1. DAPC Program Update Seminar December 6, 2011 DAPC R ULES U PDATE

2. T ODAY ' S T OPICS  The Rule Process – an Overview  Senate Bill 2/Executive Order 2011-01K  2011 – Year in Review  In the Hopper  SIP Conduit

3. T HE R ULE P ROCESS – AN O VERVIEW  Ohio Revised Code = Laws/Statutes  Ohio Administrative Code = Rules/Regulations DAPC Makes Rules! 469 Rules in Chapter 3745 of the Administrative Code

4. T HE R ULE P ROCESS – AN O VERVIEW  Two Paths – 5 year review and Non-5yr  5 Year Review  What is it? – ORC 119.032  Determine if rule is.... Necessary: Changes or No Change Unnecessary: Rescission  Must review whole rule. Make content changes, but also; Fix Typos, Admin Data, IBR’s, etc...  Non-5yr: typically just a content change

5. T HE R ULE P ROCESS – AN O VERVIEW  Typical Rule Schedule (180 – 255 Days)  Content Development – Prior to rule path  Draft Rule (IP) Comment Period  Proposal Period Public Hearing JCARR jurisdiction - 65 days Regular, 90 Days No-change  JCARR = Joint Committee on Agency Rule Review  JCARR jurisdiction includes JCARR hearing  No public hearing for no-change rules

6. T HE R ULE P ROCESS – AN O VERVIEW  Typical Rule Path – continued  Final File Package Package Review and Sign-off (15-30 days) Final file (can be done first day after JCARR jurisdiction is over) First possible effective date is 10 days after final filing  Revising (if necessary) If change necessary within the first 35 days of JCARR jurisdiction Does not lengthen timeframe  Refiling (if necessary) If change necessary after the first 35 days of JCARR jurisdiction Could lengthen timeframe considerably (30 day JCARR extension)  Also Emergency and No-Change

7. G UIDANCE D OCUMENTS  DAPC has developed many guidance documents  “Rule Generating and Processing Guidance”  “Rule Drafting and Formatting Guidance”  Rule package document templates  Additional outside guidance available  LSC Rule Drafting Manual  RAS/ERF Training Manuals

8. E XECUTIVE ORDER 2011-01K  Became effective on January 10, 2011 and will remain effective even after the SB 2 CSI provisions apply  Created the Common Sense Initiative (CSI)  Under the EO, agencies are to “promote transparency, consistency, predictability, and flexibility in regulatory activities.”  The Executive Order directs agencies to continually evaluate regulations to ensure the regulatory objectives are being accomplished. Agencies are also instructed to “amend or rescind rules that are unnecessary, ineffective, contradictory, redundant, inefficient and needlessly burdensome, have a negative unintended consequence, or unnecessarily impede business growth.”

9. E XECUTIVE ORDER 2011-01K  Rule Drafting  The Executive Order specifically calls for agencies to establish business regulations via rule-making procedures and to write rules, regulations, and related communication in plain English so that they may be easily understood.  Determining Impact on Small Business  The Executive Order further requires that, before filing a rule that economically impacts small business with JCARR, agencies must determine the rule’s real or potential impact on small business and comply with CSIO requirements for determining that impact.

10. E XECUTIVE ORDER 2011-01K  Balancing Rule Objectives  The EO specifies that the objectives of rules should be properly balanced with the costs of compliance by regulated parties, and that the perspectives of small businesses should be considered as early as possible in the rulemaking process.  Agencies must respond to any recommendations for improved regulations issued by the Lieutenant Governor through the CSIO. Recommendations that are adopted should be identified, and an explanation should be provided for those recommendations the agency elects not to implement.

11. S ENATE B ILL 2  Subsequent to the issuance of the Executive Order, the Ohio Legislature enacted Amended Substitute Senate Bill 2 (SB2).  SB2 more broadly seeks to identify and limit adverse impacts on businesses regardless of size.  Although SB2 itself was effective beginning June 7, 2011, many provisions will not be effective until January 1, 2012.  SB2 codifies the creation of the CSIO, alters the procedure for promulgation of agency rules, and expands the jurisdiction of JCARR.  Under SB2, a rule that might have an adverse impact on business is subject to additional analysis by the agency proposing it, the CSIO, and JCARR.

12. C OMMON S ENSE I NITIATIVE O FFICE  Under SB2 the CSIO has three primary tasks:  the creation of a process for people to comment on a proposed or effective rule’s adverse impact on business,  the development of an instrument to be used to evaluate rules that may have an adverse impact on business, and  the evaluation of draft rules and transmission of recommendations to eliminate or reduce any adverse impact on business.

13. S ENATE B ILL 2  For purposes of these requirements, a rule has an adverse impact if it…  requires an authorization before engaging in or operating a business;  imposes a penalty or sanction (criminal or civil), or creates a cause of action for failure to comply; or  requires specific expenditures or the reporting of information as a condition of compliance.

14. JCARR P ROCESS  All processes will remain the same, except for the addition of the Business Impact Analysis being added to the original filing package on the ERF.  If JCARR finds that a rule should have a Business Impact Analysis and one has not been filed with the rule, then JCARR can reject the rule, and it is like the rule filing never happened. The agency will have to start again.  JCARR will be determining the balance between the rule objective and the adverse impacts, the added 6th prong.

15. 2011 – Y EAR IN R EVIEW  New Rules  Greenhouse Gas Tailoring Rules – OAC Rules 3745- 31-34 and 3745-77-11  Notable Adoptions  OAC Chapter 3745-18 – 5yr Review, Removal of Limits for Permanently Closed Facilities  OAC Rule 3745-14-05 – Return of 240 Allowances to Affected Sources  OAC Chapter 3745-21 – Phase 3 VOC RACT; 3 new CTG Rules  Hundreds of Minor Changes due to 5-yr review of 7 Other Chapters

16. R ULE A CTIONS – 5 YR R EVIEWS 2005 - 2011

17. R ULE A CTIONS – N EW R ULES 2005 - 2011

18. T OTAL R ULE A CTIONS 2005 - 2010

19. C OMING U P IN 2012  5 Year review: Time to Reset, however.....  2011 was largest Year yet (300+ Rule Actions)  Still 3 Chapters that aren’t done from old cycle (3745- 31, 3745-102, 3745-114)  Rules in 9 Different Chapters, 50+ rules, set to start in 2012 2012 is not going to be a slow rule year!

20. I N THE H OPPER – W HAT ARE WE WORKING ON AS OF 12/6/11  Asbestos Emission Control (3745-20): Public Hearing on January 9, 2012  PM Rule Fix (3745-17-11): Adopting minor rule change in Early December to make rule federally approvable  Small Business Assistance (3745-79): Public Hearing on January 9, 2012  Open Burning Rules (3745-19): Public Hearing in Mid January, 2012

21. SIP A PPROVALS IN 2011  OAC Rule 3745-21-25: Approved 7/13/11, 76 FR 41086, Federally effective 8/12/11 – VOC RACT for Reinforced Plastic Composites Industry  OAC Rule 3745-21-07: Approved 8/19/11, 76 FR 51091, Federally effective 9/19/11 – Photo Reactive Materials. Replaces 1999 version of the rule in the SIP.  Cincinnati Redesignation to Attainment for 1997 PM 2.5 Annual Standard: Approved 10/19/11, 76 FR 64825, Likely Federally Effective 12/19/11