SECTION 1. Whereas, water, wastewater and stormwater systems are in need of major improvements in order to continue to protect public health, safety and the environment; and

Whereas, the costs for these improvements are significant and increasing each year; and

Whereas, local ratepayers and taxpayers bear the majority of costs associated with making these improvements as the Federal and State governments have reduced their level of funding assistance to cities, towns and districts; and

Whereas, many of the costs associated with water, wastewater, and stormwater improvements are due to regulatory demands by Federal and State agencies; and

Whereas, these regulatory demands on cities, towns and districts currently do not consider compliance costs or assess the value of the benefits derived; and

Whereas, it is in the public interest to spend ratepayer and taxpayer funds wisely, and to ensure the maximum benefits are derived for each dollar expended.

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:

Notwithstanding the provisions of section 27C of chapter 29 of the General Laws, or any other general or special law to the contrary, any proposal initiated by the Executive Office of Energy and Environmental Affairs and its subordinate agencies, commissions, or boards (collectively EOEEA) in the form of a rule, regulation or so-called guidance document or policy resulting in the imposition of additional cost to a city or town shall be termed a “local mandate”. Local mandates shall include but not be limited to any EOEEA initiated rule, regulation or so-called guidance document or policy that: (1.) requires any city or town to undertake any service or direct or indirect cost obligation, or to establish, expand or modify any existing activity in such a way that results in the expenditure of funds or resources, or results in the diversion of funds or resources from any existing activity. For the purposes of this section, the term “existing activity” shall include any program or service lawfully undertaken by any city or town under the authority of any law, special law, administrative rule or regulation or city or town charter, or; (2.) relieves the state or a county from providing a service or program so that any city or town instead incurs the direct or indirect cost of such service or program.

SECTION 2. No proposal initiated by the EOEEA in the form of a rule or regulation, or so-called guidance document or policy, which pertains to water, wastewater, and/or stormwater, shall become effective until a regulatory impact statement has been completed, made public during the hearing process described in chapter 30A of the General Laws and filed with the secretary of state. The regulatory impact statement shall: (a) identify the problem, issue or deficiency addressed by the proposal; (b) identify the methodology or approach, including identification of expert information and analysis used to address the problem, issue or deficiency; (c) identify stakeholders who will be affected and to what extent by the proposal; (d) identify when such proposal will become effective, when such proposal will be changed, if known, and how and when the proposal will be reviewed in the future, if at all; (e) identify and describe the immediate and long term financial impacts of the proposal on all stakeholders, including the entity issuing the proposal, any affected private party or entity, the state, the cities and towns, and the general public. Such financial impact statement shall consider administrative costs, permitting costs, enforcement costs, capital costs, internal compliance costs, and indirect costs, if any; (f) identify the fiscal effect on the public and private sectors for the first and second year of the proposal's existence, and provide a projection of fiscal impact over the first five years of the proposal's existence or, in the case of proposals affecting permits issued by the EOEEA, the term of the permit; and (g) identify and describe, specifically, the benefits of the proposal including, where possible, the financial value of these benefits. The secretary of administration and finance shall adopt regulations to further define and implement the use of regulatory impact statements by the EOEEA.

SECTION 3. The EOEEA shall maintain a list of stakeholders who have requested preliminary notification of proposals made by said executive office and subordinate agencies; such request may be renewed annually by persons or groups in December. No later than thirty days prior to the notice of hearing described above, the EOEEA shall send a preliminary notification of the proposal to each stakeholder on the list and to the Joint Legislative Committee on Natural Resources, the Joint Legislative Committee on Local Affairs, the House and Senate Committees on Ways & Means, the Office of the State Auditor and the Massachusetts Municipal Association. The preliminary notification of the proposal shall (a) identify the proposal to be noticed for hearing and the scope of the proposal, (b) provide the statutory authority for such proposal, and (c) identify the person within the EOEEA responsible for the proposal and who can be contacted for more information.

SECTION 4. No proposal initiated by the EOEEA in the form of a rule, regulation, or so called guidance document or policy, which pertains to water, wastewater, and/or stormwater, shall become effective until the EOEEA has complied with the provisions of Massachusetts Administrative Procedures Act established under the provisions of Chapter 30A of the General Laws. Any entity claiming to be aggrieved by lack of compliance with said chapter shall be permitted to file a petition for relief with the superior court.