1. Intent. The legislature hereby finds, determines and declares that:

1. (a) The capacity of public and private sector interests in rural areas to respond to state agency regulations is often constrained by an operating environment distinctly different from that found in suburban and metropolitan areas of the state;
2. (b) Factors such as population sparsity, small community size, limited access to financial and technical assistance, undeveloped services delivery systems, lack of economies of scale and extensive reliance on part-time and volunteer services providers inhibits rural ability to effectively address increasingly complex and stringent regulatory requirements;
3. (c) In order to maximize sensitivity to rural strengths and limitations, the state must continue to promote a framework which enhances state and local cooperation in meeting rural needs; and
4. (d) Enhancement of this chapter to include a more thorough assessment of regulatory impact and alternatives for rural areas can provide an improved dialogue on critical issues, while fostering a more cohesive and effective state/local partnership.

(b) In developing a rule, the agency shall consider utilizing approaches that will accomplish the objectives of applicable statutes while minimizing any adverse impact of the rule on public and private sector interests in rural areas. Consistent with the objectives of applicable statutes, the agency shall consider such approaches as:

1. (i) the establishment of differing compliance or reporting requirements or timetables that take into account the resources available to rural areas;
2. (ii) increased use of performance or outcome standards rather than design or input standards; and
3. (iii) an exemption from coverage by the rule, or by any part thereof, so long as the public health, safety or general welfare is not endangered.

4. 3. In proposing a rule for adoption or in adopting a rule on an emergency basis, the agency shall issue a rural area flexibility analysis regarding the rule being proposed for adoption or the emergency rule being adopted. A copy of such analysis and any finding, and reasons for such finding, pursuant to this section, shall be submitted in writing, and may be transmitted electronically in accordance with article three of the state technology law, to the governor, the temporary president of the senate, the speaker of the assembly, the office for regulatory and management assistance and the administrative regulations review commission at the time such analysis is submitted or electronically transmitted to the secretary of state for publication and, upon written or electronic request, a copy shall be sent or electronically transmitted to any other person. Each rural area flexibility analysis shall contain:

   1. (a) A description of the types and an estimate of the number of rural areas to which the rule will apply;
   2. (b) A description of (i) the reporting, recordkeeping and other compliance requirements of the rule, and (ii) the kinds of professional services that are likely to be needed in a rural area in order to comply with such requirements;
   3. (c) An estimate of the initial capital costs and an estimate of the annual cost of complying with the rule, with an indication of any likely variation in such costs for different types of public and private entities in rural areas;
   4. (d) An indication of how the rule is designed to minimize any adverse impact of such rule on rural areas, including information regarding whether the approaches suggested in subdivision two of this section or other similar approaches were considered; and
   5. (e) A statement indicating how the agency complied with subdivision seven of this section.

5. 4.

   1. (a) This section shall not apply to any rule defined in subparagraph (ii) of paragraph (a) of subdivision two of section one hundred two of this chapter, nor shall it apply to any rule which does not impose an adverse impact on rural areas and which the agency finds would not impose reporting, recordkeeping or other compliance requirements on public or private entities in rural areas. The agency's finding and the reasons upon which the finding was made, including what measures the agency took to ascertain that the rule would not impose such compliance requirements or adverse impact, shall be included in the rule making notice as required by section two hundred two of this chapter.
   2. (b) A rule determined by an agency to be a consensus rule and proposed pursuant to subparagraph (i) of paragraph (b) of subdivision one of section two hundred two of this article shall be exempt from the requirements of this section.
6. 5. In order to avoid duplicative action, an agency may consider a series of closely related rules as one rule for the purpose of complying with subdivision three of this section.
7. 6. In complying with the provisions of subdivision three of this section, an agency may provide either a quantifiable or numerical description of the effects of a rule or more general descriptive statements if quantification is not practicable or reliable.

8. 7. When any rule is proposed for which a rural area flexibility analysis is required, the agency shall assure that public and private interests in rural areas have been given an opportunity to participate in the rule making through such activities as:

   1. (a) the publication of a general notice of the proposed rule making;
   2. (b) notification of public and private interests in rural areas directly affected by the proposed rule;
   3. (c) the conduct of special public hearings or meetings concerning the proposed rule for those public and private interests affected by the rule; and
   4. (d) the adoption or modification of agency procedural rules that will minimize the cost or complexity of participation in the rule making.

9. 8. Each agency shall issue a revised rural area flexibility analysis when:

   1. (a) the information presented in the analysis submitted pursuant to this section is inadequate or incomplete, provided, however, such revised analysis shall be submitted as soon as practicable to the secretary of state for publication in the state register, provided, further, if such statement exceeds two thousand words, the notice shall include only a summary of such statement in less than two thousand words;
   2. (b) a proposed rule contains any substantial revisions and such revisions necessitate that such analysis be modified; or
   3. (c) there are no substantial revisions in the proposed rule but there are changes in the text of the rule as adopted when compared with the text of the latest published version of the proposed rule and such changes would necessitate that such analysis be modified.