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April 25, 2017Published Article

Joint Finance Committee Removes Administrative Law Proposals from Governor’s Budget Bill

Earlier this year, we reported on a few provisions in the governor’s proposed budget that would have made significant changes to Wisconsin’s administrative law process. Since then, however, the Joint Finance Committee voted to remove all of the non-fiscal policy provisions contained in the governor’s budget, including the proposed administrative law changes. Therefore, these provisions either need to be reintroduced separately as new budget amendments, or be introduced as separate legislation outside of the budget process.

For many years, it has been standard practice for governors from both parties to introduce budget bills that contain non-fiscal policy items. Some budget proposals have contained more non-fiscal policy items than others. Introducing such policies in the budget has often met resistance because, unlike other bills, the budget bill must be passed by the legislature and signed into law by the governor. Therefore, once a provision is included in the budget bill, it is typically difficult to get it removed. Very rarely has the legislature taken the step to remove all non-fiscal policy provisions from a governor’s budget.

One notable provision removed was the Regulations from the Executive in Need of Scrutiny Act, or REINS Act. Under this proposal, patterned after similar legislation at the federal level, a state administrative agency may not work on any proposed rule that will cost $10 million or more in implementation or compliance costs for businesses, local governments, and individuals over any two-year period until the rule is introduced as a bill, passes the legislature, and signed into law by the governor. The purpose of the proposal is to require the legislature and governor to approve costly administrative rules before the proposed rule can go into effect.

Rep. Adam Neylon (R-Pewaukee) and Sen. Devin LeMahieu have introduced the REINS Act as separate legislation (AB 42/SB 15). Last week, the Assembly Committee on Government Operations, Technology, and Consumer Protection held a public hearing on both bills. An amendment was introduced that would exempt any administrative rule by the Wisconsin Department of Natural Resources involving air quality if the following apply:

  • The rule is “necessary to comply with an explicit call for a state implementation plan” by the U.S. Environmental Protection Agency. 
  • Any standard, requirement, or limitation proposed in the rule is consistent with and not more stringent than what is required under the federal Clean Air Act.

Other non-fiscal policy administrative law provisions that were removed from the governor’s budget bill include the following:

  • Expedited procedure for repealing unauthorized rules: This provision allowed for an expedited procedure to repeal any administrative rules that a state agency no longer has the authority to promulgate because of the repeal or amendment of the law that previously authorized its promulgation.
  • Agency Guidance Documents: This provision made clear that an agency guidance document would not have the force of law and would not provide a state agency the authority to implement or enforce a standard, requirement, or threshold, including as a term or condition. The proposal would have also clearly defined the term, “guidance document.”

Another proposal that was removed from the governor’s budget was a study to determine whether to transfer regulation of concentrated animal feeding operations, or larger dairies, from the Department of Natural Resources to the Department of Agriculture, Trade, and Consumer Protection.

It remains to be seen whether these administrative law changes (other than the REINS Act) will be introduced as separate legislation, or if there is an attempt to have these provisions reinserted into the budget bill. Michael Best Strategies will continue to monitor the budget bill and provide further updates.

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