Senate Bill S6440

                                BILL NUMBER:S6440A

TITLE OF BILL:
An act to amend the state administrative procedure act, in relation to
continuing improvements to agency regulatory agendas and providing more
effective review of existing rules; and to amend chapter 402 of the laws
of 1994, amending the state administrative procedure act relating to
requiring certain agencies to submit regulatory agendas for publication
in the state register, in relation to extending the expiration of
certain provisions of such chapter

PURPOSE:
This bill would continue for four more years the improvements made to
agency regulatory agendas, improve the effectiveness of the current
"5-year review" process by providing for more better outreach and more
timely initial review of rules that impact small businesses and local
governments, and improve agency performance by highlighting cases of
non-compliance.

SUMMARY OF PROVISIONS:
Bill § 1 amends section 202-d of the State Administrative Procedure Act
(SAPA) to update the reference to the Department of Financial Services,
which has replaced the former Departments of Banking and Insurance.

Bill §2 amends SAPA section 207(1) to provide that the initial review
period for a rule, currently fixed at 5 years for every rule, could be
              

accelerated by the agency so that the impact of new regulatory
provisions could be evaluated on a more timely and appropriate schedule.
The maximum period for initial review would be after 5 years, A rule
that imposes and adverse impact or paperwork or compliance requirements
on small businesses, local governments or rural areas, the default peri-
od for initial review would be 2 years, but the agency could propose a
different initial period for such review and invite comment on its
justification.

Bill §3 amends SAPA §207(2) to provide that an agency that publishes its
regulatory agenda on its website shall also include the list of rules
that must be reviewed in the current year. Any listed rule that
originally required the preparation of a regulatory flexibility analysis
and/or a rural area flexibility analysis shall be identified and the
agency shall provide outreach as appropriate to potentially affected
small businesses, local governments and public and private interests in
rural areas that the rule is being reviewed. Such outreach may include
solicitation of input through online or other electronic means or
through the activities listed in SAP A §202-b(6) or §202-bb(7).

Bill §4 adds a new SAPP §207(6) providing that, beginning with the first
issue in September, the Secretary of State will publish in the State
Register on a weekly basis a delinquent list of agencies that have not
commenced a required review of rules for that year.

Bill §5 continues previously-enacted statutory provisions to authorize
electronic publication of regulatory agendas for another four years.

SUMMARY OF AMENDMENTS:
The bill is amended to (1) require a regulatory agenda to include an
email address for contacting the designated agency representative (this
provision is currently optional); (2) clarify that if an agency selects
an initial review period for a rule impacting small businesses or local
governments different that the default period (two years after rule
adoption), such period cannot exceed the otherwise-applicable five-year
limit; (3) clarify that an agency will be included on the delinquent
list if it fails to submit a list of rules that must be reviewed pursu-
ant to §207; and (4) make other technical and clarifying changes.

EXISTING LAW:
The current timeframe for initial review of newly-adopted regulatory
provisions is after 5 years.  There are currently no requirements in the
regulatory agenda process for online posting of 5-year review lists, or
for outreach to affected small businesses, local governments, or rural
interests to promote their awareness of participation in this process,
and agencies that do not comply with SAPA §207 are not publicly identi-
fied. In addition, the bill continues present law relating to electronic
publication of regulatory agendas for another four years.

JUSTIFICATION:
One common complaint about rulemaking is that, once adopted, regulations
tend to remain on the books forever without any further review. In order
to prevent the rules on its books from becoming stale and outdated, New
York State enacted legislation in 1996 to establish a "5-year review"
cycle for substantive rules. Agencies are required to list the rules
they adopted five years ago, and thereafter to re-review these rules
every five years, stating their intentions to modify them or their
justification for retaining them unchanged. The public is invited to
comment on the continued need for the rules.

Over time, some shortcomings in the SAPA .207 process have become appar-
ent. For example, the mandatory timeframe for an initial review of rules
that adversely impact small businesses is, in many cases, too untimely.
If the costs and burdens of a new rule exceed the agency's estimates,
many small businesses may not survive until the rule is initially
reviewed five years down the road. This bill recognizes that accelerated
review may be appropriate for specific rules and makes provisions for
scheduling initial reviews for periods of less than 5 years.

For rules impacting small businesses, local governments or rural enti-
ties, the default period for initial review would be after 2 years
(which could be varied by the agency with justification), and agencies
would be required to engage in outreach efforts to encourage partic-
ipation on the review by such affected parties. (similar outreach
provisions were added to SAPA §202-d, providing for publication of
prospective regulatory agendas, in 2008). The default period would
remain 5 years for other rules, but could also be adjusted by the agency

based on the specifics for the rule. This approach will allow New York
agencies to commence an initial review in less than 5 years, as is the
practice in other states like Florida and Hawaii (2 years) and Massachu-
setts (4 years), while ending the requirement for a "one-size-fits-all"
schedule.

In recent years there have been indications that agencies don't always
pay careful attention to the rule review process. For example, in 2008
the Assembly and Senate Co-Chairs of the Administrative Regulations
Review Commission wrote to three agencies concerning deficiencies in
their efforts. One agency announced that it was retaining it rules from
2003 - without first soliciting any public comment. A second agency
reviewed its rules from 2007, instead of 2003.  A third reviewed its
2003 adoptions but failed to review the rules it had originally adopted
in 1998, including several highly significant rules. More recently, one
agency in 2011 has finally commenced reviews of existing rules that it
should have conducted in 2008, 2009 and 2010. The publication of a list
of agencies that - after 2/3 of the year has passed - still have not
complied with §207 should provide an incentive for such agencies to
commence their required reviews.

This bill is needed to make SAPA review process more visible and effec-
tive, particularly to those parties that can he significantly banned by
the continuation of burdensome rules. The result should be improved
attention to ensuring that New York State's businesses and local govern-
ments are not held back by yesterday's regulations.

The bill also extends the provisions of SAPA authorizing the publication
of a continuously updated online regulatory agenda for another four
years. This will enable the State to provide more timely information and
effective outreach on rules under development as well as those under
review.

LEGISLATIVE HISTORY:
New bill.

LOCAL FISCAL IMPLICATIONS:
Savings will ultimately result from more effective efforts to eliminate
unneeded regulatory mandates on businesses and local governments in the
state.

EFFECTIVE DATE:
First day of January after becoming law, provided that the provisions of
SAPA §202-d are continued only until December 31, 2016.