CA Regulatory Explainer: OAL’s Six Standards of Review for Proposed Regulations

CA Regulatory Explainer: OAL’s Six Standards of Review for Proposed Regulations By Chris Micheli

            California’s Office of Administrative Law (OAL) plays several roles concerning the rulemaking activities of the state’s two hundred regulatory agencies, departments, boards, and commissions. There is not just the “regular” rulemaking, but also emergency rulemaking, and even review of “underground” regulations.

            Most agencies enjoy broad grants of rulemaking authority by statute. In some instances, the Legislature has provided a limited grant of authority in order to adopt regulations. Most of those two hundred regulatory entities have adopted regulations. And, OAL reviews over 500 regulations per year.

When OAL reviews regulations, its review is dictated by the California Administrative Procedure Act (APA), which is found in the Government Code, and the APA sets forth six standards by which OAL determines whether a regulation was properly adopted. Those standards are defined in the California Government Code and there are numerous court decisions interpreting all six standards to provide further guidance.

Those standards are:

Authority and Reference Standards  

The Authority Standard is basically reviewing whether the proposed regulation states the provision of law which authorizes or requires the proposed regulation.

            The Reference Standard is basically reviewing whether the proposed regulation cites the law which is being implemented or interpreted.

According to OAL, complying with the Authority and Reference standards involves a rulemaking agency in two activities:  picking appropriate Authority and Reference citations for the note that follows each regulation section to be printed in the California Code of Regulations, as well as adopting a regulation that is within the scope of the rulemaking power conferred on the agency.

By law, each regulation section printed in the California Code of Regulations (CCR) must have a citation to the specific statutory authority under which it was enacted and a citation to the specific statute or other provision of law that the regulation is implementing, interpreting, or making specific. If the underlying statute does not expressly or impliedly provide authority for the proposed regulation, then it is void.

Consistency Standard

            This standard is basically reviewing whether the proposed regulation is in harmony with and not in conflict with other laws.

In this regard, the review focuses on whether the proposed regulation is consistent with the underlying statute. According to OAL, consistency is viewed as whether the regulation is reasonably designed to aid a statutory objective, does not conflict with or contradict (or alter, amend, enlarge, or restrict) any statutory provision, etc.

Clarity Standard

This standard is basically reviewing whether the proposed regulation is easily understood by those are who affected by it.

            According to OAL, regulations are frequently unclear and unnecessarily complex, even when the technical nature of the subject matter is taken into account. They are often confusing to persons who must comply with them.

The intent of this standard is to ensure that the rulemaking agency drafts its regulation text in plain, straightforward language avoiding technical terms as much as possible using coherent and easily readable language. As such, OAL attempts to ensure that each regulation can be easily understood by those who are regulated and avoid instances where a regulation is unclear to the regulated community.

Nonduplication Standard

            This standard is basically reviewing whether the proposed regulation does not serve the same purpose as any other state law or regulation.

OAL explains that a regulation cannot simply repeat or rephrase a statute. In other words, a regulation cannot "serve the same purpose" as that of an existing statute or regulation. If it does, there must be some justification in doing so.

Necessity Standard

            This standard is basically reviewing whether the need for the proposed regulation has been demonstrated by substantial evidence.

The rulemaking entity must have a complete rulemaking file when it submits the final product to OAL. That rulemaking file must include all materials and background upon which the proposed regulation is based. The Initial and Final Statements of Reasons must be thorough to explain why the provision is reasonably necessary to accomplish the stated purpose.

The rulemaking file must also identify and include in the record any materials relied upon in proposing the provision and any other information, statement, report, or data the agency is required by law to consider or prepare in connection with the rulemaking action.

OAL is limited in its review of the record of rulemaking proceedings as well as the rulemaking file itself. Moreover, a court reviewing the regulation will be limited to the documents contained in that rulemaking record. As such, it is important for the rulemaking agency to comply with all of the requirements of the APA and ensure that their rulemaking file is complete.

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