04/16/1998 03:37 PM Senate STA

           CSHB 264(FIN) - NEGOTIATED REGULATION MAKING                        
                                                                               
CHAIRMAN GREEN brought CSHB 264(FIN) before the committee as the               
final order of business.                                                       
                                                                               
WALT WILCOX, staff to Representative Jeannette James who is prime              
sponsor of HB 264, said the legislation enables and encourages                 
negotiated regulation/rule making.  Currently, negotiated                      
regulation making is in use by the Federal Government, the states              
of Montana and Nebraska, as well as several other states.                      
                                                                               
Mr. Wilcox stated that the citizens of Alaska have been hounding               
Representative James and the Administrative Regulation Review                  
Committee for changes in the regulation review process  for several            
years, and this is one solution wherein regulations that are very              
complex can bring the impacted parties to the table prior to the               
promulgation of the regulations, bringing in industry and other                
interested parties to help formulate their ideas and policies for              
the regulations before they are actually written.                              
                                                                               
Mr. Wilcox related that with the current process, the commissioner             
promulgates the regulations and puts them out for public hearing               
and they are somewhat cast in concrete.  HB 264 will provide the               
opportunity, especially in complex regulations such as air regs,               
water regs and airport regs, to bring the impacted members in                  
first.  The Administrative Procedures Act will be followed after               
the process.  It is purely a voluntary process to be used or not               
used by the commissioner.   Although it will cost more up front to             
do, it appears that it will cost less in the long run.                         
                                                                               
Mr. Wilcox pointed out that the Administration is in support of HB
, and he noted Deborah Behr of the Department of Law has been               
working closely with the sponsor on the drafting of the                        
legislation.                                                                   
                                                                               
Number 255                                                                     
                                                                               
CHAIRMAN GREEN asked how the process works under negotiated rule               
making.                                                                        
                                                                               
DEBORAH BEHR, Assistant Attorney General, Department of Law, said              
negotiated rule making is not what would be done in the average                
rule making process because it involves calling a committee                    
together, having the committee meet, so it is intended to be for               
the larger more complex projects.                                              
                                                                               
Outlining the process, Ms. Behr explained that the commissioner                
would decide, based on their factors, whether negotiated rule                  
making would be appropriate under the circumstance.  After the                 
commissioner decides whether or not it is appropriate to have                  
negotiated rule making, the commissioner would give notice to the              
public of the intent to set up a committee.  Once the committee is             
selected, the agency puts someone on the committee who could speak             
for the department and would have a sense of what is going on                  
there.  The committee meets in a public meeting and issues a report            
if they reach consensus.  If a committee consensus is not reached,             
then there would be a majority and a minority report and the                   
commissioner could pick and choose what is appropriate.  The                   
entire APA process is then initiated.  The commissioner makes the              
ultimate decision on the negotiated regulation and, at that point,             
it goes to through the Department of Law for review before going to            
the Lieutenant Governor's office.                                              
                                                                               
Ms. Behr said the intent of negotiated regulation/rule making is to            
bring more people into the process.  She added that she is a firm              
believer that the more people involved, the more information people            
bring into the process, information that the committee might not               
otherwise have access to in developing a regulation.                           
                                                                               
Number 333                                                                     
                                                                               
PAM LA BOLLE, representing the Alaska State Chamber of Commerce,               
stated they think the idea of the process of is commendable, but               
they do have three concerns with the legislation.  Those concerns              
include:                                                                       
                                                                               
                                                                               
(1)  The legislation is open ended as far as a time frame.  If the             
negotiation process continued over a long period of time, a lot of             
company time and resources could be eaten up;                                  
                                                                               
(2)  The individual serving on the committee at the start of a                 
negotiation process should be the same one who finishes that                   
process; and                                                                   
                                                                               
(3)  There is concern that if industry does not want to participate            
in the process, a substitute for industry  that doesn't really                 
adequately represent industry will be brought in  and thereby                  
forcing the industry to come to the table.                                     
                                                                               
Ms. La Bolle said the Alaska State Chamber would like to see some              
parameters put on how large this process would become and how long             
it could go on, and that it truly be voluntary so no one can be                
forced to participate.                                                         
                                                                               
Number 396                                                                     
                                                                               
SENATOR MACKIE asked Ms. La Bolle if she had discussed these                   
concerns with the sponsor and staff.  MS. LA BOLLE answered that               
she had not had the opportunity to do so as yet.  MR. WILCOX said              
he thought her concerns could be worked out with one small                     
amendment.                                                                     
There being no further testimony on HB 264, CHAIRMAN GREEN stated              
the legislation would be held in committee until the following week            
for a possible amendment.  She then adjourned the meeting at 4:12              
p.m.