BILL REQ. #:  S-3874.1 

Read first time 01/14/08.   Referred to Committee on Transportation.

     AN ACT Relating to clarification of pilot rule making; and amending RCW 34.05.310, 34.05.313, 34.05.315, and 34.05.335.

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

Sec. 1   RCW 34.05.310 and 2004 c 31 s 1 are each amended to read as follows:
     (1) To meet the intent of providing greater public access to administrative rule making and to promote consensus among interested parties, agencies shall solicit comments from the public on a subject of possible rule making before filing with the code reviser a notice of proposed rule making under RCW 34.05.320. The agency shall prepare a statement of inquiry that:
     (a) Identifies the specific statute or statutes authorizing the agency to adopt rules on this subject;
     (b) Discusses why rules on this subject may be needed and what they might accomplish;
     (c) Identifies other federal and state agencies that regulate this subject, and describes the process whereby the agency would coordinate the contemplated rule with these agencies;
     (d) Discusses the process by which the rule might be developed, including, but not limited to, negotiated rule making, pilot rule making, or agency study;
     (e) Specifies the process by which interested parties can effectively participate in the decision to adopt a new rule and formulation of a proposed rule before its publication.
     The statement of inquiry for all except pilot projects shall be filed with the code reviser for publication in the state register at least thirty days before the date the agency files notice of proposed rule making under RCW 34.05.320 and the statement, or a summary of the information contained in that statement, shall be sent to any party that has requested receipt of the agency's statements of inquiry.
     For pilot projects, the statement of inquiry shall be filed with the code reviser for publication in the Washington State Register at the time of or up to twenty days before the first public notice required by RCW 34.05.313(1).
     (2) Agencies are encouraged to develop and use new procedures for reaching agreement among interested parties before publication of notice and the adoption hearing on a proposed rule. Examples of new procedures include, but are not limited to:
     (a) Negotiated rule making by which representatives of an agency and of the interests that are affected by a subject of rule making, including, where appropriate, county and city representatives, seek to reach consensus on the terms of the proposed rule and on the process by which it is negotiated; and
     (b) Pilot rule making which includes testing the feasibility of complying with or administering draft new rules or draft amendments to existing rules through the use of volunteer pilot groups in various areas and circumstances, as provided in RCW 34.05.313 or as otherwise provided by the agency.
     (3)(a) An agency must make a determination whether negotiated rule making, pilot rule making, or another process for generating participation from interested parties prior to development of the rule is appropriate.
     (b) An agency must include a written justification in the rule-making file if an opportunity for interested parties to participate in the rule-making process prior to publication of the proposed rule has not been provided.
     (4) This section does not apply to:
     (a) Emergency rules adopted under RCW 34.05.350;
     (b) Rules relating only to internal governmental operations that are not subject to violation by a nongovernment party;
     (c) Rules adopting or incorporating by reference without material change federal statutes or regulations, Washington state statutes, rules of other Washington state agencies, shoreline master programs other than those programs governing shorelines of statewide significance, or, as referenced by Washington state law, national consensus codes that generally establish industry standards, if the material adopted or incorporated regulates the same subject matter and conduct as the adopting or incorporating rule;
     (d) Rules that only correct typographical errors, make address or name changes, or clarify language of a rule without changing its effect;
     (e) Rules the content of which is explicitly and specifically dictated by statute;
     (f) Rules that set or adjust fees or rates pursuant to legislative standards; or
     (g) Rules that adopt, amend, or repeal:
     (i) A procedure, practice, or requirement relating to agency hearings; or
     (ii) A filing or related process requirement for applying to an agency for a license or permit.

Sec. 2   RCW 34.05.313 and 1995 c 403 s 303 are each amended to read as follows:
     (1) During the development of a rule or after its adoption, an agency may develop methods for measuring or testing the feasibility of complying with or administering the rule and for identifying simple, efficient, and economical alternatives for achieving the goal of the rule. A pilot project shall include public notice, participation by volunteers who are or will be subject to the rule, a high level of involvement from agency management, stated and reasonable completion dates, and a process by which one or more parties may withdraw from the process or the process may be terminated. Volunteers who agree to test a rule and attempt to meet the requirements of the draft rule, to report periodically to the proposing agency on the extent of their ability to meet the requirements of the draft rule, and to make recommendations for improving the draft rule shall not be obligated to comply fully with the rule being tested nor be subject to any enforcement action or other sanction for failing to comply with the requirements of the draft rule.
     (2) An agency conducting a pilot rule project authorized under subsection (1) of this section may waive one or more provisions of agency rules otherwise applicable to participants in such a pilot project if the agency first determines that such a waiver is in the public interest and necessary to conduct the project. Such a waiver may be only for a stated period of time, not to exceed the duration of the project, as required to be stated in subsection (1) of this section.
     (3) No qualification or requirement relating to the enjoyment of benefits or privileges conferred by law is established, altered, or revoked for any participant in a pilot project.
     (4) The findings of the pilot project should be widely shared and, where appropriate, adopted as amendments to the rule.
     (((4))) (5) If an agency conducts a pilot rule project in lieu of meeting the requirements of the regulatory fairness act, chapter 19.85 RCW, the agency shall ensure the following conditions are met:
     (a) If over ten small businesses are affected, there shall be at least ten small businesses in the test group and at least one-half of the volunteers participating in the pilot test group shall be small businesses.
     (b)(i) If there are at least one hundred businesses affected, the participation by small businesses in the test group shall be as follows:
     (A) Not less than twenty percent of the small businesses must employ twenty-six to fifty employees;
     (B) Not less than twenty percent of the small businesses must employ eleven to twenty-six employees; and
     (C) Not less than twenty percent of the small businesses must employ zero to ten employees.
     (ii) If there do not exist a sufficient number of small businesses in each size category set forth in (b)(i) of this subsection willing to participate in the pilot project to meet the minimum requirements of that subsection, then the agency must comply with this section to the maximum extent practicable.
     (c) The agency may not terminate the pilot project before completion.
     (d) Before filing the notice of proposed rule making pursuant to RCW 34.05.320, the agency must prepare a report of the pilot rule project that includes:
     (i) A description of the difficulties small businesses had in complying with the pilot rule;
     (ii) A list of the recommended revisions to the rule to make compliance with the rule easier or to reduce the cost of compliance with the rule by the small businesses participating in the pilot rule project;
     (iii) A written statement explaining the options it considered to resolve each of the difficulties described and a statement explaining its reasons for not including a recommendation by the pilot test group to revise the rule; and
     (iv) If the agency was unable to meet the requirements set forth in (b)(i) of this subsection, a written explanation of why it was unable to do so and the steps the agency took to include small businesses in the pilot project.

Sec. 3   RCW 34.05.315 and 1989 c 175 s 6 are each amended to read as follows:
     (1) Each agency shall maintain a current public rule-making docket. The rule-making docket shall contain the information specified in subsections (3) and (4) of this section.
     (2) The rule-making docket shall contain a listing of each pending rule-making proceeding. A rule-making proceeding for a proposed rule is pending from the time it is commenced by publication of a notice of proposed rule adoption under RCW 34.05.320 until the proposed rule is withdrawn under RCW 34.05.335 or is adopted by the agency. A rule-making proceeding for a pilot project is pending from the time it is commenced by publication of the statement of inquiry under RCW 34.05.310 until the pilot project is withdrawn under RCW 34.05.335 or is proposed as a rule by the agency.
     (3) For each rule-making proceeding, the docket shall indicate all of the following:
     (a) The name and address of agency personnel responsible for the proposed rule;
     (b) The subject of the proposed rule;
     (c) A citation to all notices relating to the proceeding that have been published in the state register under RCW 34.05.320;
     (d) The place where written submissions about the proposed rule may be inspected;
     (e) The time during which written submissions will be accepted; and
     (f) The current timetable established for the agency proceeding, including the time and place of any rule-making hearing, the date of the rule's adoption, filing, publication, and its effective date.
     (4) For each pilot project, the docket shall indicate all of the following:
     (a) The name and address of agency personnel responsible for the pilot project;
     (b) The subject of the pilot project;
     (c) A citation to all notices relating to the proceeding that have been published under RCW 34.05.313;
     (d) The place where written submissions about the pilot project may be inspected;
     (e) The time during which written submissions will be accepted; and
     (f) The current timetable established for the agency proceeding, including the time and place of any hearing on the pilot project, and the date of the pilot project's completion.

Sec. 4   RCW 34.05.335 and 1989 c 175 s 8 are each amended to read as follows:
     (1)(a) A proposed rule may be withdrawn by the proposing agency at any time before adoption. A withdrawn rule may not be adopted unless it is again proposed in accordance with RCW 34.05.320.
     (b) A pilot project may be withdrawn by the proposing agency at any time before it is proposed as a rule for adoption under RCW 34.05.320. A withdrawn pilot project may not be continued unless it is again proposed in accordance with RCW 34.05.310 and 34.05.313.
     (2) Before adopting a rule, an agency shall consider the written and oral submissions, or any memorandum summarizing oral submissions.
     (3) Pilot projects not proposed as rules and rules not adopted and filed with the code reviser within one hundred eighty days after publication of the text as last proposed in the register shall be regarded as withdrawn. An agency may not thereafter continue the pilot project or adopt the proposed rule without refiling ((it)) the pilot project in accordance with RCW 34.05.310 or refiling the rule in accordance with RCW 34.05.320. The code reviser shall give notice of the withdrawal in the register.
     (4) An agency may not adopt a rule before the time established in the published notice, or such later time established on the record or by publication in the state register.