BILL REQ. #:  H-0355.2 

Read first time 01/21/11.   Referred to Committee on State Government & Tribal Affairs.

     AN ACT Relating to providing limitations for the imposition of regulatory civil penalties; adding a new section to chapter 34.05 RCW; and creating new sections.

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

NEW SECTION.  Sec. 1   The legislature finds that there have been instances where regulatory agencies discovered actions by a regulated entity that are in error after reports have been accepted and approved or inspections have been conducted and approved. Retroactively applying fines after governmental approval creates an unfriendly business environment and can place unexpected financial burdens on businesses. Businesses should be able to rely on government approval and acceptance of reports and inspections and not risk penalties when mistakes are made by government personnel or contractors. It is the intent of the legislature that regulated parties who have received acceptance and approval by the regulating government authority should not be subsequently fined or penalized, but should be encouraged to correct action that is deemed in error or violates reporting or inspection requirements during the next reporting period. The regulating authority should notify the regulated party of the violation to prevent future violations.

NEW SECTION.  Sec. 2   A new section is added to chapter 34.05 RCW to read as follows:
     (1) An agency may not issue a fine or impose a penalty on a person if:
     (a) An inspection is approved by an official of the agency requiring the inspection and a subsequent reevaluation of the approved inspection by the regulating agency identifies a violation by the regulated party; or
     (b) Documentation required under an agency's reporting requirements is submitted to the agency by a regulated party and is accepted and approved by the regulating agency and a subsequent reevaluation of the approved documentation identifies a violation based on failure to provide required documentation or information.
     (2) A rule adopted under this chapter may not authorize the imposition of a civil fine on a person based on the following circumstances if:
     (a) An inspection is approved by an official of the agency requiring the inspection and a subsequent reevaluation of the approved inspection by the regulating agency identifies a violation by the regulated party; or
     (b) Documentation required under an agency's reporting requirements is submitted to the agency by a regulated party and is accepted and approved by the regulating agency and a subsequent reevaluation of the approved documentation identifies a violation based on failure to provide required documentation or information.
     (3) Violations identified after an inspection or documentation has been approved may be remedied through technical assistance provided to the regulated party allowing correction of the circumstances of the violation for future reporting periods or inspections.

NEW SECTION.  Sec. 3   If any part of this act is found to be in conflict with federal requirements that are a prescribed condition to the allocation of federal funds to the state, the conflicting part of this act is inoperative solely to the extent of the conflict and with respect to the agencies directly affected, and this finding does not affect the operation of the remainder of this act in its application to the agencies concerned. Rules adopted under this act must meet federal requirements that are a necessary condition to the receipt of federal funds by the state.