SENATE BILL REPORT

SB 5542

BYSenator Lee

Providing for review of regulatory rules.

Senate Committee on Economic Development & Labor

Senate Hearing Date(s):February 9, 1989; February 14, 1989

Majority Report:  That Substitute Senate Bill No. 5542 be substituted therefor, and the substitute bill do pass.

      Signed by Senators Lee, Chairman; Anderson, Vice Chairman; Matson, Murray, Saling, Smitherman, Warnke.

Senate Staff:Patrick Woods (786-7430)

                  February 15, 1989

AS REPORTED BY COMMITTEE ON ECONOMIC DEVELOPMENT & LABOR, FEBRUARY 14, 1989

BACKGROUND:

The issue of nonprofit corporations competing with the private sector has received legislative attention during recent years.  In testimony before legislative committees, it was reported that nonprofit corporations were "unfairly" competing with private sector businesses in providing goods and services.

During 1988 a select committee on nonprofit competition was established to provide the Legislature with a careful and comprehensive review of this issue, upon which public policy decisions could be made.  The committee was comprised of members of the Senate, nonprofit community, business community and state agencies.  The committee published a report which included a recommendation that the Business Assistance Center within the Department of Trade and Economic Development should be authorized to review state regulations affecting nonprofit and for-profit businesses to insure parity in the treatment of both sectors.

SUMMARY:

The Business Assistance Center within the Department of Trade and Economic Development is authorized to act as the primary agency of state government to respond to complaints regarding administrative rules that unduly favor either the for-profit or nonprofit business sectors.  An individual who considers that administrative rules adopted by a state agency unduly favor either the for-profit corporations or nonprofit corporations is required to submit a complaint in writing to the center.  The center is authorized to:  conduct background research; request information from agencies promulgating the rules; and arrange meetings with interested parties.

Upon determining a case of preferential treatment between a for-profit or nonprofit corporation, the center is required to notify the affecting agency and request appropriate modifications.  If remedial action is not taken, the center may refer the issue to the Joint Administrative Rules Review Committee.

EFFECT OF PROPOSED SUBSTITUTE:

The Business Assistance Center's authorization to refer an agency's proposed rule to the Joint Administrative Rules Review Committee is clarified.

The center may adopt rules to administer the act.

Appropriation:    none

Revenue:    none

Fiscal Note:      none requested

Senate Committee - Testified: Ben Lindekugel, United Way of King County (pro); Larry Kenney, State Labor Council (pro); Sharon Foster, YMCAs of Washington (pro); Dave Dougherty, BAC (pro); Michael Doctor, Sheltered Workshops (pro); Doug Bohlke, ESTA (pro)