Chapter 227

227.29(4)(b)2. 2. Renders any rules promulgated or otherwise administered by that agency obsolete or unnecessary.

227.29(4)(b)3. 3. Renders, for any reason, any rules promulgated or otherwise administered by that agency not in conformity with or superseded by a state statute, including due to statutory numbering or terminology changes in the enactment.

227.29(4)(b)4. 4. Requires or otherwise necessitates rule making by the agency.

227.29(4)(c) (c) If an agency determines that any consequence specified in par. (b) 1. to 4. results from an enactment or part of an enactment, within 6 months after the applicable effective date for the enactment or part of the enactment, the agency shall do one or more of the following, as applicable, to address the consequence identified by the agency and notify the joint committee for review of administrative rules of its action:

227.29(4)(c)1. 1. Submit a statement of the scope of a proposed rule under s. 227.135 (2), unless the enactment requires otherwise or unless the agency submits a notice to the committee explaining why it is unable to submit the statement of scope within that time period and an estimate of when the agency plans to submit the statement of scope.

227.29(4)(c)2. 2. In the case of an affected rule that the agency determines is an unauthorized rule, as defined in s. 227.26 (4) (a), submit a petition to the legislative council staff under s. 227.26 (4) (b) 1.

227.29(4)(c)3. 3. In the case of a consequence specified under par. (b) 3. that can be addressed by the legislative reference bureau using its authority under s. 13.92 (4) (b), submit a request to the legislative reference bureau to use that authority.

227.29 History History: 2017 a. 108.

227.30 227.30 Review of administrative rules or guidelines.

227.30(1) (1) The small business regulatory review board may review the rules and guidelines of any agency to determine whether any of those rules or guidelines place an unnecessary burden on the ability of small businesses, as defined in s. 227.114 (1), to conduct their affairs. If the board determines that a rule or guideline places an unnecessary burden on the ability of a small business to conduct its affairs, the board shall submit a report and recommendations regarding the rule or guideline to the joint committee for review of administrative rules and to the agency.

227.30(2) (2) When reviewing the report, the joint committee for review of administrative rules shall consider all of the following:

227.30(2)(a) (a) The continued need for the rule or guideline.

227.30(2)(b) (b) The nature of the complaints and comments received from the public regarding the rule or guideline.

227.30(2)(c) (c) The complexity of the rule or guideline.

227.30(2)(d) (d) The extent to which the rule or guideline overlaps, duplicates, or conflicts with federal regulations, other state rules, or local ordinances.

227.30(2)(e) (e) The length of time since the rule or guideline has been evaluated.

227.30(2)(f) (f) The degree to which technology, economic conditions, or other factors have changed in the subject area affected by the rule or guideline since the rule or guideline was promulgated.

227.30(3) (3) The joint committee for review of administrative rules may refer the report regarding the rule or guideline to the presiding officer of each house of the legislature for referral to a committee under s. 227.19 (2) or may review the rule or guideline as provided under s. 227.26.

227.30 History History: 2003 a. 145; 2005 a. 249.

subch. III of ch. 227 SUBCHAPTER III

ADMINISTRATIVE ACTIONS AND JUDICIAL REVIEW

Subch. III of ch. 227 Cross-reference Cross-reference: See also ch. NR 2, Wis. adm. code.

227.40 227.40 Declaratory judgment proceedings.

227.40(1) (1) Except as provided in sub. (2), the exclusive means of judicial review of the validity of a rule or guidance document shall be an action for declaratory judgment as to the validity of the rule or guidance document brought in the circuit court for the county where the party asserting the invalidity of the rule or guidance document resides or has its principal place of business or, if that party is a nonresident or does not have its principal place of business in this state, in the circuit court for the county where the dispute arose. The officer or other agency whose rule or guidance document is involved shall be the party defendant. The summons in the action shall be served as provided in s. 801.11 (3) and by delivering a copy to that officer or, if the agency is composed of more than one person, to the secretary or clerk of the agency or to any member of the agency. The court shall render a declaratory judgment in the action only when it appears from the complaint and the supporting evidence that the rule or guidance document or its threatened application interferes with or impairs, or threatens to interfere with or impair, the legal rights and privileges of the plaintiff. A declaratory judgment may be rendered whether or not the plaintiff has first requested the agency to pass upon the validity of the rule or guidance document in question.

227.40(2) (2) The validity of a rule or guidance document may be determined in any of the following judicial proceedings when material therein:

227.40(2)(a) (a) Any civil proceeding by the state or any officer or agency thereof to enforce a statute or to recover thereunder, provided such proceeding is not based upon a matter as to which the opposing party is accorded an administrative review or a judicial review by other provisions of the statutes and such opposing party has failed to exercise such right to review so accorded.

227.40(2)(b) (b) Criminal prosecutions.

227.40(2)(c) (c) Proceedings or prosecutions for violations of county or municipal ordinances.

227.40(2)(d) (d) Habeas corpus proceedings relating to criminal prosecution.

227.40(2)(e) (e) Proceedings under s. 66.191, 1981 stats., or s. 40.65 (2), 106.50, 106.52, 303.07 (7) or 303.21 or ss. 227.52 to 227.58 or under ch. 102, 108 or 949 for review of decisions and orders of administrative agencies if the validity of the rule or guidance document involved was duly challenged in the proceeding before the agency in which the order or decision sought to be reviewed was made or entered.

227.40(2)(f) (f) Proceedings under s. 227.114 (6m).

227.40(3) (3) 

227.40(3)(ag) (ag) In any judicial proceeding other than one under sub. (1) or (2), in which the invalidity of a rule or guidance document is material to the cause of action or any defense thereto, the assertion of that invalidity shall be set forth in the pleading of the party maintaining the invalidity of the rule or guidance document in that proceeding. The party asserting the invalidity of the rule or guidance document shall, within 30 days after the service of the pleading in which the party sets forth the invalidity, apply to the court in which the proceedings are had for an order suspending the trial of the proceeding until after a determination of the validity of the rule or guidance document in an action for declaratory judgment under sub. (1).

227.40(3)(ar) (ar) Upon the hearing of the application, if the court is satisfied that the validity of the rule or guidance document is material to the issues of the case, an order shall be entered staying the trial of said proceeding until the rendition of a final declaratory judgment in proceedings to be instituted forthwith by the party asserting the invalidity of the rule or guidance document. If the court finds that the asserted invalidity of the rule or guidance document is not material to the case, an order shall be entered denying the application for stay.

227.40(3)(b) (b) Upon the entry of a final order in the declaratory judgment action, it shall be the duty of the party who asserts the invalidity of the rule or guidance document to formally advise the court of the outcome of the declaratory judgment action so brought as ordered by the court. After the final disposition of the declaratory judgment action the court shall be bound by and apply the judgment so entered in the trial of the proceeding in which the invalidity of the rule or guidance document is asserted.

227.40(3)(c) (c) Failure to set forth the invalidity of a rule or guidance document in a pleading or to commence a declaratory judgment proceeding within a reasonable time pursuant to the order of the court or to prosecute the declaratory judgment action without undue delay shall preclude the party from asserting or maintaining that the rule or guidance document is invalid.

227.40(4) (4) 

227.40(4)(a) (a) In any proceeding pursuant to this section for judicial review of a rule or guidance document, the court shall declare the rule or guidance document invalid if it finds that it violates constitutional provisions or exceeds the statutory authority of the agency or was promulgated or adopted without compliance with statutory rule-making or adoption procedures.

227.40(4)(b) (b) Notwithstanding s. 227.54, in any proceeding under this section for judicial review of a rule, a court may not restrain, enjoin or suspend enforcement of the rule during the course of the proceeding on the basis of the alleged failure of the agency promulgating the rule to comply with s. 227.114.

227.40(4)(c) (c) Notwithstanding par. (a), if a court finds that an agency did not adequately comply with s. 227.114, the court may not declare the rule invalid on that basis but shall order the agency to comply with that section and to propose any amendments to the rule that are necessary within a time specified by the court. Unless the legislature acts under s. 227.26 (2) to suspend the rule, the rule remains in effect while the agency complies with the order.

227.40(5) (5) The joint committee for review of administrative rules shall be served with a copy of the petition in any action under this section and, with the approval of the joint committee on legislative organization, shall be made a party and be entitled to be heard.

227.40(6) (6) Upon entry of a final order in a declaratory judgment action under sub. (1) with respect to a rule, the court shall send an electronic notice to the legislative reference bureau of the court’s determination as to the validity or invalidity of the rule, in a format approved by the legislative reference bureau, and the legislative reference bureau shall publish a notice of that determination in the Wisconsin administrative register under s. 35.93 (2) and insert an annotation of that determination in the Wisconsin administrative code under s. 13.92 (4) (a).

227.40 History History: Sup. Ct. Order, 67 Wis. 2d 585, 775 (1975); 1977 c. 29, 449; 1981 c. 278 s. 6; 1983 a. 90; 1983 a. 191 s. 6; 1985 a. 182 ss. 26, 55 (1), 57; Stats. 1985 s. 227.40; 1987 a. 403 s. 256; 1989 a. 31; 1991 a. 316; 1995 a. 27; 1999 a. 82; 2003 a. 145; 2005 a. 249; 2011 a. 21; 2013 a. 20; 2015 a. 197 s. 51; 2017 a. 369.

227.40 Annotation The plaintiff could not bring a declaratory judgment action under sub. (1) since it could contest the validity of a rule in an action brought against the plaintiff under sub. (2). Phillips Plastics Corp. v. DNR, 98 Wis. 2d 524, 297 N.W.2d 69 (Ct. App. 1980).

227.40 Annotation Establishing pleading requirements for challenging administrative rules. Discussing the record for judicial review and the scope of judicial review. Liberty Homes, Inc. v. DILHR, 136 Wis. 2d 368, 401 N.W.2d 805 (1987).

227.40 Annotation A failure to comply with this section prevented the trial court from acquiring jurisdiction. Harris v. Reivitz, 142 Wis. 2d 82, 417 N.W.2d 50 (Ct. App. 1987).

227.40 Annotation Under sub. (5), the plaintiff must serve the Joint Committee for Review of Administrative Rules within 60 days of filing, pursuant to s. 893.02. Richards v. Young, 150 Wis. 2d 549, 441 N.W.2d 742 (1989).

227.40 Annotation In a conflict between a statute and a rule, the statute controls. Debeck v. DNR, 172 Wis. 2d 382, 493 N.W.2d 234 (Ct. App. 1992).

227.40 Annotation This section encompasses policies or other statements, standards, or orders that meet the definition of a rule under s. 227.01 (13) but have not been promulgated as rules under s. 227.10. Heritage Credit Union v. Office of Credit Unions, 2001 WI App 213, 247 Wis. 2d 589, 634 N.W.2d 593, 00-3162.

227.40 Annotation The trial court erred by denying a motion to change venue to Dane County when the motion asserted that a Department of Corrections system was a rule, although it was never promulgated as a rule, and therefore, the “rule” was invalid. Johnson v. Berge, 2003 WI App 51, 260 Wis. 2d 758, 659 N.W.2d 418, 02-0911.

227.40 Annotation Although administrative agencies do not have the power to declare statutes unconstitutional, and the lack of authority has been a basis for not applying the exhaustion of administrative remedies doctrine, if the agency has the authority to provide the relief requested without invalidating the rule, a constitutional basis for a claim does not in itself support an exception to the rule. Metz v. Veterinary Examining Board, 2007 WI App 220, 305 Wis. 2d 788, 741 N.W.2d 244, 06-1611.

227.40 Annotation A challenge to a policy on the basis that it is actually a rule is to be construed as a challenge to the validity of a rule, and the requirements of this section do apply. Because the challenge falls under this section, the petitioner was required to serve the Joint Committee for Review of Administrative Rules with a copy of her petition. Because she failed to do so, the court lacked competency to review the issue. Mata v. Department of Children & Families, 2014 WI App 69, 354 Wis. 2d 486, 849 N.W.2d 908, 13-2013.

227.40 Annotation Even without the statutory presumption in s. 227.20 (3), the party challenging the validity of rules has the burden of proving the invalidity of the rules. Wisconsin Realtors Ass’n v. PSC, 2015 WI 63, 363 Wis. 2d 430, 867 N.W.2d 364 13-1407.

227.40 Annotation The Standard of Review of Administrative Rules in Wisconsin. Zabrowski. 1982 WLR 691.

227.40 Annotation How to review an administrative rule. Levine. WBB Oct. 1983.

227.40 Annotation Challenging a State Agency Regulation. Webendorfer. Wis. Law. Nov. 2017.

227.41 227.41 Declaratory rulings.

227.41(1) (1) Except as provided in sub. (5), any agency may, on petition by any interested person, issue a declaratory ruling with respect to the applicability to any person, property or state of facts of any rule or statute enforced by it. Full opportunity for hearing shall be afforded to interested parties. A declaratory ruling shall bind the agency and all parties to the proceedings on the statement of facts alleged, unless it is altered or set aside by a court. A ruling shall be subject to review in the circuit court in the manner provided for the review of administrative decisions.

227.41(2) (2) Petitions for declaratory rulings shall conform to the following requirements:

227.41(2)(a) (a) The petition shall be in writing and its caption shall include the name of the agency and a reference to the nature of the petition.

227.41(2)(b) (b) The petition shall contain a reference to the rule or statute with respect to which the declaratory ruling is requested, a concise statement of facts describing the situation as to which the declaratory ruling is requested, the reasons for the requested ruling, and the names and addresses of persons other than the petitioner, if any, upon whom it is sought to make the declaratory ruling binding.

227.41(2)(c) (c) The petition shall be signed by one or more persons, with each signer’s address set forth opposite the signer’s name, and shall be verified by at least one of the signers. If a person signs on behalf of a corporation, limited liability company or association, that fact also shall be indicated opposite that person’s name.

227.41(3) (3) Except as provided in sub. (5) (b), the petition shall be filed with the administrative head of the agency or with a member of the agency’s policy board.

227.41(4) (4) Except as provided in sub. (5) (c), within a reasonable time after receipt of a petition pursuant to this section, an agency shall either deny the petition in writing or schedule the matter for hearing. If the agency denies the petition, it shall promptly notify the person who filed the petition of its decision, including a brief statement of the reasons therefor.

227.41(5) (5) 

227.41(5)(a) (a) The department of revenue shall, on petition by any interested person, or any group or association of interested persons, issue a declaratory ruling with respect to the applicability to any person, property, or state of facts of any rule or statute enforced by it. The department of revenue may issue a declaratory ruling on the facts contained in the petition. If the department of revenue does not deny the petition or issue a declaratory ruling on the facts contained in the petition, the department of revenue shall hold a hearing, as provided under s. 227.44, and shall afford all interested parties an opportunity to participate in the hearing. A declaratory ruling shall bind the department and all parties to the proceedings on the statement of facts contained in the ruling, unless it is altered or set aside by the tax appeals commission or a court or the applicable rule or statute is repealed or materially amended. A ruling, including the denial of the petition, shall be subject to review by the tax appeals commission as provided in ch. 73.

227.41(5)(b) (b) A petition under par. (a) shall conform to the requirements under sub. (2) and be filed with the secretary of revenue.

227.41(5)(c) (c) No later than 30 days after the day that the secretary of revenue receives a petition under this subsection, the department of revenue shall deny the petition in writing, issue a notice that it will issue a declaratory ruling on the facts contained in the petition, in which case the department of revenue shall issue the ruling no later than 90 days after issuing the notice, or schedule the matter for hearing. The department may deny the petition only if the petition fails to comply with the requirements under sub. (2) and par. (b) or if the department determines that the petition is frivolous, a justiciable controversy does not exist, the ruling would not provide guidance on matters of general applicability, or the ruling would substitute for other procedures available to the parties for resolution of the dispute. If the department denies the petition, it shall promptly notify the person who filed the petition of its decision and include with the notice a brief statement of the reasons for denying the petition. The department may not deny a petition for lack of a justiciable controversy solely because the only parties to the matter are the petitioner and the department.

227.41(5)(d) (d)

227.41(5)(d)1. 1. If the department of revenue does not deny the petition, or issue a notice that it will issue a declaratory ruling based on the facts contained in the petition, the department shall hold a hearing and determine, no later than 180 days after the secretary receives the petition, whether the petitioner has presented sufficient facts from which to issue a declaratory ruling. The department of revenue, petitioner, and other parties may take and preserve evidence prior to and during the hearing using the methods allowed to parties under s. 227.45. With the agreement of the parties, the department may rule on the petition based on facts stipulated by the parties.

227.41(5)(d)2. 2. If the department determines that it does not have sufficient facts from which to issue a declaratory ruling, the department may deny the petition. If the department determines that it has sufficient facts from which to issue a declaratory ruling, the department shall issue a ruling on the merits of the petition no later than 180 days after the determination, unless the deadline is extended by written agreement of all parties. The ruling may deny the petition on the grounds that the petition is frivolous, a justiciable controversy does not exist, the ruling would not provide guidance on matters of general applicability, or that the ruling would substitute for other procedures available to the parties for resolution of the dispute.

227.41 History History: 1985 a. 182 s. 27; Stats. 1985 s. 227.41; 1991 a. 316; 1993 a. 112; 2011 a. 68; 2013 a. 165.

227.41 Annotation When a party files an application for a license with an administrative agency and the latter points to some announced agency policy of general application as a reason for rejecting the application, such announced policy constitutes a rule, the validity of which the applicant is entitled to have tested in a declaratory action. Schoolway Transportation Co. v. Division of Motor Vehicles, 72 Wis. 2d 223, 240 N.W.2d 403 (1976).

227.41 Annotation Res judicata does not apply to administrative agency proceedings, but this section requires internal consistency within a proceeding by binding the agency within that proceeding to its own declaratory ruling. Board of Regents v. Wisconsin Personnel Commission, 103 Wis. 2d 545, 309 N.W.2d 366 (Ct. App. 1981).

227.41 Annotation This section does not provide a method for review of a determination already made by the agency, but only a method for requesting an agency to make a determination. Therefore, this section could not be used by prisoners to challenge the Department of Corrections’ dismissal of their complaint under the inmate complaint review system. Aiello v. Litscher, 104 F. Supp. 2d 1068 (2000).

227.42 227.42 Right to hearing.

227.42(1) (1) In addition to any other right provided by law, any person filing a written request with an agency for hearing shall have the right to a hearing which shall be treated as a contested case if:

227.42(1)(a) (a) A substantial interest of the person is injured in fact or threatened with injury by agency action or inaction;

227.42(1)(b) (b) There is no evidence of legislative intent that the interest is not to be protected;

227.42(1)(c) (c) The injury to the person requesting a hearing is different in kind or degree from injury to the general public caused by the agency action or inaction; and

227.42(1)(d) (d) There is a dispute of material fact.

227.42(2) (2) Any denial of a request for a hearing shall be in writing, shall state the reasons for denial, and is an order reviewable under this chapter. If the agency does not enter an order disposing of the request for hearing within 20 days from the date of filing, the request shall be deemed denied as of the end of the 20-day period.

227.42(3) (3) This section does not apply to rule-making proceedings or rehearings, or to actions where hearings at the discretion of the agency are expressly authorized by law.

227.42(5) (5) Except as provided under s. 289.27 (1), this section does not apply to any part of the process for approving a feasibility report, plan of operation or license under subch. III of ch. 289 or s. 291.23, 291.25, 291.29 or 291.31, any decision by the department of natural resources relating to the environmental impact of a proposed action under ch. 289 or 291 or ss. 292.31 and 292.35, or any part of the process of negotiation and arbitration under s. 289.33.

227.42(6) (6) This section does not apply to a decision issued or a hearing conducted under s. 291.87.

227.42 History History: 1975 c. 414; 1977 c. 418; Stats. 1977 s. 227.064; 1979 c. 221; 1981 c. 374; 1983 a. 298; 1985 a. 182 s. 28; Stats. 1985 s. 227.42; 1995 a. 227; 2009 a. 219; 2013 a. 20; 2013 a. 116 s. 31; 2017 a. 134.

227.42 Annotation A person who satisfies the conditions under sub. (1) is entitled to a hearing whether or not that person has any “other right provided by law.” Milwaukee Metropolitan Sewerage District v. DNR, 126 Wis. 2d 63, 375 N.W.2d 649 (1985).

227.42 Annotation An applicant denied a racetrack license had a right to a contested case hearing. Metropolitan Greyhound Management Corp. v. Wisconsin Racing Board, 157 Wis. 2d 678, 460 N.W.2d 802 (Ct. App. 1990).

227.42 Annotation Sub. (1) does not grant the right to a contested case hearing regarding the need for an environmental impact statement. North Lake Management District v. DNR, 182 Wis. 2d 500, 513 N.W.2d 703 (Ct. App. 1994).