S-0914.3 _______________________________________________
SENATE BILL 5739
_______________________________________________
State of Washington 53rd Legislature 1993 Regular Session
By Senators Moore, Anderson, Oke and Winsley
Read first time 02/11/93. Referred to Committee on Labor & Commerce.
AN ACT Relating to small businesses; amending RCW 19.85.020, 19.85.010, 19.85.070, and 34.05.310; reenacting and amending RCW 19.85.030 and 19.85.040; adding new sections to chapter 34.05 RCW; adding a new section to chapter 43.31 RCW; and repealing RCW 19.85.060.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec. 1. RCW 19.85.020 and 1989 c 374 s 1 are each amended to read as follows:
Unless the context clearly indicates otherwise, the definitions in this section apply through this chapter.
(1) "Small business" has the meaning given in RCW 43.31.025(4).
(2) "Small business economic impact statement" means a statement meeting the requirements of RCW 19.85.040 prepared by a state agency pursuant to RCW 19.85.030.
(3) "Industry" means all of the
businesses in this state in any one ((three-digit)) four-digit
standard industrial classification as published by the United States department
of commerce.
Sec. 2. 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)) are
subject to rules adopted by agencies, departments, and instrumentalities of
the state government which ((have placed)) place a
proportionately higher burden on ((the small business community in
Washington state)) them. 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. The legislature therefore enacts this Regulatory Fairness Act to
minimize such proportionately higher impacts of rules on small businesses in
the future.
Sec. 3. RCW 19.85.030 and 1989 c 374 s 2 and 1989 c 175 s 72 are each reenacted and amended to read as follows:
((In the adoption of any rule pursuant to
RCW 34.05.320 that will have an economic impact on more than twenty percent of
all industries, or more than ten percent of any one industry, the adopting
agency:
(1) Shall reduce the economic impact of the
rule on small business by doing one or more of the following when it is legal
and feasible in meeting the stated objective of the statutes which are the
basis of the proposed rule:
(a) Establish differing compliance or reporting
requirements or timetables for small businesses;
(b) Clarify, consolidate, or simplify the
compliance and reporting requirements under the rule for small businesses;
(c) Establish performance rather than design
standards;
(d) Exempt small businesses from any or all
requirements of the rule;
(2) Shall prepare a small business economic
impact statement in accordance with RCW 19.85.040 and file such statement with
the code reviser along with the notice required under RCW 34.05.320;
(3))) (1)
An agency shall prepare a small business economic impact statement if a
proposed rule will impose costs that are more than minor and negligible on
small business, or upon the request of a legislator, provided that a legislator
requests the statement at least one week prior to the initial rule-making
hearing.
A small business economic impact statement shall be prepared in accordance with RCW 19.85.040 and shall be filed with the code reviser along with the notice required under RCW 34.05.320. However, a small business economic impact statement that is prepared at the request of a legislator shall be filed with the code reviser upon completion. An agency shall notify each person who has requested a copy of the small business economic impact statement upon completion of the statement.
The agency may request assistance from the business assistance center in the preparation of the small business economic impact statement.
(2) A proposed rule imposes more than minor or negligible costs on small business if:
(a) In order to comply with the rule, a small business must:
(i) Submit a new report or form to an agency;
(ii) Keep a new record, change an industrial process, or prepare a plan;
(iii) Acquire additional equipment, supplies, or personnel; or
(iv) Obtain legal, consulting, or accounting services; or
(b) The proposed rule will establish standards that are more stringent or substantially different than existing federal requirements.
(3) Based upon the degree of impact on small business identified in the statement prepared under RCW 19.85.040, the agency shall, unless reasonable justification exists to do otherwise, reduce the cost on small businesses. Reduction of the regulatory costs to small business may include, but is not limited to:
(a) Reducing, modifying, or eliminating substantive regulatory requirements;
(b) Establishing performance rather than design standards;
(c) Simplifying, reducing, or eliminating recordkeeping and reporting requirements;
(d) Reducing the frequency of inspections;
(e) Delaying compliance time tables; or
(f) Reducing or modifying fine schedules for noncompliance, provided that fines remain greater than the gain for noncompliance.
Sec. 4. RCW 19.85.040 and 1989 c 374 s 3 and 1989 c 175 s 73 are each reenacted and amended to read as follows:
(1) A small business economic impact
statement ((must include a brief description of the reporting,
recordkeeping, and other compliance requirements of the rule, and the kinds of
professional services that a small business is likely to need in order to
comply with such requirements. A small business economic impact statement
shall analyze, based on existing data, the costs of compliance for businesses
required to comply with the provisions of a rule adopted pursuant to RCW
34.05.320, including costs of equipment, supplies, labor, and increased
administrative costs, and compare to the greatest extent possible the cost of
compliance for small business with the cost of compliance for the ten percent
of firms which are the largest businesses required to comply with the proposed
new or amendatory rules. The small business economic impact statement shall
use one or more of the following as a basis for comparing costs:
(1) Cost per employee;
(2) Cost per hour of labor;
(3) Cost per one hundred dollars of sales;
(4) Any combination of (1), (2), or (3))) shall clearly state the following with regard to a
proposed rule:
(a) The nature of reports or recordkeeping and the estimated cost of their preparation by small businesses which would be required to comply with the proposed rule;
(b) An analysis of the direct and indirect costs of compliance for all small businesses affected by the proposed rule, including costs of equipment, supplies, labor, training, and increased administrative costs;
(c) The nature and estimated cost of legal, consulting, and accounting services that small business would incur in complying with the proposed rule;
(d) The general ability of small businesses to absorb the costs estimated under (a) through (c) of this subsection without adversely affecting competition in the marketplace;
(e) A statement regarding the manner in which the agency reduced the impact of the rule on small businesses as required under RCW 19.85.030, or reasonable justification for not doing so;
(f) A statement regarding whether and how the agency has involved small businesses in the development of the rule; and
(g) A list of industries that would be required to comply with the proposed rule.
(2) In order to obtain cost information for purposes of subsection (1) of this section, an agency may survey a representative sample of affected small businesses or trade associations. An agency may also use other reasonable means to collect information to accurately assess the costs and impact of a proposed rule on small businesses.
Sec. 5. RCW 19.85.070 and 1992 c 197 s 1 are each amended to read as follows:
When any rule is proposed for which a small
business economic impact statement is ((required)) prepared, the
adopting agency shall provide notice to small businesses of the proposed rule
through any of the following:
(1) Direct notification of known interested small businesses or trade organizations affected by the proposed rule; or
(2) Providing information of the proposed rule making to publications likely to be obtained by small businesses of the types affected by the proposed rule.
Sec. 6. RCW 34.05.310 and 1989 c 175 s 5 are each amended to read as follows:
(1) In addition to seeking information by other methods, an agency, before publication of a notice of a proposed rule adoption under RCW 34.05.320, is encouraged to solicit comments from the public on a subject of possible rule making under active consideration within the agency, by causing notice to be published in the state register of the subject matter and indicating where, when, and how persons may comment.
(2) Each agency may appoint committees to comment, before publication of a notice of proposed rule adoption under RCW 34.05.320, on the subject of a possible rule-making action under active consideration within the agency.
(((3) Each agency shall designate a rules
coordinator, who shall have knowledge of the subjects of rules being proposed
or prepared within the agency for proposal, maintain the records of any such
action, and respond to public inquiries about possible or proposed rules and
the identity of agency personnel working, reviewing, or commenting on them.
The office and mailing address of the rules coordinator shall be published in
the state register at the time of designation and in the first issue of each
calendar year thereafter for the duration of the designation. The rules
coordinator may be an employee of another agency.))
NEW SECTION. Sec. 7. A new section is added to chapter 34.05 RCW to read as follows:
(1) Each agency shall designate a rules coordinator who shall:
(a) Have experience with either the implementation of agency rules or administrative law;
(b) Have knowledge of the subjects of rules, policies, or interpretive statements being proposed or developed within the agency;
(c) Maintain the records of such action pursuant to this title and the index of agency records listed under RCW 42.17.260(5);
(d) Maintain contact with other agency rules coordinators in order to coordinate rule-making hearings on similar subjects or for similar industries;
(e) Develop and file the annual rule-making plan as required in section 8 of this act; and
(f) Respond to public inquiries about possible or proposed rules, policies, or interpretive statements and the identity of agency personnel working, reviewing, or commenting on them.
(2) The office, mailing address, and telephone number of the rules coordinator shall be published in the state register at the time of designation and in the first issue of each calendar year thereafter for the duration of the designation. The rules coordinator may be an employee of another agency.
(3) Within six months of designation, the agency rules coordinator shall complete the administrative procedures training courses recommended by the business assistance center.
NEW SECTION. Sec. 8. A new section is added to chapter 34.05 RCW to read as follows:
(1) To encourage greater public participation in administrative rule making, each agency shall adopt an annual rule-making plan. The rule-making plan shall be prepared by the agency rules coordinator and shall list rules currently under development and rules that the agency may propose for adoption within the year. The rule-making plan may also include agency interpretive or policy statements to be issued or adopted within the year.
(2) Activities in the rule-making plan shall be listed in order of priority. For each activity in the rule-making plan, the agency shall list:
(a) A descriptive title for the activity;
(b) A Washington Administrative Code citation for reference;
(c) An intended adoption date; and
(d) Agency personnel, with their telephone number, who are responsible for drafting or implementing the rule, policy, or interpretive statement.
(3) Agency rule-making plans shall be published annually in the state register after January 1st, but prior to January 31st. Supplemental agency rule-making plans shall be published in the state register no later than sixty days after a regular session of the legislature. Upon filing the annual rule-making plan with the code reviser, the agency rules coordinator shall forward a copy of the plan to the appropriate standing committees of the legislature. Agencies are encouraged to publish rule-making plans in state newspapers or business publications to facilitate public review.
NEW SECTION. Sec. 9. A new section is added to chapter 43.31 RCW to read as follows:
To assist state agencies in reducing regulatory costs to small business and to promote greater public participation in the rule-making process, the business assistance center shall:
(1) Develop agency guidelines for the preparation of a small business economic impact statement and compliance with chapter 19.85 RCW;
(2) Review and provide comments to agencies on draft or final small business economic impact statements;
(3) Advise the joint administrative rules review committee on whether an agency reasonably assessed the costs and impact of a proposed rule and reduced the costs for small business as required by chapter 19.85 RCW; and
(4) Organize and chair a state rules coordinating committee, comprised of agency rules coordinators and interested members of the public, to develop an education and training program for agency personnel responsible for rule development and implementation. The business assistance center shall submit recommendations to the department of personnel for an administrative procedures training program that is based on the sharing of interagency resources.
NEW SECTION. Sec. 10. RCW 19.85.060 and 1989 c 374 s 5 are each repealed.
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