HB 229-REPEAL ADMIN. REG. REVIEW COMMITTEE  8:23:24 AM CHAIR LYNN announced that the next order of business would be HOUSE BILL NO. 229, "An Act relating to regulation notice and review by the legislature; and relating to the Administrative Regulation Review Committee." [Left pending from the House State Affairs Standing Committee meeting on 3/15/16 was a motion by Representative Keller to adopt Amendment 2, labeled 29-LS1104\A.4, Gardner, 3/10/16, with an objection by Representative Stutes for the purpose of discussion. The pending objection to the motion to adopt Amendment 2 was treated as withdrawn.] [Because of their length, some amendments discussed or adopted during the meeting are found at the end of the minutes for HB 229. Shorter amendments are included in the main text.] 8:24:59 AM REPRESENTATIVE MIKE CHENAULT, Alaska State Legislature, as prime sponsor of HB 229, indicated that he had no objection to Amendment 2, by Representative Keller. He said he had a few concerns that could be addressed. 8:25:39 AM REPRESENTATIVE KELLER moved to adopt Amendment 1 to Amendment 2, labeled 29-LS1104\A.5, Gardner, 3/16/16. [Amendment 1 to Amendment 2 is provided at the end of the minutes on HB 229. The difference between Amendment 2 and Amendment 1 to Amendment 2 is the addition of Section 4, subsection (h), on page 3, lines 17-21, as numbered on Amendment 1 to Amendment 2.] REPRESENTATIVE TALERICO objected for purpose of discussion. 8:26:25 AM JIM POUND, Staff, Representative Wes Keller, Alaska State Legislature, on behalf of Representative Keller, said that Amendment 1 to Amendment 2 addresses a concern regarding the effect that HB 229 would have on the ability of the Board of Game and the Board of Fisheries to pass regulations. He indicated that the language [in question] was on page 2, beginning on line 27 [as numbered on Amendment 1 to Amendment 2] and was in Section 4, subsection (f) [of Amendment 2]. The proposed amendment addresses that concern [by the addition of subsection (h)]. He offered that the Twenty-Eighth Alaska State Legislature previously addressed this same concern in passing House Bill 140 in which exemptions were made for the following quasi-judicial agencies: the Board of Game, the Board of Fisheries, the Regulatory Commission of Alaska (RCA), and the Alaska Oil and Gas Conservation Committee (AOGCC). He stated that Amendment 1 to Amendment 2 would allow the regulations and the regulatory process within these agencies to remain intact. 8:27:36 AM REPRESENTATIVE KREISS-TOMKINS remarked that Amendment 1 to Amendment 2 was lengthy and included many citations. He queried whether the committee might benefit from a more detailed explanation of the entire amendment. He also asked which document was being called Amendment 1 to Amendment 2. 8:28:06 AM MR. POUND clarified that the document labeled A.5 was Amendment 1 to Amendment 2. 8:28:52 AM REPRESENTATIVE KELLER, in response to Representative Kreiss- Tomkins, maintained that the committee had already heard a detailed explanation of Amendment 2. He recommended adoption of Amendment 1 to Amendment 2 for further discussion. 8:29:23 AM REPRESENTATIVE TALERICO withdrew his objection. There being no further objection, Amendment 1 to Amendment 2 was adopted. 8:29:34 AM REPRESENTATIVE KELLER, in response to Chair Lynn, clarified that the committee members now had Amendment 2, as amended, before them for discussion. 8:29:50 AM MR. POUND explained that [Amendment 2, as amended] would change the title of HB 229, in Section 1, by inserting "providing for legislative review, amendment, approval, disapproval, annulment, and delay of proposed agency regulations", following "legislature;", on page 1, line 1. He stated that Section 3 would be renamed Section 2, and that Section 2 would put AS 44.62.320(d) back into the statute - that is, review of regulations by the legislature. He added that Section 2 would authorize without question the jurisdiction of committees to review proposed regulations. Mr. Pound referred to Section 3, subsection (d), and noted the 35-day time period for committees to take action on a regulation, after which time a department could proceed with implementation. He pointed out that 35 days is within the normal public comment period. MR. POUND continued by describing the process by which the legislature could temporarily disapprove a regulation, outlined in Section 4 of Amendment 2. This process would allow a department to amend a regulation to comply with legislative intent or, if the department refused, would delay the regulation until the next legislative session, at which time the committee could introduce legislation to disapprove the regulation. Mr. Pound stated that Section 3 consists of the review criteria for a regulation - that is, the regulation meets the requirements of the statute, follows legislative intent, and meets certain cost requirements. He stated that Section 3 returns AS 44.62.320(d) to the statute. MR. POUND referred to Section 10 of Amendment 2, which states that the departments must review any amendments proposed by the legislature and, if no action is taken during the legislative session, the regulation would be implemented the day after the end of session. He also noted that Section 10 states that regulations would be submitted to the presiding officer of each house, since HB 299 would eliminate the Administrative Regulation Review Committee. Mr. Pound then referred to Section 12, which explains that new language for regulations would be displayed in the same format as new language for legislation for ease of review. MR. POUND explained that through the changes in Section 13 of Amendment 2, the proposed legislation would require the department to provide fiscal notes on regulations detailing how much a regulation would cost the department, the division, and the public. He went on to cite Sections 16 and 17 which would require the cost information to be submitted to presiding officers who in turn would submit the information to the committee of jurisdiction for review. Mr. Pound said that Section 18 states that the presiding officers would receive a copy of the regulations in a timely manner, and Section 19 details the annulment process, already described. 8:37:52 AM REPRESENTATIVE KREISS-TOMKINS asked Mr. Pound to verify that under the proposed Amendment 2 the annulment process would be as follows: if a committee voiced disapproval of a proposed regulation, the regulation would not be implemented until the end of the legislative session giving the committee the opportunity to put forth legislation that would effectively nullify the proposed regulation, and then, if the legislature failed to pass legislation to nullify the regulation, the regulation would go into effect at the adjournment of the session. MR. POUND agreed but stressed that the committee would not be able to annul a regulation. He stated a committee could put a hold on the implementation of a regulation. 8:39:04 AM REPRESENTATIVE VAZQUEZ lamented there had been little time to review the eight-page amendment. She asked how emergency regulations would be handled by the proposed amendment. MR. POUND responded that the only change made by the adopted Amendment 1 to Amendment 2 [by Amendment 1] is found in Section 4, subsection (h), on page 3, lines 17-21, and names the organizations that would be exempt [from regulation suspension] - Board of Fisheries, Board of Game, RCA, AOGCC, Office of Victims' Rights (OVR), and the Alaska Office of the Ombudsman - and also mentions the exemption for emergency regulations. REPRESENTATIVE VAZQUEZ asked whether the proposed amendment includes emergency regulations from the Department of Health and Social Services (DHSS), Division of Public Health (DPH). MR. POUND confirmed that emergency regulations are included in the proposed amendment. REPRESENTATIVE VAZQUEZ asked if an agency can decide to name a regulation as an emergency regulation to be included in the exemption. MR. POUND responded that there is existing language in AS 44.62 regarding emergency regulations, and if a department wished to extend them, it would have to go through the regulatory process. 8:42:35 AM The committee took an at-ease from 8:42 a.m. to 8:43 a.m. 8:43:49 AM REPRESENTATIVE VAZQUEZ referred to AS 44.62.250, titled "emergency regulations", which states that departments are allowed to issue emergency regulations if, and she quoted from the statute, "necessary for the immediate preservation of the public peace, health, safety, or general welfare." 8:44:30 AM REPRESENTATIVE STUTES removed her objection to Amendment 2, as amended. Without further objection, Amendment 2, as amended, was adopted. REPRESENTATIVE KELLER called attention to the copy of an e-mail in the committee packet, addressed to Mr. Pound, staff to Representative Keller, and Nancy Manly, staff to Representative Lynn, from Natasha McClanahan, Assistant Legislative Director, and Office of the Governor, which describes the fiscal impact of Amendment 2. Representative Keller noted the zero fiscal note attached to the amendment and asked the committee to adopt the zero fiscal note. He asked Mr. Pound to respond to the items in the e-mail for the committee members. 8:46:53 AM The committee took a brief at-ease at 8:47 a.m. 8:47:05 AM MR. POUND stated that the e-mail described concerns from the departments and agencies concerning the delay of regulations. Mr. Pound expressed his observation that since legislation often takes two years to pass, there is already a delay. He added that when a department introduces a regulation, within 90 days it becomes the "law of the land" and no review is required. He cited one agency's claim on page 2 of the e-mail that $164,000 would be needed to hire a regulation specialist to analyze legislation. Mr. Pound contended that it already was the responsibility of the departments and agencies to analyze bills so that the regulations they created met legislative intent, and that the purpose of the proposed amendment was to make sure they fulfilled that responsibility. He voiced his agreement with the sponsor that Amendment 2, as amended, should have a zero fiscal note. 8:49:10 AM REPRESENTATIVE KELLER moved to adopt the zero fiscal note, the fiscal note from the Department of Law (DOL), and the negative fiscal note. Without objection, it was so ordered. 8:49:42 AM REPRESENTATIVE VAZQUEZ expressed that she hasn't had opportunity to review the lengthy document from the Office of the Governor to legislative staff. She referred to the adopted Amendment 1 to Amendment 2, page 4, line 30, and indicated that she couldn't locate the cited statute, AS 44.62.325. REPRESENTATIVE KELLER mentioned that HB 229 would be referred to the House Finance Committee if it moves out of the House State Affairs Standing Committee. REPRESENTATIVE VAZQUEZ claimed that although she likes the intent of HB 229, the House State Affairs Standing Committee shouldn't relegate their duties to another committee. MR. POUND responded to Representative Vazquez's question by saying that AS 44.62.325 is new language and is located on page 7 of Amendment 2 [Section 19, beginning on line 18]. 8:52:51 AM CHAIR LYNN stated that since there is a concern on the committee regarding HB 229, he will hold the bill. AMENDMENTS  The following amendments to HB 229 were either discussed or adopted during the hearing. [Shorter amendments are provided in the main text only.] Amendment 1 to Amendment 2 [29-LS1104\A.5, Gardner, 3/16/16] (adopted): Page 1, line 1, following "legislature;": Insert "providing for legislative review,  amendment, approval, disapproval, annulment, and delay  of proposed agency regulations;" Page 1, lines 4 - 6: Delete all material. Page 1, line 7: Delete "Sec. 2" Insert "Section 1" Renumber the following bill sections accordingly.   Page 2, lines 1 - 8: Delete all material and insert:  "* Sec. 2. AS 24.05.182(a) is amended to read: (a) A standing committee of the legislature furnished notice of a proposed action under AS 44.62.190 or 44.62.320(d) shall, consistent with  the committee's jurisdiction as provided in the  uniform rules of the legislature, review the proposed regulation, amendment of a regulation, or repeal of a regulation before the date the regulation is scheduled by the department or agency to be adopted, amended, or repealed.  * Sec. 3. AS 24.05.182(d) is amended to read: (d) A standing committee that receives a copy of  a proposed regulation, amendment, or order of repeal  under AS 44.62.320(d) shall, within 35 days after  receipt of the proposed regulation, amendment, or  order of repeal, approve or disapprove the proposed  regulation, amendment, or order of repeal. If the  standing committee does not take action within 35 days  after receipt of the proposed regulation, amendment,  or order of repeal, the proposed regulation,  amendment, or order of repeal shall be considered  approved. If a standing committee determines that a regulation, amendment to a regulation, or repeal of a regulation does not properly implement legislative intent and disapproves or returns the proposed  regulation, amendment, or order of repeal to the  department or agency, the standing committee's findings shall, within 35 days after receipt of the  proposed regulation, amendment, or order of repeal, be transmitted to the (1) department or agency;  (2) regulations attorney at the Department  of Law; and  (3) senate secretary and the chief clerk of  the house of representatives [ADMINISTRATIVE REGULATION REVIEW COMMITTEE].  * Sec. 4. AS 24.05.182 is amended by adding new subsections to read: (e) Except as provided in (h) of this section, a proposed regulation, amendment, or order of repeal that is disapproved under this section or that is returned to the department or agency with a proposed amendment shall be suspended until the adjournment of the next regular legislative session following the date of the committee's disapproval. The notice of disapproval under this section expires upon adjournment of the regular legislative session during which the disapproval or amendment was made or, if the legislature is not in regular session, the next regular legislative session following the date of disapproval, unless the legislature enacts a law that annuls the proposed regulation or order of repeal. (f) If the standing committee that is reviewing a proposed regulation, amendment, or order of repeal under this section disapproves the regulation, amendment, or order of repeal or proposes an amendment to the regulation, amendment, or order of repeal, the department or agency that proposed the regulation, amendment, or order of repeal may request leave of the standing committee to withdraw or amend the proposed regulation, amendment, or order of repeal. (g) In determining whether to approve, disapprove, or amend a proposed regulation, amendment, or order of repeal under this section, the standing committee shall consider (1) whether the absence of a regulation would significantly harm or endanger public health, safety, or welfare; (2) whether a less restrictive regulation would address the regulatory concerns while adequately protecting the public; (3) whether the regulation would directly or indirectly increase the cost of any goods or services; (4) whether the increased cost of implementing and enforcing the regulation would be more detrimental than the purpose of the regulation; (5) whether the regulation was designed solely for the purpose of the protection of the public and would have the primary effect of protecting the public; and (6) any other factors the committee considers to be appropriate. (h) A proposed regulation, amendment, or order of repeal by the Regulatory Commission of Alaska, the Board of Fisheries, the Board of Game, the Alaska Oil and Gas Conservation Commission, the office of victims' rights, or the office of the ombudsman, or an emergency regulation adopted under AS 44.62.250, are not subject to suspension under (e) of this section." Renumber the following bill sections accordingly. Page 3, lines 4 - 7: Delete all material. Renumber the following bill sections accordingly. Page 3, line 24, through page 4, line 19: Delete all material. Renumber the following bill sections accordingly. Page 5, following line 5: Insert a new bill section to read:  "* Sec. 10. AS 44.62.180 is amended to read: Sec. 44.62.180. Effective date. A regulation or an order of repeal filed by the lieutenant governor becomes effective on the 30th day after the date of filing unless (1) otherwise specifically provided by the statute under which the regulation or order of repeal is adopted, in which event it becomes effective on the day prescribed by the statute; (2) it is a regulation prescribing the organization or procedure of an agency, in which event it becomes effective upon filing by the lieutenant governor or upon a later date specified by the state agency in a written instrument submitted with, or as part of, the regulation or order of repeal; (3) it is an emergency regulation or order of repeal adopted under AS 44.62.250, in which case the finding and the statement of the facts constituting the emergency shall be submitted to the lieutenant governor, together with the emergency regulation or order of repeal, which, in that event only, becomes effective upon filing by the lieutenant governor or upon a later date specified by the state agency in a written instrument submitted with, or as part of, the regulation or order of repeal; (4) a later date is prescribed by the state agency in a written instrument submitted with, or as part of, the regulation or order of repeal;  (5) a proposed regulation, amendment, or  order of repeal has been suspended under AS 24.05.182,  in which case, if the proposed regulation, amendment,  or order of repeal takes effect, it takes effect on  the later of  (A) adoption by the agency of an amendment  proposed by a standing committee of the legislature;  or  (B) one day following adjournment of both  houses of the legislature as provided under  AS 44.62.325." Renumber the following bill sections accordingly. Page 5, line 31, following "legislators": Insert "and to the presiding officer of each  house" Page 6, line 4, through page 9, line 9: Delete all material and insert:  "* Sec. 12. AS 44.62.190(b) is amended to read: (b) If the form or manner of notice is prescribed by statute, in addition to the requirements of filing and furnishing notice under AS 44.62.010 - 44.62.300, or in addition to the requirements of filing and mailing notice under other sections of this chapter, the notice shall be published, posted, mailed, filed, or otherwise publicized as prescribed by the statute. In the notice furnished to the legislature under  AS 44.62.190(a)(6), new language added to an existing  regulation shall be underlined, and language deleted  from an existing regulation shall be bracketed and  capitalized.  * Sec. 13. AS 44.62.195 is amended to read: Sec. 44.62.195. Fiscal notes on regulations. If the adoption, amendment, or repeal of a regulation has  an economic effect on a department, agency, or person,  the proposed regulation or order of repeal must  include a fiscal note prepared by the department or  agency in accordance with this section [WOULD REQUIRE INCREASED APPROPRIATIONS BY THE STATE, THE DEPARTMENT OR AGENCY AFFECTED SHALL PREPARE AN ESTIMATE OF THE APPROPRIATION INCREASE FOR THE FISCAL YEAR FOLLOWING ADOPTION, AMENDMENT, OR REPEAL OF THE REGULATION AND FOR AT LEAST TWO SUCCEEDING FISCAL YEARS].  * Sec. 14. AS 44.62.195 is amended by adding a new subsection to read: (b) A fiscal note required under this section must include, where applicable, (1) a determination of the present need for the regulation and the expected need for the regulation; (2) a determination of the costs and benefits of the regulation and an explanation by the department or agency of whether the proposed regulation is the most cost-effective, efficient, and feasible means of allocating public and private resources to achieve the stated purpose; (3) the effect of the regulation on market competition; (4) the effect of the regulation on the cost of living, employment, and doing business in the geographical regions where the regulation would have the greatest effect; (5) the source of revenue to implement and enforce the regulation; (6) a summary of the short-term and long- term economic effects of the regulation, including an analysis of the persons or groups that would bear the costs of the regulation and the persons or groups that would benefit directly or indirectly from the regulation; (7) the difficulties the department or agency encountered, if any, in estimating the persons or groups that would benefit from the regulation or bear the costs of the regulation; (8) the effect that adopting or failing to adopt the regulation would have on the environment and public health.  * Sec. 15. AS 44.62.245(c) is amended to read: (c) The state agency shall also send the notice described in (b)(2) of this section to (1) a person who has placed the person's name on a distribution list kept by the agency that lists persons who want to receive the notice; the agency may allow a person to request that distribution of the notice be by electronic means and shall honor that request if appropriate means are available; (2) the regulations attorney in the Department of Law; and (3) the presiding officer of each house of  the legislature [THE MEMBERS OF THE ADMINISTRATIVE REGULATION REVIEW COMMITTEE].  * Sec. 16. AS 44.62.320(b) is amended to read: (b) At the same time a regulation is filed by the lieutenant governor, the lieutenant governor shall submit the regulation to the presiding officer of each  house of the legislature [CHAIRMAN AND ALL MEMBERS OF THE ADMINISTRATIVE REGULATION REVIEW COMMITTEE FOR REVIEW UNDER AS 24.20.400 - 24.20.460] together with the fiscal information required to be prepared under AS 44.62.195.  * Sec. 17. AS 44.62.320(c) is amended to read: (c) At the same time as a regulation is submitted to the governor under AS 44.62.040(c), the state agency shall submit the regulation to the presiding  officer of each house of the legislature [CHAIR AND ALL MEMBERS OF THE ADMINISTRATIVE REGULATION REVIEW COMMITTEE FOR REVIEW UNDER AS 24.20.400 - 24.20.460] together with the fiscal information required to be prepared under AS 44.62.195.  * Sec. 18. AS 44.62.320(d) is amended to read: (d) Within 10 days after receiving a regulation under (b) or (c) of this section or under  AS 44.62.190(a)(6), the presiding officer of each  house of the legislature shall provide copies of the  regulation to the standing committee with jurisdiction  over the subject matter of the regulation as provided  in the uniform rules of the legislature for review  under AS 24.05.182 [, THE CHAIR OF THE ADMINISTRATIVE REGULATION REVIEW COMMITTEE MAY SUBMIT TO THE GOVERNOR, BY LEGISLATIVE MEMORANDUM OR LETTER, COMMENTS ON THE REGULATION].  * Sec. 19. AS 44.62 is amended by adding a new section to article 7 to read: Sec. 44.62.325. Legislative annulment of  regulations. (a) The legislature may, in the regular legislative session during which a disapproval or amendment is made or, if the legislature is not in regular session, the next regular session following the disapproval or amendment of a proposed regulation, amendment, or order of repeal by a standing committee under AS 24.05.182, annul the proposed regulation, amendment of the proposed regulation, or order of repeal by law. (b) If the legislature, following adjournment of the regular legislative session during which a disapproval or amendment is made or, if the legislature is not in regular session, the next regular session following disapproval or amendment of a proposed regulation, amendment, or order of repeal by a standing committee under AS 24.05.182, has not enacted a law that annuls the proposed regulation, amendment of the proposed regulation, or order of repeal, the proposed regulation, amendment of the proposed regulation, or order of repeal takes effect one day after adjournment of both houses of the legislature." Renumber the following bill sections accordingly. Page 9, line 13: Delete "(AS 44.62.040 - 44.62.319) [AS 44.62.040 - 44.62.320]" Insert "(AS 44.62.040 - 44.62.320)" Page 9, line 20: Delete "AS 24.05.182(b), 24.05.182(c), 24.05.182(d);" Page 9, line 22: Delete "AS 40.25.120(a)(11); and AS 44.62.320" Insert "and AS 40.25.120(a)(11)" [HB 229 was held over.]