Relating to the adoption and review of rules by state agencies.

89(R) HB 5083 - House Committee Report version - Bill Text

89R15304 JCG-F

By: Patterson, Capriglione, Curry

H.B. No. 5083

A BILL TO BE ENTITLED

AN ACT

relating to the adoption and review of rules by state agencies.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 28.002(m), Education Code, is amended to

read as follows:

(m) Section
2001.0395
[
2001.039
], Government Code, [
as

added by Chapter 1499, Acts of the 76th Legislature, Regular

Session, 1999,
] does not apply to a rule adopted by the State Board

of Education under Subsection (c) or (d).

SECTION 2. Subchapter A, Chapter 2001, Government Code, is

amended by adding Section 2001.008 to read as follows:

Sec.

2001.008.

EXPRESS STATUTORY AUTHORITY FOR RULE OR

GUIDANCE DOCUMENT REQUIRED. (a) In this section, "guidance

document" means any letter, opinion, compliance manual, or other

statement issued by a state agency that explains or interprets one

or more of the state agency's rules.

(b)

A state agency may not adopt a rule or issue a guidance

document unless the agency has been granted an express statutory

delegation of authority to adopt the rule or issue the guidance

document.

(c)

For purposes of Subsection (b), a state agency does not

have an express statutory delegation of authority to adopt a rule or

issue a guidance document solely because the rule or guidance

document is reasonably related to the purpose of the state agency's

enabling legislation or to a general statutory power or duty of the

state agency.

SECTION 3. Subchapter B, Chapter 2001, Government Code, is

amended by adding Section 2001.0227 to read as follows:

Sec.

2001.0227.

CERTAIN RULES PROHIBITED BASED ON COSTS OF

COMPLIANCE; COST-BENEFIT ANALYSES REQUIRED. (a) A state agency

shall prepare a cost-benefit analysis for each proposed rule as

provided by this section.

(b) The cost-benefit analysis must include:

(1)

a cost-benefit analysis estimating for each year

of the first six years that the rule will be in effect:

(A)

the public benefits expected as a result of

adoption of the rule; and

(B)

the expected economic costs to persons

required to comply with the rule;

(2)

an explanation of all assumptions, methods,

supporting data, and, if any, discount rates used in preparing the

cost-benefit analysis; and

(3)

a clear statement of the total expected economic

costs to persons required to comply with the rule and the total

public benefits expected as a result of the adoption of the rule.

(c) A state agency may not adopt a proposed rule:

(1)

for which the cost-benefit analysis under

Subsection (b) states that the total expected economic costs to

comply with the rule exceed the total public benefits expected as a

result of the adoption of the proposed rule; or

(2)

if there are alternative methods of regulation

that could accomplish the legislature's intent in authorizing the

rule and any statutory purposes provided by the legislature at a

lower economic cost to persons required to comply with the rule.

(d)

If the proposed rule takes effect and remains in effect

at least six years, the state agency shall:

(1)

solicit from interested stakeholders data

regarding the stakeholders' experience and actual economic costs of

compliance with the rule; and

(2)

conduct a retrospective cost-benefit analysis

that compares:

(A)

estimates made under Subsection (b)(1)

regarding the economic costs of compliance; and

(B)

the actual economic costs of compliance based

on the data provided under Subdivision (1) and any other readily

available data relevant to this purpose.

(e)

If a state agency uses a discount rate in preparing an

analysis under Subsection (b) or (d), the state agency shall

provide:

(1)

a reasoned justification for the use of the

discount rate; and

(2)

another cost-benefit analysis for the same rule

that does not include the use of the discount rate.

(f)

A state agency that prepares an analysis under

Subsection (b) or (d) shall publish on the agency's publicly

accessible Internet website all documentation and other materials

used to prepare the analysis in a machine-readable format.

(g)

A reference to an existing rule under this section

includes any amendments to the rule, and, to the extent feasible,

the state agency shall prepare the analysis required under

Subsection (b) based on the terms of the rule as amended.

SECTION 4. Section 2001.024(a), Government Code, is amended

to read as follows:

(a) The notice of a proposed rule must include:

(1) a brief explanation of the proposed rule;

(2) the text of the proposed rule, except any portion

omitted under Section 2002.014, prepared in a manner to indicate

any words to be added or deleted from the current text;

(3) a statement of the statutory or other authority

under which the rule is proposed to be adopted, including:

(A) a concise explanation of the particular

statutory or other provisions under which the rule is proposed;

(B) the section or article of the code affected;

(C) if applicable, the bill number for the

legislation that enacted the statutory authority under which the

rule is proposed to be adopted if the legislation was enacted during

the four-year period preceding the date notice of the proposed rule

is given; and

(D) a certification that the proposed rule has

been reviewed by legal counsel and found to be within the state

agency's authority to adopt;

(4) a fiscal note showing the name and title of the

officer or employee responsible for preparing or approving the note

and stating for each year of the first five years that the rule will

be in effect:

(A) the additional estimated cost to the state

and to local governments expected as a result of enforcing or

administering the rule;

(B) the estimated reductions in costs to the

state and to local governments as a result of enforcing or

administering the rule;

(C) the estimated loss or increase in revenue to

the state or to local governments as a result of enforcing or

administering the rule; and

(D) if applicable, that enforcing or

administering the rule does not have foreseeable implications

relating to cost or revenues of the state or local governments;

(5)
the cost-benefit analysis required under Section

2001.0227
[
a note about public benefits and costs showing the name

and title of the officer or employee responsible for preparing or

approving the note and stating for each year of the first five years

that the rule will be in effect:

[
(A)

the public benefits expected as a result of

adoption of the proposed rule; and

[
(B)

the probable economic cost to persons

required to comply with the rule
];

(6) the local employment impact statement prepared

under Section 2001.022, if required;

(7) a request for comments on the proposed rule from

any interested person; and

(8) any other statement required by law.

SECTION 5. Section 2001.033, Government Code, is amended by

amending Subsection (a) and adding Subsection (c) to read as

follows:

(a) A state agency order finally adopting a rule must

include:

(1) a reasoned justification for the rule as adopted

consisting solely of:

(A) a summary of comments received from parties

interested in the rule that shows the names of interested groups or

associations offering comment on the rule and whether they were for

or against its adoption;

(B) a summary of the factual basis for the rule as

adopted which demonstrates a rational connection between the

factual basis for the rule and the rule as adopted; and

(C) the reasons why the agency disagrees with

party submissions and proposals;

(2) a concise restatement of the particular statutory

provisions under which the rule is adopted and of how the agency

interprets the provisions as authorizing or requiring the rule;

[
and
]

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

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

the agency's legal authority
; and

(4)

the cost-benefit analysis required under Section

2001.0227 updated to reflect reasonable public commentary on the

state agency's calculations of the costs and benefits of the rule or

a reasoned justification for why the agency did not update the

cost-benefit analysis based on the public commentary
.

(c) A state agency rule may not be arbitrary or capricious.

SECTION 6. Section 2001.038, Government Code, is amended by

adding Subsection (g) to read as follows:

(g)

A respondent subject to an enforcement action by a state

agency for the violation of a rule may request a declaratory

judgment from the court finding a rule invalid if the state agency

lacks express statutory delegation of authority to adopt the rule

on which the enforcement action is based, including if the state

agency relies on a guidance document to interpret the rule for

purposes of the enforcement action. A court shall award a

respondent that prevails on the ground provided by this subsection

reasonable attorney's fees and court costs. For purposes of this

section, "guidance document" has the meaning assigned by Section

2001.008.

SECTION 7. Subchapter B, Chapter 2001, Government Code, is

amended by adding Sections 2001.0395 and 2001.042 to read as

follows:

Sec.

2001.0395.

EXPIRATION OF RULES. (a) Each state agency

rule expires on the 12th anniversary of the rule's effective date

unless the state agency that adopted the rule readopts the rule

before the rule's expiration date in accordance with this section.

(b)

The expiration date for a readopted rule is the 12th

anniversary of the readopted rule's effective date.

(c)

The adoption of an amendment to an existing rule does

not affect the expiration date of the rule under this section unless

the amendment is made as part of a readoption of the entire rule or

chapter of the Texas Administrative Code containing the amended

rule.

(d)

The procedures of this subchapter required for the

adoption of a rule apply to the readoption of a rule under this

section, including:

(1)

preparing a cost-benefit analysis under Section

2001.0227(b);

(2)

providing opportunity for public comment under

Section 2001.029;

(3)

responding to substantive public comments, as

required under Section 2001.033(a)(1)(C); and

(4)

providing an updated cost-benefit analysis under

Section 2001.033(a)(4).

(e)

In readopting a rule under this section, a state agency

must also:

(1)

provide an assessment of whether the reasons for

initially adopting the rule continue to exist;

(2)

provide an assessment of whether the rule is

obsolete, unnecessary, or duplicative or conflicts with other

rules;

(3)

consider public comments that provide data and

information on the actual economic costs to persons required to

comply with the rule;

(4)

to the fullest extent practicable, base estimates

on expected economic costs to persons required to comply with the

rule on data and information described by Section 2001.0227(d)(1);

and

(5)

publish all notices, analyses, and responses to

public comments on the state agency's publicly accessible Internet

website.

(f)

Each state agency shall with respect to the state

agency's rules:

(1)

publish on the state agency's publicly accessible

Internet website the expiration date for each rule; and

(2)

make the expiration date of each rule available

through an application programming interface that allows automated

access and monitoring of the rules' expiration dates.

(g)

The secretary of state shall include a rule's expiration

date in the online publication of the Texas Administrative Code in a

standardized metadata field that accompanies each section of the

code.

(h)

Notwithstanding any other provision of this section, a

rule does not expire under this section if the governor in writing

exempts a rule from the application of this section. On the written

request from a state agency, the governor shall exempt a rule that:

(1) is necessary:

(A) to comply with federal law; or

(B)

because federal funding is conditioned on the

rule remaining in effect; or

(2) is authorized or required by the constitution.

(i)

A state agency that administers a rule exempted under

Subsection (h) shall every 12 years after the date of the exemption

consider less burdensome alternatives to the rule, solicit public

commentary on those potential alternatives, and in determining

whether to adopt less burdensome alternatives, calculate the

expected economic costs to persons required to comply with the rule

based on data and information provided by persons subject to the

rule and bearing those costs.

(j)

On written request by a state agency, the governor may

extend a rule's expiration date under this section for a period not

to exceed one year following the date on which the extension is

granted. A written request under this subsection to extend a rule's

expiration date must:

(1)

explain the reason the state agency cannot

complete the readoption of the rule under this section before the

rule's expiration date; and

(2)

describe the harm to the public's health, safety,

or welfare that would result if the rule expired.

(k)

Any extension granted under Subsection (j) must be

accompanied by findings affirming the conditions described by

Subsections (j)(1) and (2).

Sec.

2001.042.

CERTAIN ENFORCEMENT ACTIONS INVALID

REGARDLESS OF COMMENCEMENT DATE. An enforcement action brought by

a state agency shall be dismissed if the enforcement action is based

on the violation of a rule that expired, regardless of whether the

enforcement action commenced before the date the rule expired.

SECTION 8. Section 801.022(e), Occupations Code, is amended

to read as follows:

(e) Not later than December 31, 2026, the department shall

conduct a review under
former
Section 2001.039, Government Code, of

each rule under 22 T.A.C. Part 24. In conducting the review under

this subsection, the department shall ensure that license holders

and the public have a meaningful opportunity to provide input and

recommend changes to the rules.

SECTION 9. Section 2001.039, Government Code, is repealed.

SECTION 10. (a) Notwithstanding Section 2001.0395,

Government Code, as added by this Act, a state agency shall assign

the state agency's rules that exist on the effective date of this

section eight different expiration dates for the purpose of

staggering the expiration dates of the rules and implementing that

section.

(b) An expiration date assigned to a rule under this section

may not be later than January 1, 2040.

(c) Not later than December 1, 2025, each state agency shall

report to the governor the expiration dates assigned under this

section.

(d) The governor shall publish on the office's publicly

accessible Internet website a schedule of all the expiration dates

assigned under this section.

(e) This section takes effect September 1, 2025.

SECTION 11. The changes in law made by this Act to

Subchapter B, Chapter 2001, Government Code, apply only to a

proposed state agency rule for which notice is filed with the

secretary of state under Section 2001.023, Government Code, on or

after the effective date of this Act.

SECTION 12. Except as otherwise provided by this Act, this

Act takes effect January 1, 2026.