SB1267

Report Title:

Regulatory Processes; Automatic Approval

Description:

Amends the automatic approval law by clarifying legislative intent and what permits are covered, adding definitions, allowing for conditional approvals, amending application completeness and maximum time period requirements, adding extensions, and providing for a panel of board alternates.

THE SENATE	S.B. NO.	1267
TWENTY-FIRST LEGISLATURE, 2001
STATE OF HAWAII

A BILL FOR AN ACT

relating to regulatory processes.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. The Hawaii Revised Statutes is amended by adding a new chapter to be appropriately designated and to read as follows:

"Chapter

AUTOMATIC PERMIT APPROVAL

§ -1 Legislative purpose and intent. The legislature recognizes the need to take constructive steps to improve Hawaii's business climate. Businesses inside and outside of the State have described the lengthy and indeterminate time required for business and development-related regulatory approvals, and the duplicative nature of the approval process, as an area which requires immediate attention. Substantive changes to these processes must be made in order to send a strong signal to the business community of the State's intent to improve the overall regulatory climate.

The purpose of this chapter is to require the establishment of maximum time periods for the review and approval of all business and development-related permit approvals and licenses. Issuing agencies would be required to review applications for completeness in a timely manner and then to act upon the applications within an established time frame, or application approval would be automatic.

Maximum review and approval time periods would serve to provide all parties with a greater level of certainty of the time required for review and final determination by an agency on any application for a business or development-related permit, license, or approval.

This chapter is intended to avoid prejudice to applicants for business or development-related approvals that are the result of an agency’s deliberate, dilatory, or inexcusable inaction, and is not intended to adversely affect the public’s health, safety, and welfare.

§ -2 Definitions. For the purposes of this chapter:

"Maximum time period" means, as applicable:

(1) The time period for agency action specified in rules adopted by an agency pursuant to section -3(a); or

(2) The statutory time period specified in section -9(b).

"Parties in interest" means the petitioner, abutters, owners of land directly opposite on any public or private street or way, and abutters to the abutters within three hundred feet of the property line of the petitioner as they appear on the most recent applicable tax list, notwithstanding that the land of any such owner is located in another city or town, the planning board of the city or town, and the planning board of every abutting city or town.

"Permit" means any state or county application, petition, permit, license, certificate, or any other form of a request for approval required by sections 46-4, 46-4.2, 46-4.5, 46-5, and chapters 54, 149A, 150, 159, 161, 181, 183, 183B, 183C, 183D, 186D, 187A, 188, 189, 190D, 196D, 200, 205, 205A, 206E, 261, 261C, 262, 266, 269, 271, 271G, 273, 281, 286, 289, 321, 340A, 340B, 340E, 340F, 342B, 342C, 342D, 342E, 342F, 342G, 342H, 342I, 342J, 342L, 342P, 346, 396, 397, 412, 415, 415A, 415B, 419, 420, 421, 421C, 421H, 421I, 421J, 423, 424, 425, 425D, 428, 429, 431, 431K, 432, 432C, 432D, 435E, 436E, 436M, 437, 437B, 437D, 438, 439, 440, 440G, 441, 442, 443B, 444, 445, 446, 446E, 447, 448, 448D, 448E, 448F, 448H, 449, 451A, 451D, 451J, 452, 453, 454, 455, 456, 457, 457A, 457B, 457G, 458, 459, 460, 460J, 461, 461J, 462A, 463, 463E, 464, 465, 466, 466J, 466K, 467, 467B, 467E, 468E, 468L, 468M, 469, and 471.

§ -3 Maximum time period for permits; automatic approval. (a) Unless otherwise provided by law, an agency shall adopt rules that specify a maximum time period to approve, approve with conditions, or disapprove a permit; provided that the application is not subject to state administered permit programs delegated, authorized, or approved under federal law.

(b) All such issuing agencies shall clearly articulate informational requirements for applications and review applications for completeness in a timely manner. The maximum time period shall begin after:

(1) The agency has notified the applicant, in writing, that the application is complete; and

(2) Acceptance of a final environmental impact statement or a finding of no significant impact pursuant to chapter 343, as applicable, or a finding by the agency that the application is exempt from chapter 343.

(c) All such issuing agencies shall take action to approve, approve with conditions, or disapprove any application for a permit within the established maximum period of time, or the application shall be deemed approved; provided that:

(1) No application shall be deemed approved under this subsection until thirty days after public notice of the impending deadline shall have been published in the periodic bulletin published by the office of environmental quality control pursuant to section 343-3(d);

(2) Where an agency has made a good-faith consideration of an application for a permit that results in a tie vote, the tie vote shall not result in the automatic approval of that application;

(3) An automatic approval does not limit the right of an agency to suspend, limit, revoke, or change a permit for failure of the applicant to comply with applicable laws or rules; and

(4) Agencies may adopt rules specifying that the maximum time period shall begin to run after the completion of a contested case hearing, in which case the maximum time period shall apply to the agency's deliberation on a decision after the record for decision-making has been closed.

§ -4 Extensions. The maximum period of time established pursuant to this section shall be extended:

(1) In the event of a national disaster, state emergency, or union strike, which would prevent the applicant, the agency, or the department from fulfilling application or review requirements;

(2) If a specific state statute, federal law, or court order requires a process to occur before an agency can take action on an application, and that process makes it impossible to act on the request within the established maximum time period, in which case the time limit may be extended after completion of the last process required in the applicable state statute, federal law, or court order;

(3) If the inaction was the result of excusable neglect, inadvertence, ignorance, or misunderstanding, and not due to dilatory inaction by an agency;

(4) If a moratorium was imposed for the issuance of any permit;

(5) If the applicant has made a material or substantial change to the initial application after the agency had determined the application to be complete;

(6) If the applicant, in writing, has requested an extension of the maximum time period;

(7) The agency has determined that the due process rights of the applicant or any other party in a contested case hearing would be adversely affected by any time limitations that may arise as a result of the established maximum time period; or

(8) An agency has provided written notice of the extension to the applicant, stating the reasons for the extension and its anticipated length, which may not exceed sixty days unless approved by the applicant.

§ -5 Mandatory conditions. Agencies may adopt rules that impose specific mandatory conditions on automatically approved permits in order to:

(1) Protect public health and safety; and

(2) Protect constitutionally mandated areas, including article XI, sections 1, 3, and 7, and article XII, section 7 of the Hawaii constitution.

§ -6 Certificate of automatic approval; appeals. (a) An applicant who seeks approval by reason of the failure of an agency to act within the maximum time period shall notify the agency, in writing, within fourteen days from the expiration of the maximum time period, including any extensions, if applicable, of that approval and the fact that notice has been sent by the applicant to parties in interest.

(b) The applicant shall send notice to parties in interest by mail, and each notice shall specify that appeals, if any, shall be made pursuant to chapter 91 and shall be filed within twenty days after the date the agency received the written notice from the applicant that the agency failed to act within the maximum time period.

(c) After the expiration of twenty days without notice of appeal, or, if appeal has been taken, after receipt of certified records of the court in which the appeal is adjudicated, indicating that the approval has become final, the agency shall issue and forward to the applicant a certificate stating:

(1) The date of approval;

(2) The fact that the agency failed to take final action; and

(3) That the approval resulting from that failure has become final.

§ -7 Record; voting; notice of decision. (a) The agency shall cause to be made a detailed record of its proceedings, indicating the vote of each member upon each question, or, if absent or failing to vote, indicating that fact, and setting forth clearly the reason for its decision and of its official actions, copies of all of which shall be filed within fourteen days in the office of the director of the agency and shall be a public record.

(b) Notice of the decision shall be mailed forthwith to the applicant, to the parties in interest, and to every person present at the hearing who requested that notice be sent to that person and stated the address to which such notice was to be sent. Each notice shall specify that appeals, if any, shall be made pursuant to chapter 91 and shall be filed within twenty days after the date of filing of the notice in the office of the director of the agency.

§ -8 Panel of alternates; designation of alternate members to act. (a) Each agency, board, or commission that is required to take action under this chapter by voting on an application for a permit shall provide for the selection of three alternate members as provided in section 26-34 or as otherwise provided by law, and shall be referred to as "the panel of alternates". When called upon to vote on an application for a permit pursuant to subsection (b), the members of the panel of alternates shall have the same powers and duties relating to official acts as the other members of the agency, board, or commission. Any vacancy in the panel of alternates shall be filled for the unexpired term in the same manner as the original appointment.

(b) For the purposes of voting to approve, approve with conditions, or disapprove an application for a permit under this chapter, if a regular member of an agency, board, or commission, is absent, is recused due to a conflict of interest, or cannot vote on the application for any other reason, that member may designate an alternate from the panel of alternates to act in the member's place. If the member fails to make such a designation, or if the member is disqualified, the director of the agency or the chairperson of the board or commission, as applicable, shall designate an alternate from the panel of alternates, choosing alternates in rotation so that they shall act as nearly equal a number of times as possible. If any alternate is not available in accordance with the rotation, that fact shall be recorded in the minutes of the meeting.

§ -9 Rulemaking. (a) Agencies that are subject to this chapter shall adopt rules to implement this chapter by December 31, 2003.

(b) The failure of an agency to comply with subsection (a), as determined by the lieutenant governor, shall result in a maximum time period of three hundred and sixty five calendar days for each such agency for the purposes of this chapter; provided that this maximum time period shall begin after:

(1) An agency has determined an application for a permit to be complete; and

(c) Agencies that are subject to the maximum time period under subsection (b) may continue to adopt rules to implement this chapter after the maximum time period under subsection (b) becomes applicable; provided that the agency may not change that maximum time period by rule."

SECTION 2. Section 91-13.5, Hawaii Revised Statutes, is repealed.

["~~[§91-13.5] Maximum time period for business or development-related permits, licenses, or approvals; automatic approval; extensions.~~ (a) Unless otherwise provided by law, an agency shall adopt rules that specify a maximum time period to grant or deny a business or development-related permit, license, or approval; provided that the application is not subject to state administered permit programs delegated, authorized, or approved under federal law.

~~(b) All such issuing agencies shall clearly articulate informational requirements for applications and review applications for completeness in a timely manner.~~

(c) All such issuing agencies shall take action to grant or deny any application for a business or development-related permit, license or approval within the established maximum period of time, or the application shall be deemed approved.

(d) The maximum period of time established pursuant to this section shall be extended in the event of a national disaster, state emergency, or union strike, which would prevent the applicant, the agency, or the department from fulfilling application or review requirements.

(e) For purposes of this section, "application for a business or development-related permit, license, or approval" means any state or county application, petition, permit, license, certificate, or any other form of a request for approval required by law to be obtained prior to the formation, operation, or expansion of a commercial or industrial enterprise, or for any permit, license, certificate, or any form of approval required under sections 46-4, 46-4.2, 46-4.5, 46-5, and chapters 183C, 205, 205A, 340A, 340B, 340E, 340F, 342B, 342C, 342D, 342E, 342F, 342G, 342H, 342I, 342J, 342L, and 342P."]

SECTION 3. Act 164, Session Laws of Hawaii 1998, is amended by deleting section 4:

["SECTION 4. All agencies shall adopt rules as required by section 3 of this Act on the first occasion that the agency's rules are amended upon approval of this Act or by December 31, 1999, whichever is earlier."]

SECTION 4. Agencies that administer state permit programs delegated, authorized, or approved under federal law shall:

(1) Review the statutory references specified in section 91-13.5(e), Hawaii Revised Statutes, to determine the specific programs in those chapters to which section 91-13.5 applies;

(2) Make findings and recommendations as to whether all or portions of the affected chapters consist of "state administered permit programs delegated, authorized, or approved under federal law", as provided under section 91-13.5(a); and

(3) Report findings and recommendations to the legislature no later than twenty days before the convening of the regular session of 2002.

SECTION 5. The attorney general shall:

(1) Develop and propose model rules for state and county agencies to implement section 91-13.5, Hawaii Revised Statutes;

(2) Make the model rules available to all state and county agencies, either by mail to each agency or on the attorney general's Internet website; and

(3) Assist agencies in finding solutions to problems involved in implementing section 91-13.5.

SECTION 6. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 7. This Act shall take effect upon its approval.

INTRODUCED BY:	_____________________________