1-1 By: Brown S.B. No. 633 1-2 (In the Senate - Filed February 18, 1997; February 20, 1997, 1-3 read first time and referred to Committee on Natural Resources; 1-4 February 27, 1997, reported favorably, as amended, by the following 1-5 vote: Yeas 7, Nays 2; February 27, 1997, sent to printer.) 1-6 COMMITTEE AMENDMENT NO. 1 By: Brown 1-7 Amend S.B. No. 633 in SECTION 1 of the bill, in proposed Section 1-8 2001.0225, Government Code, by striking the sentence beginning on 1-9 page 3, line 19 as follows: "The agency shall make every effort to 1-10 adopt rules that provide the maximum flexibility to the regulated 1-11 community in complying with the rule." 1-12 A BILL TO BE ENTITLED 1-13 AN ACT 1-14 relating to assessments performed before agency adoption of certain 1-15 environmental rules. 1-16 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-17 SECTION 1. Chapter 2001, Government Code, is amended by 1-18 adding Section 2001.0225 to read as follows: 1-19 Sec. 2001.0225. REGULATORY ANALYSIS OF MAJOR ENVIRONMENTAL 1-20 RULES. (a) This section applies only to a major environmental 1-21 rule adopted by a state agency, the result of which is to: 1-22 (1) exceed a standard set by federal law, unless the 1-23 rule is specifically required by state law; 1-24 (2) exceed an express requirement of state law, unless 1-25 the rule is specifically required by federal law; 1-26 (3) exceed a requirement of a delegation agreement or 1-27 contract between the state and an agency or representative of the 1-28 federal government to implement a state and federal program; or 1-29 (4) adopt a rule solely under the general powers of 1-30 the agency instead of under a specific state law. 1-31 (b) Before adopting a major environmental rule subject to 1-32 this section, a state agency shall conduct a regulatory analysis 1-33 that: 1-34 (1) identifies the problem the rule is intended to 1-35 address; 1-36 (2) determines whether a new rule is necessary to 1-37 address the problem; and 1-38 (3) considers the benefits and costs of the proposed 1-39 rule in relationship to state agencies, local governments, the 1-40 public, the regulated community, and the environment. 1-41 (c) When giving notice of a major environmental rule subject 1-42 to this section, a state agency shall incorporate into the fiscal 1-43 note required by Section 2001.024 a draft impact analysis 1-44 describing the anticipated effects of the proposed rule. The draft 1-45 impact analysis, at a minimum, must: 1-46 (1) identify the benefits that the agency anticipates 1-47 from adoption and implementation of the rule, including reduced 1-48 risks to human health, safety, or the environment; 1-49 (2) identify the costs that the agency anticipates 1-50 state agencies, local governments, the public, and the regulated 1-51 community will experience after implementation of the rule; 1-52 (3) describe the benefits and costs anticipated from 1-53 implementation of the rule in as quantitative a manner as feasible, 1-54 but including a qualitative description when a quantitative 1-55 description is not feasible or adequately descriptive; 1-56 (4) describe reasonable alternative methods for 1-57 achieving the purpose of the rule that were considered by the 1-58 agency and provide the reasons for rejecting those alternatives in 1-59 favor of the proposed rule; 1-60 (5) identify the data and methodology used in 1-61 performing the analysis required by this section; 1-62 (6) provide an explanation of whether the proposed 1-63 rule specifies a single method of compliance, and, if so, explain 2-1 why the agency determines that a specified method of compliance is 2-2 preferable to adopting a flexible regulatory approach, such as a 2-3 performance-oriented, voluntary, or market-based approach; 2-4 (7) state that there is an opportunity for public 2-5 comment on the draft impact analysis under Section 2001.029 and 2-6 that all comments will be addressed in the publication of the final 2-7 regulatory analysis; and 2-8 (8) provide information in such a manner that a 2-9 reasonable person reading the analysis would be able to identify 2-10 the impacts of the proposed rule. 2-11 (d) After considering public comments submitted under 2-12 Section 2001.029 and determining that a proposed rule should be 2-13 adopted, the agency shall prepare a final regulatory analysis that 2-14 complies with Section 2001.033. Additionally, the agency shall 2-15 find that, compared to the alternative proposals considered and 2-16 rejected, the rule will result in the best combination of 2-17 effectiveness in obtaining the desired results and of economic 2-18 costs not materially greater than the costs of any alternative 2-19 regulatory method considered. The agency shall make every effort 2-20 to adopt rules that provide the maximum flexibility to the 2-21 regulated community in complying with the rule. 2-22 (e) In preparing the draft impact analysis before 2-23 publication for comment and the final regulatory analysis for the 2-24 agency order adopting the rule, the state agency shall consider 2-25 that the purpose of this requirement is to identify for the public 2-26 and the regulated community the information that was considered by 2-27 the agency, the information that the agency determined to be 2-28 relevant and reliable, and the assumptions and facts upon which the 2-29 agency made its regulatory decision. In making its final 2-30 regulatory decision, the agency shall assess: 2-31 (1) all information submitted to it, whether 2-32 quantitative or qualitative, consistent with generally accepted 2-33 scientific standards; 2-34 (2) actual data where possible; and 2-35 (3) assumptions that reflect actual impacts that the 2-36 regulation is likely to impose. 2-37 (f) A person who submitted public comment in accordance with 2-38 Section 2001.029 may challenge the validity of a major 2-39 environmental rule that is not proposed and adopted in accordance 2-40 with the procedural requirements of this section by filing an 2-41 action for declaratory judgment under Section 2001.038 not later 2-42 than the 30th day after the effective date of the rule. If a court 2-43 determines that a major environmental rule was not proposed and 2-44 adopted in accordance with the procedural requirements of this 2-45 section, the rule is invalid. 2-46 (g) In this section: 2-47 (1) "Benefit" means a reasonably identifiable, 2-48 significant, direct or indirect, favorable effect, including a 2-49 quantifiable or nonquantifiable environmental, health, or economic 2-50 effect, that is expected to result from implementation of a rule. 2-51 (2) "Cost" means a reasonably identifiable, 2-52 significant, direct or indirect, adverse effect, including a 2-53 quantifiable or nonquantifiable environmental, health, or economic 2-54 effect, that is expected to result from implementation of a rule. 2-55 (3) "Major environmental rule" means a rule the 2-56 specific intent of which is to protect the environment or reduce 2-57 risks to human health from environmental exposure and that may 2-58 adversely affect in a material way the economy, a sector of the 2-59 economy, productivity, competition, jobs, the environment, or the 2-60 public health and safety of the state. 2-61 SECTION 2. This Act takes effect September 1, 1997, and 2-62 applies only to a major environmental rule, as defined by Section 2-63 2001.0225, Government Code, as added by this Act, that is proposed 2-64 by a state agency on or after that date. 2-65 SECTION 3. The importance of this legislation and the 2-66 crowded condition of the calendars in both houses create an 2-67 emergency and an imperative public necessity that the 2-68 constitutional rule requiring bills to be read on three several 2-69 days in each house be suspended, and this rule is hereby suspended.