AN ACT Relating to regulatory fairness; amending RCW 19.85.020, 19.85.030, and 19.85.040; adding new sections to chapter 19.85 RCW; and adding new sections to chapter 34.05 RCW.

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

Sec. 1. Section 2, chapter 6, Laws of 1982 and RCW 19.85.020 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 ((~~43.31.920~~)) 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 standard industrial classification as published by the United States department of commerce.

Sec. 2. Section 3, chapter 6, Laws of 1982 and RCW 19.85.030 are each amended to read as follows:

In the adoption of any rule pursuant to RCW ((~~34.04.025~~)) 34.05.320 which 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;

(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 ((~~34.04.025~~)) 34.05.320;

(3) May request assistance from the ((~~office of small business available statistics which the agency can use~~)) business assistance center in the preparation of the small business economic impact statement.

Sec. 3. Section 4, chapter 6, Laws of 1982 and RCW 19.85.040 are each amended to read as follows:

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 ((~~34.04.025~~)) 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).

NEW SECTION. Sec. 4. A new section is added to chapter 19.85 RCW to read as follows:

When any rule is proposed for which a small business economic impact statement is required, the agency shall assure that small businesses have been given notice of the proposed rule through any of the following that may apply:

(1) Direct notification of known interested small businesses affected by the proposed rule;

(2) Notice to business or trade organizations;

(3) Publication of a general notice of the proposed rule making in publications likely to be obtained by small businesses of the types affected by the proposed rule; and

(4) The appointment of a committee, as provided in RCW 34.05.310, to comment on the subject of the possible rule making before the publication of notice of proposed rule adoption under RCW 34.05.320.

NEW SECTION. Sec. 5. A new section is added to chapter 19.85 RCW to read as follows:

An agency is not required to prepare a small business economic impact statement if the agency files a statement that:

(1) The rule is being adopted solely for the purpose of conformity or compliance, or both, with federal law or regulations; or

(2) The rule will have a minor or negligible economic impact. The business assistance center shall develop guidelines for determining whether a proposed rule will have minor or negligible impacts. The business assistance center may review a proposed rule that indicates that there is only a minor or negligible economic impact to determine if the agency's finding is within the guidelines developed by the business assistance center. The business assistance center is authorized to advise the joint administrative rules review committee on disputes involving agency determinations under this section.

NEW SECTION. Sec. 6. A new section is added to chapter 34.05 RCW to read as follows:

The joint administrative rules review committee may review any rule to determine whether an agency complied with the regulatory business requirements of chapter 19.85 RCW.

NEW SECTION. Sec. 7. A new section is added to chapter 34.05 RCW to read as follows:

The joint administrative rules review committee shall provide notice, conduct its hearings and reviews, and provide notice of committee objections to small business economic impact statements required under chapter 19.85 RCW in the same manner as is provided for notice, hearings, reviews, and objections to rules under this chapter.