LRB-0824/1
RPN:kmg:cph
2003 - 2004 LEGISLATURE
April 9, 2003 - Introduced by Senators Welch, Schultz, Roessler, Reynolds,
Stepp, Brown, Kanavas, S. Fitzgerald, Lazich
and Leibham, cosponsored by
Representatives McCormick, J. Fitzgerald, Suder, Krawczyk, Friske,
Vrakas, Gunderson, Hundertmark, Seratti, Pettis, Albers, Stone, Hines,
Musser, Bies, Hahn, Wieckert, Underheim, Nischke, Staskunas, Ladwig,
Kreibich, Olsen, Van Roy, Plale, Ziegelbauer, J. Wood, Powers, Schooff,
Ott, Balow
and Lassa. Referred to Committee on Homeland Security,
Veterans and Military Affairs and Government Reform.
SB100,1,7 1An Act to amend 227.114 (1) (a), 227.114 (2) (intro.), 227.485 (2) (c) and 814.245
2(5) (a) 2.; and to create 15.155 (5), 227.114 (6m), 227.114 (7m), 227.135 (1) (e),
3227.14 (2m), 227.14 (2t), 227.15 (1m), 227.19 (3r), 227.22 (2) (e), 227.24 (3m),
4227.30, 227.40 (2) (f) and 895.59 of the statutes; relating to: administrative
5rule making regarding small businesses, data used by administrative agencies
6in preparing proposed rules, increasing attorney fees, creating an Internet site
7for proposed rules, and creating a Small Business Regulatory Review Board.
Analysis by the Legislative Reference Bureau
Under current law, an agency that proposes an administrative rule that affects
small businesses (a business that employs fewer than 25 full-time employes or has
gross annual sales of less than $2,500,000), is required to consider ways to reduce the
impact of the rule on small businesses, including creating less stringent compliance
requirements for small businesses or exempting small businesses from the rule.
Currently, the agency proposing the rule must give small businesses the opportunity
to participate in the rule-making process. Agencies are also currently required to
prepare a regulatory flexibility analysis of any rule that affects a small business,
including a summary of changes made in the rule as a result of suggestions by small
businesses and the estimated costs that small businesses may incur to comply with
the proposed rule.

This bill creates a Small Business Regulatory Review Board and requires an
agency to submit to that board any proposed rule that may have a significant
economic impact on small businesses. The board is authorized to analyze the rule
and notify the proposing agency if the board determines that the agency failed to
consider ways to reduce the proposed rule's impact on small businesses or failed to
properly prepare the regulatory flexibility analysis. The board may suggest ways
that the agency can modify the rule and may return the rule to the agency if the rule
does not detail how the rule will be enforced.
The bill redefines "small business" to include any business with 25 or fewer
employees or with gross annual sales of less than $5,000,000. The bill requires every
agency, in cooperation with the Department of Administration, to ensure the
accuracy, integrity, and consistency of the data that the agency uses when preparing
a proposed rule. The bill gives small businesses the right to seek an injunction
against the imposition of a penalty from an agency resulting from the small
business's action that was in response to inaccurate information provided by the
agency.
The bill requires the Joint Legislative Council to create an Internet site that
includes a copy of each proposed rule that is submitted to the council. The site must
be searchable and include a section devoted to proposed rules affecting small
businesses, an electronic address and telephone number of an agency contact for a
rule, the council's report on the proposed rule, the time and place of any public
hearing on the proposed rule, and the place where comments may be submitted
regarding a proposed rule.
The bill requires every state agency to review all of its rules during the next five
years to determine if any of the rules place an unnecessary burden on small
businesses, and to repeal or amend any rules that do so.
The bill also gives immunity from imposition of a penalty to any small business
that voluntarily discloses information to the appropriate agency about a possible
violation of an administrative rule if a number of conditions are met, including the
business making the disclosure within 45 days after learning of the violation,
making a good faith effort to comply with the rule, and cooperating with the agency
in any resulting investigation. The immunity does not apply if the violation resulted
in serious harm or in a substantial economic benefit to the violator which gave the
violator an advantage over its business competitors.
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SB100, s. 1 1Section 1. 15.155 (5) of the statutes is created to read:
SB100,3,82 15.155 (5) Small business regulatory review board. There is created a small
3business regulatory review board, attached to the department of commerce under s.

115.03. The board shall consist of a representative of the department of
2administration, a representative of the department of agriculture, trade and
3consumer protection, a representative of the department of commerce, a
4representative of the department of natural resources, 5 representatives of small
5businesses, as defined in s. 227.114 (1), who shall be appointed for 3-year terms, and
6the chairpersons of one senate and one assembly committee concerned with small
7businesses. The representatives of the departments shall be selected by the
8secretary of that department.
SB100, s. 2 9Section 2. 227.114 (1) (a) of the statutes is amended to read:
SB100,3,1710 227.114 (1) (a) In this section, "small business" means a business entity,
11including its affiliates, which is independently owned and operated and not
12dominant in its field, and which employs 25 or fewer than 25 full-time employees or
13which has gross annual sales of less than $2,500,000. For purposes of a specific rule,
14an agency may define small business to include more employees or greater gross
15annual sales if necessary to adapt the rule to the needs and problems of small
16businesses. A "small business" may also be defined in accordance with other
17standards established by an agency by rule
$5,000,000.
SB100, s. 3 18Section 3. 227.114 (2) (intro.) of the statutes is amended to read:
SB100,3,2119 227.114 (2) (intro.) When an agency proposes or revises a rule that may have
20an effect on small businesses, the agency shall consider each of the following methods
21for reducing the impact of the rule on small businesses:
SB100, s. 4 22Section 4. 227.114 (6m) of the statutes is created to read:
SB100,4,523 227.114 (6m) If a small business is subject to a penalty from an administrative
24agency as the result of an action or omission by the small business in response to
25inaccurate or inconsistent advice given to the small business by an employee, officer,

1or agent of the agency, the small business may commence an action in the circuit
2court for Dane County for injunctive relief. The circuit court may issue an order
3enjoining the imposition of the penalty if the court determines that the action or
4omission of the small business that resulted in the penalty was in response to the
5agency's inaccurate or inconsistent advice.
SB100, s. 5 6Section 5. 227.114 (7m) of the statutes is created to read:
SB100,4,127 227.114 (7m) The agency shall designate a small business regulatory
8coordinator to act as a contact person for small business regulatory issues. The
9agency shall include in the notice under s. 227.17 the electronic mail address and
10telephone number of the small business regulatory coordinator and a link to an
11Internet site that allows a person to review the rule and make comments regarding
12the rule.
SB100, s. 6 13Section 6. 227.135 (1) (e) of the statutes is created to read:
SB100,4,1414 227.135 (1) (e) A description of all of the entities that will be affected by the rule.
SB100, s. 7 15Section 7. 227.14 (2m) of the statutes is created to read:
SB100,4,2216 227.14 (2m) Quality of agency data. Each agency shall, in cooperation with
17the department of administration, ensure the accuracy, integrity, and consistency of
18the data that is used when preparing a proposed rule and when completing an
19analysis of the proposed rule under sub. (2). Each agency shall reduce the amount
20of cross-references to the statutes in proposed and final rules. A person affected by
21the proposed rule may submit comments to the agency regarding the accuracy,
22integrity, or consistency of that data.
SB100, s. 8 23Section 8. 227.14 (2t) of the statutes is created to read:
SB100,5,324 227.14 (2t) Enforcement provisions. Except as provided in subs. (1m) and (1s),
25each proposed rule shall include provisions detailing how the rule will be enforced.

1If a proposed rule does not include enforcement provisions, the small business
2regulatory review board may return the rule to the submitting agency for an
3appropriate enforcement provision.
SB100, s. 9 4Section 9. 227.15 (1m) of the statutes is created to read:
SB100,5,125 227.15 (1m) Internet access to proposed rule. The joint legislative council
6shall create and maintain an Internet site that includes a copy of each proposed rule
7received under sub. (1) in a format that allows the site to be searched using keywords.
8Each agency shall provide the joint legislative council with the proposed rules and
9other information needed to comply with this subsection in the format required by
10the joint legislative council. The Internet site shall include a section devoted to
11proposed rules affecting small businesses, as defined in s. 227.114 (1). The Internet
12site shall also include all of the following:
SB100,5,1413 (a) The electronic mail address and telephone number of an agency contact
14person for each proposed rule.
SB100,5,1515 (b) The material required under s. 227.14 (2), (3), and (4).
SB100,5,1716 (c) The written report of the legislative council staff review of the proposed rule
17prepared under sub. (2) and any agency comments regarding that report.
SB100,5,2018 (d) The time, date, and place of any public hearing specified in the notice in s.
19227.17 as soon as that notice is submitted to the revisor of statutes under s. 227.17
20(1) (a).
SB100,5,2221 (e) The place where comments on the proposed rule should be submitted and
22the deadline for submitting those comments.
SB100, s. 10 23Section 10. 227.19 (3r) of the statutes is created to read:
SB100,6,1224 227.19 (3r) Fiscal effect of emergency rule. On the same day that an agency
25submits a notice under sub. (2) regarding a proposed rule that may have a significant

1economic impact on small businesses, the agency shall submit the proposed rule and
2the report required under sub. (3) to the small business regulatory review board. The
3board may use cost-benefit analysis to determine the fiscal effect of the emergency
4rule on small businesses and shall determine whether the agency has complied with
5sub. (3) (e) or s. 227.114. If the board determines that the agency failed to comply with
6sub. (3) (e) or s. 227.114, the board shall notify the agency of that determination and
7ask the agency to comply with those provisions. In addition, the board may submit
8suggested changes in the proposed rule to the agency, including proposals to reduce
9the use of cross-references in the rule. The board shall send a copy of any suggestions
10and of any notice of failure to comply with sub. (3) (e) or s. 227.114 to each committee
11to which the proposed rule was referred under sub. (2). The notification of
12noncompliance may include a request that the agency do any of the following:
SB100,6,1413 (a) Explain why the agency has not incorporated comments received from small
14businesses regarding the proposed rule.
SB100,6,1615 (b) Verify that the proposed rule does not conflict with, overlap, or duplicate
16other rules or federal regulations.
SB100,6,1917 (c) Require the inclusion of fee information and fee schedules in the regulatory
18flexibility analysis, including why fees are necessary and for what purpose the fees
19will be used.
SB100, s. 11 20Section 11. 227.22 (2) (e) of the statutes is created to read:
SB100,6,2321 227.22 (2) (e) The rule has a significant economic impact on small businesses,
22as defined in s. 227.114 (1), in which case the rule applies to small businesses on the
23first day of the 3rd month commencing after the date of publication.
SB100, s. 12 24Section 12. 227.24 (3m) of the statutes is created to read:
SB100,7,11
1227.24 (3m) Review by the small business regulatory review board. On the
2same day that the agency files a rule under sub. (3) that may have a significant
3economic impact on small businesses, as defined in s. 227.114 (1), the agency shall
4submit a copy of the rule to the small business regulatory review board. The board
5may use cost-benefit analysis to determine the fiscal effect of the emergency rule on
6small businesses and shall determine whether the agency complied with s. 227.114
7or 227.19 (3) (e). If the board determines that the agency failed to comply with s.
8227.114 or 227.19 (3) (e), the board shall notify the agency of that determination and
9ask the agency to comply with those provisions. In addition, the board may submit
10suggested changes in the proposed rule to the agency. The notification of
11noncompliance may include a request that the agency do any of the following:
SB100,7,1312 (a) Explain why the agency has not incorporated comments received from small
13businesses regarding the emergency rule.
SB100,7,1514 (b) Verify that the emergency rule does not conflict with, overlap, or duplicate
15other rules or federal regulations.
SB100, s. 13 16Section 13. 227.30 of the statutes is created to read:
SB100,7,23 17227.30 Review of administrative rules. (1) Each agency shall, during the
185-year period beginning on the effective date of this subsection .... [revisor inserts
19date], review the rules of the agency to determine whether any of those rules place
20an unnecessary burden on the ability of small businesses, as defined in s. 227.114 (1),
21to conduct their affairs. If an agency determines that a rule places an unnecessary
22burden on the ability of a small business to conduct its affairs, the agency shall repeal
23the rule or amend the rule to remove the unnecessary burden.
SB100,7,25 24(2) In reviewing a rule under this section, the agency shall consider all of the
25following:
SB100,8,1
1(a) The continued need for the rule.
SB100,8,32 (b) The nature of the complaints and comments received from the public
3regarding the rule.
SB100,8,44 (c) The complexity of the rule.
SB100,8,65 (d) The extent to which the rule overlaps, duplicates, or conflicts with federal
6regulations, other state rules, or local ordinances.
SB100,8,77 (e) The length of time since the rule has been evaluated.
SB100,8,98 (f) The degree to which technology, economic conditions, or other factors have
9changed in the subject area affected by the rule since the rule was promulgated.
SB100,8,15 10(3) The agency shall annually, on the first day of the 12th month beginning
11after the effective date of this subsection .... [revisor inserts date], for the 5-year
12period, submit a report to the legislature under s. 13.172 (2) describing the agency's
13review of its rules and any actions taken regarding those rules during the previous
14year. The agency shall send a copy of that report to the small business regulatory
15review board.
SB100, s. 14 16Section 14. 227.40 (2) (f) of the statutes is created to read:
SB100,8,1717 227.40 (2) (f) Proceedings under s. 227.114 (6m) or 227.14 (2t).
SB100, s. 15 18Section 15. 227.485 (2) (c) of the statutes is amended to read:
SB100,8,2219 227.485 (2) (c) "Small business" means a business entity, including its
20affiliates, which is independently owned and operated, and which employs fewer
21than 25 full-time employees or which has gross annual sales of less than $2,500,000
22$5,000,000.
SB100, s. 16 23Section 16. 814.245 (5) (a) 2. of the statutes is amended to read:
SB100,9,224 814.245 (5) (a) 2. Attorney or agent fees may not be awarded in excess of $75
25$150 per hour unless the court determines that an increase in the cost of living or a

1special factor, such as the limited availability of qualified attorneys or agents,
2justifies a higher fee.
SB100, s. 17 3Section 17. 895.59 of the statutes is created to read:
SB100,9,5 4895.59 Liability exemption; disclosure of rule violations. (1) In this
5section:
SB100,9,66 (a) "Agency" has the meaning given in s. 227.01 (1).
SB100,9,77 (b) "Small business" has the meaning given in s. 227.114 (1).
SB100,9,11 8(2) A small business that voluntarily discloses information to the appropriate
9agency about an actual or potential violation of an administrative rule shall be
10immune from the imposition of a civil or criminal penalty that could be imposed for
11the violation if all of the following apply.
SB100,9,1312 (a) The voluntary disclosure is made within 45 days after the small business
13knew that an actual or potential violation occurred.
SB100,9,1714 (b) The small business making the disclosure initiates an appropriate and good
15faith effort to achieve compliance with the administrative rule, pursues compliance
16with due diligence and promptly corrects the noncompliance after discovery of the
17violation.
SB100,9,1918 (c) The small business cooperates with any reasonable request by the agency
19in any investigation that results from the disclosure.
SB100,9,21 20(3) A penalty may be imposed for the violation of an administrative rule
21notwithstanding sub. (2) if any of the following applies:
SB100,9,2322 (a) The violation resulted in serious harm or in imminent and substantial
23endangerment to public health, safety, or welfare.
SB100,9,2524 (b) The violation resulted in a substantial economic benefit that gave the
25violator a clear advantage over its business competitors.
Loading...
Loading...