Administrative Procedure Act Amended

Administrative Procedure Act Amended

Concluding a prolonged push by regulated entities for a more open and deliberative rule-making process, Governor Whitman signed amendments (S-1306/A-1484) to the Administrative Procedure Act ("APA" or "Act") into law on January 12, 2001 (P.L. 2001, Ch.5).  The APA, first enacted in 1968, establishes the procedures that State agencies must follow in adopting regulations.  As reported in the April and July 2000 issues of <I>UPDATE</i>, the amendments revise several facets of the APA, from publication of agendas to codification of "sunset" provisions for administrative rules after five years.

The amendments seek to expand public awareness even before proposed regulations are published, through mandatory publication in the <I>New Jersey Register</i> of quarterly calendars that set forth each agency's rule-making plans for the following six months.  The new legislation also increases the rigor with which petitions for regulatory modification by interested persons are handled.  although agencies are given 30 additional days to respond to petitions and now have the ability to refer the matter for further deliberations, the petitioner is given the ability to initiate a public hearing if the agency fails to act within the new timeframe.

At the stage of rule proposal, the amendments afford greater opportunity for public input.  Proposed regulations, which must be written in a reasonably simple and informative manner, are to be more widely distributed.  If there is "sufficient public interest," as will be defined by each agency, to extend a comment period, the particular agency is required to extend the comment period by 30 days.  Also under the revised APA, an agency must hold a public hearing whenever sufficient public interest in a hearing exists.  This is a significant change from the prior law, which generally required a public hearing only at the request of a committee of the Legislature or a governmental agency.

Other noteworthy aspects of the amendments include streamlined regulatory impact statements, establishment of a Regulatory Impact Analysis Advisory Task Force to review current impact analysis requirements and recommend changes, and mandatory inclusion of a table of permits, fees, violations, penalties, deadlines, processing times and appeals procedures in an agency's regulations.

Finally, somewhat tangential to the promulgation of regulatory reform, the new law establishes a standard of review in contested cases brought to an agency head for final decision after an initial decision by an administrative law judge ("ALJ").  Under the Act as amended, an agency head must state clearly the reasons for any modifications or rejections of the ALJ's findings of fact or conclusions of law, and cannot disturb a finding of fact related to lay witness testimony unless the finding is not supported by sufficient, competent, and credible evidence.

The law is to take effect on July 1, 2001.

-- This issue's lead article was prepared by Hedy R. Bernard and Jacqueline F. McGowan