Legislature(2003 - 2004)

02/10/2004 03:30 PM STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                    SB 287-REGULATION REVIEW                                                                                
CHAIR GARY STEVENS  announced SB 287 to be  up for consideration.                                                               
He stated  the committee  was hearing the  bill at  the sponsor's                                                               
request, but he  didn't intend to take action that  day. He asked                                                               
Senator Therriault to step forward.                                                                                             
SENATOR  GENE  THERRIAULT,  sponsor   of  SB  287,  explained  he                                                               
introduced  this bill  as a  result of  his work  on a  different                                                               
piece of  legislation relating to  regulations formation  and the                                                               
public's  perception  of  the regulatory  process.  That  bit  of                                                               
legislation deals  with the standards  citizens are held  to when                                                               
they appeal  a decision  made under regulation.  It's the  end of                                                               
the  process when  the  regulation is  being  implemented and  is                                                               
having consequences for constituents, he said.                                                                                  
Because of  that work, he  began to  look at how  the Legislature                                                               
interacts  with  regulations  as  they are  formed.  He  referred                                                               
members  to the  flow chart,  "Steps in  the Regulation  Adoption                                                               
Process,"   and   pointed  out   that   sometimes   there  is   a                                                               
misinterpretation of the legislative intent  when an agency works                                                               
with legislators  then proposes a regulation.  It's upsetting for                                                               
constituents  to  work  on  legislation only  to  find  that  the                                                               
regulation  has taken  an  unexpected turn.  At  that point,  the                                                               
Legislature has  the choice  of working  to change  the direction                                                               
the regulation  is headed  through the  public comment  period or                                                               
pass another piece of legislation.                                                                                              
He and  his staff began  to explore  formalizing the role  of the                                                               
Legislature for  input or  notification. This  is not  to control                                                               
the  process, he  quickly insisted,  because  regulations are  an                                                               
administrative function  and with  the separation of  powers, the                                                               
Legislature   has  no   constitutional  power   to  control   the                                                               
regulatory process. However,  he would like to  explore the early                                                               
input  option so  that if  the  body that  passed the  underlying                                                               
statute  believed there  was some  misinterpretation, they  could                                                               
take corrective steps early in the process.                                                                                     
SB 287 would insert legislative  legal attorneys into the process                                                               
between step 4 and 5 in the  flow chart. In step 4 the Department                                                               
of Law  opens the  file and  in step 5  the agency  publishes and                                                               
distributes  public notice,  additional  notice information,  and                                                               
He  admitted that  Lt. Governor  Leman  and his  staff have  some                                                               
concerns   with  the   separation   of  powers   issue,  but   he                                                               
reemphasized it  isn't his  intent to  insert the  Legislature in                                                               
any   controlling   manner.   It's   an   opportunity   to   work                                                               
cooperatively with the administration to avoid difficulties.                                                                    
Legitimate concerns relate to the Board  of Game and the Board of                                                               
Fish.  If citizen  groups are  suggesting changes  to regulations                                                               
the boards oversee,  the board reviews and  selects the proposals                                                               
they want to move forward.  He clarified, "It certainly would not                                                               
be in my  intent that our legislative legal  attorneys review all                                                               
of those proposed regulations that are brought to the boards."                                                                  
Specifically,  he  said,  he was  interested  in  addressing  new                                                               
legislation   that  is   implemented  through   the  passage   of                                                               
regulations.  This is  when the  legislative  attorneys would  be                                                               
With  regard  to the  fiscal  impact  of  the bill  as  currently                                                               
structured, he said  he expected to receive the  same advice from                                                               
the Finance  Committee co-chair  that he  used to  dispense. That                                                               
is, "Great  idea, cost's  too much.  Come back  when you  get the                                                               
cost down."                                                                                                                     
SENATOR THERRIAULT admitted that  controlling costs might involve                                                               
a blend of the current  system with the Administrative Regulation                                                               
Review  Panel and  early notification  or  solicitation of  input                                                               
into the process.                                                                                                               
SENATOR  JOHN COWDERY  questioned whether  legislative legal  has                                                               
sufficient staff  to handle the  additional workload or  is extra                                                               
staff included in the fiscal note.                                                                                              
SENATOR THERRIAULT  replied the  expense of  additional positions                                                               
is   something  that   needs  evaluation.   He  noted   that  the                                                               
legislative legal  staff has  slack time  during the  interim and                                                               
perhaps this function could be performed then.                                                                                  
SENATOR  COWDERY asked  how  long  it would  take  to review  the                                                               
regulations and give the public time to comment.                                                                                
SENATOR THERRIAULT opined the legal  review could be completed in                                                               
a  week or  two. He  pointed to  the practice  of one  department                                                               
holding  another  hostage  and  stated with  certainty  that  the                                                               
Legislature doesn't have the constitutional  power to hold up the                                                               
process in that  fashion. Ideally, the same  attorney that worked                                                               
with  legislators  in  drafting  the   bill  would  look  at  the                                                               
regulations and give  an opinion as to whether  they were backing                                                               
up the stated legislative intent in the new law that was passed.                                                                
Although it's  not necessary, it's  not uncommon  for legislators                                                               
to  solicit opinions  from the  Attorney  General's Office  (AG).                                                               
There's  no requirement  for legislators  to follow  that advice,                                                               
but  they certainly  do  take it  into  consideration because  it                                                               
doesn't  make sense  to take  steps  that would  lead to  certain                                                               
legal challenge.  If the regulation  writers got a memo  from our                                                               
legislative legal  shop saying,  "You're missing the  boat here."                                                               
They would listen  in the hope that it would  save headaches down                                                               
the line.  It could avoid  backlash from the public  that thought                                                               
they  knew  what  to  expect  when  they  supported  a  piece  of                                                               
legislation, but the regulation went in a different direction.                                                                  
SENATOR COWDERY asked  how many regulations are  established in a                                                               
SENATOR THERRIAULT  replied Mr.  Stancliff could  probably answer                                                               
that question.                                                                                                                  
DAVE  STANCLIFF,  staff  to   the  Regulation  Review  Committee,                                                               
reported that  Senator Therriault tasked  him with finding  a way                                                               
to  bring  about positive  changes  in  the process  through  the                                                               
regulatory  reform process.  A good  process works  well for  any                                                               
political persuasion and deals with  the balance of power between                                                               
the Executive Branch of government  and the Legislative Branch of                                                               
MR. STANCLIFF reported that the  regulatory process that Colorado                                                               
employs  is  one  of cooperation.  Their  legal  services  aren't                                                               
adversarial  with the  Attorney General's  Office and  that's the                                                               
model in SB 287.                                                                                                                
He  suggested that  the system  in Alaska  doesn't have  the same                                                               
level of balance  that other states have  with regulatory review.                                                               
First, it's not uncommon to hear  that an agency regulator told a                                                               
disgruntled citizen  that if they  didn't like a  regulation they                                                               
should speak  to their legislator  because that's who  passed the                                                               
bill  that  made  the department  establish  the  regulation.  He                                                               
admitted  that  is  sometimes  valid, but  many  times  it's  not                                                               
because the  regulation that's causing  the heartburn  has little                                                               
to do with the statute that was passed.                                                                                         
The other imbalance  is that the Attorney  General's Office isn't                                                               
involved  until after  the public  comment period.  Currently the                                                               
public  is  given  an  opportunity  to  comment  on  an  agency's                                                               
proposed  regulation  after which  it  is  sent to  the  Attorney                                                               
General's Office for review. If  that office finds fault with the                                                               
regulation, it is  remanded back to the agency  for repair. After                                                               
the repair, the  commissioner decides whether or not  to send the                                                               
proposed  regulation  back  through the  public  comment  period.                                                               
Often the  decision is to  skip additional public comment  so the                                                               
regulation  continues through  the process  and becomes  law. The                                                               
result is  that the  public sees a  regulation that  is different                                                               
than the one they commented on.                                                                                                 
In response  to Senator Cowdery's  questions, he said  the fiscal                                                               
note calls  for three  full time attorneys,  which would  be very                                                               
costly if  you weren't sure of  a good return. He  estimated that                                                               
the number of regulations per year is well over 1,000.                                                                          
In Colorado, regulation writers realized  their work was going to                                                               
be screened  by the Legislative Branch.  Regulations were written                                                               
more carefully,  there weren't as  many. The process  saved money                                                               
from the start to the end  because they didn't send as many back,                                                               
they weren't  adjudicated the same  way because they  were better                                                               
quality regulations.  The investment climate in  Colorado changed                                                               
Using  the fishing  industry  as  an example  he  noted how  much                                                               
impact one  regulation can have  in a sensitive  and multimillion                                                               
dollar  industry. Clearly,  it's important  to get  it right  the                                                               
first time.                                                                                                                     
With  regard  to costs  he  thought  that  they would  come  down                                                               
significantly if fish and game were  left out. "I think you might                                                               
eliminate one of those positions," he said                                                                                      
DEBORAH BEHR,  regulations attorney  with the Department  of Law,                                                               
said  she  and   Annette  Kreitzer  were  there   to  talk  about                                                               
regulatory  reform and  better  interactions  with the  Executive                                                               
Branch. She  stated agreement  with Senator  Therriault's premise                                                               
that it's  necessary to  cooperate for  regulations to  be better                                                               
developed and more responsive to the public.                                                                                    
She  expressed the  opinion that  everything that's  in the  bill                                                               
could be done  without a statute and she firmly  believes that if                                                               
a new  statute isn't  need, you  shouldn't put a  new one  on the                                                               
She said she would be  working with Senator Therriault's staff to                                                               
determine  whether they  were looking  for a  policy review  or a                                                               
lawyer's review. She has reviewed  legislation and found it to be                                                               
perfectly  legal, but  then  had to  ask  the commissioner  which                                                               
policy direction  he or she  wanted to  take. At that  point, the                                                               
commissioner talks to policy experts  who are usually not lawyers                                                               
and selects the policy direction.                                                                                               
MS. BEHR  suggested that the  committee decide whether  they want                                                               
to  invest  expensive  lawyer  dollars  in  looking  at  all  the                                                               
regulations  in the  state. Certainly,  she  asserted, there  are                                                               
regulations such as  local hire and complex  tax regulations that                                                               
would  require  a  lawyer,  but  some  sort  of  prescreening  by                                                               
legislative staff or  other non-lawyers would make  better use of                                                               
your legal services dollars.                                                                                                    
She said she would talk  to staff about the standards legislative                                                               
legal is supposed  to be using as compared to  the standards that                                                               
the  Department of  Law is  supposed  to use  because they  don't                                                               
mesh. For  example, legislative legal doesn't  look at compliance                                                               
with drafting legal styles.                                                                                                     
Another concern  is what happens  when legislative legal  is busy                                                               
and the provision  is for a mandatory review and  they don't have                                                               
the  staff  to  conduct  the  review  in  a  timely  fashion.  An                                                               
unintended consequence might  be that a third  party would charge                                                               
that the regulations are somehow  flawed because the statute says                                                               
legislative legal shall review the regulations.                                                                                 
MS.  BEHR  noted that  several  agencies  have expressed  concern                                                               
about  regulation  delays so  discussions  should  take place  to                                                               
decide what  to include.  Certainly there's  a difference  in new                                                               
legislation  and legislation  that  is for  cost containment  and                                                               
right now most of the bills  she is reviewing deal with trying to                                                               
get the state statutes to match a pared down budget. She said,                                                                  
     I don't  want to  have the  department waiting  to hear                                                                    
     from legislative legal and then  missing time - a month                                                                    
     or two - in implementing  a policy call the Legislature                                                                    
     made  to pare  down  a budget.  This  is of  particular                                                                    
     concern in the understaffed  areas of health and social                                                                    
     services.  If  you miss  a  month  in Medicaid,  you're                                                                    
     talking about millions of dollars.                                                                                         
She advised  that the Department of  Law has a budget  request in                                                               
for  a lawyer.  It's  much  easier for  the  Executive Branch  to                                                               
garner federal  dollars for  legal resources than  it is  for the                                                               
Legislative Branch. "So  if you believe there is a  need for more                                                               
legal resources, that certainly is  a possibility and at any time                                                               
you found a regulation you were  troubled with and wanted a legal                                                               
opinion,  certainly the  Department of  Law is  the resource  for                                                               
She  then  brought  up  a technical  concern  related  to  public                                                               
records. Because  the attorneys at legislative  legal aren't part                                                               
of  the Executive  Branch, there  isn't  a clear  attorney-client                                                               
privilege. It  isn't entirely  clear that  an opinion  written by                                                               
legislative  legal wouldn't  be  a  discoverable document,  which                                                               
could be very problematic on a complex oil regulation.                                                                          
Next she brought  up the applicability of  regulations in process                                                               
pointing out that several industries  are waiting for regulations                                                               
and there isn't a section in the bill to address that.                                                                          
She concluded  her remarks saying  that it is important  that the                                                               
Legislature wants  to better interface with  the Executive Branch                                                               
and   she  reemphasized   that  comments   legislators  make   on                                                               
regulations are considered strongly and evaluated seriously.                                                                    
ANNETTE KREITZER,  chief of staff  to Lt. Governor  Leman, stated                                                               
that the  Lt. Governor appreciates Senator  Therriault's interest                                                               
in reviewing  how regulations  are promulgated  and when  and how                                                               
legislators have an  impact on the process. That  being said, she                                                               
admitted that  she's a bit  baffled when her office  doesn't hear                                                               
from  legislators during  the public  comment period  because the                                                               
public  includes legislators.  The  departments would  absolutely                                                               
take those comments very seriously, she said.                                                                                   
She showed members a regulation packet  and said it lists all the                                                               
legislators  that  got the  notice  about  the regulations  being                                                               
proposed in  response to HB  271, which was passed  last session.                                                               
There was  ample opportunity to  comment yet there is  nothing in                                                               
the packet reflecting that a single legislator had a comment.                                                                   
The Lt. Governor has assured  Senator Therriault that if there is                                                               
something  about the  process  that doesn't  work,  such as  more                                                               
training for  staff or new  legislators, they're very  willing to                                                               
work  with   him  to  accomplish   his  desire  to   ensure  that                                                               
legislators are involved early on.                                                                                              
TAPE 04-4, SIDE A                                                                                                             
5:00 pm                                                                                                                       
CHAIR GARY STEVENS asked Ms.  Behr about her concern about delays                                                               
and whether  she had considered  what options might  be available                                                               
to address the delay.                                                                                                           
MS. BEHR clearly  stated that this bill doesn't  stop anyone from                                                               
going  forward   with  a  project  while   legislative  legal  is                                                               
reviewing. However, she said if  she were commissioner of Revenue                                                               
and she knew  that legislative legal was  looking at regulations,                                                               
she'd probably wait for that legal review before proceeding.                                                                    
She  repeated that  a screening  process would  help address  the                                                               
issue of  how quickly  a review  could be  completed. Legislative                                                               
legal  attorneys  should  neither  spend time  looking  at  minor                                                               
regulations that don't require an  attorney's expertise nor spend                                                               
time doing legal research that  the Department of Law isn't going                                                               
to use.                                                                                                                         
CHAIR  GARY  STEVENS  thanked everyone  for  their  comments  and                                                               
announced  SB  287 would  be  heard  again  in the  future.  With                                                               
nothing further  to come before  the committee, he  adjourned the                                                               
meeting at 5:15 pm.                                                                                                             

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