BILL ANALYSIS
AB 2299
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Date of Hearing: April 19, 2010
ASSEMBLY COMMITTEE ON NATURAL RESOURCES
Wesley Chesbro, Chair
AB 2299 (Blakeslee) - As Amended: April 13, 2010
SUBJECT : State Air Resources Board (ARB): rules and
regulations: impact analysis
SUMMARY : Requires ARB to prepare an analysis of "related
impacts" for any rule proposed by the board. Authorizes any
person to request an external peer review of the ARB impacts
analysis for any rule ARB determines has an economic impact of
at least $10 million. Requires ARB to engage an external peer
review if the requestor agrees to reimburse ARB for all costs of
review. Prohibits ARB from adopting the rule until the review
is complete, unless the review is not provided to ARB within 90
days.
EXISTING LAW :
1)Establishes the Administrative Procedures Act (APA) governing
the adoption of regulations by state agencies for purposes of
ensuring that state agency regulations are clear, necessary,
legally valid, and available to the public.
2)Requires independent peer review of scientific issues related
to regulations proposed by departments, boards and offices of
the California Environmental Protection Agency (CalEPA),
including ARB.
3)Pursuant to the California Global Warming Solutions Act (AB
32), requires ARB to adopt a statewide GHG emissions limit
equivalent to 1990 levels by 2020 and to adopt rules and
regulations to achieve maximum technologically feasible and
cost-effective GHG emission reductions. AB 32 requires ARB to
evaluate the costs and benefits to California's economy,
environment, and public health, using the best available
economic models, emission estimation techniques, and other
scientific methods.
THIS BILL :
1)Defines "related impacts" to mean the reasonably identifiable
and significant impacts of a proposed rule, that are premised
AB 2299
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upon, or derived from, empirical data or other scientific or
economic findings, conclusions, or assumptions, including, but
not limited to, impacts to any of the following:
a) Other statutory and regulatory programs and standards,
under the jurisdiction of the Public Utilities Commission
(PUC) or any department within the California Environmental
Protection Agency (CalEPA) or the Natural Resources Agency
(NRA).
b) In-state jobs.
c) The General Fund and special funds due to changes in
economic activity.
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2)Defines "related impacts analysis" to mean an evaluation of
the secondary related impacts of a proposed rule quantified to
the extent feasible and appropriate and otherwise
qualitatively described.
3)Requires ARB to complete and place into the rulemaking record
for a proposed rule a related impacts analysis for the
proposed rule, at or before the time the proposed rule is made
available to the public, at a public workshop or for purposes
of public comment.
4)Authorizes any person, within 15 calendar days after a
proposed rule is made public to request ARB to submit the
related impacts analysis for external peer review for any
proposed rule determined by ARB to have a positive or negative
economic impact of at least ten million dollars. ARB is
authorized to charge a $500 fee.
5)Requires ARB to enter into an agreement with the National
Bureau of Economic Research, the University of California, the
California State University, or a group of specified
economists to conduct the external peer review of the related
impacts analysis of the rule proposed for adoption if, within
30 calendar days after making the request, the person
requesting the external peer review enters into an enforceable
agreement with ARB that requires that person to fully
reimburse ARB for all costs associated with conducting the
external peer review.
6)Specifies procedures and prohibitions on who may participate
on the peer review and communications with a peer reviewer.
7)If an external peer review is initiated, prohibits ARB from
adopting the final version of a rule unless all the following
conditions are met:
a) The external peer review entity prepares a written
report evaluating the related impacts analysis within 90
days. If the external peer review entity finds that ARB
has failed to demonstrate that the related impacts analysis
is based upon sound scientific or economic knowledge,
methods, or practices, the report shall state that finding
and the reasons explaining that finding.
b) ARB accepts the finding of the external peer review
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entity, in whole or in part, and revises the proposed rule
accordingly, or rejects the finding. If ARB disagrees with
any aspect of the findings, it must explain its reasons
thereof, including the scientific and economic basis.
c) ARB conducts a public hearing as specified.
FISCAL EFFECT : Unknown
COMMENTS :
1)Purpose of the bill. According to the author's office:
Current law recognizes the benefit of having a formalized
process for conducting an external peer review of the
"scientific portion" of environmental rules or regulations
proposed by CalEPA and its boards, departments and offices.
This process of evaluating scientific information
increases confidence in the assumptions guiding the
development of regulations. What is missing in the current
process is an equivalent consideration of the impacts, in
addition to impacts to public health and the environment,
of proposed rules. AB 2299 resolves this inequity to
ensure that ARB members move forward based on the most
unimpeachable information available.
2)Existing regulation review. Existing law provides for a
variety of regulatory review processes required to be
completed prior to the implementation of regulations. For
example, all state agencies and departments are subject to the
APA which governs the adoption of regulations for purposes of
ensuring that they are clear, necessary, legally valid, and
available to the public. In addition to due process
requirements, the APA requires state agencies to justify
proposed regulations by evaluating the technical and empirical
evidence that supports the proposed regulation in comparison
to reasonable alternatives, and specifically requires
evaluation and documentation supporting a proposed regulation
that requires the use of a specific technology or which could
have a negative impact on business. Further, CalEPA
departments, boards, and offices are required to evaluate
alternatives to proposed regulations and consider whether less
costly alternatives exist that would be equally effective in
achieving the environmental objective.
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3)What's a "related impact"? This bill defines related impact
(reasonably identifiable and significant impacts of a proposed
rule) but the definition itself begs for a definition. While
the type of impacts (e.g., economic, environmental, social)
are not specified, potential recipients of an impact are: the
PUC; any department within CalEPA and NRA; in-state jobs; and
the GF and special funds. To clarify and focus the scope of
analysis, the author and the committee may wish to consider
limiting the analysis to the three subjects specified in the
bill: related regulatory programs, in-state jobs, and state
fiscal impacts.
4)Benefits of expert review should be weighed against potential
for delay. The process described in this bill, if properly
applied, could improve the quality of ARB's regulatory process
and results. However, the process could also be used as a
tool to delay adoption of rules necessary to achieve clean air
and climate change goals. Of particular note is the prospect
that any person can unilaterally suspend adoption of a rule
for up to 90 days, so long as they agree to pay for a peer
review. In addition, this bill does not give ARB any
discretion to refuse to undertake a review and does not limit
the number of reviews that may be requested for any one rule,
so it's possible that multiple, consecutive reviews could be
conducted to stretch the 90-day timeline. The author and the
committee may wish to consider whether the number of reviews
that may be conducted for any rule should be limited to one
and whether ARB should have discretion to deny a review
request under specified circumstances.
REGISTERED SUPPORT / OPPOSITION :
Support
Automotive Aftermarket Industry Association
California Automotive Wholesalers Association
California Chamber of Commerce
California Chapter of the American Fence Association
California Construction and Industrial Association
California Dump Truck Owners Association
California Farm Bureau Federation
California Fence Contractors Association
California Forestry Association
California Independent Oil Marketers Association
California Manufacturers and Technology Association
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California Retailers Association
Engineering Contractors Association
Flasher/Barricade Association
Marin Builders Association
National Federation of Independent Business
Western Growers
Opposition
None on file
Analysis Prepared by : Lawrence Lingbloom / NAT. RES. / (916)
319-2092