Opinion Number

Dear Representative Holden:

We are in receipt of your expedited opinion request regarding emergency rules recently adopted by the Secretary of the Department of Environmental Quality. You state that the Secretary has adopted a series of emergency rules over the course of the last six months under the emergency rule-making provision of the Administrative Procedure Act, R.S. 49:953B, citing possible economic loss to certain companies as the reason for adopting these emergency rules. In a telephone conversation for the purpose of clarifying our understanding of the opinion request, you gave as a particular example the recent emergency rules adopted by the Department of Environmental Quality dealing with produced water discharges.1

Specifically, you ask whether economic loss is a sufficient basis for a declaration of emergency by the Department of Environmental Quality.

As this office has stated in previous opinions, emergency rules which are adopted without strict adherence to the emergency rule-making provisions of the Administrative Procedure Act are null and void and unenforceable. In our opinion, the emergency rules at issue here were improperly adopted by the Department of Environmental Quality and are therefore invalid for the reasons set forth in those opinions2 and discussed further below. *Page 2

The emergency rules were adopted under Section 953B of the Administrative Procedure Act, which provides a mechanism for circumventing the normal rule-making process when there is "an imminent peril to the public health, safety, or welfare. . .," R.S. 49:953B(1). To circumvent the normal rule-making process, with all of the protections and safeguards granted to the public, the agency must include a "statement of its reason for finding it necessary to adopt an emergency rule [which] shall includespecific reasons why the failure to adopt the rule on an emergency basis would result in imminent peril to the public health, safety or welfare. . .," R.S. 49:953B(1).

Rules and emergency rules are essentially legislation. The Administrative Procedure Act is a judicially approved exception to the general rule that prohibits delegation of authority from one branch of government to another. Because the legislature has in essence delegated some of its law-making authority to the executive, legislative oversight of rule-making — and in particular emergency rule-making — is especially important. As this office has stated on page 4 of Opinion No. 90-226A:

The public policy norm of the APA is the deliberate rule-making procedure of R.S. 49:953A with its features of notice, hearing and public participation. Emergency rule-making is the extraordinary exception to this norm. . . .

Opinion No. 90-226A further states:

[T]he general and fundamental requirements of the Administrative Procedure Act . . . are to give fair notice to the public and an opportunity to be heard at a fair hearing, public purposes inherently safeguarded in the legislative process but which must be mandated by law in the executive equivalent of rulemaking. Because the emergency rule-making process is extraordinary precisely because it dispenses with these fundamental safeguards of notice and hearing, the substantive grounds for its exercise are to be interpreted stricti juris. . . .

* * *

The procedure effected by the Administrative Procedure Act is intended to provide an executive facsimile of the type of notice and hearing and public participation traditionally observed in the lawmaking process of the legislative branch of government. The legal incorporation of these safeguards into the rulemaking process restrains arbitrary, capricious or abusive exercises of power by executive officers and agencies.

*Page 3

Notice to the public has been stated to be the core safeguard; a hearing facilitates notice, as well as an opportunity for public response. Dorignac v. Louisiana State Racing Commission, 436 So.2d 667 (La.App. 4th Cir. 1983).

Attorney General's Opinion No. 90-226A, July 2, 1990, pages 1-3 (emphasis added)

In its declaration of emergency supporting adoption of the emergency rules, the Department of Environmental Quality, Office of Water Resources has stated in relevant part:

[T]he Secretary of the Department hereby finds that imminent peril to the public welfare exists.

* * *

Under current Louisiana regulations, most discharges of produced water from oil and gas production facilities must cease before January 1, 1997. For certain of these facilities, compliance with the prohibition on produced water discharges would require stopping production or the disposal of all produced waters. Either alternative could affect the public welfare through the loss of employment, loss of taxes, and loss of royalty revenues.

The cost of disposal of produced water at permitted disposal facilities, along with the attendant costs of storage and transportation, could greatly reduce the net income generated by these production facilities. In many cases, the costs may be so great in relation to the revenue generated by the oil and/or gas production as to render continued operation impractical.

* * *

Declaration of Emergency, Department of Environmental Quality. Office of Water Resources WPO23E (emphasis added)

*Page 4

The notice requirements in the Department of Environmental Quality's declaration of emergency do not appear to meet the standards established by previous opinions issued by this office. Opinion No. 93-689, based on similar facts, states:

This language absent other clarification appears insufficient, and for this reason the emergency rule is facially defective.

* * *

An emergency rule rendered . . . without the inclusion of the facts justifying its issuance is invalid and unenforceable.

Attorney General's Opinion No. 93-689, November 10, 1993, page 3.

The requirements of the notice of intent are further set forth in detail in Opinion No. 90-226A:

The notice of intent to promulgate the emergency rule must justify its grounds. It must memorialize the grounds for the departure from the legislatively preferred procedure. Emergency rule-making is not an alternative to the procedure of R.S. 49.953A, it is an anomalous mode of executive action justified only by [the] two narrow sets of circumstances stated in R.S. 49.953B(1).

Hence, for an emergency rule to have legal effect, the notice must state facts which if presumed true would constitute prima facie proof of one of the two grounds for emergency procedure under R.S. 49:953[B]. A legal conclusion that there is an imminent peril to the public health, safety or welfare will not suffice; the notice must state facts which if presumed true would establish the nature and existence of such peril. This failure is the first problem with the emergency rule.

Attorney General's Opinion No. 90-226A, July 2, 1990, page 4 (emphasis added)

For the reasons set forth in the above opinions of this office, it is our opinion that the emergency rule is fatally defective because the declaration of emergency states no facts which constitute an emergency. In fact, the declaration of emergency states no facts at all, but merely states suppositions. The only basis advanced in support of the adoption of the emergency rule is couched in merely hypothetical terms: failure to adopt the rule *Page 5
"could affect the public welfare;" failure "could greatly reduce . . . net income;" and "costs may be so great . . . as to render continued production impractical." Such statements are suppositions only, not facts, and therefore cannot support adoption of an emergency rule. An emergency is not something thatmay happen or could happen; an emergency is something that is about to happen or has already happened.

It appears that the failure of the declaration is due at least in part to the failure of the agency to properly interpret the "imminent peril" provision of R.S. 49:953B(1). Again, we quote from Opinion No. 90-226A:

[T]he agency [failed] to properly interpret "imminent." The facts stated in the emergency notice must reflect that one or both of the two harms which justify emergency rulemaking under R.S. 49:93B(1) will occur before regular rulemaking by normal procedure can result in an amelioration of the crisis. If there is no risk of federal sanctions being imposed before regular permanent rulemaking can be completed, with its full notice, hearing and public response facets, there is no legal cause for an emergency rule. The emergency rule is intended only to prevent one or both harms, peril to health, etc. or sanctions, from occurring before a regular rule can be adopted.

An emergency rule is not a routine procedure for an executive agency to adopt to "fill the gap" until a regular rule is adopted. There must be an emergency. . . .

Attorney General's Opinion No. 90-226A, July 2, 1990, page 4 (emphasis in original)

Having given our opinion that the declaration of emergency is defective for failure to state facts which constitute an emergency, we wish to suggest an additional reason why the emergency rules require strict scrutiny. When an emergency environmental rule, as it does here, actually reduces
environmental protection, strict scrutiny and legislative oversight become particularly important. This is especially so considering the high standard of environmental protection placed on the Secretary of the Department of Environmental Quality by the constitution and statutes of the state of Louisiana. ArticleIX, Section 1 of the 1974 Louisiana Constitution states: *Page 6

§ 1. Natural Resources and Environment; Public Policy

Section 1. The natural resources of the state, including air and water, and the healthful, scenic, historic, and esthetic quality of the environment shall be protected, conserved, and replenished insofar as possible and consistent with the health, safety, and welfare of the people. The legislature shall enact laws to implement this policy.

1974 La. Const., Art. IX, Sec. I (emphasis added)

It should be noted that water is specifically listed as a natural resource which must be protected.

The natural resources article has been interpreted by the Louisiana Supreme Court in a landmark case, Save Ourselves,Inc., et al. v. The Louisiana Environmental Control Commission,452 So.2d 1152 (La. 1984), as establishing a public trust for the protection of the environment:

it is well settled law of this country that a state holds title to land under navigable waters within its limits and that the title is held in trust for the people of the state that they may enjoy and use the waters free from obstruction or interference. A public trust for the protection, conservation and replenishment of all natural resources of the stale was recognized by art. VI, § 1 of the 1921 Louisiana Constitution. The public trust doctrine was continued by the 1974 Louisiana Constitution, which specifically lists air and water as natural resources,
commands protection, conservation and replenishment of them insofar as possible and consistent with health, safety and welfare of the people, and mandates the legislature to enact laws to implement this policy.

* * *

[T]he Natural Resources article of the 1974 Louisiana Constitution imposes a duty of environmental protection on all state agencies and officials, established a standard of environmental protection, and mandates the legislature to enact laws to implement fully this policy.

Save Ourselves, Inc., et al v. Louisiana Environmental ControlCommission, 452 So.2d 1152 at 1154, 1156 (emphasis added, citations and footnotes omitted) *Page 7

In furtherance of this constitutional mandate, the legislature in 1979 enacted the Environmental Affairs Act, now known as the Louisiana Environmental Quality Act, R.S. 30:2001,et seq. In so doing, the legislature made certain findings and declarations with respect to the environment:

§ 2002. Findings and declaration of policy

The legislature finds and declares that:

(1) The maintenance of a healthful and safe environment for the people of Louisiana is a matter of critical state concern.

(2) It is necessary and desirable for the protection of the public welfare and property of the people of Louisiana that there be maintained at all times, both now and in the future, clean air and water resources preservation of the scenic beauty and ecological regimen of certain free flowing streams, and strictly enforced programs for the safe and sanitary disposal of solid waste, for the management of hazardous waste, for the control of hazards due to natural and man-made radiation, considering sound policies regarding employment and economic development in Louisiana.

R.S. 30:2002 (emphasis added)

Again, it should be noted that the statute specifically requires the maintenance of clean air and water resources.

Included in the 1979 enactment of the Environmental Affairs Act, and maintained in the Environmental Quality Act, is the Louisiana Water Control Law, R.S. 30:2071 et seq. In Section 2072, the legislature set forth further findings and declarations with regard to water resources:

§ 2072. Policy; purpose

The legislature finds and declares that the waters of the state of Louisiana are among the state's most important natural resource and their continued protection and safeguard is of vital concern to the citizens of this state. To insure the proper protection and maintenance of the state's waters, it is necessary to adopt a system to control and regulate the discharge of waste materials, pollutants, and other substances into the waters of the state.

R.S. 30:2072 (emphasis added) *Page 8

In addition, the legislature has made the Secretary of the Department of Environmental Quality the primary public trustee of the environment,3 and the Louisiana Supreme Court has stated that the Secretary must act affirmatively to protect the environment:

The constitutional-statutory scheme implies several other important principles. Since the [Secretary], in effect, has been designated to act as the primary public trustee of the natural resources and the environment in protecting them from hazardous waste pollution, it necessarily follows that the agency must act with diligence, fairness and faithfulness to protect this public interest in the resource. Consequently, the [Secretary's] role as the representative of the public interest does not permit [him] to act as an umpire passively calling balls and strikes for adversaries appearing before it; the rights of the public must receive active and affirmative protection at the hands of the [Secretary].

Save Ourselves, Inc., 452 So.2d at 1157 (emphasis added, citations omitted)

Thus we see that the people of the state, through their constitution, have established a public policy for the protection of the state's natural resources and environment, including water; that the supreme court has ruled that the natural resources article establishes a public trust for the protection of the environment and a duty of environmental protection on all state agencies and officials; and that the legislature, in furtherance of their mandate, has found that the maintenance of a healthful and safe environment is a matter of "critical state concern," that protecting and safeguarding the waters of the state is "of vital concern" to the citizens of the state; and that the legislature has made the Secretary of the Department of Environmental Quality the primary public trustee of the environment.

Given the high standard of environmental protection placed on the Secretary by the constitution, the legislature and the supreme court, and given that the emergency rules actuallyreduce environmental protection, we believe that strict adherence to the emergency rule-making provisions of the Administrative Procedure Act is especially important. For this reason, and for the reasons set out above, we believe the emergency rules adopted by the Department of Environmental Quality were adopted improperly, and are thus invalid. *Page 9

Trusting that we have satisfactorily answered your inquiry, I am

Sincerely,

RICHARD P. IEYOUB Attorney General

By: IAN DOUGLAS LINDSEY
Assistant Attorney General

RPI/IDL:llh Enclosures

1 There are actually two emergency rules before us. Both grant an extension of time to achieve compliance with the prohibition against produced water discharges in fresh water areas and in intermediate, brackish and saline water areas inland of the territorial seas. The first emergency rule, WPO23E, was adopted December 30, 1996. The second emergency rule, WPO23E-A, adopted January 6, 1997, addresses an inadvertent omission in the first rule that resulted in a failure to provide an extension for discharges of produced water generated in territorial seas. A copy of both declarations of emergency is attached.

2 Opinion Nos. 90-226, 90-226A and 93-689, copies attached.

3 See R.S. 30:2014, 6th sentence: "The Secretary shall act as the primary public trustee of the environment. . . ."

DECLARATION OF EMERGENCY Department of Environmental Quality Office of Water Resources Extension of Time to Achieve Compliance with Prohibition Against Produced Water Discharges In Freshwater Areas and in Intermediate, Brackish, and Saline Water Areas Inland of the Territorial Seas (LAC 33:IX.708.C) WPO23E
In accordance with the emergency provisions of La. R. S.49:953(B) of the Administrative Procedure Act; which allow the Department of Environmental Quality (Department) to use emergency procedures to establish rules, and of La. R. S. 30:2011 and La. R. S. 30:2074, which allow the Department to establish standards, guidelines, and criteria, to promulgate rules and regulations, and to issue compliance schedules, the Secretary of the Department hereby finds that imminent peril to the public welfare exists. Accordingly, the Department adopts the following emergency rule effective December 30, 1996, for one hundred twenty (120) days, or until promulgation of the final rule, whichever occurs first.

Under current Louisiana regulations, most discharges of produced water from oil and gas production facilities must cease before January 1, 1997. For certain of these facilities, compliance with the prohibition on produced water discharges would require stopping production or the disposal of all produced waters. Either alternative could affect the public welfare through loss of employment, loss of taxes, and loss of royalty revenues.

The cost of disposal of produced water at permitted disposal facilities, along with the attendant costs of storage and transportation, could greatly reduce the net income generated by these production facilities. In many cases, the costs may be so great in relation to the revenue generated by the oil and/or gas production as to render continued operation impractical.

As a further basis for promulgation of this emergency rule, the Department finds the following:

State regulation of produced water

Many LWDPS permits have prohibited discharges of produced water beginning in 1988.

In March of 1991, state regulations were promulgated concerning produced water.

*Page 2

Certain facilities have been granted authority to discharge produced water for limited periods of time while working to eliminate all produced water discharges.

Federal regulation of produced water

Federal general permit

NPDES general permit LAG290000 (published in the Federal Register on January 9, 1995, and effective February 8, 1995) prohibits produced water discharges to coastal waters with some exceptions.

Federal administrative order

In conjunction with NPDES general permit LAG290000, the EPA issued an administrative order (also effective February 8, 1995) extending the time for compliance with the prohibition until January 1, 1997.

Federal guidelines and standards

The most recently promulgated federal guidelines and standards that address produced water discharges were published December 16, 1996, at 61 Fed. Reg. 66085 (1996) (the federal guidelines).

The federal guidelines note at page 66122-23 the following:

EPA received numerous comments from operators in the Gulf of Mexico coastal region claiming that they would need additional time to comply with the rule's zero discharge requirement for produced water. EPA recognizes that it may take some time for operators to determine the best and most cost effective mechanism of compliance and to implement that mechanism. EPA also recognizes that the NPDES permit issuing authority has discretion to use administrative orders to provide the requisite additional time to meet zero discharge.

The Department's Office of Water Resources became the NPDES permit issuing authority for the State of Louisiana on August 27, 1996.

*Page 3

The federal guidelines also note at page 66087 the following:

The United States Department of Energy (DOE) has provided the State of Louisiana with comments end analyses suggesting a change to the Louisiana state law requiring zero discharge of produced waters to open bays by January 1997. Promulgation of [these 12/16/96 federal guidelines] would generally preclude issuance of permits allowing discharges.

Department of Energy study

The Department accepted information that was part of the DOE study referenced in LAC 33:IX.708.C.2.b.iv.(e), as documented at 61 Fed. Reg 66087.

Even though the DOE study itself has not yet been completed, the Department and the EPA agree that study results would not change the produced water zero discharge requirement because the study's data and argument address water quality based limits and the federal guidelines are technology based.

Mitigating factors

Various facilities have been unable to comply with the requirement to cease all discharges of produced water by January 1, 1997, because:

1. A number of facilities have applied to the Louisiana Department of Natural Resources (DNR) for permits to construct injection wells to receive the produced water that would otherwise be discharged. Due to a personnel shortage at DNR, all of the permit applications currently pending will not be processed prior to January of 1997.

2. Facilities that discharge under the authority of LAC 33:IX.708.2.a.iv possess a valid LWDPS permit which allows continued discharge of produced water. With the publication of the federal guidelines on December 16, 1996, and upon the effective date of those guidelines (January 14, 1997), these dischargers will still possess a valid state *Page 4
permit which conflicts with promulgated federal guidelines requiring zero discharge.

3. Certain facilities that previously had authority to discharge produced water relied upon the DOE study to support an individual or general permit or a rule change to allow the discharge of produced water. These facilities are now, with promulgation of the 1996 federal guidelines required to attain zero discharge.

Conclusion

The loss of employment, taxes, and royalties that would otherwise result, to the detriment of the public welfare, can be avoided by allowing, on a case-by-case basis, a limited amount of additional time for certain operators to either arrange an alternate method for disposal of their produced water or to cease production. This extension of time shall not extend the produced water discharge beyond January 1, 1999, except that an additional one-year extension may be granted to those facilities that discharge produced water generated in outer continental shelf waters into a major deltaic pass of the Mississippi River or to the Atchafalaya River, including Wax Lake Outlet below Morgan City. In no instance shall the Department approve a produced water discharge which would extend beyond January 1, 2000.

Adopted this 30th day of December, 1996.

J. Dale Givens
Secretary

This public document was published at a total cost of $290.64.1255 copies of this public document were published at a total cost of $290.64. The total cost of all printings of this document, including reprints, is $290.64. The document was published by the Louisiana Department of Environmental Quality, P.O. Box 82282, Baton Rouge, LA 70884, for the purpose of informing the public of environmentally significant actions taken by the Secretary in accordance with the Administrative Procedure Act, R.S. 49:950-971 and/or R.S. 30:2001 et seq. This material was printed in accordance with the standards for printing by state agencies established pursuant to R.S. 43.31.

DECLARATION OF EMERGENCY Department of Environmental Quality Office of Water Resources Extension of Time to Achieve Compliance with Prohibition Against Produced Water Discharges in Freshwater Areas and in Intermediate, Brackish, and Saline Water Areas Inland of the Territorial Seas (LAC 33:IX.708.C) WPO23E-A
In accordance with the emergency provisions of La. R. S.49:953 (B) of the Administrative Procedure Act, which allow the Department of Environmental Quality (Department) to use emergency procedures to establish rules, and of La. R. S. 30:2011 and La. R. S. 30:2074, which allow the Department to establish standards, guidelines and criteria, to promulgate rules and regulations, and to issue compliance schedules, the Secretary of the Department hereby finds that imminent peril to the public welfare exists and accordingly adopts the following emergency rule effective January 6, 1997 for one hundred twenty (120) days, or until promulgation of the final rule, whichever occurs first.

On December 30, 1996, the Department of Environmental Quality adopted an emergency rule, WPO23E, which provided extensions of time to achieve compliance with prohibition against produced water discharges. An inadvertent omission in that rule resulted in a failure to provide an extension for discharges of produced water generated in territorial seas. The purpose of this emergency rule is to correct and supplement the original emergency rule to address the omitted category of produced water and other typographical errors.

All findings and specific reasons for issuance of this emergency rule are as stated in the WPO23E Declaration of Emergency and are incorporated herein.

Adopted this 6th day of January, 1997.

J. Dale Givens
Secretary

OPINION NUMBER 90-226

May 25, 1990

64-2 — LOUISIANA ADMINISTRATIVE PROCEDURE ACT LSA-R.S. 29:953A.B LSA-R.S. 46:931 et seq.

Promulgation of emergency rule Honorable Donald Ray Kennard by Governor's Office of Elderly Louisiana State Representative Affairs did not conform to 11155 Sullivan Road procedural requirements of Baton Rouge, LA 70818 Administrative Procedure Act.

Dear Representative Kennard:

You have, on behalf of the East Baton Rouge Council on Aging, requested an opinion on the lawfulness of an Emergency Rule regulating services procurement by parish councils on aging, which was adopted by the Governor's Office of Elderly Affairs (GOEA) on March 12, 1990. The rule will become effective as a permanent rule on June 20, 1990.

Your opinion request excites a perennial issue in Louisiana government law — the conflict between state and local power. The substantive question presented is the nature and scope of GOEA's rule-making powers over the administration by the parish councils on aging of the state and federal programs for the benefit of the elderly population of Louisiana. The procedural issue is whether GOEA has followed the required procedure of both the Administrative Procedure Act (LSA-R.S. 49:953) and its own enabling statute (LSA-R.S 46:931) for the emergency rule and proposed rule change.

The substantive question is not reached for two reasons. First is that the procedural question yields a decisive answer on its own merits. Secondly, litigation over the interpretation of the old GOEA rule now being superceded by the new rule of June 20, 1990 is pending in district court, with GOEA being represented by the Department of Justice. Although you are not a party to that suit, and this writer is not involved in it as counsel to GOEA, it would be improper for this opinion to consider any issue of law included therein, and further, such consideration of the substantive issue possibly also implied in that litigation (involving rule-interpretation) would violate the internal policy of the Department of Justice to not render opinions on matters in litigation before courts of law. This opinion is restricted to the validity of the new rule announced March 9, 1990 by GOEA. *Page 2

The March 12, 1990 Emergency Rule promulgated by GOEA, according to the notice of intent, was adopted for the following reasons: "The Emergency Rule was adopted to avoid federal sanctions." There was no further statement as to when federal sanctions had been threatened or were expected, and whether normal rule-making procedures would have obviated the imposition of sanctions as well.

LSA-R.S. 49:953B(1) states the two exclusive grounds for the issuance of an emergency rule in contravention of the procedural requirements for rule making in R.S. 49:953A(1). Section 953B(1) provides, in pertinent part:

"if an agency finds that an imminent peril to the public health, safety or welfare requires adoption of a rule . . . it may proceed without prior notice and hearing that it finds practicable, to adopt an emergency rule. The provisions of this Paragraph also shall apply to the extent necessary to avoid sanctions or penalties from the United States." (Emphasis added.)

Both the "peril" and "sanctions" exceptions for emergency rule making imply a necessity involving the public interest which obviates the need for the preferred procedural process of R.S.49:953A. The "sanctions" exception expresses this clearly by the words "to the extent necessary."

The Attorney General interprets this section to mean that federal sanctions or penalties must be "imminent." In other words, such federal sanctions will be imposed before the normal procedure for rule making can be perfected. This emergency rule authority is intended to prevent the imposition of federal sanctions pending the formal process for adoption and promulgation of a rule. Stated in shorthand, if no federal sanctions were threatened or reasonably foreseen to be imposed before the regular June 20, 1990 effective date of the rule change for services procurement, the Emergency Rule is invalid by reason of this substantive infirmity. If it doesn't meet the narrow exceptions to Sec. 953A stated in Sec. 953B(1), then a proposed rule is invalid because the agency is not substantively authorized by Sec. 953B(1) to waive the procedural norm of Sec. 953A. *Page 3

The notice requirement for an emergency rule is less substantive and burdensome than for the permanent rule making process; R.S. 49:9535 (1) allows any "abbreviated notice" which is practicable." This provision refers to the requirements of R.S. 49:953A(1) rather than the special grounds required to use the emergency procedure of R.S. 49:9535 (1). In other words, where valid grounds for invoking the emergency authority are present, the content of the notice and procedure for hearing on the emergency rule may be waived as necessary by the agency. However, the notice for an emergency rule must state facts whichconstitute grounds under one of the two standards stated by R.S.49:953B(1) to authorize the invocation of the emergency procedure. Before the emergency rule may be promulgated, the public must be noticed of facts which constitute an imminent
(1) peril to the public health, safety or welfare or (2) imposition of federal sanctions or penalties. The agency cannot simply state a conclusion, but must state the facts which justify the conclusion that either an imminent peril exists or the imminent imposition of federal sanctions will occur. "Imminent" means before the adoption of a permanent rule by normal rule making procedure.

Secondly, both the Emergency Rule and the permanent rule change may suffer another procedural infirmity in their facial non-compliance with the mandate of LSA-R.S. 46:935, which requires the director of the GOEA to receive the advice and consent of the Louisiana Aging Advisory Board (cf. 46:933) "on all rules and regulations promulgated by (GOEA) which pertain to elderly affairs." While a declaration that proposed rules and rule changes were submitted to this Advisory Board is not required in the notice of intent, failure to conform with R.S.46:934, which is mandatory, may invalidate either the Emergency Rule or permanent rule, or both.

Finally, while this writer does not have the published notice of intent of the Louisiana Register, the typed notice issued by GOEA does not facially reflect the inclusion of either the fiscal impact statement or the economic impact statement required by law which had been approved by the Legislative Fiscal Office. R.S. 49:953 requires these statements in the notice of the intent of the promulgating agency. R.S. 49:954 prohibits the enforcement of the rule without publication of the fiscal and economic statements in the Louisiana Register. If these legislative fiscal statements were published in the Register, while that statutory defect would be cured, the other defect in the notice of intent resulting from its non-conformity with R.S.49:953A(1)(a)(ii) and (iii) would subsist. Even rules which implement or change *Page 4
procedure are subject to these requirements for a fiscal and economic impact statement from the legislative fiscal office. Opinion of the Attorney General No. 87-752.

In conclusion, there appear to be substantial procedural infirmities in this particular instance of rule making by the Governor's Office of Elderly Affaris. Some of these insufficiencies are curable; some appear not to be.

Trusting this to be of sufficient information, I am

Sincerely,

WILLIAM J. GUSTE, JR. Attorney General

BY: CHARLES J. YEAGER
Assistant Attorney General

CJY:tm

OPINION NUMBER 90-226A

July 2, 1990

64-2 — LOUISIANA ADMINISTRATIVE PROCEDURE LSA-R.S. 49:953

Ms. Vicky Hunt, Director Notice for Emergency Rule must Governor's Office of Elderly state facts which when presumed Affairs true establish one of two P.O. Box 80374 grounds for issuance of an Baton Rouge, LA 70898-0374 emergency rule.

Dear Representative Roach:

This office is in receipt of your request for an opinion directed to Attorney General Richard P. Ieyoub. The request has been assigned to me for resolution.

You state that the Office of Alcoholic Beverage Control adopted an emergency rule on September 24, 1993 which regulates live entertainment on certain licensed premises. You further relate that the effect of this rule is to "allow topless dancing with bare breasts and (further) removes the distance limitations between the dancer and patrons". You ask (1) whether the substance of the emergency rule is in violation of existing state law, and (2) whether the emergency rule is defective for its failure to be properly promulgated in accordance with law.

LSA-R.S. 26:286 allows live entertainment on licensed premises, but prohibits the "displaying . . . [of the] nipple of the female breast", and further restricts the performance of the dancer to a level "at least eighteen inches above the immediate floor. . . . [and] at least three feet from the nearest patron". LSA-R.S. 26:286 (D) (3) and (E). While the statute is in conflict with the substance of the emergency rule as you relate, note the legislature has recently empowered the commissioner to establish rules authorizing types of entertainment on licensed premises. LSA-R.S. 26:793 (A) provides, in pertinent part:

Notwithstanding the provisions of R.S. 26:90 (B), (C), (D), (E), (F), and (G) and R.S. 26:286 (B), (C), (D), (E), (F), and (G) to the contrary, the commissioner may establish rules *Page 2
and regulations adopted pursuant to the Administrative Procedure Act authorizing the types of entertainment and employment allowed on a licensed premises.

LSA-R.S. 26:793 (A) was amended by Act 447 of the 1991 Regular Legislative Session, and resulted in the above quoted portion. LSA-R.S. 26:793 (A) as quoted above is controlling as the latest expression of the legislative will. Accordingly, the commissioner may establish a rule redefining the types of entertainment allowable in licensed premises, despite the prohibitory language of those cited portions of LSA-R.S. 26:90
and LSA-R.S. 26:286. In response to your first inquiry, the substance of the emergency rule appears to be in conformity with state law.

This author has not been provided a copy of the emergency rule; however, our answer to your second inquiry is in the affirmative, based upon the facts as related in your letter. Under the Administrative Procedure Act, an emergency rule which dispenses with the regular requirements of notice and hearing may be invoked only in limited circumstances. LSA-R.S. 49:953 (B) (1) provides, in part:

If an agency finds that an imminent peril to the public health, safety, or welfare requires adoption of a rule upon shorter notice than that provided in R.S. 49:953 (A) and within five days of adoption states in writing . . . its reasons for that finding, it may proceed without prior notice or hearing or upon any abbreviated notice and hearing that it finds practicable, to adopt an emergency rule. The provisions of this Paragraph also shall apply to the extent necessary to avoid [federal] sanctions (Emphasis added).

You state the notice of intent to promulgate the emergency rule provides the following as the basis for issuance:

The Commissioner further finds that in order to implement the appropriate rules and regulations to comply with R.S. 26:793, it is necessary to do so on an emergency basis so as to maintain the ongoing continuity in the ability of the Office of Alcoholic Beverage Control to enforce the law as regulated in a type of entertainment allowed on licensed premises on a statewide basis.

*Page 3

This language absent other clarification appears insufficient, and for this reason the emergency rule is facially defective. Our conclusion is supported by previous opinions issued from this office interpreting the validity of emergency rules. In Attorney General Opinion 90-226 (A), the author concluded:

The notice of intent to promulgate the emergency rule must justify its grounds. It must memorialize the grounds for the departure from the legislatively preferred procedure. . . . Hence, for an emergency rule to have legal effect, the notice must state facts which if presumed true would constitute prima facie proof of one of the two grounds for emergency procedure under R.S. 49:953 (A). A legal conclusion that there is an imminent peril to public health, safety and welfare will not suffice; the notice must state facts which if presumed true would establish the nature and existence of such peril. . . . There must be an emergency, which must be factually described in the notice. . . . an emergency rule has no legal validity unless it states facts which constitutes grounds under the statute. See also attached Attorney General Opinion 90-226; (Emphasis added).

The facts which serve as the basis for the promulgation of the emergency rule are presumed to be correct, but the facts which suggest imminent peril to the public safety or prompt federal sanctions must be stated in the notice of intent. An emergency rule rendered by the commissioner without the inclusion of the facts justifying its issuance is invalid and unenforceable.

Very truly yours,

RICHARD P. IEYOUB Attorney General

By: Kerry L. Kilpatrick
Assistant Attorney General RPI/KLK/Roach

Dear Ms. Morvant:

You have requested an Attorney General's Opinion on the authority of the Board of Nursing to adopt an emergency rule establishing a new fee schedule.

Attached, please find Attorney General Opinion Number 97-32 which gives a thorough review of the authority and procedure for promulgating emergency rules pursuant to the Administrative Procedure Act. More specifically, this Opinion addresses what may and may not serve as a proper basis for this procedure.

Please contact us if you require further assistance.

Very truly yours,

RICHARD P. IEYOUB ATTORNEY GENERAL

BY: CARLOS M. FINALET, III
ASSISTANT ATTORNEY GENERAL

RPI/CMF:mjb Attachment

OPINION NUMBER 97-32

February 18, 1997

64-2 LOUISIANA ADMINISTRATIVE PROCEDURE ACT R.S. 30:2001 et seq.: R.S. 30:2002; R.S. 30:2071; R.S. 30:2072; LSA-R.S. 49:953; 1974 La. Const. Art. IX, Sec. I
Representative Melvin "Kip" Holden State of Louisiana Promulgation of emergency rule House of Representatives by the Department of 2013 Central Road Environmental Quality did not Baton Rouge, LA 70807 conform to procedural requirement of Administrative Procedure Act.

Dear Ms. Hunt:

You have requested a supplementary opinion in this matter to reconsider several presumptions of fact in the original opinion as well as two interpretations of law contained therein. Your basic concern is whether the emergency rule and the contracts let thereunder are valid, and whether the permanent rule, intended to be effective on or about June 20, 1990, is lawfully adopted.

NOTICE OF INTENT
The procedure for an emergency rule is stated by R.S.49:953B(1). This procedure when properly invoked upon one of the two (2) substantive grounds stated by that subsection is exempted from the general and fundamental requirements of the Administrative Procedure Act. These are to give fair notice to the public and an opportunity to be heard at a fair hearing, public purposes inherently safeguarded in the legislative process but which must be mandated by law in the executive equivalent of rulemaking. Because the emergency rulemaking process is extraordinary precisely because it dispenses with these fundamental safeguards of notice and hearing, the substantive grounds for its exercise are to be interpreted stricti juris,
and the factual basis for the grounds are the burden of the agency promulgating the emergency rule, and are not presumed from a simple statement or conclusion by the agency that the grounds for an emergency rule are present.

However when these grounds are present, and are properly noticed, R.S. 49:953B (1) grants discretion to the rulemaker to file such abbreviated notice as is deemed proper concurrently with the promulgation of the emergency rule. The rulemaker therefore does not have to conform with the several requirements of P.S. 49:953A for a valid emergency rule to *Page 2
issue; the notice required is governed by R.S. 49:953 (B)(1). Whatever inconsistency exists between the notice of intent issued by your office and R.S. 49:953A with regard to the permanent rule is irrelevant to the validity of the emergency rule, which is judged by different standards.

The original opinion stated that the typed notice of intent, provided with the opinion request, for the proposed rule by GOEA on service procurement did not include the fiscal impact statement or the economic impact statement required by R.S.49:953A(1)(a)(ii) and (iii). This statute does not require simply that such statements be "issued and made publicly accessible, nor authorize them to be stapled or clipped to the notice of intent. It mandates ("The notice shall include") that the fiscal and economic impact statements be included in the text of the notice of intent. The only means of determine whether notice of these impact statements was given simultaneously with the notice of intent to promulgate the rule is if the impact statements are actually incorporated within the formal notice of intent. That is the reason that R.S. 49:953A requires their incorporation into the notice of intent. Anyone reading a Section 953A notice of intent is entitled to infer that no impact statements as required by law were in fact obtained if they are not reproduced in the notice of intent. That is precisely what this writer concluded after reading the notice of intent for GOEA's proposed rule, and being unable to locate a Louisiana Register effecting the publication of same. The notice of intent is intended to be a self-contained document, containing all necessary information mandated by the statute to constitute the requisite legal notice.

Although fiscal and economic impact statements were in fact obtained by GOEA, they were not included in the notice of intent for the promulgation of the proposed rule on service procurement. This violation of R.S. 49:953A, which is a mandatory rather than permissive rule of law for agency rulemaking, results in a procedural defect in the adoption of this proposed rule by GOEA.

The legal effect of the violation of the statute must be evaluated in the context of the statutory purpose. The procedure effected by the Administrative Procedure Act is intended to provide an executive facsimile of the type of notice and hearing and public participation traditionally observed in the lawmaking process of the legislative branch of government. The legal incorporation of these safeguards into the rulemaking process restrains arbitrary, capricious or abusive exercises of power by executive officers and agencies. *Page 3

Notice to the public has been stated to be the core safeguard; a hearing facilitates notice, as well as an opportunity for public response. Dorignac v, Louisiana StateRacing Commission, 436 So.2d 667 (La.App. 4th Cir. 1983).

Although GOEA deviated from the correct procedure, it did obtain the required fiscal and economic impact statements, and did distribute those impact statements with the notice of intent. The combined impact statements were published in the Louisiana Register adjacent to the notice of intent, and clearly identified with it. The public notice contemplated by the APA, although presented in a procedurally defective way, does appear to have been substantially effected.

Further, although GOEA's compliance with the statute was imperfect in two particulars, the record indicates that it acted in good faith in attempting to comply with the law. What mistakes were made in promulgating the permanent rule were not a subterfuge to subvert the intent of the law to afford notice and hearing to the public. A notice of intent was filed. impact statements were prepared and obtained, and a hearing was held. The procedural error in the preparation of the notice of intent is de minimus non curat lex, and does not invalidate the permanent rule on service procurement.

The rule on service procurement effective June 20, 1990 was lawfully adopted.

VALIDITY OF EMERGENCY RULE
There is no justifying context to excuse the emergency rule as de minimus.

Just as the conclusion of the original opinion, that the law requires the fiscal and economic impact statements to be incorporated into the R.S. 49:953A notice of intent, has been reaffirmed, the conclusion that the emergency rule was improvidently promulgated due to its noncompliance with the provisions of R.S. 49:953B(1) is likewise reaffirmed. The nature of the error in the emergency rulemaking, however, invalidates the emergency rule as null and void ab initio.

While R.S. 49:953B(1) dispenses the executive entity from promulgating a notice of intent with the required content for the permanent rule, it also has special requirements of its own. It requires that the extraordinary procedure of emergency rulemaking can only be undertaken on one of two grounds: (I) an imminent
peril to the public health, safety or welfare or (2) theimminent imposition of federal sanctions or penalties. *Page 4

The public policy norm of the APA is the deliberate rulemaking procedure of R.S. 49:953A, with its features of notice, hearing and public participation. Emergency rulemaking is the extraordinary exception to this norm, in that the executive agency unilaterally dispenses with the same legal requirements and safeguards for administrative rulemaking.

The notice of intent to promulgate the emergency rule must justify its grounds. It must memorialize the grounds for the departure from the legislatively preferred procedure. Emergency rulemaking is not an alternative to the procedure of R.S 49:953A; it is an anomalous mode of executive action justified only by two narrow sets of circumstances stated in R.S. 49:953B(1).

Hence, for an emergency rule to have legal effect, the notice must state facts which if presumed true would constitute prima facie proof of one of the two grounds for emergency procedure under R.S. 49:953A. A legal conclusion that there is an imminent peril to public health, safety and welfare will not suffice; the notice must state facts which if presumed true would establish the nature and existence of such peril. This failure is the first problem with the emergency rule.

The second is the failure of GOEA to properly interpret imminent. The facts stated in the emergency notice must reflect that one or both of the two harms which justify emergency rulemaking under R.S. 49:953B(1) will occur before regular rulemaking by normal procedure can result in an amelioration of the crisis. If there is no risk of federal sanctions being imposed before regular permanent rulemaking can be completed, with its full notice, hearing and public response facets, there is no legal cause for an emergency rule. The emergency rule is intended only to prevent one or both harms, peril to health, etc. or sanctions, from occurring before a regular rule can be adopted.

An emergency rule is not a routine procedure for an executive agency to adopt to "fill the gap" until a regular rule is adopted. There must be an emergency, which must be factually described in the notice and must conform to the two types of legal emergencies for which R.S. 49:953B(1) exclusively authorizes emergency rulemaking. For this reason an emergency rule has no legal validity unless it states facts which constitutes grounds under the statute. These facts are presumed true (prima facie) but through their inclusion in the notice the emergency rule must be self-justifying. *Page 5

This conclusion does not restrict GOEA's ability to avoid federal sanctions. Rather, it simply calls GOEA to obey the law.

LOUISIANA AGING ADVISORY BOARD
You are correct that the original opinion inadvertently used a legal term of art, advice and consent, to describe the role of the Louisiana Aging Advisory Board viz-a-viz the issuance of rules by the GOEA. The Board has an advisory role only. The material you have furnished reflecting that the Board was noticed of the rule change and invited to the public hearing to offer its advice and response substantiates that LSA-R.S. 46:934 was complied with in the administrative procedure by GOEA.

CONTRACTS
Without knowing the particulars of each contract issued under the emergency rule, an opinion as to whether their legal validity has been compromised by the invalidity of the emergency rule itself is inapposite.

One may reflect, however, that such contracts, if adversely affected by the invalidity of the emergency rule, may suffer only a relative nullity of consent which may be readily cured by ratification of one or both of the parties to your contract.

GOEA's regular counsel has been afforded an opportunity, as is the regular practice with opinions in the Department of Justice, to review and criticize both the original and this supplementary opinion before they were issued. He is the appropriate person to direct questions to regarding the validity of contracts.

Trusting this to be of sufficient information, I am

Sincerely,

WILLIAM J. GUSTE, JR. Attorney General

BY: CHARLES J. YEAGER
Assistant Attorney General

CJY:tm

OPINION NUMBER 93-689

November 10, 1993

64-2 LA ADMINISTRATIVE PROCEDURE ACT R.S. 49:953; R.S. 26:793(A)

The notice of intent for the adoption of emergency rule under the Administrative Procudures Representative Randall E. Roach Act must state facts which when District 36 presumed true establish grounds P.O. Box 4983 for the issuance of an emergency Lake Charles, LA 70606 rule.