WSR 10-19-141



(Financial Services Administration)

[ Filed September 22, 2010, 9:17 a.m. ]

Original Notice.

Preproposal statement of inquiry was filed as WSR 08-22-051.

Title of Rule and Other Identifying Information: The department is amending chapter 388-02 WAC, department hearing rules.

Hearing Location(s): Office Building 2, Auditorium, DSHS Headquarters, 1115 Washington, Olympia, WA 98504 (public parking at 11th and Jefferson. A map is available at or by calling (360) 664-6094), on November 9, 2010, at 10:00 a.m.

Date of Intended Adoption: Not earlier than November 10, 2010.

Submit Written Comments to: DSHS Rules Coordinator, P.O. Box 45850, Olympia, WA 98504-5850, delivery 1115 Washington Street S.E., Olympia, WA 98504, e-mail, fax (360) 664-6185, by 5 p.m. on November 9, 2010.

Assistance for Persons with Disabilities: Contact Jennisha Johnson, DSHS rules consultant by October 26, 2010, TTY (360) 664-6178 or (360) 664-6094 or by e-mail at

Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules:

A. Rules to promote timeliness.

1. Prehearing conferences: The proposed rule revision makes a prehearing conference mandatory if a prehearing conference is requested by either party and clarifies the administrative law judge (ALJ) responsibility to record the prehearing. Prehearing conferences can help expedite or settle cases.

2. Notice of hearings: The proposed rule revision requires office of administrative hearings (OAH) to mail hearing notices not less than fourteen days before the hearing in most situations and requires rescheduling if requested by a party when adequate notice is not given. The proposed rule revision also requires OAH to send copies of requests for hearing to the department unless the request was received from the department. These changes support prehearing planning and opportunities for communication and settlement.

3. Late requests for review: The proposed rule revision changes the standard for granting review when a request is late from "good reason" to "good cause" to comport with the standard used elsewhere in the rules regarding the issues of lateness or failure to act.

4. Hearing record content: The proposed rule revision sets forth the required contents for administrative hearing files. Missing items can delay board of appeals (BOA) review.

B. Rules to make other process improvements.

5. Review standards: The proposed rule revision deletes review standards from the hearing rules to comport with applicable published case law and the Administrative Procedure Act.

6. What laws apply: The proposed rule revision clarifies that the ALJ should apply the substantive rules that were in effect when the department made its original decision, notwithstanding subsequent amendments, and the procedural rules that were in effect on the date the procedure was followed.

7. The proposed rule revision clarifies when notice is required regarding assignment of ALJs and the grounds and procedures for a motion of prejudice.

8. The proposed rule revision deletes the ALJ's authority to dismiss or reverse department actions when the department does not attend a prehearing conference.

9. The proposed rule revision addresses the effect of the department's indexed final orders. The RCW permits an agency to cite a final order (such as a BOA review decision) as precedent if it is included in the agency's published index of significant decisions. The proposed rule revision informs parties of this authority.

10. Equitable estoppel: The proposed rule revision clarifies the circumstances under the law in which department statements or actions which were relied upon by the appellant may be used by the appellant to defend against a department action (such as collection of an overpayment). The proposed rule amendments are made so that the rule comports with applicable appellate case law.

11. Limited authority of ALJs: The proposed rule revision clarifies that under existing law, ALJs do not have the same equitable powers as a superior court judge.

12. The proposed rule revision clarifies when and how a hearing can be converted from one format to another (i.e. in-person versus telephonic).

13. The proposed rule revision makes corrections for grammar and other minor changes for clarification.

Reasons Supporting Proposal: See Purpose above.

Statutory Authority for Adoption: RCW 34.05.020, 34.05.220.

Statute Being Implemented: Chapter 34.05 RCW.

Rule is not necessitated by federal law, federal or state court decision.

Name of Proponent: Department of social and health services, governmental.

Name of Agency Personnel Responsible for Drafting, Implementation and Enforcement: Jim Conant, 1115 Washington Street S.E., Olympia, WA 98504, (360) 664-6081.

No small business economic impact statement has been prepared under chapter 19.85 RCW. The proposed rules adopt, amend, or repeal "a procedure, practice or requirement relating to agency hearings" and under RCW 19.85.025(3) and 34.05.310 (4)(g)(i), a small business economic impact statement is not required.

A cost-benefit analysis is not required under RCW 34.05.328. The proposed rules are "procedural rules" related to agency hearings and do not meet the definition of a "significant legislative rule" under RCW 34.05.328 (5)(c)(iii). Under RCW 34.05.328 (5)(a)(i), a cost-benefit analysis is only required for significant legislative rules. A cost-benefit analysis is not required for procedural rules.

September 20, 2010

Katherine I. Vasquez

Rules Coordinator

Reviser's note: The material contained in this filing exceeded the page-count limitations of WAC 1-21-040 for appearance in this issue of the Register. It will appear in the 10-20 issue of the Register.

Washington State Code Reviser's Office