MISSISSIPPI LEGISLATURE

2014 Regular Session

To: Judiciary A

By: Representatives Turner, Barker, Boyd, Chism, Pigott, Staples

House Bill 1297

AN ACT TO AMEND SECTION 25-43-2.104, MISSISSIPPI CODE OF 1972, TO REVISE THE ADMINISTRATIVE PROCEDURES ACT; TO PROVIDE THAT AN AGENCY MAY ADOPT RULES PROVIDING FOR THE USE OF STREAMLINED PROCEEDINGS FOR A SMALL BUSINESS THAT IS INVOLVED IN AN ADJUDICATORY PROCEEDING BEFORE THE AGENCY; TO AMEND SECTIONS 25-43-1.102, 25-43-1.106, 25-43-2.103 AND 25-43-3.105, MISSISSIPPI CODE OF 1972, IN CONFORMITY TO THE PROVISIONS OF THIS ACT; TO BRING FORWARD SECTION 25-43-4.104, MISSISSIPPI CODE OF 1972, FOR PURPOSES OF POSSIBLE AMENDMENT; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 25-43-2.104, Mississippi Code of 1972, is amended as follows:

* * *

(1) In addition to other rule-making requirements imposed by law, each agency shall:

(a) Adopt as a rule a description of the organization of the agency which states the general course and method of its operations and where and how the public may obtain information or make submissions or requests;

(b) Adopt rules of practice setting forth the nature and requirements of all formal and informal proceedings available to the public.

(2) In addition to any other rule-making requirements pertaining to a small business, an agency may adopt rules providing that a small business may opt to participate in streamlined adjudicatory proceedings, to be conducted by remote means such as mail, electronic mail, telephone conference or videoconference, in lieu of a personal appearance. In adopting such rules, the agency shall:

(a) Consider the types of programs and issues for which such streamlined proceedings may reasonably be conducted, and limit the availability of streamlined proceedings to programs and issues in which the public interest in fair outcomes can continue to be assured, by taking into account the following:

(i) The complexity of the matters to be resolved in the proceeding;

(ii) The severity of potential sanctions;

(iii) Any necessity for personal appearances, including, but not limited to, requirements for sworn testimony or cross-examination; and

(iv) Any potential reduction in the costs and burdens of participating in the proceeding for the agency and for other parties.

(b) Ensure that a streamlined proceeding may only be used at the option of the respondent small business with the consent of the agency and any other necessary party to the proceeding, and that the rights of respondents and other parties will not be diminished in any respect by virtue of participation in a streamlined proceeding.

(d) Establish procedures for requesting, scheduling, conducting and developing a complete record of such proceedings.

(e) Provide that, if it becomes impractical or inappropriate to continue a proceeding as a streamlined proceeding, then the proceeding may be rescheduled as an adjudicatory proceeding under the agency's rules for same.

SECTION 2. Section 25-43-1.102, Mississippi Code of 1972, is amended as follows:

25-43-1.102. As used in this chapter, the following terms shall have the meanings ascribed to them in this section unless the context otherwise requires:

(a) "Agency" means a board, commission, department, officer or other administrative unit of this state, including the agency head, and one or more members of the agency head or agency employees directly or indirectly purporting to act on behalf or under the authority of the agency head. The term does not include the Legislature or any of its component units, the judiciary or any of its component units or the Governor. The term does not include a political subdivision of the state or any of the administrative units of a political subdivision. To the extent it purports to exercise authority subject to any provision of this chapter, an administrative unit otherwise qualifying as an "agency" must be treated as a separate agency even if the unit is located within or subordinate to another agency.

(b) "Agency head" or "head of the agency" means an individual or body of individuals in whom the ultimate legal authority of the agency is vested by any provision of law.

(i) A declaratory opinion pursuant to Section 25-43-2.103, or

(ii) A rule pursuant to Article III of this chapter.

(d) "Agency record" means the official rule-making record of an agency pursuant to Section 25-43-3.112.

(e) "Declaratory opinion" means an agency opinion rendered in accordance with the provisions of Section 25-43-2.103.

(f) "Order" means an agency action of particular applicability that determines the legal rights, duties, privileges, immunities or other legal interests of one or more specific persons. An order shall be in writing signed by a person with authority to render the order, or if more than one (1) person has such authority by at least that number of such persons as jointly have the authority to render the order, or by a person authorized to render the order on behalf of all such persons. The term does not include an executive order issued by the Governor pursuant to Section 25-43-1.104, an opinion issued by the Attorney General pursuant to Section 7-5-25, an opinion issued by the Ethics Commission pursuant to Section 25-4-17, or a declaratory opinion rendered in accordance with Section 25-43-2.103.

(g) "Person" means an individual, partnership, corporation, association, governmental subdivision or unit thereof, or public or private organization or entity of any character, and includes another agency.

(h) "Provision of law" or "law" means the whole or a part of the federal or state Constitution, or of any federal or state (i) statute, (ii) case law or common law, (iii) rule of court, (iv) executive order, or (v) rule or order of an administrative agency.

(i) "Rule" means the whole or a part of an agency regulation or other statement of general applicability that implements, interprets or prescribes:

(i) Law or policy, or

(ii) The organization, procedure or practice requirements of an agency. The term includes the amendment, repeal or suspension of an existing rule. "Rule" does not include:

1. A regulation or statement concerning only the internal management of an agency which does not directly and substantially affect the procedural or substantive rights or duties of any segment of the public;

2. A regulation or statement that establishes criteria or guidelines to be used by the staff of an agency in performing audits, investigations or inspections, settling commercial disputes, negotiating commercial arrangements or in the defense, prosecution or settlement of cases, if disclosure of the criteria or guidelines would:

a. Enable law violators to avoid detection;

b. Facilitate disregard of requirements imposed by law; or

c. Give a clearly improper advantage to persons who are in an adverse position to the state;

3. A regulation or statement that only establishes specific prices to be charged for particular goods or services sold by an agency;

4. A regulation or statement concerning only the physical servicing, maintenance or care of agency owned or operated facilities or property;

5. A regulation or statement relating only to the use of a particular facility or property owned, operated or maintained by the state or any of its subdivisions, if the substance of the regulation or statement is adequately indicated by means of signs or signals to persons who use the facility or property;

6. A regulation or statement directly related only to inmates of a correctional or detention facility, students enrolled in an educational institution or patients admitted to a hospital, if adopted by that facility, institution or hospital;

7. A form whose contents or substantive requirements are prescribed by rule or statute, and instructions for the execution or use of the form;

8. An agency budget;

9. A compact or agreement between an agency of this state and one or more agencies of another state or states; or

10. An opinion of the Attorney General pursuant to Section 7-5-25, an opinion of the Ethics Commission pursuant to Section 25-4-17, or an Executive Order of the Governor.

(j) "Rule-making" means the process for formulation and adoption of a rule.

(k) "Small business" is defined in Section 25-43-4.102.

SECTION 3. Section 25-43-1.106, Mississippi Code of 1972, is amended as follows:

* * *

(1) (a) Except as may otherwise be provided under Section 25-43-2.104, whenever, under this chapter, a party or any person is permitted or required to file with an agency any pleading, motion or other document, filing must be made by delivery of the document to the agency, by mailing it to the agency or by transmitting it to the agency by electronic means, including, but not limited to, facsimile transfer or e-mail. Filing by electronic means is complete when the electronic equipment being used by the agency acknowledges receipt of the material. If the equipment used by the agency does not automatically acknowledge transmission, service is not complete until the filing party obtains an acknowledgment from the agency. Filing by mail is complete upon receipt by the agency.

(b) The agency may implement this section by agency rule.

(2) Except as may otherwise be provided under Section 25-43-2.104, (a) Whenever service is required by this chapter, and whether the service is made by a party, an agency or a presiding officer, service of orders, notices, pleadings, motions and other documents upon a party shall be made by delivering a copy to the party, by transmitting it to the party by electronic means, including, but not limited to, facsimile transfer or e-mail, or by mailing it to the party at the party�s last known address. Delivery of a copy means handing it to a party, leaving it at the office of a party with a person in charge thereof, or leaving it at the dwelling house or usual place of abode of the party with some person of suitable age and discretion then residing therein. Service by electronic means is complete when the electronic equipment being used by the party being served acknowledges receipt of the material. If the equipment used by the party being served does not automatically acknowledge the transmission, service is not complete until the sending party obtains an acknowledgment from the recipient. Service by mail is complete upon mailing.

(b) Whenever service is required or permitted to be made upon a party who is represented by an attorney of record in the proceedings, the service shall be made upon such attorney.

(c) Whenever an agency issues an order or serves a notice or other document, the order or notice or other document shall be dated and shall be deemed to have been issued on the day it is served on the parties to the matter. If the order or notice or other document is to be served by mail, it shall be dated and shall be deemed to have been issued on the day it is mailed.

(3) Except as may otherwise be provided under Section 25-43-2.104, (a) In computing any period of time prescribed or allowed by this Article 1, by order of an agency, or by any applicable statute or agency rule, the day of the act, event or default from which the designated period of time begins to run shall not be included. The last day of the period so computed shall be included, unless it is a Saturday, a Sunday or a legal holiday, as defined by statute, or any other day when the agency�s office is in fact closed, whether with or without legal authority, in which event the period runs until the end of the next day which is not a Saturday, a Sunday, a legal holiday or any other day when the agency�s office is closed. When the period of time prescribed or allowed is less than seven (7) days, intermediate Saturdays, Sundays and legal holidays shall be excluded in the computation. In the event any legal holiday falls on a Sunday, the next following day shall be a legal holiday.

(b) Whenever a party has the right or is required to do some act or take some proceedings within a prescribed period after the service of a notice, order, pleading, motion or other paper upon him and the notice or paper is served upon him by mail, three (3) days shall be added to the prescribed period.

SECTION 4. Section 25-43-2.103, Mississippi Code of 1972, is amended as follows:

* * *

(1) Any person with a substantial interest in the subject matter may make a written request of an agency for a declaratory opinion as to the applicability to specified circumstances of a statute, rule or order within the primary jurisdiction of the agency. Such written request must clearly set forth the specific facts upon which an opinion is asked for and shall be limited to a single transaction or occurrence. An agency, through the agency head or its designee(s) by rule, shall issue a declaratory opinion in response to a written request for that opinion unless the agency determines that issuance of the opinion under the circumstances would be contrary to a rule adopted in accordance with subsection (2) of this section.

(2) Except as may otherwise be provided under Section 25-43-2.104, each agency shall issue rules that provide for: (a) the form, contents and filing of written requests for declaratory opinions; (b) the procedural rights of persons in relation to the written requests; and (c) the disposition of the written requests. Those rules must describe the classes of circumstances in which the agency will not issue a declaratory opinion.

(3) Within forty-five (45) days after receipt of a written request for a declaratory opinion, an agency, in writing, shall:

(a) Issue an opinion declaring the applicability of the statute, rule or order in question to the specified circumstances;

(b) Agree to issue a declaratory opinion by a specified time but no later than ninety (90) days after receipt of the written request; or

(4) A copy of all opinions issued in response to a written request for a declaratory opinion must be mailed promptly to the requesting person.

(5) (a) When any person receives a declaratory opinion from an agency and shall have stated all the facts to govern such opinion, the agency shall take no civil or criminal action against such person who, in good faith, follows the direction of such opinion and acts in accordance therewith unless a court of competent jurisdiction, after a full hearing, shall judicially declare that such opinion is manifestly wrong and without any substantial support. No declaratory opinion shall be given or considered if the opinion is requested after suit is filed or prosecution begun. Any declaratory opinion rendered pursuant to this chapter shall not be binding or effective for any third party or person other than the agency issuing the declaratory opinion and the person to whom the opinion is issued and shall not be used as precedent for any other transaction or occurrence beyond that set forth by the requesting person.

(b) The authority of persons to request and receive agency declaratory opinions in no way affects the ability of any person authorized by Section 7-5-25 to request a legal opinion from the Attorney General.

(c) Subject to any confidentiality provisions established by law, each agency shall make all declaratory opinions available for public inspection and copying and shall index them by name and subject, unless information contained within such opinions is confidential by statute or exempt from public disclosure pursuant to another provision of law.

(6) Without in any way limiting a person's right to request and receive a declaratory opinion under this section, or an agency's duty to issue a declaratory opinion under this section, nothing contained in this section shall prohibit an agency from providing informal responses or advice, orally or in writing, to any inquiries or requests for information submitted to the agency. Informal responses shall not be considered a declaratory opinion under this section.

SECTION 5. Section 25-43-3.105, Mississippi Code of 1972, is amended as follows:

[Through June 30, 2016, this section shall read as follows:]

25-43-3.105. (1) Prior to giving the notice required in Section 25-43-3.103, each agency proposing the adoption of a rule or amendment of an existing rule imposing a duty, responsibility or requirement on any person shall consider the economic impact the rule will have on the citizens of our state and the benefits the rule will cause to accrue to those citizens.

(2) Each agency shall prepare a written report providing an economic impact statement for the adoption of a rule or amendment to an existing rule imposing a duty, responsibility or requirement on any person. The economic impact statement shall include the following:

(a) The specific legal authority authorizing the promulgation of the rule * * *.;

(b) A description of:

(i) The need for the proposed action;

(ii) The benefits which will likely accrue as the result of the proposed action; and

(iii) The effect the proposed action will have on the public health, safety and welfare * * *.;

(c) An estimate of the cost to the agency, and to any other state or local government entities, of implementing and enforcing the proposed action, including the estimated amount of paperwork, and any anticipated effect on state or local revenues;

(d) An estimate of the cost or economic benefit to all persons directly affected by the proposed action;

(e) An analysis of the impact of the proposed rule on small business in the form of an economic impact statement as described in Section 25-43-4.104;

(f) A comparison of the costs and benefits of the proposed rule to the probable costs and benefits of not adopting the proposed rule or significantly amending an existing rule;

(g) A determination of whether less costly methods or less intrusive methods exist for achieving the purpose of the proposed rule where reasonable alternative methods exist which are not precluded by law;

(h) A description of reasonable alternative methods, where applicable, for achieving the purpose of the proposed action which were considered by the agency and a statement of reasons for rejecting those alternatives in favor of the proposed rule; and

(i) A detailed statement of the data and methodology used in making estimates required by this subsection.

(3) No rule or regulation shall be declared invalid based on a challenge to the economic impact statement for the rule unless the issue is raised in the agency proceeding. No person shall have standing to challenge a rule, based upon the economic impact statement or lack thereof, unless that person provided the agency with information sufficient to make the agency aware of specific concerns regarding the statement in an oral proceeding or in written comments regarding the rule. The grounds for invalidation of an agency action, based upon the economic impact statement, are limited to the agency's failure to adhere to the procedure for preparation of the economic impact statement as provided in this section, or the agency's failure to consider information submitted to the agency regarding specific concerns about the statement, if that failure substantially impairs the fairness of the rule-making proceeding.

(4) A concise summary and the full text of the economic impact statement must be properly filed with the Secretary of State for publication in the administrative bulletin and the period during which persons may make written submissions on the proposed rule shall not expire until at least twenty (20) days after the date of such proper filing.

(5) The properly filed summary of the economic impact statement must also indicate where, when and how persons may present their views on the proposed rule and demand an oral proceeding on the proposed rule if one is not already provided.

[From and after July 1, 2016, this section shall read as follows:]

25-43-3.105. (1) Prior to giving the notice required in Section 25-43-3.103, each agency proposing the adoption of a rule or significant amendment of an existing rule imposing a duty, responsibility or requirement on any person shall consider the economic impact the rule will have on the citizens of our state and the benefits the rule will cause to accrue to those citizens. For purposes of this section, a "significant amendment" means any amendment to a rule for which the total aggregate cost to all persons required to comply with that rule exceeds One Hundred Thousand Dollars ($100,000.00).

(2) Each agency shall prepare a written report providing an economic impact statement for the adoption of a rule or significant amendment to an existing rule imposing a duty, responsibility or requirement on any person, except as provided in subsection (7) of this section. The economic impact statement shall include the following:

(a) A description of the need for and the benefits which will likely accrue as the result of the proposed action;

(b) An estimate of the cost to the agency, and to any other state or local government entities, of implementing and enforcing the proposed action, including the estimated amount of paperwork, and any anticipated effect on state or local revenues;

(d) An analysis of the impact of the proposed rule on small business in the form of an economic impact statement as described in Section 25-43-4.104;

(e) A comparison of the costs and benefits of the proposed rule to the probable costs and benefits of not adopting the proposed rule or significantly amending an existing rule;

(f) A determination of whether less costly methods or less intrusive methods exist for achieving the purpose of the proposed rule where reasonable alternative methods exist which are not precluded by law;

(g) A description of reasonable alternative methods, where applicable, for achieving the purpose of the proposed action which were considered by the agency and a statement of reasons for rejecting those alternatives in favor of the proposed rule; and

(h) A detailed statement of the data and methodology used in making estimates required by this subsection.

(4) A concise summary of the economic impact statement must be properly filed with the Secretary of State for publication in the administrative bulletin and the period during which persons may make written submissions on the proposed rule shall not expire until at least twenty (20) days after the date of such proper filing.

(5) The properly filed summary of the economic impact statement must also indicate where persons may obtain copies of the full text of the economic impact statement and where, when and how persons may present their views on the proposed rule and demand an oral proceeding on the proposed rule if one is not already provided.

(6) If the agency has made a good-faith effort to comply with the requirements of subsections (1) and (2) of this section, the rule may not be invalidated on the ground that the contents of the economic impact statement are insufficient or inaccurate.

(7) This section does not apply to the adoption of:

(a) Any rule which is required by the federal government pursuant to a state/federal program delegation agreement or contract;

(b) Any rule which is expressly required by state law; and

SECTION 6. Section 25-43-4.104, Mississippi Code of 1972, is brought forward as follows:

25-43-4.104. (1) Prior to submitting proposed permanent rules for adoption, amendment, revision or revocation pursuant to the Mississippi Administrative Procedures Law, the agency shall comply with Section 25-43-3.105(2)(d) in order to determine whether the proposed rules affect small business by preparing an economic impact statement that includes the following:

(a) An identification and estimate of the number of small businesses subject to the proposed regulation;

(b) The projected reporting, recordkeeping and other administrative costs required for compliance with the proposed regulation, including the type of professional skills necessary for preparation of the report or record;

(d) A description of any less intrusive or less costly alternative methods of achieving the purpose of the proposed regulation, including the following regulatory flexibility analysis:

(i) The establishment of less stringent compliance or reporting requirements for small businesses;

(ii) The establishment of less stringent schedules or deadlines for compliance or reporting requirements for small businesses;

(iii) The consolidation or simplification of compliance or reporting requirements for small businesses;

(iv) The establishment of performance standards for small businesses to replace design or operational standards required in the proposed regulation; and

(v) The exemption of some or all small businesses from all or any part of the requirements contained in the proposed regulations.

(2) If the economic impact statement reflects that a proposed rule may have an economic effect upon small business, the agency shall submit a copy of the proposed rules and the economic impact statement to the committee for its review and comment pursuant to the review and comment provisions of the Mississippi Administrative Procedures Law. During the committee review process, the director or the director's designee of the promulgating agency shall be available at the request of the committee for comment on the proposed regulation.

(3) Within the review and comment period, if the committee determines that the proposed rules may have an economic effect upon small business, the committee may submit to the agency its comments concerning the proposed regulation including its specific recommendations.

(4) A small business that is affected or aggrieved by final agency action to enforce a rule or regulation is entitled to review of agency compliance with the requirements of this act.

(5) To ensure that any final rule continues to minimize economic impact on small businesses in a manner consistent with the stated objectives of applicable statutes, each agency shall, during any periodic review required by this chapter, consider the following factors:

(a) The continued need for the rule;

(b) The nature of complaints or comments received concerning the rule from the public;

(d) The extent to which the rule overlaps, duplicates, or conflicts with other federal, state and local governmental law or rules; and

(e) The length of time since the rule has been evaluated or the degree to which technology, economic conditions, or other factors have changed in the area affected by the rule.

SECTION 7. This act shall take effect and be in force from and after July 1, 2014.