AN ACT
1-1 relating to requirements concerning the adoption of rules by state
1-2 agencies and substantial compliance with rulemaking requirements.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Subchapter A, Chapter 2001, Government Code, is
1-5 amended by adding Section 2001.006 to read as follows:
1-6 Sec. 2001.006. ACTIONS PREPARATORY TO IMPLEMENTATION OF
1-7 STATUTE OR RULE. (a) In this section:
1-8 (1) "State agency" means a department, board,
1-9 commission, committee, council, agency, office, or other entity in
1-10 the executive, legislative, or judicial branch of state government.
1-11 The term includes an institution of higher education as defined by
1-12 Section 61.003, Education Code, and includes those entities
1-13 excluded from the general definition of "state agency" under
1-14 Section 2001.003(7).
1-15 (2) Legislation is considered to have "become law" if
1-16 it has been passed by the legislature and:
1-17 (A) the governor has approved it;
1-18 (B) the governor has filed it with the secretary
1-19 of state, having neither approved nor disapproved it;
1-20 (C) the time for gubernatorial action has
1-21 expired under Section 14, Article IV, Texas Constitution, the
1-22 governor having neither approved nor disapproved it; or
1-23 (D) the governor has disapproved it and the
1-24 legislature has overridden the governor's disapproval in accordance
2-1 with Section 14, Article IV, Texas Constitution.
2-2 (b) In preparation for the implementation of legislation
2-3 that has become law but has not taken effect, a state agency may
2-4 adopt a rule or take other administrative action that the agency
2-5 determines is necessary or appropriate and that the agency would
2-6 have been authorized to take had the legislation been in effect at
2-7 the time of the action.
2-8 (c) In preparation for the implementation of a rule that has
2-9 been finally adopted by a state agency but has not taken effect, a
2-10 state agency may take administrative action that the agency
2-11 determines is necessary or appropriate and that the agency would
2-12 have been authorized to take had the rule been in effect at the
2-13 time of the action.
2-14 (d) A rule adopted under Subsection (b) may not take effect
2-15 earlier than the legislation being implemented takes effect.
2-16 Administrative action taken under Subsection (b) or (c) may not
2-17 result in implementation or enforcement of the applicable
2-18 legislation or rule before the legislation or rule takes effect.
2-19 SECTION 2. Section 2001.033, Government Code, is amended to
2-20 read as follows:
2-21 Sec. 2001.033. State Agency Order Adopting Rule. (a) A
2-22 state agency order finally adopting a rule must include:
2-23 (1) a reasoned justification for [of] the rule as
2-24 adopted consisting solely of[, including]:
2-25 (A) a summary of comments received from parties
2-26 interested in the rule that shows the names of interested groups or
3-1 associations offering comment on the rule and whether they were for
3-2 or against its adoption;
3-3 (B) a summary [restatement] of the [rule's]
3-4 factual basis for the rule as adopted which demonstrates a rational
3-5 connection between the factual basis for the rule and the rule as
3-6 adopted; and
3-7 (C) the reasons why the agency disagrees with
3-8 party submissions and proposals;
3-9 (2) a concise restatement of the particular statutory
3-10 provisions under which the rule is adopted and of how the agency
3-11 interprets the provisions as authorizing or requiring the rule; and
3-12 (3) a certification that the rule, as adopted, has
3-13 been reviewed by legal counsel and found to be a valid exercise of
3-14 the agency's legal authority.
3-15 (b) Nothing in this section shall be construed to require
3-16 additional analysis of alternatives not adopted by an agency beyond
3-17 that required by Subdivision (1)(C) or to require the reasoned
3-18 justification to be stated separately from the statements required
3-19 in Subdivision (1).
3-20 SECTION 3. Section 2001.035, Government Code, is amended to
3-21 read as follows:
3-22 Sec. 2001.035. Substantial Compliance Requirement; Time
3-23 Limit on Procedural Challenge. (a) A rule [adopted after January
3-24 1, 1976,] is voidable [not valid] unless a state agency adopts it
3-25 in substantial compliance with Sections 2001.0225 [2001.023]
3-26 through 2001.034.
4-1 (b) A person must initiate a proceeding to contest a rule on
4-2 the ground of noncompliance with the procedural requirements of
4-3 Sections 2001.0225 [2001.023] through 2001.034 not later than the
4-4 second anniversary of the effective date of the rule.
4-5 (c) A state agency substantially complies with the
4-6 requirements of Section 2001.033 if the agency's reasoned
4-7 justification demonstrates in a relatively clear and logical
4-8 fashion that the rule is a reasonable means to a legitimate
4-9 objective.
4-10 (d) A mere technical defect that does not result in
4-11 prejudice to a person's rights or privileges is not grounds for
4-12 invalidation of a rule.
4-13 SECTION 4. Subchapter B, Chapter 2001, Government Code, is
4-14 amended by adding Section 2001.039 to read as follows:
4-15 Sec. 2001.039. SCOPE AND EFFECT OF ORDER INVALIDATING AGENCY
4-16 RULE. If a court finds that an agency has not substantially
4-17 complied with one or more procedural requirements of Sections
4-18 2001.0225 through 2001.034, the court may remand the rule, or a
4-19 portion of the rule, to the agency and, if it does so remand, shall
4-20 provide a reasonable time for the agency to either revise or
4-21 readopt the rule through established procedure. During the remand
4-22 period, the rule shall remain effective unless the court finds good
4-23 cause to invalidate the rule or a portion of the rule, effective as
4-24 of the date of the court's order.
4-25 SECTION 5. Section 2006.001, Government Code, is amended to
4-26 read as follows:
5-1 Sec. 2006.001. DEFINITIONS. In this subchapter:
5-2 (1) "Micro-business" means a legal entity, including a
5-3 corporation, partnership, or sole proprietorship, that:
5-4 (A) is formed for the purpose of making a
5-5 profit;
5-6 (B) is independently owned and operated; and
5-7 (C) has not more than 20 employees.
5-8 (2) "Small business" means a legal entity, including a
5-9 corporation, partnership, or sole proprietorship, that:
5-10 (A) is formed for the purpose of making a
5-11 profit;
5-12 (B) is independently owned and operated; and
5-13 (C) has fewer than 100 employees or less than $1
5-14 million in annual gross receipts.
5-15 (3) [(2)] "State agency" means a department, board,
5-16 bureau, commission, division, office, council, or other agency of
5-17 the state.
5-18 SECTION 6. Subsections (a) and (f), Section 2006.002,
5-19 Government Code, are amended to read as follows:
5-20 (a) A state agency considering adoption of a rule that would
5-21 have an adverse economic effect on small businesses or
5-22 micro-businesses shall reduce that effect if doing so is legal and
5-23 feasible considering the purpose of the statute under which the
5-24 rule is to be adopted.
5-25 (f) To reduce an adverse effect of rules on
5-26 micro-businesses, a state agency shall [may] adopt provisions
6-1 concerning micro-businesses that are uniform with [similar to]
6-2 those outlined in Subsections (b)-(d) [Subsection (b)] for small
6-3 businesses.
6-4 SECTION 7. Sections 2 and 3, Chapter 1067, Acts of the 75th
6-5 Legislature, Regular Session, 1997, are repealed.
6-6 SECTION 8. This Act takes effect September 1, 1999. The
6-7 change in law made by this Act applies to all rules adopted by a
6-8 state agency on or after January 1, 1998, except that the change in
6-9 law made by this Act does not apply to a challenge to a rule in a
6-10 court action that is brought before September 1, 1999.
6-11 SECTION 9. The importance of this legislation and the
6-12 crowded condition of the calendars in both houses create an
6-13 emergency and an imperative public necessity that the
6-14 constitutional rule requiring bills to be read on three several
6-15 days in each house be suspended, and this rule is hereby suspended.
_______________________________ _______________________________
President of the Senate Speaker of the House
I hereby certify that S.B. No. 382 passed the Senate on
February 24, 1999, by a viva-voce vote; and that the Senate
concurred in House amendments on May 27, 1999, by a viva-voce vote.
_______________________________
Secretary of the Senate
I hereby certify that S.B. No. 382 passed the House, with
amendments, on May 25, 1999, by a non-record vote.
_______________________________
Chief Clerk of the House
Approved:
_______________________________
Date
_______________________________
Governor