[atlas:bill]

AN ACT Relating to local government regulatory fairness; amending RCW 34.05.320 and 43.135.060; and adding a new chapter to Title 34 RCW.

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

NEW SECTION. Sec. 1. The legislature finds that administrative rules adopted by state agencies can have a disproportionate impact on local governments due to the financial burdens of providing services to its citizens. This disproportionate impact reduces service levels, forces employee reductions, and threatens the very existence of some small jurisdictions. The legislature therefore enacts the local government regulatory fairness act with the intent of reducing the disproportionate impact of state administrative rules on local governments.

NEW SECTION. Sec. 2. The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.

(1) "Agency" means any state board, commission, department, institution of higher education, or office, authorized by law to make rules or conduct adjudicative proceedings, except those in the legislative or judicial branch.

(2) "Local government" means any political subdivision or unit of local government of this state including, but not limited to, municipal corporations, quasi-municipal corporations, special purpose districts, and local service districts.

Sec. 3. RCW 34.05.320 and 1995 c 403 s 302 are each amended to read as follows:

(1) At least twenty days before the rule-making hearing at which the agency receives public comment regarding adoption of a rule, the agency shall cause notice of the hearing to be published in the state register. The publication constitutes the proposal of a rule. The notice shall include all of the following:

(a) A title, a description of the rule's purpose, and any other information which may be of assistance in identifying the rule or its purpose;

(b) Citations of the statutory authority for adopting the rule and the specific statute the rule is intended to implement;

(d) The agency personnel, with their office location and telephone number, who are responsible for the drafting, implementation, and enforcement of the rule;

(e) The name of the person or organization, whether private, public, or governmental, proposing the rule;

(f) Agency comments or recommendations, if any, regarding statutory language, implementation, enforcement, and fiscal matters pertaining to the rule;

(g) Whether the rule is necessary as the result of federal law or federal or state court action, and if so, a copy of such law or court decision shall be attached to the purpose statement;

(h) When, where, and how persons may present their views on the proposed rule;

(i) The date on which the agency intends to adopt the rule;

(j) A short explanation of the rule, its purpose, and anticipated effects, including in the case of a proposal that would modify existing rules, a short description of the changes the proposal would make;

(k) A copy of the local government impact statement prepared under section 6 of this act;

(l) A copy of the small business economic impact statement prepared under chapter 19.85 RCW, or an explanation for why the agency did not prepare the statement; and

((~~(l)~~)) (m) A statement indicating whether RCW 34.05.328 applies to the rule adoption.

(2) Upon filing notice of the proposed rule with the code reviser, the adopting agency shall have copies of the notice on file and available for public inspection and shall forward three copies of the notice to the rules review committee.

(3) No later than three days after its publication in the state register, the agency shall cause a copy of the notice of proposed rule adoption to be mailed to each person, city, and county that has made a request to the agency for a mailed copy of such notices. An agency may charge for the actual cost of providing a requesting party mailed copies of these notices.

(4) In addition to the notice required by subsections (1) and (2) of this section, an institution of higher education shall cause the notice to be published in the campus or standard newspaper of the institution at least seven days before the rule-making hearing.

Sec. 4. RCW 43.135.060 and 1998 c 321 s 15 are each amended to read as follows:

(1) After July 1, 1995, the legislature, or a state agency through the rule-making process, shall not impose responsibility for new programs or increased levels of service under existing programs on any political subdivision of the state unless the subdivision is fully reimbursed by the state for the costs of the new programs or increases in service levels. Reimbursement by the state may be made by: (a) A specific appropriation; ((or)) (b) increases in state distributions of revenue to political subdivisions occurring after January 1, 1998; or (c) funding from the state agency.

(2) If by order of any court, or legislative enactment, the costs of a federal or local government program are transferred to or from the state, the otherwise applicable state expenditure limit shall be increased or decreased, as the case may be, by the dollar amount of the costs of the program.

(3) The legislature, in consultation with the office of financial management or its successor agency, shall determine the costs of any new programs or increased levels of service under existing programs imposed on any political subdivision or transferred to or from the state.

(4) Subsection (1) of this section does not apply to the costs incurred for voting devices or machines under RCW 29.04.200.

(5) For the purposes of this section:

(a) "Agency" means any state board, commission, department, institution of higher education, or office, authorized by law to make rules or conduct adjudicative proceedings, except those in the legislative or judicial branch; and

(b) "Local government" means any political subdivision or unit of local government of this state including, but not limited to, municipal corporations, quasi-municipal corporations, special purpose districts, and local service districts.

NEW SECTION. Sec. 5. Proposed rules to be adopted by state agencies that have a fiscal impact greater than fifty thousand dollars, as determined by the local government impact statement, may not be imposed without full reimbursement according to RCW 43.135.060.

NEW SECTION. Sec. 6. (1) In the adoption of a rule under chapter 34.05 RCW, an agency shall prepare a local government impact statement if: (a) The proposed rule will impose more than minor costs on local governments; or (b) requested to do so by a majority vote of the joint administrative rules review committee within forty-five days of receiving the notice of proposed rule making under RCW 34.05.320.

An agency shall prepare the local government impact statement, and file it with the office of the code reviser along with the notice required under RCW 34.05.320. An agency shall file a statement prepared at the request of the joint administrative rules review committee with the office of the code reviser upon its completion before the adoption of the rule. An agency shall provide a copy of the local government impact statement to any person requesting it.

(2) Based upon the extent of disproportionate impact on local governments identified in the statement prepared under this chapter, the agency shall, where legal and feasible in meeting the stated objectives of the statutes upon which the rule is based, reduce the costs imposed by the rule on local governments. Methods to reduce the costs on local governments may include:

(a) Reducing, modifying, or eliminating substantive regulatory requirements;

(b) Delaying compliance timetables;

(d) Any other mitigation techniques.

NEW SECTION. Sec. 7. (1) A local government impact statement must include a brief description of the reporting, recordkeeping, and other compliance requirements of the proposed rule, and the kinds of regulatory changes a local government would need to implement to comply with such requirements. It shall analyze the costs of compliance for local governments required to comply with the proposed rule, including costs of labor, planning, implementation, court defense, and administrative costs. It shall consider, based on input received from local governments affected, whether compliance with the rule will result in a total cost of fifty thousand dollars or more to any one jurisdiction.

(2) A local government impact statement must also include:

(a) A statement of the steps taken by the agency to reduce the costs of the rule on local jurisdictions as required by section 6 of this act, or reasonable justification for not doing so, addressing the options listed in section 6 of this act;

(b) A description of how the agency will involve local governments in the development of the rule; and

(3) To obtain information for purposes of this section, an agency may survey a representative sample of affected local governments or their associations, and should, whenever possible, appoint a committee under RCW 34.05.310(2) to assist in the accurate assessment of the costs of a proposed rule, and the means to reduce the costs imposed on local governments.

NEW SECTION. Sec. 8. This chapter may be known and cited as the local government regulatory fairness act of 2001.

NEW SECTION. Sec. 9. Sections 1, 2, and 5 through 8 of this act constitute a new chapter in Title 34 RCW.

NEW SECTION. Sec. 10. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.