Committee debates changes to 'major rule' process; executive branch urges caution

The Management Audit Committee spent much of its Aug. 20 meeting debating draft bill 27 LSO‑0113, a proposal that would change how the Legislature reviews "major" administrative rules and adjust what notice agencies must provide when they promulgate rules.

Josh Anderson of the Legislative Service Office walked the committee through changes that would require a new notice statement when an agency submits a rule and would alter the definition of "major rule," including lowering the economic-impact threshold and clarifying treatment of emergency and federally driven rules. "It requires that notice to include that if the rules are major rules as defined in statute, a statement that the rules are major rules, a statement of the need for the major rule, and any additional information necessary for the regulatory analysis," Anderson told the committee.

Matt Petri, administrator of LSO's Research and Evaluation Division, described the operational rollout for the new major‑rule screening. He said the screening tool is being used to identify rules that could meet the threshold and that LSO had already asked agencies to complete deeper surveys for rules that passed initial review. "Since July 1st, we have had seven proposed rules that have been noticed through the Secretary of State's office," Petri said, describing how the staff intake and screening process has worked in the first weeks.

But the governor's office raised concerns about new front‑end requirements. Betsy Anderson, deputy chief of staff and general counsel for Gov. Gordon, told the committee: "This would require an agency to self-identify…at the time they are filing with the Secretary of State for public comment," and warned that asking agency staff to make early economic judgments could be burdensome and misleading because many agency offices lack in-house economists. She and other executive‑branch witnesses supported the LSO staff language that preserves the management council's role as the body that formally designates whether a rule is major.

Committee members debated whether emergency rules and rules required by federal law should be exempt from the major‑rule process or subject to management council designation. Supporters of keeping management council involved argued the council can exercise discretion, including for emergency rules that have outsized effects. Opponents raised timing problems for agencies required to implement federal changes quickly.

The committee voted on several staff amendments during the meeting, including preserving management council discretion on designation and retaining the lower-dollar threshold in the staff draft. The committee advanced the bill as a management council-sponsored draft for further consideration.