BILL REQ. #:  S-3297.2 

Read first time 01/11/10.   Referred to Committee on Judiciary.

     AN ACT Relating to the administrative procedure act; amending RCW 34.05.360, 34.05.534, 34.05.554, 34.05.566, 34.05.558, 34.05.570, and 34.05.010; and adding new sections to chapter 34.05 RCW.

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

Sec. 1   RCW 34.05.360 and 1988 c 288 s 311 are each amended to read as follows:
     The order of adoption by which each rule is adopted by an agency shall contain all of the following:
     (1) The date the agency adopted the rule;
     (2) A concise statement of the purpose of the rule;
     (3) A reference to all rules repealed, amended, or suspended by the rule;
     (4) A reference to the specific statutory or other authority authorizing adoption of the rule;
     (5) Any findings required by any provision of law as a precondition to adoption or effectiveness of the rule; ((and))
     (6) The effective date of the rule if other than that specified in RCW 34.05.380(2); and
     (7) The number of votes for and against adoption of the rule, if the rule-making authority includes more than one person.

NEW SECTION.  Sec. 2   A new section is added to chapter 34.05 RCW to read as follows:
     Adoption of a rule requires an affirmative vote of the majority of all members of a body that has the legal authority to adopt an agency's rules. An affirmative vote of a majority of the members present is not sufficient to adopt a rule. Ex officio members may not participate in rule making and may not be considered when counting a majority of the members of the body to determine the necessary votes to adopt a rule.

Sec. 3   RCW 34.05.534 and 1997 c 409 s 302 are each amended to read as follows:
     (1) A person may file a petition for judicial review under this chapter only after exhausting all administrative remedies available within the agency whose action is being challenged, or available within any other agency authorized to exercise administrative review, except:
     (((1))) (a) A petitioner for judicial review of a rule need not have participated in the rule-making proceeding upon which that rule is based, have petitioned for its amendment or repeal, have petitioned the joint administrative rules review committee for its review, or have appealed a petition for amendment or repeal to the governor;
     (((2))) (b) A petitioner for judicial review need not exhaust administrative remedies to the extent that this chapter or any other statute states that exhaustion is not required; or
     (((3))) (c) The court may relieve a petitioner of the requirement to exhaust any or all administrative remedies upon a showing that:
     (((a))) (i) The remedies would be patently inadequate;
     (((b))) (ii) The exhaustion of remedies would be futile; or
     (((c))) (iii) The grave irreparable harm that would result from having to exhaust administrative remedies would clearly outweigh the public policy requiring exhaustion of administrative remedies.
     (2) An agency must identify and consolidate any and all legal challenges or defenses to a petition in its initial answer. An agency may not omit a claim or defense and raise the defense or claim later in the review proceedings or in another action. All grounds to deny a petitioner's request must be identified in the agency's initial response and consolidated into one proceeding.

Sec. 4   RCW 34.05.554 and 1988 c 288 s 512 are each amended to read as follows:
     (1) Issues not raised before the agency may not be raised on appeal, except to the extent that:
     (a) The person did not know and was under no duty to discover or could not have reasonably discovered facts giving rise to the issue;
     (b) The agency action subject to judicial review is a rule and the person has not been a party in adjudicative proceedings that provided an adequate opportunity to raise the issue;
     (c) The agency action subject to judicial review is an order and the person was not notified of the adjudicative proceeding in substantial compliance with this chapter; or
     (d) The interests of justice would be served by resolution of an issue arising from:
     (i) A change in controlling law occurring after the agency action; or
     (ii) Agency action occurring after the person exhausted the last feasible opportunity for seeking relief from the agency.
     (2) The court shall remand to the agency for determination any issue that is properly raised pursuant to subsection (1) of this section.
     (3) An agency may not raise a defense or theory to oppose a petition that it has failed to identify in its answer to a petition.

Sec. 5   RCW 34.05.566 and 1989 c 175 s 26 are each amended to read as follows:
     (1) Within thirty days after service of the petition for judicial review, or within further time allowed by the court or by other provision of law, the agency shall transmit to the court the original or a certified copy of the agency record for judicial review of the agency action. The record shall consist of any agency documents expressing the agency action, other documents identified by the agency as having been considered by it before its action and used as a basis for its action, and any other material described in this chapter as the agency record for the type of agency action at issue, subject to the provisions of this section. An agency must transcribe or certify audio recordings of oral presentations at adjudicative proceedings.
     (2) If part of the record has been preserved without a transcript, the agency shall prepare a transcript for inclusion in the record transmitted to the court, except for portions that the parties stipulate to omit in accordance with subsection (4) of this section.
     (3) The agency may charge a nonindigent petitioner with the reasonable costs of preparing any necessary copies and transcripts for transmittal to the court. A failure by the petitioner to pay any of this cost to the agency relieves the agency from the responsibility for preparation of the record and transmittal to the court.
     (4) The record may be shortened, summarized, or organized temporarily or, by stipulation of all parties, permanently.
     (5) The court may tax the cost of preparing transcripts and copies of the record:
     (a) Against a party who unreasonably refuses to stipulate to shorten, summarize, or organize the record; or
     (b) In accordance with any provision of law.
     (6) Additions to the record pursuant to RCW 34.05.562 must be made as ordered by the court.
     (7) The court may require or permit subsequent corrections or additions to the record.

Sec. 6   RCW 34.05.558 and 1988 c 288 s 513 are each amended to read as follows:
     Judicial review of disputed issues of fact shall be conducted by the court without a jury and must be confined to the agency record for judicial review as defined by this chapter, supplemented by additional evidence taken pursuant to this chapter. The court may consider certified audio recordings, meeting minutes, or transcripts of adjudicative proceedings without supplementing the record. The certified audio recordings, meeting minutes, or transcripts of adjudicative proceedings may be attached to a declaration or brief as an appendix for the court's consideration when relevant to the issues before the court.

Sec. 7   RCW 34.05.570 and 2004 c 30 s 1 are each amended to read as follows:
     (1) Generally. Except to the extent that this chapter or another statute provides otherwise:
     (a) The burden of demonstrating the invalidity of agency action is on the party asserting invalidity;
     (b) The burden of proof required of any agency action related to a license is clear, cogent, and convincing;
     (c) The validity of agency action shall be determined in accordance with the standards of review provided in this section, as applied to the agency action at the time it was taken;
     (((c))) (d) The court shall make a separate and distinct ruling on each material issue on which the court's decision is based; and
     (((d))) (e) The court shall grant relief only if it determines that a person seeking judicial relief has been substantially prejudiced by the action complained of.
     (2) Review of rules. (a) A rule may be reviewed by petition for declaratory judgment filed pursuant to this subsection or in the context of any other review proceeding under this section. In an action challenging the validity of a rule, the agency shall be made a party to the proceeding.
     (b)(i) The validity of any rule may be determined upon petition for a declaratory judgment addressed to the superior court of Thurston county, when it appears that the rule, or its threatened application, interferes with or impairs or immediately threatens to interfere with or impair the legal rights or privileges of the petitioner. The declaratory judgment order may be entered whether or not the petitioner has first requested the agency to pass upon the validity of the rule in question. A petition for declaratory judgment to invalidate a rule filed directly in superior court of Thurston county may be served upon the agency and the attorney general's office. The petitioner may not be required to serve any other person or entity. The agency shall post notice of the declaratory judgment filing in the same manner as it posts notice of proposed rule making under this chapter. The parties may proceed with reasonable discovery under the civil rules to present evidence not available in the official rule-making file.
     (ii) From June 10, 2004, until July 1, 2008:
     (A) If the petitioner's residence or principal place of business is within the geographical boundaries of the third division of the court of appeals as defined by RCW 2.06.020(3), the petition may be filed in the superior court of Spokane, Yakima, or Thurston county; and
     (B) If the petitioner's residence or principal place of business is within the geographical boundaries of district three of the first division of the court of appeals as defined by RCW 2.06.020(1), the petition may be filed in the superior court of Whatcom or Thurston county.
     (c) In a proceeding involving review of a rule, the court shall declare the rule invalid only if it finds that: The rule violates constitutional provisions; the rule exceeds the statutory authority of the agency; the rule was adopted without compliance with statutory rule-making procedures; or the rule is arbitrary and capricious.
     (3) Review of agency orders in adjudicative proceedings. The court shall grant relief from an agency order in an adjudicative proceeding only if it determines that:
     (a) The order, or the statute or rule on which the order is based, is in violation of constitutional provisions on its face or as applied. When the review concerns a license, the action necessarily concerns a life, liberty, and property interest of the petitioner for purposes of constitutional analysis;
     (b) The order is outside the statutory authority or jurisdiction of the agency conferred by any provision of law;
     (c) The agency has engaged in unlawful procedure or decision-making process, or has failed to follow a prescribed procedure;
     (d) The agency has erroneously interpreted or applied the law;
     (e) The order is not supported by evidence that is substantial when viewed in light of the whole record before the court, which includes the agency record for judicial review, supplemented by any additional evidence received by the court under this chapter;
     (f) The agency has not decided all issues requiring resolution by the agency;
     (g) A motion for disqualification under RCW 34.05.425 or 34.12.050 was made and was improperly denied or, if no motion was made, facts are shown to support the grant of such a motion that were not known and were not reasonably discoverable by the challenging party at the appropriate time for making such a motion;
     (h) The order is inconsistent with a rule of the agency unless the agency explains the inconsistency by stating facts and reasons to demonstrate a rational basis for inconsistency; or
     (i) The order is arbitrary or capricious.
     (4) Review of other agency action.
     (a) All agency action not reviewable under subsection (2) or (3) of this section shall be reviewed under this subsection.
     (b) A person whose rights are violated by an agency's failure to perform a duty that is required by law to be performed may file a petition for review pursuant to RCW 34.05.514, seeking an order pursuant to this subsection requiring performance. Within twenty days after service of the petition for review, the agency shall file and serve an answer to the petition, made in the same manner as an answer to a complaint in a civil action. The court may hear evidence, pursuant to RCW 34.05.562, on material issues of fact raised by the petition and answer.
     (c) Relief for persons aggrieved by the performance of an agency action, including the exercise of discretion, or an action under (b) of this subsection can be granted only if the court determines that the action is:
     (i) Unconstitutional. When the review concerns a license, the action necessarily concerns a life, liberty, and property interest of the petitioner for purposes of constitutional analysis;
     (ii) Outside the statutory authority of the agency or the authority conferred by a provision of law;
     (iii) Arbitrary or capricious; or
     (iv) Taken by persons who were not properly constituted as agency officials lawfully entitled to take such action.

Sec. 8   RCW 34.05.010 and 1997 c 126 s 2 are each amended to read as follows:
     The definitions set forth in this section shall apply throughout this chapter, unless the context clearly requires otherwise.
     (1) "Adjudicative proceeding" means a proceeding before an agency in which an opportunity for hearing before that agency is required by statute or constitutional right before or after the entry of an order by the agency. Adjudicative proceedings also include all cases of licensing and rate making in which an application for a license or rate change is denied except as limited by RCW 66.08.150, or a license is revoked, suspended, or modified, or in which the granting of an application is contested by a person having standing to contest under the law.
     (2) "Agency" means any state board, commission, department, institution of higher education, or officer, authorized by law to make rules or to conduct adjudicative proceedings, except those in the legislative or judicial branches, the governor, or the attorney general except to the extent otherwise required by law and any local governmental entity that may request the appointment of an administrative law judge under chapter 42.41 RCW.
     (3) "Agency action" means licensing, the implementation or enforcement of a statute, the adoption or application of an agency rule or order, the imposition of sanctions, or the granting or withholding of benefits.
     Agency action does not include an agency decision regarding (a) contracting or procurement of goods, services, public works, and the purchase, lease, or acquisition by any other means, including eminent domain, of real estate, as well as all activities necessarily related to those functions, or (b) determinations as to the sufficiency of a showing of interest filed in support of a representation petition, or mediation or conciliation of labor disputes or arbitration of labor disputes under a collective bargaining law or similar statute, or (c) any sale, lease, contract, or other proprietary decision in the management of public lands or real property interests, or (d) the granting of a license, franchise, or permission for the use of trademarks, symbols, and similar property owned or controlled by the agency.
     (4) "Agency head" means the individual or body of individuals in whom the ultimate legal authority of the agency is vested by any provision of law. If the agency head is a body of individuals, a majority of those individuals constitutes the agency head.
     (5) "Entry" of an order means the signing of the order by all persons who are to sign the order, as an official act indicating that the order is to be effective.
     (6) "Filing" of a document that is required to be filed with an agency means delivery of the document to a place designated by the agency by rule for receipt of official documents, or in the absence of such designation, at the office of the agency head.
     (7) "Institutions of higher education" are the University of Washington, Washington State University, Central Washington University, Eastern Washington University, Western Washington University, The Evergreen State College, the various community colleges, and the governing boards of each of the above, and the various colleges, divisions, departments, or offices authorized by the governing board of the institution involved to act for the institution, all of which are sometimes referred to in this chapter as "institutions."
     (8) "Interpretive statement" means a written expression of the opinion of an agency, entitled an interpretive statement by the agency head or its designee, as to the meaning of a statute or other provision of law, of a court decision, or of an agency order.
     (9)(a) "License" means a franchise, permit, certification, approval, registration, charter, or similar form of authorization required by law, but does not include (i) a license required solely for revenue purposes, or (ii) a certification of an exclusive bargaining representative, or similar status, under a collective bargaining law or similar statute, or (iii) a license, franchise, or permission for use of trademarks, symbols, and similar property owned or controlled by the agency. Even if an agency does not use the term "license," the required agency authorization is a license under this chapter if an agency requires its consent before a person or entity may provide services, or use products, equipment, or specific sites or locations. Whether a license is a professional license, an occupational license, a product or equipment license, or a site license is a distinction that may not impact the rights of the licensee specified in this chapter.
     (b) "Licensing" includes the agency process respecting the issuance, denial, revocation, suspension, or modification of a license.
     (10) "Mail" or "send," for purposes of any notice relating to rule making or policy or interpretive statements, means regular mail or electronic distribution, as provided in RCW 34.05.260. "Electronic distribution" or "electronically" means distribution by electronic mail or facsimile mail.
     (11)(a) "Order," without further qualification, means a written statement of particular applicability that finally determines the legal rights, duties, privileges, immunities, or other legal interests of a specific person or persons.
     (b) "Order of adoption" means the official written statement by which an agency adopts, amends, or repeals a rule.
     (12) "Party to agency proceedings," or "party" in a context so indicating, means:
     (a) A person to whom the agency action is specifically directed; or
     (b) A person named as a party to the agency proceeding or allowed to intervene or participate as a party in the agency proceeding.
     (13) "Party to judicial review or civil enforcement proceedings," or "party" in a context so indicating, means:
     (a) A person who files a petition for a judicial review or civil enforcement proceeding; or
     (b) A person named as a party in a judicial review or civil enforcement proceeding, or allowed to participate as a party in a judicial review or civil enforcement proceeding.
     (14) "Person" means any individual, partnership, corporation, association, governmental subdivision or unit thereof, or public or private organization or entity of any character, and includes another agency.
     (15) "Policy statement" means a written description of the current approach of an agency, entitled a policy statement by the agency head or its designee, to implementation of a statute or other provision of law, of a court decision, or of an agency order, including where appropriate the agency's current practice, procedure, or method of action based upon that approach.
     (16) "Rule" means any agency order, directive, or regulation of general applicability (a) the violation of which subjects a person to a penalty or administrative sanction; (b) which establishes, alters, or revokes any procedure, practice, or requirement relating to agency hearings; (c) which establishes, alters, or revokes any qualification or requirement relating to the enjoyment of benefits or privileges conferred by law; (d) which establishes, alters, or revokes any qualifications or standards for the issuance, suspension, or revocation of licenses to pursue any commercial activity, trade, or profession; or (e) which establishes, alters, or revokes any mandatory standards for any product or material which must be met before distribution or sale. The term includes the amendment or repeal of a prior rule, but does not include (i) statements concerning only the internal management of an agency and not affecting private rights or procedures available to the public, (ii) declaratory rulings issued pursuant to RCW 34.05.240, (iii) traffic restrictions for motor vehicles, bicyclists, and pedestrians established by the secretary of transportation or his designee where notice of such restrictions is given by official traffic control devices, or (iv) rules of institutions of higher education involving standards of admission, academic advancement, academic credit, graduation and the granting of degrees, employment relationships, or fiscal processes.
     (17) "Rules review committee" or "committee" means the joint administrative rules review committee created pursuant to RCW 34.05.610 for the purpose of selectively reviewing existing and proposed rules of state agencies.
     (18) "Rule making" means the process for formulation and adoption of a rule.
     (19) "Service," except as otherwise provided in this chapter, means posting in the United States mail, properly addressed, postage prepaid, or personal service. Service by mail is complete upon deposit in the United States mail. Agencies may, by rule, authorize service by electronic telefacsimile transmission, where copies are mailed simultaneously, or by commercial parcel delivery company.

NEW SECTION.  Sec. 9   A new section is added to chapter 34.05 RCW to read as follows:
     All materials made available to boards and commissions in the boards and commissions notebooks prepared by the agency for their meetings shall be posted electronically on the agency web site in advance of the meeting when the agency publishes the agenda. Any materials not subject to public disclosure may be redacted or withheld.