H-3544

AN ACT Relating to regulatory fairness; amending RCW 19.85.010, 19.85.050, 42.17.2401, 43.03.028, 19.27.040, 19.27.074, 43.19.1904, 43.19.1911, 43.31.085, and 43.31.092; adding a new section to chapter 19.85 RCW; adding a new section to chapter 34.05 RCW; and adding a new chapter to Title 43 RCW.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

Sec. 1. RCW 19.85.010 and 1982 c 6 s 1 are each amended to read as follows:

The legislature finds that small businesses in the state of Washington have in the past been subjected to rules adopted by agencies, departments, and instrumentalities of the state government which have placed a proportionately higher burden on the small business community in Washington state. The legislature also finds that such proportionately higher burdens placed on small businesses have reduced competition, reduced employment, reduced new employment opportunities, reduced innovation, and threatened the very existence of some small businesses. Therefore, it is the intent of the legislature that rules affecting the business community shall not place proportionately higher burdens on small businesses, and that state agency personnel shall assist regulated parties in understanding the basis for specific agency actions. The legislature therefore enacts this Regulatory Fairness Act to minimize such proportionately higher impacts of rules on small businesses in the future.

Sec. 2. RCW 19.85.050 and 1989 c 175 s 74 are each amended to read as follows:

(1) ((~~Within one year after June 10, 1982,~~)) Each agency shall publish and deliver to the office of financial management and to all persons who make requests of the agency for a copy of a plan to periodically review all rules then in effect and which have been issued by the agency which have an economic impact on more than twenty percent of all industries or ten percent of the businesses in any one industry. Such plan may be amended by the agency at any time by publishing a revision to the review plan and delivering such revised plan to the office of financial management and to all persons who make requests of the agency for the plan. The purpose of the review is to determine whether such rules should be continued without change or should be amended or rescinded, consistent with the stated objectives of applicable statutes, to minimize the economic impact on small businesses as described by this chapter. The plan shall provide for the review of all such agency rules in effect on June 10, 1982, within ten years of that date.

(2) In reviewing rules to minimize any significant economic impact of the rule on small businesses as described by this chapter, and in a manner consistent with the stated objectives of applicable statutes, the agency shall consider the following factors:

(a) The continued need for the rule;

(b) The nature of complaints or comments received concerning the rule from the public;

(d) The extent to which the rule overlaps, duplicates, or conflicts with other state or federal rules, and, to the extent feasible, with local governmental rules; ((~~and~~))

(e) The degree to which technology, economic conditions, or other factors have changed in the subject area affected by the rule; and

(f) Any recommendations made by working groups established by the regulatory ombudsman under section 7 of this act.

(3) Each year each agency shall publish a list of rules which are to be reviewed pursuant to this section during the next twelve months and deliver a copy of the list to the office of financial management and all persons who make requests of the agency for the list. The list shall include a brief description of the legal basis for each rule as described by RCW 34.05.360, and shall invite public comment upon the rule.

NEW SECTION. Sec. 3. A new section is added to chapter 19.85 RCW to read as follows:

(1) Upon the request of an applicant for a permit, the issuing agency or agencies shall furnish, for a reasonable fee, a written description of the specific requirements the applicant must meet in order to obtain the permit. The pertinent requirements in the rules shall be clearly evident to the applicant in the materials furnished.

Each agency shall review the materials being furnished at least once each quarter to assure that they are complete and current.

(2) Upon request by a person, firm, or corporation subject to any agency rule not requiring the issuance of a permit, the agency shall furnish a written description of the specific requirements the applicant must meet in order to comply with the rules. The pertinent requirements of the rules shall be clearly evident to the applicant in the materials furnished. In meeting this requirement, an agency may highlight sections of existing rules or publications that are applicable to the person, firm, or corporation making the request, if the materials provide clear indications of how the person, firm, or corporation can comply with the requirements of the rules.

NEW SECTION. Sec. 4. The legislature finds that a need exists for an additional process to challenge the adoption or application of unduly burdensome rules and administrative actions by state agencies. The process should encourage state agencies to establish practical goals while accommodating the needs of regulated businesses. For this purpose, the legislature creates the office of regulatory ombudsman within the office of financial management. The current position of ombudsman within the department of trade and economic development shall be transferred to the office of regulatory ombudsman.

NEW SECTION. Sec. 5. The governor shall appoint a qualified person to the office of regulatory ombudsman with the advice and consent of the senate, for a term of five years from the date of appointment. The ombudsman shall have complete charge of and supervisory power over the office. The ombudsman may employ such assistants and personnel as may be appropriated in order to serve the purposes of this chapter. The ombudsman shall be paid a salary to be fixed by the governor in accordance with RCW 43.03.040.

The ombudsman may be removed by the governor for misfeasance, malfeasance, or willful neglect of duty after notice and a public hearing, unless such notice and hearing shall be expressly waived in writing by the ombudsman. In the event of a vacancy in the office of regulatory ombudsman due to death, resignation, or removal, the governor shall appoint a successor for the remainder of the unexpired term.

NEW SECTION. Sec. 6. (1) The regulatory ombudsman shall receive, review, and investigate complaints, which must be filed in writing, from persons who assert that they have been or will be unduly burdened by state agency rules or administrative actions. Within five working days of receiving a complaint, the ombudsman shall mail written acknowledgment to the complainant at the address provided and within thirty working days, the ombudsman shall notify the complainant of the findings of the investigation unless written justification for the delay is furnished to the complainant.

(2) If the ombudsman finds that the agency has adopted a rule or taken an administrative action that is unduly burdensome upon the complainant, the ombudsman shall request the affected agency to provide relief to the complainant or revise the rule to avoid the unduly burdensome consequences.

(3) If the ombudsman's request is not satisfied, the ombudsman may seek to reconcile the differences between the complainant and the affected agency. In all cases, a final report of the outcome of the matter shall be furnished to the complainant and to the agency within one hundred twenty days after the complaint was filed.

(4) For the purposes of sections 4 through 7 of this act, factors that may cause an agency rule or administrative action to be unduly burdensome may include, but are not limited to:

(a) The denial of a permit without reference to specific criteria;

(b) The actual need of the agency for and the cost to the complainant of preparing reports and audits that are excessive, are not required by state law, or can be achieved in a substantially simpler way as determined by the ombudsman;

(d) The failure to establish time limits for agency reviews, responses, and decisions, and unreasonable delays in such actions;

(e) The use of agency policies or guidelines in instances when formal rules should be adopted pursuant to chapter 34.05 RCW;

(f) The rule failed to incorporate a reasonably method to minimize the disproportionate cost of agency rules required by chapter 19.85 RCW. In making this finding, the ombudsman shall explain a method that better accomplishes the intent of chapter 19.85 RCW; or

(g) The requirements to comply with the rule are excessive and unnecessary in meeting the policies established by state law.

(5) Whenever the ombudsman finds that an agency rule or administrative action is unduly burdensome and the agency did not take appropriate action to provide relief, the ombudsman shall prepare a written report of this finding and transmit it to the joint administrative rules review committee, the governor, and the appropriate standing committees of the legislature. The report shall explain the issue of concern, the rules and administrative actions involved, the basis on which the ombudsman finds the rule or administrative action unduly burdensome, and what relief the ombudsman believes the agency should take. The ombudsman shall provide copies to any other party upon request.

(6) By January 31 of each year, the ombudsman shall prepare an indexed annual report including every finding in which an agency rule or administrative action has been determined to be unduly burdensome, and furnish a copy to the chairperson and ranking minority member of each standing committee of the legislature and any other person requesting a copy.

NEW SECTION. Sec. 7. The regulatory ombudsman may establish working groups to review and make recommendations to appropriate agencies on federal, state, and local regulations when necessary to minimize conflict, reduce redundancy, and achieve a balance between local interests and broad public benefit.

Sec. 8. RCW 42.17.2401 and 1991 c 200 s 404 are each amended to read as follows:

For the purposes of RCW 42.17.240, the term "executive state officer" includes:

(1) The chief administrative law judge, the director of agriculture, the administrator of the office of marine safety, the administrator of the Washington basic health plan, the director of the department of services for the blind, the director of the state system of community and technical colleges, the director of community development, the secretary of corrections, the director of ecology, the commissioner of employment security, the chairman of the energy facility site evaluation council, the director of the energy office, the secretary of the state finance committee, the director of financial management, the director of fisheries, the executive secretary of the forest practices appeals board, the director of the gambling commission, the director of general administration, the secretary of health, the administrator of the Washington state health care authority, the executive secretary of the health care facilities authority, the executive secretary of the higher education facilities authority, the director of the higher education personnel board, the executive secretary of the horse racing commission, the executive secretary of the human rights commission, the executive secretary of the indeterminate sentence review board, the director of the department of information services, the director of the interagency committee for outdoor recreation, the executive director of the state investment board, the director of labor and industries, the director of licensing, the director of the lottery commission, the director of the office of minority and women's business enterprises, the director of parks and recreation, the director of personnel, the executive director of the public disclosure commission, the regulatory ombudsman, the director of retirement systems, the director of revenue, the secretary of social and health services, the chief of the Washington state patrol, the executive secretary of the board of tax appeals, the director of trade and economic development, the secretary of transportation, the secretary of the utilities and transportation commission, the director of veterans affairs, the director of wildlife, the president of each of the regional and state universities and the president of The Evergreen State College, each district and each campus president of each state community college;

(2) Each professional staff member of the office of the governor;

(3) Each professional staff member of the legislature; and

(4) Central Washington University board of trustees, board of trustees of each community college, each member of the state board for community ((~~college education~~)) and technical colleges, state convention and trade center board of directors, board of pilotage ((~~[commissioners]~~)) commissioners, committee for deferred compensation, Eastern Washington University board of trustees, Washington economic development finance authority, The Evergreen State College board of trustees, forest practices appeals board, forest practices board, gambling commission, Washington health care facilities authority, higher education coordinating board, higher education facilities authority, higher education personnel board, horse racing commission, state housing finance commission, human rights commission, indeterminate sentence review board, board of industrial insurance appeals, information services board, interagency committee for outdoor recreation, state investment board, liquor control board, lottery commission, marine oversight board, oil and gas conservation committee, Pacific Northwest electric power and conservation planning council, parks and recreation commission, personnel appeals board, personnel board, pollution control hearings board, public disclosure commission, public pension commission, shorelines hearing board, state employees' benefits board, board of tax appeals, transportation commission, University of Washington board of regents, utilities and transportation commission, Washington state maritime commission, Washington public power supply system executive board, Washington State University board of regents, Western Washington University board of trustees, and wildlife commission.

Sec. 9. RCW 43.03.028 and 1991 c 3 s 294 are each amended to read as follows:

(1) There is hereby created a state committee on agency officials' salaries to consist of seven members, or their designees, as follows: The president of the University of Puget Sound; the chairperson of the council of presidents of the state's four-year institutions of higher education; the chairperson of the State Personnel Board; the president of the Association of Washington Business; the president of the Pacific Northwest Personnel Managers' Association; the president of the Washington State Bar Association; and the president of the Washington State Labor Council. If any of the titles or positions mentioned in this subsection are changed or abolished, any person occupying an equivalent or like position shall be qualified for appointment by the governor to membership upon the committee.

(2) The committee shall study the duties and salaries of the directors of the several departments and the members of the several boards and commissions of state government, who are subject to appointment by the governor or whose salaries are fixed by the governor, and of the chief executive officers of the following agencies of state government:

The arts commission; the human rights commission; the board of accountancy; the board of pharmacy; the capitol historical association and museum; the eastern Washington historical society; the Washington state historical society; the interagency committee for outdoor recreation; the criminal justice training commission; the department of personnel; the regulatory ombudsman; the state finance committee; the state library; the traffic safety commission; the horse racing commission; the advisory council on vocational education; the public disclosure commission; the state conservation commission; the commission on Hispanic affairs; the commission on Asian-American affairs; the state board for volunteer fire fighters; the transportation improvement board; the public ((~~employees~~)) employment relations commission; the forest practices appeals board; and the energy facilities site evaluation council.

The committee shall report to the governor or the chairperson of the appropriate salary fixing authority at least once in each fiscal biennium on such date as the governor may designate, but not later than seventy-five days prior to the convening of each regular session of the legislature during an odd-numbered year, its recommendations for the salaries to be fixed for each position.

(3) Committee members shall be reimbursed by the department of personnel for travel expenses under RCW 43.03.050 and 43.03.060.

Sec. 10. RCW 19.27.040 and 1990 c 2 s 11 are each amended to read as follows:

The governing body of each county or city is authorized to amend the state building code as it applies within the jurisdiction of the county or city. Any amendment shall be accompanied by a statement of the reasons for the local variation from state standards, and shall be made available to the public. The minimum performance standards of the codes and the objectives enumerated in RCW 19.27.020 shall not be diminished by any county or city amendments.

Nothing in this chapter shall authorize any modifications of the requirements of chapter 70.92 RCW.

Sec. 11. RCW 19.27.074 and 1989 c 266 s 3 are each amended to read as follows:

(1) The state building code council shall:

(a) Adopt and maintain the codes to which reference is made in RCW 19.27.031 in a status which is consistent with the state's interest as set forth in RCW 19.27.020. In maintaining these codes, the council shall regularly review updated versions of the codes referred to in RCW 19.27.031 and other pertinent information and shall amend the codes as deemed appropriate by the council;

(b) Approve or deny all county or city amendments to any code referred to in RCW 19.27.031 to the degree the amendments apply to single family or multifamily residential buildings;

(d) Propose a budget for the operation of the state building code council to be submitted to the office of financial management pursuant to RCW 43.88.090.

(2) The state building code council may:

(a) Appoint technical advisory committees which may include members of the council;

(b) Employ permanent and temporary staff and contract for services; and

(3) The state building code council shall appoint a technical advisory committee, which may include members of the council, to assess emerging design, materials, and construction technologies for possible inclusion in the appropriate code.

All meetings of the state building code council shall be open to the public under the open public meetings act, chapter 42.30 RCW. All actions of the state building code council which adopt or amend any code of state-wide applicability shall be pursuant to the administrative procedure act, chapter 34.05 RCW.

All council decisions relating to the codes enumerated in RCW 19.27.031 shall require approval by at least a majority of the members of the council.

All decisions to adopt or amend codes of state-wide application shall be made prior to December 1 of any year and shall not take effect before the end of the regular legislative session in the next year.

Sec. 12. RCW 43.19.1904 and 1979 c 88 s 2 are each amended to read as follows:

The state supply management advisory board shall advise and give assistance to the director of general administration in planning and carrying out an efficient and economical purchasing and material control program.

The state supply management advisory board shall review and make recommendations to the director with respect to:

(1) Standards and specifications for all items of material, supplies, and equipment of common usage in state agencies;

(2) Specifications for specific items of material, supplies, and equipment referred to it by the division of purchasing;

(3) Standards for the purchase, replacement, and repair of automotive equipment consistent with the needs and location of state agencies;

(4) A uniform system of inventory control for material and supplies;

(5) Request for proposal criteria that offer adequate detail for realistic bids and encourage competition from multiple suppliers. Request for proposal criteria shall, to the greatest extent possible, set forth terms of all purchases that are commonly used for similar purchases in private commerce. Criteria that is uncommon to similar purchases in private commerce may only be required when the director has determined, in writing, that the uncommon requirement is essential to assuring the economical purchasing of materials;

(6) All other matters referred to it by the director of general administration or by a member of the advisory board.

The state supply management advisory board shall act as an appeals board to hear appeals on matters involving a state agency and the division of purchasing, and shall render its decision relating thereto within thirty days after filing of the appeal. The findings and actions of the board shall be binding upon the respective state agencies including all offices, institutions, and departments.

Public funds shall not be expended by any agency for substitutions for material, supplies, and equipment for which standards have been established by the division of purchasing after consulting with and receiving the recommendations of the board unless prior written approval is obtained from the state purchasing and material control director.

Sec. 13. RCW 43.19.1911 and 1989 c 431 s 60 are each amended to read as follows:

When purchases are made through competitive bidding, the contract shall be let to the lowest responsible bidder, subject to any preferences provided by law to Washington products and vendors and to RCW 43.19.704, taking into consideration the quality of the articles proposed to be supplied, their conformity with specifications, the purposes for which required, and the times of delivery((~~: PROVIDED, That~~)). Whenever there is reason to believe that the lowest acceptable bid is not the best price obtainable, all bids may be rejected and the division of purchasing may call for new bids or enter into direct negotiations to achieve the best possible price. In any case where the lowest priced bid is not accepted, the agency shall advise those bidders offering lower prices of the reasons for rejection. Each bid with the name of the bidder shall be entered of record and each record, with the successful bid indicated, shall, after letting of the contract, be open to public inspection. In determining "lowest responsible bidder", in addition to price, the following elements shall be given consideration:

(1) The ability, capacity, and skill of the bidder to perform the contract or provide the service required;

(2) The character, integrity, reputation, judgment, experience, and efficiency of the bidder;

(3) Whether the bidder can perform the contract within the time specified;

(4) The quality of performance of previous contracts or services;

(5) The previous and existing compliance by the bidder with laws relating to the contract or services;

(6) Such other information as may be secured having a bearing on the decision to award the contract((~~: PROVIDED, That~~)).

In considering bids for purchase, manufacture, or lease, and in determining the "lowest responsible bidder," whenever there is reason to believe that applying the "life cycle costing" technique to bid evaluation would result in lowest total cost to the state, first consideration shall be given by state purchasing activities to the bid with the lowest life cycle cost which complies with specifications. "Life cycle cost" means the total cost of an item to the state over its estimated useful life, including costs of selection, acquisition, operation, maintenance, and where applicable, disposal, as far as these costs can reasonably be determined, minus the salvage value at the end of its estimated useful life. The "estimated useful life" of an item means the estimated time from the date of acquisition to the date of replacement or disposal, determined in any reasonable manner. Nothing in this section shall prohibit any state agency, department, board, commission, committee, or other state-level entity from allowing for preferential purchase of products made from recycled materials or products that may be recycled or reused.

The department shall exercise care to ensure that competitive bidding requirements are being followed with regard to purchases subject to RCW 43.19.1906 through 43.19.1913.

Sec. 14. RCW 43.31.085 and 1989 c 430 s 2 are each amended to read as follows:

The business assistance center shall:

(1) Serve as the state's lead agency and advocate for the development and conservation of businesses.

(2) Coordinate the delivery of state programs to assist businesses.

(3) Provide comprehensive referral services to businesses requiring government assistance.

(4) Serve as the business ombudsman within state government and advise the governor and the legislature of the need for new legislation to improve the effectiveness of state programs to assist businesses.

(5) Aggressively promote business awareness of the state's business programs and distribute information on the services available to businesses.

(6) Develop, in concert with local economic development and business assistance organizations, coordinated processes that complement both state and local activities and services.

(7) Work with the state agencies concerning regional office practices, including uniform business hours, adequate public parking, and convenient posting of notices of office hours and areas for specific transactions.

(8) The business assistance center shall work with other federal, state, and local agencies and organizations to ensure that business assistance services including small business, trade services, and distressed area programs are provided in a coordinated and cost-effective manner.

((~~(8)~~)) (9) In collaboration with the child care coordinating committee in the department of social and health services, prepare and disseminate information on child care options for employers and the existence of the program. As much as possible, and through interagency agreements where necessary, such information should be included in the routine communications to employers from (a) the department of revenue, (b) the department of labor and industries, (c) the department of community development, (d) the employment security department, (e) the department of trade and economic development, (f) the small business development center, and (g) the department of social and health services.

((~~(9)~~)) (10) In collaboration with the child care coordinating committee in the department of social and health services, compile information on and facilitate employer access to individuals, firms, organizations, and agencies that provide technical assistance to employers to enable them to develop and support child care services or facilities.

((~~(10)~~)) (11) Actively seek public and private money to support the child care facility fund described in RCW 43.31.502, staff and assist the child care facility fund committee as described in RCW 43.31.504, and work to promote applications to the committee for loan guarantees, loans, and grants.

NEW SECTION. Sec. 15. A new section is added to chapter 34.05 RCW to read as follows:

Each agency shall prepare a statement for every rule imposing a duty upon a person other than a governmental subdivision or unit thereof that explains the steps required for such person to comply with the rule. Such statement shall be in plain English and written so that a reasonable person can understand it without reliance on an attorney.

Sec. 16. RCW 43.31.092 and 1990 c 297 s 10 are each amended to read as follows:

The following acts or parts of acts, as now existing or hereafter amended, are each repealed, effective June 30, 1994:

(1) Section 2, chapter 348, Laws of 1987 and RCW 43.31.083;

(2) Section 11, chapter 466, Laws of 1985, section 3, chapter 348, Laws of 1987, section 2, chapter 430, Laws of 1989, section 14, chapter ---, Laws of 1992 (section 14 of this act) and RCW 43.31.085;

(3) Section 4, chapter 348, Laws of 1987 and RCW 43.31.087; and

(4) Section 5, chapter 348, Laws of 1987 and RCW 43.31.089.

NEW SECTION. Sec. 17. Sections 4 through 7 of this act shall constitute a new chapter in Title 43 RCW.