HF 718 (LSB 2672YH (3) 91)

HOUSE FILE 718

BY  WILLS

A BILL FOR

An Act establishing processes for delay, rescission, and approval of certain administrative rules based on fiscal impact and including applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 17A.4, subsection 4, Code 2025, is amended to read as follows:
   4.  Any rule filed pursuant to this section or section 17A.5 that necessitates additional annual expenditures of at least one hundred thousand dollars or combined expenditures of at least five hundred thousand dollars within five years by all affected persons, including the agency itself, shall be accompanied by a fiscal impact statement outlining the expenditures. The agency shall promptly deliver a copy of file the statement to with the legislative services agency along with the rule filed with the administrative rules coordinator and the administrative code editor pursuant to this section or section 17A.5. To the extent feasible, the legislative services agency shall analyze the statement and provide a summary of that analysis to the administrative rules review committee. If the agency has made a good-faith effort to comply with the requirements of this subsection, the rule shall not be invalidated on the ground that the contents of the statement are insufficient or inaccurate.
    Sec. 2.  NEW SECTION.  17A.25  Delay, rescission, and approval of rules —— fiscal impact.
   1.  a.  If the fiscal impact statement prepared by an agency pursuant to section 17A.4, subsection 4, for a rule adopted pursuant to section 17A.5 indicates the rule will necessitate additional annual expenditures of at least one million dollars, or combined expenditures of at least five million dollars within five years, by all affected persons, including the agency itself, the effective date of the rule shall be delayed until the adjournment of the next regular session of the general assembly that convenes after the rule is published in the Iowa administrative bulletin. The agency shall note the delay in its filing submitted to the administrative rules coordinator and administrative code editor pursuant to section 17A.5, subsection 1. The administrative code editor shall publish notice of the delay in the Iowa administrative bulletin. The agency shall not adopt such a rule pursuant to section 17A.5, subsection 2, paragraph “b”, unless the rule was also adopted pursuant to section 17A.4, subsection 3.
   b.  Upon the adjournment of the regular session of the general assembly specified in paragraph “a”, a rule delayed pursuant to paragraph “a” is rescinded and shall not become effective. As soon as practicable after such rescission, the administrative code editor shall publish notice of the rescission in the Iowa administrative bulletin and, no sooner than two weeks after such publication, remove the rule from the Iowa administrative code.
   c.  During the period of a delay pursuant to paragraph “a”, the agency may do any of the following:
   (1)  Engage in further rulemaking that will amend or repeal a rule subject to the delay. However, any rule that amends or repeals a rule subject to a delay, and that will become effective during the delay, shall be subject to that delay as though it were included in the initially delayed rule.
   (2)  Submit a notice of rescission that rescinds the rule to the administrative rules coordinator and the administrative code editor for publication in the Iowa administrative bulletin. Upon publication of the notice of rescission, if the rule has not already become effective or been rescinded, the rule is rescinded and shall not become effective. As soon as practicable, but no sooner than two weeks after such publication, the administrative code editor shall remove the rule from the Iowa administrative code.
   d.  If the effective date of a rule adopted by an agency that would otherwise be subject to a delay pursuant to subsection 1 may occur after the adjournment of the regular session of the general assembly specified in paragraph “a”, such rule shall be deemed to be delayed pursuant to subsection 1 and subject to this section.
   e.  This section shall not apply to a rule adopted pursuant to section 17A.4, subsection 3.
   2.  The general assembly may, by a joint resolution approved by the governor, approve a rule delayed pursuant to subsection 1 prior to its rescission pursuant to subsection 1. Upon approval of the joint resolution by the governor, the rule shall not be rescinded and shall become effective upon the date of approval of the joint resolution by the governor, or another date specified in the joint resolution. This subsection shall not be construed to prohibit the general assembly from enacting other legislation relating to a rule delayed pursuant to subsection 1, including but not limited to a joint resolution to nullify the rule.
   3.  For purposes of this section, “additional annual expenditures” includes expenditures by political subdivisions or agencies, and entities which contract with political subdivisions, to provide services as described in section 25B.6, subsection 1. “Additional annual expenditures” does not include an expenditure of funds by the agency that adopted a rule if the funds were appropriated to the agency for the purpose of the agency program or other function implemented by the rule.
    Sec. 3.  APPLICABILITY.  This Act applies to rules adopted by agencies pursuant to section 17A.5 on or after July 1, 2026.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill establishes processes for delay, rescission, and approval of certain administrative rules (rules) based on fiscal impact statements prepared by agencies as required under Code section 17A.4, subsection 4.
   The bill provides that if the fiscal impact statement prepared by an agency for an adopted rule indicates the rule will necessitate additional annual expenditures of at least $1 million, or combined expenditures of at least $5 million within five years, by all affected persons, including the agency itself, the effective date of the rule shall be delayed until the adjournment of the next regular session of the general assembly that convenes after the rule is published in the Iowa administrative bulletin (bulletin).
   The bill provides that upon the adjournment of the specified regular session of the general assembly, a rule delayed in this manner is rescinded and shall not become effective.
   The bill authorizes an agency, during the period of a delay, to engage in further rulemaking that will amend or repeal a rule subject to the delay. However, any rule that amends or repeals a rule subject to a delay, and that will become effective during the delay, shall be subject to that delay as though it were included in the initially delayed rule.
   The bill authorizes an agency, during the period of a delay, to submit a notice of rescission for publication in the bulletin that rescinds the rule. Upon publication of the notice, if the rule has not already become effective or been rescinded, the rule is rescinded and shall not become effective.
   The bill provides that the general assembly may, by a joint resolution approved by the governor, approve a rule delayed in this manner prior to its rescission. Upon approval of the joint resolution by the governor, the rule shall not be rescinded and shall become effective upon the date of approval of the joint resolution by the governor, or another date specified in the resolution. The bill shall not be construed to prohibit the general assembly from enacting other legislation relating to a delayed rule, including but not limited to a joint resolution to nullify the rule.
   For purposes of the bill, “additional annual expenditures” includes expenditures by political subdivisions or agencies, and entities which contract with political subdivisions, to provide services as described under current law, but does not include an expenditure of funds by the agency that adopted a rule if the funds were appropriated to the agency for the purpose of the agency program or other function implemented by the rule.
   The bill addresses how the procedures provided in the bill apply to rules adopted pursuant to Code section 17A.4, subsection 3, and Code section 17A.5, subsection 2, paragraph “b” (emergency rules).
   Under current law, a fiscal impact statement that is required for a noticed or adopted rule must be promptly delivered to the legislative services agency. The bill provides that the statement must be included with a rule when it is filed.
   The bill applies to rules adopted by agencies on or after July 1, 2026.