Prior Review Of Agency Rules That Burden Industry

Under current law, executive agency rules take effect 20 days after the agency adopts the rule, or on a later date if specified in the rule. After adoption, the office of legislative legal services (OLLS) at the direction of the general assembly's committee on legal services (committee) reviews agency rules on an annual cycle, commencing with agency rules adopted on or after November 1 of one year through October 31 of the following year, and recommends the expiration of certain rules to the committee based a determination that the rules do not comply with statute. The committee votes on whether to recommend the nonextension of those rules to the general assembly, as reflected in the annual rule review bill. Rules that are not extended by the general assembly in the annual rule review bill expire on May 15 of the year following the year in which they were enacted.

The bill requires the governor or the governor's designee to review each proposed rule for compliance with the agency's statutory authority and other criteria set forth in statute, and prohibits an agency from adopting such proposed rule unless and until the governor or governor's designee determines its compliance.

The bill creates a new prior review process for review of rules adopted by an agency on and after November 1, 2022, that significantly increase the regulatory burden on businesses, professions, occupations, and industries, including the oil and gas, aerospace, energy efficiency and environmental technology, transportation, and agriculture industries (economic impact rules). As part of the rule-making process, the agency determines whether the rule is an economic impact rule at the conclusion of the rule-making process. The agency must send the list of economic impact rules to the general assembly, the OLLS, and the secretary of state. A rule that an agency determines to be an economic impact rule cannot take effect until completion of the prior review process established in the bill.

Each economic impact rule is assigned to a single legislative prior review committee consisting of the members of either the house of representatives' or senate's committee of reference that hears matters relating to the subject of the economic impact rule or that considered the legislation authorizing the economic impact rule. Within 21 days after the commencement of the regular legislative session, the prior review committee may select economic impact rules for review under the prior review process established in the bill. Economic impact rules that are not selected for prior review take effect on the twenty-second day after the commencement of the legislative session.

With respect to economic impact rules selected by a prior review committee for prior review, the prior review committee may take the following actions:

• By majority vote, make the rule effective immediately or on another date;
• By majority vote, determine that the rule exceeds the agency's rule-making authority or fails to meet other requirements for rule-making set forth in statute; or
• Take no action.

If the committee takes no action on a selected economic impact rule within 64 days after the commencement of the applicable regular legislative session, the selected rule is deemed effective on the sixty-fifth day after the commencement of the legislative session.

(Note: This summary applies to this bill as introduced.)