BILL ANALYSIS
AB 2299
Page 1
Date of Hearing: May 19, 2010
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 2299 (Blakeslee) - As Amended: April 26, 2010
Policy Committee: Natural
ResourcesVote:9-0
Urgency: No State Mandated Local Program:
No Reimbursable: No
SUMMARY
This bill requires the Air Resources Board (ARB) to submit an
impacts analysis for "major proposed regulation" to external
peer review. Specifically, this bill:
1)Defines a "major proposed regulation" as one that will have an
adverse economic impact on California business enterprises and
individuals in excess of $10 million, as estimated by ARB.
2)For each major proposed regulation, other than emergency
regulations, requires ARB to place into the rulemaking record
a related impacts analysis of the proposed regulation, at or
before the regulation is made available to the public.
3) Requires ARB to submit the impacts analysis for a major
proposed regulation to not more than one peer review if it
receives request for such review from a person within 15 days
of the proposed regulation being made public and provided the
person making the request agrees to pay for the peer review.
4)Requires ARB to enter into agreement with the National Bureau
of Economic Research, the University of California, the
California State University, or a group of economists of
comparable stature, who will complete the review within 90
days.
5)Prohibits ARB from taking action on a major proposed
regulation until the peer review is completed within the
90-day period and ARB accepts the findings of the review and
revises the proposed regulation, as necessary, or rejects the
findings and explains the basis for its rejection, in writing.
AB 2299
Page 2
6)Authorizes ARB to charge an application processing fee of up
to $500 to a person who requests peer review of a proposed
major regulation.
FISCAL EFFECT
1)Potential ongoing costs to ARB of an unknown amount, but
likely in the range of several hundred thousand dollars, for
ARB to contract with outside entities for peer review of
proposed major regulations. ARB's actual costs will depend
upon the number of peer reviews it must contract for and the
cost of each peer review. In any case, the bill provides that
ARB will be reimbursed for these costs by the person
requesting the peer review (APCF or other special fund,
reimbursed by private funds).
2)Potential ongoing costs to ARB to process applications for
peer review, fully covered by the processing fee authorized by
this bill.
3)Costs of an unknown but potentially significant amount to ARB
to the extent it must revise proposed major regulations based
on the findings peer reviews (APCF or other special fund).
COMMENTS
1)Rationale . The author contends that ARB's rulemaking process
lacks a mechanism to ensure the board has adequately
identified and considered nonscientific effects, such as the
effects on economic activity, of a proposed regulation or
rule. The author intends this bill to provide such a
mechanism without increasing costs to ARB.
2)Background . Existing law requires proposed regulations to
undergo a variety of reviews. For example, all state agencies
and departments are subject to the Administrative Procedures
Act, which is to ensure state agency regulations are clear,
necessary, legally valid, and available to the public. In
addition, the departments, boards, and offices of the
California Environmental Protection Agency are required to
evaluate equally effective but less costly alternatives to
proposed regulations.
As evidence of a perceived problem with ARB's consideration of
economic and other effects of its proposed rulemaking, the
AB 2299
Page 3
author cites a recent editorial in the Sacramento Bee. The
editorial discussed ARB's handling of its adopted and
soon-to-be-revised regulation on emissions from diesel
engines. The editorial closes by asserting that ARB's
reputation has been damaged, though "not irreparably," by its
handling of its diesel regulations.
3)Do We Trust ARB to Tell Us Which Regulations Will Have a Major
Economic Effect? The bill implies a lack of faith in ARB's
ability to accurately or comprehensively account for the
economic effects of proposed regulations; hence, the need for
external economic review. Given this doubt, it seems strange
that the bill tasks ARB with determining which of its proposed
regulations will have adverse economic effects in excess of
$10 million.
4)Regulatory Action Will Be Delayed . Most ARB regulations have
potential adverse economic effects in excess of $10 million.
It is reasonable to assume that individuals or groups will
seek peer review of ARB's analysis of many or most of these
regulations. One certain result will be delay of those
regulations, at least by 90 days, to accommodate the peer
reviews and ARB's responses to them. The peer review
provisions do not apply, however, to emergency regulations,
and the information gained by the peer review process may be
worth the time lost.
5)Support . The bill is supported by numerous organizations
representing entities frequently subject to ARB regulation.
6)There is no registered opposition to this bill.
Analysis Prepared by : Jay Dickenson / > / (916) 319-2081