Noting the “devil is in the details,” NJBIA urged an Assembly committee on Monday to reform the state rulemaking process to ensure that when state agencies implement laws, the final regulations they adopt are not overly burdensome and contrary to legislative intent.
NJBIA Deputy Chief Government Affairs Officer Ray Cantor made the case for regulatory reform in his testimony to the Assembly Oversight, Reform and Federal Relations Committee, which is gathering feedback on proposed changes to the NJ Administrative Procedure Act (APA). The APA sets out the rules that state agencies must follow when creating regulations, including requirements for public notice, comment, and transparency in the rulemaking process.
“While the Legislature sets the overall policy framework of a program, often the substantive details and implementation are left for departments and agencies to determine,” Cantor said. “As they say, the devil is in the details, and those details are developed under the APA rulemaking process.”
Cantor said that when regulations are overreaching, contrary to legislative intent, or too costly, the regulated community – which means New Jersey businesses, local governments, and ordinary citizens – are left in an untenable position.
“The remedies to change those regulations, once adopted, are burdensome, costly, and most often, ineffectual. That is why it is so important to get the regulations right, even after the Legislature has set the overall parameters in law,” Cantor said.
Cantor pointed to the land use rules adopted by the Murphy administration’s Department of Environmental Protection as an example of what happens when agencies draft costly rules that rely on outdated scientific data and adopt them without meaningful stakeholder input. The DEP’s NJ PACT REAL rules are now being challenged in court by the NJ Builders Association and NJBIA, and this could have been avoided if the APA process had been different, he said.
Cantor noted that Gov. Mikie Sherrill, who took office after the NJ PACT REAL rules were adopted, is committed to cutting red tape and streamlining permitting. However, reforming the state permitting process cannot succeed without also reforming the state rulemaking process.
“You can have the best intentions to expedite permitting, but if a regulation mandates onerous requirements or impractical standards be met, nothing will change,” Cantor said.
Cantor recommended five changes be made to the APA:
- Stakeholder meetings be mandatory
- Pre-drafts for major rules be required
- There be an external body to review rules and impact statements
- Changes be allowed to be made upon adoption
- The courts, not state agencies, be the decider on matters of law
For further details, read Cantor’s testimony here.
The bill before the committee on Monday, A-1505, sponsored by Assemblyman Roy Freiman (D-16), was for discussion-only so lawmakers could gather testimony from interested stakeholders before scheduling a vote at a later date.
