BEFORE THE COMMISSIONER OF SECURITIES AND INSURANCE

OFFICE OF THE MONTANA STATE AUDITOR

 

In the matter of the amendment of ARM 6.10.303 pertaining to Exemptions

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NOTICE OF PROPOSED AMENDMENT   NO PUBLIC HEARING CONTEMPLATED

TO: All Concerned Persons

 

1.  The Commissioner of Securities and Insurance, Office of the Montana State Auditor (CSI) proposes to amend the above-stated rule.

 

2.  CSI will make reasonable accommodations for persons with disabilities who wish to participate in this rulemaking process or need an alternative accessible format of this notice.  If you require an accommodation, contact CSI no later than 5:00 p.m. on August 16, 2022, to advise us of the nature of the accommodation that you need. Please contact Sam Loveridge, Communications Director, 840 Helena Avenue, Helena, Montana, 59601; telephone (406) 444-2040 or 1-800-332-6148; fax (406) 444-3497; TDD (406) 444-3246; or e-mail csi@mt.gov.

 

3. The rule proposed to be amended provides as follows, new matter underlined, deleted matter interlined:

 

6.10.303  SECOND TIER LIMITED OFFERING EXEMPTION (1) through (2)(a) remain the same.

(b) a filing fee of $50;

(c) and (d) remain the same but are renumbered (b) and (c).

(3) remains the same.

 

AUTH: 30-10-107, MCA

IMP: 30-10-105, MCA

 

4. REASON: As part of the biannual review of CSI's rules as required by 2-4-314, MCA, Montana State Auditor Troy Downing (commissioner) identified ARM 6.10.303 for revision to eliminate reference to a reduced filing fee ($50) that conflicts with the applicable statutory requirements of 30-10-209(4), MCA, specifying a $100 fee for exempt transaction requests at issue in the above rule. The fee for exempt transaction requests was increased from $50 to $100 in 30-10-209(4), MCA, by the Montana Legislature in 2019 (Sec. 1, Ch. 396, L. 2019), which change was effective on passage and approval (May 9, 2019). This rule, however, had not been updated accordingly by the prior commissioner.

 

5.  The financial impact of this proposed correction going forward should be $0.00 as the fee required by statute has been $100 since at least May 2019. However, the proposed correction to remove the conflicting rule provision will technically "increase" the (incorrect) filing fee by $50 per filing. Thus, in keeping with the requirements of 2-4-302(1)(c), MCA, the estimated number of persons affected by this change is 10 per year, making the estimated cumulative amount of this "increase" for all persons in one year, $500. 

 

6.  Concerned persons may submit their data, views, or arguments concerning the proposed actions in writing to: Sam Loveridge, CSI Communications Director, 840 Helena Avenue, Helena, Montana, 59601; telephone (406) 444-2040 or 1-800-332-6148; fax (406) 444-3497; TDD (406) 444-3246; or e-mail CSI@mt.gov, and must be received no later than 5:00 p.m., September 2, 2022.

 

7. If persons who are directly affected by the proposed actions wish to express their data, views, or arguments orally or in writing at a public hearing, they must make written request for a hearing and submit this request along with any written comments to Sam Loveridge at the above address no later than 5:00 p.m., September 2, 2022.

 

8. If the agency receives requests for a public hearing on the proposed actions from either 10 percent or 25, whichever is less, of the persons directly affected by the proposed actions; from the appropriate administrative rule review committee of the Legislature; from a governmental subdivision or agency; or from an association having not less than 25 members who will be directly affected, a hearing will be held at a later date. Notice of the hearing will be published in the Montana Administrative Register.  Ten percent of those directly affected has been determined to be far in excess of 25 persons based on the number of second tier limited offering exemptions filed with the commissioner per year. 

 

9.  CSI maintains a list of interested persons who wish to receive notices of rulemaking actions proposed by this agency. Persons who wish to have their name added to the list must make a written request that includes the name, e-mail, and mailing address of the person to receive notices and specifies for which program the person wishes to receive notices. Notices will be sent by e-mail unless a mailing preference is noted in the request. Such written request may be mailed or delivered to the contact person in paragraph 6 or may be made by completing a request form at any rules hearing held by CSI.

 

10.  An electronic copy of this proposal notice is available through the Secretary of State's website at http://sosmt.gov/ARM/Register.

 

11.  The bill sponsor contact requirements of 2-4-302, MCA, do not apply.

 

12.  With regard to the requirements of 2-4-111, MCA, CSI has determined that the amendment of the above-referenced rule will not significantly and directly impact small businesses.

 

 

/s/ Kirsten Madsen                                       /s/ Ole Olson                        

Kirsten Madsen                                            Ole Olson

Rule Reviewer                                              Chief Legal Counsel

Commissioner of Securities and Insurance, Office of the Montana State Auditor

 

Certified to the Secretary of State July 26, 2022.