Second Regular Session Sixty-eighth General Assembly STATE OF COLORADO INTRODUCED LLS NO. 12-0499.01 Esther van Mourik x4215SENATE BILL 12-006 SENATE SPONSORSHIP Neville, HOUSE SPONSORSHIP Holbert, Senate Committees House Committees Business, Labor and Technology A BILL FOR AN ACT Concerning the creation of efficiencies in the state regulatory system. Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://www.leg.state.co.us/billsummaries.) The bill requires the committee on legal services to appoint a task force (COLS task force) to review the state's regulatory system and make recommendations related to whether: The current system creates a regulatory advantage to one segment of an industry at the expense of another; The existing availability of cost-benefit analysis needs strengthening in order to produce meaningful measures of adverse impacts on consumers and private industry; The enforcement practices of the current system, if any, create perverse incentives for unreasonably punitive fines and penalties on private parties; Economic conditions merit a downsizing of the regulatory body with resulting reduction of financial compliance costs; A particular regulated industry is regulated in an outmoded form of regulation that is no longer advisable; Currently regulated industries are regulated by other means; Continued regulation of the regulated industry is justified; The current system regulates fewer businesses than it did in a previous state fiscal year; and Compliance costs could be reduced or eliminated at no risk to the public welfare or environment and at no risk of creating or protecting a monopoly. The COLS task force must report to the committee on legal services by January 1, 2013, and the committee on legal services must then recommend to the general assembly such legislation regarding the findings and recommendations of the COLS task force as may be necessary. The bill also addresses the circumstances under which staff assistance will be available for the COLS task force. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. In Colorado Revised Statutes, add article 2.5 to title 24 as follows: ARTICLE 2.5 Efficiency in State Regulatory System 24-2.5-101. Definitions. As used in this article, unless the context otherwise requires: (1) "Committee on legal services" means the committee on legal services created in section 2-3-501, C.R.S. (2) "Executive branch departments" means all principal departments of the executive branch of state government as specified in section 24-1-110, including any division, office, agency, or other unit created within a principal department. (3) "Industry leader" means an executive-level employee or retiree of a large successful industry. (4) "Regulatory system" means the statutory system for rule-making by executive branch departments as specified in article 4 of this title, including all rules currently promulgated and published in the code of Colorado regulations. (5) "Small or medium business leader" means a successful business owner generally recognized in the business community with up to five hundred employees. (6) "Task force" means the committee on legal services task force created in section 24-2.5-102 (1). 24-2.5-102. Creating efficiencies in the state regulatory system. (1) There is hereby created the committee on legal services task force to study the state's regulatory system. The task force shall consist of fourteen members appointed as follows: (a) Ten members appointed no later than July 1, 2012, by the committee on legal services, four from each of the two major political parties with the greatest number of registered electors in the state and two unaffiliated registered electors. The ten members shall consist of: (I) Two private industry leaders; (II) Two small or medium business leaders; (III) Two members from organizations, institutes, corporations, or groups that conduct research and engage in advocacy in areas such as business policy or the economy; (IV) Two members, either academics from the economics, business, or law faculty of any public or private institution of higher education in this state who have experience related to public administration or regulatory compliance, or former employees of a state regulatory body with rule-making experience; and (V) Two people with significant project management experience. (b) Four former or current state legislators, appointed no later than July 1, 2012, as follows: (I) Two members of the senate, one appointed by the president of the senate and one appointed by the minority leader of the senate; and (II) Two members of the house of representatives, one appointed by the speaker of the house of representatives and one appointed by the minority leader of the house of representatives. (2) The task force shall designate one of the industry leaders and one of the small business leaders as chair and vice-chair. (3) The task force shall meet within thirty days after the committee on legal services appoints the members and shall meet additionally as convened by the chair. (4) The duties of the task force are to review the state's regulatory system and determine: (a) Whether the current system creates a regulatory advantage to one segment of an industry at the expense of another; (b) Whether the existing availability of a cost-benefit analysis, as defined in section 24-4-103 (2.5), needs strengthening in order to produce meaningful measures of adverse impacts on consumers and private industry; (c) Whether the enforcement practices of the current system, if any, create incentives for unreasonably punitive fines and penalties on private parties; (d) Whether economic conditions merit a downsizing of the regulatory body with resulting reduction of financial compliance costs; (e) Whether a particular regulated industry is regulated in an outmoded form of regulation that is no longer advisable; (f) Whether currently regulated industries are regulated by other means, including but not limited to federal regulatory systems; (g) Whether continued regulation of the regulated industry is justified, or whether there are adequate marketplace solutions to allow for the removal of current regulations, thereby resulting in cost savings; (h) Whether the current system regulates fewer businesses than it did in the 2008-09 state fiscal year; and (i) Whether credible testimony by regulated industries suggests that compliance costs could be reduced or eliminated at no risk to the public welfare or environment and at no risk of creating or protecting a monopoly. (5) (a) (I) The task force shall report in writing to the committee on legal services no later than January 1, 2013, January 1, 2014, and August 5, 2014, regarding its findings, recommendations, and estimated cost savings related to its duties specified in subsection (4) of this section. The report due on August 5, 2014, shall be the task force's final report and shall include final recommendations related to its duties specified in subsection (4) of this section. (II) The estimated cost savings shall include an analysis of savings to the regulatory agencies as well as to the regulated industries. The cost savings to regulated industries shall include an analysis of both estimated savings of direct costs such as regulatory fees as well as indirect compliance costs for the regulated industry. (b) Notwithstanding any other provision of law, the committee on legal services shall consider all recommendations, findings, and estimated cost savings made by the task force and shall recommend to the general assembly such legislation regarding the findings, recommendations, and estimated cost savings of the task force as may be necessary. (6) The members of the task force shall serve without compensation but may be reimbursed for all necessary and actual expenses incurred in the performance of their duties only if moneys are credited to the legislative department cash fund pursuant to paragraph (a) of subsection (8) of this section in an amount sufficient to fund such reimbursements. (7) The members of the task force may meet without any staff assistance described in subsection (8) of this section. (8) (a) The legislative council staff, on behalf of the task force, is authorized to receive federal moneys, contributions, grants, gifts, donations, services, and in-kind donations from any public or private entity for any direct or indirect costs associated with the duties of the task force set forth in this section. The legislative council staff shall transfer any moneys received pursuant to this paragraph (a) to the state treasurer, who shall credit the moneys to the legislative department cash fund created in section 2-2-1601, C.R.S., for use in implementing this section. (b) The director of research of the legislative council, the director of the office of legislative legal services, and the state auditor may supply staff assistance to the task force as they deem appropriate within existing appropriations. If staff assistance is not available within existing appropriations, then the director of research of the legislative council, the director of the office of legislative legal services, and the state auditor may supply staff assistance to the task force only if moneys are credited to the legislative department cash fund pursuant to paragraph (a) of this subsection (8) in an amount sufficient to fund staff assistance. The task force may also accept staff support from the private sector. (c) The costs of providing staff assistance to the task force by the director of research of the legislative council, the director of the office of legislative legal services, and the state auditor shall be approved by the chair of the legislative council and paid by vouchers and warrants drawn as provided by law from moneys continuously appropriated from the legislative department cash fund. (d) The committee on legal services shall perform the tasks assigned to it pursuant to this section within its existing appropriations and its normal meeting schedule. 24-2.5-103. Repeal of article. This article is repealed, effective January 1, 2015. SECTION 2. Safety clause. The general assembly hereby finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, and safety.