HCS HB 322 -- SMALL BUSINESSES

SPONSOR:  St. Onge (Baker)

COMMITTEE ACTION:  Voted "do pass" by the Committee on Small
Business by a vote of 13 to 2.

This substitute requires state agencies to determine whether
proposed rules affect small businesses prior to submitting the
proposed rules for adoption, amendment, revision, or repeal.  If
they do, the agency must consider the practicality of less
restrictive alternatives that could be implemented to achieve the
same results as the proposed rule.  The agency must also consider
creative, innovative, or flexible methods of compliance for small
businesses and prepare a small business impact statement which
will be submitted with the proposed rules to the Small Business
Regulatory Fairness Board prior to providing notice of a public
hearing.  The substitute outlines the requirements of the impact
statement.

These requirements will not apply to federally mandated
regulations that afford the agency no discretion to consider less
restrictive alternatives.

For any proposed rules that affect small business, the agency
will also submit a small business statement to the board after a
public hearing is held.  The substitute outlines the requirements
of the statement.

The substitute establishes the Small Business Regulatory Fairness
Board within the Department of Economic Development.  The board
will work with agencies and small businesses on issues concerning
the impact of agency rules and regulations on small businesses.
The substitute outlines the membership of the board.

The substitute allows any affected small business to file a
written petition with the agency that has adopted rules,
including rules adopted prior to the substitute's effective date.
The substitute explains on what grounds a rule can be objected
to.  Upon submission of a written petition, the agency must
forward a copy of the petition to the board and to the Joint
Committee on Administrative Rules.  Within 60 days of the receipt
of the petition, the agency will determine whether the impact
statement or public hearing addressed the actual and significant
impact on small business and will submit a written response of
the agency's determination to the board.  Any small business may
appeal the agency's determination to the board.  The substitute
outlines the reasons on which the board may base its decision
regarding a small business appeal of the agency's determination.

The substitute requires each agency to submit to the General
Assembly and the board, by June 13 of each odd-numbered year, a
list of all rules which affect small business, a report
describing the specific public purpose or interest for adopting
each rule, and any other reasons that justify its continued
existence.  The General Assembly may take action in response to
the report as it finds appropriate.

The substitute requires the board to provide to the head of each
agency a list of any rules adopted by the agency that affect
small business and have generated complaints or concerns.
Forty-five days after being notified by the board of these rules,
the agency is required to submit a written report to the board in
response to the complaints or concerns.  The board may solicit
testimony at public meetings regarding any report submitted by an
agency.  The substitute requires the board to submit an
evaluation report to the Governor and the General Assembly
regarding these issues.

The substitute outlines occasions when an agency will waive or
reduce any administrative penalty or administrative fine for
violation of any statute, ordinance, or rule by a small business.
Small businesses that are adversely affected or aggrieved by the
final decision of an agency are entitled to judicial review of
the agency's compliance with the provisions of the substitute.
The small business can seek judicial review for a period of one
year, beginning on the date when the proposed rule becomes final.

FISCAL NOTE:  Estimated Net Cost to the General Revenue Fund of
$94,400 to Unknown in FY 2004, $100,006 to Unknown in FY 2005,
and $79,656 to Unknown in FY 2006.  Estimated Net Cost to Various
Other State Funds of Unknown in FY 2004, $63,968 to Unknown in FY
2005, and $57,132 to Unknown in FY 2006.

PROPONENTS:  Supporters say that the Small Business Regulatory
Fairness Board created by the bill will facilitate communication
and cooperation between state agencies and small businesses at
the beginning of the agency rule-making process.  This will
enable agencies and businesses to address problems with proposed
rules and regulations before they become effective.  Supporters
are concerned about the regulatory burdens faced by many small
businesses.  The provisions of the bill require agencies to take
small businesses into account when promulgating rules.  This
board will complement the Missouri Register and the existing
rule-making process.

Testifying for the bill were Representative Baker; Missouri
Chamber of Commerce; Associated Industries of Missouri; Missouri
Retailers Association; and National Federation of Independent
Businesses.

OPPONENTS:  There was no opposition voiced to the committee.

Amy Woods, Legislative Analyst

Missouri House of Representatives
Last Updated July 25, 2003 at 10:11 am