Knowing that the IHRC's system WAS "detrimental to the horse racing community" and considering the general lack of any appreciable implementation of those recommendations by the IHRC led certain legislators to create aspects of SB 609 to force the IHRC's hand to reform their procedures. Or, so those certain legislators thought. This month's Administrative Rule of the Month takes a look at '71 IAC 10-3-20 Administrative complaints' which was an administrative rule highlighted in the IG's report and targeted by changes in SB 609. But first, let's look at how SB 609 modified certain aspects of the IHRC's authority.
In reviewing any change to the law, keep in mind that, once modified, the law cannot have the same meaning as before the change. With that in mind, consider the language that SB 609 strikes from the IHRC's authority to penalize horsemen for medication violations. Effective January 1, 2014, the following change will be made to a portion of the 'Medication of Race Horses' section of Indiana law:
SECTION 8. IC 4-31-12-16 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2014]: Sec. 16. The commission
(1) Revocation of a license held by the licensee.
(2) Suspension of a license held by the licensee.
(3) A civil penalty not to exceed five thousand dollars ($5,000).
One of the concerns that the IG had regarding adjudication of penalties at the IHRC was the lack of involvement of the commission, meaning the commissioners themselves, in lieu of the Executive Director ("the commission's designee"). The IG's report expressed a concern that having to navigate through multiple levels of the IHRC staff is essentially ".....the same persons (or their co-workers) who have issued the violations, thereby challenging the appearance of impartiality." The IG also felt that "this current procedure loses the independence the HRC Commission could add by being the adjudicating body." SB 609 eliminates the IHRC from being able to create rules to delegate their authority to fine a horseman or to revoke or to suspend a license. While the judges and stewards will have authority to issue fines and suspensions for violations, the Executive Director will not, or might we say, should not, given the changes to the law.
In addition, SB 609 strikes from the law the language "or in addition to a penalty assessed by the stewards and judges." Normally, most violations are of the variety of small fines and minor suspensions. Beginning January 1, 2014, if the judges or stewards create a ruling on an alleged violation, neither the Executive Director nor the commissioners can increase that penalty, or might we say, should not, given the changes to the law.
There is also a similar change in the portion of the IHRC's authorizing statute regarding "Offenses and Enforcement" for non-medication violations. You'll see that effective January, 1, 2014, the commission cannot delegate to the Executive Director ("the commission's designee") the ability to penalize a horseman. In addition, the commissioners will not have the authority to increase penalties for non-medication violations issued by the judges or stewards. Here's how the law will read:
SECTION 9. IC 4-31-13-1 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2014]: Sec. 1. (a) The commission
(1)
(2) impose civil penalties, in addition to any other penalty imposed by the commission on a person who violates this article or a rule or an order of the commission.
(b) The commission or the commission's designee, as determined under the rules of the commission, on its own motion or in addition to a penalty assessed by the stewards and judges, may issue orders under IC 4-21.5 to rule a person off one (1) or more permit holders' premises, if necessary in the public interest to maintain proper control over recognized meetings.
At their September 17, 2013 meeting, the commissioners were presented with and approved emergency rules that were characterized by the IHRC's General Counsel Lea Ellingwood as "the administrative rules that we believed would require some kind of adjustment, amendment, or creation" given the changes in the law. One of those changes, which is copied below, was to '71 IAC 10-2-3 Summary suspension' which is a suspension of license without a hearing. What you will see is that subsection (d), which delegates the commission's authority to summarily suspend a license to the Executive Director, is being removed from the administrative rule book. Eliminating the Executive Director's authority within this disciplinary process and the duplication of the process was what the IG had recommended. Here's how the rule was presented to the commissioners:
71 IAC 10-2-3 Summary suspension
Authority: IC 4-31-3-9
Affected: IC 4-21.5-4; IC 4-31-13
Sec. 3. (a) If the judges determine that a licensee's actions constitute an immediate danger to the public health, safety, or welfare, or are not in the best interest of racing, or compromise the integrity of operations at a track or satellite facility, the judges may summarily suspend the license pending a hearing pursuant to the provisions of IC 4-21.5-4.
(b) A licensee whose license has been summarily suspended by the judges is entitled to a hearing following a written request by the licensee.
(c) The judges shall conduct a hearing on the summary suspension in the same manner as other disciplinary hearings. At a hearing on a summary suspension, the sole issue is whether the licensee's license should remain suspended pending a final disciplinary hearing and ruling.
However, we don't think the changes to 71 IAC 10-2-3 go far enough. To understand this statement, you'd have to read our Administrative Rule of the Month from July: (http://ibopindy.blogspot.com/2013/07/administrative-rule-of-month-71-iac-10.html). We had our suspicions that the IHRC wouldn't voluntarily modify a certain aspect of '71 IAC 10-2-3 Summary Suspension' to conform with what is required by SB 609. We'll make certain legislators aware, yet, the summary suspension is not this month's rule of the month, remember it's '71 IAC 10-3-20 Administrative Complaints.' The impression given by Ms. Ellingwood at the last commission meeting indicated that the staff's review of the administrative rules for SB 609-related changes is complete. We see their review as far from over and that is where the "Administrative Complaints" rule comes into play.
Prior to the IG's report, 71 IAC 10-3-20 was titled as "Preliminary reports" instead of "Administrative complaints." In his report, the IG stated, "We also recommend the elimination or modification of the “preliminary report” procedure granted by promulgation to the HRC Executive Director. 71 IAC 10-3-20(b)." In January, 2012, instead of eliminating 71 IAC 10-3-20(b), the IHRC chose to modify the "preliminary report" rule by simply changing those two words to "administrative complaint" as they appeared in the rule. Certain legislators were not amused by the IHRC's indifferent attitude to this supposed modification of this administrative rule. Take a quick read of 71 IAC 10-3-20(b) while keeping in mind the striking of "the commission's designee" and "in addition to a penalty assessed by the stewards and judges" by SB 609.
71 IAC 10-3-20 Administrative complaints
Authority: IC 4-31-3-9
Affected: IC 4-31-13
Sec. 20. (a) If the commission determines that a person regulated under the Act has violated the Act or a rule or order adopted
under the Act in a manner that constitutes a ground for disciplinary action under the Act, the commission may assess an administrative penalty against that person as provided by this section.
(b) The commission delegates to the executive director the authority to prepare and issue administrative complaints pursuant
to the Act. If, after examination of a possible violation and the facts relating to that possible violation, the executive director
determines that a violation has occurred, the executive director shall issue an administrative complaint that states the facts on which the conclusion is based, the fact that an administrative penalty is to be imposed, the amount to be assessed, and any other proposed sanction, including suspension, or revocation. Furthermore, when the judges have issued a ruling that a violation has occurred, the executive director may issue an administrative complaint identifying the underlying ruling that serves as the basis for the administrative complaint, the fact that an administrative penalty is to be imposed, the additional amount to be assessed, and any other proposed sanction including additional suspension or revocation. The amount of the penalty may not exceed five thousand dollars ($5,000) for each violation. Each day or occurrence that a violation continues may be considered a separate violation. In determining the administrative penalty, the executive director shall consider the seriousness of the violation.
(Please note that subsections(c) through (f) were removed for brevity's sake.)
(Indiana Horse Racing Commission; 71 IAC 10-3-20; emergency rule filed Feb 10, 1994, 9:20 a.m.: 17 IR 1208; emergency rule filed Jan 27, 1995, 3:30 p.m.: 18 IR 1507; errata filed Mar 23, 1995, 4:30 p.m.: 18 IR 2126; readopted filed Oct 30, 2001, 11:50 a.m.: 25 IR 899; emergency rule filed Mar 20, 2007, 1:43 p.m.: 20070404-IR-071070198ERA, eff Mar 16, 2007 [IC 4-22-2-37.1 establishes the effectiveness of an emergency rule upon filing with the Publisher. LSA Document #07-198(E) was filed with the Publisher March 20, 2007.]; readopted filed Mar 23, 2007, 11:31 a.m.: 20070404-IR-071070030RFA; emergency rule filed Jan 25, 2012, 12:20 p.m.: 20120201-IR-071120056ERA)
Effectively, the changes to SB 609 will eliminate the IHRC's authority to keep 71 IAC 10-3-20(b) in the administrative code. By design, SB 609 was supposed to make sure 71 IAC 10-3-20(b) was eliminated. Remember, per SB 609, the IHRC will no longer have the authority to delegate the ability to penalize to the Executive Director, yet 71 IAC 10-3-20(b) does delegate that ability. What we find interesting is that the first line of 71 IAC 10-3-20(b) "delegates to the executive director.......pursuant to the Act," yet beginning January 1, 2014, the "Act" will not allow for that delegation. Also, per SB 609, the IHRC will no longer have the authority to add their own penalty to a ruling by the judges and stewards, yet 71 IAC 10-3-20(b) currently allows for that to happen via an administrative complaint.
We don't see any way in which 71 IAC 10-3-20(b) should exist on January 1, 2014. Yet, the IHRC staff failed to present this administrative rule as part of those that needed modification in light the changes required by SB 609. Was the IHRC staff attempting to misguide the commissioners or was 71 IAC 10-3-20(b) simply overlooked? We'll try to find out by filing a petition directly with the commissioners to have 71 IAC 10-3-20(b) removed from the Indiana Administrative Code by citing the changes made by SB 609. Another 'strike out,' if you will. And, evidently, we'll also have to let certain legislators know how the IHRC staff has reacted to SB 609.
