As Trump Slashes Federal Regulations on Climate & Health, Senator Wiener Introduces Bill To Strengthen California’s Ability to Set Its Own Standards
SB 1123 will streamline the process of setting major regulations that have a significant public benefit, empowering California to set standards that protect the public from climate change, protect consumers from unfair business practices, set healthcare standards, and rein in wealthy corporations.
SAN FRANCISCO – Senator Scott Wiener (D-San Francisco) introduced Senate Bill (SB) 1123, legislation to streamline the process of adopting major regulations that have significant public benefits. The current process California uses to enact major regulations — such as those that protect Californians from asthma-inducing pollutants or scams against seniors — requires a lengthy assessment of the regulation’s potential impact on the economy, especially industry. SB 1123 would broaden the standards that trigger such an assessment to also include benefits to the public, helping critical public safeguards avoid costly delays.
SB 1123 is timely and critically important in light of the Trump Administration’s crusade to destroy federal protections of the public. Last week, the Administration eliminated the EPA’s greenhouse gas endangerment finding, undermining the federal government’s ability to regulate climate emissions from vehicles, power plants, industrial plants, and other sources. Some are calling for California to set its own regulations to fill the void. To do so would require completing a “major regulatory impact assessment,” a process agencies report can take an average of 590 days and cost taxpayers $1.2 million.
SB 1123 could help bypass this expensive delay for major regulations with a significant public benefit by shifting to a system where agencies must account for any offsetting benefits for the proposed regulation when determining whether a proposed regulation would result in an economic impact greater than $50 million.
“Far too often, promises of sweeping action from our elected leaders splinter and shrink when they hit the rocks of agency implementation,“ said Senator Scott Wiener. “Big corporations that lose in the Legislature — with a bill passing and being signed by the Governor — get a second bite at the apple by working overtime through their lobbyists and lawyers to gum up administrative implementation. It’s unacceptable. Once the people’s elected representatives enact a law, the law should be implemented quickly. As someone who has passed my share of major laws to protect the public, I know firsthand that the time between making those promises and seeing the impacts in people’s lives has become far too long. If we want people to trust in government again, we need to make it possible to deliver on big promises without years of expensive and unnecessary paperwork and bureaucratic review processes that give wealthy and powerful players a back door to tear apart major regulations bit by bit. SB 1123 takes an important step toward reforming our broken regulatory process, and it’s critical we pass it to empower California to step up where the federal government is failing us today.”
In 2011, Senate Bill 617 (Calderon) was signed into law establishing additional regulatory impact assessment standards for major regulations with a projected regulatory impact on business and residents of over $50 million. Then in 2013, The Department of Finance (DOF) adopted regulations for state agencies to follow when conducting a Standardized Regulatory Impact Assessment (SRIA) which takes into account quantitative, monetary, and nonmonetized impacts.
However, as a result of DOF’s regulations, when the economic impact of a regulation is being assessed, an agency must take into account the absolute value of all benefits and costs of the proposed regulatory action, instead of the net benefits.
This means that if the proposed rulemaking action is anticipated to produce $26 million in benefits and $25 million in costs, per the current department’s calculations, it would result in an economic impact of $51 million, triggering a major regulation and delaying the process. SB 1123 would require an agency to account for any offsetting benefits from the proposed regulation when determining whether a proposed regulation would result in an economic impact greater than $50 million.
A bill intended to require agencies to assess the costs of a proposed rulemaking has resulted in a process that is now frequently leveraged to impede the implementation of any legislative victory. This process frequently offers the state’s wealthiest corporations a unique path to delay, frustrate, and raise the cost of implementing legislatively intended oversight and implementation, even when such oversight would self-evidently save the state money.
Completing a SRIA is a lengthy, expensive process for agencies. Agencies that anticipate promulgating a major regulation must submit a list of all their anticipated major regulations no later than February 1st or no later than 60 days prior to filing a notice of proposed action with OAL. Once an agency, like CARB, has completed the SRIA, the SRIA must submit the completed assessment to the Department of Finance who then has 30 days to review the completed assessment.
In order to develop the assessment itself, the agency must engage in significant stakeholder engagement and expert consultation. This is true even if the regulation would result in a benefit to the public that vastly exceeds the projected costs of a regulation. The resulting SRIAs range from 50 to over 150 pages long and can delay the adoption of regulations for a few months or several years. DOF may also comment on agency SRIAs, further delaying the adoption of regulations as the regulating agency must revise their assessment.
Over 300 regulations were subject to the major regulations process between 2014 to 2026. This includes agencies such as the: Governor’s Office of Business and Economic Development, Department of Insurance, California Department of Resources Recycling and Recovery, California Health Benefit Exchange, Department of Conservation, Franchise Tax Board, Department of Industrial Relations, State Water Resources Control Board, CalCannabis, Managed Health Care, California Secure Choice Retirement Savings Investment Board, CalEPA, Board of Forestry and Fire Protection, California Highway Patrol, California Department of Alcoholic Beverage Control, Department of Justice, Department of Public Health, Department of Tax and Fee, Department of Transportation, Department of Fish and Wildlife, Department of Food and Agriculture, Department of Pesticide Regulation, California Privacy Protection Agency, CalSavers Retirement Savings Board, California Air Resources Board, California Energy Commission, and California Department of Public Health.
SB 1123 is sponsored by the Consumer Federation of California.
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