EDMUND G. BROWN, JR., GOVERNOR OFFICE OF ADMINISTRATIVE LAW REGISTER 2018, NO. 42−Z PUBLISHED WEEKLY BY THE OFFICE OF ADMINISTRATIVE LAW OCTOBER 19, 2018 PROPOSED ACTION ON REGULATIONS TITLE 3. DEPARTMENT OF PESTICIDE REGULATION Pest Control Aircraft Pilot Certification — Notice File No. Z2018−1002−12 .............................. 1835 TITLE 4. CALIFORNIA HORSE RACING BOARD Out−of−Competition Testing — Notice File No. Z2018−1005−01 ....................................... 1838 TITLE 10. DEPARTMENT OF INSURANCE Gender Non−Discrimination in Automobile Insurance Rating — Notice File No.

Z2018−1009−04 ............. 1844 TITLE 13. CALIFORNIA HIGHWAY PATROL Explosives Routes and Stopping Places — Notice File No. Z2018−1004−02 ............................... 1849 TITLE 15. DEPARTMENT OF CORRECTIONS AND REHABILITATION Release — Notice File No. Z2018−1001−01 ........................................................ 1851 TITLE 22. DEPARTMENT OF PUBLIC HEALTH Medical Information Breach — Notice File No. Z2018−1009−01 ....................................... 1854 TITLE 22. DEPARTMENT OF PUBLIC HEALTH Skilled Nursing Facilities 3.5 Direct Care Hours — Notice File No.

Z2018−1004−03 ....................... 1857 GENERAL PUBLIC INTEREST DEPARTMENT OF DEVELOPMENTAL SERVICES Notice of Extension of Written Comment Period Concerning Early Intervention Services (Previously Published in Notice Register 2018, No. 37−Z) ............................................. 1860 DEPARTMENT OF DEVELOPMENTAL SERVICES Notice of Extension of Written Comment Period Concerning Speech−Language Pathology Assistants (Previously Published in Notice Register 2018, No. 38−Z) ............................................. 1861 (Continued on next page) Time- Dated Material

DEPARTMENT OF FISH AND WILDLIFE California Endangered Species Act Consistency Determination No. 2080−2018−009−05, Laguna County Sanitation District Facilities Construction, Operation, and Maintenance Project, Western Santa Maria Valley, Santa Barbara County, California ........................................ 1861 RULEMAKING PETITION DECISIONS DEPARTMENT OF CORRECTIONS AND REHABILITATION Notice of Decision on Petition from Lonnie Lee Poslof Concerning Non−Designation of Classification for Enhanced Outpatient Program Inmates ........................................................... 1865 DEPARTMENT OF PUBLIC HEALTH Notice of Decision on Petition from Deborah Rotenberg Concerning Application Required ................... 1866 A V AILABILITY OF INDEX OF PRECEDENTIAL DECISION BOARD OF PHARMACY Annual Notice of Availability of Precedential Decisions Index .......................................... 1867

SUMMARY OF REGULATORY ACTIONS Regulations filed with the Secretary of State ........................................................ 1867 Sections Filed, May 9, 2018 to October 10, 2018 .................................................... 1869 The California Regulatory Notice Register is an official state publication of the Office of Administrative Law containing notices of proposed regulatory actions by state regulatory agencies to adopt, amend or repeal regulations contained in the California Code of Regulations.

The effective period of a notice of proposed regulatory action by a state agency in the California Regulatory Notice Register shall not exceed one year [Government Code § 11346.4(b)]. It is suggested, therefore, that issues of the California Regulatory Notice Register be retained for a minimum of 18 months. CALIFORNIA REGULA TORY NOTICE REGISTER is published weekly by the Office of Administrative Law, 300 Capitol Mall, Suite 1250, Sacramento, CA 95814-4339. The Register is printed by Barclays, a subsidiary of West, a Thomson Reuters Business, and is offered by subscription for $205.00 (annual price).

To order or make changes to current subscriptions, please call (800) 328−4880. The Register can also be accessed at http://www.oal.ca.gov.

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z PROPOSED ACTION ON REGULATIONS Information contained in this document is published as received from agencies and is not edited by Thomson Reuters. TITLE 3. DEPARTMENT OF PESTICIDE REGULATION Pest Control Aircraft Pilot Certification DPR Regulation No. 18−003 The Department of Pesticide Regulation (DPR) pro- poses to amend sections 6502 and 6540 of Title 3, Cali- fornia Code of Regulations (3 CCR).

The proposed ac- tion will amend forms, Aircraft Pilot Pest Control Cer- tificate Application DPR−PML−005 (Rev. 01/18) and Individual License/Certificate Renewal Application DPR−PML−141 (REV . 6/15), incorporated by refer- ence, to make them consistent with the recently amend- ed state law, Food and Agricultural Code (FAC) sec- tions 11901, 11902, 11905, and 11910. Proposed changes to the forms will differentiate Manned and Un- manned Pest Control Aircraft Pilot certificates and add the subcategory of Vector Control Technician.

The In- dividual License/Certificate Renewal Application is al- so used by pest control advisers, qualified applicators, and dealer designated agents. The proposed action will also update pilot supervision requirements to clarify that manned aircraft apprentice pilots must be super- vised by a manned aircraft journeyman pilot and obtain their required apprentice hours operating a manned air- craft in pest control. Copies of these forms are included in the rulemaking file and are available upon request.

SUBMITTAL OF COMMENTS Any interested person may present comments in writ- ing about the proposed action to the agency contact per- son named below. Written comments must be received no later than 5:00 p.m. on December 3, 2018. Com- ments regarding this proposed action may also be trans- mitted via e−mail to <dpr18003@cdpr.ca.gov> or by facsimile at 916−324−1491. A public hearing is not scheduled.

However, one will be scheduled if any interested person submits a written request to DPR no later than 15 days prior to the close of the written comment period. 1 EFFECT ON SMALL BUSINESS DPR has determined that the proposed regulatory ac- tion does affect small businesses. INFORMATIVE DIGEST/POLICY STATEMENT OVERVIEW DPR protects human health and the environment through the regulation of pesticide sales and use, and by fostering reduced−risk pest management.

DPR’s strict oversight begins with product evaluation and registra- tion; and continues through statewide licensing of com- mercial and private applicators, pest control businesses, and consultants; environmental monitoring; and residue testing of fresh produce. This statutory scheme is set forth primarily in FAC Divisions 6 and 7. DPR’s Licensing and Certification Program administers ex- aminations and licenses, certifies pest control dealer designated agents, qualified applicators, agricultural pest control advisers, and pilots operating in pest con- trol.

The Licensing and Certification Program also li- censes pest control businesses, including maintenance gardener pest control businesses, pest control dealers, and pesticide brokers. DPR must ensure that people selling, possessing, storing, handling, applying, and recommending the use of pesticides are knowledgeable in their safe use.

Currently, the Pest Control Aircraft Pilot Certificate (Certificate) covers all pilots operating any aircraft in pest control, including: pilots employed by a licensed pest control business, pilots employed by vector control agencies or districts, and pilots who perform pest con- trol on their own property. The current application for a Certificate, Aircraft Pilot Pest Control Certificate Ap- plication DPR−PML−005 (Rev. 01/18), incorporated by reference within 3 CCR

section 6502, requires sub- mission of a valid Federal Aviation Administration (FAA) Commercial Pilot’s Certificate and a current Medical Certificate issued by the FAA. Both are specif- ic to flying a manned aircraft. Additionally, Individual License/Certificate Renew- al Application DPR−PML−141 (REV . 6/15), incorpo- rated by reference within 3 CCR

section 6502, is cur- rently required when pest control aircraft pilots, and certain other individuals, apply for renewal of their li- cense. This form requires pilots to submit a copy of their valid medical certificate issued by the FAA, a document 1 If you have special accommodation or language needs, please include this in your request for a public hearing. TTY/TDD speech−to−speech users may dial 7−1−1 for the California Relay Service. 1835

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z specific to operating a manned aircraft. Furthermore, existing 3 CCR

section 6540 describes the requirements for journeyman pilots supervising apprentice pilots and allows a journeyman pilot to supervise an apprentice pi- lot regardless of whether they are manned or unmanned aircraft pilots. Recently, Assembly Bill 527 (Caballero) (Chapter 404, Statutes of 2017) amended the law to set new and more appropriate criteria for the operation of unmanned aircraft systems (UAS) in pest control. As amended, the law requires a person operating a manned aircraft in pest control to hold a Manned Certificate.

Additionally, it is unlawful to operate UAS in pest control unless the pilot holds either a Manned or Unmanned Certificate from DPR. The operators of UAS in pest control must be FAA certified or otherwise authorized by the FAA to operate UAS approved by the FAA to conduct pest con- trol. Finally, after a hearing, the Director may refuse to issue a Certificate for specified reasons including, if the person is not qualified, does not hold the required cer- tificate or authorization from the FAA, or has violated state or federal law (FAC

section 11910). Assembly Bill 527 also added an additional certifica- tion category for the Unmanned Aircraft Pilot Certifi- cate: Vector Control Technician. The ‘Vector Control Technician’ designation requires the applicant to hold a certification by the Department of Public Health in Mosquito Control pursuant to Health and Safety Code

section 2052(1)(

a) prior to taking the Unmanned Air- craft Pilot Vector Control Technician certification ex- amination administered by DPR. The Vector Control Technician applicant must pass the DPR examination demonstrating their ability to legally and safely conduct aerial pest control operations before a Certificate is is- sued (FAC

section 11905). The recent changes to statute require DPR to revise the Aircraft Pilot Pest Control Certificate Application form DPR−PML−005 (REV . 01/18) and the Individual License/Certificate Renewal Application form DPR− PML−141 (REV. 6/15). To ensure that manned aircrafts continue to be operated safely in pest control, DPR also proposes to make changes to the requirements for ap- prentice pilot supervision set in 3 CCR

section 6540. While additional Certificate types will be offered, the fees associated with new applications and examinations are not changing. Allowing pilots to operate UAS in pest control is not new; DPR is simply differentiating between manned and unmanned aircraft pilots as is con- sistent with state law. The applicant requirements for unmanned aircraft pilots operating in pest control will be more appropriate by requiring they meet the FAA mandates for the operation of UAS in pest control. Adoption of this regulation will provide a benefit to public health and the environment.

It will increase pro- tection of residents, workers, and the environment by ensuring that all pilots meet FAA and state requirements for operating aircrafts by demonstrating the safe opera- tion of UAS in pest control. During the process of developing this regulation, DPR conducted a search of any similar regulations on this topic and concluded that the proposed regulation is not inconsistent or incompatible with existing state reg- ulations. DPR is the only agency that has the authority to regulate the sale and use of pesticides.

Incorporated by Reference Forms: Pest Control Aircraft Pilot Certificate Application, DPR−PML−005 (Rev. 07/18) Individual License/Certificate Renewal Application, DPR−PML−141 (Rev. 07/18) IMPACT ON LOCAL AGENCIES OR SCHOOL DISTRICTS DPR determined that the proposed regulatory action does not impose a mandate on local agencies or school districts. DPR also determined that there are no costs to any local agency or school district requiring reimburse- ment pursuant to Government Code

section 17500 et seq. There are no other nondiscretionary costs or sav- ings imposed upon local agencies that are expected to result from the proposed regulation action. COSTS OR SA VINGS TO STATE AGENCIES DPR determined that no savings or increased costs to any state agency will result from the proposed regulato- ry action. EFFECT ON FEDERAL FUNDING TO THE STATE DPR determined that no costs or savings in federal funding to the state will result from the proposed action. EFFECT ON HOUSING COSTS DPR made an initial determination that the proposed action will have no effect on housing costs.

SIGNIFICANT STATEWIDE ADVERSE ECONOMIC IMPACT DIRECTLY AFFECTING BUSINESSES DPR has made an initial determination that adoption of this regulation will not have a significant statewide adverse economic impact directly affecting businesses, including the ability of California businesses to com- pete with businesses in other states. COST IMPACTS ON REPRESENTATIVE PRIV ATE PERSONS OR BUSINESSES DPR is not aware of any cost impacts that a represen- tative private person or business would necessarily in- 1836

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z cur in reasonable compliance with the proposed action because a private person or business can already oper- ate UAS in pest control with the current Aircraft Pilot Pest Control license.

RESULTS OF THE ECONOMIC IMPACT ANALYSIS Impact on the Creation, Elimination, or Expansion of Jobs/Businesses: DPR determined it is not likely the proposed regulatory action will impact the creation or elimination of jobs, the creation of new businesses or the elimination of existing businesses, or the expansion of businesses currently doing business with the State of California. Adopting this regulation will benefit public health and the environment.

It will increase protection of resi- dents, workers, and the environment by ensuring that all pilots meet FAA and State requirements for operating aircrafts by demonstrating the safe operation of UAS in pest control.

CONSIDERATION OF ALTERNATIVES DPR must determine that no reasonable alternative considered by the agency, or that has otherwise been identified and brought to the attention of the agency, would be more effective in carrying out the purpose for which the action is proposed, would be as effective and less burdensome to affected private persons than the proposed regulatory action, or would be more cost− effective to affected private persons and equally effec- tive in implementing the statutory policy or other provi- sion of the law.

AUTHORITY This regulatory action is taken pursuant to the author- ity vested by FAC sections 11456 and 11502.5. REFERENCE This regulatory action is to implement, interpret, or make specific FAC sections 11502.5, 11703, 11707, 11903, 11904, 11908, and 11909. A V AILABILITY OF STATEMENT OF REASONS AND TEXT OF PROPOSED REGULATIONS DPR prepared an Initial Statement of Reasons and is making available the express terms of the proposed ac- tion, all of the information upon which the proposal is based, and a rulemaking file.

A copy of the Initial State- ment of Reasons and the proposed text of the regulation may be obtained from the agency contact person named in this notice. The information upon which DPR relied in preparing this proposal and the rulemaking file are available for review at the address specified below. A V AILABILITY OF CHANGED OR MODIFIED TEXT After the close of the comment period, DPR may make the regulation permanent if it remains substantial- ly the same as described in the Informative Digest.

If DPR does make substantial changes to the regulation, the modified text will be made available for at least 15 days prior to adoption. Requests for the modified text should be addressed to the agency contact person named in this notice. DPR will accept written com- ments on any changes for 15 days after the modified text is made available.

AGENCY CONTACT Written comments about the proposed regulatory ac- tion; requests for a copy of the Initial Statement of Rea- sons, and the proposed text of the regulation; and in- quiries regarding the rulemaking file may be directed to: Lauren Otani, Environmental Scientist Department of Pesticide Regulation 1001 I Street, P.O.

Box 4015 Sacramento, California 95812−4015 916−445−5781 Note: In the event the contact person is unavailable, questions on the substance of the proposed regulatory action may be directed to the following back−up person at the same address as noted above: Jill Townzen, Special Advisor Pesticide Programs Division 916−324−6174 This Notice of Proposed Action, the Initial Statement of Reasons, and the proposed text of the regulation are also available on DPR’s Internet Home Page <http://www.cdpr.ca.gov>.

Upon request, the docu- ments can be made available in another language, or an alternate form as a disability−related accommodation. A V AILABILITY OF FINAL STATEMENT OF REASONS Following its preparation, a copy of the Final State- ment of Reasons mandated by Government Code sec- tion 11346.9(

a) may be obtained from the contact per- son named above. In addition, the Final Statement of 1837

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z Reasons will be posted on DPR’s Internet Home Page and accessed at <http://www.cdpr.ca.gov>. TITLE 4.

CALIFORNIA HORSE RACING BOARD NOTICE OF PROPOSAL TO ADD RULE 1859.1, OUT−OF−COMPETITION TESTING PROCEDURES AND REQUIREMENTS RULE 1869, PROHIBITED DRUG SUBSTANCES IN OUT−OF−COMPETITION TESTING AND TO AMEND RULE 1858, TEST SAMPLE REQUIRED RULE 1859, TAKING, TESTING AND REPORTING OF SAMPLES RULE 1859.25, SPLIT SAMPLE TESTING RULE 1867, PROHIBITED VETERINARY PRACTICES The California Horse Racing Board (Board or CHRB) proposes to add and amend the regulations de- scribed below after considering all comments, objec- tions or recommendations regarding the proposed action.

PROPOSED REGULATORY ACTION The Board proposes to add Rule 1859.1, Out−of− Competition Testing Procedures and Requirements, to establish procedures by which the Board will collect out−of−competition test samples, as well as penalties for non−compliance. Specifically, out−of−competition test samples will be collected at the direction of the offi- cial veterinarian, the Equine Medical Director, or his/ her designee at any time and in any location.

Trainers, owners, and their designees are required to disclose the location of all of their horses that are eligible for out− of−competition testing; however, any party may re- quest that their horse be tested in an alternative location. Additionally, trainers, owners, their designee(s), and racing association employees are required to cooperate with persons collecting out−of−competition test sam- ples.

Licensees who willfully fail to make a horse avail- able for out−of−competition testing, or who cause inter- ference or obstruction to the sampling process will re- ceive a minimum one−year license suspension, and horses not made available for out−of−competition test- ing will be placed on the Steward’s List for a minimum of 180 days. The Board also proposes to add Rule 1869, Prohibit- ed Drug Substances in Out−of−Competition Testing, to list all medications, drugs, and other substances that are prohibited from being present in an out−of−competition test sample.

The proposed rule will describe exceptions for certain therapeutic medications in cases where spe- cific procedural and reporting requirements are fol- lowed by the trainer and/or their veterinarian. Finally, the rule will describe the liability and rights of trainers, owners, and other licensees who have the care and cus- tody of a horse that tests positive for a prohibited sub- stance in an out−of−competition test sample.

The Board also proposes to amend Rule 1858, Test Sample Required, to clarify the Board’s authority to collect official blood, urine, and other biological test samples, as well as describe specifically which horses are eligible for out−of−competition testing. Additional- ly, the proposed amendment will make it a condition of trainers’ and owners’ licenses that the Board be given consent to collect out−of−competition test samples at any location where an eligible horse is present.

The Board also proposes to amend Rule 1859, Tak- ing, Testing and Reporting of Samples, to make minor technical changes to existing language that ensures out− of−competition testing procedures do not conflict with existing official test sample collection requirements. The Board also proposes to amend Rule 1859.25, Split Sample Testing, to extend the same split sample process and rights currently in place for post−race test- ing to licensees who have a horse in their custody that test positive for a prohibited substance in an out−of− competition test sample.

Finally, the Board proposes to amend Rule 1867, Pro- hibited Veterinary Practices, to add a number of medi- cations and drug substances to the current prohibited list, and extend the regulation’s application to sub- stances detected in out−of−competition test samples. PUBLIC HEARING The Board will hold a public hearing starting at 9:30 a.m., Thursday, December 13, 2018, or as soon after that as business before the Board will permit, in the Fin- ish Line Room at the Los Alamitos Race Course, 4961 Katella Avenue, Los Alamitos, California.

At the hearing, any person may present statements or argu- ments orally or in writing about the proposed action de- scribed in the informative digest. It is requested, but not required, that persons making oral comments at the hearing submit a written copy of their testimony. WRITTEN COMMENT PERIOD Any interested persons, or their authorized represen- tative, may submit written comments about the pro- posed regulatory action to the Board. The written com- ment period closes at 5:00 p.m. on December 3, 2018.

The Board must receive all comments at that time; how- ever, written comments may still be submitted at the public hearing. Submit comments to: 1838

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z Robert Brodnik, Staff Counsel California Horse Racing Board 1010 Hurley Way, Suite 300 Sacramento, CA 95825 Telephone (916) 263−6026 Fax: (916) 263−6022 E−Mail: Rjbrodnik@chrb.ca.gov AUTHORITY AND REFERENCE Authority cited: Sections 19420, 19440, 19562, 19577, 19580, and 19582, Business and Professions Code. Reference: Sections 19401, 19420, 19440, 19577, 19580, 19581, 19582, and 19583, Business and Professions Code;

Section 603, Evidence Code; and Sections 337f, 337g and 337h, Penal Code. Business and Professions Code sections 19420, 19440, 19562, 19577, 19580, and 19582 authorize the Board to adopt the proposed regulatory additions and amendments, which would implement, interpret or make specific sections 19401, 19420, 19440, 19577, 19580, 19581, 19582, and 19583, Business and Profes- sions Code;

Section 603, Evidence Code; and Sections 337f, 337g and 337h, Penal Code. INFORMATIVE DIGEST/POLICY STATEMENT OVERVIEW Business and Professions Code

section 1940l(

a) ex- plains that it is the intent of the Horse Racing Law to al- low pari−mutuel wagering on horse races while assur- ing protection of the public. Business and Professions Code

section 19420 states that the Board has jurisdic- tion and supervision over meetings in this State where horse races with wagering on their results are held or conducted, and over all persons or things having to do with the operation of such meetings. Business and Pro- fessions Code

section 19440 provides that the Board shall have all powers necessary and proper to enable it to carry out fully and effectually the purposes of this chapter. Responsibilities of the Board shall include adopting rules and regulations for the protection of the public and the control of horse racing and pari−mutuel wagering. Business and Professions Code

section 19562 states the Board may prescribe rules, regulations and conditions under which all horse races with wager- ing on their results shall be conducted in California. Business and Professions Code

section 19580 requires the Board to adopt regulations to establish policies, guidelines, and penalties relating to equine medication to preserve and enhance the integrity of horse racing in California. Business and Professions Code

section 19583 states that every veterinarian who treats a horse within the inclosure shall report the details of such treat- ment to the official veterinarian in writing.

The Board proposes to add Rule 1859.1, Out−of− Competition Testing Procedures and Requirements, Rule 1869, Prohibited Drug Substances in Out−of− Competition Testing, and to amend Rule 1858, Test Sample Required, Rule 1859, Taking, Testing and Re- porting of Samples, Rule 1859.25, Split Sample Testing and Rule 1867, Prohibited Veterinary Practices to bring the CHRB’s regulatory scheme in line with the recom- mendations and research of the Racing Medication Testing Consortium (RMTC) 1 and the Association of Racing Commissioners International (ARCI). 2 These organizations recently developed model rules and pro- hibited substance lists for out−of−competition testing that are intended to enhance the integrity of horse racing by controlling which medications race horses are ad- ministered while training.

While the CHRB’s current regulations restrict those medications that may be present in a horse during a race, they are generally silent as to which medications may or may not be used during training (i.e. when the horse is out−of−competition). Although many medications have legitimate therapeu- tic uses, others can have performance enhancing effects that give horses an unfair advantage when racing. Until now, CHRB’s drug testing efforts have focused almost exclusively on monitoring and restricting sub- stances that are physically detectable in a horse imme- diately after a race.

Although this has effectively cur- tailed the use of performance enhancing/altering sub- stances immediately prior to a race, it does little to ad- dress the issue of substances that enhance performance long after they have been eliminated from the horse’s body. For example, anabolic steroids, which have valid therapeutic uses, can also have muscle building side ef- fects.

Therefore, even after the steroid completely 1 The RMTC strives to develop and promote uniform rules, poli- cies and testing standards at the national level; coordinate re- search and educational programs that seek to ensure the integrity of racing and the health and welfare of racehorses and partici- pants; and to protect the interests of the racing public. The RMTC was founded in 2001 by representatives of a broad spectrum of racing−related groups who participated in an industry effort to de- termine potential consensus points on the most basic elements of a uniform national medication policy for racehorses.

The RMTC is incorporated as a 501(c)(3) charitable organization with both scientific and educational purposes. It is governed by a board of directors consisting of 24 industry stakeholder groups. 2 The ARCI is composed of the governmental regulators of horse and greyhound racing in the United States, Canada, Mexico, Ja- maica, and Trinidad−Tobago. ARCI collaborates with other rac- ing industry organizations who share its common goal of ensuring integrity in racing. ARCI is a not−for−profit trade association with no regulatory authority.

Its members individually possess regula- tory authority within their jurisdictions and solely determine whether or not to adopt ARCI recommendations on policies and rules. 1839

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z clears a horse’s system, the horse may still have en- hanced muscle mass that it could not have naturally de- veloped without the assistance of the steroid. Accord- ingly, the CHRB seeks to better control and restrict medications used while horses are not in competition so as to ensure greater fairness and safety in California racing.

The proposed addition of Rule 1859.1, Out−of−Com- petition Testing Procedures and Requirements, will es- tablish procedures by which the Board will collect out− of−competition test samples, as well as penalties for non−compliance. Specifically, out−of−competition test samples will be collected at the direction of the official veterinarian; the Equine Medical Director, or his/her designee at any time and in any location. Trainers, own- ers, and their designee(

s) are required to disclose the lo- cation of all of their horses that are eligible for out−of− competition testing; however, any party may request that their horse be tested in an alternative location. Ad- ditionally, trainers, owners, their designee(s), and rac- ing association employees are required to cooperate with persons collecting out−of−competition test sam- ples.

Licensees who willfully fail to make a horse avail- able for out−of−competition testing, or who cause inter- ference or obstruction to the sampling process will re- ceive a minimum one−year license suspension, and horses not made available for out−of−competition test- ing will be placed on the Steward’s List for a minimum of 180 days. The proposed addition of Rule 1869, Prohibited Drug Substances in Out−of−Competition Testing, will define those drugs, substances, doping agents, and medica- tions that are prohibited from being present in an out− of−competition test sample.

Specifically, anabolic an- drogenic steroids will be prohibited unless the anabolic agent has been approved by the United States Food and Drug Administration (FDA), is administered pursuant to a valid veterinary prescription, and is reported to the Official Veterinarian on CHRB−60 (Rev. 7/15), Trainer Medication Report. Additionally, horses receiving per- mitted anabolic steroid treatments will be required to remain on the Veterinarian’s List for a minimum of six months, and until such horse is declared raceably sound and in fit physical condition to exert its best effort in a race.

Also prohibited will be: selective androgen recep- tor modulators, tibolone, and zeranol; Erythropoietin− Receptor agonists; Hypoxia−inducible factor stabiliz- ers (except out−of−competition blood samples may contain cobalt in an amount that does not exceed 50 nanograms per milliliter); Chorionic Gonadotropin and Luteinizing Hormone and their releasing factors; Corti- cotrophins and their releasing factors (except adreno- corticotropic hormone (ACTH) may be used in a horse that is out−of−competition, provided that the substance is administered pursuant to a valid veterinary prescrip- tion, and is reported to the Official Veterinarian on CHRB−60 (Rev. 7/15), Trainer Medication Report); Beta−2 agonists, including all optical isomers (except clenbuterol and albuterol may be used in a horse that is out−of−competition, provided that the administration is pursuant to a valid veterinary prescription, and both the administration and prescription are carried out in accor- dance with all rules and regulations in this division); aminoglutethimide, anastrozole, androsta−l,4,6− triene−3,17−dione (androstatrienedione), 4 an- drostene−3,6,17 trione (6−oxo), exemestane, formes- tane, letrozole, and testolactone; raloxifene, tamoxifen, and toremifene; clomiphene, cyclofenil, and fulves- trant; myostatin inhibitors; activators of the AMP− activated protein kinase, Peroxisome Proliferator Acti- vated Receptor δ (PPARδ) agonists, insulins, trimetazi- dine, Thyroxine, and thyroid modulators/hormones containing T4 (tetraiodothyronine/thyroxine), T3 (tri- iodothyronine), or combinations thereof (except Thy- roxine (T4) will not be considered a prohibited sub- stance, and altrenogest will not be considered a prohib- ited substance provided that such treatments are made pursuant to a valid veterinary prescription, and both the administrations and prescriptions are carried out in ac- cordance with all rules and regulations in this division); desmopressin, furosemide, plasma expanders, probenecid, torsemide, acetazolamide, amiloride, bumetanide, canrenone, chlorthalidone, etacrynic acid, indapamide, metolazone, spironolactone, thiazides, tri- amterene, trichlormethiazide, vasopressin receptor an- tagonists, and vaptans (except furosemide and trichlormethiazide may be used in a horse that is out− of−competition, provided that the administration is pur- suant to a valid veterinary prescription, and both the ad- ministration and prescription are carried out in accor- dance with all rules and regulations in this division).

Additionally, any of the diuretics mentioned above may be administered in an emergency situation in order to safeguard the health of the horse so long as the sub- stance is administered pursuant to a valid veterinary prescription, and is reported to the Official Veterinarian by the trainer on CHRB−60 (Rev. 7/15), Trainer Medi- cation Report, or by the treating veterinarian on form CHRB−24 (Rev. 7/15), Veterinarian Report, within 24 hours of the administration.

Otherwise, any substance not prohibited by this regulation is permitted for use when a horse is out−of−competition, provided such substance has been approved by the FDA for use in the United States, and is prescribed and administered in ac- cordance with all applicable federal and state laws and regulations, including all CHRB rules and regulations. Additionally, proposed Rule 1869 will establish a presumption that a prohibited drug substance detected in an official out−of−competition test sample is prima facie evidence that the drug substance has been admin- 1840

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z istered to the horse. If the out−of−competition test sam- ple was obtained outside a CHRB licensed inclosure, then the trainer, owner and/or any other licensee shown by a preponderance of the evidence to have been re- sponsible for the care, custody and control of the horse may be fined and/or have his/her license suspended or revoked.

If the out−of−competition test sample was ob- tained inside a CHRB licensed inclosure, the proposed rule will make the trainer the absolute insurer of horses under their care and subject to a fine, and/or license sus- pension or revocation. Additionally, the proposed rule will make the defenses in CHRB Rule 1888, Defense to Trainer Insurer Rule, available to anybody charged with violating this proposed regulation, and will also apply the same penalty guidelines as described in Rule 1843.2, Classification of Drug Substances, and Rule 1843.3, Penalties for Medication Violations.

Finally, an out−of−competition test sample containing a prohibited substance will require that the horse be placed on the Veterinarian’s list for a minimum of 180 days. The proposed amendment to Rule 1858, Test Sample Required, will add a new subsection (

b) to explain that the Board may take official blood, urine or other biolog- ical samples from horses, in accordance with Rules 1859 and 1859.1, to enhance the ability of the Board to enforce its medication and anti−doping rules at any time or date. The amendment will further revise new subsec- tion (

c) to expand horses eligible for testing (out−of− competition or otherwise) to include any horse under the care or control of a licensed trainer, or owned by a li- censed owner. The amendment also explains that a horse is “out−of−competition” when it is not entered in a race as defined in this Article, and otherwise prohibits testing of weanlings, yearlings, and horses no longer engaged in racing that are outside of the inclosure and not entered in a Board−authorized horse sale.

Finally, the proposed amendment states that as a condition of li- censure, persons holding trainer and owner licenses shall be deemed to have given consent for the Board to access any location, whether inside or outside of a li- censed inclosure, where a horse eligible for testing may be found for the purpose of collecting official out−of− competition test samples. The proposed amendment further explains, however, that such consent does not permit the Board to search surrounding premises when collecting out−of−competition test samples.

The proposed amendment to Rule 1859, Taking, Testing and Reporting of Samples, specifies that all of- ficial test samples are to be “biological” in nature, and also makes an exception to the requirement that sam- ples must be collected in a Board−approved detention area for out−of−competition test samples. Finally, the proposed amendment allows for test samples to be wit- nessed, confirmed or acknowledged by owners of hors- es, in addition to their trainers.

The proposed amendment to Rule 1859.25, Split Sample Testing, extends the same split sample process and rights currently in place for post−race testing under the regulation to licensees who have a horse in their cus- tody test positive for a prohibited substance in an out− of−competition sample. The proposed amendment to Rule 1867, Prohibited Veterinary Practices, adds the following medications and drug substances to the current prohibited list: ven- oms or derivatives thereof, aminoimidazole car- boxamide ribonucleotide (AICAR), hemopure, Myo− Inositol Trispyprophosphate (ITPP), oxyglobin, and thymosin beta.

It also makes an exception for platelet rich plasma and autologous conditioned plasma under the general prohibition against growth hormones and analogs, so long as they are administered pursuant to a valid, veterinary prescription and are reported to the Of- ficial Veterinarian by the trainer on CHRB−60 (Rev. 7/15) (Trainer Medication Report). Additionally, the proposed amendment deletes an obsolete reference to Guide 1240.3025 of the FDA Center for Veterinary Medicine (CVM) Program Policy and Procedures Man- ual that is no longer used by the FDA Center for Veteri- nary Medicine.

Finally, the proposed amendment ex- tends Rule 1867’s application to prohibited substances detected in out−of−competition test samples. FORMS INCORPORATED BY REFERENCE 1) Form CHRB−24, Veterinarian Report, revised 07/15 2) Form CHRB−60, Trainer Medication Report, revised 07/15 The proposed amendment to Rule 1867 and addition of Rule 1869 will incorporate by reference CHRB−24, Veterinarian Report (Revised 07/15), and CHRB−60, Trainer Medication Report (Revised 07/15), as it would be cumbersome, unduly expensive or otherwise im- practical to publish these documents in the California Code of Regulations.

Form CHRB−24, Veterinarian Report (Revised 07/15), will be used by licensed veterinarians to report to the Official V eterinarian details of diuretic adminis- trations made in emergency situations as described in Rule 1869(a)(13)(B). Under the proposed regulations, either the treating veterinarian or the trainer will need to report the administration to the Official Veterinarian within 24 hours.

Under existing regulations, veterinari- ans treating horses within the inclosure already have to report all medication prescriptions and administrations to the Official Veterinarian on this form, and therefore this provision is consistent with other CHRB rules. If the emergency administration occurs outside of the in- closure, however, the trainer then will be responsible for reporting the administration on Form CHRB−60. 1841

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z Form CHRB−60, Trainer Medication Report (Re- vised 07/15), will be used by licensed trainers to report each administration of platelet rich plasma and autolo- gous conditioned plasma, anabolic androgenic steroids, adrenocorticotropic hormone (ACTH), and emergency diuretic treatments given to horses in their care to the Official Veterinarian.

The form includes fields for the name of the horse, name of the trainer, type of medica- tion administered, and date and time of treatment so that the Official Veterinarian may properly identify all hors- es within the inclosure that have been administered these substances.

POLICY STATEMENT OVERVIEW OF ANTICIPATED BENEFITS OF PROPOSAL The proposed addition of Rules 1859.1 and 1869, and the proposed amendments to Rules 1858, 1859, 1859.25, and 1867, will substantially enhance the in- tegrity and fairness of California horse racing by more effectively monitoring and controlling the use of medi- cations in race horses when they are out−of− competition. Currently, the CHRB’s drug enforcement efforts focus almost exclusively on restricting sub- stances that are physically detectable in a horse imme- diately after a race.

Although this has effectively cur- tailed the use of performance enhancing/altering sub- stances immediately prior to a race, it does little to ad- dress the issue of substances that enhance performance long after they have been eliminated from the horse’s body. While the CHRB regularly tests horses that are out−of−competition, it presently has no recourse when a substance is detected that is a known performance en- hancer.

Accordingly, these proposed regulatory changes will allow the CHRB to affirmatively restrict certain medications and drug substances in race horses that are intended to compete but not currently entered for a specific race (i.e. horses that are “out−of− competition”). 3 Such a change will first and foremost benefit the health and welfare of the horse. By giving the CHRB a mechanism to prosecute trainers, veterinarians, and/or owners who administer non−therapeutic medications or other drug substances to horses that are out−of−compe- tition, the Board will be able to deter doping schemes that may harm the horse.

A number of the substances prohibited under the proposed rules can have side ef- 3 Pursuant to current CHRB regulations, a horse is not entered to race (i.e. in−competition) until 48 hours before the race is actually run. Therefore a horse tested three days before it runs is still con- sidered “out−of−competition.” fects that negatively impact the health of the horse.4 By explicitly banning such substances — and attaching a penalty in those instances where the substance is de- tected in an out−of−competition test sample — the Board will further curtail use of such drugs.

The proposed changes will also benefit the wagering public because out−of−competition testing will further eliminate the chance that a horse will unnaturally and/or unlawfully have its performance enhanced during a race due to prior doping. This will help ensure that the public is wagering on the merits of the horses’ natural abilities, and not being deceived by the improper and/or illicit use of performance enhancing drug substances. Finally, the proposed changes will benefit the horse racing industry by enhancing the sport’s integrity and perception.

By expanding the CHRB’s role in monitor- ing and restricting medication use in race horses, both the participating licensees and the public will have greater confidence in the fairness and safety of Califor- nia racing, which in turn may grow viewership and wa- gering. Accordingly, these amendments will benefit the health, safety and welfare of horses, licensees, and the wagering public.

CONSISTENCY EV ALUATION During the process of developing the regulation and amendments, the Board has conducted a search of any similar regulations on this topic and has concluded that the regulation is neither inconsistent nor incompatible with existing state regulations. DISCLOSURE REGARDING THE PROPOSED ACTION Mandate on local agencies and school districts: none. Cost or savings to any state agency: none. Cost to any local agency or school district that must be reimbursed in accordance with Government Code Sections 17500 through 17630: none.

Other non−discretionary costs or savings imposed upon local agencies: none. Cost or savings in federal funding to the state: none. The Board has made an initial determination that the proposed addition of Rules 1859.1 and 1869, and the proposed amendments to Rules 1858, 1859, 1859.25, and 1867 will not have a significant statewide adverse economic impact directly affecting businesses includ- ing the ability of California businesses to compete with businesses in other states. 4 For example, auto−immune anemias associated with erythro- poietin receptor agonists has been documented in horses.

The World Anti−Doping Agency (WADA) issued a warning to ath- letes pointing out pre−clinical trials of the peroxisome prolifera- tor−activated receptor agonist “GW50l516” were halted over se- rious toxicity issues. 1842

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z The following studies/relevant data were relied upon in making the above determination:  ARCI Model Rules of Racing — Version 8.1 (revised July 2017), pgs. 258−265, 284−288, 416−425, and 443−447.  World Anti−Doping Agency — The 2014 Prohibited List International Standard — (2014 Version 2.0) Cost impact on representative private persons or businesses: none. The Board is not aware of any cost impacts that a rep- resentative private person or business would necessari- ly incur in reasonable compliance with the proposed action.

Significant effect on housing costs: none. RESULT OF ECONOMIC IMPACT ANALYSIS The proposed addition of Rules 1859.1 and 1869, and the proposed amendments to Rules 1858, 1859, 1859.25, and 1867 will not (1) create or eliminate jobs within California; (2) create new businesses or elimi- nate existing businesses within California; or (3) affect the expansion of businesses currently doing business within California.

The proposed regulatory changes promote the safety and welfare of race horses in Califor- nia by implementing a mechanism for the CHRB to af- firmatively monitor and restrict medications and drug substances in horses that are intended to compete but not currently entered for a specific race. Such a program not only protects the horses, but also protects their rid- ers and the wagering public. Furthermore, an effective out−of−competition testing program will further en- hance the integrity of horse racing in California, which in turn may grow viewership and wagering.

An increase in wagering will have a positive economic impact on the industry by increasing handle, which in turn increases purses and commissions. The proposed regulation will not impact the state’s environment. Effect on small businesses: none. The proposed addi- tion of Rules 1859.l and 1869, and the proposed amend- ments to Rules 1858, 1859, 1859.25, and 1867 do not affect small businesses because horse racing is not a small business under Government Code

Section 11342.610. CONSIDERATION OF ALTERNATIVES In accordance with Government Code

Section 11346.5, subdivision (a)(l3), the Board must determine that no reasonable alternative considered by the Board, or that has otherwise been identified and brought to the attention of the Board, would be more effective in car- rying out the purpose for which the action is proposed, or would be as effective and less burdensome on affect- ed private persons than the proposed action, or would be more cost−effective to affected private persons and equally effective in implementing the statutory policy or other provision of law.

The Board invites interested persons to present state- ments or arguments with respect to alternatives to the proposed regulation at the scheduled hearing or during the written comment period.

CONTACT PERSON Inquiries concerning the substance of the proposed action and requests for copies of the proposed text of the regulation, the initial statement of reasons, the modified text of the regulation, if any, and other information upon which the rulemaking is based should be directed to: Robert Brodnik, Staff Counsel California Horse Racing Board 1010 Hurley Way, Suite 300 Sacramento, CA 95825 Telephone: (916) 263−6026 E−mail: Rjbrodnik@chrb.ca.gov If the person named above is not available, interested parties may contact: Andrea Ogden, Manager Policy, Regulations and Legislation Telephone: (916) 263−6033 A V AILABILITY OF INITIAL STATEMENT OF REASONS AND TEXT OF PROPOSED REGULATION The Board will have the entire rulemaking file avail- able for inspection and copying throughout the rule- making process at its offices at the above address.

As of the date this notice is published in the Notice Register, the rulemaking file consists of this notice, the proposed text of the regulation, and the initial statement of rea- sons. Copies may be obtained by contacting Robert Brodnik, or the alternative contact person at the ad- dress, phone number or e−mail address listed above. A V AILABILITY OF MODIFIED TEXT After holding a hearing and considering all timely and relevant comments received, the Board may adopt the proposed regulation substantially as described in this notice.

If modifications are made which are suffi- ciently related to the originally proposed text, the modi- fied text, with changes clearly marked, shall be made available to the public for at least 15 days prior to the date on which the Board adopts the regulations. Re- 1843

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z quests for copies of any modified regulation should be sent to the attention of Robert Brodnik at the address stated above. The Board will accept written comments on the modified regulation for 15 days after the date on which it is made available. A V AILABILITY OF STATEMENT OF REASONS: Requests for copies of the final statement of reasons, which will be made available after the Board has adopt- ed the proposed regulation in its current or modified form, should be sent to the attention of Robert Brodnik at the address stated above.

BOARD WEB ACCESS The Board will have the entire rulemaking file avail- able for inspection throughout the rulemaking process at its web site. The rulemaking file consists of the no- tice, the proposed text of the regulation and the initial statement of reasons. The Board’s web site address is: www.chrb.ca.gov. TITLE 10. DEPARTMENT OF INSURANCE GENDER NON−DISCRIMINATION IN AUTOMOBILE INSURANCE RATING REG−2018−00020 Exempt Rulemaking Pursuant to Government Code

section 11340.9(g), this proceeding is exempt from the rulemaking provi- sions of the Administrative Procedure Act. SUBJECT OF PROPOSED RULEMAKING Notice is given that California Insurance Commis- sioner Dave Jones will hold a public hearing to consider amending California Code of Regulations, Title 10,

Chapter 5, Subchapter 4.7,

Article 3,

Section 2632.5, Subsections (d)(9), (d)(13), (c)(2)(F)(viii), (e), and Sec- tion 2632.11, Subsection (

c) to eliminate the use of gen- der in private passenger automobile insurance rating in California pursuant to the authority granted by Insur- ance Code

section 1861.02(a)(4). HEARING Public Hearing Date and Location The Commissioner will hold a public hearing to provide all interested persons an opportunity to present statements or arguments, either orally or in writing, with respect to these regulations, as follows: Date and time: December 3, 2018 at 10:00 a.m. Location: California Department of Insurance 300 Capitol Mall, 13th Floor Sacramento, California 95814 The hearing will continue on the date noted above un- til all testimony has been submitted or until 5:00 p.m., whichever is earlier.

Access to Hearing Rooms The facilities to be used for the public hearing are ac- cessible to persons with mobility impairments. Persons with sight or hearing impairments are requested to noti- fy the contact person(

s) for the hearing in order to make special arrangements, if necessary. WRITTEN COMMENT PERIOD Presentation of Written Comments; Contact Persons All persons are invited to submit written comments on the proposed regulations during the public comment period. The public comment period will end at 5:00 p.m. on Monday, December 3, 2018.

Please direct all written comments to the following contact person: Emily Gallagher, Staff Counsel Rate Enforcement Bureau 45 Fremont Street, 21st Floor San Francisco, CA 94701 Phone: (415) 538−4108 Fax: (415) 904−5490 Email: emily.gallagher@insurance.ca.gov Questions regarding procedure, comments, or the substance of the proposed action should be addressed to the above contact person.

If the above contact person is unavailable, inquiries may be addressed to the follow- ing backup contact person: Jennifer McCune, Attorney IV Rate Enforcement Bureau 45 Fremont Street, 21st Floor San Francisco, CA 94701 Tel: (415) 538−4148 Fax: (415) 904−5490 Email: jennifer.mccune@insurance.ca.gov Please note that under the California Public Records Act (Government Code

Section 6250, et seq.), your written and oral comments, and associated contact in- 1844

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z formation (e.g., your address, phone number, e−mail, etc.) become part of the public record and can be re- leased to the public upon request. Deadline for Written Comments All written materials must be received by the Insur- ance Commissioner, addressed to the contact person at the address listed above, no later than 5:00 p.m. on Monday, December 3, 2018. Any written materials re- ceived after that time may not be considered.

Comments Transmitted by E−Mail or Facsimile The Commissioner will accept written comments transmitted by e−mail provided they are sent to the fol- lowing e−mail address: emily.gallagher@insurance. ca.gov. The Commissioner will also accept written comments transmitted by facsimile provided they are directed to the attention of Emily Gallagher and sent to the following facsimile number: (415) 904−5490. Comments sent to e−mail addresses or facsimile numbers other than those designated in this notice will not be accepted.

Comments sent by e−mail or facsimile are subject to the deadline set forth above for written comments. AUTHORITY AND REFERENCE The proposed regulations will implement the provi- sions of Insurance Code

section 1861.02(a)(4), which also provides the rulemaking authority for this action. INFORMATIVE DIGEST

Summary of Existing Law Proposition 103 is codified in Insurance Code 1861.05(

a) which states that no rate subject to its terms should be inadequate, excessive, or unfairly discrimi- natory. Insurance Code

section 1861.02 permits the Commissioner to adopt optional automobile insurance rating factors in conformity with Proposition 103’s mandate. Pursuant to this authority, the Commissioner adopted by regulation gender of the rated driver as an optional rating factor in first years following the pas- sage of Proposition 103, approximately thirty years ago. Insurance Code

section 1861.02(a)(4) does not re- quire the Commissioner to adopt any optional rating factors, and thus provides authority for him to eliminate previously established factors at his discretion. Effect of Proposed Action The proposed amendments will eliminate the use of a driver’s gender in private passenger automobile insur- ance rating by eliminating gender of the rated driver from the list of optional rating factors in Insurance Code

section 1861.02. Policy Statement Overview The purpose of the proposed amendments is to re- move any consideration of a driver’s gender in the set- ting of private passenger automobile insurance rating. Insurance Code

section 1861.05(

a) states that no rate should be inadequate, excessive, or unfairly discrimi- natory. A regime in which auto insurance rates are based on personal characteristics over which a driver has no control, such as gender, rather than on factors within a driver’s control, is more likely to be unfairly discriminatory because it may not treat equally individ- uals who make the same risk−averse choices.

The logical justification for the apparent statistical basis of treating males and females differently in auto rating has become suspect over the years as company experience has come to vary widely, with some compa- nies finding females to be a higher risk while other com- panies find similarly situated males to be a higher risk. With regard to distracted driving, currently reported by insurers to be one of the primary drivers of increased ac- cident frequency and severity, there is no difference in the experience of male versus female drivers.

The Gender Recognition Act, which permits Califor- nia driver license applicants to select “nonbinary” to ap- pear on their driver license instead of “male” or “fe- male” beginning on January 1, 2019, brought the prob- lems with using gender as an optional rating factor to the fore. Insurers who use the optional rating factor have expressed uncertainty as to how to rate individuals who identify as nonbinary. There is no historical experi- ence upon which to establish an actuarially justified nonbinary rate.

Given the small population size of non- binary drivers, it is likely that there will never be suffi- ciently credible data upon which to base such a rate. The term “nonbinary” as defined in the Gender Recognition Act describes a population with significant diversity. This combination of small population size and non− homogeneity reduces the value of treating drivers with- in that population as statistically similar.

Further, by extending legal recognition to persons with nonbinary identities through the courts and through legislative action, California has acknowl- edged that gender is a spectrum rather than a binary. Eliminating gender as a rating factor ensures that nonbi- nary individuals are treated fairly under Proposition 103’s mandate to avoid unfairly discriminatory rates.

Even if data for nonbinary drivers were credible, al- lowing insurers to rate nonbinary drivers in a third cate- gory would not address the other problems with gender as an optional rating factor that have become apparent through the decades since its initial adoption. These nu- merous concerns weigh in favor of conforming the op- 1845

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z tional rating factors to the spirit of the Unruh Civil Rights Act by eliminating gender. Benefits Anticipated Th e benefits anticipated to result from the adoption of the proposed amendments to these regulations include the promotion of efficiency, fairness, and social equity, and the prevention of discrimination. Eliminating gen- der from auto insurance rating helps to bring about a regime in which auto insurance rates are based on fac- tors within a driver’s control, rather than personal char- acteristics over which drivers have no control.

This pro- motes fairness and social equity by treating equally in- dividuals who make the same risk−averse choices. Re- moving gender as a rating factor prevents discrimina- tion based on gender by its terms. These regulations will ensure actuarially sound rates, fair treatment of nonbi- nary drivers as they begin to take advantage of the Gen- der Recognition Act, and simplified class plans that will not require insurers to attempt to rate nonbinary drivers based on gender.

Consistency or Compatibility with Existing State Regulations The proposed amendments are not inconsistent or in- compatible with any other existing regulations. These proposed amendments specifically address the optional automobile insurance rating factors, which no other state regulations do. NOT MANDATED BY FEDERAL LAW OR REGULATIONS These regulations are not mandated by federal law. There are no existing federal regulations or statutes comparable to these proposed regulations as no federal statutes or regulations address state automobile insur- ance rating factors.

OTHER STATUTORY REQUIREMENTS The Department evaluated whether there were other requirements prescribed by statute applicable to these regulations by reviewing statutes and regulations relat- ing to this issue, and determined that there were no such requirements. LOCAL MANDATE The proposed regulations do not impose any mandate on local agencies or school districts. There are no costs to local agencies or school districts for which

Part 7 (commencing with

Section 17500) of Division 4 of the Government Code would require reimbursement. FISCAL IMPACT T he submission of revised class plans will also create a one−time fiscal impact on the Department. Actuaries and analysts will review the revised class plans that in- surers submit to ensure compliance. The time required for analyst or actuarial review of the revised class plan would be greatly reduced compared to the review of a complete class plan. Table 3 specifies the anticipated costs to the Department of conducting the reviews of the revised class plans required by the regulation.

As a re- sult, because the regulations are projected to lead to 167 insurers filing 174 revised class plans, there will be a $276,000 fiscal impact on the Department to conduct reviews of the revised class plans. T able 3.

Estimated Department Cost of a Revised lass Plan Title Rate Analyst Senior Casualty Actuary Bureau Chief Rate Analyst — Intake Average Cost per Filing Hours 20 4 2 2 Estimated Annual Salary $70,000 $160,000 $95,000 $65,000 Salary + Total Cost Benefits per Filing $98,000 $942 $224,000 $431 $133,000 $128 $91,000 $88 $1,588 C The Department has determined that there will be no cost to any local agency or school district that is re- quired to be reimbursed under

Part 7 (commencing with

Section 17500) of Division 4 of the Government Code, no other nondiscretionary cost or savings imposed on local agencies, and no cost or savings in federal funding to the State. HOUSING COSTS The proposed regulations will have no significant ef- fect on housing costs.

SIGNIFICANT STATEWIDE ADVERSE ECONOMIC IMPACT DIRECTLY AFFECTING BUSINESS, INCLUDING THE ABILITY OF CALIFORNIA BUSINESSES TO COMPETE The Department has made an initial determination that the proposed amendments will not have a signifi- cant, statewide adverse economic impact directly af- fecting business, including the ability of California businesses to compete with businesses in other states. The facts and evidence upon which this determination was made is described below in the statement of the re- sults of the economic impact assessment. Results of the Economic Impact Assessment Below is a

summary of the results of the Economic Impact Assessment pursuant to Government Code sec- 1846

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z tions 11346.3(b)(1)(

A) through (D). Detailed analysis of the conclusions follows. A. The proposed regulations will likely have a minimal effect, a net loss of 18.9 jobs, on overall employment within the State of California. The regulation is expected to affect less than one−thousandth of a percent of the total employment in California (i.e., 18.9/17,336,552 = 0.0001%). B.

Given that the average direct cost to an impacted insurer is estimated to be $13,200 ($2.2 million/ 167 firms), it is not anticipated that the proposed regulation will have a significant impact on the creation of new businesses or the elimination of existing businesses in California. C. Given that the average direct cost to an impacted insurer is estimated to be $13,200 ($2.2 million/ 167 firms), it is not anticipated that the proposed regulation will have an impact on the ability of businesses in California to expand.

Additionally, the small impact on total output suggests that the regulation will have a very small impact on the California economy as a whole. D. The proposed regulation will benefit the welfare of California’s residents and insurance consumers by ensuring actuarially sound auto insurance rates and the fair treatment of nonbinary drivers. This proposed regulation will also prevent discrimination on the basis of gender in auto insurance policies.

THE ECONOMIC IMPACT ON JOBS, BUSINESSES, AND THE STATE ECONOMY The Department evaluated the potential changes in economic variables, including output and employment, which could result from the proposed regulation. Indus- try employment and output effects were assessed using the Regional Input−Output Modeling System (RIMS II) multipliers. 1 Job and economic impacts, including the ripple effects (indirect and induced costs/benefits) 1 U.S. Department of Commerce; Bureau of Economic Analysis (BEA): Table 1.5 Regional Input−Output Modeling System (RIMS II) Multipliers (2007/2016).

RIMS II multipliers show how an initial change in economic activity results in new rounds of spending (ripple effects including indirect and induced costs/ benefits). For example, building a new road will lead to increased production of asphalt and concrete. The increased production of asphalt and concrete will lead to more mining. Workers benefiting from these increases will spend more, perhaps by eating out at nicer restaurants or splurging more on entertainment. For exam- ple, a new $1 million road will lead to an estimated 9.9 jobs throughout the economy and an increase in output of $2 million.

Likewise, under RIMS an initial decrease in economic activity will lead to a decrease in production. of the regulation on employment and output, are calcu- lated using the direct cost estimates to insurers. Creation or Elimination of Jobs within the State The job impact estimates are based on aggregated da- ta presented as full−time equivalents, not necessarily full−time jobs. The job impacts were calculated using the RIMS II multipliers for insurance carriers.

The De- partment calculated that removing the gender rating factor will likely have offsetting impacts on males and females based on Years of Driving Experience (YDE), as described above. Since these direct impacts are offset within the same industry sector and premiums will not change overall, there are no expected induced or indi- rect economic impacts to the total economy resulting from the removal of the gender rating factor.

The only cost that is estimated to have an impact on jobs, or out- put via induced or indirect economic impacts to the total economy, is the direct cost of preparing the revised class plan. The RIMS II multiplier for insurers is a ratio of 8.6023 jobs lost throughout the economy for every one million dollars in added costs. Due to strong job gains in the insurance industry sector the calculated job losses will likely not result in actual job losses, but will instead result in slightly slower job growth.

The ratio multi- plied by the estimated direct cost of $2.2 million, equals the projected number of jobs lost, which is 18.9 (8.6023 x $2.2 million = 18.9). The proposed regulation is expected to have a mini- mal effect on total statewide employment.

According to the Department of Finance, the projected total nonfarm employment for 2019 is nearly 17.4 million in Califor- nia. 2 When dividing the projected number of jobs lost by the number of people employed in nonfarm jobs in California, the result is that the proposed regulations would not affect even one−thousandth of a percent of the total employment in California (i.e., 18.9/ 17,336,552 = 0.0001%). Creation of New Businesses or the Elimination of Existing Businesses, and the Expansion of Businesses To address Government Code sections 11346.3(b)(l)(

B) and (

C) and determine the effect of the proposed regulation on the creation of new businesses or the expansion of existing businesses within the state, the Department uses a broad approach. Factors affect- ing the creation and expansion of businesses are inter- twined and very similar so they are analyzed together. The Department anticipates that due to the structure and competitiveness of the auto insurance market, the regulation will not cause a measurable impact on busi- ness expansion or contraction. 2 http://www.dof.ca.gov/Forecasting/Economics/Eco_ Forecasts_Us_Ca/index.html. The Department of Finance economic forecast data was accessed October, 2018. 1847

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z The Department also calculated the effect of the regu- lation on California’s economic output. Output mea- sures the total market value, including the value of all intermediary goods and services, used in production of a final good or service. The RIMS II multiplier for out- put of 1.9219 represents a $1.92 total economic impact (accounting for all direct, indirect, and induced costs/ benefits) for every one million dollars of direct impact on insurers.

Multiplying the direct cost of the regulation by the RIMS output multiplier results in an estimated loss to total output of $4.2 million (1.9219 x $2.2 mil- lion = $4.2 million). The relatively small impact on out- put suggests that the regulation will have a very small impact on the California economy as a whole and is not likely to lead to a measurable impact on the elimination of existing businesses or the ability of existing busi- nesses to expand. BENEFITS OF THE REGULATIONS Worker Safety and Environmental Effects The proposed regulation is not expected to impact worker safety.

Compliance with the proposed regula- tion does not change the nature of existing job responsi- bilities of the employees in the affected industries. Thus, the proposed regulation will neither increase nor decrease worker safety. The Department also concludes that there will be no measurable effect on the state’s environment. Health and Welfare Effects The proposed regulation will benefit the welfare of California’s residents and insurance consumers by en- suring actuarially sound auto insurance rates and the fair treatment of nonbinary drivers.

This proposed regu- lation will also prevent discrimination on the basis of gender in auto insurance policies. COST IMPACT ON REPRESENTATIVE PERSONS OR BUSINESSES A representative impacted business (private passen- ger auto insurer) will necessarily incur an average cost impact of $13,200 in reasonable compliance with the proposed amendments. BUSINESS REPORT The Department finds that it is necessary for the health, safety or welfare of the people of the state that the regulation apply to businesses.

IMPACT ON SMALL BUSINESSES The proposed regulation will have a minimal adverse direct impact on insurers as discussed in the foregoing analysis, but by law they are not considered small busi- nesses (Government Code § 11342.610(b)(2)).

ALTERNATIVES INFORMATION The Department must determine that no reasonable alternative considered by the Department, or that has otherwise been identified and brought to the attention of the Department, would be more effective in carrying out the purpose for which this action is proposed; would be as effective and less burdensome to affected private persons than the proposed action; or would be more cost−effective to affected private persons and equally effective in implementing the statutory policy underly- ing Insurance Code

section 11736.5. CONTACT PERSON The name and telephone number of the agency repre- sentative and designated contact person are listed above under “WRITTEN COMMENT PERIOD.” A V AILABILITY STATEMENTS The Department has prepared an Initial Statement of Reasons that sets forth the reasons for the proposed ac- tion. Upon request, the Initial Statement of Reasons will be made available for inspection and copying. Requests for the Initial Statement of Reasons or questions regard- ing this proceeding should be directed to the contact person listed above.

Upon request, the Final Statement of Reasons will be made available for inspection and copying once it has been prepared. Requests for the Fi- nal Statement of Reasons should be directed to the con- tact person listed above.

The file for this proceeding, which includes a copy of the express terms of the proposed action, the Initial Statement of Reasons, the Standardized Regulatory Im- pact Analysis, and all the information upon which the proposed action is based, and any supplemental infor- mation, including any reports, documentation and other materials related to the proposed action that is con- tained in the rulemaking file, is available by appoint- ment for inspection and copying at 45 Fremont Street, 24th Floor, San Francisco, California 94105, between the hours of 9:00 a.m. and 4:30 p.m., Monday through Friday.

If the amended regulations adopted by the Depart- ment differ from those which have originally been made available but are sufficiently related to the action proposed, they will be available to the public for at least 1848

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z 15 days prior to the date of adoption. Interested persons should request a copy of these amended regulations pri- or to adoption from the contact person listed above. INTERNET ACCESS Documents concerning proposed regulations are available on the Department’s website at the following link: https://legaldocs.insurance.ca.gov/publicdocs/ RegulationList. TITLE 13. CALIFORNIA HIGHWAY PATROL TITLE 13, CALIFORNIA CODE OF REGULATIONS, DIVISION 2,

CHAPTER 6 AMEND

ARTICLE 1, SECTIONS 1152.7 AND 1152.7.1 Explosives Routes and Stopping Places (CHP−R−2018−04) The California Highway Patrol (CHP) proposes to amend regulations in Title 13 of the California Code of Regulations, Division 2,

Chapter 6,

Article 1, Sections 1152.7 and 1152.7.1, regarding designated routes for the transportation of explosives by commercial vehi- cles on highways in the state. INFORMATIVE DIGEST/POLICY STATEMENT OVERVIEW Pursuant to Division 14, Transportation of Explo- sives, commencing with

Section 31600 of the Califor- nia V ehicle Code, the CHP shall adopt regulations spec- ifying the routes to be used in the transportation of ex- plosives. The CVC requires the CHP to keep informa- tion current in regulations with maps indicating desig- nated routes. The CHP’s field commands conduct annu- al surveys on the explosives routes and stops to deter- mine if changes are necessary. The CHP’s Border Divi- sion proposed an update of explosives routes in the Calexico−El Centro−Brawley area. The proposed regu- lation amendments will remove 65.4 miles and extend 31.6 miles of currently designated routes.

These up- dates will provide carriers an alternative route to reduce potential risks associated with the transportation of ex- plosives, and enhance public health and safety in the Calexico−El Centro−Brawley area. The proposed amendments have received concur- rence from the CHP’s Border Division, Brawley Fire Department, Calexico Fire Department, El Centro Fire Department, Holtville Fire Department, Westmorland Fire Department, Imperial County Fire Department, State Fire Marshal, and California Department of Transportation.

This proposed regulatory action will continue to pro- vide a nonmonetary benefit to the protection of the health, safety, and welfare of California’s residents, workers, and environment. The changes to the applica- tion of the regulation are not substantive and bring the regulation in conformance with existing statute. The proposed changes update and clarify highway routes designated for carriers transporting explosives, and contribute to transportation safety and public health.

During the process of developing these regulations and amendments, the CHP has conducted a search of any similar regulations on this topic and has concluded that these regulations are neither inconsistent, nor in- compatible, with existing federal and state regulations. PUBLIC COMMENT Any interested person may submit written comments on the proposed action via facsimile at (916) 322−3154, by electronic mail to cvsregs@chp.ca.gov, or by writing to: California Highway Patrol Commercial Vehicle

Section Attention: Dr. Tian−Ting Shih P.O. Box 942898 Sacramento, CA 94298−0001 Written comments will be accepted until 5:00 p.m. on December 3, 2018. PUBLIC HEARINGS No public hearing has been scheduled. If any person desires a public hearing, a written request must be re- ceived by the CHP, Commercial Vehicle

Section (CVS), no later than 15 days prior to the close of the written comment period. A V AILABILITY OF INFORMATION The CHP has available for public review an initial statement of reasons for the proposed regulatory action, the information upon which this action is based, and the proposed regulation text in strikeout and underline for- mat. Requests to review or receive copies of this infor- mation should be directed to the CHP either at the above address, by facsimile at (916) 322−3154, or by calling the CHP, CVS, at (916) 843−3400.

All requests for in- formation should include the following: the title of the rulemaking package, the requester’s name, proper mail- ing address (including city, state, and zip code), and a daytime telephone number in case the information is in- complete or illegible. 1849

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z The rulemaking file is available for inspection. Inter- ested parties are advised to call CHP, CVS, for an appointment. All documents regarding the proposed action are available through the CHP’s website at https://www.chp.ca.gov/News−Alerts/Regulatory− Actions. Any person desiring to obtain a copy of the adopted text and a final statement of reasons may re- quest them at the above−noted address. Copies will also be posted on the CHP website.

CONTACT PERSON Any inquiries concerning the written materials per- taining to the proposed regulations or the substance of the proposed regulations should be directed to Dr. Tian− Ting Shih or Sergeant Adam Roha, at (916) 843−3400. ADOPTION OF PROPOSED REGULATIONS After consideration of public comments, the CHP may adopt the proposal substantially as set forth with- out further notice.

If the proposal is modified prior to adoption and the change is not solely grammatical or substantive in nature, the full text of the resulting regu- lation, with the changes clearly indicated, will be made available to the public for at least 15 days prior to the date of adoption.

FISCAL IMPACT AND RESULTS OF THE ECONOMIC IMPACT ASSESSMENT The CHP has made an initial determination that this proposed regulatory action: (1) will have no effect on housing costs; (2) will not impose any new mandate up- on local agencies or school districts; (3) will involve no nondiscretionary cost or savings to any local agency, no cost to any local agency or school district for which Government Code (GC) Sections 17500−17630 require reimbursement, no cost or savings to any state agency, nor costs or savings in federal funding to the state; (4) will neither create nor eliminate jobs in the State of Cal- ifornia, nor result in the elimination of existing busi- nesses or create or expand businesses in the State of California; and (5) will not have a significant statewide adverse economic impact directly affecting businesses, including the ability of California businesses to com- pete with businesses in other states.

Benefits of the Proposed Action: The proposed regu- lation updating designated routes for carriers transport- ing explosives will continue to provide benefits, includ- ing the nonmonetary benefit of protecting public health and safety for residents, workers, and the environment by providing a regulatory basis for enforcement efforts as they relate to safety compliance ratings. The regulated community is encouraged to respond during the comment period of this regulatory process if significant impacts are identified.

COST IMPACTS ON REPRESENTATIVE PRIV ATE PERSONS OR BUSINESSES The CHP is not aware of any cost impacts that a repre- sentative private person or business would necessarily incur in reasonable compliance with the proposed action. EFFECT ON SMALL BUSINESSES The CHP has determined that the proposed regulato- ry action will not affect small businesses. The action is intended to clarify and update the designated routes for commercial vehicles transporting explosives on high- ways. As a result, no small business will be affected by the update. ALTERNATIVES In accordance with

Section 11346.5(a)

(13) GC, the CHP must determine that no reasonable alternative con- sidered by the CHP, or otherwise identified and brought to the attention of the CHP would be more effective in carrying out the purpose for which the action is pro- posed, would be as effective and less burdensome to af- fected private persons than the proposed action, or would be more cost−effective to affected private per- sons and equally effective in implementing the statuto- ry policy or other provision of law.

The CHP invites in- terested parties to present statements or arguments with respect to alternatives to the proposed regulations dur- ing the written comment period. AUTHORITY This regulatory action is being taken pursuant to Sec- tion 31616 CVC. REFERENCE This action implements, interprets, or makes specific Sections 31303, 31304, 31601, 31602, 31607, 31611, 31614, and 31616 CVC. 1850

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z TITLE 15. DEPARTMENT OF CORRECTIONS AND REHABILITATION NOTICE IS HEREBY GIVEN that the Secretary of the California Department of Corrections and Rehabili- tation (CDCR or Department), proposes to revise Sec- tion 3075.2 of Title 15, Division 3,

Chapter 1, regarding Releases. PUBLIC HEARING Date and Time: December 5, 2018 Place: Purpose: 1:00 p.m. to 2:00 p.m. Department of Corrections and Rehabilitation Conference Room 100N 1515 S Street — North Building Sacramento, CA 95811 To receive comments about this action. PUBLIC COMMENT PERIOD The public comment period begins October 19, 2018 and closes on December 5, 2018 at 5:00 p.m. Any per- son may submit written comments by mail addressed to the primary contact person listed below, or by email to rpmb@cdcr.ca.gov, before the close of the comment pe- riod.

For questions regarding the subject matter of the regulations, call the program contact person listed below. CONTACT PERSONS Primary Contact T. Oberoi Telephone: (916) 445−2227 Regulation and Policy Management Branch P.O. Box 942883 Sacramento, CA 94283−0001 Back−Up Y. Sun Telephone: (916) 445−2269 Regulation and Policy Management Branch P.O. Box 942883 Sacramento, CA 94283−0001 Program Contact W. Mazza Accounting Services Branch Telephone: (661) 664−3417 AUTHORITY AND REFERENCE Government Code

Section 12838.5 provides that commencing July 1, 2005, CDCR succeeds to, and is vested with, all the powers, functions, duties, responsi- bilities, obligations, liabilities, and jurisdiction of abol- ished predecessor entities, such as: Department of Cor- rections, Department of the Youth Authority, and Board of Corrections. Penal Code (PC)

Section 5000 provides that com- mencing July 1, 2005, any reference to Department of Corrections in this or any code refers to the CDCR, Di- vision of Adult Operations. PC

Section 5050 provides that commencing July 1, 2005, any reference to the Director of Corrections in this or any other code refers to the Secretary of the CDCR. As of that date, the office of the Director of Cor- rections is abolished. PC

Section 5054 provides that commencing July 1, 2005, the supervision, management, and control of the State prisons, and the responsibility for the care, cus- tody, treatment, training, discipline, and employment of persons confined therein are vested in the Secretary of the CDCR. PC

Section 5055 provides that commencing July 1, 2005, all powers and duties previously granted to and imposed upon the Department of Corrections shall be exercised by the Secretary of the CDCR. PC

Section 5058 authorizes the Director to prescribe and amend rules and regulations for the administration of prisons and for the administration of the parole of persons. PC

Section 5058.3 authorizes the Director to certify in a written statement filed with Office of Administra- tive Law that operational needs of the Department re- quire adoption, amendment, or repeal of a regulation on an emergency basis. INFORMATIVE DIGEST/POLICY STATEMENT OVERVIEW Currently, regulations concerning releases indicate the Department will disburse release funds and trust ac- count balances via cash or revolving funds checks. Ad- ditionally, release funds were disbursed to inmates only upon certain types of release. In this regulatory action, the Department proposes to amend regulatory provisions pertaining to release funds. 1851

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z This action provides the following:  Changes the method for which the Department will issue release funds and trust account balances.  Improves the functionality of the form CDCR 102 Release Statement, by reorganizing and updating the information captured on the form.  Provides that staff shall provide the contractor’s cardholder terms and conditions to each person upon release.  Incorporates language acknowledging receipt of a California Identification Card, medical card, debit card, transportation voucher, or any combination thereof.  Specifies that the Department will issue release funds to all persons being “released” and not just “released upon parole”.  Adds language to include Community Correctional Facilities, and update specific situations in which inmates will be entitled to release funds, including enrollment into an alternative custody program.  Establishes a $1,000 limit to the amount of funds that will be loaded to a debit card.  Deletes the reference to the Work Furlough program that was deactivated in 2006.  Deletes the reference to the California Youth Authority which is now called the Division of Juvenile Justice.  Deletes language with specific dollar amounts and replaces with language referencing Penal Code

Section 2713.1. FORMS INCORPORATED BY REFERENCE CDCR 102 (Rev. 08/18) Release Statement SPECIFIC BENEFITS ANTICIPATED BY THE PROPOSED REGULATIONS The Department has determined that the proposed regulations may have a positive impact on inmates by assisting with the successful transition from incarcera- tion to society by getting them familiar with current technology and modern forms of managing money.

The successful transition of previously incarcerated persons may reduce recidivism which will have a positive im- pact on public safety, the health and welfare of Califor- nia’s residents, worker safety, the State’s environment, and inmates. EV ALUATION OF CONSISTENCY/COMPATIBILITY WITH EXISTING LAWS/REGULATIONS The Department must evaluate whether the proposed regulations are inconsistent or incompatible with exist- ing State regulations.

Pursuant to this evaluation, the Department has determined these proposed regulations are not inconsistent or incompatible with existing regu- lations within CCR, Title 15, Division 3. LOCAL MANDATES This action imposes no mandates on local agencies or school districts, or a mandate which requires reim- bursement of costs or savings pursuant to Government Code Sections 17500 through 17630. FISCAL IMPACT STATEMENT Cost to any local agency or school district that is required to be reimbursed: none. Cost or savings to any state agency: none. Other nondiscretionary cost or savings imposed on local agencies: none.

Cost or savings in federal funding to the State: none. EFFECT ON HOUSING COSTS The Department has made an initial determination that the proposed action will have no significant effect on housing costs. COST IMPACTS ON REPRESENTATIVE PRIV ATE PERSONS OR BUSINESSES The Department is not aware of any cost impacts that a representative private person or business would nec- essarily incur in reasonable compliance with the pro- posed action.

SIGNIFICANT STATEWIDE ADVERSE ECONOMIC IMPACT AFFECTING BUSINESSES The Department has determined that the proposed regulations will not have a significant statewide adverse economic impact directly affecting businesses, includ- ing the ability of California businesses to compete with businesses in other states. EFFECT ON SMALL BUSINESSES The Department has determined that the proposed regulations will not affect small businesses and that this 1852

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z action has no significant adverse economic impact on small businesses because they are not adversely affect- ed by the use of debit cards for issuing funds to persons released from prison. RESULTS OF ECONOMIC IMPACT ASSESSMENT The Department has determined that the proposed regulations will have no impact on the creation of new, or the elimination of existing jobs or businesses within California, or affect the expansion of businesses cur- rently doing business in California.

The Department has determined that the proposed regulations will have no effect on the state’s environment because the pro- posed regulations relate strictly to the management of issuing release funds. The Department has determined that the proposed regulations may have a positive impact on public safety for California residents, worker safety, and inmates by ensuring that inmates are successful in their transition to society. CONSIDERATION OF ALTERNATIVES In accordance with Government Code

section 11346.5, subdivision (a)(13), the Department must de- termine that no reasonable alternative it considered or that has otherwise been identified and brought to the at- tention of the agency would be more effective in carry- ing out the purpose for which the action is proposed or would be as effective and less burdensome to affected private persons than the proposed action or would be more cost−effective to affected private persons and equally effective in implementing the statutory policy or other provision of law. In proposing the revisions to

Section 3075.2, the Department considered the follow- ing alternatives: 1. Issue checks in all instances. The Department determined that issuing checks as the primary method of disbursing inmate funds was not a better alternative because checks would require the releasee to cash the check to receive their funds. Releasees often do not have a banking relationship to deposit or cash the check. Check cashing venues charge a fee to cash a check, reducing the amount available to the releasee. Banks and check cashing venues have limited business hours.

Releasees often will not have suitable identification to verify their identity for check cashing purposes. 2. Issue cash in all instances. The Department determined that issuing cash as the primary method of disbursing inmate funds was not a better alternative because it was impossible to obtain cash for several institutions. Obtaining cash is an ongoing service requiring a contract under state procurement guidelines. The Department is unable to obtain contracts for this service to all locations due to the remote locations of some of the institutions in relation to the bank’s regional cash vaults.

Utilizing institution staff to make bank runs is time−consuming, taking staff away from critical work functions for a significant portion of a work day. Due to the amount of cash transported, an armed escort would be required, taking correctional officers away from essential duties. Due to the remote location of many facilities, banking locations may be up to one hour away, requiring at least two staff members be absent from the institution up to 3 hours per bank run.

The Department invites interested persons to present statements or arguments with respect to alternatives to the proposed regulations at the scheduled hearing or during the written comment period. A V AILABILITY OF PROPOSED TEXT AND INITIAL STATEMENT OF REASONS The Department has prepared and will make avail- able the text and the Initial Statement of Reasons (ISOR) of the proposed regulations.

The rulemaking file for this regulatory action, which contains those items and all information on which the proposal is based (i.e., rulemaking file) is available to the public upon re- quest directed to the Department’s contact person. The proposed text, ISOR, and Notice of Proposed Regula- tions will also be made available on the Department’s website at http://www.cdcr.ca.gov. A V AILABILITY OF CHANGES TO PROPOSED TEXT After considering all timely and relevant comments received, the Department may adopt the proposed regu- lations substantially as described in this notice.

If the Department makes modifications which are sufficient- ly related to the originally proposed text, it will make the modified text (with the changes clearly indicated) available to the public for at least 15 days before the De- partment adopts the regulations as revised. Requests for copies of any modified regulation text should be direct- ed to the contact person indicated in this notice. The De- partment will accept written comments on the modified regulations for 15 days after the date on which they are made available. 1853

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z A V AILABILITY OF THE FINAL STATEMENT OF REASONS Following its preparation, a copy of the Final State- ment of Reasons may be obtained from the Depart- ment’s contact person. TITLE 22. DEPARTMENT OF PUBLIC HEALTH Title 22. Social Security DPH−11−009 Medical Information Breach Notice is hereby given that the California Department of Public Health (Department) is proposing the regula- tion described below.

This notice of proposed rulemak- ing commences a rulemaking to make the regulations permanent after considering all comments, objections, and recommendations regarding the regulation. PUBLIC PROCEEDINGS The Department is conducting a 45−day written pub- lic proceeding during which time any interested person or such person’s duly authorized representative may present statements, arguments or contentions (all of which are hereinafter referred to as comments) relevant to the action described in the Informative Digest/Policy Statement Overview

section of this notice. To request copies of the regulatory proposal in an al- ternate format, please write or call: Anita Shumaker, Office of Regulations, 1415 L Street Suite 500, Sacra- mento, CA 95814, at (916) 440−7718, email to Anita.Shumaker@CDPH.ca.gov or use the California Relay Service by dialing 711. WRITTEN COMMENT PERIOD Written comments pertaining to this proposal, re- gardless of the method of transmittal, must be received by Office of Regulations by 5:00 p.m. on December 8, 2018, which is hereby designated as the close of the written comment period.

Comments received after this date will not be considered timely. Written comments may be submitted as follows: 1. By email to: regulations@cdph.ca.gov. It is requested that email transmission of comments, particularly those with attachments, contain the regulation package identifier “DPH−1 1−009 Medical Information Breach” in the subject line to facilitate timely identification and review of the comment; 2. By fax transmission to: (916) 636−6220; 3. By postal service or hand delivered to: California Department of Public Health, Office of Regulations, 1415 L Street, Suite 500, Sacramento, CA 95814.

All submitted comments should include the regula- tion package identifier, “DPH−11−009 Medical Infor- mation Breach”, with the comment author’s name and email or mailing address. PUBLIC HEARING A public hearing has not been scheduled for this rule- making. However, the Department will conduct a hear- ing if a written request for a public hearing is received from any interested person, or his or her duly authorized representative, no later than 15 days prior to the close of the written comment period, pursuant to Government Code

Section 11346.8. ASSISTIVE SERVICES For individuals with disabilities, the Department will provide assistive services such as the conversion of written materials into Braille, large print, audiocassette, and computer disk. For public hearings, assistive ser- vices can include sign−language

interpretation, real− time captioning, note takes, reading or writing assis- tance. To request these assistive services, please call (916) 558−1710 (or California Relay at 711 or 1−800−735−2929), email Regulations@cdph.ca.gov or write to the Office of Regulations at the address noted above. Note: The range of assistive services available may be limited if requests are made less than 10 busi- ness days prior to a public hearing.

AUTHORITY AND REFERENCE The Department may promulgate the proposed regu- lation sections under the Department’s regulatory au- thority provided by Health and Safety Code sections 131000, 131050, 131051, 131052 and 131200. The proposed regulation sections implement, interpret, and make specific Health and Safety Code

section 1280.15. INFORMATIVE DIGEST/POLICY STATEMENT OVERVIEW

Summary of Proposal The California Department of Public Health (Depart- ment) proposes to adopt

Chapter 13 (sections 79900−79905) of Division 5, Title 22 of the California Code of Regulations to establish standards for assessing breaches of a patient’s medical information, and admin- istrative penalties related to such breaches. 1854

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z Background In 2008, Health and Safety Code

section 1280.15 (Code) was enacted. The Code requires clinics, health facilities, home health agencies, and hospices (collec- tively, the health care facilities) to prevent the unlawful or unauthorized access to, and use or disclosure of, pa- tient medical information (breaches). The Code autho- rizes the Department to assess administrative penalties against these health care facilities.

Problem Statement The Department, in its efforts to assess administrative penalties for breaches of patient medical information pursuant to the Code, requires regulations to establish a framework by which administrative penalties will be assessed in a fair and consistent manner, as well as to clarify reporting requirements for the health care facili- ties.

Objectives (Goals) of the Regulation Broad objectives of this proposed regulatory action are:  Fewer breaches of patient medical information.  Increased vigilance by health care facilities to protect patient medical information.  Closer alignment of state and federal law relating to patient medical information breaches.  Improved patient experiences for the people of California.

Anticipated Benefits  Increased security of patient medical information.  Health care facilities will be more protective of patient medical information.  Health care facilities will be more efficient in their internal data protection processes due to federal and state alignment.  Health care facilities will be more efficient in responding to breaches due to federal and state alignment.  Increased consumer confidence in the security of medical information.  Increased transparency and consistency in calculation of assessed penalties.

EV ALUATION AS TO WHETHER THE PROPOSED REGULATIONS ARE INCONSISTENT OR INCOMPATIBLE WITH EXISTING STATE AND FEDERAL REGULATIONS The Department has reviewed existing state and fed- eral regulation related or affecting this area and con- cludes that the proposed regulations are compatible or consistent with existing state and federal regulations. Under the Health Insurance Portability and Account- ability Act (HIPAA), the federal government has estab- lished provisions relating to medical information breaches.

In drafting these proposed regulations, the Department has extensively used the HIPAA regula- tions as a model for developing its own. However, in some cases the HIPAA provisions differ from the final regulations proposed herein. These differences are of- ten the result of variation between existing state and federal law as they relate to privacy and medical infor- mation (i.e. differences between underlying statutorily defined terms).

In other cases, the Department has mod- eled its regulations after HIPAA regulations, but con- structed them differently when the Department finds such changes are in the best interest of the people of Cal- ifornia. HIPAA’s provisions are meant to be a “floor’’ for patient protection standards and a state may enact its own laws and regulations under certain circumstances, including, but not limited to, when the state’s law pro- vides greater protection. (45 C.F.R. §§ 160.201−205 (2013).) Therefore, the Department concludes that the proposed regulations are consistent with existing state and federal laws.

FORMS INCORPORATED BY REFERENCE Not applicable. MANDATED BY FEDERAL LAW OR REGULATIONS Not applicable. OTHER STATUTORY REQUIREMENTS Not applicable. LOCAL MANDATE The Department has determined that this regulatory action would not impose a mandate on local agencies or school districts, nor are there any costs for which reim- bursement is required by

part 7 (commencing with Sec- tion 17500) of division 4 of the Government Code. DISCLOSURES REGARDING THE PROPOSED ACTION FISCAL IMPACT ESTIMATES

A) Cost to any local agencies or school districts that must be reimbursed pursuant to

Section 17561 of Government Code: The proposed regulations do not impose costs on 1855

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z any local agency or school district for which reimbursement would be required pursuant to

part 7 (commending with

section 17500) of division 4 of the Government Code.

B) The cost or savings to any state agency: The department estimates that the overall effect will be cost neutral as affected regulated entities are already paying the financial penalties as appropriate under existing statutes. State operated facilities may receive fines if they fail to comply with patient medical information requirements.

C) Impact on any cost or savings in federal funding of the program: There is no federal funding effected by the proposed regulatory action.

D) Other nondiscretionary costs or savings imposed on local agencies: The proposed regulations do not impose other nondiscretionary costs or savings on any local agencies. HOUSING COSTS The Department has determined that the regulations will have no impact on housing costs.

SIGNIFICANT STATEWIDE ADVERSE ECONOMIC IMPACT DIRECTLY AFFECTING BUSINESS, INCLUDING ABILITY TO COMPETE The Department has made an initial determination that these regulations would not have a significant statewide adverse economic impact directly affecting businesses, and individuals, including the ability of California businesses to compete with businesses in other states.

STATEMENT OF THE RESULTS OF THE ECONOMIC IMPACT ASSESSMENT The Department has made an initial determination that these regulations would not have a significant statewide adverse economic impact directly affecting businesses, including the ability of California business- es to compete with businesses in other states.

The pro- posed regulations would not significantly affect:  The creation or elimination of jobs within the state because the Department estimates that the regulation’s financial impact would be cost neutral and affected regulated entities are already paying the financial penalties as appropriate under existing statutes.  The creation of new businesses or the elimination of existing businesses within the state because the Department estimates that the regulation’s financial impact would be cost neutral and both existing and potential new businesses would pay similar financial penalties as appropriate under existing statutes.  The expansion of businesses currently doing business within the state because the Department estimates that the regulation’s financial impact would be cost neutral and affected regulated entities are already paying the financial penalties as appropriate under existing statutes.  The regulatory action protects the patient’s privacy rights regarding disclosures of medical information.

Maintain security standards to prevent breaches which creates a positive impact to the health, safety and welfare of California. Also, the economy is not impacted because the Department estimates that cost is neutral as affected regulated entities are already paying the financial penalties as appropriate under existing statutes. COST IMPACTS ON REPRESENTATIVE PERSON OR BUSINESS The Department is not aware of any cost impacts that a representative private person or business would nec- essarily incur in reasonable compliance with the pro- posed action.

BUSINESS REPORTING REQUIREMENT The proposed regulations require that health care fa- cilities must report to the Department details regarding unlawful or unauthorized access to patients’ medical in- formation. The Department has found that it is neces- sary for the health, safety, or welfare of the people of the state. EFFECT ON SMALL BUSINESS The Department has determined that there would be an effect on small business because small businesses will be legally required to comply with the regulation and may incur a financial penalty from the enforcement of the regulation.

Depending on the type and frequency of information breach, a penalty would vary from no cost to a potentially substantial cost. However, the proposed regulation has a mechanism to adjust costs for facilities for which penalties are a burden. 1856

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z SPECIFIC TECHNOLOGIES OR EQUIPMENT This regulation does not mandate the use of specific technologies or equipment.

ALTERNATIVES CONSIDERED The Department must determine that no reasonable alternative considered, identified, or otherwise brought to the attention of the Department would be more effec- tive in carrying out the purpose for which the action is proposed, would be as effective and less burdensome to affected private persons than the proposed action, or would be more cost−effective to affected private per- sons and equally effective in implementing the statuto- ry policy or other provision of the law.

TECHNICAL, THEORETICAL, AND/OR EMPIRICAL STUDIES, REPORTS OR DOCUMENTS RELIED UPON  Ponemon Inst., Third Annual Benchmark Study on Patient Privacy & Data Security (December 2012).  Redspin, Inc., Breach Report 2013: Protected Health Information (PHI) (February 2014).  The Health Insurance Portability and Accountability Act of 1996 (Pub.L. 104−191, 110 Stat. 1936, enacted August 21, 1996), Parts 160 and 164.  Federal Register vol 78, no. 17, Jan. 25, 2013 (Part II).  Cal. Reg. Notice Register 2012, No. 43−Z, p. 1564.  California Assn. of Health Facilities v.

Department of Health Services (1997) 16 Cal.4th 284 [65 Cal.Rptr.2d 872].  Eisenhower Medical Center v. Superior Court of Riverside County (2014) 226 Cal. App. 4th 430 [172 Cal.Rptr.3d 165]. CONTACT PERSON Inquiries regarding the substance of the proposed regulations described in this notice may be directed to Chelsea Driscoll (916) 552−8778. All other inquiries concerning the action described in this notice may be di- rected to, Anita Shumaker, Office of Regulations, at (916) 440−7718, or to the designated backup contact, Charlet Archuleta, Office of Regulations, at (916) 440−9403.

A V AILABILITY STATEMENTS The Department has prepared and has available for public review an initial statement of reasons for the pro- posed regulations, all the information upon which the proposed regulations are based, and the text of the pro- posed regulations. The Office of Regulations, at the ad- dress previously noted, will be the location of public records, including reports, documentation, and other material related to the proposed regulations.

In order to request that a copy of this public notice, the regulation text, and the initial statement of reasons or al- ternate formats for these documents be mailed to you, please call (916) 440−7718 (or the California Relay Service at 711), or send an email to regulations@cdph.ca.gov, or write to the Office of Reg- ulations at the address previously noted. Upon specific request, these documents will be made available in Braille, large print, audiocassette, or computer disk.

The full text of any regulation which is changed or modified from the express terms of the proposed action will be made available by the Department’s Office of Regulations at least 15 days prior to the date on which the Department adopts, amends, or repeals the resulting regulation. A copy of the final statement of reasons when pre- pared will be available upon request from the Office of Regulations.

INTERNET ACCESS Materials regarding the action described in this notice (including this public notice, the text of the proposed regulations, and the initial statement of reasons) that are available via the Internet may be accessed at www.cdph.ca.gov and by clicking on the following: Programs, Office of Regulations, and the Proposed Regulations link. TITLE 22.

DEPARTMENT OF PUBLIC HEALTH Title 22, California Code of Regulations DPH−17−011P — Skilled Nursing Facilities 3.5 Direct Care Hours Notice is hereby given that the California Department of Public Health (Department) is proposing the regula- tion described below. This notice of proposed rulemak- ing commences a rulemaking to make the emergency regulation permanent after considering all comments, objections, and recommendations regarding the regulation. 1857

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z PUBLIC PROCEEDINGS The Department is conducting a written comment pe- riod during which time any interested person or such person’s duly authorized representative may present statements, arguments or contentions (all of which are hereinafter referred to as comments) relevant to the ac- tion described in the Informative Digest/Policy State- ment Overview

section of this notice. PUBLIC HEARING The Department has scheduled a public hearing to ac- cept comments on the proposed action. Any person may present statements or arguments described in the Infor- mative Digest. The Department requests, but does not require, that persons who make oral comments at the hearing also submit a written copy of their testimony at the hearing. Date: December 7, 2018 Time: 9:00 a.m. to 5:00 p.m. Location: 1500 Capitol Ave, Room 146 Sacramento, CA 95814 An agenda for the public hearing will be posted at the time and place of hearing location.

WRITTEN COMMENT PERIOD Any written comments pertaining to these regula- tions, regardless of the method of transmittal, must be received by the Office of Regulations by 5 p.m. on De- cember 7, 2018, which is hereby designated as the close of the written comment period. Comments received af- ter this date will not be considered timely. Persons wish- ing to use the California Relay Service may do so at no cost by dialing 711. Written comments may be submitted as follows: 1. By email to: regulations@cdph.ca.gov .

It is requested that email transmission of comments, particularly those with attachments, contain the regulation package identifier “ DPH−17−011P− SNF 3.5 Direct Care Hours” in the subject line to facilitate timely identification and review of the comment; 2. By fax transmission to: (916) 636−6220; 3. By United States Postal Service to: California Department of Public Health, Office of Regulations, 1415 L Street, Suite 500, Sacramento, CA 95814; or 4. Hand−delivered to: California Department of Public Health, Office of Regulations, 1415 L Street, Suite 500, Sacramento, CA 95814.

All submitted comments should include the regula- tion package identifier (DPH−17−011P −SNF 3.5 Di- rect Care Hours), author’s name and mailing address. AUTHORITY AND REFERENCE The Department is proposing to amend the proposed rulemaking under the authority provided in sections 1275, 1276.5, 1276.65, and 131200, of the Health and Safety Code. The Department is proposing to implement, interpret, or make specific sections 1276, 1276.5, 1276.65, 131050, 131051, and 131052, of the Health and Safety Code; and

section 14126.022, of the Welfare and Insti- tutions Code. INFORMATIVE DIGEST/POLICY STATEMENT OVERVIEW These regulations will implement new minimum staffing requirements for skilled nursing facilities (SNFs) as established by Senate Bill (SB) 97 (Chapter 52, Statutes of 2017). This regulatory action is necessary to comply with language in the legislation directing the California De- partment of Public Health (Department) to adopt regu- lations to implement the amendments made by SB 97.

Policy Statement Overview Problem Statement: SB 97 increased the minimum staffing standard for SNFs from 3.2 nursing hours per patient day (NHPPD) to 3.5 direct care service hours per patient day (DCSHPPD), with a minimum of 2.4 hours per patient day performed by certified nurse as- sistants (CNAs). This regulatory action is necessary to implement these new minimum staffing requirements and to make permanent the emergency regulations that became effective on July 1, 2018.

Objectives: The broad objectives of this proposed regulatory action are:  To fulfill the legislative directive to adopt regulations to implement the amendments made by SB 97.  To align the Department’s regulations with changes to statute.

Benefits: The expected benefits of this proposed reg- ulatory action, including, to the extent applicable, non- monetary benefits such as the protection of public health and safety, worker safety, or the environment, the prevention of discrimination, the promotion of fairness or social equity, and the increase in openness and trans- parency in business and government, among other things, are:  To improve clarity and reduce confusion within the regulated community and for residents and 1858

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z their families by aligning the staffing standards in the Department’s regulations with the standards set by the Legislature. EV ALUATION AS TO WHETHER THE REGULATIONS ARE INCONSISTENT OR INCOMPATIBLE WITH EXISTING STATE REGULATIONS The Department evaluated whether the proposed reg- ulations are inconsistent or incompatible with existing state regulations. This evaluation included a review of the Department’s laws, as well as those statutes and reg- ulations related to SNFs.

The Department has deter- mined that this proposed regulatory action is not incon- sistent or incompatible with existing operative regula- tions. After conducting a review for any regulations that would relate to or affect staffing requirements in SNFs, the Department has concluded that no known statute or operative regulation conflicts with this proposed regu- latory action. LOCAL MANDATE The Department has determined that the proposed ac- tion would not impose a mandate on local agencies or school districts, nor are there any costs for which reim- bursement is required by

part 7 (commencing with sec- tion 17500) of division 4 of the Government Code. FISCAL IMPACT ESTIMATE A. Cost or Savings to Any State Agency: None. B. Cost to Any Local Agency or School District: None. C. Other Nondiscretionary Cost or Savings Imposed on Local Agencies: There are no known costs or savings imposed on local agencies in connection to these proposed regulations. D. Cost or Savings in Federal Funding to the State: None.

SIGNIFICANT STATEWIDE ADVERSE ECONOMIC IMPACT DIRECTLY AFFECTING BUSINESS, INCLUDING ABILITY TO COMPETE Implementation of these proposed regulations is con- tingent upon an appropriation in the annual Budget Act and continued federal approval of the Skilled Nursing Facility Quality Assurance Fee, in accordance with Health and Safety Code

section 1276.65, subdivision (i). The annual Budget Act for fiscal year 2018−19 in- cluded funding for these provisions. The Department has made an initial determination that these proposed regulations would not have a signif- icant statewide adverse economic impact directly im- pacting businesses, including the ability of California businesses to compete with businesses in other states. Jobs will not be created or eliminated in SNFs as a result of these regulations because the regulations only restate the new direct care service hour requirements found in Health and Safety Code

section 1276.65. The 2018 Budget Act includes $43 million ($21.7 million Gener- al Fund) for the SNF staffing standard “add−on” to im- plement SB 97. The add−on reimburses SNFs partici- pating in the Medi−Cal program for costs to increase their staffing levels to meet the new statutory mandated staffing standards. These regulations do not add any ad- ditional cost to the cost of the statutory change. These proposed regulations would have a minor eco- nomic impact on SNFs applying for a patient needs waiver to waive the requirement to staff at 2.4 direct care service hours per patient day for CNAs.

The De- partment will use an online application process for this waiver and proposes additional administrative require- ments for waiver applicants. These requirements in- clude renewing the patient needs waiver annually, post- ing a notice of an approved waiver in a public location within the facility, and providing written notice of ap- proved or pending waivers to potential residents. COST IMPACTS ON REPRESENTATIVE PERSON OR BUSINESS The Department is not aware of any cost impacts that a representative private person or business would nec- essarily incur in reasonable compliance with the pro- posed action.

STATEMENT OF THE RESULTS OF THE ECONOMIC IMPACT ASSESSMENT In addition, the proposed regulations would not sig- nificantly affect the following:

a) The creation or elimination of jobs within the State of California.

b) The creation of new businesses or the elimination of existing businesses within the State of California.

c) The expansion of businesses currently doing business within the State of California.

d) The health and welfare of California residents, worker safety, and the State’s environment is expected to improve clarity and reduce confusion within the regulated community and for residents and their families by aligning the staffing standards in the Department’s regulations with the standards set by the Legislature. 1859

CALIFORNIA REGULATORY NOTICE REGISTER 2018, VOLUME NO. 42-Z IMPACT ON SMALL BUSINESS DETERMINATION The Department has determined that the proposed regulations may affect small business. However, the ef- fect will not be adverse. The proposed regulatory action would impose minimal direct or indirect costs on SNFs applying for a patient needs waiver. However, there is no reimbursable or calculable cost to the provider com- munity or to the state to implement these regulations since the costs are a result of SB 97.

HOUSING COSTS DETERMINATION The Department has determined that these proposed regulations will not impact housing costs. DOCUMENTS INCORPORATED BY REFERENCE None.

CONSIDERATION OF ALTERNATIVES The Department must determine that no reasonable alternative considered by the Department or that has otherwise been identified and brought to the attention of the Department would be more effective in carrying out the purpose for which the action is proposed, would be as effective and less burdensome to affected private per- sons or SNFs than the proposed regulatory action, or would be more cost−effective to affected private per- sons or SNFs and equally effective in implementing the statutory policy, including the higher staffing require- ments established by SB 97, or other provision of law.

CONTACT PERSON Inquiries regarding the substance of the proposed regulations described in this notice may be directed to Chelsea Driscoll (916) 552−8778. All other inquiries concerning the action described in this notice may be di- rected to, Michael Boutros, Office of Regulations, at (916) 440−7822, or to the designated backup contact, Anita Shumaker, Office of Regulations, at (916) 440−7718.

A V AILABILITY OF STATEMENT OF REASONS AND TEXT OF REGULATIONS The Department has prepared and has available for public review an initial statement of reasons for the pro- posed regulations, all the information upon which the proposed regulations are based, and the text of the pro- posed regulations. The Office of Regulations, at the ad- dress noted above, will be the location of public records, including reports, documentation, and other material related to the proposed regulations (rulemaking file). In ord