House File 2426 - Introduced HOUSE FILE 2426 BY PETTENGILL A BILL FOR An Act relating to regulation and supervision of executive 1 branch administrative units that regulate a profession. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 5352YH (4) 86 tr/nh

H.F. 2426 Section 1. Section 2A.4, Code 2016, is amended by adding the 1 following new subsection: 2 NEW SUBSECTION . 13. a. Reviewing of legislation creating 3 or modifying an executive branch administrative unit that 4 regulates a profession to evaluate all of the following: 5 (1) Whether the legislation enacts a least restrictive 6 regulatory approach necessary to protect consumers. 7 (2) Whether the legislation impacts opportunities for 8 workers, consumer costs or choices, market competition, costs 9 to the state, or unemployment. 10 (3) How the legislation compares to similar legislation in 11 other states. 12 b. The legislative services agency shall submit an 13 annual report by January 1 to the general assembly regarding 14 legislation enacted during the preceding legislative session 15 that created or modified an executive branch administrative 16 unit that regulates a profession. In accordance with 17 subsection 1, the report submitted shall not contain any public 18 policy recommendations. 19 c. Beginning January 1, 2018, the legislative services 20 agency shall review the administrative rules of each executive 21 branch administrative unit that regulates a profession on a 22 five-year rotation schedule to evaluate compliance by those 23 administrative units with the goals set forth in section 7E.1, 24 subsection 4. Beginning January 1, 2019, the legislative 25 services agency shall submit an annual report to the general 26 assembly regarding its evaluation. In accordance with 27 subsection 1, the report submitted shall not contain any public 28 policy recommendations. 29 Sec. 2. Section 7E.1, Code 2016, is amended by adding the 30 following new subsection: 31 NEW SUBSECTION . 4. Policy of state regarding regulation 32 of professions. In maintaining its responsibility for 33 regulating executive branch administrative units that regulate 34 a profession, the state shall: 35 -1- LSB 5352YH (4) 86 tr/nh 1/ 4

H.F. 2426 a. Pursue policies that increase opportunities, promote 1 competition, and encourage innovation. 2 b. Adopt the least restrictive regulations necessary to 3 protect consumers. 4 c. Enforce laws or rules relating to the regulation of 5 professions against a person only to the extent the person is 6 engaged in the practice explicitly regulated by the laws or 7 rules governing a particular administrative unit. 8 d. Provide active supervision of executive branch 9 administrative units that regulate a profession to ensure that 10 those administrative units and their employees avoid liability 11 under federal antitrust laws. 12 Sec. 3. Section 13.2, subsection 1, Code 2016, is amended by 13 adding the following new paragraph: 14 NEW PARAGRAPH . q. (1) Engage in active supervision of 15 all executive branch administrative units that regulate a 16 profession. The attorney general shall ensure through active 17 supervision that all executive branch administrative units that 18 regulate a profession pursue a least restrictive regulatory 19 approach. 20 (2) The regulatory approach used by an executive branch 21 administrative unit shall be evaluated based on the following 22 list of regulatory activities ranked from least to most 23 restrictive: 24 (a) Market competition regulations. 25 (b) Private certification requirements. 26 (c) A special private civil cause of action to remedy 27 consumer harm. 28 (d) Deceptive trade practices regulations. 29 (e) Regulation of the process of providing the specific 30 goods or services to consumers. 31 (f) Inspection requirements. 32 (g) Bonding or insurance requirements. 33 (h) Registration requirements. 34 (i) Government certification requirements. 35 -2- LSB 5352YH (4) 86 tr/nh 2/ 4

H.F. 2426 (j) Professional licensure requirements. 1 (3) (a) For purposes of this paragraph “q” , “active 2 supervision” means approval, modification, or rejection of any 3 of the following actions proposed to be taken by an executive 4 branch administrative unit that regulates a profession: 5 (i) Any disciplinary action against a person authorized to 6 practice the profession by the administrative unit. 7 (ii) Adoption of a new, or an amendment to an existing, rule 8 or policy. 9 (b) “Active supervision” includes conducting investigations 10 and cooperating with the legislative services agency to perform 11 the duties described in section 2A.4, subsection 13, paragraph 12 “c” , to determine the least restrictive regulatory approaches 13 for each executive branch administrative unit that regulates 14 a profession and ways to minimize exposure to antitrust 15 challenges. “Active supervision” does not include provision of 16 general counsel or representation in a court, hearing, or other 17 tribunal action involving the state, any subdivision of the 18 state, or any state officer in the officer’s official capacity. 19 EXPLANATION 20 The inclusion of this explanation does not constitute agreement with 21 the explanation’s substance by the members of the general assembly. 22 This bill establishes a state policy for the regulation 23 of executive branch administrative units that regulate a 24 profession. The bill requires the legislative services agency 25 to review all legislation that creates or modifies executive 26 branch administrative units that regulate a profession and 27 instructs the agency to conduct a review of the administrative 28 rules of such administrative units and submit an annual 29 report to the general assembly. The bill requires the 30 attorney general to actively supervise all executive branch 31 administrative units that regulate a profession. The bill 32 provides guidance to the attorney general in how to provide 33 “active supervision” and establishes a hierarchy of regulatory 34 activities to determine a “least restrictive regulatory 35 -3- LSB 5352YH (4) 86 tr/nh 3/ 4

H.F. 2426 approach”. 1 -4- LSB 5352YH (4) 86 tr/nh 4/ 4