1-1     By:  Duncan                                            S.B. No. 382
 1-2           (In the Senate - Filed February 3, 1999; February 4, 1999,
 1-3     read first time and referred to Committee on State Affairs;
 1-4     February 15, 1999, reported favorably, as amended, by the following
 1-5     vote:  Yeas 7, Nays 0; February 15, 1999, sent to printer.)
 1-6     COMMITTEE AMENDMENT NO. 1                              By:  Bernsen
 1-7           Amend S.B. No. 382 at page 1, before line 62, to add Section
 1-8     2001.039 to read as follows:
 1-9           Sec. 2001.039.  SCOPE AND EFFECT OF ORDER INVALIDATING AGENCY
1-10     RULE.  If a court finds that an agency has not substantially
1-11     complied with one or more procedural requirements of Sections
1-12     2001.0225 through 2001.034, the court may remand the rule, or a
1-13     portion of the rule, to the agency and provide a reasonable time
1-14     for the agency to either revise or readopt the rule through
1-15     established procedure.  During the remand period, the rule shall
1-16     remain effective unless the court finds good cause to invalidate
1-17     the rule or a portion of the rule, effective as of the date of the
1-18     court's order.
1-19                            A BILL TO BE ENTITLED
1-20                                   AN ACT
1-21     relating to the requirements for state agency orders adopting rules
1-22     and substantial compliance with rulemaking requirements.
1-23           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-24           SECTION 1.  Section 2001.033, Government Code, is amended to
1-25     read as follows:
1-26           Sec. 2001.033.  State Agency Order Adopting Rule.  A state
1-27     agency order finally adopting a rule must include:
1-28                 (1)  a reasoned justification for [of] the rule as a
1-29     whole consisting solely of[, including]:
1-30                       (A)  a summary of comments received from parties
1-31     interested in the rule that shows the names of interested groups or
1-32     associations offering comment on the rule and whether they were for
1-33     or against its adoption;
1-34                       (B)  a summary [restatement] of the [rule's]
1-35     factual basis for the rule as adopted; and
1-36                       (C)  the reasons why the agency disagrees with
1-37     party submissions and proposals;
1-38                 (2)  a concise restatement of the particular statutory
1-39     provisions under which the rule is adopted and of how the agency
1-40     interprets the provisions as authorizing or requiring the rule; and
1-41                 (3)  a certification that the rule, as adopted, has
1-42     been reviewed by legal counsel and found to be a valid exercise of
1-43     the agency's legal authority.
1-44           SECTION 2.  Section 2001.035, Government Code, is amended to
1-45     read as follows:
1-46           Sec. 2001.035.  Substantial Compliance Requirement; Time
1-47     Limit on Procedural Challenge.  (a)  A rule [adopted after January
1-48     1, 1976,] is voidable [not valid] unless a state agency adopts it
1-49     in substantial compliance with Sections 2001.023 through 2001.034.
1-50           (b)  A person must initiate a proceeding to contest a rule on
1-51     the ground of noncompliance with the procedural requirements of
1-52     Sections 2001.023 through 2001.034 not later than the second
1-53     anniversary of the effective date of the rule.
1-54           (c)  A state agency substantially complies with the
1-55     requirements of Section 2001.033 if the agency's reasoned
1-56     justification demonstrates in a relatively clear and logical
1-57     fashion that the rule is a reasonable means to a legitimate
1-58     objective.
1-59           (d)  A mere technical defect that does not result in
1-60     prejudice to a person's rights or privileges is not grounds for
1-61     invalidation of a rule.
1-62           SECTION 3.  (a)  Section 2001.030, Government Code, is
1-63     repealed.
 2-1           (b)  Sections 2 and 3, Chapter 1067, Acts of the 75th
 2-2     Legislature, Regular Session, 1997, are repealed.
 2-3           SECTION 4.  This Act takes effect September 1, 1999.  The
 2-4     change in law made by this Act applies to all rules adopted by a
 2-5     state agency on or after January 1, 1998, except that the change in
 2-6     law made by this Act does not apply to a challenge to a rule in a
 2-7     court action that is brought before September 1, 1999.
 2-8           SECTION 5.  The importance of this legislation and the
 2-9     crowded condition of the calendars in both houses create an
2-10     emergency and an imperative public necessity that the
2-11     constitutional rule requiring bills to be read on three several
2-12     days in each house be suspended, and this rule is hereby suspended.
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