in-20250820-IR-355240622RAA: Regulatory Analysis — 355 IAC (LSA #240622)

TITLE 355 STATE CHEMIST OF THE STATE OF INDIANA Readoption Review LSA Document #24-622

I. Statement Whether the Subject Matter Covered by the Rule Remains Carried out by the Agency

Yes, the subject matter covered by 355 IAC 4 is still carried out by the Office of Indiana State Chemist (OISC).

II. Rationale for the Continued Need for the Rule 

To ensure compliance with U.S. Environmental Protection Agency’s (EPA) federal regulations in the 40 CFR and FIFRA, the annual cooperative agreement grants, and to uphold state pesticide use primacy, it is essential to maintain the regulatory framework governing pesticide application and enforcement. Such rules, as established in 355 IAC 4, are necessary to align state regulations with federal requirements, maintain eligibility for EPA funding, and ensure responsible management of pesticide use. By implementing 355 IAC 4, the state can enhance oversight, improve consistency in enforcement, minimize regulatory burden, and support sustainable agricultural and land management practices while safeguarding human health and natural resources. The regulatory framework is supported by Indiana Code (IC) Title 15, Article 16, which governs pesticide use and distribution, and 355 IAC 4, which outlines state-specific requirements for pesticide applicators. Regulations under 355 IAC 4 reinforce the state's ability to maintain pesticide use primacy, secure continued EPA funding, and support Indiana’s federally required Certification and Training Plan (C&T Plan), while protecting Indiana’s environment and communities in the least restrictive manner possible to our regulated community. Under IC 15-16-5-63(b), in accordance with 7 U.S.C. 136w-l, OISC shall have primary enforcement responsibility for pesticide use as the EPA has determined that the state of Indiana has adopted adequate pesticide use laws and rules, and EPA has approved the state’s C&T Plan. (For more information about the required C&T Plan, see Additional Background information provided below in this section.) 355 IAC 4 was written using straightforward language, with the intent to clearly define key terms and processes without excessive legal jargon. Sentences are structured logically and consistently, and any technical terms necessary for regulatory accuracy are defined in a way that is accessible to an informed public audience. This ensures that stakeholders, including regulated parties, enforcement agencies, and the public, can readily understand the rule's requirements. 355 IAC 4-0.5 Continued Need Summary 355 IAC 4-0.5 contains definitions related to 355 IAC, IC 15-16-4, and IC 15-16-5. This rule was last revised in 2023 and 2024. At that time unnecessary definitions were voided or repealed; some rules were moved into IC 15-16-5. The definitions add no additional expense to the regulated entities, provide OISC with the ability to achieve regulated needs in the least restrictive manner, and provide ease of comprehension to ensure that OISC and the regulated community have a clear understanding of the terms used within IC 15-16 and 355 IAC 4. 355 IAC 4-3 Continued Need Summary According to IC 15-16-5-58, the state chemist may not issue a pesticide business license or a pest inspector license until the applicant for the license has furnished a surety bond, a certificate of liability insurance in force, or a certificate of financial responsibility to protect persons who may suffer legal damages as a result of the pesticide operations or pest inspections of the applicant. IC 15-16-5-5 defines the “Certificate of financial responsibility” and includes that the notarized statement attests to the adequate financial resources equal to that required by rule under 15-16-5-58. In addition, IC 15-16-5-72(b) states that OISC is authorized to have restrictions or requirements more stringent than federal law in relation to requirements around minimum liability insurance coverage. 355 IAC 4-3 provides clarity to the regulated community as to what the minimum coverage amounts are and acceptable forms of insurance. (See section VI for current coverage limits.) 355 IAC 4-7 Continued Need Summary There is a continued need for this rule because it aligns with federal regulations, allowing Indiana to maintain primacy over pesticide use. The rule was established with Industry support through extensive work with an industry workgroup and a Governor-appointed board, which included representatives from the largest pesticide applicator industry groups, that provided input throughout the process. The rule is part of the federally required certification and training rule (40 CFR 171); Indiana’s C&T Plan was approved in January, 2023. Indiana’s C&T Plan was found to meet the minimum federal standards. In 2024, OISC collaborated with Indiana legislators to effectively and efficiently reduce regulatory burden and economic impact on Indiana businesses. Additional Background for the Continued Need of Rule 355 IAC 4-7 IC 15-16-5-45 and IC 15-16-5-54 provide for the State Chemist establishing requirements and standards to assure that pesticide applicators maintain a level of competence and ability to use pesticides safely and properly. Prior to the initial implementation of this rule (pre-2008), these standards and requirements were in policies and procedures. By placing the requirements in rule, we have seen assured consistency of requirements for pesticide applicators and an improved government process. The initial rulemaking process created a workgroup of regulated pesticide applicators that were consulted in the development of the standards and requirements established in this rule. The process in the creation of this rule was published in the Journal of Pesticide Safety Education in 2009. The article, “Professional Continuing Education for Commercial Pesticide Applicators: A Case Study in Standard Setting” (Journal of Pesticide Safety Education, Volume 11, 2009) has been included with this submission as a supporting PDF and is available to the public here: https://www.aapse.org/journal/. In 2017 United States Environmental Protection Agency (EPA) published the revised certification and training rule (40 CFR 171), requiring all states to provide the agency with an updated and approved C&T Plan. The Indiana C&T Plan was found to meet the minimum federal standards and was approved on 1-31-2023. The submission requirements of the state C&T Plan included initial certification of pesticide applicators, categories of certification, and recertification applicators. The federal requirements mandate that a certification cycle cannot exceed five years.  Indiana’s certification cycle is at the 5-year federal maximum. 40 CFR 171.107 also describes the mechanism by which applicators can be recertified.  Both reexamination and continuing education are suitable for recertification.  Indiana provides flexibility to applicators by allowing both options. The hours of continuing education required to recertify were included in 355 IAC 4 in 2009, after consulting extensively with industry. Recertification standards meet the minimum standards described in 40 CFR 171.107 and have been approved by EPA. Practically, programs and hours are individually approved to ensure that applicators can receive recertification credit in as many categories of licensure as possible. Areas of education that are applicable for recertification are identified by rule, for the convenience of program sponsors. 40 CFR 171 requires that changes to the state C&T Plan be pre-approved by EPA.  Since Indiana currently meets the federal minimum standards, it is unlikely that Indiana could gain federal approval for changes below the minimum standard. 2024 legislation further reduced the burden to become a Registered Technician (RT). Applicators can become RT without examination or in person training.  Applicators are allowed to watch a video and immediately begin commercial applications of general use pesticides. OISC met with legislators on multiple occasions to assist in drafting language that would meet the goal of reducing regulatory burden as well maintaining primacy for inspection and enforcement activities, according to our cooperative agreement with EPA. Alternative Methods – 355 IAC 4-0.5 There are no alternative methods for this portion of the rule because this section is only definitions. By creating definitions, the rule provides stability and consistency for OISC and the regulated communities. Alternative Methods – 355 IAC 4-3 There is no true alternative to financial responsibility coverage as a condition for the State Chemist issuing a pesticide business license, since it is currently mandated in IC 15-16-5-58. Options for a business to demonstrate financial responsibility by a mechanism other than liability insurance, such as a surety bond or a certificate of financial responsibility from a financial institution, are also available options. While these two options have existed for over forty years, not one business has utilized them to apply for a license. Alternative Methods – 355 IAC 4-7 The only reliable alternative approach that has ever been suggested or implemented at any level has been a mandatory written re-examination by applicators. The concept of mandatory re-examination has been opposed by all applicator groups for many years. Applicators have grown accustomed to and prefer the flexibility of approved continued education as a means to maintain competency to use pesticides. Maintaining the ability to choose re-examination or attending continuing education courses meets industry needs.

III. Analysis of fees, fines, and civil penalties under IC 4-22-2-19.6

355 IAC 4 does not include any fees, fines or civil penalties within the rule.

IV. Cost-Benefit, Economic Impact, Fiscal Impact, or Regulatory Burden Statements

The estimated compliance costs or new administrative expenses for regulated entities remain unchanged with the readoption of this rule. Specific to 355 IAC 4-0.5 355 IAC 4-0.5 contains definitions that align with the full 355 IAC 4 article, IC 15-16-4, and IC 15-16-5. There is no economic or fiscal impact imparted by this rule. The definitions provide relief from regulatory burden by establishing a clear understanding of the terms. There is no regulatory burden or administrative expense imposed by this rule. Specific to 355 IAC 4-3 In 2012, OISC established a workgroup from Industry representatives to review the requirements of this rule. At the time, the Industry workgroup assessed that a minimum general liability coverage level should be $1,000,000. It was also confirmed that many insurance providers no longer offer coverage levels as low as $300,000.  In review of State Chemist files, over 85% of businesses had aggregate general liability insurance coverage levels of $500,000; $1,000,000; or $2,000,000 with per occurrence levels of at least $300,000. Currently in 355 IAC 4-3, the minimum general liability combined single limit of liability is $300,000 which is consistent with the standard identified upon review in 2012.  There has been no indication from the public or pesticide businesses that these amounts are too high or too low to provide adequate coverage. The estimated compliance costs for regulated entities and the administrative costs to OISC remain unchanged. The type of insurance coverage required was simplified to straight-forward general liability insurance in 2015. The administrative burden for both regulated entities and OISC was reduced at that time. 355 IAC 4-3 provides clarity to the regulated community as to what the minimum coverage amounts are and the acceptable forms of insurance. The State Chemist cannot issue a pesticide business license if the business does not have adequate coverage (15-16-5-58). 355 IAC 4-3 provides clarity on the minimum requirements and therefore reduces administrative expenses. Per the analysis and workgroup formed in 2012, according to current market pressures and good business practices, an overwhelming majority of license holders already had insurance coverage that met or exceeded the proposed minimum level. The regulatory burden was minimal at the time and now is a well-established standard. Specific to 355 IAC 4-7 In 2008, it was identified that the then proposed rule would not impose additional requirements or costs on pesticide businesses or applicators. Pesticide applicators were already required to demonstrate continued competency. The proposed rule was simply the establishment by rule of the requirements and procedures for renewal of commercial applicator certification, private applicator certification, and technician registration to use pesticides that have been administered by agency policy for over twenty years. No additional requirements were created, no revenues or expenditures were affected by the rule. The proposed rule created a mechanism to submit agency policies and procedures to the public review and public input process. The rule created a clear and consistent set of requirements so that applicators and industry would be able to plan for the future. This rule and the implementation of this rule is part of our federally approved state C&T Plan. The implementation of 355 IAC 4-7 did not impose additional regulatory burdens or administrative expenses to pesticide businesses or applicators. General to 355 IAC 4 In 2024, with work from Indiana legislators and OISC, regulatory burden was reduced.  Law changes allow for an individual to become a registered technician (apply general use pesticides, for hire), without taking an exam.  New hires can watch a video, then immediately begin work (IC 15-16-5-56). Pesticide application record-keeping was reduced to the federal minimum of restricted use pesticides only. Notification elements to OISC for termite pretreats were also removed (355-4-5-2(6)). 2024 legislation also allows for the direct supervision of a noncertified applicator, to use restricted use pesticides. Certified supervisors can follow the federal rules for supervision (40 CFR 171.201). Previously, supervision was not allowed for the use of restricted use pesticides (IC 15-16-5-44). 2024 legislation removed bulk pesticide containment requirements from rule and moved the requirements into law, adopting the federal standards (40 CFR 165).  Farmers are now largely exempt from the containment requirements. Additionally, containment requirements extend to only those containers designed to hold 500 gallons or more. Previously, any container designed to hold more than 55 gallons of pesticides was required to be in containment.

V. Alternative Methods of Achieving the Purpose of the Rule

Alternative Methods – 355 IAC 4-0.5 There are no alternative methods for this portion of the rule because this section is only definitions. By creating definitions, the rule provides stability and consistency for OISC and the regulated communities. Alternative Methods – 355 IAC 4-3 There is no true alternative to financial responsibility coverage as a condition for the State Chemist issuing a pesticide business license, since it is currently mandated in IC 15-16-5-58. Options for a business to demonstrate financial responsibility by a mechanism other than liability insurance, such as a surety bond or a certificate of financial responsibility from a financial institution, are also available options. While these two options have existed for over forty years, not one business has utilized them to apply for a license. Alternative Methods – 355 IAC 4-7 The only reliable alternative approach that has ever been suggested or implemented at any level has been a mandatory written re-examination by applicators. The concept of mandatory re-examination has been opposed by all applicator groups for many years. Applicators have grown accustomed to and prefer the flexibility of approved continued education as a means to maintain competency to use pesticides. Maintaining the ability to choose re-examination or attending continuing education courses meets industry needs.

VI. Complaints and Comments

There was one negative comment to the previous rule package seven years ago. That package introduced the concept of becoming an RT by in-person training, as opposed to taking a closed book examination. The comment from the Indiana Pest Management Association did not support applicators becoming an RT via only training (without testing requirements). The association was also not in favor of eliminating the requirements for businesses to maintain records of general use pesticide applications.

VII. Difficulties Encountered

There have not been any difficulties encountered by the agency administering the rule nor with the regulated community to comply with the rule. OISC collaborates extensively with the regulated community and our office staff to ensure that any questions are addressed. OISC submitted revisions to our rules in 2022 to facilitate the needs around the federal requirements. In addition to our proposed rule revisions, legislative changes to the rule and law occurred in 2023 and 2024. These continuous changes to the rules, or code, have made it difficult for the regulated community to plan for future needs and have increased questions to our office. We have responded to the rule changes by providing updates at meetings throughout the state (PARPs and CCHs). We have also created resources that are posted on our website that can be printed to hand out and discussed changes at Indiana Pesticide Review Board meetings that are attended by the regulated community.

VIII. Changes in Technology, Economic Conditions, or Other Factors

Through technological advancements, OISC has been able to provide remote proctoring of exams. An examinee can take a secure exam at any location, worldwide. This is in addition to our more than 20 brick and mortar exam sites, throughout the state. By working with our regulated industry and legislators, the process to start working as a Registered Technician to apply General Use Pesticides commercially has been streamlined. An individual can now complete one of six different training options and send an email to the Pesticide Licensing Team (pestlicense@groups.purdue.edu) to allow for an immediate path to work.

IX. Other State or Federal Requirements  

Through 355 IAC 4-7-2, OISC provides two different opportunities for Commercial Applicators to become certified and renew their certification. OISC allows for the maximum number of years for recertification that is allowed federally (5 years); in comparison, the surrounding states all require the completion of recertification credits within a 3-year timeframe. Idaho and South Dakota require the recertification to be completed within 2 years. All states require a certified applicator to pass the core exam for their initial certification. Illinois is the only surrounding state that only allows for retesting of this exam to maintain the required certification. OISC allows either retesting or accumulating the minimum number of continuing education hours (CCHs). By allowing a variety of opportunities to recertify, OISC is providing ease of recertification and what the regulated community requested. Industry wanted this option. They can pick reexamination at the cost of $55 or they can complete the required CCHs over 5 years. In order to meet the needs of Industry, OISC has allowed for the reexamination of applicators or the accumulation of CCHs. Industry remains a proponent of continuing education as it increases the depth and breadth of their knowledge, even though reexamination is a less expensive option. In comparison to the surrounding states, OISC also has the fewest categories for applicators. This reduces the regulatory burden on our regulated community and provides a streamlined ease of compliance. For liability insurance requirements (355 IAC 4-3), in comparison with other states, Michigan and Ohio both require additional liability coverage based on the different categories. Kentucky requires the highest amount of liability coverage. Indiana is consistent with Illinois and Kentucky where we do not require additional liability coverage based on category. Initial Certification Requirements  State  Initial Exam Certification Exam Additional Training Requirements  Total Number of Categories Indiana Core Exam Category Specific Exam Category 7b-Termite Control 2-day Class. Wood Destroying Inspector (WDI) 1-Day Class 14 Michigan Core Exam Category Specific Exam No Additional Training Requirements 25 Illinois Core Exam Category Specific Exam 7a-Structrual Pest Management, Core only for GUP applications No Additional Training Requirements 18 Kentucky Core Exam Category Specific Exam No Additional Training Requirements 16 Ohio Core Exam Category Specific Exam Wood Destroying Inspector (WDI) 5-Hour Class 18 Idaho Core Exam Category Specific Exam No Additional Training Requirements 18 South Dakota Core Exam Category Specific Exam No Additional Training Requirements 15 Recertification Requirements (CCH/CEU) State  Certification Period  Required Amount of CCH/CEU to Recertify  Other Recertification Options Indiana 5-Years Category Specific ranging from 10-20 CCHs. Available online or in-person Retake the category exam Michigan 3-Years 8 CEUs, plus 8 CEUs for each additional category. Or 8 CEUs and approved employer training program Retake the category exam Illinois 3-Years None, retest for recertification None, retest for recertification Kentucky 3-Years 12 CEUs, only 1 CEU needed in each licensed category Retake the category exam Ohio 3-Years 5 CEUs, ½ CEU in each category licensed Retake the category exam Idaho 2-Years 15 Recertification Credits Retake the category exam South Dakota 2-Years In-Person or Online Recertification Class Retake the category exam Private Applicator Recertification  State Certification Period  Recertification Requirements   Other Recertification Options Indiana 5-Years 3 Private Applicator Recertification Programs (PARP). One PARP can be taken online Retake the core exam Michigan 3-Years Obtain 16 Seminar Credits Retake the private core exam Illinois 3-Years Retake the core exam Retake the core exam Kentucky 3-Years Attend 1 Program Retake the core exam Ohio 3-Years 3 Recertification Hours Retake the core exam Idaho 2-Years 6 Recertification Credits Retake the core exam South Dakota 3-Years Attend 1 Program Retake the core exam Insurance Requirements for Pesticide Business State Required Coverage Amount Additional Requirements  Indiana $300,000 Liability Coverage None Michigan $100,000 Liability Coverage Additional Coverage of $300,000 for Aerial, Fumigation, and Right of Way Applicators Illinois $500,000 Liability Coverage None Kentucky $1 Million Liability Coverage None Ohio $300,000 Liability Coverage Additional Coverage for WDI Inspector, Additional Coverage for Aerial Applicators Idaho $50,000 per person/$100,000 per occurrence, Property Damage coverage of $50,000 per occurrence. None South Dakota $300,000 Liability Coverage None As identified previously in this document, the requirements for certification and recertification have been approved by EPA with our federally required C&T Plan (40 CFR 171). Our recertification standards, as outlined in 355 IAC 4, meet the minimum standards described in 40 CFR 171.107 and have been approved by EPA. OISC is less restrictive than surrounding states because we allow for our certified applicators to recertify within 5 years while the surrounding states require the total CCHs to be completed within 3 years. OISC meets the minimum requirements outlined by the federal government by providing 5 years. According to IC 15-16-5-49, a person may not make diagnostic inspections or reports to determine infestations of wood destroying pests on another person’s property without having obtained a license to act as a licensed applicator for hire (category 7b) or a licensed pest inspector (category 12) from OISC. 355 IAC 4-1-3 provides details of what is included in each category. 355 IAC 4-1-2.1 identifies requirements to obtain an initial certification and that category 7b and 12 require the completion of practical hands-on training programs. This is completed through a 2-day mandatory training course for termiticide applicators (7b) and a 1-day mandatory training course for pest inspectors (12). IC 15-16-5-58 requires both pesticide business licenses and pest inspector licenses to have insurance. In 2023, IC 15-16-5-72 was updated through legislation to specifically allowed for category 7b to require practical hands-on training program to become certified. This is completed through a 2-day mandatory training course. These additional training requirements are necessary because there were a high number of fraudulent and improper termiticide applications being made, costing homeowners a great deal of money for re-treatments or home repairs. Many of the improper applications were due to a lack of training, resulting in applicators being unaware of how to appropriately apply pesticides for the control of termites. Since the initial rule was adopted, complaints in this category have dropped drastically (90% reduction). The one-day training for wood destroying insect inspectors (WDI) was promulgated due to the large number of missed or misdiagnosed wood destroying insect infestations during real estate transactions at great expense to the consumer. The requirement ultimately increased the trust and value of the inspecting industry and the need for the inspection during real estate transactions. OISC cannot say if the need for the inspection during real estate transactions has increased since the rule was promulgated. We can say that complaints about improper reporting of the presence or absence of wood destroying insects have drastically declined after the implementation of the certification and licensing requirements. Regarding the insurance requirements, while there has been no indication that the amounts are too high or too low, during 2012 discussions with industries we learned that many insurance providers no longer provide coverage lower than $300,000. Additional information on the discussions between OISC and Industry is available in the Regulatory Analysis document, section VII.

X. Previous Amendments

355 IAC 4 has been substantially modified within the last eight years. OISC has worked with Indiana Legislators to review our rules and many elements of 355 IAC 4 were moved into Indiana Code in 2024. See summary below, additional details are provided in the Regulatory Readoption document. In 2024, with work from Indiana legislators and OISC, regulatory burden was reduced. Law changes allow for an individual to become a registered technician (apply general use pesticides, for hire), without taking an exam. New hires can watch a video, then immediately begin work (IC 15-16-5-56). Pesticide application record keeping was reduced to the federal minimum of restricted use pesticides only. Notification elements to OISC for termite pretreats were also removed (355-4-5-2(6)). 2024 legislation also allows for the direct supervision of a noncertified applicator, to use restricted use pesticides. Certified supervisors can follow the federal rules for supervision (40 CFR 171.201). Previously, supervision was not allowed for the use of restricted use pesticides (IC 15-16-5-44). 2024 legislation removed bulk pesticide containment requirements from rule and moved the requirements into law, adopting the federal standards (40 CFR 165). Farmers are now largely exempt from the containment requirements. Additionally, containment requirements extend to only those containers designed to hold 500 gallons or more. Previously, any container designed to hold more than 55 gallons of pesticides was required to be in containment.

XI. Integration into Indiana Code

355 IAC 4 has been substantially modified within the last eight years. In 2022, OISC submitted amendments to meet the needs of our required, federally accepted C&T Plan. OISC has worked with Indiana Legislators to review our rules and many elements of 355 IAC 4 were either voided or moved into Indiana Code in 2024.

XII. Contact Information of Staff to Answer Substantive Questions

OISC Contact Information: Sarah K Caffery, Pesticide Administrator, Office of Indiana State Chemist (765) 494-1587 scaffery@purdue.edu Notice of Public Comment Period for Rule Readoption: 20250820-IR-355240622RNA