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Regulatory Alert

CURRENT PROPOSED STATE OF ILLINOIS RULES AFFECTING SMALL BUSINESS

If any of the following proposed regulations impact your business, let us know!   Click here to submit comments on how the proposed rulemakings will impact your business or industry.   

Following are  proposed rules of possible interest to small businesses published in the Illinois Register.  During the comment period, individuals have an opportunity to express their support or opposition to the rule.  To submit comments or to learn more about the proposed rules, contact Katy Khayyat at the Department of Commerce and Economic Opportunity Business Information Center via e-mail at Katy.Khayyat@Illinois.gov  or call (800) 252-2923 or (217) 785-8020. 

To get more information on Illinois Rules and Regulations, how to file a complaint about a burdensome or excessive state rule, go to www.ienconnect.com/regflex.
 


 
 
The following proposed amendments will impact controlled substance license holders:                
 
The Department of Financial and Professional Regulation proposed amendments to the Part titled "Illinois Controlled Substances Act" (77 Ill Am Code 3100; 38 Ill Reg 5705) to reflect changes in medical practice, security, and prescription procedures since the Part was last amended in 2004.  Advanced practice nurses and physician assistants who have been granted clinical privileges at a hospital, hospital affiliate or ambulatory surgical treatment center are added to the list of persons who may be licensed to prescribe controlled substances. Exemption conditions for APNs, PAs and temporary license holders are updated to include verification by the employer institution that the prescriber is licensed to administer or prescribe drugs and that all prescriptions issued include the institution's registration number, the individual's specific internal code, and service identification number. The rulemaking clarifies that APNs and PAs must meet the education requirements established in the Illinois Controlled Substances Act. A person who writes prescriptions without proper authority may be fined up to $50 for each unauthorized prescription, and may be subject to other DFPR disciplinary actions. Licensees who wish to modify their licenses must follow the same procedures as applicants for new licenses. The criteria for terminating a license are updated to include change of status of the primary professional license. All changes in legal existence, business, professional practice and name or address must be reported to DFPR within 10 days after the change. Licenses for APNs and PAs who were delegated controlled substance prescriptive authority will terminate when the authority does. Security requirements are updated to require licensees to make available extra security evidence to the DFPR upon request. Personal bags are not allowed in any area where controlled substances are handled or stored. Physical controls in a pharmacy must include an alarm system and a key maintained by a registered pharmacist or certified pharmacy technician. Criteria for evaluating security systems are updated to include adequacy of supervision, having access to manufacturing and storage areas, and the applicability of federal, State and local security requirements.  Record and inventorying requirements are updated to reflect the use of electronic prescriptions and requiring licensees to conduct annual inventories of actual count for Schedule II controlled substances (those with high potential for abuse or addiction) and approximate count for Schedule III, IV and V controlled substances. Copies of a federal DEA Report of Theft or Loss of Controlled Substances must be filed with DPFR. Also, all licensees must log every prescription for at least 5 years and keep the original transcript or copy of each verbal prescription available for inspection. Criteria for alternative reporting are established. The rulemaking clarifies that practitioners cannot self-prescribe or prescribe to immediate family members unless there is a bona fide practitioner-patient relationship. Provisions for electronic and printed prescriptions (in addition to written prescriptions) are added. Pharmacists may not change the date, name of patient name of prescriber or the name of the drug on a schedule II prescription.  Schedule III, IV or V controlled substance prescription refills may only be done at the request of the patient to contact the prescriber. The rulemaking clarifies that partial fillings of prescriptions are not considered refills and clarifies partial filling procedures for patients in long term care facilities or who are terminally ill. DFPR is allowed to grant variances from the rules in individual cases. Other updates reflect the federal regulations and remove obsolete and outdated Sections. Current controlled substance license holders will be affected by this rulemaking. 
 
Bottom Line:  This Part has not been substantially revised in more than 25 years, and there have been numerous amendments to the Controlled Substances Act that have never been addressed in that time.  PA 97-334 contains the most recent statutory changes to the Act which these amendments implements.  The proposed rule’s intent is conformance of this Part to the Act and to federal law.  Included in these revisions is the repeal of numerous provisions relating to administrative and disciplinary functions that are provided for by other Department Rules or policies and are no longer pertinent.   It adds definitions and the enhancement of Department regulatory oversight of the purchase, sale and storage of controlled substances.  It also includes a prohibition on practitioner self-prescribing of controlled substances, as well as a general cleanup of the part.  For questions or comments, contact Craig Cellini at Craig.Cellini@Illinois.gov, or call (217) 785-0813.  Click here to submit comments.
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The following proposed amendments will impact retailers who have entered into agreements with local governments to source the point of sale to their jurisdictions: 
 
The Department of Revenue proposed amendments to 10 Parts: "Home Rule County Retailers' Occupation Tax" (86 Ill Adm Code 220, 38 Ill Reg 6549); "Home Rule Municipal Retailers' Occupation Tax" (86 Ill Adm Code 270; 38 Ill Reg 6562); "Regional Transportation Authority Retailers' Occupation Tax" (86 Ill Adm Code 320; 38 Ill Reg 6575); "Metro East Mass Transit District Retailers' Occupation Tax" (86 Ill Adm Code 370; 38 Ill Reg 6588); "Metro-East Park and Recreation District Retailers' Occupation Tax" (86 Ill Adm Code 395; 38 Ill Reg 6601); "County Water Commission Retailers' Occupation Tax" (86 Ill Adm Code 630; 38 Ill Reg 6614); "Special County Retailers' Occupation Tax for Public Safety" (86 Ill Adm Code 670; 38 Ill Reg 6627); "Salem Civic Center Retailers' Occupation Tax"  (86 Ill Adm Code 690; 38 Ill Reg 6640); "Non-Home Rule Municipal Retailers' Occupation Tax" (86 Ill Adm Code 693; 38 Ill Reg 6653); and "County Motor Fuel Tax" (86 Ill Adm Code 695; 38 Ill Reg 6666). The amendments implement a decision of the Illinois Supreme Court in Hartney Fuel Oil Co. v. Hamer, invalidating current regulations that assign sales tax jurisdiction to the location where an individual sale is made. Instead, the new standard is where the general business of selling is located. The amendments are similar to emergency amendments that were effective 1/22/14 and to 10 previously proposed rulemakings on these Parts that have been withdrawn (see below), except that references to long term or blanket contracts are being removed. Retailers who have entered into agreements with local governments to source the point of sale to their jurisdictions may be adversely affected.
 
Bottom Line:  These proposed regulations provide guidance for retailers to determine what local taxes they incur based on the location where they are "engaged in the business of selling tangible personal property."   The Department's current regulation governing local jurisdictional issues was invalidated by the Illinois Supreme Court in Hartney Fuel Oil Co. v. Hamer, 2013 IL 115130. The proposed rule contains three basic parts. In subsection (b), the rulemaking sets out three core principles underlying determinations for local occupation tax sourcing. As the court in Hartney emphasized, a fact-intensive inquiry into the composite of activities that comprise a retailer's business must be analyzed. Subsection (c) applies these principles to commonly occurring types of retail transactions, thereby providing guidance to the vast majority of retailers operating in Illinois. Subsection (d) then applies these principles to retailers that engage in selling activities in multiple jurisdictions. This subsection establishes several primary factors to be used in determining local occupation tax sourcing, as well as several secondary factors to be used when the primary factors, alone, are not dispositive. It also sets out guidance to be used when a determination is very close, due to the fact that a retailer's activities are spread throughout so many jurisdictions. In this case, the rulemaking provides that the Department will evaluate all the factors in keeping with the principle articulated in Hartney that a retailer incurs tax in the jurisdiction where it "enjoyed the greater part of governmental protection [and] benefitted by being conducted under that protection." The regulation reiterates Hartney's emphasis on the Department's ability to look through the form of a putatively multijurisdictional transaction to its substance in determining where enough of the business of selling takes place to subject it to local occupation taxes. Please note that this rulemaking differs from the emergency rule currently in effect in one important way; it rulemaking does not contain the subsection, currently found in the emergency rules, entitled, "Long Term or Blanket Contracts." In other respects, the rules are substantively identical.   For questions or comments, contact Paul Berks, Deputy General Counsel, Illinois Department of Revenue at (312) 814-4680, or email Paul.Berks@Illinois.gov.  Click here to submit comments.
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The Department of Human Services proposed amendments which will impact child care providers:
 
The Department of Human Services proposed an amendment to the Part titled “Child Care” (89 Ill. Adm. Code 50; 38 Ill. Reg. 7018) implementing PA 98-61, which makes juvenile records involving offenders under age 18 (formerly, under age 17) confidential.  The rulemaking requires finger-print-based criminal history record checks for persons 18 or older (currently 17 or older) who reside in a child care home exempt from licensing even if they are not usually present in the home while children are being cared for.  (Persons age 13 and older who have been tried and convicted as adults for certain crimes remain subject to the background check.) 
 
Bottom Line:  PA 98-61 amends the Juvenile Court Act of 1987, changing the definition of delinquent minor to include a person who was under 18 (rather than 17) years of age when he or she committed an offense classified as a felony.  This act also changes the age concerning confidentiality of juvenile records.  As a result, this proposed rulemaking establishes that provider fingerprint-based criminal history record checks will only be conducted for persons 18 years of or older.  For questions or to submit comments, contact Tracie Drew at (217) 785-9772 or email Tracie.Drew@Illinois.gov. Click here to submit comments. 
 


For more information on anything in this issue of Regulatory and Information Alert, contact Katy Khayyat at Katy.Khayyat@Illinois.gov or call (217) 785-8020 or (800) 252-2923.  To be removed from this mailing list, please contact Katy Khayyat at Katy.Khayyat@Illinois.gov or by calling (217) 785-8020 or (800) 252-2923.