BILL ANALYSIS �
Bill No: SB
396
SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
Senator Roderick D. Wright, Chair
2011-2012 Regular Session
Bill Analysis
SB 396 Author: Huff
Amended: April 7, 2011
Hearing Date: April 12, 2011
Consultant: Paul Donahue
SUBJECT : Regulations: Review process
SUMMARY : Requires state agencies to review each regulation
adopted prior to 2011 and report to the Legislature on
their findings, and to review regulations every 5 years
thereafter.
Existing law : The Administrative Procedure Act (APA)
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 (OAL). (Govt. Code � 11340 et seq.)
This bill :
1) Requires each state agency to review each regulation
adopted prior to January 1, 2011, and develop a report that
includes at least the following information for each
regulation:
a) The date that the OAL approved the regulation.
b) The purpose.
c) The statutory authority.
d) The identification of impacted sectors.
e) The direct costs by sector.
f) Whether the regulation is duplicative of other
regulations.
g) Whether the regulation is still relevant.
h) Whether the regulation needs to be updated in order
to become more effective or less burdensome.
SB 396 (Huff)
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2) Requires an agency, in developing its report, to consult
with parties affected by the regulation.
3) Specifies that the agency must submit the report to the
Legislature on or before January 1, 2013.
4) States that, to the extent that an agency is a component
member of another agency, it shall submit a copy of its
report to the highest-ranking agency head prior to
submitting the report to the Legislature. The agency head
is directed to review the reports for each component agency
to identify duplicative or conflicting regulations between
departments.
5) Starting in 2018, and at least every 5 years thereafter,
directs each agency to review each regulation that is at
least 20 years old that hasn't been reviewed within the
last 10 years and report to the Legislature concerning the
review, including the following information:
a) The date that the OAL approved the regulation.
b) The purpose.
c) The statutory authority.
d) The identification of impacted sectors.
e) The direct costs by sector.
f) Whether the regulation is duplicative of other
regulations.
g) Whether the regulation is still relevant.
h) Whether the regulation needs to be updated in order
to become more effective or less burdensome.
6) Specifies that each agency shall submit an annual report
to the Legislature that identifies the regulations reviewed
during the previous year and the associated findings.
COMMENTS :
1) Purpose and intent : The author states that this bill
will reduce the state's regulatory burden on the private
sector and California's job market by ensuring that all
state agencies review state regulations in order to
identify those that are the most burdensome and obsolete.
It will also reduce the outdated or duplicative regulations
by requiring departments to review all regulations that are
at least 20 years old, every 5 years.
SB 396 (Huff)
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"According to the Gallup Job Creation Index, California had
the third worst job market in the nation in 2010, and today
California has the second highest unemployment rate. Much
of this is due to the impact of California's arduous and
vast regulatory laws on businesses.
"Despite the procedures set forth in the APA, our economy
is struggling due to onerous and duplicative regulations. A
Sacramento State University study found the total cost of
regulation is approximately $493 billion, or 3.8 million
lost jobs - a tenth of the state's population. Forbes
Magazine ranks California as the most costly state in which
to do business, while CEO Magazine finds California's
business climate as the worst in the nation for the 4th
year in a row.
"Today there are over 17,000 pages of regulations with
hundreds of new agency laws added each year by un-elected
bureaucrats. All of these carry the same force of law as
any legislation."
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 favor an ongoing process to review old
regulations and establish a process to keep regulations up
to date.
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.
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Opponents state further that this type of sunset mandate is
also completely unrealistic given the enormous resources it
would entail. Such a mandate would inordinately consume
limited government resources and necessarily distract the
government from critically important tasks.
4) Note: This bill is double referred to Senate Rules
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 401 (Fuller, 2011) . Specifies that every regulation
proposed by an agency after January 1, 2012, include a
provision repealing the regulation in 5 years. Prohibits
OAL from approving a proposed regulation unless it contains
repeal provisions. (On calendar today in this Committee)
SB 553 (Fuller) . Specifies that a regulation or an order of
repeal of a regulation shall become effective 180 days
after the date it is filed with the Secretary of State,
instead of 30 days, as provided in existing law. (On
calendar today in this Committee)
SUPPORT:
American Chemistry Council
American Council of Engineering Companies of California
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
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Engineering and Utility Contractors Association
Engineering Contractors' Association
Flasher Barricade Association
Golden State Builders Exchanges
Marin Builders' Association
San Gabriel Valley Legislative Coalition of Chambers
OPPOSE:
CA Conference Board of the Amalgamated Transit Union
CA Conference of Machinists
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
UNITE HERE!
United Food and Commercial Workers - Western States
Conference
Utility Workers Union of America, Local 132
FISCAL COMMITTEE: Yes
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