To repeal sections 536.017, 536.021 and 536.022, RSMo 1994, and sections 536.025 and 536.050, RSMo Supp. 1996, relating to administrative rulemaking, and to enact in lieu thereof seven new sections relating to the same subject, with an emergency clause.

Be it enacted by the General Assembly of the State of Missouri, as follows:

     Section A. Sections 536.017, 536.021 and 536.022, RSMo 1994, and sections 536.025 and 536.050, RSMo Supp. 1996, are repealed and seven new sections enacted in lieu thereof, to be known as sections 536.016, 536.017, 536.021, 536.022, 536.025, 536.028 and 536.050, to read as follows:

     536.016. 1. No agency rule or regulation shall be valid in the event that:

     (1) There is an absence of statutory authority for the rule or any portion thereof; or

     (2) The rule is in conflict with state law; or

     (3) The rule is so arbitrary and capricious as to create such substantial inequity as to be unreasonably burdensome on persons affected; or

     (4) The rule exceeds the purpose, or is more restrictive than is necessary to carry out the purpose, of the statute granting rulemaking authority.

     2. Any state agency shall propose rules based upon substantial evidence on the record and a finding by the agency that the rule is necessary to carry out the purposes of the statute that granted such rulemaking authority.

     3. Each state agency shall adopt procedures by which it will determine whether a rule is necessary to carry out the purposes of the statute authorizing the rule. Such criteria and rulemaking shall be based upon reasonably available empirical data and shall include an assessment of the effectiveness and the cost of rules both to the state and to any private or public person or entity affected by such rules.

     536.017. [1.] For purposes of this section, "taking of private property" shall mean an activity wherein private property is taken such that compensation to the owner of the property is required by the fifth and fourteenth amendments to the Constitution of the United States or any other similar or applicable law of this state. No department or agency shall transmit a proposed rule [or regulation] which limits or affects the use of real property to the secretary of state until a takings analysis has occurred. The takings analysis shall evaluate whether the proposed rule [or regulation] on its face constitutes a taking of real property under relevant state and federal law. The department or agency shall certify in the transmittal letter to the secretary of state that a takings analysis has occurred. A takings analysis shall not be necessary where the proposed rule [or regulation] is being [promulgated] adopted on an emergency basis, where the proposed rule [or regulation] is federally mandated, or where the proposed rule [or regulation] substantially codifies existing federal or state law.

     [2. The provisions of this section shall expire on September 1, 1997.]

     536.021. 1. No rule shall hereafter be made, amended or rescinded by any state agency unless such agency shall first file with the general assembly and the secretary of state a notice of proposed rulemaking and a subsequent order of rulemaking, both of which shall be published in the Missouri Register by the secretary of state as soon as practicable after the filing thereof [in his office]; except that:

     (1) An order of rulemaking shall not take effect and shall not be published prior to the expiration of thirty legislative days of a regular session occurring in the same calendar year after such order of rulemaking has been filed with the general assembly and the secretary of state; and

     (2) A notice of proposed rulemaking is not required for the establishment of hunting or fishing seasons and limits or for the establishment of state program plans required under federal education acts or regulations.

     2. A notice of proposed rulemaking shall contain:

     (1) An explanation of any new rule or any change in an existing rule, and the reasons therefor;

     (2) The legal authority pursuant to which the rule is proposed to be made;

     (3) The text of the entire rule proposed to be made or the entire text of any affected section or subsection of a rule which is proposed to be amended, with all new matter underlined or printed in boldface type and with all deleted matter placed in brackets, except that when a proposed rule consists of material so extensive that the publication thereof would be unduly cumbersome or expensive, the secretary of state need publish only a summary and description of the substance of the rule so long as a complete copy of the rule is made immediately available to any interested person upon application to the adopting state agency at a cost not to exceed the actual cost of reproduction. A proposed rule may incorporate by reference only if the material so incorporated is retained at the headquarters of the state agency and made available to any interested person at a cost not to exceed the actual cost of the reproduction of a copy. When a proposed amendment is to correct a typographical or printing error, or merely to make a technical change not affecting substantive matters, the amendment may be described in general terms without reprinting the entire rule, section or subsection;

     (4) The number and general subject matter of any rule proposed to be rescinded;

     (5) Notice that anyone may file a statement in support of or in opposition to the proposed rulemaking at a specified place and within a specified time not less than thirty days after publication of the notice of proposed rulemaking in the Missouri Register;

     (6) Notice of the time and place of a hearing on the proposed rulemaking if a hearing is ordered, which hearing shall be not less than thirty days after publication of the notice of proposed rulemaking in the Missouri Register; or a statement that no hearing has been ordered if such is the case.

     3. Any state agency issuing a notice of proposed rulemaking may order a hearing thereon, but no such hearing shall be necessary unless otherwise required by law.

     4. Any state agency which has issued in the Missouri Register a notice of proposed rulemaking to be made without a hearing, but which thereafter concludes that a hearing is desirable, shall withdraw the earlier notice and file a new notice of proposed rulemaking which fully complies with the provisions of subdivision (6) of subsection 2 of this section, and the state agency shall not schedule the hearing for a time less than thirty days following the publication of the new notice.

     5. Within ninety days after the expiration of the time for filing statements in support of or in opposition to the proposed rulemaking, or within ninety days after the hearing on such proposed rulemaking if a hearing is held thereon, the state agency proposing the rule shall file with the secretary of state an order of rulemaking either adopting the proposed rule, with or without further changes, or withdrawing the proposed rule, which order shall be published in the Missouri Register. The order of rulemaking shall contain:

     (1) Reference to the date and page or pages where the notice of proposed rulemaking was published in the Missouri Register;

     (2) An explanation of any change between the text of the rule as contained in the notice of proposed rulemaking and the text of the rule as finally adopted, together with the reason for any such change;

     (3) The full text of any section or subsection of the rule as adopted which has been changed from that contained in the notice of proposed rulemaking;

     (4) A brief summary of the general nature and extent of comments submitted in support of or in opposition to the proposed rule and a concise summary of the testimony presented at the hearing, if any, held in connection with said rulemaking, together with a concise summary of the state agency's findings with respect to the merits of any such testimony or comments which are opposed in whole or in part to the proposed rule.

     6. Except as provided in subsection 4 of section 536.023 and in section 536.025, any rule, or amendment or rescission thereof, made after January 1, 1976, shall be void unless made in accordance with the provisions of this section.

     7. All rules shall be published in full in the Missouri code of state regulations. No rule, except an emergency rule, may become effective prior to the thirtieth day after the date of publication of the revision to the Missouri code of state regulations. The secretary of state shall distribute revisions of the Missouri code of state regulations to all subscribers of the Missouri code of state regulations on or before the date of publication of such revision. The publication date of each rule shall be printed below the rule in the Missouri code of state regulations, provided further, that rules pertaining to changes in hunting or fishing seasons and limits that must comply with federal requirements or that are necessary because of documented changes in fish and game populations may become effective no earlier than on the tenth day after the filing of the order of rulemaking.

     8. Effective September 1, 1990, if it is found in a contested case by an administrative or judicial fact finder that a state agency's action was based upon a statement of general applicability which should have been promulgated as a rule, as required by sections 536.010 to 536.050, and that agency was put on notice in writing of such deficiency prior to the administrative or judicial hearing on such matter, then the administrative or judicial fact finder shall award the prevailing [nonstate agency] party its reasonable costs, expenses and attorney's fees incurred [prior to the award, not to exceed the amount in controversy in the original action]. This award shall constitute a reviewable order. If a state agency in a contested case grants the relief sought by the [nonstate] party prior to a finding by an administrative or judicial fact finder that the agency's action was based on a statement of general applicability which should have been promulgated as a rule, but was not, then the affected party may bring an action in the circuit court of Cole County for [his] the party's reasonable costs, expenses and attorney's fees incurred prior to the relief being granted[, not to exceed the amount in controversy in the original action].

     9. The actions authorized by subsection 8 of this section shall not apply to the department of revenue if that department implements the authorization hereby granted to the director or [his] the director's duly authorized agents to issue letter rulings which shall bind [him] the director or [his] the director's agents and their successors for a minimum of three years, subject to the terms and conditions set forth in properly published regulations. An unfavorable letter ruling shall not bind the applicant and shall not be appealable to any forum. Subject to appropriations, letter rulings shall be published periodically with information identifying the taxpayer deleted. For the purposes of this subsection, the term "letter ruling" means a written interpretation of law by the director to a specific set of facts provided by a nonstate party.

     10. Upon a challenge to an agency's action pursuant to subsection 8 of this section, the agency shall have the burden of proving by a preponderance of the evidence that the action taken by the agency was not required to be preceded by the adoption of a rule on the subject matter. The general assembly or its designee shall have standing, in law or equity, to intervene in any existing action involving such challenge to agency action. Unless otherwise provided by resolution, the general assembly's designee is the joint committee on administrative rules who may, upon a concurrence of a majority of the committee's members, file suit in the name of the committee's chairperson in his or her official and representative capacity. Nothing in this section shall confer upon the committee nor its chairperson any duty to so act or intervene.

     536.022. 1. If any rule or portion of a rule of a state agency is suspended, [or] terminated, annulled or amended by action of the general assembly, the governor, a court or other authority, the state agency shall immediately file a notice of such action with the secretary of state.

     2. The notice, in a format for publication designed by the secretary of state, shall contain the title and number of the rule; shall describe briefly the action taken with regard to the rule and the parties affected by the suspension, [or] termination, annulment or amendment of such rule or portion thereof; shall state the effective date [of the suspension or termination; shall state the duration of the suspension] thereof; and shall contain such other information deemed necessary by the secretary of state to provide adequate public information.

     3. If any action has the effect of changing the information in the initial notice, the state agency shall immediately file a new notice with the secretary of state in the same manner as the original notice.

     4. Except as otherwise provided in subdivision (10) of section 536.028, notices shall be printed by the secretary of state in the Missouri Register as soon as practicable. The secretary of state shall insert in the code of state regulations material regarding the suspension, [or] termination, annulment or amendment of rules, and [he] may remove rules which have terminated.

     536.025. 1. A rule may be made, amended or rescinded by a state agency without following the provisions of section 536.021, [and] subsection 5 of section 536.027 and section 536.028, only if the state agency:

     (1) Finds that an immediate danger to the public health, safety or welfare requires emergency action or that the rule is necessary to avoid serious disruption of essential state services;

     (2) Follows procedures best calculated to assure fairness to all interested persons and parties under the circumstances;

     (3) Follows procedures which comply with the protections extended by the Missouri and United States Constitutions;

     (4) Limits the scope of such rule to the circumstances creating an emergency and requiring emergency procedure; and

     (5) At the time of or prior to the adoption of such rule files with the secretary of state and the joint committee on administrative rules the text of the rule together with the specific facts, reasons, and findings which support its conclusion that there is an immediate danger to the public health, safety or welfare which can be met only through the adoption of such rule and its reasons for concluding that the procedure employed is fair to all interested persons and parties under the circumstances.

     2. Material filed with the secretary of state and the joint committee on administrative rules under the provisions of subdivision (5) of subsection 1 of this section shall be published in the Missouri Register by the secretary of state as soon as practicable after the filing thereof. Any emergency rule shall be reviewed by the secretary of state to determine compliance with the requirements for its publication and adoption established in this section, and in the event that the secretary of state determines that such proposed material does not meet those requirements, the secretary of state shall not publish the emergency rule. The secretary of state shall inform the agency of its determination, and offer the agency a chance to either withdraw the emergency rule or to have the emergency rule published as a proposed rule.

     3. [If] The [joint] committee on administrative rules [disapproves] may hold hearings on any emergency rule [or portion thereof, the committee shall] and may make recommendations and report its findings to the senate and the house of representatives. The recommendations and report of the committee shall be admissible as evidence in any judicial proceeding and entitled to judicial notice without further proof. [No] Any emergency rule or portion thereof [disapproved by the committee shall take effect unless the senate and the house of representatives fail to ratify the action of the joint committee by resolution adopted in each house within thirty legislative days after such rule or portion thereof has been disapproved by the joint committee] may be suspended or revoked by the general assembly by bill or, upon recommendation by the committee, by a concurrent resolution pursuant to the provisions of article IV, section 8 of the Missouri Constitution.

     4. Since an agency's authority to promulgate substantive rules is a delegation of legislative power, the general assembly may limit an agency's exercise of delegated authority by granting the committee on administrative rules the power to disapprove and suspend emergency rules. The committee may suspend an emergency rule for up to thirty legislative days of a regular session to allow the legislature sufficient time to act where the committee finds after hearing one or more of the following to be true:

     (1) There is an absence of statutory authority for the rule or any portion thereof;

     (2) The rule is in conflict with state law;

     (3) The rule creates substantial inequities such that affected persons are unreasonably burdened;

     (4) The rule exceeds the purpose, or is more restrictive than is necessary to carry out the purpose of the statute granting rulemaking authority; or

     (5) The requirements of subsection 1 of this section have not been met.

     [4.] 5. Rules adopted under the provisions of this section shall be known as "emergency rules" and shall, along with the findings and conclusions of the state agency in support of its employment of emergency procedures, be judicially reviewable under section 536.050 or other appropriate form of judicial review. The secretary of state and any employee thereof, acting in the scope of employment, shall be immune from suit [in actions] for any action taken regarding [the adoption of] rules filed pursuant to this section.

     [5.] 6. A rule adopted under the provisions of this section shall clearly state the interval during which it will be in effect and which, in no case, may be for a period exceeding [one hundred eighty days] the thirtieth legislative day of a regular session after the filing with the secretary of state and the committee.

     [6.] 7. A rule adopted under the provisions of this section shall not be renewable, nor shall an agency adopt consecutive emergency rules that have substantially the same effect, although a state agency may, at any time, adopt an identical rule under normal rulemaking procedures, subject to the limitations provided in section 536.028.

     [7.] 8. A rule adopted under the provisions of this section may be effective not less than ten days after the filing thereof in the office of the secretary of state, or at such later date as may be specified in the rule or by law, and may be terminated at any time by the state agency by filing an order with the secretary of state fixing the date of such termination, which order shall be published by the secretary of state in the Missouri Register as soon as practicable after the filing thereof.

     [8.] 9. Effective September 1, 1994, if it is found in a contested case by an administrative or judicial fact finder that [a state agency's] an agency rule should not have been promulgated as an emergency rule as provided by subsection 1 of this section, [but was in fact promulgated as an emergency rule pursuant to this section,] then the administrative or judicial fact finder shall award the prevailing party its reasonable costs, expenses and attorney's fees incurred [prior to the award, not to exceed the amount in controversy, if any, in the original action]. This award shall constitute a reviewable order. If a state agency in a contested case grants the relief sought by the party prior to a finding by an administrative or judicial fact finder that the state agency's action was based on a statement of general applicability which should not have been promulgated as an emergency rule, but was in fact promulgated as an emergency rule pursuant to this section, then the affected party may bring an action in circuit court of Cole County for his reasonable costs, expenses and attorney's fees incurred prior to the relief being granted[, not to exceed the amount in controversy in the original action].

     10. Upon a judicial challenge that a rule should not have been adopted as an emergency rule, the agency that adopted the rule shall have the burden of proving by a preponderance of the evidence that the agency has fully complied with the provisions of this section and that the condition that led to the promulgation of the rule was an emergency pursuant to this section.

     11. For purposes of this section, the general assembly or its designee shall have standing, in law or equity, to intervene in any existing action. Unless otherwise provided by resolution, the general assembly's designee is the joint committee on administrative rules who may, upon a concurrence of a majority of the committee's members, file suit in the name of the committee's chairperson in his or her official and representative capacity. Nothing in this section shall confer upon the committee nor its chairperson any duty to so act or intervene.

     536.028. 1. The delegation of authority to any state agency to propose to the general assembly rules as provided under this section is contingent upon the agency complying with the provisions of this section and this delegation of legislative power to the agency to propose an order of rulemaking containing a rule or portion thereof that has the effect of substantive law, other than a rule relating to the agency's organization and internal management, is contingent and dependent upon the power of the general assembly to review such proposed order of rulemaking, to delay the effective date of such proposed order of rulemaking until the expiration of at least thirty legislative days of a regular session after such order is filed with the general assembly and the secretary of state, and to disapprove and annul any rule or portion thereof contained in such order of rulemaking.

     2. No rule or portion of a rule that has the effect of substantive law shall become effective until the order of rulemaking, in which such rule or portion thereof is contained, has been reviewed by the general assembly in accordance with the procedures provided herein and the agency's authority to propose an order of rulemaking is dependent upon the power of the general assembly to disapprove and annul any such proposed rule or portion thereof as provided herein.

     3. In order for the general assembly to have an effective opportunity to be advised of rules proposed by any state agency under the authority of this section, an agency may propose a rule by complying with the procedures provided in section 536.021, except that the notice of proposed rulemaking shall first be filed with the general assembly by providing a copy thereof to the joint committee on administrative rules which may hold hearings upon any proposed rule or portion thereof at any time. The agency shall cooperate with the joint committee on administrative rules by providing any witnesses, documents or information within the control of the agency as may be requested.

     4. In order to propose an order of rulemaking to the general assembly, the agency shall comply with the provisions of section 536.021, except that the agency may file a proposed order of rulemaking with the secretary of state only by first filing such proposed order with the general assembly by providing a copy thereof to the secretary of the senate and the clerk of the house of representatives. The president pro tem of the senate shall direct that a copy of the proposed order of rulemaking be delivered to the joint committee on administrative rules which may hold hearings thereon. The agency shall cooperate with the committee by providing any witnesses, documents or information within the control of the agency as may be requested.

     5. Such proposed order of rulemaking shall not become effective prior to the expiration of thirty legislative days of a regular session after such order is filed with the secretary of state and the general assembly.

     6. The committee may, by majority vote of its members, recommend that the general assembly disapprove and annul any rule or portion thereof contained in an order of rulemaking after hearings thereon and, upon a finding that such rule or portion thereof should be disapproved and annulled upon the following grounds:

     (1) Such rule is substantive in nature in that it creates rights or liabilities or provides for sanctions as to any person, corporation or other legal entity; and

     (2) Such rule or portion thereof is not in the public interest or is not authorized by the general assembly for one or more of the following grounds:

     (a) An absence of statutory authority for the proposed rule;

     (b) The proposed rule is in conflict with state law;

     (c) Such proposed rule is likely to substantially endanger the public health, safety or welfare;

     (d) The rule exceeds the purpose, or is more restrictive than is necessary to carry out the purpose, of the statute granting rulemaking authority;

     (e) A substantial change in circumstance has occurred since enactment of the law upon which the proposed rule is based as to result in a conflict between the purpose of the law and the proposed rule, or as to create a substantial danger to public health and welfare;

     (f) The proposed rule is so arbitrary and capricious as to create such substantial inequity as to be unreasonably burdensome on persons affected.

     7. Any recommendation or report issued by the committee pursuant to subsection 6 of this section shall be admissible as evidence in any judicial proceeding and entitled to judicial notice without further proof.

     8. The general assembly may adopt a concurrent resolution in accordance with the provisions of article IV, section 8 of the Missouri constitution to disapprove and annul any rule or portion thereof upon one or more of the grounds stated in subsection 6 of this section.

     9. Any rule or portion thereof not disapproved within thirty legislative days of a regular session pursuant to subsection 8 of this section shall be deemed approved by the general assembly and the secretary of state may publish such order of rulemaking as soon as practicable upon the expiration of thirty legislative days of a regular session after the order of rulemaking was filed with the secretary of state and the general assembly.

     10. Upon adoption of such concurrent resolution as provided in subsection 8 of this section, the secretary of state shall not publish the order of rulemaking until the expiration of time necessary for such resolution to be signed by the governor, or vetoed and subsequently acted upon by the general assembly pursuant to article III, section 32 of the Missouri Constitution. If such concurrent resolution is adopted and signed by the governor or reconsidered pursuant to article III, section 32, the secretary of state shall publish in the Missouri Register, as soon as practicable, the order of rulemaking along with notice of the proposed rules or portions thereof which are disapproved and annulled by the general assembly.

     11. Notwithstanding the provisions of section 1.140, RSMo, the provisions of this section are nonseverable and the delegation of legislative authority to an agency to propose orders of rulemaking is essentially dependent upon the powers vested with the general assembly as provided herein. If any of the powers vested with the general assembly to review, to delay the effective date or to disapprove and annul a rule or portion of a rule contained in an order of rulemaking, are held unconstitutional or invalid, the purported grant of rulemaking authority and any rule so proposed and contained in the order of rulemaking pursuant thereto shall be invalid and void.

     12. Nothing in this section shall prevent the general assembly from adopting by bill within thirty legislative days of a regular session the rules or portions thereof, or as the same may be amended, as contained in a proposed order of rulemaking. In that event, the proposed order of rulemaking shall have been superseded and any rule proposed therein shall be void and only such rules adopted by the general assembly and submitted to the governor may become effective. Rules so adopted shall be published by the secretary of state as soon as practicable. In that event, the secretary of state shall not publish the proposed order of rulemaking and such proposed order of rulemaking shall be invalid and void.

     13. Upon adoption of any rule now in effect or hereafter promulgated, any such rule or portion thereof may be revoked by the general assembly either by bill, or by concurrent resolution pursuant to article IV, section 8 of the constitution on recommendation of the committee on administrative rules upon the grounds listed in subsection 6 of this section. The secretary of state shall publish in the Missouri Register, as soon as practicable, notice of the revocation.

     536.050. 1. The power of the courts of this state to render declaratory judgments shall extend to declaratory judgments respecting the validity of rules, or of threatened applications thereof, and such suits may be maintained against agencies whether or not the plaintiff has first requested the agency to pass upon the question presented. The venue of such suits against agencies shall, at the option of the plaintiff, be in the circuit court of Cole County, or in the county of the plaintiff's residence, or if the plaintiff is a corporation, domestic or foreign, having a registered office or business office in this state, in the county of such registered office or business office. Nothing herein contained shall be construed as a limitation on the declaratory or other relief which the courts might grant in the absence of this section.

     2. Any person bringing an action under subsection 1 of this section shall not be required to exhaust any administrative remedy if the court determines that:

     (1) The administrative agency has no authority to grant the relief sought or the administrative remedy is otherwise inadequate; or

     (2) The only issue presented for adjudication is a constitutional issue or other question of law; or

     (3) Requiring the person to exhaust any administrative remedy would result in undue prejudice because the person may suffer irreparable harm if unable to secure immediate judicial consideration of the claim. Provided, however, that the provisions of this subsection shall not apply to any matter covered by chapters 288, 302, and 303, RSMo.

     3. In any action arising pursuant to this section, the agency shall have the burden of proving by a preponderance of the evidence that the agency's rule, or threatened application of the rule, is valid, is authorized by law, is not in conflict with any law and is not arbitrary and capricious.

     4. For purposes of this section, the general assembly or its designee shall have standing, in law or equity, to intervene in any existing action. Unless otherwise provided by resolution, the general assembly's designee is the joint committee on administrative rules who may, upon a concurrence of a majority of the committee's members, file suit in the name of the committee's chairperson in his or her official and representative capacity. Nothing in this section shall confer upon the committee nor its chairperson any duty to so act or intervene.

     Section B. Because of the immediate need for consistency of rulemaking procedures, this act is deemed necessary for the immediate preservation of the public health, welfare, peace and safety, and this act is hereby declared to be an emergency act within the meaning of the constitution, and this act shall be in full force and effect upon its passage and approval.