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promulgating rules under the administrative procedures act

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promulgating rules under the administrative procedures act

Administrative Rules Manual Page 1

State Office of Administrative Hearings and Rules

    PO Box 30695; 611 W. Ottawa Street

    Lansing, MI 48909-8195

    Phone (517) 335-2484 FAX (517) 335-6696

    soahr_rules@michigan.gov

    Peter L. Plummer, Executive Director

    Norene Lind, Administrative Rules Manager

    Deidre O’Berry, Departmental Analyst

     Table of Contents

    Page(s) Subject

    2 Administrative Rules Process in a Nutshell (single page at-a-glance summary)

    3-11 Promulgating Rules Under the Administrative Procedures Act (step-by-step)

12-13 Request for Rulemaking (regular sample)

    14-15 Request for Rulemaking (sample of Section 44[1] rules)

16-29 Regulatory Impact Statement (sample)

30-31 Rulemaking Policy Analysis Form (sample)

32 Public Hearing Notice (sample)

33 Public Hearing Sign-In Sheet

34 Public Hearing Script (sample)

35-43 JCAR Agency Report (sample)

44 Certificate of Adoption (sample)

45-50 How to Promulgate a “Guideline” (and sample)

51 Standard For Contracts Or DCH Policies Procedure

52-55 Emergency Rule Procedures (and sample)

    56 Correction of Obvious Error Procedure (MCL 24.256)

57 Promulgating Rules Under Section 44(1) of the APA

58 Promulgating Rules Under SOAHR’s Authority

    59 Three (3) Ways to State the Effective Date

     State Office of Administrative Hearings and Rules June 1, 2006

    Administrative Rules Manual Page 2

    Administrative Rules Process in a Nutshell (As of 6-28-06)

    Requests to commence rulemaking can come from professional Request for boards/commissions, the department, or the public. The RAO sends an

    Rulemaking (RFR) RFR electronically to SOAHR.

    I.

     Board/commission (and department) approves the draft; Regulatory Affairs Officer (RAO) of department or agency Pre-Hearing approves the draft.

     SOAHR approves (authority/policy) and sends to LSB. Draft Rules

     LSB edits and returns to SOAHR; SOAHR returns to

    department/agency for correction.

    II.

     Regulatory Impact Statement (the “why” and "$" document) is approved by the RAO and sent to SOAHR for approval. Rulemaking Policy Analysis Form is sent to SOAHR.

     Public hearing notice and LSB-corrected rules are sent by

    RAO to SOAHR. Public Hearing Newspaper ads (hearing notice secured by RAO).

     Michigan Register (SOAHR publishes notice).

     Court reporter (secured by RAO).

     Public comment period beyond hearing noted.

    

     Board/commission (and department) approves rules. Post-Hearing Department submits to SOAHR for approval. Draft Rules SOAHR submits the final rules to LSB, and LSB has 21 days

    to certify the rules for form, classification, and arrangement.

     SOAHR legally certifies (and can also certify for form if LSB

    did not complete the task in 21 days).

    

     The rules must be submitted to JCAR within one year from the Joint Committee hearing or there must be a subsequent hearing. on Administrative JCAR Agency Report summarizes changes made after the

    hearing. Rules (JCAR)

     JCAR has 15 session days to meet and object or waive the [Legislative committee] time limit.

    I.

     Department director adopts rules; or, the agency or Department or commission adopts if it is a Type I agency/commission. Agency Rules can be filed by SOAHR with Great Seal after 15 JCAR

    session days expires, unless JCAR files a notice of objection, Adopts the Rules

    which gives them 15 more session days to pass rules-stopping

    legislation and present it to the Governor.

     SOAHR enters the filing date at the top of the first page of the

    rules and sends an electronic copy of the final rules to the

    Great Seal and to the RAO.

     The rules may become effective immediately upon filing or at

    a later date specified in the rules [MCL 24.245a(2)-(5)].

     State Office of Administrative Hearings and Rules June 1, 2006

Administrative Rules Manual Page 3

    FULL APA PROCESS

    PA 262 of 1999 PA 262 of 1999: Amended the Administrative Procedures Act (1969 PA 306); Under the act, the State Office of Administrative Hearings and Rules is responsible for establishing procedures for processing administrative rules.

    PA 263 of 1999 PA 263 of 1999: Amended 1970 PA 193, the compilation of the general laws, and the

    compilation and revision of state administrative rules known as the Michigan Administrative Code (the “MAC”).

PA 264 of 1999: Amended the Legislative Council Act (1986 PA 268) and places the

    responsibility to publish the Michigan Register with the State Office of Administrative Hearings

    and Rules.

    Executive Order 2005-1: Moved the rulemaking function into a newly created office. The new office is called the State Office of Administrative Hearings and Rules (SOAHR).

    ACRONYMS

APA The “Administrative Procedures Act" (PA 306 of 1969)

RAO Regulatory Affairs Officer (Department liaison)

SOAHR State Office of Administrative Hearings and Rules (Office responsible for

    reviewing rules for legality, as well as economic and regulatory impact)

LSB Legislative Service Bureau (Attorneys who edit and format rule language)

RFR Request for Rulemaking

RIS Regulatory Impact Statement

RPAF Rulemaking Policy Analysis Form

JCAR Joint Committee on Administrative Rules

    (5 members of the House of Representatives; 5 members of the Senate)

    With Administrative Rules,

    Timing Is Everything!

     State Office of Administrative Hearings and Rules June 1, 2006

    Administrative Rules Manual Page 4

    STEP 1 - The "Request for Rulemaking" (RFR)

    A Request for Rulemaking (RFR) can originate from agency suggestions, A

    professional/technical boards, legal mandates, or requests from the public. [MCL 24.238, 24.239]

The bureau or agency affected by the rules submits an electronic copy of B

    the RFR to the Regulatory Affairs Officer (RAO) of the Department. The RAO, in consultation with the Executive Office and Bureau/Agency Director, may reject the RFR or approve and forward one electronic copy

    to the State Office of Administrative Hearings and Rules (SOAHR) for

    review and signature/approval. The legal staff within SOAHR reviews

    the proposed RFR to make sure what it proposes to do will not conflict

    with current statute or other rules. [MCL 24.239(1)]

    The SOAHR forwards a copy of the RFR to the Joint Committee on C

    Administrative Rules (JCAR) and enters receipt of the RFR on the web. SOAHR responds to the RFR by either:

     approving the RFR,

     disapproving the RFR, or

     requesting additional information from the RAO, bureau, or

    agency to obtain the necessary information. (See D)

SOAHR’s action is noted on the web, and the SOAHR sends a weekly

    list of RFR approvals and disapprovals to JCAR. Approved RFR’s will be assigned a number by SOAHR for tracking purposes. [MCL 24.236,

    24.239(2), 24.239(4)]

RFR’s needing additional information must be re-submitted through the D

    RAO’s office. The RAO will re-submit the RFR to SOAHR for

    approval.

    The RFR...An Idea is Born

     State Office of Administrative Hearings and Rules June 1, 2006

    Administrative Rules Manual Page 5

STEP 2 - Draft Approval and Submission

    Once the RFR is approved, the agency, working in conjunction with A

    departmental staff, professional boards, committees, etc., begins drafting

    rule language (new rules; amended rules; rescinded rules).

The agency submits an electronic copy of the draft rules in strike-bold B

    format to the department’s RAO prior to informal review by SOAHR and

    LSB. Strike-bold format is used to denote modified, deleted, or added text in existing rules. Brand new rule sets (without current rule text) do not

    have to be submitted in such format. Please refer to the LSB publication entitled, “Administrative Rules in Michigan: A Manual of Style and

    Procedures.” This document will show you how the rules should be laid out and formatted.

The department’s RAO will review the draft language prior to forwarding C

    an electronic copy to SOAHR for approval. [MCL 24.239a(1)]

The RAO will submit the draft language to SOAHR, and SOAHR will D

    respond by:

     granting approval, and sending to LSB for legal editing,

     denying approval to proceed, or

     requesting changes or clarifications to the draft language.

The SOAHR shall send an electronic strike-bold version of the approved E

    draft language to the Joint Committee on Administrative Rules [JCAR] (or

    shall send a non-strike bold version, if the rule set contains all new rules).

    SOAHR will also make a copy of the draft rules available on its web site.

    [MCL 24.239a(2)]

     State Office of Administrative Hearings and Rules June 1, 2006

    Administrative Rules Manual Page 6

STEP 3 Public Hearing Notification

    After SOAHR approval is granted, SOAHR will submit strike/bold rules A

    to the Legislative Service Bureau (LSB) for informal approval. LSB will mark editorial revisions on the text and return it to SOAHR. SOAHR

    will keep a copy of the LSB edits and return the original edits to the RAO. The RAO will maintain a file copy of the LSB edits and forward the original copy of the edited draft to the agency for correction. [MCL

    24.236]

The agency will produce a revised strike/bold draft of the rules, based on B

    LSB’s recommended edits. The agency will also schedule a public hearing (unless a hearing is exempt under Sections 44[1] and 44[2] of the APA). The corrected draft copy of the rules (in strike-bold format) and

    an electronic notice of the public hearing shall be given to the RAO, which will be forwarded (electronic format) to SOAHR for publication

    on the web and in the Michigan Register. SOAHR must also forward a

    copy of the public hearing notice to JCAR within seven (7) days of

    receipt. [MCL 8.6, 24.239a(2), 24.241, 24.242(3)]

Copies of the public hearing notice must be submitted to SOAHR

    electronically by the RAO for posting on the web and insertion in the Michigan Register prior to the public hearing. The Michigan Register is

    published on the 1st and 15th of each month.

If a public hearing is required, the RAO must publish the notice as

    follows [MCL 24.242 (1) and (3)]:

     in three (3) newspapers of general circulation not less than 10 nor

    more than 60 days prior to the public hearing. One of the

    newspapers must be located in the Upper Peninsula.

Note: Rules which are being promulgated under MCL 24.244(1), which

    are being amended or rescinded because they are obsolete or superseded, or because obvious corrections are necessary to make the rule conform to an amended or new statute, do not require a public hearing or posting in the Michigan Register; nor do rules promulgated under MCL 24.244(2)

    that are MIOSHA/OSHA federal equivalents.

     State Office of Administrative Hearings and Rules June 1, 2006

    Administrative Rules Manual Page 7

    STEP 4 - Regulatory Impact Statement And Public Hearing

    The agency should complete and forward an electronic copy of the Regulatory A

    Impact Statement (RIS) to the RAO 35 days prior to the first scheduled public

    hearing. The RAO will review the RIS for completeness and correctness. Once signed by the RAO, the RAO must submit an electronic copy of the RIS to

    SOAHR not less than 28 days prior to the public hearing. [MCL 24.245(3)-(4)]

A Rulemaking Policy Analysis Form (RPAF) must also be submitted to SOAHR

    at this time.

Note: Rules promulgated under MCL 24.244 and MCL 24.248 do not require a

    Regulatory Impact Statement or a Rulemaking Policy Analysis Form.

    [MCL 24.245(4)] The SOAHR reviews the RIS and: B

     approves the RIS,

     disapproves the RIS, or

     requires modification to the RIS

    The final RIS must be approved prior to the public hearing. SOAHR posts the RIS on the web and sends an approved copy to JCAR and the RAO.

    The head of the promulgating agency or 1 or more persons designated by the C

    head of the agency who have knowledge of the subject matter of the proposed rule shall be present at the hearing and shall participate in the discussion of the proposed rule(s). [MCL 24.241(5)] The hearing must be recorded by a

    stenographer or by an audio or video recording device. Copies of the draft rules,

    the RIS, and a sign-in sheet must be available at the public hearing. [MCL

    24.241, 24.242, 24.245]

    The RAO, in consultation with department staff, will review public hearing D

    transcription. Written commentary (letters/e-mail/FAX) received from the

    public during the specified public comment period will also be reviewed. All requests for modifications will be reviewed to see if the changes should be incorporated into a final version of the draft rules.

    [MCL 24.245] If the department makes no changes to the draft rules after the E

    public commentary period, the rules can be sent to SOAHR for review and

    subsequent submission to LSB for formal certification. If textual changes are made in response to comments received in writing or at the public hearing, they are only allowed if:

     they are non-substantive changes (i.e. minor technical changes),

     they are changes made in response to public commentary received at

    hearing or submitted within the specified comment time, and they are

    approved by SOAHR, or

     SOAHR requests change so rule does not conflict with current law, rule,

    or case law.

     State Office of Administrative Hearings and Rules June 1, 2006

    Administrative Rules Manual Page 8

    STEP 5 - Formal Certification

    Once all textual changes have been made, the bureau/agency will prepare A

    matching strike/bold and non-strike/bold versions of the new draft rules

    and submit them to SOAHR for review.

The "JCAR Agency Report" should be completed by the RAO and B

    submitted to SOAHR electronically. The agency/bureau representative(s), in conjunction with the RAO, must prepare the "JCAR Agency Report" containing a synopsis of the comments contained in the public hearing record and a description of any changes made to the rules as a result of public commentary. This report must be forwarded electronically by the

    RAO to SOAHR before SOAHR will formally certify the rules. The report must contain the three newspaper ads, which can either be scanned into the document or sent as a supplemental attachment (PDF file or hard copy).

    SOAHR will compare the new draft rules against the JCAR Agency Report to account for all changes, and to ensure legality. [MCL 24.236, 24.245]

Note: Rules being promulgated under MCL 24.244 and MCL 24.248 do

    not require an agency report. [MCL 24.245(6)]

    Four (4) hard copies of the non-strike-bold rules, as well as an electronic C

    copy, including textual changes described in Step 4-E, may then be

    submitted to LSB by SOAHR for formal certification. The updated draft

    must contain a revision date in the lower right corner of the first page. If

    no changes were made, the revision date should also remain unchanged.

    [MCL 24.245(1)]

    If the rules reside at LSB for more than 21 days, the department may ask SOAHR to complete the formal certification for both LSB and SOAHR (which makes LSB formal certification unnecessary). [MCL 8.6,

    24.245(1)]

LSB will forward their legal certificate to SOAHR. If SOAHR believes the D

    rules can be legally certified, it will do so. Both LSB and SOAHR

    certifications will be sent by SOAHR to the RAO electronically. SOAHR

    will also post the certified rules on the web.

     State Office of Administrative Hearings and Rules June 1, 2006

    Administrative Rules Manual Page 9

    STEP 6 - JCAR Submission and Adoption

    SOAHR will prepare the JCAR package for submission to JCAR (Joint A

    Committee on Administrative Rules). The package will include:

     A transmittal letter to JCAR.

     One (1) copy of the JCAR Agency Report.

     One (1) copy of the rule set (strike-bold, if applicable).

     One (1) copy of the LSB and SOAHR certificates.

     One (1) copy of the Regulatory Impact Statement.

The rules package must be delivered to JCAR within one (1) year after

    the last public hearing. If not, the rules will be sent back to Step 3 for a

    subsequent public hearing. [MCL 24.236, 24.245]

[MCL 24.245] Once the SOAHR submits the rules package to JCAR, B

    the review period clock will commence. At this time, the RAO will work with the agency/bureau to coordinate the signing and submission of the

    Certificate of Adoption” (C of A). The Department Director or Deputy Director signs the C of A for all agencies that are not “Type I agencies” or commissions with promulgation authority. In these cases, a

    designated official from the Type I agency or commission prepares and

    signs the C of A. It should be sent electronically to SOAHR.

[MCL 24.245a] After JCAR receives the rules package, JCAR has 15 C

    session days to review the proposed rules. JCAR may file a “notice of

    objection” to a proposed rule within that period with the approval of a

    concurrent majority of its members IF they find any of the following:

     The agency lacks statutory authority for the rule.

     The agency is exceeding the scope of its rule-making authority.

     There exists an emergency relating to the public health, safety,

    and welfare that would warrant disapproval of the rule.

     The rule is in conflict with state law.

     A substantial change in circumstances has occurred since

    enactment of the law upon which the proposed rule is based.

     The rule is arbitrary or capricious.

     The rule is “unduly burdensome” to the public or licensees.

If JCAR elects to hold a hearing on a proposed rule, they will notify D

    SOAHR. SOAHR will notify the RAO, who should, in turn, ensure that

    appropriate staff (bureau, agency, etc.) is present at the JCAR hearing to

    explain and/or defend the rule(s).

     State Office of Administrative Hearings and Rules June 1, 2006

    Administrative Rules Manual Page 10

STEP 7 - JCAR Notice of Objection

    If no “notice of objection” is adopted within the 15-session day period or A

    if JCAR fails to meet within the 15 session days, SOAHR can file the

    rules with the Michigan Department of State, Office of the Great Seal. JCAR may also vote to “waive” the 15-session day period, which allows

    the SOAHR to file the rules immediately. (In either case, skip to Step 8.)

If JCAR adopts a “Notice of Objection” within the 15-session day

    period described in Step 6, bills will be introduced in both chambers

    (House and Senate) and placed immediately on the calendars. The bills may propose one of three things:

     Rescind the rule upon its effective date [Sec. 45a (3)(a)].

     Repeal the statutory provision under which the rule was

    authorized [Sec. 45a (3)(b)].

     Stay the rule’s effective date for up to one year [Sec. 45a (3)(c)].

The notice of objection stays the ability of SOAHR to file the rule with B

    the Secretary of State until the earlier of the following:

     Fifteen session days after the notice of objection is filed.

     The date of the rescission of the issuance of the notice of

    objection, approved by a concurrent majority of JCAR members.

    If the legislation is passed by both chambers of the legislature and presented to the Governor within the 15-session-day period, the rules do

    not become effective unless the legislation is vetoed by the Governor, as

    provided by law. If the Governor vetoes the legislation (and the veto is not overridden), SOAHR may file the rules immediately. [MCL 24.245a

    (4)-(6)]. In this case, the rules may be filed and will become effective 7 days after the date of filing.

Rules shall take effect immediately after filing with the Great Seal (see C

    step 8), unless a later date is indicated by the rules. Or, if the rules are

    adopted under sections 33, 44, or 45a(6) of the APA, they become effective 7 days after filing (or later). [MCL 24.245a(2)-(5)]

     I object!

     State Office of Administrative Hearings and Rules June 1, 2006

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