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October 10, 2011
Governor Signs Economic Impact Analysis Requirement
The Governor signed SB 617, a statewide requirement
for an economic impact analysis on major regulations
to be done at the beginning of the regulatory
process.
Specifically, SB 617 reforms the regulatory process
by requiring an economic analysis of all major
regulations at the beginning of the regulatory
process, thus providing more transparency and better
data on which to base selection of most
cost-effective regulatory alternative.
This analysis will then drive the development and
selection of regulations that fully meet the goals
of the underlying statute while having the least
negative impact on the state’s economy. If the
agency adopts anything other than the most
cost-effective option, it must state on the record
why and justify its choice. Currently a proposed
regulation’s fiscal analysis, if any, comes at the
end of the process and is not based on uniform
standards of analysis.
Economic growth and prosperity depends on a
predictable and rational regulatory climate. SB 617
sends a message to investors and employers that
California is taking a meaningful step in this
direction by requiring a robust economic analysis
for major regulations. Additionally, this bill
provides for a more transparent regulatory process
as well as oversight for state agencies that are
involved in the process.
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