LEGISLATIVE FISCAL ESTIMATE

[First Reprint]

SENATE, No. 4373

STATE OF NEW JERSEY

221st LEGISLATURE

 

DATED: JANUARY 9, 2026

 

 

SUMMARY

 

Synopsis:

Makes various changes to provisions of “Administrative Procedure Act”; establishes Commission on Efficiency and Regulatory Review in Office of Administrative Law.

Type of Impact:

Annual net impact on State and local expenditures.

Agencies Affected:

Office of Administrative Law in the Department of the Treasury; State agencies; local units.

 

 

Office of Legislative Services Estimate

Fiscal Impact

 

Annual 

 

 

Net Impact on State Expenditures

 

Indeterminate

 

 

Net Impact on Local Expenditures

 

Indeterminate

 

 

 

·         The Office of Legislative Services (OLS) estimates that making various changes to the Administrative Procedure Act and establishing the Commission on Efficiency and Regulatory Review will have an indeterminate net impact on annual State and local expenditures.

 

·         The OLS estimates that the establishment of the Commission on Efficiency and Regulatory Review in the Office of Administrative Law will result in expenditure increases due to the commission’s required analysis and recommendation on rules, regulations, executive orders, and regulatory programs and the submission of the commission’s annual report.

 

·         The establishment of the commission may also lead to a decrease in expenditures for State agencies and local units if the commission recommends amending, rescinding, or repealing rules, regulations, or executive orders where the costs outweigh the intended benefits or place an undue burden on local governments.  The OLS notes that the recommendations made by the commission will only have a fiscal impact if they are adopted and implemented by the respective State agency, the Governor, or the Legislature.

·         The OLS also estimates that the changes made to the Administrative Procedure Act will result in annual expenditure increases to State agencies due to the additional materials and steps required when proposing a rule.

 

 

BILL DESCRIPTION

 

      This bill makes various changes to the Administrative Procedure Act and establishes the Commission on Efficiency and Regulatory Review in the Office of Administrative Law in the Department of the Treasury.

      Under this bill, the Commission on Efficiency and Regulatory review is responsible for reviewing rules and regulations issued by State agencies and executive orders issued by the Governor to assess the economic impact and ensure efficiency in their implementation.  The commission would consist of one member of the public and 12 members of the Executive Branch and Legislature, or their designees.  The members of the commission would be reimbursed for travel and other reasonable expenses incurred in association with their service.

      This bill requires the commission to review all rules and regulations proposed and adopted by State agencies and operative executive orders issued by the Governor to: assess their potential or actual effects on the State's economy; determine whether their costs and other burdens on businesses, workers, and local governments outweigh their intended benefits; and establish a basis for providing recommendations to the Governor for the amendment, rescission, or repeal of any rules, regulations, or Executive Orders that unduly burden the State's businesses, workers, and local governments.  The commission is also required to formulate recommendations concerning State regulatory programs that may be delegated to licensed professionals or local governments.

      This bill also grants the commission the authority to request data and information, personnel, or assistance from any department, office, division, or agency as deemed necessary to implement the provisions of the bill.

      The commission is required to submit an annual report to the Governor and the Legislature describing the commission’s activities and recommendations.  Each department, office, division, or agency is required to assist the commission with the report by providing the necessary information and personnel.

      Additionally, this bill makes various changes to the Administrative Procedure Act.  When proposing a rule, the bill requires: an assessment of the proposed rule’s effect on the State’s economy; a cost-benefit analysis of the proposed rule; an Office of Administrative Law review and certification of the adequacy of the statement and analysis submitted by the agency; and the reports, data, and studies used to be made available to the public upon the publication of the rule proposal.  This bill also requires an agency to file a notice of intent for each rule proposal at least 90 days prior to the formal notice of action for the rule proposal, as well as accept public comment.

 

 

FISCAL ANALYSIS

 

EXECUTIVE BRANCH

 

      None received.

OFFICE OF LEGISLATIVE SERVICES

 

      The OLS estimates that making various changes to the Administrative Procedure Act and establishing the Commission on Efficiency and Regulatory Review will have an indeterminate net impact on annual State and local expenditures.

      The establishment of the Commission on Efficiency and Regulatory Review will increase administrative costs for the Office of Administrative Law due to the commission’s required review and analysis of rules and regulations issued by State agencies and executive orders issued by the Governor, recommendations for any changes, and the submission of an annual report. 

      The commission’s creation may also lead to an increase in administrative costs for other State and local units due to the commission’s ability to request data and information, personnel, or assistance from any department, office, division, or agency as deemed necessary to implement the provisions of the bill, including the submission of the commission’s annual report.

      The establishment of the Commission on Efficiency and Regulatory Review may also lead to a decrease in expenditures for State agencies and local units if the commission recommends amending, rescinding, or repealing rules, regulations, or Executive Orders where the costs outweigh the intended benefits or place an undue burden on local governments.  Alternatively, some of the commission’s recommendations may lead to an increase in expenditures for local units if the commission decides to delegate regulatory programs from State agencies to local governments.  The OLS notes that the recommendations made by the commission will only have a fiscal impact if they are adopted and implemented by the respective State agency, the Governor, or the Legislature.

      The OLS also estimates that the changes made to the Administrative Procedure Act will result in annual expenditure increases to State agencies due to the economic assessment and cost-benefit analysis required when proposing a rule.  State agencies may also experience increases in administrative costs due to making materials available to the public and filing notices of intent for each rule proposal.  Additionally, the Office of Administrative Law may experience increases in administrative costs due to the required review and certification of the socio-economic impact and cost-benefit analysis statement submitted by an agency.

 

 

Section:

State Government

Analyst:

Camryn Mathews

Associate Fiscal Analyst

Approved:

Thomas Koenig

Legislative Budget and Finance Officer

 

 

This legislative fiscal estimate has been produced by the Office of Legislative Services due to the failure of the Executive Branch to respond to our request for a fiscal note.

 

This fiscal estimate has been prepared pursuant to P.L.1980, c.67 (C.52:13B-6 et seq.).