SECOND REGULAR SESSION
SENATE BILL NO. 873
90TH GENERAL ASSEMBLY
INTRODUCED BY SENATOR FLOTRON.
Read 1st time January 19, 2000, and 1,000 copies ordered printed.
TERRY L. SPIELER, Secretary.
3407S.01I
AN ACT
To amend chapter 620, RSMo, by adding thereto seven new sections relating to small businesses.
Section A. Chapter 620, RSMo, is amended by adding thereto seven new sections, to be known as sections 620.050, 620.052, 620.054, 620.056, 620.058, 620.060 and 620.062, to read as follows:
620.050. As used in sections 620.050 to 620.062, unless the context clearly requires otherwise, the following terms shall mean:
(1) "Affected small businesses" or "affects small business", any potential or actual requirement imposed upon a small business through an agency's proposed or adopted rule that will cause a direct and significant economic burden upon a small business, or is directly related to the formation, operation, or expansion of a small business;
(2) "Agency", each state board, commission, department, or officer authorized by law to make rules, except those in the legislative or judicial branches;
(3) "Board", the small business regulatory review board; and
(4) "Small business", a for-profit enterprise consisting of fewer than one hundred full-time or part-time employees.
620.052. 1. Prior to submitting proposed rules for adoption, amendment, or repeal pursuant to chapter 536, RSMo, the agency shall determine whether the proposed rules affect small business, and if so, the availability and practicability of less restrictive alternatives that could be implemented. This section shall not apply to emergency rulemaking as set forth in section 536.025, RSMo. This section shall be in addition to the fiscal note requirement of sections 536.200 to 536.210, RSMo.
2. If the proposed rules affect small business, the agency shall consider creative, innovative, or flexible methods of compliance for small businesses and prepare a small business impact statement to be submitted with the proposed rules to the small business regulatory review board prior to providing notice for a public hearing. The statement shall provide a reasonable determination of the following:
(1) The businesses that will be directly affected by, bear the costs of, or directly benefit from the proposed rules;
(2) Description of the small businesses that will be required to comply with the proposed rules and how they may be adversely affected;
(3) In dollar amounts, the increase in the level of direct costs such as fees or administrative penalties, and indirect costs such as reporting, recordkeeping, equipment, construction, labor, professional services, revenue loss, or other costs associated with compliance;
(4) The probable monetary costs and benefits to the implementing agency and other agencies directly affected, including the estimated total amount the agency expects to collect from any additionally imposed fees and the manner in which the moneys will be used;
(5) The methods the agency considered or used to reduce the impact on small business such as consolidation, simplification, differing compliance or reporting requirements, less stringent deadlines, performance rather than design standards, exemption, or any other mitigating techniques;
(6) How the agency involved small business in the development of the proposed rules; and
(7) Whether the proposed rules include provisions that are more stringent than those mandated by any comparable or related federal, state, or county standards, with an explanation of the reason for imposing the more stringent standard.
3. This section shall not apply to proposed rules adopted by an agency to implement a statute that does not require an agency to interpret or describe the requirements of the statute such as federally mandated regulations which affords the agency no discretion to consider less restrictive alternatives.
620.054. 1. For any proposed rules that affect small business, the agency shall also submit a small business statement to the small business regulatory review board after the public hearing is held. This section shall not apply to emergency rules. The small business statement required by this section shall provide the following information:
(1) A description of how opinions or comments from affected small business were solicited, a summary of the public and small business comments, and a summary of the agency's response to those comments;
(2) The number of persons who:
(a) Attended the public hearing,
(b) Testified at the hearing, and
(c) Submitted written comments.
2. If there was a request to change the proposed rule at the hearing in a way that affected small business, a statement of the reasons for adopting the proposed rule without the requested change shall be included in the small business statement.
620.056. 1. There shall be established within the department of economic development a small business regulatory review board to consider any request from small business owners for review of any rule adopted by a state agency and to make recommendations to the agency or the general assembly regarding the need for a rule change or legislation. The establishment of the small business regulatory review board shall be a type I agency as defined in appendix B, RSMo.
2. The small business regulatory review board shall consist of thirteen members, who shall be appointed or serve by designation as follows:
(1) Four members to be appointed by the governor;
(2) Three members to be appointed by the lieutenant governor;
(3) One member to be appointed by the chairman of the committee in the house of representatives having jurisdiction over matters concerning small business;
(4) One member to be appointed by the chairman of the committee of the senate having jurisdiction over matters concerning small business;
(5) Two members to be appointed by the speaker of the house of representatives; and
(6) Two members to be appointed by the president pro tempore of the senate.
All nonlegislative appointments made pursuant to this subsection shall be made from a list of nominees, submitted to each appointing authority, by a nonprofit organization formed under the laws of this state the principal purpose of which is to function as a business membership service organization.
3. The appointments shall reflect representation of a variety of small businesses in the state, provided that no more than two members shall be representatives from the same type of small business.
4. All nonlegislative members of the small business regulatory review board shall be either a current or former owner or officer of a small business and shall not be an officer or employee of the federal, state, or county government. The governor shall appoint the initial chairperson of the board and a majority of the board shall elect subsequent chairpersons. The chairperson shall serve a term of not more than one year, unless removed earlier by a two-thirds vote of all members of the board.
5. A majority of all the members of the board shall constitute a quorum to do business and the concurrence of a majority of all the members of the board present and voting shall be necessary to make any action of the board valid.
6. In addition to any other powers provided by this act, the board may:
(1) Adopt any rules necessary to implement this act; and
(2) Do any and all things necessary to effectuate the purposes of this act.
620.058. 1. In addition to the basis for filing a petition provided in section 536.041, RSMo, any affected small business may file a written petition with the agency that has adopted rules objecting to all or part of any rule affecting small business on any of the following grounds:
(1) The actual effect on small business was not reflected in, or significantly exceeded, the small business impact statement submitted prior to the adoption of the rules;
(2) The small business impact statement did not consider new or significant economic information that reveals an undue impact on small business; or
(3) These impacts were not previously considered at the public hearing on the rules.
2. For rules adopted prior to the effective date of this act, an affected small business may file a written petition with the agency that adopted the rules objecting to all or part of any rules affecting small business on any of the following grounds:
(1) The rules created an undue barrier to the formation, operation, and expansion of small businesses in a manner that significantly outweighs its benefit to the public;
(2) The rules duplicate, overlap, or conflict with rules adopted by another agency or violate the substantive authority under which the rules were adopted; or
(3) The technology, economic conditions, or other relevant factors justifying the purpose for the rules have changed or no longer exist.
3. Upon submission of the petition, the agency shall forward a copy of the petition to the small business regulatory review board and the joint committee on administrative rules, as required by section 536.041, RSMo, as notification of a petition filed under this act. The agency shall promptly consider the petition and may seek advice and counsel regarding the petition. Within sixty days after the submission of the petition, the agency shall determine whether the impact statement or the public hearing addressed the actual and significant impact on small business. The agency shall submit a written response of the agency's determination to the small business regulatory review board within sixty days after receipt of the petition. If the agency determines that the petition merits the adoption, amendment, or repeal of a rule, it may initiate proceedings in accordance with the applicable requirements of chapter 536, RSMo.
4. If the agency determines that the petition does not merit the adoption, amendment, or repeal of any rule, any affected small business may seek a review of the decision by the small business regulatory review board. The board shall promptly convene a meeting for the purpose of soliciting testimony that will assist in its determination whether to recommend that the agency initiate proceedings in accordance with chapter 536, RSMo. For rules adopted after the effective date of this act, the board may base its recommendation on any of the following reasons:
(1) The actual effect on small business was not reflected in, or significantly exceeded, the impact statement submitted prior to the adoption of the rules;
(2) The impact statement did not consider new or significant economic information that reveals an undue impact on small business; or
(3) These impacts were not previously considered at the public hearing on the rules.
5. For rules adopted prior to the effective date of this act, the small business regulatory review board may base its recommendation to the agency on any of the following reasons:
(1) The rules created an undue barrier to the formation, operation, and expansion of small businesses in the state in a manner that significantly outweighs its benefit to the public;
(2) The rules duplicate, overlap, or conflict with rules adopted by another agency or violate the substantive authority under which the rules were adopted; or
(3) The technology, economic conditions, or other relevant factors justifying the purpose for the rules have changed or no longer exist.
6. If the small business regulatory review board recommends that an agency initiate rulemaking proceedings for any reason provided in subsections 4 or 5 of this section, it shall submit to the general assembly an evaluation report and the agency's response as provided in subsection 3 of this section. The general assembly may subsequently take such action in response to the evaluation report and the agency's response as it finds appropriate.
620.060. 1. Each agency having rules that affect small business in effect on the effective date of this act shall submit by June thirtieth of each odd-numbered year, a list of those rules to the small business regulatory review board. The agency shall also submit a report describing the specific public purpose or interest for adopting the respective rules and any other reasons to justify its continued implementation.
2. The small business regulatory review board shall provide to the head of each agency a list of any rules adopted by the agency that affect small business and have generated complaints or concerns, including any rules that the board determines may duplicate, overlap, or conflict with other rules, or exceed statutory authority. Within forty-five days after being notified by the board of the list, the agency shall submit a written report to the board in response to the complaints or concerns. The agency shall also state whether the agency has considered the continued need for the rules and the degree to which technology, economic conditions, and other relevant factors may have diminished or eliminated the need for maintaining the rules.
3. The board may solicit testimony from the public regarding any report submitted by the agency under this section at a public meeting. Upon consideration of any report submitted by an agency under this section and any public testimony, the small business regulatory review board shall submit an evaluation report to each regular session of the general assembly in even-numbered years. The evaluation report shall include an assessment as to whether the public interest significantly outweighs a rule's effect on small business and any legislative proposal to eliminate or reduce the effect on small business. The general assembly may take such action in response to the report as it finds appropriate.
620.062. 1. Except where a penalty is assessed pursuant to a program approved, authorized, or delegated under a federal law, any agency authorized to assess administrative penalties upon a small business shall waive or reduce any penalty as allowed by federal or state law for a violation of any statute or rules by a small business under the following conditions:
(1) The small business corrects the violation within a minimum of thirty days after receipt of a notice of violation or citation; and
(2) The violation was unintentional or the result of excusable neglect; or
(3) The violation was the result of an excusable misunderstanding of an agency's interpretation of a rule.
2. Subsection 1 of this section shall not apply when:
(1) A small business fails to exercise good faith in complying with the statute or rules;
(2) A violation is knowing or involves criminal conduct; and
(3) A violation results in serious health, safety, or environmental impact.