At its meeting on December 20, 1991, the Joint Legislative Committee on Administrative Rules (Committee) voted, pursuant to RSA 541-A:3-e, IV, to enter a preliminary objection to Final Proposal 91-154 containing a proposed complete set of rules of the Board of Barbering, Cosmetology and Esthetics (Board). The Board responded by letter dated January 15, 1992.

At its meeting on January 31, 1992, the Committee voted, pursuant to RSA 541-A:3-e, V(c), to enter a final objection to Final Proposal 91-154. The final objection has been filed with the Director of the Office of Legislative Services for publication in the New Hampshire Rulemaking Register. The effect of a final objection is stated in RSA 541-A:3-e, VI:

Due to the complexity and number of bases for objection, some of the rules to which a final objection has been filed have not been identified in this text. Such unidentified rules, and the bases for final objection, are specified in the annotations to the rules made by the Committee's Attorney. Copies of the Board's rules with the annotations made by the Committee's Attorney can be obtained from the Office of Legislative Services, Division of Administrative Rules, Room 114 in the State House, at the normal copying rate of $0.20 per page.

The following identifies and summarizes some of the bases upon which the final objection has been entered:

1. Bar 201.02

The Committee objected that rule Bar 201.02, pursuant to RSA 541-A:3-e, IV(b) and (c), and Committee rules 402.02(b)(2), 403.01(d), and 403.02(c), is contrary to legislative intent and contrary to the public interest as discussed below.

This rule provides that "failure to comply with the rules of this chapter shall be a basis for refusing to accept a noncompliant document for filing; denying or conditionally denying a noncompliant application, petition or motion; or issuing an order adverse to a noncompliant person." The rule is clear, in the view of the Committee, as to what the options for action by the Board are, but is completely silent as to what criteria or procedure will be applied to decide which action shall be taken in any particular case. Therefore, the Committee objected that the rule is contrary to the public interest by not being clear and understandable and capable of uniform enforcement, and contrary to legislative intent by allowing requirements to be set outside the process mandated by RSA 541-A:3.

2. Bar 202.02(g)

The Committee objected that rule Bar 202.02(g), pursuant to RSA 541-A:3-e, IV(b) and (c), and Committee rules 402.02(b)(2), 403.01(d), and 403.02(c), is contrary to legislative intent and contrary to the public interest as discussed below.

This rule allows investigators appointed by the Board in disciplinary proceedings to request that a licensee submit a written response, within 10 days of the request, to any complaint made against the licensee. However, the last sentence of the paragraph states that "failure to respond to such a request shall be a separate basis for disciplining a licensee." If the response is only requested by the investigator, it would be inconsistent, in the Committee's view, to discipline a licensee for failing to comply with a mere request. Therefore, the Committee objected that the rule is contrary to the public interest by not being clear and understandable and capable of uniform enforcement, and contrary to legislative intent by allowing requirements to be set outside the process mandated by RSA 541-A:3.

3. Bar 202.03

The Committee objected that rule Bar 202.03, pursuant to RSA 541-A:3-e, IV(a), (b) and (c), and Committee rules 401.01(c), 402.02(a) and (b)(1) and (b)(2), 403.01(d), and 403.02(c), is beyond the authority of the Board, contrary to legislative intent and contrary to the public interest as discussed below.

This rule governs the disposition of complaints and allegations of misconduct. The rule provides that "after reviewing a complaint, an investigator's report, or other information concerning a particular misconduct allegation, and considering the nature of the allegation, the probable evidence, and the available financial and personnel resources, the Board may take one of the" actions that are listed in the rule.

Taken in order of occurrence in the rule, the first problem is that the rule requires the Board to consider the nature of the allegation in deciding what action it will take. This is problematic because RSA 313-A:21 states that "all complaints shall be objectively received and fairly heard by the board." [Emphasis added.] Thus, the Committee determined that an allegation of misconduct that satisfies the requirements of a complaint as found in the rules must result in a hearing. The Committee decided that the Board has no authority to order anything less, unless agreed otherwise by all the parties.

The next problem arises from the requirement that the Board consider "the probable evidence." Although much of the evidence that could be presented at a hearing might be available to an investigator or the Board before the hearing, the Committee determined that this is not a substitute for a hearing. Additionally, it is unclear to the Committee how the Board can "consider" evidence about which it is not aware. Finally, the Committee determined that this rule conflicts with RSA 313-A:21, as indicated above.

The next problem is that the rule requires the Board to consider "the available financial and personnel resources." As indicated above, the Board is required by statute to conduct a hearing on each complaint that it receives. If this provision is intended to allow something other than holding hearings on complaints, then in the view of the Committee the provision would be in violation of RSA 313-A:21.

Finally, the rule allows the Board complete discretion not only as to what action it will take, but whether any action will be taken. This is because the rule states, in essence, that the Board after considering the factors specified can choose to take the actions specified or not. The use of the word "may" is what gives the Board such complete discretion, and this is in violation of Ls-A 402.08 of the uniform system of numbering and drafting, and was determined by the Committee to conflict with RSA 313-A:21.

For all the foregoing reasons, the Committee objected that the rule is contrary to the public interest by not being clear and understandable and capable of uniform enforcement, and contrary to legislative intent by allowing requirements to be set outside the process mandated by RSA 541-A:3, conflicting with RSA 313-A:21, and conflicting with RSA 541-A:3-a, VIII, relative to the uniform system, and is beyond the authority of the Board.

4. Bar 202.06(a)

The Committee objected that rule Bar 202.06(a), pursuant to RSA 541-A:3-e, IV(b) and (c), and Committee rules 402.02(b)(2), 403.01(d), and 403.02(c), is contrary to legislative intent and contrary to the public interest as discussed below.

This rule states that "when authorized by statute or court order, persons may be compelled to provide information to the board or its agents in a formal investigation." There appears to be no provision in RSA 313-A, the statute creating and governing the Board, that allows the Board to compel the presence of persons or production of documents. Thus, it is unclear to the Committee to which statute this rule refers. Additionally, the Committee determined that the language about a court order is unnecessary because a court does not derive its power to compel the attendance of persons or the production of information from these rules; the courts have that power regardless of what these rules state. Finally, the Committee concluded that the use of the word "may" makes the rule unclear because it allows a person to disregard such statute or order. Therefore, the Committee objected that the rule is contrary to the public interest by not being clear and understandable and capable of uniform enforcement, and contrary to legislative intent by allowing requirements to be set outside the process mandated by RSA 541-A:3.

5. Bar 203.02

The Committee objected that rule Bar 203.02, pursuant to RSA 541-A:3-e, IV(a), (b) and (c), and Committee rules 401.01(c), 402.02(b)(2), 403.01(d), and 403.02(c) is beyond the authority of the Board, contrary to legislative intent and contrary to the public interest as discussed below.

This rule governs the granting of motions to change the time periods specified in these rules. The rule states that "a motion for change of time shall be granted upon a finding of due diligence and probable injury to the moving party which outweighs any detriment likely to be suffered by any other party to the proceeding or the public."

The term "due diligence" has not been defined, and it is possible that no two participants, including the Board and the parties, will have the same understanding of what this term means or requires. This source of confusion, and unlimited discretion for the Board, could have been removed, in the Committee's view, only by defining the term.

The requirement that the Board consider "any detriment likely to be suffered by...the public" raises an issue of authority. When a hearing is scheduled and held, the only interests that are adjudicated are those of the parties and the Board. It is unclear to the Committee what "detriment" the public could suffer if the hearing date or time were changed by the Board. The only requirements that the Board must meet with respect to the public is that such hearings be open to the public. Considering the "detriment" to the public appears to be entirely inappropriate and beyond the authority of the Board.

Therefore, the Committee objected that the rule is contrary to the public interest by not being clear and understandable and capable of uniform enforcement and contrary to legislative intent by allowing requirements to be set outside the process mandated by RSA 541-A:3, and is beyond the authority of the Board.

6. Bar 204.03(b)

The Committee objected that rule Bar 204.03(b), pursuant to RSA 541-A:3-e, IV(b), (c) and (d), and Committee rules 402.02(b)(1) and (b)(2), 403.01(d) and (f), 403.02(c) and 404.01(a)(1) and (4), is contrary to legislative intent, contrary to the public interest and has a substantial economic impact not accounted for in the Fiscal Impact Statement as discussed below.

This section governs the service of documents in proceedings before the Board. This rule states that "petitions for rulemaking and petitions for declaratory rulings shall be filed without service upon other persons. Provided, however, that when the relief sought would clearly and directly affect the interests of a person or group of persons, the board shall, by order, require service upon the affected person or persons." This provision has been included with the adjudicative hearing procedure rules, even though it is entirely unrelated to such hearings. The Committee concluded that inclusion of such an unrelated provision in this section renders the rule not clear and understandable and incapable of uniform application. However, even putting aside the issue of its placement in the chapter, the rule still has significant problems, in the Committee's view.

A declaratory ruling is defined by RSA 541-A:1, IV, as "an agency ruling as to the specific applicability of any statutory provision or of any rule or order of the agency." This process gives a person licensed by or registered with the Board the opportunity to receive a ruling as to whether or how a requirement, prohibition, or limitation contained in a statute, rule or order of the Board must be complied with by the licensee or registrant. Such rulings are binding upon the particular licensee or registrant who requested the ruling, but are not binding upon any other person. Thus, it is unclear to the Committee how a petition for a declaratory ruling could ever "clearly and directly" affect the interests of those who did not request the ruling. [Emphasis added.] Additionally, the rule does not indicate what must be true for relief to "clearly and directly" affect the interests of others.

The Committee determined that the provision of the rule requiring that the petitioner for rulemaking provide notice to all others who will be affected by the relief sought is inconsistent with the intent of RSA 541-A, and designed to benefit the administrative convenience of the Board by placing a duty of the Board upon the petitioner. If the Board were to decide to deny a petition, the denial cannot result in the interests of any other person being affected, as a denial means that the status quo would be preserved and notice to others appears to be completely unnecessary. Even if the Board were to decide to grant the petition for rulemaking, RSA 541-A:3, I, requires the Board to provide notice through the Rulemaking Register. Additionally, those affected always have an opportunity to comment upon the substance of the rulemaking proceeding whether it was initiated by a petition or the Board. In the event that the comment received convinces the Board that the rule should not be adopted, amended or repealed, the Board could simply withdraw the proposal.

The Committee determined that requiring the petitioner to provide notice to all those who would be clearly and directly affected raises a problem with respect to having a fiscal impact not accounted for in the fiscal impact statement. The Board has issued more than 12,000 licenses, with more than 7,000 of those being for cosmetologists. Thus, if a person were to petition for rulemaking relative to the qualifications for licensure as a cosmetologist, for example, the person would be required to send out more than 7,000 such notices. The Committee concluded that the expense involved with such an undertaking would be rather substantial and could discourage those who might otherwise petition the Board. Pursuant to RSA 541-A:3-a, I(d)(1) and (4), an agency must submit information regarding the costs and benefits to the citizens, and a comparison of the costs of the proposed rule with the cost of the existing rule, respectively. This information must be submitted to the Legislative Budget Assistant to allow him to prepare a fiscal impact statement which identifies all the costs and benefits associated with the proposed rules. However, neither the fiscal impact statement nor the amended fiscal impact statement address the costs associated with providing such notice to all other persons affected, nor do they compare the costs of the existing rule (which did not contain this requirement) with the costs of the proposed rule.

Based upon the foregoing, the Committee objected that the rule is contrary to the public interest by not being clear and understandable and capable of uniform enforcement, contrary to legislative intent by allowing requirements to be set outside the process mandated by RSA 541-A:3 and by conflicting with RSA 541-A:3-a, I(d)(1) and (4), and by being designed to benefit the administrative convenience of the Board to the detriment of the public.

7. Bar 205.01(e)

The Committee objected that rule Bar 205.01(e), pursuant to RSA 541-A:3-e, IV(b) and (c), and Committee rules 402.02(b)(2), 403.01(d), and 403.02(c) is contrary to legislative intent and contrary to the public interest as discussed below.

This rule states that "any fact contained in a petition which is not denied in a reply, shall be presumed to deny all allegation in the reply, and no response shall be permitted to the reply." [Sic] This sentence appears to be two sentences, but are combined in such a way as to make no sense in the Committee's view. The first part of the sentence may be intended to state, in substance, that facts not denied by the respondent in the reply shall be deemed to be admitted by the respondent. The second sentence may be intended to state, in substance, that the complainant shall be presumed to have denied all allegations of fact contained in the reply that are different from the allegations of fact in the complaint. However, the Committee determined that the intent of the rule is simply unclear. Therefore, the Committee objected that the rule is contrary to the public interest by not being clear and understandable and capable of uniform enforcement and contrary to legislative intent by allowing requirements to be set outside the process mandated by RSA 541-A:3.

8. Bar 206.02(b)(1)

The Committee objected that rule Bar 206.02(b)(1), pursuant to RSA 541-A:3-e, IV(b), and Committee rule 402.02(a), is contrary to legislative intent as discussed below.

This rule governs the commencement of an adjudicative proceeding, and paragraph (b) specifies what the notice for such a proceeding must contain. Subparagraph (1) specifies that the notice must, among other things, "specify a deadline for the submission of the petitions to intervene." Pursuant to RSA 541-A:17, I, petitions for intervention must be granted if the three conditions in the statute have been met. If any of the conditions have not been met, then the provisions of RSA 541-A:17, II, apply. Pursuant to those provisions, agencies must grant petitions for intervention "at any time" if the petition complies with rules adopted by the agency to determine whether the intervention would be consistent with the interests of justice and would not impair the orderly and prompt conduct of the hearing. Thus, the Committee determined that it appeared to be inconsistent with RSA 541-A:17 to specify a deadline for intervention petitions. Therefore, the Committee objected that the rule is contrary to legislative intent by conflicting with RSA 541-A:17.

9. Bar 206.07(b)

The Committee objected that rule Bar 206.02(b)(1), pursuant to RSA 541-A:3-e, IV(b), and Committee rules 402.01(c) and 402.02(a), is contrary to legislative intent as discussed below.

This section governs discovery of information by the parties. Adjudicative proceedings governed by RSA 541-A:16 et seq. appear, in the view of the Committee, to be intended to be less formal than proceedings in district or superior court. Superior Court Rule 35b.(1), relative to discovery, provides that virtually everything is discoverable in civil proceedings, even if the material sought would not be admissible but is calculated to lead to the discovery of admissible evidence. The major area of exclusion is that most materials prepared in anticipation of litigation are not discoverable unless certain conditions are met. By way of contrast, Bar 206.07(b) provides, in pertinent part, that parties seeking discovery shall "by motion, seek leave to do so and shall identify the exact type of discovery requested," but that "discovery shall be permitted when the subject matter of the proceeding is so complex that the parties will be unable to address the issues adequately at the time fixed for the presentation of evidence without an opportunity to acquire information pursuant to discovery." Thus, the Committee determined that the hearing process is intended to be less formal than civil proceedings in superior court, but since this rule actually imposes greater formality and a higher standard for obtaining discovery than the superior court, the rule violates the overall purpose of RSA 541-A:16 et seq.

There are specific aspects of RSA 541-A that appeared in the Committee's view to be violated by such a restrictive provision. Pursuant to RSA 541-A:18, II, agencies are prohibited from applying the rules of evidence in an adjudicative proceeding, (except that agencies are required to give effect to the rules of privilege recognized by law). As discussed above, the superior court rule relative to discovery even allows the discovery of inadmissible evidence if it will reasonably lead the party to evidence that is admissible. When RSA 541-A:18, II, is applied, it is clear to the Committee that inadmissibility of evidence is virtually irrelevant to adjudicative proceedings, and that, aside from discovery of privileged materials, there should be no limitation of discovery.

Additionally, pursuant to RSA 541-A:16, IV, in the course of the hearing "opportunity shall be afforded all parties to respond and present evidence and argument on all issues involved" in the hearing. Similarly, RSA 541-A:18, IV, provides that parties are entitled to "conduct cross-examinations required for a full and true disclosure of the facts." If discovery is not available, it may prove to be impossible for the party to respond or present evidence on all the issues. For example, if the evidence sought by a party is in the sole possession of his or her adversary, without discovery the evidence could, in effect, be suppressed by the adversary. In a party's cross-examination of an adversary's witness, the party could be prevented from conducting its crossexamination to provide the Board with a "full and true disclosure of the facts" if the party is prevented from discovering information relative to the case.

Therefore, the Committee objected that the rule is contrary to legislative intent by conflicting with the overall purpose of RSA 541-A:16 through 21, and by conflicting with RSA 541-A:16, IV, RSA 541-A:18, II, and RSA 541-A:18, IV.

10. Bar 206.08(b)

The Committee objected that rule Bar 206.08(b), pursuant to RSA 541-A:3-e, IV(b) and (c), and Committee rules 402.02(a) and (b)(2), 403.01(d) and 403.02(c), is contrary to legislative intent and contrary to the public interest as discussed below.

In the final proposal this rule stated that "all information which will reasonably assist the board arrive [sic] at the truth is admissible, but data which is irrelevant, unreliable, or other wise lacking in probative value, repetitions [sic] or cumulative; or needlessly insulting, hostile or scandalous may be excluded." Pursuant to RSA 541-A:18, II, the only evidence that can be excluded by the presiding officer is evidence which is "irrelevant, immaterial or unduly repetitious." All other evidence cannot be excluded. Even evidence which is "unreliable," "lacking in probative value," "needlessly insulting," "hostile," or "scandalous," putting aside questions as to what these terms mean in practice, cannot be excluded without violating RSA 541-A:18, II. Therefore, the Committee entered a preliminary objection that the rule is contrary to the public interest by not being clear and understandable and capable of uniform enforcement and contrary to legislative intent by allowing requirements to be set outside the process mandated by RSA 541-A:3, and by conflicting with RSA 541-A:18, II.

The rule was amended in the response to state that "all information which will reasonably assist the board arrive at the truth is admissible, but data which is privileged, irrelevant, immaterial, unduly repetitious, clearly lacking in probative value, or needlessly insulting, hostile or scandalous may be excluded."

As indicated above, pursuant to RSA 541-A:18, II, the only evidence that can be excluded by the presiding officer is evidence which is "irrelevant, immaterial or unduly repetitious;" all other evidence cannot be excluded. The Committee entered the final objection using the same bases as in the preliminary objection.

11. Bar 206.08(f)

The Committee objected that rule Bar 206.08(f), pursuant to RSA 541-A:3-e, IV(b), and Committee rule 402.02(a), is contrary to legislative intent as discussed below.

This rule requires that the Board have each hearing recorded on audio tape or recorded stenographically. The rule further provides that "if the board elects to transcribe the record, copies of the transcription shall be available to the parties only through the stenographer who made the transcription." However, pursuant to RSA 91-A:4, IV, "every public body or agency shall, upon request for any public record reasonably described, make available for inspection and copying any such public record within its files when such records are immediately available for such release." The Committee concluded that if the Board has received a copy of the transcript, such would constitute a public record, since it is a record of an official proceeding open to the public, and should be available for public inspection and copying. A rule of an agency which requires a person to obtain a copy of a public record from another source and which provides that such record shall not be available from the agency appears to the Committee to be in violation of RSA 91-A:1, IV. Therefore, the Committee objected that the rule is contrary to legislative intent by conflicting with RSA 91-A:4, IV.

12. Bar 206.10(d)

The Committee objected that rule Bar 206.10(d), pursuant to RSA 541-A:3-e, IV(a), (b) and (c), and Committee rules 401.01(c), 402.02(b)(2), 403.01(d), and 403.02(c) is beyond the authority of the Board, contrary to legislative intent and contrary to the public interest as discussed below.

This section, formerly numbered as Bar 206.11 in the final proposal, provides the various types of adjudicative proceedings that the Board can order be held. As indicated in the annotations to the rule, the Committee concluded that the Board has no authority to order anything other than a trial-type evidentiary hearing. The following provision was added in the proposed rule: "the foregoing subsections shall not limit the board's authority to structure a proceeding in manner [sic] suitable to its subject matter, or to require the submission of additional information at any time, including the ordering of supplemental hearings."

The Committee determined that this provision has the effect of allowing the Board not only to ignore the statutory requirements relative to conducting hearings that provide for live witnesses, among other things, but also to waive its own rules as to how the hearing shall be conducted. The Committee concluded that waivers can only be granted for rights agreed to be foregone by parties or for requirements the Board has placed upon itself through its rules, but only if the parties agreed or their rights were not affected by such a waiver. Thus, the Board could not grant, in the view of the Committee, a waiver that would result in a party's rights being violated or curtailed in some way unless the party so affected agreed. The use of a waiver requires that the Board have criteria and procedure for determining when it shall grant a request by a party or request that the parties agree to a waiver. These rules lack such provisions, and in the Committee's view this violated RSA 541-A:2, I(b), relative to adopting rules of practice and procedure, and RSA 541-A:3 relative to following the requirements for adopting rules, and RSA 541-A:12, IV, relative to requiring that the procedure for granting waivers be adopted as rules.

Another problem with this rule is that the Board has granted itself the power to compel parties to a hearing to provide "additional information." This provision, that the Board may "require the submission of additional information," is synonymous with subpoena power. However, the Committee determined that the Board does not have subpoena power.

Based upon the foregoing, the Committee objected that the rule was contrary to the public interest by not being clear and understandable and capable of uniform enforcement, contrary to legislative intent by allowing requirements to be set outside the process mandated by RSA 541-A:3, by conflicting with RSA 541-A:2, I(b), and by conflicting with RSA 541-A:12, IV, and was beyond the authority of the Board.