Relates to review of existing rules

Summary of provisions

Bill § 1 amends §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 § 207(1) to provide that the initial review period for a rule, currently fixed at S 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. For any rule that imposes an adverse impact or paperwork or compliance requirements on small businesses, local governments or rural areas, the default period for initial review would be after 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 website shall 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, rural area flexibility analysis or a job impact statement 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 SAPA § 202-b(6) or § 202-bb(7).

Bill § 4 continues previously-enacted statutory provisions to authorize electronic publication of regulatory agendas for another four years.

Summary of amendments

The bill was first amended to (1) require a regulatory agenda to include an e-mail 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 than the default period (third year after rule adoption), such period cannot exceed the otherwise-applicable five-year limit; and (3) make other technical and clarifying changes.

A second round of amendments required agencies to publish their regulatory agendas and rule review lists on their websites, clarified the schedule for rule reviews, and made other changes for clarity and to minimize any impositions on agency workloads.

Effects of present law which this bill would alter

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 and participation in this process. 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 apparent. 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 entities, 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 participation 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 of 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 Massachusetts (4 years), while ending the requirement for a "one-size-fits-all" schedule.

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

The bill also extends the provisions of SAP A 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.

Effective date

1st day of January after becoming law, provided that the new schedule for initial review of rules will apply to rules adopted on or after such date. The amended provisions of SAPA 202-d are continued only until December 31, 2016.