By:  Duncan                                           S.B. No. 1636

         Line and page numbers may not match official copy.

         Bill not drafted by TLC or Senate E&E.

                                A BILL TO BE ENTITLED

                                       AN ACT

 1-1     relating to the requirements for state agency orders adopting rules

 1-2     and substantial compliance with those requirements.

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

 1-4           SECTION 1.  Section 2001.030 is repealed in its entirety.

 1-5           SECTION 2.  Section 2001.033, Texas Government Code, is

 1-6     amended as follows:

 1-7           Sec. 2001.033.  State Agency Order Adopting Rule.  (a)  A

 1-8     state agency order finally adopting a rule must include:

 1-9                 (1)  a reasoned justification for the rule as a whole

1-10     comprised solely of[, including]:

1-11                       (A)  a summary of comments received from parties

1-12     interested in the rule that shows the names of interested groups or

1-13     associations offering comment on the rule and whether they were for

1-14     or against its adoption;

1-15                       (B)  a summary [restatement] of the [rule's]

1-16     factual basis for the rule as adopted; and

1-17                       (C)  the reasons why the agency disagrees with

1-18     party submissions and proposals;

1-19                 (2)  a concise restatement of the particular statutory

1-20     provisions under which the rule is adopted and of how the agency

1-21     interprets the provisions as authorizing or requiring the rule; and

 2-1                 (3)  a certification that the rule, as adopted, has

 2-2     been reviewed by legal counsel and found to be a valid exercise of

 2-3     the agency's legal authority.

 2-4           (b)  Administrative convenience may be an appropriate

 2-5     justification for a rule.

 2-6           SECTION 3.  Section 2001.035, Texas Government Code, is

 2-7     amended as follows:

 2-8           Sec. 2001.035.  Substantial Compliance Requirement; Time

 2-9     Limit on Procedural Challenge.  (a)  A rule [adopted after January

2-10     1, 1976] is voidable [not valid] unless a state agency adopts it in

2-11     substantial compliance with Sections 2001.023 through 2001.034.

2-12           (b)  A person must initiate a proceeding to contest a rule on

2-13     the ground of noncompliance with the procedural requirements of

2-14     Sections 2001.023 through 2001.034 not later than the second

2-15     anniversary of the effective date of the rule.

2-16           (c)  An agency substantially complies with the requirements

2-17     of Section 2001.033 if its reasoned justification demonstrates in a

2-18     relatively clear and logical fashion that the rule is a reasonable

2-19     means to a legitimate objective.

2-20           (d)  Mere technical defects which do not result in prejudice

2-21     to a party's rights or privileges are not grounds for invalidation

2-22     of a rule.

2-23           SECTION 4.  This Act takes effect September 1, 1997 and

2-24     applies to all rules adopted on or after January 1, 1996.

2-25           SECTION 5.  The importance of this legislation and the

 3-1     crowded condition of the calendars in both houses create an

 3-2     emergency and an imperative public necessity that the

 3-3     constitutional rule requiring bills to be read on three several

 3-4     days in each house be suspended, and this rule is hereby suspended.