BILL ANALYSIS Ó ACA 1 Page 1 Date of Hearing: May 1, 2013 ASSEMBLY COMMITTEE ON ACCOUNTABILITY AND ADMINISTRATIVE REVIEW Jim Frazier, Chair ACA 1 (Donnelly) - As Introduced: December 3, 2012 SUBJECT : Administrative regulations: legislative approval. SUMMARY : Amends the California Constitution to require state agencies to submit all regulations that have been approved by the Office of Administrative Law (OAL) to the Legislature for final approval. Specifically, this measure : 1)Prohibits a state agency from issuing, utilizing, enforcing, or attempting to enforce any regulation unless the state agency complies with requirements in the Administrative Procedure Act (APA) and, after the regulation is approved by OAL, submits the regulation to the Legislature for its approval. 2)Exempts from the requirements of this measure emergency regulations that are not effective for more than 180 days and any regulation proposed prior to the effective date of this measure. 3)Authorizes the Legislature to approve any regulation submitted to it by means of a concurrent resolution. 4)Deems a regulation disapproved if a concurrent resolution to approve it fails to obtain a majority vote in either house, or it is not approved by the Legislature within 60 calendar days after it was submitted. 5)Clarifies that this measure does not restrict the Legislature's authority to enact a statute that has the effect of nullifying a regulation; establish statutory procedures and requirements for the approval and adoption of regulations; and, delegate to a state agency the authority to propose regulations. EXISTING LAW : Establishes the OAL to administer the Administrative Procedure Act (APA) and ensure that state agency regulations are clear, necessary, legally valid, and available to the public. The APA establishes a specific process for state agencies to follow that includes assessing the cost of ACA 1 Page 2 regulations, providing public notice of proposed regulations and opportunity for interested parties to comment, and review by the OAL. FISCAL EFFECT : Unknown COMMENTS : According to the author, state agencies exert, to some degree, all three powers of the individual branches of state government. The author contends that "agencies exercise executive power when they enforce state statutes; exercise judicial power when they conduct administrative hearings; and, exercise legislative power when they adopt rules and regulations." The author asserts that this measure would solve part of what the author calls this crisis in governance by reclaiming the Legislature's ability to write the laws. The author argues that "many regulations enacted by state agencies take the place of laws, and if they are to be forced on the general public, then the elected representatives should be forced to take a public stance on them. Unelected, unaccountable bureaucrats have no business writing laws." OAL is the oversight agency established by statute in 1979 to provide for the orderly review of regulations. In creating the OAL, the Legislature expressed intent that it was designed to reduce the number of administrative regulations and improve the quality of those regulations that were adopted. In 1983, the Legislature further expressed its intent that state agencies should actively seek to reduce the unnecessary regulatory burden on individuals and businesses by substituting performance standards for prescriptive standards as long as both were equally effective. The six main legal standards OAL applies when reviewing proposed regulations are as follows: 1)Authority - the underlying law that permits or obligates an agency to engage in a regulatory activity; 2)Reference - the statute or court decision the regulation implements; 3)Consistency - the regulation does not conflict with existing law; 4)Clarity - the regulation is written in easily understood language; 5)Non-duplication - the regulation does not overlap with other regulations; and, ACA 1 Page 3 6)Necessity - the regulation is needed to carry out the law. According to the OAL, it has 30 working days to approve a regulation and 10 working days to act on an emergency regulation. The OAL reports that it usually takes roughly six weeks to approve regulations and, of the 578 that were submitted from over 200 agencies in 2012, 87% were approved and 13% were disapproved or withdrawn. Regulations are designed to implement state requirements established in statute by the Legislature and Governor to benefit Californians. A primary purpose of the APA is to provide a public process by which persons or entities affected by a regulation have a voice in its creation as well as notice of the law's new requirements. The requirement in this measure for all regulations to receive final approval from the Legislature could create a significant workload bottleneck that impedes the legislative process and potentially subvert the APA and the OAL rulemaking process. As a constitutional amendment, this measure requires the approval of the voters to take effect. PRIOR LEGISLATION : 1)AB 1504 (Morrell) of 2012 would have, among other things, revised various provisions of the APA related to public participation by requiring agencies to notify the public of the public comment period for an economic assessment 90 days prior to submitting a notice of proposed action to OAL; list the parties that the agency identifies as being affected by the proposed regulation on its Internet Web site; and, make public all comments received. This measure failed passage in the Assembly Business, Professions, and Consumer Protection Committee. 2)AB 1982 (Gorrell) of 2012 would have increased the effective date for a regulation or an order of repeal of a regulation from 30 to 90 days and would have required OAL to forward a copy of each major regulation to the Legislature for review. This bill died on the Assembly Appropriations Committee Suspense File. REGISTERED SUPPORT / OPPOSITION : ACA 1 Page 4 Support None on file. Opposition None on file. Analysis Prepared by : Cassie Royce / A. & A.R. / (916) 319-3600