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PAG LIN 1 1 Section 1. NEW SECTION. 25C.1 SHORT TITLE. 1 2 This Act may be cited as the "Unfunded Mandates Reform Act 1 3 of 1996". 1 4 Sec. 2. NEW SECTION. 25C.2 PURPOSES. 1 5 The purposes of this chapter are: 1 6 1. To strengthen the partnership between the state 1 7 government and local governments. 1 8 2. To end the imposition, in the absence of full 1 9 consideration by the general assembly, of state mandates on 1 10 local governments without adequate state funding, in a manner 1 11 that may displace other essential local governmental 1 12 priorities. 1 13 3. To assist the general assembly in its consideration of 1 14 proposed legislation establishing or revising state programs 1 15 containing state mandates affecting local governments and the 1 16 private sector by the following: 1 17 a. Providing for the development of information about the 1 18 nature and size of mandates in proposed legislation. 1 19 b. Establishing a mechanism to bring the information to 1 20 the attention of the senate and the house of representatives 1 21 before the senate and the house of representatives vote on 1 22 proposed legislation. 1 23 4. To promote informed and deliberate decisions by the 1 24 general assembly on the appropriateness of state mandates in 1 25 any particular instance. 1 26 5. To require that the general assembly consider whether 1 27 to provide funding to assist local governments in complying 1 28 with state mandates, to require analyses of the impact of 1 29 private sector mandates, and, through the dissemination of 1 30 that information, to provide informed and deliberate decisions 1 31 by the general assembly and state agencies and retain 1 32 competitive balance between the public and private sectors. 1 33 6. To establish a vote on the consideration in the senate 1 34 and house of representatives of legislation containing 1 35 significant state governmental mandates without providing 2 1 adequate funding to comply with the mandates. 2 2 7. To assist state agencies in their consideration of 2 3 proposed rules affecting local governments, by the following: 2 4 a. Requiring that state agencies develop a process to 2 5 enable the elected and other officials of local governments to 2 6 provide input when state agencies are developing 2 7 administrative rules. 2 8 b. Requiring that state agencies prepare and consider 2 9 estimates of the budgetary impact of rules containing state 2 10 mandates upon local governments and the private sector before 2 11 adopting the rules. 2 12 8. To begin consideration of the effect of previously 2 13 imposed state mandates, including the impact on local 2 14 governments of state court interpretations of statutes and 2 15 rules that impose state governmental mandates. 2 16 Sec. 3. NEW SECTION. 25C.3 DEFINITIONS. 2 17 As used in this chapter, unless the context otherwise 2 18 requires: 2 19 1. "Amount" means the total sum of budget authority for 2 20 any state grant assistance program or any state program 2 21 providing loan guarantees or direct loans. 2 22 2. "Direct costs": 2 23 a. In the case of a state governmental mandate, means the 2 24 aggregate estimated amounts that all local governments would 2 25 be required to spend or would be prohibited from raising in 2 26 revenues in order to comply with the state governmental 2 27 mandate. 2 28 b. In the case of a provision referred to in subsection 7, 2 29 paragraph "a", subparagraph (2), means the amount of state 2 30 financial assistance eliminated or reduced. 2 31 c. In the case of a state private sector mandate, means 2 32 the aggregate estimated amounts that the private sector will 2 33 be required to spend in order to comply with the state private 2 34 sector mandate. 2 35 d. Shall be determined on the assumption that: 3 1 (1) Local governments and the private sector will take all 3 2 reasonable steps necessary to mitigate the costs resulting 3 3 from the state mandate, and will comply with applicable 3 4 standards of practice and conduct established by recognized 3 5 professional or trade associations. 3 6 (2) Reasonable steps to mitigate the costs shall not 3 7 include increases in local taxes or fees. 3 8 e. Shall not include: 3 9 (1) Estimated amounts that the local governments in the 3 10 case of a state governmental mandate or the private sector in 3 11 the case of a private sector mandate would spend to do any of 3 12 the following: 3 13 (a) To comply with or carry out all applicable state laws 3 14 and rules in effect at the time of the adoption of the state 3 15 mandate for the same activity as is affected by that state 3 16 mandate. 3 17 (b) To comply with or carry out state governmental 3 18 programs or private-sector business or other activities in 3 19 effect at the time of the adoption of the state mandate for 3 20 the same activity as is affected by that mandate. 3 21 (2) Expenditures to the extent that the expenditures will 3 22 be offset by any direct savings to the local governments, or 3 23 by the private sector, as a result of any of the following: 3 24 (a) Compliance with the state mandate. 3 25 (b) Other changes in state law or rules that are enacted 3 26 or adopted in the same bill or joint resolution or proposed or 3 27 final state rule and that govern the same activity as is 3 28 affected by the mandate. 3 29 3. "Direct savings", when used with respect to the result 3 30 of compliance with the state mandate, means: 3 31 a. In the case of a state governmental mandate, the 3 32 aggregate estimated reduction in costs to any local government 3 33 as a result of compliance with the state governmental mandate. 3 34 b. In the case of a private sector mandate, means the 3 35 aggregate estimated reduction in costs to the private sector 4 1 as a result of compliance with the private sector mandate. 4 2 4. "Director" means the director of the legislative fiscal 4 3 bureau. 4 4 5. "Local government" means a political subdivision of 4 5 this state. 4 6 6. "Private sector" means all persons or entities in the 4 7 United States, including individuals, partnerships, 4 8 associations, corporations, and educational and nonprofit 4 9 institutions, but shall not include local governments. 4 10 7. "Private sector mandate" means any provision in statute 4 11 or rule that would do any of the following: 4 12 a. Impose an enforceable duty upon the private sector 4 13 except any of the following: 4 14 (1) A condition of state assistance. 4 15 (2) A duty arising from participation in a voluntary state 4 16 program. 4 17 b. Reduce or eliminate the amount of authorization of 4 18 appropriations for state financial assistance that will be 4 19 provided to the private sector for the purposes of ensuring 4 20 compliance with the duty. 4 21 8. "Small government" means a political subdivision of the 4 22 state with the following population qualifications: 4 23 a. A county having a population of less than fifteen 4 24 thousand. 4 25 b. A city having a population of less than three thousand. 4 26 c. A township having a population of less than three 4 27 thousand. 4 28 9. "State agency" means an office, bureau, department, 4 29 board, division, or commission within the executive branch of 4 30 state government. 4 31 10. "State governmental mandate" means: 4 32 a. Any provision in legislation, statute, or rule that 4 33 would do any of the following: 4 34 (1) Would impose an enforceable duty upon local 4 35 governments except any of the following: 5 1 (a) A condition of state assistance. 5 2 (b) A duty arising from participation in a voluntary state 5 3 program except as provided in paragraph "b". 5 4 (2) Reduce or eliminate the amount of authorization of 5 5 state financial assistance that would be provided to local 5 6 governments for the purpose of complying with any previously 5 7 imposed duty unless the duty is reduced or eliminated by a 5 8 corresponding amount. 5 9 b. Any provision in statute or rule that relates to an 5 10 existing state program under which five hundred thousand 5 11 dollars or more is provided annually to local governments, if 5 12 the provision would do any of the following: 5 13 (1) Increase the stringency of conditions of assistance to 5 14 local governments under the program. 5 15 (2) Place restrictions upon, or otherwise decrease, the 5 16 state government's responsibility to provide funding to local 5 17 governments under the program and the local governments that 5 18 participate in the state program lack authority under that 5 19 program to amend their financial or programmatic 5 20 responsibilities to continue providing required services that 5 21 are affected by the statute or rule. 5 22 11. "State mandate" means a state governmental mandate or 5 23 a private sector mandate. 5 24 Sec. 4. NEW SECTION. 25C.4 EXCLUSIONS. 5 25 This chapter shall not apply to any provision in a bill, 5 26 joint resolution, amendment, motion, or conference committee 5 27 report before the general assembly and any provision in a 5 28 proposed or final administrative rule that does any of the 5 29 following: 5 30 1. Enforces constitutional rights of individuals. 5 31 2. Establishes or enforces any statutory rights that 5 32 prohibit discrimination on the basis of age, race, creed, 5 33 color, sex, national origin, religion, or disability. 5 34 3. Requires compliance with accounting and auditing 5 35 procedures with respect to grants or other money or property 6 1 provided by the state or federal government. 6 2 4. Provides for emergency assistance or relief at the 6 3 request of any local government or any official of a local 6 4 government. 6 5 Sec. 5. NEW SECTION. 25C.5 ASSISTANCE TO LEGISLATIVE 6 6 FISCAL BUREAU. 6 7 Each state agency shall provide to the legislative fiscal 6 8 bureau the information and assistance as the director may 6 9 reasonably request to assist in carrying out the powers and 6 10 duties of the legislative fiscal bureau under this chapter. 6 11 Sec. 6. NEW SECTION. 25C.6 DUTIES OF A LEGISLATIVE 6 12 COMMITTEE. 6 13 1. When a standing committee of the senate or the house of 6 14 representatives reports a bill or joint resolution out of 6 15 committee that includes a state mandate, the report of the 6 16 committee accompanying the bill or joint resolution shall 6 17 contain the information required by subsections 3 and 4. 6 18 2. When a standing committee of the senate or the house of 6 19 representatives reports a bill or joint resolution out of 6 20 committee, the committee shall promptly provide the bill or 6 21 joint resolution to the director and shall identify any state 6 22 mandates contained in the bill or resolution. 6 23 3. Each report described under subsection 1 shall contain 6 24 the following: 6 25 a. An identification and description of any state mandates 6 26 in the bill or joint resolution, including the direct costs to 6 27 local governments and to the private sector, required to 6 28 comply with the state mandates. 6 29 b. A qualitative and, if practicable, a quantitative 6 30 assessment of costs and benefits anticipated from the state 6 31 mandates including, but not limited to, the effects on health 6 32 and safety and protection of the natural environment. 6 33 c. A statement of the degree to which a state mandate 6 34 affects both the public and private sectors and the extent to 6 35 which state payment of public sector costs or the modification 7 1 or termination of the state mandate as provided under section 7 2 25C.8, subsection 1, paragraph "b", would affect the 7 3 competitive balance between local governments and the private 7 4 sector including a description of the actions, if any, taken 7 5 by the committee to avoid any adverse impact on the private 7 6 sector or the competitive balance between the public sector 7 7 and the private sector. 7 8 4. If any of the state mandates in the bill or joint 7 9 resolution are state governmental mandates, the report 7 10 required under subsection 1 shall also contain: 7 11 a. (1) A statement of the amount, if any, of increase or 7 12 decrease in authorization of appropriations under existing 7 13 state financial assistance programs or of authorization of 7 14 appropriations for new state financial assistance provided by 7 15 the bill or joint resolution and usable for activities of 7 16 local governments subject to the state governmental mandates. 7 17 (2) A statement of whether the committee intends that the 7 18 state governmental mandates be partly or entirely unfunded 7 19 and, if so, the reasons for that intention. 7 20 (3) If funded in whole or in part, a statement of whether 7 21 and how the committee has created a mechanism to allocate the 7 22 funding in a manner that is reasonably consistent with the 7 23 expected direct costs among and between the respective levels 7 24 of local government. 7 25 b. Any existing sources of state assistance in addition to 7 26 those identified in paragraph "a" that may assist local 7 27 governments in meeting the direct costs of the state 7 28 governmental mandates. 7 29 5. When a standing committee of the senate or the house of 7 30 representatives reports a bill or joint resolution out of 7 31 committee, the committee report accompanying the bill or joint 7 32 resolution shall contain, if relevant to the bill or joint 7 33 resolution, an explicit statement on the extent to which the 7 34 bill or joint resolution is intended to preempt any local law, 7 35 and, if so, an explanation of the effect of the preemption. 8 1 6. a. Upon receiving a statement from the director under 8 2 section 25C.7, a standing committee of the senate or the house 8 3 of representatives shall publish the statement in the 8 4 committee report accompanying the bill or joint resolution to 8 5 which the statement relates if the statement is available at 8 6 the time the report is printed. 8 7 b. If the statement is not published in the report, or if 8 8 the bill or joint resolution to which the statement relates is 8 9 expected to be considered by the senate or house of 8 10 representatives before the report is published, the committee 8 11 shall cause the statement, or a summary of the statement, to 8 12 be published in the senate or house journal in advance of 8 13 floor consideration of the bill or joint resolution. 8 14 Sec. 7. NEW SECTION. 25C.7 DUTIES OF DIRECTOR OF THE 8 15 LEGISLATIVE FISCAL BUREAU. 8 16 1. For each bill or joint resolution reported out of 8 17 committee by a standing committee of the senate or the house 8 18 of representatives, the director of the legislative fiscal 8 19 bureau shall prepare and submit to the committee a statement 8 20 as follows: 8 21 a. If the director estimates that the direct costs of all 8 22 state governmental mandates in the bill or joint resolution 8 23 will equal or exceed one hundred thousand dollars in the 8 24 fiscal year in which any state governmental mandate in the 8 25 bill or joint resolution or in any necessary implementing rule 8 26 would first be effective or one hundred thousand dollars in 8 27 any of the four fiscal years following that fiscal year, the 8 28 director shall so state, specify the estimate, and briefly 8 29 explain the basis of the estimate. 8 30 b. Estimates required under paragraph "a" shall include 8 31 estimates and brief explanations of the basis of the estimates 8 32 of all of the following: 8 33 (1) The total amount of the direct costs of complying with 8 34 the state governmental mandates in the bill or joint 8 35 resolution. 9 1 (2) If the bill or resolution contains an authorization of 9 2 appropriations under section 25C.8, subsection 1, paragraph 9 3 "b", subparagraph (2), the amount of new budget authority for 9 4 each fiscal year for a period not to exceed ten years beyond 9 5 the effective date necessary to fund the direct costs of the 9 6 state governmental mandate. 9 7 (3) The amount, if any, of increase in authorization of 9 8 appropriations under existing state financial assistance 9 9 programs, or of authorization of appropriations for new state 9 10 financial assistance, provided by the bill or joint resolution 9 11 and usable by local governments for activities subject to the 9 12 state mandates. 9 13 c. If the director determines that it is not feasible to 9 14 make a reasonable estimate that would be required under 9 15 paragraphs "a" and "b", the director shall report in the 9 16 statement that the reasonable estimate cannot be made and 9 17 shall include the reasons for that determination in the 9 18 statement. If a determination is made by the director, a 9 19 point of order under this chapter shall lie only under section 9 20 25C.8, subsection 1, paragraph "a", and as if the requirement 9 21 of section 25C.8, subsection 1, paragraph "a", had not been 9 22 met. 9 23 2. For each bill or joint resolution reported out of 9 24 committee by a standing committee of the senate or the house 9 25 of representatives, the director of the legislative fiscal 9 26 bureau shall prepare and submit to the committee a statement 9 27 as follows: 9 28 a. If the director estimates that the direct costs of all 9 29 private sector mandates in the bill or joint resolution will 9 30 equal or exceed five hundred thousand dollars in the fiscal 9 31 year in which any private sector mandate in the bill or joint 9 32 resolution or in any necessary implementing rule would first 9 33 be effective or five hundred thousand dollars in any of the 9 34 four fiscal years following that fiscal year, the director 9 35 shall so state, specify the estimate, and briefly explain the 10 1 basis of the estimate. 10 2 b. Estimates required under paragraph "a" shall include 10 3 estimates and a brief explanation of the basis of the 10 4 estimates of the following: 10 5 (1) The total amount of direct costs of complying with the 10 6 private sector mandates in the bill or joint resolution. 10 7 (2) The amount, if any, of increase in authorization of 10 8 appropriations under existing state financial assistance 10 9 programs, or of authorization of appropriations for new state 10 10 financial assistance, provided by the bill or joint resolution 10 11 usable by the private sector for the activities subject to the 10 12 private sector mandates. 10 13 c. If the director determines that it is not feasible to 10 14 make a reasonable estimate that would be required under 10 15 paragraphs "a" and "b", the director shall report in the 10 16 statement that a reasonable estimate cannot be made and shall 10 17 include the reasons for that determination in the statement. 10 18 3. If the director estimates that the direct costs of a 10 19 state mandate will not equal or exceed the thresholds 10 20 specified in subsections 1 and 2, the director shall so state 10 21 and shall briefly explain the basis of the estimate. 10 22 4. If a bill or joint resolution is passed in an amended 10 23 form, including if passed by one house as an amendment in the 10 24 nature of a substitute for the text of a bill or joint 10 25 resolution from the other house, or is reported by a 10 26 conference committee in amended form, and the amended form 10 27 contains a state mandate not previously considered by either 10 28 house or which contains an increase in the direct costs of a 10 29 previously considered state mandate, the conference committee 10 30 shall ensure, to the greatest extent practicable, that the 10 31 director shall prepare a statement as provided in this section 10 32 or a supplemental statement for the bill or joint resolution 10 33 in that amended form. 10 34 Sec. 8. NEW SECTION. 25C.8 LEGISLATIVE PROCEDURES. 10 35 1. It shall not be in order in the senate or the house of 11 1 representatives to consider: 11 2 a. Any bill or joint resolution that is reported out of 11 3 committee by a standing committee unless the committee has 11 4 published a statement of the director on the direct costs of 11 5 state mandates in accordance with section 25C.6, subsection 6, 11 6 before the consideration, except that this paragraph shall not 11 7 apply to any supplemental statement prepared by the director 11 8 under section 25C.7, subsection 4. 11 9 b. Any bill, joint resolution, amendment, motion, or 11 10 conference committee report that would increase the direct 11 11 costs of state governmental mandates by an amount that causes 11 12 the thresholds specified in section 25C.7, subsection 1, 11 13 paragraph "a", to be exceeded, unless any of the following 11 14 applies: 11 15 (1) The bill, joint resolution, amendment, motion, or 11 16 conference committee report provides new budget authority or 11 17 new entitlement authority for each fiscal year for the state 11 18 mandates included in the bill, joint resolution, amendment, 11 19 motion, or conference committee report in an amount equal to 11 20 or exceeding the direct costs of the state governmental 11 21 mandate. 11 22 (2) The bill, joint resolution, amendment, motion, or 11 23 conference committee report includes an authorization for 11 24 appropriations in an amount equal to or exceeding the direct 11 25 costs of the state governmental mandate, and the bill, joint 11 26 resolution, amendment, motion, or conference committee report 11 27 does any of the following: 11 28 (a) Identifies a specific dollar amount of the direct 11 29 costs of the state governmental mandate for each year up to 11 30 ten years during which the state governmental mandate shall be 11 31 in effect under the bill, joint resolution, amendment, motion, 11 32 or conference committee report, and the estimate is consistent 11 33 with the estimate determined under subsection 5 for each 11 34 fiscal year. 11 35 (b) Identifies any appropriation bill that is expected to 12 1 provide for state funding of the direct cost referred to under 12 2 subparagraph subdivision (a). 12 3 (c) (i) Provides that for any fiscal year the responsible 12 4 state agency shall determine whether there are insufficient 12 5 appropriations for that fiscal year to provide for the direct 12 6 costs referred to under subparagraph subdivision (a) of the 12 7 state mandate, and shall no later than thirty days after the 12 8 beginning of the fiscal year notify the appropriate standing 12 9 committees of the general assembly of the determination and 12 10 submit one of the following: 12 11 (I) A statement that the state agency has determined, 12 12 based on a reestimate of the direct costs of the state 12 13 governmental mandate, after consultation with local 12 14 governments, that the amount appropriated is sufficient to pay 12 15 for the direct costs of the state governmental mandate. 12 16 (II) Legislative recommendations for either implementing a 12 17 less costly state governmental mandate or making the state 12 18 governmental mandate ineffective for the fiscal year. 12 19 (ii) Provides for expedited procedures for the 12 20 consideration of the statement or legislative recommendations 12 21 referred to in subparagraph subdivision part (i) by the 12 22 general assembly no later than thirty days after the statement 12 23 or recommendations are submitted to the general assembly. 12 24 (iii) Provides that the state governmental mandate shall: 12 25 (I) In the case of a statement referred to in subparagraph 12 26 subdivision part (i), subpart (I), cease to be effective sixty 12 27 days after the statement is submitted unless the general 12 28 assembly has approved the state agency's determination by 12 29 joint resolution during the sixty-day period. 12 30 (II) Cease to be effective sixty days after the date the 12 31 legislative recommendations of the responsible state agency 12 32 are submitted to the general assembly under subparagraph 12 33 subdivision part (i), subpart (II), unless the general 12 34 assembly provides otherwise by law. 12 35 (III) If the state governmental mandate that has not yet 13 1 taken effect, continues not to be effective unless the general 13 2 assembly provides otherwise by law. 13 3 2. The provisions of subsection 1, paragraph "b", 13 4 subparagraph (2), subparagraph subdivision (a), shall not be 13 5 construed to prohibit or otherwise restrict a local government 13 6 from voluntarily electing to remain subject to the original 13 7 state governmental mandate, complying with the programmatic or 13 8 financial responsibilities of the original state governmental 13 9 mandate, and providing the funding necessary consistent with 13 10 the costs of state assistance, monitoring, and enforcement. 13 11 3. a. The provisions of subsection 1 shall apply to all 13 12 of the following: 13 13 (1) Any legislative provision increasing direct costs of a 13 14 state governmental mandate contained in any bill or joint 13 15 resolution reported out of committee by the committee on 13 16 appropriations of the senate or the house of representatives. 13 17 (2) Any legislative provision increasing direct costs of a 13 18 state governmental mandate contained in any amendment offered 13 19 to a bill or joint resolution reported out of committee by the 13 20 committee on appropriations of the senate or the house of 13 21 representatives. 13 22 (3) Any legislative provision increasing direct costs of a 13 23 state governmental mandate in a conference committee report 13 24 accompanying a bill or joint resolution reported out of 13 25 committee by the committee on appropriations of the senate or 13 26 house of representatives. 13 27 (4) Any legislative provision increasing direct costs of a 13 28 state governmental mandate contained in any amendments in 13 29 disagreement between the two houses to any bill or joint 13 30 resolution reported out of committee by the committee on 13 31 appropriations of the senate or house of representatives. 13 32 b. Upon a point of order being made by any senator or 13 33 representative against any provision listed in paragraph "a", 13 34 and the point of order being sustained by the presiding 13 35 officer, the specific provision shall be deemed stricken from 14 1 the bill, joint resolution, amendment, amendment in 14 2 disagreement, or conference committee report and shall not be 14 3 offered as an amendment from the floor. 14 4 4. For purposes of this section, in the senate, the 14 5 presiding officer of the senate shall consult with the 14 6 committee on rules and administration, to the extent 14 7 practicable, on questions concerning the applicability of this 14 8 section to a pending bill, joint resolution, amendment, 14 9 motion, or conference committee report. 14 10 5. For purposes of this section, in the senate and house 14 11 of representatives, the levels of state mandates for a fiscal 14 12 year shall be determined based on the estimates made by the 14 13 committee on appropriations. 14 14 Sec. 9. NEW SECTION. 25C.9 ENFORCEMENT. 14 15 1. It shall not be in order in the senate or house of 14 16 representatives to consider a rule or order that waives the 14 17 application of section 25C.8. 14 18 2. a. This subsection shall apply only to the house of 14 19 representatives. 14 20 b. In order to be cognizable by the presiding officer, a 14 21 point of order under subsection 1 or section 25C.8 must 14 22 specify the precise language on which it is premised. 14 23 c. As disposition of points of order under subsection 1 or 14 24 section 25C.8, the presiding officer shall put the question of 14 25 consideration with respect to the proposition that is the 14 26 subject of the points of order. 14 27 d. A question of consideration under this section shall be 14 28 debatable for ten minutes by each member initiating a point of 14 29 order and for ten minutes by an opponent on each point of 14 30 order, but shall otherwise be decided without intervening 14 31 motion except one that the senate or house adjourn or that the 14 32 committee of the whole arise, as the case may be. 14 33 Sec. 10. NEW SECTION. 25C.10 ESTIMATE OF DIRECT COSTS OF 14 34 AN AMENDMENT. 14 35 At the written request of a senator or representative, the 15 1 director shall prepare, to the extent applicable, an estimate 15 2 of the direct costs of a state governmental mandate contained 15 3 in an amendment of the senator or representative. 15 4 Sec. 11. NEW SECTION. 25C.11 ASSISTANCE TO COMMITTEES 15 5 AND STUDIES. 15 6 1. At the request of any standing committee of the senate 15 7 or the house of representatives, the director shall, to the 15 8 extent practicable, consult with and assist the committee in 15 9 analyzing the budgetary or financial impact of any proposed 15 10 legislation that may have one or more of the following: 15 11 a. A significant budgetary impact on local governments. 15 12 b. A significant financial impact on the private sector. 15 13 c. A significant employment impact on the private sector. 15 14 2. The director shall conduct continuing studies to 15 15 enhance comparisons of budget outlays, credit authority, and 15 16 tax expenditures. 15 17 3. a. At the request of any chairperson or ranking member 15 18 of the minority of a standing committee of the senate or the 15 19 house of representatives, the director shall, to the extent 15 20 practicable, conduct a study of a legislative proposal 15 21 containing a state mandate. 15 22 b. In conducting a study on state governmental mandates 15 23 under paragraph "a", the director shall do all of the 15 24 following: 15 25 (1) Solicit and consider information or comments from 15 26 elected officials, including their designated representatives, 15 27 of local governments as may provide helpful information or 15 28 comments. 15 29 (2) Consider establishing advisory panels of elected 15 30 officials, or their designated representatives, of local 15 31 governments if the director determines that the advisory 15 32 panels would be helpful in performing responsibilities of the 15 33 director under this section. 15 34 (3) To the extent that the director determines that 15 35 accurate estimates are reasonably feasible, include estimates 16 1 of the following: 16 2 (a) The future direct costs of the state mandate to the 16 3 extent that the costs significantly differ from or extend 16 4 beyond the five-year period after the state mandate is first 16 5 effective. 16 6 (b) Any disproportionate budgetary effects of state 16 7 mandates upon particular industries or sectors of the economy, 16 8 and urban or rural or other types of communities, as 16 9 appropriate. 16 10 c. In conducting a study on private sector mandates under 16 11 paragraph "a", the director shall provide estimates, to the 16 12 extent that the director determines that the estimates are 16 13 reasonably feasible, of the following: 16 14 (1) Future costs of private sector mandates to the extent 16 15 that the private sector mandates differ significantly from or 16 16 extend beyond the five-year time period referred to in 16 17 paragraph "b", subparagraph (3), subparagraph subdivision (a). 16 18 (2) Any disproportionate financial effects of private 16 19 sector mandates and of any state financial assistance in the 16 20 bill or joint resolution upon any particular industries or 16 21 sectors of the economy, and urban or rural or other types of 16 22 communities, as appropriate. 16 23 (3) The effect of private sector mandates in the bill or 16 24 joint resolution on the state economy, including the effect on 16 25 productivity, economic growth, full employment, creation of 16 26 productive jobs, and international competitiveness of goods 16 27 and services. 16 28 Sec. 12. NEW SECTION. 25C.12 COST OF ADMINISTRATIVE 16 29 RULES. 16 30 1. It is the intent of the general assembly that state 16 31 agencies should review and evaluate planned rules to ensure 16 32 that the cost estimates provided by the legislative fiscal 16 33 bureau will be carefully considered as rules are adopted. 16 34 2. At the request of the committee chairperson or ranking 16 35 minority member, the director shall, to the extent 17 1 practicable, prepare a comparison between an estimate by the 17 2 relevant state agency, prepared under section 25C.14, of the 17 3 costs of rules implementing an Act containing a state mandate 17 4 and the cost estimate prepared by the legislative fiscal 17 5 bureau for the Act when it was enacted by the general 17 6 assembly. 17 7 3. At the request of the director of the legislative 17 8 fiscal bureau, the director of the department of management 17 9 shall provide data and cost estimates for rules implementing 17 10 an Act containing a state mandate. 17 11 Sec. 13. NEW SECTION. 25C.13 FUNDING FOR PRIOR 17 12 COMPLIANCE. 17 13 This chapter shall not preclude a local government that 17 14 already complies with all or part of the state governmental 17 15 mandates included in a bill, joint resolution, amendment, 17 16 motion, or conference committee report from consideration for 17 17 state funding under section 25C.8, subsection 1, paragraph 17 18 "b", for the cost of the state governmental mandate, including 17 19 the costs the local government is currently paying and any 17 20 additional costs necessary to meet the state governmental 17 21 mandate. 17 22 Sec. 14. NEW SECTION. 25C.14 REGULATORY STATEMENTS. 17 23 1. Unless otherwise prohibited by law, before publishing 17 24 any general notice of proposed rulemaking that is likely to 17 25 result in adoption of any rule that includes any state mandate 17 26 that may result in the expenditure by local governments, in 17 27 the aggregate, or by the private sector, of one hundred 17 28 thousand dollars or more in any one year, and before adopting 17 29 any final rule for which a general notice of proposed 17 30 rulemaking was published, a state agency shall prepare a 17 31 written statement containing the following: 17 32 a. An identification of the provision of state law under 17 33 which the rule is being adopted. 17 34 b. A qualitative and quantitative assessment of the 17 35 anticipated costs and benefits of the state mandate, including 18 1 the costs and benefits to local governments or the private 18 2 sector, as well as the effect of the state mandate on health, 18 3 safety, and the natural environment and the assessment shall 18 4 include the following: 18 5 (1) An analysis of the extent to which the costs to local 18 6 governments may be paid with state financial assistance. 18 7 (2) The extent to which there are available state 18 8 resources to carry out the state mandate. 18 9 c. Estimates by the state agency, to the extent that the 18 10 agency determines that accurate estimates are reasonably 18 11 feasible, of the following: 18 12 (1) The future compliance costs of the state mandate. 18 13 (2) Any disproportionate budgetary effects of the state 18 14 mandate upon any particular local governments, urban or rural 18 15 or other types of communities, or particular segments of the 18 16 private sector. 18 17 d. Estimates by the state agency of the effect on the 18 18 state economy, such as the effect on productivity, economic 18 19 growth, full employment, creation of productive jobs, and 18 20 international competitiveness of goods and services, to the 18 21 extent that the state agency in its sole discretion determines 18 22 that accurate estimates are reasonably feasible and that the 18 23 effect is relevant and material. 18 24 e. A description of the extent of the state agency's prior 18 25 consultation with elected representatives pursuant to section 18 26 25C.16 of the affected local governments. 18 27 f. A summary of the comments and concerns that were 18 28 presented by local governments either orally or in writing to 18 29 the state agency. 18 30 g. A summary of the state agency's evaluation of those 18 31 comments and concerns. 18 32 2. In publishing a general notice of proposed rulemaking 18 33 or a final rule for which a statement under subsection 1 is 18 34 required, the state agency shall include in the publication a 18 35 summary of the information contained in the statement. 19 1 3. A state agency may prepare a statement required under 19 2 subsection 1 in conjunction with or as a part of any other 19 3 statement or analysis, provided that the statement or analysis 19 4 satisfies the provisions of subsection 1. 19 5 Sec. 15. NEW SECTION. 25C.15 SMALL GOVERNMENT PLAN. 19 6 1. Before establishing any regulatory requirements that 19 7 might significantly or uniquely affect small governments, 19 8 state agencies shall have developed a plan under which the 19 9 state agency shall do all of the following: 19 10 a. Provide notice of the requirements to potentially 19 11 affected small governments. 19 12 b. Enable officials of affected small governments to 19 13 provide meaningful and timely input in the development of 19 14 regulatory proposals containing significant state governmental 19 15 mandates. 19 16 c. Inform, educate, and advise small governments on 19 17 compliance with the requirements. 19 18 2. There are appropriated from the general fund of the 19 19 state to each state agency to carry out the provisions of this 19 20 section and for no other purpose, such sums as are necessary. 19 21 Sec. 16. NEW SECTION. 25C.16 LOCAL GOVERNMENT INPUT. 19 22 1. Each state agency shall, to the extent permitted in 19 23 law, develop an effective process to permit elected officers 19 24 of governments or their designated employees with authority to 19 25 act on their behalf to provide meaningful and timely input in 19 26 the development of regulatory proposals containing significant 19 27 state governmental mandates. 19 28 2. No later than six months after the date of enactment of 19 29 this Act, the governor shall issue guidelines and instructions 19 30 to state agencies for appropriate implementation of subsection 19 31 1 consistent with applicable laws and rules. 19 32 Sec. 17. NEW SECTION. 25C.17 LEAST BURDENSOME OPTION. 19 33 1. Except as provided in subsection 2, before adopting any 19 34 rule for which a written statement is required under section 19 35 25C.14, the state agency shall identify and consider a 20 1 reasonable number of regulatory alternatives and from those 20 2 alternatives select the least costly, most cost-effective or 20 3 least burdensome alternative that achieves the objectives of 20 4 the rule, for: 20 5 a. Local governments, in the case of a rule containing a 20 6 state governmental mandate. 20 7 b. The private sector, in the case of a rule containing a 20 8 private sector mandate. 20 9 2. The provisions of subsection 1 shall apply unless one 20 10 of the following occurs: 20 11 a. The head of the affected state agency publishes with 20 12 the final rule an explanation of why the least costly, most 20 13 cost-effective or least burdensome method of achieving the 20 14 objectives of the rule was not adopted. 20 15 b. The provisions are inconsistent with the law. 20 16 3. No later than one year after the date of the enactment 20 17 of this Act, the director of the department of management 20 18 shall certify to the general assembly, with a written 20 19 explanation, state agency compliance with this section and 20 20 include in that certification state agencies and rulemakings 20 21 that fail to adequately comply with this section. 20 22 Sec. 18. NEW SECTION. 25C.18 ASSISTANCE TO LEGISLATIVE 20 23 FISCAL BUREAU. 20 24 The director of the department of management shall collect 20 25 from agencies the statements prepared under section 25C.14 and 20 26 periodically forward copies of the statements to the director 20 27 of the legislative fiscal bureau on a reasonably timely basis 20 28 after publication of the general notice of proposed rulemaking 20 29 or of the final rule for which the statement was prepared. 20 30 Sec. 19. NEW SECTION. 25C.19 PILOT PROGRAM FOR SMALL 20 31 GOVERNMENTS. 20 32 1. The director of the department of management, in 20 33 consultation with state agencies, shall establish pilot 20 34 programs in at least two state agencies to test innovative and 20 35 more flexible regulatory approaches that reduce reporting and 21 1 compliance burdens on small governments and meet overall 21 2 statutory goals and objectives. 21 3 2. The pilot programs shall focus on rules in effect or 21 4 proposed rules, or a combination of those rules. 21 5 Sec. 20. NEW SECTION. 25C.20 ANNUAL STATEMENTS ON AGENCY 21 6 COMPLIANCE. 21 7 No later than one year after the effective date of this Act 21 8 and annually thereafter, the director of the department of 21 9 management shall submit to the general assembly, including the 21 10 committees on state government of the senate and the house of 21 11 representatives, a written report detailing compliance by each 21 12 state agency during the preceding reporting period with the 21 13 requirements of this chapter. 21 14 Sec. 21. Section 2B.10, subsection 7, Code 1995, is 21 15 amended to read as follows: 21 16 7. A notation of the filing of an estimate of a state 21 17 mandate prepared by the legislative fiscal bureau pursuant to 21 18 section25B.525C.11 shall be included in the session laws 21 19 with the text of an enacted bill or joint resolution 21 20 containing the state mandate. 21 21 Sec. 22. REPEAL. Chapter 25B, Code 1995, is repealed. 21 22 EXPLANATION 21 23 This bill establishes procedures for the general assembly, 21 24 the legislative fiscal bureau, the department of management, 21 25 and state agencies to reduce the imposition of state mandates 21 26 on political subdivisions and the private sector and to 21 27 curtail state mandates without adequate funding. The bill 21 28 defines state governmental mandate, private sector mandate, 21 29 small government, direct cost, direct savings, local 21 30 government, and related terms. The bill provides specific 21 31 exclusions such as legislation to protect civil rights, 21 32 provide emergency relief, and enforce constitutional rights 21 33 from state mandate procedures. 21 34 Procedures are specified for legislation containing state 21 35 mandates in legislative committees and before the houses of 22 1 the general assembly. Duties are also provided for the 22 2 legislative fiscal bureau and the department of management 22 3 relating to determining costs and savings and providing for 22 4 the implementation of proposed rules. 22 5 The bill also provides procedures in the rulemaking process 22 6 so that appropriate costs can be evaluated and paid to 22 7 political subdivisions. An appropriation is made to state 22 8 agencies to enable them to assist small governments. 22 9 LSB 3440XS 76 22 10 tj/jj/8.1
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