The City Club membership will vote on this report on
Friday, September 20, 1996. Until the membership vote, the City Club of
Portland does not have an official position on this report.
The outcome of
this vote will be reported in the City Club BULLETIN dated October 11,
1996.
I. INTRODUCTION
Ballot Measure 27 will appear on the ballot as follows:
Caption: Amends Constitution: Grants Legislature New Power over Both New, Existing Administrative Rules.
Result of "Yes" Vote: With "yes" vote, new administrative rules expire unless legislature approves; committee may veto existing rules.
Result of "No" Vote: "No" vote retains current system, allowing administrative rules to stay in effect without legislative approval.
Summary: Amends constitution. State agency rules now may be adopted and stay in effect without legislative approval. Legislature may require agency to change rules by adopting new statutes, subject to governor's veto. Measure would require agencies to file new rules with legislative committee. Rules would expire after legislature adjourns unless legislature approves rule by joint resolution. Upon qualified request, committee may review any new or existing rule and, upon review, must take public testimony. If committee rejects rule, rule expires unless legislature approves by joint resolution.
(The language of the caption, question, and summary was prepared by the Attorney General of Oregon.)
Measure 27 was referred to the voters by the 1995 Legislature as Senate Joint Resolution (SJR) 12 and was selected for study by the City Club from among the 23 measures to be voted on at the November 1996 General Election. The City Club chose to study this measure because of its potential impact on state government, and because it deals with matters on which most voters are not well informed. A committee was selected from among City Club members who had volunteered to participate in ballot measure studies. The Club screened committee members to ensure that no member had an economic interest in the outcome of the study or had taken a public position on the subject of the measure. Committee members met for three weeks, interviewed proponents and opponents of the measure and other interested persons, and reviewed relevant articles, reports, and other materials, as listed in the Appendices.
II. BACKGROUND
A. The Existing State Agency Rule-Making Process
The state legislature creates administrative agencies by passing laws that establish an agency's overall goals, policies, authority, function and power. These laws are also known as an agency's "enabling legislation." Given this broad direction, an agency develops and adopts more detailed rules to guide the agency's implementation of its legislative charge and the implementation of any subsequent directives from the legislature.
For example, the legislature could pass statutes directing the Child Care Division to adopt rules to ensure the safety, health, and appropriate supervision of children in family day care homes. The Division would then draft rules comparable to those in effect for child care centers, taking into consideration the differences in scale of the two types of operations. It would hold public hearings to obtain input from operators of family day care homes, from parents who use day care facilities, and from child development experts. The Division would then adopt rules to carry out the intent of the legislation, setting deadlines for compliance and establishing penalties for violations of the standards.
An agency thus: (1) adopts rules establishing programs and standards that the legislature has directed or permitted; (2) adopts procedural rules to guide the establishment of rules, conduct of contested cases and citizen interaction with the agency; and (3) enforces its own rules and terms of its enabling legislation. An agency may also adopt rules that explain how it interprets statutory requirements that it implements or enforces.
When an agency decides or is directed by the legislature to adopt a rule, it ordinarily must follow certain procedures. The agency must give proper notice to interested persons and those making a written request for notice. The agency gives interested persons an opportunity to submit data or their views and, upon request, the agency will schedule a public hearing. Generally, a certified copy of each rule adopted must be submitted to the Secretary of State to be valid or effective. Each agency must then submit a copy of the adopted rule to the legislature's legal counsel, the Legislative Counsel (Counsel). In many agencies (e.g., Department of Environmental Quality, and Land Conservation and Development Commission), rules are adopted by appointed citizen commissions. These commissioners generally rely on the technical knowledge and experience of agency staff, in addition to public input, when taking action on a rule.
Review of a rule by Counsel can be initiated in a number of different ways. Counsel may choose to review an adopted or proposed rule. The Legislative Counsel Committee, staffed by the Counsel, can require Counsel to review rules. Committee members include the speaker of the House and the president of the Senate who each appoint additional members to the committee. Counsel may review an adopted rule upon written request of any member of the Legislative Assembly
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considered excessive. The proponents' assumption appeared to be, the fewer rules the better. The committee noted, however, that rules are often of value in ensuring consistency in agencies' actions and that cutting down on the number of rules might therefore lessen the public's trust in government rather than increasing it.
Although the Oregon Senate and House of Representatives represent the Oregon electorate, opponents of the measure pointed out that the committee empowered by the measure to take action on administrative rules between legislative sessions would be chosen by the party in power in each house at that time, rather than by Oregon voters. Actions of such a highly political body would not necessarily represent the will of the people of Oregon. Yet this body would have power to nullify agency rules that have been in effect for decades without the full legislature ever taking action.
The rules that govern a number of Oregon's administrative agencies are adopted either by agency specialists or by unpaid citizen boards and commissions that hold public hearings and make decisions without regard to the effect of those decisions on re-election prospects or future job security. By giving the legislature the power to override these decisions by failing to approve them, Measure 27 undercuts citizen participation in two ways: it takes away the authority of the citizen boards that adopt the rules, and it ignores the testimony of citizens who appear at agency hearings—testimony that provides these boards and commissions with a basis for their rule-making decisions. Under the present system, interested persons receive notice whenever rule changes are being considered. Measure 27 offers no mechanism to assure that interested citizens would have an opportunity to testify on rules that would be negated by the legislature not acting to approve them.
If most rules receive legislative approval without being considered individually, then legislative approval is a meaningless, wasteful exercise. On the other hand, if the legislature, through the inaction of a single house, can nullify a rule by failing to approve it, then important checks and balances in the existing Oregon system will have been eliminated. Under Measure 27, both houses of the legislature need not affirmatively act to disapprove a rule—indeed, legislators need not publicly state their position on the invalidation of the rule—the Governor has no opportunity to veto the invalidation of the rule, and the people cannot use the referendum to reject the invalidation of the rule.
Measure 27 also appears to have been drafted without giving much thought to practical consequences. In addition to the problem of having the legislature approve each and every new rule, Measure 27 will likely create other, probably unintended problems. For example, because every new rule will become invalid if not approved by the next legislature, citizens would be uncertain about the long-term validity of a rule, and especially of controversial rules, for a period of up to two years. In addition, the broad definition of "administrative rule" in the measure would subject to legislative approval many agency statements and actions that are not ordinarily thought of as administrative rules. Will the state college student who is expelled for violating a student conduct rule argue for reinstatement because no one thought to have the legislature approve the rule of conduct that was violated? Will the person who exceeds the speed limit on a state highway argue that the legislature never approved the speed limit on that stretch of highway? It is not hard to imagine such arguments, and the legislature would have no ability to resolve any such problems in the future because the measure is a constitutional amendment that can only be amended by another constitutional amendment.
Measure 27 is a blunt, badly conceived effort to limit the scope of governmental regulation. If the current scope of government regulation is too broad, the people's representatives—the Legislative Assembly and the Governor—or the people themselves, through the initiative and referendum, can limit the scope of that regulation. Although specifically asked by your committee, no proponent of Measure 27 provided a single example of a governmental regulation that "went too far" and that the existing system was not able to correct. Rather, Measure 27 appears to be designed to thwart governmental programs and regulations that have sufficient support to resist repeal in the ordinary manner. It would do this by creating a process that would allow administrative rules to vanish into a black hole of politically maneuvered legislative inaction.
VI. RECOMMENDATION
Your committee unanimously recommends a NO vote on Measure 27.
Respectfully submitted,
Victor Allen
Deneen Aubertin
Michael Campbell
Jeffrey Chicoine
Paula Coppel
Nancy Rangila
Donald Sterling
Courtney Wilton
B. J. Seymour, chair
Cory Streisinger, research advisor
Paul Leistner, research director
VII. APPENDICES
A. Witness List
Brady Adams, state senator
Ron Cease, state senator
John Glascock, chair, State Legislative Committee, American Association of Retired Persons (AARP)
Kate Kelly, Idaho assistant attorney general
Greg Leo, director of governmental affairs, Oregon Farm Bureau
Marge Martin, Michigan Legislative Service Bureau
Fred Miller, executive, Portland General Corporation; former state agency director
Mary Renstrom, National Conference of State Legislatures
Steven R. Schell, attorney; member, Oregon Energy Facilities Siting Council
Gary Underwood, Capital City Task Force Coordinator, AARP
B. RESOURCE MATERIALS
Linde, Honorable Hans A., retired justice, Oregon Supreme Court, letter concerning Measure 27, August 2, 1996.
AARP materials related to Measure 27:
• Position Statement
• Memo from AARP National Counsel
Oregon Farm Bureau Testimony and Letters to Legislators on SJR 12
Oregon Optometric Association Statement on Measure 27
Oregon Secretary of State's Office, Measure 27 Fiscal Impact Statement
Oregon Senate, Minutes of Hearings on SJR 12
Oregon Voters' Pamphlet, Measure 27 Explanatory Statement
North Dakota Statute on Legislative Review of Rules
Rhyme, Nancy. Legislative Review of Administrative Rules and Regulations, National Conference of State Legislatures, 1990.