SF 2396 (LSB 5495SV (2) 88)

SENATE FILE 2396

BY  COMMITTEE ON STATE GOVERNMENT

(SUCCESSOR TO SSB 3191)

A BILL FOR

An Act relating to the rulemaking process for executive branch agencies and including transition provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 2B.13, subsection 2, Code 2020, is amended by adding the following new paragraph:
   NEW PARAGRAPH.  0f.  Update the address, telephone number, facsimile number, or electronic mail address of an agency, officer, or other entity.
    Sec. 2.  Section 17A.4, subsections 4 and 6, Code 2020, are amended to read as follows:
   4.  Any notice of intended action or rule filed without notice pursuant to subsection 3 this section or section 17A.5, which that necessitates additional annual expenditures of at least one hundred thousand dollars or combined expenditures of at least five hundred thousand dollars within five years by all affected persons, including the agency itself, shall be accompanied by a fiscal impact statement outlining the expenditures. The agency shall promptly deliver a copy of the statement to the legislative services agency. To the extent feasible, the legislative services agency shall analyze the statement and provide a summary of that analysis to the administrative rules review committee. If the agency has made a good-faith effort to comply with the requirements of this subsection, the rule shall not be invalidated on the ground that the contents of the statement are insufficient or inaccurate.
   6.  a.  If the administrative rules review committee created by section 17A.8, the governor, or the attorney general finds objection to all or some portion of a proposed or adopted rule because that rule is deemed to be unreasonable, arbitrary, capricious, or otherwise beyond the authority delegated to the agency, the committee, governor, or attorney general may, in writing, notify the agency of the objection. In the case of a rule issued under filed without notice pursuant to subsection 3, or a rule made effective under section 17A.5, subsection 2, paragraph “b”, the committee, governor, or attorney general may notify the agency of such an objection. The committee, governor, or attorney general shall also file a certified copy of such an objection in the office of the administrative code editor and a notice to the effect that an objection has been filed shall be published in the next issue of the Iowa administrative bulletin and in the Iowa administrative code when that rule is printed in it. The burden of proof shall then be on the agency in any proceeding for judicial review or for enforcement of the rule heard subsequent to the filing to establish that the rule or portion of the rule timely objected to according to the above procedure is not unreasonable, arbitrary, capricious, or otherwise beyond the authority delegated to it.
   b.  If the agency fails to meet the burden of proof prescribed for a rule objected to according to the provisions of paragraph “a”, the court shall declare the rule or portion of the rule objected to invalid and judgment shall be rendered against the agency for court costs. Such court costs shall include a reasonable attorney fee and shall be payable by the director of the department of administrative services from the support appropriations of the agency which issued adopted the rule in question.
    Sec. 3.  Section 17A.4, subsection 7, Code 2020, is amended by striking the subsection.
    Sec. 4.  Section 17A.5, subsection 2, paragraph b, subparagraph (2), Code 2020, is amended to read as follows:
   (2)  In any subsequent action contesting the effective date of a rule promulgated adopted under this paragraph “b”, the burden of proof shall be on the agency to justify its finding. The agency’s finding and a brief statement of the reasons therefor shall be filed with and made a part of the rule. Prior to indexing and publication, the agency shall make reasonable efforts to make known to the persons who may be affected by it a rule made effective under the terms of this paragraph “b”.
    Sec. 5.  Section 17A.6, Code 2020, is amended by adding the following new subsection:
   NEW SUBSECTION.  3.  In lieu of the procedures established in subsection 2, an agency may establish alternative procedures providing for public access to an electronic or printed copy of a publication containing standards adopted by reference if the publication is proprietary or contains proprietary information.
    Sec. 6.  Section 17A.6A, subsection 2, paragraph c, Code 2020, is amended to read as follows:
   c.  Process forms and instructions for filing a petition for rulemaking pursuant to section 17A.7, a petition for a declaratory order pursuant to section 17A.9, or a petition for a waiver or variance of an administrative rule pursuant to section 17A.9A.
    Sec. 7.  Section 17A.7, subsection 1, Code 2020, is amended to read as follows:
   1.  An interested person may petition an agency requesting the adoption, amendment, or repeal of a rule. Each agency shall prescribe by rule the form for petitions and the procedure for their submission, consideration, and disposition. Within sixty days after submission of a petition, the agency either shall deny the petition in writing on the merits, stating its reasons for the denial, or initiate rulemaking proceedings in accordance with section 17A.4, or issue adopt a rule if it is not required to be issued filed according to the procedures of section 17A.4, subsection 1.  The agency shall submit the petition and the disposition of the petition to the administrative rules review committee.
    Sec. 8.  Section 17A.8, subsections 2, 5, and 9, Code 2020, are amended to read as follows:
   2.  A committee member shall be appointed prior to as of the adjournment convening of a regular session convened in an odd-numbered year. The term of office for a member of the house of representatives shall be for four years beginning May 1 end upon the convening of the year of appointment general assembly following the appointment.  The term of office for a member of the senate shall end upon the convening of the general assembly after the general assembly following appointment. However, a member shall serve until a successor is appointed. A vacancy on the committee shall be filled by the original appointing authority for the remainder of the term. A vacancy shall exist whenever a committee member ceases to be a member of the house from which the member was appointed.
   5.  A regular committee meeting shall be held at the seat of government on the second Tuesday of each month or on an alternative date established by the committee. Unless impracticable, in advance of each such meeting the subject matter to be considered shall be published in the Iowa administrative bulletin. A special committee meeting may be called by the chairperson at any place in the state and at any time. Unless impracticable, in advance of each special meeting notice of the time and place of such meeting and the subject matter to be considered shall be published in the Iowa administrative bulletin.
   9.  a.  Upon a vote of two-thirds of its members, the administrative rules review committee may delay the effective date of a rule or portion of a rule until the adjournment of the next regular session of the general assembly, unless the rule was promulgated adopted under section 17A.5, subsection 2, paragraph “b”. If the rule was promulgated adopted under section 17A.5, subsection 2, paragraph “b”, the administrative rules review committee, within thirty-five days of the effective date publication of the rule in the Iowa administrative bulletin and upon the vote of two-thirds of its members, may suspend the applicability of the rule or portion of the rule until the adjournment of the next regular session of the general assembly.
   b.  The committee shall refer a rule or portion of a rule whose effective date has been delayed or applicability has been suspended to the speaker of the house of representatives and the president of the senate who shall refer the delayed or suspended rule or portion of the rule to the appropriate standing committees of the general assembly. A standing committee shall review the rule within twenty-one days after the rule is referred to the committee by the speaker of the house of representatives or the president of the senate and shall take formal committee action by sponsoring a joint resolution to disapprove nullify the rule, by proposing legislation relating to the rule, or by refusing to propose a joint resolution or legislation concerning the rule. The standing committee shall inform the administrative rules review committee of the committee action taken concerning the rule. If the general assembly has not disapproved of nullified the rule by a joint resolution, the rule shall become effective upon the adjournment of the session of the general assembly. The speaker of the house of representatives and the president of the senate shall notify the administrative code editor of the final disposition of each rule or portion of a rule whose effective date has been delayed or whose applicability has been suspended pursuant to this subsection. If the rule is disapproved, the rule shall not be effective and the agency shall rescind the rule. 
    Sec. 9.  Section 17A.8, Code 2020, is amended by adding the following new subsection:
   NEW SUBSECTION.  10.  a.  Upon the vote of two-thirds of its members, the administrative rules review committee may delay the effective date of a rule or portion of a rule seventy days beyond that permitted in section 17A.5, unless the rule was adopted under section 17A.5, subsection 2, paragraph “b”. If the rule was adopted under section 17A.5, subsection 2, paragraph “b”, the administrative rules review committee, within thirty-five days of the publication of the rule in the Iowa administrative bulletin and upon the vote of two-thirds of its members, may suspend the applicability of the rule or portion of the rule for seventy days.
   b.  Notice of an effective date that was delayed under this provision shall be published in the Iowa administrative code and bulletin.
    Sec. 10.  Section 17A.9A, Code 2020, is amended to read as follows:
   17A.9A  Waivers and variances.
   1.  Any person may petition an agency for a waiver or variance from the requirements of a rule, pursuant to the requirements of this section, if the agency has established by rule an application, evaluation, and issuance procedure permitting waivers and variances. An agency shall not grant a petition for waiver or a variance of a rule unless the agency has jurisdiction over the rule and the waiver or variance is consistent with any applicable statute, constitutional provision, or other provision of law. In addition, this section does not authorize an agency to waive or vary any requirement created or duty imposed by statute.
   2.  Upon petition of a person, an agency may in its sole discretion issue a waiver or variance from the requirements of a rule if the agency finds, based on clear and convincing evidence, all of the following:
   a.  The application of the rule would pose an undue hardship on the person for whom the waiver or variance is requested.
   b.  The waiver or variance from the requirements of a rule in the specific case would not prejudice the substantial legal rights of any person.
   c.  The provisions of a rule subject to a petition for a waiver or variance are not specifically mandated by statute or another provision of law.
   d.  Substantially equal protection of public health, safety, and welfare will be afforded by a means other than that prescribed in the particular rule for which the waiver or variance is requested.
   3.  The burden of persuasion rests with the person who petitions an agency for the waiver or variance of a rule. Each petition for a waiver or variance shall be evaluated by the agency based on the unique, individual circumstances set out in the petition. A waiver or variance, if granted, shall be drafted by the agency so as to provide the narrowest exception possible to the provisions of the rule. The agency may place any condition on a waiver or a variance that the agency finds desirable to protect the public health, safety, and welfare. A waiver or variance shall not be permanent, unless the petitioner can show that a temporary waiver or variance would be impracticable. If a temporary waiver or variance is granted, there is no automatic right to renewal. At the sole discretion of the agency, a waiver or variance may be renewed if the agency finds all of the factors set out in subsection 2 remain valid.
   4.  A grant or denial of a waiver or variance petition shall be indexed, filed, and available for public inspection as provided in section 17A.3. The administrative code editor and the administrative rules coordinator shall devise a mechanism an internet site to identify rules for which a petition for a waiver or variance has been granted or denied and make this information available to the public.  When an agency grants a waiver, the agency shall submit the information required by this subsection on the internet site within sixty days. The internet site
   5.  Semiannually, each agency which permits the granting of petitions for waivers or variances shall prepare a report of these actions identifying identify the rules for which a waiver or variance has been granted or denied, the number of times a waiver or variance was granted or denied for each rule, a citation to the statutory provisions implemented by these rules, and a general summary of the reasons justifying the agencies’ actions on the waiver or variance request. To the extent practicable, this report the agency shall detail include information detailing the extent to which the granting of a waiver or variance has established a precedent for additional waivers or variances and the extent to which the granting of a waiver or variance has affected the general applicability of the rule itself. Copies of this report shall be provided semiannually to the administrative rules coordinator and the administrative rules review committee.
   6.  5.  For purposes of this section, “a waiver or variance” means an agency action which suspends in whole or in part the requirements or provisions of a rule as applied to an identified person on the basis of the particular circumstances of that person.
    Sec. 11.  Section 17A.22, Code 2020, is amended to read as follows:
   17A.22  Agency authority to implement chapter.
   Agencies shall have all the authority necessary to comply with the requirements of this chapter through the issuance adoption of rules or otherwise.
    Sec. 12.  TRANSITION PROVISIONS —— MEMBERSHIP OF ADMINISTRATIVE RULES REVIEW COMMITTEE.  Notwithstanding section 17A.8, subsection 2, as amended by this Act, the terms of members of the administrative rules review committee as of the effective date of this Act shall continue until the convening of the 2021 regular session of the general assembly.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill relates to the administrative rulemaking process under Code chapter 17A, the Iowa administrative procedure Act.
   The bill allows the administrative code editor to update the address, telephone number, facsimile number, or electronic mail address of an agency, officer, or other entity when preparing the copy for an edition of the Iowa administrative code or Iowa administrative bulletin.
   The bill provides that all rule filings that necessitate additional annual expenditures of at least $100,000 or combined expenditures of at least $500,000 within five years by all affected persons, including the agency itself, shall be accompanied by a fiscal impact statement outlining the expenditures, which is then analyzed by the legislative services agency. Current law provides that only notices of intended action and rules filed without notice are subject to this requirement.
   The bill authorizes an agency to establish alternative procedures for providing public access to an electronic or printed copy of a publication containing standards adopted by reference in rulemaking if the publication is proprietary or contains proprietary information. Current statutory procedures provide for publication on the general assembly’s internet site or depositing a printed copy in the state law library.
   The bill requires agencies to submit petitions for rulemaking and the disposition of such petitions to the administrative rules review committee (ARRC).
   The bill modifies the terms of office of ARRC members by providing that terms for members of the house of representatives commence at the convening of a regular session convened in an odd-numbered year and end at the convening of the following general assembly. Terms for members of the senate commence at the convening of a regular session convened in an odd-numbered year and end at the convening of the general assembly after the following general assembly. Under current law terms of office for all members last four years commencing on May 1 with appointments made prior to the adjournment of a regular session convened in an odd-numbered year. The bill provides that current terms of ARRC members continue until the convening of the 2021 regular session of the general assembly.
   The bill provides that the ARRC may establish an alternative date for its regular monthly meeting.
   The bill authorizes the ARRC to suspend the applicability of emergency rules filed using the procedure provided in Code section 17A.5, subsection 2, paragraph “b”, subparagraph 1, within 35 days of the publication of the rule in the Iowa administrative bulletin. Under current law, the ARRC may do so within 35 days of the rule’s effective date.
   The bill revises language on procedures relating to delays of effective dates of rules and suspension of applicability of rules by the ARRC until the adjournment of the next regular session of the general assembly by replacing references to joint resolutions disapproving of rules with references to nullification of rules.
   The bill transfers language authorizing the delay of effective dates of rules and suspension of applicability of rules by the ARRC for 70 days from Code section 17A.4 to Code section 17A.8.
   The bill modifies requirements for waiver or variance of rules by agencies by striking references to variances. The bill strikes a requirement that agencies submit semiannual reports on waivers of rules to the administrative rules coordinator and the administrative rules review committee. The bill requires that agencies submit information regarding a waiver on an internet site devised by the administrative rules coordinator within 60 days of granting or denying the waiver.
   The bill standardizes terminology referring to adoption of rules throughout Code chapter 17A.