HCS HB 576 -- SMALL BUSINESS

SPONSOR:  Ervin (Flook)

COMMITTEE ACTION:  Voted "do pass" by the Committee on Small
Business by a vote of 10 to 0.

This substitute changes the laws regarding the Small Business
Regulatory Fairness Board and the procedures necessary for
obtaining judicial review of administrative decisions.

Currently, the board is allowed to conduct hearings and solicit
input from business owners regarding government agencies' rules
or proposed rules, after which the board provides input to the
agencies creating the rules.  The substitute requires, rather
than allows, the board to carry out these functions.

Currently, any person can petition an agency for the adoption,
amendment, or repeal of a rule.  The substitute requires the
agency to submit a written response to these petitions to the
board within 60 days of the receipt of the petition.  If the
agency determines that no change in a rule is needed, any small
business affected by the rule may seek a review by the board.

Each agency promulgating a rule that affects small business must
submit, every two years, a list of these rules to the General
Assembly and the board.  The agency must also submit reports
explaining why any rule should be continued.

Within 45 days of being notified by the board of a rule that has
generated complaints from small businesses, the agency must
submit a written response to the board.

The substitute grants any small business that is adversely
affected by a final agency action the right to sue in circuit
court for compliance with the procedures specified in the
substitute.  These suits must be commenced within one year of a
rule becoming final.

The substitute also specifies that if an agency fails to issue a
final decision on a contested case within either 60 days after
the conclusion of a hearing or within 180 days after the receipt
by the agency of a written request for the issuance of a final
decision, whichever time is earlier, the person is considered to
have exhausted all administrative remedies and is entitled to
judicial review in circuit court.  The court is allowed to
conduct a de novo review of the agency's decision upon
application of any party when the action of the agency under
review involves only the application of the law to the facts by
the agency.

FISCAL NOTE:  Estimated Cost on General Revenue Fund of Unknown
in FY 2006, FY 2007, and FY 2008.  Could exceed $100,000 per
year.  Estimated Cost on Other State Funds of Unknown in FY 2006,
FY 2007, and FY 2008.  Could exceed $100,000 per year.

PROPONENTS:  Supporters say that the bill gives small business an
opportunity to establish a dialogue with agencies that regulate
them, especially during the early stages of agency rulemaking.
The bill sets firm time frames for responding to small
businesses' concerns and allows judicial review of the process
itself, rather than delaying access to the courts until all
administrative remedies have been exhausted.  When there is a
material violation of the required procedures, the small business
can go to court to force the agency to follow the proper
procedure.  This is patterned after a federal law enacted in 1996
which led to better communication between business and regulatory
agencies.  Eventually, complaints about regulatory agencies
decreased substantially.

Testifying for the bill were Representative Flook; Scott George;
and National Federation of Independent Businesses.

OPPONENTS:  There was no opposition voiced to the committee.

Richard Smreker, Senior Legislative Analyst

Missouri House of Representatives
93rd General Assembly, 1st Regular Session
Last Updated August 25, 2005 at 1:19 pm