SB1343 - 562R

Be it enacted by the Legislature of the State of Arizona:

Section 1. Section 41-1011, Arizona Revised Statutes, is amended to read:

START_STATUTE41-1011. Preparation and publication of code and register

A. The secretary of state shall prepare and publish the code and register.

B. The secretary of state shall prescribe a uniform numbering system and have reasonable discretion to determine the form and style for rules filed with and published by the office. The secretary of state shall refuse to accept a rule notice or other notice filing if the notice or filing does not comply with the secretary of state's prescribed filing requirements, numbering system, form and style.

C. The secretary of state shall assign titles and chapters to agencies and prepare, arrange and correlate rules and other text as necessary when publishing the code and register. The secretary of state may not alter the sense, meaning or effect of any rule but may renumber rules and parts of rules, rearrange rules, change reference numbers to agree with renumbered rules and parts of rules, substitute the proper rule number for "the preceding rule" and similar terms, delete figures if they are merely a repetition of written words, change capitalization for the purpose of uniformity and correct manifest clerical or typographical errors. With the consent of the attorney general, the secretary of state may remove from the code a provision of a rule that a court of final appeal declares unconstitutional or otherwise invalid and a rule made by an agency that is abolished if the rule is not transferred to a successor agency. The secretary of state shall remove a rule from the code when notified by the governor's regulatory review council that the rule has expired pursuant to section 41-1056, subsection J M. END_STATUTE

Sec. 2. Section 41-1051, Arizona Revised Statutes, is amended to read:

START_STATUTE41-1051. Governor's regulatory review council; membership; terms; compensation; powers

A. The governor's regulatory review council is established consisting of six members who are appointed by the governor pursuant to section 38-211 and who are subject to sections 38-291 and 38-295 and the director of the department of administration or the assistant director of the department of administration who is responsible for administering the council. The director or assistant director is an ex officio member and chairperson of the council. The council shall elect a vice-chairperson vice chairperson to serve as chairperson in the chairperson's absence. The governor shall appoint at least one member who represents the public interest, at least one member who represents the business community, at least one member who is a small business owner, one member from a list of three persons who are not legislators submitted by the president of the senate and one member from a list of three persons who are not legislators submitted by the speaker of the house of representatives. At least one member of the council shall be an attorney licensed to practice law in this state. The governor shall appoint the members of the council for staggered terms of three years. A vacancy occurring during the term of office of any member shall be filled by appointment by the governor for the unexpired portion of the term in the same manner as provided in this section.

B. The council shall meet at least once a month at a time and place set by the chairperson and at other times and places as the chairperson deems necessary.

C. Members of the council are eligible to receive compensation in an amount of two hundred dollars $200 for each day on which the council meets and reimbursement of expenses pursuant to title 38, chapter 4, article 2.

D. The chairperson, subject to chapter 4, article 4 and, as applicable, articles 5 and 6 of this title, shall employ, determine the conditions of employment of and specify the duties of administrative, secretarial and clerical employees as the chairperson deems necessary.

E. The council may make rules pursuant to this chapter to carry out the purposes of this chapter.

F. The council shall make a list of agency rules approved or returned pursuant to sections 41-1027 and 41-1052 and section 41-1056, subsection C F for the previous twelve-month period available to the public on request and on the council's website.END_STATUTE

Sec. 3. Section 41-1056, Arizona Revised Statutes, is amended to read:

START_STATUTE41-1056. Review by agency

A. At least once every five years, each agency shall review all of its rules, including rules made pursuant to an exemption from this chapter or any part of this chapter, to determine whether any rule should be amended or repealed. The agency shall prepare and obtain council approval of a written report summarizing its findings, its supporting reasons and any proposed course of action. The report shall contain a certification that the agency is in compliance with section 41-1091. For each rule, the report shall include a concise analysis of all of the following:

1. The rule's effectiveness in achieving its objectives, including a summary of any available data supporting the conclusions reached.

2. Written criticisms of the rule received during the previous five years, including any written analyses submitted to the agency questioning whether the rule is based on valid scientific or reliable principles or methods.

3. Authorization of the rule by existing statutes.

4. Whether the rule is consistent with statutes or other rules made by the agency and current agency enforcement policy.

5. The clarity, conciseness and understandability of the rule.

6. The estimated economic, small business and consumer impact of the rules as compared to the economic, small business and consumer impact statement prepared on the last making of the rules.

7. Any analysis submitted to the agency by another person regarding the rule's impact on this state's business competitiveness as compared to the competitiveness of businesses in other states.

8. If applicable, that the agency completed the previous five-year review process.

9. A determination that the probable benefits of the rule outweigh within this state the probable costs of the rule, and the rule imposes the least burden and costs to persons regulated by the rule, including paperwork and other compliance costs, necessary to achieve the underlying regulatory objective.

10. A determination that the rule is not more stringent than a corresponding federal law unless there is statutory authority to exceed the requirements of that federal law.

11. For rules adopted after July 29, 2010 that require the issuance of a regulatory permit, license or agency authorization, whether the rule complies with section 41-1037.

B. Any analysis that is performed pursuant to subsection A of this section and that examines the economic impact, compliance, implementation or other costs of the rule, to the greatest extent possible shall use actual impacts and costs from the last five years that the rule has been in effect as the basis for any calculation rather than only using estimated impacts and costs.

C. Any rule regarding occupational licenses adopted by an agency pursuant to Title 32 shall automatically expire at the conclusion of the FIVE-YEAR review unless the agency performs a review pursuant to subsection A of this section and does all of the following:

1. Readopts the code chapter pursuant to article 3 of this chapter.

2. Publishes an evaluation of the burdens on similar occupational licenses in all states that border this state and justifies any instance where this state imposes a greater burden on a licensee than any neighboring states.

3. Publishes a report available on the agency's website that includes analyses and responses to public comments.

D. The automatic expiration of a rule pursuant to subsection C of this section does not apply to rules that meet any the following:

1. Are Required to comply with federal law or receive federal monies.

2. are adopted pursuant to rulemaking authority under the constitution of this state.

3. are adopted by a regulating entity that is directly managed by an elected official in this state.

B. E. An agency may also include as part of the report the text of a proposed expedited rule pursuant to section 41-1027.

C. F. The council shall schedule the periodic review of each agency's rules and shall approve or return, in whole or in part, the agency's report on its review. The council may grant an agency an extension from filing an agency's report. If the council returns an agency's report, in whole or in part, the council shall inform the agency of the manner in which its report is inadequate and, in consultation with the agency, shall schedule submission of a revised report. The council shall not approve a report unless the report complies with subsection A of this section.

D. G. The council may review rules outside of the five-year review process if requested by at least four council members.

E. H. The council may require the agency to propose an amendment or repeal of the rule by a date no not earlier than six months after the date of the meeting at which the council considers the agency's report on its rule if the council determines the agency's analysis under subsection A of this section demonstrates that the rule is materially flawed, including that the rule:

1. Is not authorized by statute.

2. Is inconsistent with other statutes, rules or agency enforcement policies and the inconsistency results in a significant burden on the regulated public.

3. Imposes probable costs, including costs to the regulated person, that significantly exceed the probable benefits of the rule within this state.

4. Is more stringent than a corresponding federal law and there is no statutory authority to exceed the requirements of federal law.

5. Is not clear, concise and understandable.

6. Does not use general permits if required under section 41-1037.

7. Does not impose the least burden to persons regulated by the rule as necessary to achieve the underlying regulatory objective of the rule.

8. Does not rely on valid scientific or reliable principles and methods, including a study, if the rule relies on scientific principles or methods, and a person has submitted an analysis under subsection A of this section questioning whether the rule is based on valid scientific or reliable principles or methods. In making a determination of validity or reliability, the council shall consider the factors listed in section 41-1052, subsection G.

F. I. An agency may request an extension of no not longer than one year from the date specified by the council pursuant to subsection E H of this section by sending a written request to the council that:

1. Identifies the reason for the extension request.

2. Demonstrates good cause for the extension.

G. J. The agency shall notify the council of an amendment or repeal of a rule for which the council has set an expiration date under subsection E H of this section. If the agency does not amend or repeal the rule by the date specified by the council under subsection E H of this section or the extended date under subsection F I of this section, the rule automatically expires. The council shall file a notice of rule expiration with the secretary of state and notify the agency of the expiration of the rule.

H. K. The council may reschedule a report or portion of a report for any rule that is scheduled for review and that was initially made or substantially revised within two years before the due date of the report as scheduled by the council.

I. L. If an agency finds that it cannot provide the written report to the council by the date it is due, the agency may file an extension with the council before the due date indicating the reason for the extension. The timely filing for an extension permits allows the agency to submit its report on or before the date prescribed by the council.

J. M. If an agency fails to submit its report, including a revised report, pursuant to subsection A or C F of this section, or fails to file an extension before the due date of the report or if it files an extension and does not submit its report within the extension period or if an occupational licensing agency has not timely adopted its rules pursuant to subsection C of this section, the rules scheduled for review expire and the council shall:

1. Cause a notice to be published in the next register that states the rules have expired and are no longer enforceable.

2. Notify the secretary of state that the rules have expired and that the rules are to be removed from the code.

3. Notify the agency that the rules have expired and are no longer enforceable.

K. N. If a rule expires as provided in subsection J M of this section and the agency wishes to reestablish the rule, the agency shall comply with the requirements of this chapter.

L. O. Not less than ninety days before the due date of a report, the council shall send a written notice to the head of the agency whose report is due. The notice shall list the rules to be reviewed and the date the report is due.

M. P. A person who is regulated or could be regulated by an obsolete rule may petition the council to require an agency that has the obsolete rule to consider including the rule in the five-year report with a recommendation for repeal of the rule.

N. Q. A person who is required to obtain or could be required to obtain a license may petition the council to require an agency to consider including a recommendation for reducing a licensing time frame in the five-year report. END_STATUTE