Regulatory review

The regulatory review process allows the executive branch of the United States federal government to ensure that the regulations drafted by different agencies contribute to the current administration's overall goals. Regulatory review is also carried on at the state level, although the organizational structure of these councils or commissions varies somewhat from state to state. In the past the regulatory review process has emphasized a cost-benefit analysis that has tended to delay or halt the publication of environmental regulations. This pattern shifted after 1993 to a greater emphasis on citizen participation in the process of rulemaking.

Executive agencies carry out congressionally enacted laws by drafting and enforcing regulations. The Environmental Protection Agency (EPA) has responsibility for writing the regulations that implement environmental laws, like the Clean Air Act and the Comprehensive Environmental Response, Compensation and Liability Act (Superfund). For example, when the Resource Conservation and Recovery Act (RCRA) called for states to protect groundwater from landfill leachate, the EPA drafted a regulation that included specifications for the kind of equipment that landfills should install to ensure that leachate would not leak.

An emerging concern in regulatory review is the spiraling costs of regulations related to the environment . The price tag on environmental regulation has tripled over the last quarter century, from about $80 billion in 1977 to more than $267 billion in 2000. In addition, a recent study of regulatory review found that federal agencies involved with environmental regulations received the largest increases in the federal budget in recent years, the EPA in particular receiving an increase of over $1 billion for the fiscal year 2002.

Once drafted, before being published for public comment, all regulations are sent for review to the Office of Information and Regulatory Affairs (OIRA) within the Office of Management and Budget (OMB). OIRA either approves, rejects, or asks for specific changes in the regulation. If a regulation is approved it can be published on the Internet or in hard copy for public comment.

This centralization of the regulatory process was accomplished by Ronald Reagan's executive orders 12291 and 12498. Executive Order 12291, issued in 1981, established a cost-benefit review process. All federal agencies must weigh costs and benefits for each "major" regulation and submit these considerations to OIRA. (A "major" regulation costs more than $100 million or is otherwise deemed major by OIRA.) Agencies cannot publish proposed or final rules until OIRA has ensured that the benefits of a regulation outweigh the costs. Executive Order 12498, issued in 1984, requires agency heads to predict their regulatory actions for the following year. All regulations are then compiled into the Regulatory Program. Compiling this program allows OIRA to be involved in the early planning stages of all regulations.

In September 1993, Executive Orders 12291 and 12498 were replaced by President Clinton with Executive Order 12866 on regulatory planning and review. While Executive Order 12866 left the basic structure of OIRA in place, including the figure of $100 million as the standard of a major regulation, the order was intended to harmonize federal regulations regarding the environment with related state, local, and tribal regulations and procedures. The order also allowed for negotiated rulemaking and other consensual approaches to developing regulations in appropriate situations. A third important feature of Executive Order 12866 is its emphasis on transparency; that is, federal agencies are not only required to "provide the public with meaningful participation in the regulatory process," but also to allow time for comments on proposed regulations. To facilitate citizens' participation and response, all regulatory information is to be provided to the public "in plain, understandable language."

Executive Order 12866 became the basis for the establishment of two online databases maintained by OMB for purposes of regulatory review and communication with the public. OIRA has a Regulation Tracking System, or REGS, to monitor the regulatory review process. When a proposed regulation is submitted to OIRA, the REGS system verifies the information contained in the document and assigns each submission a unique OMB tracking number. It then prints out a worksheet for review. After the worksheet has been reviewed, its contents are entered into the REGS system and maintained in its database. REGS also provides a listing, updated daily, of all pending and recently approved regulations on the OMB home page. The OIRA Docket Library maintains certain records related to proposed Federal regulatory actions reviewed by OIRA under Executive Order 12866. Telephone logs and materials from public meetings attended by the OIRA Administrator are also available in the Docket Library. A major upgrading of OIRAs information system is scheduled for the second half of 2002.

Though administrations and policy priorities change, the regulatory review process will most likely remain centralized in the Office of Information and Regulatory Affairs. This office allows the president to ensure that agencies implement legislation through regulations that reflect the central priorities of the administration. For example, Executive Order 13211, signed by President George W. Bush on May 22, 2001, requires federal agencies to submit a formal Statement of Energy Effects to OIRA along with their submissions of proposed regulations. The Statement of Energy Effects must include a description of any negative effects on the supply, distribution, or use of energy that are likely to result from a proposed regulation. These negative effects could include lowered production of coal , oil, gas, or electricity; increased costs; or harm to the environment. The order does not, however, change the basic process of regulatory review.

One structural modification that may be made within the next few years, however, is related to the computerization of government information. As of 2002, the federal government does not have a "seamless" system of data collection, analysis, and use. For the past several decades, government agencies have purchased computers and software systems on their own, without any attempt to coordinate their systems with those of other agencies. The lack of a unified computer language complicates the process of regulatory review as well as contributing to overall inefficiency and higher costs. In the summer of 2002, the Senate passed a bill called the EGovernment Act, intended to help government agencies communicate more effectively with one another as well as make government information more accessible to citizens. The E-Government Act would allocate $345 million over a four-year period to help federal agencies upgrade their online services, and to establish an Office of Electronic Government alongside OIRA under the Office of Management and Budget.

[Alair MacLean and Rebecca J. Frey, Ph.D. ]

RESOURCES

BOOKS

Coleman, B. Through the Corridors of Power: A Citizen's Guide to Federal Rulemaking. Washington, DC: OMB Watch, 1987.

PERIODICALS

Raney, Rebecca Fairley. "Changing Federal Buying Habits." New York Times, July 8, 2002.

OTHER

Dudley, Susan, and Melinda Warren. Regulatory Response: An Analysis of the Shifting Priorities of the U.S. Budget for Fiscal Years 2002 and 2003. Regulatory Report 24, Weidenbaum Center, Washington University, St. Louis, MO.

Federal Register, volume 58, Presidential Documents. Executive Order 12866 of September 30, 1993—Regulatory Planning and Review. Washington, DC: U.S. Government Printing Office, 1993.

Federal Register, volume 66, Presidential Documents. Executive Order 13211 of May 22, 2001—Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. Washington, DC: U.S. Government Printing Office, 2001.

ORGANIZATIONS

Office of Information and Regulatory Affairs (OIRA), The Office of Management and Budget, 725 17th Street, NW, Washington, DC USA 20503 (202) 395-4852, Fax: (202) 395-3888, <http://www.whitehouse.gov/omb/inforeg>