By:  Brown                                    S.B. No. 633

                                A BILL TO BE ENTITLED

                                       AN ACT

 1-1     relating to assessments performed before agency adoption of certain

 1-2     environmental rules.

 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-4           SECTION 1.  Chapter 2001, Government Code, is amended by

 1-5     adding Section 2001.0225 to read as follows:

 1-6           Sec. 2001.0225.  REGULATORY ANALYSIS OF MAJOR ENVIRONMENTAL

 1-7     RULES.  (a)  This section applies only to a major environmental

 1-8     rule adopted by a state agency, the result of which is to:

 1-9                 (1)  exceed a standard set by federal law, unless the

1-10     rule is specifically required by state law;

1-11                 (2)  exceed an express requirement of state law, unless

1-12     the rule is specifically required by federal law;

1-13                 (3)  exceed a requirement of a delegation agreement or

1-14     contract between the state and an agency or representative of the

1-15     federal government to implement a state and federal program; or

1-16                 (4)  adopt a rule solely under the general powers of

1-17     the agency instead of under a specific state law.

1-18           (b)  Before adopting a major environmental rule subject to

1-19     this section, a state agency shall conduct a regulatory analysis

1-20     that:

1-21                 (1)  identifies the problem the rule is intended to

1-22     address;

1-23                 (2)  determines whether a new rule is necessary to

 2-1     address the problem; and

 2-2                 (3)  considers the benefits and costs of the proposed

 2-3     rule in relationship to state agencies, local governments, the

 2-4     public, the regulated community, and the environment.

 2-5           (c)  When giving notice of a major environmental rule subject

 2-6     to this section, a state agency shall incorporate into the fiscal

 2-7     note required by Section 2001.024 a draft impact analysis

 2-8     describing the anticipated effects of the proposed rule.  The draft

 2-9     impact analysis, at a minimum, must:

2-10                 (1)  identify the benefits that the agency anticipates

2-11     from adoption and implementation of the rule, including reduced

2-12     risks to human health, safety, or the environment;

2-13                 (2)  identify the costs that the agency anticipates

2-14     state agencies, local governments, the public, and the regulated

2-15     community will experience after implementation of the rule;

2-16                 (3)  describe the benefits and costs anticipated from

2-17     implementation of the rule in as quantitative a manner as feasible,

2-18     but including a qualitative description when a quantitative

2-19     description is not feasible or adequately descriptive;

2-20                 (4)  describe reasonable alternative methods for

2-21     achieving the purpose of the rule that were considered by the

2-22     agency and provide the reasons for rejecting those alternatives in

2-23     favor of the proposed rule;

2-24                 (5)  identify the data and methodology used in

2-25     performing the analysis required by this section;

 3-1                 (6)  provide an explanation of whether the proposed

 3-2     rule specifies a single method of compliance, and, if so, explain

 3-3     why the agency determines that a specified method of compliance is

 3-4     preferable to adopting a flexible regulatory approach, such as a

 3-5     performance-oriented, voluntary, or market-based approach;

 3-6                 (7)  state that there is an opportunity for public

 3-7     comment on the draft impact analysis under Section 2001.029 and

 3-8     that all comments will be addressed in the publication of the final

 3-9     regulatory analysis; and

3-10                 (8)  provide information in such a manner that a

3-11     reasonable person reading the analysis would be able to identify

3-12     the impacts of the proposed rule.

3-13           (d)  After considering public comments submitted under

3-14     Section 2001.029 and determining that a proposed rule should be

3-15     adopted, the agency shall prepare a final regulatory analysis that

3-16     complies with Section 2001.033.  Additionally, the agency shall

3-17     find that, compared to the alternative proposals considered and

3-18     rejected, the rule will result in the best combination of

3-19     effectiveness in obtaining the desired results and of economic

3-20     costs not materially greater than the costs of any alternative

3-21     regulatory method considered.

3-22           (e)  In preparing the draft impact analysis before

3-23     publication for comment and the final regulatory analysis for the

3-24     agency order adopting the rule, the state agency shall consider

3-25     that the purpose of this requirement is to identify for the public

 4-1     and the regulated community the information that was considered by

 4-2     the agency, the information that the agency determined to be

 4-3     relevant and reliable, and the assumptions and facts upon which the

 4-4     agency made its regulatory decision.  In making its final

 4-5     regulatory decision, the agency shall assess:

 4-6                 (1)  all information submitted to it, whether

 4-7     quantitative or qualitative, consistent with generally accepted

 4-8     scientific standards;

 4-9                 (2)  actual data where possible; and

4-10                 (3)  assumptions that reflect actual impacts that the

4-11     regulation is likely to impose.

4-12           (f)  A person who submitted public comment in accordance with

4-13     Section 2001.029 may challenge the validity of a major

4-14     environmental rule that is not proposed and adopted in accordance

4-15     with the procedural requirements of this section by filing an

4-16     action for declaratory judgment under Section 2001.038 not later

4-17     than the 30th day after the effective date of the rule.  If a court

4-18     determines that a major environmental rule was not proposed and

4-19     adopted in accordance with the procedural requirements of this

4-20     section, the rule is invalid.

4-21           (g)  In this section:

4-22                 (1)  "Benefit" means a reasonably identifiable,

4-23     significant, direct or indirect, favorable effect, including a

4-24     quantifiable or nonquantifiable environmental, health, or economic

4-25     effect, that is expected to result from implementation of a rule.

 5-1                 (2)  "Cost" means a reasonably identifiable,

 5-2     significant, direct or indirect, adverse effect, including a

 5-3     quantifiable or nonquantifiable environmental, health, or economic

 5-4     effect, that is expected to result from implementation of a rule.

 5-5                 (3)  "Major environmental rule" means a rule the

 5-6     specific intent of which is to protect the environment or reduce

 5-7     risks to human health from environmental exposure and that may

 5-8     adversely affect in a material way the economy, a sector of the

 5-9     economy, productivity, competition, jobs, the environment, or the

5-10     public health and safety of the state.

5-11           (h)  The requirements of this section do not apply to state

5-12     agency rules that are proposed or adopted on an emergency basis to

5-13     protect the environment or to reduce risks to human health from

5-14     environmental exposure.

5-15           SECTION 2.  This Act takes effect September 1, 1997, and

5-16     applies only to a major environmental rule, as defined by Section

5-17     2001.0225, Government Code, as added by this Act, that is proposed

5-18     by a state agency on or after that date.

5-19           SECTION 3.  The importance of this legislation and the

5-20     crowded condition of the calendars in both houses create an

5-21     emergency and an imperative public necessity that the

5-22     constitutional rule requiring bills to be read on three several

5-23     days in each house be suspended, and this rule is hereby suspended.