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RULE PROPOSAL
VOLUME 43, ISSUE 15
ISSUE DATE: AUGUST 1, 2011
LAW AND PUBLIC SAFETY
DIVISION OF CONSUMER AFFAIRS
UNIFORM REGULATIONS

Proposed New Rules: N.J.A.C. 13:45C-2 and 3
Waivers; Performance-Based Outcomes
 
Authorized By: Paula T. Dow, Attorney General.
Authority: N.J.S.A. 5:8-6, 45:1-17(b), 49:3-67 and 52:17B-137.
 
[page=1817] Calendar Reference: See Summary below for explanation of exception to calendar requirement.
Proposal Number: PRN 2011-160.
 
Submit written comments by September 30, 2011 to:
   Thomas R. Calcagni
   Acting Director
   New Jersey Division of Consumer Affairs
   124 Halsey Street
   P.O. Box 45027
   Newark, NJ 07101
 
The agency proposal follows:
 
Summary
The proposed new rules are intended to implement paragraphs 1c and f of Governor Christie's Executive Order No. 2, January 20, 2010 (EO#2).

Proposed new Subchapter 2 authorizes the Division of Consumer Affairs (Division), all boards, committees and units within the Division and the Legalized Games of Chance Control Commission (Commission) to waive specific regulatory requirements, for reasons of undue hardship, economic or otherwise, at the request of their licensees, applicants and regulated persons and businesses, so long as the waiver is consistent with the underlying purposes of the agency's laws and rules and sought in a timely manner. Units within the Division include, for example, the Bureau of Securities, the Charities Registration Unit, and the Office of Weights and Measures. It also authorizes the Division and the Commission to waive their regulatory requirements on their own initiative if the consequence of strict compliance with the rules, or parts of the rules, in a particular instance, would lead to a burdensome, unfair or incongruous result or would endanger the health, safety and welfare of the general public.

N.J.A.C. 13:45C-2.1 sets forth the scope of the proposed new rule and N.J.A.C. 13:45C-2.2 contains definitions of words and terms used in the subchapter. N.J.A.C. 13:45C-2.3 permits a licensee or applicant to submit a written request to the relevant agency for a waiver of specific regulatory requirements and prescribes the contents of the request. It also authorizes an agency, even in the absence of a request, to waive its regulatory requirements if the consequence of strict compliance with the rules, or parts of the rules, in a particular instance, would lead to a burdensome, unfair or incongruous result or would endanger the health, safety and welfare of the general public.

N.J.A.C. 13:45C-2.4 permits a person whose commercial or not-for-profit activities are subject to, or regulated by the Division or the Commission to submit a written request to the agency for a waiver of specific regulatory requirements and prescribes the contents of the request. It also authorizes the Division or the Commission, even in the absence of a request, to waive a regulatory requirement if the consequence of strict compliance with the rules, or parts of the rules, in a particular instance, would lead to an unfair or incongruous result or would endanger the health, safety and welfare of the general public.

Proposed new Subchapter 3, concerning performance based outcomes, is intended to implement paragraph 3f of EO#2, which directs State agencies to "take action to cultivate an approach to regulations that values performance-based outcomes and compliance, over the punitive imposition of penalties for technical violations that do not result in negative impacts to the public health, safety or environment."

N.J.A.C. 13:45C-3.1 sets forth the scope and applicability of the proposed new rule and N.J.A.C. 13:45C-3.2 contains definitions of words and terms used in the subchapter. N.J.A.C. 13:45C-3.3(a) authorizes the Division, including each unit within the Division; each professional or occupational licensing board or committee; and the Commission, having found a basis on which to commence an enforcement proceeding, to pursue measures to encourage compliance with the agency's rules rather than seek disciplinary sanctions or penalties. N.J.A.C. 13:45C-3.3(b) lists factors that the agency may consider in determining whether non-punitive measures are appropriate. N.J.A.C. 13:45C-3.3(c) lists some of the available measures to encourage compliance. N.J.A.C. 13:45C-3.3(d) preserves an agency's authority to take any action authorized by law.

A 60-day comment period is provided for this notice of proposal and, therefore, this notice is excepted from the rulemaking calendar requirements pursuant to N.J.A.C. 1:30-3.3.
 
Social Impact
The proposed new rules will help create an environment that is an attractive venue for individuals and entities doing, or seeking to do, business in the State.
 
Economic Impact
The proposed new rules will help create an atmosphere in which licensees, applicants, businesses and consumers are not unduly burdened by regulatory requirements and in which they may avail themselves of the process to encourage compliance rather than be subject to fines and penalties.
 
Federal Standards Statement
A Federal standards analysis is not required because the proposed new rules are not subject to any Federal standards or requirements.
 
Jobs Impact
The proposed new rules are expected to enhance the business climate in the State and may encourage businesses to locate, and new businesses to be established, in New Jersey. It is anticipated that businesses will be encouraged to grow and create and sustain jobs.
 
Agriculture Industry Impact
The proposed new rules will have no impact on the agriculture industry in the State.
 
Regulatory Flexibility Statement
A regulatory flexibility analysis is not required because the proposed new rules do not impose reporting, recordkeeping or other compliance requirements on small businesses, as discussed in the Summary above. The proposed new rules authorize waivers from strict compliance with rules and the use of measures to encourage compliance rather than the punitive imposition of penalties.
 
Smart Growth Impact
The Division does not believe that the proposed new rules will have any impact upon the achievement of smart growth or upon the implementation of the State Development and Redevelopment Plan.
 
Housing Affordability Impact Analysis
The proposed new rules will have an insignificant impact on affordable housing in New Jersey and it is extremely unlikely that the rules would evoke a change in the average costs associated with housing because the proposed rules concern waivers from strict compliance with rules and the use of measures to encourage compliance rather than the punitive imposition of penalties.
 
Smart Growth Development Impact Analysis
The proposed new rules will have an insignificant impact on smart growth and it is extremely unlikely that the rules would evoke a change in housing production in Planning Areas 1 or 2, or within designated centers, under the State Development and Redevelopment Plan in New Jersey because the proposed rules concern waivers from strict compliance with rules and the use of measures to encourage compliance rather than the punitive imposition of penalties.
 
Full text of the proposed new rules follows:
 
SUBCHAPTER 2.    WAIVERS FROM REGULATORY REQUIREMENTS; APPLICATION
 
13:45C-2.1   Applicability; scope
 
The rules in this subchapter shall apply to all licensees of the Division of Consumer Affairs, of any board, committee or unit within the Division of Consumer Affairs, and of the Legalized Games of Chance Control Commission; to all applicants for licensure by the Division, such boards, committees or units or the Commission; and to persons whose conduct is subject to, or regulated by, the laws and rules administered by the Division of Consumer Affairs, by any board, committee or unit within the Division of Consumer Affairs or by the Commission. For the purposes of this subchapter, units within the Division include, for example, the Bureau of Securities, the Charities Registration Unit and the Office of Weights and Measures.
 
[page=1818] 13:45C-2.2 Definitions
 
For purposes of this subchapter, the following words shall have the following meaning, unless the context indicates otherwise:
 
"Agency" means:
 
1. The Division;
 
2. Any professional or occupational licensing board, committee or subunit of a board or committee located within the Division; or
 
3. The Commission.
 
"Applicant" means any person applying for a license, permit, certificate or registration issued by an agency.
 
"Commission" means the Legalized Games of Chance Control Commission.
 
"Division" means the Division of Consumer Affairs and all units within the Division of Consumer Affairs, including, without limitation the Bureau of Securities, the Charities Registration Unit and the Office of Weights and Measures.
 
"Licensee" means any licensee, permittee, certificate holder or registrant of an agency.
 
"Person" means any natural person, partnership, corporation, company, association or other business or non-profit entity.
 
"Regulated person" means a person, other than an applicant or licensee, whose commercial or not-for-profit activities are subject to, or regulated by, the laws and rules administered by an agency.
 
13:45C-2.3   Application for waiver request by licensee or applicant
 
(a) A licensee or an applicant may apply to an agency for a waiver or relaxation of a specific regulatory requirement when strict compliance with that requirement would lead to an unfair, burdensome or incongruous result; would conflict with the rules of another agency; or would result in undue hardship, economic or otherwise, provided that the waiver or relaxation of the regulatory requirements would not unduly burden any affected parties, and that the waiver is consistent with the underlying purposes of the agency's laws and rules.
 
(b) A licensee or an applicant shall submit a waiver request in writing which shall be timely and shall include the following:
 
1. The specific rule(s) or part(s) of the rule(s) for which the waiver is requested;
 
2. The reasons for requesting the waiver, including a statement detailing the hardship that would result to the licensee or applicant if the waiver is not approved; and
 
3. Documentation that supports the licensee's or applicant's request for the waiver, if applicable.
 
(c) Absent a request for a waiver, an agency may waive or relax its regulatory requirements on its own initiative if the consequence of requiring strict compliance with the rules, or parts of the rules, in a particular instance, would lead to an unfair, burdensome or incongruous result, or would endanger the health, safety and welfare of the general public.
 
13:45C-2.4   Application for waiver request by regulated person
 
(a) A regulated person may apply to an agency for a waiver or relaxation of a specific regulatory requirement when strict compliance with that requirement would conflict with the rules of another agency, would be unduly burdensome or would result in undue hardship, economic or otherwise, provided that the waiver or relaxation of the regulatory requirements would not unduly burden any affected parties, and that the waiver is consistent with the underlying purposes of the agency's laws and regulations.
 
(b) A regulated person shall submit a waiver request in writing, which shall be timely and shall include the following:
 
1. The specific rule(s) or part(s) of the rule(s) for which the waiver is requested;
 
2. The reasons for requesting the waiver, including a statement detailing the hardship that would result to the regulated person if the waiver is not approved; and
 
3. Documentation that supports the regulated person's request for the waiver, if applicable.
 
(c) Absent a request for a waiver, an agency may waive or relax its regulatory requirements on its own initiative if the consequence of strict compliance with the rules, or parts of the rules, in a particular instance, would lead to an unfair, burdensome or incongruous result, or would endanger the health, safety and welfare of the general public.
 
13:45C-2.5   Agency authority not limited
 
Nothing contained in this subchapter shall limit, diminish or abrogate the authority of an agency to take such action as is available to it under applicable law or agency rule.
 
SUBCHAPTER 3.    PERFORMANCE-BASED OUTCOMES
 
13:45C-3.1   Applicability; scope
 
The rules in this subchapter shall apply to alleged violations of the rules and regulations of the Division of Consumer Affairs, each board, committee and unit within the Division of Consumer Affairs and the Legalized Games of Chance Control Commission. For the purposes of this subchapter, units within the Division include, for example, the Bureau of Securities, the Charities Registration Unit and the Office of Weights and Measures.
 
13:45C-3.2   Definitions
 
For purposes of this subchapter, the following words shall have the following meaning, unless the context indicates otherwise:
 
"Agency" means:
 
1. The Division;
 
2. Any professional or occupational licensing board, committee or subunit of a board or committee located within the Division; or
 
3. The Legalized Games of Chance Control Commission.
 
"Charging document" means a document issued by an agency to commence an enforcement action including, but not limited to, an administrative complaint, provisional order of discipline, notice of violation or uniform penalty letter.
 
"Division" means the Division of Consumer Affairs and all units within the Division of Consumer Affairs, including, without limitation the Bureau of Securities, the Charities Registration Unit and the Office of Weights and Measures.
 
"Licensee" means any licensee, permittee, certificate holder or registrant of an agency.
 
"Person" means any natural person, partnership, corporation, company, association or other business or non-profit entity.
 
"Regulated person" means a person, other than an applicant or licensee, whose commercial or not-for-profit activities are subject to, or regulated by, the laws and rules administered by an agency.
 
13:45C-3.3   Resolving alleged violations without enforcement proceedings
 
(a) An agency that finds that there is a basis on which to file or issue a charging document to commence an enforcement proceeding against a person, at its discretion in appropriate circumstances and consistent with applicable law, may pursue measures to encourage the person to comply with the agency's rules rather than impose discipline or penalties.
 
(b) In exercising its discretion, the agency may consider, by way of example and not limitation, the following:
 
1. Whether the person made a good faith effort to comply;
 
2. The impact of the alleged violation on the quality of the product or service provided;
 
3. The impact of the alleged violation on the consumer for whom the product or service was provided;
 
4. The impact of the alleged violation on the public health, safety and welfare;
 
5. Whether the alleged violation is a first time violation or the same or similar to violations previously committed by the person;
 
6. Whether the alleged violation is isolated paperwork or procedural regulatory noncompliance; or
 
7. The seriousness of the alleged violation.
 
(c) Examples of agency measures to encourage compliance shall include, but not be limited to:
 
1. Issuing a letter of admonition or other warning to the alleged violator, which, unless otherwise provided by law, shall not be public information;
 
2. Suspending the obligation to pay fines or penalties subject to continuing compliance with agency rules;
 
[page=1819] 3. Obtaining the agreement of the alleged violator, as a condition for continued, reinstated or renewed licensure, to secure medical or such other professional treatment as may be necessary to properly discharge licensee functions;
 
4. Obtaining the agreement of the alleged violator, as a condition for continued, reinstated or renewed licensure, to submit to any medical or diagnostic testing and monitoring or psychological evaluation that may be required to evaluate whether continued practice may jeopardize the safety and welfare of the public;
 
5. Obtaining the agreement of the alleged violator, as a condition for continued, reinstated or renewed licensure, to submit to an assessment of skills to determine whether the licensee can continue to practice with reasonable skill and safety, and to take and successfully complete educational training determined by the agency to be necessary;
 
6. Obtaining the agreement of the alleged violator to undergo corrective training or instruction;
 
7. Obtaining the agreement of the alleged violator to participate in consumer outreach programs conducted by the Division and to speak on topics selected by the Division; and
 
8. Obtaining the agreement of the alleged violator to contribute to the consumer fraud education fund.
 
(d) Nothing contained in this subchapter shall limit, diminish or abrogate the authority of an agency in the event of a violation to take such action as is available to it under applicable law or agency rule.

   
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