Ohio House Bill 11 (As Introduced)
Subject: Analysis of Proposed Changes to Ohio’s Administrative Rulemaking Process
1. Executive Summary:
Ohio House Bill 11 proposes significant changes to the state’s administrative rulemaking process, increasing legislative oversight and requiring greater transparency and fiscal analysis of proposed rules. The bill seeks to enhance the role of the Joint Committee on Agency Rule Review (JCARR), mandate legislative approval for certain rules with substantial economic impact, and ensure public access to agency policy documents. The overall aim appears to be to restrain agency power and increase accountability in the creation and enforcement of state regulations.
2. Main Themes and Key Provisions:
- Increased Legislative Oversight of Rules: The bill aims to strengthen the legislature’s power to review and potentially block administrative rules.
- Legislative Approval for Rules with Significant Economic Impact: A core provision of the bill requires legislative approval, via a separate law, for rules that meet certain economic thresholds. “This section applies to a proposed rule if the rule summary and fiscal analysis…estimate either of the following: (1) That the proposed rule will have an adverse impact on the economy of this state or a sector of the economy of this state in excess of five million dollars; (2) That the proposed rule will have an adverse impact on the economy of one or more political subdivisions of this state in excess of five million dollars in the aggregate.” (Lines 316-323) If these conditions are met, the agency cannot adopt the rule unless specifically authorized by law.
- Enhanced Role for JCARR: The bill expands the powers and responsibilities of the Joint Committee on Agency Rule Review (JCARR).
- Third-Party Fiscal Analysis: The chairperson of JCARR is granted the authority to request a third-party fiscal analysis of a rule, providing an independent assessment of its economic impact. “…a JCARR chairperson may request a third-party fiscal analysis of a rule…”
- Alternative Rule Summary and Fiscal Analysis: The Bill describes the process for requesting and approving an “alternative rule summary and fiscal analysis” (Lines 210-283), further empowering JCARR to scrutinize agency estimates.
- Increased Transparency and Public Access: The bill seeks to make agency policies and rules more accessible to the public.
- Public Posting of Policy Documents: The bill mandates that state agencies publicly post policy documents, increasing transparency and accountability. This is achieved by enacting section 121.96, which mandates public posting of “Guidance document[s]” which are defined as “a written principle of law or policy that has not been stated in a rule and that an agency is relying on in conducting adjudications or other determinations of rights and liabilities or in issuing writings and other materials.”
- Sunset Provisions for Rules Requiring Legislative Approval: The bill introduces a sunset clause for rules requiring legislative approval, mandating renewal every five years. “…a rule subject to, and adopted in accordance with, section 106.026 of the Revised Code expires on the date that is five years after the effective date of the law authorizing the rule’s adoption…” (Lines 390-393). This requires periodic review and reauthorization of significant regulations.
- Affirmative Defense in Rule Violation Cases: The bill creates an affirmative defense in cases where a person is accused of violating a rule, arguing that “a person of ordinary intelligence could not anticipate from the law purported to be the basis for the rule that the individual’s conduct would be unlawful.” (Lines 420-423)
- Regulatory Budgeting: The bill adds section 126.04 which institutes regulatory budgeting. This involves the director of budget and management publishing a unified regulatory agenda, listing actions under development. Each agency head must submit an agenda of regulatory and deregulatory actions, including objectives, legal authority, a cost/benefit analysis, a statement of need and economic impacts. Furthermore, the director must establish the annual regulatory budget, by specifying the net amount of incremental regulatory costs allowed at each state agency for the next fiscal year. State agencies should not take regulatory action unless they identify “at least one deregulatory action to offset the costs of the significant regulatory action.”
3. Specific Sections Amended/Enacted:
- Amends: 106.02, 106.023, 106.024, 111.15, 119.03, and 119.04 of the Revised Code
- Enacts: 106.025, 106.026, 106.033, 106.10, 121.96, and 126.04 of the Revised Code
4. Potential Implications:
- Slower Rulemaking Process: The increased legislative oversight and requirements for fiscal analysis could slow down the administrative rulemaking process, potentially delaying the implementation of new regulations.
- Reduced Agency Discretion: The bill would limit the ability of state agencies to enact rules without explicit legislative approval, shifting power towards the General Assembly.
- Increased Litigation: The affirmative defense provision could lead to increased litigation challenging the validity of administrative rules.
- Greater Scrutiny of Agency Actions: The enhanced role of JCARR and the requirement for public posting of policy documents would increase scrutiny of agency actions, promoting greater accountability.
5. Key Definitions:
- Rule: The bill uses the definition of “rule” as defined in section 111.15.
- Agency: The bill uses the definition of “agency” as defined in section 111.15.
6. Conclusion:
Ohio House Bill 11 represents a significant effort to reform the state’s administrative rulemaking process. By increasing legislative oversight, enhancing transparency, and requiring greater fiscal analysis, the bill seeks to ensure that state regulations are carefully considered, economically justified, and publicly accessible. However, the changes could also lead to a slower and more complex rulemaking process.