GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1995

S	1 

SENATE BILL 1071

Short Title:  Common Sense Regulatory Commission.	(Public)

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Sponsors: Senator Perdue.

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Referred to:  Appropriations

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May 4, 1995

A BILL TO BE ENTITLED
AN ACT TO CREATE THE COMMON SENSE REGULATORY REVIEW COMMISSION, WHICH SHALL DEVELOP A NEW APPROACH TO STATE REGULATIONS IN NORTH CAROLINA AND SHALL DEVELOP A STRATEGY TO ESTABLISH AN ENVIRONMENT COMMISSION PATTERNED AFTER THE NORTH CAROLINA UTILITIES COMMISSION.
Whereas, North Carolinians agree on the need for a clean environment, safe workplaces, fair business practices, and safe and healthy children; and 
Whereas, North Carolinians do not agree on how to achieve these goals; and
Whereas, regulations to accomplish these goals have become more complex, more legalistic, more prescriptive, and less understandable to the average citizen and the arguments regarding regulations have become more continuous; and 
Whereas, growing animosity toward the cost and complexity of regulation and to the bureaucracies developed to promote and enforce regulations threatens to unravel the consensus on the goals themselves; and
Whereas, the correct place to focus this debate is on the regulatory apparatus, not on the goals; and
Whereas, we need a good dose of common sense in our regulatory process; and
Whereas, common sense solutions are possible; and
Whereas, what is needed in State government is a formal process to reassess the rule-making process and to review rules in all areas of State government; and
Whereas, applying common sense principles to regulation can reduce animosity toward the regulatory system, lower the costs of compliance, and provide better regulation rather than more regulation; and
Whereas, a Common Sense Regulatory Review Commission is needed to design a process to create this new kind of regulatory approach in North Carolina; and
Whereas, the goal of this act is to substitute a common sense approach for the current legalistic, rule-driven approaches to protect the environment, promote public health and safety, promote workplace safety, and promote fair business practice; Now, therefore,
The General Assembly of North Carolina enacts:
Section 1.  Commission Created. – The Common Sense Regulatory Review Commission is created.  The Commission shall consist of 15 members as follows:
(1)	Five members to be appointed by the President Pro Tempore of the Senate, three of whom shall be members of the Senate, one of whom shall be recognized as an environmentalist who is not a legislator nor a business person, and one of whom shall be a business person who is not a legislator nor an environmentalist.
(2)	Five members to be appointed by the Speaker of the House of Representatives, three of whom shall be members of the House of Representatives, one of whom shall be recognized as an environmentalist who is not a legislator nor a business person, and one of whom shall be a business person who is not a legislator nor an environmentalist.
(3)	Five members to be appointed by the Governor, two of whom shall be environmentalists who are not legislators nor business persons, two of whom shall be business persons who are not legislators nor environmentalists, and one of whom shall be a citizen who represents the general public.
Members appointed to the Commission shall serve until the Commission completes its tasks and submits a final report.  Vacancies in the Commission shall be filled by the same appointing officer who made the original appointments.
Sec. 2.  Review of Existing Rules. – The Common Sense Regulatory Review Commission shall complete a review of all rules in the North Carolina Administrative Code according to the following schedule:
(1)	For environmental rules, by May 1, 1996.
(2)	For agriculture rules and social services rules, by December 1, 1996.
(3)	For public health and safety rules, workplace rules, and business licensing rules, by May 1, 1997.
(4)	For all other rules, by May 1, 1998.
The Commission shall establish a process for reviewing all existing rules.
Sec. 3.  Common Sense Goals. – The Common Sense Regulatory Review Commission shall review Article 2A of Chapter 150B of the General Statutes, develop a strategy for rule making in the future, and establish a set of goals to accomplish prior to termination of the Commission.  The Commission shall consider for its goals any or all of the following:
(1)	To reduce the volume of rules by fifty percent (50%) over the next three years.
(2)	To reduce the costs of compliance with State regulations.
(3)	To assure that the benefits of rules outweigh the costs.
(4)	To reduce the time necessary to obtain permits by fifty percent (50%).
(5)	To increase public understanding and participation in the rule-making process.
(6)	To clarify expected outcomes for rules.
(7)	To improve public acceptance and approval of regulations.
(8)	To attempt to accomplish any other goal the Commission establishes.
Sec. 4.  The Ten Common Sense Rules. – The Common Sense Regulatory Review Commission shall develop a set of criteria to guide the review and proposed modification or repeal of existing rules and the proposed adoption of future rules.  The Commission shall consider for its criteria any or all of the following so-called Ten Common Sense Rules of Rule Making:
(1)	There is no better way of accomplishing the purpose of the proposed rule than by adopting the rule.
(2)	The proposed rule shall be based on the least amount of government intrusion necessary to accomplish a necessary purpose.
(3)	The proposed rule shall be written in plain language understandable to a high school graduate.
(4)	The proposed rule shall incorporate incentives for self-regulation and reporting of problems.
(5)	Any nonfederally mandated rule shall be subject to periodic sunset review.
(6)	The public shall have adequate advance notice of all proposed rule making.
(7)	The public and private cost of enforcement and compliance shall be outweighed by the benefit of the proposed rule.
(8)	Rules will not be based on the assumption that people and businesses are stupid and incapable of a reasonable degree of self-regulation.
(9)	To the extent possible, rules shall provide flexible means to meet proposed standards and shall not prescribe a precise method of meeting those standards.
(10)	There shall be adequate opportunity for education, comment, and participation in rule making by interested citizens.
Sec. 5.  Innovative Solutions. – The Common Sense Regulatory Review Commission shall consider methods to promote innovative solutions that lessen the need for rules.  The Commission may consider:
(1)	Developing a list of the top 10 most costly rules to implement.
(2)	Offering small incentive grants for research or demonstration projects to seek innovative solutions to achieve the purpose of a rule at less cost or complexity.
(3)	Encouraging the involvement of experts in science, technology, and public policy at the State universities and in the private sector.
(4)	Encouraging the joint efforts of the State universities and the private sector  to find innovative solutions to problems or incentives for particular behavior other than through rule making.
(5)	Establishing a revolving compliance fund consisting of low-interest loan funds to assist the regulated community in achieving compliance with rules.
Sec. 6.  Strategy to Develop Environment Commission. –   The Common Sense Regulatory Review Commission shall develop a strategy for the establishment of an Environment Commission, a commission with executive functions, patterned after the North Carolina Utilities Commission, to:
(1)	Replace all the commissions that exist within State government that have the authority to adopt rules affecting the environment, natural resources, or health-related environmental matters.
(2)	Balance the interests of environmental protection and economic development within the State.
(3)	Represent in its membership both environmental and economic assessment specialists.
(4)	Enhance the efficiency of the environmental regulatory process.
(5)	Serve as the single rule-making body regarding environment, natural resources, and health-related environmental matters.
(6)	Coordinate regulatory programs across a broad range of environmental policy.
(7)	Resolve disputes between a State agency and other persons through an administrative hearings process for contested cases.
(8)	Hear and decide all appeals of environmental permit decisions.
(9)	In conducting hearings, apply the rules of evidence applicable in civil actions in the superior court, insofar as practical; support its decisions by competent, material, and substantial evidence upon the consideration of the entire record; and provide for appeal to the North Carolina Supreme Court for cases involving rates and, for all other appeals of decision, provide for appeal directly to the North Carolina Court of Appeals.
(10)	Be exempt from Chapter 150B of the General Statutes.
(11)	Complete the consolidation of environmental regulatory programs by realigning the organization, powers, duties, and functions of the boards, commissions, and councils associated with the Department of Environment, Health, and Natural Resources.
(12)	Facilitate involvement by citizens who serve currently on environmental councils, boards, and other such bodies by creating two or three advisory councils in the areas of environment, health, and natural resources.
(13)	Consider restructuring the Department of Environment, Health, and Natural Resources to reflect the development of the Environment Commission.  
(14)	Consider the role, structure, and function of the staff of the Environment Commission and whether any staff of the Department of Environment, Health, and Natural Resources should be used to staff the Environment Commission.
Sec. 7.  Review of Existing Environmental Board and Commissions. –  The Common Sense Regulatory Review Commission shall review the following boards and commissions that currently address environmental matters to determine the desirability and feasibility of incorporating in the Environment Commission the powers, duties, and functions of:
(1)	Coastal Resources Commission.
(2)	Environmental Management Commission.
(3)	Commission for Health Services.
(4)	Marine Fisheries.
(5)	Mining Commission.
(6)	Sedimentation Control Commission.
(7)	Soil and Water Conservation Commission.
(8)	Water Pollution Control System Operators Certification Commission.
(9)	Water Treatment Facility Operators Board of Certification.
(10)	Wildlife Resources Commission.
(11)	Pesticide Board.
(12)	Structural Pest Control Committee.
Sec. 8.  Reports. – No later than April 1, 1996, the Common Sense Regulatory Review Commission shall report to the 1995 Session of the General Assembly (1996 Regular Session) by filing a report with the President Pro Tempore of the Senate and the Speaker of the House of Representatives.  This report shall include:
(1)	The results of its review of all environmental rules pursuant to Section 2 of this act and its recommendation for modifying or repealing any of those rules.
(2)	The strategy and recommendations regarding the establishment of the Environment Commission pursuant to Sections 6 and 7 of this act and legislative proposals to implement the strategy and these recommendations.
(3)	Proposed revisions to the current rule-making process consistent with its goals and criteria under Sections 3 and 4 of this act.
(4)	Any other matters the Commission determines necessary to report concerning its duties under this act.
The Commission shall report to the General Assembly annually thereafter its findings, recommendations, and proposals for legislation or rule changes with respect to its duties under this act and in accordance with the time schedule under Section 2 of this act.  If at any time during its deliberations, the Commission identifies a recommendation that can be implemented through the Administrative Procedures Act, Chapter 150B of the General Statutes, the Commission shall forward that recommendation with the proposed rule change to the responsible State agency for immediate consideration.  The Commission shall terminate December 31, 1998.
Sec. 9.  Commission Organization. –  The President Pro Tempore of the Senate and the Speaker of the House of Representatives each shall select a cochair of the Common Sense Regulatory Review Commission.  A majority of the Commission shall constitute a quorum for the transaction of business.  The Commission shall conduct its initial meeting no later than August 1, 1995.  Thereafter, the Commission shall meet as often as necessary to fulfill its duties, upon the joint call of the cochairs.  The Commission may contract for consultants or hire employees in accordance with G.S. 120-32.02.  The Legislative Services Commission, through the Legislative Administrative Officer, shall assign at least six members of the professional staff to assist the Commission in its work.  Upon the direction of the Legislative Services Commission, the Supervisors of Clerks of the Senate and of the House of Representatives shall assign clerical staff to the Commission.  The expenses for clerical employees shall be borne by the Commission.
The Commission may meet in the Legislative Building or the Legislative Office Building upon the approval of the Legislative Services Commission.  The Commission, while in the discharge of official duties, may exercise all the powers provided under the provisions of G.S. 120-19 through G.S. 120-19.4.
Sec. 10.  Expense of Members. –  Members of the Commission shall receive per diem, subsistence, and travel allowances as follows:
(1)	Commission members who are also General Assembly members, at the rate established in G.S. 120-3.1.
(2)	Commission members who are officials or employees of the State or local government agencies, at the rate established in G.S. 138-6.
(3)	All other Commission members, at the rate established in G.S. 138-5.
Sec. 11.  Appropriations. – (a) There is appropriated from the General Fund to the General Assembly the sum of seventy-five thousand dollars ($75,000) for the 1995-96 fiscal year and the sum of seventy-five thousand dollars ($75,000) for the 1996-97 fiscal year for the cost of staffing the Common Sense Regulatory Review Commission created in Section 1 of this act.
(b)	There is appropriated from the General Fund to the General Assembly the sum of one hundred fifty thousand dollars ($150,000) for the 1995-96 fiscal year and the sum of one hundred fifty thousand dollars ($150,000) for the 1996-97 fiscal year for all expenses, other than the costs of staffing the Common Sense Regulatory Review Commission created in Section 1 of this act.
Sec. 12.  This act becomes effective July 1, 1995.