both educational and
instructional technology within this document unless one of these terms is
used specifically.

Theory

The knowledge of the principles and methods of a science (e.g., learning,
measurement) as contrasted with its application.

Department of Education

Statutory Authority: 14 Delaware Code,

Section 122 (14 Del.C. 122)

BEFORE THE DEPARTMENT OF EDUCATION OF THE STATE OF DELAWARE

REGULATORY IMPLEMENTING ORDER

VOCATIONAL TECHNICAL EDUCATION PROGRAMS

I. SUMMARY OF THE EVIDENCE AND INFORMATION SUBMITTED

It is recommended that The Requirements for Vocational Technical Programs,
section V.A.3. of the Vocational Technical Education section of the
Handbook for K-12 Education be amended. The amendment is necessary to
clearly state the requirements that are regulatory. In order to achieve
this end all of the requirements have been restated as "musts" some have
been combined and items l. q., r., and s. have been eliminated. Item l.
cannot be a requirement and items q., r., and s. are required by state or
federal laws. The amended section will now become V.A.1. due to the repeal
of other sections. The section will now provide a specific list of what
must be in place for a Vocational Technical program to be approved by the
State Department of Education. Notice of the proposed regulations was
published in the News Journal and the Delaware State News on December 15,
1997, in the form hereto attached as Exhibit A. Comments were received
about the regulation from Superintendent Dr. Patricia W. Carlson, Laurel
School District, on items A.1.b. and A.2.K. Dr. Carlson was concerned about
the reference to National Standards when some programs have no National
Standards. The reference to National Standards was removed. She also
questioned the reference in A.2.K. to "two consecutive periods" as that
related to block scheduling. This concern was addressed by adding "or its
equivalent." The Advisory Council on Career and Vocational Education
commented by requesting the addition of A.2.N. which requires "program
review and monitoring visits" which was added per their request.

II. FINDINGS OF FACT

The Secretary and the State Board of Education find that the amendments are
necessary to clarify the regulatory intent of the original regulations. The
changes have added
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clarity and have eliminated items which do not need to be regulated.

III. DECISION TO AMEND REGULATIONS

For the foregoing reasons, the Secretary and the State Board of Education
conclude that the proposed amendments are necessary to clarify the intent
of the original regulations. Therefore, pursuant to 14 Del. C., Section 122
the regulations attached hereto as Exhibit B are hereby adopted. Pursuant
to the provisions of 14 Del. C., Section 122(e), the amendment hereby
adopted shall be in effect for a period of five years from the effective
date of this order as set forth in Section V. below.

IV. TEXT AND CITATION

The text of the regulations adopted hereby shall be in the form attached
hereto as Exhibit B, and said regulations shall be cited as, Requirements
for Vocational Technical Programs , section V.,1., in the Handbook for K-12
Education.

V. EFFECTIVE DATE OF ORDER

The actions herein above referred to were taken by the Secretary pursuant
to 14 Del. C., Section 122 in open session at the State Board's regularly
scheduled meeting on January 15, 1998. The effective date of this Order
shall be ten days from the date this order is published in the Delaware
Register of Regulations.

IT IS SO ORDERED this 15th day of January, 1998.

Dr. Iris T. Metts

Secretary of Education

Consented to this 15th day of January, 1998.

STATE BOARD OF EDUCATION

Dr. James L. Spartz, President

Jean W. Allen, Vice President

Nancy A. Doorey

John W. Jardine, Jr.

Dr. Joseph A. Pika

Dennis J. Savage

Dr. Claibourne D. Smith

AS AMENDED

V. VOCATIONAL-TECHNICALEDUCATION PROGRAMS

A. REQUIREMENTS FOR VOCATIONAL-TECHNICAL EDUCATION PROGRAMS

1. All Vocational Technical Programs must:

a. meet the provisions of Delaware's State Plan for Vocational Education.

b. meet the provisions of the content standards approved by the Department
of Education or if there are no approved state content standards meet [the
national program standards.] [local program standards approved by the
Department of Education]

2. All local school districts offering state approved vocational-technical
education programs must:

a. have the approval of the Department of Education before implementing new
programs. New programs of a similar nature may not be approved where
enrollment may compete with already existing programs.

b. have adequate funding to support and sustain the instructional program.

c. employ teachers certified in vocational technical education program
areas.

d. make provisions for meeting the unique needs of all students.

e. establish and maintain an active advisory committee which includes labor
and management personnel to assist in the development and operation of the
program.

f. use present and projected labor market information, available from the
Delaware Occupational Information Coordinating Committee, to determine the
need for new and continuing vocational-technical education programs.

g. survey local business and industry to determine their occupational needs
and the availability of placement and employment opportunities for program
completers.

h. survey the student population to determine their occupational interests
and needs.

i. organize and financially support vocational-technical student
organizations as integral components of vocational-technical education
programs in public schools that complement and enrich instruction. The
following vocational student organizations are affiliated in Delaware:

Business Professionals of America (BPA)

Technology Student Association (TSA)

Distributive Education Clubs of America (DECA), an association of marketing
students

Future Homemakers of America (FHA/HERO)

The National FFA Organization

Vocational Industrial Clubs of America (VICA)

j. integrate related academic content into individual vocational-technical
courses, and guide students through a course selection process that
supports the necessary academic preparation required by the student's
career path and educational goals.

k. schedule trade and industrial education programs, when offered, for a
minimum of two consecutive periods a day [and preferably three periods,]
[or the equivalent] five days a week for two or more years. Trade and
Industry programs are highly specialized and are
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conducted in comprehensive vocational technical school districts. Any
exception must be requested in writing showing just cause, and be approved
by the Department of Education.

l. establish no rules practices or regulations that interfere with,
prohibit or otherwise prevent students from having the opportunity to learn
about, enroll in and complete a vocational technical education program in a
Vocational Technical School District.

m. use equipment and facilities comparable to that used by local business
and industry for which the vocational technical program is preparing
students.

[n. Schedule Department of Education and Delaware Advisory Council on
Career and Vocational program review and monitoring visits upon request.]

3. VOCATIONAL-TECHNICAL EDUCATION PROGRAM REQUIREMENTS

Requirements for organizing and implementing vocational education programs
include the following:

a. All programs must meet the provisions of Delaware's State Plan for
Vocational Education.

b. All programs must meet the provisions of the content standards approved
by the State Board of Education.

c. New programs and new courses being established must have the
recommendation of the Department of Public Instruction and approval of the
State Board of Education prior to implementation on the local level.

d. Funding must be provided to support and sustain the instructional
program.

e. A staff member meeting certification requirements in the
vocational-technical education program area must be provided to teach the
course.

f. Funding provisions must be made for meeting the unique needs of all
students.

g. An advisory committee which includes labor and management personnel must
be organized to assist in the development and operation of the program.

h. Present and projected labor market information, available from the
Delaware Occupational Information Coordinating Committee, should be used in
determining the need for new and continuing vocational-technical education
programs.

i. Local business and industry should be surveyed by local school districts
to determine occupational needs, availability of placement and employment
opportunities for program completers.

j. The student population should be surveyed by local school districts to
determine occupational
interests and needs.

k. Equipment and facilities should be comparable to that used by business
and industry.

l. Students enrolled in vocational-technical education programs should be
able to benefit from the instructional process and have the potential of
being employed by business and industry in the occupation for which they
were trained.

m. Trade and industrial sequential programs of a highly specialized nature
should be conducted at the vocational-technical schools. Programs other
than trade and industrial programs which provide entry level skills meeting
approved content standards may be conducted in the comprehensive K-12
school district. New programs of a similar nature will not be approved
where enrollment may compete with programs at vocational-technical schools
or regular high schools.

Trade and industrial education programs must be offered a minimum of two
consecutive periods a day and preferably three periods, five days a week
for two or more years. Any exception must be requested in writing showing
just cause, and be approved by the State Department of Public Instruction.

n. All programs should reflect the National standards developed as quality
indicators for Technology Education, Trade and Industrial Education, Home
Economics, and Agriculture.

o. Vocational-technical student organizations shall be organized as
integral components of vocational-technical education programs in public
schools to complement and enrich instruction.

(1) "Local plans and any program proposals submitted for State Board
approval and/or funding shall contain adequate provision for support of
each vocational student organization affiliated with the
vocational-technical education program(s) offered in each school." (State
Board Approved June 1973)

(2) The following vocational student organizations are affiliated in
Delaware:

(a) Business Professionals of America (BPA )

(b) Technology Student Association (TSA )

(c) Distributive Education Clubs of America (DECA)

(d) Future Homemakers of America (FHA/HERO)

(e) Future Farmers of America (FFA)

(f) Vocational Industrial Clubs of America (VICA)

p. Vocational programs of instruction are required to be taught in a manner
that fully integrates
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academic and vocational subject matter. Students should be guided through a
sequential course selection process that reflects the necessary academic
preparation required by the student's vocational course and career goals.

q. Inventory requirements for equipment purchased with state and federal
funds require that equipment records must be maintained and a physical
inventory must be taken once every two years. A control system must be in
effect to insure against loss, damage, or theft. Adequate maintenance
procedures must be implemented, and proper disposal procedures must be
followed for unneeded property.

r. Vocational-technical education programs must be monitored by the
Department of Public Instruction to assure compliance with the Office for
Civil Rights Guidelines for Vocational Education Programs.

s. It is the policy of the Delaware State Board of Education that an
effective safety education program be conducted through the school system
with its prime objective being accident prevention.

t. Local school districts shall not establish policies, practices, rules or
regulations that interfere with, prohibit or otherwise prevent students
from having the opportunity of learning about, enrolling in and completing
a vocational education program in a Vocational-Technical School District.
(State Board Approved March 1985, Revised June 1990)

Department of Education

Statutory Authority: 14 Delaware Code,

Section 122 (14 Del.C. 122)

BEFORE THE DEPARTMENT OF EDUCATION OF THE STATE OF DELAWARE

REGULATORY IMPLEMENTING ORDER

REPEAL OF VOCATIONAL TECHNICAL EDUCATION SECTIONS

I. SUMMARY OF THE EVIDENCE AND INFORMATION SUBMITTED

The repeal of the following ten parts from section V., Vocational Technical
Education Programs in the Handbook for K-12 Education is recommended. The
parts include, A.1., Purpose of Vocational Technical Education, A.2.,
Vocational Technical Program Areas, B.1., Applying for State Vocational
Education Program Funding, C., Evaluation and Monitoring, D.1., Technical
Preparation Programs, D.3., Work Study Programs, F.1., Regular Vocational
Technical Education Students, F.2., Vocational Technical Education Unit,
G.1., Federal Project Application Process and Procedure, and H., Vocational
Assessments for Special Populations of Students, H.1., Requirements. The
repeals are re
quired because these parts either repeat federal or state laws or simply
provide technical assistance on issues. Part A.3., Requirements for
Vocational Education Program, is regulatory as amended and reflects the
bulk of the Vocational Technical Program regulations in Section V. of the
Handbook for K-12 Education. The two remaining parts D.2. a-g, Cooperative
Education, and E.1. a and b., Credit for Vocational Technical Programs,
will be brought back for extensive amendments in three or four months. For
now, with all of the repealed parts eliminated, D.2. a-g., will become B.1.
and 2.(a)(1)-(7) and E.1. a and b will become C.1. (a) and (b). Notice of
the proposed repeal of regulations was published in the News Journal and
the Delaware State News on December 15, 1997, in the form here to attached
as Exhibit A. There were no comments received concerning the regulations.

II. FINDINGS OF FACT

The Secretary and the State Board of Education find that it is necessary to
repeal these regulations because they either repeat state and federal laws
or simply provide technical assistance on issues.

III. DECISION TO REPEAL REGULATIONS

For the foregoing reasons, the Secretary and the State Board of Education
conclude that it is necessary to repeal these regulations. Therefore,
pursuant to 14 Del. C., Section 122., the regulations attached hereto as
Exhibit B are hereby repealed.

IV. TEXT AND CITATION

The text of the regulations repealed hereby shall be in the form attached
hereto as Exhibit B, and said regulations shall be removed from the:
Handbook for K-12 Education.

V. EFFECTIVE DATE OF ORDER

The actions herein above referred to were taken by the Secretary pursuant
to 14 Del. C., Section 122 in open session at the State Board's regularly
scheduled meeting on January 15, 1998. The effective date of this Order
shall be ten days from the date this order is published in the Delaware
Register of Regulations.

IT IS SO ORDERED this 15th day of January, 1998.

Dr. Iris T. Metts

Secretary of Education

Consented to this 15th day of January, 1998.

STATE BOARD OF EDUCATION

Dr. James L. Spartz, President

Jean W. Allen, Vice President

Nancy A. Doorey

John W. Jardine, Jr.
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Dr. Joseph A. Pika

Dennis J. Savage

Dr. Claibourne D. Smith

V. VOCATIONAL-TECHNICAL EDUCATION PROGRAMS

A. VOCATIONAL-TECHNICAL EDUCATION

1. PURPOSE OF VOCATIONAL-TECHNICAL EDUCATION

a. To provide a total program of offerings which is in full partnership and
equal standing with all components of the educational systems and is:

(1) capable of meeting the individual needs, interests, abilities, and
aspirations of each student; and

(2) realistic in light of actual or anticipated opportunities for
employment, advancement education, and practical life application.

b. Specific purposes of vocational-technical education are:

(1) to prepare individuals for entry-level employment and adaptability in
later employment in recognized occupations, new occupations, and emerging
occupations at various levels of competence ;

(2) to prepare individuals for participation in advanced or highly skilled
post-secondary vocational and technical education such as school-to-work
transition programs;

(3) to provide individuals with laboratory experiences and activities for
vocational skill development and assist them in making informed and
meaningful occupational choices; and

(4) to provide individuals with laboratory experiences and activities which
assist them 1) in the making of informed consumer decisions and 2) in the
application of practical life skills including but not limited to civic
consciousness, social and inter-personal relationships, leadership,
responsibility, and an appreciation for their potential productivity and
contribution in the world of work and to provide appropriate programs and
supportive services for persons who have academic, socioeconomic, or other
disadvantages or disabilities that would prevent them from succeeding in
regular programs.

2. VOCATIONAL-TECHNICAL EDUCATION PROGRAM AREAS

a. Agriscience

b. Allied Health Education

c. Business Finance and Marketing

d. Diversified Occupations

e. Home Economics

f. Technology Education

g. Trades and Industrial Education

B. STATE FUNDED VOCATIONAL-TECHNICAL EDUCATION PROGRAMS

1. APPLYING FOR STATE VOCATIONAL-TECHNICAL EDUCATION PROGRAM FUNDING

State funding is provided for vocational-technical education programs
conducted in the local school districts which meet or exceed the state
curriculum content standards and other criteria established by the school
district. In new vocational-technical education programs being requested,
the form titled Application for Approval of New Vocational-Technical
Education Programs must also be completed and returned. New
vocational-technical education program requests must include the following:

a. program purpose, outline and statement of objectives that satisfy or
exceed approved state content standards. NOTE: If state curriculum content
standards have not been approved for this program, suggested standards
developed according to the state format, must be submitted;

b. documentation justifying need for program, i.e., advisory committee
membership and minutes, Labor Department projections, and student interest
survey results;

c. a signed Statement of Assurances which is included in the application
forms sent to chief school officers the first week in January; and

d. course outlines for approved vocational-technical education programs are
to be updated and resubmitted every three years. Any program on the
approved list which has not been in operation during the past two years
will be deleted and will require a new application to be reactivated.

C. EVALUATION AND MONITORING

All vocational-technical schools are encouraged to participate in the
accreditation and review process of the Middle States Association of
schools and colleges. The Department of Public Instruction is responsible
for monitoring all federally supported vocational programs.

The Federal program evaluations are based primarily on the objectives,
activities, and evaluation criteria stated in the approved project
proposals. Evaluation visits are scheduled in conjunction with the State
Council on Career and Vocational Education.

D. ALTERNATIVE METHODS OF INSTRUCTION

1. TECHNICAL-PREPARATION PROGRAMS

a. The technical preparation program which is also called "Tech Prep" or
"Two plus Two" is the formal coordination (through written agreement) of
vocational-technical secondary and post-secondary education curricula. This
four-year program begins in the junior year
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of high school and culminates at the second year of post-secondary school.

b. Students may earn post-secondary units of credit prior to high school
graduation through participation in this program.

c. A sequential curriculum of academic and technical courses with an
integrated approach to the teaching of all subject matter shall be the goal
of all tech prep programs.

3. WORK STUDY PROGRAMS

Work study programs that meet established guidelines are specialized
programs for disadvantaged students who are in need of financial assistance
and are at risk of leaving school. Students must meet the following
qualifications:

a. have been accepted for enrollment as a student in an approved vocational
education program or already participating in a vocational-technical
education plan;

b. are at least fifteen (15) years of age and less than twenty- one (21)
years of age at the commencement of employment;

c. are capable of maintaining good standing in their vocational-technical
education programs, including other academic content areas, while employed;
and

d. are employed by the local educational agency or by other public or
nonprofit private agencies or institutions where they may earn up to
$900.00 under minimum wage provisions.

F. VOCATIONAL-TECHNICAL EDUCATION UNIT SYSTEM FOR STATE FUNDING

1. REGULAR VOCATIONAL-TECHNICAL EDUCATION STUDENTS

a. Regular or special education students who are enrolled in State Board of
Education approved vocational-technical education courses are to be
included in the vocational enrollment and unit count.

b. The distribution of state funds to school districts is based on the
"unit" allotment. The secondary unit consists of one teacher for 20
secondary pupils in grades 7-12. (The State makes special provision for
children with disabilities by providing for a unit on the basis of a fewer
number of pupils.)

c. A maximum of 900 minutes of vocational time per week per student may be
credited toward the vocational unit determination.

2. VOCATIONAL-TECHNICAL EDUCATION UNIT

a. The basis for computing the vocational unit of 27,000 pupil minutes is
as follows: 30 students per teacher (enrollment 15 to 1 in two 3-hour
sessions) times 900 minutes per week instruction for a full-time vocational
student (180) minutes per day x 5 days per week) equals
27,000 pupil minutes to the unit:

30 x 900 = 27,000

(1) The vocational units for the new full-time New Castle, Polytech, and
Sussex Vocational-Technical School Districts shall be calculated on 30
pupils enrolled in vocational-technical education courses as of the last
day of September. 14 Del. C. ¤1703(g) prescribes the unit system formula.

b. Where each of 30 full-time students does not apply, any number of
students and their minutes may total 27,000, eg., a vocational unit (with
the same limits of 180 minutes per day per student and 900 minutes per week
per student). For example, 60 students, each with 450 minutes per week,
equals a vocational unit of 27,000 minutes .

c. One-half of the vocational units of pupils shall be deducted from the
regular unit entitlement of a comprehensive high school according to the
following formula:

vocational units x .5 = deductible (a major fraction shall be considered a
whole unit)

d. The "vocational deduct" is applied to partially compensate for the
double counting of the vocational students. The deduction is computed on a
district basis as follows: The number of Division I vocational units earned
in the schools of a district plus the number of "other" vocational units
earned by the district's regular and special students who attend vocational
programs in area vocational schools divided by two equals the deduct; the
deduction will always be rounded off to a whole number. For example:

District vocational units 20

Other vocational units + 11 3115 deduct

e. Summer Vocational-Technical Education Students

Students enrolled in a summer vocational program which has been approved
annually by the State Board of Education, and which is conducted by any
school district beyond and in addition to the school year as defined by 14
Del. C. ¤1023, may be counted in a unit of pupils, grades 7 through 12
inclusive, at the rate of 27,000 pupil minutes per week or major fraction
thereof after the first full unit.

f. Co-operative Vocational-Technical Education Students

Minutes generated through co-operative work experience programs shall count
one-half as much as those generated by pupils enrolled in school based
vocational-technical instruction programs. For example, for a pupil who
spends 20 periods per week in a co-operative work experience program, the
school district shall claim only one-half the 20 periods, or 10 pupil
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periods. Teacher class time (one period for each 15 students counted) must
be provided for coordination of students' on-the-job experiences. Students
must be enrolled in an approved related vocational-technical program.

G. HOW TO APPLY FOR FEDERAL VOCATIONAL-TECHNICAL EDUCATION PROGRAM FUNDS

1. FEDERAL PROJECT APPLICATION PROCESS AND PROCEDURE

a. All persons planning to submit applications for funding should
familiarize themselves with the provisions and regulations set forth in the
current State Plan for Vocational Education and the appropriate curriculum
content standards. Copies of the State Plan for Vocational Education may be
found in school libraries and district offices with the person responsible
for vocational-technical education programs.

(1) Projects will be reviewed for compliance with Federal regulations and
compliance with Office for Civil Rights Guidelines.

(2) Projects will be reviewed by the staff from the Department of Public
Instruction according to:

(a) pertinence of programs to the workplace and to new and merging
technologies;

(b) responsiveness of programs to the current and projected occupational
needs in the state;

(c) capacity of programs to facilitate entry into, and participation in,
vocational-technical education and to ease the school-to-work and secondary
to post-secondary transitions;

(d) technological and educational quality of vocational-technical
curricula, equipment and instructional materials to enable vocational
students and instructors to meet the technological demands of the
workplace;

(e) capacity of vocational-technical education programs to meet the needs
for general occupational skills and the improvement of academic foundations
in order to address changing job requirements.

(3) Technical assistance is provided by the Department of Public
Instruction who review the objectives, activities, timelines and evaluation
criteria of each project. They are committed to working with potential
service providers before and/or during the application process in refining
the elements of the project application.

H. VOCATIONAL ASSESSMENTS FOR SPECIAL POPULATIONS OF STUDENTS

1. REQUIREMENTS

a. Every student with a disability enrolling
or enrolled in a vocational education program shall receive assessment of
interests, abilities, and special needs with respect to successfully
completing the vocational education program (P.L. 107.392 [c]) for students
with disabilities and other special populations of students.

b. Additional vocational assessment may be indicated if test data does not
give sufficient information for programming and placement of the student,
or the student is not succeeding in the vocational program. Additional
information is needed if the student is at risk of dropping out of school,
or by the appropriate adult service agency during the formal referral
process in the student's final year.

c. Individual programs of students who meet any of these four criteria will
be reviewed by the IEP team in the case of identified special education
students, and the student's advisor/counselor in other cases, to determine
the need for additional vocational assessment.

d. Vocational assessment instruments must be appropriate for the population
being tested. This includes: age, disability, reading levels, native
language/primary communication mode.

e. Vocational assessment will be administered by staff trained to give the
assessment.

f. Vocational assessment data will be reviewed with students and parents by
designated staff members.

Department of Finance

Division of Revenue

Statutory Authority: 30 Delaware Code,

Sections 354 & 563 (30 Del.C. 354, 563)

BEFORE THE DELAWARE STATE LOTTERY OFFICE

IN RE: PROPOSED RULES AND REGULATIONS

ORDER

Pursuant to 29 Del. C. section 4805(a), the Delaware State Lottery Office
hereby issues this Order promulgating the proposed Video Lottery Employee
Organization and Lottery Employee Regulations. Following notice and a
public hearing held on September 23, 1997, the Lottery Office makes the
following findings and conclusions:

SUMMARY OF EVIDENCE AND INFORMATION SUBMITTED

1. The Lottery Office posted public notice of the proposed Regulations in
the Register of Regulations and in the News-Journal and Delaware State
News. The Lottery Office received no written comments from the public
concerning the proposed Regulations prior to the public hearing. 2. The
Lottery Office conducted a public hearing on the proposed Regulations on
September 23, 1997. Prior
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to the hearing, the Lottery Director Wayne Lemons designated Video Lottery
Operations Manager Donald Johnson as the hearing officer.

3. At the public hearing, the Lottery received into evidence a written
report from Captain Scott Rugen of the Delaware State Police (marked
exhibit #4). The report summarizes the position of the Delaware State
Police in support of the proposed Regulations.

4. The Lottery Office also received testimony from George Smiley at the
hearing. Mr. Smiley testified that he is the Secretary/Treasurer of
Teamsters Local Union 326. Mr. Smiley objected to several of the proposed
Regulations. After the hearing, Mr. Smiley sent a letter dated September
24, 1997 to the hearing officer which reiterated much of the same
objections raised at the public hearing. This letter is incorporated into
the record. The following is a summary of the comments presented by Mr.
Smiley:

i. Section 3.2(3) requesting information about the original creation of the
employee organization. Mr. Smiley stated that the original creators of the
organization are not relevant to the fitness of the organization if those
persons are no longer involved with the employee organization. ii. Sections
3.2(4-5) requesting information about the parent body and affiliates of the
employee organization. Mr. Smiley stated that this information is
unnecessary because the employee organization is essentially an entity
independent of the parent body and any affiliates.

iii. Section 3.2(7) requesting information about the pension and welfare
systems maintained by the employee organization and the party managing the
fund. Mr. Smiley stated that this information is not relevant since the
statute only prohibits an organization from holding direct financial
interests in video lottery agents.

iv. Section 3.2(8)(f) requesting information about the annual compensation
of all employee organization personnel. Mr. Smiley stated that this
information is not relevant and is already disclosed pursuant to federal
labor laws.

v. Section 3.2(9) and section 4.2(15) requesting any other information that
the Director determines is needed to determine competence, honesty, and
integrity. Mr. Smiley objected to this regulation as providing too much
open-ended discretion to the Lottery Director.

vi. Section 3.2(12) requesting a list of any litigation involving the
employee organization. Mr. Smiley questioned what type of litigation cases
would be included within this Regulation. For example, Mr. Smiley
questioned whether the Regulation would apply to unfair labor practice
charges or arbitration cases brought by or against the employee
organization.

vii. Section 3.2(14) and section 4.2(18) requiring a waiver of liability to
the State from any disclosure of information acquired during the
investigation process. Mr. Smiley questioned why the Lottery Office would
be releas
ing any information obtained during the application process.

viii. Section 4.2(10)(ii) requiring key employees disclose criminal
offenses for which they have been charged, indicted, or summoned but not
convicted. Mr. Smiley stated that key employees should only be required to
disclose information about convictions.

ix. Section 4.2(13) requiring key employees disclose whether they have ever
been subpoenaed as a witness before any grand jury, legislative body,
administrative body, or crime commission. Mr. Smiley objected to this
requested information as irrelevant.

x. Section 4.2(17) requesting the key employee applicants execute a Release
Authorization for the release of information about the applicant. Mr.
Smiley stated that the portion of this Release directed to financial
institutions would request personal financial information which is
irrelevant.

FINDINGS OF FACT

5. The public was given notice and an opportunity to provide the Lottery
Office with comments in writing and by oral testimony on the proposed
regulations. The evidence received by the Lottery Office is summarized in
paragraphs #3 and #4.

6. The proposed Regulations were required by the passage of House Bill No.
18 as amended by House Amendment No. 1, Del. Laws Volume 71, Chapter 184.
Section 4805(a)(24)(f) of 29 Del. C. requires the Lottery Office to enact
regulations for the registration of employee organizations and key
employees. The legislation provided the Lottery Director with specific
standards to review and assess the competency of employee organizations and
key employees who wish to represent employees of a Delaware video lottery
agent. For example, section 4805(a)(24)(c)(ii) provides:

(c) The application for registration by an employee organization or key
employee of such employee organization may be denied or registration
revoked under the following circumstances:

(ii) The applicant's competence, honesty, or integrity pose a threat to the
public interest of the State or to the reputation of or effective
regulation and control of the video lottery based on the applicant's
associations or by virtue of the fact that the applicant has been convicted
of a felony crime of moral turpitude or has been arrested for an act
constituting racketeering under 11 Del. C. section 1502(9)(a)(b)(2)(4-10)
within ten (10) years prior to applying for registration hereunder or at
anytime thereafter....

29 Del. C. section 4805(a)(24)(c)(ii).

7. The Lottery Office has considered the comments and evidence offered at
the public hearing. These comments were reviewed in light of the statutory
language
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of House Bill 18 and the general powers of the Lottery Director under title
29, chapter 48. The Lottery Office finds that the majority of the proposed
Regulations are directly related to the powers and obligations of the
Lottery under the statute.

8. The Lottery Office received no comments about Chapters 1.0, 2.0, 5.0,
6.0, and 7.0. The Lottery Office will adopt these Regulations as proposed
with the exception of the proposed Regulation 6.1. The hearing officer upon
review of this Regulation finds that Regulation 6.1 should be clarified.
Regulation 6.1 should be amended to specifically provide that applicants
for employment with the Lottery Office who do not meet minimum requirements
under the Lottery statute and Regulations can not be employed by the
Lottery. The Lottery will not enact Regulation 6.1 as proposed. The Lottery
will renotice a revised form of Regulation 6.1 which provides:

6.1 The Director shall conduct employment investigations for any person
seeking employment with the Agency for compensation for a position which
has direct access to lottery ticket sales agents, video lottery agents, or
vendors. Those new employee applicants who do not meet the requirements of
these Regulations and 29 Del. C. chapter 48 shall not be permitted to be
employed by the Lottery.

9. The Lottery Office finds that proposed Regulation 3.2(3) requests
information from employee organizations about the persons creating the
organization. This information is clearly relevant for the Lottery's
investigation of the fitness and competence of the employee organization as
required by 29 Del. C. section 4805(a)(24)(c)(ii). The Lottery and Delaware
State Police, in investigating the fitness of an organization, certainly
need to know how long that organization has existed and from where it was
created. The Lottery statute also requires the Lottery consider the
associations of the employee organization and the key employee. Regulation
3.2(3) seeks information that is relevant to the association of any former
founders of the organization in the current organization. This Regulation
3.2(3) will be enacted in its proposed form.

10. The Lottery Office finds that proposed Regulation 3.2(5) requests
information from employee organization about the role of any affiliate in
the activities of the organization in representing video lottery employees.
This information is relevant to the Lottery's duty to determine who is the
actual applicant and what other entities if any control that applicant.
Regulation 3.2(5) will be enacted in its proposed form.

11. The Lottery Office finds that proposed Regulation 3.2(7) requests
general information from an employee organization applicant about its
pension and welfare systems. This information is relevant to the statutory
requirement that an employee organization have no direct financial interest
in any video lottery agent. 29 Del. C. section
4805(a)(24)(c)(iv). The requested information is readily accessible to an
employee organization and is necessary for the investigation to be
conducted by the Lottery and Delaware State Police. This Regulation 3.2(7)
will be enacted in its proposed form.

For the sake of organization, the Lottery will reorder Regulations 3.2(6)
and (7).

12. The Lottery Office finds that proposed Regulation 3.2(8)(f) requests
the annual compensation of employee organization personnel. This
information is relevant to assessing the competence and fitness of an
employee organization. The role of each member of the organization and
their respective position in the organization are relevant to a complete
consideration of the makeup and operation of the employee organization. The
representative from the Teamsters Local objected to this information in
part because it is already disclosed by labor organizations under federal
law. If the information is already public pursuant to federal requirements,
the Lottery sees no burden to an employee organization from supplying the
same information to a state investigating office. This Regulation 3.2(8)(f)
will be enacted in its proposed form.

13. The Lottery Office finds that proposed Regulations 3.2(9) and 4.2(15)
provide the Lottery Director with the power to request additional
information relevant to an applicant's competence, honesty, or fitness.
These Regulations simply provide the Director with the same powers that
already exist under the statutory scheme enacted by House Bill 18. The
Lottery will amend these regulations to add the phrase "necessary and
reasonably related" after the word "needed" in the proposed regulations.
The Lottery will renotice a new proposed Regulations 3.2(9) and 4.2(15)
that provide as follows:

3.2 The employee organization shall register with the Agency on
registration forms supplied by the Agency. Registration forms shall require
the employee organization to provide the following, without limitation:

...

(9) Any other information the Director determines is needed, necessary, and
reasonably related to the competence, honesty, and integrity of the
applicant or registrant as required by title 29 of the Delaware Code.

4.2 The key employee shall register with the Agency on registration forms
supplied by the Agency. Registration forms shall require the key employee
to provide the following, without limitation:

(15) Any other information the Director determines is needed, necessary,
and reasonably related to the competence, honesty, and integrity of the
applicant or registrant as required by Title 29 of the Delaware Code.

14. The Lottery Office finds that proposed Regulation 3.2(12) requests the
employee organization list litigation from the last five years. In order to
assess the
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competence, honesty, and integrity of the organization, it is necessary
that the Lottery know the types of legal cases in which the employee
organization has been involved. Cases raising bad faith claims against an
employee organization are certainly relevant to the competence of the
organization. The Lottery will propose a new rule that limits disclosure to
litigation known to the employee organization. The Lottery will renotice a
new proposed Regulation 3.2(12) which provides as follows:

3.2 The employee organization shall register with the Agency on
registration forms supplied by the Agency. Registration forms shall require
the employee organization to provide the following, without limitation:

...

(12) A list of any known litigation involving the employee organization
over the last five years.

15. The Lottery Office finds that proposed Regulation 3.2(14) requests the
employee organization execute a waiver of liability from any disclosure or
publication of information obtained during the investigation process. The
proposed Regulation 4.2(18) requests a similar waiver from key employee
applicants. This Regulation is not intended to provide for public
dissemination of the investigatory materials but to protect the State in
the event such materials are in fact disclosed or published. The Lottery
could be required, for example, to disclose investigation files pursuant to
a subpoena or Court order. This Regulation is a good faith attempt to limit
the State's liability in the case of such an event. The Lottery will enact
Regulations 3.2(14) and 4.2(18) in their proposed form.

16. The Lottery Office finds that proposed Regulation 4.2(10)(ii) requests
that key employee applicants disclose criminal offenses for which they have
been charged but not convicted. This information is clearly relevant to an
investigation of the key employee's competence, honesty, or integrity. In
fact, section 4805(a)(24)(c)(ii) specifically addresses cases where a key
employee may be disqualified on the basis of an arrest for an offense that
is still pending. The regulation as drafted allows the Lottery to obtain
the criminal history of the applicant or registrant in order to determine
if there are any offenses that fit within the statutory grounds for
disqualification under 29 Del. C. section 4805(a)(24)(c)(ii). The Lottery
will renotice a proposed Regulation 4.2(10)(ii) which provides as follows:

4.2 The key employee shall register with the Agency on registration forms
supplied by the Agency. Registration forms shall require the key employee
to provide the following, without limitation:

...

(10) Excluding minor traffic offenses, a detailed description of the
following areas of criminal conduct, if any, including whether the crime
involved is denominated a felony or a misdemeanor:

(ii) Any criminal offenses, that occurred within
ten years of the application or registration, for which the applicant or
registrant was arrested, charged, indicted, or summoned to answer, which
are pending or for which he was not convicted;

17. The Lottery Office finds that proposed Regulation 3.2(4) requests that
an employee organization provide information about the parent body of the
organization and all affiliates. The Lottery finds that the name and
address of the parent body is relevant to review and consideration of the
competence and fitness of the employee organization. The Lottery finds
relevant the names of any parent or affiliate which will control the
registrant. This information is necessary to determine who in fact is the
applicant. The Lottery agrees in part with the comments offered at the
public hearing that the request for information about all other affiliates
is unnecessary. The Lottery will not enact this Regulation in its proposed
form. The Lottery will renotice a proposed Regulation 3.2(4) which will
provide as follows:

3.2 The employee organization shall register with the Agency on
registration forms supplied by the Agency. Registration forms shall require
the employee organization to provide the following, without limitation:

(4) The name and address of all affiliates which are either a parent body
or any superior organization with any right or ability to control,
supervise, discipline or set policy for this organization.

18. The Lottery Office finds that proposed Regulation 4.2(13) requests that
a key employee state whether he has ever been a witness before a grand
jury, legislative body, administrative body, or crime commission. The
Lottery agrees in part with the comments at the public hearing that this
request is too general. The requested information should be limited to
instances when the key employee applicant was called to testify on matters
pertaining to his competence, honesty, or integrity in operations of an
employee organization. The Lottery will not enact the proposed Regulation
4.2(13). The Lottery will renotice a new proposed Regulation 4.2(13) which
will provide:

4.2 The key employee shall register with the Agency on registration forms
supplied by the Agency. Registration forms shall require the key employee
to provide the following, without limitation:

(13) Whether he has ever been subpoenaed as a witness before any grand
jury, legislative body, administrative body, or crime commission on matters
pertaining to the operation or performance in any labor organization, which
shall include all details relating thereto.

19. The Lottery Office finds that proposed Regulation 4.2(17) requests key
employee applicants execute a Release Authorization to allow the Delaware
State Police to perform a background investigation of the applicant. The
Lottery finds that the requested information with one exception is
necessary to permit the Delaware State Police
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to investigate the competence, honesty, and integrity of the applicant. The
Lottery relies in part on the Staff Report of the Delaware State Police
that such information is necessary for completion of a background
investigation. The Lottery also notes that the same type of information is
currently already requested by the Lottery's Video Lottery Regulations for
employees of video lottery agents and technology vendors. The Lottery does
believe that the proposed regulation should be revised to specify the
purpose of the requested information. Also, the Lottery does question the
necessity for a release of information from selective service boards. The
Lottery believes this portion of the Regulation should be deleted. The
Lottery will renotice a new proposed Regulation 4.2(17) which provides as
follows:

4.2(17) A Release Authorization directing all courts, probation
departments, employers, educational institutions, financial and other
institutions and all governmental agencies to release any and all
information pertaining to the applicant or registrant as requested by the
Agency or the Delaware State Police that bears on and is necessary and
reasonably related to the statutory standards of competence, honesty, or
integrity as specified by 29 Del. C. section 4805(a)(24)(c)(ii).

CONCLUSIONS

20. The proposed Regulations were promulgated by the Lottery Office in
accord with its statutory duties and authority as set forth in 29 Del. C.
section 4805(a).

21. The Lottery deems the proposed Regulations, with the exception of the
specific rules previously mentioned, necessary for the effective
enforcement of 29 Del. C. section 4805 and for the full and efficient
performance of the Lottery's duties thereunder. The Lottery concludes that
the adoption of the proposed Regulations, with the noted exceptions, would
be in the best interests of the citizens of the State of Delaware and
consonant with the dignity of the State and the general welfare of the
people under section 4805(a).

22. The Lottery, therefore, adopts pursuant to 29 Del. C. section 4805 and
29 Del. C. section 10118 the proposed Video Lottery Employee Organization
and Lottery Employee Regulations except for proposed Regulations 3.2(4),
3.2(9), 3.2(12), 4.2(10)(ii), 4.2(13), 4.2(15), 4.2(17), and 6.1. The
Lottery has considered the comments and suggestions made by the witnesses
at the public hearing.

23. The Lottery does not adopt the proposed Regulations 3.2(4), 3.2(9),
3.2(12), 4.2(10(ii), 4.2(13), 4.2(17) and 6.1 and will post notice of a new
proposal for enactment of these four Regulations.

24. The effective date of this Order shall be ten (10) days from the date
of publication of this Order in the Register of Regulations on February 1,
1998.

Donald Johnson

Hearing Officer

Delaware State Lottery Office

It is So Ordered This ___________day of ___________, 1998.

DELAWARE STATE LOTTERY OFFICE

VIDEO LOTTERY EMPLOYEE ORGANIZATION

AND LOTTERY EMPLOYEE REGULATIONS

1.0 Introduction

These regulations are authorized pursuant to section 4805 of Title 29 of
the Delaware Code. Video lottery operations in the State of Delaware are
strictly regulated by the Delaware State Lottery Office through the powers
delegated to the Director of the Lottery pursuant to Title 29 of the
Delaware Code.

2.0 Definitions

The following words shall be accorded these meanings for purposes of these
Regulations:

"Agency" - the Delaware State Lottery Office created pursuant to 29 Del. C.
chapter 48.

"agent" or "licensed agent" or "licensed video lottery agent" - any person
licensed by the Director of the Agency to conduct licensed video lottery
operations.

"applicant" - any person applying for a license authorized under these
regulations.

"background investigations" - the security, fitness, and background checks
conducted of an applicant.

"Director" - the Director of the Delaware State Lottery Office as
established by Title 29 of the Delaware Code.

"employee organization" - any organization that admits or seeks to admit to
membership employees of a Delaware video lottery agent and which has a
purpose the representation of such employees in collective bargaining,
grievance representation, labor disputes, salaries, wages, rates of pay,
hours of employment, or conditions of work.

"key employee" - any officer and any employee of an employee organization
who has direct involvement with or who exercises authority, discretion or
influence in the representation of employees of a Delaware video lottery
agent in collective bargaining, grievance representation, labor disputes,
salaries, wages, rates of pay, hours of employment or conditions of work.
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"licensee" - any person authorized by the Director to participate in video
lottery operations.

"Lottery" - the public gaming system or games established and operated by
the Delaware State Lottery Office.

"pension or welfare system maintained by an employee organization" - means
any pension or welfare system created or established by an employee
organization or one or more of the trustees or one or more members of the
governing body of which is selected or appointed by the employee
organization.

"pension system" - any plan, fund or program which is maintained by an
employee organization, or by an employee organization and an employer, to
the extent that by its express terms or as a result of surrounding
circumstances such plan, fund or program provides retirement income to
employees or results in a deferral of income by employees for periods
extending to the termination of covered employment or beyond, regardless of
the method of calculating the contributions made to the plan, the method of
calculating the benefits under the plan or the method of distributing
benefits from the plan.

"person" - an individual, general partnership, limited partnership,
corporation or other legal entity.

"registrant" - any employee organization or key employee applying for
registration under these regulations.

"welfare system" - any plan, fund or program which is maintained by an
employee organization or by an employee organization and an employer, to
the extent that such plan, fund or program was established or is maintained
for the purposes of providing for its participants, or their beneficiaries,
through the purchase of insurance or otherwise, medical, surgical, or
hospital care or benefits, or benefits in the event of sickness, accident,
disability, death, or unemployment, or vacation benefits, apprenticeship,
or other training programs, or day care centers, scholarship funds, or
prepaid legal services, or any other such benefit other than pension on
retirement or death, and insurance to provide such pensions.

"video lottery" - any lottery conducted with a video lottery machine or
linked video lottery machines with an aggregate progression prize or
prizes.

3.0 Registration of Employee Organizations

3.1 Any employee organization representing or seeking to represent
employees employed by a Delaware video lottery agent shall register with
the Director of the
Agency. An employee organization shall be required to file a registration
application with the Agency within ten (10) business days after it secures
a signed authorization card from any employee who is employed by a Delaware
video lottery agent. Any registration statement filed by an employee
organization after the signature of an authorization card but prior to the
employee organization's petition for election shall not be subject to
disclosure by the Agency to any video lottery agent.

3.2 The employee organization shall register with the Agency on
registration forms supplied by the Agency. Registration forms shall require
the employee organization to provide the following, without limitation:

(1) The name of the registrant as shown on its charter or in its
constitution;

(2) The current and former business addresses of the registrant, including
the address of any office where matters pertaining to employees of a video
lottery agent will be conducted;

(3) The names of all persons principally involved in the original creation
of the employee organization;

(4) The name and address of: (i) all affiliates which are either a parent
body or any superior organization with any right or ability to control,
supervise, discipline or set policy for this organization; (ii) all
affiliates which are chartered by the same parent body as this
organization; (iii) all affiliates which are governed by the same
constitution or bylaws.

(5) The nature of the actual or probable involvement of any affiliate which
represents or is seeking to represent employees who are employed by a video
lottery agent, or which is involved or seeking to be involved in the
control or direction of such representation.

(6) Information on any pension or welfare system maintained by the employee
organization that hold any direct financial interest in any video lottery
agent or technology provider.

(7) Disclosure of pension and welfare systems maintained by the employee
organization and the names and titles of each officer or agent responsible
for management of the pension or welfare system.

(8) With respect to all employee organization personnel:

(a) Full name, including any known alias or nickname;

(b) Designation of all key labor employees in the employee organization;

(c) Title or other designation in the employee organization;

(d) A brief description of the duties and activities of each individual;

(e) The business address and telephone
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number of each individual; and,

(f) Annual compensation including salary, allowances, and other direct or
indirect disbursements (including reimbursed expenses).

(9) Any other information the Director determines is needed to determine
the competence, honesty, and integrity of the applicant as required by
Title 29 of the Delaware Code.

(10) A written certification under oath in a form signed by the local
employee organization president and secretary-treasurer, and chief official
of the local employee organization if his title is other than president or
secretary-treasurer, that the information contained on the application is
complete and accurate.

(11) A statement whether the employee organization has ever been found by
any court or governmental agency to be unsuitable to represent employees
under a federal or state labor statute.

(12) A list of any litigation involving the employee organization over the
last five years.

(13) A Release Authorization directing all courts, probation departments,
selective service boards, employers, educational institutions, financial
and other institutions and all governmental agencies to release any and all
information pertaining to the registrant as requested by the Agency or the
Delaware State Police.

(14) A waiver of liability as to the State and its instrumentalities and
agents for any damages resulting to the registrant from any disclosure or
publication of information acquired during the investigation process.

3.3 To the extent, if any, that the information supplied in the
registration or otherwise supplied by the employee organization or on the
employee organization's behalf, becomes inaccurate or incomplete, the
employee organization shall so notify the Agency in writing as soon as it
is aware that the information is inaccurate or incomplete, and shall at
that time supply the information necessary to correct the inaccuracy or
incompleteness of the information.

3.4 Upon request of the Agency, the employee organization shall supplement
the information provided in the registration form as deemed necessary by
the Agency.

3.5 All registration statements filed under these Regulations shall be
valid for a one-year period and a renewed registration form or an updated
supplemental registration form must be filed annually. The employee
organization filing the registration form is under a continuing duty to
promptly notify the Director of the Agency of any changes in disclosed
information.

4.0 Registration of Key Employees of Employee
Organizations

4.1 Any key employee of an employee organization shall be required to
register with the Agency at the same time as the application for
registration is filed under section 3.0 of these Regulations, or within
thirty (30) days after the date on which such individual is elected,
appointed, or hired, whichever is later.

4.2 The key employee shall register with the Agency on registration forms
supplied by the Agency. Registration forms shall require the key employee
to provide the following, without limitation:

(1) Name, including any aliases or nicknames;

(2) Title or position with the employee organization;

(3) Date and place of birth;

(4) Physical description;

(5) Current address and residence history;

(6) Social security number;

(7) Citizenship and, if applicable, information concerning alien status;

(8) Telephone number at current place of employment;

(9) Employment history, including all positions held with a labor
organization, union or affiliate, whether or not compensated;

(10) Excluding minor traffic offenses, a detailed description of the
following areas of criminal conduct, if any, including whether the crime
involved is denominated a felony or a misdemeanor:

(i) Any convictions;

(ii) Any criminal offenses for which he was charged, indicted or summoned
to answer, but for which he was not convicted;

(iii) Any criminal offenses for which he received a pardon;

(11) Whether he has ever been denied a business, liquor, gaming, or
professional license, or has had such license revoked;

(12) Whether he has ever been found by any court or governmental agency to
be unsuitable to be affiliated with a labor organization and if so, all
details relating thereto;

(13) Whether he has ever been subpoenaed as a witness before any grand
jury, legislative body, administrative body, or crime commission and if so,
all details relating thereto.

(14) All key employee applicants will be required to submit a complete set
of fingerprints to the Delaware State Bureau of Identification along with
the standard release information.

(15) Any other information the Director
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determines is needed to determine the competence, honesty, and integrity of
the applicant as required by Title 29 of the Delaware Code.

(16) A written certification under oath by the applicant that the
information contained on the application is complete and accurate.

(17) A Release Authorization directing all courts, probation departments,
selective service boards, employers, educational institutions, financial
and other institutions and all governmental agencies to release any and all
information pertaining to the applicant as requested by the Agency or the
Delaware State Police.

(18) A waiver of liability as to the State and its instrumentalities and
agents for any damages resulting to the applicant from any disclosure or
publication of information acquired during the investigation process.

4.3 To the extent, if any, that the information supplied in the application
form, or otherwise supplied by the applicant, becomes inaccurate or
incomplete, the applicant shall so notify the Agency in writing as soon as
it is aware that the information is inaccurate or incomplete, and shall at
that time supply the information necessary to correct the inaccuracy or
incompleteness of the information.

4.4 Upon request of the Agency, the applicant shall supplement the
information provided in the application form as deemed necessary by the
Agency.

4.5 All registration forms filed under these Regulations shall be valid for
a one-year period and a renewed registration form or an updated
supplemental registration form must be filed annually. The entity or
individual filing such form is under a continuing duty to promptly notify
the Director of any changes in disclosed information.

5.0 Procedure for Review of Registration Applications

5.1 All registration statements filed under these Regulations shall be
valid for a one year period and a renewed registration must be filed
annually. The entity or individual filing such form is under a continuing
duty to promptly notify the Director of any changes in disclosed
information. The Delaware State Police shall conduct all background
investigations required for by these Regulations and 29 Del. C. section
4805(a)(24)(a).

5.2 All applications for registration shall be deemed approved unless the
Director notifies the applicant within sixty (60) days of his decision not
to approve the registration or unless extenuating circumstances require a
longer period, in which case the Director shall act with all deliberate
speed to complete the process.

5.3 The application for registration by an employee organization or key
employee of such employee organization may be denied or registration
revoked under the following circumstances:

(i) If the employee organization or key employee of such employee
organization is in violation of standards

established under the Labor Management Reporting and Disclosure Procedure
Prohibition Against Persons Holding Office, 29 U.S.C. section 504(a).

(ii) The applicant's competence, honesty or integrity pose a threat to the
public interest of the State or to the reputation of or effective
regulation and control of the video lottery based on the applicant's
associations or by virtue of the fact that the applicant has been convicted
of a felony crime of moral turpitude or arrested for an act constituting
racketeering under 11 Del. C. section 1502(9)(a)(b)(2)(4-10) within ten
(10) years prior to applying for registration hereunder or at anytime
thereafter. Any employee or employee organization denied registration based
on an arrest for an act constituting racketeering under 11 Del. C. section
1502(9)(a)(b)(2)(4-10) may apply for reconsideration of registration if
subsequently acquitted or a nolle prosequi is entered or the charge is
otherwise dismissed. In such instances, the Lottery shall reconsider the
applicant's registration based on the criteria set forth in these
Regulations and 29 Del. C. section 4805(a)(24).

(iii) The organization or individual has knowingly made or caused to be
made any written statement to any representative of the Agency or the
Delaware State Police or who has orally responded to an official inquiry by
the Agency, its employees or agents, which was at the time and in light of
circumstances under which it was made false or misleading.

(iv) The organization or key employee thereof holds or obtains a direct
financial interest in any video lottery agent, provided the employee
organization is provided a thirty (30) day period to divest of any such
direct financial interest.

5.4 Any employee organization may continue to provide services to employees
of a Delaware video lottery agent during the review of the application
process and the appeal process, except where the employee organization is
found in violation of section 5.3(iv) of these Regulations or there has
been a previous violation of sections 5.3(i-iii) of these Regulations by
the employee organization within the previous ten (10) years.

5.5 The failure of any key employee to satisfy the requirements of sections
5.3(i-iv) of these Regulations may constitute grounds for suspension of the
registration of
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the employee organization if the organization does not remove the key
employee from his or her duties as defined in 29 Del. C. section 4803(j)
and the definition of "key employee" contained in section 2.0 of these
Regulations. The employee organization will be given a reasonable
opportunity to remove or replace any key employee found to be in violation
of sections 5.3(i-iv) of these Regulations.

5.6 In any case where the Director determines that a registration of an
employee organization or key employee shall be denied or revoked, the
Agency shall first give written notice to the applicant or registrant of
the intended action, the reasons therefor, and the right to a hearing as
provided for in 29 Del. C. chapter 101. The notice of the intended denial,
suspension, or revocation shall comply with any applicable requirements of
the Delaware Administrative Procedures Act in 29 Del. C. sections
10133-10134 and, at a minimum, afford the applicant or registrant an
opportunity for a hearing.

5.7 If the applicant or registrant desires a hearing, it shall provide the
Agency with a written statement within ten days of receipt of the notice
which contains the following:

(1) A clear and concise assignment of each error which the applicant or
registrant alleges to have been committed in the tentative determination to
deny, suspend, or revoke the registration. Each assignment of error should
be listed in a separately numbered paragraph.

(2) A clear and concise statement of the facts on which the applicant or
registrant relies in support of each assignment of error.

(3) A prayer setting forth the relief sought.

(4) The signature of the individual or an officer of the employee
organization authorized to request the hearing.

(5) A verification by the person requesting the hearing or counsel that the
statements contained in the statement are true.

5.8 The Secretary of Finance shall, within a reasonable time, if requested
by the Director, appoint a hearing officer to determine whether the
application for registration should be denied, suspended, or revoked. The
appointed hearing officer shall be bound to conduct all hearings in
conformance with the requirements of 29 Del. C. section 10131. Notice of
the hearing shall be given at least twenty (20) days before the date it is
to be held.

5.9 The applicant or registrant may appear individually, by legal counsel,
or by any other duly authorized representative. In the absence of the
registrant, written evidence of a representative's authority shall be
presented to the hearing officer in a form satisfactory to
the hearing officer.

5.10 The applicant or registrant or his duly authorized representative, may
with the approval of a hearing officer waive the hearing and agree to
submit the case for decision on the record, with or without a written
brief. Such a waiver or agreement shall be in writing and placed on the
record.

5.11 The applicant or registrant shall be given an opportunity for argument
within the time limits fixed by the hearing officer following submission of
the evidence. The hearing officer, upon request of the licensee, may accept
briefs in lieu of argument. The briefs shall be filed within ten days after
the hearing date or within such other time as fixed by the hearing officer.

5.12 The Delaware Uniform Rules of Evidence shall be in effect in all
proceedings before the hearing officer. The hearing officer may exclude any
evidence which is irrelevant, unduly repetitious, or lacking a substantial
probative effect.

5.13 A record shall be made of all hearings and all witnesses shall be
sworn and subject to cross examination.

5.14 Following the conclusion of the hearing and within ten days of the
receipt of the transcript thereof, or within such other time as fixed by
the hearing officer but in no event later than 45 days following the
hearing, the hearing officer shall prepare a final decision, including his
or her findings of fact and conclusions of law, and the order signed by the
hearing officer shall be final. A copy of said order shall be served upon
the party requesting the hearing or their attorney of record in person or
by registered or certified mail.

5.15 The hearing officer's decision to deny an application of registration
or to suspend or revoke a registration shall be appealable to the Superior
Court under the provisions of the Delaware Administrative Procedures Act.

6.0 Lottery Employee Investigations

6.1 The Director shall conduct employment investigations for any person
seeking employment with the Agency for compensation for a position which
has direct access to lottery ticket sales agents, video lottery agents, or
vendors.

6.2 Applicants for Lottery positions in section 6.1 of these Regulations
will be required to submit a set of their fingerprints to the State Bureau
of Identification along with a signed standard release. The submitted
fingerprints shall
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be processed by the S.B.I. in order to provide the Director with the
individual's entire federal and state criminal history record.

6.3 Any applicant for a Lottery position in section 6.1 of these
Regulations shall be required to submit an application form to the Agency
to allow the Director to determine that the applicant does not pose a
threat to the public interest of the State of Delaware or the integrity of
the Lottery Office. The application materials shall request, without
limitation:

(1) Name, including any aliases or nicknames;

(2) Title or position to be applied for;

(3) Date and place of birth;

(4) Current address and residence history;

(5) Social security number;

(6) Citizenship and, if applicable, information concerning alien status;

(7) Telephone number;

(8) Employment and educational history.

(9) Qualifications for the position applied for;

(10) Excluding minor traffic offenses, a detailed description of the
following areas of criminal conduct, if any, including whether the crime is
denominated a felony or a misdemeanor:

(i) Any convictions;

(ii) Any criminal offenses for which the applicant was charged, indicted,
or summoned to answer, but for which he was not convicted;

(iii) Any criminal offense for which he received a pardon;

Any other information the Director determines is needed to determine the
qualifications and fitness of the applicant.

7.0 Severability

The sections and subsections of these rules and regulations shall be deemed
severable. Should any section or subsection be deemed by judicial opinion
or legislative enactment to be invalid, unconstitutional or in any manner
contrary to the laws of the State of Delaware, then such opinion or
enactment shall invalidate only that particular section or subsection of
these rules and regulations and all other sections shall remain in full
force and effect.

Department of Health &

Social Services

Division of Social Services/Medical Assistance Program (DMAP)

BEFORE THE DELAWARE DEPARTMENT OF HEALTH AND SOCIAL SERVICES

IN THE MATTER OF: )

)

REVISION OF THE REGULATIONS )

OF THE MEDICAID/MEDICAL )

ASSISTANCE PROGRAM )

NATURE OF THE PROCEEDINGS:

The Delaware Department of Health and Social Services ("Department")
initiated proceedings to update policies to increase the value of excluded
vehicles for long-term care Medicaid clients. The Department's proceedings
to amend its regulations were initiated pursuant to 29 Delaware Code
Section 10114 and its authority as prescribed by 31 Delaware Code Section
512.

The Department published its notice of proposed regulation changes pursuant
to 29 Delaware Code Section 10115 in the October 1997 Register of
Regulations, requiring written materials and suggestions from the public
concerning the proposed regulations to be produced by November 1, 1997, at
which time the Department would receive information, factual evidence and
public comment to the said proposed changes to the regulations.

No oral or written comments, information, or factual evidence were received
related to this proposed rule.

FINDINGS OF FACT:

The Department finds that the proposed changes as set forth in the October
Register of Regulations should be adopted as written.

THEREFORE, IT IS ORDERED, that the proposed regulations of the
Medicaid/Medical Assistance Program are adopted and shall be final
effective February 10, 1998.

January 13, 1998

Date of Signature

Gregg C. Sylvester, M.D.

Acting Secretary

GCS/EA/tgm

DMAP SECTION 410.15 (Page 3)

2. Vehicles
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Vehicles are defined as automobiles, boats, travel trailers, motorcycles
etc. The current market value of a vehicle is the average price that it
will sell for (based on year, make, model and condition) on the open market
in a certain geographic area. Current market value can be determined by
using the NADA book (trade in value) or a written appraisal from a
disinterested, knowledgeable source. One vehicle may be excluded under
Section 410.13. Only one vehicle may be excluded for a married couple.

If NO vehicle is excluded per 410.13, up to $4500 $4650 of the CMV of ONE
vehicle is excluded. If the CMV exceeds $4500 $4650, the excess counts as a
resource, unless the vehicle can be excluded under some other provision
(i.e., co-owner refuses to sell). It is unlikely the $4500 $4650 exclusion
will be used. This is because most vehicles are used for either a medical
problem or for essential daily activities and can be excluded per 410.13.

Any vehicle an individual owns in addition to the vehicle that was totally
or partly excluded (up to $4500 $4650), is a resource in the amount of its
equity value. The equity value is the CMV minus amount owed on the vehicle.
The exclusion is applied in the manner most advantageous to the individual.
If one of two vehicles can be excluded as necessary for medical treatment,
the exclusion is applied to the vehicle with the greater equity value
regardless of which vehicle is used to obtain medical treatment.

Comments or requests for copies of proposed changes or relevant materials
may be made in writing to: Medicaid Administrative Offices, Division of
Social Service, P.O. Box 906, New Castle, DE 19720, attention: Thelma G.
Mayer, or by calling (302) 577-4880, extension 131, or may be viewed at the
following locations: New Castle County: Medicaid Office, Lewis Bldg.,
Herman M. Holloway, Sr. Health & Social Services Campus, 1901 N. DuPont
Hwy., New Castle, DE, 19720; Kent County: Medicaid Unit, Division of Social
Services, Williams State Service Center, 805 River Rd., Dover, DE 19901;
Sussex County: Medicaid Unit, Division of Social Services, Georgetown State
Service Center, 546 S. Bedford St., Georgetown, DE, 19947.

Comments, written suggestions, compilations of data, testimony, briefs or
other written materials concerning the proposed change must be received by
mail no later than November 1, 1997, at the Medicaid Administrative Office,
Lewis Bldg., Herman M. Holloway, Sr. Health & Social Services Campus, 1901
N. DuPont Hwy., New Castle, DE 19720, attention Thelma Mayer. Materials
filed thereafter will not be considered except where good cause for
lateness is demonstrated.

Copies of all written submissions filed with the Medicaid office will be
available for public inspection in the Medicaid
Administrative Office at the address given above. Please call (302)
577-4904 for an appointment if you wish to review the materials.
Individuals with disabilities who wish to participate in these proceedings,
or review the materials submitted, should contact the Division to discuss
auxiliary aids or services needed to facilitate such review or
participation. Such contact may be in person, in writing or by telephone by
using the Telecommunications Relay Service, or otherwise.

Department of Health &

Social Services

BEFORE THE DELAWARE DEPARTMENT OF HEALTH AND SOCIAL SERVICES

IN THE MATTER OF: )

REVISION OF THE REGULATIONS )

OF THE MEDICAID/MEDICAL )

ASSISTANCE PROGRAM )

CONTAINED IN DMAP SECTION 420 )

NATURE OF THE PROCEEDINGS:

Delaware Health and Social Services published an emergency order in the
September 1997 Register of Regulations, page 214, related to the revision
of the regulation contained in DMAP SECTION 420 which increased the amount
of funds that can be protected monthly in a personal needs account for
individuals residing in nursing facilities. An increase of six dollars
(from $36 to $42) was approved and funded by the Delaware Legislature
effective July, 1, 1997.

FINDINGS OF FACT:

No oral or written comments, materials, or suggestions were received from
any individual or the public.

THEREFORE, IT IS ORDERED, that the proposed revision to the regulation be
adopted as written effective July 1, 1997.

December 11, 1997

Date of Signature

Gregg C. Sylvester, M.D.

Acting Secretary

GCS/EA/tgm

DMAP 420

1. Personal needs

(a) $36.00 $42.00 per month of available income
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is to be protected for the recipients direct personal needs, as defined by
Form MAP-64 *

BEFORE THE DELAWARE DEPARTMENT OF HEALTH AND SOCIAL SERVICES

IN THE MATTER OF: )

)

REVISION OF THE REGULATIONS )

OF THE MEDICAID/MEDICAL )

ASSISTANCE PROGRAM )

NATURE OF THE PROCEEDINGS:

The Delaware Department of Health and Social Services ("Department")
initiated proceedings to update policies in the Durable Medical Equipment
and Home Health Provider Manuals. The Department's proceedings to amend its
regulations were initiated pursuant to 29 Delaware Code Section 10114 and
its authority as prescribed by 31 Delaware Code Section 512.

The Department published its notice of proposed regulation changes pursuant
to 29 Delaware Code Section 10115 in the November 1997 Register of
Regulations, requiring written materials and suggestions from the public
concerning the proposed regulations to be produced by December 1, 1997, at
which time the Department would receive information, factual evidence and
public comment to the said proposed changes to the regulations.

No oral or written comments, information or factual evidence were received
related to these proposed rules.

FINDINGS OF FACT:

The Department finds that the proposed changes as set forth in the October
Register of Regulations should be adopted as written.

THEREFORE, IT IS ORDERED, that the proposed regulations of the
Medicaid/Medical Assistance Program are adopted and shall be final
effective February 10, 1998.

January 13, 1998

Date of Signature

Gregg C. Sylvester, M.D.

Acting Secretary

GCS/EA/tgm

DURABLE MEDICAL EQUIPMENT MANUAL

New policy added:

Osteogenesis Stimulators

The DMAP may cover use of a nonspinal electrical osteogenesis stimulator,
non-invasive (E0747), if the following criteria are met:

• Diagnosis must be non-union of a long bone fracture after six (6) or more
months have elapsed without healing of the fracture, or

• failed fusion of a joint other than in the spine where a minimum of nine
(9) months has elapsed since the last surgery, or

• congenital pseudarthrosis.

• In addition to the physician's letter of medical necessity, documentation
detailing history of diagnosis and previous treatment (e.g., operative
notes, x-ray reports, office notes), must accompany the CMN(Appendix B).

The DMAP may cover the use of a spinal electrical osteogenesis stimulator
(E0748) if the following criteria are met:

• Failed spinal fusion where a minimum of nine (9) months has elapsed since
the last surgery, or

• following a multi level spinal fusion surgery, or

• following spinal fusion surgery where there is a history of a previously
failed spinal fusion at the same site.

• In addition to the physician's letter of medical necessity, documentation
detailing history and previous treatment (e.g., operative notes, x-ray
reports, office notes), must accompany the CMN (Appendix B).

HOME HEALTH MANUAL

New wording added by Federal regulation

Home Health Agency (HHA) is a public or private agency or organization, or
part of an agency or organization, that meets the requirements for
participation in Medicare [and any additional standards legally promulgated
by the State that are not in conflict with Federal requirements.]

Comments or requests for copies of proposed changes or relevant materials
may be made in writing to: Medicaid Administrative Offices, Division of
Social Service, P.O. Box 906, New Castle, DE 19720, attention: Thelma G.
Mayer, or by calling (302) 577-4880, extension 131, or may be viewed at the
following locations: New Castle County: Medicaid Office, Lewis Bldg.,
Herman M. Holloway, Sr. Health &
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cerning the proposed regulations to be produced by November 1, 1997, at
which time the Department would receive information, factual evidence and
public comment to the said proposed changes to the regulations.

No oral or written comments, information or factual evidence were received
related to these proposed rules.

FINDINGS OF FACT:

The Department finds that the proposed changes as set forth in the October
Register of Regulations should be adopted as written.

THEREFORE, IT IS ORDERED, that the proposed regulations of the
Medicaid/Medical Assistance Program are adopted and shall be final
effective February 10, 1998.

January 13, 1998

Date of Signature

Gregg C. Sylvester, M.D.

Acting Secretary

GCS/EA/tgm

TO BE ADDED TO THE AMBULANCE PROVIDER SPECIFIC POLICY MANUAL

Criteria for Non-Emergency Ambulance Transportation for Medicaid Clients in
a Nursing Facility

The DMAP may cover non-emergency ambulance transportation for eligible
Medicaid clients in a nursing facility when the transport is to and/or from
a medical service (e.g., physician's office, clinic, dialysis center, or
other medical consultation), and if one of the following criteria is met:

• if facility transport is not available; or

• if the client is ambulatory but cannot be safely transported via normal
transport system (e.g., client is agitated, combative, or is otherwise
mentally compromised); or

• if the client requires more physical assistance than can be provided by
one facility attendant; or

• if the client has a physical or medical condition which contraindicates
normal van/car transport (e.g., client is morbidity obese, or has a
temporary condition that prevents ambulating); or

• if the client has another physical/medical condition which
contraindicates normal van/car transport (e.g., cardiac condition, severely
respiratory compromised, or requires assistance and transportation of
medical equipment such as a ventilator, oxygen, or IVs).

The medical necessity of each transport must be
Social Services Campus, 1901 N. DuPont Hwy., New Castle, DE, 19720; Kent
County: Medicaid Unit, Division of Social Services, Williams State Service
Center, 805 River Rd., Dover, DE 19901; Sussex County: Medicaid Unit,
Division of Social Services, Georgetown State Service Center, 546 S.
Bedford St., Georgetown, DE, 19947. Comments, written suggestions,
compilations of data, testimony, briefs or other written materials
concerning the proposed change must be received by mail no later than
December 1, 1997, at the Medicaid Administrative Office, Lewis Bldg.,
Herman M. Holloway, Sr. Health & Social Services Campus, 1901 N. DuPont
Hwy., New Castle, DE 19720, attention Thelma Mayer. Materials filed
thereafter will not be considered except where good cause for lateness is
demonstrated.

Copies of all written submissions filed with the Medicaid office will be
available for public inspection in the Medicaid Administrative Office at
the address given above. Please call (302) 577-4904 for an appointment if
you wish to review the materials. Individuals with disabilities who wish to
participate in these proceedings, or review the materials submitted, should
contact the Division to discuss auxiliary aids or services needed to
facilitate such review or participation. Such contact may be in person, in
writing or by telephone by using the Telecommunications Relay Service, or
otherwise.

Department of Health &

Social Services

BEFORE THE DELAWARE DEPARTMENT OF HEALTH AND SOCIAL SERVICES

IN THE MATTER OF: )

)

REVISION OF THE REGULATIONS )

OF THE MEDICAID/MEDICAL )

ASSISTANCE PROGRAM )

NATURE OF THE PROCEEDINGS:

The Delaware Department of Health and Social Services ("Department")
initiated proceedings to update policies in the Medicaid Inpatient Hospital
Provider Manual, Outpatient Hospital Provider Manual, Long-Term Care
Provider Manual and Ambulance Transportation Provider Manual. The
Department's proceedings to amend its regulations were initiated pursuant
to 29 Delaware Code Section 10114 and its authority as prescribed by 31
Delaware Code Section 512.

The Department published its notice of proposed regulation changes pursuant
to 29 Delaware Code Section 10115 in the October 1997 Register of
Regulations, requiring written materials and suggestions from the public
con
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documented on the claim being submitted to the DMAP for payment. The
required documentation consists of the following:

• the "from" place of transport;

• the "to" place of transport; and

• a detailed description of the patient's condition at the time of
transport. The ambulance provider must receive documentation from the
nursing facility that will verify which of the above criteria qualifies the
recipient for non-emergency ambulance transportation.

TO BE ADDED TO THE LONG-TERM CARE PROVIDER SPECIFIC POLICY MANUAL

Criteria for Non-Emergency Ambulance Transportation for Medicaid Clients in
a Nursing Facility

The DMAP may cover non-emergency ambulance transportation for eligible
Medicaid clients in a nursing facility when the transport is to and/or from
a medical service (e.g., physician's office, clinic, dialysis center, or
other medical consultation), and if one of the following criteria is met:

• if facility transport is not available; or

• if the client is ambulatory but cannot be safely transported via normal
transport system (e.g., client is agitated, combative, or is otherwise
mentally compromised); or

• if the client requires more physical assistance than can be provided by
one facility attendant; or

• if the client has a physical or medical condition which contraindicates
normal van/car transport (e.g., client is morbidity obese, or has a
temporary condition that prevents ambulating); or

• if the client has another physical/medical condition which
contraindicates normal van/car transport (e.g., cardiac condition, severely
respiratory compromised, or requires assistance and transportation of
medical equipment such as a ventilator, oxygen, or IVs).

The nursing facility is expected to transport Medicaid clients to and/or
from medical services if the facility has vehicle (s) utilized for patient
transportation.

It is the responsibility of the nursing facility to provide documentation
to the ambulance provider that will verify which of the above criteria
qualifies the recipient for non-emergency ambulance transportation.

TO BE ADDED TO THE LONG-TERM CARE PROVIDER SPECIFIC POLICY MANUAL

The facility must bill any third party payer which may be liable for
services provided. This billing must be done prior to billing the DMAP.

The facility must accept the DMAP payment as "payment in full" for services
provided.

DEPARTMENT OF LABOR

Division of Industrial Affairs

Statutory Authority: 29 Delaware Code,

Section 8503(7) (29 Del.C. §8503(7))

BEFORE THE DEPARTMENT OF LABOR

IN RE ) NATURE OF THE PROCEEDINGS

ADOPTION OF ) SUMMARY OF THE EVIDENCE

AMENDMENT ) FINDING OF FACT

TO ) CONCLUSIONS OF LAW

PROCEDURES ) DECISION TO WITHDRAW

OF THE EQUAL )

EMPLOYMENT )

REVIEW BOARD)

ORDER

Nature of the Proceedings

1. Pursuant to notice in accordance with 29 Del. C. § 10115, the Department
of Labor proposed an amendment to Section IV. 4.1 of the Procedures of the
Equal Employment Review Board.

2. A public hearing was held on Monday, November 25, 1997, in Conference
Room 049 of the Department of Labor Office Building, 4425 North Market
Street, Wilmington, Delaware, the time and place designated to receive
written and oral comments.

3. As designated by the Secretary of Labor, Darrell J. Minott, Karen
Peterson, Director of the Division of Industrial Affairs, was present to
receive testimony and evidence at the November 25, 1997 hearing in
Wilmington, Delaware.

Summary of the Evidence

4. Director Peterson noted for the record that the Department of Labor is
withdrawing the amendment at the request of the Equal Employment Review
Board.

There was no further testimony or evidence.

Findings of Fact

The Department of Labor recommends that the amendment be withdrawn.

Conclusions of Law
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5. The Department of Labor proposed the amendment to the Procedures of the
Equal Employment Review Board pursuant to its authority granted in 29 Del.
C. § 8503.

Decision To Withdraw

6. It is the decision and order of the Department of Labor

that the proposed amendment to the Equal Employment Review Board, a copy of
which is attached as Exhibit "A", is hereby WITHDRAWN.

SO ORDERED, this _______ day of _________, 1998.

Darrell J. Minott

Secretary of Labor

IV. HEARING PROCEDURES

4.1 Hearings generally

Add the sentence, "Any representation by counsel must be obtained privately
by the parties at their own expense." after sentence 3 of Regulation IV.
4.1. The new Regulation IV. 4.1 will read:

"Hearings generally - The Review Board is authorized to hear complaints
filed by the Department of Labor against an employer alleged to have
engaged in an unlawful employement practice. The purpose of the hearing is
to develop a full and complete factual record upon which the Review Board
may discharge its duties under 19 Del.C. § 712. Every party may appear with
or without counsel, except for corporations which must be represented by
counsel. [Any representation by counsel must be obtained privately by the
parties at their own expense.] Oaths shall be administered by a member of
the Review Board or the Deputy Attorney General, and documents or other
tangible evidence shall be presented to the Review Board and examined by
all parties."

DEPARTMENT OF LABOR

Division of Industrial Affairs

Statutory Authority: 29 Delaware Code,

Section 8503(7) (29 Del.C. §8503(7))

BEFORE THE DEPARTMENT OF LABOR

IN RE ) NATURE OF THE PROCEEDINGS

ADOPTION OF ) SUMMARY OF THE EVIDENCE

REGULATIONS ) FINDING OF FACT

REGARDING THE ) CONCLUSIONS OF LAW

IMPLEMENTATION) DECISION TO ADOPT

OF 19 DEL. C. §708,)

11 DEL.C. §§8563 )

and 8564 )

ORDER

Nature of the Proceedings

1. Pursuant to notice in accordance with 29 Del. C. § 10115, the Department
of Labor proposed Regulations to provide guidance to employers and
applicants regarding the implementation of

19 Del. C. § 708, 11 Del. C. §8563 and 11 Del. C. §8564.

2. A public hearing was held on Monday, November 25, 1997, in Conference
Room 049 of the Department of Labor Office Building, 4425 North Market
Street, Wilmington, Delaware, the time and place designated to receive
written and oral comments.

3. As designated by the Secretary of Labor, Darrell J. Minott, Karen
Peterson, Director of the Division of Industrial Affairs, was present to
receive testimony and evidence at the November 25, 1997 hearing in
Wilmington, Delaware.

Summary of the Evidence

Those individuals testifying at the November 25, 1997 hearing in
Wilmington, Delaware, and a summary of said testimony is as follows:

4. Mr. Joseph Letnaunchyn, President and Chief Executive Officer of the
Delaware Healthcare Association, provided general comments on the
regulatory process and comments on specific provisions of the regulations.
He offered the following suggestions:

Regulation II A. (SERVICE LETTER) which defines persons for whom the
service letter must be obtained should be changed. He stated that the
Regulation should be modified to indicate that service letters must be
obtained only for persons seeking employment in a health care facility or
child care facility that affords direct access to persons receiving care;

Regulation II A. (SERVICE LETTER) should be modified to specify the minimal
information which must be included in the reference letter for a person
seeking employment who was not previously employed or was self-employed.
Alternatively, Mr. Letnaunchyn proposed that the Regulation specify that,
"... the information contained in a reference letter should be considered
acceptable based on the judgment of the designated representative of the
health care provider or day care facility that receives, and relies on,
such reference letter.";

The Department of Labor should further clarify or define the term "good
faith" effort in Regulation III C. (1) (a);

Regulation IV. B. 1 regarding the method of contacting the Department of
Children, Youth and Their
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Families for the Child Abuse Registry Check is unclear and should contain
more specific information;

Regulation V. B. 1 regarding the method of contacting the Ombudsman's
Office for the Adult Abuse Registry Check is unclear and should contain
more specific information;

The Regulations should address the responsibilities of temporary agencies
that supply employees to health care providers and day care facilities;
and,

The Regulations should clarify that health care providers who operate any
type of school-based programs must comply with the State's hiring practices
and reporting requirements for educational facilities and are not required
to comply with the provisions of Titles 11 and 19, as specified in this
legislation.

Mr. Letnaunchyn submitted a written copy of his comments which was made a
part of the record by Director Peterson. A copy of his submission is
attached as Exhibit "A".

5. A written submission was received at the hearing from Pauline D. Koch,
Administrator, Office of Child Care Licensing. In her submission, Ms. Koch
requested that Regulation II. (DEFINITIONS) Section C. be changed from
"...the Department of Services for Children, Youth and their Families" to
"...the Department of Services for Children, Youth and Their Families." She
further requested that Regulation IV B. 1. b. be changed to, "The employer
must contact in writing the Department of Services for Children, Youth and
Their Families."

She further proposed that the title of the Department in Regulation IV. C.
and VI. B. 2 be changed from "...the Division of Children, Youth and Their
Families" to "...the Department of Services for Children, Youth and Their
Families". A copy of Ms. Koch's submission is included as Exhibit "B".

6. Prior to the hearing, a written submission was received from Robert
Stewart, Esquire, recommending changes to the text, such as underlining all
subheadings. Mr. Stewart also proposed adding the words " and fully
releasing the employer from liability for doing so" to Regulation II. C.
subsections 1. b. and 2.b.; Regulation IV. B. subsection 1. a. and 2. b.;
and Regulation V. B. subsection 1. a and 2. b. Mr. Stewart also suggested
numerous minor changes and additions to the wording of the Regulations. A
copy of Mr. Stewart's written submission is attached as Exhibit "C".

7. Director Peterson stated that the record would be held open for a period
of thirty (30) days following the hearing in order to receive further
written submissions. No further written submissions were received.

Findings of Fact

Recommendations were given to the Secretary of Labor
following the public hearing process and consideration of all oral
testimony and written documentation received. The Department of Labor's
findings regarding the issues raised at the hearing are as follows:

8. The Department of Labor will correct the numbering of the Regulations by
re-numbering Regulation II. ("SERVICE LETTER") as Regulation III.

9. The proposal that Regulation III. A. be amended for clarification is
accepted.. The word "person" will be changed to "person seeking employment
(as defined in Regulation I. A.)" in order to conform with the statute.

10. The proposal that Regulation III A. be changed to add the words "...
information contained in the letters of reference should be considered
acceptable based on the judgment of the designated representative of the
health care provider or day care facility that receives, and relies on,
such reference letter." is rejected. Authority for this language is not
contained within the statute.

11. The proposal that the last sentence of Regulation III C. 1. a. further
clarify methods by which employers can prove "good faith effort" is
accepted. The new last sentence will read, "In order to prove that the
service letter form has been sent, an employer may send the form by fax,
Certified Mail or other means which provides proof of mailing, faxing,
delivery or receipt."

12. The proposal to change Regulation IV. B. 1. and V. B. 1. is accepted
(in part) and rejected (in part).

Regulation IV. B. 1.c. will be changed to add the words "in writing".

The last sentence of Regulation V. A. will be changed to "The Adult Abuse
Registry check shall be performed by the Department of Health and Social
Services/Division of Services for Aging and Adults With Physical
Disabilities."

Regulation V. B. 1. b. will be changed to, "The employer must contact the
Department of Health and Social Services/Division of Services for Aging and
Adults With Physical Disabilities. The employer may contact that Division
by telephone."

The Department of Labor has no authority or jurisdiction to further define
the methods of contacting or receiving the Child Abuse Registry check or
the Adult Abuse Registry check.

13. The proposal to add language so that Regulation III. A. and IV. A.
conform with the statute regarding the responsibility of temporary agencies
to comply with these sections is accepted. In addition, the Department will
add the statutory language regarding temporary agencies to Regulation III.
C. 2. a.

14. The proposal that the Regulations clarify that health care providers
who operate any type of school-based programs comply with the State's
hiring practices and reporting requirements for educational facilities and
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are not required to comply with the provisions of Titles 11 and 19, as
specified in the legislation is rejected. Authority for this language is
not contained in the statutes.

15. The proposals of Pauline D. Koch, Administrator, Office of Child Care
Licensing are accepted. These changes involve corrections and a minor
clarification.

16. Mr. Stewart's proposal that the words "and fully releasing the employer
from liability from doing so" be added to Regulations II. C. subsections 1.
b.and 2.b.; Regulation IV B. subsection 1. a. and 2. b.; and Regulation V.
B. subsection 1. a and 2. b. is rejected. Authority for this language is
not contained in the statutes.

17. The proposal that the subheadings be underlined is accepted.

18. In addition to those changes stated above, the Department has made
other minor changes to the text to correct and/or clarify the Regulations
where necessary. These changes appear in Regulation III. C. 1. subsections
b. and e.; Regulation III. C. 2. subsection b.; Regulation III C. 3.
subsection a. and b.; Regulation VI. B. 2. and 3.; Regulation VI. C. 1.;
and Regulation VII. A. 3., 4. and 6.

19. The Department has changed the last sentence of Regulation IX. to
conform with the Administrative Procedures Act, specifically 29 Del. C.
§10118 (e). That section states, in part, that, "The effective date of an
order which adopts... a regulation shall be not less than 10 days from the
date the order adopting... a regulation has been published in its final
form in the Register of Regulations..." The last sentence of Regulation IX.
will state, "These regulations shall take effect ten (10) days after the
date of publication in the State's Register of Regulations."

Conclusions of Law

20. The Department of Labor proposed Regulations to provide guidance to
employers and applicants regarding the implementation of 19 Del. C. § 708,
11 Del. C. §§8563 and §8564 pursuant to its authority granted in 29 Del. C.
§ 8503.

Decision To Adopt

21. It is the decision and order of the Department of Labor

that the Regulations as amended by the above findings, a true and correct
copy of which are attached hereto as Exhibit "D", are hereby ADOPTED.

SO ORDERED, this _______ day of _________, 1998.

Darrell J. Minott

Secretary of Labor

DEPARTMENT OF LABOR

Division of Industrial Affairs

Statutory Authority: 29 Delaware Code,

Section 8503(7) (29 Del.C. §8503(7))

BEFORE THE DEPARTMENT OF LABOR

IN RE ) NATURE OF THE PROCEEDINGS

ADOPTION OF ) SUMMARY OF THE EVIDENCE

AMENDMENTS ) FINDING OF FACT

TO PREVAILING ) CONCLUSIONS OF LAW

WAGE REGULATIONS) DECISION TO ADOPT

ORDER

Nature of the Proceedings

1. Pursuant to notice in accordance with 29 Del. C. § 10115, the Department
of Labor proposed amendments to the Prevailing Wage Regulations. The
Prevailing Wage Regulations implement the provisions of Delaware's
Prevailing Wage Law, 29 Del. C. §6960, Prevailing wage requirements.

2. A public hearing was held on Monday, November 25, 1997, in Conference
Room 049 of the Department of Labor Office Building, 4425 North Market
Street, Wilmington, Delaware, the time and place designated to receive
written and oral comments.

3. As designated by the Secretary of Labor, Darrell J. Minott, Karen
Peterson, Director of the Division of Industrial Affairs, was present to
receive testimony and evidence at the November 25, 1997 hearing in
Wilmington, Delaware.

Summary of the Evidence

4. Director Peterson noted for the record that there was a typographical
error in amendment # 4. She stated that the second sentence of paragraph 6
c. should read, "The Heavy or Highway total will be divided by the Building
rate..."

Those individuals testifying at the November 25, 1997 hearing in
Wilmington, Delaware, and a summary of said testimony is as follows:

5. Mr. John Bonk, President of the Associated Builders and Contractors,
stated that the Associated Builders & Contractors strongly opposes
amendment # 5. He further stated that the record-keeping requirement
proposed in this amendment would be an unnecessary and repetitive burden on
contractors. He believes that the information is already required on the
sworn payroll reports. Mr. Bonk also stated that the three-year requirement
for maintaining the records required by amendment # 5 is a substantive
obligation and, because it is not currently in
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the prevailing wage law, the Secretary of Labor may not add substantive
obligations to the Regulations.

6. Linda Wilson, Deputy Attorney General, Department of Justice, stated
that she believes the statute does in fact, provide sufficient authority to
promulgate the requirement of amendment # 5. She further stated that
records reflecting all tasks performed on prevailing wage projects are
necessary. Ms. Wilson stated that she would agree that the first phrase of
the amendment could be deleted, but strongly recommends adoption of
amendment

# 5.

7. Director Peterson explained that both Delaware's Wage Payment &
Collection Act (19 Del. C. Chapter 11 ) and Minimum Wage Act (19 Del. C.
Chapter 9) contain a three-year record-keeping requirement and, therefore,
the three-year record-keeping requirement for prevailing wage records is
consistent with those laws.

8. Director Peterson noted for the record that written submissions had been
received from the following:

J.A. Moore & Sons Construction Company

County Insulation Co.

Roberts Construction Company

Casey Electric

Wohlsen Construction Company

Advanced Power Control, Inc.

Jacobi Contractors, Inc.

KrapfCanDoIt Co.

Each of the parties submitted letters expressing opposition to amendment #
5. The written submissions were made a part of the record and are attached
as Exhibit "A".

9. Director Peterson stated that the record would be held open for a period
of thirty (30) days following the hearing in order to receive further
written submissions. Written submissions opposing amendment # 5 were
received following the hearing from:

Tighe, Cottrell & Logan

Jacobi Contractors

Enterprise Masonry Corporation

Wanex Electrical Services, Inc.

Brandywine Nurseries

Minker Construction

DelCollo Electric, Inc.

Stephen Cole Contracting, Inc.

Casey Electric

Wohlsen Construction Company

Paul A. Nickle, Inc.

Roberts Construction Company

Square One Electrical Construction Company, Inc.

J.W. Walker & Sons, Inc.

Taylor Kline

Advance Construction Company of Delaware

Metal Sales & Service, Inc.

A & H Metals, Inc.

Bruce Industrial Company, Inc.

Pace Electric, Inc.

C & D Contractors, Inc.

M. Davis & Sons, Inc.

J.F. Sobieski Mechanical Contractor, Inc.

Technivate

George Sherman Corporation

DiSabatino Construction Company

Spacecon, Inc.

N.C. Builders, Inc.

Best Drywall

Daniel D. Rappa, Inc.

Bartley & Devary Electric, Inc.

J.P. Lazorick Company, Inc.

Conectiv Services

Tri-State The Roofers

All of the letters state that the requirements of proposed amendment # 5
are "burdensome and repetitive". These written submissions are included as
Exhibit "B".

Findings of Fact

Recommendations were given to the Secretary of Labor following the public
hearing process and consideration of all oral testimony and written
documentation received. The Department of Labor's findings regarding the
issues raised at the hearing are as follows:

10. There was no testimony on or opposition to amendment # 1, amendment #
2, amendment # 3 and amendment # 4.

11. Based upon the oral testimony and written submissions from the hearing,
the Department of Labor wishes to modify the wording of amendment # 5 to
read as follows:

"c. A daily log for each individual employed upon the site of construction.
The log must list (in general terms) the tasks performed by each employee
and the amount of time spent performing each task. (examples, "hung
drywall", "wired lighting fixtures", etc.)"

Conclusions of Law

12. The Department of Labor proposed the amendments to the Prevailing Wage
Regulations pursuant to its authority granted in 29 Del. C. § 8503.

Decision To Adopt

13. It is the decision and order of the Department of Labor that proposed
amendments # 1, # 2, # 3 and # 4 (as corrected) to the Prevailing Wage
Regulations, true and correct copies of which are attached hereto as
Exhibit "C", are hereby ADOPTED.

Decision to Adopt
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14. It is the decision and order of the Department of Labor that proposed
amendment # 5, as modified by the Department of Labor, a true and correct
copy of which is attached as Exhibit "D", is hereby ADOPTED.

SO ORDERED, this _______ day of _________, 1998.

Darrell J. Minott

Secretary of Labor

DEPARTMENT OF NATURAL RESOURCES & ENVIRONMENTAL CONTROL

Air Quality Management Section

Statutory Authority: 7 Delaware Code,

Chapter 60, (7 Del.C. Ch. 60)

Secretary's Order No. 97-A-0044__

Re: Regulation No. 37 ("NOx Budget Program") of the

Delaware Regulations Governing the Control of Air Pollution

Date of Issuance: December 29, 1997

Effective Date of Regulatory Changes: February 11, 1998

I. Background

On December 8, 1997, a public hearing was held to receive comments on a
proposed new Regulation No. 37, which establishes a NOx Budget Program for
Delaware. This regulation is necessary to implement a September 27, 1994
MOU among 11 states and the District of Columbia which constitute the Ozone
Transport Region. In an effort to reduce summertime ozone concentrations,
these states have committed to a regional program to cap NOx emissions and
encourage trading of emissions allowances on a regional basis in order to
substantially reduce NOx emissions and corresponding ozone levels. Each
state was assigned a NOx budget based on 1990 emission levels after
extensive consultations among regulatory agencies and affected sources
throughout the region. A model rule was developed as of May 1, 1996, which
then formed the basis for this rulemaking. Proper notice of the hearing was
provided as required by law. In addition, considerable efforts were made in
the two months leading up to this hearing to alert all potentially affected
sources of the requirements in this proposed program, which has not changed
since the 1994 MOU in terms of NOx reductions, deadlines or the 1990
baseline.

Following the hearing on December 8, the record was left
open for three days to receive additional comments from the regulated
community. Thereafter, AQM prepared a detailed response document in draft
form which was submitted to the Hearing Officer on December 17, 1997, in an
effort to expedite review of this matter. A final version of that response
document was received on December 19, 1997, with no substantive changes
from the draft, but with corrections of typographical errors, etc., and
formal approval of Division Management.

This regulation will affect fossil fuel fired boilers or indirect heat
exchangers with a max. rated heat input capacity equal to or greater than
250 MMBTU/hr; and all electric generating units with a rated output equal
to or greater than 15MW.

II. Findings

1. Proper notice of the hearing was provided as required by law.

2. The AQM Response Document, dated December 18, 1997, and submitted on
December 19, 1997, contains an accurate summary of comments in the record
along with reasoned responses and sound recommendations for action by the
Secretary on proposed Regulation No. 37. While many of the comments from
affected sources have some merit, nevertheless AQM's Response Document
provides a legally defensible record for this rulemaking.

3. A Hearing Officer's Report, dated December 22, 1997, which incorporates
the Response Document by reference, recommends promulgation of Regulation
37 after appropriate amendments are made, consistent with AQM's Response
Document.

4. The changes to be made as referenced in item 3 above, are not
substantial and thus the agency does not need to repropose the regulation
change.

5. While supporting AQM's positions on all substantive issues raised by
this rulemaking, nevertheless, the Hearing Officer suggested additional
consultation with Department of Justice attorneys regarding the burden of
proof imposed on affected sources under §18.b of the proposed regulation
before any enforcement action is undertaken.

III. Order

In view of the above findings, it is hereby ordered that the proposed
Regulation No. 37 of the Delaware Regulations Governing the Control of Air
Pollution be amended to reflect those changes specified in AQM's Response
Document and that the regulation be promulgated in accordance with the
customary process as required by law. It is understood that the provisions
of § 18.b will not be enforced until such time as further legal review has
been completed and necessary changes are made in that provision, if needed,
to comply with due process requirements.
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V. Reasons

This Regulation is based on a long-standing MOU and Model Rule developed
over several years in close coordination with all regulatory agencies and
affected sources within the State Ozone Transport Region. Its provisions,
therefore, come as no surprise to the parties involved and are necessary to
address serious concerns about ground-level ozone in Delaware and
throughout the region, in furtherance of the policies and purposes of 7
Del. C. Chapter 60.

Signed: Christophe A.G. Tulou

Christophe A. G. Tulou, Secretary

NOx Budget Program

Regulation No. 37

December 18, 1997

Section 1 - General Provisions

a. The purpose of this regulation is to implement Delaware's portion of the
Ozone Transport Commission's (OTC) September 27, 1994 Memorandum of
Understanding (MOU) by establishing in the State of Delaware a NOx Budget
Program.

b. A NOx allowance is an authorization to emit NOx, valid only for the
purposes of meeting the requirements of this regulation.

1. All applicable state and federal requirements remain applicable.

2. A NOx allowance does not constitute a security or other form of
property.

c. On or after May 1, 1999, the owner or operator of each budget source
shall, not later than December 31 of each calendar year, hold a quantity of
NOx allowances in the budget source's current year NATS account that is
equal to or greater than the total NOx emitted from that budget source
during the period May 1 through September 30 of the subject year.

d. Allowance transfers between budget sources sharing a common owner or
operator and/or authorized account representative are subject to all
applicable requirements of this regulation, including the allowance
transfer requirements identified in Section 11 of this regulation.

e. Offsets required for new or modified sources subject to non-attainment
new source review must be obtained in accordance with Regulation 25 of
Delaware's "Regulations Governing the Control of Air Pollution" and Section
173 of the Clean Air Act. Allowances are not considered offsets within the
context of this regulation.

f. Nothing in this regulation shall be construed to limit the authority of
the Department to condition, limit, suspend, or terminate any allowances or
authorization to emit.

g. The Department shall maintain an up to date listing of the NOx sources
subject to this regulation.

1. The listing shall identify the name of each NOx budget source and its
annual allowance allocation, if any.

2. The Department shall submit a copy of the listing to the NATS
Administrator by January 1 of each year, commencing in 1999.

Section 2 - Applicability

a. The NOx Budget Program applies to any owner or operator of a budget
source where that source is located in the State of Delaware.

b. Any person who owns, operates, leases, or controls a stationary NOx
source in Delaware not subject to this program, by definition, may choose
to opt into the NOx Budget Program in accordance with the requirements of
Section 8 of this regulation. Upon approval of the opt-in application by
the Department, the person shall be subject to all terms and conditions of
this regulation.

c. A general account may be established in accordance with Section 7 of
this regulation. The person responsible for the general account shall be
responsible for meeting the requirements for an Authorized Account
Representative and applicable account maintenance fees.

Section 3 - Definitions

For the purposes of this regulation, the following definitions apply. All
terms not defined herein shall have the meaning given them in the Clean Air
Act and Regulation 1 of the State of Delaware "Regulations Governing the
Control of Air Pollution".

a. Account means the place in the NOx Allowance Tracking System where
allowances held by a budget source (compliance account), or allowances held
by any person (general account), are recorded.

b. Account number means the identification number assigned by the NOx
Allowance Tracking System (NATS) Administrator to a compliance or general
account pursuant to Section 10 of this regulation.

c. Administrator means the Administrator of the U.S. EPA. The Administrator
of the U.S. EPA or his designee(s) shall manage and operate the NOx
Allowance Tracking System
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and the NOx Emissions Tracking System.

d. Allocate or Allocation means the assignment of allowances to a budget
source through this regulation; and as recorded by the Administrator in a
NOx Allowance Tracking System compliance account.

e. Allowance means the limited authorization to emit one ton of NOx during
a specified control period, or any control period thereafter subject to the
terms and conditions for use of banked allowance as defined by this
regulation. All allowances shall be allocated, transferred, or used as
whole allowances. To determine the number of whole allowances, the number
of allowances shall be rounded down for decimals less than 0.50 and rounded
up for decimals of 0.50 or greater.

f. Allowance deduction means the withdrawal of allowances for permanent
retirement by the NATS Administrator from a NOx Allowance Tracking System
account pursuant to Section 16 of this regulation.

g. Allowance transfer means the conveyance to another account of one or
more allowances from one [person] [account] to another by whatever means,
including but not limited to purchase, trade, auction, or gift in
accordance with the procedures established in Section 11 of this
regulation, effected by the submission of an allowance transfer request to
the NATS Administrator.

h. Alternative monitoring system means a system or component of a system,
designed to provide direct or indirect data of mass emissions per time
period, pollutant concentrations, or volumetric flow as provided for in
Section 13 of this regulation.

i. Authorized Account Representative (AAR) means the responsible person who
is authorized, in writing, to transfer and otherwise manage allowances as
well as certify reports to the NATS and the NETS.

j. Banked Allowance means an allowance which is not used to reconcile
emissions in the designated year of allocation but which is carried forward
into the next year and flagged in the compliance or general account as
"banked".

k. Banking means the retention of unused allowances from one control period
for use in a future control period.

l. Baseline means, except for the purposes of Section 12(d) (Early
Reductions) of this regulation, the NOx emission inventory approved by the
Ozone Transport Commission on June 13, 1995, and revised thereafter, as the
official 1990
baseline emissions of May 1 through September 30 for purposes of the NOx
Budget Program.

m. Boiler means a unit which combusts fossil fuel to produce steam or to
heat water, or any other heat transfer medium.

n. Budget or Emission Budget means the numerical result in tons per control
period of NOx emissions which results from the application of the emission
reduction requirement of the OTC MOU dated September 27, 1994, and which is
the maximum amount of NOx emissions which may be released from the budget
sources collectively during a given control period.

o. Budget source means a fossil fuel fired boiler or indirect heat
exchanger with a maximum heat input capacity of 250 MMBTU/Hour, or more;
and all electric generating units with a generator nameplate capacity of 15
MW, or greater. (Although not a budget source by definition, any person who
applies to opt into the NOx Budget Program shall be considered a budget
source and subject to applicable program requirements upon approval of the
application for opt-in.)

p. Clean Air Act means the federal Clean Air Act (42 U.S.C. 7401- 7626).

q. Compliance account means the account for a particular budget source in
the NOx Allowance Tracking System, in which are held current and/or future
year allowances.

r. Continuous Emissions Monitoring System (CEMS) means the equipment
required by this regulation used to sample, analyze, and measure which will
provide a permanent record of emissions expressed in pounds per million
British Thermal Units (Btu) and tons per day. The following systems are
component parts included in a continuous emissions monitoring system:
nitrogen oxides pollutant concentration monitor, diluent gas monitor
(oxygen or carbon dioxide), a data acquisition and handling system, and
flow monitoring systems (where appropriate).

s. Control period means the period beginning May 1 of each year and ending
on September 30 of the same year, inclusive.

t. Current year means the calendar year in which the action takes place or
for which an allocation is designated. For example, an allowance allocated
for use in 1999 which goes unused and becomes a banked allowance on January
1, 2000 can be used in the "Current Year" 2000 subject to the conditions
for banked allowance use as stated in this regulation.
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u. Early Reduction Allowance means an allowance credited for a NOx emission
reduction achieved during the control periods of either 1997 or 1998, or
both.

v. Electric generating unit means any fossil fuel fired combustion unit
which provides electricity for sale or use.

w. Excess emissions means emissions of nitrogen oxides reported by a budget
source during a particular control period, rounded to the nearest whole
ton, which is greater than the number of allowances which are available in
that budget source's NOx Allowance Tracking System compliance account on
December 31 of the calendar year for the subject NOx control season. For
the purpose of determining whole tons on excess emissions, the number of
tons of excess emissions shall be rounded down for decimals less than 0.50
and rounded up for decimals of 0.50 or greater.

x. Existing budget source means a budget source that operated at any time
during the period beginning May 1, 1990 through September 30, 1990.

y. Fossil fuel means natural gas, petroleum, coal or any form of solid,
liquid or gaseous fuel derived wholly, or in part, from such material.[This
definition does not include CO derived from any source.]

z. Fossil fuel fired means the combustion of fossil fuel or any derivative
of fossil fuel alone, or, if in combination with any other fuel, where
fossil fuel comprises 51% or greater of the annual heat input on a BTU
basis.

aa. General Account means an account in the NATS that is not a compliance
account.

bb. Heat input means heat derived from the combustion of any fuel in a
budget source. Heat input does not include the heat derived from preheated
combustion air, recirculated flue gas, or exhaust from other sources.

cc. Indirect heat exchanger means combustion equipment in which the flame
and/or products of combustion are separated from any contact with the
principal material in the process by metallic or refractory walls, which
includes, but is not limited to, steam boilers, vaporizers, melting pots,
heat exchangers, column reboilers, fractioning column feed preheaters,
reactor feed preheaters, and fuel-fired reactors such as steam hydrocarbon
reformer heaters and pyrolysis heaters.

dd. Maximum heat input capacity means the ability of a budget source to
combust a stated maximum amount of
fuel on a steady state basis, as determined by the greater of the physical
design rating or the actual maximum operating capacity of the budget
source. Maximum heat input capacity is expressed in millions of British
Thermal Units (MMBTU) per unit of time which is the product of the gross
caloric value of the fuel (expressed in MMBTU/pound) multiplied by the fuel
feed rate in the combustion device (expressed in pounds of fuel/time).

ee. Nameplate capacity means the maximum electrical generating output that
a generator can sustain when not restricted by seasonal or other deratings.

ff. New budget source means a NOx source that is a budget source, by
definition, that did not operate between May 1, 1990 and September 30,
1990, inclusive. A NOx source, that is a budget source by definition, that
was constructed prior to or during the period May 1, 1990 through September
30, 1990, but did not operate during the period May 1, 1990 through
September 30, 1990, shall be treated as a new budget source.

gg. NOx Allowance Tracking System (NATS) means the computerized system
established and used by the Administrator to track the number of allowances
held and used by any person.

hh. NOx Emissions Tracking System (NETS) means the computerized system
established and used by the Administrator to track and provide a permanent
record of NOx emissions from each budget source.

ii. Non-Part 75 Budget Source means any budget source not subject to the
requirements for emissions monitoring adopted pursuant to Regulation 36 of
the State of Delaware "Regulations Governing the Control of Air Pollution".

jj. Off budget means not subject to this regulation.

kk. Off budget source means any source of NOx emissions that is not
included in the NOx Budget Program as either a budget source, by
definition, or as an opt in source.

ll. Opt in means to choose to voluntarily participate in the NOx Budget
Program, and comply with the terms and conditions of this regulation.

mm. Opt-in-baseline means the Department approved heat input and/or NOx
emissions for use as a basis for allowance allocation and deduction.

nn. OTC means the Ozone Transport Commission.

oo. OTC MOU means the Memorandum of Understanding
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that was signed by representatives of eleven states and the District of
Columbia on September 27, 1994.

pp. OTR means the Ozone Transport Region as designated by Section 184(a) of
the Clean Air Act.

qq. Owner or Operator means any person who is an owner or who operates,
controls or supervises a budget source and shall include, but not be
limited to, any holding company, utility system or plant manager of a
budget source.

rr. Quantifiable means a reliable and replicable basis for calculating the
amount of an emission reduction that is acceptable to both the Department
and to the Administrator of the U.S.EPA.

ss. Part 75 Budget Source means any budget source subject to the
requirements for emissions monitoring adopted pursuant to Regulation 36 of
the State of Delaware "Regulations Governing the Control of Air Pollution".

tt. Real means a reduction in the rate of emissions, quantified
retrospectively, net of any consequential increase in actual emissions due
to shifting demand.

uu. Recorded with regard to an allowance transfer or deduction means that
an account in the NATS has been updated by the Administrator with the
particulars of an allowance transfer or deduction.

vv. Regional NOx budget means the maximum amount of NOx emissions which may
be released from all budget sources, collectively throughout the OTR,
during a given control period.

ww. Repowering, for the purpose of early reduction credit means either: 1)
Qualifying Repowering Technology as defined by 40 CFR, Part 72 or; 2) the
replacement of a budget source by either a new combustion source or the
purchase of heat or power from the owner of a new combustion source,
provided that: a) The replacement source (regardless of owner) is on the
same, or contiguous property as the budget source being replaced; b) The
replacement source has a maximum heat output rate that is equal to or
greater than the maximum heat output rate of the budget source being
replaced; or, c) The replacement source has a power output rate that is
equal to or greater than the power output rate of the combustion source
being replaced; and d) The replacement source incorporates technology
capable of controlling multiple combustion pollutants simultaneously with
improved fuel efficiency and with significantly greater waste reduction
relative to the performance of technology in widespread commercial
use as of November 15, 1990.

xx. Submitted means sent to the appropriate authority under the signature
of the authorized account representative or alternate authorized account
representative. An official U.S. Postal Service postmark, or electronic
time stamp, shall establish the date of submittal.

yy. Surplus means that, at the time the reduction was made, the emission
reduction was not required by Delaware's SIP, was not relied upon in an
applicable attainment demonstration, was not required by state or federal
permit or order, and was made enforceable in a permit that was issued after
the date of the OTC MOU (September 27, 1994).

zz. Use means, for purposes of emission reductions moved off budget, that
approval of the Department has been obtained to apply the emission
reduction at a source.

Section 4 - Allowance Allocation

a. This program establishes NOx emission allowances for each NOx control
period beginning May 1, 1999 through the NOx control period ending
September 30, 2002. Allowance allocation levels for each of these annual
NOx control periods are based on actual May 1, 1990 to September 30, 1990
actual NOx mass emissions.

b. The NOx Budget Program does not establish NOx emission allowances for
any NOx control period subsequent to the year 2002 NOx control period. NOx
emission allowances for each NOx control period subsequent to the year 2002
NOx control period will be established through amendment of this
regulation.

c. NOx allowance allocations to budget sources may be made only by the
Department in accordance with Section 4, Section 8, and Section 12 of this
regulation.

d. Appendix A of this regulation identifies the budget sources and
identifies the number of allowances each budget source is allocated.
Allowance allocations to each of the budget sources was determined as
follows:

1. Unless otherwise noted in Appendix A of this regulation, the document
EPA-454/R-95-013, "1990 OTC NOx Baseline Emission Inventory" served as the
basis for determination of the number of OTC MOU Allowances allocated to
each existing budget source.

i. Each existing budget source's OTC MOU Allowance allocation for NOx
control periods during the period May 1, 1999 to September 30, 2002,
inclusive, was identified in the referenced document, Appendix B, Final OTC
NOx Baseline Inventory, Delaware, Point-Segment Level Data,
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Phase II Target (Point Level).

ii. The identified values were rounded to the nearest whole allowance by
rounding down for allowances less than 0.5 and rounding up for decimals of
0.5 or greater.

2. Exceptional Circumstances Allowances, as granted by the OTC and as
identified in the document EPA-454/R-

95-013, "1990 OTC NOx Baseline Emission Inventory" for the existing budget
sources, are identified in Appendix A. These Exceptional Circumstance
Allowances were adjusted for the appropriate NOx emission rate reduction
requirement prior to inclusion in Appendix A.

3. The OTC allocated to the state of Delaware an additional 86 allowances,
referred to as reserve allowances, prior to application of NOx emission
rate reduction requirements, as its share of a total 10,000 ton reserve.
Application of OTC required emission reductions resulted in a total of 35
Reserve Allowances available for distribution, as identified in the
document EPA-454/R-95-013, "1990 OTC NOx Baseline Emission Inventory".

i. Each of the 28 existing budget sources identified in Appendix A as the
existing budget sources were allocated one (1) reserve allowance.

ii. One (1) additional reserve allowance was allocated to each of the four
organizations with existing budget sources. The additional reserve
allowance for each of the four organizations was added to the respective
existing budget source with the greatest heat input rating.

iii. The remaining three (3) reserve allowances shall be held by the
Department unused for the NOx control periods between May 1, 1999 and
September 30, 2002.

iv. Reserve Allowances are applicable only for the NOx control periods
during the period May 1, 1999 to September 30, 2002, inclusive. Reserve
Allowances do not exist for NOx control periods subsequent to the year
2002.

4. The final NOx allowance allocation for each of the 28 existing budget
sources, for each of the NOx control periods during the period of May 1,
1999 and September 30, 2002, is the sum of the values determined in
Sections 4(d)(1) - (3) and is identified in Appendix A. For the existing
budget sources that were not identified in the document "1990 OTC NOx
Baseline Emissions Inventory", the final allowance allocation includes an
allowance allocation determined in accordance with the procedures
identified in Section 4(f)(2)(i) - (ii) of this regulation.

5. Known operating NOx sources, that are budget sources by definition, that
did not operate in the May 1, 1990 to September 30, 1990 period are
identified in Appendix A with a final allowance allocation of zero (0)
allowances.

e. Budget sources that receive a NOx emission allowance allocation and
subsequently cease to operate shall continue to receive allowances for each
control period unless the allowances are reduced under Section 4(g) of this
regulation or a request to reallocate allowances has
been approved in accordance with Section 11 of this regulation.

f. Any NOx source, that is a budget source by definition, and that is not
included in Attachment A of this regulation and which operated at any time
between May 1, 1990 and September 30, 1990, inclusive, shall comply with
the requirements of this regulation prior to operating in any NOx control
period.

1. The owner or operator shall submit to the Department an application
including, as a minimum, the following information:

i. Identification of the source by plant name, address, and plant
combustion unit number or equipment identification number.

ii. The name, address, telephone and facsimile number of the authorized
account representative and, if desired, of an alternative authorized
account representative.

iii. A list of the owners and operators of the source.

iv. A description of the source, including fuel type(s), maximum rated heat
input capacity and electrical output rating where applicable.

v. Documentation of the May 1, 1990 - September 30, 1990 mass emissions (in
tons), including:

A. Quantification of the mass emissions (in tons).

B. A description of the method used to determine the NOx emissions.

C. Under no circumstances shall the emissions exceed any applicable federal
or state emission limit.

vi. Documentation of the May 1, 1990 - September 30, 1990 heat input (in
MMBTU), including:

A. Quantification of the heat input (in MMBTU/hr).

B. A description of the method used to determine the heat input.

C. The heat input shall be consistent with the baseline control period NOx
mass emissions determined in Section 4(f)(1)(v) of this regulation.

vii. Determination of the May 1, 1990 - September 30, 1990 NOx emission
rate, consistent with the guidelines of the "Procedures for Development of
the OTC NOx Baseline Emission Inventory", using the mass emissions
identified in Section 4(f)(1)(v) of this regulation and the heat input
identified in Section 4(f)(1)(vi) of this regulation.

. viii. An emission monitoring plan in accordance with Section 13 of this
regulation.

ix. A statement that the submitted information is representative of the
true emissions during the May 1, 1990 - September 30, 1990 and that the
source was operated in accordance with all applicable requirements during
that time.

x. The following statement: "I am authorized to make this submission on
behalf of the owners and operators of the budget source for which this
submission is made. I
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certify under penalty of law that I have personally examined, and am
familiar with, the statements and information submitted in this document
and all its attachments. Based on my inquiry of those individuals with
primary responsibility for obtaining the information, I certify that the
statements and information are to the best of my knowledge and belief true,
accurate, and complete. I am aware that there are significant penalties for
submitting false statements and information or omitting required statements
and information, including the possibility of fine or imprisonment."

xi. Signature of the authorized account representative or alternate
authorized account representative and date of signature.

2. For sources that notify the Department that they are subject to this
regulation within six months of the effective date of this regulation, the
Department shall allocate NOx emissions allowances to the source as
follows:

i. For fossil fuel fired boilers and indirect heat exchangers with a
maximum heat input capacity of 250 MMBTU/hr or more, allowance allocations
shall be determined as follows:

A. For sources located in New Castle and Kent counties, allowance
allocations shall be based on the more stringent of the following:

1. The less stringent of:

a. The actual May 1, 1990 to September 30, 1990 mass emissions reduced by
65%; or,

b. The mass emissions resulting from the multiplication of the actual May
1, 1990 to September 30, 1990 heat input by a NOx emissions rate of 0.20
lb/MMBTU.

2. If an approved RACT emissions limit results in emissions that are lower
than the less stringent of the limits calculated in Sections
4(f)(2)(i)(A)(1)(i) and 4(f)(2)(i)(A)(1)(ii), then the RACT value shall be
the emissions limit for the NOx Budget Program.

B. For sources located in Sussex county, allowance allocations shall be
based on the more stringent of the following:

1. The less stringent of:

a. The actual May 1, 1990 to September 30, 1990 mass emissions reduced by
55%; or,

b. The mass emissions resulting from the multiplication of the actual May
1, 1990 to September 30, 1990 heat input by a NOx emissions rate of 0.20
lb/MMBTU.

2. If an approved RACT emissions limit results in emissions that are lower
than the less stringent of the limits calculated in Sections
4(f)(2)(i)(B)(1)(i) and 4(f)(2)(i)(B)(1)(ii), then the RACT value shall be
the emissions limit for the NOx Budget Program.

ii. For electric generating units with a rated output of 15 MW or more that
is not affected by Section 4(f)(2)(i) of this regulation, allowance
allocations shall equal the more stringent of the May 1, 1990 to September
30, 1990 actual
emissions or that derived from the application of an approved RACT limit to
the actual May 1, 1990 to September 30 heat input value.

3. Within 60 days of receipt of the submittal, the Department shall review
the submittal and take the following actions:

i. If the Department does not approve the submittal, the authorized account
representative identified in the submittal shall be notified in writing of
the finding and the reason(s) for the finding.

ii. If the Department approves the submittal, the Department shall:

A. Notify in writing the authorized account representative identified in
the submittal.

B. The Department shall notify the OTC of the allowance allocation and
authorize the NATS Administrator to open a compliance account for the
subject source.

4. Any subject source that does not notify the Department within six months
of the effective date of this regulation or that can not quantify its May
1, 1990 - September 30, 1990 emissions rate or heat input shall be treated
as a new budget source in accordance with Section 9 of this regulation.

5. Compliance with Section 4(f) of this regulation does not imply
compliance nor sanction noncompliance with this regulation for prior NOx
control period operation.

g. If, after the effective date of this regulation, a budget source reduces
control period emissions and said emission reductions are to be used by a
source that is not a budget source (i.e. the emissions are moved off
budget), that budget source shall request that the Department reduce its
current year and future year allocation.

1. The request shall be submitted to the Department not later than the date
that the request to use the emissions reduction at the off budget source is
submitted, and shall include the following information, as a minimum:

i. The compliance account number of the budget source providing the
emissions reduction.

ii. Identification of the NOx source that is to use the emissions
reduction, including:

A. Name and mailing address of the source.

B. Name, mailing address, and telephone number of a knowledgeable
representative from that source.

iii. Identification of the calendar date for which the reduction of current
year and future year allocations is to be effective, which shall not be
later than the effective date of the use of the emissions reduction.

iv. A statement documenting the physical changes to the budget source or
changes in the methods of operating the budget source which resulted in the
reduction of NOx emissions.

v. Quantification and justifying documentation of the
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NOx emissions reduction, including a description of the methodology used to
verify the emissions reduction.

vi. The quantity of current year and future year allocations to be reduced,
which is the portion of the control period emissions reduction that is to
move off budget.

vii. Certification by the authorized account representative or alternate
authorized account representative including the following statement in
verbatim: "I am authorized to make this submission on behalf of the owners
or operators of the NOx source and I hereby certify under penalty of law,
that I have personally examined the foregoing and am familiar with the
information contained in this document and all attachments, and that based
on my inquiry of those individuals immediately responsible for obtaining
the information, I believe the information is true, accurate, and complete.
I am aware that there are significant penalties for submitting false
information, including possible fines and imprisonment."

viii. Signature of the authorized account representative or alternate
authorized account representative of the budget source providing the
emissions reduction and the date of signature.

2. Within 30 days of receipt of the submittal, the Department shall review
the submittal and take the following actions:

i. If the Department does not approve the request, the authorized account
representative identified on the submittal shall be notified in writing of
the finding and the reason(s) for the finding.

ii. If the Department approves the request, the Department shall notify in
writing the authorized account representative identified on the request and
the following provisions apply:

A. The Department shall authorize the NATS Administrator to deduct from the
compliance account of the budget source providing the emissions reduction
the quantity of current year and future year allowances to be reduced.

B. The deducted current year and future year allowances shall be
permanently retired from the NOx Budget Program.

Section 5 - Permits

a. Within 120 days of the effective date of this regulation, the owner or
operator of an existing budget source shall request amendment of any
applicable construction or operating permit issued, or application for any
permit submitted, in accordance with the State of Delaware "Regulations
Governing the Control of Air Pollution". The amendment request shall
include the following:

1. A condition(s) that requires the establishment of a
compliance account in accordance with Section 6 of this regulation.

2. A condition(s) that requires NOx mass emission monitoring during NOx
control periods in accordance with Section 13 of this regulation.

3. A condition(s) that requires NOx mass emission reporting and other
reporting requirements in accordance with Section 15 of this regulation.

4. A condition(s) that requires end-of-season compliance account
reconciliation in accordance with Section 16 of this regulation.

5. A condition(s) that requires compliance certification in accordance with
Section 17 of this regulation.

6. A condition(s) that prohibits the source from emitting NOx during each
NOx allowance control period in excess of the amount of NOx allowances held
in the source's compliance account for the NOx allowance control period as
of December 31 of the subject year.

7. A condition(s) that authorizes the transfer of allowances for purposes
of compliance with this regulation, containing reference to the source's
NATS compliance account and the authorized account representative and
alternate authorized account representative, if any.

b. Permit revisions/amendments shall not be required for changes in
emissions that are authorized by allowances held in the compliance account
provided that any transfer is in compliance with this regulation by
December 31 of each year, is in compliance with the authorization for
transfer contained in the permit, and does not affect any other applicable
state or federal requirement.

c. Permit revisions/amendments shall not be required for changes in
allowances held by the source which are acquired or transferred in
compliance with this regulation and in compliance with the authorization
for transfer in the permit.

d. Any equipment modification or change in operating practices taken to
meet the requirements of this program shall be performed in accordance with
all applicable state and federal requirements.

Section 6 - Establishment of Compliance Accounts

a. The owner or operator of each existing budget source, and each new
budget source, shall designate one authorized account representative and,
if desired, one alternate authorized account representative for that budget
source. The authorized account representative or alternate authorized
account representative shall submit to the Department an "Account
Certificate of Representation".

1. For existing budget sources, initial designations shall
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be submitted no more than 30 days following the effective date of this
regulation.

2. For new budget sources, initial designations shall be submitted no less
than 90 days prior to the first hour of operation in a NOx control period.

3. An authorized account representative or alternative account
representative may be replaced at any time with the submittal of a new
"Account Certificate of Representation". Notwithstanding any such change,
all submissions, actions, and inactions by the previous authorized account
representative or alternate authorized account representative prior to the
date and time the NATS Administrator receives the superseding "Account
Certificate of Representation" shall be binding on the new authorized
account representative, on the new alternate authorized account
representative, and on the owners and operators of the budget source.

4. Within 30 days following any change in owner or operator, authorized
account representative, or any alternate authorized account representative,
the authorized account representative or the alternate authorized account
representative shall submit a revision to the "Account Certificate of
Representation" amending the outdated information.

b. The "Account Certificate of Representation" shall be signed and dated by
the authorized account representative or the alternate authorized account
representative for the NOx budget source and shall contain, as a minimum,
the following information:

1. Identification of the NOx budget source by plant name, address, and
plant combustion unit number or equipment identification number for which
the certification of representation is submitted.

2. The name, address, telephone and facsimile number of the authorized
account representative and alternate authorized account representative, if
applicable.

3. A list of the owners and operators of the NOx budget source.

4. A description of the source, including fuel type(s), maximum heat input
capacity, and electrical output rating where applicable.

5. The following statement: "I am authorized to make this submission on
behalf of the owners and operators of the budget source for which this
submission is made. I certify under penalty of law that I have personally
examined,and am familiar with, the statements and information submitted in
this document and all its attachments. Based on my inquiry of those
individuals with primary responsibility for obtaining the information, I
certify that the statements and information are to the best of my knowledge
and belief true, accurate, and complete. I am aware that there are
significant penalties for submitting false statements and information or
omitting required statements and information, including the possibility of
fine or imprisonment."

6. Signature of the authorized account representative or alternate
authorized account representative and date of signature.

c. The Department shall review all submitted "Account Certificate of
Representation" forms. Within 30 days of receipt of the "Account
Certificate of Representation", the Department shall take one of the
following actions:

1. If not approved by the Department, the Department shall notify in
writing the authorized account representative identified in the "Account
Certificate of Representation" of the reason(s) for disapproval.

2. If approved by the Department, the Department shall forward the "Account
Certificate of Representation" to the NATS Administrator and authorize the
NATS Administrator to open a compliance account for the budget source.

d. Authorized account representative and alternate authorized account
representative designations or changes become effective upon the logged
date of receipt of a completed "Account Certificate of Representation" by
the NATS Administrator. The NATS Administrator shall acknowledge receipt
and the effective date of the designation or changes by written
correspondence to the authorized account representative.

e. The alternate authorized account representative shall have the same
authority as the authorized account representative. Correspondence from the
NATS Administrator shall be directed to the authorized account
representative.

f. Only the authorized account representative or the alternate authorized
account representative may request transfers of NOx allowances in a NATS
account. The authorized account representative shall be responsible for all
transactions and reports submitted to the NATS.

Section 7 - Establishment of General Accounts

a. An authorized account representative and alternate authorized account
representative, if any, shall be designated for each general account by the
general account owners. Said representative shall have obligations similar
to that of an authorized account representative of a budget source.

b. Any person or group of persons may open a general account in the NATS
for the purpose of holding and transferring allowances. That person or
group of persons shall submit to the Department an application to open a
general account. The general account application shall
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include the following minimum information:

1. Organization or company name to be used for the general account name
listed in the NATS, and type of organization (if applicable).

2. The name, address, telephone, and facsimile number of the account's
authorized account representative and alternate authorized account
representative, if applicable.

3. A list of all persons subject to a binding agreement for the authorized
account representative or alternate authorized account representative to
represent their ownership interest with respect to the allowances held in
the general account.

4. The following statement: "I certify that I was selected under the terms
of an agreement that is binding on all persons who have an ownership
interest with respect to allowances held in the NOx allowance tracking
system (NATS) account. I certify that I have all necessary authority to
carry out my duties and responsibilities on behalf of the persons with
ownership interest and that they shall be fully bound by my actions,
inactions, or submissions under this regulation. I shall abide by my
fiduciary responsibilities assigned pursuant to the binding agreement. I am
authorized to make this submission on behalf of the persons with an
ownership interest for whom this submission is made. I certify under
penalty of law that I have personally examined and am familiar with the
information submitted in this document and all its attachments. Based on my
inquiry of those individuals with primary responsibility for obtaining the
information, I certify that the information is to the best of my knowledge
and belief true, accurate, and complete. I am aware that there are
significant penalties for submitting false material information, or
omitting material information, including the possibility of fine or
imprisonment for violations."

5. Signature of the general account's authorized account representative or
alternate authorized account representative and date of signature.

c. The Department shall review all submitted general account and revised
general account applications. Within 30 days of receipt of the application,
the Department shall take one of the following actions:

1. If not approved by the Department, the Department shall notify in
writing the authorized account representative identified in the general
account application of the reason(s) for disapproval.

2. If approved by the Department, the Department shall forward the general
account application to the NATS Administrator and authorize the NATS
Administrator to open/revise a general account in the organization or
company name identified in the general account application.

d. No allowance transfer shall be recorded for a general account until the
NATS Administrator has established the new account.

e. The authorized account representative or alternate authorized account
representative of an established general account may transfer allowances at
any time in accordance with Section 11 of this regulation.

f. An authorized account representative or alternative account
representative of an existing general account may be replaced by submitting
to the Department a revised general account application in accordance with
Section 7(b) of this regulation.

g. The authorized account representative or alternate authorized account
representative of a general account may apply to the Department to close
the general account as follows:

1. By submitting a copy of an allowance transfer request to the NATS
Administrator authorizing the transfer of all allowances held in the
account to one or more other accounts in the NATS and/or retiring
allowances held in the account.

2. By submitting to the Department, in writing, a request to delete the
general account from the NATS. The request shall be certified by the
authorized account representative or alternate authorized account
representative.

3. Upon approval, the Department shall authorize the NATS Administrator to
close the general account and confirm closure in writing to the general
account's authorized account representative.

Section 8 - Opt In Provisions

Except as provided for in Section 4(g) of this regulation, the owner or
operator of any stationary source in the state of Delaware that is not
subject to the NOx Budget Program by definition, may choose to opt into the
NOx Budget Program as follows:

a. The owner or operator of a stationary source who chooses to opt into the
NOx Budget Program shall submit to the Department an opt-in application.
The opt-in application shall include, as a minimum, the following
information:

1. Identification of the opt-in source by plant name, address, and plant
combustion unit number or equipment identification number.

2. The name, address, telephone and facsimile number of the authorized
account representative and, if desired, of an alternative authorized
account representative.

3. A list of the owners and operators of the opt-in source.

4. A description of the opt-in source, including fuel
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type(s), maximum rated heat input capacity and electrical output rating
where applicable.

5. Documentation of the opt-in-baseline control period mass emissions (in
tons).

i. The opt-in-baseline control period emissions shall be the lower of the
average of the mass emissions from the immediately preceding two
consecutive NOx control periods and the allowable emissions.

A. If the mass emissions from the preceding two control periods are not
representative of normal operations, the Department may approve use of an
alternative two consecutive NOx control periods within the five years
preceding the date of the opt-in application.

B. If the opt-in source does not have two consecutive years of operation,
the owner or operator shall identify the lower of the permitted allowable
NOx emissions and any applicable Federal or State emission limitation as
the opt-in-baseline emissions.

ii. The documentation shall include:

A. Identification of the time period represented by the emissions data.

B. Quantification of the opt-in-baseline control period mass emissions (in
tons).

C. A description of the method used to determine the opt-in-baseline
control period NOx emissions.

6. Documentation of the opt-in-baseline NOx control period heat input (in
MMBTU).

i. The opt-in-baseline control period heat input shall be consistent with
the opt-in-baseline control period NOx mass emissions determined in Section
8(a)(5) of this regulation.

ii. The documentation shall include:

A. Quantification of the opt-in-baseline control period heat input (in
MMBTU/hr).

B. A description of the method used to determine the opt-in-baseline
control period heat input.

7. Determination of the opt-in-baseline NOx emission rate, consistent with
the guidelines of the "Procedures for Development of the OTC NOx Baseline
Emission Inventory", using the opt-in-baseline control period mass
emissions identified in Section 8(a)(5) of this regulation and the
opt-in-baseline NOx control period heat input identified in Section 8(a)(6)
of this regulation.

8. An emission monitoring plan in accordance with Section 13 of this
regulation.

9. A statement that the source was operated in accordance with all
applicable requirements during the control periods.

10. The following statement: "I am authorized to make this submission on
behalf of the owners and operators of the budget source for which this
submission is made. I certify under penalty of law that I have personally
examined, and am familiar with, the statements and information submitted in
this document and all its
attachments. Based on my inquiry of those individuals with primary
responsibility for obtaining the information, I certify that the statements
and information are to the best of my knowledge and belief true, accurate,
and complete. I am aware that there are significant penalties for
submitting false statements and information or omitting required statements
and information, including the possibility of fine or imprisonment."

11. Signature of the authorized account representative or alternate
authorized account representative and date of signature.

b. Within 60 days of receipt of any opt-in application, the Department
shall take the following actions:

1. The Department shall review the application for completeness and
accuracy and:

i. Verify that the monitoring methods used to determine the opt-in-baseline
control period NOx mass emissions and the opt-in-baseline NOx control
period heat input are consistent with those described in Section 13 of this
regulation.

ii. Verify that the opt-in-baseline emissions were calculated in accordance
with the guidelines in the "Procedures for Development of the OTC NOx
Baseline Emission Inventory".

2. If the Department disapproves the opt-in application, the authorized
account representative identified in the opt-in application shall be
notified in writing of the determination and the reason(s) for the
application not being approved.

3. If the Department determines that the opt-in application is acceptable,
the Department shall request the OTC Stationary/Area Source Committee to
review the application. Within 30 days of receiving the OTC Stationary/Area
Source Committee comments, the Department shall consider the comments and
take the following action:

i. If it is determined that the opt-in application does not properly
justify opting the source into the NOx Budget Program, the Department shall
notify the authorized account representative in writing of the
determination and the reason(s) for the application not being accepted.

ii. If it is determined that the opt-in application justifies opting the
source into the NOx Budget Program, the Department shall notify the
authorized account representative in writing of that determination.

c. The Department shall assign an allowance allocation to any owner or
operator that has been approved by the Department to opt into the NOx
Budget Program.

1. The allowance allocation for an opt-in source, that is not considered a
budget source by definition, shall be equal to the more stringent of the
opt-in-baseline control period emissions or the allowable NOx emissions
from the
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source.

2. The allowance allocation for an opt-in source that has a maximum heat
input rating of 250 MMBTU/hr shall be determined as follows:

i. For sources located in New Castle and Kent counties, allowance
allocations shall be based on the more stringent of the following:

A. The less stringent of:

1. The opt-in-baseline actual mass emissions reduced by 65%; or,

2. The mass emissions resulting from the multiplication of the actual
opt-in-baseline heat input by a NOx emissions rate of 0.20 lb/MMBTU.

B. If any permitted NOx emissions limit results in emissions that are lower
than the less stringent of the limits calculated in Sections
8(c)(2)(i)(A)(1) and 8(c)(2)(i)(A)(2), then the permitted emissions limit
shall be used to determine the emissions limitation for the NOx Budget
Program.

ii. For sources located in Sussex county, allowance allocations shall be
based on the more stringent of the following:

A. The less stringent of:

1. The opt-in-baseline actual mass emissions reduced by 55%; or,

2. The mass emissions resulting from the multiplication of the actual
opt-in-baseline heat input by a NOx emissions rate of 0.20 lb/MMBTU.

B. If any permitted NOx emissions limit results in emissions that are lower
than the less stringent of the limits calculated in Sections
8(c)(2)(ii)(A)(1) and 8(c)(2)(ii)(A)(2), then the permitted emissions limit
shall be used to determine the emissions limitation for the NOx Budget
Program.

3. If the owner or operator of an opt-in source is required to obtain NOx
emissions offsets in accordance with Regulation 25 of the State of Delaware
"Regulations Governing the Control of Air Pollution", the allowance
allocation calculated under Section 8(c)(1) or (2) of this regulation shall
be reduced by the portion of the control period emission reduction that is
associated with any budget source.

4. The allowance allocation associated with the opt-in source shall be
added to Delaware's NOx budget prior to allocation of allowances to the
opt-in source. This regulation shall be revised to reflect changes in the
number of allowances in the NOx Budget Program.

5. Under no circumstances shall the allocation of allowances to a source
which chooses to opt into the program require adjustments to the allocation
of allowances to budget sources in the NOx Budget Program.

d. Upon the approval of the opt-in application and assignment of an
allowance allocation, the Department
shall authorize the NATS Administrator to open a compliance account for the
opt-in source in accordance with Section 10 of this regulation.

e. [Within 30 days of approval to opt into the NOx Budget Program], any
owner or operator approved to opt into the NOx Budget Program shall apply
for a permit, or the modification of applicable permits, in accordance with
Section 5 of this regulation.

f. Upon approval of the opt-in application and establishment of the
compliance account, the owner or operator of the source shall be subject to
all applicable requirements of this regulation including the requirements
for allowance transfer or deduction, emissions monitoring, record keeping,
reporting, and penalties.

[1. A certification test notice and test protocol shall be ubmitted to the
Department no later than 90 days prior to anticipated performance of the
certification testing.

2. Certification testing shall be completed prior to operation in the next
NOx control period following approval of the source to opt into the NOx
Budget Program.

3. A certification test report meeting the requirements of the OTC docment
"NOx Budget Program Monitoring Certification and Reporting Instructions"
shall be submitted to the Department no later than 45 days following the
performance of the certification testing.]

g. Any owner or operator approved to opt into the NOx Budget Program that
did not have two consecutive years of operation upon initial application
and determined opt-in-baseline emissions in accordance with Section
8(a)(5)(i)(B) of this regulation shall submit to the Department a revised
opt-in application.

1. The revised opt-in application shall be submitted no more than 60 days
following first completion of operation in two consecutive NOx control
periods.

2. The revised opt-in application shall provide actual operating
information, including NOx mass emissions and heat input, for each of the
two NOx control periods.

3. [Within 60 days of receipt on any revised opt-in application], the
Department shall review the revised opt-in application.

i. If the Department does not approve the revised opt-in application:

A. The Department shall notify the opt-in source's authorized account
representative of the determination in writing and indicate the reason(s)
for the determination.

B. The opt-in source's authorized account representative shall resolve the
Department's comments and an updated revised opt-in application shall be
submitted to the Department no more than 60 days from the Department's
request.

C. Upon approval of any updated revised opt-in
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application, the Department shall process the application in accordance
with Section 8(g)(3)(ii) of this regulation.

ii. If the Department is in concurrence with the revised opt-in
application, the following actions shall be taken:

A. The Department shall request the OTC Stationary/Area Source Committee to
comment on the revised opt-in application. [,and shall consider any
comments offered by the OTC Stationary/Area Source Committee.] [Within 30
days of receiving the OTC Stationary/Area Source Committee comments, the
Department shall consider the comments and take action in accordance with
Section 8(g)(ii)(B) or Section 8(g)(3)(ii)(C) of this regulation.]

B. If it is determined that the revised opt-in application shall not be
approved:

1. The Department shall notify the opt-in source's authorized account
representative of the determination in writing and indicate the reason(s)
for the determination.

2. The opt-in source's authorized account representative or alternate
authorized account representative shall resolve the Department's comments
and an updated revised opt-in application shall be submitted to the
Department no more than 60 days from the Department's request.

3. Upon approval of any updated revised opt-in application, the Department
shall process the application in accordance with Section 8(g)(3)(ii)(C) of
this regulation.

C. If it is determined that the revised opt-in shall be approved, the
following actions shall be taken:

1. If the initial allocation was lower than that indicated in the revised
application:

a. The Department shall revise the NOx budget to reflect the allocation
determination identified in the revised opt-in application.

b. The Department shall authorize the NATS Administrator to revise the
allocation to the subject source's compliance account.

c. The Department shall not authorize any additional allowances to cover
any shortfall in the two opt-in-baseline NOx control periods. Any violation
of a permit condition or of this regulation may result in an enforcement
action.

2. If the initial allocation was higher than that indicated in the revised
application:

a. The Department shall revise the NOx budget to reflect the allocation
determination identified in the revised opt-in application.

b. The Department shall authorize the NATS Administrator to revise the
allocation to the subject source's compliance account.

c. The Department shall authorize the NATS Administrator to deduct the
excess allowances allocated to the opt-in source, calculated as the
difference between the actual allocated allowances and the allowances
allocated on the basis of the revised opt-in application for the years of
operation in NOx control periods.

h. Any owner or operator who chooses to opt into the NOx Budget Program can
not opt-out of the program unless NOx emitting operations at the opt-in
source have ceased, and the allowance adjustment provisions of Section 8(i)
of this regulation apply.

i. Any owner or operator who chooses to opt into the NOx Budget Program and
who subsequently chooses to cease or curtail operations during any NOx
allowance control period after opting-in shall be subject to an allowance
adjustment equivalent to the NOx emissions decrease that results from the
shut down or curtailment.

1. The NETS Administrator shall compare actual heat input data following
each NOx control period with the opt-

in-baseline heat input for each opt-in source.

2. The NATS Administrator shall calculate and deduct allowances equivalent
to any decrease in the opt-in source's heat input below its opt-in-baseline
heat input. This deduction shall be calculated using the average of the two
most recent years heat input compared to the heat input used in the
opt-in-baseline calculation.

3. The NATS Administrator shall notify the NOx budget source's authorized
account representative and the Department of any such deductions.

4. This adjustment affects only the current year allocation and shall not
effect the NOx budget source's allocations for future years.

5. No deduction shall result from reducing NOx emission rates below the
rate used in the opt-in allowance calculation.

6. A source that is to be repowered or replaced can be opted into the NOx
Budget Program without the shutdown/curtailment deductions. The heat input
for the repowered or replaced source can be substituted for the present
year's activity for the opt-in NOx allowance adjustment calculation.

j. For replacement sources, all sources under common control in the State
of Delaware to which production may be shifted shall be opted-in together.

k. When an opt-in source undergoes reconstruction or modification such that
the source becomes a budget source by definition:

1. The opt-in source's authorized account representative or alternate
authorized account representative shall notify the Department within 30
days of completion of the modification or reconstruction.

2. The Department shall authorize the NATS Administrator to deduct
allowances equal to those
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allocated to the opt-in source in the NOx control period for the calendar
year in which the opt-in source becomes a budget source by definition.

3. The Department shall authorize the NATS Administrator to deduct all
allowances that were allocated pursuant to Section 8(c) of this regulation
to the opt-in source, for all future years following the calendar year in
which the opt-in source becomes a budget source by definition. This
regulation shall be revised to reflect changes in the number of allowances
in the NOx Budget Program.

4. The reconstructed or modified source shall be treated as a new budget
source in accordance with Section 9 of this Regulation.

Section 9 - New Budget Source Provisions

a. NOx allowances shall not be created for new NOx sources that are budget
sources by definition. The owner or operator is responsible to acquire any
required NOx allowances from the NATS.

b. The owner or operator of a new budget source shall establish a
compliance account and be in compliance with all applicable requirements of
this regulation prior to the commencement of operation in any NOx control
period. New budget sources shall:

1. Request a [permit/]permit amendment[/revision] in accordance with
Section 5 of this regulation [no less than 90 days prior to operation in
any NOx control period].

2. Submit a monitoring plan to the Department, in accordance with Section
13 of this regulation, no later than 90 days prior to the anticipated
performance of monitoring system certification.

3. Install and operate an approved monitoring system(s) to measure, record,
and report hourly and cumulative NOx mass emissions.

4. [Submit to the Department a certification test notice and protol no
later than 90 days prior to the anticipated performance of the
certification testing.]

[4] [5]. Complete the monitoring system certification prior to operation in
any NOx control period.

[6. Submit to the Department a certification test report meeting the
requirements of the OTC document "NOx Budget Program Monitoring
Certification and Reporting Instructions" no later than 45 days following
the performance of the certification testing.]

Section 10 - NOx Allowance Tracking System (NATS)

a. The NOx allowance tracking system is an electronic recordkeeping and
reporting system which is the official database for all NOx allowance
deduction and transfer within this program. The NATS shall track:

1. The allowances allocated to each budget source.

2. The allowances held in each account.

3. The allowances deducted from each budget source during each control
period, as requested by a transfer request submitted by the budget source's
authorized account representative or alternate authorized account
representative in accordance with Section 16(b) of this regulation.

4. Compliance accounts established for each budget source to determine the
compliance for the source, including the following information:

i. The account number of the compliance account.

ii. The name(s), address(es), and telephone number(s) of the account owner
(s).

iii. The name, address, and telephone number of the authorized account
representative and alternate authorized account representative, as
applicable.

iv. The name and street address of the associated budget source, and the
state in which the budget source is located.

v. The number of allowances held in the account.

5. General accounts opened by individuals or entities, upon request, which
are not used to determine compliance, including the following information:

i. The account number of the general account.

ii. The name(s), address(es) and telephone number(s) of the account
owner(s).

iii. The name, address, and telephone number of the authorized account
representative and alternate authorized account representative, as
applicable.

iv. The number of allowances held in the account.

6. Allowance transfers.

7. Deductions of allowances by the NATS Administrator for compliance
purposes, in accordance with Section 16(d) of this regulation.

b. The NATS Administrator shall establish compliance and general accounts
when authorized to do so by the Department pursuant to Sections 6, 7, and 8
of this regulation.

c. Each compliance account and general account shall have a unique
identification number and each allowance shall be assigned a unique serial
number. Each allowance serial number shall indicate the year of allocation.

Section 11 - Allowance Transfer

a. Allowances may be transferred at any time during any year, not just the
current year.

b. The transfer of allowances between budget sources in different states
for purposes of compliance is contingent upon the adoption and
implementation by those states of
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[comparable and consistent] NOx budget program regulations, and their
participation in the NATS. [A program is considered comparable and
consistent if it is approved by the EPA for incorporation in the subject
states' state implementation plan (SIP).]

c. Transfer requests shall be submitted to the NATS Administrator on a form
or electronic media, as directed by the NATS Administrator, and shall
include the following information:

1. The account number of the originating account and the acquiring account.

2. The name(s) and address(es) of the owner(s) of the originating account
and the acquiring account.

3. The serial number of each allowance being transferred.

4. The following statement from the authorized account representative or
alternate authorized account representative of the originating account, in
verbatim: "I am authorized to make this submission on behalf of the owners
or operators of the budget source and I hereby certify under penalty of
law, that I have personally examined the foregoing and am familiar with the
information contained in this document and all attachments, and that based
on my inquiry of those individuals immediately responsible for obtaining
the information, I believe the information is true, accurate, and complete.
I am aware that there are significant penalties for submitting false
information, including possible fines and imprisonment."

5. Signature of the authorized account representative or alternate
authorized account representative of the originating account and the date
of signature.

d. The Authorized account representative or alternate authorized account
representative for the originating account shall further provide a copy of
the transfer request to each owner or operator of the budget source.

e. Transfer requests shall be processed by the NATS Administrator in order
of receipt.

f. A transfer request shall be determined to be valid by the NATS
Administrator if:

1. Each allowance listed in the transfer request is held by the originating
account at the time the transfer is to be recorded.

2. The acquiring party has an account in the NATS.

3. The transfer request has been certified by the person named as
authorized account representative or alternate authorized account
representative for the originating account.

g. Transfer requests judged valid by the NATS Administrator shall be
completed and recorded in the NATS by deducting
the specified allowances from the originating account and adding them to
the acquiring account.

h. Transfer requests judged to be invalid by the NATS Administrator shall
be returned to the authorized account representative indicated on the
transfer request along with documentation why the transfer request was
judged to be invalid.

i. The NATS Administrator shall provide notification of an allowance
transfer to the authorized account representatives of the originating
account, the authorized account representative of the acquiring account,
and the Department, including the following information:

1. The effective date of transfer.

2. Identification of the originating account and acquiring account by name
as well as by account number.

3. The number of allowances transferred and their serial numbers.

j. The authorized account representative or alternate authorized account
representative of a compliance account or a general account may request
that some or all allocated allowances be transferred to another compliance
account or to a general account for the current year, any future year,
block of years, or for the duration of the program. The authorized account
representative or alternate authorized account representative of the
originating account shall submit a request for transfer that states this
intent to the NATS Administrator, and the transfer request shall conform to
the requirements of this Section. In addition, the request for transfer
shall be submitted to the Department with a letter requesting that the
budget be revised to reflect the change in allowance allocations.

k. Upon request by the Department any authorized account representative or
alternate authorized account representative shall make available to the
Department information regarding transaction cost and allowance price.

Section 12 - Allowance Banking

a. The banking of allowances is permitted to allow retention of unused
allowances from one year to a future year in either a compliance account or
a general account.

b. Except for allowances created under Section 12(d) of this regulation,
allowances not used under Section 16 of this regulation shall be held in a
compliance account or general account and designated as "banked" allowances
by the NATS Administrator.
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c. The use of banked allowances shall be restricted as follows:

1. By March 1 of each year the NATS Administrator shall divide the total
number of banked allowances by the regional NOx budget.

i. If the total number of banked allowances in the NATS is less than or
equal to 10% of the regional NOx budget for the current year control
period, all banked allowances can be deducted in the current year on a
1-for-1 basis.

ii. If the total number of banked allowances in the NATS exceeds 10% of the
regional NOx budget for the current year control period, budget sources
shall be notified by the NATS Administrator of the allowance ratio which
must be applied to banked allowance in each compliance account and general
account to determine the number of allowances available for deduction in
the current year control period on a 1-for-1 basis and the number of
allowances available for deduction on a 2-for-1 basis.

2. Where a finding has been made by the NATS Administrator that banked
allowances exceed 10% of the current year regional NOx budget, each NATS
compliance account and general account of banked allowances shall be
subject to the following banked allowance deduction protocol:

i. A ratio shall be established according to the following formula:

0.10 x the regional NOx Budget

the total number of banked allowances in the region

ii. The ratio calculated in Section 12(c)(2)(i) of this regulation shall be
applied to the banked allowances in each account. The resulting number is
the number of banked allowances in the account which can be used in the
current year control period on a 1-for-1 basis. Banked allowances in excess
of this number, if used, shall be used on a 2-for-1 basis.

d. The owner or operator of a budget source may apply to the Department to
receive early reduction allowances for actual NOx reductions occurring in
1997 and/or 1998.

1. No later than October 1, 1998, the authorized account representative or
alternate authorized account representative from any budget source seeking
early reduction allowances shall submit to the Department an application
that includes, at a minimum, the following information:

i. Identification of the budget source.

ii. Identification of the calendar time period for which early reduction
allowances are being sought (i.e. May 1 -
September 30, 1997, May 1 - September 30, 1998, or both).

iii. Identification of the baseline NOx control period emission limit
(tons), which shall be the more stringent of the following:

A. The level of control required by the OTC MOU;

B. The lower of the permitted allowable emissions for the source and the
allowable emissions identified in the state implementation plan (SIP);

C. The actual emissions for the 1990 control period, or;

D. The actual emissions for the average of two representative year control
periods within the first five years of operation if the budget source did
not commence operation until after 1990.

iv. The baseline NOx control period heat input (MMBTU) corresponding to the
baseline NOx control period emission limit (tons) determined in Section
12(d)(1)(iii) of this regulation.

v. The actual NOx control period NOx emissions (tons) occurring in 1997
and/or 1998, as applicable.

vi. The actual NOx control period heat input (MMBTU) occurring in 1997
and/or 1998, as applicable.

vii. The calculated NOx control period emissions rate (lb/MMBTU), as
determined using the control period NOx emissions identified in Section
12(d)(1)(v) of this regulation multiplied by 2000 to obtain actual
emissions in pounds (lbs), divided by the control period heat input (MMBTU)
identified in Section 12(d)(1)(vi) of this regulation.

viii. The amount of NOx emissions early reduction allowances shall be
calculated by subtracting the actual control period NOx emissions (in
tons), identified in Section 12(d)(1)(v)of this regulation, from the
baseline NOx emissions limit (in tons) identified in Section 12(d)(1)(iii)
of this regulation.

ix. If the actual control period heat input, as identified in Section
12(d)(1)(vi) of this regulation, is less than the baseline NOx control
period heat input, as identified in Section 12(d)(1)(iv) of this
regulation, the NOx emissions early reduction allowances determined in
Section 12(d)(1)(viii) of this regulation shall be corrected as follows:

A. The actual control period heat input (MMBTU), as identified in Section
12(d)(1)(vi) of this regulation, shall be subtracted from the baseline NOx
control period heat input (MMBTU), as identified in Section 12(d)(1)(iv) of
this regulation, to obtain the heat input correction.

B. The heat input correction (MMBTU) is multiplied by the calculated NOx
control period emissions rate (lb/MMBTU) determined in Section
12(d)(1)(vii) of this regulation. The resulting value is divided by 2000 to
obtain tons of NOx.

C. The corrected NOx emissions early reduction allowance is the result of
subtracting the results of Section
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12(d)(1)(ix)(B) of this regulation from the NOx emissions early reduction
allowances calculated in Section 12(d)(1)(viii) of this regulation.

x. A statement indicating the budget source was operating in accordance
with all applicable requirements during the applicable NOx control period
including:

A. Whether the monitoring plan that was submitted in accordance with
Section 13 of this regulation was maintained to reflect the actual
operation and monitoring of the unit and contains all information necessary
to attribute monitored emissions to the budget source. If early reduction
allowances are being sought for a control period prior to the
implementation of monitoring in accordance with Section 13(a) of this
regulation, a monitoring plan prepared in accordance with Section 13(a) of
this regulation shall be submitted describing the monitoring method in use
during the control period for which early reduction allowances are being
sought.

B. Whether all the emissions from the budget source were monitored, or
accounted for, throughout the NOx control period and reported.

C. Whether the information that formed the basis for certification of the
emissions monitoring plan has changed affecting the certification of the
monitoring.

D. If a change in the monitoring method is reported under Section
12(d)(1)(x)(C) of this regulation, specify the nature of the change, the
reason for the change, when the change occurred, and what method was used
to determine emissions during the period mandated by the change.

xi. A statement documenting the specific physical changes to the budget
source or changes in the methods of operating the budget source which
resulted in the reduction of emissions.

xii. The following statement: "I certify under penalty of law that I have
personally examined, and am familiar with, the statements and information
submitted in this document and all its attachments. Based on my inquiry of
those individuals with primary responsibility for obtaining the
information, I certify that the statements and information are to the best
of my knowledge and belief true, accurate, and complete. I am aware that
there are significant penalties for submitting false statements and
information or omitting required statements and information, including the
possibility of fine or imprisonment."

xiii. Signature of the authorized account representative or alternate
authorized account representative and date of signature.

2. Early reduction allowance requests shall be reviewed by the Department.

i. If the Department determines that the emissions reductions were not
enforceable, real, quantifiable, or surplus, the Department shall notify
the budget source's
authorized account representative in writing, indicating the reason(s) the
request for early reduction allowances is being denied.

ii. If the Department determines that the emissions reductions are
enforceable, real, quantifiable, and surplus:

A. The Department shall request the OTC Stationary/Area Source Committee to
comment on the generation of potential early reduction allowances.

B. The Department shall consider the OTC Stationary/Area Source Committee
comments and either:

1. Notify the budget source's authorized account representative in writing
denying the request for early reduction allowances and indicate the
reason(s) for the determination; or

2. Notify the budget source's authorized account representative in writing
that the requested emissions reduction allowances shall be added to the
budget source's account; and

3. Authorize the NATS Administrator to add the allowances to the budget
source's account as 1999 allowances.

3. Reductions associated with repowering of a budget source are eligible
for early reduction credit provided that the permit for construction of the
replacement source was issued after the date of the OTC MOU (September 27,
1994), and the budget source being replaced ceases operation in 1997 or
1998.

4. On or before May 1, 1999, the Department shall publish a report which
documents the applicable sources and the number of early reduction credits
awarded.

Section 13 - Emission Monitoring

a. NOx emissions from each budget source shall be monitored in accordance
with this section and in accordance with the requirements of the OTC
documents titled "Guidance for Implementation of Emissions Monitoring
Requirements for the NOx Budget Program", dated January 28, 1997, and "NOx
Budget Program Monitoring Certification and Reporting Instructions", dated
July 3, 1997. The provisions of these documents are hereby adopted by
reference.

b. Monitoring systems are subject to initial performance testing and
periodic calibration, accuracy testing, and quality assurance/quality
control testing as specified in the OTC document titled "Guidance for
Implementation of Emissions Monitoring Requirements for the NOx Budget
Program". If an owner or operator uses certified monitoring systems under
Part 75 to meet the requirements of this program and maintains and operates
those monitoring systems according to the requirements of Part 75, it is
not necessary to re-perform initial certification tests to ensure the
accuracy of these components under the
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NOx Budget Program.

c. During a period when valid data is not being recorded by devices
approved for use to demonstrate compliance with the requirements of this
section, the owner or operator shall provide substitute data in accordance
with the requirements of:

1. For Part 75 budget sources, the procedures of 40 CFR Part 75, Subpart D,
and Part 1 of the OTC documenttitled "Guidance for Implementation of
Emissions Monitoring Requirements for the NOx Budget Program".

2. For non-Part 75 budget sources, the procedures of Part 2 of the OTC
document "Guidance for Implementation of Emission Monitoring Requirements
for the NOx Budget Program" [except for those provisions in this document
that allow alternative methods or procedures. Any alternative methods or
procedures must be reviewed by the Department and the EPA].

d. The owner or operator of a NOx budget source shall meet the following
emissions monitoring deadlines:

1. All existing Part 75 NOx budget sources not required by the NOx Budget
Program to install additional monitoring equipment, or required to only
make software changes to implement the additional requirements of this
program, shall meet the monitoring requirements of the NOx Budget Program
as follows:

i. By meeting all current Part 75 monitoring requirements during the NOx
control period during each calendar year.

ii. By monitoring hourly and cumulative NOx mass emissions for the NOx
control period in each calendar year starting in 1999 in accordance with
the OTC documents "Guidance for Implementation of Emissions Monitoring
Requirements for the NOx Budget Program" and "NOx Budget Program Monitoring
Certification and Reporting Instructions".

2. All existing Part 75 budget sources required to install and certify new
monitoring systems to meet the requirements of the NOx Budget Program shall
meet the monitoring requirements of this program as follows:

i. By meeting all current Part 75 monitoring requirements during the NOx
control period during each calendar year.

ii. Monitoring systems required to be installed by the NOx Budget Program
shall be installed and monitoring and recording hourly mass emissions data
on and after July 1, 1998.

iii. By monitoring hourly and cumulative NOx mass emissions using certified
monitoring systems for each NOx control period each calendar year starting
in 1999 in accordance with the OTC documents "Guidance for Implementation
of Emissions Monitoring Requirements for the NOx Budget Program" and "NOx
Budget Program
Monitoring Certification and Reporting Instructions".

3. All existing non-Part 75 budget sources shall meet the monitoring
requirements of the NOx Budget Program as follows:

i. Monitoring systems required to be installed by the NOx Budget Program
shall be installed and monitoring and recording hourly emissions data on
July 1, 1998.

ii. By monitoring hourly and cumulative NOx mass emissions using certified
monitoring systems for each NOx control period of each calendar year
starting in 1999 in accordance with the OTC documents "Guidance for
Implementation of Emissions Monitoring Requirements for the NOx Budget
Program" and "NOx Budget Program Monitoring Certification and Reporting
Instructions".

e. The owner or operator of a budget source subject to 40 CFR Part 75 shall
demonstrate compliance with this section with a certified Part 75
monitoring system.

1. The authorized account representative or alternate authorized account
representative shall submit to the Department a monitoring plan prepared in
accordance with 40 CFR Part 75 and the additional requirements of the OTC
document "Guidance for the Implementation of Emission Monitoring
Requirements for the NOx Budget Program" and the OTC document "NOx Budget
Program Monitoring Certification and Reporting Instructions".

i. All existing Part 75 budget sources not required to install additional
monitoring equipment shall submit to the Department a complete hardcopy
monitoring plan containing monitoring plan changes and additions required
by the NOx Budget Program in the second quarter 1998 quarterly report as
required under Section 15 of this regulation. These Part 75 budget sources
shall also submit to the Department a complete electronic monitoring plan
upon request by the Department.

ii. For any Part 75 budget source required to install and certify new
monitoring systems, submit to the Department a complete hardcopy monitoring
plan acceptable to the Department at least 45 days prior to the initiation
of certification tests for the new system(s). These Part 75 budget sources
shall also submit to the Department a complete electronic monitoring plan
upon request by the Department.

iii. For new budget sources under 40 CFR Part 75, submit to the Department
the NOx Budget Program information with the hardcopy Acid Rain Program
monitoring plan no later than 90 days prior to the projected Acid Rain
Program participation date. These new Part 75 budget sources shall also
submit to the Department a complete electronic monitoring plan upon request
by the Department.

2. The authorized account representative or alternate authorized account
representative shall obtain certificationof the NOx emissions monitoring
system in
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accordance with 40 CFR Part 75 and the additional requirements of the OTC
document "Guidance for the Implementation of Emission Monitoring
Requirements for the NOx Budget Program" and the OTC document "NOx Budget
Program Monitoring Certification and Reporting Instructions".

i. If the Part 75 budget source uses certified monitoring systems under
Part 75 to meet the requirements of the NOx Budget Program and maintains
and operates those monitoring systems according to the requirements of Part
75, it is not necessary to re-perform initial certification tests to ensure
the accuracy of the monitoring systems under the NOx Budget Program.

A. Formula verifications must be performed to demonstrate that the data
acquisition system accurately calculates and reports NOx mass emissions
(lb/hr) based on hourly heat input (MMBTU/hr) and NOx emission rate
(lb/MMBTU).

B. Formula verifications shall be submitted to the Department no later than
July 1, 1998.

ii. If it is necessary for the owner or operator of a Part 75 budget source
to install and operate additional NOx or flow systems or fuel flow systems
because of stack and unit configuration, the owner or operator must certify
the monitoring systems using the procedures of 40 CFR Part 75.

A. Successful certification testing of the monitoring system in accordance
with the requirements of 40 CFR Part 75 shall be completed no later than
April 30, 1999.

B. A certification test notice and protocol shall be submitted to the
Department for approval no later than 90 days prior to the anticipated
performance of the certification testing.

C. A certification report meeting the requirements of the OTC document "NOx
Budget Program Monitoring Certification and Reporting Instructions" shall
be submitted to the Department no later than 45 days following the
performance of the certification testing.

3. If the Part 75 budget source has a flow monitor certified under Part 75,
NOx emissions in pounds per hour shall be determined using the Part 75 NOx
CEMS and the flow monitor. The NOx emission rate in pounds per million BTU
shall be determined using the procedure in 40 CFR Part 75, Appendix F,
Section 3. The hourly heat input shall be determined by using the
procedures in 40 CFR Part 75, Appendix F, Section 5. The NOx emissions in
pounds per hour shall be determined by multiplying the NOx emissions rate
(in pounds per million BTU) by the heat input rate (in million BTU per
hour).

4. If the Part 75 budget source does not have a certified flow monitor, but
does have a certified NOx CEMS, the NOx emissions rate in pounds per hour
shall be determined by using the NOx CEMS to determine the NOx emission
rate in pounds per million BTU and the heat input shall be
determined by using the procedures in 40 CFR Part 75, Appendix D. The NOx
emissions rate (in pounds per hour) shall be determined by multiplying the
NOx emissions rate (in pounds per million BTU) by the heat input rate (in
million BTU per hour).

5. If the Part 75 budget source uses the procedures in 40 CFR Part 75,
Appendix E, to determine the NOx emission rate, the NOx emissions in pounds
per hour shall be determined by multiplying the NOx emissions rate (in
pounds per million BTU) determined using the Appendix E procedures times
the heat input (in million BTU per hour) determined using the procedures in
40 CFR Part 75, Appendix D.

6. If the Part 75 budget source uses the procedures in 40 CFR Part 75,
Subpart E, to determine NOx emission rate, the NOx emissions in pounds per
hour shall be determined using the alternative monitoring method approved
under 40 CFR Part 75, Subpart E, and the procedures contained in the OTC
document titled "Guidance for Implementation of Emission Monitoring
Requirements for the NOx Budget Program".

7. The relevant procedures of the OTC document "Guidance for the
Implementation of Emission Monitoring Requirements for the NOx Budget
Program" shall be employed for unusual or complicated stack configurations.

f. The owner or operator of a budget source not subject to 40 CFR Part 75
shall seek the use of a NOx monitoring method to comply with this
regulation as follows:

1. The authorized account representative or alternate authorized account
representative shall prepare and submit to the Department for approval a
hardcopy monitoring plan for each NOx budget source. Upon request by the
Department, the authorized account representative or alternate authorized
account representative shall also submit to the Department a complete
electronic monitoring plan. Sources subject to the program on July 1, 1998
shall submit the complete monitoring plan no later than March 30, 1998.
Sources becoming subject to the budget program after July 1, 1998 must
submit a complete monitoring plan no later than 90 days prior to projected
initial participation date. The monitoring plan shall be prepared in
accordance with the requirements of the OTC documents "Guidance for the
Implementation of the Emission Monitoring Requirements for the NOx Budget
Program" and "NOx Budget Program Monitoring and Certification and Reporting
Instructions", and shall contain the following information, as a minimum:

i. A description of the monitoring method to be used.

ii. A description of the major components of the monitoring system
including the manufacturer, serial number of the component, the measurement
span of the component and documentation to demonstrate that the measurement
span of each component is appropriate to
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measure all of the expected values. This requirement applies to all
monitoring systems including NOx CEMS which have not been certified
pursuant to 40 CFR Part 75.

iii. An estimate of the accuracy of the system and documentation to
demonstrate how the estimate of accuracy was determined. This requirement
applies to all monitoring systems that are not installed/being installed in
accordance with the requirements of 40 CFR Part 75.

iv. A description of the tests that will be used for initial certification,
initial quality assurance, periodic quality assurance, and relative
accuracy.

v. If the monitoring method of determining heat input involves boiler
efficiency testing, a description of the tests to determine boiler
efficiency.

vi. If the monitoring method uses fuel sampling, a description of the test
to be used in the fuel sampling program.

vii. If the monitoring method utilizes a generic default emission rate
factor, the monitoring plan shall identify the generic default emission
rate factor and provide documentation of the applicability of the generic
default emission rate factor to the non-Part 75 budget source.

viii. If the monitoring method utilizes a unit specific default emission
rate factor the monitoring plan shall include the following:

A. All necessary information to support the emission rate including:

1. Historical fuel use data and historical emissions test data if previous
testing has been performed prior to May 1, 1997 to meet other state or
federal requirements and the testing was performed using Department
approved methods and protocols; or

2. If emissions testing is performed to determine the emission rate,
include a test protocol explaining the test to be conducted. All test
performed on or after May 1, 1997 must meet the requirements of 40 CFR Part
75, Appendix E, and the requirements of the OTC document "Guidance for
Implementation of Emission Monitoring Requirements for the NOx Budget
Program".

B. Procedures which will be utilized to demonstrate that any control
equipment in operation during the testing to develop source specific
emission factors, or during development of load-based emission curves, are
in use when those emission factors are applied to estimate NOx emissions.

C. Alternative uncontrolled emission rates to be used to estimate NOx
emissions during periods when control equipment is not being used or is
inoperable.

ix. If the monitoring method utilizes fuel flow meters to determine heat
input and said meters have not been certified pursuant to 40 CFR Part 75,
the monitoring plan shall include a description of all components of the
fuel flow meter, the estimated accuracy of the fuel flow meter, the most
recent calibration of each of the components and
the original accuracy specifications from the manufacturer of the fuel flow
meter.

x. The submitted complete monitoring plan shall meet all of the provisions
of Part 2, Section II of the OTC document "Guidance for the Implementation
of the Emission Monitoring Requirements for the NOx Budget Program" and the
OTC document "NOx Budget Program Monitoring Certification and Reporting
Instructions".

2. The authorized account representative or alternate authorized account
representative shall obtain certification of the NOx emissions monitoring
system in accordance with the requirements of the OTC documents "Guidance
for the Implementation of the Emission Monitoring Requirements for the NOx
Budget Program" and "NOx Budget Program Monitoring Certification and
Reporting Instructions".

i. The certification testing shall be successfully completed no later than
April 30, 1999.

ii. A certification test notice and protocol shall be submitted to the
Department no later than 90 days prior to the anticipated performance of
the certification testing.

iii. A certification report meeting the requirements of the OTC document
"NOx Budget Program Monitoring Certification and Reporting Instructions"
shall be submitted to the Department no later than 45 days following the
performance of the certification testing.

3. The owner or operator of a non-Part 75 budget source shall monitor NOx
emissions in accordance with one of the following requirements:

i. Any non-Part 75 budget source that has a maximum rated heat input
capacity of 250 MMBTU/hr or greater which is not a peaking unit as defined
in 40 CFR 72.2, or whose operating permit allows for the combustion of any
solid fossil fuel, or is required to install a NOx CEMS for the purposes of
meeting either the requirements of 40 CFR Part 60 or any other Department
or Federal requirement, shall install, certify, and operate a NOx CEMS. Any
budget source that has previously installed a NOx CEMS for the purposes of
meeting either the requirements of 40 CFR Part 60 or any other Department
or Federal requirement shall certify and operate the NOx CEMS.

A. The NOx CEMS shall be used to measure stack gas NOx concentration and
the NOx emissions rate in lb/MMBTU calculated in accordance with the
procedures in 40 CFR Part 75, Appendix F.

B. Any non-Part 75 budget source utilizing a NOx CEMS shall meet the
following requirements from the OTC document "Guidance for the
Implementation of Emission Monitoring Requirements for the NOx Budget
Program":

1. Initial certification requirements identified in Part 2, Section III.

2. Quality assurance requirements identified in Part 2, Section IV.

3. Re-certification requirements identified in Part
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2, Section V.

ii. The owner or operator of a non-Part 75 budget source not required to
install a NOx CEMS in accordance with Section 13(f)(3)(i) of this
regulation may elect to install a NOx CEMS meeting the requirements of 40
CFR Part 75 or Section 13(f)(3)(i) of this regulation.

iii. The owner or operator of a non-Part 75 budget source that is not
required to have a NOx CEMS may request approval from the Department to use
any of the following methodologies to determine the NOx emission rate:

A. The owner or operator of a non-Part 75 budget source may request the use
of an alternative monitoring methodology meeting the requirements of 40 CFR
Part 75, Subpart E. The Department must approve the use of an alternative
monitoring system before such system is operated to meet the requirements
of the NOx Budget Program. If the methodology must be incorporated into a
permit pursuant to Regulation 30 of Delaware's "Regulations Governing the
Control of Air Pollution", the methodology must also be approved by the
EPA.

B. The owner or operator of a boiler or combustion turbine non-Part 75
budget source may request the use of the procedures contained in 40 CFR
Part 75, Appendix E, to measure the NOx emission rate, in lb/MMBTU,
consistent with the requirements identified in Part 2 of the OTC document
"Guidance for the Implementation of Emission Monitoring Requirements for
the NOx Budget Program.

C. The owner or operator of a combustion turbine non-Part 75 budget source
may request the use of default emission factors to determine NOx emissions,
in pounds per MMBTU, as follows:

1. For oil-fired combustion turbines, the generic default emission factor
is 1.2 pounds of NOx per MMBTU.

2. For gas-fired combustion turbines, the generic default emission factor
is 0.7 pound of NOx per MMBTU.

3. The owner or operator of oil-fired and gas-fired combustion turbines may
perform testing, in accordance with Department approved methods, to
determine unit specific maximum potential NOx emission rates in accordance
with the requirements of Part 2 of the OTC document "Guidance for
Implementation of Emission Monitoring Requirements for the NOx Budget
Program."

D. The owner or operator of a boiler non-Part 75 budget source may request
the use of default emission factors to determine NOx emissions, in pound
per MMBTU, as follows:

1. For oil-fired boilers, the generic default emission factor is 2.0 pounds
of NOx per MMBTU.

2. For gas-fired boilers, the generic default emission factor is 1.5 pound
of NOx per MMBTU.

3. The owner or operator of oil-fired and gas-fired boilers may perform
testing, in accordance with Department approved methods, to determine unit
specific maximum
potential NOx emission rates in accordance with the requirements of the OTC
document "Guidance for Implementation of Emission Monitoring Requirements
for the NOx Budget Program.

4. The owner or operator of a non-Part 75 budget source may determine heat
input in accordance with the following guidelines:

i. The owner or operator of a non-Part 75 budget source using a NOx CEMS to
measure NOx emission rate may elect to measure stack flow and diluent ( O2
or CO2) concentration and use the procedures of 40 CFR Part 75, Appendix F,
to determine the hourly heat input. For flow monitoring systems, the
non-Part 75 budget source must meet all applicable requirements of 40 CFR
Part 75.

ii. The owner or operator of a non-Part 75 budget source combusting only
oil and/or natural gas may determine hourly heat input rate by monitoring
fuel flow and conducting fuel sampling.

A. The owner or operator of a non-Part 75 budget source may monitor fuel
flow by using fuel flow meter systems certified under 40 CFR Part 75,
Appendix D, or as defined in Part 2, Section III of the OTC document
"Guidance for Implementation of Emissions Monitoring Requirements for the
NOx Budget Program".

B. The owner or operator of a non-Part 75 budget source combusting oil may
perform oil sampling and testing in accordance with the requirements of 40
CFR Part 75 or Part 2, Section I(C)(2) of the OTC document "Guidance for
the Implementation of Emissions Monitoring Requirements for the NOx Budget
Program".

C. The owner or operator of a non-Part 75 budget source combusting gas must
determine the heating value of the gas in accordance with the requirements
of 40 CFR Part 75 or the methodologies approved in Part 2, Section I(C)(2)
of the OTC document "Guidance for the Implementation of Emissions
Monitoring Requirements for the NOx Budget Program".

iii. The owner or operator of a non-Part 75 budget source electrical
generating unit less than 25 megawatts rated capacity that combusts only
oil or gas may petition the Department to determine heat input by measuring
fuel used on a frequency of greater than one hour but no less than weekly.

A. The fuel usage must be reported on an hourly basis by apportioning the
fuel based on electrical load in accordance with the following formula:

Hourly fuel usage = Hourly electrical load x total fuel usage

Total electrical load

B. The owner or operator of a non-Part 75 budget source combusting oil may
perform oil sampling and testing in accordance with the requirements of 40
CFR Part 75 or
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Part 2, Section I(C)(2) of the OTC document "Guidance for the
Implementation of Emissions Monitoring Requirements for the NOx Budget
Program".

C. The owner or operator of a non-Part 75 budget source combusting gas must
determine the heating value of the gas in accordance with the requirements
of 40 CFR Part 75 or the methodologies approved in Part 2, Section I(C)(2)
of the OTC document "Guidance for the Implementation of Emissions
Monitoring Requirements for the NOx Budget Program".

iv. The owner or operator of a non-Part 75 budget source that combusts only
oil and/or gas and has elected to use a unit-specific or generic default
NOx emission rate, may petition the Department to determine hourly heat
input based on fuel use measurements for a specified period that is longer
than one hour.

A. The petition must include a description of the periodic measurement
methodology, including an assessment of its accuracy.

B. Each time period must begin on or after May 1 and conclude on or before
September 30 of each calendar year.

C. To determine hourly input, the owner or operator shall apportion the
long term fuel measurements to operating hours during the control period.

D. Fuel sampling and analysis must conform to the requirements of Part 2,
Section I(C)(2) of the OTC document "Guidance for Implementation of
Emission Monitoring Requirements for the NOx Budget Program".

v. The owner or operator of a non-Part 75 budget source that combusts any
fuel other than oil or natural gas may petition the Department to use an
alternative method of determining heat input, including:

A. Conducting fuel sampling and analysis and monitoring fuel usage.

B. Using boiler efficiency curves and other monitored information such as
boiler steam output.

C. Any other method approved by the Department and which meets the
requirements identified in Part 2, Section I, of the OTC document "Guidance
for the Implementation of Emission Monitoring Requirements for the NOx
Budget Program".

vi. The owner or operator of a non-Part 75 budget source may petition the
Department to use a unit-specific maximum hourly heat input based on the
higher of the manufacturer's rated capacity or the highest observed hourly
heat input in the period beginning five years prior to the program
participation date. The Department may approve a lower maximum heat input
if an owner or operator demonstrates that the highest observed hourly heat
input in the last five years is not representative of the unit's current
capabilities because modifications have been made limiting its capacity
permanently.

vii. Methods used for determination of heat input are
subject to both applicable initial and periodic relative accuracy and
quality assurance testing requirements in accordance with the following
provisions of the OTC document"Guidance for Implementation of Emissions
Monitoring Requirements for the NOx Budget Program":

A. Initial certification requirements identified in Part 2, Section III.

B. Quality assurance requirements identified in Part 2, Section IV.

C. Re-certification requirements identified in Part 2, Section V.

5. Once the NOx emission rate in pounds per million BTU has been determined
in accordance with Section 13(f)(3) of this regulation and the heat input
rate in MMBTU per hour has been determined in accordance with Section
13(f)(4) of this regulation, the two values shall be multiplied together to
result in NOx emissions in pounds per hour and reported to the NETS in
accordance with Section 15 of this regulation.

6. The relevant procedures of the OTC document "Guidance for Implementation
of Emission Monitoring Requirements for the NOx Budget Program" shall be
employed for unusual or complicated stack configurations.

Section 14 - Recordkeeping

The owner or operator of any budget source shall maintain, for a period of
at least five years, copies of all measurements, tests, reports, data, and
other information required by this regulation.

Section 15 - Emissions Reporting

a. The Authorized account representative or alternate authorized account
representative for each budget source shall submit to the NETS
Administrator, electronically in a format which meets the requirements of
the EPA's Electronic Data Reporting (EDR) convention, emissions and
operating information [for the second and third calendar quarter of each
year] in accordance with the OTC documents "Guidance for the Implementation
of Emission Monitoring Requirements for the NOx Budget Program" and "NOx
Budget Program Monitoring Certification and Reporting Instructions".

1. All existing Part 75 budget sources not required to install additional
monitoring equipment shall meet the reporting requirements of the NOx
Budget Program as follows:

i. By meeting all current Part 75 reporting requirements and reporting the
additional unit identification information as required by the NOx Budget
Program (100 and 500 level records) beginning with submittal of the
quarterly report for the third calendar quarter of 1998.

ii. It is not necessary to submit hourly NOx mass
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emissions data in 1998.

iii. Beginning with the quarterly report for the second quarter of 1999,
report all Part 75 required information and all additional information
required by the NOx Budget Program including:

A. Additional unit identification information.

B. Hourly NOx mass emissions in pounds per hour based on reported hourly
heat input and hourly NOx emission rate.

C. Cumulative NOx control period NOx mass emissions in tons per NOx control
period.

D. Additional monitoring plan information related to the NOx Budget
Program.

E. Certification status information as required by the NOx Budget Program.

2. Beginning with the quarterly report for the third quarter of 1998, all
Part 75 budget sources, that are required to install and certify new
monitoring systems to meet the requirements of the NOx Budget Program,
shall meet the reporting requirements of the NOx Budget Program by meeting
all current Part 75 reporting requirements and the additional reporting
requirements of the NOx Budget Program including submittal of the following
information:

i. Additional unit identification information.

ii. Hourly NOx mass emissions in pounds per hour based on reported hourly
heat input and hourly NOx emission rate.

iii. Cumulative NOx control period NOx mass emissions in tons per NOx
control period.

iv. Additional monitoring plan information related to the NOx Budget
Program.

v. Certification status information as required by the NOx Budget Program.

3. All non-Part 75 budget sources shall meet the reporting requirements of
the NOx Budget Program by reporting all information required by the NOx
Budget Program as well as reporting hourly and cumulative NOx mass
emissions beginning with the quarterly report for the third quarter of
1998.

b. The authorized account representative or alternate authorized account
representative of a budget source subject to 40 CFR Part 75 shall submit
NOx Budget Program quarterly data to the U.S. EPA as part of the quarterly
reports submitted for the compliance with 40 CFR Part 75.

c. The authorized account representative or alternate authorized account
representative of a budget source not subject to 40 CFR Part 75 shall
submit NOx budget program quarterly data to the U.S. EPA as follows:

1. For non-Part 75 budget sources not utilizing NOx CEMS, submit two
quarterly reports each year, one for the second quarter and one for the
third quarter.

2. For non-Part 75 budget sources using any NOx CEMS
based measurement methodology, submit a complete quarterly report for each
quarter in the year.

3. The submission deadline is thirty days after the end of the calendar
quarter. If the thirtieth day falls on a weekend or federal holiday, the
reporting deadline is midnight of the first day following the holiday or
weekend.

d. Should a budget source be permanently shutdown, the authorized account
representative or alternate authorized account representative may submit a
written request the Department for an exemption from the requirements of
Sections 13 and 14 of this regulation. The shutdown exemption request shall
identify the budget source being shutdown and the date of permanent
shutdown. Within 30 days of receipt of the shutdown exemption request, the
Department shall:

1. If the Department does not approve the shutdown exemption request, the
authorized account representative shall be notified in writing, including
the reason(s) for not approving the request.

2. If the Department approves the shutdown exemption request:

i. The authorized account representative shall be notified in writing.

ii. The Department shall notify the NETS Administrator of the approved
shutdown request.

Section 16 - End-of Season Reconciliation

a. Allowances may be used for compliance with this program in a designated
compliance year by being in a compliance account as of December 31 of the
subject year, or by being identified in an allowance transfer request that
is submitted by December 31 of the subject year.

b. Each year during the period November 1 through December 31, inclusive,
the authorized account representative or alternate authorized account
representative shall request the NATS Administrator to deduct current year
allowances from the compliance account equivalent to the NOx emissions from
the budget source in the most recent control period. This request shall be
submitted by the authorized account representative or alternate authorized
account representative to the NATS Administrator by not later than December
31. This request shall identify the compliance account of the budget source
and the serial number of each of the allowances to be deducted.

1. Allowances allocated for the current NOx control period may be used
without restriction.

2. Allowances allocated for future NOx control periods may not be used.

3. Allowances which were allocated for any preceding NOx control period
which were banked may be used in the
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current control period. Banked allowance shall be deducted against NOx
emissions in accordance with the ratio of NOx allowances to emissions as
specified in Section 12 of this regulation.

c. If the emissions from a budget source in the current control period
exceed the allowances held in that budget source's compliance account for
that control period:

1. The budget source shall obtain additional allowances by December 31 of
the subject year so that the total number of allowances in the compliance
account meeting the criteria of Section 16(b)(1) through (3) of this
regulation, including allowances identified in any allowance transfer
request properly submitted to the NATS Administrator by December 31 of the
subject year, equals or exceeds the control period emissions of NOx rounded
to the nearest whole ton.

2. If there is an insufficient number of NOx allowances available for NOx
allowance deduction, the source is out of compliance with this regulation
and subject to enforcement action and penalties pursuant to Section 18 of
this regulation.

d. If by the December 31 compliance deadline the authorized account
representative or alternate authorized account representative either makes
no NOx allowance deduction request, or a NOx allowance deduction request
insufficient to meet the allowances required by the actual emissions, a
violation of this regulation may have occurred and the NATS Administrator
may deduct the necessary number of NOx allowances from the budget source's
compliance account. The NATS Administrator shall provide written notice to
the authorized account representative that NOx allowances were deducted
from the source's account.

e. The authorized account representative or alternate authorized account
representative may notify the NATS Administrator of any claim that the NATS
Administrator made an error in recording transfer information that was
submitted in accordance with Section 11 of this regulation, provided that
such claim of error notification is submitted to the NATS Administrator by
no later than 15 business days following the date of the notification by
the NATS Administrator pursuant to actions taken in accordance with Section
16(d) of this regulation.

1. Such claim of error notification shall be in writing and shall include:

i. A description of the error alleged to have been made by the NATS
Administrator.

ii. A proposed correction of the alleged error.

iii. Any supporting documentation or other information concerning the
alleged error and proposed corrective action.

iv. The following statement: "I certify under penalty of law that I have
personally examined, and am familiar with, the statements and information
submitted in this document and all its attachments. Based on my inquiry of
those individuals with primary responsibility for obtaining the
information, I certify that the statements and information are to the best
of my knowledge and belief true, accurate, and complete. I am aware that
there are significant penalties for submitting false statements and
information or omitting required statements and information, including the
possibility of fine or imprisonment."

v. Signature of the authorized account representative or alternate
authorized account representative and date of signature.

2. The NATS Administrator, at the NATS Administrator's sole discretion
based on the documentation provided, shall determine what changes, if any,
shall be made to the account(s) subject to the alleged error. Not later
than 20 business days after receipt of a claim of error notification, the
NATS Administrator shall submit to the authorized account representative
and to the Department a written response stating the determination made,
any action taken by the NATS Administrator, and the reason(s) for the
determination and actions.

3. The NATS Administrator may, without prior notice of a claim of error and
at the NATS Administrator's sole discretion, correct any errors in any
account on the NATS Administrator's own motion. The NATS Administrator
shall notify the authorized account representative and the Department no
later than 20 business days following any such corrections.

Section 17 - Compliance Certification

a. For each NOx allowance control period, the authorized account
representative or alternate authorized account representative of each
budget source shall submit to the Department an annual compliance
certification.

b. The compliance certification shall be submitted no later than December
31 of each year.

c. The compliance certification shall contain, at a minimum, the following
information:

1. Identification of the budget source, including the budget source's name
and address, the name of the authorized account representative and
alternate authorized account representative, if any, and the NATS account
number.

2. A statement indicating whether or not emissions data was submitted to
the NETS Administrator pursuant to Section 15 of this regulation.

3. A statement indicating whether or not the budget
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source held sufficient NOx allowances, as determined in Section 16 of this
regulation, in its compliance account for the NOx allowance control period
as of December 31 of the subject year, or by being identified in an
allowance transfer request that was submitted by December 31 of the subject
year, to equal or exceed the budget source's actual emissions as reported
to the NETS Administrator for the control period.

4. A statement of certification whether the monitoring plan which governs
the budget source was maintained to reflect actual operation and monitoring
of the budget source and contains all information necessary to attribute
monitored emissions to the budget source.

5. A statement of certification that all emissions from the budget source
were accounted for, either through the applicable monitoring or through
application of the appropriate missing data procedures.

6. A statement whether the facts that form the basis for certification of
each monitor or monitoring method approved in accordance with Section 13 of
this regulation have changed.

7. If a change is required to be reported in accordance with Section
17(c)(6) of this regulation, specify the nature of the change, when the
change occurred, and how the budget source's compliance status was
determined subsequent to the change, including what method was used to
determine emissions when a change mandated the need for monitor
re-certification.

8. The following statement in verbatim, "I certify under penalty of law
that I have personally examined, and am familiar with, the statements and
information submitted in this document and all its attachments. Based on my
inquiry of those individuals with primary responsibility for obtaining the
information, I certify that the statements and information are to the best
of my knowledge and belief true, accurate, and complete. I am aware that
there are significant penalties for submitting false statements and
information or omitting required statements and information, including the
possibility of fines or imprisonment."

9. Signature of the budget source's authorized account representative or
alternate authorized account representative and the date of signature.

d. The Department may verify compliance by whatever means necessary,
including but not limited to:

1. Inspection of facility operating records.

2. Obtaining information on allowance deduction and transfers from the NATS
Administrator.

3. Obtaining information on emissions from the NETS Administrator.

4. Testing emission monitoring devices.

5. Requiring the budget source to conduct emissions testing using testing
methods approved by the Department.

Section 18 - Failure to Meet Compliance Requirements

a. If the emissions from a budget source exceed allowances held in the
budget source's compliance account for the control period as of December 31
of the subject year, the NATS Administrator shall deduct allowances from
the budget source's compliance account for the next control period at a
rate of three (3) allowances for every one (1) ton of excess emissions.

1. The NATS Administrator shall provide written notice to the budget
source's authorized account representative that NOx allowances were
deducted from the budget source's account.

2. The authorized account representative or alternate authorized account
representative may notify the NATS Administrator of any claim that the NATS
Administrator made an error in recording submitted transfer information in
accordance with Section 16(e) of this regulation.

b. In addition to NOx allowance deduction penalties under Section 18(a) of
this regulation, the Department may enforce the provisions of this
regulation under 7 Del. C. Chapter 60. For the purposes of determining the
number of days of violation, any excess emissions for the control period
shall presume that each day in the control period (153 days) constitutes a
day in violation unless the budget source can demonstrate, to the
satisfaction of the Department, that a lesser number of days should be
considered.

Section 19 - Program Audit

a. The Department shall conduct an audit of the NOx Budget Program prior to
May 1, 2002, and at a minimum every three years thereafter. The audit shall
include the following:

1. Confirmation of emissions reporting accuracy through validation of NOx
allowance monitoring and data acquisition systems at the budget source.

2. Examination of the extent to which banked allowances have, or have not,
contributed to emissions in excess of the budget for each control period
covered by the audit.

3. An analysis of the geographic distribution of emissions as well as
hourly and daily emission totals in the context of ozone control.

4. An assessment of whether the program is providing the level of emissions
reductions anticipated and included in the SIP.

b. The Department shall prepare a report on the results of the audit. The
Department shall seek public input on the conclusions contained in the
audit report and provide for a public notice, public comment period, and
allow for the request to hold a public hearing on the conclusions contained
in the report.
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c. In addition to the Department audit, the Department may seek a third
party audit of the program. Such an audit could be implemented by the
Department or could be performed on a region-wide basis under the
supervision of the OTC.

d. Should an audit result in recommendations for program revisions at the
state level, the Department shall consider the audit recommendations, in
consultation with the OTC, and if found necessary, propose the appropriate
program revisions as changes to current procedures or modifications to this
regulation.

Section 20 - Program Fees

The authorized account representative or alternate authorized account
representative of each compliance account and each general account shall
pay fees to the Department consistent with the fee schedule established
from time to time by the Delaware General Assembly, should a fee schedule
be established.
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NOX BUDGET PROGRAM --- APPENDIX "A"

COMPANY FACILITY and OTC EXCEPTIONAL RESERVE FINAL SOURCE PLANT POINT
IDENTIFIED CIRCUMSTANCES ALLOWANCES ALLOWANCES TYPE ALLOWANCES ALLOWANCES

DELMARVA

POWER Christiana Sub 001 6 -0- 1 7 Non-Part 75 Christiana Sub 002 6 -0- 1 7
Non-Part 75

Delaware City 002 1 -0- 1 2 Non-Part 75

Edge Moor 001 1 -0- 1 2 Non-Part 75

Edge Moor 002 241 -0- 1 242 Part 75

Edge Moor 003 345 -0- 1 346 Part 75

Edge Moor 004 621 28 1 650 Part 75

Hay Road 001 49 -0- 1 50 Non-Part 75

Hay Road 002 34 -0- 1 35 Non-Part 75

Hay Road 3* -0- -0- -0- -0- Part 75 Indian River 001 340 -0- 1 341 Part 75

Indian River 002 397 -0- 1 398 Part 75

Indian River 003 762 -0- 1 763 Part 75

Indian River 004 1,652 -0- 2 1,654 Part 75

Indian River 10** -0- -0- 1 2 Non-Part 75

Madison Str. 001 -0- -0- 1 1 Non-Part 75

West Sub 001 2 -0- 1 3 Non-Part 75

DFD Operating McKee Run 001 72*** -0- 1 73 Non-Part 75

Services McKee Run 002 44*** -0- 1 45 Non-Part 75

McKee Run 003 184 -0- 2 186 Part 75

VanSant 1* -0- -0- -0- -0- Part 75

FIRST STATE Co-Gen 1** -0- -0- 2 203 Non-part 75

STAR Delaware City 001 93 -0- 1 94 Non-Part 75

ENTERPRISE Delaware City 007** -0- -0- 1 105 Non-Part 75

Delaware City 019 20 -0- 1 21 Non-Part 75

Delaware City 034 70 -0- 1 71 Non-Part 75

Delaware City 068 206 -0- 1 207 Non-Part 75

Delaware City 069 227 -0- 1 228 Non-Part 75

Delaware City 070 214 -0- 2 216 Non-Part 75

Delaware City 074 117 -0- 1 118 Non-Part 75

TOTAL: 5,704 28 32 6,070

NOTES: (*) These Units did not start operation until after 1990.

(**) Units operated in the 1990 NOx control period but were not included in
the "1990 OTC Baseline Emissions Inventory".

(***) OTC MOU allowances corrected from "1990 OTC Baseline Emissions
Inventory" due to use of incorrect RACT factor.
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NOX BUDGET PROGRAM APPENDIX "B"

COMPANY FACILITY 1990 BASELINE 1990 BASELINE 1990 BASELINE RACT

or PLANT POINT HEAT INPUT NOX EMISSIONS EMISSION RATE NOX EMISSIONS

(106 BTU) (Tons) (lb/mmBTU) (Tons)

DELMARVA POWER Christiana Sub 001 16,245 5.8 0.709 5.8 Christiana Sub 002
15,447 5.5 0.709 5.5

Delaware City 002 1,612 0.6 0.703 0.6 Edge Moor 001 1,835 0.7 0.708 0.7

Edge Moor 002 2,409,836 655.8 0.545 648.1

Edge Moor 003 3,451,182 928.7 0.540 516.0

Edge Moor 004 6,213,944 1,436.8 0.463 1,147.3

Hay Road 001 938,341 49.0 0.105 49.0

Hay Road 002 631,111 33.6 0.106 33.6

Hay Road 3* -0- -0- -0- -0- Indian River 001 1,816,612 755.6 0.828 755.6

Indian River 002 2,134,257 882.3 0.828 882.3

Indian River 003 4,521,301 1,853.7 0.819 762.1

Indian River 004 8,747,546 3,671.6 0.838 1,830.8

Indian River 10** -0- -0- -0- -0- Madison Street 001 1,079 0.4 0.706 0.4

West Sub 001 6,105 2.2 0.709 2.2

DFD McKee Run 001 344,472 91.6 0.524 55.0

McKee Run 002 211,742 56.3 0.505 33.8

McKee Run 003 1,724,601 411.7 0.447 321.8

VanSant 1* -0- -0- -0- -0-

FIRST STATE Co-Gen 1** -0- -0- -0- -0-

STAR ENTERPRISE Delaware City 001 931,712 229.0 0.486 116.5

Delaware City 007** -0- -0- -0- -0- Delaware City 019 318,601 20.1 0.126
20.1 Delaware City 034 1,100,470 69.5 0.126 69.5

Delaware City 068 1,820,133 588.5 0.647 345.8

Delaware City 069 2,002,309 647.4 0.647 440.5

Delaware City 070 1,888,905 610.7 0.647 368.3

Delaware City 074 1,847,552 116.7 0.126 116.7
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NOTES: Data as identified in "1990 OTC NOX Baseline Emission Inventory",

Final OTC NOX Baseline Inventory, Point-Segment Level Data.

(*) These Units did not start operation until after 1990.

(**) Indian River Point 10, First State Co-Gen 1, and Delaware City 007
were not included in the Reference Document, but were operating in the 1990
NOX control period.
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GOVERNOR'S APPOINTMENTS
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TERM OF OFFICE
BOARD/COMMISSION

OFFICE
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APPOINTEE
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Architectural Accessibility Mr. Abdul G. Qaissaunee 01/09/00

Board

Board of Chiropractic Dr. Trent Camp 01/09/01

Board of Examiners of Private Ms. Patricia Beetschen 01/09/01

Investigators and Security Mr. Robert C. Shannon 01/09/01

Agencies

Board of Dental Examiners Dr. Connie F. Cicorelli 01/09/01

Dr. Thomas E. Conley 01/09/01

Board of Registration of Ms. Elizabeth K. Brown 01/09/00

Geologists Dr. Robert Jordan 01/09/00

Mr. Bangladore T. Lakshman 01/09/00

Board of Podiatry Examiners Dr. Luis Garcia 01/09/01

Council on Banking Mr. Robert Dickerson 12/30/00

Council on Correction Ms. Dian Taylor 12/15/00

Council on Volunteer Services Ms. Alice B. Barron 01/09/00

Mr. James V. Healy 01/09/00

Council on Aging and Adults Ms. C. Regina Byers 01/09/01

with Physical Disabilities

Council on Hispanic Affairs Mr. Rodolfo A. Alfonso 01/09/01

Mr. Efrain Lozano, Jr. 01/09/01

Ms. Maria M. Matos 01/09/01

Dr. Jaime H. Rivera 01/09/01

Mr. Israel F. Valenzuela 01/09/01

Council on Libraries Ms. Janet Mee-Ling Chin 12/30/00

Mr. James P. Neal 09/26/98

Council on Housing and Mr. Don C. Brown 03/20/99

Community Development
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Delaware Private Industry Ms. Janet L. Abrams 12/30/00

Council Ms. Elaine Archangelo 12/30/00 Mr. John C. Castle 12/30/00 Ms.
Alice Coleman 12/30/00

Mr. Clifford Crouch 12/30/00

Ms. Muriel E. Gilman 12/30/00

Ms. Kathleen Ittel 12/30/00

Mr. Michael E. Kozikowski, Sr. 12/30/00

Mr. Samuel E. Lathem 12/30/00

Dr. Dennis L. Loftus 12/30/00

Mr. John McMahon, Jr. 01/09/01

The Honorable Darrell Minott 12/30/00

Mr. Vance Morris 12/30/00

Mr. James P. Neal 12/30/00

Mr. George Pennington 12/30/00

Mr. Benjamin T. Shaw 01/09/01

Mr. Dana S. Shreve 01/09/01

Mr. Duane L. Wayman, II 12/30/00

Delaware Institute of Medical Dr. John J. Forest, Jr. 12/30/00

Education and Research

Governor's Council on Mr. Robert L. Baker 12/30/00

Agriculture

Health Resources Council Mr. S. Bernard Ableman 01/05/01

Dr. Steven Edell 01/10/01

Dr. Larcy D. McCarley 01/05/01

Ms. Terri Nicholau 12/30/00

Ms. Phyllis A. Sheppard, Chairperson 12/30/00

Dr. Gregg C. Sylvester 12/30/00

Historical Records Advisory Ms. Jean K. Brown 12/10/00

Board Mr. Robert C. Moor, Jr. 12/30/00

Interagency Coordinating The Honorable Patricia M. Blevins 01/09/01

Council Ms. Cynthia S. Miller 01/09/01

Ms. Christine M. Long 01/09/01

Ms. Louann Vari 01/09/01

Interagency Coordinating Ms. Ann Woolfolk 01/09/01

Council

State Examining Board of Mr. Bruce A. Goldsborough 01/09/01

Physical Therapists
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State Committee of Ms. Ruth Ann Messick 12/30/00

Dietetics/Nutritionists

State Board of Accountancy Mr. Paul C. Seitz 01/09/01

Statewide Independent Ms. Elva Vandever 01/09/01

Living Council

WILMAPCO Council Mr. Robert W. Coy

Worker's Compensation Mr. John S. Bonk 12/10/00

Advisory Council Mr. Clifford B. Hearn, Jr. 12/10/00

Mr. George B. Heckler, Jr. 12/10/00

Mr. A. Richard Heffron 12/10/00

Mr. James Johnson 12/10/00

The Honorable Robert I. Marshall 12/10/00

Mr. William J. McCloskey 12/10/00

The Honorable William A. Oberle, Jr. 12/10/00

Mr. Joseph J. Rhoades 12/10/00

Ms. Karen W. Wright 12/10/00

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Department of Administrative Services

Division of Professional Regulation

Delaware Board of Examiners of Psychologists

Statutory Authority: 24 Delaware Code,

Section 3506(a)(1) (24 Del.C. 3506(a)(1))

DELAWARE BOARD OF EXAMINERS OF PSYCHOLOGISTS

NOTICE OF PUBLIC HEARING

PLEASE TAKE NOTICE, pursuant to 29 Del. C. Chapter 101 and 24 Del. C.
Section 3506(a)(1), the Delaware Board of Examiners of Psychologists
proposes to repeal the existing Rules and Regulations and adopt the new
Rules and Regulations. The regulations will define the official board
office, meetings of the board, officers of the board, procedures for
licensure, evaluation of credentials, supervised experience, failure to
pass examination, psychological assistants, continuing education,
professional conduct, complaint procedures, license renewal and procedures
for licensure applicable to full-time faculty members in a nationally
accredited doctoral level clinical training program in the State of
Delaware.

A public hearing will be held on the proposed Rules and Regulations on
March 9, 1998 at 9:30 a.m. in the Second Floor Conference Room A of the
Cannon Building, 861 Silver Lake Boulevard, Dover, Delaware. The Board will
receive and consider input from interested persons on the proposed rules
and regulations, and individuals are urged to submit their comments in
writing. Anyone wishing to obtain a copy of the proposed regulations, or to
make comments at the public hearing, should contact the Board's
Administrative Assistant Gayle Franzolino by calling (302) 739-4522 Ext.
220, or write to the Delaware Board of Examiners of Psychologists, P. O.
Box 1401, Cannon Building, Suite 203, Dover, DE 19903.
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Delaware Real Estate Commission

The Delaware Real Estate Commission will hold a public hearing for the
purpose of receiving oral or written comment on the proposed revision to
the Rules and Regulations as well as the proposed revision to the Sellers
Disclosure of Real Property Condition Report. The hearing will be scheduled
for March 12, 1998 at 9:00 a.m. in Conference Room A of the Cannon
Building, 861 Silver Lake Boulevard, Dover,Delaware. Those who wish to
submit written comment may send in care of the Delaware Real Estate
Commission, 861 Silver Lake Boulevard, Suite 203, Dover, DE 19904-2467.

Delaware Council on Real Estate Appraisers

The Delaware Council on Real Estate Appraisers a subcommittee of the
Delaware Real Estate Commission, will hold a public hearing for the purpose
of receiving oral or written comment on the proposed revision to the Rules
and Regulations. The hearing will be scheduled for March 17, 1998 at 9:30
a.m. in Conference Room A of the Cannon Building, 861 Silver Lake
Boulevard, Dover, Delaware. Those who wish to submit written comment may
send in care of the Delaware Council on Real Estate Appraisers, 861 Silver
Lake Boulevard, Suite 203, Dover, DE 19904-2467.

Delaware Board of Medical Practice

Respiratory Care Practice

Advisory Council

PLEASE TAKE NOTICE that the Respiratory Care Practice Advisory Council to
the Delaware Board of Medical Practice, pursuant to the authority of Title
24, Delaware Code, § 1770B(c)(5), has developed and proposes to promulgate
Rules and Regulations governing all aspects of the practice of Respiratory
Care by licensed respiratory care practitioners in the State of Delaware.

A public hearing will be held on the proposed Rules and Regulations on
Thursday, March 5, 1998, at 2:30 p.m., at the Cannon Building, 861 Silver
Lake Boulevard, conference room B, Dover, Delaware, 19901. The Council will
receive and consider input in writing from interested persons on the
proposed new Rules and Regulations. Final date to submit written comments
shall be at the above scheduled public hearing. Anyone wishing to obtain a
copy of the proposed Rules and Regulations or to make comments at the
public hearing should notify Rosey Vanderhoogt at the above address or by
calling (302) 739-4522 extension 203.

This notice will be published in two newspapers of general circulation not
less than twenty (20) days prior to the date of the hearing.
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Department of Education

The State Board of Education will hold its monthly meeting on February 19,
1998

Department of Finance

Division of Revenue

Office of the State Lottery

The Lottery proposes these rules pursuant to 29 Del.C. §§ 4805(a),
4805(a)(24)(f), 4805(25) and 29 Del.C. § 10115. Proposed rules 3.2(4),
3.2(9), 3.2(12), 4.2(10)(ii, 4.2(13), 4.2(15), and 4.2(17) would clarify
the background investigation requirements for employee organizations and
key employees. Proposed rule 6.1 would clarify the background investigation
requirements for Lottery employees. Copies of the proposed rules may be
obtained from the Lottery Office. Comments may be submitted in writing to
Donald Johnson, at the Lottery Office on or before 4:00 p.m. on March 3,
1998. The Lottery Office is located at 1575 KcKee roa, Suite 102, Dover, DE
19901 and the phone number is (302) 739-5291.

Division of Revenue

PROPOSED TECHNICAL INFORMATION MEMORANDUM 98-1

SUBJECT: "CHECK THE BOX" REGULATIONS

Public Comment shall run from February 1, 1998 through March 3, 1998 and
comments must be received by March 3, 1998. Comments shall be made in
writing to John Maciejeski, whose address appears at the conclusion of this
Memorandum.

Purpose of Regulation -- The purpose of this regulation is to explain the
relationship between the classification of organizations for federal and
state tax purposes and the procedures for electing entity classification.

Department of Health &

Social Services

Division of Social Services

PUBLIC NOTICE

Medicaid / Medical Assistance Program

In compliance with the State's Administrative Procedures Act (APA - Title
29, Chapter 101 of the Delaware Code) and with 42CFR §447.205, the Delaware
Department of Health and Social Services (DHSS) Division of Social
Services/Medical Assistance Program (DMAP) hereby publishes notice of
proposed policy amendments several Medicaid provider manuals including the
General Policy Manual, the Long-Term Care Provider Manual, the
Non-Emergency Transportation Provide Manual, the Home and Community-Based
Services Provider Manual, the Hospice Provider Manual, the Practitioner
Provider Manual, and the Independent Laboratory Provider Manual.

Comments or requests for copies of proposed changes or relevant materials
may be made in writing to: Medicaid Administrative Offices, Division of
Social Service, P.O. Box 906, New Castle, DE 19720, attention: Thelma G.
Mayer, or by calling (302) 577-4880, extension 131, or may be viewed at the
following locations: New Castle County: Medicaid Office, Lewis Bldg.,
Herman M. Holloway, Sr. Health & Social Services Campus, 1901 N. DuPont
Hwy., New Castle, DE, 19720; Kent County: Medicaid Unit, Division of Social
Services, Williams State Service Center, 805 River Rd., Dover, DE 19901;
Sussex County: Medicaid Unit, Division of Social Services, Georgetown State
Service Center, 546 S. Bedford St., Georgetown, DE, 19947. Comments,
written suggestions, compilations of data, testimony, briefs or other
written materials concerning the proposed change must be received by mail
no later than March 1, 1998, at the Medicaid Administrative Office, Lewis
Bldg., Herman M. Holloway, Sr. Health & Social Services Campus, 1901 N.
DuPont Hwy., New Castle, DE 19720, attention Thelma Mayer. Materials filed
thereafter will not be considered except where good cause for lateness is
demonstrated. Copies of all written submissions filed with the Medicaid
office will be available for public inspection in the Medicaid
Administrative Office at the address given above. Please call (302)
577-4800, ext.131 for an appointment if you wish to review the materials.
Individuals with disabilities who wish to participate in these proceedings,
or review the materials submitted, should contact the Division to discuss
auxiliary aids or services needed to facilitate such review or
participation. Such contact may be in person, in writing or by telephone by
using the Telecommunications Relay Service, or otherwise.
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Division of Social Services

PUBLIC NOTICE

Medicaid / Medical Assistance Program

In compliance with the State's Administrative Procedures Act (APA - Title
29, Chapter 101 of the Delaware Code) and with 42CFR §447.205, the Delaware
Department of Health and Social Services (DHSS) Division of Social
Services/Medical Assistance Program (DMAP) hereby publishes notice of
proposed policy amendments to the Medicaid eligibility policy manual
reflecting changes made to the program as a result of the Personal
Responsibility and Work Opportunity Reconciliation Act of 1996, P.L.
104-193 (PRWORA) and changes to coverage for aliens mandated by PRWORA and
new coverage for some aliens funded by the State.

Comments or requests for copies of proposed changes or relevant materials
may be made in writing to: Medicaid Administrative Offices, Division of
Social Service, P.O. Box 906, New Castle, DE 19720, attention: Thelma G.
Mayer, or by calling (302) 577-4880, extension 131, or may be viewed at the
following locations: New Castle County: Medicaid Office, Lewis Bldg.,
Herman M. Holloway, Sr. Health & Social Services Campus, 1901 N. DuPont
Hwy., New Castle, DE, 19720; Kent County: Medicaid Unit, Division of Social
Services, Williams State Service Center, 805 River Rd., Dover, DE 19901;
Sussex County: Medicaid Unit, Division of Social Services, Georgetown State
Service Center, 546 S. Bedford St., Georgetown, DE, 19947. Comments,
written suggestions, compilations of data, testimony, briefs or other
written materials concerning the proposed change must be received by mail
no later than March 1, 1998, at the Medicaid Administrative Office, Lewis
Bldg., Herman M. Holloway, Sr. Health & Social Services Campus, 1901 N.
DuPont Hwy., New Castle, DE 19720, attention Thelma Mayer. Materials filed
thereafter will not be considered except where good cause for lateness is
demonstrated. Copies of all written submissions filed with the Medicaid
office will be available for public inspection in the Medicaid
Administrative Office at the address given above. Please call (302)
577-4800, ext.131 for an appointment if you wish to review the materials.
Individuals with disabilities who wish to participate in these proceedings,
or review the materials submitted, should contact the Division to discuss
auxiliary aids or services needed to facilitate such review or
participation. Such contact may be in person, in writing or by telephone by
using the Telecommunications Relay Service, or otherwise.

Department of Justice

Delaware Securities Act

NOTICE OF ISSUANCE OF

PROPOSED RULES AND REGULATIONS

PURSUANT TO THE DELAWARE SECURITIES ACT

The Securities Commissioner is issuing for notice and comment proposed
rules and regulations pursuant to the Delaware Securities Act. The proposed
rules and regulations are intended to replace the current regulations and
cover the following subject areas:

A. Organization and Functions of the Securities Division

B. Practice and Procedure in Administrative Hearings

C. Investigations

D. Securities Registration and Notice Filings

E. Exemptions from Registration

F. Broker-Dealers, Broker-Dealer Agents and Issuer Agents

G. Investment Advisers and Investment Adviser Representatives

The proposed rules and regulations are issued pursuant to the authority
granted in 6 Del. C. §§7306(a)(17), 7307, 7309(b)(2), 7309(b)(9), 7309(c),
7309A(f), 7312, 7314(b)(4), 7317(c) and 7325(b).

Comments may be presented in writing to the attention of Charles F. Walker,
Securities Commissioner, State of Delaware Department of Justice, 820 N.
French Street, Wilmington, Delaware, 19801. Comments must be received no
later than 5:00 p.m. on March 5, 1998, for consideration.

DEPARTMENT OF LABOR

Division of Employment & Training

Governor's Advisory Council on Apprenticeship and Training

Notice of Proposed Rule Changes:

Summary:

The Governor's Council on Apprenticeship and Training proposes to recommend
rule changes at its regular meeting on March 10, 1998 at Buena Vista
Conference Center 661 South Dupont Highway, New Castle, DE 19720. Changes
are proposed to certain definitions in Sec. 106.2 including Administrator,
Apprentice, Full time, Apprenticeship Standards, Council,
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Delaware resident contractor, On-site visit, Registrant or sponsor, and
Registration Supervisory inspection. In addition, changes are proposed to
Sec. 106.3, 106.5, 106.6, 106.7

Comments:

Copies of the proposed rules are published in the Delaware Register of
Regulation and are on file at the Department of Labor, Division of
Employment and Training, 4425 N. Market Street, Wilmington, DE 19802 for
inspection during regular business hours. Copies are available upon request
without charge. Interested persons may submit comments in writing to the
Governor's Advisory Council on Apprenticeship and Training c/o Walt
Purzycki at the Department of Labor, Division of Employment and Training.

Public Hearing:

A public hearing on the changes will be held during the regular meeting of
the Council at 10:00 a.m. on March 10, 1998 at Buena Vista Conference
Center, 661 South Dupont Highway, New Castle, DE where interested persons
can present their views.

Department of Natural Resources & Environmental Control

Division of Air & Waste Management

Statutory Authority: 7 Delaware Code,

Section 6010 (7 Del.C. §6010)

1. TITLE OF THE REGULATIONS: Transportation Conformity - Regulation 32

2. BRIEF SYNOPSIS OF THE SUBJECT, SUBSTANCE AND ISSUES: Transportation
Conformity - Regulation 32. In keeping with the provisions of the Clean Air
Act, this regulation ensures that the State of Delaware's transportation
plans, programs and projects that get Federal money or approval conform to
the goals of the State Implementation Plan (SIP) to reduce auto emissions.
The proposed regulation requires that every time the State plans a project
that impacts air quality, an analysis must be done to determine if that
project will increase pollution over the amount predicted in the State
Implementation Plan, mentioned above.

Delaware's original proposed transportation conformity regulation was
presented for public hearing in November 1994. However, Delaware's
regulation was not adopted at
that time. Delaware's Transportation Conformity Regulation is modeled after
the federal guidelines and the federal guidelines have changed numerous
times since it was first proposed. Now that the federal rules are final, we
are proceeding with the development of Delaware's regulation.

3. POSSIBLE TERMS OF THE AGENCY ACTION: N/A

4. STATUTORY BASIS OR LEGAL AUTHORITY TO ACT:

7 Del. C. Chapter 60 Section 6010

Clean Air Act Amendments of 1990

5. OTHER REGULATIONS THAT MAY BE AFFECTED BY THE PROPOSAL:

6. NOTICE OF PUBLIC COMMENT: Public hearing to be held February 17, 1998 -
DNREC Auditorium, 89 Kings Highway, Dover DE, beginning at 5:00 p.m. For
further information, please contact Phil Wheeler at 739-4791

INDUSTRIAL ACCIDENT BOARD

The Industrial Accident Board proposes to adopt or amend Rule nos. 8, 9,
30, and 31 at its regular meeting on March 10, 1997 at 11:00 at the Hearing
Room of the Board, First Federal Plaza, 710 King Street, Wilmington, DE.

The change in Board Rule 8 will require a party to submit an opinion to the
Board when relying on said opinion at the time of a hearing. The change in
Board Rule 9 is intended to improve the pretrial process to insure timely
filing of the pretrial memorandum identifying and narrowing issues. It will
also bring the pretrial process into conformance with the Workers'
Compensation Statute as amended by Senate Bill 147. Proposed Rule 30 will
prohibit interrogatories except in unusual circumstances: Proposed Rule 31
will require employers to state the reason(s) for requesting certain
medical procedures prior to the payment of compensation benefits.

Comments:

Copies of the proposed rules are published in the Delaware Register of
Regulations and are on file at the Department of Labor, Division of
Industrial Affairs, 4425 North Market Street, Wilmington, DE 19802 for
inspection during regular hours. Copies are available upon request.
Interested persons may submit comments in
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writing before March 2, 1998 to the Industrial Accident Board, c/o the
Division of Industrial Affairs.

Public hearing:

A public hearing on the changes will be held during the regular meeting of
the Industrial Accident Board at 11:00 a.m. on March 10, 1998 at the
Hearing Room of the Board, First Federal Plaza, 710 King Street, Wilmington
DE where interested persons can present their views.

INSURANCE DEPARTMENT

Regulation No. 47

INSURANCE COMMISSIONER DONNA LEE H. WILLIAMS hereby gives notice that a
PUBLIC HEARING will be held on Monday, February 23, 1998 at 10:00 a.m. in
the second floor Conference Room of the Delaware Insurance Department at
841 Silver Lake Boulevard, Dover, Delaware 19904.

The purpose of the Hearing is to solicit comments from the industry, the
agent community, and the general public on Insurance Department Regulation
No. 47 regarding education for insurance agents, brokers, surplus lines
brokers, and consultants.

The hearing will be conducted in accordance with the Delaware
Administrative Procedures Act, 29 Del.C. Chapter 101. Comments are being
solicited from any interested party. Comments may be in writing or may be
presented orally at the hearing. Written comments must be received by the
Department of Insurance no later than Friday, February 13, 1998 and should
be addressed to Fred A. Townsend, III, Deputy Insurance Commissioner, 841
Silver Lake Boulevard, Dover, Delaware 19904. Those wishing to testify or
those intending to provide oral testimony must notify Fred A. Townsend, III
at 302-739-4251, ext. 171 or 800-282-8611 no later than Friday, February
13, 1998.

Regulation No. 63

INSURANCE COMMISSIONER DONNA LEE H. WILLIAMS hereby gives notice that a
PUBLIC HEARING will be held on Thursday, February 26th, 1998 at 10:00 a.m.
in the 2nd Floor Conference Room of the Delaware Insurance Department at
841 Silver Lake Boulevard, Dover, DE 19904.

The purpose of the Hearing is to solicit comments from the industry, the
agent community, and the general public
on the agent community's request to strike the cap on agent commissions
from Insurance Department Regulation 63,

The hearing will be conducted in accordance with the Delaware
Administrative Procedures Act, 29 Del. C. Chapter 101. Comments are being
solicited from any interested party. Comments may be in writing or may be
presented orally at the hearing. Written comments must be received by the
Department of Insurance no later than Thursday, February 19, 1998 and
should be addressed to Fred A. Townsend, III, Deputy Insurance
Commissioner, 841 Silver Lake Boulevard, Dover, DE 19904. Those wishing to
testify or those intending to provide oral testimony must notify Fred A.
Townsend, III at 302.739.4251, ext. 171 or 800.282.8611 no later than
Thursday, February 19, 1998.

Violent Crimes

Compensation Board

NOTICE IS HEREBY GIVEN THAT THE VIOLENT CRIMES COMPENSATION BOARD (VCCB)
WILL HOLD A PUBLIC HEARING ON WEDNESDAY, FEBRUARY 25, 1998 AT DEL TECH
COMMUNITY COLLEGE, TERRY CAMPUS, DOWNES LECTURE HALL AT 7:00 P.M. TO ADOPT
A NEW REGULATION ENTITLED "MENTAL HEALTH PRACTITIONERS, QUALIFICATIONS,
LICENSURE" AND TO MAKE NON-SUBSTANTIVE CHANGES TO EXISTING REGULATIONS.

SHOULD YOU HAVE ANY QUESTIONS, PLEASE FEEL FREE TO CONTACT THE OFFICE AT
995-8383.
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