AB42: Bill Text

The bill

The bill makes various changes regarding the rule-making procedures established under current law. Significant changes regarding those procedures are described below.

Submission statements of scope to DOA

The bill requires scope statements for proposed rules to be submitted to DOA instead of to the governor. Following the submission, the bill requires DOA to make a determination as to the agency's authority to promulgate the proposed rule and report its determination to the governor, who may then approve or reject the statement of scope as under current law.

Preliminary public hearings and comment periods on scope statements

The bill requires an agency, following approval of a scope statement by the governor, to hold a preliminary public hearing and comment period on a scope statement if directed to do so by a cochairperson of JCRAR. Following such a directive, the agency must submit to the LRB a notice of the hearing and comment period to allow for public comment and feedback on the scope statement. The agency must hold the preliminary public hearing no sooner than the third day after publication of the notice in the register and submit all comments and feedback received to the agency head. A preliminary public hearing and comment period under the bill is in addition to the public hearing required under current law for certain rules.

Passage of bill required for certain rules

The bill provides that if an economic impact analysis, a revised economic impact analysis, or an independent economic impact analysis for a proposed rule indicates that $10 million or more in implementation and compliance costs are reasonably expected to be incurred by or passed along to businesses, local governmental units, and individuals over any two-year period as a result of the proposed rule, the agency proposing the rule must stop work on the proposed rule and may not continue to promulgate the rule except as follows:

1. The agency may resume the rule-making procedure for the proposed rule upon enactment of a bill that authorizes its promulgation.

2. The agency may modify the proposed rule to address the implementation and compliance costs of the proposed rule. If a revised economic impact analysis prepared by an agency and any independent economic impact analysis prepared following the modification all indicate that $10 million or more in implementation and compliance costs are not reasonably expected to be incurred by or passed along to businesses, local governmental units, and individuals over a two-year period as a result of the proposed rule, the agency may then resume the rule-making procedure for the proposed rule.

Independent economic impact analyses

The bill allows a cochairperson of JCRAR, after an agency submits a copy of an economic impact analysis for a proposed rule to the legislature, but before the proposed rule is submitted to DOA for review and final approval by the governor, to request that an independent economic impact analysis be prepared for the proposed rule. In that case, the cochairperson must contract for the preparation of the independent economic impact analysis. The person preparing the independent economic impact analysis must complete the independent economic impact analysis within 60 days and must include most of the same information and analysis that is required for an economic impact analysis prepared by an agency. If an independent economic impact analysis is requested for a proposed rule, an agency may not submit the proposed rule to DOA for final review until the agency receives the completed independent economic impact analysis. Upon completion of an independent economic impact analysis, the person preparing the analysis may submit a request to JCRAR for reimbursement of its actual and necessary costs of completing the analysis. The bill specifies circumstances under which either the agency or the legislature must pay the costs of the independent economic impact analysis.

In addition, the bill allows JCRAR, when a proposed rule is before JCRAR for final review, to request an independent economic impact analysis for the proposed rule. If JCRAR requests an independent economic impact analysis at that time, the analysis must similarly be completed within 60 days and JCRAR's review period is extended to the tenth working day following receipt by JCRAR of the completed analysis.

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:

AB42,1 Section 1. 20.765 (1) (kt) of the statutes is created to read:

AB42,4,5 20.765 (1) (kt) Independent economic analyses for administrative rules. All moneys received from agencies under s. 227.137 (4m) (b) 2. a. to reimburse persons for conducting independent economic impact analyses under ss. 227.137 (4m) and 227.19 (5) (b) 3.

AB42,2 Section 2 . 35.93 (2) (b) 3. bm. of the statutes is created to read:

AB42,4,8 35.93 (2) (b) 3. bm. Notices of preliminary public hearings and comment periods under s. 227.136.

AB42,3 Section 3. 227.12 (4) of the statutes is amended to read:

AB42,5,15 227.12 (4) If a petition to the department of revenue establishes that the department has established a standard by which it is construing a state tax statute, but has not promulgated a rule to adopt the standard or published the standard in a manner that is available to the public, the department shall, as provided under s. 227.135, submit a statement of the scope of the proposed rule to the governor department of administration no later than 90 days after receiving the petition. No later than 270 days after the statement is approved by the governor, the department shall submit the proposed rule in final draft form to the governor for the governor's approval, as provided under s. 227.185. At the department's request, the governor or the department of administration may, at any time prior to the expiration of any deadline specified in this subsection, extend the time for submitting the statement or proposed rule in draft form for any period not to exceed 60 days. The governor or the department of administration may grant more than one extension under this subsection, but the total period for all such extensions may not exceed 120 days. The rule need not adhere to the standard established by the department, but shall address the same circumstances as the standard addresses. If the department fails to comply with this subsection, any of the petitioners may commence an action in circuit court to compel the department's compliance. If an action is commenced under this subsection, the court may compel the department to provide information to the court related to the degree to which the department is enforcing the standard, except that the information provided by the department shall not disclose the identity of any person who is not a party to the action.

AB42,4 Section 4. 227.135 (2) of the statutes is amended to read:

AB42,6,12 227.135 (2) An agency that has prepared a statement of the scope of the proposed rule shall present the statement to the governor and to the individual or body with policy-making powers over the subject matter of the proposed rule for approval department of administration, which shall make a determination as to the agency's authority to promulgate the rule as proposed in the statement of scope and shall report the statement of scope and its determination to the governor who, in his or her discretion, may approve or reject the statement of scope. The agency may not send the statement to the legislative reference bureau for publication under sub. (3) until the governor issues a written notice of approval of the statement. The agency shall also present the statement to the individual or body with policy-making powers over the subject matter of the proposed rule for approval. The individual or body with policy-making powers may not approve the statement until at least 10 days after publication of the statement under sub. (3) and, if a preliminary public hearing and comment period are held by the agency under s. 227.136, until the individual or body has received and reviewed any public comments and feedback received from the agency under s. 227.136 (5). No state employee or official may perform any activity in connection with the drafting of a proposed rule, except for an activity necessary to prepare the statement of the scope of the proposed rule or an activity necessary to draft a corresponding emergency rule under s. 227.24, until the governor and the individual or body with policy-making powers over the subject matter of the proposed rule approve the statement.

AB42,5 Section 5. 227.135 (3) of the statutes is amended to read:

AB42,7,2 227.135 (3) If the governor approves a statement of the scope of a proposed rule under sub. (2), the agency shall send an electronic copy of the statement to the legislative reference bureau, in a format approved by the legislative reference bureau, for publication in the register. On the same day that the agency sends the statement to the legislative reference bureau, the agency shall send a copy of the statement to the secretary of administration and to the chief clerks of each house of the legislature, who shall distribute the statement to the cochairpersons of the joint committee for review of administrative rules. The agency shall include with any statement of scope sent to the legislative reference bureau the date of the governor's approval of the statement of scope. The legislative reference bureau shall assign a discrete identifying number to each statement of scope and shall include that number and the date of the governor's approval in the publication of the statement of scope in the register.

AB42,6 Section 6. 227.136 of the statutes is created to read:

AB42,7,9 227.136 Preliminary public hearing and comment period. (1) Within 10 days after publication of a statement of the scope of a proposed rule under s. 227.135 (3), either cochairperson of the joint committee for the review of administrative rules may submit a written directive to the agency that prepared the statement for the agency to hold a preliminary public hearing and comment period on the statement of scope as provided in this section.

AB42,7,19 (2) If the agency is directed to hold a preliminary public hearing and comment period on a statement of scope as provided in sub. (1) or if the agency otherwise opts to do so on its own initiative, the agency shall submit to the legislative reference bureau, in a format approved by the legislative reference bureau, a notice of a preliminary public hearing and comment period to allow for public comment and feedback on the statement of scope. The agency may also take any other action it considers necessary to provide notice of the preliminary public hearing and comment period to other interested persons. The notice shall be approved by the individual or body with policy-making powers over the subject matter of the proposed rule and shall include all of the following:

AB42,7,20 (a) A statement of the date, time, and place of the preliminary public hearing.

AB42,7,22 (b) The place where comments on the statement of scope should be submitted and the deadline for submitting those comments.

AB42,7,25 (3) The agency shall hold the preliminary public hearing and comment period in accordance with the notice required under sub. (2), but may not hold the hearing sooner than the 3rd day after publication of the notice in the register.

AB42,8,2 (4) The agency shall conduct a hearing under this section in accordance with s. 227.18.

AB42,8,6 (5) The agency shall report all public comments and feedback on the statement of scope of the proposed rule that the agency receives at the preliminary public hearing and comment period to the individual or body with policy-making powers over the subject matter of the proposed rule.

AB42,8,9 (6) Failure of any person to receive notice of a preliminary public hearing as provided in this section is not grounds for invalidating any resulting rule if notice of the hearing was published in the register in accordance with s. 35.93 (2) (b) 3. bm.

AB42,7 Section 7 . 227.137 (3) (intro.) and (a) of the statutes are amended to read:

AB42,8,22 227.137 (3) (intro.) An economic impact analysis of a proposed rule shall contain information on the economic effect of the proposed rule on specific businesses, business sectors, public utility ratepayers, local governmental units, and the state's economy as a whole. When The agency or person preparing the analysis, the agency shall solicit information and advice from businesses, associations representing businesses, local governmental units, and individuals that may be affected by the proposed rule. The agency or person shall prepare the economic impact analysis in coordination with local governmental units that may be affected by the proposed rule. The agency or person may also request information that is reasonably necessary for the preparation of an economic impact analysis from other businesses, associations, local governmental units, and individuals and from other agencies. The economic impact analysis shall include all of the following:

AB42,9,4 (a) An analysis and quantification of the policy problem that the proposed rule is intending to address, including comparisons with the approaches used by the federal government and by Illinois, Iowa, Michigan, and Minnesota to address that policy problem and, if. If the approach chosen by the agency to address that policy problem is different from those approaches, an economic impact analysis prepared by an agency shall include a statement as to why the agency chose a different approach.

AB42,8 Section 8. 227.137 (3) (b) of the statutes is renumbered 227.137 (3) (b) (intro.) and amended to read:

AB42,9,11 227.137 (3) (b) (intro.) An analysis and detailed quantification of the economic impact of the proposed rule, including the implementation and compliance costs that are reasonably expected to be incurred by or passed along to the businesses, local governmental units, and individuals that may be affected by the proposed rule., specifically including all of the following:

AB42,9 Section 9. 227.137 (3) (b) 1. and 2. of the statutes are created to read:

AB42,9,19 227.137 (3) (b) 1. An estimate of the total implementation and compliance costs that are reasonably expected to be incurred by or passed along to businesses, local governmental units, and individuals as a result of the proposed rule, expressed as a single dollar figure. With respect to an independent economic impact analysis prepared under sub. (4m) or s. 227.19 (5) (b) 3., the person preparing the analysis shall provide a detailed explanation of any variance from the agency's estimate under this subdivision.

AB42,9,24 2. A determination, for purposes of the requirement under s. 227.139, as to whether $10,000,000 or more in implementation and compliance costs are reasonably expected to be incurred by or passed along to businesses, local governmental units, and individuals over any 2-year period as a result of the proposed rule.

AB42,10 Section 10 . 227.137 (4m) of the statutes is created to read:

AB42,10,5 227.137 (4m) (a) After an agency submits an economic impact analysis for a proposed rule to the legislature under sub. (4), but before the agency submits the proposed rule for approval under s. 227.185, either cochairperson of the joint committee for review of administrative rules may request an independent economic impact analysis to be prepared for the proposed rule.

AB42,10,9 (b) 1. If a cochairperson of the joint committee for review of administrative rules requests an independent economic impact analysis under par. (a), the cochairperson shall notify the agency proposing the proposed rule and shall contract with a person that is not an agency to prepare the independent economic impact analysis.

AB42,10,14 2. Upon completion of an independent economic impact analysis requested by a cochairperson of the joint committee for review of adminstrative rules, the person preparing the analysis may submit a request to the committee for reimbursement of its actual and necessary costs of completing the analysis. Costs of completing the independent economic impact analysis shall be paid as follows:

AB42,10,22 a. If the estimate in the independent economic impact analysis of total implementation and compliance costs under sub. (3) (b) 1. varies from the agency's estimate by 15 percent or more or varies from the agency's determination that there will be no implementation or compliance costs, the committee shall assess the agency that is proposing the proposed rule for those costs. The committee shall credit all moneys received under this subd. 2. a. to the appropriation account under s. 20.765 (1) (kt) and shall reimburse the person from the appropriation account under s. 20.765 (1) (kt).

AB42,11,3 b. If the estimate in the independent economic impact analysis of total implementation and compliance costs under sub. (3) (b) 1. does not vary from the agency's estimate by 15 percent or more or is in accord with the agency's determination that there will be no implementation and compliance costs, the committee shall reimburse the person in equal parts from the appropriation accounts under s. 20.765 (1) (a) and (b).

AB42,11,5 (c) A person preparing an independent economic impact analysis under par. (b) shall do all of the following:

AB42,11,6 1. Include in the analysis the information that is required under sub. (3).

AB42,11,12 2. Upon completion of the analysis, submit the analysis to the agency, to the department of administration, to the governor, and to the chief clerks of each house of the legislature, who shall distribute the analysis to the presiding officers of their respective houses, to the chairpersons of the appropriate standing committees of their respective houses, as designated by those presiding officers, and to the cochairpersons of the joint committee for review of administrative rules.

AB42,11,14 3. Complete the independent economic impact analysis within 60 days after contracting to prepare the analysis.

AB42,11,17 (d) When an independent economic impact analysis is requested under par. (a), the agency may not submit the proposed rule for approval under s. 227.185 until the agency receives the completed independent economic impact analysis.

AB42,11 Section 11 . 227.137 (6) and (7) of the statutes are repealed.

AB42,12 Section 12 . 227.139 of the statutes is created to read:

AB42,12,4 227.139 Passage of bill required for certain rules. (1) If an economic impact analysis prepared under s. 227.137 (2), a revised economic impact analysis prepared under s. 227.137 (4), or an independent economic impact analysis prepared under s. 227.137 (4m) or 227.19 (5) (b) 3. indicates that $10,000,000 or more in implementation and compliance costs are reasonably expected to be incurred by or passed along to businesses, local governmental units, and individuals over any 2-year period as a result of the proposed rule, the agency proposing the rule shall stop work on the proposed rule and may not continue promulgating the proposed rule notwithstanding any provision authorizing or requiring the agency to promulgate the proposed rule, except as authorized under sub. (2).

AB42,12,8 (2) (a) Any member of the legislature may introduce a bill authorizing an agency to promulgate a rule that the agency is prohibited from promulgating under sub. (1). The agency may resume the rule-making process as provided in this subchapter upon enactment of a bill introduced under this paragraph.

AB42,12,21 (b) If an agency is prohibited from promulgating a rule under sub. (1), the agency may modify the proposed rule, if the modification is germane to the subject matter of the proposed rule, to address the implementation and compliance costs of the proposed rule. If the agency modifies a proposed rule under this paragraph, the agency shall prepare a revised economic impact analysis under s. 227.137 (4). Following the modification, the agency may continue with the rule-making process as provided in this subchapter if the revised economic impact analysis prepared by the agency indicates, and any independent economic impact analysis prepared under s. 227.137 (4m) or 227.19 (5) (b) 3. subsequent to the agency's modification also indicates, that $10,000,000 or more in implementation and compliance costs are not reasonably expected to be incurred by or passed along to businesses, local governmental units, and individuals over any 2-year period as a result of the proposed rule.

AB42,12,22 (3) This section does not apply to rules promulgated under s. 227.24.

AB42,13 Section 13. 227.14 (2) (a) 3m. of the statutes is created to read:

AB42,13,3 227.14 (2) (a) 3m. A summary of any public comments and feedback on the statement of scope of the proposed rule that the agency received at any preliminary public hearing and comment period held under s. 227.136 and a description of how and to what extent the agency took those comments and that feedback into account in drafting the proposed rule.

AB42,14 Section 14. 227.14 (4m) of the statutes is amended to read:

AB42,13,23 227.14 (4m) Notice of submittal to legislative council staff. On the same day that an agency submits a proposed rule to the legislative council staff under s. 227.15, the agency shall prepare a written notice of the agency's submittal to the legislative council staff. The notice shall include a statement of the date on which the proposed rule has been submitted to the legislative council staff for review, of the subject matter of the proposed rule, and of whether a public hearing on the proposed rule is required under s. 227.16, and shall identify the organizational unit within the agency that is primarily responsible for the promulgation of the rule. The notice shall also include a statement containing the identifying number of the statement of scope for the proposed rule assigned under s. 227.135 (3), the date of publication and issue number of the register in which the statement of scope is published, and the date of approval of the statement of scope by the individual or body with policy-making powers over the subject matter of the proposed rule under s. 227.135 (2). The notice shall be approved by the individual or body with policy-making powers over the subject matter of the proposed rule. The agency shall send an electronic copy of the notice to the legislative reference bureau, in a format approved by the legislative reference bureau, for publication in the register. On the same day that the agency sends the notice to the legislative reference bureau, the agency shall send a copy of the notice to the secretary of administration.

AB42,15 Section 15 . 227.15 (1) of the statutes is amended to read:

AB42,14,13 227.15 (1) Submittal to legislative council staff. Prior to a public hearing on a proposed rule required under s. 227.16 or, if no such public hearing is required, prior to notice under s. 227.19, an agency shall submit the proposed rule to the legislative council staff for review. The proposed rule shall be in the form required under s. 227.14 (1), and shall include the material required under s. 227.14 (2), (3), and (4), the economic impact analysis required under s. 227.137 (2), and any revised economic impact analysis required under s. 227.137 (4). An agency may not hold a public hearing on a proposed rule or give notice under s. 227.19 until after it has received a written report of the legislative council staff review of the proposed rule or until after the initial review period of 20 working days under sub. (2) (intro.), whichever comes first. An agency may give notice of a public hearing prior to receipt of the legislative council staff report. This subsection does not apply to rules promulgated under s. 227.24.

AB42,16 Section 16 . 227.15 (1m) (bm) of the statutes is amended to read:

AB42,14,17 227.15 (1m) (bm) The economic impact analysis required under s. 227.137 (2) and, any revised economic impact analysis required under s. 227.137 (4), and any independent economic impact analysis prepared under s. 227.137 (4m).

AB42,17 Section 17. 227.16 (1) of the statutes is amended to read:

AB42,14,22 227.16 (1) Except as provided under sub. (2) In addition to any preliminary public hearing and comment period held under s. 227.136, all rule making by an agency shall be preceded by notice and public hearing as provided in ss. 227.17 and 227.18, except as provided in sub. (2).

AB42,18 Section 18. 227.16 (6) of the statutes is renumbered 227.136 (7) and amended to read:

AB42,15,7 227.136 (7) For the purpose of soliciting public comment, an agency may hold a hearing on the general subject matter of possible or anticipated rules before preparing a statement of scope for a proposed rule in draft form. A hearing held under this subsection does not satisfy the requirement of sub. (1) with respect to the promulgation of a specific proposed rule relieve the agency from its obligation to comply with a directive under sub. (1) or the requirement to hold a hearing under s. 227.16.

AB42,19 Section 19. 227.17 (1) (intro.) of the statutes is amended to read:

AB42,15,10 227.17 (1) (intro.) If a hearing is required under s. 227.16, the agency shall do all of the following:

AB42,20 Section 20 . 227.17 (3) (eg) of the statutes is created to read:

AB42,15,13 227.17 (3) (eg) Any independent economic impact analysis prepared under s. 227.137 (4m).

AB42,21 Section 21. 227.17 (3) (em) of the statutes is repealed.

AB42,22 Section 22 . 227.185 of the statutes is amended to read:

AB42,15,23 227.185 Approval by governor. After a proposed rule is in final draft form, the agency shall submit the proposed rule to the governor for approval. The governor, in his or her discretion, may approve or reject the proposed rule. If the governor approves a proposed rule, the governor shall provide the agency with a written notice of that approval. No proposed rule may be submitted to the legislature for review under s. 227.19 (2) unless the governor has approved the proposed rule in writing. The agency shall notify the joint committee for review of administrative rules whenever it submits a proposed rule for approval under this section.

AB42,23 Section 23 . 227.19 (3) (intro.) of the statutes is amended to read:

AB42,16,11 227.19 (3) Form of report. (intro.) The report required under sub. (2) shall be in writing and shall include the proposed rule in the form specified in s. 227.14 (1); the material specified in s. 227.14 (2), (3), and (4); including any statement, suggested changes, or other material submitted to the agency by the small business regulatory review board; a copy of any economic impact analysis prepared by the agency under s. 227.137 (2); a copy of any revised economic impact analysis prepared by the agency under s. 227.137 (4); a copy of any report prepared by the department of administration under s. 227.137 (6); independent economic impact analysis prepared under s. 227.137 (4m); a copy of any energy impact report received from the public service commission under s. 227.117 (2); and a copy of any recommendations of the legislative council staff. The report shall also include all of the following:

AB42,24 Section 24. 227.19 (3) (c) of the statutes is amended to read:

AB42,16,14 227.19 (3) (c) A list of the persons who appeared or registered for or against the proposed rule at a public hearing held under s. 227.136 or 227.16.

AB42,25 Section 25 . 227.19 (4) (b) 1. (intro.) of the statutes is amended to read:

AB42,16,22 227.19 (4) (b) 1. (intro.) Except as otherwise provided under subds. 1m. and 5. in this paragraph, the committee review period for each committee extends for 30 days after referral of the proposed rule to the committee under sub. (2). If the chairperson or the cochairpersons of a committee take either of the following actions within the 30-day period, the committee review period for that committee is continued for 30 days from the date on which the first 30-day review period would have expired:

AB42,26 Section 26 . 227.19 (5) (b) 1. (intro.) of the statutes is amended to read:

AB42,17,11 227.19 (5) (b) 1. (intro.) Except as otherwise provided in subd. 1m. this paragraph, the review period for the joint committee for review of administrative rules extends for 30 days after the last referral of a proposed rule and any objection to that committee, and during that review period that committee may take any action on the proposed rule in whole or in part permitted under this subsection. The joint committee for review of administrative rules shall meet and take action in executive session during that period with respect to any proposed rule or any part of a proposed rule to which a committee has objected and may meet and take action in executive session during that period with respect to any proposed rule or any part of a proposed rule to which no committee has objected, except that if the cochairpersons take either of the following actions within the 30-day period, the joint committee review period is continued for 30 days from the date on which the first 30-day review period would have expired:

AB42,27 Section 27 . 227.19 (5) (b) 3. of the statutes is created to read: