Committee weighs tighter legislative review of agency rules as LSO rolls out regulatory-impact process

At the Management Audit Committee meeting June 18, 2026, Legislative Service Office officials outlined the process the legislature will use to analyze "major rules" under Senate File 127 and answered questions about staffing, timing and exemptions.

LSO Administrator Matt Petri told the committee the 2025 legislation requires LSO to perform a regulatory impact analysis (RAIA) for any rule that either "results in direct or indirect costs of not less than $1 million" to Wyoming's economy or causes "significant adverse effects" on competition, employment, investment, productivity or innovation. "What that is is in layman's terms really a cost–benefit analysis to see whether the rules that an agency is proposing is the best alternative," Petri said.

LSO associate regulatory impact analyst Corey McAuliffe walked members through the agency's implementation plan, which is organized in two phases: early identification and screening before the statutory timeline, and RAIA development after final rule approval by the Secretary of State. McAuliffe described a screening tool and a major-rule agency survey LSO will use to collect baseline information and to prepare a draft RAIA for distribution to legislators and publication on the legislature's website. "LSO has developed a structured process to implement the new RAIA requirement for major rules," McAuliffe said, adding the office will use predictive analytics ‘‘to further quantify estimates for cost–benefit consideration where appropriate." (Corey McAuliffe, LSO)

Why this matters: the change expands legislative review of administrative rules, could increase workload for both agencies and LSO, and may affect the timing of agency implementation when statutes take effect quickly. Petri emphasized the RAIA is typically completed after gubernatorial approval so legislators can consider adopted rules during the next session. He also noted the July 1, 2026 effective date in the underlying law: rules formally adopted on or after that date are potentially subject to RAIA.

Committee members asked detailed questions about how rules are screened and who decides whether a rule is designated major. Petri said LSO will perform an initial independent screening and may ask agencies to complete the screening tool; potential major rules will be placed before management council through email/consent lists and the council will have 10 days to object or remain silent. "If they remain silent that's assumed that there is no objection," he said. Senators and representatives expressed concern that the "significant adverse effects" prong is subjective and could be applied inconsistently across large and small agencies.

A second point of contention was whether emergency rules and rules driven by changes in federal law should be treated the same as regular rules. LSO staff told the committee that emergency rules typically go into effect immediately, often mirror later permanent rules, and are adopted before a public-comment process; conducting a RAIA on an emergency rule risks duplicative work if the permanent rule changes during comment. Committee members and staff discussed possible clarifying language or exemptions for rules required to implement federal statutes and for rules where the state has primacy and must act quickly.

Staffing and resources: the 2025 legislation funded additional LSO positions to implement RAIA work. Petri confirmed one regulatory impact analyst (McAuliffe) has been hired and the office was conducting final interviews for the second position. Members repeatedly raised concerns about the additional workload for smaller agencies that lack fiscal analysis capacity.

Motion and next steps: following extended discussion the committee voted to direct LSO to draft legislation based on last session's proposal but with changes discussed in committee. After deliberation and several attempts to amend the monetary trigger, the committee adopted an amendment setting a $500,000 annual-impact threshold for the draft and directed LSO to prepare language addressing emergency-rule and federal-law concerns for management-council consideration.

The committee reconvened later in the day and will receive the LSO redraft for further consideration.