Neb. Admin. Code tit. 49 — Practice and Procedure

Chapter 1 General Provisions Relating to Practice and Procedure Before the Department of Banking and Finance

Neb. Admin. Code tit. 49, ch. 1 General Provisions Relating to Practice and Procedure Before the Department of Banking and Finance {#sec-49-nac-1 omnilex-key=us-ne-regs-official--title-49--49 NAC 1}

001 GENERAL.

001.01 This Rule has been promulgated pursuant to authority delegated to the Director in Section 84-909 of the Administrative Procedure Act.

001.02 The Department has determined that this Rule is in the public interest.

001.03 The Department has determined that this Rule relating to definitions and general matters be applied to Title 49 of the Nebraska Administrative Code, unless otherwise specified therein.

002 DEFINITIONS. The following words and terms shall have the following meanings, unless the context clearly indicates otherwise.

002.01 APA means the Administrative Procedure Act, Neb. Rev. Stat. §§ 84-901 to 84-920, as adopted on the effective date of this Rule, or as may hereafter be amended.

002.02 Department means the Department of Banking and Finance.

002.03 Director means the Director of the Department of Banking and Finance.

002.04 Hearing officer means the person or persons conducting a hearing, contested case, or other proceeding pursuant to the APA, whether designated as the presiding officer, administrative law judge, or other similar title designation.

002.04A The hearing officer may be the Director or any designee of the Director.

002.04B The hearing officer shall make a recommendation to the Director after the close of the hearing, which the Director may accept or reject in whole or in part.

002.05 Person means an individual, a corporation, a limited liability company, a partnership, an association, a joint stock company, a trust in which the interests of the beneficiaries are evidenced by a security, an unincorporated organization, a government, or a political subdivision of a government.

003 COMPUTATION OF TIME. In computing time prescribed or allowed by any applicable statute or rule in which the method of computing time is not specifically provided, days will be computed by excluding the day of the act or event and including the last day of the period. If the last day of the period falls on a Saturday, Sunday, or legal holiday, the period shall include the next business day.

004 ADMINISTRATION. The main office of the Department, located at Suite 311, The Atrium, 1200 N Street, P.O. Box 95006, Lincoln, Nebraska 68509-5006, is open from the hours of 8 a.m. to 5 p.m., Monday through Friday, legal holidays excepted.

History

• Effective 2002-08-20

Chapter 2 Rule of Practice and Procedure for Application Cases

Neb. Admin. Code tit. 49, ch. 2 Rule of Practice and Procedure for Application Cases {#sec-49-nac-2 omnilex-key=us-ne-regs-official--title-49--49 NAC 2}

001 GENERAL.

001.01 This Rule has been promulgated pursuant to authority delegated to the Director in Section 84-909 of the APA.

001.02 The Department has determined that this Rule is in the public interest.

001.03 The definitions in 49 NAC 1.002 shall apply to the provisions of this Rule, unless otherwise specified.

002 SCOPE. This Rule shall apply to any application filed with the Department, whether or not a hearing is required, set or held, wherein a party submits any of the following:

002.01 An application for a charter to conduct a banking business in accordance with Section 8-120 if the applicant does not qualify for expedited processing under Section 8-115.01;

002.02 An application for a charter of authority to transact a trust company business in accordance with Section 8-201;

002.03 An application for a certificate to conduct a building and loan association, savings and loan association or savings bank in accordance with Sections 8-301, 8-331 and 8-372;

002.04 An application for a license to conduct an industrial loan and investment company in accordance with Section 8-403;

002.05 An application to organize a credit union in accordance with Section 21-1725.01;

002.06 An application for a license to operate an installment loan company in accordance with Section 45-1005 if the applicant does not qualify for expedited processing under Section 45-1006;

002.07 An application to conduct a delayed deposit service business pursuant to Section 45-908;

002.08 An application to establish a trust company business in a trust department of a bank in accordance with Section 8-159, unless the application is made in connection with a merger of affiliate banks;

002.09 An application of a trust company, building and loan association, savings and loan association, savings bank, or industrial loan and investment company to move the charter and main office of said financial institution to a new or different location, if outside the corporate limits of the city in which the financial institution’s charter is located;

002.10 An application by a building and loan association, savings and loan association, or savings bank for the establishment of a branch office;

002.11 An application by an industrial loan and investment company for the establishment of an auxiliary office in accordance with Section 8-403.01;

002.12 An application by a financial institution to acquire another financial institution in a cross industry merger pursuant to Section 8-1510;

002.13 An application to establish a state bank for credit card operations pursuant to Section 8-1511 to 8-1513;

002.14 An application for a charter to conduct a banking business in accordance with Section 8-120 if the applicant qualifies for expedited processing under Section 8-115.01;

002.15 An application for a license to operate an installment loan company in accordance with Section 45-1005 if the applicant qualifies for expedited processing under Section 45-1006;

002.16 An application to acquire a bank for credit card operations pursuant to Sections 8-1511 to 8-1513;

002.17 An application to establish a branch of a bank in accordance with Section 8-157;

002.18 An application to establish a mobile branch of a bank in accordance with Section 8-157;

002.19 An application to establish a branch trust office of a state-chartered trust company or of a bank which has been further chartered to conduct a trust department in a bank in accordance with Section 8-234 or Section 8-2303;

002.20 An application for establishment of a credit union branch in accordance with Section 21-1725.01;

002.21 An application for the move of a main office of a bank;

002.22 An application for the move of a main office of a credit union;

002.23 An application for the move of a branch of a bank;

002.24 An application for the move of a branch of a credit union;

002.25 An application for the move of a main office of a building and loan association, savings and loan association, savings bank, or industrial loan and investment company within the corporate limits of the city in which the charter is located;

002.26 An application for the conversion of a national bank to a state bank;

002.27 An application to establish a trust company business in a trust department of a bank where the application is made in connection with a merger of affiliate banks;

002.28 An application for the move of an installment loan license within the same county;

002.29 An application for the move of a delayed deposit services business license within the same county; and

002.30 An application for the establishment or move of a branch of a delayed deposit services business license within the same county.

003 DEFINITIONS. For purposes of this Rule, the following additional definitions shall apply:

003.01 Affiliate means any entity that controls, is controlled by, or is under common control with another entity.

003.02 Applicant means the person filing the application identified in Section 002 of this Rule with the Department.

003.03 Application case or hearing means a case initiated by the filing of an application identified in Section 002 of this Rule. .

003.04 Ex parte communication means an oral or written communication which is not on the record in an application case with respect to which reasonable notice to all parties was not given. Ex parte communication shall not include:

003.04A Communications which do not pertain to the merits of an application case;

003.04B Communications required for the disposition of ex parte matters as authorized by law;

003.04C Communications in a rulemaking proceeding;

003.04D Communications to which all parties have given consent; and

003.04E Communications between the hearing officer and the Director which occur following the close of the hearing.

003.05 Party means the applicant or any protestant.

003.06 Protestant means a person who makes a written pleading objecting to the granting of an application.

004 PROHIBITIONS AGAINST EX PARTE COMMUNICATIONS.

004.01 Prohibitions; when applicable. The prohibitions found in this Section shall apply beginning at the time notice for hearing is given.

004.02 Prohibitions; to whom applicable.

004.02A Parties and public. A party in a contested case or other person outside the Department having an interest in the application case shall not make or knowingly cause to be made an ex parte communication to the hearing officer or to the Director or any Department employee who is or may reasonably be expected to be involved in the decision making process of the application case.

004.02B Persons in decision making roles. The hearing officer, the Director or any Department employee who is or may reasonably be expected to be involved in the decision making process of the application case shall not make or knowingly cause to be made an ex parte communication to any party in an application case or other person outside the Department having an interest in the application case.

004.02C Investigators. No Department employee engaged in the investigation of an application case shall make or knowingly cause to be made an ex parte communication to a hearing officer or the Director or any Department employee who is or may reasonably be expected to be involved in the decision making process of the application case.

004.03 Disclosure of contacts. The hearing officer or the Director or any Department employee who is or may reasonably be expected to be involved in the decision making process of the application case who receives or who makes or knowingly causes to be made an ex parte communication set forth in Sections 004.02A through 004.02C of this Rule shall file in the record of the application case:

004.03A All such written communications.

004.03B Memoranda stating the substance of all such oral communications.

004.03C All written responses and memoranda stating the substance of all oral responses to all the ex parte communications.

004.04 Filing of notice. The disclosure required in Section 004.03 of this Rule shall be filed within two business days of the receipt or making of the ex parte communication. Notice of the filing, with an opportunity to respond, shall be given to all parties of record.

004.04A The hearing officer or Director shall determine the method by which recipients shall respond to such notice and the time frame in which any response must be filed with the Department.

004.04B Compliance with the provisions of Section 004.03 shall not alter or correct the nature of the original communication for purposes of the definition of ex parte communication.

004.05 The prohibitions and filing requirements established by this Section shall not apply to the Director in any case for which the Director has, in writing, recused himself or herself from participation in the decision making process.

005 APPLICATION.

005.01 An application shall be submitted on the form designated by the Department and shall contain the information requested therein. The application shall be accompanied by the proper filing fee. No application shall be considered filed until the Department has deemed it substantially complete and has accepted it for filing.

005.02 The original and the number of copies specified on each form shall be filed with the Department at its main office. When the form does not specify the number of copies, an original and two copies shall be filed.

006 SETTING OF HEARING.

006.01 Except as otherwise provided by statute, the Department shall automatically schedule a hearing on all applications referenced in Section 002.01 through 002.13 of this Rule. Hearings on applications referenced in Sections 002.14 through 002.30 of this Rule shall be scheduled if the Director determines the financial condition of an applicant warrants a hearing, if notice of the filing of an application has been published and substantive objections, if any, are timely filed with the Department, or if the Director otherwise determines a hearing would be appropriate.

006.02 The time and place of an application hearing will be set according to the following restrictions:

006.02A A hearing on an application for a bank charter will be set and notice given in accordance with Section 8-115.01.

006.02B A hearing on an application to organize a credit union shall be set and notice given in accordance with Section 21-1725.01.

006.02C A hearing on an application for a license to operate an installment loan company shall be set and notice given in accordance with Section 45-1006.

006.02D A hearing on an application filed pursuant to Section 8-403 or Section 8-403.01 will be set and notice given in accordance with Section 8-403.01.

006.02E A hearing on an application for a delayed deposit services business license shall be set and notice given in accordance with Section 45-907.

006.02F In the case of applications for charters, licenses or certificates filed pursuant to Sections 8-120, 8-201, 8-331, 8-372, 8-403, and 8-1510, the hearing date shall be at least 30 days after the date of the last publication of notice, and not more than ninety days after the filing of a substantially complete application, unless the applicant agrees to a later date.

006.02G In all proceedings for which there does not exist a statute or specific rule, setting forth procedure for publication, setting and notice of hearing, the procedure followed for hearing, notice and publication will be in accordance with Section 8-115.01.

006.03 Notwithstanding Sections 006.01 to 006.06 of this Rule, the hearing officer may, in his or her discretion, grant extensions of time or continuances of hearings upon the hearing officer’s own motion or at the timely request of any party for good cause shown.

006.03A Good cause for an extension of time or continuance may include, but is not limited to, the following:

006.03A1 Illness of the party, legal counsel or witness;

006.03A2 A change in legal representation; or

006.03A3 Settlement negotiations are underway.

006.03B A party must file a written motion for continuance which states in detail the reasons why a continuance is necessary and serve a copy of the motion on all other parties to the proceedings or their attorneys.

006.03C Any party requesting a continuance may be required to submit affidavits in support of such requests.

006.03D Only under exceptional circumstances will requests for continuance of a hearing be considered unless submitted at least seven days prior to the hearing date.

007 PROTEST IN AN APPLICATION HEARING OR CASE.

007.01 Except for good cause shown, any person wishing to appear at and participate in an application hearing as a protesting party shall file a written protest with the Director 30 days prior to the date of hearing, unless the law or Department Rules provide otherwise, and shall show service of a copy of the written protest upon the applicant or its attorney. For purposes of this Section, good cause shall have the same meaning as is set forth in Section 006.03A of this Rule.

007.02 All protests shall be subscribed and verified and shall include a statement binding the protestant to pay his, her or its proportionate share of the costs of the hearing under Section 011.06 of this Rule.

008 HEARING OFFICER; CRITERIA.

008.01 The Director may delegate to a hearing officer the functions of conducting a prehearing conference and/or a hearing and submitting a recommended decision to the Director.

008.02 A person who has served as investigator, prosecutor, or advocate in an application case or in its prehearing stage may not serve as hearing officer or assist or advise a hearing officer in the same proceeding except as provided in Section 008.04 of this Rule.

008.03 A person who is subject to the authority, direction, or discretion of a person who has served as investigator, prosecutor, or advocate in an application case or in its prehearing stage may not serve as hearing officer or advise a hearing officer in the same proceeding except as provided in Section 008.04 of this Rule.

008.04 If all parties consent, a person who has served as, or who is subject to the authority, direction, or discretion of a person who has served as, investigator, prosecutor, or advocate in an application case or in its prehearing stage, may assist a hearing officer in the preparation of orders.

008.05 A person may serve as hearing officer at successive stages of the same application case.

009 PREHEARING PROCEDURES.

009.01 In the case of an application for a charter, certificate or license filed pursuant to Sections 8-120, 8-201, 8-331, 8-372, 8-403, or 21-1725.01, for which a protest has been filed, a prehearing conference will be held at the Department's main office at least seven days prior to the date of the hearing, unless all parties agree to waive the prehearing conference. In all other application hearings, the Director or a hearing officer designated to conduct a hearing may determine whether a prehearing conference will be conducted. If a prehearing conference is not held, the Director or the hearing officer for the hearing may issue a prehearing order, based on the pleadings, to regulate the conduct of the proceedings.

009.02 If a prehearing conference is conducted:

009.02A The hearing officer shall promptly notify the Department of the determination that a prehearing conference will be conducted. The Director may assign another hearing officer for the prehearing conference.

009.02B The hearing officer for the prehearing conference shall set the time and place of the conference and give reasonable written notice to all parties and to all persons who have filed written protests in the matter. The Department shall give notice to other persons entitled to notice.

009.02C The notice referred to in Section 009.02B of this Rule shall include the following:

009.02C1 The names and mailing addresses of all parties and other persons to whom notice is being given by the hearing officer;

009.02C2 The name, official title, mailing address, and telephone number of any counsel or employee who has been designated to appear for the Department;

009.02C3 The name of the proceeding, and a general description of the subject matter;

009.02C4 A statement of the time, place, and nature of the prehearing conference;

009.02C5 A statement of the legal authority and jurisdiction under which the prehearing conference and the hearing are to be held;

009.02C6 The name, official title, mailing address, and telephone number of the hearing officer for the prehearing conference;

009.02C7 A statement that a party who fails to attend or participate in a prehearing conference, hearing, or other stage of the application case or who fails to make a good faith effort to comply with a prehearing order may be held in default under the APA; and

009.02C8 Any other matters that the hearing officer considers desirable to expedite the proceedings.

009.03 The hearing officer shall conduct a prehearing conference, as may be appropriate, to deal with such matters as preparation of stipulations, clarification of issues, rulings on identity and limitation of the number of witnesses, objections to proffers of evidence, determination of the extent to which direct evidence, rebuttal evidence, or cross-examination will be presented in written form and the extent to which telephone, television, or other electronic means will be used as a substitute for proceedings in person, order of presentation of evidence and cross-examination, rulings regarding issuance of subpoenas, discovery orders, and protective orders, and such other matters as will promote the orderly and prompt conduct of the hearing. All parties must lay foundation for all their exhibits, except rebuttal exhibits; all objections to the admissibility other than relevancy, must be made; and an outline or synopsis of the evidence relative to each of the items required for the relevant application set forth in Title 49, Chapter 3 of the Nebraska Administrative Code must be submitted.

009.03A The hearing officer may issue a prehearing order incorporating the matters determined at the prehearing conference.

009.03B The hearing officer may, if there is not sufficient time for adequate written notice to the parties prior to the hearing, provide oral notice to the parties at the close of the pre-hearing conference of the matters determined at the pre-hearing conference. Such oral notice shall be made on the record, if the pre-hearing conference is recorded.

009.04 The hearing officer may conduct all or part of the prehearing conference by telephone, television, or other electronic means if each participant in the conference has an opportunity to participate in the entire proceeding while it is taking place.

010 DISCOVERY IN APPLICATION CASES.

010.01 Except as provided in Section 010.03 of this Rule, at least ten days prior to the date of the hearing or at the time of the pre-hearing conference, whichever is earlier, all parties to the proceeding, including applicant, proponents, and protestants, shall file with the Director or hearing officer a list of all witnesses who will appear to testify at the hearing. This list shall include all relevant information on witnesses' background, along with the witnesses' qualifications to testify. Each party shall serve such a list on the Department and on each other party to the proceeding or its attorneys.

010.02 Except as provided in Section 010.03 of this Rule, at least ten days prior to the date of the hearing or at the time of the pre-hearing conference, whichever is earlier, each party to the proceeding shall file with the Director or hearing officer a copy of each exhibit to be introduced at the hearing. A copy of each exhibit shall also, at least ten days prior to the date of the hearing, be served on each other party to the proceeding, or its attorneys. The foundation for each exhibit must accompany the exhibit in compliance with Section 011.02C of this Rule. Rebuttal exhibits are limited to those solely in rebuttal to testimony or exhibits introduced at the hearing which were not required to be submitted or produced until offered.

010.03 The Director may accept the late filing of materials enumerated under this Section for good cause shown. For purposes of this Section, good cause shall have the same meaning as is set forth in Section 006.03A of this Rule.

010.04 If a continuance of the hearing is granted under Section 006.03 of this Rule, the time schedule for submitting material under this Section shall be set by the hearing officer.

010.05 When a filing or submission date falls on a weekend or legal holiday, the date for such filing or submission shall be the next business day.

010.06 A document submitted by facsimile transmission shall not be sufficient to satisfy the requirements of this Section, unless previously authorized by the hearing officer.

010.07 The hearing officer or a designee, at the request of any party, or the Department, or upon the hearing officer’s own motion, may issue subpoenas, discovery orders, and protective orders in accordance with the Nebraska Rules of Civil Procedure except as may otherwise be prescribed by law. Subpoenas and orders issued under this Subsection may be enforced by the District Court of Lancaster County, Nebraska.

010.08 Any prehearing motion to compel discovery, motion to quash, motion for protective order or other discovery-related motion shall:

010.08A Quote the interrogatory, request, question, or subpoena at issue, or be accompanied by a copy of the interrogatory, request, subpoena or excerpt of a deposition;

010.08B State the reasons supporting the motion;

010.08C Be accompanied by a statement setting forth the steps or efforts made by the moving party or his or her counsel to resolve by agreement the issues raised and that agreement has not been achieved; and

010.08D Be filed with the Department. The moving party must serve copies of all such motions to all parties to the application case.

010.09 Other than is provided in Section 010.08D of this Rule, discovery materials need not be filed with the Department.

011 HEARING.

011.01 Order.

011.01A Evidence will be received in the following order:

011.01A1 The Department shall offer into evidence as exhibits copies of the application, notice of hearing, proof of publication of the notice of hearing, proof of payment of the application fee and all protests or other correspondence received pertaining to the application. Said exhibits shall not be offered to prove the truth of any statement contained therein.

011.01A2 Applicant.

011.01A3 Protestants.

011.01A4 Rebuttal by Applicant.

011.01A5 Rebuttal by Protestants.

011.01B A party to the hearing will be allowed to:

011.01B1 Make an opening statement;

011.01B2 Present evidence and argument thereto;

011.01B3 Cross examine witnesses;

011.01B4 Present rebuttal evidence;

011.01B5 Make relevant motions concerning the conduct of the proceedings or the introduction of evidence; and

011.01B6 Make a closing statement.

011.01C A person who has not filed a pleading in accordance with Sections 005 or 007 of this Rule will be given a reasonable period of time to make a statement at the public hearing. The hearing officer shall determine when statements by any such person may be made during the hearing. Such person shall not have any of the authority allowed a party under this Rule. Such person is subject to examination by the parties to the hearing, the Director, representatives of the Department, and the hearing officer.

011.01D The Director or hearing officer may establish time restrictions for the presentation of evidence upon the motion of any party or upon his or her own order.

011.02 Evidence.

011.02A In application cases, the Director or hearing officer may admit and give probative effect to evidence which possesses probative value commonly accepted by reasonably prudent persons in the conduct of their affairs and may exclude incompetent, irrelevant, immaterial and unduly cumulative or repetitious evidence.

011.02B Any party to an application hearing before the Department may request that the parties be bound by the rules of evidence applicable in district court by delivering to the Department at least three days prior to the holding of the hearing a written request therefore. Such request shall include the requesting party’s agreement to be liable for the payment of costs incurred thereby and upon any appeal or review thereof, including the cost of court reporting services.

011.02C Documentary evidence may be received in the form of copies or excerpts or incorporated by reference.

011.02C1 The foundation for exhibits, including an application submitted pursuant to this Rule shall be supported orally or in writing. Any party desiring to lay foundation to an exhibit by oral testimony shall give written notice to the Department and all other parties at the time the exhibit is submitted pursuant to Section 010.02 of this Rule. An application submitted pursuant to this Rule will be considered as substantive evidence.

011.02C2 Parties shall furnish accurate copies of all documentary evidence offered at the hearing to the Official Reporter, to the Director or hearing officer, and to all parties to the proceeding.

011.02C3 When documents are numerous, such as bank records or negotiable instruments, the Director or hearing officer may refuse to receive in evidence more than a limited number alleged and appearing to be representative. The party will be required to abstract in orderly fashion the relevant data from these documents, affording other parties reasonable opportunity to examine both the documents and the abstract, and thereupon offer the abstract in evidence in exhibit form.

011.02C4 Relevant portions of books, papers or documents shall be plainly designated and distinguished from all irrelevant portions before the relevant material may be offered into evidence. Where the irrelevant material in the book, paper or document is voluminous so as to encumber the record, the book, paper or document may be marked for identification and the relevant material read into the record. Upon direction of the Director or hearing officer, a true copy of the relevant matter may be received as an exhibit, provided that copies are delivered to all parties of record and provided all parties of record are afforded an opportunity to examine the book, paper or document and to offer in evidence in like manner other portions thereof, if found to be material and relevant.

011.02C5 All of the exhibits introduced in evidence shall be confined to a maximum size of 8 1/2 inches x 11 inches or be placed upon paper which may be folded to such size.

011.02C5(1) Enlarged charts of exhibits may be utilized at the hearing but the exhibit to be made a part of the record shall be of such size as heretofore stated.

011.02C6 Exhibits may be sealed upon a determination by the Director or hearing officer that the exhibits contain information which is confidential in nature and which, if made public, could harm any person.

011.02D All evidence including records and documents in the possession of the Department of which it desires to avail itself shall be offered and made a part of the record in the case. No factual information or evidence other than the record shall be considered in the determination of the case.

011.02D1 The Director or any person or persons designated by the Director may make such investigations as deemed necessary to assist in the determination of matters pending before the Department. Any finding or exhibits resulting from such investigation which the Director uses in making a decision shall be included and become a part of the evidence of such matter.

011.02D2 Any party desiring to introduce into evidence any part or parts of official files of the Department shall obtain certified copies thereof from the Department in advance of the hearing.

011.02E A hearing officer or designee may administer oaths and issue subpoenas in accordance with the rules of civil procedure except as may otherwise be prescribed by law.

011.02F The Department shall give effect to the rules of privilege recognized by law.

011.02G The Department may take administrative notice of cognizable facts and in addition may take administrative notice of general, technical, or scientific facts within its specialized knowledge and its rules adopted and promulgated pursuant to the APA.

011.02G1 Parties shall be notified either before or during the hearing or by reference in preliminary reports or otherwise of materials so noticed.

011.02G2 Parties shall be afforded an opportunity to contest facts so noticed.

011.02G3 The record shall contain a written record of every fact or item administratively noticed.

011.02H The Department may utilize its experience, technical competence and specialized knowledge in the evaluation of the evidence presented to it.

011.02I Parties to any proceeding may agree upon any facts involved in the controversy, either by written stipulation entered into the record as an exhibit, or by oral agreement stated on the record; provided, that the Department shall not be irrevocably bound by such stipulation.

011.02J During any proceedings, the Director or hearing officer may request any party to furnish and serve designated late filed exhibits. Such exhibits shall be filed within such time as specified by the Director or hearing officer.

011.02K Any party may appear in his/her own behalf at the hearing. An individual may appear on behalf of a party only if he or she:

011.02K1 Is an officer, director, or shareholder of a party which is the applicant in an application case to which no protest has been filed;

011.02K2 Is admitted to practice law before the Nebraska Supreme Court; or

011.02K3 Is admitted to and engaged in the practice of law in the courts of record of another state, the District of Columbia, or a territory of the United States, and has associated with and is appearing with an attorney who is a resident of Nebraska, duly and regularly admitted to practice in the courts of record of this state, and upon whom service may be had in all matters connected with the action with the same force and effect as if personally made on such foreign attorney within this state, upon the filing of an appropriate pro hac vice motion with the Department.

011.02L The Director, hearing officer, or any person designated by the hearing officer shall administer an oath to all witnesses providing testimony in an administrative case prior to their testimony.

011.02L1 Every party to a contested case shall have the right to cross-examine each witness who testifies at a hearing. Where it appears that the cross-examination by one party will protect the rights of all parties similarly situated, the hearing officer may limit cross-examination to one party on either side of an issue.

011.02L2 A subpoena requiring the attendance of a witness shall be issued by the Director or hearing officer, on good cause shown, for the purpose of taking evidence or compelling the production of any papers, books, accounts, and documents which are relevant and material to the hearing.

011.02L2(a) A party directed to produce accounts, books, documents, or papers shall furnish and deliver the same at the time and place to the person specified in the subpoena.

011.02L2(b) A subpoena issued pursuant to this Rule may be served in any manner permitted by law including service by certified or registered mail, return receipt requested.

011.02L2(c) In the case of disobedience of a subpoena, the Director may invoke the aid of the applicable District Court in requiring the attendance and testimony of witnesses and in the production of accounts, books, documents, or papers.

011.02L2(d) Charges for serving a subpoena are to be paid prior to the date set for hearing by the party at whose instance the subpoena is issued.

011.02L3 Any witness who is subpoenaed and who responds thereto is entitled to the same fee as is paid for like service in the District Courts of Nebraska. Such fee is to be paid by the party at whose instance the witness's testimony is to be taken.

011.02L4 Sequestration of witnesses shall not be permitted in application cases.

011.03 Post hearing submissions.

011.03A Submission of briefs may be required, or permitted at the request of a party, by the Director or the hearing officer. The time in which briefs shall be filed and the number of copies required will be fixed at the close of the hearing by the Director or the hearing officer. Briefs submitted to the Department shall be on white paper, 8 ½ x 11 inches, with margins of at least 1 inch on all sides, and shall be double spaced. No brief shall be longer than 25 pages. The Department will not consider any portion of the brief which exceeds the page limitation.

011.03B The hearing officer may request the parties to submit proposed findings of fact and conclusions of law in lieu of, or in addition to, briefs pursuant to Section 011.03A of this Rule. The hearing officer shall establish the time schedule for such filing and any other restrictions that he or she deems appropriate under the circumstances.

011.04 Conducting the hearing by electronic means. The Director or hearing officer may conduct all or part of the hearing by telephone, television, or other electronic means if each participant in the hearing has an opportunity to participate in the entire proceeding while it is taking place.

011.05 Official record.

011.05A The Department shall prepare an official record, which shall include testimony and exhibits, in each application case, but it shall not be necessary to transcribe the record of the proceedings unless requested for purpose of rehearing or appeal, in which event the transcript and record shall be furnished by the Department upon request and tender of the cost of preparation.

011.05B The Department shall maintain an official record of each application case under the APA for at least four years following the date of the final order.

011.05C The Department record shall consist only of the following:

011.05C1 Notices of all proceedings;

011.05C2 The application, and any protest, pleadings, motions, requests, preliminary or intermediate rulings and orders, and similar correspondence to or from the Department pertaining to the application case;

011.05C3 The record of the hearing before the Department, including all exhibits and evidence introduced during such hearing, a statement of matters administratively noticed by the Director or hearing officer during the proceeding, and all proffers of proof and objections and rulings thereon; and

011.05C4 The final order.

011.05D As provided in Section 004.03 of this Rule, the hearing officer or Director, or Department employee who is or may reasonably be expected to be involved in the decision making process of the application case who receives or who makes or knowingly causes to be made an ex parte communication as set forth in that Section shall make the appropriate filings which shall be included in the official record of the application case.

011.05E Except to the extent that the APA or another statute provides otherwise, the Department record shall constitute the exclusive basis for Department action in application cases pursuant to this Rule and for judicial review thereof.

011.05F In proceedings where a record is not required by law, any party may request and obtain an official record of the proceedings, provided said request is in writing and delivered to the Director at least five days prior to the date of hearing. The cost of preparing the official record shall be born by the parties requesting its preparation.

011.06 The costs of the hearing, including, but not limited to, court reporter fees, fees for the Director's time, and fees and expenses of the hearing officer, shall be apportioned by the Department between the parties based upon their proportionate involvement in the hearing, unless a party has requested the rules of evidence under Section 011.02B of this Rule.

012 DECISION AND ORDER.

012.01 Every decision and order rendered by the Department in an application case shall be in writing or stated in the record and, if in writing, shall be accompanied by findings of fact and conclusions of law.

012.02 The decision and order should include:

012.02A The name of the Department and name of the proceeding;

012.02B The time and place of the hearing;

012.02C The names of all parties and their attorneys who entered an appearance at the hearing;

012.02D The findings of fact consisting of a concise statement of the conclusions upon each contested issue of fact;

012.02E The conclusions of law consisting of the applications of the controlling law to the facts found and the legal results arising therefrom, including specific conclusions regarding the requirements of the specific application as set forth in 49 NAC 3 (Proof Requirements for Granting of Applications); and

012.02F The order consisting of the action taken by the Department as a result of the facts found and the legal conclusions arising therefrom.

012.03 The Department may impose conditions precedent in any order issued in an application case.

012.04 Parties to the proceeding shall be notified of the decision and order by mailing a copy of the decision and order and accompanying findings and conclusions to each party or its attorney of record.

012.05 For good cause, the Director may, by order, delegate the final decision making authority in an application case to an appropriate Department employee.

013 APPEALS.

013.01 Any person aggrieved by a final decision in an application case is entitled to judicial review under the APA or to resort to such other means of review as may be provided by law.

013.02 Parties desiring to appeal a Department decision must file a petition for review in the District Court of Lancaster County, Nebraska, within 30 days after the service of the final decision by the Department. The 30-day period for appeal commences to run from the date of mailing of the notice of order and decision to the parties or their attorneys of record. Service of the petition and summons must be made in accordance with Nebraska law.

013.03 The APA governs the procedure for taking an appeal.

History

• Effective 2002-08-20

Chapter 3 Proof Requirements for Granting of Applications

Neb. Admin. Code tit. 49, ch. 3 Proof Requirements for Granting of Applications {#sec-49-nac-3 omnilex-key=us-ne-regs-official--title-49--49 NAC 3}

001 GENERAL.

001.01 This Rule has been promulgated pursuant to authority delegated to the Director in Section 84-909 of the APA.

001.02 The Department has determined that this Rule is in the public interest.

001.03 The definitions in 49 NAC 1.002 shall apply to the provisions of this Rule, unless otherwise specified.

001.04 This Rule applies to all application cases whether or not a hearing is required, set, or held.

001.05 The requirements of this Rule are not all inclusive. An applicant must comply with any additional standards required by applicable statute, other Rules of the Department, and as prescribed in the forms of the Department.

002 BURDEN OF PROOF. The burden of proof in an application case shall be upon the applicant.

003 FINANCIAL CONDITION. Every applicant must show that there will be no adverse effect on its financial condition if its application is approved.

004 APPLICATIONS FOR CHARTERS, LICENSES, OR CERTIFICATES OF AUTHORITY.

004.01 An applicant for a charter to engage in a banking business must show to the Department that:

004.01A The application will promote the public necessity of the community where the applicant proposes to be located;

004.01B The application will promote the convenience and advantage of the community where the applicant proposes to be located; and

004.01C There is a substantial likelihood that there will be no adverse effect on existing financial institutions in the applicant’s proposed primary service area, other than normal competitive effects, if the application is approved.

004.02 An applicant for a certificate to conduct a building and loan association, savings and loan association, or savings bank must show to the Department that:

004.02A There is a need for such an institution in the community where the applicant proposes to be located;

004.02B The application will not result in undue injury to properly conducted local building and loan associations, savings and loan associations, or savings banks; and

004.02C There is a reasonable probability of usefulness and success for the applicant as a result of the application.

004.03 An applicant for a license to conduct an industrial loan and investment company must show to the Department that:

004.03A The application will promote the public necessity of the community where the applicant proposes to be located;

004.03B The application will promote the convenience and advantage of the community where the applicant proposes to be located; and

004.03C There is a substantial likelihood that there will be no adverse effect on existing financial institutions in the applicant’s proposed primary service area, other than normal competitive effects, if the application is approved.

004.04 An applicant for a certificate of approval to organize a credit union must show to the Department that:

004.04A Conditions existing are favorable for the success of the applicant. In making this determination, the Department will consider, among other things:

004.04A1 The character and general fitness of management, and its ability to effectively handle financial matters;

004.04A2 The number of potential members of the applicant, and the depth of the proposed members’ support;

004.04A3 Whether existing credit unions are adequately serving applicant’s proposed membership;

004.04A4 The business plan submitted as part of the applicant’s application for federal insurance of its accounts;

004.04B The proposed location has the potential for attracting members to applicant’s field of membership; and

004.04C The proposed credit union will not result in undue injury to existing credit unions.

004.05 An applicant for a charter of authority to transact a trust company business must show to the Department that:

004.05A The application will promote the public necessity of the community where the applicant proposes to be located;

004.05B The application will promote the convenience and advantage of the community where the applicant proposes to be located;

004.05C There is a substantial likelihood that there will be no adverse effect on existing financial institutions in the applicant’s proposed primary service area, other than normal competitive effects;

004.05D The applicant has the expertise to conduct a trust business;

004.05E The applicant has adopted the Statement of Principles of Trust Management; and

004.05F The applicant has the capacity to inject additional capital if the application is approved.

004.06 An applicant for an amendment to a bank charter to conduct a trust company business in a trust department of the bank must show to the Department that:

004.06A The applicant has the expertise, or can readily obtain the expertise, to conduct a trust business;

004.06B The trust department will be separate and apart from every other department in the bank;

004.06C The applicant has adopted the Statement of Principles of Trust Management; and

004.06D The applicant has the capacity to inject additional capital if the application is approved.

004.07 An applicant for a license to operate an installment loan company must show to the Department that allowing it to engage in business will promote the convenience and advantage of the community in which it proposes to conduct business. In making this determination, the Department will consider, among other things:

004.07A The convenience of the locations of any existing licensees to residents of the area as compared to convenience of the applicant’s proposed location;

004.07B The number of persons in the area who desire to use the services of the applicant and the amount of business they would generate;

004.07C The benefits and advantages to the community offered by the applicant or which would result if the application is approved; and

004.07D The services, products, fees, charges, and rates which the applicant proposes in connection with its business.

005 APPLICATIONS TO MOVE CHARTERS, LICENSES, OR CERTIFICATES OF AUTHORITY.

005.01 An applicant for the move of the charter and main office of a bank outside the corporate limits of the city where the charter is located must show to the Department that:

005.01A The application will promote the public necessity of the community where the applicant proposes to relocate;

005.01B The application will promote the convenience and advantage of the community where the applicant proposes to relocate;

005.01C There is a substantial likelihood that there will be no adverse effect on existing financial institutions in the applicant’s proposed primary service area, other than normal competitive effects, if the application is approved; and

005.01D Proof that the move will have a minimal effect on applicant’s existing customers in the community being vacated. Such proof may be shown by the existence of a branch in that community. If an applicant cannot provide such proof, it must submit a proposal to continue to serve such customers on a limited basis.

005.02 An applicant for the move of the certificate of authority and main office of a building and loan association, a savings and loan association, or a savings bank outside the corporate limits of the city where the institution is located must show to the Department that:

005.02A There is a need for such an institution in the community where the applicant proposes to relocate;

005.02B The move will not result in undue injury to properly conducted building and loan associations, savings and loan associations, or savings banks located in the community where the applicant proposes to relocate;

005.02C There is a reasonable probability of usefulness and success for the applicant as a result of the move; and

005.02D Proof that the move will have a minimal effect on applicant’s existing customers in the community being vacated. Such proof may be shown by the existence of a branch in that community. If an applicant cannot provide such proof, it must submit a proposal to continue to serve such customers on a limited basis.

005.03 An applicant for the move of a license and main office of an industrial loan and investment company outside the corporate limits of the city in which the license is located must show to the Department that:

005.03A The application will promote the public necessity of the community where the applicant proposes to relocate;

005.03B The application will promote the convenience and advantage of the community where the applicant proposes to relocate;

005.03C There is a substantial likelihood that there will be no adverse effect on existing financial institutions in the applicant’s proposed primary service area, other than normal competitive effects, if the application is approved; and

005.03D Proof that the move will have a minimal effect on applicant’s existing customers in the community being vacated. Such proof may be shown by the existence of a branch in that community. If an applicant cannot provide such proof, it must submit a proposal to continue to serve such customers on a limited basis.

005.04 An applicant for the move of the certificate of approval and main office of a credit union outside the corporate limits of the city in which the license is located must show to the Department that:

005.04A The proposed location will benefit existing members of the applicant;

005.04B The proposed location has the potential for attracting new members to applicant’s field of membership;

005.04C The proposed location will be adequately staffed and supervised; and

005.04D Proof that the move will have a minimal effect on applicant’s existing members residing in the community being vacated. Such proof may be shown by the existence of a branch in that community. If an applicant cannot provide such proof, it must submit a proposal to continue to serve such members on a limited basis.

005.05 An applicant for the move of the charter and main office of a trust company outside the corporate limits of the city in which the charter is located must show to the Department that:

005.05A The application will promote the public necessity or need of the community where the applicant proposes to relocate;

005.05B The application will promote the convenience and advantage of the community where the applicant proposes to relocate;

005.05C There is a substantial likelihood that there will be no adverse effect on existing financial institutions in the applicant’s proposed primary service area, other than normal competitive effects, if the application is approved; and

005.05D Proof that the move will have a minimal effect on applicant’s existing customers in the community being vacated. Such proof may be shown by the existence of a branch trust office in that community. If an applicant cannot provide such proof, it must submit a proposal to continue to serve such customers on a limited basis.

005.06 An applicant for the move within the corporate limits of the city of the main office of a bank, building and loan association, savings and loan association, savings bank, industrial loan and investment company, credit union, trust company, or installment loan company must provide to the Department:

005.06A An explanation of the reasons for the move;

005.06B An analysis of the financial feasibility of the move, including a discussion of the disposition of the applicant’s current premises; and

005.06C An explanation of the effect that closing the existing office will have on applicant’s existing customers.

006 APPLICATIONS TO ESTABLISH BRANCH OR AUXILIARY OFFICES.

006.01 An applicant to establish a branch of a bank must submit to the Department:

006.01A A written business plan which contains:

006.01A1 A description of the activities to be conducted and the services provided at the proposed branch;

006.01A2 If the description contained in Section 006.01A1 of this Rule, differs, in whole or in part, from applicant’s business at any of its existing offices, a discussion of the expertise available to the applicant for the successful conduct of the activities;

006.01A3 A showing of adequate staffing and supervision;

006.01B An analysis of the financial feasibility of the proposal, including pro forma financial statements for the office for three years following opening; and

006.01C The proposed name of the branch and the name of every other bank and bank branch office located in the same city, village, or county.

006.02 An applicant to establish a mobile branch of a bank shall submit to the Department:

006.02A A description of the services to be provided through the mobile branch;

006.02B A description of the vehicle(s) to be used as the mobile branch;

006.02C The proposed boundaries of the mobile branch;

006.02D Information regarding any planned fixed stops for the mobile branch;

006.02E Security measures and procedures; and

006.02F Proof that its bond will cover the activities of the mobile branch.

006.03 An applicant to establish a branch of a building and loan association, savings and loan association, or savings bank must show to the Department that:

006.03A There is a need for such a branch in the community where the applicant proposes to be located;

006.03B The application will not result in undue injury to properly conducted local building and loan associations, savings and loan associations, or savings banks;

006.03C The proposed location will be adequately staffed and supervised; and

006.03D There is a reasonable probability of usefulness and success for the applicant as a result of the application.

006.04 An applicant to establish an auxiliary office of an industrial loan and investment company must show to the Department that:

006.04A The application will promote the public necessity or need of the community where the applicant proposes to be located;

006.04B The application will promote the convenience and advantage of the community where the applicant proposes to be located;

006.04C There is a substantial likelihood that there will be no adverse effect on existing financial institutions in the applicant’s proposed primary service area, other than normal competitive effects, if the application is approved;

006.04D The proposed location will be adequately staffed and supervised; and

006.04E The proposal is financially feasible.

006.05 An applicant to establish a branch of a credit union must show to the Department that:

006.05A The proposed location has the potential for attracting new members to applicant’s field of membership or for providing more convenient or cost-effective services to existing members;

006.05B The proposed location will be adequately staffed and supervised;

006.05C The proposal is financially feasible; and

006.05D If any office is to be closed as a result of the application, the effect on existing members will be minimal.

006.06 An applicant to establish a branch trust office of a state-chartered trust company or a branch trust office of a bank which has been further chartered to conduct a trust department in a bank must submit to the Department:

006.06A Information which will allow the Director to conclude there is a need in the community for the office and that its establishment would be in the public interest. Such information shall include:

006.06A1 A description of the services to be provided and activities to be conducted at the proposed branch trust office;

006.06A2 Information regarding the availability and type of trust services in the proposed primary service area;

006.06A3 A reasonable projection of the number of persons who are likely to need and use trust services, and the basis for such projection;

006.06A4 If the branch trust office is to be located in another state pursuant to the Interstate Trust Company Office Act, the applicant shall also submit a description of services to be provided and activities to be conducted that are permissible for a trust company chartered by the host state where the branch trust office is to be located or for a national bank authorized to conduct a trust company business within the host state that would not be permissible for a trust company chartered under the Nebraska Trust Company Act;

006.06B A showing of adequate staffing and supervision;

006.06C An analysis of the financial feasibility of the proposal, including pro forma financial statements for the three years following opening of the office;

006.06D Proof that the applicant is currently in compliance with the Statement of Principles of Trust Management; and

006.06E If the applicant is a bank which has been further chartered to conduct a trust department, the applicant must also discuss its procedures to ensure that no banking activities will be conducted at the proposed location.

007 APPLICATIONS TO MOVE BRANCH OR AUXILIARY OFFICES.

007.01 An applicant to move a branch of a bank, building and loan association, savings and loan association, or savings bank, or an applicant to move a branch trust office, or an applicant to move an auxiliary office of an industrial loan and investment company, must provide to the Department:

007.01A An explanation of the reasons for the move;

007.01B Proof that closing the existing office will have a minimal effect on applicant’s existing customers. If an applicant cannot provide such proof, it must submit a proposal to continue to serve such customers on a limited basis;

007.01C The proposal is financially feasible; and

007.01D If the move is outside the corporate limits of the city where the office is currently is located, an applicant must also provide:

007.01D1 A written business plan which contains:

007.01D1(a) A description of the activities to be conducted at the proposed location;

007.01D1(b) If the description contained in 007.01D1(a), above, differs, in whole or in part, from applicant’s business at any of its existing offices, a discussion of the expertise available to the applicant for the successful conduct of the activities;

007.01D1(c) A showing of adequate staffing and supervision; and

007.01D2 Pro forma financial statements for the office for the three years following opening.

007.02 An applicant to move to move a branch of a credit union must show to the Department that:

007.02A The proposed location will benefit existing members of the applicant;

007.02B The proposed location has the potential for attracting new members to applicant’s field of membership;

007.02C The proposed location will be adequately staffed and supervised;

007.02D The effect on existing members if any office is to be closed as a result of the application will be minimal; and

007.02E The proposal is financially feasible.

008 OTHER APPLICATIONS.

008.01 An applicant for a cross industry acquisition or merger must show to the Department that:

008.01A The application will promote the public necessity of the community or communities where the applicant proposes to be additionally located as a result of the application;

008.01B The application will promote the convenience and advantage of the community or communities where the applicant proposes to be additionally located as a result of the application; and

008.01C The customers of the financial institution to be acquired or merged will be adequately served following the acquisition or merger.

008.02 An applicant to acquire a bank for credit card operations must submit:

008.02A The designation and mailing address of a resident of Nebraska as the applicant’s agent for service of paper, notice or legal process;

008.02B A statement that it agrees to be bound by the conditions set forth in Section 8-1512 and this Rule;

008.02C A copy of any application, applications, or other documents required by appropriate federal authorities for the ownership of a bank, the primary or sole purpose of which is to make loans pursuant to a credit card or transaction card; and a copy of its federal charter, if the applicant is a federally chartered institution as defined in Section 8-1512;

008.02D A copy of any application, applications, or other documents required by appropriate state authorities for the ownership of a bank, the primary or sole purpose of which is to make loans pursuant to a credit card or transaction card; and a copy of its state charter, if the applicant is a state chartered institution as defined in Section 8-1512;

008.02E Copies of all contracts with a qualifying association, if the applicant contemplates such a contractual relationship; and

008.02F Information allowing the Director to reasonably determine that the requirements of Section 8-1513(2) will be met.

008.03 An applicant to acquire an out-of-state bank and establish a branch or branches in that state (“host state”) pursuant to the Interstate Branching by Merger Act of 1997, must submit to the Department:

008.03A Proof that the proposed transaction is authorized under the laws of the host state; and

008.03B A description of activities to be conducted at the out-of-state branch or branches that are permissible for a bank chartered by the host state where the branch is to be located that would not be permissible for a bank chartered under the Nebraska Banking Act.

008.04 An applicant to establish a representative trust office of a state-chartered trust company or a representative trust office of a bank which has been further chartered to conduct a trust department in a bank must submit to the Department:

008.04A Proof that the activities at the representative trust office will be limited to nonfiduciary activities, and procedures to ensure such limitations;

008.04B Information which will allow the Director to conclude that the establishment of the representative trust office would be in the public interest. Such information shall include:

008.04B1 A description of the nonfiduciary services to be provided and activities to be conducted at the proposed representative trust office;

008.04B2 A reasonable projection of the number of persons who are likely to need and use nonfiduciary trust services, and the basis for such projection;

008.04B3 If the representative trust office is to be located in another state pursuant to the Interstate Trust Company Office Act, the applicant shall also submit a description of services to be provided and activities to be conducted that are permissible for a trust company chartered by the host state where the branch trust office is to be located or for a national bank authorized to conduct a trust company business within the host state that would not be permissible for a trust company chartered under the Nebraska Trust Company Act;

008.04C A showing of adequate staffing and supervision; and

008.04D If the applicant is a bank which has been further chartered to conduct a trust department, the applicant must also discuss its procedures to ensure that no banking activities will be conducted at the proposed location.

009 PUBLIC NECESSITY OR NEED.

009.01 For purposes of this Rule, in determining whether an application would promote the public necessity or need, the Department will examine whether the applicant will promote the legitimate interests of the community as a whole.

009.02 An applicant must demonstrate that it has a sound financial institution structure that is reasonably competitive, fully adequate for the needs of the community and operated on a profitable basis.

009.03 In making these determinations, the Department will consider, among other things:

009.03A The size of the primary and secondary service area;

009.03B The demographics of the primary service area;

009.03C The agricultural, commercial, residential and industrial development of the primary and secondary service areas;

009.03D The potential growth of the area;

009.03E The number and size of any financial institutions already serving the proposed primary and secondary service areas; and the dates when they were established;

009.03F The adequacy of the services being provided by the existing financial institutions compared to the needs of the residents and the services to be offered by the applicant. Services may include electronic banking; and

009.03G The capability of existing financial institutions to handle potential development and growth of the area.

010 CONVENIENCE AND ADVANTAGE OF THE COMMUNITY. For purposes of this Rule, in determining whether an application would promote the convenience and advantage of the community, the Department will consider, among other things:

010.01A The convenience of the locations of any existing financial institutions to residents of the area as compared to convenience of the applicant’s proposed location;

010.01B The number of persons in the area who desire to use the proposed financial institution and the amount of business they would generate;

010.01C The benefits and advantages to the community offered by the applicant or which would result if the application is approved; and

010.01D Applicant’s most recent federal Community Reinvestment Act evaluation, if any.

History

• Effective 2002-08-20

Chapter 4 Rule of Practice and Procedure for Hearings in Contested Cases

Neb. Admin. Code tit. 49, ch. 4 Rule of Practice and Procedure for Hearings in Contested Cases {#sec-49-nac-4 omnilex-key=us-ne-regs-official--title-49--49 NAC 4}

001 GENERAL.

001.01 This Rule has been promulgated pursuant to authority delegated to the Director in Section 84-909 of the APA.

001.02 The Department has determined that this Rule is in the public interest.

001.03 The definitions in 49 NAC 1.002 shall apply to the provisions of this Rule, unless otherwise specified.

002 SCOPE. This Rule shall apply to all contested case hearings before the Department, except application hearings covered by 49 NAC 2.

003 DEFINITIONS. For purposes of this Rule, the following additional definitions shall apply:

003.01 Contested case means a proceeding before the Department in which the legal rights, duties, or privileges of specific parties are required by law or constitutional right to be determined after a Department hearing. A contested case proceeding may encompass any matter within the jurisdiction of the Department where a complaint is made against any charter or license holder. Contested case includes, but is not limited to, the following actions:

003.01A Orders revoking the approval of a bank director pursuant to Neb. Rev. Stat. § 8-126.

003.01B Orders revoking an executive officer’s license pursuant to Neb. Rev. Stat. § 8-139.

003.01C Orders revoking, denying or suspending a registration or license pursuant to Neb. Rev. Stat. §§ 8-1103, 8-1109, 8-1109.01, 45-1033, 45-346, 45-706, 45-717, or 45-922.

003.01D Orders to cease and desist from violations of statutes enforced by the Department pursuant to Neb. Rev. Stat. §§ 8-1108.01, 8-1717, 21-1732, 45-1019, 45-1020, 45-157, 45-191.09, 45-350, 45-353, 45-171, 45-923, 59-1725, or 69-2117.

003.01E Orders disallowing an exemption from registration under the Securities Act of Nebraska pursuant to Neb. Rev. Stat. § 8-1111(11) or (15).

003.01F Orders denying an exemption from registration under the Securities Act of Nebraska pursuant to Neb. Rev. Stat. § 8-1111(2).

003.01G Orders imposing administrative fines pursuant to Neb. Rev. Stat. §§ 8-1108.01, 8-1717, 45-1017, 45-191.09, 45-351, 45-171.01, 45-921, 59-1725, or 69-2117.

003.01H Orders barring or censuring an individual registered or licensed by the Department pursuant to Neb. Rev. Stat. § 8-1108.01.

003.01I Orders restricting the making of loans by a credit union pursuant to Neb. Rev. Stat. § 21-1732.

003.01J Orders suspending or prohibiting a credit union official from participating in the management of the credit union pursuant to Neb. Rev. Stat. § 21-1732.

003.01K Orders issued pursuant to Neb. Rev. Stat. §§ 8-1,134 to 8-1,139.

003.01L Orders requiring the divestiture of stock pursuant to Neb. Rev. Stat. § 8-1513(4).

003.02 Ex parte communication means an oral or written communication which is not on the record in a contested case with respect to which reasonable notice to all parties was not given. Ex parte communication shall not include:

003.02A Communications which do not pertain to the merits of a contested case.

003.02B Communications required for the disposition of ex parte matters as authorized by law.

003.02C Communications in a rulemaking proceeding.

003.02D Communications to which all parties have given consent; and

003.03E Communications between the hearing officer and the Director which occur following the close of the hearing.

003.03 Party means each person or agency named or admitted as a party, or properly seeking and entitled as of right to be admitted as a party, and as defined in the Nebraska Rules of Civil Procedure, Neb. Rev. Stat. §§ 25-801 to 25-856, and shall include the Department.

003.04 Pleading shall have the same meaning as set forth in the Nebraska Rules of Civil Procedure, Neb. Rev. Stat. §§ 25-801 to 25-856.

003.05 Petition means the initial document filed by or with the Department that sets forth a claim and request for action by the Department.

004 PROHIBITIONS AGAINST EX PARTE COMMUNICATIONS.

004.01 Prohibitions; when applicable. The prohibitions found in this Section shall apply beginning at the time notice for hearing is given.

004.02 Prohibitions; to whom applicable.

004.02A Parties and public. A party in a contested case, a non-party participant, or any other person outside the Department having an interest in the contested case shall not make or knowingly cause to be made an ex parte communication to the hearing officer or to the Director or any Department employee who is or may reasonably be expected to be involved in the decision making process of the contested case.

004.02B Persons in decision making roles. A hearing officer or the Director or any Department employee who is, or may reasonably be expected to be, involved in the decision making process of the contested case shall not make or knowingly cause to be made an ex parte communication to any party in a contested case, a non-party participant, or other person outside the Department having an interest in the contested case.

004.02C Investigators. A Department employee engaged in the investigation or enforcement of a contested case shall not make or knowingly cause to be made an ex parte communication to a hearing officer or the Director or any Department employee who is or may reasonably be expected to be involved in the decision making process of the contested case.

004.03 Disclosure of contacts. The hearing officer or Director or any Department employee who is or may reasonably be expected to be involved in the decision making process of the contested case who receives or who makes or knowingly causes to be made an ex parte communication set forth in Sections 004.02A through 004.02C of this Rule shall file in the record of the contested case:

004.03A All such written communications.

004.03B Memoranda stating the substance of all such oral communications.

004.03C All written responses and memoranda stating the substance of all oral responses to all the ex parte communications.

004.04 Filing of notice. The disclosure required in Section 004.03 of this Rule shall be filed within two business days of the receipt or making of the ex parte communication. Notice of the filing, with an opportunity to respond, shall be given to all interested parties, including all parties of record and all non-party participants in the contested case.

004.04A The hearing officer shall determine the method by which recipients shall respond to such notice and the time frame in which any response must be filed with the Department.

004.04B Compliance with the provisions of Section 004.03 of this Rule shall not alter or correct the nature of the original communication for purposes of the definition of ex parte communication.

004.05 The prohibitions and filing requirements established by this Section shall not apply to the Director in any case for which the Director has in writing recused himself or herself from participation in the decision-making process.

005 COMMENCEMENT OF A CONTESTED CASE.

005.01 The parties to a contested case shall be the Department and the person or persons against whom a contested case is brought (“Respondent”).

005.02 The contested case begins with the filing of a complaint by the Department or a request for hearing by a party with the Department.

005.02A The complaint is the initial document filed by the Department and shall set forth the specific facts of the alleged violation and the administrative sanctions sought to be imposed by the Department action. A complaint may be styled as an order to a particular person to show cause why the Department should not take a specified action.

005.02B A request for a hearing shall include any pleading filed which seeks review of the appropriateness of an order issued by the Department.

005.02C The Department shall serve a copy of the complaint on each Respondent listed in the petition personally or by first-class or certified mail. Written proof of such service shall be filed in the official record.

005.02D If the complaint does not include a notice of hearing, any Respondent to a complaint may request a hearing as provided by statute under which the complaint was filed. For all other complaints, a Respondent who chooses to file a responsive pleading must do so within 20 days from the date of personal service or the date of the mailing of the complaint by the Department.

005.02E Amendments.

005.02E1 A complaint may be amended at any time before a responsive pleading is filed or is due if notice is given to the Respondent or his or her attorney of record. In all other cases, a petitioner must request permission to amend from the hearing officer.

005.02E2 A hearing officer may also allow, in his or her discretion, the filing of supplemental pleadings alleging facts material to the case occurring after the original pleadings were filed. A hearing officer may also permit amendment of pleadings where a mistake appears or where amendment does not materially change a claim or defense.

005.03 The pleadings in a contested case may include a complaint, petition, answer, reply, notice, motion, stipulation, objection or order or other formal written document filed in a proceeding before the Department. Any pleading filed in a contested case shall meet the following requirements:

005.03A The pleading shall contain a heading specifying the name of the Department and the title or nature of the pleading.

005.03B The pleading shall state material factual allegations and state concisely the action the Department is being requested to take.

005.03C The pleading shall contain the name and address of the petitioner.

005.03D The pleading shall be manually signed by the party filing the pleading or, when represented by an attorney, by that attorney.

005.03D1 An attorney representing a party before the Department shall also include his or her address, telephone number, e-mail address, if applicable, and Nebraska bar number on all pleadings filed with the Department.

005.03D2 The initial complaint shall also contain the name and address of the Respondent.

005.03E All pleadings shall be made on white, letter-sized paper (8½ inches x 11 inches) of standard weight. All pleadings must be legible and may be typewritten, printed or handwritten, or on a form photo statically reproduced. If handwritten, a pleading must be written in ink.

005.03F All pleadings shall be filed with the Department at its main office. Filing may be accomplished by personal delivery or mail and will be received during regular office hours of the Department.

005.03G Copies of all pleadings filed with the Department subsequent to the initial petition shall be served by the party filing such pleading upon all attorneys of record or other representatives of record and upon all unrepresented parties. Service shall be made personally or by first-class or certified mail. Written proof of such service shall be filed with the Department.

005.04 Unless state law provides that a hearing is not required, a hearing date shall be set by the Director or hearing officer in accordance with statutory requirements. A written notice of the time and place of hearing and the name of the hearing officer, if known, shall be served by the Department upon all attorneys of record or other representatives of record and upon all unrepresented parties. The notice must include a proof of such service and be filed in the official record.

005.04A In determining the necessary parties to receive notice in a contested case, the Director or hearing officer shall consider (a) the person or persons alleged to have violated applicable laws, rules, regulations or orders; (b) persons standing in a fiduciary and/or official capacity with the person affected by the alleged violation; (c) persons who may have aided in the alleged violation; and (d) any other persons who may have knowledge of the alleged violation.

005.04B Failure to file notice as required by this Rule will invalidate any action of the Director only if such failure to give notice is raised by the alleged violator and only if the substantial rights of one of the parties are prejudiced.

005.04C Participation in the hearing shall be deemed a waiver of any notice requirement.

005.05 The Director may order two or more proceedings which are legally or factually related to be heard and considered together on a consolidated record, unless any party thereto makes a showing, sufficient to satisfy the Director, that it would be prejudiced thereby.

006 INTERVENTION IN A CONTESTED CASE.

006.01 Intervention in a contested case shall be allowed when the following requirements are met:

006.01A A petition for intervention must be submitted in writing to the Department at least five days before the hearing. Copies must be mailed by the petitioner for intervention to all parties named in the notice of the hearing. Such petition shall comply with the general provisions relating to pleadings set forth in Section 005.03 of this Rule.

006.01B The petition must state facts demonstrating that the petitioner’s legal rights, duties, privileges, immunities, or other legal interests may be substantially affected by the proceeding or that the petitioner qualifies as an intervenor under any provision of law, state with particularity the position of the petitioner for intervention on the matters to be considered at the hearing, and identify any other person whom the petitioner for intervention represents.

006.01C The hearing officer or Director must determine that the interests of justice and the orderly and prompt conduct of the proceedings will not be impaired by allowing the intervention.

006.02 The Director or hearing officer may grant a petition for intervention at any time upon determining that the intervention sought is in the interests of justice and will not impair the orderly and prompt conduct of the proceedings.

006.03 If a petitioner qualifies for intervention, the hearing officer or Director may impose conditions upon the intervenor’s participation in the proceedings, either at the time that intervention is granted or at any subsequent time. Those conditions may include, but are not limited to:

006.03A Limiting the intervenor’s participation to designated issues in which the intervenor has a particular interest demonstrated by the petition;

006.03B Limiting the intervenor’s use of discovery, cross-examination, and other procedures so as to promote the orderly and prompt conduct of the proceedings; and

006.03C Requiring two or more intervenors to combine their presentation of evidence and argument, cross-examination, discovery, and other participation in the proceedings.

006.04 The Director or hearing officer, at least 24 hours before the hearing, shall issue an order granting or denying each pending petition for intervention, specifying any conditions and briefly stating the reasons for the order.

006.04A The Director or hearing officer may modify the order at any time, stating the reasons for the modification.

006.04B The Director or hearing officer shall promptly give notice of an order granting, denying, or modifying intervention to the petitioner for intervention and to all parties.

006.05 The Director or hearing officer may grant a petition for intervention filed less than five days prior to the hearing, under the following conditions:

006.05A The Director or hearing officer finds that extraordinary circumstances justify granting the petition.

006.05B The petitioner agrees to be bound by all agreements, arrangements and other matters previously made in the proceedings.

006.05C The petition for intervention raises issues which are pertinent to, but which do not unreasonably broaden, the issues already presented in the matter.

006.05D No party to the contested case will be unfairly prejudiced by the granting of the intervention.

006.06 Non-Party Participants at Hearings.

006.06A Any person who does not wish to be made a party or is otherwise not admitted as a party to a hearing and who desires to make an oral statement at the hearing may be permitted to do so provided that he or she:

006.06A1 Appears for himself or herself, or as a spokesperson for other interested people;

006.06A2 Is first duly sworn, the same as a regular witness; and

006.06A3 Is subject to examination by the formal parties to the hearing.

006.06B The Director or hearing officer shall determine when the non-party participant will be allowed to present his or her statement during the hearing and may set a limit on the length of such statement.

006.06C The Director or hearing officer shall have full discretion in determining the relevancy and materiality of such testimony.

006.06D At the conclusion of the case, the Director or hearing officer shall give such credence to testimony of non-party participants as he or she in his or her discretion determines warranted, considering all other evidence formally presented.

007 HEARING OFFICER; CRITERIA.

007.01 The Director may delegate to a hearing officer other than the Director the functions of conducting a prehearing conference and/or a hearing and submitting a recommended decision to the Director.

007.02 A person who has served as investigator, witness, or prosecutor in a contested case or in its prehearing stage may not serve as hearing officer or assist or advise a hearing officer in the same proceeding except as provided in Section 007.04 of this Rule.

007.03 A person who is subject to the authority, direction, or discretion of a person who has served as investigator, witness or prosecutor in a contested case or in its prehearing stage may not serve as hearing officer or advise a hearing officer in the same proceeding except as provided in Section 007.04 of this Rule.

007.04 If all parties consent, a person who has served as, or who is subject to the authority, direction, or discretion of a person who has served as investigator, witness or prosecutor in a contested case or in its prehearing stage may assist a hearing officer in the preparation of orders.

007.05 A person who has participated in a determination of probable cause or other equivalent preliminary determination in a contested case may serve as hearing officer or assist or advise a hearing officer in the same proceeding.

007.06 A person may serve as hearing officer at successive stages of the same contested case.

008 PREHEARING PROCEDURES.

008.01 Prehearing conferences and orders. A hearing officer designated to conduct a hearing may determine, subject to the Department’s rules and regulations, whether a prehearing conference will be conducted. If a prehearing conference is not held, the hearing officer may issue a prehearing order, based on the pleadings, to regulate the conduct of the proceedings.

008.01A If a prehearing conference is to be conducted:

008.01A1 The hearing officer shall promptly notify the Director of the determination that a prehearing conference will be conducted. The Director may assign another hearing officer for the prehearing conference.

008.01A2 The hearing officer for the prehearing conference shall set the time and place of the conference and give reasonable written notice to all parties, to all persons who have filed written petitions to intervene and to all non-party participants in the matter.

008.01A3 The notice referred to in Section 008.01A2 of this Rule shall include the following:

008.01A3(a) The names and mailing addresses of all parties and other persons to whom notice is being given by the hearing officer;

008.01A3(b) The name, official title, mailing address, and telephone number of the attorney who has been designated to appear for the Department;

008.01A3(c) The name of the proceeding, and a general description of the subject matter;

008.01A3(d) A statement of the time, place, and nature of the prehearing conference;

008.01A3(e) A statement of the legal authority and jurisdiction under which the prehearing conference and the hearing are to be held;

008.01A3(f) A statement that a party who fails to attend or participate in a prehearing conference, hearing, or other stage of a contested case or who fails to make a good faith effort to comply with a prehearing order may be held in default under the APA; and

008.01A3(g) Any other matters that the hearing officer considers desirable to expedite the proceedings.

008.01B The hearing officer shall conduct a prehearing conference, as may be appropriate, to deal with such matters as exploration of settlement possibilities, preparation of stipulations, clarification of issues, rulings on identity and limitation of the number of witnesses, objections to proffers of evidence, determination of the extent to which direct evidence, rebuttal evidence, or cross-examination will be presented in written form and the extent to which telephone, television, or other electronic means will be used as a substitute for proceedings in person, order of presentation of evidence and cross-examination, rulings regarding issuance of subpoenas, discovery orders, and protective orders, and such other matters as will promote the orderly and prompt conduct of the hearing.

008.01B1 The hearing officer shall issue a prehearing order incorporating the matters determined at the prehearing conference.

008.01B2 The hearing officer may, if there is not sufficient time for adequate written notice to the parties prior to the hearing, provide oral notice to the participants at the close of the pre-hearing conference of the matters determined at the pre-hearing conference. Such oral notice shall be made on the record, if the pre-hearing conference is recorded.

008.01C The hearing officer may conduct all or part of the prehearing conference by telephone, television, or other electronic means if each participant in the conference has an opportunity to participate in the entire proceeding while it is taking place.

008.02 Discovery in contested cases.

008.02A The hearing officer or a designee, at the request of any party or upon the hearing officer’s own motion, may issue subpoenas, discovery orders, and protective orders in accordance with the Nebraska Rules of Civil Procedure except as may otherwise be prescribed by law. Subpoenas and orders issued under this Section may be enforced by the District Court of Lancaster County, Nebraska.

008.02B Any prehearing motion to compel discovery, motion to quash, motion for protective order or other discovery-related motion shall:

008.02B1 Quote the interrogatory, request, question, or subpoena at issue, or be accompanied by a copy of the interrogatory, request, subpoena or excerpt of a deposition;

008.02B2 State the reasons supporting the motion;

008.02B3 Be accompanied by a statement setting forth the steps or efforts made by the moving party or his or her counsel to resolve by agreement the issues raised and that agreement has not been achieved; and

008.02B4 Be filed with the Department. The moving party must serve copies of all such motions upon all parties, or their attorneys of record.

008.02C Other than as provided in Section 008.02B4 of this Rule, discovery materials need not be filed with the Department.

008.03 Continuances. The hearing officer may, in his or her discretion, grant extensions of time or continuances of hearings upon the hearing officer’s own motion or at the timely request of any party for good cause shown.

008.03A Good cause. Good cause for an extension of time or continuance may include, but is not limited to, the following:

008.03A1 Illness of the hearing officer, party, attorney or witness;

008.03A2 A change in legal representation; or

008.03A3 On-going settlement negotiations.

008.03B A party must file a written motion for continuance which states in detail the reasons why a continuance is necessary and serve a copy of the motion on all other parties.

008.03C Any party requesting a continuance may be required to submit affidavits in support of such request.

008.03D Only under exceptional circumstances will a request for continuance of a hearing be considered unless submitted on or before the seventh day prior to the hearing date.

008.04 Submission of Exhibits and List of Witnesses.

008.04A At least ten days prior to the date of the hearing, all parties to the proceeding shall file with the Director or hearing officer a list of all witnesses who will appear to testify at the hearing. This list shall include all relevant information on witnesses' background, along with witnesses' qualifications to testify. Each party shall serve such a list on each other party to the proceeding or its attorneys.

008.04B At least ten days prior to the date of the hearing, each party to the proceeding shall file with the Director or hearing officer a copy of each exhibit to be introduced at the hearing.

008.04B1 A copy of each exhibit shall also be served on each other party to the proceeding, or its attorneys, at least ten days prior to the date of the hearing.

008.04B2 Rebuttal exhibits shall be limited to those solely in rebuttal to testimony or exhibits introduced at the hearing and need not be submitted or produced until offered.

008.05 The Director or hearing officer may accept the late filing of materials enumerated under this section for good cause shown. For purposes of this Section, good cause shall have the same meaning as is set forth in Section 008.03A of this Rule.

008.06 If a continuance of the hearing is granted under Section 008.03 of this Rule, the time frame for submitting material under this Section shall be set by the hearing officer.

008.07 Informal Disposition. Unless otherwise precluded by law, informal disposition may be made of any contested case by stipulation, agreed settlement, consent order, or default.

008.08 Summary Proceedings.

008.08A Whenever the Director believes by reason of substantial evidence that an emergency exists requiring immediate action to protect the safety and soundness of financial institutions in this state, as defined in Neb. Rev. Stat. § 8-101, he or she may issue a summary order pursuant to Neb. Rev. Stat. §§ 8-1,134 through 8-1,139 to abate such practices.

008.08B The alleged violator or violators may request a hearing following the issuance of a summary order, which hearing shall be conducted as set forth in this Rule, with the right of appeal pursuant to the APA.

009 CONDUCTING A CONTESTED CASE HEARING.

009.01 Official Record. All hearings before the Department in contested cases shall be recorded by a court reporter of the Department’s selection, unless otherwise agreed to by all the parties.

009.02 Order. Unless special circumstances exist, as determined at the discretion of the hearing officer, the hearing shall be conducted in the following order:

009.02A The hearing is called to order by the hearing officer, and any preliminary motions, stipulations or agreed orders shall be considered after the hearing is called to order.

009.02B Each party is permitted to make an opening statement. Opening statements shall take place in the same order as the presentation of evidence.

009.02C Presentation of evidence.

009.02C1 Evidence will be received in the following order:

009.02C1(a) Evidence is presented by the Department.

009.02C1(b) Evidence is presented by the Respondent or, if multiple Respondents, by each Respondent in the order in which responsive pleadings were filed.

009.02C1(c) Rebuttal evidence is presented by the Department.

009.02C1(d) Surrebuttal evidence is presented by the Respondent or Respondents, in the same order as evidence was presented.

009.02C1(e) Summary motions may be made by any party at the close of each party’s presentation or at the close of the presentation of all evidence.

009.02C1(f) The hearing officer shall determine the time at which non-party participants are allowed to make a statement on the record.

009.02C2 With regard to each witness who testifies, the following examination may be conducted:

009.02C2(a) Direct examination conducted by the party who calls the witness;

009.02C2(b) Cross-examination by the opposing party or parties, in the order established by the hearing officer;

009.02C2(c) Redirect examination by the party who called the witness; and

009.02C2(d) Recross-examination by the opposing party or parties.

009.02D After the evidence is presented, each party shall have opportunity to make a closing argument. Closing arguments shall be made in the same order as the presentation of evidence. The hearing officer may request that the parties submit briefs in lieu of closing arguments.

009.02E Post-Hearing Submissions.

009.02E1 Submission of briefs may be required, or permitted at the request of a party by the Director or the hearing officer. The time in which briefs shall be filed and the number of copies required will be fixed at the close of the hearing by the Director or the hearing officer. Briefs submitted to the Department shall be on white paper, 8 ½ inches x 11 inches, with margins of at least 1 inch on all sides, and shall be double spaced. No brief shall be longer than 25 pages. The Department will not consider any portion of the brief which exceeds the page limitation.

009.02E2 The hearing officer may request the parties submit proposed findings of fact and conclusions of law in lieu of, or in addition to, briefs pursuant to Section 009.02E1 of this Rule. The hearing officer shall establish the time schedule for such filing and any other restrictions that he or she deems appropriate under the circumstances.

009.03 Evidence .

009.03A In contested cases the Director or hearing officer may admit and give probative effect to evidence which possesses probative value commonly accepted by reasonably prudent persons in the conduct of their affairs and may exclude incompetent, irrelevant, immaterial and unduly cumulative or repetitious evidence.

009.03B Any party to a formal hearing before the Department, from which a decision may be appealed, may request that the parties be bound by the rules of evidence applicable in district court by delivering to the Department at least three days prior to the holding of the hearing a written request therefore. Such request shall include the requesting party’s agreement to be liable for the payment of costs incurred thereby and upon any appeal or review thereof.

009.03C Documentary evidence may be received in the form of copies or excerpts or incorporated by reference.

009.03C1 Parties shall furnish accurate copies of all documentary evidence offered at the hearing for the official record, to the Director or hearing officer, and all parties to the proceeding.

009.03C2 When documents are numerous, such as bank records or negotiable instruments, the Director or hearing officer may refuse to receive in evidence more than a limited number appearing to be representative. The party will be required to abstract in orderly fashion the relevant data from these documents, affording other parties reasonable opportunity to examine both the documents and the abstract, and thereupon offer the abstract in evidence in exhibit form.

009.03C3 Relevant portions of books, papers or documents shall be plainly designated and distinguished from all irrelevant portions before the relevant material may be offered into evidence. Where the irrelevant material in the book, paper or document is voluminous so as to encumber the record, the book, paper or document may be marked for identification and the relevant material read into the record. Upon direction of the Director or hearing officer, a true copy of the relevant matter may be received as an exhibit, provided that copies are delivered to all parties of record and provided all parties of record are afforded an opportunity to examine the book, paper or document and to offer in evidence in like manner other portions thereof, if found to be material and relevant.

009.03C4 All of the exhibits introduced in evidence shall be confined to a maximum size of 8 1/2 inches x 11 inches or be placed upon paper which may be folded to such size.

009.03C4(a) Enlarged charts of exhibits may be utilized at the hearing but the exhibit to be made a part of the record shall be of such size as heretofore stated.

009.03C5 Exhibits may be sealed upon a determination by the hearing officer that the exhibit contains information which is confidential in nature and which, if made public, could harm any person.

009.03D All evidence including records and documents in the possession of the Department of which it desires to avail itself shall be offered and made a part of the record in the case. No factual information or evidence other than the record shall be considered in the determination of the case.

009.03D1 Any party desiring to introduce into evidence any part or parts of official files shall obtain certified copies thereof from the Department in advance of the hearing.

009.03E A hearing officer may administer oaths and issue subpoenas in accordance with the Nebraska Rules of Civil Procedure except as may otherwise be prescribed by law. Subpoenas and orders issued under this subsection may be enforced by the District Court of Lancaster County, Nebraska.

009.03F The Department shall give effect to the rules of privilege recognized by law.

009.03G The hearing officer may take administrative notice of cognizable facts and in addition may take administrative notice of general, technical, or scientific facts within its specialized knowledge and the rules and regulations adopted and promulgated by the Department.

009.03G1 Parties shall be notified either before or during the hearing or by reference in preliminary reports or otherwise of materials so noticed.

009.03G2 Parties shall be afforded an opportunity to contest facts so noticed.

009.03G3 The record shall contain a written record of every fact or item administratively noticed.

009.03H The Department may utilize its experience, technical competence and specialized knowledge in the evaluation of the evidence presented to it.

009.03I Parties to any proceeding may agree upon any facts involved in the controversy, either by written stipulation entered into the record as an exhibit, or by oral agreement stated on the record; provided, that the Director or hearing officer shall not be irrevocably bound by such stipulation.

009.03J During any proceedings, the Director or hearing officer may request any party to furnish and serve designated late-filed exhibits. Such exhibits shall be filed within such time as specified by the Director or hearing officer.

009.03K The Director or any person or persons designated by the Director may make such investigations as deemed necessary to assist in the determination of matters pending before the Department. Any finding or exhibits resulting from such investigation which the Director uses in making a decision will be included and become a part of the evidence of such pending matter.

009.04 Witnesses.

009.04A The Director, hearing officer, or any person designated by the hearing officer shall administer an oath to all witnesses providing testimony in a contested case prior to their testimony.

009.04B The Director or hearing officer, upon a showing of cause, may grant a motion by any party to sequester witnesses, except that:

009.04B1 Any individual who is a Respondent in a contested case shall not be sequestered; and

00904.B2 Every party to a contested case may select one representative to assist its counsel during the hearing. Such representative, even if designated as a witness, shall not be sequestered.

009.04C Every party to a contested case shall have the right to cross-examine each witness who testifies at a hearing. Where it appears that the cross-examination by one party will protect the rights of all parties similarly situated, the hearing officer may limit cross-examination to one party on either side of an issue.

009.04D A subpoena requiring the attendance of a witness shall be issued by the Director or hearing officer, on good cause shown, for the purpose of taking evidence or compelling the production of any papers, books, accounts, and documents which are relevant and material to the hearing.

009.04D1 A party directed to produce accounts, books, documents, or papers shall furnish and deliver the same at the time and place to the person specified in the subpoena.

009.04D2 A subpoena issued pursuant to this Rule may be served in any manner permitted by law including service by certified or registered mail, return receipt requested.

009.04D3 In the case of disobedience of a subpoena, the Director may invoke the aid of the applicable District Court in requiring the attendance and testimony of witnesses and in the production of accounts, books, documents, or papers.

009.04D4 Charges for serving a subpoena are to be paid prior to the date set for hearing by the party at whose instance the subpoena is issued.

009.04E Any witness who is subpoenaed and who responds thereto is entitled to the same fee as is paid for like service in the District Courts of Nebraska. Such fee is to be paid by the party at whose instance the witness's testimony is to be taken.

009.05 Appearances. Any party may appear in his or her own behalf at the hearing. An individual may appear on behalf of a party only if he or she:

009.05A Is admitted to practice law before the Nebraska Supreme Court; or

009.05B Is admitted to and engaged in the practice of law in the courts of record of another state, the District of Columbia, or a territory of the United States, and has associated with and is appearing with an attorney who is a resident of Nebraska, duly and regularly admitted to practice in the courts of record of this state, and upon whom service may be had in all matters connected with the action with the same force and effect as if personally made on such foreign attorney within this state, upon the filing of an appropriate pro hac vice motion with the Department.

009.06 Conducting the hearing by electronic means. The hearing officer may conduct all or part of the hearing by telephone, television, or other electronic means if each participant in the hearing has an opportunity to participate in the entire proceeding while it is taking place.

009.07 Official record.

009.07A The Department shall prepare an official record, which shall include testimony and exhibits, in each contested case, but it shall not be necessary to transcribe the record of the proceedings unless requested for purpose of rehearing or appeal, in which event the transcript and record shall be furnished by the Department upon request and tender of the cost of preparation.

009.07B The Department shall maintain an official record of each contested case under the APA for at least four years following the date of the final order.

009.07C The Department record shall consist only of the following:

009.07C1 Notices of all proceedings;

009.07C2 Any pleadings, motions, requests, preliminary or intermediate rulings and orders, and similar correspondence to or from the Department pertaining to the contested case;

009.07C3 The record of the hearing before the Department, including all exhibits and evidence introduced during such hearing, a statement of matters administratively noticed by the Department during the proceeding, and all proffers of proof and objections and rulings thereon;

009.07C4 Any filing requirement pursuant to Section 004.03 of this Rule;

009.07C5 The recommended order of the hearing officer; and

009.07C6 The final order.

009.07D Except to the extent that the APA or another statute provides otherwise, the Department record shall constitute the exclusive basis for Department action in contested cases under the APA and for judicial review thereof.

009.07E If the hearing is closed to the public as set forth in Section 009.09 of this Rule, the entire record shall be a non-public record pursuant to Neb. Rev. Stat. § 84-712.05(5).

009.08 Costs. Except as provided in Section 009.04D of this Rule, all costs of a formal hearing, including, but not limited to, court reporter fees and fees for the Director and hearing officer's time shall be paid by the party or parties against whom a final decision is rendered, unless the hearing officer or Director determines that another allocation is appropriate.

009.09 Non-Public Hearing.

009.09A Hearings subject to the provisions of this Rule shall be open to the public unless the Director specifically determines that circumstances warrant closing of the hearing to the public. Such circumstances shall include, but shall not be limited to:

009.09A1 Allegations involving criminal misconduct are the subject of the hearing.

009.09A2 Confidential financial information from an institution regulated by the Department is likely to be disclosed at the hearing.

009.09A3 The reputation of an individual could be needlessly injured.

009.09A4 The financial condition of an institution regulated by the Department could be needlessly injured.

009.09A5 The public interest would be protected.

009.09B If the Director determines that the hearing will be closed to the public, notice of that fact shall be served upon the parties to the hearing at the time notice of the hearing itself is served.

009.09B1 Upon motion by any party to the hearing, the Director shall reconsider the determination that the hearing will be closed to the public. Such motion shall be filed with the Department at least five (5) days prior to the date of the hearing.

009.09B2 If the notice of hearing does not specify that the hearing is to be closed to the public, any party may request that the hearing be closed pursuant to this Rule. Any such request must specify the reason for closing the hearing and must be submitted to the Director at least ten (10) days prior to the hearing. The party requesting the closing of the hearing shall serve a copy of the request on all parties or their attorneys of record.

010 DECISION AND ORDER IN A CONTESTED CASE.

010.01 Every decision and order adverse to a party to the proceeding, rendered by the Department in a contested case, shall be in writing or stated in the record and, if in writing, shall be accompanied by findings of fact and conclusions of law.

010.02 The decision and order should include:

010.02A The name of the Department and name of the proceeding.

010.02B The time and place of the hearing.

010.02C The names of all parties or their attorneys who entered an appearance at the hearing and all non-party participants.

010.02D The findings of fact consisting of a concise statement of the finding with regarding to each contested issue of material fact.

010.02E The conclusions of law consisting of the application of the controlling law to the facts found and the legal results arising therefrom.

010.02F The order consisting of the action taken by the Department as a result of the facts found and the legal conclusions arising therefrom.

010.02G The hearing officer shall submit a recommended order which complies with the provisions of this Section to the Director. The Director may adopt the recommended order without a separate order. The Director may accept or reject in whole or in part the recommended order.

010.03 A copy of the decision and order and accompanying findings and conclusions shall be delivered or mailed to each party or his, her, or its attorney of record.

010.04 In all contested cases arising under Neb. Rev. Stat. §§ 8-1,134 through 8-1,139, proposed findings of fact and conclusions of law shall be delivered or mailed to the interested parties prior to entering any order on the record.

010.04A Within five (5) days of receipt of such findings of fact and conclusions of law, any interested party may submit exceptions to the findings or conclusions, with supporting reasons for such exceptions, to the Director.

010.04B The Director shall enter a final order or decision, and as part thereof may adopt or reject in whole or in part the findings of fact and conclusions of law of the hearing officer, based upon any exceptions filed by the parties or upon his or her own analysis of the evidence presented at the hearing.

011 APPEALS.

011.01 Any person aggrieved by a final decision in a contested case is entitled to judicial review under the APA or to resort to such other means of review as may be provided by law.

011.02 Parties desiring to appeal an order of the Department rendered pursuant to the APA must file a petition for review in the District Court of Lancaster County, Nebraska, within thirty (30) days after the service of the final decision by the Department. The thirty day period for appeal commences to run from the date of mailing of the notice of order and decision to the parties or their attorneys of record. Service of the petition and summons must be made in accordance with Nebraska law.

011.03 The APA governs the procedure for taking an appeal.

012 LIBERAL CONSTRUCTION. This rule shall be liberally construed to secure a just, speedy and inexpensive determination of the issues presented in any contested case.

History

• Effective 2002-08-20

Chapter 5 Rule of Procedure for Declaratory Actions

Neb. Admin. Code tit. 49, ch. 5 Rule of Procedure for Declaratory Actions {#sec-49-nac-5 omnilex-key=us-ne-regs-official--title-49--49 NAC 5}

001 GENERAL .

001.01 This Rule has been promulgated pursuant to authority delegated to the Director in Section 84-912.01 of the APA.

001.02 This Rule sets forth the procedures to be used by any person seeking issuance of a declaratory order by the Department.

001.03 The Department has determined that this Rule is in the public interest.

001.04 The definitions in 49 NAC 1.002 shall apply to the provisions of this Rule, unless otherwise specified.

002 DEFINITIONS . For purposes of this Rule, the following additional definitions shall apply:

002.01 Argument means the oral or written statement of the petitioner or any other party which explains his or her view of the facts and issue(s) to be decided, the law applicable to the question(s) presented, and the reasoning that connects the facts and law.

002.02 Contested case means a proceeding before the Department in which the legal rights, duties, or privileges of specific parties are required by law or constitutional right to be determined after hearing before the Department.

002.03 Declaratory order proceeding means a proceeding initiated by a petitioner seeking issuance of a binding order by the Department as to the applicability of specified circumstances to a statute, rule, or order within the primary jurisdiction of the Department.

002.04 Intervenor means any person who has or claims to have any interest, legal right, duty, privilege, or immunity which would be directly affected by the Department’s issuance of a binding declaratory order.

002.05 Necessary party means a person who has a specific interest in the applicability of the statute, rule, or order under consideration, as distinguished from a general interest such as may be the concern of the public at large. A necessary party is one which is or would be adversely affected in a legally cognizable way by the uncertainty sought to be resolved.

002.06 Party means any person subject to the jurisdiction of the Department who is involved in a declaratory order proceeding according to the procedures set forth in this Rule.

002.07 Petition means the document filed in accordance with Section 003 of this Rule to initiate a declaratory order proceeding.

002.08 Petitioner(s) means the party or parties who have filed a petition with the Department seeking issuance of a declaratory order.

002.09 Pleading means any written petition, answer, or motion used in any declaratory order proceeding before the Department as set forth in this Rule.

003 PETITION FOR DECLARATORY ORDER .

003.01 Generally. A request for a declaratory order must be made by a petition that meets the requirements of this Section.

003.02 Who May File. Any person may petition the Department for the issuance of a declaratory order as to the applicability of a specific statute, rule, or order within the primary jurisdiction of the Department to the person’s specific circumstances.

003.03 When Orders Are Appropriate. A declaratory order may be requested on the applicability of a statute, rule, or order enforced by the Department. Applicability refers to the appropriateness of the relation of the law to the person, property, or state of facts, or its relevance under the circumstances given. It may include such questions as whether the law applies at all, to whom it applies, when it applies, how it applies, or which law applies. Considerations as to whether issuance of a declaratory order is appropriate include:

003.03A A declaratory order may be requested only on the applicability of existing statutes and rules or an outstanding order.

003.03B A declaratory order may be requested to obtain a determination of proposed conduct, not to obtain a determination of the effect of conduct that has already occurred.

003.03C A declaratory order is not a mechanism for review or appeal of a decision made by the Department in a contested case.

003.03D A declaratory order may not be requested to obtain a declaration by the Department that a statute or rule is unconstitutional or that a rule of the Department is invalid.

003.03E A declaratory order may not be issued by the Department that would substantially prejudice the rights of a person who would be a necessary party and who does not consent in writing to the determination of the matter by a declaratory order proceeding.

003.04 Form of Petition. A petition for declaratory order shall be in the form of either a pleading or letter which shall contain each of the following:

003.04A A caption, which shall include:

003.04A1 The venue: BEFORE THE DEPARTMENT OF BANKING AND FINANCE, STATE OF NEBRASKA;

003.04A2 A heading specifying the subject matter and the name of the petitioner; and

003.04A3 The name of the pleading: PETITION FOR DECLARATORY ORDER.

003.04B The statements required in Subsection 003.05 of this Rule.

003.04C The signature of the petitioner, or when represented by an attorney, the signature of the attorney.

003.04D The name and address of the petitioner, and when represented by an attorney, the name, address, telephone number, e-mail address if applicable, and Nebraska bar number of the attorney.

003.04E The petition shall be made on white, letter-sized paper (8 1/2 inches x 11 inches) of standard weight.

003.04F The petition must be legible, and may be typewritten, printed, or handwritten, or on a form photostatically reproduced. If handwritten, the petition must be written in ink. Only one side of a page shall contain any writing. Petitions must contain an original manual signature of the person requesting the declaratory order or an authorized agent of such person.

003.04G Any documents attached to a petition shall be securely fastened to the pleading and shall meet the requirements of Sections 003.04E and 003.04F and, when possible, be reproduced on white, letter-sized paper (8 1/2 inches x 11 inches) of standard weight or placed in a 9 inches x 12 inches envelope and clearly marked as an attachment to the petition.

003.05 Contents of Petition. To be considered, the petition shall include the following:

003.05A The name and address of the petitioner.

003.05B The name and address of all persons or entities, known to the petitioner, who may have a specific interest in the applicability of the statute, rule, or order or who may be adversely affected by the issue sought to be resolved by the petitioner.

003.05C The statute, rule, or order upon which the petitioner seeks issuance of a declaratory order.

003.05D A detailed statement of all of the material facts and specific circumstances which apply to petitioner’s request for issuance of a declaratory order.

003.05E All propositions of law or contentions asserted by the petitioner.

003.05F A demand for an interpretation to which the petitioner alleges entitlement. The petition shall state the petitioner’s position as to how the Department should rule and why the Department should rule in the manner requested.

003.05G Any documents pertinent to the petition that the petitioner wishes to be considered by the Department.

003.06 Verification. The petition shall be subscribed and verified by the petitioner. If the petitioner is a corporation, political subdivision, or other entity, then the petition shall be subscribed and verified by a duly authorized agent of the petitioning entity.

003.07 Sample Petition. The petitioner may use the sample form of a petition which is attached as Form 49-5-1 and incorporated herein by reference. The petitioner may also prepare a reasonable facsimile of Form 49-5-1 provided the requirements of Sections 003.04, 003.05, and 003.06 of this Rule are satisfied.

003.08 Written Consents. The petitioner shall attach to the petition any written consents obtained from any necessary party to the declaratory order proceeding.

004 SUBMISSION AND SERVICE OF DECLARATORY ORDER PETITION .

004.01 The original petition for declaratory order shall be filed with the Director by mail or in person during the Department’s normal business hours.

004.02 The petition shall be deemed as filed when it is actually received by the Department. The Department shall date stamp all petitions upon receipt.

004.03 Within five (5) days of the date that the petition is filed with the Department, the petitioner shall serve a copy of the petition, by certified mail, return receipt requested, on all necessary parties, including all persons who are known to have or claim any interest, legal right, duty, privilege, or immunity which would be directly affected by issuance of a declaratory order in this matter by the Department. The petitioner may request an alternative means of service if the petitioner can demonstrate that service by certified mail is not feasible and the requested alternative means of services has as great of a likelihood of notification of all necessary parties as certified mail.

004.03A The petitioner shall include a list of the names or categories of entities of all necessary parties to the declaratory action with the petition when filed with the Department. The Department may require the petitioner to notify additional parties if it determines the list has not identified all necessary parties.

004.03B The petitioner shall file with the Department proof of service on all necessary parties identified in the petition.

005 DISPOSITION OF THE PETITION .

005.01 Upon the filing of a petition, the Director may consider the petition, or delegate the matter to a designated hearing officer or Department representative to consider the petition and recommend a decision. In reviewing the petition, the Director or his or her designee may, in his or her discretion, do one or more of the following:

005.01A Require that additional information be submitted before the petition will be further considered;

005.01B Require a petitioner to provide notice to persons not previously notified that a request for a declaratory order has been filed with the Department;

005.01C Schedule a date, time, and location at which the petitioner and any other parties to the proceeding may make an oral presentation on the petition; or

005.01D Consider the petition and any attachments without oral presentation.

005.02 Within thirty (30) days after the petition is filed, the Department shall, in writing:

005.02A Issue an order declaring the applicability of the statute, rule, or order in question to the specified circumstances; or

005.02B Agree to issue an order by a specified time declaring the applicability of the statute, rule, or order in question to the specified circumstances; or

005.02C Set the matter for specified proceedings as set forth in Section 005.01C of this Rule; or

005.02D Decline to issue a declaratory ruling, stating the reasons for the decision.

005.03 Notwithstanding Section 005.02 of this Rule, the Department may determine at any time that it will not issue a declaratory order if issuance of an order under the circumstances would be contrary to any provisions of Section 009 of this Rule. The Department shall notify the petitioner and, if applicable, any intervenor or necessary party of such decision.

006 INTERVENTION IN DECLARATORY ORDER PROCEEDING .

006.01 Intervention by any person in a declaratory order proceeding shall be allowed when the following requirements are met:

006.01A A petition for intervention is submitted in writing to the Department. Copies must be mailed to all parties to the proceeding.

006.01B The petition complies with the requirements set forth in Section 006.02.

006.01C The Department determines that the interests of justice and the orderly and prompt conduct of the proceedings will not be impaired by allowing the intervention.

006.02 The petition shall be made on white, letter-sized paper (8 1/2 inches x 11 inches) of standard weight.

006.03 The petition must be legible, and may be typewritten, printed, or handwritten or on a form photostatically reproduced. If handwritten, the petition must be written in ink. Only one side of a page shall contain any writing. Petitions must contain an original manual signature of the person requesting intervention in the declaratory action or an authorized agent of such person.

006.04 The petition for intervention shall be submitted to the Department and shall include each of the following:

006.04A The name and address of the intervenor; and when represented by an attorney, the name, address, telephone number, e-mail address if applicable, and Nebraska bar number of the attorney.

006.04B The statute, rule, or order that may apply to or affect the person, property, entity, or facts at issue in the matter.

006.04C A statement of facts sufficient to show the intervenor’s interest.

006.04D A statement of facts which demonstrate that the intervenor’s legal rights, duties, privileges, immunities, or other legal interests may be substantially affected by the proceeding or that the intervenor may intervene pursuant to a provision of law.

006.04E All propositions of law or contentions asserted by the intervenor;

006.04F A statement of the specific relief requested by the intervenor.

006.04G A demand for the relief to which the intervenor alleges entitlement. The petition shall state the intervenor’s position as to how the Department should rule and why the Department should rule in the manner requested.

006.04H Any documents pertinent to the petition that the intervenor wishes to be considered by the Department.

006.04I The signature of the intervenor, or when represented by an attorney, the signature of the attorney.

006.04J The petition shall be subscribed and verified by the intervenor. If the intervenor is a corporation, political subdivision, or other entity, then the petition shall be subscribed and verified by a duly authorized agent of the intervening entity.

006.05 The Department may, at its discretion, invite any person or entity to file a petition for intervention.

006.06 The Department shall grant a petition for intervention if the requirements of Section 006.01 and Section 006.04 are satisfied.

006.07 The Department shall deny a petition for intervention upon determining that the interests of justice or the orderly and prompt conduct of the proceedings would be impaired by allowing the intervention.

006.08 The Department’s decision to grant or deny a petition for intervention shall be in writing and served upon all parties.

007 DECLARATORY ORDER PROCEEDINGS .

007.01 Oral argument shall be had only on specific order of the Department. A petitioner, intervenor, necessary party, or the Department may submit a motion for oral argument to the Director. If opportunity for oral argument is granted, then argument shall be scheduled to be conducted not more than thirty (30) days after filing of the petition for declaratory order. Petitioner and all other parties or, when represented, their attorneys, shall be served with a notice of the date, time, and location for oral argument. The Department shall provide each of the parties with notice of the proceeding not less than seven (7) days in advance of the scheduled date. Service shall be made by certified mail, return receipt requested. The Department may allocate the cost of holding oral argument among the parties participating in the declaratory action as it determines appropriate.

007.02 Oral argument will be made before a hearing officer or before any representative of the Department who is authorized to render or to recommend a decision to the Director. The hearing officer or Department representative shall be in control of the proceeding and shall:

007.02A Identify the proceeding and introduce himself or herself and identify each party for the record;

007.02B Hear the oral argument of the petitioner, intervenor, or necessary parties; and

007.02C Close the proceedings.

007.03 At the declaratory order proceeding, Department staff shall have the right to present oral argument.

007.04 The hearing officer or Department representative may impose reasonable time limits on the amount of time allocated to each party for oral argument.

007.05 The parties and Department staff may file briefs in support of their respective positions. The hearing officer may fix the time and order of filing briefs and may direct that briefs be submitted prior to the date of oral argument.

007.06 The oral argument may be conducted either in person or by telephone conference call.

007.07 The Department shall prepare an official record, which shall include testimony and exhibits, in each declaratory action.

007.07A It shall not be necessary to transcribe the record of the proceedings unless requested for purpose of rehearing or appeal, in which event the transcript and record shall be furnished by the Department upon request and tender of the cost of preparation.

007.07B The Department shall maintain an official record of each declaratory action under the APA for at least four years following the date of the final order.

008 ISSUANCE OF DECLARATORY ORDER .

008.01 The Department shall issue its order on the petition for declaratory relief within sixty (60) days of the date on which the petition was filed.

008.02 The order shall be in writing and shall include the following:

008.02A The names of all parties to the proceeding upon which the order is based;

008.02B The facts upon which the order is based;

008.02C The statute, rule, or order at issue in the matter;

008.02D The Department’s conclusion as to the applicability of the statute, rule, or order to the facts;

008.02E The Department’s conclusion as to the legal effect or result of applying the statute, rule, or order to the facts; and

008.02F The reasons relied upon by the Department to support its conclusions.

008.03 A copy of the order shall be served upon each party by certified mail, return receipt requested.

008.04 An order in a declaratory proceeding shall have the same status and binding effect as an order issued in a contested case.

008.05 If the Department has not issued an order on the petition for declaratory relief within sixty (60) days after the petition has been filed, the petition shall be deemed to have been denied by the Department.

009 CIRCUMSTANCES UNDER WHICH THE DEPARTMENT WILL NOT ISSUE DECLARATORY ORDERS .

009.01 Grounds upon which the Department shall refuse to issue a declaratory order include, but are not limited to, the following:

009.01A The petition requests a declaratory order on a matter that is outside the scope of authority of the Department;

009.01B The petition requests review of a decision made by the Department in a contested case;

009.01C The petition requests a declaratory order on the effect of past conduct;

009.01D An investigation for purposes of a formal adjudication, a contested case, or a petition to issue, amend, or repeal rules involving the petitioner on substantially the same or similar facts or issues raised in the petition is pending before the Department;

009.01E The petition seeks a declaration that a statute or rule is unconstitutional or invalid;

009.01F The issue raised in the petition has been settled by a change in circumstances or other means so as to render moot the need for a declaratory order;

009.01G An order would substantially prejudice the rights of a person who would be a necessary party and who does not consent in writing to the determination of the matter by a declaratory order proceeding;

009.01H An order would not resolve the controversy or uncertainty; or

009.01I The question posed or facts presented are not sufficiently specific, are overly broad, or are otherwise inappropriate as a basis upon which to decide the matter.

009.02 Grounds upon which the Department may determine to refuse to issue a declaratory order include, but are not limited to, the following:

009.02A Refusal is necessary to assure adequate allocation of Department resources are available for issuing rulings on petitions raising questions of greater urgency or significance;

009.02B The question presented is of such complexity that the Department has had insufficient opportunity or resources to develop a fully matured ruling; or

009.02C The petitioner fails to submit any additional information requested by the Department or submits such information after the date established by the Department;

010 APPEAL . An order on a petition for declaratory relief is subject to review in the manner provided for review of contested cases by the APA. Specific procedures for appeal are set forth in the APA.

Form 49-5-1

History

• Effective 2002-08-20

Chapter 6 Rule of Procedure for Negotiated Rulemaking

Neb. Admin. Code tit. 49, ch. 6 Rule of Procedure for Negotiated Rulemaking {#sec-49-nac-6 omnilex-key=us-ne-regs-official--title-49--49 NAC 6}

001 GENERAL .

001.01 This Rule has been promulgated pursuant to authority delegated to the Director of the Department in Section 84-919.01 of the APA.

001.02 The Department has determined that this Rule is in the public interest.

001.03 The definitions in 49 NAC 1.002 shall apply to the provisions of this Rule, unless otherwise specified.

002 NEGOTIATED RULEMAKING GENERALLY . This Rule establishes a framework for the conduct of negotiated rulemaking consistent with the APA and the Negotiated Rulemaking Act, Neb. Rev. Stat. §§ 84-921 to 84-932. Negotiated rulemaking is not a substitute for the requirements of the APA, but may be used as a supplemental procedure to development of new rules or the amendment or repeal of existing rules. The negotiated rulemaking process does not preclude other efforts or processes designed to reach consensus with affected or interested persons concerning the content of rules or regulations. A consensus agreement on a proposed rule reached by a negotiated rulemaking committee may be modified by the Department as a result of a subsequent formal rulemaking process.

003 DEFINITIONS . For purposes of this Rule, the following additional definitions shall apply:

003.01 Consensus means unanimous concurrence among the interests represented on a negotiated rulemaking committee unless the committee agrees upon another specified definition.

003.02 Convenor means a person who impartially assists the Department in determining whether establishment of a negotiated rulemaking committee is feasible and appropriate for a particular rulemaking procedure.

003.03 Facilitator means a person who impartially aids in the discussion and negotiations among the members of a negotiated rulemaking committee to develop a proposed rule. A facilitator shall not have decisionmaking authority.

003.04 Interest means, with respect to an issue or matter, multiple parties that have a similar point of view or that are likely to be affected in a similar manner.

003.05 Negotiated rulemaking means rulemaking through the use of a negotiated rulemaking committee.

003.06 Negotiated rulemaking committee means an advisory committee established to consider and discuss issues for the purpose of reaching a consensus in the development of a proposed rule.

003.07 Person means an individual, partnership, limited liability company, corporation, association, governmental subdivision, agency, or public or private organization of any character.

003.08 Rule or regulation means any rule, regulation, or standard issued by the Department, including the amendment or repeal thereof whether with or without prior hearing, and designed to implement, interpret, or make specific the law enforced or administered by it or governing its organization or procedure, but not including rules and regulations concerning the internal management of the Department not affecting private rights, private interests, or procedures available to the public and not including permits, certificates of public convenience and necessity, franchises, rate orders and rate tariffs, and any rules of interpretation thereof. For the purpose of this Rule, every rule and regulation which shall prescribe a penalty shall be presumed to have general applicability or to affect private rights and interests.

004 ESTABLISHMENT OF A NEGOTIATED RULEMAKING COMMITTEE; CRITERIA . The Department may establish a negotiated rulemaking committee to negotiate and develop a proposed rule if the Director determines that the use of the negotiated rulemaking procedure is in the public interest. In making that determination, the Director shall consider whether:

004.01 There is a need for the rule.

004.02 There are a limited number of identifiable interests that will be significantly affected by the rule.

004.03 There is a reasonable likelihood that a negotiated rulemaking committee can be convened with a balanced representation of the persons who:

004.03A Can adequately represent the interests identified; and

004.03B Are willing to negotiate in good faith to reach a consensus on the proposed rule.

004.04 There is a reasonable likelihood that a negotiated rulemaking committee will reach a consensus on the proposed rule within a fixed period of time.

004.05 The negotiated rulemaking procedure will not unreasonably delay the notice of proposed formal rulemaking and the issuance of the final rule pursuant to the APA.

004.06 The Department has adequate resources and is willing to commit those resources, including technical assistance, to the negotiated rulemaking committee.

004.07 The Department, to the maximum extent possible consistent with its legal obligations, will use the consensus of the negotiated rulemaking committee as the basis of the rule proposed in the formal rulemaking process of the APA.

005 CONVENORS; SELECTION; DUTIES . The Department, at the discretion of the Director, may use the services of a convenor.

005.01 The Department may employ or contract for an organization or an individual to serve as a convenor, or may use the services of a state employee to act as a convenor. A convenor shall not have a financial or other interest that would preclude him or her from serving in an impartial and independent manner. The Department shall determine whether a person under consideration as a convenor has such an interest. A person disqualified under this criterion shall be dropped from further consideration.

005.02 The convenor may assist the Department in making the determination of need for a negotiated rulemaking process discussed in Section 004 of this Rule. The convenor may also assist the Department in:

005.02A Identifying persons who will be significantly affected by a proposed rule; and

005.02B Conducting discussions with affected persons on the issues of concern and ascertaining whether the establishment of a negotiated rulemaking committee is feasible and appropriate for the particular rulemaking.

005.03 The convenor shall report findings and make recommendations to the Department. Upon request of the Department, the convenor shall ascertain the names of persons who are willing and qualified to represent the interests that will be significantly affected by the proposed rule. The report by the convenor and any recommendations of the convenor shall be public records and made available to the public for review upon request.

006 PETITIONS FOR THE USE OF A NEGOTIATED RULEMAKING COMMITTEE . Any person may petition the Department to request the use of a negotiated rulemaking committee in the development or revision of a rule, as provided below.

006.01 A negotiated rulemaking process may be requested on any topic appropriate for a rule by the Department.

006.01A A negotiated rulemaking process may be requested only to develop or revise rules which carry out statutes that are within the authority of the Department to implement.

006.01B A negotiated rulemaking process may not be requested to develop a rule to vary or change the specific terms of a statute.

006.01C A negotiated rulemaking process may not be requested to negotiate a rule on a matter which is not within the definition of a rule as set forth in Section 003.08 of this Rule.

006.02 A request for the use of a negotiated rulemaking procedure shall be made by a petition that meets the requirements of form set out in this Section. In the event that it does not, the Department may refuse to accept it.

006.02A The petition may be in the form of a pleading that contains a caption, heading, and name as set forth on Form 49-6-1, which is attached to this Rule and incorporated herein by reference.

006.02B The petition may also be made in the form of a letter if the letter contains all of the information required by this Section and is clearly labeled as a petition for negotiated rulemaking.

006.02C All petitions must be on white, letter sized paper (8 1/2 inches x 11 inches) of standard weight.

006.02D Petitions must be legible, and may be typewritten, printed, or handwritten, or on a form photostatically reproduced. If handwritten, petitions must be in ink. Only one side of a page of a petition shall contain any writing. Petitions must contain an original manual signature of the person requesting negotiated rulemaking or an authorized agent of such person.

006.02E Any documents that are intended to accompany a petition shall be securely fastened, clearly marked as attachments to the petition, and meet the other requirements of this Section as to size, print and legibility.

006.03 A petition for a negotiated rulemaking procedure shall meet the following requirements for content and substance. In the event that it does not, the Department may refuse to accept it.

006.03A The petition must identify the general subject matter about which the negotiated rulemaking procedure is requested, including the statutes, legislative bill(s) or other legal authority that provide authority for the desired rule, and, if amendments to existing rules are sought, identification of the rules by title, chapter and name.

006.03B The petition must identify the specific issue(s) proposed for inclusion in the negotiated rulemaking process.

006.03C The petition must discuss the facts surrounding each problem or issue proposed for inclusion in the negotiated rulemaking process.

006.03D The petition must discuss why a negotiated rulemaking process is in the public interest, including information on each of the criteria set out in Sections 004.01 through 004.05 of this Rule. The petition may also include information on the criteria included in Sections 004.06 and 004.07 of this Rule, to the extent such information is available to the petitioner. The petitioner may also submit such other information as may assist the Department in making a decision.

006.03E The petition must identify persons who will be significantly affected by any rule which might result from the proposed negotiated rulemaking process, to the extent known by the petitioner. The petitioner may also suggest the names of persons who are willing and qualified to represent the interests that will be significantly affected by the negotiated rulemaking process and the proposed rule.

006.04 A petition for a negotiated rulemaking process shall be filed with the Director. Filing may be made by personal delivery during regular Department office hours or by mail to its main office.

006.05 Upon the filing of a petition for a negotiated rulemaking procedure, the Director may designate a Department employee or use the services of a convenor to recommend to the Director whether a negotiated rulemaking process should be initiated.

006.06 Within sixty (60) days after submission of a petition for a negotiated rulemaking procedure, the Department shall:

006.06A Deny the petition in writing, stating the reason(s) for denial; or

006.06B Initiate the negotiated rulemaking process as provided in this Rule.

006.07 The decision of the Department with respect to a petition for a negotiated rulemaking procedure may be made in the form of a pleading or a letter clearly designated as the decision on the petition. The petitioner shall be served with a copy of the final decision by certified mail, return receipt requested.

006.08 A decision by the Department with respect to a petition for a negotiated rulemaking procedure is not subject to judicial review, although nothing herein shall bar a judicial review if such is otherwise provided by law.

007 NOTICE OF A NEGOTIATED RULEMAKING COMMITTEE; COMMENT; APPLICATIONS FOR MEMBERSHIP . If a negotiated rulemaking committee is established, the Department shall use the following process to select committee membership:

007.01 The Department shall give notice to the Nebraska Secretary of State, publish notice in a newspaper having general circulation in the state, and, as appropriate, publish notice in other newspapers and publications. The notice shall include:

007.01A An announcement that the Department intends to establish a negotiated rulemaking committee to negotiate and develop a proposed rule.

007.01B A description of the subject and scope of the rule to be developed and the issues to be considered.

007.01C A list of interests likely to be significantly affected by the proposed rule.

007.01D A list of the persons proposed to represent the affected interests, if known, and the Department.

007.01E A proposed schedule for completing the work of the negotiated rulemaking committee.

007.01F An explanation of how a person may apply for or nominate another person for membership on the negotiated rulemaking committee.

007.02 Persons interested in making comments upon the formation of a particular proposed negotiated rulemaking committee shall have thirty (30) days from the date of publication of the notice concerning that negotiated rulemaking committee to do so. Such comments shall be in writing, and shall either be personally delivered to the Department or mailed to its main office.

007.03 Persons interested in applying for membership on a particular proposed negotiated rulemaking committee or in nominating other persons for such membership shall have thirty (30) days from the date of publication of the notice concerning that negotiated rulemaking committee to do so. Persons making application for membership shall do so on Form 49-6-2; persons making nominations for membership shall do so on Form 49-6-3. Such forms are attached to this Rule and incorporated herein by reference and shall be provided by the Department upon request. Persons making application for membership or nominations for membership may also do so by letter, if the letter contains all of the information set out in Form 49-6-2 or Form 49-6-3 and is clearly designated as an application or nomination for membership on a specific negotiated rulemaking committee.

008 ESTABLISHMENT OF A NEGOTIATED RULEMAKING COMMITTEE; PROCEDURE . After publication of notice and termination of the comment and membership application period, the Department will consider the comments and membership applications for a particular negotiated rulemaking committee and determine whether such a negotiated rulemaking committee can adequately represent the interests of the persons that will be significantly affected by a proposed rule, and whether such a negotiated rulemaking committee is feasible and appropriate in the particular rulemaking. In making the final determination as to creation of a negotiated rulemaking committee, the Department may use the services of a convenor as set out in Section 005 of this Rule. In making the final determination as to creation of a negotiated rulemaking committee, the Department will apply the criteria set out in Section 004 of this Rule.

008.01 If, after such a determination, the Department decides that a negotiated rulemaking procedure is feasible, it shall establish a negotiated rulemaking committee as provided in this Rule. The negotiated rulemaking committee will negotiate issues and develop proposed rules for use by the Department in formal rulemaking.

008.02 If, after such a determination, the Department decides not to establish a negotiated rulemaking committee, the Department shall:

008.02A Notify the persons who commented on, applied for membership on, or nominated persons for membership on the particular negotiated rulemaking committee of the reasons for the decision not to establish such a negotiated rulemaking committee.

008.02B Publish notice of the decision not to establish the particular negotiated rulemaking committee in a newspaper having general circulation in the state, and, as appropriate, in other newspapers and publications.

009 NEGOTIATED RULEMAKING COMMITTEE; MEMBERSHIP . All members of a negotiated rulemaking committee shall participate in the deliberations of the negotiated rulemaking committee with the same rights and responsibilities as other members.

009.01 Members of a negotiated rulemaking committee may include:

009.01A A person designated by the Department to represent the Department. This person shall be authorized to fully represent the Department in the discussions and negotiations of the negotiated rulemaking committee.

009.01B Persons selected by the Department as willing and qualified to represent the interests that will be significantly affected by the proposed rule.

009.01C Persons contacted and recruited by the negotiated rulemaking committee itself by consensus as essential to the success of the negotiated rulemaking process.

009.01D Persons selected by the negotiated rulemaking committee by consensus upon review of a petition for membership or nomination as set out in Section 009.02 of this Rule.

009.02 Persons who will be significantly affected by a proposed rule and who believe that their interests will not be adequately represented by any person on a negotiated rulemaking committee may petition for, or nominate another person for, membership on the negotiated rulemaking committee.

009.02A Each petition or nomination for negotiated rulemaking committee membership shall be in writing and be submitted to the negotiated rulemaking committee by delivering or mailing the same to the Department. All such petitions or nominations shall include:

009.02A1 Identification of the applicable negotiated rulemaking proceeding.

009.02A2 The name of the petitioner or nominee, and a description of the interests the person represents.

009.02A3 Evidence that the petitioner or nominee is authorized to represent parties related to the interests the person proposes to represent.

009.02A4 A written commitment that the petitioner or nominee will actively participate in good faith in the development of the rule under consideration.

009.02A5 An explanation of reasons that the persons already on the negotiated rulemaking committee do not adequately represent the interests of the person submitting the petition or nomination.

009.02B Persons wishing to file such a petition for membership on a negotiated rulemaking committee may use the form attached hereto as Form 49-6-4; persons wishing to file such a petition for nomination to a negotiated rulemaking committee may use the form attached hereto as Form 49-6-5. Forms 49-6-4 and 49-6-5 are made a part of this Rule by reference. Persons wishing to file such a petition for membership or nomination to a negotiated rulemaking committee may also do so by letter, provided that the letter contains the information set forth in Forms 49-6-4 and 49-6-5.

009.02C Upon receiving a petition for membership on or nomination to a particular negotiated rulemaking committee, the negotiated rulemaking committee in question shall decide, by consensus at its next meeting, whether or not to expand its membership.

010 NEGOTIATED RULEMAKING COMMITTEE; OPERATION . A negotiated rulemaking committee established under this Rule shall consider the matter proposed by the Department for consideration and shall attempt to reach consensus concerning a proposed rule and any other matter the negotiated rulemaking committee determines is relevant to the proposed rule.

010.01 A negotiated rulemaking committee may adopt procedures or ground rules for the operation of the negotiated rulemaking committee consistent with this Rule and the pertinent Nebraska statutes.

010.02 The Department shall provide appropriate administrative support to a negotiated rulemaking committee including technical assistance and support.

010.03 The person representing the Department on a negotiated rulemaking committee shall participate in the deliberations of the negotiated rulemaking committee with the same rights and responsibilities as other members of the negotiated rulemaking committee and shall be authorized to fully represent the Department in the discussions and negotiations of the negotiated rulemaking committee.

010.04 If a negotiated rulemaking committee achieves consensus on a proposed rule at the conclusion of the negotiations, the negotiated rulemaking committee shall transmit to the Department a report containing the proposed rule.

010.05 If a negotiated rulemaking committee does not reach a consensus on the proposed rule, the negotiated rulemaking committee shall transmit to the Department a report specifying areas in which the negotiated rulemaking committee reached consensus and the issues that remain unresolved. The negotiated rulemaking committee may include in the report any other information, recommendations, or materials that the committee considers appropriate. Any member of the negotiated rulemaking committee may include as an addendum to the report additional information, recommendations or materials.

011 FACILITATORS; SELECTION; DUTIES . A facilitator shall be selected to assist a negotiated rulemaking committee with its duties.

011.01 The Department may nominate a person to serve as a facilitator for the negotiations of a negotiated rulemaking committee, subject to the approval of the negotiated rulemaking committee by consensus. If the negotiated rulemaking committee does not approve the Department's nominee for facilitator, the Department shall submit a substitute nominee. If the negotiated rulemaking committee does not approve the substitute nominee of the Department for facilitator, the negotiated rulemaking committee shall select, by consensus, a person to serve as facilitator.

011.02 The Department may employ or contract for an organization or an individual to serve as a facilitator for a negotiated rulemaking committee or the Department may use the services of a state employee to act as a facilitator. A person designated by the Department to represent it on a negotiated rulemaking committee with respect to substantive issues may not serve as the facilitator. A facilitator shall not have a financial or other interest that would preclude him or her from serving in an impartial and independent manner. The Department shall determine whether a person under consideration for facilitator has such an interest. A person disqualified under this criterion shall be dropped from further consideration.

011.03 A facilitator approved or selected by a negotiated rulemaking committee shall:

011.03A Preside at the meetings of the negotiated rulemaking committee in an impartial manner.

011.03B Impartially assist members in conducting discussions and negotiations and achieving consensus.

011.03C Manage the keeping of minutes and records of negotiated rulemaking committee meetings, reports and decisions.

012 NEGOTIATED RULEMAKING COMMITTEE; EXPENSES . Members of a negotiated rulemaking committee shall be responsible for their own expenses of participation. However, the Department may pay for a negotiated rulemaking committee member's actual and necessary expenses incurred in serving on the negotiated rulemaking committee as provided in Neb. Rev. Stat. §§ 81-1174 through 81-1177 and a reasonable per diem rate of compensation if:

012.01 The negotiated rulemaking committee member certifies a lack of adequate financial resources to participate on the negotiated rulemaking committee using Form 49-6-6 which is attached to these regulations and incorporated herein by reference.

012.02 The Department determines that the negotiated rulemaking committee member's participation is necessary to assure an adequate representation of the interests of the members.

013 GRANTS OR GIFTS . The Department may accept grants or gifts from any source to fund a negotiated rulemaking process if:

013.01 Information on the name of the person giving the grant or gift and the amount of the grant or gift is available to the public.

013.02 The grant or gift is given to and accepted by the Department without placing any condition on the membership of a negotiated rulemaking committee or the outcome of the negotiated rulemaking process.

013.03 There is a consensus among the members of the negotiated rulemaking committee that the acceptance of the grant or gift will not diminish the integrity of the negotiated rulemaking process.

014 NEGOTIATED RULEMAKING COMMITTEE; TERMINATION . A negotiated rulemaking committee shall terminate upon the adoption of the final rule under consideration by the Department pursuant to the APA, unless the Department, after consulting the negotiated rulemaking committee, or the negotiated rulemaking committee itself sets an earlier termination date.

015 NEGOTIATED RULEMAKING PROCEDURE; JUDICIAL REVIEW . Any action of the Department relating to establishing, assisting or terminating a negotiated rulemaking committee under the Negotiated Rulemaking Act shall not be subject to judicial review, except that nothing in this Section shall bar judicial review if such judicial review is otherwise provided by law.

FORM 49-6-1

Form 49-6-2

Form 49-6-3

Form 49-6-4

Form 49-6-5

Form 49-6-6

History

• Effective 2002-08-20

Chapter 7 Rule of Procedure for Petitioning for Rule Making

Neb. Admin. Code tit. 49, ch. 7 Rule of Procedure for Petitioning for Rule Making {#sec-49-nac-7 omnilex-key=us-ne-regs-official--title-49--49 NAC 7}

001 GENERAL.

001.01 This Rule has been promulgated pursuant to authority delegated to the Director of the Department in Section 84-909 of the APA.

001.02 The Department has determined that this Rule is in the public interest.

001.03 The definitions in 49 NAC 1.002 shall apply to the provisions of this Rule, unless otherwise specified.

002 RULEMAKING PETITION.

002.01 Petition. Any person may petition the Department requesting the promulgation, amendment, or repeal of a rule or regulation.

002.02 Form. The petition shall:

002.02A Be clearly designated as a petition for a rule change.

002.02B In the case of a proposed new rule or amendment of an existing rule, shall set forth the desired rule in its entirety.

002.02C In the case of a petition for the repeal of an existing rule, such shall be stated and the rule proposed to be repealed shall either be set forth in full or shall be referred to by Department rule number.

002.02D Describe the reason for the rule change.

002.02E Include an address, telephone number and e-mail address, if applicable, where the petitioner can be reached during regular work hours.

002.02F Be signed by:

002.02F1 The petitioner or his or her attorney, in which case the attorney shall also state his or her address, telephone number and e-mail address, if applicable; or

002.02F2 A duly authorized officer of the petitioner, if petitioner is a corporation or other legal entity.

003 PETITION CONSIDERATION AND DISPOSITION. Within sixty (60) days after submission of a petition which meets the requirements of Section 002 of this Rule, the Department shall either:

003.01 Deny the petition in writing, stating its reasons therefor;

003.02 Initiate rulemaking proceedings in accordance with the APA; or

003.03 If otherwise lawful, adopt a rule.

History

• Effective 2002-08-20