HOUSE BILL No. 2648
AN ACT concerning administrative rules and regulations; requirements for adoption of
rules and regulations; providing that agency adjudications shall not be used to
establish policies that are rules governing future private conduct that have the force
of law; relating to economic impact statements; requiring legislative ratification for
certain rules and regulations; requiring the director of the budget to review an
agency's determination of implementation and compliance costs and disapprove
proposed rules and regulations with incomplete or inaccurate economic impact
statements; removing a requirement that legislative post audit conduct an audit in
2026 pertaining to economic impact statements; amending K.S.A. 2023 Supp. 77-
415, 77-416 and 77-420 and repealing the existing sections.
Be it enacted by the Legislature of the State of Kansas:
New Section 1. (a) (1) If an economic impact statement required
by K.S.A. 77-420, and amendments thereto, or a revised economic
impact statement prepared pursuant to K.S.A. 77-416(b)(3), and
amendments thereto, indicates that $1,000,000 or more in
implementation and compliance costs are reasonably expected to be
incurred by or passed along to businesses, local governmental units and
individuals as a result of the proposed rule and regulation over the
initial five-year period following adoption of such rule and regulation,
the state agency proposing such rule and regulation shall not adopt such
rule and regulation unless such rule and regulation has been ratified by
the legislature. A proposed rule and regulation shall be deemed ratified
if a bill authorizing such rule and regulation is enacted by the
legislature. Any member of the legislature may introduce a bill
authorizing a state agency to adopt a rule and regulation that such
agency is prohibited from adopting under this subsection. The state
agency may resume adopting such proposed rule and regulation upon
enactment of a bill introduced under this subsection.
(b) If a state agency is prohibited from adopting a proposed rule
and regulation under subsection (a), such agency may modify the
proposed rule and regulation to lower the implementation and
compliance costs of the proposed rule and regulation. Any such
modification shall be germane to the subject of the proposed rule and
regulation. If a proposed rule and regulation is modified pursuant this
subsection, the state agency shall prepare a revised economic impact
statement pursuant to K.S.A. 77-416(b)(3), and amendments thereto. A
state agency may adopt such modified rule and regulation if the revised
economic impact statement indicates that $1,000,000 or more in
implementation and compliance costs are not reasonably expected to be
incurred by or passed along to businesses, local governmental units and
individuals as a result of the proposed rule and regulation over the
initial five-year period following adoption of such proposed rule and
regulation.
(c) The provisions of this section shall not apply to temporary
rules and regulations adopted pursuant to K.S.A. 77-722, and
amendments thereto, rules and regulations proposed because of a
federal mandate as described in K.S.A. 77-416(b)(1)(B), and
amendments thereto, or rules and regulations adopted pursuant to
K.S.A. 2-3710, and amendments thereto.
(d) This section shall be a part of and supplemental to the rules
and regulations filing act.
Sec. 2. K.S.A. 2023 Supp. 77-415 is hereby amended to read as
follows: 77-415. (a) K.S.A. 77-415 through 77-438 77-440 and section
1, and amendments thereto, shall be known and may be cited as the
rules and regulations filing act.
(b) (1) Unless otherwise provided by statute or constitutional
provision, each rule and regulation issued or adopted by a state agency
shall comply with the requirements of the rules and regulations filing
act. Except as provided in this section, any standard, requirement or
other policy of general application may be given binding legal effect
only if it has complied with the requirements of the rules and
regulations filing act.
(2) Notwithstanding the provisions of this section:
(A) An agency may bind parties, establish policies, and interpret
statutes or regulations by order in an adjudication under the Kansas HOUSE BILL No. 2648—page 2
administrative procedure act or other procedures required by law,
except that such policies shall not include the establishment of rules
governing future private conduct that have the force of law and such
order shall not be used as precedent in any subsequent adjudication
against a person who was not a party to the original adjudication unless
the order is:
(i) Designated by the agency as precedent;
(ii) not overruled by a court or later adjudication; and
(iii) disseminated to the public in one of the following ways:
(a) Inclusion in a publicly available index, maintained by the
agency and published on its website, of all orders designated as
precedent;
(b) publication by posting in full on an agency website in a format
capable of being searched by key terms; or
(c) being made available to the public in such other manner as
may be prescribed by the secretary of state.
(B) Any statement of agency policy may be treated as binding
within the agency if such statement of policy is directed to:(i) agency
personnel relating to the performance of their duties.(ii) or the
internal management of or organization of the agency. No such
statement of agency policy listed in clauses (i) and (ii) this
subparagraph may be relied on to bind the general public.
(C) An agency may provide forms, the content or substantive
requirements of which are prescribed by rule and regulation or statute,
except that no such form may give rise to any legal right or duty or be
treated as authority for any standard, requirement or policy reflected
therein.
(D) An agency may provide guidance or information to the public,
describing any agency policy or statutory or regulatory requirement
except that no such guidance or information may give rise to any legal
right or duty or be treated as authority for any standard, requirement or
policy reflected therein.
(E) None of the following shall be subject to the rules and
regulations filing act:
(i) Any policy relating to the curriculum of a public educational
institution or to the administration, conduct, discipline, or graduation of
students from such institution.
(ii) Any parking and traffic regulations of any state educational
institution under the control and supervision of the state board of
regents.
(iii) Any rule and regulation relating to the emergency or security
procedures of a correctional institution, as defined in K.S.A. 75-
5202(d), and amendments thereto.
(iv) Any order issued by the secretary of corrections or any
warden of a correctional institution under K.S.A. 75-5256, and
amendments thereto.
(F) When a statute authorizing an agency to issue rules and
regulations or take other action specifies the procedures for doing so,
those procedures shall apply instead of the procedures in the rules and
regulations filing act.
(c) As used in the rules and regulations filing act, and amendments
thereto, unless the context clearly requires otherwise:
(1) "Board" means the state rules and regulations board
established under the provisions of K.S.A. 77-423, and amendments
thereto.
(2) "Environmental rule and regulation" means:
(A) A rule and regulation adopted by the secretary of agriculture,
the secretary of health and environment or the state corporation
commission that has as a primary purpose the protection of the HOUSE BILL No. 2648—page 3
environment; or
(B) a rule and regulation adopted by the secretary of wildlife and
parks concerning threatened or endangered species of wildlife as
defined in K.S.A. 32-958, and amendments thereto.
(3) "Implementation and compliance costs" means direct costs
that are readily ascertainable based upon standard business practices,
including, but not limited to, fees, the cost to obtain a license or
registration, the cost of equipment required to be installed or used,
additional operating costs incurred, the cost of monitoring and
reporting and any other costs to comply with the requirements of the
proposed rule and regulation.
(4) "Person" means an individual, firm, association, organization,
partnership, business trust, corporation, company or any other legal or
commercial entity.
(4)(5) "Rule and regulation," "rule," and "regulation" means a
standard, requirement or other policy of general application that has the
force and effect of law, including amendments or revocations thereof,
issued or adopted by a state agency to implement or interpret
legislation.
(5)(6) "Rulemaking" means the same as defined in K.S.A. 77-602,
and amendments thereto.
(6)(7) "Small employer" means any person, firm, corporation,
partnership or association that employs not more than 50 employees,
the majority of whom are employed within this state.
(7)(8) "State agency" means any officer, department, bureau,
division, board, authority, agency, commission or institution of this
state, except the judicial and legislative branches, which is authorized
by law to promulgate rules and regulations concerning the
administration, enforcement or interpretation of any law of this state.
Sec. 3. K.S.A. 2023 Supp. 77-416 is hereby amended to read as
follows: 77-416. (a) Every state agency shall file with the secretary of
state every rule and regulation adopted by it and every amendment and
revocation thereof in the manner prescribed by the secretary of state.
Each rule and regulation shall include a citation to the statutory section
or sections being implemented or interpreted and a citation of the
authority pursuant to which it, or any part thereof, was adopted. Every
rule and regulation filed in the office of the secretary of state shall be
accompanied by a copy of the economic impact statement required by
subsection (b) and a copy of the environmental benefit statement if
required by subsection (d). A copy of any document adopted by
reference in a rule and regulation shall be available from the state
agency that adopted the rule and regulation upon request by any person
individual interested therein. The state agency, under the direction of
the secretary of state, shall number each section with a distinguishing
number and, in making a compilation of the rules and regulations, the
sections shall be arranged in numerical order. A decimal system of
numbering shall be prohibited.
(b) (1) At the time of drafting a proposed rule and regulation or
amendment to an existing rule and regulation, the state agency shall
consider the economic impact of the proposed rule and regulation. The
state agency shall prepare an economic impact statement that shall
include:
(A) An analysis, brief description, and cost and benefit
quantification of the proposed rules and regulations and what is
intended to be accomplished by their adoption. If the approach chosen
by the Kansas agency to address the policy issue is different from that
utilized by agencies of contiguous states or of the federal government,
the economic impact statement shall include an explanation of why the
Kansas agency's rule and regulation differs; HOUSE BILL No. 2648—page 4
(B) whether the proposed rule and regulation is mandated by
federal law as a requirement for participating in or implementing a
federally subsidized or assisted program and whether the proposed
rules and regulations exceed the requirements of applicable federal law;
(C) an analysis specifically addressing the following factors:
(i) The extent to which the rule and regulation will enhance or
restrict business activities and growth;
(ii) the economic effect, including a detailed quantification of
implementation and compliance costs, on the specific businesses,
business sectors, public utility ratepayers, individuals and local
governmental units that will be affected by the proposed rule and
regulation and on the state economy as a whole;
(iii) the businesses that would be directly affected by the proposed
rule and regulation;
(iv) the benefits of the proposed rule and regulation compared to
the cost;
(v) measures taken by the agency to minimize the cost and impact
of the proposed rule and regulation on business and economic
development within the state of Kansas, local government and
individuals; and
(vi) an estimate of the total annual implementation and
compliance costs that are reasonably expected to be incurred by or
passed along to businesses, local governmental units or members of the
public individuals and a determination of whether those costs will
exceed $1,000,000 over any two-year the initial five-year period from
the effective date of this act through June 30, 2024, or exceed
$3,000,000 over any two-year period on and after July 1, 2024
following adoption of the proposed rule and regulation.
(2) The state agency shall consult with the league of Kansas
municipalities, Kansas association of counties and the Kansas
association of school boards, as appropriate, when preparing the
economic impact statement of a proposed rule and regulation which
increases or decreases revenues of cities, counties or school districts or
imposes functions or responsibilities on cities, counties or school
districts that will increase their expenditures or fiscal liability. The
agency shall consult and solicit information from businesses, business
associations, local governmental units, state agencies or institutions and
members of the public that may be affected by the proposed rule and
regulation or that may provide relevant information.
(3) As required pursuant to the provisions of K.S.A. 77-420(d),
and amendments thereto, the state agency shall reevaluate and, when
necessary, update the economic impact statement when directed to do
so by the director of the budget and, if approved by the director of the
budget, shall submit the revised economic impact statement at the time
of filing a rule and regulation with the secretary of state. If a public
hearing was held prior to the adoption of the rule and regulation, a state
agency at the time of filing a rule and regulation with the secretary of
state shall include as a part of the economic impact statement a
statement specifying the time and place at which the hearing was held
and the attendance at the hearing. A copy of the current economic
impact statement shall be available from the state agency upon request
by any party interested therein.
(4) The implementation and compliance costs determined under
subsection (b)(1)(C)(vi) shall be those additional costs reasonably
expected to be incurred and shall be separately identified for the
affected businesses, local governmental units and members of the
public individuals. In determining total additional costs of such
proposed rules and regulations, the state agency shall not account for
any actual or estimated cost savings that may be realized by the HOUSE BILL No. 2648—page 5
implementing state agency, local government or by members of the
public individuals.
(c) Pursuant to the provisions of K.S.A. 77-420, and amendments
thereto, the director of the budget shall review the economic impact
statement prepared by any state agency and shall prepare a
supplemental or revised statement and an independent analysis by the
director of the budget of the cost and the factors as set forth in
subsection (b)(1)(A) and (C) and subsection (e). If possible, the
supplemental or revised statement shall include a reliable estimate in
dollars of the anticipated change in revenues and expenditures of the
state. It also shall include a statement, if determinable or reasonably
foreseeable, of the immediate and long-range economic impact of the
rule and regulation upon persons individuals subject thereto, small
employers and the general public. If, after careful investigation, it is
determined that no dollar estimate is possible, the statement shall set
forth the reasons why no dollar estimate can be given. Every state
agency is directed to cooperate with the division of the budget in the
preparation of any statement pursuant to this subsection when, and to
the extent, requested by the director of the budget. The director of the
budget shall follow the procedures set forth in K.S.A. 77-420, and
amendments thereto, in evaluating and accepting or rejecting the
proposed rule and regulation. No agency shall submit a rule and
regulation to the secretary of state for filing before receiving the
approval of the director of the budget as provided in this subsection and
K.S.A. 77-420, and amendments thereto.
(d) At the time of drafting a proposed environmental rule and
regulation or amendment to an existing environmental rule and
regulation, the state agency shall consider the environmental benefit of
such proposed rule and regulation or amendment. Prior to giving notice
of a hearing on a proposed rule and regulation, the state agency shall
prepare an environmental benefit statement that shall include a
description of the need for and the environmental benefits that will
likely accrue as the result of the proposed rule and regulation or
amendment. The description shall summarize, when applicable,
research indicating the level of risk to the public health or the
environment being removed or controlled by the proposed rule and
regulation or amendment. When specific contaminants are to be
controlled by the proposed rule and regulation or amendment, the
description shall indicate the level at which the contaminants are
considered harmful according to currently available research. The state
agency may consult with other state agencies when preparing the
environmental benefit statement. The state agency shall reevaluate and,
when necessary, update the statement at the time of filing a rule and
regulation with the secretary of state. A copy of the current
environmental benefit statement shall be available from the state
agency upon request by any party interested therein.
(e) In addition to the requirements of subsection (b), the economic
impact statement for all environmental rules and regulations shall
include:
(1) A description of the capital and annual costs of compliance
with the proposed rules and regulations, and the persons individuals or
entities who will bear those costs;
(2) a description of the initial and annual costs of implementing
and enforcing the proposed rules and regulations, including the
estimated amount of paperwork, and the state agencies, other
governmental agencies or other persons individuals or entities who will
bear the costs;
(3) a description of the costs that would likely accrue if the
proposed rules and regulations are not adopted, the persons individuals HOUSE BILL No. 2648—page 6
or entities who will bear the costs and those who will be affected by the
failure to adopt the rules and regulations; and
(4) a detailed statement of the data and methodology used in
estimating the costs used in the statement.
(f) In 2026, the legislative post audit committee shall direct the
legislative division of post audit to conduct an audit to study:
(1) The accuracy of economic impact statements submitted by
state agencies pursuant to this section for the immediately preceding
seven years;
(2) the impact the review by the director of the budget has had on
the accuracy of economic impact statements submitted by state
agencies pursuant to this section; and
(3) whether the $1,000,000 or $3,000,000 cost figure is the
appropriate amount of economic impact to trigger the hearing
procedure required by K.S.A. 77-420(a), and amendments thereto.
Sec. 4. K.S.A. 2023 Supp. 77-420 is hereby amended to read as
follows: 77-420. (a) (1) Except as further provided by this subsection,
Every rule and regulation proposed to be adopted by any state agency,
after being submitted to the secretary of administration and the attorney
general as required by this section, shall be submitted with the
economic impact statement for the rule and regulation required by
K.S.A. 77-416, and amendments thereto, to the director of the budget
for review of the accuracy and completeness of the agency's economic
impact statement. The director of the budget shall review the agency's
determination of the amount of implementation and compliance costs
reasonably expected to be incurred by or passed along to businesses,
local government and individuals over the initial five-year period
following adoption and shall conduct an independent analysis to
determine that the agency has complied with the requirements for the
economic impact statement set forth in K.S.A. 77-416(b)(1)(A) and (b)
(1)(C) and (e), and amendments thereto. Every rule and regulation
requiring approval by the director of the budget shall be stamped as if
approved, and the date of approval shall be indicated.
(2) If the agency director independently determines that a
proposed rule and regulation submitted or resubmitted by the agency
will not result in implementation or compliance costs of more than
$1,000,000 from the effective date of this act through June 30, 2024, or
more than $3,000,000 on and after July 1, 2024, for businesses, local
government or individuals in any two-year the initial five-year period
following adoption of such rule and regulation, the agency shall
provide a copy of the economic impact statement to the director, but the
director shall not be required to review or approve the proposed rule
and regulation the director shall:
(A) Approve the rule and regulation if the director independently
determines that the economic impact statement, demonstrates a
complete analysis as required by K.S.A. 77-416(b)(1)(A) and (b)(1)(C)
and (e), and amendments thereto, and the director concurs with the
economic impact statement; or
(B) disapprove the rule and regulation if the economic impact
statement is incomplete or contains substantive inaccuracies.
(3) If the agency director of the budget determines that the
proposed rule and regulation will result in implementation and
compliance costs of more than $1,000,000 from the effective date of
this act through June 30, 2024, or more than $3,000,000 on and after
July 1, 2024, for businesses, local government or individuals in any
two-year the initial five-year period following adoption of such rule
and regulation, the director of the budget shall:
(A) Approve the proposed rule and regulation, if:
(1) The proposed rule and regulation has been ratified by the HOUSE BILL No. 2648—page 7
legislature pursuant to section 1, and amendments thereto; and
(2) the agency, prior to the submission or the resubmission of a
rule and regulation to the director, holds a public hearing and finds that
the costs of the proposed rule and regulation have been accurately
determined and are necessary for achieving legislative intent and the
director, after an independent analysis, concurs with the agency's
findings and analysis and approves the economic impact statement. An
agency's public hearing may be held prior to or after ratification by the
legislature; or
(B) disapprove the proposed rule and regulation if the economic
impact statement is incomplete or contains substantive inaccuracies.
(4) If an agency is proposing a rule and regulation because of a
federal mandate as described in K.S.A. 77-416(b)(1)(B), and
amendments thereto, the agency shall provide a copy of the economic
impact statement to the director, but the director shall not be required to
review or approve the proposed rule and regulation, regardless of the
implementation and compliance cost of the proposed rule and
regulation.
(5) For the purposes of this subsection, the implementation and
compliance cost shall be calculated from the effective date of the rule
and regulation.
(b) The director of the budget shall submit an annual report to the
legislature and to the joint committee on administrative rules and
regulations on the first day of the 2019 regular legislative session and
subsequent regular legislative sessions on all rules and regulations
approved or denied by the director. The report shall include the text of
each rule and regulation reviewed, the final economic impact statement
and a summary of the director's analysis supporting the decision to
approve or reject the rule and regulation. The director shall
immediately submit a separate report to the legislature, if in session,
and the joint committee on administrative rules and regulations upon
the approval or denial of a rule or regulation with costs determined to
be greater than $1,000,000 from the effective date of this act through
June 30, 2024, or greater than $3,000,000 on and after July 1, 2024, for
businesses, local government or individuals over any two-year the
initial five-year period following adoption of such rule and regulation.
The report shall include an analysis of the agency's and the director's
decisions with respect to the necessity of the cost of the rule and
regulation to achieve legislative intent.
(c) Every rule and regulation proposed to be adopted by any state
agency, before being submitted to the attorney general and the director
of the budget as required under this section, shall be submitted to the
secretary of administration for approval of its organization, style,
orthography and grammar subject to such requirements as to
organization, style, orthography and grammar as the secretary may
adopt. Every rule and regulation submitted to the secretary of
administration under this subsection shall be accompanied by a copy of
any document which that is adopted by reference by the rule and
regulation. Every rule and regulation approved by the secretary of
administration under this subsection shall be stamped as approved and
the date of such approval shall be indicated therein.
(d) Every rule and regulation proposed by any state agency that
has been approved by the secretary of administration as provided in
subsection (c), before being submitted to the director of the budget as
required under this section, shall be submitted to the attorney general
for an opinion as to the legality of the same, including whether the
making of such rule and regulation is within the authority conferred by
law on the state agency. The attorney general shall promptly furnish an
opinion as to the legality of the proposed rule and regulation so HOUSE BILL No. 2648—page 8
submitted. Every rule and regulation submitted to the attorney general
under this subsection shall be accompanied by a copy of any document
which is adopted by reference by the rule and regulation. Every rule
and regulation approved by the attorney general under this subsection
shall be stamped as approved and the date of such approval shall be
indicated therein.
(e) No rule and regulation shall be filed by the secretary of state
unless:
(1) The rule and regulation has complied with the provisions of
subsection (a);
(2) The organization, style, orthography and grammar have been
approved by the secretary of administration;
(3)(2) the rule and regulation has been approved in writing by the
attorney general as to legality;
(3) the rule and regulation has complied with the provisions of
subsection (a);
(4) the rule and regulation has been formally adopted by the state
agency after it has complied with the provisions of subsection (a),
approved by the secretary of administration and the attorney general
and has complied with the provisions of subsection (a) and is
accompanied by a certified or other formal statement of adoption when
adoption is by an executive officer of a state agency, or by a certified
copy of the roll call vote required for its adoption by K.S.A. 77-421,
and amendments thereto, when adoption is by a board, commission,
authority or other similar body;
(5) the rule and regulation to be filed is accompanied by a copy of
the economic impact statement as provided by K.S.A. 77-416, and
amendments thereto, that has been reviewed and approved by the
director of the budget and complies with the provisions of subsection
(a);
(6) the rule and regulation has complied with the provisions of
section 1, and amendments thereto, if applicable; and
(6)(7) the rule and regulation to be filed is accompanied by a copy
of the environmental benefit statement required by K.S.A. 77-416, and
amendments thereto, if applicable. HOUSE BILL No. 2648—page 9
Sec. 5. K.S.A. 2023 Supp. 77-415, 77-416 and 77-420 are hereby
repealed.
Sec. 6. This act shall take effect and be in force from and after its
publication in the statute book.
I hereby certify that the above BILL originated in the
HOUSE, and passed that body
Speaker of the House.
Chief Clerk of the House.
Passed the SENATE ______________________________________________________________________________
President of the Senate.
Secretary of the Senate.
APPROVED __________________________________________________________________________________________________
Governor.