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<ns0:Id>20250AB__236699INT</ns0:Id>
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<ns0:Action>
<ns0:ActionText>INTRODUCED</ns0:ActionText>
<ns0:ActionDate>2026-02-19</ns0:ActionDate>
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<ns0:SessionYear>2025</ns0:SessionYear>
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<ns0:MeasureType>AB</ns0:MeasureType>
<ns0:MeasureNum>2366</ns0:MeasureNum>
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<ns0:AuthorText authorType="LEAD_AUTHOR">Introduced by Assembly Member Ávila Farías</ns0:AuthorText>
<ns0:Authors>
<ns0:Legislator>
<ns0:Contribution>LEAD_AUTHOR</ns0:Contribution>
<ns0:House>ASSEMBLY</ns0:House>
<ns0:Name>Ávila Farías</ns0:Name>
</ns0:Legislator>
</ns0:Authors>
<ns0:Title>An act to amend Sections 11346.3, 11346.5, 11349, 11349.1, and 11349.3 of, and to add Section 11346.37 to, the Government Code, relating to state government. </ns0:Title>
<ns0:RelatingClause>state government</ns0:RelatingClause>
<ns0:GeneralSubject>
<ns0:Subject>Administrative Procedure Act: proposed regulations: cost-of-living impact on residents of the state.</ns0:Subject>
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<ns0:DigestText>
<html:p>Existing law, the Administrative Procedure Act, governs the procedure for the adoption, amendment, or repeal of regulations by state agencies and for the review of those regulatory actions by the Office of Administrative Law. The act requires a state agency proposing to adopt, amend, or repeal any administrative regulation to assess the potential for adverse economic impact on California business enterprises and individuals and requires the state agency to adhere to specified requirements in making that assessment.</html:p>
<html:p>This bill would include among those requirements for assessing the potential for adverse economic impact the consideration of the proposal’s cost-of-living impacts on residents of the state, as defined.</html:p>
<html:p>Existing law requires a state agency proposing to adopt, amend, or repeal a regulation that
is not a major regulation to prepare an economic impact assessment that includes to what extent the regulation will affects specified factors, including the creation or elimination of jobs within the state. Existing law requires a state agency proposing to adopt, amend, or repeal a major regulation to prepare a standardized regulatory impact analysis that addresses specified factors, including the creation or elimination of jobs within the state.</html:p>
<html:p>This bill would also require the assessment for nonmajor regulations to include to what extent it will affect the cost-of-living impacts on residents of the state, and would require the standardized regulatory impact analysis for major regulations to address the cost-of-living impacts on residents of the state. The bill would require an agency to notify the office when the agency determines it needs to contract for outside services to perform the analyses and would require the office to select the contractor and oversee its
work. The bill would require the Legislative Analyst’s Office to adopt a standardized cost-of-living methodology for use by all agencies that includes a process for determining whether those cost-of-living impacts are significant. The bill would require each state agency to submit the standardized regulatory impact analysis to the Legislative Analyst’s Office, and would require the Legislative Analyst’s Office to take certain actions, including conducting an independent analysis of the adequacy of an agency’s economic analysis and an analysis of the cost-of-living impacts on residents of the state, and to provide its analysis to the state agency.</html:p>
<html:p>This bill would require the Department of Finance to develop and maintain a regulatory economic burden tracker that will gather and analyze the cumulative economic burden of regulations by sector of the economy. The bill would require the department to post the tracker on its internet website and update the tracker
annually.</html:p>
<html:p>Existing law requires the notice of proposed adoption, amendment, or repeal of a regulation to include, among other information, a statement of the results of the economic impact assessment and a summary of any comments submitted to the agency.</html:p>
<html:p>This bill would instead require the notice to include a detailed statement of the results of the economic impact assessment. The bill would require the summary of comments to include the Legislative Analyst’s Office comments and agency responses, as referenced above.</html:p>
<html:p>Existing law requires the office to review regulations and make determinations using specified standards, including, necessity, authority, and clarity.</html:p>
<html:p>This bill would add to those standards the cost-of-living impacts on residents of the state. The bill would require the office, in reviewing proposed regulations for
cost-of-living impacts on residents of the state, to use the standardized methodology developed by the Legislative Analyst’s Office.</html:p>
<html:p>Existing law requires the office to either approve a regulation or disapprove it within 30 working days after a regulation has been submitted to the office for review. Existing law requires the office, if it disapproves a regulation, to provide the adopting agency with a written notice detailing the reasons for disapproval.</html:p>
<html:p>This bill would, for major regulations, increase the period of time for approval or disapproval to 60 working days. The bill would require the office, for major regulations, to hold a public hearing within 30 working days after the regulation has been submitted to the office. If one of the reasons for disapproval includes a significant cost-of-living impact, the bill would require the agency to pursue a less costly alternative or explain why a less costly alternative is
infeasible.</html:p>
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<ns0:VoteRequired>MAJORITY</ns0:VoteRequired>
<ns0:Appropriation>NO</ns0:Appropriation>
<ns0:FiscalCommittee>YES</ns0:FiscalCommittee>
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<ns0:Election>NO</ns0:Election>
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<ns0:Preamble>The people of the State of California do enact as follows:</ns0:Preamble>
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<ns0:Num>SECTION 1.</ns0:Num>
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Section 11346.3 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
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<ns0:Num>11346.3.</ns0:Num>
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<html:p>
(a)
<html:span class="EnSpace"/>
A state agency proposing to adopt, amend, or repeal any administrative regulation shall assess the potential for adverse economic impact on California business enterprises and individuals, avoiding the imposition of unnecessary or unreasonable regulations or reporting, recordkeeping, or compliance requirements. For purposes of this subdivision, assessing the potential for adverse economic impact shall require agencies, when proposing to adopt, amend, or repeal a regulation, to adhere to the following requirements, to the extent that these requirements do not conflict with other state or federal laws:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
The proposed adoption, amendment, or repeal of a regulation shall be based on adequate information concerning the need for, and consequences of, proposed
governmental action.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The state agency, before submitting a proposal to adopt, amend, or repeal a regulation to the office, shall consider the proposal’s impact on business, with consideration of industries affected including the ability of California businesses to compete with businesses in other states. For purposes of evaluating the impact on the ability of California businesses to compete with businesses in other states, an agency shall consider, but not be limited to, information supplied by interested parties.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
The state agency, before submitting a proposal to adopt, amend, or repeal a regulation to the office, shall consider the proposal’s cost-of-living impacts on residents of the state.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
An economic impact assessment prepared pursuant to this subdivision for a proposed regulation that is not a major regulation or that is a major regulation proposed before November 1, 2013, shall be prepared in accordance with subdivision (b), and shall be included in the initial statement of reasons as required by Section 11346.2. An economic assessment prepared pursuant to this subdivision for a major regulation proposed on or after November 1, 2013, shall be prepared in accordance with subdivision (c), and shall be included in the initial statement of reasons as required by Section 11346.2.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
A state
agency proposing to adopt, amend, or repeal a regulation that is not a major regulation or that is a major regulation proposed before November 1, 2013, shall prepare an economic impact assessment that assesses whether and to what extent it will affect the following:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
The creation or elimination of jobs within the state.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
The cost-of-living impacts on residents of the state.
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
The creation of new businesses or the elimination of existing businesses within the state.
</html:p>
<html:p>
(D)
<html:span class="EnSpace"/>
The expansion of businesses currently doing business within the state.
</html:p>
<html:p>
(E)
<html:span class="EnSpace"/>
The benefits of the regulation to the health and welfare of California residents, worker safety, and the state’s environment.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
This subdivision does not apply to the University of California, the college named in Section 92200 of the Education Code, or the Fair Political Practices Commission.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Information required from a state agency for the purpose of completing the assessment may come from existing state publications.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
(A)
<html:span class="EnSpace"/>
For purposes of conducting the economic impact
assessment pursuant to this subdivision, a state agency may use the consolidated definition of small business in subparagraph (B) in order to determine the number of small businesses within the economy, a specific industry sector, or geographic region. The state agency shall clearly identify the use of the consolidated small business definition in its rulemaking package.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
For the exclusive purpose of undertaking the economic impact assessment, a “small business” means a business that is all of the following:
</html:p>
<html:p>
(i)
<html:span class="EnSpace"/>
Independently owned and operated.
</html:p>
<html:p>
(ii)
<html:span class="EnSpace"/>
Not dominant in its field of operation.
</html:p>
<html:p>
(iii)
<html:span class="EnSpace"/>
Has fewer than 100 employees.
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
Subparagraph (A) shall not apply to a regulation adopted
by the Department of Insurance that applies to an insurance company.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
Each state agency proposing to adopt, amend, or repeal a major regulation on or after November 1, 2013, shall prepare a standardized regulatory impact analysis in the manner prescribed by the Department of Finance pursuant to Section 11346.36. The standardized regulatory impact analysis shall address all of the following:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
The creation or elimination of jobs within the state.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
The cost-of-living impacts on residents of the state.
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
The creation of new businesses or the elimination of existing businesses within the state.
</html:p>
<html:p>
(D)
<html:span class="EnSpace"/>
The competitive advantages or disadvantages for businesses currently doing business within the state.
</html:p>
<html:p>
(E)
<html:span class="EnSpace"/>
The increase or decrease of investment in the state.
</html:p>
<html:p>
(F)
<html:span class="EnSpace"/>
The incentives for innovation in products, materials, or processes.
</html:p>
<html:p>
(G)
<html:span class="EnSpace"/>
The benefits of the regulations, including, but not limited to, benefits to the health, safety, and welfare of California residents, worker safety, and the state’s environment and quality of life, among any other benefits identified by the agency.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
This subdivision shall not apply to the University of California, the college named in Section 92200 of the Education Code, or the Fair Political Practices Commission.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Information required from state agencies for the purpose of completing the analysis may be derived from existing state, federal, or academic
publications.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
Any administrative regulation adopted on or after January 1, 1993, that requires a report shall not apply to businesses, unless the state agency adopting the regulation makes a finding that it is necessary for the health, safety, or welfare of the people of the state that the regulation apply to businesses.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
Analyses conducted pursuant to this section are intended to provide agencies and the public with tools to determine whether the regulatory proposal is an efficient and effective means of implementing the policy decisions enacted in statute or by other provisions of law in the least burdensome manner. Regulatory impact analyses shall inform the agencies and the public of the economic consequences of regulatory choices, not reassess statutory policy. The baseline for the regulatory analysis shall be the most cost-effective set of regulatory measures that are
equally effective in achieving the purpose of the regulation in a manner that ensures full compliance with the authorizing statute or other law being implemented or made specific by the proposed regulation.
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
When a state agency determines that it needs to contract for outside services in order to perform the analyses in this section, the agency shall notify the office and the office shall select the contractor and oversee its work.
</html:p>
<html:p>
(g)
<html:span class="EnSpace"/>
The Legislative Analyst’s Office shall adopt a standardized cost-of-living methodology for use by all agencies. The methodology shall also include a process for determining whether those cost-of-living impacts are significant.
</html:p>
<html:p>
(h)
<html:span class="EnSpace"/>
Each state agency proposing to adopt, amend, or repeal a major regulation on or after November 1, 2013, and that has prepared a standardized regulatory impact analysis pursuant to subdivision (c), shall submit that analysis to the Department of Finance upon completion. The department shall comment, within 30 days of receiving that analysis, on the extent to which the analysis adheres to the regulations adopted pursuant to Section 11346.36. Upon receiving the comments from the department, the agency may update its analysis to reflect any comments received from the department and shall summarize the comments and the response of the agency along with a statement of the results of the updated analysis
for the statement required by paragraph (10) of subdivision (a) of Section 11346.5.
</html:p>
<html:p>
(i)
<html:span class="EnSpace"/>
Each state agency proposing to adopt, amend, or repeal a major regulation and that has prepared a standardized regulatory impact analysis pursuant to subdivision (c) shall submit that analysis to the Legislative Analyst’s Office upon completion. The Legislative Analyst’s Office shall conduct an independent analysis of the adequacy of an agency’s economic analyses prepared pursuant to this section. The office shall also conduct its own analysis of the cost-of-living impacts on residents of the state of a proposed regulation. If the office finds that the cost-of-living impacts of a proposed regulation are significant, the office shall identify means by which the cost of the proposed regulation could be reduced. The Legislative Analyst’s Office shall provide its analysis and
comments on these items to the state agency within 60 days. Upon receiving the comments from the Legislative Analyst’s Office, the agency may update its analysis to reflect any revisions or comments received and shall summarize the comments and response of the agency along with a statement of the results of the updated analysis for the statement required by paragraph (10) of subdivision (a) of Section 11346.5.
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<ns0:Num>SEC. 2.</ns0:Num>
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Section 11346.37 is added to the
<ns0:DocName>Government Code</ns0:DocName>
,
<ns0:Positioning>immediately following Section 11346.36</ns0:Positioning>
, to read:
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<ns0:Num>11346.37.</ns0:Num>
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<html:p>
(a)
<html:span class="EnSpace"/>
The Department of Finance shall develop and maintain a regulatory economic burden tracker that will gather and analyze the cumulative economic burden of regulations by sector of the economy. The tracker shall integrate the regulatory costs across agencies that impact each sector.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
The department shall post the tracker on its internet website, and shall update the tracker on an annual basis.
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<ns0:Num>SEC. 3.</ns0:Num>
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Section 11346.5 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
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<ns0:Num>11346.5.</ns0:Num>
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<html:p>
(a)
<html:span class="EnSpace"/>
The notice of proposed adoption, amendment, or repeal of a regulation shall include the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
A statement of the time, place, and nature of proceedings for adoption, amendment, or repeal of the regulation.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Reference to the authority under which the regulation is proposed and a reference to the particular code sections or other provisions of law that are being implemented, interpreted, or made specific.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
An informative digest drafted in plain English in a format similar to the Legislative Counsel’s digest on legislative bills. The informative digest shall include the following:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
A concise and clear summary of existing laws and regulations, if any, related directly to the proposed action and of the effect of the proposed action.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
If the proposed action differs substantially from an existing comparable federal regulation or statute, a brief description of the significant differences and the full citation of the federal regulations or statutes.
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
A policy statement overview explaining the broad objectives of the regulation and the specific benefits anticipated by the proposed adoption, amendment, or repeal of a regulation, including, to the extent applicable, nonmonetary benefits such as the protection of public health and safety, worker safety, or the environment, the prevention of discrimination, the promotion of fairness or social equity, and the increase in openness and transparency
in business and government, among other things.
</html:p>
<html:p>
(D)
<html:span class="EnSpace"/>
An evaluation of whether the proposed regulation is inconsistent or incompatible with existing state regulations.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
Any other matters as are prescribed by statute applicable to the specific state agency or to any specific regulation or class of regulations.
</html:p>
<html:p>
(5)
<html:span class="EnSpace"/>
A determination as to whether the regulation imposes a mandate on local agencies or school districts and, if so, whether the mandate requires state reimbursement pursuant to Part 7 (commencing with Section 17500) of Division 4.
</html:p>
<html:p>
(6)
<html:span class="EnSpace"/>
An estimate, prepared in accordance with instructions adopted by the Department of Finance, of the cost or savings to any state agency, the cost to any local agency or school district that is required to be
reimbursed under Part 7 (commencing with Section 17500) of Division 4, other nondiscretionary cost or savings imposed on local agencies, and the cost or savings in federal funding to the state.
</html:p>
<html:p>For purposes of this paragraph, “cost or savings” means additional costs or savings, both direct and indirect, that a public agency necessarily incurs in reasonable compliance with regulations.</html:p>
<html:p>
(7)
<html:span class="EnSpace"/>
If a state agency, in proposing to adopt, amend, or repeal any administrative regulation, makes an initial determination that the action may have a significant, statewide adverse economic impact directly affecting business, including the ability of California businesses to compete with businesses in other states, it shall include the following information in the notice of proposed action:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
Identification of the types of businesses that would be
affected.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
A description of the projected reporting, recordkeeping, and other compliance requirements that would result from the proposed action.
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
The following statement: “The (name of agency) has made an initial determination that the (adoption/amendment/repeal) of this regulation may have a significant, statewide adverse economic impact directly affecting business, including the ability of California businesses to compete with businesses in other states. The (name of agency) (has/has not) considered proposed alternatives that would lessen any adverse economic impact on business and invites you to submit proposals. Submissions may include the following considerations:
</html:p>
<html:p>
(i)
<html:span class="EnSpace"/>
The establishment of differing compliance or reporting requirements or timetables that take into account the resources available to
businesses.
</html:p>
<html:p>
(ii)
<html:span class="EnSpace"/>
Consolidation or simplification of compliance and reporting requirements for businesses.
</html:p>
<html:p>
(iii)
<html:span class="EnSpace"/>
The use of performance standards rather than prescriptive standards.
</html:p>
<html:p>
(iv)
<html:span class="EnSpace"/>
Exemption or partial exemption from the regulatory requirements for businesses.”
</html:p>
<html:p>
(8)
<html:span class="EnSpace"/>
If a state agency, in adopting, amending, or repealing any administrative regulation, makes an initial determination that the action will not have a significant, statewide adverse economic impact directly affecting business, including the ability of California businesses to compete with businesses in other states, it shall make a declaration to that effect in the notice of proposed action. In making this declaration, the agency shall provide in the record facts, evidence, documents,
testimony, or other evidence upon which the agency relies to support its initial determination.
</html:p>
<html:p>An agency’s initial determination and declaration that a proposed adoption, amendment, or repeal of a regulation may have or will not have a significant, adverse impact on businesses, including the ability of California businesses to compete with businesses in other states, shall not be grounds for the office to refuse to publish the notice of proposed action.</html:p>
<html:p>
(9)
<html:span class="EnSpace"/>
A description of all cost impacts, known to the agency at the time the notice of proposed action is submitted to the office, that a representative private person or business would necessarily incur in reasonable compliance with the proposed action.
</html:p>
<html:p>If no cost impacts are known to the agency, it shall state the following:</html:p>
<html:p>“The agency is not aware of any cost
impacts that a representative private person or business would necessarily incur in reasonable compliance with the proposed action.”</html:p>
<html:p>
(10)
<html:span class="EnSpace"/>
A detailed statement of the results of the economic impact assessment required by subdivision (b) of Section 11346.3 or the standardized regulatory impact analysis if required by subdivision (c) of Section 11346.3, a summary of any comments submitted to the agency pursuant to subdivisions (h) and (i) of Section 11346.3 and the agency’s response to those comments.
</html:p>
<html:p>
(11)
<html:span class="EnSpace"/>
The finding prescribed by subdivision (d) of Section 11346.3, if
required.
</html:p>
<html:p>
(12)
<html:span class="EnSpace"/>
(A)
<html:span class="EnSpace"/>
A statement that the action would have a significant effect on housing costs, if a state agency, in adopting, amending, or repealing any administrative regulation, makes an initial determination that the action would have that effect.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
The agency officer designated in paragraph (14) shall make available to the public, upon request, the agency’s evaluation, if any, of the effect of the proposed regulatory action on housing costs.
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
The statement described in subparagraph (A) shall also include the estimated costs of compliance and potential benefits of a building standard, if any, that were included in the initial statement of reasons.
</html:p>
<html:p>
(D)
<html:span class="EnSpace"/>
For purposes of model codes adopted pursuant to Section 18928 of the
Health and Safety Code, the agency shall comply with the requirements of this paragraph only if an interested party has made a request to the agency to examine a specific section for purposes of estimating the costs of compliance and potential benefits for that section, as described in Section 11346.2.
</html:p>
<html:p>
(13)
<html:span class="EnSpace"/>
A statement that the adopting agency must determine that no reasonable alternative considered by the agency or that has otherwise been identified and brought to the attention of the agency would be more effective in carrying out the purpose for which the action is proposed, would be as effective and less burdensome to affected private persons than the proposed action, or would be more cost effective to affected private persons and equally effective in implementing the statutory policy or other provision of law. For a major regulation, as defined by Section 11342.548, proposed on or after November 1, 2013, the statement shall be based, in
part, upon the standardized regulatory impact analysis of the proposed regulation, as required by Section 11346.3, as well as upon the benefits of the proposed regulation identified pursuant to subparagraph (C) of paragraph (3).
</html:p>
<html:p>
(14)
<html:span class="EnSpace"/>
The name and telephone number of the agency representative and designated backup contact person to whom inquiries concerning the proposed administrative action may be directed.
</html:p>
<html:p>
(15)
<html:span class="EnSpace"/>
The date by which comments submitted in writing must be received to present statements, arguments, or contentions in writing relating to the proposed action in order for them to be considered by the state agency before it adopts, amends, or repeals a regulation.
</html:p>
<html:p>
(16)
<html:span class="EnSpace"/>
Reference to the fact that the agency proposing the action has prepared a statement of the reasons for the proposed action, has available all
the information upon which its proposal is based, and has available the express terms of the proposed action, pursuant to subdivision (b).
</html:p>
<html:p>
(17)
<html:span class="EnSpace"/>
A statement that if a public hearing is not scheduled, any interested person or
their duly authorized representative may request, no later than 15 days prior to the close of the written comment period, a public hearing pursuant to Section 11346.8.
</html:p>
<html:p>
(18)
<html:span class="EnSpace"/>
A statement indicating that the full text of a regulation changed pursuant to Section 11346.8 will be available for at least 15 days prior to the date on which the agency adopts, amends, or repeals the resulting regulation.
</html:p>
<html:p>
(19)
<html:span class="EnSpace"/>
A statement explaining how to obtain a copy of the final statement of reasons once it has been prepared pursuant to subdivision (a) of Section 11346.9.
</html:p>
<html:p>
(20)
<html:span class="EnSpace"/>
If the agency maintains an internet website
or other similar forum for the electronic publication or distribution of written material, a statement explaining how materials published or distributed through that forum can be accessed.
</html:p>
<html:p>
(21)
<html:span class="EnSpace"/>
If the proposed regulation is subject to Section 11346.6, a statement that the agency shall provide, upon request, a description of the proposed changes included in the proposed action, in the manner provided by Section 11346.6, to accommodate a person with a visual or other disability for which effective communication is required under state or federal law and that providing the description of proposed changes may require extending the period of public comment for the proposed action.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
The agency representative designated in paragraph (14) of subdivision (a) shall make available to the public upon request the express terms of the proposed action. The representative shall
also make available to the public upon request the location of public records, including reports, documentation, and other materials, related to the proposed action. If the representative receives an inquiry regarding the proposed action that the representative cannot answer, the representative shall refer the inquiry to another person in the agency for a prompt response.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
This section shall not be construed in any manner that results in the invalidation of a regulation because of the alleged inadequacy of the notice content or the summary or cost estimates, or the alleged inadequacy or inaccuracy of the housing cost estimates, if there has been substantial compliance with those requirements.
</html:p>
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<ns0:BillSection id="id_A1ED052E-9245-46F7-8673-297EF5260C76">
<ns0:Num>SEC. 4.</ns0:Num>
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Section 11349 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
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<ns0:LawSection id="id_59E0762E-8EEF-4AA0-8DE1-EDF0E055D61D">
<ns0:Num>11349.</ns0:Num>
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<ns0:Content>
<html:p>The following definitions govern the interpretation of this chapter:</html:p>
<html:p>
(a)
<html:span class="EnSpace"/>
“Necessity” means the record of the rulemaking proceeding demonstrates by substantial evidence the need for a regulation to effectuate the purpose of the statute, court decision, or other provision of law that the regulation implements, interprets, or makes specific, taking into account the totality of the record. For purposes of this standard, evidence includes, but is not limited to, facts, studies, and expert opinion.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
“Authority” means the provision of law which permits or obligates the agency to adopt, amend, or repeal a regulation.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
“Clarity” means written or displayed so that
the meaning of regulations will be easily understood by those persons directly affected by them.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
“Consistency” means being in harmony with, and not in conflict with or contradictory to, existing statutes, court decisions, or other provisions of law.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
“Reference” means the statute, court decision, or other provision of law which the agency implements, interprets, or makes specific by adopting, amending, or repealing a regulation.
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
“Nonduplication” means that a regulation does not serve the same purpose as a state or federal statute or another regulation. This standard requires that an agency proposing to amend or adopt a regulation must identify any state or federal statute or regulation which is overlapped or duplicated by the proposed regulation and justify any overlap or duplication. This standard is not
intended to prohibit state agencies from printing relevant portions of enabling legislation in regulations when the duplication is necessary to satisfy the clarity standard in paragraph (3) of subdivision (a) of Section 11349.1. This standard is intended to prevent the indiscriminate incorporation of statutory language in a regulation.
</html:p>
<html:p>
(g)
<html:span class="EnSpace"/>
“Cost-of-living impacts on residents of the state” means the cost of essentials and consumer staples, including, but not limited to, housing, transportation, food, taxes, and health care and the increase or decrease in these costs as a result of a proposed regulation in California both at the time of consideration and the foreseeable future.
</html:p>
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</ns0:BillSection>
<ns0:BillSection id="id_84601A57-3581-43CE-9E8B-2D6E47067DB4">
<ns0:Num>SEC. 5.</ns0:Num>
<ns0:ActionLine action="IS_AMENDED" ns3:href="urn:caml:codes:GOV:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2Fcaml%3ALawHeading%5B%40type%3D'TITLE'%20and%20caml%3ANum%3D'2.'%5D%2Fcaml%3ALawHeading%5B%40type%3D'DIVISION'%20and%20caml%3ANum%3D'3.'%5D%2Fcaml%3ALawHeading%5B%40type%3D'PART'%20and%20caml%3ANum%3D'1.'%5D%2Fcaml%3ALawHeading%5B%40type%3D'CHAPTER'%20and%20caml%3ANum%3D'3.5.'%5D%2Fcaml%3ALawHeading%5B%40type%3D'ARTICLE'%20and%20caml%3ANum%3D'6.'%5D%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'11349.1.'%5D)" ns3:label="fractionType: LAW_SECTION" ns3:type="locator">
Section 11349.1 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
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<ns0:Fragment>
<ns0:LawSection id="id_21F99E21-9806-4E76-BE00-223969096898">
<ns0:Num>11349.1.</ns0:Num>
<ns0:LawSectionVersion id="id_52D41BC1-12D8-4697-9AA9-1E5BE288549D">
<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
The office shall review all regulations adopted, amended, or repealed pursuant to the procedure specified in Article 5 (commencing with Section 11346) and submitted to it for publication in the California Code of Regulations Supplement and for transmittal to the Secretary of State and make determinations using all of the following standards:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
Necessity.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Authority.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Clarity.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
Consistency.
</html:p>
<html:p>
(5)
<html:span class="EnSpace"/>
Reference.
</html:p>
<html:p>
(6)
<html:span class="EnSpace"/>
Nonduplication.
</html:p>
<html:p>
(7)
<html:span class="EnSpace"/>
Cost-of-living impacts on residents of the state.
</html:p>
<html:p>In reviewing regulations pursuant to this section, the office shall restrict its review to the regulation and the record of the rulemaking proceeding. The office shall approve the regulation or order of repeal if it complies with the standards set forth in this section and with this chapter.</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
In reviewing proposed regulations for the criteria in subdivision (a), the office may consider the clarity of the proposed regulation in the context of related regulations already in existence. In addition, in reviewing the proposed regulations for cost-of-living impacts on residents of the state, the office shall use the standardized methodology developed by the Legislative Analyst’s Office
pursuant to subdivision (g) of Section 11346.3.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
The office shall adopt regulations governing the procedures it uses in reviewing regulations submitted to it. The regulations shall provide for an orderly review and shall specify the methods, standards, presumptions, and principles the office uses, and the limitations it observes, in reviewing regulations to establish compliance with the standards specified in subdivision (a). The regulations adopted by the office shall ensure that it does not substitute its judgment for that of the rulemaking agency as expressed in the substantive content of adopted regulations.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
The office shall return any regulation subject to this chapter to the adopting agency if any of the following occur:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
The adopting agency has not prepared the estimate
required by paragraph (6) of subdivision (a) of Section 11346.5 and has not included the data used and calculations made and the summary report of the estimate in the file of the rulemaking.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The agency has not complied with Section 11346.3. “Noncompliance” means that the agency failed to complete the economic impact assessment or standardized regulatory impact analysis required by Section 11346.3 or failed to include the assessment or analysis in the file of the rulemaking proceeding as required by Section 11347.3.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
The adopting agency has prepared the estimate required by paragraph (6) of subdivision (a) of Section 11346.5, the estimate indicates that the regulation will result in a cost to local agencies or school districts that is required to be reimbursed under Part 7 (commencing with Section 17500) of Division 4, and the adopting agency fails to do any of the
following:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
Cite an item in the Budget Act for the fiscal year in which the regulation will go into effect as the source from which the Controller may pay the claims of local agencies or school districts.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
Cite an accompanying bill appropriating funds as the source from which the Controller may pay the claims of local agencies or school districts.
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
Attach a letter or other documentation from the Department of Finance which states that the Department of Finance has approved a request by the agency that funds be included in the Budget Bill for the next following fiscal year to reimburse local agencies or school districts for the costs mandated by the regulation.
</html:p>
<html:p>
(D)
<html:span class="EnSpace"/>
Attach a letter or other documentation from the Department of Finance which
states that the Department of Finance has authorized the augmentation of the amount available for expenditure under the agency’s appropriation in the Budget Act which is for reimbursement pursuant to Part 7 (commencing with Section 17500) of Division 4 to local agencies or school districts from the unencumbered balances of other appropriations in the Budget Act and that this augmentation is sufficient to reimburse local agencies or school districts for their costs mandated by the regulation.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
The proposed regulation conflicts with an existing state regulation and the agency has not identified the manner in which the conflict may be resolved.
</html:p>
<html:p>
(5)
<html:span class="EnSpace"/>
The agency did not make the alternatives determination as required by paragraph (4) of subdivision (a) of Section 11346.9.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
The office shall notify the Department of
Finance of all regulations returned pursuant to subdivision (d).
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
The office shall return a rulemaking file to the submitting agency if the file does not comply with subdivisions (a) and (b) of Section 11347.3. Within three state working days of the receipt of a rulemaking file, the office shall notify the submitting agency of any deficiency identified. If no notice of deficiency is mailed to the adopting agency within that time, a rulemaking file shall be deemed submitted as of the date of its original receipt by the office. A rulemaking file shall not be deemed submitted until each deficiency identified under this subdivision has been corrected.
</html:p>
<html:p>
(g)
<html:span class="EnSpace"/>
Notwithstanding any other law, return of the regulation to the adopting agency by the office pursuant to this section is the exclusive remedy for a failure to comply with subdivision (c) of Section 11346.3 or paragraph (10) of
subdivision (a) of Section 11346.5.
</html:p>
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<ns0:Num>SEC. 6.</ns0:Num>
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Section 11349.3 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
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<ns0:LawSection id="id_8CC11486-8ADB-441B-ACEB-B49D840F7264">
<ns0:Num>11349.3.</ns0:Num>
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<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
The office shall either approve a regulation submitted to it for review and transmit it to the Secretary of State for filing or disapprove it within 30 working days after the regulation has been submitted to the office for review or 60 working days for major regulations. If the office fails to act within the specified time, the regulation shall be deemed to have been approved and the office shall transmit it to the Secretary of State for filing.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
For major regulations, the office shall hold a public hearing on the submitted regulation within 30 working days after the regulation has been submitted to the office for review. The office shall allow for public testimony and comment before the office acts on the regulation.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
If the office disapproves a regulation, it shall return it to the adopting agency within the time specified in subdivision (a) accompanied by a notice specifying the reasons for disapproval. Within seven calendar days of the issuance of the notice, the office shall provide the adopting agency with a written decision detailing the reasons for disapproval. If one of the reasons for disapproval includes a significant cost-of-living impact, the office shall then require the agency to pursue a less costly alternative or explain in detail why a less costly alternative is infeasible. No regulation shall be disapproved except for failure to comply with the standards set forth in Section 11349.1 or for failure to comply with this chapter.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
If an agency determines, on its own initiative, that a regulation submitted pursuant to subdivision (a) should be returned by the office prior to completion of the office’s review, it may request the return of the regulation. All requests for the return of a regulation shall be memorialized in writing by the submitting agency no later than one week following the request. Any regulation returned pursuant to this subdivision shall be resubmitted to the office for review within the one-year period specified in subdivision (b) of Section 11346.4 or shall comply with Article 5 (commencing with Section 11346) prior to resubmission.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
The office shall not initiate the return of a regulation pursuant to subdivision (d) as an alternative to disapproval pursuant to subdivision (c).
</html:p>
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