This is just the I flag rule. It is unfortunate they don't always fly the flag, but if the sailing instructions indicate to assume I flag even when there isn't one then that's the rule. My club used to use the I flag rule a long time ago but now always uses P flag. I think the idea was to get OCS boats clear of the start line before they duck back to reduce mayhem. I'm not sure it actually reduced any mayhem.
30.1 I Flag Rule: If flag I has been displayed, and any part of a boat’s hull, crew or equipment is on the course side of the starting line or one of its extensions during the last minute before her starting signal, she shall sail across an extension to the pre-start side before starting.
If it was a matter of controlling an aggressive crowd on the start line, it would be better to put up a U flag or even a black flag instead of the P or I flag. That usually gets a rowdy start line to behave a little better.
30.3 U Flag Rule: If flag U has been displayed, no part of a boat’s hull, crew or equipment shall be in the triangle formed by the ends of the starting line and the first mark during the last minute before her starting signal. If a boat breaks this rule and is identified, she shall be disqualified without a hearing, but not if the race is restarted or resailed.
30.4 Black Flag Rule: If a black flag has been displayed, no part of a boat’s hull, crew or equipment shall be in the triangle formed by the ends of the starting line and the first mark during the last minute before her starting signal. If a boat breaks this rule and is identified, she shall be disqualified without a hearing, even if the race is restarted or resailed, but not if it is postponed or abandoned before the starting signal. If a general recall is signalled or the race is abandoned after the starting signal, the race committee shall display her sail number before the next warning signal for that race, and if the race is restarted or resailed she shall not sail in it. If she does so, her disqualification shall not be excluded in calculating her series score.