BILL ANALYSIS C.S.H.B. 723 By: Turner 5-5-95 Committee Report (Substituted) BACKGROUND After the Legislature passes a law giving a state agency rule-making authority, the implementation of that legislation is left entirely up to the governing state agency. The potential is present for a state agency to not follow the original legislative intent. New agency rules can conflict with existing law or the directives set by the legislature. PURPOSE H.B. 723 requires that before adoption of an agency rule, the legislative committee with oversight of that agency must hold a public hearing on the agency rule. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not grant any additional rulemaking authority to a state officer, institution, or agency. SECTION BY SECTION ANALYSIS SECTION 1. Adding Section 2001.0321 INDEPENDENT REVIEW OF RULES; SUSPENSION OF RULE BY GOVERNOR: a) The Chair of any standing committee of either house may petition the presiding officer of either house to initiate a independent review by the appropriate committee of a rule proposed or adopted by a state agency. The presiding officer must notify the chair whether the petition will be reviewed within 10 days. (b) The standing committee may review any proposed or adopted rule referred to it, as long as the rule has not be in effect for more than 180 days at the time of the petition. The committee may hold a public hearing or a meeting on the rule. Provides points to consider when reviewing. (c) A committee may vote to recommend to the presiding officer that the presiding officer request the governor to suspend the rule or proposed rule. (d) The committee may meet by telephone conference call to consider a rule or proposed rule under this section. Sets meeting notice specifications for such a meeting. (e) Instead of holding a meeting, the chair of the committee may notify the members of the referred rule and sent a ballot to the members. The chair shall give each member an opportunity to vote or participate in the balloting by mail or fax. (f) If the committee recommends that the presiding officer requests the governor to suspend the rule, the chair shall give written notice to the presiding officer of the appropriate house and the state agency that adopted or proposed the rule within ten days. (g) If a committee recommends that the presiding officer requests the governor to suspend the rule, the chair shall give written notice to every member of the legislature within 10 days. No later than 10 days after the date of the committee action, a member of the appropriate house may file a written statement of support or objection with the committee action. (h) No later than 10 days after the presiding officer receives notice that a committee has recommended that the presiding officer request the governor to suspend a rule, the presiding officer may do so. The presiding officer shall consider any objections or statements of support filed by members. If the presiding officer sends a request to the governor, the officer must send a copy of the request to the governor, the state agency that adopted or proposed the rule, the secretary of state, and the other presiding officer. (i) Upon receiving a request from the presiding office of either house, the governor may suspend a rule, except for an emergency rule. The governor shall consider the items listed in (b) and shall state the grounds for suspension of the rule and when the suspension takes effect. The suspension may not take effect within 30 days of the suspension. Within 5 days of the suspension, the governor shall deliver a certified copy of the suspension proclamation to the to the affected state agency, and file notice of proclamation with the secretary of state for publication in the Texas Register. (j) When a rule is suspended under this section, the state agency may not adopt or propose a rule containing the substance of the suspended rule for at least 2 years, unless the governor consents by proclamation. SECTION 2. Amends Subchapter B, Chapter 2001, Government Code, by adding Section 2001.0322, AGENCY RULES REVIEW ADVISORY COMMITTEE. Establishes the agency rules review advisory committee which is composed of the following members or their designees: the governor; the lieutenant governor, the Speaker; the executive director of the Sunset Commission, and the executive director of Legislative Council. The committee shall consider possible approaches to legislative review of state agency rules and shall provide a report to the Legislature by November 1, 1996. The committee shall use existing staff and no appropriation shall be made for the work of the committee. This section expires August 31, 1997. SECTION 3. Repeals Section 2001.032, Government Code. SECTION 4. Emergency clause. Effective date: upon passage. COMPARISON OF ORIGINAL TO SUBSTITUTE The original bill required all proposed agency rules to be referred to the appropriate standing committees of the Legislature, and gave the committees the authority to recommend that the governor suspend the proposed rule. The substitute would allow the chair of any standing committee to petition the presiding officer to initiate an independent review by referring an adopted or proposed rule to the appropriate standing committee. The committee could than recommend to the presiding office that a rule be suspended, and the presiding officer could recommend to the governor that a rule be suspended. The substitute also establishes the agency rules review advisory committee which shall study approaches to legislative review of state agency rules and report to the Legislature. SUMMARY OF COMMITTEE ACTION Pursuant to posting of public notice on February 22, 1995, the House Committee on State Affairs convened in a public hearing on February 27, 1995 to consider HB 723. The Chair laid out HB 723 and recognized Rep. B. Turner and Rep. Yost to explain the bill. The following persons testified for the bill: Durwald Tucker representing the Texas Farm Bureau; and Ellis Gilleland representing himself. The following persons testified against the bill: Reggie James representing Consumers Union; Tom Smith representing Public Citizen; and Ruth Milburn representing Common Cause. The Chair recognized Rep. B. Turner to close on HB 723. The Chair referred HB 723 to a subcommittee consisting of the following members: Rep. S. Turner, Chair; Rep. D. Jones; Rep. Ramsay; Rep. Black, and Rep. Hochberg. HB 723 was considered by the committee in a formal meeting on March 23, 1995. The Chair laid out HB 723. HB 723 was left pending. After being recalled from subcommittee, the bill was considered by the committee in a formal meeting on April 27, 1995. The Chair laid out HB 723. The committee considered a complete substitute for the bill. The complete committee substitute was adopted without objection. The bill was reported favorably as substituted with the recommendation that it do pass and be printed by a record vote of 14 ayes, 1 nay, 0 pnv, 0 absent.