BILL ANALYSIS Ó Senate Appropriations Committee Fiscal Summary Senator Kevin de León, Chair AB 12 (Cooley) - Administrative Procedure Act: standardized regulatory impact analyses. Amended: May 24, 2013 Policy Vote: GO 11-0, EQ 9-0 Urgency: No Mandate: No Hearing Date: August 30, 2013 Consultant: Brendan McCarthy SUSPENSE FILE. Bill Summary: AB 12 would require the Department of Finance to annually review standardized regulatory analyses prepared by state agencies for adherence to state regulations. Fiscal Impact: Ongoing costs likely to be about $75,000 per year for the Department of Finance to review standardized regulatory analyses (General Fund). Given the anticipated workload (generally 5 - 10 qualifying analyses per year), staff believes the Department will likely need a partial position for these reviews. In some years, depending on workload and the complexity of the analysis, the Department may need additional, outside consultant services, at additional cost. Background: Under the Administrative Procedure Act, state agencies are generally required to adopt rules or guidelines as regulations, with specific procedures and analyses that must be undertaken by the state agency in that process. For example, current law requires state agencies proposing to adopt a regulation to assess the potential for adverse economic impacts due to the regulation. By November 1, 2013, the Department of Finance and the Office of Administrative Law are required to adopt regulations to guide other state agencies in conducting standardized regulatory impact analyses of proposed major regulations. (Major regulations are those with an anticipated impact of the state economy of more than $50 million.) The intent of this requirement is to improve the quality of the analysis of potential impacts of proposed regulations, by standardizing methods across state agencies. AB 12 (Cooley) Page 1 Current law requires the Department of Finance and the Office of Administrative Law to periodically review completed standardized regulatory impact analyses prepared by state agencies, to ensure that they are complying with the regulations to be adopted by the Department of Finance. Proposed Law: AB 12 would require the Department of Finance to annually review standardized regulatory analyses for adherence to state regulations. The bill would require the Office of Administrative Law to report to the Legislature regarding whether the standardized regulatory impact analyses conform to regulations. Related Legislation: AB 617 (Calderon and Pavley, Statutes of 2011) created the requirement that the Department of Finance adopt regulations to require standardized regulatory impact analysis.