03/13/2024 01:00 PM House JUDICIARY

            HB 278-ADMIN. REGULATION REVIEW DIVISION                                                                        
                                                                                                                                
2:29:14 PM                                                                                                                    
                                                                                                                                
CHAIR VANCE announced  that the final order of  business would be                                                               
HOUSE  BILL  NO. 278,  "An  Act  establishing the  administrative                                                               
regulation review division."                                                                                                    
                                                                                                                                
2:29:32 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  BEN  CARPENTER,   Alaska  State  Legislature,  on                                                               
behalf of the House Special  Committee on Ways and Means, sponsor                                                               
by  request, chaired  by Representative  Carpenter, presented  HB
.   He  paraphrased  the sponsor  statement  [included in  the                                                               
committee packet], which read as follows [original punctuation                                                                  
provided]:                                                                                                                      
                                                                                                                                
     According to the Bureau  of Economic Analysis, Alaska's                                                                    
     economic  growth is  the  worst in  the  nation. It  is                                                                    
     imperative that  we grow the  private economy.  One way                                                                    
     to do this is by  decreasing the high regulatory burden                                                                    
     Alaskan's have when doing business.                                                                                        
                                                                                                                                
     In  current law,  AS  44.62 (Administrative  Procedures                                                                    
     Act) allows  for the Governor or  Lieutenant Governor's                                                                    
     review of  regulations, requires the Department  of Law                                                                    
     to advise agencies on  regulations, and requires public                                                                    
     notice  and  public  comment.   There  is  no  specific                                                                    
     requirement   for   Legislative  review   of   proposed                                                                    
     regulations, nor  any action  that the  Legislature can                                                                    
     take on  them. Also  included in As.  44.62, government                                                                    
     corporations   are  exempt   from  the   Administrative                                                                    
     Procedures Act.                                                                                                            
                                                                                                                                
     HB  278 would  establish  an Administrative  Regulation                                                                    
     Review   Division,   a   vital  mechanism   to   ensure                                                                    
     transparency,  accountability,  and efficiency  in  the                                                                    
     regulatory process within the  State of Alaska. It also                                                                    
     Removes  the Government  corporations' exemptions  from                                                                    
     regulatory review from law.                                                                                                
                                                                                                                                
     The  Administrative  Regulation  Review  Division  will                                                                    
     serve as  a permanent staff agency  under the oversight                                                                    
     of  the Legislative  Budget  and  Audit Committee.  Its                                                                    
     primary function is  to facilitate thorough legislative                                                                    
     review  of  administrative  regulations  filed  by  the                                                                    
     Lieutenant  Governor.  This  will be  achieved  through                                                                    
     comprehensive   assessment  of   proposed  regulations,                                                                    
     ensuring alignment  with legislative  intent, statutory                                                                    
     authority, and consistency with applicable laws.                                                                           
                                                                                                                                
     The administrative  regulation review division  will be                                                                    
     tasked with several key responsibilities:                                                                                  
                                                                                                                                
     1. Reviewing  all administrative regulations  to ensure                                                                    
     they properly implement legislative intent.                                                                                
     2.  Providing  comments   and  recommendations  to  the                                                                    
     governor and state agencies on proposed regulations.                                                                       
     3.  Investigating  findings   transmitted  by  standing                                                                    
     committees  regarding   regulations  inconsistent  with                                                                    
     legislative intent.                                                                                                        
     4.   Promoting   needed   amendments  or   repeals   of                                                                    
     regulations deemed inappropriate or outdated.                                                                              
     5.   Recommending    legislative   action    to   annul                                                                    
     regulations found  to be inconsistent  with legislative                                                                    
     intent.                                                                                                                    
                                                                                                                                
     Furthermore, the  Division will  have the  authority to                                                                    
     examine   all  administrative   regulations,  including                                                                    
     proposed  adoptions, amendments,  or orders  of repeal.                                                                    
     It will  provide expert commentary  and recommendations                                                                    
     to   the  governor   and   state  agencies,   promoting                                                                    
     necessary  amendments   or  repeals   when  regulations                                                                    
     deviate  from  legislative  intent   or  fail  to  meet                                                                    
     statutory standards.                                                                                                       
                                                                                                                                
     HB 278 aims to  simplify regulatory compliance process,                                                                    
     ensure regulatory  compliance with  legislative intent,                                                                    
     and provide  a mechanism for continuous  improvement in                                                                    
     our regulatory  framework. This will  in turn  create a                                                                    
     better business environment for our State.                                                                                 
                                                                                                                                
2:35:30 PM                                                                                                                    
                                                                                                                                
KENDRA  BROUSSARD, Staff,  Representative  Ben Carpenter,  Alaska                                                               
state Legislature,  on behalf of  the House Special  Committee on                                                               
Ways  and Means,  sponsor by  request, chaired  by Representative                                                               
Carpenter,  presented the  sectional  analysis  [included in  the                                                               
committee packet],  which read  as follows  [original punctuation                                                               
provided]:                                                                                                                      
                                                                                                                                
     Section   1   Adds   language   to   conform   to   new                                                                    
     Administrative Procedures  language added by  this bill                                                                    
     to    the   Administrative    Procedures   Act    (APA)                                                                    
     adjudication section of law.                                                                                               
                                                                                                                                
     Section 2 Removes the exemption  for the Alaska Housing                                                                    
     Finance Corporation from the APA.                                                                                          
                                                                                                                                
     Section  3 Amends  the Legislature  statute to  require                                                                    
     the  legislature to  review  every proposed  regulatory                                                                    
     action before  the date the regulation  is scheduled to                                                                    
     be adopted, amended, or repealed.                                                                                          
                                                                                                                                
     Section 4  Adds a  language to the  Legislature statute                                                                    
     to  require  standing  committees  to  review  proposed                                                                    
     regulatory actions  and transmit its findings  to a new                                                                    
     division  under   the  Legislative  Budget   and  Audit                                                                    
     Committee (LB&A) established by this bill.                                                                                 
                                                                                                                                
     Section 5  Amends Fiscal Note  statute to  include LB&A                                                                    
     in agencies deadline reporting requirements.                                                                               
                                                                                                                                
     Section 6 Adds new  language to the Legislature statute                                                                    
     allow   the  Legislative   Affairs  Agency   to  review                                                                    
     proposed  regulations and  to  assign  an attorney  for                                                                    
     such review.                                                                                                               
                                                                                                                                
     Section 7 Adds new  sections to the Legislature statute                                                                    
     to create  a permanent staff agency  responsible to the                                                                    
     LB&A   Committee   for   the   purpose   of   providing                                                                    
     legislative review of  administrative regulations filed                                                                    
     by  the Lieutenant  Governor, named  the Administrative                                                                    
     Regulation Review  Division. Allows the  LB&A Committee                                                                    
     to  hire staff  and  requires  the Legislative  Affairs                                                                    
     Agency  to   provide  legal   assistance  to   the  new                                                                    
     Division. Gives  the following powers to  the Division:                                                                    
     (1) Require  state officials  to give  full cooperation                                                                    
     to the Division,                                                                                                           
     (2) Examine  all regulations to determine  whether they                                                                    
     would properly implement legislative intent,                                                                               
     (3) Prepare and distribute reports and materials,                                                                          
     (4)  Investigate  findings   submitted  by  a  standing                                                                    
     committee, and                                                                                                             
     (5)  If   necessary,  recommend  that   LB&A  introduce                                                                    
     legislation to annul adoption of regulations.                                                                              
                                                                                                                                
     Section  8   Removes  the  exemption  for   the  Alaska                                                                    
     Aerospace Corporation from the APA.                                                                                        
                                                                                                                                
     Section  9 Removes  the exemption  for  the Adak  Reuse                                                                    
     Authority from the APA.                                                                                                    
                                                                                                                                
     Section  10  Removes  the   exemption  for  the  Alaska                                                                    
     Gasline Development Corporation from the APA.                                                                              
                                                                                                                                
     Section  11  Removes  the   exemption  for  the  Alaska                                                                    
     Permanent Fund Corporation from the APA.                                                                                   
                                                                                                                                
     Section  12 Conforming  language  for  DNR state  lands                                                                    
     statute APA requirements.                                                                                                  
                                                                                                                                
     Section 13  Adds to  Public Records  statute exemptions                                                                    
     legal   communications   between  the   Executive   and                                                                    
     Legislature regarding regulatory review.                                                                                   
                                                                                                                                
     Section 14 Conforming language.                                                                                            
                                                                                                                                
     Section 15 Conforming language.                                                                                            
                                                                                                                                
     Section 16  Adds to  the Governor's  requirements under                                                                    
     the  APA   to  add  issues  raised   by  Administrative                                                                    
     Regulatory Review Division to  reasons the Governor may                                                                    
     return a proposed regulation to an adopting agency.                                                                        
                                                                                                                                
     Section  17 Adds  to public  notice requirements  under                                                                    
     the  APA   that  copies  of  proposed   regulations  be                                                                    
     furnished to the LLA when distributed to the public.                                                                       
                                                                                                                                
     Section 18-20 Conforming language.                                                                                         
                                                                                                                                
     Section  21  Adds  a  new section  to  APA  statute  to                                                                    
     require  the   Lieutenant  Governor  to   submit  filed                                                                    
     regulations  to  the Administrative  Regulatory  Review                                                                    
     Division  along  with   their  fiscal  notes,  requires                                                                    
     agencies to  submit proposed regulations to  the Review                                                                    
     Division when submitted to the  Governor, and gives the                                                                    
     Review  Division  10 days  to  submit  comments to  the                                                                    
     Governor.                                                                                                                  
                                                                                                                                
     Section 22-26 Conforming language.                                                                                         
                                                                                                                                
     Section 27 Removes the exemption  for the Alaska Energy                                                                    
     Authority from the APA.                                                                                                    
                                                                                                                                
     Section  28  Adds  to  uncodified  law  that  this  Act                                                                    
     applies  to   adoption,  amendment,  or  repeal   of  a                                                                    
     regulation  that  is first  proposed  on  or after  the                                                                    
     effective date of this Act.                                                                                                
                                                                                                                                
2:39:45 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CARPENTER explained  that the  legislature, while                                                               
in session, is mostly consumed  with bills drafted during session                                                               
and has little time for regulatory  review.  He noted there would                                                               
likely  be  a  fairly  substantial fiscal  note  associated  with                                                               
setting up  a permanent division  to do this task.   Nonetheless,                                                               
he said if  better, more efficient governance is  the goal, there                                                               
should be a permanent division  to review regulations that can be                                                               
costly in time and action within the public sector.                                                                             
                                                                                                                                
2:41:51 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SUMNER said  he liked the legislation.   He sought                                                               
asked  whether   Sections  3  and  4,   which  directed  standing                                                               
committees  to take  certain action,  would be  considered intent                                                               
language.                                                                                                                       
                                                                                                                                
REPRESENTATIVE  CARPENTER confirmed  that  the Regulatory  Review                                                               
Division  would  not have  the  authority  to direct  legislators                                                               
within a standing committee to take action.                                                                                     
                                                                                                                                
2:42:48 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GRAY  asked how  the proposed  legislation relates                                                               
to the "sunset commission bill."                                                                                                
                                                                                                                                
REPRESENTATIVE  CARPENTER   said  the   two  entities   would  be                                                               
completely different.   The proposed sunset  commission, composed                                                               
of commissioners  appointed by the governor  and the legislature,                                                               
would  be  created  underneath   the  Office  of  the  Lieutenant                                                               
Governor  to  review departments  over  time.   Conversely,  this                                                               
division would  fall underneath the Legislative  Budget and Audit                                                               
Committee for the purpose of reviewing new regulations.                                                                         
                                                                                                                                
REPRESENTATIVE GRAY speculated that  the staff would be entrusted                                                               
to  do  the  work.   He  asked  what  would  be expected  of  the                                                               
legislators and full-time staff.                                                                                                
                                                                                                                                
REPRESENTATIVE  CARPENTER  explained   that  if  [the  Regulatory                                                               
Review Division] were  created, there would be  staff, similar to                                                               
[Legislative Finance  Division], with  a mission and  a director.                                                               
The  division's work  would  be  reported to  the  chair [of  the                                                               
Legislative  Budget  and  Audit   Committee].    He  likened  the                                                               
proposed division to a standing  committee with a full-time staff                                                               
existing  under  Legislative  Budget   and  Audit  Committee  for                                                               
interim supervision to pursue regulatory review.                                                                                
                                                                                                                                
REPRESENTATIVE GRAY asked whether there  would be a framework for                                                               
the division of labor.                                                                                                          
                                                                                                                                
REPRESENTATIVE CARPENTER  said the  sooner it starts,  the sooner                                                               
it's finished.   He acknowledged  that there  would need to  be a                                                               
division of effort and prioritization.                                                                                          
                                                                                                                                
2:48:40 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SUMNER  shared his  understanding that  there used                                                               
to  be a  special  House  committee for  regulatory  review.   He                                                               
suggested creating a special or  permanent standing committee for                                                               
regulatory review.                                                                                                              
                                                                                                                                
REPRESENTATIVE  CARPENTER  said  the  focus  of  the  Legislative                                                               
Budget and  Audit Committee is  work during interim,  whereas for                                                               
standing committees,  it's not.   He argued that with  a standing                                                               
committee, it could be a  challenge to find initiative during the                                                               
interim.                                                                                                                        
                                                                                                                                
REPRESENTATIVE  SUMNER suggested  that  there could  be value  in                                                               
creating  a standing  committee  to receive  referrals for  bills                                                               
promulgating  the  creation  of   new  regulatory  structures  in                                                               
statute.                                                                                                                        
                                                                                                                                
REPRESENTATIVE  CARPENTER acknowledged  that, arguably,  the same                                                               
effect could  be achieved by  creating a standing  committee, but                                                               
there would still need to be full-time staff to do the work.                                                                    
                                                                                                                                
2:52:39 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  C. JOHNSON  recalled  that the  problem with  the                                                               
[Administrative Regulation  Review Committee]  was the  change in                                                               
membership  every  two  years;  consequently,  certain  vendettas                                                               
against  certain things  politicized the  committee and  hindered                                                               
its functionality and efficiency.                                                                                               
                                                                                                                                
2:54:07 PM                                                                                                                    
                                                                                                                                
CHAIR VANCE questioned the current  process for regulation review                                                               
by the legislature.                                                                                                             
                                                                                                                                
REPRESENTATIVE CARPENTER  said the process  is spelled out  in AS                                                               
04.25.182.                                                                                                                      
                                                                                                                                
CHAIR VANCE  questioned how the  bill would impact the  length of                                                               
time  it takes  to adopt  new regulations.   She  asked the  bill                                                               
sponsor  to   clarify  the  relationship  between   the  proposed                                                               
division  and the  process of  reviewing regulation  in the  next                                                               
bill hearing.                                                                                                                   
                                                                                                                                
[HB 278 was held over.]