1. DENR Rulemaking: Impact Analysis (formerly Fiscal Notes) The Keys  Statutory requirements  OSBM State Budget Manual  DENR guidance

2. Objective of Impact Analysis The objective of an impact analysis is to estimate change due to the proposed rules Content:  Identify affected parties  Estimate types and amounts of expenditures  Describe purpose and benefits  Explain estimation procedures and sources of data

3. An Impact Analysis is NOT a Benefit/Cost Study Impact analysis as practiced by NC standards  is usually limited to five years  focuses on increases or decreases in costs or revenues  affected parties summarize to local governments, state agencies, federal agencies, and the private sector  benefit estimation is recommended but not required

4.  The current condition is the Baseline  The proposed rules describe the future state  The analysis is prepared to estimate the difference or the increment  *Impact analysis explanations should be simple yet complete enough so a lay person can follow your methods, logic, assumptions, and data*

5. Data Tips  Surveys to collect data are not required  Consult field staff or regulated parties for cost estimates  Examine division data bases to characterize affected parties  Borrow federally developed data, making it NC specific  Best Professional Judgement is acceptable  *Admit inability to estimate an impact rather than ignore it*  Prepare a summary table that transfers directly to the DENR Rulemaking Impact Analysis Form

6. Organizing the Analysis  Can be organized around affected parties or by rule  My preference: use the paragraph format with headings –Basic Information –Introduction –Purpose of Rule –Affected Parties –Estimate Costs –Describe Benefits –Summary Table –Substantial Impact Declaration

7. Points of Emphasis  DOT, DOT, DOT! For Environmental Permitting Rules: –Recognize DOT as a separate affected party –Insert the heading “DOT Impacts” in the cost estimation section –Maintain DOT identity in the summary table  Fee Increases and Gov Ops: –90 day option: safety valve for EVERY fee –Prepare and submit fee information form via BPA at the time of filing

8. What’s New?  OSBM Guidelines effective July 1, 2007  Requires added analysis for rule sets judged to be “significant”  Small business impacts  Suggests analysis of alternatives  Emphasizes quantifying benefits when feasible  Less scrutiny of small, routine, not significant filings  Section 7.0, page 174 of the State Budget Manual

9. Two Final Points Concerning Fiscal Notes  Submissions must be in electronic format; impact analysis, DENR Impact Analysis Form, and any attachments  Start the fiscal note as soon as you have the rules drafted. Call me to set up a consultation/training meeting. –Doug Lewis733-1710 –Doug.Lewis@ncmail.net