78R8123 KEG-D

By:  Cook of Colorado                                             H.B. No. 2390



A BILL TO BE ENTITLED

AN ACT

relating to state agency rules affecting small businesses.                    
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Sections 2006.001(2) and (3), Government Code, 
are amended to read as follows:
		(2)  "Small business" means a legal entity, including a 
corporation, partnership, or sole proprietorship, that:
			(A)  is formed for the purpose of making a profit;                           
			(B)  is independently owned and operated;  and                               
			(C)  has fewer than 500 [100] employees or less 
than $6 [$1] million in annual gross receipts.
		(3)  "State agency" means a department, board, bureau, 
commission, division, office, council, or other agency of the state 
and includes an officer who is authorized by law to determine 
contested cases.
	SECTION 2.  Section 2006.002, Government Code, is amended by 
amending Subsections (c) and (d) and adding Subsection (c-1) to 
read as follows:
	(c)  Before adopting a proposed rule that may [would] have an 
adverse economic effect on a small business, a state agency shall 
prepare:
		(1)  an economic impact statement that estimates the 
number of small businesses subject to the proposed rule, projects 
the economic impact of the rule on small businesses, and describes 
alternative methods of achieving the purpose of the proposed rule; 
and
		(2)  a regulatory flexibility analysis that includes 
the agency's consideration of alternative methods of achieving the 
purpose of the proposed rule.
	(c-1)  The analysis under Subsection (c) shall consider, if 
consistent with the health, safety, and environmental and economic 
welfare of the state, using regulatory methods that will accomplish 
the objectives of applicable rules while minimizing adverse impacts 
on small businesses.  The state agency must include in the analysis 
several proposed methods of reducing the adverse impact of a 
proposed rule on a small business. [a statement of the effect of 
the rule on small businesses.  The statement must include:
		[(1)  an analysis of the cost of compliance with the 
rule for small businesses; and
		[(2)  a comparison of the cost of compliance for small 
businesses with the cost of compliance for the largest businesses 
affected by the rule, using at least one of the following standards:
			[(A)  cost for each employee;                               
			[(B)  cost for each hour of labor; or                       
			[(C)  cost for each $100 of sales.]                         
	(d)  The agency shall include the economic impact statement 
and regulatory flexibility analysis [statement of effect] as part 
of the notice of the proposed rule that the agency files with the 
secretary of state for publication in the Texas Register and shall 
provide copies to the standing committee of each house of the 
legislature that is charged with reviewing the proposed rule.
	SECTION 3.  Subchapter A, Chapter 2006, Government Code, is 
amended by adding Sections 2006.003 and 2006.004 to read as 
follows:
	Sec. 2006.003.  JUDICIAL REVIEW OF STATE AGENCY DECISION TO 
ADOPT RULE.  (a)  A small business that is adversely affected by a 
state agency's final action with regard to the adoption of a rule is 
entitled to judicial review of the agency's compliance with the 
requirements of this subchapter.
	(b)  A small business may seek judicial review beginning on 
the date of the state agency's final action with regard to the 
adoption of a rule and not later than one year after that date.
	Sec. 2006.004.  STATE AGENCY REVIEW OF RULES.  (a)  A state 
agency shall:
		(1)  review rules adopted before January 1, 2004, to 
determine whether those rules have any adverse economic impact on 
small businesses; and
		(2)  at least every five years, review rules adopted on 
or after January 1, 2004, to determine whether those rules have any 
adverse economic impact on small businesses.
	(b)  If a state agency determines that a rule has an adverse 
economic impact on small businesses, the agency shall decide 
whether the rule should be repealed or amended to minimize any 
adverse economic impact on small businesses.
	SECTION 4.  Section 2006.002, Government Code, as amended by 
this Act, applies only to a rule that is adopted on or after January 
1, 2004.  A rule adopted before that date is governed by the law in 
effect when the rule was adopted, and the former law is continued in 
effect for that purpose.
	SECTION 5.  Not later than September 1, 2007, a state agency 
shall review all rules adopted before January 1, 2004, as required 
by Section 2006.004(a)(1), Government Code, as added by this Act, 
to determine whether those rules have any adverse economic impact 
on small businesses.
	SECTION 6.  This Act takes effect September 1, 2003.