BILL ANALYSIS                                                                                                                                                                                                    Ó






                                                       Bill No:  SB 
          401
          
                 SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
                       Senator Roderick D. Wright, Chair
                           2011-2012 Regular Session
                                 Bill Analysis
          

          SB 401  Author:  Fuller
          Introduced:  February 16, 2011
          Hearing Date:  April 12, 2011
          Consultant:  Paul Donahue


           SUBJECT  :  Regulations: Review Process

           SUMMARY  :   Specifies that every regulation proposed by a 
          state agency after January 1, 2012, shall include a 
          provision repealing the regulation in 5 years.
          
           Existing law  :  The Administrative Procedure Act governs the 
          procedure for the adoption, amendment, or repeal of 
          regulations by state agencies and for the review of those 
          regulatory actions by the Office of Administrative Law. 
          (Govt. Code § 11340 et seq.)

           This bill  :

          1) Requires that every regulation proposed by an agency 
          after January 1, 2012, include a provision repealing the 
          regulation in 5 years.

          2) Prohibits OAL from approving a proposed regulation 
          unless it contains repeal provisions.

          3) Authorizes an agency, in the year prior to a 
          regulation's scheduled repeal, to amend the regulation to 
          extend the repeal date after complying with certain public 
          hearing requirements.

           COMMENTS  :
          
          1)  Purpose and intent  :  The author notes that businesses 
          have left California, contemplated leaving the state, or 
          dismissed ever relocating to California often cite the 




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          state's regulatory climate as the primary reason for their 
          decision.  Job gains in Texas and Arizona far outpace those 
          of California. The author states that, for years, 
          regulations have been adopted by state agencies with no 
          follow-up review of the new rules to find out whether a 
          rule is achieving its original stated objective and not 
          causing economic harm.

          The author believes that the built-in review process would 
          allow a determination as to whether a new rule is necessary 
          and would allow accumulation of at least 4 years' worth of 
          data to develop a thorough cost-benefit analysis of the new 
          regulation.  

          2)  Support  :  The supporters note that smart regulations are 
          necessary, cost effective, fairly enforced and regularly 
          updated to reflect changing conditions and needs. Currently 
          California regulations are adopted, reviewed, and approved 
          under a system established in 1979 and only modestly 
          changed thereafter.  Since that time the Legislature has 
          granted massive new powers to government agencies and there 
          has been exponential growth in regulations concerning every 
          aspect of the economy, mostly outside the control or even 
          awareness of elected officials.

          Supporters believe it is reasonable to periodically examine 
          how a regulation has been implemented for the previous 5 
          years, to hear public comment and bring to light problems 
          that could be resolved by new regulations or legislation.

          3)  Opposition  :  Opponents state that nobody could argue 
          with the notion that updating and streamlining regulations 
          is sensible and serves taxpayers' interests.  However, an 
          automatic, across-the-board sunset mandate is totally 
          unnecessary because review of existing regulations can be 
          effectively addressed by agencies on a case-by-case basis, 
          and, moreover, existing law already provides for targeted 
          requests for review from the public and from the 
          Legislature.

          The opponents to the bill contend that this type of sunset 
          mandate is completely unrealistic given the enormous 
          resources it would entail. They believe it would 
          inordinately consumer limited government resources and 
          necessarily distract the government from critically 
          important tasks.




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          4)  Note  : This bill is double referred to Senate 
          Environmental Quality Committee.

          5)  Related legislation  :

           SB 366 (Calderon, 2011)  .  Requires each state agency to 
          identify any regulations that are duplicative, overlapping, 
          inconsistent, or out of date, and adopt, amend, or repeal 
          regulations to reconcile or eliminate any duplication, 
          overlap, inconsistency, or out-of-date provisions. (Pending 
          in this Committee)

           SB 396 (Huff, 2011)  .  Requires each state agency to review 
          each regulation adopted prior to January 1, 2011, and 
          report to the Legislature on the regulations.  Beginning in 
          2018, at least every 5 years afterwards, each agency is 
          directed to review its regulations that have been in effect 
          for at least 20 years and submit a report to the 
          Legislature on its findings associated with the review. (On 
          calendar today in this Committee)

           SUPPORT:   

          American Chemistry Council
          American Council of Engineering Companies of California
          Association of California Water Agencies
          California Association of Bed and Breakfast Inns
          California Building Industry Association
          California Business Properties Association
          California Chapter of the American Fence Association
          California Construction and Industrial Material Association
          California Fence Contractors' Association
          California Grocers Association
          California Hotel and Lodging Association
          California Manufacturers and Technology Association
          California Restaurant Association
          California Retailers Association
          Consumer Specialty Products Association
          Engineering and Utility Contractors Association
          Engineering Contractors' Association
          Flasher Barricade Association
          Golden State Builders Exchanges
          Marin Builders' Association

           OPPOSE:   




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          American Lung Association in California
          Breathe California
          CA Conference Board of the Amalgamated Transit Union
          CA Conference of Machinists
          California League of Conservation Voters
          CA Official Court Reporters Association
          California Teamsters Public Affairs Council
          Engineers and Scientists of California
          International Longshore and Warehouse Union
          Professional and Technical Engineers, Local 21
          Sierra Club California
          Transform
          UNITE HERE!
          United Food and Commercial Workers - Western States 
          Conference
          Utility Workers Union of America, Local 132

           FISCAL COMMITTEE:   Yes



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