Bill Text: CA AB530 | 2011-2012 | Regular Session | Amended
Bill Title: Regulations: economic and technical information.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2012-02-01 - Died pursuant to Art. IV, Sec. 10(c) of the Constitution. From committee: Filed with the Chief Clerk pursuant to Joint Rule 56. [AB530 Detail]
Download: California-2011-AB530-Amended.html
BILL NUMBER: AB 530 AMENDED BILL TEXT AMENDED IN ASSEMBLY MARCH 31, 2011 INTRODUCED BY Assembly Member Smyth FEBRUARY 15, 2011 An act to amendSection 9147.7Sections 11346.2, 11346.3, and 11346.5 of the Government Code, relating to state government. LEGISLATIVE COUNSEL'S DIGEST AB 530, as amended, Smyth.Joint Sunset Review Committee: agency repeal.Regulations: economic and technical information. The Administrative Procedure Act governs the procedure for the adoption, amendment, or repeal of regulations by state agencies and for the review of those regulatory actions by the Office of Administrative Law. The act requires an agency, as part of the regulatory adoption process, to assess the potential for adverse economic impact on California business enterprises and individuals, as specified. The act requires an agency that seeks to adopt, amend, or repeal a regulation to release a notice of proposed action with prescribed information, including specified information regarding adverse economic impacts. The act requires an agency to file with the office, when it files the notice of proposed action, an initial statement of reasons that includes, among other things, a description of reasonable alternatives to the proposed regulation and the agency' s reason for rejecting the alternatives, as specified. This bill would require the initial statement of reasons to also identify each document, including, but not limited to, technical, theoretical, and empirical studies, reports, or similar documents, upon which the agency relied in rejecting each reasonable alternative. The bill would prohibit an agency from rejecting a reasonable alternative unless the statement of reasons includes at least one of these documents. The bill would also repeal a provision that authorizes the agency to avoid having to artificially construct alternatives, describe unreasonable alternatives, or justify why it did not describe alternatives. The bill would require an agency to determine whether a proposed regulation will have a significant adverse economic impact by completing an economic impact statement, using a form developed by the Department of Finance, as specified. The bill would require the agency to post the economic impact statement, including specified supporting information, on the agency's Internet Web site and include it as part of the rulemaking file, as specified. The bill would require that the notice of proposed action include a notice that describes how the public may obtain access to the economic impact statement, including the supporting information, on the agency Internet Web site or in hard copy, as specified.Existing law establishes the Joint Sunset Review Committee to identify and eliminate waste, duplication, and inefficiency in government agencies by conducting a comprehensive analysis of every "eligible agency," as defined, to determine if an agency scheduled for repeal is still necessary and cost effective.This bill would make a technical, nonsubstantive change to that provision.Vote: majority. Appropriation: no. Fiscal committee:noyes . State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 11346.2 of the Government Code , as amended by Section 1 of Chapter 398 of the Statutes of 2010, is amended to read: 11346.2. Every agency subject to this chapter shall prepare, submit to the office with the notice of the proposed action as described in Section 11346.5, and make available to the public upon request, all of the following: (a) A copy of the express terms of the proposed regulation. (1) The agency shall draft the regulation in plain, straightforward language, avoiding technical terms as much as possible, and using a coherent and easily readable style. The agency shall draft the regulation in plain English. (2) The agency shall include a notation following the express terms of each California Code of Regulations section, listing the specific statutes or other provisions of law authorizing the adoption of the regulation and listing the specific statutes or other provisions of law being implemented, interpreted, or made specific by that section in the California Code of Regulations. (3) The agency shall use underline or italics to indicate additions to, and strikeout to indicate deletions from, the California Code of Regulations. (b) An initial statement of reasons for proposing the adoption, amendment, or repeal of a regulation. This statement of reasons shall include, but not be limited to, all of the following: (1) A statement of the specific purpose of each adoption, amendment, or repeal and the rationale for the determination by the agency that each adoption, amendment, or repeal is reasonably necessary to carry out the purpose for which it is proposed. Where the adoption or amendment of a regulation would mandate the use of specific technologies or equipment, a statement of the reasons why the agency believes these mandates or prescriptive standards are required. (2) An identification of each technical, theoretical, and empirical study, report, or similar document, if any, upon which the agency relies in proposing the adoption, amendment, or repeal of a regulation. (3) (A) A description of reasonable alternatives to the regulation and the agency's reasons for rejecting those alternatives. In the case of a regulation that would mandate the use of specific technologies or equipment or prescribe specific actions or procedures, the imposition of performance standards shall be considered as an alternative. (B) A description of reasonable alternatives to the regulation that would lessen any adverse impact on small business and the agency' s reasons for rejecting those alternatives.(C) Notwithstanding subparagraph (A) or (B), an agency is not required to artificially construct alternatives, describe unreasonable alternatives, or justify why it has not described alternatives.(C) The identification of all documents, including, but not limited to, technical, theoretical, and empirical studies, reports, or similar documents, upon which the agency relied in rejecting each reasonable alternative described in this paragraph. For purposes of this paragraph, an agency shall not be permitted to reject a reasonable alternative unless the statement of reasons includes at least one document for each rejected reasonable alternative. (4) Facts, evidence, documents, testimony, or other evidence on which the agency relies to support an initial determination that the action will not have a significant adverse economic impact on business. (5) A department, board, or commission within the Environmental Protection Agency, the Resources Agency, or the Office of the State Fire Marshal shall describe its efforts, in connection with a proposed rulemaking action, to avoid unnecessary duplication or conflicts with federal regulations contained in the Code of Federal Regulations addressing the same issues. These agencies may adopt regulations different from federal regulations contained in the Code of Federal Regulations addressing the same issues upon a finding of one or more of the following justifications: (A) The differing state regulations are authorized by law. (B) The cost of differing state regulations is justified by the benefit to human health, public safety, public welfare, or the environment. (c) A state agency that adopts or amends a regulation mandated by federal law or regulations, the provisions of which are identical to a previously adopted or amended federal regulation, shall be deemed to have complied with subdivision (b) if a statement to the effect that a federally mandated regulation or amendment to a regulation is being proposed, together with a citation to where an explanation of the provisions of the regulation can be found, is included in the notice of proposed adoption or amendment prepared pursuant to Section 11346.5. However, the agency shall comply fully with this chapter with respect to any provisions in the regulation that the agency proposes to adopt or amend that are different from the corresponding provisions of the federal regulation. (d) This section shall be inoperative from January 1, 2012, until January 1, 2014. SEC. 2. Section 11346.2 of the Government Code , as added by Section 2 of Chapter 398 of the Statutes of 2010, is amended to read: 11346.2. Every agency subject to this chapter shall prepare, submit to the office with the notice of the proposed action as described in Section 11346.5, and make available to the public upon request, all of the following: (a) A copy of the express terms of the proposed regulation. (1) The agency shall draft the regulation in plain, straightforward language, avoiding technical terms as much as possible, and using a coherent and easily readable style. The agency shall draft the regulation in plain English. (2) The agency shall include a notation following the express terms of each California Code of Regulations section, listing the specific statutes or other provisions of law authorizing the adoption of the regulation and listing the specific statutes or other provisions of law being implemented, interpreted, or made specific by that section in the California Code of Regulations. (3) The agency shall use underline or italics to indicate additions to, and strikeout to indicate deletions from, the California Code of Regulations. (b) An initial statement of reasons for proposing the adoption, amendment, or repeal of a regulation. This statement of reasons shall include, but not be limited to, all of the following: (1) A statement of the specific purpose of each adoption, amendment, or repeal and the rationale for the determination by the agency that each adoption, amendment, or repeal is reasonably necessary to carry out the purpose for which it is proposed. (2) An identification of each technical, theoretical, and empirical study, report, or similar document, if any, upon which the agency relies in proposing the adoption, amendment, or repeal of a regulation. (3) Where the adoption or amendment of a regulation would mandate the use of specific technologies or equipment, a statement of the reasons why the agency believes these mandates or prescriptive standards are required. (4) (A) A description of reasonable alternatives to the regulation and the agency's reasons for rejecting those alternatives. (B) A description of any performance standard that was considered as an alternative. In the case of a regulation that would mandate the use of specific technologies or equipment or prescribe specific actions or procedures, the imposition of performance standards shall be considered as an alternative. (C) A description of reasonable alternatives to the regulation that would lessen any adverse impact on small business and the agency' s reasons for rejecting those alternatives.(D) Notwithstanding subparagraph (A), (B), or (C), an agency is not required to artificially construct alternatives, describe unreasonable alternatives, or justify why it has not described alternatives.(D) The identification of all documents, including, but not limited to, technical, theoretical, and empirical studies, reports, or similar documents, upon which the agency relied in rejecting each reasonable alternative described in this paragraph. For purposes of this paragraph, an agency shall not be permitted to reject a reasonable alternative unless the statement of reasons includes at least one document for each rejected reasonable alternative. (5) Facts, evidence, documents, testimony, or other evidence on which the agency relies to support an initial determination that the action will not have a significant adverse economic impact on business. (6) A department, board, or commission within the Environmental Protection Agency, the Resources Agency, or the Office of the State Fire Marshal shall describe its efforts, in connection with a proposed rulemaking action, to avoid unnecessary duplication or conflicts with federal regulations contained in the Code of Federal Regulations addressing the same issues. These agencies may adopt regulations different from federal regulations contained in the Code of Federal Regulations addressing the same issues upon a finding of one or more of the following justifications: (A) The differing state regulations are authorized by law. (B) The cost of differing state regulations is justified by the benefit to human health, public safety, public welfare, or the environment. (c) A state agency that adopts or amends a regulation mandated by federal law or regulations, the provisions of which are identical to a previously adopted or amended federal regulation, shall be deemed to have complied with subdivision (b) if a statement to the effect that a federally mandated regulation or amendment to a regulation is being proposed, together with a citation to where an explanation of the provisions of the regulation can be found, is included in the notice of proposed adoption or amendment prepared pursuant to Section 11346.5. However, the agency shall comply fully with this chapter with respect to any provisions in the regulation that the agency proposes to adopt or amend that are different from the corresponding provisions of the federal regulation. (d) This section shall become operative on January 1, 2012. (e) This section shall remain in effect only until January 1, 2014, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2014, deletes or extends that date. SEC. 3. Section 11346.3 of the Government Code is amended to read: 11346.3. (a) State agencies proposing to adopt, amend, or repeal any administrative regulation shall assess the potential for adverse economic impact on California business enterprises and individuals, avoiding the imposition of unnecessary or unreasonable regulations or reporting, recordkeeping, or compliance requirements. For purposes of this subdivision, assessing the potential for adverse economic impact shall require agencies, when proposing to adopt, amend, or repeal a regulation, to adhere to the following requirements, to the extent that these requirements do not conflict with other state or federal laws: (1) The proposed adoption, amendment, or repeal of a regulation shall be based on adequate information concerning the need for, and consequences of, proposed governmental action. (2) The state agency, prior to submitting a proposal to adopt, amend, or repeal a regulation to the office, shall consider the proposal's impact on business, with consideration of industries affected including the ability of California businesses to compete with businesses in other states. For purposes of evaluating the impact on the ability of California businesses to compete with businesses in other states, an agency shall consider, but not be limited to, information supplied by interested parties.It is not the intent of this section to impose additional criteria on agencies, above that which exists in current law, in assessing adverse economic impact on California business enterprises, but only to assure that the assessment is made early in the process of initiation and development of a proposed adoption, amendment, or repeal of a regulation.(b) (1) All state agencies proposing to adopt, amend, or repeal any administrative regulations shall assess whether and to what extent it will affect the following: (A) The creation or elimination of jobs within the State of California. (B) The creation of new businesses or the elimination of existing businesses within the State of California. (C) The expansion of businesses currently doing business within the State of California. (2) This subdivision does not apply to the University of California, the Hastings College of the Law, or the Fair Political Practices Commission. (3) Information required from state agencies for the purpose of completing the assessment may come from existing state publications. (c) No administrative regulation adopted on or after January 1, 1993, that requires a report shall apply to businesses, unless the state agency adopting the regulation makes a finding that it is necessary for the health, safety, or welfare of the people of the state that the regulation apply to businesses. (d) (1) The agency shall determine whether the proposed regulation will have a significant adverse economic impact by completing an economic impact statement, using a form developed by the Department of Finance that is consistent with the requirements of this section. (2) The economic impact statement shall identify, among other things, whether and to what extent the proposed regulation will do any the following: (A) Adversely impact small businesses, businesses, employees of businesses, private individuals, jobs or occupations, or California competitiveness, which includes, but is not limited to, adversely impacting the ability of California businesses to compete with other states by making it more costly to produce goods or services in this state. (B) Adversely impact the private sector by imposing reporting requirements or imposing prescriptive requirements instead of performance standards. (3) Each response provided on the economic impact statement shall be supported by facts, evidence, documents, testimony, or other support, including assumptions and calculations, that a reasonable person, in light of these items, would accept as adequate to support the conclusions of the economic assessment. (4) (A) If the economic impact statement identifies an adverse impact to any of the areas described in subparagraph (A) or (B) of paragraph (2), then the regulation shall be deemed to have a significant statewide adverse economic impact for purposes of paragraph (7) of subdivision (a) of Section 11346.5. (B) If the economic impact statement does not identify an adverse impact to any of the areas described in subparagraph (A) or (B) of paragraph (2), then the regulation shall be deemed to not have a significant statewide adverse economic impact for purposes of paragraph (8) of subdivision (a) of Section 11346.5. (5) The economic impact statement, including any supporting facts, evidence, documents, testimony, or other support, including assumptions and calculations, shall be posted on the Internet Web site of the agency, in a format that can be downloaded electronically, no later than the day on which the notice of proposed action is released pursuant to Section 11346.4. The economic impact statement and supporting information shall also be included in the rulemaking record, which shall be publicly available in the manner prescribed by Section 11347.3. If an agency lacks the technological capacity to post the information on its Internet Web site as required by this paragraph, then the agency shall post a statement on the Internet Web site describing how a person can obtain a copy of the economic impact statement and supporting information pursuant to Section 11347.3. (6) The Department of Finance shall not be required to revise the economic impact statement included on Department of Finance standard form 399, in existence on January 1, 2012, to comply with requirements of this subdivision. The Legislature finds and declares that the economic impact statement contained in standard form 399 provides sufficient information for an agency to comply with the requirements of this subdivision. SEC. 4. Section 11346.5 of the Government Code is amended to read: 11346.5. (a) The notice of proposed adoption, amendment, or repeal of a regulation shall include the following: (1) A statement of the time, place, and nature of proceedings for adoption, amendment, or repeal of the regulation. (2) Reference to the authority under which the regulation is proposed and a reference to the particular code sections or other provisions of law that are being implemented, interpreted, or made specific. (3) An informative digest drafted in plain English in a format similar to the Legislative Counsel's digest on legislative bills. The informative digest shall include the following: (A) A concise and clear summary of existing laws and regulations, if any, related directly to the proposed action and of the effect of the proposed action. (B) If the proposed action differs substantially from an existing comparable federal regulation or statute, a brief description of the significant differences and the full citation of the federal regulations or statutes. (C) A policy statement overview explaining the broad objectives of the regulation and, if appropriate, the specific objectives. (4) Any other matters as are prescribed by statute applicable to the specific state agency or to any specific regulation or class of regulations. (5) A determination as to whether the regulation imposes a mandate on local agencies or school districts and, if so, whether the mandate requires state reimbursement pursuant to Part 7 (commencing with Section 17500) of Division 4. (6) An estimate, prepared in accordance with instructions adopted by the Department of Finance, of the cost or savings to any state agency, the cost to any local agency or school district that is required to be reimbursed under Part 7 (commencing with Section 17500) of Division 4, other nondiscretionary cost or savings imposed on local agencies, and the cost or savings in federal funding to the state. For purposes of this paragraph, "cost or savings" means additional costs or savings, both direct and indirect, that a public agency necessarily incurs in reasonable compliance with regulations. (7) If a state agency, in proposing to adopt, amend, or repeal any administrative regulation, makes an initial determination , pursuant to subdivision (d) of Section 11346.3, that the actionmay havehas a significant, statewide adverse economic impact directly affecting business, including the ability of California businesses to compete with businesses in other states, it shall include the following information in the notice of proposed action: (A) Identification of the types of businesses that would be affected. (B) A description of the projected reporting, recordkeeping, and other compliance requirements that would result from the proposed action. (C) The following statement: "The (name of agency) has made an initial determination that the (adoption/amendment/repeal) of this regulation may have a significant, statewide adverse economic impact directly affecting business, including the ability of California businesses to compete with businesses in other states. The (name of agency) (has/has not) considered proposed alternatives that would lessen any adverse economic impact on business and invites you to submit proposals. Submissions may include the following considerations: (i) The establishment of differing compliance or reporting requirements or timetables that take into account the resources available to businesses. (ii) Consolidation or simplification of compliance and reporting requirements for businesses. (iii) The use of performance standards rather than prescriptive standards. (iv) Exemption or partial exemption from the regulatory requirements for businesses." (8) If a state agency, in adopting, amending, or repealing any administrative regulation, makes an initial determination , pursuant to subdivision (d) of Section 11346.3, that the action will not have a significant, statewide adverse economic impact directly affecting business, including the ability of California businesses to compete with businesses in other states, it shall make a declaration to that effect in the notice of proposed action.In making this declaration, the agency shall provide in the record facts, evidence, documents, testimony, or other evidence upon which the agency relies to support its initial determination.An agency's initial determination and declaration that a proposed adoption, amendment, or repeal of a regulation may have or will not have a significant, adverse impact on businesses, including the ability of California businesses to compete with businesses in other states, shall not be grounds for the office to refuse to publish the notice of proposed action. (9) (A) A description of all cost impacts, known to the agency at the time the notice of proposed action is submitted to the office, that a representative private person or business would necessarily incur in reasonable compliance with the proposed action.If(B) If the economic impact statement described in subdivision (d) of Section 11346.3 demonstrates that no cost impacts are known to the agency, it shall state the following: "The agency is not aware of any cost impacts that a representative private person or business would necessarily incur in reasonable compliance with the proposed action." (C) A statement describing how the public may obtain access to the economic impact statement, including the supporting information, on the agency Internet Web site or in hard copy, in the manner prescribed in paragraph (5) of subdivision (d) of Section 11346.3. (10) A statement of the results of the assessment required by subdivision (b) of Section 11346.3. (11) The finding prescribed by subdivision (c) of Section 11346.3, if required. (12) A statement that the action would have a significant effect on housing costs, if a state agency, in adopting, amending, or repealing any administrative regulation, makes an initial determination that the action would have that effect. In addition, the agency officer designated in paragraph (14), shall make available to the public, upon request, the agency's evaluation, if any, of the effect of the proposed regulatory action on housing costs. (13) A statement that the adopting agency must determine that no reasonable alternative considered by the agency or that has otherwise been identified and brought to the attention of the agency would be more effective in carrying out the purpose for which the action is proposed or would be as effective and less burdensome to affected private persons than the proposed action. (14) The name and telephone number of the agency representative and designated backup contact person to whom inquiries concerning the proposed administrative action may be directed. (15) The date by which comments submitted in writing must be received to present statements, arguments, or contentions in writing relating to the proposed action in order for them to be considered by the state agency before it adopts, amends, or repeals a regulation. (16) Reference to the fact that the agency proposing the action has prepared a statement of the reasons for the proposed action, has available all the information upon which its proposal is based, and has available the express terms of the proposed action, pursuant to subdivision (b). (17) A statement that if a public hearing is not scheduled, any interested person or his or her duly authorized representative may request, no later than 15 days prior to the close of the written comment period, a public hearing pursuant to Section 11346.8. (18) A statement indicating that the full text of a regulation changed pursuant to Section 11346.8 will be available for at least 15 days prior to the date on which the agency adopts, amends, or repeals the resulting regulation. (19) A statement explaining how to obtain a copy of the final statement of reasons once it has been prepared pursuant to subdivision (a) of Section 11346.9. (20) If the agency maintains an Internet Web site or other similar forum for the electronic publication or distribution of written material, a statement explaining how materials published or distributed through that forum can be accessed. (b) The agency representative designated in paragraph (14) of subdivision (a) shall make available to the public upon request the express terms of the proposed action. The representative shall also make available to the public upon request the location of public records, including reports, documentation, and other materials, related to the proposed action. If the representative receives an inquiry regarding the proposed action that the representative cannot answer, the representative shall refer the inquiry to another person in the agency for a prompt response. (c) This section shall not be construed in any manner that results in the invalidation of a regulation because of the alleged inadequacy of the notice content or the summary or cost estimates, or the alleged inadequacy or inaccuracy of the housing cost estimates, if there has been substantial compliance with those requirements.SECTION 1.Section 9147.7 of the Government Code is amended to read: 9147.7. (a) For the purpose of this section, "eligible agency" means an agency, authority, board, bureau, commission, conservancy, council, department, division, or office of state government, however denominated, excluding an agency that is constitutionally created or an agency related to postsecondary education, for which a date for repeal has been established by statute on or after January 1, 2011. (b) The Joint Sunset Review Committee is hereby created to identify and eliminate waste, duplication, and inefficiency in government agencies. The purpose of the committee is to conduct a comprehensive analysis over 15 years, and on a periodic basis thereafter, of every eligible agency to determine if the agency is still necessary and cost effective. (c) Each eligible agency scheduled for repeal shall submit to the committee, on or before December 1 prior to the year it is set to be repealed, a complete agency report covering the entire period since last reviewed, including, but not limited to, the following: (1) The purpose and necessity of the agency. (2) A description of the agency budget, priorities, and job descriptions of employees of the agency. (3) Any programs and projects under the direction of the agency. (4) Measures of the success or failures of the agency and justifications for the metrics used to evaluate successes and failures. (5) Any recommendations of the agency for changes or reorganization in order to better fulfill its purpose. (d) The committee shall take public testimony and evaluate the eligible agency prior to the date the agency is scheduled to be repealed. An eligible agency shall be eliminated unless the Legislature enacts a law to extend, consolidate, or reorganize the eligible agency. No eligible agency shall be extended in perpetuity unless specifically exempted from the provisions of this section. The committee may recommend that the Legislature extend the statutory sunset date for no more than one year to allow the committee more time to evaluate the eligible agency. (e) The committee shall be comprised of 10 members of the Legislature. The Senate Committee on Rules shall appoint five members of the Senate to the committee, not more than three of whom shall be members of the same political party. The Speaker of the Assembly shall appoint five members of the Assembly to the committee, not more than three of whom shall be members of the same political party. Members shall be appointed within 15 days after the commencement of the regular session. Each member of the committee who is appointed by the Senate Committee on Rules or the Speaker of the Assembly shall serve during that committee member's term of office or until that committee member no longer is a Member of the Senate or the Assembly, whichever is applicable. A vacancy on the committee shall be filled in the same manner as the original appointment. Three Assembly Members and three Senators who are members of the committee shall constitute a quorum for the conduct of committee business. Members of the committee shall receive no compensation for their work with the committee. (f) The committee shall meet not later than 30 days after the first day of the regular session to choose a chairperson and to establish the schedule for eligible agency review provided for in the statutes governing the eligible agencies. The chairperson of the committee shall alternate every two years between a Member of the Senate and a Member of the Assembly, and the vice chairperson of the committee shall be a member of the opposite house as the chairperson. (g) This section shall not be construed to change the existing jurisdiction of the budget or policy committees of the Legislature.