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Text: HSB00229                          Text: HSB00231
Text: HSB00200 - HSB00299               Text: HSB Index
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House Study Bill 230

Bill Text

PAG LIN
  1  1    Section 1.  Section 10A.101, subsection 1, Code 1997, is
  1  2 amended to read as follows:
  1  3    1.  "Administrator" means the chief administrative law
  1  4 judge, chief inspector, chief investigator, chief auditor, or
  1  5 the person administering a division of the department.
  1  6    Sec. 2.  Section 10A.104, subsection 2, Code 1997, is
  1  7 amended to read as follows:
  1  8    2.  Appoint the administrators of the divisions within the
  1  9 department and all other personnel deemed necessary for the
  1 10 administration of this chapter, except the state public
  1 11 defender, assistant state public defenders, administrator of
  1 12 the racing and gaming commission, members of the employment
  1 13 appeal board, the chief administrative law judge,
  1 14 administrative law judges, and administrator of the state
  1 15 citizen foster care review board.  All persons appointed and
  1 16 employed in the department are covered by the provisions of
  1 17 chapter 19A, but persons not appointed by the director are
  1 18 exempt from the merit system provisions of chapter 19A, except
  1 19 as provided in section 10A.801.
  1 20    Sec. 3.  Section 10A.104, subsection 5, Code 1997, is
  1 21 amended to read as follows:
  1 22    5.  Adopt rules deemed necessary for the implementation and
  1 23 administration of this chapter in accordance with chapter 17A,
  1 24 including rules governing hearing and appeal proceedings.
  1 25    Sec. 4.  Section 10A.106, Code 1997, is amended to read as
  1 26 follows:
  1 27    10A.106  DIVISIONS OF THE DEPARTMENT.
  1 28    The department is comprised of the following divisions:
  1 29    1.  Appeals and fair hearings division.
  1 30    2. 1.  Audits division.
  1 31    3. 2.  Investigations division.
  1 32    4. 3.  Inspections division.
  1 33    The allocation of departmental duties to the divisions of
  1 34 the department in sections 10A.202, 10A.302, 10A.402, and
  1 35 10A.502 does not prohibit the director from reallocating
  2  1 departmental duties within the department.  The director shall
  2  2 not reallocate any of the duties of the office of
  2  3 administrative hearings, created by section 10A.801, to any
  2  4 other unit of the department.
  2  5    Sec. 5.  NEW SECTION.  10A.801  OFFICE OF ADMINISTRATIVE
  2  6 HEARINGS – CREATION, POWERS, DUTIES.
  2  7    1.  An independent office of administrative hearings within
  2  8 the department is created to be headed and administered by a
  2  9 chief administrative law judge appointed by the governor for a
  2 10 term of six years subject to confirmation by the senate.  The
  2 11 chief administrative law judge may be removed by the governor
  2 12 at any time for good cause.
  2 13    2.  a.  The chief administrative law judge shall employ a
  2 14 sufficient number of administrative law judges to conduct
  2 15 proceedings for which agencies are required, by section 17A.11
  2 16 or any other provision of law, to use an administrative law
  2 17 judge employed by the office.  An administrative law judge
  2 18 employed by the office shall not perform duties inconsistent
  2 19 with the judge's duties and responsibilities as an
  2 20 administrative law judge and shall be located in an office
  2 21 that is entirely separated from the offices of the agencies
  2 22 for which that person acts as a presiding officer.
  2 23 Administrative law judges shall be covered by the merit system
  2 24 provisions of chapter 19A.
  2 25    b.  Subject to the approval of the department of personnel,
  2 26 the office shall, insofar as practicable, provide for
  2 27 different classes of administrative law judges with different
  2 28 salary scales.  The office shall also facilitate, insofar as
  2 29 practicable, specialization by its administrative law judges
  2 30 so that particular judges may become expert in presiding over
  2 31 cases in particular agencies.  An agency may, by rule,
  2 32 identify particular classes of its contested cases for which
  2 33 the administrative law judge who acts as presiding officer
  2 34 shall have specified technical expertness.  After the adoption
  2 35 of such a rule, the office may assign administrative law
  3  1 judges to preside over those identified particular classes of
  3  2 contested cases only if the agency responsible for those cases
  3  3 has certified, either at the time of the initial hiring of the
  3  4 administrative law judge by the office or at a subsequent
  3  5 time, that the agency was satisfied that the particular
  3  6 administrative law judge designated to preside possessed the
  3  7 necessary technical expertness.
  3  8    3.  If the office cannot furnish one of its administrative
  3  9 law judges in response to an agency request, the chief
  3 10 administrative law judge shall designate in writing a full-
  3 11 time employee of an agency other than the requesting agency to
  3 12 serve as administrative law judge for the proceeding, but only
  3 13 with the consent of the employing agency.  The designee must
  3 14 possess the same qualifications required of administrative law
  3 15 judges employed by the office.
  3 16    4.  The office may furnish administrative law judges on a
  3 17 contract basis to any governmental entity to conduct any
  3 18 proceeding.
  3 19    5.  After the effective date of this Act, a person shall
  3 20 not be newly employed by the office as an administrative law
  3 21 judge to preside over contested case proceedings unless that
  3 22 person has a license to practice law in this state.
  3 23    6.  The office shall adopt rules pursuant to this chapter
  3 24 and chapter 17A to do all of the following:
  3 25    a.  To establish qualifications for administrative law
  3 26 judges employed by the office, and, subject to the approval of
  3 27 the department of personnel, procedures by which candidates
  3 28 for a position as an administrative law judge in the office
  3 29 will be considered for employment and the manner in which
  3 30 public notice of vacancies for positions as administrative
  3 31 laws judges in the office will be given.
  3 32    b.  To establish procedures for agencies to request and for
  3 33 the chief administrative law judge to assign administrative
  3 34 law judges employed by the office.
  3 35    c.  To establish procedures and adopt forms, consistent
  4  1 with chapter 17A and other provisions of law, to govern
  4  2 administrative law judges employed by the office, but any
  4  3 rules adopted under this paragraph shall be applicable to a
  4  4 particular contested case proceeding only to the extent that
  4  5 they are not inconsistent with the rules of the agency under
  4  6 whose authority that proceeding is conducted.  Nothing in this
  4  7 paragraph precludes an agency from establishing procedural
  4  8 requirements otherwise within its authority to govern its
  4  9 contested case proceedings, including requirements with
  4 10 respect to the timeliness of decisions rendered for it by
  4 11 administrative law judges.
  4 12    d.  To establish standards and procedures for the
  4 13 evaluation, training, promotion, and discipline by the office
  4 14 of administrative law judges employed by the office.  Those
  4 15 procedures shall include provisions for each agency for whom a
  4 16 particular administrative law judge presides to submit to the
  4 17 office on a periodic basis the agency's views with respect to
  4 18 the performance of that administrative law judge or the need
  4 19 for specified additional training for that administrative law
  4 20 judge.  However, the evaluation, training, promotion, and
  4 21 discipline of all administrative law judges employed by the
  4 22 office shall remain solely within the authority of the office.
  4 23    e.  To establish, consistent with the provisions of this
  4 24 section and chapter 17A, a code of administrative judicial
  4 25 conduct that is similar in function and substantially
  4 26 equivalent to the Iowa code of judicial conduct, to govern the
  4 27 actions of all persons who act as presiding officers under the
  4 28 authority of section 17A.11, subsection 1.
  4 29    f.  To facilitate the performance of the responsibilities
  4 30 conferred upon the office by this section, chapter 17A, and
  4 31 any other provision of law.
  4 32    7.  The office may do all of the following:
  4 33    a.  Provide administrative law judges, upon request, to any
  4 34 agency that is required to or wishes to utilize the services
  4 35 of an administrative law judge employed by the office.
  5  1    b.  Maintain a staff of reporters and other personnel.
  5  2    c.  Administer the provisions of this section and rules
  5  3 adopted under its authority.
  5  4    8.  The office may charge agencies for services rendered
  5  5 and the payment received shall be considered repayment
  5  6 receipts as defined in section 8.2.
  5  7    9.  Except to the extent specified otherwise by statute,
  5  8 decisions of administrative law judges employed by the office
  5  9 are subject to review by the agencies for which they act as
  5 10 presiding officers as provided by section 17A.15 or any other
  5 11 provision of law.
  5 12    Sec. 6.  Section 17A.2, Code 1997, is amended by adding the
  5 13 following new subsection:
  5 14    NEW SUBSECTION.  9A.  "Provision of law" means the whole or
  5 15 part of the Constitution of the United States of America or
  5 16 the Constitution of the State of Iowa, or of any federal or
  5 17 state statute, court rule, executive order of the governor, or
  5 18 agency rule.
  5 19    Sec. 7.  Section 17A.2, subsection 10, unnumbered paragraph
  5 20 1, Code 1997, is amended to read as follows:
  5 21    "Rule" means each agency statement of general applicability
  5 22 that implements, interprets, or prescribes law or policy, or
  5 23 that describes the organization, procedure, or practice
  5 24 requirements of any agency.  Notwithstanding any other
  5 25 provision of law statute, the term includes an executive order
  5 26 or directive of the governor which creates an agency or
  5 27 establishes a program or which transfers a program between
  5 28 agencies established by statute or rule.  The term includes
  5 29 the amendment or repeal of an existing rule, but does not
  5 30 include:
  5 31    Sec. 8.  Section 17A.2, subsection 10, paragraph b, Code
  5 32 1997, is amended to read as follows:
  5 33    b.  A declaratory ruling order issued pursuant to section
  5 34 17A.9, or an interpretation issued by an agency with respect
  5 35 to a specific set of facts and intended to apply only to that
  6  1 specific set of facts.
  6  2    Sec. 9.  Section 17A.3, subsection 1, Code 1997, is amended
  6  3 by adding the following new paragraph after paragraph b and
  6  4 relettering the subsequent paragraphs:
  6  5    NEW PARAGRAPH.  c.  As soon as feasible and to the extent
  6  6 practicable, adopt rules, in addition to those otherwise
  6  7 required by this chapter, embodying appropriate standards,
  6  8 principles, and procedural safeguards that the agency will
  6  9 apply to the law it administers.
  6 10    Sec. 10.  Section 17A.4, subsection 1, paragraph b, Code
  6 11 1997, is amended to read as follows:
  6 12    b.  Afford all interested persons not less than twenty days
  6 13 to submit data, views, or arguments in writing.  If timely
  6 14 requested in writing by twenty-five interested persons, by a
  6 15 governmental subdivision, by the administrative rules review
  6 16 committee, by an agency, or by an association having not less
  6 17 than twenty-five members, the agency must give interested
  6 18 persons an opportunity to make oral presentation.  The
  6 19 opportunity for oral presentation must be held at least twenty
  6 20 days after publication of the notice of its time and place in
  6 21 the Iowa administrative bulletin.  The agency shall consider
  6 22 fully all written and oral submissions respecting the proposed
  6 23 rule.  Within one hundred eighty days following either the
  6 24 notice published according to the provisions of paragraph "a"
  6 25 or within one hundred eighty days after the last date of the
  6 26 oral presentations on the proposed rule, whichever is later,
  6 27 the agency shall adopt a rule pursuant to the rulemaking
  6 28 proceeding or shall terminate the proceeding by publishing
  6 29 notice of termination in the Iowa administrative bulletin.  If
  6 30    An agency shall include in a preamble to each rule it
  6 31 adopts a brief explanation of the principal reasons for its
  6 32 action and, if applicable, a brief explanation of the
  6 33 principal reasons for its failure to provide in that rule for
  6 34 the waiver of the rule in specified situations if no such
  6 35 waiver provision is included in the rule.  This explanatory
  7  1 requirement does not apply when the agency adopts a rule that
  7  2 only defines the meaning of a provision of law if the agency
  7  3 does not possess delegated authority to bind the courts to any
  7  4 extent with its definition.  In addition, if requested to do
  7  5 so by an interested person, either prior to adoption or within
  7  6 thirty days thereafter, the agency shall issue a concise
  7  7 statement of the principal reasons for and against the rule it
  7  8 adopted, incorporating therein the reasons for overruling
  7  9 considerations urged against the rule.  This concise statement
  7 10 shall be issued either at the time of the adoption of the rule
  7 11 or within thirty-five days after the agency receives the
  7 12 request.
  7 13    Sec. 11.  Section 17A.4, subsection 1, paragraph c, Code
  7 14 1997, is amended by striking the paragraph.
  7 15    Sec. 12.  NEW SECTION.  17A.4A  REGULATORY ANALYSIS.
  7 16    1.  An agency shall issue a regulatory analysis of a
  7 17 proposed rule that complies with subsection 2, paragraph "a",
  7 18 if, within thirty-two days after the published notice of
  7 19 proposed rule adoption, a written request for the analysis is
  7 20 submitted to the agency by the administrative rules review
  7 21 committee or the administrative rules coordinator.  An agency
  7 22 shall issue a regulatory analysis of a proposed rule that
  7 23 complies with subsection 2, paragraph "b", if the rule would
  7 24 have a substantial impact on small business and if, within
  7 25 thirty-two days after the published notice of proposed rule
  7 26 adoption, a written request for analysis is submitted to the
  7 27 agency by the administrative rules review committee, the
  7 28 administrative rules coordinator, at least twenty-five persons
  7 29 signing that request who each qualify as a small business or
  7 30 by an organization representing at least twenty-five such
  7 31 persons.  If a rule has been adopted without prior notice and
  7 32 an opportunity for public participation in reliance upon
  7 33 section 17A.4, subsection 2, the written request for an
  7 34 analysis that complies with subsection 2, paragraph "a" or
  7 35 "b", may be made within seventy days of publication of the
  8  1 rule.
  8  2    2.  a.  Except to the extent that a written request for a
  8  3 regulatory analysis expressly waives one or more of the
  8  4 following, the regulatory analysis must contain all of the
  8  5 following:
  8  6    (1)  A description of the classes of persons who probably
  8  7 will be affected by the proposed rule, including classes that
  8  8 will bear the costs of the proposed rule and classes that will
  8  9 benefit from the proposed rule.
  8 10    (2)  A description of the probable quantitative and
  8 11 qualitative impact of the proposed rule, economic or
  8 12 otherwise, upon affected classes of persons, including a
  8 13 description of the nature and amount of all of the different
  8 14 kinds of costs that would be incurred in complying with the
  8 15 proposed rule.
  8 16    (3)  The probable costs to the agency and to any other
  8 17 agency of the implementation and enforcement of the proposed
  8 18 rule and any anticipated effect on state revenues.
  8 19    (4)  A comparison of the probable costs and benefits of the
  8 20 proposed rule to the probable costs and benefits of inaction.
  8 21    (5)  A determination of whether less costly methods or less
  8 22 intrusive methods exist for achieving the purpose of the
  8 23 proposed rule.
  8 24    (6)  A description of any alternative methods for achieving
  8 25 the purpose of the proposed rule that were seriously
  8 26 considered by the agency and the reasons why they were
  8 27 rejected in favor of the proposed rule.
  8 28    b.  In the case of a rule that would have a substantial
  8 29 impact on small business, the regulatory analysis must contain
  8 30 a discussion of whether it would be feasible and practicable
  8 31 to do any of the following to reduce the impact of the rule on
  8 32 small business:
  8 33    (1)  Establish less stringent compliance or reporting
  8 34 requirements in the rule for small business.
  8 35    (2)  Establish less stringent schedules or deadlines in the
  9  1 rule for compliance or reporting requirements for small
  9  2 business.
  9  3    (3)  Consolidate or simplify the rule's compliance or
  9  4 reporting requirements for small business.
  9  5    (4)  Establish performance standards to replace design or
  9  6 operational standards in the rule for small business.
  9  7    (5)  Exempt small business from any or all requirements of
  9  8 the rule.
  9  9    c.  The agency shall reduce the impact of a proposed rule
  9 10 that would have a substantial impact on small business by
  9 11 using a method discussed in paragraph "b" if the agency finds
  9 12 that the method is legal and feasible in meeting the statutory
  9 13 objectives which are the basis of the proposed rule.
  9 14    3.  Each regulatory analysis must include quantifications
  9 15 of the data to the extent practicable and must take account of
  9 16 both short-term and long-term consequences.
  9 17    4.  Upon receipt by an agency of a timely request for a
  9 18 regulatory analysis, the agency shall extend the period
  9 19 specified in this chapter for each of the following until at
  9 20 least twenty days after publication in the administrative
  9 21 bulletin of a concise summary of the regulatory analysis:
  9 22    a.  The end of the period during which persons may make
  9 23 written submissions on the proposed rule.
  9 24    b.  The end of the period during which an oral proceeding
  9 25 may be requested.
  9 26    c.  The date of any required oral proceeding on the
  9 27 proposed rule.
  9 28    In the case of a rule adopted without prior notice and an
  9 29 opportunity for public participation in reliance upon section
  9 30 17A.4, subsection 2, the summary must be published within
  9 31 seventy days of the request.
  9 32    5.  The published summary of the regulatory analysis must
  9 33 also indicate where persons may obtain copies of the full text
  9 34 of the regulatory analysis and where, when, and how persons
  9 35 may present their views on the proposed rule and demand an
 10  1 oral proceeding thereon if one is not already provided.
 10  2    6.  If the agency has made a good faith effort to comply
 10  3 with the requirements of subsections 1 through 3, the rule may
 10  4 not be invalidated on the ground that the contents of the
 10  5 regulatory analysis are insufficient or inaccurate.
 10  6    7.  For the purpose of this section, "small business" means
 10  7 any entity including but not limited to an individual,
 10  8 partnership, corporation, joint venture, association, or
 10  9 cooperative, to which all of the following apply:
 10 10    a.  It is not an affiliate or subsidiary of an entity
 10 11 dominant in its field of operation.
 10 12    b.  It has either twenty or fewer full-time equivalent
 10 13 positions or less than one million dollars in annual gross
 10 14 revenues in the preceding fiscal year.
 10 15    For purposes of this definition, "dominant in its field of
 10 16 operation" means having more than twenty full-time equivalent
 10 17 positions and more than one million dollars in annual gross
 10 18 revenues, and "affiliate or subsidiary of an entity dominant
 10 19 in its field of operation" means an entity which is at least
 10 20 twenty percent owned by an entity dominant in its field of
 10 21 operation, or by partners, officers, directors, majority
 10 22 stockholders, or their equivalent, of an entity dominant in
 10 23 that field of operation.
 10 24    Sec. 13.  Section 17A.7, Code 1997, is amended to read as
 10 25 follows:
 10 26    17A.7  PETITION FOR ADOPTION OF RULES AND REQUEST FOR
 10 27 REVIEW OF RULES.
 10 28    1.  An interested person may petition an agency requesting
 10 29 the promulgation adoption, amendment, or repeal of a rule.
 10 30 Each agency shall prescribe by rule the form for petitions and
 10 31 the procedure for their submission, consideration, and
 10 32 disposition.  Within sixty days after submission of a
 10 33 petition, the agency either shall deny the petition in writing
 10 34 on the merits, stating its reasons for the denial, or initiate
 10 35 rulemaking proceedings in accordance with section 17A.4, or
 11  1 issue a rule if it is not required to be issued according to
 11  2 the procedures of section 17A.4, subsection 1.
 11  3    2.  The administrative rules review committee, the
 11  4 administrative rules coordinator, a political subdivision, an
 11  5 agency, twenty-five persons signing one request, or an
 11  6 association having not less than twenty-five members, may
 11  7 request an agency to conduct a formal review of a specified
 11  8 rule of that agency to determine whether the rule should be
 11  9 repealed or amended or a new rule adopted instead.
 11 10    If the agency has not conducted such a review of the
 11 11 specified rule within a period of five years prior to the
 11 12 filing with the agency of that written request, the agency
 11 13 shall prepare within a reasonable time a written report with
 11 14 respect to the rule summarizing the agency's findings, its
 11 15 supporting reasons, and any proposed course of action.  The
 11 16 report must include, for the specified rule, a concise
 11 17 statement of all of the following:
 11 18    a.  The rule's effectiveness in achieving its objectives,
 11 19 including a summary of any available data supporting the
 11 20 conclusions reached.
 11 21    b.  Written criticisms of the rule received during the
 11 22 previous five years, including a summary of any petitions for
 11 23 waiver of the rule tendered to the agency or granted by the
 11 24 agency.
 11 25    c.  Alternative solutions regarding the subject matter of
 11 26 the criticisms and the reasons they were rejected or the
 11 27 changes made in the rule in response to those criticisms and
 11 28 the reasons for the changes.
 11 29    A copy of the report shall be sent to the administrative
 11 30 rules review committee and the administrative rules
 11 31 coordinator and shall be made available for public inspection.
 11 32    Sec. 14.  Section 17A.9, Code 1997, is amended by striking
 11 33 the section and inserting in lieu thereof the following:
 11 34    17A.9  DECLARATORY ORDERS.
 11 35    1.  Any person may petition an agency for a declaratory
 12  1 order as to the applicability to specified circumstances of a
 12  2 statute, rule, or order within the primary jurisdiction of the
 12  3 agency.  An agency shall issue a declaratory order in response
 12  4 to a petition for that order unless the agency determines that
 12  5 issuance of the order under the circumstances would be
 12  6 contrary to a rule adopted in accordance with subsection 2.
 12  7    However, an agency shall not issue a declaratory order that
 12  8 would substantially prejudice the rights of a person who would
 12  9 be a necessary party and who does not consent in writing to
 12 10 the determination of the matter by a declaratory order
 12 11 proceeding.
 12 12    2.  Each agency shall adopt rules that provide for the
 12 13 form, contents, and filing of petitions for declaratory
 12 14 orders, the procedural rights of persons in relation to the
 12 15 petitions, and the disposition of the petitions.  The rules
 12 16 must describe the classes of circumstances in which the agency
 12 17 will not issue a declaratory order and must be consistent with
 12 18 the public interest and with the general policy of this
 12 19 chapter to facilitate and encourage agency issuance of
 12 20 reliable advice.
 12 21    3.  Within fifteen days after receipt of a petition for a
 12 22 declaratory order, an agency shall give notice of the petition
 12 23 to all persons to whom notice is required by any provision of
 12 24 law and may give notice to any other persons.
 12 25    4.  Persons who qualify under any applicable provision of
 12 26 law as an intervenor and who file timely petitions for
 12 27 intervention according to agency rules may intervene in
 12 28 proceedings for declaratory orders.  The provisions of
 12 29 sections 17A.10 through 17A.18 apply to agency proceedings for
 12 30 declaratory orders only to the extent an agency so provides by
 12 31 rule or order.
 12 32    5.  Within thirty days after receipt of a petition for a
 12 33 declaratory order, an agency, in writing, shall do one of the
 12 34 following:
 12 35    a.  Issue an order declaring the applicability of the
 13  1 statute, rule, or order in question to the specified
 13  2 circumstances.
 13  3    b.  Set the matter for specified proceedings.
 13  4    c.  Agree to issue a declaratory order by a specified time.
 13  5    d.  Decline to issue a declaratory order, stating the
 13  6 reasons for its action.
 13  7    6.  A copy of all orders issued in response to a petition
 13  8 for a declaratory order must be mailed promptly to the
 13  9 petitioner and any other parties.
 13 10    7.  A declaratory order has the same status and binding
 13 11 effect as any other order issued in a contested case
 13 12 proceeding.  A declaratory order must contain the names of all
 13 13 parties to the proceeding on which it is based, the particular
 13 14 facts on which it is based, and the reasons for its
 13 15 conclusion.
 13 16    8.  If an agency has not issued a declaratory order within
 13 17 sixty days after receipt of a petition therefor, or such later
 13 18 time as agreed by the parties, the petition is deemed to have
 13 19 been denied.  Once a petition for a declaratory order is
 13 20 deemed denied or if the agency declines to issue a declaratory
 13 21 order pursuant to subsection 5, paragraph "d", a party to that
 13 22 proceeding may either seek judicial review or await further
 13 23 agency action with respect to its petition for a declaratory
 13 24 order.
 13 25    Sec. 15.  NEW SECTION.  17A.10A  CONTESTED CASES – NO
 13 26 FACTUAL DISPUTE.
 13 27    Upon petition by a party in a matter that would be a
 13 28 contested case if there was a dispute over the existence of
 13 29 material facts, all of the provisions of this chapter
 13 30 applicable to contested cases, except those relating to
 13 31 presentation of evidence, shall be applicable even though
 13 32 there is no factual dispute in the particular case.
 13 33    Sec. 16.  Section 17A.11, Code 1997, is amended by striking
 13 34 the section and inserting in lieu thereof the following:
 13 35    17A.11  PRESIDING OFFICER, DISQUALIFICATION, SUBSTITUTION.
 14  1    1.  a.  If the agency or an officer of the agency under
 14  2 whose authority the contested case is to take place is a named
 14  3 party to that proceeding or a real party in interest to that
 14  4 proceeding the presiding officer may be, in the discretion of
 14  5 the agency head, either the agency head, one or more members
 14  6 of the agency head, or one or more administrative law judges
 14  7 assigned by the office of administrative hearings in
 14  8 accordance with the provisions of section 10A.801.
 14  9    b.  If the agency or an officer of the agency under whose
 14 10 authority the contested case is to take place is not a named
 14 11 party to that proceeding or a real party in interest to that
 14 12 proceeding the presiding officer may be, in the discretion of
 14 13 the agency head, either the agency head, one or more members
 14 14 of the agency head, an administrative law judge assigned by
 14 15 the office of administrative hearings in accordance with the
 14 16 provisions of section 10A.801, or any other qualified person
 14 17 designated as a presiding officer by the agency head.  Any
 14 18 other person designated as a presiding officer by the agency
 14 19 head may be employed by and officed in the agency for which
 14 20 that person acts as a presiding officer, but such a person
 14 21 shall not perform duties inconsistent with that person's
 14 22 duties and responsibilities as a presiding officer.
 14 23    c.  For purposes of paragraph "a", the office of
 14 24 administrative hearings established in section 10A.801 shall
 14 25 be treated as a wholly separate agency from the department of
 14 26 inspections and appeals.
 14 27    2.  Any person serving or designated to serve alone or with
 14 28 others as a presiding officer is subject to disqualification
 14 29 for bias, prejudice, interest, or any other cause provided in
 14 30 this chapter or for which a judge is or may be disqualified.
 14 31    3.  Any party may timely request the disqualification of a
 14 32 person as a presiding officer by filing a motion supported by
 14 33 an affidavit asserting an appropriate ground for
 14 34 disqualification, after receipt of notice indicating that the
 14 35 person will preside or upon discovering facts establishing
 15  1 grounds for disqualification, whichever is later.
 15  2    4.  A person whose disqualification is requested shall
 15  3 determine whether to grant the request, stating facts and
 15  4 reasons for the determination.
 15  5    5.  If a substitute is required for a person who is
 15  6 disqualified or becomes unavailable for any other reason, the
 15  7 substitute shall be appointed by either of the following:
 15  8    a.  The governor, if the disqualified or unavailable person
 15  9 is an elected official.
 15 10    b.  The appointing authority, if the disqualified or
 15 11 unavailable person is an appointed official.
 15 12    6.  Any action taken by a duly-appointed substitute for a
 15 13 disqualified or unavailable person is as effective as if taken
 15 14 by the latter.
 15 15    Sec. 17.  Section 17A.12, subsection 3, Code 1997, is
 15 16 amended by striking the subsection and inserting in lieu
 15 17 thereof the following:
 15 18    3.  a.  If a party fails to appear or participate in a
 15 19 contested case proceeding, the presiding officer shall serve
 15 20 all parties by certified mail written notice of a proposed
 15 21 default order, including a statement of the grounds.
 15 22    b.  Within fifteen days or such longer period specified by
 15 23 agency rule after the mailing by certified mail of a proposed
 15 24 default order, the party against whom it was issued may file a
 15 25 written motion requesting that the proposed default order be
 15 26 vacated and stating the grounds relied upon.  A proposed
 15 27 default order may be vacated for any reason specified in the
 15 28 rules of civil procedure or for any other reason specified by
 15 29 agency rule.  At the time a party fails to appear or
 15 30 participate in a contested case proceeding, or during the time
 15 31 within which a party may file a written motion under this
 15 32 subsection, the presiding officer may adjourn the proceedings
 15 33 or conduct them without the participation of the party against
 15 34 whom a proposed default order was issued, having due regard
 15 35 for the interests of justice and the orderly and prompt
 16  1 conduct of the proceedings.
 16  2    c.  The presiding officer shall either issue or vacate the
 16  3 default order promptly after expiration of the time within
 16  4 which the party may file a written motion under paragraph "b".
 16  5    d.  After issuing a default order, the presiding officer
 16  6 shall conduct any further proceedings necessary to complete
 16  7 the contested case proceeding without the participation of the
 16  8 party in default and shall determine all issues in the
 16  9 contested case including those affecting the defaulting party.
 16 10    e.  If the presiding officer conducts further proceedings
 16 11 after the issuance of a proposed default order, the time
 16 12 period for seeking judicial review of a decision in that
 16 13 contested case proceeding shall begin to run from the date of
 16 14 the issuance of the final decision in that case, if any, or
 16 15 the date of the issuance of a default order, whichever is
 16 16 later.
 16 17    Sec. 18.  Section 17A.16, subsection 1, Code 1997, is
 16 18 amended to read as follows:
 16 19    1.  A proposed or final decision or order in a contested
 16 20 case shall be in writing or stated in the record.  A proposed
 16 21 or final decision shall include findings of fact and
 16 22 conclusions of law, separately stated.  Findings of fact, if
 16 23 set forth in statutory language, shall be accompanied by a
 16 24 concise and explicit statement of underlying facts supporting
 16 25 the findings.  The decision shall include an explanation of
 16 26 why the evidence in the record supports each finding of fact
 16 27 and why the evidence in the record that is contrary to a
 16 28 finding does not preclude it.  If, in accordance with agency
 16 29 rules, a party submitted proposed findings of fact, the
 16 30 decision shall include a ruling upon each proposed finding.
 16 31 Each conclusion of law shall be supported by cited authority
 16 32 or by a reasoned opinion.  Parties shall be promptly notified
 16 33 of each proposed or final decision or order by the delivery to
 16 34 them of a copy of such decision or order in the manner
 16 35 provided by section 17A.12, subsection 1.
 17  1    Sec. 19.  Section 17A.17, Code 1997, is amended to read as
 17  2 follows:
 17  3    17A.17  EX PARTE COMMUNICATIONS AND SEPARATION OF
 17  4 FUNCTIONS.
 17  5    1.  Unless required for the disposition of ex parte matters
 17  6 specifically authorized by statute, individuals assigned to
 17  7 render a proposed or final decision or to make findings of
 17  8 fact and conclusions of law a presiding officer in a contested
 17  9 case, shall not communicate, directly or indirectly, in
 17 10 connection with any issue of fact or law in that contested
 17 11 case, with any person or party, except upon notice and
 17 12 opportunity for all parties to participate as shall be
 17 13 provided for by agency rules.
 17 14    However, without such notice and opportunity for all
 17 15 parties to participate, individuals assigned to render a
 17 16 proposed or final decision or to make findings of fact and
 17 17 conclusions of law a presiding officer in a contested case may
 17 18 communicate with members of the agency, and may have the aid
 17 19 and advice of persons other than those with a personal
 17 20 interest in, or those engaged in personally investigating,
 17 21 prosecuting or advocating in, either the case under
 17 22 consideration or a pending factually related case involving
 17 23 the same parties so long as those persons do not directly or
 17 24 indirectly communicate to the presiding officer any ex parte
 17 25 communications they have received of a type that the presiding
 17 26 officer would be prohibited from receiving or that furnish,
 17 27 augment, diminish, or modify the evidence in the record.
 17 28    2.  Unless required for the disposition of ex parte matters
 17 29 specifically authorized by statute, parties or their
 17 30 representatives in a contested case and persons with a direct
 17 31 or indirect interest in such a case shall not communicate,
 17 32 directly or indirectly, in connection with any issue of fact
 17 33 or law in that contested case, with individuals assigned to
 17 34 render a proposed or final decision or to make findings of
 17 35 fact and conclusions of law a presiding officer in that
 18  1 contested case, except upon notice and opportunity for all
 18  2 parties to participate as shall be provided for by agency
 18  3 rules.  The agency's rules may require the recipient of a
 18  4 prohibited communication to submit the communication if
 18  5 written or a summary of the communication if oral for
 18  6 inclusion in the record of the proceeding.  As sanctions for
 18  7 violations, the rules may provide for a decision against a
 18  8 party who violates the rules; for censuring, suspending or
 18  9 revoking a privilege to practice before the agency; and for
 18 10 censuring, suspending or dismissing agency personnel.
 18 11    3.  If, before serving as the presiding officer in a
 18 12 contested case, a person receives an ex parte communication
 18 13 relating directly to the merits of the proceeding over which
 18 14 that person subsequently presides, the person, promptly after
 18 15 starting to serve, shall disclose to all parties any material
 18 16 factual information so received and not otherwise disclosed to
 18 17 those parties pursuant to section 17A.13, subsection 2, or
 18 18 through discovery.
 18 19    4.  A presiding officer who receives an ex parte
 18 20 communication in violation of this section shall place on the
 18 21 record of the pending matter all such written communications
 18 22 received, all written responses to the communications, and a
 18 23 memorandum stating the substance of all such oral and other
 18 24 communications received, all responses made, and the identity
 18 25 of each person from whom the presiding officer received a
 18 26 prohibited ex parte communication, and shall advise all
 18 27 parties that these matters have been placed on the record.
 18 28 Any party desiring to rebut the prohibited ex parte
 18 29 communication must be allowed to do so, upon requesting the
 18 30 opportunity for rebuttal within ten days after notice of the
 18 31 communication.
 18 32    5.  If the effect of an ex parte communication received in
 18 33 violation of this section is so prejudicial that it cannot be
 18 34 cured by the procedure in subsection 4, a presiding officer
 18 35 who receives the communication shall be disqualified and the
 19  1 portions of the record pertaining to the communication shall
 19  2 be sealed by protective order.
 19  3    6.  The agency and any party may report any violation of
 19  4 this section to appropriate authorities for any disciplinary
 19  5 proceedings provided by law.  In addition, each agency by rule
 19  6 shall provide for appropriate sanctions, including default,
 19  7 suspending or revoking a privilege to practice before the
 19  8 agency, and censuring, suspending, or dismissing agency
 19  9 personnel, for any violations of this section.
 19 10    7.  A party to a contested case proceeding may file a
 19 11 timely and sufficient affidavit alleging a violation of any
 19 12 provision of this section.  The agency shall determine the
 19 13 matter as part of the record in the case.  When an agency in
 19 14 these circumstances makes such a determination with respect to
 19 15 an agency member, that determination shall be subject to de
 19 16 novo judicial review in any subsequent review proceeding of
 19 17 the case.
 19 18    3.  8.  No An individual who participates in the making of
 19 19 any proposed or final decision in a contested case shall not
 19 20 have personally investigated, prosecuted, or advocated in
 19 21 connection with that case, the specific controversy underlying
 19 22 that case, or another pending factually related contested
 19 23 case, or pending factually related controversy that may
 19 24 culminate in a contested case, involving the same parties.
 19 25 Nor shall any In addition, such an individual shall not be
 19 26 subject to the authority, direction, or discretion of any
 19 27 person who has personally investigated, prosecuted, or
 19 28 advocated in connection with that contested case, the specific
 19 29 controversy underlying that contested case, or a pending
 19 30 factually related contested case or controversy, involving the
 19 31 same parties.  However, this section shall not be construed to
 19 32 preclude a person from serving as a presiding officer solely
 19 33 because that person determined there was probable cause to
 19 34 initiate the proceeding.
 19 35    4.  A party to a contested case proceeding may file a
 20  1 timely and sufficient affidavit asserting disqualification
 20  2 according to the provisions of subsection 3, or asserting
 20  3 personal bias of an individual participating in the making of
 20  4 any proposed or final decision in that case.  The agency shall
 20  5 determine the matter as part of the record in the case.  When
 20  6 an agency in these circumstances makes such a determination
 20  7 with respect to an agency member, that determination shall be
 20  8 subject to de novo judicial review in any subsequent review
 20  9 proceeding of the case.
 20 10    Sec. 20.  Section 17A.18, subsection 3, Code 1997, is
 20 11 amended to read as follows:
 20 12    3.  No revocation, suspension, annulment or withdrawal, in
 20 13 whole or in part, of any license is lawful unless, prior to
 20 14 the institution of agency proceedings, the agency gave
 20 15 written, timely notice by personal service as in civil actions
 20 16 or by restricted certified mail to the licensee of facts or
 20 17 conduct and the provisions provision of law which warrant
 20 18 warrants the intended action, and the licensee was given an
 20 19 opportunity to show, in an evidentiary hearing conducted
 20 20 according to the provisions of this chapter for contested
 20 21 cases, compliance with all lawful requirements for the
 20 22 retention of the license.  If the agency finds that public
 20 23 health, safety or welfare imperatively requires emergency
 20 24 action, and incorporates a finding to that effect in its
 20 25 order, summary suspension of a license may be ordered pending
 20 26 proceedings for revocation or other action.  These proceedings
 20 27 shall be promptly instituted and determined.
 20 28    Sec. 21.  NEW SECTION.  17A.18A  EMERGENCY ADJUDICATIVE
 20 29 PROCEEDINGS.
 20 30    1.  Notwithstanding any other provision of this chapter and
 20 31 to the extent consistent with the Constitution, an agency may
 20 32 use emergency adjudicative proceedings in a situation
 20 33 involving an immediate danger to the public health, safety, or
 20 34 welfare requiring immediate agency action.
 20 35    2.  The agency may take only such action as is necessary to
 21  1 prevent or avoid the immediate danger to the public health,
 21  2 safety, or welfare that justifies use of emergency
 21  3 adjudication.
 21  4    3.  The agency shall issue an order, including a brief
 21  5 statement of findings of fact, conclusions of law, and policy
 21  6 reasons for the decision if it is an exercise of the agency's
 21  7 discretion, to justify the determination of an immediate
 21  8 danger and the agency's decision to take the specific action.
 21  9    4.  The agency shall give such notice as is practicable to
 21 10 persons who are required to comply with the order.  The order
 21 11 is effective when issued.
 21 12    5.  After issuing an order pursuant to this section, the
 21 13 agency shall proceed as quickly as feasible to complete any
 21 14 proceedings that would be required if the matter did not
 21 15 involve an immediate danger.
 21 16    6.  The agency record consists of any documents regarding
 21 17 the matter that were considered or prepared by the agency.
 21 18 The agency shall maintain these documents as its official
 21 19 record.
 21 20    7.  Unless otherwise required by a provision of law, the
 21 21 agency record need not constitute the exclusive basis for
 21 22 agency action in emergency adjudicative proceedings or for
 21 23 judicial review thereof.
 21 24    Sec. 22.  Section 17A.19, subsection 1, Code 1997, is
 21 25 amended to read as follows:
 21 26    1.  A person or party who has exhausted all adequate
 21 27 administrative remedies and who is aggrieved or adversely
 21 28 affected by any final agency action is entitled to judicial
 21 29 review thereof under this chapter.  When agency action is
 21 30 pursuant to rate regulatory powers over public utilities or
 21 31 common carriers and the aggrievement or adverse effect is to
 21 32 the rates or charges of a public utility or common carrier,
 21 33 the agency action shall not be final until all agency remedies
 21 34 have been exhausted and a decision prescribing rates which
 21 35 satisfy the requirements of those provisions of the Code has
 22  1 been rendered.  A preliminary, procedural or intermediate
 22  2 agency action is immediately reviewable if all adequate
 22  3 administrative remedies have been exhausted and review of the
 22  4 final agency action would not provide an adequate remedy.  If
 22  5 a declaratory ruling order has not been rendered within thirty
 22  6 sixty days after the filing of a petition therefor under
 22  7 section 17A.9, or by such later time as agreed by the parties,
 22  8 or if the agency declines to issue such a declaratory ruling
 22  9 order after receipt of a petition therefor, any administrative
 22 10 remedy available under section 17A.9 shall be deemed
 22 11 inadequate or exhausted.
 22 12    Sec. 23.  Section 17A.19, subsection 5, Code 1997, is
 22 13 amended to read as follows:
 22 14    5.  a.  The filing of the petition for review does not
 22 15 itself stay execution or enforcement of any agency action.
 22 16 Upon application the agency or the reviewing court may, in
 22 17 appropriate cases, order such a stay pending the outcome of
 22 18 the judicial review proceedings Unless precluded by law, the
 22 19 agency may grant a stay on appropriate terms or other
 22 20 temporary remedies during the pendency of judicial review.
 22 21    b.  A party may file an interlocutory motion in the
 22 22 reviewing court, during the pendency of judicial review,
 22 23 seeking review of the agency's action on an application for
 22 24 stay or other temporary remedies.
 22 25    c.  If the agency refuses to grant an application for stay
 22 26 or other temporary remedies, or application to the agency for
 22 27 a stay or other temporary remedies is an inadequate remedy,
 22 28 the court may grant relief but only after a consideration and
 22 29 balancing of all of the following factors:
 22 30    (1)  The extent to which the applicant is likely to prevail
 22 31 when the court finally disposes of the matter.
 22 32    (2)  The extent to which the applicant will suffer
 22 33 irreparable injury if relief if not granted.
 22 34    (3)  The extent to which the grant of relief to the
 22 35 applicant will substantially harm other parties to the
 23  1 proceedings.
 23  2    (4)  The extent to which the public interest relied on by
 23  3 the agency is sufficient to justify the agency's action in the
 23  4 circumstances.
 23  5    d.  If the court determines that relief should be granted
 23  6 from the agency's action on an application for stay or other
 23  7 temporary remedies, the court may remand the matter to the
 23  8 agency with directions to deny a stay, to grant a stay on
 23  9 appropriate terms, or to grant other temporary remedies, or
 23 10 the court may issue an order denying a stay, granting a stay
 23 11 on appropriate terms, or granting other temporary remedies.
 23 12    Sec. 24.  Section 17A.19, subsection 8, Code 1997, is
 23 13 amended by striking the subsection and inserting in lieu
 23 14 thereof the following:
 23 15    8.  Except to the extent that this chapter provides
 23 16 otherwise, in suits for judicial review of agency action all
 23 17 of the following apply:
 23 18    a.  The burden of demonstrating the required prejudice and
 23 19 the invalidity of agency action is on the party asserting
 23 20 invalidity.
 23 21    b.  The validity of agency action must be determined in
 23 22 accordance with the standards of review provided in this
 23 23 section, as applied to the agency action at the time that
 23 24 action was taken.
 23 25    9.  The court shall make a separate and distinct ruling on
 23 26 each material issue on which the court's decision is based.
 23 27    10.  The court may affirm the agency action or remand to
 23 28 the agency for further proceedings.  The court shall reverse,
 23 29 modify, or grant other appropriate relief from agency action,
 23 30 equitable or legal and including declaratory relief, if it
 23 31 determines that substantial rights of the person seeking
 23 32 judicial relief have been prejudiced because the agency action
 23 33 is any of the following:
 23 34    a.  Unconstitutional on its face or as applied or is based
 23 35 upon a provision of law that is unconstitutional on its face
 24  1 or as applied.
 24  2    b.  Beyond the authority delegated to the agency by any
 24  3 provision of law or in violation of any provision of law.
 24  4    c.  Based upon an erroneous interpretation of a provision
 24  5 of law whose interpretation has not clearly been vested by a
 24  6 provision of law in the discretion of the agency.
 24  7    d.  Based upon a procedure or decision-making process
 24  8 prohibited by law or was taken without following the
 24  9 prescribed procedure or decision-making process.
 24 10    e.  The product of decision making undertaken by persons
 24 11 who were improperly constituted as a decision-making body,
 24 12 were motivated by an improper purpose, or were subject to
 24 13 disqualification.
 24 14    f.  Based upon a determination of fact clearly vested by a
 24 15 provision of law in the discretion of the agency that is not
 24 16 supported by substantial evidence in the record before the
 24 17 court when that record is viewed as a whole.  For purposes of
 24 18 this paragraph, the following terms have the following
 24 19 meanings:
 24 20    (1)  "Substantial evidence" means the quantity and quality
 24 21 of evidence that would be deemed sufficient by a neutral,
 24 22 detached, and reasonable person, to establish the fact at
 24 23 issue when the consequences resulting from the establishment
 24 24 of that fact are understood to be serious and of great
 24 25 importance.
 24 26    (2)  "Record before the court" means the agency record for
 24 27 judicial review, as defined by this chapter, supplemented by
 24 28 any additional evidence received by the court under the
 24 29 provisions of this chapter.
 24 30    (3)  "When that record is viewed as a whole" means that the
 24 31 adequacy of the evidence in the record before the court to
 24 32 support a particular finding of fact must be judged in light
 24 33 of all the relevant evidence in the record cited by any party
 24 34 that detracts from that finding as well as all of the relevant
 24 35 evidence in the record cited by any party that supports it,
 25  1 including any determinations of veracity by the presiding
 25  2 officer who personally observed the demeanor of the witnesses
 25  3 and the agency's explanation of why the evidence in the record
 25  4 supports its finding of fact and why the evidence in the
 25  5 record that is contrary to its finding does not preclude that
 25  6 finding.
 25  7    g.  Action other than a rule that is inconsistent with a
 25  8 rule of the agency.
 25  9    h.  Action other than a rule that is inconsistent with the
 25 10 agency's prior practice or precedents, unless the agency has
 25 11 justified that inconsistency by stating credible reasons
 25 12 sufficient to indicate a fair and rational basis for the
 25 13 inconsistency.
 25 14    i.  The product of reasoning that is so illogical as to
 25 15 render it wholly irrational.
 25 16    j.  The product of a decision-making process in which the
 25 17 agency did not consider a relevant and important matter
 25 18 relating to the propriety or desirability of the action in
 25 19 question that a rational decision maker in similar
 25 20 circumstances would have considered prior to taking that
 25 21 action.
 25 22    k.  Not required by law and its negative impact on the
 25 23 private rights affected is so grossly disproportionate to the
 25 24 benefits accruing to the public interest from that action that
 25 25 it must necessarily be deemed to lack any foundation in
 25 26 rational agency policy.
 25 27    l.  Based upon an irrational, illogical, or wholly
 25 28 unjustifiable interpretation of a provision of law whose
 25 29 interpretation has clearly been vested by a provision of law
 25 30 in the discretion of the agency.
 25 31    m.  Based upon an irrational, illogical, or wholly
 25 32 unjustifiable application of law to fact that has clearly been
 25 33 vested by a provision of law in the discretion of the agency.
 25 34    n.  Otherwise unreasonable, arbitrary, capricious, or an
 25 35 abuse of discretion.
 26  1    11.  In making the determinations required by subsection
 26  2 10, paragraphs "a" through "n", the court shall do all of the
 26  3 following:
 26  4    a.  Shall not give any deference to the view of the agency
 26  5 with respect to whether particular matters have been vested by
 26  6 a provision of law in the discretion of the agency.
 26  7    b.  Should not give any deference to the view of the agency
 26  8 with respect to particular matters that have not been vested
 26  9 by a provision of law in the discretion of the agency.
 26 10    c.  Shall give appropriate deference to the view of the
 26 11 agency with respect to particular matters that have been
 26 12 vested by a provision of law in the discretion of the agency.
 26 13    12.  A defendant in a suit for civil enforcement of agency
 26 14 action may defend on any of the grounds specified in
 26 15 subsection 10, paragraphs "a" through "n", if that defendant,
 26 16 at the time the enforcement suit was filed, would have been
 26 17 entitled to rely upon any of those grounds as a basis for
 26 18 invalidating the agency action in a suit for judicial review
 26 19 of that action brought at the time the enforcement suit was
 26 20 filed.  If a suit for civil enforcement of agency action in a
 26 21 contested case is filed within the time period in which the
 26 22 defendant could have filed a petition for judicial review of
 26 23 that agency action, and the agency subsequently dismisses its
 26 24 suit for civil enforcement of that agency action against the
 26 25 defendant, the defendant may, within thirty days of that
 26 26 dismissal, file a petition for judicial review of the original
 26 27 agency action at issue if the defendant relied upon any of the
 26 28 grounds for judicial review in subsection 10, paragraphs "a"
 26 29 through "n", in a responsive pleading to the enforcement
 26 30 action, or if the time to file a responsive pleading had not
 26 31 yet expired at the time the enforcement action was dismissed.
 26 32    Sec. 25.  Section 17A.33, Code 1997, is amended to read as
 26 33 follows:
 26 34    17A.33  REVIEW BY ADMINISTRATIVE RULES REVIEW COMMITTEE.
 26 35    The administrative rules review committee shall review
 27  1 existing rules, as time permits, to determine if there are
 27  2 adverse or beneficial effects from these rules.  The committee
 27  3 shall give a high priority to rules that are referred to it by
 27  4 small business as defined in section 17A.31 17A.4A.  The
 27  5 review of these rules shall be forwarded to the appropriate
 27  6 standing committees of the house and senate.
 27  7    Sec. 26.  Section 19A.1A, Code 1997, is amended by adding
 27  8 the following new subsection:
 27  9    NEW SUBSECTION.  4.  Reduction in force appeals shall be
 27 10 subject to review by the director.
 27 11    Sec. 27.  Section 20.6, subsection 4, Code 1997, is amended
 27 12 to read as follows:
 27 13    4.  Hold hearings and administer oaths, examine witnesses
 27 14 and documents, take testimony and receive evidence, issue
 27 15 subpoenas to compel the attendance of witnesses and the
 27 16 production of records, and delegate such power to a member of
 27 17 the board, or persons appointed or employed by the board,
 27 18 including or administrative law judges appointed according to
 27 19 the requirements of section 17A.11, subsection 1, for the
 27 20 performance of its functions.  The board may petition the
 27 21 district court at the seat of government or of the county
 27 22 where a hearing is held to enforce a board order compelling
 27 23 the attendance of witnesses and production of records.
 27 24    Sec. 28.  Section 86.17, subsection 1, Code 1997, is
 27 25 amended to read as follows:
 27 26    1.  A Notwithstanding the provisions of section 17A.11, the
 27 27 industrial commissioner or a deputy industrial commissioner
 27 28 may shall preside over any contested case proceeding brought
 27 29 under this chapter, chapter 85, or 85A, or 85B in the manner
 27 30 provided by chapter 17A. The deputy commissioner or the
 27 31 commissioner may make such inquiries and investigation in
 27 32 contested case proceedings as shall be deemed necessary,
 27 33 consistent with so long as such inquiries do not violate any
 27 34 of the provisions of section 17A.17.
 27 35    Sec. 29.  Section 137E.12, Code 1997, is amended to read as
 28  1 follows:
 28  2    137E.12  REVOCATION OR ORDER FOR DISCONTINUANCE.
 28  3    A license issued under this chapter may be revoked by the
 28  4 regulatory authority for violation by the licensee of a
 28  5 provision of this chapter or an applicable rule of the
 28  6 department.  In lieu of license revocation, the regulatory
 28  7 authority may require the immediate discontinuance of
 28  8 operation of a vending machine or commissary if it finds
 28  9 unsanitary conditions or other conditions which constitute a
 28 10 substantial hazard to the public health.  The order shall
 28 11 apply only to the vending machines, commissary, or product
 28 12 involved.  A person whose license is revoked, or who is
 28 13 ordered to discontinue the operation of a vending machine or
 28 14 commissary, may appeal that decision to the director.  The
 28 15 director or the chief an administrative law judge of the
 28 16 department appointed according to the requirements of section
 28 17 17A.11, subsection 1, shall schedule and hold a hearing upon
 28 18 the appeal not later than thirty days from the time of
 28 19 revocation or the order of discontinuance.  The director or
 28 20 the chief administrative law judge shall issue a decision
 28 21 immediately following the hearing.  Judicial review may be
 28 22 sought in accordance with the Iowa administrative procedure
 28 23 Act chapter 17A.
 28 24    Sec. 30.  Section 148.7, subsection 3, Code 1997, is
 28 25 amended to read as follows:
 28 26    3.  The hearing shall be before a member or members
 28 27 designated by the board or before an administrative law judge
 28 28 appointed by the board according to the requirements of
 28 29 section 17A.11, subsection 1.  The presiding board member or
 28 30 administrative law judge may issue subpoenas, administer
 28 31 oaths, and take or cause depositions to be taken in connection
 28 32 with the hearing.  The presiding board member or
 28 33 administrative law judge shall issue subpoenas at the request
 28 34 and on behalf of the licensee.  The hearing shall be open to
 28 35 the public.
 29  1    The compensation of the administrative law judge shall be
 29  2 fixed by the medical examiners.  The administrative law judge
 29  3 shall be an attorney vested with full authority of the board
 29  4 to schedule and conduct hearings.  The administrative law
 29  5 judge shall prepare and file with the medical examiners the
 29  6 administrative law judge's findings of fact and conclusions of
 29  7 law, together with a complete written transcript of all
 29  8 testimony and evidence introduced at the hearing and all
 29  9 exhibits, pleas, motions, objections, and rulings of the
 29 10 administrative law judge.
 29 11    Sec. 31.  Section 169.5, subsection 9, paragraph e, Code
 29 12 1997, is amended to read as follows:
 29 13    e.  Hold hearings on all matters properly brought before
 29 14 the board and administer oaths, receive evidence, make the
 29 15 necessary determinations, and enter orders consistent with the
 29 16 findings.  The board may require by subpoena the attendance
 29 17 and testimony of witnesses and the production of papers,
 29 18 records, or other documentary evidence and commission
 29 19 depositions.  An administrative law judge may be appointed
 29 20 pursuant to section 17A.11, subsection 3 to perform those
 29 21 functions which properly repose in an administrative law
 29 22 judge.
 29 23    Sec. 32.  Section 169.14, subsection 3, Code 1997, is
 29 24 amended to read as follows:
 29 25    3.  The hearing shall be before a member or members
 29 26 designated by the board or before an administrative law judge
 29 27 appointed by the board according to the requirements of
 29 28 section 17A.11, subsection 1.  The presiding board member or
 29 29 administrative law judge may issue subpoenas, administer
 29 30 oaths, and take or cause depositions to be taken in connection
 29 31 with the hearing.  The member or officer shall issue subpoenas
 29 32 at the request and on behalf of the licensee.
 29 33    Sec. 33.  Section 203C.10, unnumbered paragraph 2, Code
 29 34 1997, is amended to read as follows:
 29 35    If upon the filing of the information or complaint the
 30  1 department finds that the licensee has failed to meet the
 30  2 warehouse operator's obligation or otherwise has violated or
 30  3 failed to comply with the provisions of this chapter or any
 30  4 rule promulgated under this chapter, and if the department
 30  5 finds that the public health, safety or welfare imperatively
 30  6 requires emergency action, then the department without hearing
 30  7 may order a summary suspension of the license in the manner
 30  8 provided in section 17A.18 17A.18A.  When so ordered, a copy
 30  9 of the order of suspension shall be served upon the licensee
 30 10 at the time the information or complaint is served as provided
 30 11 in this section.
 30 12    Sec. 34.  Section 207.14, subsection 2, unnumbered
 30 13 paragraph 2, Code 1997, is amended to read as follows:
 30 14    If upon expiration of the time as fixed the administrator
 30 15 finds in writing that the violation has not been abated, the
 30 16 administrator, notwithstanding section sections 17A.18 and
 30 17 17A.18A, shall immediately order a cessation of coal mining
 30 18 and reclamation operations relating to the violation until the
 30 19 order is modified, vacated, or terminated by the administrator
 30 20 pursuant to procedures outlined in this section.  In the order
 30 21 of cessation issued by the administrator under this
 30 22 subsection, the administrator shall include the steps
 30 23 necessary to abate the violation in the most expeditious
 30 24 manner possible.
 30 25    Sec. 35.  Section 216.15, subsection 3, paragraph a, Code
 30 26 1997, is amended to read as follows:
 30 27    a.  After the filing of a verified complaint, a true copy
 30 28 shall be served within twenty days by certified mail on the
 30 29 person against whom the complaint is filed.  An authorized
 30 30 member of the commission staff shall make a prompt
 30 31 investigation and shall issue a recommendation to an
 30 32 administrative law judge under the jurisdiction of employed
 30 33 either by the commission or by the office of administrative
 30 34 hearings created by section 10A.801, who shall then issue a
 30 35 determination of probable cause or no probable cause.
 31  1    Sec. 36.  Section 216.17, subsection 6, Code 1997, is
 31  2 amended to read as follows:
 31  3    6.  In the enforcement proceeding the court shall determine
 31  4 its order on the same basis as it would in a proceeding
 31  5 reviewing commission action under section 17A.19, subsection
 31  6 8.
 31  7    Sec. 37.  Section 252.27, unnumbered paragraph 2, Code
 31  8 1997, is amended to read as follows:
 31  9    The board shall record its proceedings relating to the
 31 10 provision of assistance to specific persons under this
 31 11 chapter.  A person who is aggrieved by a decision of the board
 31 12 may appeal the decision as if it were a contested case before
 31 13 an agency and as if the person had exhausted administrative
 31 14 remedies in accordance with the procedures and standards in
 31 15 section 17A.19, subsections 2 to 8 12 except subsection 10,
 31 16 paragraphs "b" and "c" of subsection 8 "g", and section
 31 17 17A.20.
 31 18    Sec. 38.  Section 256.7, subsection 6, Code 1997, is
 31 19 amended to read as follows:
 31 20    6.  Hear appeals of persons aggrieved by decisions of
 31 21 boards of directors of school corporations under chapter 290
 31 22 and other appeals prescribed by law.  The state board may
 31 23 review the record and shall review the decision of the
 31 24 director of the department of education or the administrative
 31 25 law judge designated by the director in for any appeals heard
 31 26 and decided by the director under chapter 290, and may affirm,
 31 27 modify, or vacate the decision, or may direct a rehearing
 31 28 before the director.
 31 29    Sec. 39.  Section 368.22, Code 1997, is amended by adding
 31 30 the following new subsections:
 31 31    NEW SUBSECTION.  4.  Subsection 9.
 31 32    NEW SUBSECTION.  5.  Subsection 10.
 31 33    NEW SUBSECTION.  6.  Subsection 11.
 31 34    Sec. 40.  Section 421.17, subsection 20, unnumbered
 31 35 paragraph 2, Code 1997, is amended to read as follows:
 32  1    The provisions of sections 17A.10 to 17A.18 17A.18A
 32  2 relating to contested cases shall not apply to any matters
 32  3 involving the equalization of valuations of classes of
 32  4 property as authorized by this chapter and chapter 441. This
 32  5 exemption shall not apply to a hearing before the state board
 32  6 of tax review.
 32  7    Sec. 41.  Section 535B.7, subsection 2, unnumbered
 32  8 paragraph 1, Code 1997, is amended to read as follows:
 32  9    The administrator may order an emergency suspension of a
 32 10 licensee's license pursuant to section 17A.18, subsection 3
 32 11 17A.18A.  A written order containing the facts or conduct
 32 12 which warrants the emergency action shall be timely sent to
 32 13 the licensee by restricted certified mail.  Upon issuance of
 32 14 the suspension order, the licensee must also be notified of
 32 15 the right to an evidentiary hearing.  A suspension proceeding
 32 16 shall be promptly instituted and determined.
 32 17    Sec. 42.  Section 602.9206, unnumbered paragraph 2, Code
 32 18 1997, is amended to read as follows:
 32 19    A senior judge also shall be available to serve in the
 32 20 capacity of administrative law judge under chapter 17A upon
 32 21 the request of an agency, and the supreme court may assign a
 32 22 senior judge for temporary duties as an administrative law
 32 23 judge.  A senior judge shall not be required to serve a period
 32 24 of time as an administrative law judge which, when added to
 32 25 the period of time being served by the person as a judge, if
 32 26 any, would exceed the maximum period of time the person agreed
 32 27 to serve pursuant to section 602.9203, subsection 2.
 32 28    Sec. 43.  Section 903A.1, Code 1997, is amended to read as
 32 29 follows:
 32 30    903A.1  CONDUCT REVIEW.
 32 31    The director of the Iowa department of corrections shall
 32 32 appoint independent administrative law judges whose duties
 32 33 shall include but are not limited to review, as provided in
 32 34 section 903A.3, of the conduct of inmates in institutions
 32 35 under the department.  Sections 10A.801 and 17A.11 do not
 33  1 apply to administrative law judges appointed pursuant to this
 33  2 section.
 33  3    Sec. 44.  Sections 10A.201, 10A.202, 17A.31, and 17A.32,
 33  4 Code 1997, are repealed.
 33  5    Sec. 45.  EFFECTIVE DATE.  This Act takes effect July 1,
 33  6 1998, and applies to agency proceedings commenced on or after
 33  7 that date, except that this Act shall apply to any agency
 33  8 proceedings conducted on a remand from a court or another
 33  9 agency on or after that date.  
 33 10                           EXPLANATION
 33 11    This bill makes changes to the Iowa administrative
 33 12 procedures Act and establishes an independent office of
 33 13 administrative hearings within the department of inspections
 33 14 and appeals to provide administrative law judges for the
 33 15 conduct of administrative hearings.  The bill takes effect
 33 16 July 1, 1998, and applies to initial or remanded proceedings
 33 17 commenced on or after that date.
 33 18    The bill establishes an independent office of
 33 19 administrative hearings within the department of inspections
 33 20 and appeals headed by a chief administrative law judge subject
 33 21 to appointment by the governor and confirmation by the senate.
 33 22 The new office, through the chief administrative law judge,
 33 23 would have the authority to employ and assign most
 33 24 administrative law judges (ALJs) that would preside over
 33 25 hearings held by state agencies in which the agency head did
 33 26 not preside.  New Code section 10A.801 requires the office to
 33 27 establish rules governing ALJs, including rules imposing on
 33 28 all persons who act as presiding officers a code of
 33 29 administrative judicial conduct that is similar to the Iowa
 33 30 code of judicial conduct.  The new section also makes
 33 31 provisions for the specialization of ALJs and the ability of
 33 32 agencies to require a certain level of expertness in ALJs used
 33 33 by that agency.  The new section also requires all newly hired
 33 34 ALJs to be admitted to the bar of this state.
 33 35    Code section 17A.3 is amended to provide that agencies
 34  1 shall, to the extent practicable, adopt rules that embody the
 34  2 standards, principles, and procedural safeguards that the
 34  3 agency will apply to the law it administers.
 34  4    Code section 17A.4 is amended to provide that when agencies
 34  5 adopt most rules, the agency shall include in a preamble to
 34  6 the rule a brief explanation of the principal reasons for its
 34  7 adoption, and, if applicable, any reasons for not including a
 34  8 provision providing for the waiver of that rule.
 34  9    The bill creates new Code section 17A.4A requiring agencies
 34 10 to issue a regulatory analysis of proposed rules under certain
 34 11 circumstances.  The new Code section replaces current law
 34 12 which provides for requests for an economic impact of a rule
 34 13 (Code section 17A.4(1)(c)) and for a small business regulatory
 34 14 analysis (Code section 17A.31) which are stricken.
 34 15    Code section 17A.7 is amended to provide a mechanism for
 34 16 requiring an agency to conduct a formal review of an adopted
 34 17 rule of the agency.  The amendment provides that the
 34 18 administrative rules review committee, the administrative
 34 19 rules coordinator, a political subdivision, an agency, or a
 34 20 petition of 25 people or of an association with at least 25
 34 21 members may request a review of a specified rule.  The
 34 22 amendment provides that the agency need only review a
 34 23 particular rule once every 5 years.
 34 24    Code section 17A.9 is rewritten by this bill.  Current law
 34 25 makes provision for agencies to establish rules governing the
 34 26 disposition of requests for declaratory rulings as to the
 34 27 applicability of any law of the agency.  The new Code section
 34 28 provides specific guidelines, including specific time
 34 29 standards, concerning the disposition of a petition requesting
 34 30 a declaratory order by an agency.  A declaratory order is
 34 31 defined similarly to the current declaratory ruling.
 34 32    New Code section 17A.10A is created to provide that a party
 34 33 can request a contested case proceeding even if the facts of
 34 34 the particular case are not in dispute.
 34 35    Code section 17A.11 governing presiding officers and
 35  1 administrative law judges is rewritten.  The new Code section
 35  2 provides that if an ALJ is used, the ALJ must be from the
 35  3 office of administrative hearings unless the agency or an
 35  4 agency officer is not a party or the real party in interest in
 35  5 the hearing.  The new Code section also provides for the
 35  6 disqualification and substitution of presiding officers.
 35  7    Code section 17A.12, subsection 3, governing defaults in
 35  8 contested case proceedings is rewritten, providing the
 35  9 mechanism, including applicable time standards, governing the
 35 10 imposition of a default order.
 35 11    Code section 17A.16 is amended to require that a proposed
 35 12 or final agency decision include reasons why evidence contrary
 35 13 to the finding does not preclude that finding.
 35 14    Code section 17A.17 governing ex parte communications and
 35 15 separation of functions is amended by the bill.  The bill bars
 35 16 a person from both personally investigating a matter and then
 35 17 serving as a presiding officer or assisting the presiding
 35 18 officer when the matter is considered.  The bill also provides
 35 19 that if a presiding officer has received an ex parte
 35 20 communication prior to the commencement of a contested case,
 35 21 the officer must disclose any material factual information
 35 22 received that has not already been provided through discovery.
 35 23    New Code section 17A.18A governing emergency adjudicative
 35 24 proceeding is created by the bill.  Current law, reflected in
 35 25 Code section 17A.18, subsection 3 and replaced by this new
 35 26 Code section, makes provision only for emergency proceedings
 35 27 concerning licenses.
 35 28    Code section 17A.19 governing judicial review is amended to
 35 29 provide specific guidelines concerning the granting of stays
 35 30 and for the review of a grant or denial of a stay.  The bill
 35 31 also specifies, in greater detail than the current Code, the
 35 32 standards to be applied by a court when it reviews agency
 35 33 action.  The bill requires a court reviewing a finding of fact
 35 34 in a contested case under the substantial evidence test to
 35 35 consider both the evidence that supports and the evidence that
 36  1 detracts from the finding.
 36  2    Code section 17A.19 is also amended to provide that a
 36  3 defendant in a suit for civil enforcement of agency action may
 36  4 defend on any of the grounds specified for judicial review of
 36  5 agency action if that defendant could have relied on any of
 36  6 those grounds in a suit for judicial review of that action
 36  7 brought at the time the enforcement suit was filed.  
 36  8 LSB 1598IC 77
 36  9 ec/jj/8
     

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