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Home / Washington Business - September/October 2003 / General Business Issues |
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General Business Issues |
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Written On: September/October 2003 |
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SUMMARY
While the business community had a number of successes this legislative session and are pleased with the progress that our state is making, there are still many issues left unresolved at the close of the 2003 legislative session, including further efforts of regulatory and liability reform.
LIABILITY REFORM
With litigation costs continuing to spiral upward and predictability in trying to comply with the laws is continuing to deteriorate, liability matters are moving to the forefront of competitiveness issues in Washington state. This year AWB supported a major reform bill, SB 5728, which was amended but passed the Senate, only to die in the House. Next year will see this issue being pushed with even greater intensity.
REGULATORY REFORM
This year was a mixed bag of successes for regulatory reform. Governor Locke vetoed two bills that AWB supported but signed three others. The Governor refused to allow more jurisdictions for administrative procedures, and vetoed accountability options for new rules made by administrative agencies. AWB did see success in permitting requirements, rule making procedures, and serving notice to businesses. While other bills to curtail agencies from exceeding federal standards without legislative authority were passed by the Senate but not acted on in the House of Representatives.
DETAILS
SB 5728 – Comprehensive Liability Reform
SB 5728 attempted to implement comprehensive reform. There were seven components that covered everything from limits on noneconomic damages to greater protection for employers who provide reference checks.
Under current law, one business in a multi-party lawsuit can be required to pay 100 percent of all damages, even if the business is only found legally responsible for 10 percent of the loss. SB 5728 would have limited the damages to the percentage the jury found liable. So if a business were responsible for 20 percent of the negligence, it would only pay 20 percent of the liability.
SB 5728 would have also reformed medical malpractice lawsuits by placing caps on non-economic damages. The bill would have instituted a cap of $350,000 on all noneconomic
"pain and suffering" type damages. Economic costs, loss of income and medical costs would remain uncapped. A plaintiff would also be required to inform a defendant of the pending lawsuit 90 days prior to filing. (See Health Care section for more information on medical malpractice legislation.)
The bill also provided greater protection to contractors and governmental entities in addition to making other basic changes to liability law.
Regulatory Reform
HB 1530 - Change of Venue for Declaratory Judgments
HB 1530 would have allowed a declaratory action challenging an agency rule under the Administrative Procedure Act (APA) to be brought in Clark, Spokane, Whatcom, or Yakima counties, in addition to Thurston County. This bill brings fairness to the judicial process by increasing the number of jurisdictions in which legal action may be brought. AWB actively led the charge on this bill which was a recommendation of the governor’s Competitiveness Council recommendations. While the bill passed the House and Senate with strong bi-partisan support, Gov. Locke vetoed this bill.
HB 1531 - Requiring the Governor's Signature on Significant Legislative Rules
Another recommendation of the Governor’s Competitiveness Council was to provide greater accountability to the process for adopting agency rules by requiring that the governor provide his signature before the rule can go into effect. HB 1531 also passed the legislature with near unanimous support only to be vetoed by Gov. Locke. The bill provides that for significant legislative rules, adopted by agencies under the authority of the governor, the final order of adoption must also include the governor's signature.
HB 1550 - Office of Permit Assistance: Renaming and Revising Duties
This recommendation of the Governor’s Competitiveness Council was passed by the Legislature and signed into law by Gov. Locke. AWB supports HB 1550, which renames the Office of Permit Assistance to the Office of Regulatory Assistance. Duties of the Office of Regulatory Assistance include coordinating with state agencies to develop a website containing information about regulatory requirements for businesses and citizens of Washington. The website also provides information on the following:
• Federal, state, and local rule-making processes and permit requirements applicable to Washington businesses and citizens;
• Federal, state, and local licenses, permits, and approvals necessary to start and operate a business or develop real property in Washington;
• State and local building codes;
• Federal, state, and local economic development programs available to businesses in Washington; and
• State and local agencies regulating or providing assistance to citizens and businesses operating a business or developing real property in Washington.
ESB 5256 - Rulemaking Procedures for Cost Benefit Assessments
The Senate and House quickly agreed to language with the governor’s office on SB 5256 a bill clarifies the 1995 Regulatory Reform Act application of cost benefit assessments in the rulemaking process by requiring that a preliminary assessment is available for the public to comment before comment period is closed. The 1995 act requires that the public be provided a meaningful opportunity to comment on rule development prior to rule adoption. ESB 5256 makes it clear that "meaningful" means before adoption. This action upholds the Hillis v. DOE and AWB v. DOE decisions and clarifies the lower court decision on the WE CARE v. L&I case. Gov. Locke signed this legislation into law with AWB’s encouragement.
SB 5766 - Providing Businesses With Notice of Certain Administrative Rules
Gov. Locke also signed SB 5766 to partially implement the Competitiveness Council recommendations for agencies to provide notice of rules to affected parties. AWB supports this legislation which requires the departments of Employment Security, Labor and Industries, Ecology and Natural Resources to notify businesses affected by the rule of the rule's requirements, how the business can appeal the rule and how to get help in complying with the rule. This requirement applies from before or up to 200 days after the rule's effective date and only applies to rules that impose additional requirements on businesses, the violation of which subjects a business to penalties or sanctions. The requirement does not apply to emergency rules. These agencies must develop a process to make this communication available to those affected stakeholders. AWB will work to further expand this process to other state agencies that affect employers.
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