HB 140-NOTICE FOR REGULATION ADOPTION  2:35:14 PM CHAIR KELLER announced that the final order of business would be HOUSE BILL NO. 140, "An Act relating to the information that must be included with certain notices provided for the proposed adoption, amendment, or repeal of a regulation." 2:35:32 PM REPRESENTATIVE LORA REINBOLD, Alaska State Legislature, explained that HB 140 is intended to address what many consider to be too many regulations. The purpose of HB 140 is to make the government and the regulators aware of the impacts of the regulations. She opined that government agencies and regulators need to work collaboratively with businesses and communities and be reminded that they work for the people. Representative Reinbold then paraphrased from the written sponsor statement, which read: Under current law, state agencies that propose changes to the Alaska Administrative Code, our state regulations, are required to disclose certain information about the regulation, including the reason for the proposed action, costs of implementation of the regulation to the adopting agency and the origin of the proposed regulation. To provide better information about regulations that may significantly affect private individuals and businesses, other state agencies and local governments, House Bill 140 requires that regulation notices include information about estimated costs beyond those to the agency. In view of the increasing reach of the Washington D.C. into Alaska's affairs, the bill also requires that when the federal government is the reason for the regulation, the exact federal law, executive order or decision be identified in order for Alaskans to better understand government actions that affect their businesses and lives. Open government is a great American and Alaskan tradition. I respectfully request your support for House Bill 140. REPRESENTATIVE REINBOLD then highlighted the letters of support from the Council of Alaska Producers and the National Federation of Independent Business/Alaska in members' packets and stated that there are more letters of support to come. 2:40:45 PM ROBERT PEARSON, Staff, Representative Lora Reinbold, Alaska State Legislature, paraphrased from the following sectional analysis, which read: Sec. 1 Short title: "Regulation Impact Transparency Act." House Bill 140 will require additional information in state agency notices of proposed regulations, specifically to increase transparency of the proposal's fiscal impacts, including to the private sector. Sec. 2 Under current Alaska Statutes 44.62.190(d) the agency is required to provide a "reason for the proposed action." If the reason given is "federal," HB 140 will require identification of the federal action that is the reason for the proposed regulation. It also adds a requirement to estimate compliance costs to private persons (including private businesses), other state agencies and municipalities. Sec. 3 Applicability: applies to regulations proposals noticed on or after the effective date of this act. MR. PEARSON then directed attention to the document entitled "What does HB 140 do?" and noted that it's a notice of proposed regulations. Page 2 of this document is what's known as additional regulations notice information under AS 44.62.190(d), which is the only part of the law that will be changed by HB 140. As specified on page 2, Section 2(1) will require the state agency supply a reference/citation of the federal law or other action that could include anything from an executive order to the combined federal register. The only other change HB 140 would make is to insert Section 2(3)(A),(B), and (C), which would require the estimated costs to private individuals, other state agencies, and municipalities will be included in the regulation notice. 2:44:06 PM MR. PEARSON pointed out that the fiscal note for HB 140 is indeterminate and highlighted the fiscal note analysis language that says, "... more detail is needed as to whether the estimate required is a general estimate of impacts for a group or set of municipalities or for each individual municipality, etc." He offered his belief that the language in HB 140 is clear when it refers to an estimate of annual costs. He acknowledged, however, that it isn't a number encompassing every person in the state who may be impacted by the regulations but rather is simply an estimate of costs to the impacted entities. The agencies should be able to make an estimate based on their knowledge of the regulations and community to which the regulations apply. 2:45:57 PM CHAIR KELLER expressed favor with HB 140. 2:46:22 PM REPRESENTATIVE MILLETT said she likes the concept of HB 140. She then asked who would be responsible for making the estimates of annual costs. If the Office of Management & Budget is responsible for making the estimates, she surmised that the workload would increase significantly or an economist would have to be added to each department. MR. PEARSON answered that the sponsor doesn't anticipate major personnel requirements for this change. He noted that the regulations notice always has a signature at the bottom of a regulations specialist, assistant to the commissioner who, in effect, is the one who signs the estimate. However, in each department that promulgates regulations, there are those who have expertise in the area being regulated. The regulation specialist would ask for the necessary information to provide the estimate and put it in the notice. The thought is that the departments know the regulated community and who they're regulating and should know to some degree when they propose a regulation whether it will cost the public or other state agencies and include that information. REPRESENTATIVE LEDOUX expressed interest in hearing whether departmental commissioners would anticipate an increase in staff. MR. PEARSON deferred to others who may be better able to address that question. 2:49:25 PM REPRESENTATIVE REINBOLD relayed that she is willing to work with DOL to develop language that would make this legislation possible. She then emphasized the need for the state to identify from where the regulations are coming and do long-term thinking. She mentioned that as chair of the Administrative Regulation Review Committee she plans to hold hearings on this issue, and thus there should be more information forthcoming. CHAIR KELLER expressed interest in hearing from the Alaska Municipal League (AML), particularly since the legislature does impose mandates that cost [municipalities] money. 2:50:51 PM REPRESENTATIVE LEDOUX inquired which department promulgates the most regulations. MR. PEARSON answered that the Department of Commerce, Community & Economic Development (DCCED), with its licensing and professional boards, is the largest promulgator of regulations. REPRESENTATIVE LEDOUX suggested that the commissioner of DCCED be invited to speak at the next hearing on HB 140. 2:51:53 PM CATHY P. FOERSTER, Chair, Alaska Oil & Gas Conservation Commission (AOGCC), Department of Administration, provided the following testimony: From the perspective of the AOGCC HB 140 is problematic in its current wording. The commission does not wish to be in the position of conceding that federal law or a federal court decision does or even could require us to promulgate regulations. And I think that statement speaks for itself, it sets a state's rights precedent that is counter to where we [AOGCC] sit; we make regulations based on what's best for the citizens of Alaska, based on what we do here in Alaska. MS. FOERSTER then expressed AOGCC's concern that it doesn't have the time, resources, or expertise to make a determination as to the economic impact on all the listed entities. The AOGCC, she highlighted, has a process in place such that during the promulgation of regulations ample public notice of the proposed regulations, additions, or changes is included. Furthermore, hearings on those changes are noticed and written comments before or during the hearing are welcome as is testimony at the hearing itself. She noted that generally lots of comments, including the parties' estimates of the economic impact of any regulation changes are received. The process, she opined, works really well, even though the AOGCC doesn't have financial experts. From conversations with DOL, Ms. Foerster related her understanding that with a bit of collaborative "tweeking" AOGCC's concerns with HB 140 can be addressed. Ms. Foerster clarified that she isn't stating opposition to HB 140 but rather believes it should receive the thought and attention necessary to ensure that it says what is desired. 2:55:01 PM CHAIR KELLER announced that HB 140 would be set aside. REPRESENTATIVE REINBOLD related her expectation for push back from the government as it's not accustomed to "looking down the road." Therefore, Representative Reinbold said she is willing to work with the departments in hopes that they are willing to partner with industry in order to move the state forward toward the goal of a long-term sustainable future for the state.