SB 0834 - Fiscal Note

Fiscal Note - SB 0834 - Procedure for agency rulemaking

COMMITTEE ON LEGISLATIVE RESEARCH

OVERSIGHT DIVISION

FISCAL NOTE

L.R. NO. 2976-01

BILL NO. SB 834

SUBJECT: State Departments: Administrative Rules

TYPE: Original

DATE: February 4, 1998

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FISCAL SUMMARY

ESTIMATED NET EFFECT ON STATE FUNDS
FUND AFFECTED	FY 1998	FY 1999	FY 2000
All State Funds	(Unknown)	(Unknown)	(Unknown)
Total Estimated Net Effect on All State Funds	(Unknown)	(Unknown)	(Unknown)

ESTIMATED NET EFFECT ON FEDERAL FUNDS
FUND AFFECTED	FY 1998	FY 1999	FY 2000
Total Estimated Net Effect on All Federal Funds	(Unknown)	(Unknown)	(Unknown)

ESTIMATED NET EFFECT ON LOCAL FUNDS
FUND AFFECTED	FY 1998	FY 1999	FY 2000
Local Government	$0	$0	$0

Numbers within parentheses: ( ) indicate costs or losses

This fiscal note contains 4 pages.

FISCAL ANALYSIS

Officials of the following agencies stated they would not be affected fiscally by this proposal or by an almost identical proposal from the 1997 legislative session: Lieutenant Governor, Attorney General, Tax Commission, Chief Clerk of the House, Secretary of the Senate, Auditor, Department of Higher Education, Linn State Technical College, University of Missouri, Truman State University, Highway Patrol, Capitol Police and Office of Prosecution Services.

Officials of the following agencies indicated that they were uncertain about the fiscal effects of the proposal: Department of Agriculture, Department of Revenue, Department of Labor and Industrial Relations, and Missouri Department of Conservation.

Officials of the Department of Elementary and Secondary Education estimated costs for hearings for twenty rules per year at $3,000 per year.

Officials of the Department of Insurance, in a response to a similar proposal, noted that the proposal would require agencies promulgating rules to issue them only on the basis of substantial evidence on the record after a public hearing. They would request a Legal Counsel to conduct about 140 hearings per year (four per proposed rule) to gather evidence on the record for proposed rules. Expenses would include costs for transcribing and recording evidence. Estimated costs to the Insurance dedicated Fund would be $85,752, $95,780 and $98,430 in FY's 99, 00 and 01, respectively.

Courts Administrator officials would expect a few cases of challenged rules to determine sufficiency of state agency compliance with this proposal, but would not expect enough cases to have a material effect on state courts.

Oversight assumes that the requirement for public hearings and the requirement that agencies determine the effectiveness and cost of rules to public or private entities affected by proposed rules would affect all state agencies which would promulgate rules. Oversight also assumes the effects would vary from agency to agency and year to year depending on laws passed and new rules required.

FISCAL IMPACT - State Government	FY 1998	FY 1999	FY 2000
	(10 Mo.)
ALL STATE AND FEDERAL FUNDS
Cost - Rules hearings and necessity
determinations	(Unknown)	(Unknown)	(Unknown)
FISCAL IMPACT - Local Government	FY 1998	FY 1999	FY 2000
	(10 Mo.)
	0	0	0
FISCAL IMPACT - Small Business

It is possible that small businesses would have less state agency rules due to this proposal; however, no direct fiscal effects are anticipated.

DESCRIPTION

This proposal would set requirements which would be met by officials of state agencies before they could promulgate administrative rules. Rules would not be more restrictive than necessary to carry out the purposes of statutes granting rule making authority. Officials could not issue rules except upon substantial evidence on the record after public hearing and a finding by agency officials that a proposed rule would be significant and necessary to carry out the purpose of the statute which granted rules authority.

This legislation is not federally mandated, would not duplicate any other program, would not require additional capital improvements or rental space, and would not affect total state revenue.

SOURCES OF INFORMATION

Department of Agriculture

Department of Elementary and Secondary Education

Department of Insurance

Department of Higher Education

Department of Labor and Industrial Relations

Department of Natural Resources

Department of Public Safety

Highway Patrol

Capitol Police

Department of Revenue

Missouri Department of Conservation

State Courts Administrator

State Tax Commission

State Prosecutor

House of Representatives

Senate

Attorney General

SOURCES OF INFORMATION (continued)

Lieutenant Governor

State Auditor

Truman State University

Linn State Technical College

University of Missouri

Jeanne Jarrett, CPA

Director

February 4, 1998