Neither Iowa nor Illinois have producer security programs for milk or vegetables. However, both states maintain indemnity funds to protect grain producers. Fund assessments are based solely on grain volume. In Wisconsin, by contrast, fund assessments are based on grain volume and financial condition. Iowa and Illinois finance their programs through industry fees and general tax revenues.

Michigan has the following producer security programs:

Under the agricultural producer security law:

Prior to 2003, DATCP administrative costs were paid by a combination of general tax revenue (“GPR") and contractor license fees. However, as part of the GPR reductions in Act 33, the 2003-2005 Biennial Budget, 2.9 FTE positions and support costs were converted from GPR to the Agricultural Producer Security SEG fund. Partly as a result of that change, current license fee funding is no longer adequate to cover administrative costs. There has been a gradual growth in administrative costs, due to factors (such as statewide union contracts for accountants and auditors) that are outside DATCP control.

Funding shortfalls are especially severe in the grain dealer and grain warehouse keeper programs. Administrative costs now annually exceed license fee revenues by over $200,000 in each of those programs, and each program has a negative cash balance of more than $336,000. In the vegetable contractor program, administrative costs now annually exceed license fee revenues by over $20,000.

Deficits in the grain and vegetable administration sub accounts affect the total cash balance in Agriculture Producer Security Fund. This unfairly affects milk contractors since the total fund balance is incorporated into the formula that calculates their required security amounts and also affects the total funds available to pay a default.

This rule increases annual license fees for grain dealers, grain warehouse keepers and vegetable contractors, to remedy current inequities and provide minimally adequate funding for program administration (the fee increases for vegetable contractors will be largely offset by fee credits built into the producer security law). This rule also adjusts fund assessments, especially for grain warehouse keepers (for whom an adjustment is required by law).

Notwithstanding this rule, total revenue derived from contractor payments under the producer security program (license fees plus fund assessments) will actually decline over the next few years, because of fee credits and declining formula rates that are built into the producer security law itself. This rule will slow, but not reverse, that overall decline.

License Fee Revenues. The following table shows actual license fee revenues for FY 2005-06, compared to projected license fee revenue in FY 2009-10 (with and without this rule):

Total License Fee Revenues (Net of Contractor Credits)
	FY 2005-06	FY 2009-10* Without this rule	FY 2009-10* With this rule
Grain Dealers	$160,000	$155,000	$405,000
Grain Warehouse Keepers	$159,000	$149,000	$393,000
Milk Contractors	$363,000	$159,000	$159,000
Vegetable Contractors	$16,000	$5,000	$8,000
TOTAL	$698,000	$468,000	$965,000

* Projection assumes constant procurement volumes, commodity price levels and contractor financial strength.

Projected milk and vegetable contractor license fee revenues for FY 2009-10 are affected, to a very considerable degree, by license fee credits built into the producer security law itself. When the producer security fund balance attributable to an industry sector (such as milk or vegetables) reaches a specified statutory “trigger" amount, a portion of the balance is returned to contributing contractors in that sector (as a credit on their license fees).

Contributing vegetable contractors are already enjoying credits that significantly reduce their license fees, and milk contractors began receiving credits in May, 2007. Grain dealers and grain warehouse keepers do not yet qualify for these credits, because their fund contributions have not yet attained the required level (nor are they likely to do so prior to FY 2009-10).

Increased annual license fee revenues will be adequate to cover annual DATCP administrative costs. To the extent that annual license fee revenues exceed annual administrative costs, the additional revenues will offset the deficit in the administrative sub account.

Producer Security Fund; Assessment Revenues

The agricultural producer security fund currently has a balance of approximately $7,493,000. No more than 60% of the fund balance can be paid out in any individual contractor default. The current fund balance is adequate to cover defaults by most, but not all, individual contractors. Continued fund growth will improve protection for producers, and minimize the need for supplementary security from contractors.

Contributing contractors pay fund assessments to finance the agricultural producer security fund. Annual assessment revenues will decline over the next few years (with or without this rule), because of fee credits and declining formula rates built into the producer security law. Annual assessment revenues will decline across all business sectors. This rule will slow (but not reverse) the projected decline of annual assessment revenues.

The following table shows actual fund assessment revenues for FY 2005-06, and projected assessment revenues for FY 2009-10 (with and without this rule):

Total Fund Assessment Revenues
	FY 2005-06	FY 2009-10* Without this rule	FY 2009-10* With this rule
Grain Dealers	$512,000	$240,000	$269,000
Grain Warehouse Keepers	$51,000	$20,000	$35,000
Milk Contractors	$909,000	$859,000	$868,000
Vegetable Contractors	$122,000	$37,000	$40,000
TOTAL	$1,594,000	$1,156,000	$1,212,000

* Projection assumes constant procurement volumes, commodity price levels and contractor financial strength.

Cash in the assessment sub account currently covers the negative cash balances in the grain and vegetable administration sub accounts. That is slowing the rate of growth in the assessment sub account, and reducing the fund coverage for all producers (grain, milk, and vegetable). By correcting current grain and vegetable license fee revenue shortfalls, this rule will eliminate the current drain on the producer security fund. That, combined with the adjustment of fund assessment rates, will cause the fund balance to grow at a faster rate. Faster growth will increase protection for producers, and reduce supplementary security demands on contractors.

Without this rule, DATCP projects that the fund balance will grow to $8,332,000 at the end of FY 2009-10. With this rule, DATCP projects that the fund balance will grow to $9,425,000 by the end of FY 2009-10. Under this rule, the fund balance amount attributable to grain warehouse keeper assessments will build over several years toward the required statutory minimum (it currently falls short of the required minimum).

NOTICE IS HEREBY GIVEN That pursuant to ss. 115.76 (5) (b) and 227.11 (2) (a), Stats., and interpreting ss. 115.76 (5) (a) 10. and (b), Stats., the Department of Public Instruction will hold public hearings as follows to consider the amending of s. PI 11.36, relating to the identification of children with specific learning disabilities and significant developmental delays.

The hearing sites are fully accessible to people with disabilities. If you require reasonable accommodation to access any meeting, please call Kathy Laffin, Consultant, Specific Learning Disabilities, at (608) 266-2841 or leave a message with the Teletypewriter (TTY) at (608) 267-2427 at least 10 days prior to the hearing date. Reasonable accommodation includes materials prepared in an alternative format, as provided under the Americans with Disabilities Act.

Sections 115.76 (5) (a) 10. and (b), Stats.

Sections 115.76 (5) (b) and 227.11 (2) (a), Stats.

Subchapter V of Chapter 115, Stats. Chapter PI 11, Wis. Admin. Code.

Section 115.762 (3) (a), Stats., requires the department to ensure that all children with disabilities are identified, located and evaluated.

Section 227.11 (2) (a), Stats., gives an agency rule-making authority to interpret the provisions of any statute enforced or administered by it if the agency considers it necessary to effectuate the purpose of the statute.

The proposed rules directly reflect the language under 34 CFR 300.307 to 300.311 as authorized under 20 U.S.C. 1221e-3, 1401 (30), and 1414 (b) (6).

Illinois, Iowa, Michigan, and Minnesota (as well as the remaining states) will be revising their law to comply with the federal language.

In 2004, the Individuals with Disabilities Education Act (IDEA) modified the evaluation procedures for the identification of children with specific learning disabilities (SLD) under 20 U.S.C. 1414 (b) (6). As specified in IDEA, the evaluation procedures relating to the identification of specific learning disabilities provide that: 1) States may not require the use of significant discrepancy as part of a determination of SLD, 2) States must permit the use of a process based on a child's responses to scientifically-based intervention as part of its determination of a SLD, and 3) States may permit the use of other alternative research-based procedures to determine whether a child has a SLD. IDEA also added reading fluency skills as an area of identification for SLD. Because the department's current rule under s. PI 11.36 (6), relating to specific learning disabilities is not consistent with the federal requirements, the rule will be modified to align with the U.S. Code. The proposed rules will allow a four-year period during which a school district "is permitted but not required to" continue to use the significant discrepancy formula in identifying children with SLD.

In addition, 20 U.S.C. 1401 (3), permits the identification of children with significant developmental delay (SDD) through the age of nine. The department's current rule under s. PI 11.36 (11), relating to SDD permits identification only through the age of six. The proposed rule will extend the SDD age limit through the age of nine as authorized under federal law.

The administrative rule and fiscal note are available on the internet at http://dpi.wi.gov/pb/rulespg.html. A copy of the proposed rule and the fiscal estimate also may be obtained by sending an e-mail request to lori.slauson@dpi.state.wi.us or by writing to:

Written comments on the proposed rules received by Ms. Slauson at the above mail or email address no later than October 10, 2007, will be given the same consideration as testimony presented at the hearing.

The proposed rules are not anticipated to have a fiscal effect on small businesses as defined under s. 227.114 (1) (a), Stats.

The proposed rules modify eligibility criteria used to identify children with specific learning disabilities (SLD) to be consistent with federal requirements. The federal requirements focus more on early intervention services and do not want the use of “significant discrepancy" in determining whether a child has a SLD. This rule modification should not result in altering the size of the population of children identified as having a disability. Wisconsin must comply with federal requirements in order to remain eligible to receive more than $200 million in federal IDEA funds.

The rules also permit the identification of a child with significant developmental delays (SDD) through the age of nine, rather than the age of six. Allowing a child with SDD to be identified through the age of nine will provide a longer window of time to assess whether the child has a specific disability, and thus, should not result in altering the size of the population of children identified as having a disability.

These rules are not expected to have a local or state fiscal effect.