Rulemaking
OMB's Role in Reviews of Agencies' Draft Rules and the Transparency of Those Reviews Gao ID: GAO-03-929 September 22, 2003Under Executive Order 12866, the Office of Management and Budget's Office of Information and Regulatory Affairs (OIRA) reviews hundreds of agency rules each year before they are published in the Federal Register. Those reviews can have a significant effect on a broad array of public policies. GAO was asked to (1) describe OIRA's review process and any changes in its policies or processes in recent years, (2) provide detailed information about rules submitted by nine health, safety, or environmental agencies that were returned, withdrawn, or changed at OIRA's suggestion, and (3) describe how OIRA decided that certain existing rules merited high priority review.
The formal process by which OIRA reviews agencies' proposed and final rules is essentially unchanged since Executive Order 12866 was issued in 1993. However, there have been several changes in OIRA's policies in recent years, including increased use of public letters explaining why rules were returned to the agencies and prompting the development of new rules, increased emphasis on economic analysis, stricter adherence to the 90-day time limit for OIRA review, and improvements in the transparency of the OIRA review process (although some elements of that process are still unclear). Underlying many of these changes is a shift in how recent OIRA administrators view the office's role in the rulemaking process--from "counselor" to "gatekeeper." OIRA sometimes reviews drafts of rules before they are formally submitted, and OIRA has said it can have its greatest influence on agencies' rules during this informal review period. However, OIRA contends that agencies need only document the changes made to rules during what are sometimes very brief formal review periods. Because about 400 rules were changed, returned, or withdrawn during the 1-year period that GAO examined, the review focused on 85 rules from the nine health, safety, or environmental agencies with five or more such rules. OIRA significantly affected 25 of those 85 rules. The Environmental Protection Agency's rules were most often significantly changed, and almost all of the returned rules were from the Department of Transportation. OIRA's suggestions appeared to have at least some effect on almost all of the 25 rules' potential costs and benefits or the agencies' estimates of those costs and benefits. Outside parties contacted OIRA before or during its formal review regarding 11 of the 25 rules that OIRA significantly affected. In 7 of these 11 cases, at least some of OIRA's recommendations were similar to those of the outside parties, but we could not determine whether those contacts influenced OIRA's actions. The agencies' docket files did not always provide clear and complete documentation of the changes made during OIRA's review or at OIRA's suggestion, as required by the executive order. However, some agencies clearly documented these changes, sometimes including changes suggested during OIRA's informal reviews. OIRA did not publicly disclose how it determined that 23 of the 71 rules nominated by the public for change or elimination in 2001 merited high priority review. As explained to GAO, OIRA desk officers made the initial determinations regarding issues with which they were familiar, subject to the approval by OIRA management. The Mercatus Center at George Mason University made most of the nominations overall and in the high priority group. Regulatory agencies or OIRA have at least begun to address the issues raised in many of the 23 suggestions. OIRA's 2002 nomination and review process was different from the 2001 process in several respects (e.g., broader request for reforms, more responses from more commentors, prioritization of the suggestions being made by the agencies, and clearer discussion of process and criteria).
RecommendationsOur recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
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Report to Congressional Requesters:
September 2003:
Rulemaking:
OMB's Role in Reviews of Agencies' Draft Rules and the Transparency of
Those Reviews:
GAO-03-929:
GAO Highlights:
Highlights of GAO-03-929, a report to congressional requesters
Why GAO Did This Study:
Under Executive Order 12866, the Office of Management and Budget‘s
Office of Information and Regulatory Affairs (OIRA) reviews hundreds
of agency rules each year before they are published in the Federal
Register. Those reviews can have a significant effect on a broad array
of public policies. GAO was asked to (1) describe OIRA‘s review
process and any changes in its policies or processes in recent years,
(2) provide detailed information about rules submitted by nine health,
safety, or environmental agencies that were returned, withdrawn, or
changed at OIRA‘s suggestion, and (3) describe how OIRA decided that
certain existing rules merited high priority review.
What GAO Found:
The formal process by which OIRA reviews agencies‘ proposed and final
rules is essentially unchanged since Executive Order 12866 was issued
in 1993. However, there have been several changes in OIRA‘s policies
in recent years, including increased use of public letters explaining
why rules were returned to the agencies and prompting the development
of new rules, increased emphasis on economic analysis, stricter
adherence to the 90-day time limit for OIRA review, and improvements
in the transparency of the OIRA review process (although some elements
of that process are still unclear). Underlying many of these changes
is a shift in how recent OIRA administrators view the office‘s role in
the rulemaking process”from ’counselor“ to ’gatekeeper.“ OIRA
sometimes reviews drafts of rules before they are formally submitted,
and OIRA has said it can have its greatest influence on agencies‘
rules during this informal review period. However, OIRA contends that
agencies need only document the changes made to rules during what are
sometimes very brief formal review periods.
Because about 400 rules were changed, returned, or withdrawn during
the 1-year period that GAO examined, the review focused on 85 rules
from the nine health, safety, or environmental agencies with five or
more such rules. OIRA significantly affected 25 of those 85 rules. The
Environmental Protection Agency‘s rules were most often significantly
changed, and almost all of the returned rules were from the Department
of Transportation. OIRA‘s suggestions appeared to have at least some
effect on almost all of the 25 rules‘ potential costs and benefits or
the agencies‘ estimates of those costs and benefits. Outside parties
contacted OIRA before or during its formal review regarding 11 of the
25 rules that OIRA significantly affected. In 7 of these 11 cases, at
least some of OIRA‘s recommendations were similar to those of the
outside parties, but we could not determine whether those contacts
influenced OIRA‘s actions. The agencies‘ docket files did not always
provide clear and complete documentation of the changes made during
OIRA‘s review or at OIRA‘s suggestion, as required by the executive
order. However, some agencies clearly documented these changes,
sometimes including changes suggested during OIRA‘s informal reviews.
OIRA did not publicly disclose how it determined that 23 of the 71
rules nominated by the public for change or elimination in 2001
merited high priority review. As explained to GAO, OIRA desk officers
made the initial determinations regarding issues with which they were
familiar, subject to the approval by OIRA management. The Mercatus
Center at George Mason University made most of the nominations overall
and in the high priority group. Regulatory agencies or OIRA have at
least begun to address the issues raised in many of the 23
suggestions. OIRA‘s 2002 nomination and review process was different
from the 2001 process in several respects (e.g., broader request for
reforms, more responses from more commentors, prioritization of the
suggestions being made by the agencies, and clearer discussion of
process and criteria).
What GAO Recommends:
GAO recommends that the OMB Director build on recent improvements that
have been made in the transparency of the OIRA review process. In
particular, GAO recommends that agencies be instructed to document
substantive changes made at OIRA‘s suggestion to draft rules submitted
for review whenever they occur, not just changes that OIRA recommended
during formal reviews.
OMB said the factual foundations of our report were well grounded but
disagreed with most of our recommendations, saying that the report had
not demonstrated the need or desirability of changing the agency‘s
existing level of transparency.
[End of section]
Contents:
Letter:
Executive Summary:
Purpose:
Background:
Results in Brief:
Principal Findings:
Recommendations for Executive Action:
Agency Comments and Our Evaluation:
Chapter 1:
Background:
Objectives, Scope, and Methodology:
Chapter 2: Some of OIRA's Regulatory Review Policies Have Changed:
OIRA Regulatory Review Process:
Changes in Regulatory Review Policies:
Chapter 3: OIRA's Effects on Rules Submitted for Executive Order
Review Varied:
OIRA Significantly Affected About One-Third of the Rules That the
Selected Agencies Submitted for Review:
OIRA Affected the Costs and Benefits or Estimates in Some Rules:
Outside Parties Contacted OIRA Regarding about Half of the Rules OIRA
Significantly Affected:
Documentation of OIRA's Reviews Varied, but Some Agencies' Practices
Improved Transparency:
Chapter 4: Many Rules Nominated for Reform Are Being Changed:
Mercatus Center Nominated Most Rules Selected for High Priority Review
in 2001 Report:
How High Priority Review Selections Were Made:
Status of Rules Selected for High Priority Review:
Second Round of Nominations Was Different:
Chapter 5: Conclusions and Recommendations:
Conclusions:
Recommendations:
Agency Comments and Our Evaluation:
Appendixes:
Appendix I: Objectives, Scope, and Methodology:
Objectives:
Scope and Methodology:
Limitations:
Appendix II: Summary Information on Selected Rules Submitted to OIRA
for Executive Order Review between July 2001 and June 2002:
Explanation of Table Contents:
Appendix III: Case Studies on Significantly Affected Rules With
Evidence That OIRA Was Contacted by External Parties:
Control of Emissions from Nonroad Large Spark Engines:
Proposed Nonconformance Penalties for 2004 and Later Model Year
Emission Standards for Heavy-duty Diesel Engines and Heavy-duty Diesel
Vehicles:
Identification and Listing of Hazardous Waste (Manganese):
Minimizing Adverse Environmental Impact from Cooling Water Intake
Structures at New Facilities:
National Pollutant Discharge Elimination System (Existing Intake
Structures):
Effluent Limitation Guidelines and New Source Performance Standards for
the Construction and Development Category:
Effluent Limitations Guidelines for the Iron and Steel Manufacturing
Point Source Category:
Tire Pressure Monitoring Systems:
Part 145 Review: Repair Stations:
Appendix IV: Status of 23 High Priority Review Rules:
Appendix V: Comments from the Office of the Information and Regulatory
Affairs:
Tables:
Table 1: Selected Agencies' Regulatory Submissions by Outcome:
Table 2: Nature of Changes Made at the Suggestion or Recommendation of
OIRA:
Table 3: Rules from FAA and EPA's Office of Air and Radiation and Office
of Water Were Most Often Significantly Affected by OIRA Review:
Table 4: OIRA Was Only Slightly More Likely to Significantly Affect
Economically Significant Rules:
Table 5: Agencies' Compliance with Executive Order 12866 Documentation
Requirements Was Mixed:
Table 6: The Mercatus Center Suggested Most of the 23 "High-Priority
Review" Rules:
Table 7: Findings and Determinations for Rules Changed after Submission
to OIRA:
Table 8: Findings and Determinations for Rules Returned to Agency after
Submission to OIRA:
Table 9: Findings and Determinations for Rules Withdrawn after
Submission to OIRA:
Table 10: Status of the 23 High Priority Review Suggestions Identified
in OIRA's December 2001 Report on the Costs and Benefits of Federal
Regulations:
Figures:
Figure 1: OIRA Is One of the Statutory Offices within OMB:
Figure 2: Organization of OIRA:
Figure 3: Number of Rules That OIRA Reviewed Dropped Under Executive
Order 12866:
Figure 4: The OIRA Regulatory Review Process:
Figure 5: OIRA Returned More Rules to Agencies in Calendar Year 2001
Than in the 7 Previous Years Combined:
Figure 6: OIRA Returned Only Two Rules Between February 2002 and May
2003:
Figure 7: The Number of OIRA Reviews Lasting More Than 90 Days Dropped
Sharply in 2002:
Figure 8: OIRA Recently Reversed a 20-year Decline in Staffing:
Figure 9: EPA Air and Water Rules Were More Often Significantly Changed
at the Suggestion of OIRA:
Figure 10: Outside Parties Most Often Contacted OIRA Regarding EPA
Rules:
Abbreviations:
APA: Administrative Procedure Act:
Animal and Plant Health Inspection Service:
ARSA: Aeronautical Repair Station Association:
BLM: Bureau of Land Management:
CEA: Council of Economic Advisors:
CEED: Center for Energy and Economic Development:
CFR: Code of Federal Regulations:
CWD: chronic wasting disease:
DOE: Department of Energy:
DOI: Department of the Interior:
DOL: Department of Labor:
DOT: Department of Transportation:
EEAC: Equal Employment Advisory Council:
EEOC: Equal Employment Opportunity Commission:
EPA: Environmental Protection Agency:
EPF: Employment Policy Foundation:
FAA: Federal Aviation Administration:
FDA: Food and Drug Administration:
FMCSA: Federal Motor Carriers Safety Administration:
FTE: full-time equivalent:
HHS: Department of Health and Human Services:
ICR: information collection request:
MACT: maximum achievable control technology:
MGD: million gallons per day:
MOU: memorandum of understanding:
NCP: nonconformance penalty:
NHTSA: National Highway Traffic Safety Administration:
NMMA: National Marine Manufacturers Association:
OFCCP: Office of Federal Contract Compliance Programs:
OIRA: Office of Information and Regulatory Affairs:
OMB: Office of Management and Budget:
OSHA: Occupational Safety and Health Administration:
PRA: Paperwork Reduction Act:
RCRA: Resource Conservation and Recovery Act:
RFG: reformulated gasoline:
RIN: regulation information number:
SBA: Small Business Administration:
SDWA: Safe Drinking Water Act:
TPMS: tire pressure monitoring system:
TSS: total suspended solids:
USDA: Department of Agriculture:
VSL: value of a statistical life:
VSLY: value of a statistical life year:
WRAP: Western Regional Air Partnership:
Letter September 22, 2003:
The Honorable Richard J. Durbin
Ranking Minority Member
Subcommittee on Oversight of Government Management, Restructuring, and
the District of Columbia
Committee on Governmental Affairs
United States Senate:
The Honorable Joseph I. Lieberman
Ranking Minority Member
Committee on Governmental Affairs
United States Senate:
In response to your request, this report on the regulatory review
process of the Office of Management and Budget's (OMB) Office of
Information and Regulatory Affairs (OIRA) (1) describes OIRA's review
process and any changes in its policies or processes in recent years,
(2) provides detailed information about rules submitted by nine health,
safety, or environmental agencies that were returned, withdrawn, or
changed at OIRA's suggestion, and (3) describes how OIRA decided that
certain rules merited "high priority" review. We include
recommendations to the Director of OMB to improve the transparency of
the OIRA review process.
As we agreed with your office, unless you publicly announce the
contents of this report earlier, we will not distribute it until 30
days from the date of this letter. We will then send copies to the
Director of OMB and will provide copies to others on request. It will
also be available at no charge on GAO's Web site at [Hyperlink, http:/
/www.gao.gov] http://www.gao.gov.
If you have any questions concerning this report, please call me or
Curtis Copeland at (202) 512-6806. Key contributors to this report were
Ben Atwater, Tim Bober, and Joseph Santiago.
Signed by:
Victor S. Rezendes
Managing Director, Strategic Issues:
[End of section]
Executive Summary:
Purpose:
The Office of Information and Regulatory Affairs (OIRA) within the
Office of Management and Budget (OMB) is a relatively small office
(currently, 55 full-time equivalents), but it can have a significant--
if not determinative--effect on a broad array of federal regulations
that agencies issue to enact statutes and establish specific
requirements. Under Executive Order 12866, OIRA reviews hundreds of
significant proposed and final rules from all federal agencies (other
than independent regulatory agencies) before they are published in the
Federal Register. As a result of OIRA's review, many draft rules are
changed before publication, withdrawn before a review is completed, or
returned to the agencies because, in OIRA's opinion, certain aspects of
the rule need to be reconsidered.
Despite its importance, OIRA's regulatory review function generally is
not well documented or well understood. Therefore, the Ranking Minority
Members of the Senate Committee on Governmental Affairs and its
Subcommittee on Oversight of Government Management, the Federal
Workforce, and the District of Columbia requested that we examine and
report on certain aspects of OIRA's operations. Specifically, we were
asked to (1) describe OIRA's current regulatory review policies and
processes and determine whether, and if so how, those policies have
changed in recent years, (2) provide detailed information about the
effects of OIRA's reviews of rules submitted by nine health, safety,
and environmental agencies that were returned to the agencies for
reconsideration, withdrawn at OIRA's request, or significantly changed
in response to OIRA's reviews during a 1-year period, and (3) describe
how OIRA determined that certain existing rules listed in its reports
to Congress on the costs and benefits of federal regulations merited
high priority review for potential modification or rescission. We also
examined the transparency of the OIRA's review process. To address
these objectives, we interviewed OIRA representatives, former OIRA
officials, agency officials, and others knowledgeable about the OIRA
review process. We also examined documentation at both OIRA and
regulatory agencies to determine the effect of OIRA's reviews. Specific
elements of our methodology are discussed in the sections below.
Background:
The Paperwork Reduction Act of 1980 established OIRA to provide central
agency leadership and oversight of governmentwide efforts to reduce
unnecessary paperwork burden and manage information resources. In 1981,
OIRA's responsibilities expanded when Executive Order 12291 authorized
it to review all proposed and final regulations from nonindependent
regulatory agencies--between 2,000 and 3,000 rules each year. OIRA's
regulatory review function under this executive order was highly
controversial, with concerns raised about its effects on separation of
powers, public participation, transparency, and the timeliness of
agencies' rulemaking efforts. In September 1993, Executive Order 12866
replaced Executive Order 12291 and made several changes to OIRA's
regulatory review function. For example, Executive Order 12866 limits
OIRA's regulatory reviews to nonindependent agencies' "significant
regulatory actions" (e.g., rules expected to have an annual effect of
$100 million or more on the economy or raising other coordination,
budgetary, or policy issues). As a result, the number of OIRA reviews
declined to about 500 to 700 each year. The executive order also
generally requires OIRA to complete its review within 90 days after an
agency formally submits a draft regulation, and contains several
"transparency" provisions that require both OIRA and the agencies to
disclose certain information about the review process. For example,
section 6 of the order requires agencies to publicly identify the
substantive changes made to rules during OIRA's review and at OIRA's
suggestion or recommendation. It also requires OIRA to disclose all of
the documents exchanged between the agencies and OIRA during the review
process. The executive order and related OIRA guidance also identify
some regulatory principles and analytical practices (e.g., considering
the costs and benefits of a proposed regulation and assessing
alternative approaches) that help to guide OIRA's reviews of agencies'
draft regulatory actions.
In January 1998, we reported on the implementation of the transparency
requirements in Executive Order 12866 that are applicable to rulemaking
agencies.[Footnote 1] We concluded that complete documentation of all
substantive changes made in the rules, and of all the changes that OIRA
had suggested, was available to the public for only about one-quarter
of the 122 rules that we reviewed. The agencies' rulemaking dockets had
only some or no documentation for the remaining rules, and we could not
always determine whether OIRA had made available all relevant documents
exchanged between the agencies and OIRA. We recommended that the
Director of OMB provide the agencies with guidance on how to implement
these transparency requirements. OMB disagreed with our recommendations
in this area and did not implement them.
Results in Brief:
OIRA's formal review process is essentially unchanged since Executive
Order 12866 was issued in 1993. However, there have been several
changes in OIRA policies and practices in recent years, particularly
since the current OIRA Administrator took office in July 2001. Those
changes, some of which the Administrator said would "have a long-
lasting impact on the regulatory state," include increased use of
public letters explaining why OIRA returned rules to the agencies for
their reconsideration (return letters) and suggesting regulatory action
(prompt letters), increased emphasis on benefit-cost analysis and peer
review, stricter adherence to the 90-day time limit for OIRA review,
improvements in the transparency of the OIRA review process, and an
increase in the size and skills of OIRA's staff. However, some of these
changes are not as significant a departure from previous practice as
they initially appear. Underlying many of the changes in OIRA's
policies is a shift in how the Administrator (and, ultimately, the
President) views OIRA's role in the regulatory process--less of a
"counselor" to the agencies and more of a "gatekeeper." Prior to the
formal executive order review process, OIRA sometimes informally
reviews agencies' draft rules, and OIRA has said it can have a
significant influence on the rules during this informal review period.
OIRA's database indicated that about 400 draft rules were changed,
returned, or withdrawn from OIRA during the 1-year period from July
2001 through June 2002. Therefore, we focused our examination of the
effects of OIRA's review on 85 changed, returned, or withdrawn rules
that had been submitted by the nine health, safety, or environmental
agencies with 5 or more such rules.[Footnote 2] We concluded that OIRA
had significantly affected 25 of the 85 rules by suggesting changes
that revised the scope, impact, or costs and benefits of the rules,
returning the rules for reconsideration by the agency, or, in one case,
requesting that the agency withdraw the rule from review. The
Environmental Protection Agency's (EPA) rules were most often
significantly changed, and almost all of the returned rules were from
the Department of Transportation (DOT), as was the rule withdrawn at
OIRA's request. Many of OIRA's actions in these cases appeared to have
been prompted by concerns about the cost and cost effectiveness of the
regulatory options that agencies selected, in keeping with general
principles established by Executive Order 12866 and related OIRA
guidance. In almost all of the 25 rules that were significantly
affected, OIRA's actions appeared to have at least some effect on the
potential costs and benefits associated with the rule or prompted
revisions to the agency's estimates of those costs and benefits. As
permitted by the executive order, outside parties contacted OIRA before
or during the formal review period regarding 11 of these 25
rules.[Footnote 3] Although OIRA's positions regarding 7 of the 11
rules were similar in some respects to those expressed by the outside
parties, it is impossible to determine the extent to which those
contacts might have influenced OIRA's actions, if at all. OIRA might
have reached the same conclusions in the absence of those contacts. The
transparency of the agencies' and OIRA's actions during these 85
reviews varied, with the docket files for between 45 percent and 62
percent of the rules providing clear and complete documentation of all
elements expected under the two relevant portions of the executive
order. However, a few agencies exhibited exemplary transparency
practices.
In May 2001, OIRA asked the public to nominate rules that it believed
should be modified or rescinded. OIRA decided that 23 of the 71
nominations that it received merited high priority review, but did not
publicly disclose how those determinations were made. Representatives
of OIRA told us that the agency's desk officers initially determined
which nominations should be placed in the high priority category,
subject to the approval by OIRA management, with the final decisions
made by the Administrator. Forty-four of the 71 nominations were from
the Mercatus Center at George Mason University, as were 14 of the 23
high priority nominations.[Footnote 4] As of May 2003, regulatory
agencies or OIRA had addressed or begun to address the issues raised in
many of these 23 suggestions. In March 2002 OIRA again solicited public
comments on regulations in need of reform. However, this effort was
different from the 2001 process in several respects (e.g., broader
request for reforms, more responses from more commentors, no ranking of
the suggestions being made by the agencies, nominations to strengthen
rules, and clearer discussion of process and criteria).
Although both OIRA and some of the rulemaking agencies have improved
the transparency of the regulatory review process, our review indicated
that some elements of the process remain unclear. For example, neither
OIRA nor the agencies are required to disclose why rules are withdrawn
from review, and the descriptions that OIRA discloses about its
contacts with outside parties is often not very helpful. In particular,
OIRA representatives said neither they nor the rulemaking agencies are
required to disclose the changes made to rules while they are under
informal review--the period in which OIRA said it can have its greatest
effect. This interpretation of this aspect of the executive order's
transparency requirements restricts those requirements to the formal
review period, which can be as short as 1 day.
Principal Findings:
:
OIRA's Regulatory Review Process and Changes in Policies/Practices:
OIRA's formal regulatory review process begins when the rulemaking
agency sends a draft proposed or final rule and other parts of the
review package to OIRA. OIRA desk officers do not use a standard
"checklist" in their reviews, but most OIRA regulatory reviews are
similar in that all rules must be consistent with applicable law, the
President's priorities, and the principles in Executive Order 12866,
and must not conflict with the policies or practices of other agencies.
OIRA regulatory reviews differ somewhat depending on the content of the
draft rules. For example, if the rule contains a collection of
information under the Paperwork Reduction Act, the desk officer would
also review the rule for compliance with that act. If the draft rule is
"economically significant," the desk officer would review the agency's
economic analysis. There is usually some form of communication between
OIRA and the agency during the review, most commonly by e-mail or
telephone. OIRA desk officers always consult with and obtain the
consent of the appropriate resource management officer on the budget
side of OMB before approving a rule. OIRA may also consult with others
within the Executive Office of the President or other agencies,
managing an interagency review process.
In some cases, OIRA also reviews drafts of agencies' rules before
formal submission (e.g., large rules with statutory or judicial
deadlines and/or that require discussions with other agencies). OIRA
indicated that these informal reviews are increasing, and that reviews
before formal submission can have a substantial effect on the agencies'
regulatory analysis and the substance of the rules--before the
agencies' positions become too entrenched. OIRA also informally
consulted with agencies and reviewed agencies' draft rules before
formal submission during previous administrations.
OIRA representatives told us that the formal process the office uses to
review draft rules has been essentially the same since Executive Order
12866 was established in 1993. However, several notable changes in
OIRA's policies and practices have occurred since the current
Administrator took office in July 2001, including (1) an overall
resurgence in the "gatekeeper" role that OIRA played shortly after it
was established, (2) increased use of return letters, (3) greater
emphasis on economic analysis and the issuance of new draft guidelines
on economic analysis, (4), fewer reviews extending beyond the 90-day
limit, (5) the use of "prompt" letters that suggest regulatory
priorities to the agencies, (6) improvements in the transparency of
OIRA's regulatory review process (e.g., electronic access to
information about rules under review and fuller disclosure of OIRA's
contacts with outside parties), and (7) expansion of the size and
expertise of OIRA staff. In some cases, though, the changes are less
different from previous practices than they initially appear. For
example, in the first 8 months after the Administrator took office,
OIRA returned 21 of the nearly 400 rules it reviewed to the agencies--
more returns than in the previous 7 years combined. However, in the
subsequent 15 months OIRA returned only 2 of the more than 850 rules
that it reviewed. Also, OIRA prompted agencies to initiate rulemaking
in particular areas during previous administrations--albeit not through
public letters.
OIRA's Effect on Changed, Withdrawn, and Returned Rules:
Because of the large number of draft rules that had been changed,
withdrawn, or returned to the agencies from July 1, 2001, through June
30, 2002, we focused our analysis on the rules that were submitted by
health, safety, or environmental agencies or offices with five or more
rules that were changed, withdrawn, or returned during this 1-year
period.[Footnote 5] This resulted in the selection of 85 rules from 9
agencies: the Animal and Plant Health Inspection Service (APHIS) within
the Department of Agriculture;
the Food and Drug Administration (FDA) within the Department of Health
and Human Services; the Occupational Safety and Health Administration
(OSHA) within the Department of Labor; the Federal Aviation
Administration (FAA), Federal Motor Carrier Safety Administration
(FMCSA), and National Highway Traffic Safety Administration (NHTSA)
within DOT; and the Offices of Air and Radiation, Solid Waste and
Emergency Response, and Water within EPA.
We concluded that OIRA's review had a significant effect on 25 of the
85 draft rules. In 17 of the 25 rules, OIRA recommended the revision,
elimination, or delay of certain provisions in the draft regulatory
text, the addition or revision of regulatory alternatives that provided
more flexible and/or less costly compliance options, or the revision of
agencies' cost and/or benefit estimates for the rules. EPA submitted 14
of the 17 rules that were significantly changed at OIRA's suggestion.
For example, at OIRA's suggestion, EPA took the following actions:
* Eliminated manganese from a list of hazardous constituents in a final
rule on the identification and listing of hazardous wastes (see app.
II, ID 56).
* Delayed the compliance date for states to report two types of
emissions in a final rule on consolidated emissions reporting (ID 50).
* Made compliance requirements more flexible in a proposed rule on
pollutant discharge elimination systems for large cooling water intake
structures at existing power generating facilities by allowing options
for a site-specific approach to minimizing environmental harm (ID 68).
* Revised the benefit-cost and cost-effectiveness estimates in a
proposed rule on emissions from spark ignition marine vessels and
highway motorcycles (ID 54).
OIRA returned 7 of the 25 rules to the agencies for reconsideration (6
of which had been submitted by DOT). For example, OIRA returned a NHTSA
final rule on tire pressure monitoring systems because, in the office's
opinion, the agency's analysis did not adequately demonstrate that
NHTSA
had selected the best available regulatory alternative (ID
78).[Footnote 6] OIRA returned a proposed FAA rule on certification of
pilots, aircraft, and repairmen for the operation of light sport
aircraft because it believed that the agency's regulatory analysis did
not sufficiently justify the rule (ID 73). OIRA also requested that an
FAA rule be withdrawn by the agency. Overall, we determined that rules
submitted by three of the agencies (FAA, EPA's Office of Air and
Radiation, and EPA's Office of Water) were much more often
significantly affected by OIRA's review than rules submitted by the
other six agencies in our study.
In 22 of the 25 rules that OIRA significantly affected, the changes
appeared to have an effect on either the costs and/or benefits of the
rules or the agencies' estimates of those costs and/or benefits. For
example, in the above-mentioned EPA rule on cooling water intake
structures, the approach that OIRA recommended was expected to have
somewhat lower benefits than the approach EPA proposed but was
estimated to cost significantly less, thereby yielding much larger net
benefits. In the tire pressure monitoring system rule, NHTSA inserted
(at OIRA's suggestion) additional estimates of some costs and benefits
of regulatory alternatives and added information about benefits that
might be realized with different regulatory alternatives.
In 34 of the 60 rules that OIRA did not significantly affect, the
changes that OIRA suggested primarily involved revisions to the
language in the preambles of the draft rules (e.g., expanding or
clarifying agencies explanations of certain issues) or suggestions that
the agencies request public comments on particular issues. Although we
did not consider these types of changes to be "significant," they were
substantive in that they made the rules easier to understand and/or
could affect the final versions of the rules. OIRA suggested only minor
editorial changes or no changes to 20 rules and returned 2 others for
procedural rather than substantive reasons. Four rules were withdrawn
from OIRA's review solely at the agencies' initiative or because of a
"mutual decision" made by the agencies and OIRA.
Materials in the OIRA docket or the rulemaking agencies' dockets
indicated that outside parties (most commonly representatives of
regulated entities) had contacted OIRA regarding 11 of the 25 rules
that OIRA significantly affected (including 8 of the 15 rules submitted
by EPA that were significantly affected). In 7 of the 11 rules, at
least some of the actions that OIRA recommended were similar to those
suggested to OIRA by outside parties. For example:
* In the above-mentioned rule on cooling water intake structures,
OIRA's suggested revisions of the regulatory language regarding the use
of a site-specific approach to minimizing environmental harm were
similar to those previously recommended by representatives of the
electric industry during their contacts with OIRA (ID 68).
* In letters and meetings with OIRA, representatives from steel
manufacturers and a chemical company opposed the listing of manganese
as a hazardous waste constituent in an EPA final rule (ID 56).
Subsequently, the main focus of OIRA's suggested changes to this rule
was the deferral of final action on all parts of the rule identifying
manganese as a hazardous constituent.
However, it is impossible to determine whether OIRA's contacts with
those outside parties affected its conclusions; OIRA may have reached
the same conclusions without those contacts. In the four other cases,
OIRA's recommended actions did not appear to be similar to those
suggested by outside parties. OIRA generally disclosed its contacts
with outside parties; we identified only four such contacts regarding
the rules in our review that OIRA had not disclosed. However, because
our knowledge of such contacts is generally limited to what OIRA or the
agencies disclose, we cannot be sure that there were not other contacts
that did not come to our attention.
Rules and Regulatory Programs Selected for High Priority Review:
Congress has required OMB to submit "recommendations for reform" with
its recent reports on the costs and benefits of federal regulations. In
May 2001, OIRA asked the public to suggest "specific regulations that
could be rescinded or changed that would increase net benefits to the
public." Of the 71 nominations that OIRA received, 44 were from the
Mercatus Center at George Mason University. OIRA reviewed the
suggestions and selected 23 of them for high priority review--including
14 of the 44 Mercatus nominations. In its December 2001 final report,
OIRA said the high priority designation indicated that it was inclined
to agree with the recommendation. However, OIRA did not indicate in the
report how it made that determination. OIRA representatives described
the process to us as a "bottom up" exercise, with desk officers making
the initial determinations and the final decisions being made by the
OIRA Administrator. Five of the 23 rules designated for high priority
review had been issued at the end of the Clinton Administration, and 13
had been issued by EPA or were environmental in nature.
As of May 2003, most of these 23 high-priority review items were at
least in the process of being addressed by either the rulemaking
agencies or OIRA. For example:
* One of the nominations focused on a Department of Energy (DOE) rule
issued in January 2001 that would have raised the energy efficiency of
new central air conditioners by 30 percent. In May 2002, DOE withdrew
the rule and issued a new rule raising the efficiency level by 20
percent.
* An EPA July 2000 final rule regarding allowable amounts of pollution
in water ("total maximum daily load") was also the subject of a
suggested change. In March 2003, EPA published a final rule withdrawing
the July 2000 rule. By May 2003, a draft of a new proposed rule was
undergoing informal interagency review.
However, in a few cases the agencies and/or OIRA decided not to take
any action or had not made a decision regarding the rules in question.
In March 2002, OIRA again asked the public to nominate rules for
reform, and received suggestions involving 267 regulations and 49
guidance documents from approximately 1,700 individuals, trade
associations, nonprofit organizations, and others. In contrast to the
first round, OIRA asked the public to nominate not only regulations
that could be rescinded or changed, but also rules that could be
expanded. Also, OIRA did not designate certain nominated rules for high
priority review. Instead, OIRA forwarded the nominations to the
appropriate agencies for their review and prioritization, and suggested
that the agencies rely on three criteria: efficiency, fairness, and
practicality. Although most of the nominations sought modifications
that would increase regulatory flexibility or rescind rules, more than
a quarter of them suggested making rules more stringent or developing
new rules.
Improvements Notwithstanding, OIRA's Review Process Is Still Not Well
Documented or Clear:
OIRA and some of the agencies whose rules we examined have taken
several steps to improve the transparency of the regulatory review
process and its outcomes since our last review. For example, OIRA's
disclosure of its contacts with outside parties is now triggered by the
start of informal review, not just formal reviews, and OIRA is now
providing electronic access to review information. Also, some agencies'
dockets now more clearly indicated the changes made to their rules than
was the case during our previous review 5 years ago, and some agencies'
practices in this area were exemplary (FDA, FMCSA, and EPA's Office of
Water).
However, the agencies still varied in the extent to which the
transparency requirements in Executive Order 12866 were satisfied.
Where the requirements were applicable, the agencies clearly identified
the substantive changes made between the draft submitted for review and
the action subsequently announced in only about 45 percent of the
rules. The agencies clearly identified the changes made at OIRA's
suggestion or recommendation in about 62 percent of these rules. FAA
had no such documentation available, and OSHA said it did not keep the
information in its docket to ensure that it is not part of the official
rulemaking record if a lawsuit is filed. Other agencies had copies of
e-mails between them and OIRA discussing changes that had been made to
the rules, but we could not tell whether these e-mails represented all
or just some of the changes that had been made.
Also, several aspects of the OIRA review process remain unclear, and
could be improved to better allow the public to understand the effects
of OIRA's reviews. For example:
* There is no requirement that either OIRA or the agencies explain why
rules are withdrawn before OIRA completes its review.
* Although the executive order requires OIRA to disclose its contacts
with outside parties regarding rules under review, the information that
OIRA provides in its publicly available meeting log often does not
allow the public to know what rule is being discussed or what parties
were represented.
* The executive order requires OIRA to disclose "all documents
exchanged" between the office and the rulemaking agency during the
review, but OIRA said it would not do so regarding exchanges between
the agencies and OIRA staff at the level where most such exchanges
occur.
* The "consistent with change" category in OIRA's public database does
not indicate whether the changes made to agencies' rules during the
formal review process had been suggested by OIRA or the agencies, or
whether the changes were substantive or editorial in nature.
* The agencies differed considerably regarding what types of changes
made to their rules were "substantive" and therefore needed to be
documented. For example, documentation for some rules included changes
made to both the regulatory text and the agencies' explanations of
their rules, while other documentation only included changes to the
regulatory text.
* OIRA said informal submission of a draft rule for review triggers the
office's disclosure requirements regarding its contacts with outside
parties, but OIRA representatives said it does not trigger the
requirements that the office and the rulemaking agency disclose the
changes made during the review--even though OIRA has said it can have a
significant influence on agencies' draft rules during this informal
review period. OIRA indicated that the transparency requirements only
apply to the formal review period--which can be as short as 1 day--even
though OIRA may have been reviewing substantive drafts of agencies'
rule weeks or even months in advance of the formal review period.
In some cases, the agencies or OIRA included materials in their files
(e.g., substantive changes made during OIRA's informal review) that,
while not required by the executive order as interpreted by OIRA,
provided valuable insights regarding OIRA's effect on the development
of those rules. Although OIRA indicated that disclosure of substantive
changes made to agencies rules during informal review could have a
"chilling effect" on OIRA-agency interactions, we saw no evidence of
that effect in those instances where the substantive changes were
already being disclosed. However, we recognize that OIRA and the
agencies should be able to discuss regulatory matters in general
without having to document and disclose those communications.
Recommendations for Executive Action:
We recommend that the Director of the Office of Management and Budget:
* Define the transparency requirements applicable to the agencies and
OIRA in section 6 of Executive Order 12866 in such a way that they
include not only the formal review period, but also the informal review
period when OIRA says it can have its most important impact on
agencies' rules. Doing so would make the trigger for the transparency
requirements applicable to OIRA's and the agencies' interaction
consistent with the trigger for the transparency requirements
applicable to OIRA regarding its communications with outside parties.
* Change OIRA's database to clearly differentiate within the
"consistent with change" outcome category which rules were
substantively changed at OIRA's suggestion or recommendation and which
were changed in other ways and for other reasons.
* Improve the implementation of the transparency requirements in the
executive order that are applicable to OIRA. Specifically, the
Administrator should take the following actions:
* More clearly indicate in the meeting log which regulatory action was
being discussed and the affiliations of the participants in those
meetings.
* Because most of the documents that are exchanged while rules are
under review at OIRA are exchanged between agency staff and OIRA desk
officers, OIRA should reexamine its current policy that only documents
exchanged by OIRA branch chiefs and above need to be disclosed.
* Establish procedures whereby either OIRA or the agencies disclose the
reasons why rules are withdrawn from OIRA review.
* Improve the implementation of the transparency requirements in the
executive order that are applicable to rulemaking agencies.
Specifically, the Administrator should take the following actions:
* Define the types of "substantive" changes during the OIRA review
process that agencies should disclose as including not only changes
made to the regulatory text but also other, noneditorial changes that
could ultimately affect the rules' application (e.g., explanations
supporting the choice of one alternative over another and solicitations
of comments on the estimated benefits and costs of regulatory options).
* Instruct agencies to put information about changes made in a rule
after submission for OIRA's review and those made at OIRA's suggestion
or recommendation in the agencies' public rulemaking dockets, and to do
so within a reasonable period after the rules have been published.
* Encourage agencies to use "best practice" methods of documentation
that clearly describe those changes (e.g., like those used by FDA,
EPA's Office of Water, or FMCSA).
Agency Comments and Our Evaluation:
On August 8, 2003, we provided a draft of this report to the Director
of the Office of Management and Budget for his review and comment. On
September 2, 2003, the Administrator of OIRA provided written comments
on the draft report. (See app. V for a copy of these comments.) The
Administrator said OIRA believed the "factual foundations of the report
are well grounded," and was pleased that the report noted improvements
in the timeliness of OIRA's reviews and the transparency of the review
process. He indicated that OIRA agreed with our recommendation to
improve the clarity of the office's meeting log, but said OIRA did not
agree with all of the recommendations in the draft report. He said the
report had not demonstrated the need or desirability of changing the
agency's existing "unprecedented" level of transparency, and cited
several specific examples. However, we continue to believe that
improvements can and should be made to improve the transparency of the
OIRA review process. The difficulties that we experienced during this
review clearly demonstrated that OIRA's reviews are not always
transparent to the public. (See chapter 5 for a fuller description of
OMB's comments and our evaluation.):
[End of section]
Chapter 1:
Introduction:
Federal regulation, like taxing and spending, is one of the basic tools
of government used to implement public policy. Regulations generally
start with an act of Congress and are the means by which statutes are
enacted in specific requirements are established. Federal agencies
issue more than 4,000 regulatory actions each year on topics ranging
from the timing of bridge openings to the permissible levels of
contaminants in drinking water. The costs and benefits associated with
all federal regulations has been a subject of great controversy, with
the costs estimated in the hundreds of billions of dollars and the
benefits estimates even higher. During the past 50 to 60 years,
Congress and various presidents have developed an elaborate set of
procedures and requirements to guide the federal rulemaking process.
One of the most important yet least understood of these requirements is
the provision that federal agencies (other than independent regulatory
agencies) submit their draft rules to the Office of Information and
Regulatory Affairs (OIRA) within the Office of Management and Budget
(OMB) for review before being published in the Federal Register.
Although a relatively small office (about 55 full-time equivalent or
"FTE" positions), OIRA reviews can have a significant--if not
determinative--effect on federal rulemaking and, therefore, public
policy.
Because OIRA's regulatory review function is not well understood, the
Ranking Minority Members of the Senate Committee on Governmental
Affairs and its Subcommittee on Oversight of Government Management, the
Federal Workforce, and the District of Columbia requested that we
examine and report on certain aspects of its operation. Specifically,
they requested that we (1) describe OIRA's current regulatory review
policies and processes and determine whether, and if so how, those
policies have changed in recent years, (2) provide information about
health, safety, and environmental rules from nine selected agencies
that were returned to the agencies for reconsideration, withdrawn at
OIRA's request, or significantly changed in response to OIRA's reviews
during a 1-year period, and (3) describe how OIRA determined that
certain existing rules listed in its reports to Congress on the costs
and benefits of federal regulations merited high priority review for
potential modification or rescission.
Background:
OMB is part of the Executive Office of the President, along with such
agencies as the Council of Economic Advisors (CEA), the Council on
Environmental Quality, and the Office of Science and Technology Policy.
These agencies help develop and implement the policies and programs of
the President. As figure 1 shows, OIRA is one of the statutory offices
within OMB--which are sometimes collectively referred to as the
"management" side of OMB. Other OMB offices include the resource
management offices, which review agencies' budget submissions and are
sometimes collectively referred to as OMB's "budget" side.[Footnote 7]
Figure 1: OIRA Is One of the Statutory Offices within OMB:
[See PDF for image]
[End of figure]
The Administrator of OIRA is appointed by the President, subject to the
advice and consent of the Senate. As figure 2 illustrates, OIRA
currently has four branches: (1) Information Policy and Technology, (2)
Statistical and Science Policy, (3) Health, Transportation, and General
Government, and (4) Natural Resources, Energy, and Agriculture. Of
these, the last two branches are primarily responsible for reviewing
agencies' draft proposed and final regulations under Executive Order
12866. However, as discussed later in this report, the other branches
as well as other parts of OMB and the Executive Office of the President
may be consulted during their reviews.
Figure 2: Organization of OIRA:
[See PDF for image]
[End of figure]
The Rulemaking Process and Presidential Review:
The basic process by which federal agencies develop and issue
regulations is spelled out in the Administrative Procedure Act of 1946,
as amended (APA), codified at 5 U.S.C. section 553. Among other things,
the APA generally requires agencies to (1) publish a notice of proposed
rulemaking in the Federal Register, (2) allow interested persons an
opportunity to participate in the rulemaking process by providing
"written data, views, or arguments," and (3) publish the final rule 30
days before it becomes effective. However, the APA allows agencies to
issue final rules without a previous notice of proposed rulemaking in
certain cases.[Footnote 8]
The Paperwork Reduction Act (PRA) of 1980 established OIRA to provide
central agency leadership and oversight of governmentwide efforts to
reduce unnecessary paperwork burden and improve the management of
information resources. Specifically, the act required OIRA to review
and approve agencies' proposed collections of information before the
agencies could collect information from the public. In recent years,
OIRA has reviewed between 3,000 and 5,000 proposed collections of
information each year under the PRA. Although many federal regulations
have an information collection component, the PRA did not specifically
authorize OIRA to review or comment on the substance of those
regulations.
Nevertheless, centralized review of agencies' regulations within the
Executive Office of the President has been part of the rulemaking
process for more than 30 years. For example:
* In 1971, President Nixon established a "Quality of Life Review"
program in which agencies submitted all significant draft proposed and
final rules to OMB, which then circulated them to other agencies for
comment. In their submissions, agencies provided a summary of their
proposals, a description of the alternatives that they considered, and
the cost of those alternatives.
* In 1974, President Ford issued Executive Order 11821, which required
agencies to prepare an "inflation impact statement" for each "major"
proposed rule before publication in the Federal Register, and to send a
summary of those statements to the Council on Wage and Price Stability
when the rule was published. The council would then review the
statement and either provide comments to the agency or participate in
the comment process.
* In 1978, President Carter issued Executive Order 12044, which (among
other things) required agencies to publish semiannual agendas of any
significant rules under development and to prepare a regulatory
analysis that examined the cost-effectiveness (i.e., the least cost of
achieving the objective) of alternative regulatory approaches for major
rules. President Carter also established (1) a "regulatory analysis
review group" to review the analyses prepared for certain major rules
and to submit comments during the comment period, and (2) a "regulatory
council" to coordinate agencies' actions to avoid conflicting
requirements and duplication of effort.
Perhaps the most significant development in this evolution of
presidential review of rulemaking occurred in 1981 when President
Reagan issued
Executive Order 12291.[Footnote 9] The executive order replaced
Executive Order 12044 and established a set of general requirements for
rulemaking--e.g., that (to the extent permitted by law) (1) the
potential benefits of a regulatory action must outweigh the potential
costs to society, (2) regulatory objectives should maximize net
benefits to society, and (3) agencies should select the regulatory
alternative involving the least net cost to society. The order also
required federal agencies (other than independent regulatory agencies)
to send a copy of each draft proposed and final rule to OMB before
publication in the Federal Register. In addition, it required covered
agencies to prepare a regulatory impact analysis for each "major" rule,
and authorized OMB to review "any preliminary or final Regulatory
Impact Analysis, notice of proposed rulemaking, or final rule based on
the requirements of this Order."[Footnote 10] As a result of this
order, OIRA's responsibilities were greatly expanded from paperwork
reviews to examinations of the substance of covered agencies' proposed
and final rules--between 2,000 and 3,000 reviews per year.[Footnote 11]
In 1985, President Reagan extended OIRA's influence even further by
issuing Executive Order 12498, which required nonindependent agencies
to submit a regulatory plan to OMB for review each year that covered
all of their significant regulatory actions underway or planned.
The expansion of OIRA's role in the rulemaking process as a result of
these executive orders was not without controversy. Concerns were
raised by members of Congress, public interest groups, and others
regarding a variety of issues, including whether OIRA's role violated
constitutional separation of powers, and the effect that OIRA's review
had on public participation under the APA and the timeliness of
agencies' rulemaking. (Neither the order nor OIRA guidance placed any
time limits on OIRA's reviews.) Concerns were also raised regarding the
transparency of OIRA's reviews, specifically whether OIRA had become a
clandestine conduit for outside influence in the rulemaking process. In
response to those criticisms, in June 1986, the OIRA Administrator
issued a memorandum for the heads of departments and agencies subject
to the executive orders describing OIRA procedures to improve the
transparency of the process. For example, the memorandum said that only
the Administrator or the Deputy Administrator could communicate with
outside parties regarding rules submitted for review, and that OIRA
would make available to the public all written materials received from
outside parties. OIRA also said that it would, upon written request,
make available all written correspondence between OIRA and the agency
head regarding a draft submitted for review.
In 1987 the National Academy of Public Administration published a
report on presidential management of agency rulemaking that summarized
the criticisms of the OIRA regulatory review effort as well as the
positions of its proponents.[Footnote 12] The report also described a
number of issues in regulatory review and offered recommendations for
improvement. For example, the report recommended that "regulatory
management be accepted as an essential element of presidential
management." It also recommended that regulatory agencies "log,
summarize, and include in the rulemaking record all communications from
outside parties, OMB, or other executive or legislative branch
officials concerning the merits of proposed regulations.":
In 1988 the Administrative Conference of the United States also
examined the issue of presidential review of agency rulemaking and
concluded that the reviews could improve coordination and resolve
conflicts among agencies. However, the conference also said
presidential review "does not displace responsibilities placed in the
agency by law nor authorize the use of factors not otherwise permitted
by law." The Conference recommended public disclosure of proposed and
final agency rules submitted to OIRA under the executive order,
communications from OMB relating to the substance of rules, and
communications with outside parties, and also recommended that the
reviews be completed in a "timely fashion."[Footnote 13]
Executive Order 12866:
On September 30, 1993, President Clinton issued Executive Order 12866
on "Regulatory Planning and Review," which revoked Executive Orders
12291 and 12498 and established a new regulatory philosophy and set of
principles, as well as a new process for OIRA review. In its statement
of regulatory philosophy, the executive order states, among other
things, that agencies should assess all costs and benefits of available
regulatory alternatives, including both quantitative and qualitative
measures. It also provides that agencies should select regulatory
approaches that maximize net benefits (unless a statute requires
another approach). Where permissible and applicable, the order states
agencies should adhere to a set of principles, including (1)
consideration of the degree and nature of risk posed when setting
regulatory priorities, (2) adoption of regulations only upon a
"reasoned determination that the benefits of the intended regulation
justify its costs," and (3) tailoring regulations to impose the least
burden on society needed to achieve the regulatory objectives. Some of
the stated objectives of the order are "to reaffirm the primacy of
Federal agencies in the regulatory decision-making process; to restore
the integrity and legitimacy of regulatory review and oversight; and to
make the process more accessible and open to the public." Section 2(b)
of the order assigns responsibility for review of agency rulemaking to
OMB, and specifically names OIRA as "the repository of expertise
concerning regulatory issues." The order also named the Vice President
as principle advisor to the President on regulatory policy, planning,
and review.
Section 6 of Executive Order 12866 established agency and OIRA
responsibilities in the centralized review of regulations. Like its
predecessor, the new executive order limits OIRA reviews to rules
published by agencies other than independent regulatory agencies.
However, in contrast to the broad scope of review under Executive Order
11291, the new order limits OIRA reviews to actions identified by the
rulemaking agency or OIRA as "significant" regulatory actions, which
are defined in section 3(f) of the order as the following:
"Any regulatory action that is likely to result in a rule that may (1)
have an annual effect on the economy of $100 million or more or
adversely affect in a material way the economy, a sector of the
economy, productivity, competition, jobs, the environment, public
health or safety, or State, local, or tribal governments or
communities; (2) create a serious inconsistency or otherwise interfere
with an action taken or planned by another agency; (3) materially alter
the budgetary impact of entitlements, grants, user fees, or loan
programs or the rights and obligations of recipients thereof; or (4)
raise novel legal or policy issues arising out of legal mandates, the
President's priorities, or the principles set forth in the Executive
order.":
As figure 3 shows, by focusing OIRA's reviews on significant rules, the
number of draft proposed and final rules that OIRA examined fell from
between 2,000 and 3,000 per year under the Executive Order 12291 to
between 500 and 700 rules per year under Executive Order 12866.
Figure 3: Number of Rules That OIRA Reviewed Dropped Under Executive
Order 12866:
[See PDF for image]
[End of figure]
Executive Order 12866 also differs from its predecessor in other
respects. For example, the order required that OIRA generally complete
its review of proposed and final rules within 90 calendar days. It also
requires both the agencies and OIRA to disclose certain information
about how the regulatory reviews were conducted. For example, agencies
are required to identify for the public (1) the substantive changes
made to rules between the draft submitted to OIRA for review and the
action subsequently announced and (2) changes made at the suggestion or
recommendation of OIRA. OIRA is required to provide agencies with a
copy of all written communications between OIRA personnel and parties
outside of the executive branch, and a list of the dates and names of
individuals involved in substantive oral communications. OIRA is also
instructed to maintain a
public log of all regulatory actions under review and of all of the
above-mentioned documents provided to the agencies.[Footnote 14]
In October 1993, the OIRA Administrator issued guidance to the heads of
executive department and agencies regarding the implementation of
Executive Order 12866. The section of that guidance on "Openness and
Public Accountability" that discussed the order's transparency
requirements indicated that the requirement that agencies identify for
the public the changes made at the suggestion or recommendation of OIRA
only applies to changes made after draft rules are formally submitted
to OIRA for review. In January 1996, OIRA published a document that
described "best practices" for preparing the economic analysis of
significant regulatory actions called for by the executive order. This
document was revised and issued as guidance in 2000, and is described
in greater detail in chapter 2 of this report.
Prior Report on Transparency Requirements:
In January 1998, we reported on the implementation of some of the
transparency requirements in Executive Order 12866 within selected
agencies.[Footnote 15] We concluded that the agencies had complete
documentation of changes made during OIRA's review for only about 26
percent of the 122 regulatory actions that we reviewed. The agencies
had complete documentation of the changes that OIRA suggested or
recommended for only about 24 percent of the rules. In other cases the
agencies had some documentation that changes had been made, but it was
not clear whether all such changes had been documented. In addition,
the documentation that we were able to locate was sometimes not
available to the public or hard to find. In our report, we recommended
that OIRA provide agencies with guidance on how to implement the
transparency requirements in the executive order. Specifically, we said
the guidance should require the agencies to include a single document
in the public rulemaking docket for each regulatory action that (1)
identified all substantive changes made during OIRA's review and at the
suggestion or recommendation of OIRA or (2) states that no changes were
made.[Footnote 16] We also said that the guidance should point to best
practices in some agencies to suggest how other agencies could organize
their dockets to best facilitate public access and disclosure. OIRA
disagreed with our recommendations and did not implement them.
Objectives, Scope, and Methodology:
The overall objective of this assignment was to determine how OIRA
conducts its regulatory reviews. The requesters indicated that little
was known about those reviews, the effects that outside parties have on
OIRA decision making, or the impact of OIRA decisions on the American
public. Our specific objectives were the following:
* Describe OIRA's current regulatory review policies and processes and
determine whether, and if so how, those policies and processes have
changed in recent years.
* Identify the rules issued by selected agencies that were reviewed by
OIRA between July 1, 2001, through June 30, 2002, and that were either
significantly changed at OIRA's direction, returned by OIRA for further
consideration by the agencies, or withdrawn by the agencies at OIRA's
suggestion. For each such rule, (a) describe the changes made by OIRA,
the reasons why the rule was returned or withdrawn, and any subsequent
activity regarding the rule, (b) describe, to the extent possible, the
effects of the changes, returns, and withdrawals on the rule's original
benefits and costs, and (c) determine whether there are any indications
that the actions OIRA took were traceable to suggestions offered by
regulated entities or outside parties and, if so, whether OIRA publicly
disclosed their involvement. We also examined OIRA's and the agencies'
application of the transparency requirements in the executive order and
related guidance.
* Describe how OIRA determined that certain existing rules listed in
its reports to Congress on the costs and benefits of federal
regulations merited high priority review. Specifically, determine (a)
which organizations or persons suggested that these rules be reviewed,
(b) what process OIRA used to select and prioritize the rules, (c) the
extent to which OIRA publicly disclosed its selection and priority-
setting process, and (d) the current status of those rules.
A detailed discussion of our methodology and scope limitations is
provided in appendix I. In brief, we defined OIRA's "current"
regulatory review policies and processes as those in place as of June
2002 or later. To describe those policies and processes and any changes
in recent years, we reviewed relevant documents (e.g., executive
orders, legislation, and OMB guidance) and interviewed current OIRA and
agency staff, two former OIRA Administrators, and knowledgeable
officials and staff from external groups that are actively involved in
observing and commenting on the federal regulatory process.
We focused our efforts in the second objective on those rules submitted
for OIRA review that met the following criteria: (a) the rule was
submitted to OIRA as a proposed, interim final, or final rule, (b) OMB
completed its review of the rule between July 1, 2001, and June 30,
2002, (c) the rule was returned to the rulemaking agency by OIRA,
withdrawn from OIRA's review by the agency, or changed after submission
for OIRA's review, and (d) it was included among the set of health,
safety, or environmental rules from those agencies or subagencies that
OIRA's Executive Order Review database indicated had five or more rules
returned, withdrawn, or changed during the period in scope for this
objective. A total of 85 rules from nine agencies--the Animal Plant and
Health Inspection Service (APHIS); Food and Drug Administration (FDA);
Occupational Safety and Health Administration (OSHA); Department of
Transportation's (DOT) Federal Aviation Administration (FAA); Federal
Motor Carrier Safety Administration (FMCSA); and National Highway
Traffic Safety Administration (NHTSA); and the Environmental Protection
Agency's (EPA) Office of Air and Radiation, Office of Solid Waste and
Emergency Response, and Office of Water--met these criteria.[Footnote
17] We also reviewed documents in both agencies' and OIRA's rulemaking
dockets, and interviewed OIRA and agency officials to obtain
information about the regulatory review process for the individual
rules included in our scope.
Our work to address the third objective focused on the particular rules
identified for high priority review in the 2001 and 2002 versions of
OMB's annual report to Congress on the costs and benefits of federal
regulations. We reviewed any available documentation describing the
process that OIRA used to select certain rules for high priority
review. We also interviewed OIRA representatives and representatives of
other relevant agencies and organizations to determine how the
classifications were made and why the particular selected rules were
designated as high priority.
The specific limitations to our engagement are identified with each of
our findings. In general, our findings were sometimes limited to the
documentation that was available. Some types of OIRA's influence on
rules may not be reflected in the documentation we relied on in this
review. For example, in a previous review DOT officials told us that
they will not even propose certain regulatory provisions because they
know that OIRA will not find them acceptable.[Footnote 18] Also, we
cannot be sure that we have identified all changes to the selected
rules that were made at the direction or suggestion of OIRA (e.g.,
changes made during informal OIRA reviews that were not documented),
nor can we be sure that we identified all the effects of such changes
on the rules or all instances in which an outside party may have
influenced OIRA's actions. We conducted our review from July 2002
through May 2003 at the headquarters offices of the above-mentioned
agencies in accordance with generally accepted government auditing
standards. We verified data elements that we used from OIRA's database
and found only minor differences between that database and information
in OIRA's and agencies' files. Therefore, we concluded that the data
were sufficiently reliable for purposes of our report. We provided a
draft of this report to OMB for comment. The comments that we received,
and our evaluation of those comments, are reflected in the "Agency
Comments and Our Evaluation" section of chapter 5 of this report.
[End of section]
Chapter 2: Some of OIRA's Regulatory Review Policies Have Changed:
Our first objective was to describe OIRA's current regulatory review
policies and processes and determine whether, and if so how, those
policies and processes have changed in recent years. We determined that
OIRA's formal regulatory review process under Executive Order 12866
sometimes also includes informal reviews before the official submission
of draft rules by the agencies. Both types of reviews focus on the
draft rules' adherence to applicable laws, executive orders, guidance
documents, and the President's policies. The OIRA review process is
essentially unchanged since the office began reviewing rules in 1981.
The most significant changes occurred in 1993 with the issuance of
Executive Order 12866. However, there have been several other changes
in policies and emphasis in recent years, particularly since the
current OIRA Administrator took office in July 2001. Those changes
include increased use of return letters and the advent of "prompt"
letters, increased emphasis on benefit-cost analysis and peer review,
stricter adherence to the 90-day period for OIRA review, improvements
in the transparency of the OIRA review process, and an increase in the
size and skills of OIRA staff. However, some of these changes are not
as significant a departure from previous practice as they initially
appear. Underlying many of these changes is a shift in how the
Administrator views OIRA's role in the regulatory process.
OIRA Regulatory Review Process:
As noted in chapter 1 of this report, Executive Order 12866 limits
OIRA's regulatory reviews to significant rules that are initiated by
agencies other than independent regulatory agencies.[Footnote 19] The
executive order also establishes certain requirements regarding how
those reviews are conducted (e.g., generally requiring the reviews to
be completed within 90 calendar days after the rule is submitted to
OIRA). Although the overall process that OIRA uses to review covered
agencies' draft rules is described in the executive order or other OIRA
publications, the specific details about how the office conducts its
reviews are not well understood. One rulemaking agency official
described the review process to us as a "black box" into which agencies
submit rules that later come out intact, changed, withdrawn, or
returned.
As figure 4 shows, OIRA reviews agencies' draft rules at both the
proposed and final stages of rulemaking.[Footnote 20] In each phase,
the rulemaking agency formally submits a regulatory review package to
OIRA (consisting of the rule, any supporting materials, and a
transmittal form) and OIRA initiates a review. During the review
process, OIRA analyzes the draft rule in light of the principles of
Executive Order 12866, and discusses the package with staff and
officials at the rulemaking agency, and, if the occasion warrants, with
other agencies with whom interagency coordination will be necessary. In
the course of that process, the draft rule that is submitted by the
agency often changes. In some cases, agencies withdraw the draft rule
from OIRA during the review period and the rule may or may not be
subsequently resubmitted to OIRA.
Figure 4: The OIRA Regulatory Review Process:
[See PDF for image]
[End of figure]
At the end of the review period, OIRA either concludes that the draft
rule is consistent with the principles of the executive order (which
occurs in the vast majority of cases) or returns the rule to the agency
"for further consideration."[Footnote 21] If a draft rule that was
determined to be consistent with the executive order had been modified
in the course of the review, the rule is coded in the OIRA database as
"consistent with change" (regardless of the source or extent of the
change). If no changes have been made to the draft rule during the
review, the rule is coded as "consistent without change." OIRA only
codes rules as "consistent with no change" if they are exactly the same
at the end of the review period as the original submission. Even
editorial changes made at the rulemaking agency's initiative can cause
a rule to be coded "consistent with change.":
If the draft is a proposed rule, upon completion of OIRA's review the
agency may then publish a notice of proposed rulemaking and, in
accordance with the APA, obtain comments during the specified period
(usually at least 30 days), review the comments received, and make any
changes to the rule that it believes are necessary to respond to those
comments. If the draft is a final rule, the agency may publish the
final rule after OIRA concludes its review and the rule will take
effect either at that point or at some later date specified by the
agency. OIRA representatives emphasized that the office does not
"approve" or "disapprove" draft rules. They noted that the rulemaking
agency has been vested with authority by Congress to issue regulations,
and said OIRA's review of draft rules under Executive Order 12866 does
not displace that authority. They said any changes that are made to
draft rules as a result of that review are made by the rulemaking
agency, not OIRA.
Figure 4 also illustrates that for some rules there are two distinct
phases of OIRA's review: (1) a formal review period after the rule is
officially submitted to OIRA and (2) an informal review period before
submission of the rule.
Formal Review:
According to OIRA representatives, the formal regulatory review process
begins when the rulemaking agency sends the draft rule to the OIRA
docket librarian (either electronically or hand carried), who logs the
receipt of the rule and forwards it to the appropriate desk officer.
The representatives said that OIRA desk officers do not use a standard
"checklist" to review agencies' rules, but indicated that most reviews
are similar in certain respects. Section 6 of Executive Order 12866
states that the OIRA Administrator is to provide meaningful guidance
and oversight "so that each agency's regulatory actions are consistent
with applicable law, the President's priorities, and the principles set
forth in this Executive order, and do not conflict with the policies or
actions of another agency." The laws applicable to specific regulations
vary, but always include the specific statutory authority under which
each regulation is being developed (e.g., the Clean Air Act or the
Occupational Safety and Health Act) as well as a variety of
crosscutting regulatory statutes (e.g., the APA and the Regulatory
Flexibility Act).
The principles in Executive Order 12866 that are intended to guide
covered agencies' rulemaking practices (and therefore guide OIRA's
review practices as well) include the following:
* Identify and assess available alternatives to direct regulation;
* design regulations in the most cost-effective manner to achieve the
regulatory objective;
* assess both the costs and benefits of the intended regulation, and
propose or adopt a regulation only upon a reasoned determination that
the benefits of the intended regulation justify its costs;
* base decisions on the best reasonably obtainable scientific,
technical, economic, and other information;
* identify and assess alternative forms of regulation; and:
* tailor regulations to impose the least burden on society.
In addition, the executive order's "regulatory philosophy" provides
that "in deciding whether and how to regulate, agencies should assess
all costs and benefits of available regulatory alternatives, including
the alternative of not regulating." It goes on to state that, unless a
statute requires another regulatory approach, "in choosing among
alternative regulatory approaches, agencies should select those
approaches that maximize net benefits.":
The type of review that OIRA conducts sometimes depends on the type of
draft rule submitted. For example, if the draft rule contains a
collection of information covered by the Paperwork Reduction Act, OIRA
representatives said that the desk officer would also review it for
compliance with the act. (They indicated that conducting both reviews
simultaneously can be more difficult if different offices within the
rulemaking agencies are responsible for the rule and the information
collection.) If the draft rule is "economically significant" (e.g., has
an annual impact on the economy of at least $100 million), the
executive order requires agencies to prepare an economic analysis
describing, among other things, the alternatives that the agency
considered and the costs and benefits of those alternatives. For those
economically significant rules, the desk officers review the economic
analyses using the "best practices" document developed in January 1996
and the related guidance document issued in 2000. (These documents are
described in more detail later in this report.):
In addition to Executive Order 12866, there are several memoranda and
guidance documents from OMB and/or the OIRA Administrator that provide
additional details regarding the content of OIRA's regulatory reviews.
For example, on September 20, 2001, the OIRA Administrator sent a
memorandum to the President's Management Council on "Presidential
Review of Agency Rulemaking by OIRA." An attachment to the memorandum
described "the general principles and procedures that will be applied
by OMB in the implementation of E.O. 12866 and related statutory and
executive authority." For example, the attachment indicated that the
office would, where appropriate, (1) include an evaluation of whether
the agency has, in assessing exposure to a risk or environmental
hazard, conducted an adequate risk assessment, (2) give "a measure of
deference" to regulatory impact analyses and other supporting technical
documents that have been peer reviewed in accordance with specified
procedures,[Footnote 22] (3) ensure that regulatory clearance packages
satisfy the requirements in other executive orders (e.g., include the
certifications required by Executive Order 13132 on "Federalism" and
Executive Order 13175 on "Consultation and Coordination with Indian
Tribal Governments"), (4) consult with the Small Business
Administration (SBA) and the SBA Chief Counsel for Advocacy, and (5)
evaluate the possible impact of the draft rule on the programs of other
federal agencies. (Several of these elements are discussed more fully
later in this chapter, including OMB's guidance on economic analysis.):
OIRA representatives said that there is usually some type of
communication (often via e-mail or telephone) between the desk officer
and the rulemaking agency regarding specific issues in the draft rule.
The representatives said briefings and meetings are sometimes held
between OIRA and the agency during the review process, with branch
chiefs, the Deputy Administrator, and/or the Administrator involved in
some of these meetings.[Footnote 23] They also said that the desk
officers always consult with the resource management officers on the
budget side of OMB as part of their reviews, and reviews of draft rules
are not completed until those resource management officers sign off.
(In fact, they said that the resource management offices might take the
lead in the review for rules involving the "transfer" of federal funds
within society.) If the draft rule is economically significant, they
said the desk officer would also consult with an economist to help
review the required economic analysis. For other rules the OIRA
representatives said the desk officer might consult with other OIRA
staff on issues involving statistics and surveys, information
technology and systems, or privacy issues. In certain cases, OIRA may
circulate a draft rule to other parts of the Executive Office of the
President (e.g., the Office of Science and Technology Policy or the
Council on Environmental Quality) or other agencies (e.g. SBA for rules
having an impact on small businesses, or DOE, DOT, the Department of
Agriculture, and the Department of the Interior for certain EPA rules).
In those cases, OIRA may not only review the rule itself, but also
manage an interagency review process.
Executive Order 12866 generally requires OIRA to complete its
regulatory reviews within certain time frames--(1) within 10 working
days of submission for any preliminary actions prior to a notice of
proposed rulemaking (e.g., a notice of inquiry or an advance notice of
proposed rulemaking) or (2) within 90 calendar days of submission for
all other regulatory actions (or 45 days if OIRA had previously
reviewed the material and there had been no material changes in the
facts or circumstances upon which the regulatory action was based). At
the conclusion of its review, they said OIRA notifies the issuing
agency by telephone. At that point, the agency may publish the rule in
the Federal Register.
As noted previously, a draft rule that has been reviewed and judged
consistent with the executive order may be coded in the office's
database as "consistent with no change" (meaning that OIRA considered
the draft rule as submitted to be consistent with all applicable
requirements) or "consistent with change" (which means that the draft
rule was changed at either the issuing agency's initiation or at the
suggestion of OIRA, and that OIRA then considered the changed rule to
be consistent with all applicable requirements). If the rule is
returned to the issuing agency for reconsideration, the executive order
requires OIRA to provide a written explanation for the return. Section
7 of Executive Order 12866 originally required the President or the
Vice President to resolve any disagreements or conflicts between or
among agency heads or between OMB and any agency that cannot be
resolved by the OIRA Administrator. However, in February 2002,
Executive Order 13258 reassigned the Vice President's responsibilities
in this area to the President's chief of staff.
Executive Order 12866 also requires OIRA to take certain actions to
ensure greater openness, accessibility, and accountability in the
regulatory review process. For example, the order says that a
representative from the agency issuing the regulation must be invited
to any meeting between OIRA personnel and persons not employed by the
executive branch of the federal government regarding a rule under
executive order review.[Footnote 24] It also requires OIRA to forward
to the issuing agency within 10 working days any written communications
between such outside contacts and OIRA personnel, as well as the dates
and names of such outside contacts involved in substantive oral
communications with OIRA staff. Other requirements include public
disclosure of such written and oral communications, and the maintenance
of a publicly available log containing, among other things, the status
of all regulatory actions. After the regulatory action has been
published in the Federal Register or otherwise issued (or after the
agency announces it will not publish or issue the action), the
executive order requires OIRA to make available to the public "all
documents exchanged between OIRA and the agency during the review." The
executive order established other transparency requirements for
rulemaking agencies (e.g., requiring them to identify substantive
changes made to draft rules during OIRA's review and at the suggestion
or recommendation of OIRA).
Informal Review:
In its December 2001 report on the costs and benefits of federal
regulations, OIRA stated that the office's original review process "was
designed as an end-of-the-pipeline check against poorly conceived
regulations."[Footnote 25] However, OIRA also stated that by the time
an agency formally submits a rule to OIRA for review there may be
"strong institutional momentum" behind the proposal and, as a result,
the agency may be reluctant to address certain issues that OIRA
analysts might raise. Therefore, OIRA indicated "there is value in
promoting a role for OIRA's analytic perspective earlier in the
process, before the agency becomes too entrenched." OIRA went on to
state the following:
"A common yet informal practice is for agencies to share preliminary
drafts of rules and/or analyses with OIRA desk officers prior to final
decision making at the agency. This practice is useful for agencies
since they have the opportunity to educate OIRA desk officers in a more
patient way, before the formal 90-day review clock at OMB begins to
tick. The practice is also useful for OIRA analysts because they have
the opportunity to flag serious problems early enough to facilitate
correction before the agency's position is irreversible.":
However, because of its size, OIRA cannot informally review each of the
hundreds of significant proposed and final rules that are submitted to
the office each year. OIRA representatives told us that a variety of
factors could trigger informal discussions about a forthcoming rule.
For example, they said informal reviews are sometimes used when there
is a statutory or legal deadline for a rule or when the rule has a
large impact on society and requires discussion with not only OMB but
also other federal agencies. Therefore, they said informal review is
more likely regarding rules issued by certain agencies (e.g., EPA, DOT,
the Department of Agriculture, and the Department of Health and Human
Services) that issue those types of rules. OIRA representatives also
said there is an important distinction between informal consultations
between OIRA and agency staff that may occur at any time and informal
reviews that occur when OIRA is provided a substantive draft of a rule.
There have been some indications that OIRA has increased its use of
informal reviews in recent years. For example, in its March 2002 draft
report to Congress on the costs and benefits of federal regulation,
OIRA said "agencies are beginning to invite OIRA staff into earlier
phases of regulatory development in order to prevent returns late in
the rulemaking process. It is at these early stages where OIRA's
analytic approach can most improve on the quality of regulatory
analyses and the substance of rules." Similarly, the Administrator said
"we are trying to transform OIRA from an end-of-the-pipeline
organization to one that also engages in early promotion of good
policies and prevention of bad ones." He also said "an increasing
number of agencies are becoming more receptive to early discussions
with OMB, at least on highly significant rulemakings." As OIRA noted,
that receptivity may be enhanced by the threat of a returned rule. In
early 2002, the Administrator said OIRA was trying "to create an
incentive for agencies to come to us when they know they have something
that in the final analysis is going to be something we're going to be
looking at carefully. And I think that agencies that wait until the
last minute and then come to us--well, in a sense, they're rolling the
dice."[Footnote 26] Perhaps the clearest manifestation of OIRA's early
involvement in rulemaking occurred in 2002, when OIRA and EPA began
what EPA described as an "unusual collaboration," working closely
together to develop a rule curbing pollution from diesel-powered
nonroad vehicles. EPA also indicated that it would collaborate with
OIRA on the design of an "innovative regulatory analysis" for the rule.
However, OIRA informally consulted with agencies and reviewed agencies'
draft rules before formal submission during previous administrations as
well. For example, in September 1996, the then-OIRA Administrator
testified that her office is sometimes "involved earlier and more
deeply in an agency rulemaking--before the agency has completed all of
its own evaluation and its internal and/or interagency coordination,
and has become invested in its decision." An OIRA representative told
us that informal reviews probably had been conducted since OIRA began
reviewing rules, but became more common when Executive Order 12866 was
adopted in 1993 and OIRA's reviews were focused on "significant" rules.
He said because these more complex rules can take years to develop, it
makes sense for agencies to involve OMB earlier in the process so that
policy disagreements can be discussed before substantial amounts of
staff work is conducted.
Changes in Regulatory Review Policies:
According to OIRA representatives, the process that OIRA uses to review
draft rules has been essentially the same since that process was
established in 1981. OIRA representatives indicated that the review
process had changed less in recent years than the changes that occurred
with the advent of Executive Order 12866 in 1993 (e.g., the focus on
"significant" rules, the 90-day clock, and the transparency
requirements). In presentations before various groups, the OIRA
Administrator has said that the office is "pursuing the agenda of
quality regulation under the terms of the Clinton-Gore executive order,
which we believe—is based on sound principles and procedures.":
However, there have been several subtle yet notable changes in OIRA
policies and practices in recent years--particularly since the current
OIRA Administrator took office in July 2001. In October 2002, the
Administrator said "the changes we are making at OMB in pursuit of
smarter regulation are not headline grabbers: No far-reaching
legislative initiatives, no rhetoric-laden executive orders, and no
campaigns of regulatory relief. Yet we are making some changes that we
believe will have a long-lasting impact on the regulatory state.":
Some of OIRA's review policies and practices that the Administrator and
others have identified as significant changes are clear departures from
the policies evident in previous administrations. However, other recent
OIRA policies and practices are only incrementally different from those
evident in previous administrations or have caveats that must be
recognized in their implementation.
OIRA as Regulatory "Gatekeeper":
Overall, there has been a notable change in how recent Administrators
(and perhaps more generally, how recent administrations) have viewed
OIRA's role in the rulemaking process and its relationships with
rulemaking agencies--in essence, whether OIRA should play a more
collaborative, consultative role in relation to the agencies, or
whether OIRA should take on more of a "gatekeeper" role. This change in
philosophy has implications for virtually all of OIRA's
responsibilities, and may be a precipitating factor for many of the
other changes identified in this section of our report.
Perhaps the clearest indications of this change in philosophy are in
the public statements of recent Administrators. For example, in a May
1994 report to the President on the first 6 months of Executive Order
12866, the Administrator of OIRA at the time said the relationship
between OIRA and the agencies had "vastly improved" and that "rule
writers and rule reviewers were learning to work together as partners
rather than as adversaries." Officials we spoke with in 1996 at both
EPA and DOT confirmed this perception. In testimony before the Senate
Committee on Governmental Affairs in September 1996, the Administrator
said, "we have consciously changed the way we relate to the agencies"
and described that change as a "paradigm shift" from the relationship
during previous administrations. She described OIRA's relationship with
rulemaking agencies as "collegial" and "constructive," and said OIRA
was "not in the business of playing 'gotcha' with them."[Footnote 27]
She cited an article that she said accurately described OIRA's approach
as a "consensual process," and that said OIRA functioned "more as a
counselor during the review process than as an enforcer of the
executive order."[Footnote 28] She also emphasized that this
collaborative approach yielded better results than a more
confrontational OIRA-agency relationship.
Another former OIRA Administrator voiced similar sentiments during our
review. He said that during his and his predecessor's tenure in the
mid-to-late 1990s OIRA acted in a spirit of partnership with agencies
submitting regulations for review. He also said that although agencies
were not allowed to do whatever they wanted, OIRA did not dictate how
regulations should be written and worked with the agencies to ensure
transparency and fairness in the rulemaking process.
The current Administrator has characterized OIRA's role and
relationship with the agencies in quite different terms. For example,
in its December 2002 report on the costs and benefits of federal
regulations, OIRA described itself as the "gatekeeper for new
rulemakings."[Footnote 29] In a speech, the current Administrator
described OIRA's regulatory review process as "a form of consumer
protection to protect people from poorly designed rules." He went on to
say that OMB's process of centralized oversight "is a device to
strengthen the hands of scientists, engineers and economists within the
agencies--they now know that regulatory proposals cannot survive OMB
review without careful supporting analysis." He also said OMB review is
a device "to combat the tunnel vision that plagues the thinking of
single-mission regulators." The Administrator has also compared OIRA's
role in reviewing agencies' proposed regulations to OMB's role in
reviewing agencies' budget requests:
"Now, no one would suggest that agencies should be permitted to
negotiate their 'on-budget' resources from Congress, without any OMB
review. Likewise, Presidents realize that regulatory expenditures,
while off budget, require fiscal restraint for the same reasons that
the size of public budgets need to be restrained. If the President
restrains the federal budget without restraining regulation, regulatory
advocates may simply respond by urging Congress to shift regulatory
costs from the federal budget to states and the private sector. In
other words, the President cannot manage the Nation's fiscal health
without managing the regulatory state.":
Comments from both the current and former OIRA Administrators suggest
that the change in the philosophy underlying OIRA's regulatory review
function may be, at least in part, a function of the change in the
presidency that the office serves. A previous Administrator emphasized
that OIRA is part of the Executive Office of the President, and the
President is the office's chief client. Therefore, she said, a change
in the presidency has a profound effect on how OIRA operates. She also
said each new Administrator of OIRA--and ultimately each new
administration--represents a reaction to the previous Administrator and
administration. Just as the Clinton administration's OIRA was a
reaction to the administrations that preceded it, she said the current
Bush administration's OIRA is a reaction to the Clinton period.
Similarly, in March 2002, the current OIRA Administrator said
"Presidents use the powers of OMB regarding agency action to advance
Administration priorities and policy objectives— We should remember
that OMB is an office within the
Executive Office of the President and its actions necessarily reflect
Presidential priorities."[Footnote 30]
Increased Use of Return Letters:
One clear indication of the emergence of OIRA's "gatekeeper" role is
the office's increased use of return letters since 2001. During the
first 7 full calendar years that Executive Order 12866 was in place
(1994 through 2000), OIRA generally reviewed between 500 and 700 rules
each year but returned very few of them to the agencies--three rules in
1995 and four in 1997. (See fig. 5.) However, although the total number
of rules reviewed each year remained about the same, the number of
rules returned to the agencies increased dramatically in 2001. In fact,
OIRA returned almost three times as many rules that year (18 rules)
than in the 7 previous years combined. All of the returns during
calendar year 2001 occurred after the current Administrator took office
in July 2001. In calendar years 2001 and 2002 combined, OIRA returned a
total of 23 rules to the agencies.
Figure 5: OIRA Returned More Rules to Agencies in Calendar Year 2001
Than in the 7 Previous Years Combined:
[See PDF for image]
[End of figure]
DOT had the most rules returned during 2001 and 2002 (eight), followed
by the Social Security Administration (five), the Department of
Veterans Affairs (four), and the Department of Housing and Urban
Development (two). The Department of Agriculture, the Office of
Personnel Management, EPA, and SBA each received one return letter. In
the letters, OIRA commonly said that it returned the rules because of
concerns about the agencies' analytic approach--such as whether the
agency had considered all reasonable regulatory alternatives, or had
selected the alternative that would produce the greatest net benefits.
In its December 2002 report on the costs and benefits of regulations,
OIRA reported that 10 of the 22 rules returned by October 2002 had been
resubmitted and approved for publication.
Recent OIRA Administrators have taken very different positions
regarding the use of return letters, reflecting the philosophical
differences between the administrations in OIRA's relationship with the
agencies and explaining the dramatic change in the use of returns. For
example, two former OIRA Administrators during the previous
administration told us that the objective of the review process was to
achieve an end result that was mutually agreeable, and that they viewed
return letters as evidence of a failure of the collaborative review
process. One of the former Administrators noted that the agencies and
OIRA are parts of the same administration "team," so any public failure
to agree on how a rule should be written could only be seen as a
breakdown of that process.
In contrast, the current OIRA Administrator said in one of his speeches
that the office is using a "carrot and stick" strategy in its efforts
to encourage better regulatory analysis, and that the "stick" has been
the revival of the return letter. In its March 2002 draft report on the
costs and benefits of federal regulations, OIRA noted that no rules had
been returned to the agencies for reconsideration during the previous
administration's final 3 years, and said "the degree of OIRA's actual
effectiveness can be questioned when it declines to use its authority
to return rules." OIRA noted that under the current administration the
office had revived the return letter, "making clear that OMB is serious
about the quality of new rulemakings.":
However, OIRA's increased use of return letters appears to have been
short lived. As figure 6 shows, the sharp increase in the use of return
letters was primarily in the current Administrator's first 8 months in
office (July 2001 through February 2002). During that period, OIRA
returned 21 of the 415 rules that it reviewed to the agencies. More
than half (11) of the 21 rules that OIRA returned during this period
were sent to the agencies in a single month--September 2001. However,
during the following 15-month period (from March 2002 through May
2003), OIRA returned to the agencies only 2 of the 863 rules that it
reviewed--about the same pace as during the previous administration.
Figure 6: OIRA Returned Only Two Rules Between February 2002 and May
2003:
[See PDF for image]
[End of figure]
In its December 2002 report on the costs and benefits of federal
regulations, OIRA indicated that the decline in the number of returns
since February 2002 was a reflection of the improved quality of
regulatory packages. OIRA also said that an even more important factor
was the "earlier interaction between OIRA and agency staffs during
regulatory development in order to prevent returns late in the
rulemaking process. It is at these early stages where OIRA's analytic
approach can most improve the quality of regulatory analyses and the
substance of rules.":
Greater Emphasis on Economic Analysis:
Some of the officials from rulemaking agencies who regularly interact
with OIRA also told us that there is a greater expectation now than
several years ago that the agencies' economic analyses (both benefit-
cost and cost-effectiveness) will be thorough. Officials from one
agency described it as a "more relentless emphasis" on benefit-cost
analysis, and said OIRA is expecting the agencies to devote more money
and effort to refining their analyses to develop rules that are more
cost effective. Officials in another agency said there had been a
perceptible "stepping up the bar" regarding what is expected in
agencies' analyses. They also said that OIRA is looking for greater
quantification of benefits and more justification and breakdown of
marginal benefits of every line item in the agency's rules, and that
OIRA now expects agencies to do a benefit-cost analysis for all
regulatory options, not just for the option that the agency selected.
OIRA representatives pointed out that their office has always pushed
for agencies to do a better job with their analyses. However, they
confirmed that the current Administrator is somewhat more interested in
having the agencies do better analyses than previous Administrators. In
fact, they said the current Administrator said early in his tenure that
he would return a rule if the analysis needed work, even if the rule
itself was acceptable.
Emphasis on 90-day Period for Review:
Another clear change in OIRA regulatory review policy since the current
OIRA Administrator took office has been a stricter adherence to the
time frames for OIRA review. As mentioned earlier in this report,
Executive Order 12866 generally requires OIRA to complete its
regulatory reviews within 90 calendar days of submission for all draft
proposed and final rules. The executive order allows the review period
to be extended once upon the written permission of the OMB Director and
at the request of the rulemaking agency.[Footnote 31] According to a
former OIRA Administrator, the 90-day time limit in the executive order
was put in place because of "strident complaints" about the length of
reviews during the previous administrations' implementation of
Executive Order 12291 in the 1980's and early 1990's. However, she said
the time limit created an unintended "perverse incentive" for the
agencies to respond to OMB suggestions late in the 90-day period, and
then suggest that the rule be approved because of the time limit. As a
result, she said, review periods were often extended beyond the 90-day
limit.
As figure 7 indicates, during each of the calendar years 1999, 2000,
and 2001, more than 100 OIRA reviews exceeded the 90-day limit (115,
159, and 149, respectively). However, during calendar year 2002 (the
current Administrator's first full year in office) only 9 reviews
lasted longer than 90 days. According to an OIRA representative,
virtually all of the extensions of the review periods in each of these
4 years were done at the request of the agency issuing the rule.
(However, officials from one agency and a previous OIRA Administrator
told us that OIRA sometimes asked the agency to request an extension.):
Figure 7: The Number of OIRA Reviews Lasting More Than 90 Days Dropped
Sharply in 2002:
[See PDF for image]
[End of figure]
The dramatic decline in the number of reviews lasting more than 90 days
is traceable to clear differences in philosophy between Administrators
regarding the importance of this requirement. For example, in September
1997 the OIRA Administrator at the time testified that "when two or
more agencies are at loggerheads over a regulatory issue, it may well
take more than 90, or even 120, days to obtain needed data and
analyses, to conduct the appropriate evaluation, and to arrange for the
policy officials in the interested agencies to come to agreement." For
that and other reasons she opposed draft legislation that would have
imposed a statutory time limit on OIRA reviews. Another OIRA
Administrator during the previous administration told us during our
review that he considered it more important to "get the rule right"
rather than rigidly adhere to a 90-day time limitation. Several of the
agency officials that we contacted during this review confirmed that
view, saying that during the previous administration OIRA often worked
with the agencies after the 90-day deadline had passed in order to
resolve comments or questions. In contrast, in May 2002 the current
OIRA Administrator said "agencies have sometimes been forced to wait 6
months, a year, or even longer to get an answer from OMB. We have
changed that practice. I have instructed my staff that no rule will
stay longer than 90 days at OMB without my personal authorization."
According to OIRA's December 2002 report on the costs and benefits of
regulations, the office now regards the 90-day review limit as "a
performance indicator for a strong regulatory gatekeeper." OIRA
representatives confirmed that close adherence to the 90-day clock is
new, and said that OIRA management tracks all rules that have been
under formal review for more than 60 days. They also said that a
benefit of stricter adherence to the 90-day review limit is that it
forces officials to make decisions sooner, thereby moving the review
along more quickly.
Officials from several rulemaking agencies also told us that OIRA staff
currently seem much more focused on the 90-day clock than during the
previous administration. In fact, concerns about adherence to this
fixed review period might have precipitated some of the return letters
that have been more common during the current administration. For
example, in the September 14, 2001, return letter to DOT, the OIRA
Administrator said "(s)ince the resolution of the concerns will take
some additional time, I am returning the draft final rule on flight
data recorders to the Department for your reconsideration." The return
letters for this rule and for one other rule were sent to the agencies
shortly after the rules' 90-day review periods had ended. An OIRA
representative told us that the 90-day clock may play a role in some
returns, but not always.
Officials in other agencies also said that rules are sometimes returned
or withdrawn at OIRA's request when time is running out on the 90-day
clock and it is recognized that more time is needed to resolve issues
"off the clock" or during a separate 90-day period. Representatives of
OIRA told us they do not request that agencies withdraw rules, and
emphasized that it is the agencies--not OIRA--that ultimately make
withdrawal decisions. They also said agencies sometimes withdraw rules
as a negotiating strategy.
Although an increased emphasis on the 90-day time limit is clearly an
area of change in recent years, the formal review period itself may be
somewhat of an artificial construct if OIRA and the agency had been
substantively discussing the rule and/or exchanging drafts of the rule
before formal submission. For example, on December 10, 2001, EPA
formally submitted a draft rule to OIRA on proposed nonconformance
penalties for heavy-duty diesel engines. OIRA's database indicates that
it completed its review 10 days later on December 20, 2001. However,
public documents indicate that EPA and OIRA met with outside parties in
early October 2001 and mid-November 2001 to discuss the rule, and that
EPA informally submitted a version of the draft rule and its economic
analysis to OIRA in late October 2001--weeks before the 10-day formal
review period began. (See GAO ID 53 in app. II of this report.) OIRA
records indicate that the formal review period for an EPA Clean Water
Act rule in which OIRA made significant changes was even shorter--1
day. (See GAO ID 69 in app. II of this report.):
Use of Prompt Letters:
Another change in OIRA policies and practices has been the development
of a new form of communication with the agencies--the "prompt letter."
In its December 2002 report on the costs and benefits of federal
regulations, OIRA stated that the office had historically been a
reactive force in the regulatory process, responding to proposed and
final rules that were generated by federal agencies. However, the
report went on to say that OIRA had recently begun "taking a more
proactive role in suggesting regulatory priorities for agency
consideration," and the prompt letter is the format by which those
suggestions are brought to the agencies' attention.
By the end of May 2003, OIRA had sent nine prompt letters to regulatory
agencies.[Footnote 32] Several of the initial prompt letters
recommended that the agencies consider taking regulatory actions
regarding particular issues. Notably, the letters did not always
suggest that the agency publish a rule on the issue, sometimes
recognized that the agency had already begun taking action, and
generally left the final decision to the agency regarding what action
to take. For example:
* In September 2001, OIRA sent a letter to the Department of Health and
Human Services suggesting that FDA publish a final rule requiring that
the amount of trans fatty acid present in food be included in a
product's label. However, OIRA said the agency should review the
comments received on its proposed rule and proceed to final rulemaking
"if appropriate.":
* Also in September 2001, OIRA sent a letter to OSHA requesting that
the agency "consider whether promotion of (automatic external heart
defibrillators) should be elevated to a priority." However, OIRA said
it understood that OSHA had limited resources and other constraints,
and was simply asking the agency to consider the matter.
* In December 2001, OIRA sent a letter to DOT encouraging NHTSA to give
greater priority to modifying its frontal occupant protection standard
by establishing a high-speed, frontal offset crash test. OIRA
recognized that the agency had already signaled its intent to move
forward with this standard, and also recognized NHTSA's resource
constraints and other legislative mandates.
* In May 2002, OIRA sent a letter to the Office of Federal Housing
Enterprise Oversight recommending that the office consider developing a
rule strengthening the corporate governance of Fannie Mae and Freddie
Mac, and to require them to make certain public disclosures.
* In May 2003, OIRA sent a letter to the Departments of Agriculture and
Health and Human Services requesting them to "further incorporate the
large body of recent public health evidence linking food consumption
patterns to health and disease" as the departments revise their dietary
guidelines and update the "Food Guide Pyramid." Specifically, OIRA
recommended that the revisions "emphasize the benefits of reducing
foods high in trans fatty acids and increasing consumption of foods
rich in omega-3 fatty acid.":
Other OIRA prompt letters were even less focused on rulemaking or
guidance, instead recommending that the agencies better focus certain
research or programs. For example, in December 2001 OIRA sent a letter
to EPA highlighting "some critical research needs that can help target
environmental-protection investments to the most important sources of
(fine particulate matter) and thereby better inform cost-benefit
studies of future air pollution control policies." OIRA recognized that
EPA already devoted a substantial share of its research budget on
particulate matter, but suggested that the research focus on three
particular issues. Similarly, in February 2003, OIRA sent a letter to
the Department of Energy raising several issues regarding a particular
energy modeling system, and suggested changes in that system that
would, in OIRA's view, better enable the agency to assess the potential
of hybrid-electric and diesel powered vehicles.
In March 2002 the OIRA Administrator said that the prompt letters
issued as of that date "have emerged primarily from discussions with my
professional staff," but encouraged the public to submit ideas for
prompts. In another speech he said the use of prompt letters "enables
OMB to publicly identify areas where agencies might improve regulatory
policies." He also said that prompt letters differ from the more
definitive presidential directive in that the letters represent a
"public request that is intended to stimulate agency and public
deliberation," and emphasized that "final decisions about priorities
remain with the agencies.":
Although OIRA's use of public prompt letters is new, the concept of
OIRA (or, more generally, the President) making regulatory suggestions
to the agencies is not.[Footnote 33] One former OIRA Administrator told
us that every administration has had certain areas of regulatory
emphasis and has communicated those ideas to rulemaking agencies in a
variety of ways. She said that if OIRA wanted the agencies to initiate
rulemaking in a particular area, "we could get the agencies' attention
without using a letter." Similarly, another former OIRA Administrator
said that during his tenure if OIRA thought an agency should regulate
in a particular area, he would call an agency official and talk about
the issue rather than sending a public prompt letter than could
embarrass the agency. Officials in one agency also indicated that these
types of communications had existed previously--albeit not publicly. As
indicated in the following quote from its December 2002 report on the
costs and benefits of federal regulation, OIRA identified the public
nature of the prompt letter as a distinguishing feature:
"An important feature of the prompt letter can be its public nature,
aimed at stimulating agency, public and congressional interest in a
potential regulatory or informational priority. Although prompt letters
could be treated as confidential pre-decisional communications, OIRA
believes that it was wiser to make these prompt letters publicly
available in order to focus congressional and public scrutiny on the
important underlying issues.":
An OIRA branch chief told us that the office still does, on occasion,
call an agency on the telephone and suggest areas for regulation. He
said the strategy used (telephone versus prompt letter) depends on a
variety of circumstances, but noted that prompt letters are more
"transparent" and may have more impact than a telephone call.
Several of the agencies have taken some type of action in response to
the OIRA prompt letters, and other actions were planned. For example,
in December 2001 OSHA issued a technical information bulletin regarding
the use of defibrillators in the workplace. In July 2003, FDA published
a final rule on trans-fatty acids. NHTSA said that it planned to issue
a notice of proposed rulemaking on offset crash testing in 2003.
Post-Review Letters:
In 2001 and 2002, OIRA sent a total of five "post-review letters" to
rulemaking agencies and posted those letters on its Web site. As of May
2003, no post-review letters had been sent since August 2002. OIRA
representatives said that although individual branch chiefs or desk
officers had previously provided staff-level comments to rulemaking
agencies at the conclusion of reviews, the use of a public letter
signed by the Administrator to convey those comments represented a
change in OIRA policy.
In some of the post-review letters, OIRA expressed concerns about the
rulemaking agencies' analyses and the cost-effectiveness of the rules
that were similar in many respects to the concerns that the office had
expressed in the previously mentioned return letters. For example,
after OIRA completed its review of EPA's draft proposed rule on
"Control of Emissions from Nonroad Large Spark-Ignition Engines and
Recreational Engines (Marine and Land-Based)" in September 2001, the
OIRA Administrator sent a letter to EPA noting that he was "concerned
that the regulatory analysis is not sufficient to support a reasoned
determination on the appropriate regulation of these sources."
Specifically, he said that the analysis did not "provide a benefit/cost
analysis integral to the decision-making process" and did not evaluate
any alternatives as required by the Unfunded Mandates Reform Act of
1995 and Executive Order 12866. The Administrator said he expected
improvements to the analysis to be submitted before the final rule was
submitted, and said EPA and OIRA should schedule "quarterly meetings to
review the progress in developing a refined analysis.":
However, in other post-review letters, OIRA expressed other types of
comments. For example:
* In an October 2001 letter regarding an FAA draft proposed rule on
"Traffic Alert and Collision Avoidance Systems," the OIRA Administrator
recognized that despite the rule's high cost compared to its benefits,
the agency had "limited alternatives available under the statute." In
that regard, he indicated that the department and the agency should
share with Congress "any information made available by the public that
bears on the reasonableness of implementing the statute." He also
encouraged FAA to carefully assess the impact of the rule on small
entities and the financial health of the industry "in light of recent
events.":
* In a June 2002 letter regarding a NHTSA final rule on tire pressure
monitoring systems, the OIRA Administrator expressed his appreciation
for the "significant improvements NHTSA made in the regulatory
analysis," and encouraged the agency to conduct a study examining the
relative frequency of different causes of crashes.
* In an August 2002 letter regarding a Department of Housing and Urban
Development rule on improving the process for obtaining mortgages, the
OIRA Administrator encouraged the department to continue its work to
improve and simplify the proposed forms, and suggested that the
department "further strengthen the economic and regulatory flexibility
analyses.":
A former OIRA Administrator told us that the office's current use of
public post-review letters represents a change in policy from the
previous administration. She said that during the previous
administration OIRA might have spoken with an agency about what it
should be doing before a proposed rule was resubmitted, but OIRA would
not have put those comments in writing. She described the previous
process as "non-public post review comments," and said written material
was too confrontational.
Transparency Improvements:
On numerous occasions, the current OIRA Administrator has identified
improvements in the transparency of the office's regulatory review
process as a key area of change, and has described the establishment of
a climate of openness at OIRA as his "first priority." The
Administrator said the information that OIRA discloses about its
reviews is intended to "diminish the culture of secrecy and mystery
that has surrounded my Office since it was launched early in the Reagan
Administration," and said that "more openness at OMB about regulatory
review will enhance public appreciation of the value and legitimacy of
a centralized analytical approach to regulatory policy." He also
described the transparency of OIRA's regulatory review process as
"critical to our ability to improve the nation's regulatory system,"
and said "only if it is clear how the OMB review process works and what
it does will Congress and the public understand our role and the
reasons behind our decisions." He also said "we see openness not simply
as a canon of good government but as a strategy to transform the public
debate about regulation to one of substance—rather than process."
Similarly, in May 2002 the OMB Director said that one way to establish
public confidence in the "consumer protection" mission of OMB is
"maximum openness.":
Disclosure of Contacts with Outside Parties:
In October 2001, the OIRA Administrator sent a memorandum to OIRA staff
(and published it on the office's Web site) that, among other things,
delineated OIRA's disclosure procedures regarding substantive
communications with outside parties (i.e., persons not employed by the
executive branch) while rules were under review. Many of the procedures
listed were the same as or clarifications of the disclosure
requirements in Executive Order 12866. For example, like the executive
order, the memorandum said that (1) only the Administrator or a
particular designee can receive substantive telephone calls from
outside parties, (2) a representative from the issuing agency must be
invited to any meeting between OIRA personnel and outside parties, and
(3) OIRA must send to the regulatory agency all written communications
between OIRA personnel and outside parties within 10 days.
However, the Administrator's October 2001 memorandum also extended the
executive order's disclosure requirements in certain areas. For
example, the memorandum said that OIRA would disclose substantive
telephone calls with outside parties about a rule under review if the
calls are initiated by the Administrator, not just the calls that the
Administrator receives from outside parties. Also, the memorandum said
that OIRA considers a rule to be under review for purposes of OIRA's
disclosure requirements regarding outside parties not just during the
formal review process, but before formal submission of the review
package (i.e., during the previously mentioned informal review period)
if OIRA has started a "substantive discussion with the agency
concerning the provisions of a draft rule or OIRA has received the rule
in draft." As a result of this change in policy, for the first time
OIRA began disclosing letters, telephone conversations, and meetings
that occurred during the informal review period. In its 2001 report on
the costs and benefits of federal regulations, OIRA described why the
office believed that these outside contacts before a rule is formally
submitted should be disclosed.
"Interested outside parties have gradually learned about this informal
process of agency-OIRA discussion and thus attempts are made to provide
information to agency and OIRA analysts. In order to protect the
integrity of OIRA and the administrative record, an informal practice
has developed that communications between OIRA and outside parties are
treated as 'covered by E.O. 12866' as soon as a rulemaking has
proceeded to a point where OIRA desk officers have received from
agencies copies of preliminary draft regulatory text or analysis.":
However, OIRA representatives that we contacted during this review
emphasized that a rule is not considered under review with regard to
these disclosure requirements if OIRA and an agency are in general
consultation about an issue, but the consultation has not become
"substantive" and/or the agency has not submitted a substantive draft
of a rule for informal review. Therefore, at that "preinformal review"
stage of the process, OIRA can communicate with outside parties about
the issue and not have to disclose those communications.
The October 2001 memorandum also announced that much of the information
generated through the disclosure requirements would be available to the
public on the agency's Web site, including summary information on
meetings, phone calls, and other oral communications with outside
parties and a list of the written correspondence that OIRA had received
from outside parties. The memorandum said that other information
previously available in hard copy and/or in the OIRA docket library
would also be posted to the Web site (e.g., monthly regulatory review
lists and statistics and the text of written outside
communications).[Footnote 34] Improving access to information about
OIRA's review process by putting the information on the office's Web
site has been widely hailed as a significant improvement in the
transparency of the regulatory review process.[Footnote 35]
However, we concluded that some of the information that OIRA provides
on its Web site regarding its communications with outside parties is
not very informative. As a result, it is sometimes difficult to
understand what rule a meeting was about or the affiliations of the
meeting participants. For example, during our review the OIRA Web site
provided the following descriptions:
* On February 3, 2003, an OIRA desk officer had a meeting with a person
whose affiliation was listed as "Albemarle" regarding an EPA issue
identified as "N-Propyl Bromid (nPB).":
* On October 24, 2002, OIRA leadership and staff met with four
individuals regarding a Centers for Medicare and Medicaid Services
issue identified as "Outpatient.":
* On June 27, 2002, the Administrator and other OIRA staff met with
several individuals whose affiliations were listed as "TPLG," "American
Association," "Powell Golstein," and "Hunton & Williams" regarding a
Centers for Medicare and Medicaid Services issue identified as
"Inherent Reasonableness.":
* On April 26, 2002, OIRA and OMB leadership and staff met with several
individuals regarding a General Services Administration issue
identified as "DOT Gov Rule: 3090-AH41." Two of the non-OMB
participants' affiliations were listed as "NASCIO" and "PTI.":
The OIRA Web site included a column for each meeting in which the
client being represented by an outside party could be identified.
However, we found that this column was usually blank. An OIRA
representative told us that he recognized that OIRA could sometimes do
a better job describing the rule being discussed at meetings as well as
the affiliations of the meeting participants, and said that he had
already notified OIRA staff that the information posted on executive
order meetings should be clearer regarding these issues (e.g., no
abbreviations when identifying the affiliations of outside parties).
OIRA's practice of providing minimal information to the public about
its meetings with outside parties stands in contrast to the more
formal, APA-driven practices of certain agencies that we reviewed. For
example, on October 26, 2001, the OIRA Administrator and three OIRA
staff members met with representatives of the automobile industry
regarding a NHTSA tire pressure monitoring proposed rule. Two
representatives from NHTSA were also present. The OIRA web page listed
the names and affiliations of those present. However, the DOT
electronic docket contained a memorandum providing that information and
also described the positions taken by the various parties at the
meeting. The memorandum indicated it was prepared pursuant to DOT Order
2100.2, which requires that DOT agencies prepare a report on meetings
with outside parties for the rulemaking docket. The DOT order also says
"a mere recitation that on X day a meeting was held with listed persons
to discuss a named general subject is inadequate.":
Disclosure of OIRA-Agency Interactions:
The Administrator's October 2001 memorandum also briefly discussed the
requirements in Executive Order 12866 regarding disclosure of OIRA's
interactions with the rulemaking agencies. For example, it stated that
OIRA would, upon request, provide certain materials to the public after
a reviewed rule had been published, including the draft as originally
submitted, any material submitted by the agency during the review,
pages where changes occurred in the course of review, and
correspondence between OIRA and the agency that had been exchanged
during the review.
However, OIRA representatives told us that the term "during the review"
in this context has a different meaning from the term "under review"
with regard to OIRA's contacts with outside parties. As mentioned
previously, OIRA considers a rule under review whenever informal review
begins, and said it would disclose all contacts with outside parties
after that date. In contrast, OIRA considers the period "during the
review" in relation to its contacts with the rulemaking agencies to
include only a rule's formal review period. Therefore, whereas OIRA
discloses its contacts with outside parties during informal reviews, it
does not disclose its contacts with rulemaking agencies during this
period.
Similarly, OIRA representatives also said that the transparency
requirements in the executive order that are applicable to the agencies
are not triggered by informal reviews. As noted previously, the
executive order requires agencies to identify for the public (1) "the
substantive changes between the draft submitted to OIRA for review and
the action subsequently announced," and (2) "those changes in the
regulatory action that were made at the suggestion or recommendation of
OIRA." The OIRA representatives said they considered the second of
these requirements to be a subset of the first, and that the term "the
draft submitted to OIRA for review" refers to the draft rule submitted
for formal review, not any drafts submitted for informal review.
Therefore, under this interpretation of the executive order, an agency
could submit a draft rule to OIRA for informal review, make changes in
response to multiple OIRA suggestions and recommendations, and neither
the agency nor OIRA would have to disclose those changes to the public.
If the rule was not subsequently changed during the formal review
period, OIRA would code the rule in its database as "consistent with no
change" and the public would never know that OIRA had influenced its
development.
OIRA representatives told us that drafts of a rule that are informally
submitted to OIRA do not represent the agency's official position, and
therefore should not be disclosed to the public even after the rule is
published. They also said that postpublication disclosure of
communications between OIRA and the agency that occur prior to formal
rule submission could have a "chilling effect" on those communications
in the future. Similarly, in its 2002 report on the costs and benefits
of regulations, OIRA said it believes "that its interactions with
agencies prior to formal regulatory review are pre-decisional
communications that should generally be insulated from public
disclosure in order to facilitate valuable deliberative exchanges."
However, in the same report, OIRA said "it is at these early stages
where OIRA's analytic approach can most improve the quality of
regulatory analyses and the substance of rules.":
During our review we found evidence that some of these OIRA-agency
communications are being disclosed. OIRA's and the agencies' dockets
for several of the rules that we examined in chapter 3 of this report
contained e-mails and faxes between OIRA and the agency about rules
under informal review. Those documents proved very helpful to us in
determining what changes had been made to agencies' rules at the
suggestion of OIRA.
Other Caveats:
There are also other caveats to the OIRA-agency transparency
requirements in the executive order and the Administrator's October
2001 memorandum. For example, OIRA representatives told us that the
requirement in the executive order that OIRA make available to the
public "all documents exchanged between OIRA and the agency" issuing
the regulation applies only to exchanges made by OIRA staff at the
branch chief-level and above. Therefore, any e-mails, faxes, or other
documents exchanged between OIRA desk officers and staff in regulatory
agencies about rules under review do not have to be disclosed.[Footnote
36] OIRA said that this "branch chiefs and above" distinction had been
the office's policy during the previous administration as well.
Other OIRA-agency interactions are not covered by any transparency
requirements. For example, if OIRA returns a rule to an agency for
reconsideration, the executive order requires the Administrator to
provide the agency with a written explanation for the return. The
return letter is then made available to the public. After OIRA
concludes its review and a rule is published, the executive order
requires the agency to disclose to the public the substantive changes
made during OIRA's review and those made at OIRA's suggestion or
recommendation. However, if an agency withdraws a rule from OIRA during
its review--either at its own initiative or at the recommendation of
OIRA--neither the agency nor OIRA is required to disclose the
reason.[Footnote 37]
OIRA's "Open Door" Policy on Meetings with Outside Parties:
In its December 2002 report on the costs and benefits of federal
regulations, OIRA said that it had adopted an "open door approach to
meeting with outside parties." In explanation, OIRA representative told
us that if a party outside of the federal government wanted to meet
with OIRA about a rule under review or a matter of general regulatory
policy, OIRA would always try and accommodate that request. OIRA
representatives emphasized that these meetings are initiated by the
outside parties, not OIRA. However, a former OIRA Administrator told us
that she did not believe that this "open door" policy was new, and said
OIRA had meetings with outside interest groups "all of the time" during
her tenure in the mid-1990s.
Information on the OIRA Web site indicated that from October 2001
through March 2003, OIRA had more than 100 meetings with outside
parties. Of these, at least 85 were with representatives of regulated
entities (primarily private companies); environmental and other public
interest
groups were involved in 8 meetings.[Footnote 38] OIRA representatives
said that one possible explanation for the apparent imbalance in those
with whom OIRA meets is that there are more regulated entities that are
directly affected by agencies' regulations than public interest groups
who have a more general interest in the issues. However, another
possible explanation is that, while OIRA has said that it will meet
with any organization that wants to meet with it about a rule under
review, representatives of several public interest groups told us some
such groups have made a policy decision to not request meetings with
OIRA. They said they take this position because their groups do not
believe that OIRA is the proper locus of authority or decision making
with regard to rulemaking issues.
Hiring of Additional Staff Specialists:
OIRA has also changed the office's human capital strategy in recent
years, increasing both the number of staff and adding new types of
expertise. As figure 8 shows, when OIRA was created in fiscal year 1981
the office had an FTE ceiling of 90 staff members. By 1997, the number
of FTEs allocated to OIRA declined to 47--a nearly 50 percent reduction
since 1981. OIRA noted in its December 2002 report on the costs and
benefits of regulations that the decline in OIRA staffing during this
period was more pronounced than the decline in OMB as a whole, and
occurred at a time when OIRA was given new statutory responsibilities
(e.g., concerning unfunded mandates, small business, regulatory
accounting, and information policy) and when regulatory agencies'
staffing and budgetary levels were increasing. Also during this period,
though, with the advent of Executive Order 12866 in late 1993, the
number of rules that OIRA reviewed went from between 2,000 and 3,000
per year to between 500 and 700 per year.
Figure 8: OIRA Recently Reversed a 20-year Decline in Staffing:
[See PDF for image]
[End of figure]
As the figure shows, OIRA's staffing authorization began to increase in
2001, and by 2002 the office had 55 authorized FTEs.[Footnote 39]
Between 2001 and 2003, OIRA had hired five new "specialist" or "expert"
staff members who were intended to provide new science and engineering
expertise to OIRA:
* A risk assessor who received her Ph.D. in environmental health/
molecular toxicology from the University of Washington and who most
recently had been a science and technology fellow at EPA's National
Center for Environmental Assessment.
* An epidemiologist who received her Ph.D. in geography (resources
management) from Clark University and who had worked on exposure
assessment issues at EPA and was an environmental professor and
researcher at the schools of health at Johns Hopkins University and
Harvard University.
* An engineer who received his Ph.D. in health policy from Harvard
University and a Masters of Science from the Massachusetts Institute of
Technology in civil and environmental engineering and technology and
policy. He previously worked at Resources for the Future and the
consulting firm Industrial Economics Incorporated.
* A health economist who received her Ph.D. in health policy from
Harvard University and a Master of Science degree in earth systems from
Stanford University. She formerly worked at the American Enterprise
Institute.
* An economist who received his Ph.D. in economics from the University
of North Carolina at Chapel Hill and who formerly worked at FDA's
Center for Food Safety and Applied Nutrition.
In its December 2002 report on regulatory costs and benefits, OIRA said
these hires would facilitate collaboration with staff in the Office of
Science and Technology Policy and would "enable us to develop a more
diversified pool of expertise to ask penetrating technical questions
about agency proposals." In an October 2002 speech, the Administrator
said that these new hires also reflected "the increasing importance of
science-based regulation in the federal agencies." He also indicated
that his vision for how OIRA should be staffed is similar to that
outlined in a 1993 book by Stephen Breyer (later appointed to the
Supreme Court), who suggested the creation of a small, technically-
trained group within OMB that offered its members a special civil
service career path--similar to that of the French Conseil d'
Etat.[Footnote 40] Breyer also indicated that this group might assume
OIRA's mandate to review agencies' proposed rules, "augmented by its
missions to rationalize risk regulation and seek tradeoffs." The OIRA
Administrator said "although I am not sure that the British or French
civil service are exactly the right analogies, I do have in mind a
talented and analytically keen staff who know how markets work, how
government works, and respect the role of expertise and values in
solving national problems.":
Both former OIRA Administrators with whom we spoke supported increasing
the number of OIRA staff. However, both also indicated that they never
felt that OIRA was lacking in technical expertise and that they could
always tap into the resources available in other parts of the Executive
Office of the President (e.g., the Office of Science and Technology
Policy or the Council of Economic Advisors) or other agencies if the
need arose. An OIRA branch chief said the office still utilizes staff
from other agencies from time to time, in addition to using its new "in
house" expertise.
Relationship With SBA Office of Advocacy:
In March 2002, the OIRA Administrator and the SBA chief counsel for
advocacy signed a memorandum of understanding (MOU) committing OIRA and
the Office of Advocacy to work together to ensure that federal agencies
comply with the Regulatory Flexibility Act.[Footnote 41] As part of
OIRA's regulatory reviews, the MOU requires OIRA to consider whether
agencies should have prepared regulatory flexibility analyses under the
act. If the Office of Advocacy has concerns about an agency's analysis,
the MOU requires OIRA to provide a copy of the draft rule to that
office. Also, the MOU says that OIRA would help the Office of Advocacy
develop guidance for agencies to follow in complying with the act. In
May 2003 testimony before the House Committee on Small Business, the
OIRA Administrator said that this agreement would enhance OIRA's and
SBA's ability to ensure that agencies are meeting their Regulatory
Flexibility Act responsibilities.
However, in that same testimony the Administrator said that the
memorandum of understanding would "formalize OIRA's long-standing
practice of involving the Office of Advocacy in our review of agency
regulations." In response to recommendations in our March 1994 report
on the administration of the Regulatory Flexibility Act, the SBA chief
counsel for advocacy said that she would send OMB a copy of any written
notifications of noncompliance with the act that she sends to the
agencies during the rulemaking process.[Footnote 42] She and the Deputy
Administrator of OIRA said they would work together to develop criteria
and procedures for determining agency compliance with the act. The
Deputy Administrator also said that if the chief counsel notified OMB
about an agency's compliance with the Regulatory Flexibility Act, OMB
would discuss the issue with the agency before concluding its review of
any final regulations.
Proposed New Guidelines on Economic Analysis:
One of the more controversial elements of OIRA's regulatory review
function involves its examination of agencies' regulatory impact
analyses that are required in support of the 70 to 110 rules that the
office has reviewed in recent years that are "economically significant"
(e.g., have a $100 million impact on the economy). As of May 2003,
OIRA's approach to these reviews had not officially changed. However,
OIRA had initiated a process that may ultimately result in alterations
to its current procedures.
In January 1996, OIRA published a document entitled "Economic Analysis
of Federal Regulations Under Executive Order 12866." Developed by a
group established by the OIRA Administrator and cochaired by a member
of the Council of Economic Advisers (CEA), the document described "best
practices" for preparing the economic analysis of significant
regulatory actions called for by the executive order.[Footnote 43] In
general, the guidance states that the agencies' analyses should contain
three elements: (1) a statement of the need for the proposed action,
(2) an examination of alternative approaches, and (3) an analysis of
benefits and costs. Within each of these areas, the guidance provides
additional information. For example, in the discussion of benefits and
costs, the guidance addresses such issues as discounting (when benefits
and costs occur at different times), the treatment of risk and
uncertainty, and general methods for valuing health and safety benefits
(e.g., the monetary valuation of reductions in the risk of illness,
injury, and premature death). Each of these issues can have a major
effect on agencies' estimates of benefits and costs. For example, in a
February 2003 speech the OIRA Administrator noted that the present
value of 1,000 lives saved 50 years from now is 608 when evaluated at 1
percent discount rate, 228 when evaluated at 3 percent, and 34 when
evaluated at 7 percent.[Footnote 44]
In its December 2002 final report on the costs and benefits of federal
regulations, OIRA noted that it had initiated "a process of refinement"
to the guidance. In its February 2003 draft report, OIRA said the
review was again cochaired by the Administrator and a member of the
CEA, and published proposed revised guidelines for comment. OIRA said
the key changes in the proposed guidelines included the following:
* The proposal encourages agencies to perform both cost-effectiveness
and benefit-cost analyses in support of major rules, where feasible,
because the two techniques offer regulators somewhat different but
useful perspectives. In the previously mentioned February 2003 speech,
the Administrator described cost-effectiveness analysis as a "bang for
the buck" exercise in which the payoff is measured in health units
rather than dollars. However, since cost-effectiveness analysis only
provides relative comparisons, he said benefit-cost analysis is still
needed to determine whether the benefits of any particular alternative
justify the costs. Also, the Administrator said that OMB believes that
multiple effectiveness measures based on different value assumptions
and research designs should be encouraged (which he said can lead to
inconsistency). To promote more consistency, he said OMB would sponsor
interagency discussions about the most promising and practical
effectiveness measures. Also, he said OMB would request that agencies
provide it with their original data on mortality and morbidity to allow
OMB to compare across agencies using similar assumptions and methods
(as an aid to performance-based budgeting).
* When the benefits and costs of rules are expected to occur in
different periods, the proposal recommends that agencies report the
results of their analyses using multiple discount rates. Historically,
OMB has recommended a uniform 7 percent rate of discount for these
rules. Now, the proposal recommends that the results be computed at
both 3 percent and 7 percent for rules with impacts primarily within
this generation. However, for rules with intergenerational impacts, the
proposal permits additional sensitivity analysis with rates as low as 1
percent.
* For rules that are expected to have a more than $1 billion impact on
the economy, the proposal calls for agencies to employ formal
probability analysis of benefits and costs (rather than a single
number) unless the benefits and costs are known with a high degree of
certainty. The Administrator said that information on probabilities is
crucial when agencies must decide whether to act now, based on
imperfect science, or whether to collect additional information prior
to rulemaking--particularly in relation to "low-probability, high-
consequence events such as the events of September 11TH.":
The February 2003 draft guidelines also noted that two widely used
techniques were being used to assign a monetary value to projected
reductions in premature mortality--(1) the value of a statistical life
(VSL) and (2) the value of a statistical life year (VSLY). The
guidelines pointed out a number of technical issues associated with the
appropriate use of these measures, and said "in all instances—agencies
should consider providing estimates of both VSL and VSLY, while
recognizing the developing states of knowledge in this area."
Subsequently, AARP and other organizations expressed concern that use
of the VSLY approach could lead to an undervaluing of the lives of
older adults. On May 30, 2003, the OIRA Administrator sent a memorandum
to the President's Management Council that again recommended that
agency benefit-cost analysts present both VSL and VSLY methods.
However, the Administrator cautioned that a "simple VSLY method" (i.e.,
assuming that saving 10 life years is 10 times more valuable than
saving 1 life year) "could underestimate benefits significantly when
applied to rules that primarily or significantly benefit senior
citizens." He went on to say that, "when benefit estimates based on the
VSLY method are presented, as OMB has encouraged since 1996, I
recommend that agencies present analyses with larger VSLY estimates for
senior citizens."[Footnote 45]
In February 2003, OIRA released the draft guidelines for public
comment. After the comment period, OIRA said that it planned to conduct
an interagency review of the draft guidelines. Until this process is
complete, OIRA said that it would continue to use the 1996 best
practices guidance document. However, as noted earlier in this chapter,
some agency officials told us that OIRA already expects agencies' cost-
benefit analyses to be more thorough than they were required to be
several years ago.
New Guidelines on Risk Assessment:
Some (but by no means all) of OIRA's regulatory reviews evaluate
whether an agency's assessment of the exposure to a risk or
environmental hazard was properly conducted. Risk assessment is a
complex but valuable set of tools for federal regulatory agencies,
helping them to identify issues of potential concern, select regulatory
options, and estimate the range of a forthcoming regulation's benefits.
As we noted in our August 2001 report, the statutory and legal context
in which risk assessments are conducted determine the general focus and
goals of an agency's risk assessment activities, and also may shape how
those assessments are supposed to be
conducted.[Footnote 46] Therefore, different agencies (and different
offices within those agencies) may have distinctive concerns regarding
chemical risks. OIRA's January 1996 "best practices" guidance contains
a section on risk assessment, stating in general terms the qualities of
a good assessment. For example, it says that assessments "should
present results representing a range of plausible scenarios, together
with any information that can help in providing a qualitative judgment
of which scenarios are more scientifically plausible." It also says
that risk assessments "must provide some estimates of the probability
distribution of risks with and without the regulation" and, where
possible, "some estimates of central tendency (e.g., mean and median)
must be provided in addition to ranges, variances, specified low-end
and high-end percentile estimates, and other characteristics of the
distribution.":
In 1996, Congress adopted a basic standard of quality for the use of
science in health decisions under the Safe Drinking Water Act (SDWA).
Specifically, Congress provided that if an agency's decision under the
statute was based on science, it should use "(i) the best available,
peer-reviewed science and supporting studies conducted in accordance
with sound and objective scientific practices, and (ii) data collected
by accepted methods or best available methods (if the reliability of
the method and the nature of the decision justifies the use of data)."
Congress also adopted a standard for the dissemination of public
information involving risks under SDWA, providing that agencies should
"ensure that the presentation of information on (risk) effects is
comprehensive, informative, and understandable." In addition, Congress
required that agencies should, to the extent practicable, specify and
make available to the public in a supporting document information on
(1) each population addressed by any estimate of applicable risk
effects, (2) the expected risk or central estimate of risk for the
affected populations, (3) each appropriate upper-bound or lower-bound
estimate of risk, (4) each significant uncertainty identified in the
process of the risk assessment (and any studies that would help resolve
the uncertainty), and (5) relevant peer-reviewed studies regarding the
estimated risk effects.
In his September 2001 memorandum on presidential review of agency
rulemaking, the OIRA Administrator proposed expanding the applicability
of these requirements to statutes other than SDWA. Specifically, he
recommended that each agency consider adopting or adapting these
standards for judging the quality of scientific information that it
uses about risk. These recommendations were subsequently contained in
information quality guidelines intended to ensure and maximize the
quality, objectivity, utility, and integrity of a wide range of
information disseminated by federal agencies.[Footnote 47] The
Administrator said that under these guidelines "the public will be
provided an opportunity to challenge any health risk information
disseminated by a federal agency that does not adhere to the OMB and
agency guidelines. Agencies will be expected to provide a prompt and
objective response to these challenges." An OIRA representative said
the office considered the SDWA risk assessment standards "reasonable"
and a "model" approach the could be used in regulations under other
statutes (unless, of course, those other statutes prohibited that
approach).
Deference to Peer Reviewed Regulatory Analyses:
In his September 2001 memorandum on "Presidential Review of Agency
Rulemaking by OIRA," the OIRA Administrator said OMB recommended that
agencies subject regulatory impact analyses and other supporting
documents to independent, external peer review. He also delineated
certain peer review practices that OMB recommended, including (1)
selection of reviewers primarily on the basis of necessary technical
expertise, (2) disclosure of reviewers' prior positions on the issues
at hand as well as sources of personal and institutional funding, and
(3) implementation of the review in an open and rigorous manner. In the
previously mentioned information quality guidelines, OMB noted that if
peer review is used to help satisfy the "objectivity" standard, the
review process should meet these criteria. The OIRA Administrator has
described EPA's 2001 decision on arsenic as an example of a quality,
peer-reviewed study.
Although OIRA did not require greater use of peer review by rulemaking
agencies in this September 2001 memorandum, the Administrator said that
OIRA would "be giving a measure of deference" to agencies' analyses
that were developed in conjunction with certain peer review
principles.[Footnote 48] In one of his speeches he said that this
deference to peer reviewed studies was intended to serve as an
incentive to improved regulatory analysis--the "carrot" portion of the
"carrot and stick" approach mentioned previously.
However, two former OIRA Administrator indicated that similar deference
was given during the previous administration to peer reviewed
regulatory analyses, and that the current administration's initiative
in this area reflected a change in the degree to which deference is
given rather than a substantial change of direction. On the other hand,
they also said the current policy is more explicit than the previous
administration's approach.
[End of section]
Chapter 3: OIRA's Effects on Rules Submitted for Executive Order Review
Varied:
[End of section]
OIRA had a significant effect on 25 of the 85 draft proposed and final
rules from nine selected agencies that it reviewed between July 1,
2001, and June 30, 2002; 17 of the rules were significantly changed by
OIRA, 7 were returned to the agencies for reconsideration, and 1 was
withdrawn by the agency at OIRA's request.[Footnote 49] Almost all of
the rules that were significantly changed at OIRA's suggestion were
from EPA. Almost all of the returned rules were from DOT, as was the
rule withdrawn at OIRA's request. Many of OIRA's actions in these cases
were prompted by concerns about the quality of the agencies' regulatory
analyses and/or whether the agencies had selected the most cost-
effective regulatory option. For 22 of the 25 rules, OIRA's actions
appeared to have at least some effect on the costs and benefits
associated with the rule or to have prompted revisions in the agency's
estimates of those costs and benefits. There was evidence that outside
parties had contacted OIRA before or during OIRA's formal review period
regarding about half of the significantly changed rules, two of the
returned rules, and the rule withdrawn at OIRA's request. Although
OIRA's positions regarding these rules were sometimes similar to those
expressed by outside parties, it is impossible to determine the extent
to which those contacts might have influenced OIRA's actions, if at
all. ORIA might have reached the same conclusions in the absence of
those contacts. Some of the agencies did not clearly identify all of
the changes made to their rules during OIRA's review or at OIRA's
suggestion--as required by Executive Order 12866. However, other
agencies clearly identified those changes.
OIRA Significantly Affected About One-Third of the Rules That the
Selected Agencies Submitted for Review:
Our second objective was to provide detailed information on rules that
were significantly changed by OIRA, withdrawn at OIRA's initiative, or
returned to the agencies for reconsideration. According to the OIRA
database, from July 1, 2001, through June 30, 2002, OIRA completed 642
reviews of agencies' draft regulatory actions submitted under Executive
Order 12866. The dispositions of these reviews were as follows:
* About 33 percent (214) were coded in the database as "consistent with
no change," indicating that OIRA considered the rules consistent with
the executive order as submitted.
* About 50 percent (322) were coded as "consistent with change,"
indicating that the rules had changed after being submitted to OIRA,
and that OIRA subsequently concluded that the rule was consistent with
the executive order's requirements.
* About 8 percent (50) were coded as "withdrawn" by the agency.
* About 3 percent (21) were coded as "returned" to the agency by OIRA.
* About 5 percent (35) had some other disposition (e.g., "sent
improperly," "emergency," or "statutory or judicial deadline").
Because the number of changed, returned, or withdrawn rules
governmentwide during this time frame was so large (393), we focused
this part of our review on 85 proposed and final rules with those
dispositions that were submitted to OIRA by nine selected agencies or
offices:[Footnote 50]
* The Animal and Plant Health Inspection Service within the Department
of Agriculture.
* The Food and Drug Administration within the Department of Health and
Human Services.
* The Occupational Safety and Health Administration within the
Department of Labor.
* The Federal Aviation Administration, the Federal Motor Carrier Safety
Administration, and the National Highway Traffic Safety Administration
within the Department of Transportation.
* The Offices of Air and Radiation, Solid Waste and Emergency Response,
and Water within EPA.
We selected these agencies and offices because the OIRA database
indicated they had the most rules that were changed, withdrawn, or
returned during the relevant 1-year period.
Table 1 shows the number of rules with each type of OIRA disposition
within each of the selected agencies or offices. We generally did not
question the rule dispositions used in the OIRA database. However, we
included one rule from EPA's Office of Air and Radiation in the
"consistent with change" category that had been coded as a "deadline
case" in the database because publicly available information indicated
that the rule had been changed in response to OIRA's review (ID
41).[Footnote 51] It is unclear whether other rules with "deadline
case" outcome codes in the database were also changed by OIRA, or why
other rules that we reviewed with legal deadlines were not coded as
deadline cases.[Footnote 52] Also, we dropped one rule from EPA's
Office of Solid Waste and Emergency Response that was coded "consistent
with change" because it had not been published in the Federal Register
at the time of our review.
Table 1: Selected Agencies' Regulatory Submissions by Outcome:
Agency: APHIS; Number of rules reviewed between July 1, 2001, and June
30, 2002, that were coded in the OIRA database as: Consistent with
change: 12; Number of rules reviewed between July 1, 2001, and June 30,
2002, that were coded in the OIRA database as: Returned to agency: 0;
Number of rules reviewed between July 1, 2001, and June 30, 2002, that
were coded in the OIRA database as: Withdrawn by the agency: 1; Total:
13.
Agency: FDA; Number of rules reviewed between July 1, 2001, and June
30, 2002, that were coded in the OIRA database as: Consistent with
change: 7; Number of rules reviewed between July 1, 2001, and June 30,
2002, that were coded in the OIRA database as: Returned to agency: 0;
Number of rules reviewed between July 1, 2001, and June 30, 2002, that
were coded in the OIRA database as: Withdrawn by the agency: 2; Total:
9.
Agency: OSHA; Number of rules reviewed between July 1, 2001, and June
30, 2002, that were coded in the OIRA database as: Consistent with
change: 5; Number of rules reviewed between July 1, 2001, and June 30,
2002, that were coded in the OIRA database as: Returned to agency: 0;
Number of rules reviewed between July 1, 2001, and June 30, 2002, that
were coded in the OIRA database as: Withdrawn by the agency: 0; Total:
5.
Agency: DOT-FAA; Number of rules reviewed between July 1, 2001, and
June 30, 2002, that were coded in the OIRA database as: Consistent with
change: 5; Number of rules reviewed between July 1, 2001, and June 30,
2002, that were coded in the OIRA database as: Returned to agency: 6;
Number of rules reviewed between July 1, 2001, and June 30, 2002, that
were coded in the OIRA database as: Withdrawn by the agency: 1; Total:
12.
Agency: DOT-FMCSA; Number of rules reviewed between July 1, 2001, and
June 30, 2002, that were coded in the OIRA database as: Consistent with
change: 6; Number of rules reviewed between July 1, 2001, and June 30,
2002, that were coded in the OIRA database as: Returned to agency: 0;
Number of rules reviewed between July 1, 2001, and June 30, 2002, that
were coded in the OIRA database as: Withdrawn by the agency: 0; Total:
6.
Agency: DOT-NHTSA; Number of rules reviewed between July 1, 2001, and
June 30, 2002, that were coded in the OIRA database as: Consistent with
change: 5; Number of rules reviewed between July 1, 2001, and June 30,
2002, that were coded in the OIRA database as: Returned to agency: 1;
Number of rules reviewed between July 1, 2001, and June 30, 2002, that
were coded in the OIRA database as: Withdrawn by the agency: 1; Total:
7.
Agency: EPA Office of Air and Radiation; Number of rules reviewed
between July 1, 2001, and June 30, 2002, that were coded in the OIRA
database as: Consistent with change: 14; Number of rules reviewed
between July 1, 2001, and June 30, 2002, that were coded in the OIRA
database as: Returned to agency: 1; Number of rules reviewed between
July 1, 2001, and June 30, 2002, that were coded in the OIRA database
as: Withdrawn by the agency: 0; Total: 15.
Agency: EPA Office of Solid Waste and Emergency Response; Number of
rules reviewed between July 1, 2001, and June 30, 2002, that were coded
in the OIRA database as: Consistent with change: 9; Number of rules
reviewed between July 1, 2001, and June 30, 2002, that were coded in
the OIRA database as: Returned to agency: 0; Number of rules reviewed
between July 1, 2001, and June 30, 2002, that were coded in the OIRA
database as: Withdrawn by the agency: 0; Total: 9.
Agency: EPA Office of Water; Number of rules reviewed between July 1,
2001, and June 30, 2002, that were coded in the OIRA database as:
Consistent with change: 8; Number of rules reviewed between July 1,
2001, and June 30, 2002, that were coded in the OIRA database as:
Returned to agency: 1; Number of rules reviewed between July 1, 2001,
and June 30, 2002, that were coded in the OIRA database as: Withdrawn
by the agency: 0; Total: 9.
Agency: Total; Number of rules reviewed between July 1, 2001, and June
30, 2002, that were coded in the OIRA database as: Consistent with
change: 71; Number of rules reviewed between July 1, 2001, and June 30,
2002, that were coded in the OIRA database as: Returned to agency: 9;
Number of rules reviewed between July 1, 2001, and June 30, 2002, that
were coded in the OIRA database as: Withdrawn by the agency: 5; Total:
85.
Source: OIRA's database.
Note: Data in each category reflect the number of proposed, final, and
interim final rules that OIRA reviewed between July 1, 2001, and June
30, 2002, but do not include other types of regulatory actions
submitted to OIRA during this period (e.g., notices, prerules, or
emergency rules). As discussed later in this report, the nine returned
rules included two improper submissions--one from FAA and one from the
EPA Office of Air and Radiation.
[End of table]
Although the OIRA database was useful in focusing our review on certain
agencies and rules, the categories used in that database are broader
than the specific types of rules targeted in this section of our
report--those that were significantly affected by OIRA.
* The "consistent with change" category includes all rules that were
changed between their formal submission to OIRA for review and their
issuance by the agency, regardless of the source or the significance of
the changes made--not just those that were significantly changed at
OIRA's request. For example, even if the only change made to a rule
during OIRA's review was the correction of a legal citation made by the
submitting agency, the rule would be coded in the database as
"consistent with change.":
* The "returned" category includes all returns, not just those that
were substantively "returned for reconsideration." Therefore, if OIRA
returned a rule solely because it was not subject to OIRA review (e.g.,
was improperly submitted), it would be coded in the database as a
"returned" rule.
* The "withdrawn" category includes all rules withdrawn by the agencies
during OIRA's review, not just those that were withdrawn at the
initiation of OIRA. Therefore, if an agency erroneously submitted a
rule to OIRA and withdrew it solely at the agency's initiative, the
rule would be coded in the OIRA database as "withdrawn.":
Because of the breadth of these categories, we had to gather additional
information on each of the 85 changed, returned or withdrawn rules to
determine which ones had been significantly affected by OIRA and,
therefore, met our more specific criteria.
Ultimately, we determined that 25 of the 85 rules from these agencies
were significantly affected by OIRA's review. Specifically, we
concluded that 17 of the 71 rules that were coded as "changed" in the
database were significantly affected by OIRA. Seven of the nine rules
coded as "returned" were returned by OIRA for substantive reasons. One
of the five "withdrawn" rules was returned at the initiation of OIRA.
OIRA Did Not Significantly Affect Many of the "Changed" Rules:
We used a variety of information sources (e.g., agency and OIRA docket
materials and interviews with agency officials) to place each of the 71
rules coded as "consistent with change" into one of three categories:
1. Significant changes--i.e., rules in which the most significant
changes attributed to OIRA's or OMB's suggestions affected the scope,
impact, or estimated costs and benefits of the rules as originally
submitted to OIRA.[Footnote 53] Usually, these significant changes were
made to the regulatory language that would ultimately appear in the
Code of Federal Regulations.
2. Other material changes--i.e., rules in which the most significant
changes attributed to OIRA's or OMB's suggestions resulted in the
addition or deletion of material in the explanatory preamble section of
the rule. For example, OIRA may have recommended that agencies provide
better explanations for certain rulemaking actions and/or suggested
that agencies ask the public to comment on particular aspects of the
rules.
3. Minor or no OIRA/OMB changes--i.e., rules in which the most
significant changes attributed to OIRA's or OMB's suggestions resulted
in editorial or other minor revisions, or rules in which changes
occurred prior to publication but not at the suggestion of OIRA or OMB.
Where no changes were made at OIRA's or OMB's suggestion, the changes
that caused the rule to be coded "consistent with change" could have
been initiated by the regulatory agency itself or by another federal
agency (e.g., the Office of the Federal Register).[Footnote 54]
We placed each of the rules that we examined into the appropriate
category based on the most significant changes attributed to either
OIRA or OMB--even if the regulatory agencies initiated more significant
changes to their rules during the period of OIRA's review than did
OIRA.[Footnote 55]
Table 2 presents the results of our analysis by agency. We concluded
that 17 of the 71 rules coded as "consistent with change" in the OIRA
database (about 24 percent) were significantly changed as a result of
OIRA's suggestion or recommendation, 34 of the rules had other material
changes attributable to requests by OIRA, and 20 rules had only minor
changes or no changes at OIRA's suggestion or recommendation. Fourteen
of the 17 significantly changed rules were from EPA--all but one of
which were from the agency's Offices of Air and Radiation or Water.
Three other rules had significant changes attributed to suggestions
from OIRA or OMB--two APHIS rules regarding indemnity payments for the
destruction of diseased animals and one NHTSA rule on tire pressure
monitoring systems. (See app. II for the coding and detailed
descriptions of the changes made to each of the 71 rules.):
Table 2: Nature of Changes Made at the Suggestion or Recommendation of
OIRA:
Agency: APHIS; Number of rules by most significant level of change
suggested by OIRA: Significant changes: 2; Number of rules by most
significant level of change suggested by OIRA: Other material changes:
9; Number of rules by most significant level of change suggested by
OIRA: Minor or no changes: 1; Total rules changed after submission to
OIRA: 12.
Agency: FDA; Number of rules by most significant level of change
suggested by OIRA: Significant changes: 0; Number of rules by most
significant level of change suggested by OIRA: Other material changes:
6; Number of rules by most significant level of change suggested by
OIRA: Minor or no changes: 1; Total rules changed after submission to
OIRA: 7.
Agency: OSHA; Number of rules by most significant level of change
suggested by OIRA: Significant changes: 0; Number of rules by most
significant level of change suggested by OIRA: Other material changes:
2; Number of rules by most significant level of change suggested by
OIRA: Minor or no changes: 3; Total rules changed after submission to
OIRA: 5.
Agency: DOT-FAA; Number of rules by most significant level of change
suggested by OIRA: Significant changes: 0; Number of rules by most
significant level of change suggested by OIRA: Other material changes:
2; Number of rules by most significant level of change suggested by
OIRA: Minor or no changes: 3; Total rules changed after submission to
OIRA: 5.
Agency: DOT-FMCSA; Number of rules by most significant level of change
suggested by OIRA: Significant changes: 0; Number of rules by most
significant level of change suggested by OIRA: Other material changes:
3; Number of rules by most significant level of change suggested by
OIRA: Minor or no changes: 3; Total rules changed after submission to
OIRA: 6.
Agency: DOT-NHTSA; Number of rules by most significant level of change
suggested by OIRA: Significant changes: 1; Number of rules by most
significant level of change suggested by OIRA: Other material changes:
2; Number of rules by most significant level of change suggested by
OIRA: Minor or no changes: 2; Total rules changed after submission to
OIRA: 5.
Agency: EPA Office of Air and Radiation; Number of rules by most
significant level of change suggested by OIRA: Significant changes: 7;
Number of rules by most significant level of change suggested by OIRA:
Other material changes: 4; Number of rules by most significant level of
change suggested by OIRA: Minor or no changes: 3; Total rules changed
after submission to OIRA: 14.
Agency: EPA Office of Solid Waste and Emergency Response; Number of
rules by most significant level of change suggested by OIRA:
Significant changes: 1; Number of rules by most significant level of
change suggested by OIRA: Other material changes: 4; Number of rules by
most significant level of change suggested by OIRA: Minor or no
changes: 4; Total rules changed after submission to OIRA: 9.
Agency: EPA Office of Water; Number of rules by most significant level
of change suggested by OIRA: Significant changes: 6; Number of rules by
most significant level of change suggested by OIRA: Other material
changes: 2; Number of rules by most significant level of change
suggested by OIRA: Minor or no changes: 0; Total rules changed after
submission to OIRA: 8.
Agency: Total; Number of rules by most significant level of change
suggested by OIRA: Significant changes: 17; Number of rules by most
significant level of change suggested by OIRA: Other material changes:
34; Number of rules by most significant level of change suggested by
OIRA: Minor or no changes: 20; Total rules changed after submission to
OIRA: 71.
Source: GAO analysis.
[End of table]
As figure 9 illustrates, rules from EPA's Office of Air and Radiation
and Office of Water were more often significantly changed at the
suggestion of OIRA than rules from the other agencies and offices that
we examined.
Figure 9: EPA Air and Water Rules Were More Often Significantly Changed
at the Suggestion of OIRA:
[See PDF for image]
[End of figure]
Types of Significant Changes Made at OIRA's Suggestion/Recommendation:
In 6 of the 14 EPA rules that were significantly changed, the primary
effect of OIRA's suggestions or recommendations was to delay or
eliminate certain regulatory provisions that were included in the draft
rules as submitted to OIRA. For example:
* In response to OIRA concerns about the information collection request
associated with an EPA Office of Air and Radiation final rule on
consolidated emissions reporting, EPA delayed the compliance date for
states to report on two types of emissions (ID 50).
* OIRA's suggestions also prompted the deletion of provisions covering
marine and highway motorcycle engines from an EPA Office of Air and:
Radiation proposed rule on emissions from nonroad large spark-ignition
engines and recreational engines (ID 41).[Footnote 56]
* EPA eliminated manganese from a list of hazardous constituents in an
Office of Solid Waste and Emergency Response final rule on the
identification and list of hazardous wastes in response to comments
from OIRA (ID 56).
In four other significantly changed EPA rules, OIRA suggestions
encouraged the agency to change, add, or select regulatory alternatives
that generally provided more flexible and/or less costly compliance
options to regulated entities. For example:
* OIRA suggestions led to changes in an EPA Office of Water proposed
rule on pollutant discharge elimination systems for large cooling water
intake structures at existing power generating facilities that (1)
lowered the performance standard in the rule, (2) made compliance
requirements more flexible by allowing options for a site-specific
approach to minimizing environmental harm, and (3) broadened a
restoration option whereby firms may repair environmental harm rather
than comply with the designated performance standard (ID 68). OIRA
believed that these options were not only less burdensome, but also
would yield greater net benefits.
* In a related EPA Office of Water final rule on minimizing
environmental impact from cooling water intake structures at new
facilities, OIRA-suggested changes included (1) the addition of
criteria that would allow more facilities to qualify for lower
performance standards, (2) a changed requirement so that facilities
only needed to use screens to minimize impingement mortality of fish
and shellfish if certain criteria were met, and (3) the addition of an
exception to intake flow requirements regarding cooling water intake
structures located in a lake or reservoir (ID 65).
In three other EPA rules and the NHTSA tire pressure monitoring systems
rule, OIRA suggested significant changes to the agencies' regulatory
impact analysis. For example:
* OIRA suggestions prompted EPA to make changes regarding the discount
rates and fuel prices that the agency used to estimate the potential
costs of a proposed rule on nonconformance penalties and emission
standards for heavy-duty diesel engines and vehicles (ID 53).
* Similarly, OIRA comments led EPA to revise the cost-benefit and cost-
effectiveness estimates in a proposed rule on emissions from spark
ignition marine vessels and highway motorcycles (ID 54).
In both of the APHIS rules with significant changes attributed to
requests from OMB, the changes reduced the potential total cost to the
federal government of paying indemnities to owners of animals destroyed
or for other measures taken to avoid the spread of certain communicable
diseases among animals (IDs 9 and 12).
Rules With "Other Material Changes" Attributable to OIRA:
We concluded that in 34 (about 48 percent) of the 71 "consistent with
change" rules, regulatory agencies made "other material changes" in
response to OIRA's suggestions or recommendations. Typically, these
changes augmented an agency's explanation of certain provisions in the
rule, clarified the agency's basis for decisions made about regulatory
options or assumptions, better explained the potential impact of
different options, or requested public comments and data on regulatory
options or costs. For example, in response to OIRA's suggestions or
recommendations:
* APHIS revised the preamble to a rule that updated plant pest
regulations to (1) clarify that the proposed regulations would not
cover genetically modified organisms, (2) acknowledge there is a
continuum of risk related to regulated organisms, (3) solicit comments
about the adequacy of criteria APHIS used to identify organisms for
inclusion, and (4) solicit comments on the data elements that would
have to be addressed in a proposed notification system (ID 6).
* FDA added or revised information to the preamble of a final rule on
notification and recordkeeping requirements for exports to clarify its
responses to public comments on the proposed rule (ID 13).
* OSHA revised the preamble to a rule on procedures for handling
discrimination complaints (1) to add information and request public
comment regarding the whistle-blower model that OSHA chose and (2) to
clarify that certain procedures would be triggered at the "request of
the named person" (the person alleged to have violated the act) (ID
21).
* EPA's Office of Air and Radiation revised the preamble of its
proposed rule on national emission standards for hazardous air
pollutants from surface coating of metal furniture to request public
comments on (1) its conclusion that the creation of subcategories in
the rule was not warranted and (2) whether there were alternative means
of monitoring performance for add-on controls at source facilities that
would be as effective and less expensive than the proposed requirements
(ID 47).
Rules in Which OIRA Suggested Minor Changes or No Changes:
OIRA suggested only editorial or other minor changes, or no changes at
all, in 20 (about 28 percent) of the 71 rules coded in the OIRA
database as "consistent with change." These minor changes included
rearranging existing text for clarity, correcting spelling errors,
making word choice changes, and adding or correcting procedural
language, such as where to submit public comments on the rules being
published. For example:
* The only two changes that OIRA suggested in a FMCSA rule on
certification of safety auditors, investigators, and inspectors were to
delete a redundant sentence and to correct the number cited for a
relevant executive order (ID 33).
* In an EPA proposed rule on a national ambient air quality standard
for ozone, OIRA suggested rewording three similar statements in the
preamble regarding EPA's views about "using plausible but highly
uncertain assumptions" (ID 42).
* The only change made at OIRA's suggestion in an EPA hazardous waste
management rule concerning cathode ray tubes and mercury-containing
equipment was to revise a request for comments on extending the
"speculative accumulation time of used, broken CRTs" to "two or more
years" instead of just "two years" (ID 62).
As noted previously, although we concluded that OIRA suggested only
minor changes or no changes to these rules, some of them appeared to
have been significantly changed during the period of OIRA's review at
the initiative of the agencies.
Most of the Rules That OIRA Returned Were for Reconsideration:
Two of the nine rules from the selected agencies that were coded as
"returned" in the OIRA database were returned because they were
improperly submitted for review. The other seven rules were returned to
the issuing agencies for reconsideration--five rules from FAA, one from
NHTSA, and one from EPA.
In each of these seven cases, OIRA sent the rulemaking agency a "return
letter" describing its rationale for returning the rule. The letters
indicated that the returns for reconsideration were most often
triggered by OIRA concerns about the quality of agencies' regulatory
analyses or the cost-effectiveness of the proposed regulatory options.
For example:
* OIRA said it returned a proposed FAA rule on certification of pilots,
aircraft, and repairmen for the operation of light sport aircraft
because it believed that the regulatory analysis did not sufficiently
justify the rule (ID 73).
* OIRA returned another FAA draft final rule after raising questions
and concerns about the relative cost-effectiveness of requiring
additional flight data recorder parameters (ID 77).
* OIRA returned a NHTSA final rule on tire pressure monitoring systems
because, in OIRA's opinion, NHTSA's analysis did not adequately
demonstrate that the agency had selected the best available alternative
(ID 78).
* OIRA returned an EPA rule on water quality standards for Indian
country because, among other issues, EPA did not provide a quantitative
analysis of the costs and benefits that could result from this
regulatory action (ID 80).
In other cases, OIRA cited coordination issues as its rationale for the
returns. For example, in one rule OIRA suggested to FAA that a
concurrent review of the aging aircraft and corrosion control plan
rules could assist in determining the most cost-effective way to detect
and correct problems affecting aging aircraft safety (IDs 76 and 74).
In another FAA rule on Part 145 repair stations, OIRA cited concerns
from the Department of State regarding the effect of the rule on
international treaties (ID 72). (However, FAA officials told us during
our review that FAA and the Department of State had resolved these
concerns prior to the rule's submission to OIRA, so the rule might have
been returned because of a misunderstanding.)[Footnote 57] Another
factor that seems to have influenced at least some of the returns was
the 90-day limit for OIRA's reviews. In return letters for three rules,
OIRA specifically mentioned the need for additional time to resolve
some of its issues and comments as part of the explanation for
returning draft rules for reconsideration.
As of May 2003, five of the seven rules that OIRA returned for
reconsideration by the rulemaking agencies had been resubmitted by the
agencies, completed another review by OIRA, and were published in the
Federal Register. Publication of one other rule--FAA's proposed
revision of digital flight data recorder regulations--was still
pending, according to FAA officials, but EPA had not resubmitted its
proposed rule on federal water quality standards for Indian country to
OIRA.
Agencies, Not OIRA, Initiated Most Withdrawals:
Neither OIRA nor the regulatory agencies are required to document why
rules are withdrawn from OIRA's review. Therefore, we relied primarily
on testimonial evidence from agency officials to determine whether the
five rules within the scope of our review had been withdrawn at the
suggestion of OIRA or OMB. We determined that only one of the five
rules appeared to have been withdrawn at OIRA's initiative--FAA's Part
145 Review rule on repair stations (ID 84). FAA's docket included a
chronology of developments regarding this rule with an entry stating
that OIRA instructed the agency to withdraw the rule. FAA officials
explained that OIRA suggested this withdrawal due to "concerns from
industry and the State Department."[Footnote 58] (As noted previously,
OIRA representatives told us they do not request that agencies withdraw
rules, and emphasized that it is the agencies--not OIRA--that
ultimately make withdrawal decisions. However, they also said that
agencies sometimes withdraw rules as a negotiating strategy.):
Agency officials characterized two of the withdrawals as "mutual
decisions" made by their agencies and OIRA. In one of these cases, an
APHIS rule on importation of clementines from Spain, an agency official
said that the rule was withdrawn pending the close of a comment period
on a related document published by the agency, because keeping the rule
at OIRA until then would have taken OIRA's review period beyond 90 days
(ID 81). (It was resubmitted about a month later and subsequently coded
"consistent with change.") In the other case, an FDA rule on records
and reports concerning new animal drugs, the agency officials
characterized the mutual decision as a compromise to address the fact
that the old proposed rule was "stale" (ID 82). (The rule was later
published as an "interim final" rule to permit additional public
comment without having to restart the rulemaking at the proposed rule
stage.) The remaining two rules--an FDA proposed rule concerning
dietary ingredients and supplements and a NHTSA rule on light truck
fuel economy standards--were withdrawn solely at the initiative of the
agency or its executive department (IDs 83 and 85). All five of the
withdrawn rules that we examined were subsequently resubmitted to OIRA
by the agencies and were later characterized by the office as
consistent with the executive order.
Rules from FAA and EPA's Office of Air and Radiation and Office of
Water Were More Often Significantly Affected by OIRA:
As table 3 shows, when the results for all the changed, returned, or
withdrawn rules are combined, it is clear that the rules submitted by
FAA and EPA's Office of Air and Radiation and Office of Water were most
often significantly affected by OIRA's review. During the period
covered by our review, about 56 percent of the rules from these
agencies (20 of 36) were significantly affected. In contrast, only
about 10 percent of the rules from the remaining six agencies (5 of 49)
were significantly affected by OIRA's review.
Table 3: Rules from FAA and EPA's Office of Air and Radiation and
Office of Water Were Most Often Significantly Affected by OIRA Review:
Agency: APHIS; Rules submitted to OIRA for executive order review:
Total: 13; Rules submitted to OIRA for executive order review:
Significantly affected by OIRA: Number: 2; Rules submitted to OIRA for
executive order review: Significantly affected by OIRA: Percent: 15.
Agency: FDA; Rules submitted to OIRA for executive order review: Total:
9; Rules submitted to OIRA for executive order review: Significantly
affected by OIRA: Number: 0; Rules submitted to OIRA for executive
order review: Significantly affected by OIRA: Percent: 0.
Agency: OSHA; Rules submitted to OIRA for executive order review:
Total: 5; Rules submitted to OIRA for executive order review:
Significantly affected by OIRA: Number: 0; Rules submitted to OIRA for
executive order review: Significantly affected by OIRA: Percent: 0.
Agency: DOT-FAA; Rules submitted to OIRA for executive order review:
Total: 12; Rules submitted to OIRA for executive order review:
Significantly affected by OIRA: Number: 6; Rules submitted to OIRA for
executive order review: Significantly affected by OIRA: Percent: 50.
Agency: DOT-FMCSA; Rules submitted to OIRA for executive order review:
Total: 6; Rules submitted to OIRA for executive order review:
Significantly affected by OIRA: Number: 0; Rules submitted to OIRA for
executive order review: Significantly affected by OIRA: Percent: 0.
Agency: DOT-NHTSA; Rules submitted to OIRA for executive order review:
Total: 7; Rules submitted to OIRA for executive order review:
Significantly affected by OIRA: Number: 2; Rules submitted to OIRA for
executive order review: Significantly affected by OIRA: Percent: 29.
Agency: EPA-Office of Air and Radiation; Rules submitted to OIRA for
executive order review: Total: 15; Rules submitted to OIRA for
executive order review: Significantly affected by OIRA: Number: 7;
Rules submitted to OIRA for executive order review: Significantly
affected by OIRA: Percent: 47.
Agency: EPA-Office of Solid Waste and Emergency Response; Rules
submitted to OIRA for executive order review: Total: 9; Rules submitted
to OIRA for executive order review: Significantly affected by OIRA:
Number: 1; Rules submitted to OIRA for executive order review:
Significantly affected by OIRA: Percent: 11.
Agency: EPA-Office of Water; Rules submitted to OIRA for executive
order review: Total: 9; Rules submitted to OIRA for executive order
review: Significantly affected by OIRA: Number: 7; Rules submitted to
OIRA for executive order review: Significantly affected by OIRA:
Percent: 78.
Agency: Total; Rules submitted to OIRA for executive order review:
Total: 85; Rules submitted to OIRA for executive order review:
Significantly affected by OIRA: Number: 25; Rules submitted to OIRA for
executive order review: Significantly affected by OIRA: Percent: 29.
Source: GAO analysis.
[End of table]
OIRA representatives suggested that the differences in the extent to
which OIRA significantly affected agencies' rules might actually be a
function of differences in the importance or impact of the rules
submitted--not whether they are from one agency or another. The
representatives said that OIRA typically spends more time and effort
reviewing economically significant rules that are likely to have the
biggest impact on society. Therefore, they indicated that agencies like
EPA that produce a number of economically significant rules were more
likely to have their rules significantly affected by OIRA's review than
agencies like FDA that did not submit as many economically significant
rules.
As table 4 shows, 14 of the 85 rules that we examined were economically
significant. We concluded that 5 of those 14 rules (36 percent) had
been significantly affected by OIRA's review. In comparison, we
concluded that 20 of the 71 rules that were not economically
significant (28 percent) had been significantly affected by OIRA's
review. Therefore, although OIRA was slightly more likely to have had a
major effect on economically significant rules than other rules, the
difference was not statistically significant.[Footnote 59]
Table 4: OIRA Was Only Slightly More Likely to Significantly Affect
Economically Significant Rules:
Type of rule:
Type of rule: Economically significant; Rules submitted to OIRA for
executive order review: Total: 14; Rules submitted to OIRA for executive order
review: Significantly affected by OIRA: Number: 5; Rules submitted to
OIRA for executive order review: Significantly affected by OIRA:
Percent: 36.
Type of rule: Not economically significant; Rules submitted to OIRA for executive
order review: Total: 71; Rules submitted to OIRA for executive order
review: Significantly affected by OIRA: Number: 20; Rules submitted to
OIRA for executive order review: Significantly affected by OIRA:
Percent: 28.
Total; Rules submitted to OIRA for executive order review: Total: 85;
Rules submitted to OIRA for executive order review: Significantly
affected by OIRA: Number: 25; Rules submitted to OIRA for executive
order review: Significantly affected by OIRA: Percent: 29.
Source: GAO analysis.
[End of table]
Notably, all six of the FAA rules that OIRA significantly affected were
not economically significant. Of the 14 EPA Office of Air and Radiation
and Office of Water rules that OIRA significantly affected, only 3 were
economically significant.
OIRA Affected the Costs and Benefits or Estimates in Some Rules:
In 22 of the 25 rules that we concluded had been significantly affected
by OIRA's suggestions or recommendations, OIRA appeared to have
influenced either (1) the expected costs and/or benefits of the rules
and/or (2) the agencies' estimates of those costs and/or benefits. The
focus of OIRA's changes in most of these cases appeared to be on
reducing the costs and regulatory burdens, improving the cost-
effectiveness of the rules, and/or yielding greater net benefits. This
focus is consistent with the emphasis in Executive Order 12866 and the
related "best practices" document and guidance on improving regulatory
net benefits and cost-effectiveness and minimizing the cost burden of
regulation.
OIRA-Suggested Changes That Appeared to Have Affected Costs and
Benefits:
In at least 12 rules, OIRA or OMB suggested changes to the regulatory
text that could reasonably be expected to affect the potential costs
and/or benefits of the regulations. Sometimes there was direct evidence
in the docket materials of those effects. For example:
* In an EPA Office of Water proposed rule on pollutant discharge
elimination systems for large cooling water intake structures at
existing power generating facilities, OIRA recommended that the agency
select a regulatory alternative that it believed would yield
substantially greater net benefits (ID 68). The approach that EPA
originally proposed would have cost an estimated $610 million per year,
with estimated benefits of $890 million per year, yielding net benefits
of $280 million. However, OIRA recommended that EPA select another
approach that, while having estimated benefits of $735 million, was
expected to cost only $280 million, yielding net benefits of $455
million.
* In another example, an APHIS rule regarding foot-and-mouth disease,
OMB suggested changes in the indemnity payments that were, in turn,
reflected in the agency's revised estimates of the rule's costs and
benefits (ID 12).
However, in most of the cases in which OIRA suggested changes to
regulatory text, the documentary evidence of how those changes affected
the rules' costs and/or benefits was more limited and less clear. In
some cases the rules at issue were not "economically significant," so
the regulatory agencies were not required to prepare formal
quantitative assessments of the rules' expected costs or benefits. In
another case, the agency prepared those assessments but did not include
complete copies of the original and revised versions of the cost and
benefit estimates in the regulatory dockets. Therefore, we were unable
to compare the agencies' estimates to determine the effect of the OIRA-
suggested changes in the regulatory text.
Nevertheless, even in the absence of such documentation, we believe
that it is reasonable to assume in at least some cases that the OIRA-
suggested elimination or delay of certain regulatory provisions in the
text of draft rules as submitted to OIRA would also eliminate or delay
the expected costs and/or benefits associated with those provisions.
The following are examples of OIRA suggested changes in regulatory text
that appeared to affect the rules' expected costs and/or benefits:
* APHIS revised the regulatory text in a proposed rule on payment of
indemnity for animals affected by foot-and-mouth disease to eliminate
compensation coverage for certain voluntary actions taken by owners of
animals, thereby reducing potential costs to the federal government (ID
12). However, according to an APHIS official (and as explained in the
preamble of the proposed rule), not providing compensation for the care
and feeding of "official vaccinates" that could be used as a "fire
wall" around infected animals to help prevent the spread of the
disease, and eliminating compensation for cleaning and disinfecting
non-susceptible animals that could spread the disease even if they
cannot themselves become infected, could impede eradication efforts,
thus reducing overall benefits to society.[Footnote 60]
* EPA changed the regulatory text in a final rule regarding cooling
water intake structures at new facilities to provide regulated entities
the flexibility to use more alternatives or exceptions to compliance
with the rule's requirements and standards (ID 65). These changes could
reasonably be expected to reduce at least some of the regulated
entities' costs of compliance with those requirements and standards,
without any documented change in benefits.
* EPA deferred final action on adding manganese to the list of
hazardous waste constituents, thereby also deferring the potential
costs and benefits of designating manganese as a hazardous waste
constituent, with an unknown effect on net benefits (ID 56).
* EPA delayed compliance dates in two provisions of a proposed rule
setting national emission standards for hazardous air pollutants from
surface coating of wood building products, thereby producing
corresponding delays in the costs and benefits expected for the rule
(ID 51).
OIRA-Suggested Changes that Affected Agencies' Estimates of Costs and
Benefits:
In 14 rules (including some of the ones described above with regulatory
text changes), OIRA specifically commented on and requested changes in
the agencies' analyses of the economic impacts of the draft
regulations. Six of the seven rules that OIRA returned to agencies for
reconsideration fell into this category. Although OIRA sometimes
suggested revisions in existing estimates and calculations, OIRA more
often suggested changes that added or clarified information and
analysis presented on a draft rule's economic impacts. For example:
* EPA responded to OIRA comments and suggestions by revising cost-
benefit and cost-effectiveness estimates for a proposed rule regarding
emissions from spark-ignition marine vessels and highway motorcycles
(ID 54). As a result of the changes, the estimated annual costs to
manufacturers were reduced by $4 million and the estimated annual fuel
savings to the public were increased by $4.3 million.
* OIRA returned an FAA proposed rule on certification of pilots,
aircraft, and repairmen for the operation of light sport aircraft with
a request that the agency prepare additional revised analyses of the
potential impacts (ID 73). OIRA's comments focused on the analytical
baseline FAA had used and the regulatory alternatives presented. Among
other things, OIRA suggested that, as part of an improved analysis of
alternatives, FAA could consider means of improved compliance and
enforcement of regulations currently in place.
* At OIRA's suggestion, NHTSA inserted additional estimates of some
costs and benefits of regulatory alternatives (e.g., adding estimates
of the total estimated costs of the proposed alternatives, where the
original draft only provided estimates of average cost per vehicle),
added additional information about the potential range of injuries and
deaths prevented and other benefits that might be realized with
different regulatory alternatives, and identified unquantified
benefits and costs that might be associated with its proposed rule on
tire pressure monitoring systems (ID 36).
A Focus on Costs, Cost-Effectiveness, and Net Benefits:
In general, the focus of OIRA's changes in most of these cases appeared
to be on reducing costs and regulatory burdens, improving the cost-
effectiveness of the rules, or maximizing the rules' net benefits. For
example, OIRA returned six rules for reconsideration because of
concerns that the agencies' analyses had not adequately captured all
economic effects of the rules or presented regulatory options that OIRA
did not believe were cost-effective. In the changed rules, reducing
costs or improving cost-effectiveness was sometimes accomplished by
suggesting additional, more flexible regulatory options, but it was not
always clear whether reductions in costs would necessarily be
accompanied by increases in net benefits to society. For example, in
response to an OIRA suggestion, EPA eliminated a regulatory provision
requiring a minimum net reduction if steel facilities used a voluntary
pollutant trading mechanism called a "water bubble (ID 71)." EPA's
original draft rule noted that the mechanism had been structured in a
way to produce an additional benefit because the amount of the
pollutant discharges pursuant to the bubble had to be 10-percent to 15-
percent less than the discharges otherwise authorized by the rule
without the bubble. However, eliminating this minimum net reduction
requirement might encourage more regulated entities to use this
voluntary mechanism to comply with the standards of the rule at lower
cost. The potential change in net benefits to society is therefore not
clear.
Although attention to the cost side of economic effects was most
prevalent in OIRA's comments and suggestions, in at least four cases
OIRA also suggested specific changes in agencies' estimated benefits of
their rules. OIRA suggested several changes regarding the benefits
estimates of NHTSA's proposed tire pressure monitoring system rule, in
particular inserting additional information about benefit estimates,
such as the range of injuries and deaths prevented, stopping distance
effects, and average tire life increases (ID 36). OIRA also suggested
adding a discussion on the effect of human factors on the benefits of
tire pressure monitoring systems. When OIRA returned NHTSA's draft
final rule on tire pressure monitoring systems, the office stated that
the technical foundation for NHTSA's estimates of safety benefits
needed to be better explained and subjected to sensitivity analysis (ID
78). OIRA also questioned some of EPA's estimates of the environmental
impacts associated with a proposed rule on emissions from nonroad large
spark-ignition engines and recreational engines (ID 41). In an
indemnity program to address chronic wasting disease (CWD) in cervids
(antler-bearing animals, such as elk and deer), OIRA asked APHIS to
avoid citing as a benefit the avoidance of disease in humans caused by
CWD because this possibility was considered remote by a Harvard risk
analysis (ID 9).
There were also cases in which OIRA did not directly affect the
expected costs or benefits of a rule but nevertheless suggested changes
to an agency's discussion of the rule's costs and benefits. In 19 such
rules that were changed after submission, OIRA suggested clarification
or revision of the information presented in the rule about estimated
costs and benefits or how they were calculated, solicited comments on a
regulatory agency's cost-benefit estimates, or requested comments on
ways to make a regulation more cost-effective or less costly and
burdensome. (At least 2 of the 22 rules that we identified as having
costs and/or benefits directly affected by OIRA's actions also had such
clarifications or requests for comments inserted at OIRA's
suggestion.):
Again, many of OIRA's comments and suggested changes were focused on
the costs of the proposed regulatory actions, although in these cases
OIRA's suggestions most often helped to clarify the potential costs of
regulatory alternatives or how an agency had estimated those costs. In
at least seven rules, OIRA specifically suggested that agencies solicit
public comments and data on the potential costs and burdens of proposed
regulations or suggestions for alternative regulatory options that
would be more cost-effective or less burdensome. By focusing attention
and soliciting comments on cost and burden issues, particularly at the
proposed rule stage, these revisions to preamble language might prompt
changes in the costs and benefits of the rules in future iterations of
the rules.
Appendix II includes more detailed information on the extent to which
OIRA's regulatory reviews had an effect on the potential costs and
benefits of individual rules within the scope of our report.
Outside Parties Contacted OIRA Regarding about Half of the Rules OIRA
Significantly Affected:
Another part of this objective was to determine whether there was any
evidence that the actions that OIRA took (e.g., to suggest significant
changes to rules or to return them to the agencies for reconsideration)
were traceable to suggestions offered by regulated entities or other
parties outside of the federal government. It is not possible to
independently determine what motivated OIRA's actions with regard to
any of the rules that it reviewed. However, we did identify a number of
instances in which outside parties directly contacted OIRA regarding
rules that OIRA later significantly affected. Those direct contacts
took the form of either a meeting with OIRA representatives or a letter
sent to OIRA before or during the period of OIRA's review.[Footnote 61]
We also identified similarities between the actions that OIRA suggested
or recommended to the agencies and those advocated to OIRA by outside
parties through those direct contacts.
Outside parties directly contacted OIRA regarding 11 of the 25 rules
that OIRA significantly affected--8 of the rules that were
significantly changed as a result of OIRA's suggestions or
recommendations, 2 of the rules that OIRA returned to the agencies for
reconsideration, and the 1 withdrawal that was made at OIRA's request.
As figure 10 shows, 8 of these 11 rules were from EPA, FAA submitted 2
of the rules, and 1 was a NHTSA submission.[Footnote 62] In all 11
cases, representatives of regulated entities were involved in those
contacts with OIRA. In 3 of the 11 cases, environmental and other
public interest groups also contacted OIRA about the rules.
Figure 10: Outside Parties Most Often Contacted OIRA Regarding EPA
Rules:
[See PDF for image]
[End of figure]
In 7 of the 11 cases where there was direct contact with OIRA by
outside parties, at least some of the actions that OIRA recommended or
took appeared to be similar to those suggested to OIRA by regulated
parties. (OIRA did not recommend changes that were similar to all of
the changes suggested by the regulated entities.) Environmental or
other public interest groups had also directly contacted OIRA in 3 of
these 7 cases, but OIRA's actions did not appear to be similar to the
suggestions offered by those groups. Examples of the 7 cases include
the following:
* As a result of its review of an EPA Office of Water rule on cooling
water intake structures at existing power-generating facilities, OIRA
suggested changes that lowered the draft performance standard and added
compliance flexibility to the rule by allowing, among other things,
options for a site-specific approach to minimizing environmental harm
(ID 68). Some of OIRA's suggested revisions of the regulatory language
were similar to those proposed by representatives of the electric
industry--in particular, the site-specific approach--during their
contacts with OIRA regarding this rule. (The representatives of the
electric industry also proposed other changes to this rule that OIRA
did not recommend to EPA.) Representatives of an environmental interest
group also contacted OIRA regarding this rule, advocating that EPA's
regulations be based on nationally uniform standards and not on case-
by-case, site-specific determinations.
* During its review of an EPA final rule on identification and listing
of hazardous waste, industry representatives from steel manufacturers
and a chemical company sent letters and met with OIRA opposing the
listing of manganese as a hazardous waste constituent due to concerns
about the costs that the rule would impose on certain facilities (ID
56). Industry representatives had raised similar points in the public
comments they submitted during the proposed rule stage of this
rulemaking, but EPA was not persuaded to revise its draft of the final
rule after considering those comments. The main focus of OIRA's
extensive changes in this rule was the deferral of final action on all
parts of the draft rule that would have identified manganese as a
hazardous contaminant, as in the original proposed rule and EPA's draft
final rule.
* In a draft final rule on tire pressure monitoring systems, NHTSA
included provisions that would eventually have mandated use of direct
sensing technologies, rather than indirect technologies, for such
systems (ID 78).[Footnote 63] Representatives of automobile
manufacturers contacted OIRA to raise concerns that "the structure of
the final rule will have the effect of eliminating indirect tire
pressure monitoring systems as a compliance option." They also argued
that there was no evidence that safety benefits would be noticeably
different between systems using indirect and direct sensing
technologies. OIRA returned this rule to NHTSA for reconsideration,
citing as its reason that the agency's analysis did not adequately
demonstrate that NHTSA had selected the best available option and
raising concerns regarding NHTSA's analysis of the safety impacts of
regulatory alternatives. OIRA subsequently completed a review
(consistent with no change) of NHTSA's resubmitted version of the rule
(with a revised analysis of safety issues, costs, and benefits of
direct and indirect system alternatives) that allowed either type of
sensing technology through a phase-in period and deferred until 2005 a
decision on which performance standards would be effective after 2006.
However, it is impossible to determine the extent to which the
suggestions made by the regulated parties might have influenced OIRA's
actions, if at all. OIRA might have independently reached the same
conclusions or had the same concerns even if the regulated entities had
not contacted OIRA. An OMB representative told us that in many of these
meetings outside parties have raised issues that had already been
expressed in public comments, meetings between the outside parties and
the regulatory agencies, trade papers, news articles, and other venues-
-all of which might have been reviewed by OIRA.
On the other hand, in 4 of the 11 cases in which regulated parties
directly contacted OIRA, OIRA's actions or suggestions to the agencies
did not appear to be similar to the actions or suggestions that the
regulated parties advocated. Examples of these cases include the
following:
* Representatives of the steel industry contacted OIRA regarding an EPA
final rule on effluent limitations guidelines, pretreatment standards,
and new source performance standards for the iron and steel
manufacturing point source category (ID 71). In the letter requesting a
meeting with the OIRA Administrator, the steel industry representatives
asserted that EPA's revised effluent limitation guidelines were not
technically, economically, or legally justified, and also raised
concerns about specific aspects of EPA's benefit-cost analysis. The
only substantive change that OIRA suggested in this rule, however, was
to eliminate a preexisting "minimum net reduction" provision in
regulations that applied if facilities used a "water bubble"
alternative mechanism for trading pollutants.
* Similarly, representatives from a number of regulated parties
requested that OIRA return FAA's draft final rule on part 145 repair
stations to the agency with instructions to prepare a supplemental
notice of proposed rulemaking and essentially restart most of the
rulemaking process (IDs 84 and 72). However, OIRA's actions to have the
agency withdraw the rule and, later, to return the rule to the agency
for reconsideration cited issues unrelated to those voiced by the
regulated entities. When FAA resubmitted the same draft rule a third
time, OIRA completed its review of the rule with an outcome of
"consistent with no change." An industry representative that we
interviewed said that the industry groups ultimately did not get the
changes in the rule that they wanted from OIRA.
Appendix III contains case studies that provide more detailed
information about each of the rules for which we found evidence that
outside parties had contacted OIRA.
OIRA Generally Disclosed Outside Contacts:
As noted in chapter 2 of this report, Executive Order 12866 requires
OIRA to maintain a publicly available log containing the dates and
names of those involved in substantive oral communications (e.g.,
telephone calls or meetings) between OIRA personnel and outside parties
and the subject matter discussed. We used the OIRA list of substantive
outside communications to help us identify the information presented
above and examined other material to identify those contacts, including
agencies' rulemaking dockets.
Overall, we identified only two meetings that OIRA had with outside
parties and two letters to OIRA from outside parties regarding the
rules in our review that OIRA had not disclosed at the time of our
review:
* The OIRA docket contained a letter indicating that OIRA had met in
October 2001 with representatives from the iron and steel industry in
relation to an EPA draft rule that would have added manganese to a list
of hazardous waste constituents (ID 56). However, when we examined
OIRA's meeting log in early 2003 there was no record of this meeting.
(OIRA subsequently added this meeting to its on-line meeting log.):
* A July 2001 letter sent to OIRA in relation to the FAA part 145 rule
was included as part of a regulated entity's testimony before a
congressional committee (IDs 84 and 72). However, OIRA's docket did not
contain a copy of this correspondence at the time of our review. (OIRA
subsequently added this letter to its docket.):
* EPA's docket included a February 2002 letter from the Center for
Energy and Economic Development to the OIRA Administrator regarding
revisions to a regional haze rule (ID 48).[Footnote 64] However, we did
not find a copy of this letter in OIRA's docket. EPA's docket for this
rule also included a copy of an e-mail message from OIRA to EPA noting
that a meeting at OMB had been scheduled at the Center's request for
February 5, 2002. However, we did not find documentation for this
meeting during our review of OIRA's dockets and logs. (OIRA's docket
did contain a copy of a letter from another outside party regarding
this rule.):
However, we have no way of knowing whether there were other meetings
with outside parties or other letters from those parties about rules in
our review that did not come to our attention. Our knowledge of such
meetings or correspondence is generally limited to what OIRA or the
agencies disclose in their files. OIRA representatives told us that
some of the letters mailed to OIRA after the events of September 11,
2001, and the anthrax letters in October 2001 may not have been
delivered, and said they were committed to disclosing all outside
contacts regarding rules under review.
Documentation of OIRA's Reviews Varied, but Some Agencies' Practices
Improved Transparency:
Agencies varied in the extent to which they satisfied the documentation
requirements in Executive Order 12866, but most of the agencies
satisfied those requirements for most of their rules. However, having
materials in the agencies' rulemaking dockets does not necessarily mean
that OIRA's effects on the rules were fully transparent. The executive
order also requires OIRA to disclose certain information about its
review process, and we concluded that OIRA generally satisfied those
requirements regarding the rules that we reviewed.
Agencies Varied in Extent to Which Documentation Requirements Were
Satisfied:
One of the stated purposes of Executive Order 12866 is to make the
federal rulemaking process more accessible and open to the public.
Toward that end, the executive order places certain public disclosure
and documentation requirements on regulatory agencies or OIRA. However,
some types of actions are not covered by these requirements and,
therefore, do not have to be disclosed or documented by either party.
Also, in some cases the executive order does not clearly indicate what
must be disclosed or documented.
In general, the applicability and nature of the disclosure and
documentation requirements in the executive order depends on the
outcome of OIRA's review. If an agency withdraws a rule from OIRA's
review, neither the agency nor OIRA are required to disclose the
reason. However, if OIRA returns a rule to an agency for
reconsideration, section 6(b)(3) of the executive order requires the
OIRA Administrator to provide the issuing agency with a written
explanation delineating the pertinent section of the order on which
OIRA is relying. For rules that OIRA reviews and are subsequently
published in the Federal Register, the executive order requires
agencies to make the rule and any cost or benefit information prepared
available to the public. Two other sections of the order establish
specific documentation requirements regarding changes made to rules
submitted to OIRA for review:
* Section 6(a)(3)(E)(ii) of the order states that agencies must
"identify for the public, in a complete, clear, and simple manner, the
substantive changes between the draft submitted to OIRA for review and
the action subsequently announced." However, neither the executive
order nor OIRA's October 1993 guidance on its implementation defines
what the term "substantive changes" means.
* Section 6(a)(3)(E)(iii) of the order requires agencies to "identify
for the public those changes in the regulatory action that were made at
the suggestion or recommendation of OIRA.":
OIRA's October 1993 guidance on the implementation of the order
considers the second requirement to be a subset of the first.
Therefore, under this interpretation, the agencies are only required to
identify the changes made at OIRA's suggestion or recommendation after
formal submission of the rule to OIRA--not during any informal review
period that precedes formal submission. OIRA also took this position in
response to recommendations in our 1998 report on the implementation of
these transparency requirements and during this review. This
distinction is important because, in some of the 25 rules that we
concluded had been significantly changed at OIRA's suggestion or
recommendation, OIRA suggested significant changes prior to formal
submission of the rule to OIRA. Also, some of the rules that were
reviewed informally for weeks or months had very short formal review
periods--in some cases as little as a few days.
To determine agencies' compliance with these documentation
requirements, we considered the required information to have been
"identified for the public" if it was available in the agencies' public
docket for the relevant rule. We coded the level of documentation in
the agencies' dockets for each changed rule into one of four
categories, reflecting whether (1) all changes were clearly documented,
(2) changes were identified but it was not clear that all changes had
been documented or at whose initiative, (3) no changes were documented
in the agencies' public rulemaking docket, or (4) the Executive Order
12866 documentation requirements were not applicable.[Footnote 65] The
first requirement is not applicable when there were no changes made to
the rule during OIRA's review that the agencies considered
"substantive." Even if there were substantive changes made during
OIRA's review, the second requirement is not applicable if those
changes were not made at the suggestion or recommendation of OIRA. We
made our determinations regarding agencies' compliance with these
requirements solely on the basis of the information that would be
available to a member of the public if he/she had reviewed the docket
for a given rule.[Footnote 66] Furthermore, because the executive order
places responsibility to document changes on the agencies rather than
OIRA, our determinations only reflect material available in the
regulatory agencies' dockets, not materials in OIRA's public
files.[Footnote 67] Table 5 presents the results of our analysis of
agencies' compliance with both documentation requirements in the
executive order.
Table 5: Agencies' Compliance with Executive Order 12866 Documentation
Requirements Was Mixed:
Agency: APHIS; Changes made during OIRA review period: All changes
clearly identified: 1; Changes made during OIRA review period: Not
clear that all changes had been identified: 8; Changes made during OIRA
review period: No changes identified in docket: 0; Changes made during
OIRA review period: Not applicable: 3; Changes made at OIRA's
suggestion or recommendation: All changes clearly identified: 4;
Changes made at OIRA's suggestion or recommendation: Not clear that all
changes had been identified: 5; Changes made at OIRA's suggestion or
recommendation: No changes identified in docket: 0; Changes made at
OIRA's suggestion or recommendation: Not applicable: 3; Total number of
changed rules: 12.
Agency: FDA; Changes made during OIRA review period: All changes
clearly identified: 7; Changes made during OIRA review period: Not
clear that all changes had been identified: 0; Changes made during OIRA
review period: No changes identified in docket: 0; Changes made during
OIRA review period: Not applicable: 0; Changes made at OIRA's
suggestion or recommendation: All changes clearly identified: 6;
Changes made at OIRA's suggestion or recommendation: Not clear that all
changes had been identified: 0; Changes made at OIRA's suggestion or
recommendation: No changes identified in docket: 0; Changes made at
OIRA's suggestion or recommendation: Not applicable: 1; Total number of
changed rules: 7.
Agency: OSHA; Changes made during OIRA review period: All changes
clearly identified: 0; Changes made during OIRA review period: Not
clear that all changes had been identified: 0; Changes made during OIRA
review period: No changes identified in docket: 4; Changes made during
OIRA review period: Not applicable: 1; Changes made at OIRA's
suggestion or recommendation: All changes clearly identified: 0;
Changes made at OIRA's suggestion or recommendation: Not clear that all
changes had been identified: 0; Changes made at OIRA's suggestion or
recommendation: No changes identified in docket: 2; Changes made at
OIRA's suggestion or recommendation: Not applicable: 3; Total number of
changed rules: 5.
Agency: DOT/FAA; Changes made during OIRA review period: All changes
clearly identified: 0; Changes made during OIRA review period: Not
clear that all changes had been identified: 0; Changes made during OIRA
review period: No changes identified in docket: 2; Changes made during
OIRA review period: Not applicable: 3; Changes made at OIRA's
suggestion or recommendation: All changes clearly identified: 0;
Changes made at OIRA's suggestion or recommendation: Not clear that all
changes had been identified: 0; Changes made at OIRA's suggestion or
recommendation: No changes identified in docket: 2; Changes made at
OIRA's suggestion or recommendation: Not applicable: 3; Total number of
changed rules: 5.
Agency: DOT/FMSCA; Changes made during OIRA review period: All changes
clearly identified: 4; Changes made during OIRA review period: Not
clear that all changes had been identified: 0; Changes made during OIRA
review period: No changes identified in docket: 0; Changes made during
OIRA review period: Not applicable: 2; Changes made at OIRA's
suggestion or recommendation: All changes clearly identified: 2;
Changes made at OIRA's suggestion or recommendation: Not clear that all
changes had been identified: 0; Changes made at OIRA's suggestion or
recommendation: No changes identified in docket: 0; Changes made at
OIRA's suggestion or recommendation: Not applicable: 4; Total number of
changed rules: 6.
Agency: DOT/NHTSA; Changes made during OIRA review period: All changes
clearly identified: 0; Changes made during OIRA review period: Not
clear that all changes had been identified: 1; Changes made during OIRA
review period: No changes identified in docket: 0; Changes made during
OIRA review period: Not applicable: 4; Changes made at OIRA's
suggestion or recommendation: All changes clearly identified: 1;
Changes made at OIRA's suggestion or recommendation: Not clear that all
changes had been identified: 0; Changes made at OIRA's suggestion or
recommendation: No changes identified in docket: 0; Changes made at
OIRA's suggestion or recommendation: Not applicable: 4; Total number of
changed rules: 5.
Agency: EPA Office of Air and Radiation; Changes made during OIRA
review period: All changes clearly identified: 1; Changes made during
OIRA review period: Not clear that all changes had been identified: 9;
Changes made during OIRA review period: No changes identified in
docket: 1; Changes made during OIRA review period: Not applicable: 3;
Changes made at OIRA's suggestion or recommendation: All changes
clearly identified: 2; Changes made at OIRA's suggestion or
recommendation: Not clear that all changes had been identified: 7;
Changes made at OIRA's suggestion or recommendation: No changes
identified in docket: 1; Changes made at OIRA's suggestion or
recommendation: Not applicable: 4; Total number of changed rules: 14.
Agency: EPA Office of Solid Waste and Emergency Response; Changes made
during OIRA review period: All changes clearly identified: 2; Changes
made during OIRA review period: Not clear that all changes had been
identified: 3; Changes made during OIRA review period: No changes
identified in docket: 0; Changes made during OIRA review period: Not
applicable: 4; Changes made at OIRA's suggestion or recommendation: All
changes clearly identified: 5; Changes made at OIRA's suggestion or
recommendation: Not clear that all changes had been identified: 0;
Changes made at OIRA's suggestion or recommendation: No changes
identified in docket: 0; Changes made at OIRA's suggestion or
recommendation: Not applicable: 4; Total number of changed rules: 9.
Agency: EPA Office of Water; Changes made during OIRA review period:
All changes clearly identified: 8; Changes made during OIRA review
period: Not clear that all changes had been identified: 0; Changes made
during OIRA review period: No changes identified in docket: 0; Changes
made during OIRA review period: Not applicable: 0; Changes made at
OIRA's suggestion or recommendation: All changes clearly identified: 8;
Changes made at OIRA's suggestion or recommendation: Not clear that all
changes had been identified: 0; Changes made at OIRA's suggestion or
recommendation: No changes identified in docket: 0; Changes made at
OIRA's suggestion or recommendation: Not applicable: 0; Total number of
changed rules: 8.
Agency: Total; Changes made during OIRA review period: All changes
clearly identified: 23; Changes made during OIRA review period: Not
clear that all changes had been identified: 21; Changes made during
OIRA review period: No changes identified in docket: 7; Changes made
during OIRA review period: Not applicable: 20; Changes made at OIRA's
suggestion or recommendation: All changes clearly identified: 28;
Changes made at OIRA's suggestion or recommendation: Not clear that all
changes had been identified: 12; Changes made at OIRA's suggestion or
recommendation: No changes identified in docket: 5; Changes made at
OIRA's suggestion or recommendation: Not applicable: 26; Total number
of changed rules: 71.
Source: GAO analysis.
[End of table]
For the rules where the requirements were applicable, the results were
mixed. As discussed in more detail later in this report, some agencies
(FDA, FMCSA, and EPA's Office of Water) provided clear documentation in
their rulemaking dockets of all of the changes made to their rules
during OIRA's review and at OIRA's suggestion or recommendation. In
contrast, other agencies (FAA and OSHA) did not have any documentation
of the changes made in their dockets. FAA officials told us that their
agency had not been documenting changes made during OIRA's review, but
would do so in the future and put the documentation in the agency's
rulemaking docket.[Footnote 68] OSHA officials said the documentation
was available from the Office of the Solicitor, and said that if a
member of the public wanted information on changes made during OIRA's
review it would be provided upon specific request. (OSHA officials said
that they keep the information in the Office of the Solicitor in order
to ensure that the OIRA-directed change documentation is not part of
the official rulemaking record if a lawsuit is filed.) However, because
there is nothing in the OSHA rulemaking docket to identify that
documentation of OIRA changes exists or is available, a member of the
public interested in finding this information would have to know to
specifically request the relevant documentation from the Office of the
Solicitor.
For the remaining agencies (APHIS, NHTSA, and EPA's Offices of Air and
Radiation and Solid Waste and Emergency Response), it was unclear that
the documentation available in the dockets covered all of the relevant
changes to their rules. For example, these agencies sometimes included
in their dockets copies of e-mails between OIRA and the agencies
discussing changes that had been made to the draft rule. However, we
could not tell whether these e-mails represented all or only some of
the changes that had been made. In other cases, agencies documented
changes made, but it was not clear if any of the changes had been at
the suggestion or recommendation of OIRA. Agency officials later told
us that, in these cases, the documentation that we found represented
all of the changes that had been made to the rules during OIRA's review
or at OIRA's initiative. Therefore, it may be that the lack of clarity
regarding these agencies' adherence to the documentation requirements
in the executive order reflected unclear or inadequate labeling and
attribution of the sources of changes, rather than the absence of
documentation.
Agencies Varied in How Changes to Draft Rules Were Documented:
Executive Order 12866 does not specify how agencies should document the
changes made to draft rules after their submission to OIRA, nor is
there any governmentwide guidance that directs agencies how to do so.
OIRA representatives told us that it is up to each agency to decide how
its rulemaking dockets are kept and how they satisfy the executive
order's requirements. Not surprisingly, therefore, the regulatory
agencies in our review had different methods of documenting changes to
the rules that OIRA reviewed under Executive Order 12866. In the cases
of DOT and EPA, which each had three agencies or program offices in our
review, the documentation practices also varied across their agencies
and offices.
How Changes Were Identified:
For example, there were clear differences among the agencies in how
they "identified for the public" the changes made to draft rules after
their submission to OIRA and at the suggestion or recommendation of
OIRA.
* The most common method was the inclusion in the public rulemaking
docket of a marked-up copy of the rule (or selected pages thereof) as
submitted to OIRA or after the review was completed showing the changes
made during the review process. In some cases these marked-up copies
were done by hand, but in other cases a "redline/strikeout" version was
prepared electronically, printed, and placed in the public docket.
Agencies with this type of documentation included FMCSA, NHTSA, and
EPA's Office of Solid Waste and Emergency Response. In addition to a
marked-up version of its rules, FDA also included a standard cover form
that identified the information placed in the dockets to address each
part of the executive order's documentation requirements.
* Some agencies' documentation included the above marked-up versions of
the rules and/or copies of e-mail messages of faxes between OIRA and
the regulatory agencies reflecting the changes that were being made to
the rules. Agencies with this type of documentation included EPA's
Office of Air and Radiation and APHIS.
* For all but one of the dockets prepared by EPA's Office of Water, the
office included a detailed memorandum addressing each of the executive
order's documentation requirements, summarizing the development and
review of the rule and identifying all substantive changes made and
those made at the suggestion of OIRA.[Footnote 69]
How Sources of Changes Were Identified:
The regulatory agencies also differed in how they identified the source
of the changes (e.g., whether the changes had been made at the
suggestion of OIRA or at the agency's initiative). Most commonly, the
agencies noted the source of the changes in the margins of their
marked-up versions of at least some of the rules (e.g., APHIS, FDA, and
FMCSA). In those cases where e-mails or faxes were used for
documentation, the sources of the changes were usually apparent from
those documents (e.g., EPA's Office of Air and Radiation). If the
agency prepared a summary memorandum (e.g., EPA's Office of Water), the
sources were usually identified in that memorandum. However, in some
cases the agencies did not clearly indicate which of the changes that
they identified were from OIRA and which were from the agencies.
Other Differences in Documentation:
Other areas in which the agencies' documentation practices differed
included the following:
* Officials in some of the agencies (e.g., APHIS, FDA, and NHTSA)
indicated that the only changes to their rules that they considered
"substantive" were those that affected the impact or text of the rule
as it appeared in the Code of Federal Regulations (although the
executive order does not specify that only changes to regulatory text
are substantive). However, in practice most of these agencies
documented both regulatory text changes and other changes to the
preambles of their rules (particularly those that we previously
identified as "other material changes" in which OIRA suggested that the
agency clarify or solicit comments on a particular issue). Other
agencies documented all changes to their rules, even those that were
editorial or otherwise minor in nature.
* Some agencies documented changes made to their rules by OIRA prior to
formal submission (e.g., EPA Office of Air and Radiation), while others
did not.
* Some of the agencies documented when there had been no substantive
changes made to their rules (e.g., EPA Office of Air and Radiation),
while others did not (e.g., FAA and NHTSA).
Some Agencies Demonstrated "Best Practices":
Overall, we often found it difficult to identify the changes that had
been made to agencies' rules during OIRA's review and/or at the
suggestion or recommendation of OIRA by reviewing material in the
agencies' rulemaking dockets. As noted previously, one agency (FAA) had
done nothing at the time of our review to document these changes, and
another agency (OSHA) placed its documentation in the Office of the
Solicitor, not the agency's rulemaking docket. (Therefore, a member of
the public would have to know to ask for the materials from that
office.) Other agencies did not document any changes if the changes
were not, in their opinion, "substantive." In another case the agency
simply provided a copy of the rule as submitted to OIRA and a copy of
the rule as published in the Federal Register, with no indication of
what had changed in the text. In still other cases, the changes were
indicated in a "redline/strikeout" version of the rule, but the
photocopied redline version was so indistinct that it was difficult to
identify or attribute all of the changes. The agencies appeared to do a
better job of documenting the changes that had been initiated by OIRA
than in clearly identifying whether other substantive changes had been
made to the rules by the agencies or other parties after submission to
OIRA. For several of the rules, the agencies added material to the
public dockets shortly before we arrived or after we told the agencies
we could not find documentation for certain rules that had been
changed. For example, FMCSA added documentation of changes made to a
rule that OIRA had finished reviewing in May 2002 after we asked about
the rule during a meeting with FMCSA officials in February 2003.
Executive Order 12866 does not specify when agencies must "identify for
the public" the changes made during OIRA's review.
In marked contrast, the documentation practices used by some of the
agencies and offices in our review--FDA, FMCSA and EPA's Office of
Water--represented what we consider to be "best practices" that not
only met the minimal requirements of the Executive Order 12866 but also
made clear how the rules had changed during OIRA's review and which
changes were made at OIRA's suggestion.
* EPA's Office of Water usually did this through detailed memoranda
prepared for the docket specifically to address the executive order's
requirements. For example, in the Office of Water's rule on proposed
changes to meat and poultry effluent limitations guidelines and
standards, EPA included a detailed cover memorandum specifically
addressing the executive order's requirements (ID 67). The memorandum
not only identified all of the substantive changes made at OIRA's
suggestion, it also identified the substantive EPA changes made
independent of other reviewers. Also, the memorandum identified
nonsubstantive changes that had been suggested by OMB and others (e.g.,
SBA and the Department of Agriculture). Copies of relevant documents
were attached to the memorandum as well as copies of suggested changes
that were sent to the agency by the OIRA desk officer.
* FMCSA often provided a "redline/strikeout" version of the revised
rule after OIRA's review, clearly annotating the changes that had been
made to the rule between submission of the manuscript to OIRA and its
publication, as well as the source of each change. For example, in
several places in the agency's interim final rule regarding a safety
monitoring system and compliance initiative for Mexico-domiciled motor
carriers operating in the United States, FMCSA identified changes that
had been made at the request of OIRA, at the request of the Office of
the Federal Register, or at FMCSA's initiative after the submission of
a previous version of the rule to OIRA (ID 32).
* FDA used a standard one-page cover form with attached copies of the
rule in which the agency had marked the changes made to the rule and
annotated the sources of those changes. The FDA form, as well as some
similar forms we found in EPA's dockets, had the additional benefit of
allowing agency officials to affirmatively indicate whether there were
substantive changes made to a rule during OIRA's review and,
separately, whether there were changes made at the suggestion or
recommendation of OIRA. For example, in the agency's draft final rule
on food additives, FDA included the cover memorandum and a copy of the
rule as submitted to OIRA with hand-written annotations of FDA and OIRA
changes (ID 17). In addition, FDA included a copy of its responses to
detailed OMB questions about the final rule.
[End of section]
Chapter 4: Many Rules Nominated for Reform Are Being Changed:
Our third objective was to describe how OIRA determined that certain
existing rules merited high priority review. With regard to OIRA's 2001
review effort, our specific objectives were to determine (a) which
organizations or persons suggested that the rules be reviewed, (b) what
process OIRA used to select and prioritize the nominations, (c) the
extent to which OIRA publicly disclosed its selection and priority-
setting process, and (d) the current status of those rules. We also
compared that review effort to a second review that OIRA initiated in
2002.
In summary, OIRA received 71 nominations from the public in response to
its May 2001 request for suggestions of rules that should be modified
or rescinded. Of these, 44 nominations were from the Mercatus Center at
George Mason University. OIRA selected 23 of the 71 nominations for
high priority review--14 of which were originally nominated by the
Mercatus Center. The only other organizations that nominated more than
one of the suggestions that OIRA so designated were the Equal
Employment Advisory Council and the Employment Policy Foundation (two
suggestions each). Representatives of OIRA told us that the office's
desk officers initially determined which issues merited high priority
review, subject to the approval by OIRA management. Although OIRA fully
disclosed the source of each of the nominations that it received and
defined the priority categories that it used, the office did not
publicly describe how it decided which nominations merited high
priority review. As of May 2003, regulatory agencies or OIRA have at
least begun to address the issues raised in many of the suggestions. In
March 2002 OIRA again solicited public comments on regulations in need
of reform, and in response received more than 300 suggestions. However,
this time OIRA forwarded the suggestions to the relevant federal
agencies for review and prioritization. In general, OIRA explained the
process used for this second round of nominations more clearly and
completely than was done for the first round.
Mercatus Center Nominated Most Rules Selected for High Priority Review
in 2001 Report:
Section 628(a)(3) of the fiscal year 2000 Treasury and General
Government Appropriations Act required OMB to submit "recommendations
for reform" with its report on the costs and benefits of federal
regulations. In the portion of its May 2001 draft report responding to
this requirement, OIRA said it did not have enough information to make
recommendations for the reform of specific regulations or regulatory
programs, and asked for recommendations and comments on rules and
regulatory programs that could be "of concern to the public."
Specifically, OIRA said the following:
"We would like to receive suggestions on specific regulations that
could be rescinded or changed that would increase net benefits to the
public by either reducing costs and/or increasing benefits. We would
appreciate if commenters identified regulations that are obsolete or
outmoded, and could be rescinded or updated.":
OIRA asked that commenters provide their suggestions in a particular
format (e.g., name of regulation, agency regulating, citation, and
description of problem) and invited commenters to suggest "any other
reforms to the regulatory development and oversight processes that
would improve regulatory outcomes.":
In its December 2001 final report, OIRA said it received 71 suggestions
in response to its request from 33 commentators involving 17 agencies.
In an appendix to the report listing the suggestions, OIRA indicated
that 44 of them came from the Mercatus Center at George Mason
University. The report also indicated that OIRA had completed an
initial review of the suggestions and placed them into one of three
categories: (1) "high priority," meaning that OIRA was inclined to
agree with and look into the suggestion, (2) "medium priority," meaning
that OIRA needed more information about the suggestion, or (3) "low
priority," meaning that OIRA was not convinced that the suggestion had
merit. OIRA listed 23 of the suggestions in the first category, and
said a "prompt letter" might be sent to the responsible agency for its
"deliberation and response." Eight of the 23 high priority suggestions
involved regulations from EPA, 5 suggestions involved regulations from
the Department of Labor (DOL), and 2 each from the Departments of
Health and Human Services (HHS), Agriculture (USDA), and the Interior
(DOI). Five of the 23 suggestions involved rules that had been issued
at the end of the Clinton administration and delayed by a January 20,
2001, memorandum from Assistant to the President and Chief of Staff
Andrew H. Card, Jr. (Card memorandum) directing federal agencies to,
among other things, postpone the effective dates of certain regulations
for 60 days.[Footnote 70] As table 6 shows, 13 of the 23
recommendations came from the Mercatus Center, and one was a joint
recommendation from Mercatus and the Association of Metropolitan Water
Agencies.
Table 6: The Mercatus Center Suggested Most of the 23 "High-Priority
Review" Rules:
Commenter: Mercatus Center; Regulation at issue: Central air
conditioner and heat pump energy conservation standards; Agency issuing
regulation: Department of Energy.
Commenter: Mercatus Center; Regulation at issue: Standards for privacy
of individually identifiable health information; Agency issuing
regulation: HHS.
Commenter: Mercatus Center; Regulation at issue: Food labeling: trans
fatty acids in nutrition labeling; Agency issuing regulation: HHS/Food
and Drug Administration.
Commenter: Mercatus Center; Regulation at issue: Hardrock mining;
Agency issuing regulation: DOI/Bureau of Land Management.
Commenter: Mercatus Center; Regulation at issue: Snowmobile use in
Rocky Mountain National Park; Agency issuing regulation: DOI/National
Park Service.
Commenter: Mercatus Center; Regulation at issue: Davis-Bacon Act
"helpers" regulation; Agency issuing regulation: DOL/ Employment
Standards Administration.
Commenter: Mercatus Center; Regulation at issue: Hours of service of
drivers; Agency issuing regulation: DOT/Federal Motor Carrier Safety
Administration.
Commenter: Mercatus Center; Regulation at issue: Total maximum daily
loads; Agency issuing regulation: EPA.
Commenter: Mercatus Center; Regulation at issue: Economic incentive
program guidance; Agency issuing regulation: EPA.
Commenter: Mercatus Center; Regulation at issue: New source review 90-
day review background paper; Agency issuing regulation: EPA.
Commenter: Mercatus Center; Regulation at issue: Concentrated animal
feeding operations effluent guidelines; Agency issuing regulation: EPA.
Commenter: Mercatus Center/ Association of Metropolitan Water Agencies;
Regulation at issue: Arsenic in drinking water; Agency issuing
regulation: EPA.
Commenter: Mercatus Center; Regulation at issue: Roadless area
conservation (draft environmental impact statement); Agency issuing
regulation: USDA/ Forest Service.
Commenter: Mercatus Center; Regulation at issue: Forest Service
planning rules; Agency issuing regulation: USDA/Forest Service.
Commenter: Notre Dame University; Regulation at issue: Title IV
regulations under the Higher Education Act; Agency issuing regulation:
Department of Education.
Commenter: Equal Employment Advisory Council; Regulation at issue:
Office of Federal Contract Compliance Programs' (OFCCP) equal
opportunity survey; Agency issuing regulation: DOL/OFCCP.
Commenter: Equal Employment Advisory Council; Regulation at issue:
Uniform Guidelines on Employee Selection Procedures; Agency issuing
regulation: Equal Employment Opportunity Commission.
Commenter: Employment Policy Foundation (EPF); Regulation at issue:
Procedures for certification of employment based immigration and guest
worker applications; Agency issuing regulation: DOL/Employment and
Training Administration.
Commenter: LPA, Inc; Regulation at issue: Overtime compensation under
the Fair Labor Standards Act; Agency issuing regulation: DOL/Wage and
Hour Division.
Commenter: EPF/National Partnership for Women and Families; Regulation
at issue: Record keeping and notification regulations under the Family
and Medical Leave Act; Agency issuing regulation: DOL/Wage and Hour
Division.
Commenter: American Chemistry Council; Regulation at issue: Mixture and
derived from rule under the Resource Conservation and Recovery Act;
Agency issuing regulation: EPA.
Commenter: City of Austin; Regulation at issue: Drinking water
regulations under the Safe Drinking Water Act; Agency issuing
regulation: EPA.
Commenter: American Petroleum Institute; Regulation at issue:
Notification of substantial risk under the Toxic Substances Control
Act; Agency issuing regulation: EPA.
Source: OMB.
[End of table]
In its December 2002 report, OIRA noted that several commenters
questioned the 2001 comment process because the Mercatus Center
provided a majority of the recommendations for reform. OIRA said it
believed that, if there was a problem with that process, "it was not
that the Mercatus Center was too active but that other potential
commenters were silent." An OIRA representative told us during this
review that the Mercatus Center had systematically tried to analyze and
comment on a wide range of rules, and it simply submitted the analyses
that it had done. A Mercatus Center official told us that the center
had submitted nominations regarding all of the rules on which it had
commented since 1997.[Footnote 71]
How High Priority Review Selections Were Made:
Although OIRA identified the source and ranking of each of the
suggestions that it received, the office did not fully explain in its
report to Congress how it decided that 23 of the suggestions merited
high priority review. During our review, OIRA representatives told us
that those determinations were made through a very informal, "bottom-
up" process, with OIRA staff initially looking at the nominations with
which they were most familiar and making some preliminary decisions
that were then reviewed by the branch chiefs and others. They said the
OIRA Administrator made the final decision regarding which rules should
be in the high priority category.
In its December 2002 final report, OIRA noted that 8 of the 23 high-
priority nominations listed in the December 2001 report addressed EPA
rules, and another 5 addressed rules that could be considered
environmental in nature. However, OIRA said "an examination of OIRA's
decision-making process reveals no implicit or explicit intent to
target environmental rules for scrutiny. In fact, the distribution of
nominated rules by agency reflects the concerns raised by public
comments, not the interests of OIRA." OIRA noted that only 13 of 33
environmental rules that were nominated were rated as a high priority
for review and said some of these 13 rules had already been established
as an administration priority for review.
Status of Rules Selected for High Priority Review:
As of May 2003, the status of the rules that were the subject of the 23
high-priority suggestions varied. OIRA said in its December 2002 final
report that, in some cases, the agencies had "convinced us that reform
is unnecessary or not appropriate at this time." For example, OIRA
noted that EPA had decided not to modify its rule on arsenic in
drinking water, and DOL had decided that changes in the Davis-Bacon
regulations were not appropriate at that time. However, as the
following examples illustrate, in many cases the responsible agencies
took action on the suggestions or were in the process of taking action:
* One of the nominations focused on a Department of Energy rule issued
in January 2001 that would have required that the energy efficiency of
new central air conditioners be increased by 30 percent. The commenter
said that the department did not adequately consider differences among
consumers and may have overstated projected energy savings. In May
2002, DOE withdrew the rule and issued a new rule requiring a 20
percent increase in energy efficiency. The new rule's effective date
was August 2002.
* EPA's July 2000 final rule regarding allowable amounts of pollution
in water ("total maximum daily load") was also the subject of a
suggested change. Specifically, the commenter said the revisions to the
program in that rule were overly prescriptive and could prove costly to
the states. In October 2001, EPA published a notice delaying the
effective date of the rule until April 2003. In March 2003, EPA
published a final rule withdrawing the July 2000 rule. By May 2003, a
draft of a new proposed rule was undergoing informal interagency
review.
* Another commenter questioned the assumptions underlying a May 2000
proposed rule that would alter the hours of service for motor carrier
drivers (e.g., trucks and buses). In April 2003, FMCSA published the
final rule that changed the scope and the requirements from the
proposal. For example, the final rule exempts buses from its coverage.
Most of the final rule's provisions were scheduled to take effect in
June 2003.
* One commenter expressed concerns about Department of Education
regulations under Title IV of the Higher Education Act, indicating that
the rules were redundant and placed "inappropriate administrative
burdens on institutions of higher learning." In November 2002, the
department published a final rule amending regulations under the Higher
Education Act, and said the amendments were designed to "reduce
administrative burden for program participants, and to provide them
with greater flexibility to serve students and borrowers." The rules
were generally scheduled to take effect in July 2003.
In these and many other cases, it is impossible to know whether the
changes that the agencies made and were making to rules were initiated
or affected by their designation as an item for high priority review.
However, OIRA representatives noted that some of the changes that
agencies were making to their rules began as a consequence of the
administration's Card memorandum review in January 2001--not their
later designation as an item for high priority review. Appendix IV
provides information on the status of each of the 23 high priority
rules as of May 2003.
Second Round of Nominations Was Different:
Section 624 of the Treasury and General Government Appropriations Act
of 2001, also known as the "Regulatory Right-to-Know Act," required
OIRA to include "recommendations for reform" in its cost-benefit report
each year. Therefore, in its March 2002 draft report, OIRA repeated its
solicitation of public comments on regulations or regulatory programs
in need of reform. However, OIRA's second effort to identify rules for
further review differed from its 2001 effort in the following respects.
* In the 2001 effort, OIRA asked the public to identify "regulations
that could be rescinded or changed that would increase net benefits to
the public by either reducing costs and/or increasing benefits."
However, in the 2002 effort OIRA asked the public to nominate reforms
to specific rules that would increase net benefits to the public,
including not just the elimination or modification of existing rules
but also "extending or expanding existing regulatory programs." OIRA
also specifically requested comments on regulations affecting small
businesses, and invited comments on agencies' practices regarding
guidance documents.
* Whereas OIRA received only 71 nominations in 2001, primarily from one
commentor, in the December 2002 report OIRA said it received comments
on 267 regulations and 49 guidance documents from approximately 1,700
individuals, firms, trade organizations, and others. Many of the 23
items that OIRA designated for high priority review during the 2001
process were again nominated. Although most of the nominations sought
modifications that would increase regulatory flexibility or rescind
rules, more than a quarter of them suggested making rules more
stringent or developing new rules.
* In the first effort, OIRA reviewed the nominations and decided which
ones merited high priority review. In the second effort, OIRA indicated
that the agencies would be responsible for initially reviewing and
prioritizing the suggested items. OIRA said it did so because of the
large volume of nominations, and because the agencies could bring to
bear "their extensive knowledge and resources, which will provide a
basis for selecting reform priorities in consultation with OIRA.":
* As noted previously, OIRA did not fully explain in its report to
Congress regarding the 2001 review how it decided which rules merited
high priority review. However, in the December 2002 report OIRA
discussed in some detail how it processed the nominations and suggested
three criteria that the agencies should use to conduct their
evaluations: (1) efficiency (reforms that can maximize net benefits,
including improvements to the economy, environment, and public health
and safety), (2) fairness (nominations with the potential for desirable
distributive impacts and process considerations), and (3) practicality
(nominations that are more important than others and that can be
implemented under existing statutory authority).
OIRA asked the Small Business Administration's Office of Advocacy to
review all of the nominations and identify those that it believes could
reduce unjustified regulatory burdens on small businesses. OIRA asked
that agencies complete their initial review of the nominations and
discuss them with OIRA by the end of February 2003. An OIRA
representative told us that the office met with the agencies that had
the most nominated rules (i.e, EPA, HHS, DOT, and DOL) in January and
February 2003 and emphasized that the final decisions on which
suggestions to pursue would be up to the agencies.
[End of section]
Chapter 5: Conclusions and Recommendations:
Conclusions:
OIRA has been reviewing agencies' draft rules for more than 20 years,
and those reviews have become an established and important part of the
federal rulemaking process. While OIRA reviews clearly have an
analytical component (e.g., ensuring compliance with legal and
procedural requirements and conformance with principles of economic
analysis), they are also a way to ensure that the agencies' regulatory
programs are consistent with administration priorities (within
applicable legislative constraints). OIRA is part of the Executive
Office of the President, and the President is OIRA's chief client.
Because it represents the President and because it reviews hundreds of
significant rules each year from dozens of federal agencies, OIRA can
have a major influence on the direction of a wide range of public
policies.
Our review documented OIRA's direct influence with regard to more than
two dozen rules in which it suggested significant changes that were
ultimately adopted by the rulemaking agencies. OIRA's presence in the
rulemaking process may also have a subtler, more indirect effect on
agencies' decision making--discouraging them from submitting rules that
OIRA is unlikely to find acceptable and encouraging them to make the
case for the regulations that they do submit more carefully. However,
the OIRA regulatory review process is not well understood or
documented, and the effect that OIRA's reviews have on individual rules
is not always easy to determine.
Agency and OIRA Documentation Not Always Clear:
Concerns about the effect that OIRA was having on agencies' rules led
to the adoption of transparency requirements in section 6 of Executive
Order 12866. For nearly 10 years the executive order has required
agencies to identify for the public the substantive changes in
regulatory actions that were made between the drafts submitted to OIRA
and the actions subsequently announced, and to identify the changes
made to the drafts at the suggestion or recommendation of OIRA. Some of
the agencies that we focused on in our review (EPA's Office of Water,
FDA, and FMCSA) had what we considered to be "best practices" of
documenting these changes, although their methods of documentation
varied considerably. However, in other agencies the documentation of
the changes made to their rules was either unavailable or unclear,
making it difficult for us to determine what effect OIRA's review had
on their rules. For example:
* Some agencies did not comply with the executive order's transparency
requirements at all (FAA) or did not put the required information in
the agencies' public dockets (OSHA). In a few cases, the agencies did
not put the information in the dockets until months after the rules had
been published (i.e., not until we asked for the files as part of this
review). The agencies correctly noted that neither the executive order
nor OIRA guidance establishes a time limit by which the documentation
had to be provided.
* In many cases, it was unclear whether the documentation that the
agencies provided was complete (e.g., the agencies provided multiple
drafts, "change pages," and/or memoranda identifying alterations that
had been made to their rules, but there was no indication that the
changes identified represented all of the substantive changes made to
the rules).
* In some cases, it was unclear which changes that the agencies
identified were suggested by OIRA and which were suggested by others
(e.g., the rulemaking agencies themselves).
* In other cases, it appeared that the agencies focused their efforts
on documenting changes that had been suggested by OIRA but did not
clearly document whether others had initiated substantive changes in
the rules during the OIRA review period.
* The agencies also differed in what they considered a "substantive"
change that required documentation. Some of the agencies identified all
changes made to their rules during OIRA's review, regardless how small.
However, other agencies said they only considered changes to the text
of the rule as it appears in the Code of Federal Regulations to be
"substantive." Our review indicated that some changes made to the
preambles of the agencies' rules (e.g., suggestions that agencies
solicit comments on particular issues) could affect their application,
and therefore appeared to us to be "substantive.":
The executive order also places certain transparency requirements on
OIRA. For example, the order requires OIRA to disclose any substantive
communications it has with outside parties regarding rules under
review, and the status of all regulatory actions under review. After a
regulatory action that it reviewed has been issued, OIRA is required to
disclose all documents exchanged between OIRA and the agency during the
review. However, in some cases the documentation that OIRA provided
regarding the rules it reviewed did not clearly illustrate what
occurred. For example,
* OIRA's descriptions of its contacts with outside parties sometimes
did not clearly indicate what rule was being discussed or what
organizations those parties represented.
* OIRA's coding of some of the outcomes of its reviews made our review
more difficult. In particular, the "consistent with change" code
included any type of change made to a rule, regardless of its
significance or source. As a result, an agency's action to correct a
legal citation or a misspelling is coded the same as a significant
change to the text of a rule that was suggested by OIRA. Also, OIRA's
use of an outcome code of "deadline case" for some rules provided no
information on whether the reviews of such rules were completed with or
without changes. The usefulness of that outcome code is also
questionable, given that OIRA's database already has a separate field
to identify rules with legal deadlines.
* As interpreted by OIRA, the requirement that OIRA disclose documents
exchanged with the agencies only applies to documents exchanged by
staff at the branch chief level and above. Therefore, under this
interpretation, OIRA is not required to disclose any documents that are
e-mailed or faxed between OIRA desk officers and regulatory agency
personnel--the level at which such exchanges are most likely to occur.
Nevertheless, during our review we sometimes discovered staff-level e-
mails and other documentation in the agencies' or OIRA's dockets, and
that information was very useful in explaining what had happened to
rules undergoing OIRA review. We have no way of knowing how often other
documents were exchanged at the staff level and not disclosed.
There also appears to be a gap in the transparency requirements
applicable to OIRA regulatory reviews. If OIRA returns a rule to the
rulemaking agency for reconsideration, the executive order requires
OIRA to explain in writing why the rule was returned. If a rule is
substantively changed while under review at OIRA, the executive order
requires the agency to identify those changes for the public. However,
neither the rulemaking agencies nor OIRA are required to disclose why
rules are withdrawn from review. Our review indicated that withdrawals
can be initiated by the agencies, can be requested by OIRA, or can be a
joint decision. If a rule is withdrawn and not subsequently published,
the agencies may not create a docket into which any explanation for the
withdrawal could be disclosed. Therefore, in those instances, OIRA may
be the most logical site for any withdrawal disclosure--just as it is
for returns. If the withdrawn rule is subsequently published, the
agencies could document the reasons for the withdrawals in the
rulemaking docket.
Opportunity to Build on Improvements in Transparency:
The current OIRA Administrator has made several notable improvements in
the transparency of the office's regulatory reviews. For example, by
placing information about the rules under review and OIRA's contacts
with outside parties on the office's Web site, the Administrator has
made that information much more accessible to the public than it had
been previously. Also, recognizing that outside parties were
increasingly contacting OIRA during the informal review periods that
sometimes precede formal submission, the Administrator changed the
trigger for the disclosure requirements applicable to OIRA's
interactions with outside parties from the start of the formal review
period to the start of any informal review period. As a result, OIRA
now discloses substantive communications (e.g., phone calls, meetings,
and correspondence) with outside parties involving specific rules that
occur any time after OIRA receives a draft rule from the agency or
begins substantive discussions with an agency about the provisions of a
draft rule. Disclosing the office's interactions with outside parties
at this stage of the rulemaking process can go a long way toward
eliminating what the Administrator referred to as "the culture of
secrecy and mystery" that has surrounded OIRA for more than 20 years.
However, another result of this change in policy is that the trigger
for the transparency requirements applicable to OIRA regarding its
interaction with outside parties (the start of informal review) is now
inconsistent with the trigger for the transparency requirements
applicable to OIRA and the agencies regarding their interactions with
each other (the start of formal review). We agree with the
Administrator that it is useful and important that the public know
about OIRA contacts with outside parties while rules are undergoing
informal review. However, we also believe that it is at least as
important for the public to know whether substantive changes were made
to agencies' draft rules during this period, and in particular, whether
those changes were suggested by OIRA.
The transparency requirements in Executive Order 12866 were intended to
allow the public to understand what changes had been made to agencies'
rules during OIRA's review and at OIRA's suggestion. During our review
we discovered that formal OIRA review periods can be as short as 1 day,
but informal review periods can go on for weeks or even months in
advance of formal reviews. Therefore, restricting the transparency
requirements in Executive Order 12866 only to a brief period of formal
review seems antithetical to the intent of those requirements. We also
discovered that agencies sometimes provided the public with
documentation of changes occurring during informal OIRA reviews--even
though they were not required to do so. In several cases that
documentation helped us to identify significant changes that had been
suggested by OIRA and to better understand how the published rule was
developed. Based on that documentation and other evidence that was
available, we concluded that OIRA's reviews appeared to have had a
significant effect on 25 of the 85 rules that we examined. However,
because neither OIRA nor the rulemaking agencies are required to
document the changes during informal review, we do not know whether
there were other "consistent with change" rules (or even rules coded as
"consistent with no change") that were significantly altered at the
suggestion of OIRA.
In several speeches during the past 2 years the OIRA Administrator has
emphasized the importance of transparency, describing the establishment
of a climate of openness at OIRA as his "first priority" and stating
that "more openness at OMB about regulatory review will enhance public
appreciation of the value and legitimacy of a centralized analytical
approach to regulatory policy." Also, on more than one occasion, OIRA
has said that it can have its most significant effect on agencies'
draft rules before they are formally submitted to OIRA for review.
Therefore, it is not clear why OIRA believes that the executive order's
transparency requirements should not cover the part of the review
period when the most important changes can occur. Real transparency
about the effects of OIRA's reviews would require either OIRA or the
rulemaking agencies to disclose the changes made to agencies' draft
rules during informal review. Under OIRA's current interpretation of
the executive order's requirements, the public might never know about
some of the most significant changes that are made to agencies' rules.
We recognize that there are limits to what should be disclosed
regarding OIRA's interactions with the rulemaking agencies. OIRA and
the agencies should be able to discuss regulatory matters in general
without having to document and disclose those communications. However,
if the published version of a rule reflects substantive changes that
OIRA recommended to the draft rule, even if those changes were
recommended during informal review, we believe that the agencies should
document the changes so that the public can understand how the rule was
developed. We also recognize that it may not always be clear when
informal reviews begin (e.g., when "substantive" discussions with
agencies have begun regarding draft rules). However, OIRA must make
that determination now regarding the disclosure of its contacts with
outside parties. Also, although OIRA representatives indicated that
postpublication disclosure of communications between OIRA and the
agency that occur prior to formal rule submission could have a
"chilling effect" on those communications in the future, that effect
does not appear to have taken place in those agencies that already
disclose those communications. Further, our interactions with the
agencies and OIRA during this review indicated that a requirement that
substantive changes be disclosed during any part of OIRA's review would
not pose practical difficulties for either party. Both OIRA and the
agencies know what substantive changes are made to agencies' rules
during the review period (whether formal or informal) and the source of
those changes.
Although the current Administrator has substantively improved the
ability of the public to understand the OIRA regulatory review process,
we believe that there are several additional initiatives that OIRA can
undertake to further improve the transparency of the review process
without sacrificing the confidentiality of OIRA-agency consultations.
Recommendations:
We recommend that the Director of the Office of Management and Budget:
* Define the transparency requirements applicable to the agencies and
OIRA in section 6 of Executive Order 12866 in such a way that they
include not only the formal review period but also the informal review
period when OIRA says it can have its most important impact on
agencies' rules. Doing so would make the trigger for the transparency
requirements applicable to OIRA's and the agencies' interaction
consistent with the trigger for the transparency requirements
applicable to OIRA regarding its communications with outside parties.
* Change OIRA's database to clearly differentiate within the
"consistent with change" outcome category which rules were
substantively changed at OIRA's suggestion or recommendation and which
rules were changed in other ways and for other reasons.
* Improve the implementation of the transparency requirements in the
executive order that are applicable to OIRA. Specifically, the
Administrator should take the following actions:
* More clearly indicate in the OIRA meeting log which regulatory action
was discussed and the affiliations of the participants in those
meetings.
* Because most of the documents that are exchanged while rules are
under review at OIRA are exchanged between agency staff and OIRA desk
officers, OIRA should reexamine its current policy that only documents
exchanged by OIRA branch chiefs and above need to be disclosed.
* Establish procedures whereby either OIRA or the agencies disclose the
reasons why rules are withdrawn from review.
* Improve the implementation of the transparency requirements in the
executive order that are applicable to agencies. Specifically, the
Administrator should:
* Define the types of "substantive" changes during the OIRA review
process that agencies should disclose as including not only changes
made to the regulatory text but also other, noneditorial changes that
could ultimately affect the rules' application (e.g., explanations
supporting the choice of one alternative over another and suggestions
that agencies solicit comments on the estimated benefits and costs of
regulatory options).
* Instruct agencies to put information about changes made to rules
after submission for OIRA's review and at OIRA's suggestion or
recommendation in the agencies' public rulemaking dockets, and to do so
within a reasonable period after the rules have been published.
* Encourage all agencies to use "best practice" methods of
documentation that clearly describe the changes made to agencies' rules
(e.g., like those practices used by FDA, EPA's Office of Water, or
FMCSA).
Agency Comments and Our Evaluation:
On August 8, 2003, we provided a draft of this report to the Director
of OMB for his review and comment. We also provided a draft to APHIS,
FDA, DOL, DOT, and EPA for technical review. We received several
technical suggestions from these agencies, which we incorporated as
appropriate. For example, at the request of certain agencies, some of
the entries in appendix II now provide both the title of the rule as
submitted to OIRA and the title as published in the Federal Register.
We also made minor changes to the body of the report clarifying why
certain rules were changed or withdrawn.
On September 2, 2003, the Administrator of OIRA provided written
comments on the draft report. (See app. V for a copy of these
comments.) The Administrator said OIRA believed the "factual
foundations of the report are well grounded," and was particularly
pleased that the report noted improvements in the timeliness of OIRA's
reviews and the transparency of the review process. He also said that
OIRA plans to review its implementation of the transparency
requirements and, in particular, would work to improve the clarity of
its meeting log. However, the Administrator said OIRA did not agree
with all of the recommendations in the draft report, and did not
believe that the report had demonstrated the need or desirability of
changing the agency's existing "unprecedented" level of transparency.
He then discussed several specific issues, describing why he disagreed
with the recommendations. The bullets below summarize his concerns and
present our response.
* The Administrator said that OIRA did not believe that disclosure of
"deliberations" that occur during informal review of rules would
improve the rulemaking process. He also said that Congress and the
courts have recognized the importance of confidentiality during the
deliberative process and said it would not be appropriate for OIRA to
waive the "deliberative privilege" for rulemaking agencies. However, we
did not recommend that OIRA's deliberations with the agencies be
disclosed. Our recommendation was that, after a rule has been published
in the Federal Register, agencies disclose any substantive changes made
to draft rules--whether those changes were made during the formal
review process or an informal review. As we said in the draft report,
real transparency regarding the substantive changes made to agencies'
draft rules during OIRA's review requires disclosure of those changes
whenever they occurred. Excluding the portion of the review process
when OIRA has said it can have its most significant effect seems to
seriously call into question the transparency of that process. The
desirability of such disclosure was clearly demonstrated during our
review when agencies disclosed substantive changes made to their rules
during informal review at the suggestion or recommendation of OIRA.
Those disclosures greatly facilitated our understanding of the extent
to which OIRA affected the rules at issue.
* The Administrator said that the draft report does not explain why
changes are needed to the "longstanding practice" of limiting the
disclosure of documents exchanged during the review process to only
documents that were exchanged at the OIRA branch chief level and above.
In our draft report, we recommended that OIRA reexamine that policy
because our review of OIRA's and the rulemaking agencies' files
indicated that most of the documents exchanged occurred below the
branch chief level. Therefore, only requiring disclosure of documents
exchanged at a level at which they rarely are exchanged seems
inconsistent with the spirit of transparency.
* The Administrator indicated that the draft report does not explain
why agencies or OIRA should disclose why rules are withdrawn from
review, again noting that nondisclosure has been a "longstanding
practice." He also indicated that rules are withdrawn at the request of
the rulemaking agency and that OIRA does not believe it is appropriate
for it to "waive the deliberative privilege" by disclosing why rules
are withdrawn. However, as we noted in our report, the executive order
already requires disclosure regarding rules that are changed or
returned to the agencies. Withdrawals are the only substantive action
that can be taken without explanation or documentation. Further, our
review indicated that OIRA sometimes initiates these withdrawals (even
though they were technically "requested" by the agencies).
* The Administrator noted that the draft report recommended that OIRA
differentiate within the "consistent with change" category in its
database those rules that were substantively changed at OIRA's
suggestion or recommendation and those rules that were changed in other
ways and for other reasons. He then referred to the former
Administrator's response to our 1998 report, indicating that OIRA
continues to believe that it is better to provide the public with
copies of the draft regulations reviewed by OIRA than to clearly
delineate which changes were substantive. First of all, we did not
address the issue of the "consistent with change" category in our 1998
report. Further, we concluded during this review that it is extremely
difficult to determine what changes had been made in different versions
of draft rules that sometimes were hundreds of pages in length--much
less to determine which of those changes were substantive. The
executive order requires rulemaking agencies to identify for the public
the substantive changes made to draft rules "in a complete, clear, and
simple manner." It does not place the responsibility on the public to
identify changes made to agency rules. Also, simply providing copies of
the rules as they entered and exited OIRA does not necessarily identify
changes made at OIRA's suggestion or recommendation.
* Finally, the Administrator indicated that he disagreed with our
recommendation that OIRA encourage agencies to use "best practices" in
disclosing changes made to their rules and said that OIRA would defer
to the agencies on this issue (as it did during the previous
administration). He also said OIRA expected that many of the
differences in agencies' documentation practices that we identified
should be eliminated by the administration's e-rulemaking initiative
(which would consolidate each agency's public docket into a single
governmentwide docket).[Footnote 72] Our examination of agencies'
rulemaking dockets during this review indicated that the documentation
of changes made during OIRA's review was often confusing and, at times,
totally absent. Also, section 2(b) of the executive order states "to
the extent permitted by law, OMB shall provide guidance to agencies"
and that OIRA "is the repository of expertise concerning regulatory
issues, including methodologies and procedures that affect more than
one agency." Therefore, we believe that OIRA has a responsibility under
the executive order to instruct agencies regarding the order's
transparency requirements (just as it has done with regard to other
issues). Further, the consolidation of the agencies' dockets in the
administration's e-rulemaking initiative will not address the
deficiencies that we observed regarding the contents of some of those
dockets. The confusing documentation (or the absence of documentation)
will just be more accessible to the public.
Overall, we continue to believe that improvements can and should be
made to improve the transparency of the OIRA review process. We
recognize and applaud the improvements that the current Administrator
has made in this area. However, the difficulties that we experienced
during this review clearly demonstrated that OIRA's reviews are not
always transparent to the public. Weaknesses were apparent regarding
both the coverage and the implementation of the requirements placed on
both OIRA and the rulemaking agencies. Our review also indicated that,
when OIRA and the rulemaking agencies disclosed changes and
communications beyond what is currently required, those practices
greatly enhanced our (and the public's) ability to understand how rules
are made.
[End of section]
Appendixes:
Appendix I: Objectives, Scope, and Methodology:
This appendix presents more detailed information about our reporting
objectives, the scope and methods used to address each of the
objectives and subobjectives, and the most significant limitations of
our findings and analyses.
Objectives:
The general purpose of this engagement was to examine and report on how
the Office of Management and Budget's Office of Information and
Regulatory Affairs (OIRA) conducts its regulatory review function and
the outcomes of those reviews. Specifically, we were asked to:
1. Describe OIRA's current regulatory review policies and processes and
determine whether, and if so how, those policies and processes have
changed in recent years.
2. Identify the rules issued by selected agencies that were reviewed by
OIRA between July 1, 2001, and June 30, 2002, and that were either
significantly changed at OIRA's direction, returned by OIRA for further
consideration by the agencies, or withdrawn by the agencies at OIRA's
suggestion. For each such rule, (a) describe the changes made by OIRA,
the reasons why the rule was returned or withdrawn, and any subsequent
activity regarding the rule, (b) describe, to the extent possible, the
effects of the changes, returns, and withdrawals on the rule's original
benefits and costs, and (c) determine whether there are any indications
that the actions OIRA took were traceable to suggestions offered by
regulated entities or outside parties and, if so, whether OIRA publicly
disclosed their involvement.[Footnote 73] We also examined OIRA's and
the agencies' application of the transparency requirements in Executive
Order 12866 and related guidance.
3. Describe how OIRA determined that certain existing rules listed in
its reports to Congress on the costs and benefits of federal
regulations merited high priority review. With regard to OIRA's 2001
report, our specific objectives were to determine (a) which
organizations or persons suggested that the rules be reviewed, (b) what
process OIRA used to select and prioritize the nominations, (c) the
extent to which OIRA publicly disclosed its selection and priority-
setting process, and (d) the current status of those rules. Another
specific objective was to compare that 2001 effort to the process OIRA
used regarding a second round of nominations for OIRA's 2002 report.
Scope and Methodology:
Objective 1:
Under the first objective, our primary focus was on describing OIRA's
regulatory review policies and processes in place as of June 2002 or
later. To determine whether and to what extent those policies and
processes have changed in recent years, we focused mainly on
identifying changes that may have occurred since the previous
administration. However, to provide additional context on the evolution
of the OIRA review processes, we also identified the major changes that
have occurred since OIRA began carrying out a regulatory review
function in 1981.
To describe the policies and processes used by OIRA to conduct
regulatory reviews, we reviewed relevant primary documents, such as
executive orders, legislation, OMB guidance, and memoranda, speeches,
and documents from the OIRA administrator describing aspects of the
review process. We also reviewed other historical and secondary
documents that provided background and context on the framework for
OIRA's regulatory reviews. We interviewed current and former OIRA
officials to provide additional information on the changes, if any, in
the agency's regulatory review policies and processes. We supplemented
the documentary and testimonial evidence obtained from OIRA with
interviews and document reviews at selected regulatory agencies that
are subject to OIRA's regulatory reviews.
For this objective, and the other two objectives, we also interviewed
officials and staff from outside (nonfederal) groups representing
public interest groups and regulated entities that are actively
involved in observing and commenting on the federal regulatory process.
Participants in these meetings included representatives of the American
Bakers Association, American Road and Transportation Builders
Association, Center for Regulatory Effectiveness, Exxon/Mobil,
Mercatus Center, National Association of Home Builders, National
Association of Manufacturers, National Federation of Independent
Business Research Foundation, Natural Resources Defense Council,
National Roofing Contractors Association, OMB Watch, Public Citizen,
and United States Chamber of Commerce.
Objective 2:
With regard to the second objective, we used OIRA's Executive Order
Review database to identify the draft regulatory actions that agencies
had submitted for OIRA's review during the 1-year time period (July 1,
2001, through June 30, 2002) specified in the congressional request.
Because a given draft regulatory action could have been submitted for
OIRA's review more than once before final publication or disposition,
our unit of analysis was each separate submission to OIRA, which is
what OIRA's database reflects, rather than each rule. However, to
simplify reporting, we refer to these submissions as rules in this
report.
Out of the total of 642 draft items submitted for OIRA's review during
the 1-year time period, we identified 393 draft rules from 81 agencies
and offices for which OIRA's database had coded the outcome of the
review as "returned," "withdrawn," or "consistent with change." Because
we could not devote the time and resources that would have been
necessary to search dockets for all of these rules at all of the
agencies, we limited our efforts to selected rules and agencies,
focusing on the agencies with the largest numbers of affected rules, as
discussed and agreed to in consultation with the requesters.
Specifically, we agreed to focus our efforts on the rules submitted for
OIRA regulatory reviews that met the following criteria:
* The submission to OIRA was a draft health, safety, or environmental
rule.
* The rule was submitted to OIRA as a proposed, interim final, or final
rule (i.e., we did not include other items, such as prerules and white
papers, that agencies also sometimes submitted for OIRA's review).
* OIRA completed its review of the rule between July 1, 2001, and June
30, 2002.
* The rule was returned to the rulemaking agency by OIRA, withdrawn
from OIRA's review by the agency, or changed after its submission to
OIRA.
* The rule was from an agency or subagency that OIRA's Executive Order
Review database indicated had five or more rules returned, withdrawn,
or changed during the time period in scope for this objective.
We identified 85 draft regulatory actions that met these criteria. The
85 rules were submitted for OIRA's review from nine agencies--the
Animal Plant and Health Inspection Service (APHIS), the Food and Drug
Administration (FDA), the Occupational Safety and Health Administration
(OSHA), the Department of Transportation's (DOT) Federal Aviation
Administration (FAA), Federal Motor Carrier Safety Administration
(FMCSA), and National Highway Traffic Safety Administration (NHTSA),
and the Environmental Protection Agency's (EPA) Office of Air and
Radiation, Office of Solid Waste and Emergency Response, and Office of
Water. We generally did not question the rule dispositions used in the
OIRA database. However, we included one rule from EPA's Office of Air
and Radiation in the "consistent with change" category that had been
coded as a "deadline case" in the database because publicly available
information indicated that the rule had been changed in response to
OIRA's review.[Footnote 74] It is unclear whether other rules with
"deadline case" outcome codes in the database were also changed by
OIRA, or why other rules that we reviewed with statutory or legal
deadlines were not coded as deadline cases.[Footnote 75] We also
dropped one rule from EPA's Office of Solid Waste and Emergency
Response that had a "consistent with change" outcome code in OIRA's
database because it had not been published in the Federal Register at
the time of our review. (See app. II for information on each of the
selected submissions.):
We were asked to address three specific topics regarding the selected
rules: (1) the nature of the changes attributed to OIRA or the reasons
that rules were withdrawn or returned at OIRA's initiation, (2) the
effect of OIRA's actions on the costs and/or benefits of the rules, and
(3) contact with OIRA by external parties regarding these rules.
Because Executive Order 12866 also imposes certain documentation
requirements on agencies and OIRA regarding OIRA's regulatory review
process, we also addressed compliance with those requirements as a
fourth part of our analysis of the 85 rules.
In general, to address these four areas we reviewed the available
documents in both agency and OIRA rule dockets. We also interviewed
officials at the agencies and OIRA to obtain information about the
regulatory review process for the individual rules included in our
scope. We then used an iterative process to develop summary findings
and determinations on each rule. Multiple reviewers from our team
independently examined and coded the information and materials that had
been collected. We then held a series of meetings to discuss and reach
consensus on the coding and description of results for each rule. We
vetted these preliminary results with OIRA and the agencies to address
outstanding questions and obtain their feedback on the accuracy of our
findings and determinations. We incorporated their comments as
appropriate before developing our official draft report for formal
agency comments. The analysis and coding process for each of the four
areas also had some unique aspects, as described below.
Nature and significance of OIRA's effects on rules:
The review outcome categories used in the OIRA database are broader
than the specific types of rules targeted by our second objective--
those that were significantly affected by OIRA. Therefore, we had to
gather additional information on each of the 71 changed, 9 returned,
and 5 withdrawn rules to determine which ones had been significantly
affected by OIRA and, therefore, met our more specific criteria.
First, we used a variety of information sources (e.g., agency and OIRA
docket materials and interviews with agency officials) to place each of
the 71 rules that had been changed after submission to OIRA into one of
three categories, based on the most significant changes attributed to
either OIRA or OMB.[Footnote 76] Our three coding categories were:
1. Significant changes--This category included rules in which the most
significant changes attributed to OIRA or OMB affected the scope,
impact, or estimated costs and benefits of the rules as originally
submitted to OIRA. Usually, these significant changes were made to the
regulatory language that would ultimately appear in the Code of Federal
Regulations.
2. Other material changes--This category covered rules in which the
most significant changes attributed to OIRA or OMB resulted in the
addition or deletion of material in the explanatory preamble section of
the rule. For example, OIRA may have recommended that agencies provide
better explanations for certain rulemaking actions and/or suggested
that agencies ask the public to comment on particular aspects of the
rules.
3. Minor or no OIRA/OMB changes--We used this category to identify
rules in which the most significant changes attributed to OIRA's or
OMB's suggestions resulted in editorial or other minor revisions, or
rules in which changes occurred prior to publication but not at the
suggestion of OIRA or OMB. Where no OIRA/OMB changes were made, the
changes that caused the rule to be coded "consistent with change" in
OIRA's database could have been initiated by the regulatory agency
itself or by another federal agency (e.g., the Office of the Federal
Register). Because the executive order does not require agencies to
document nonsubstantive changes, three of the rules we included in this
category were ones in which it was clear that all the changes were
minor, but the source of the changes (i.e., whether they were made at
the suggestion of OIRA/OMB) could not be identified.
Identifying returned rules significantly affected by OIRA and OIRA's
rationale for the returns was more straightforward. When OIRA returns a
rule to an agency for reconsideration, section 6(b)(3) of Executive
Order 12866 requires the OIRA Administrator to provide the issuing
agency with a written explanation delineating the pertinent section of
the order on which OIRA is relying. OIRA has posted copies of its
return letters, including those relevant to rules within the scope of
our engagement, on the OMB Web site. OIRA identified other rules that
were returned for nonsubstantive reasons as "improper submissions" in
its database.
There are no documentation requirements on agencies or OIRA covering
withdrawn rules, so we relied primarily on testimonial evidence from
agency officials to determine whether OIRA, rather than the submitting
agency, had initiated the withdrawal. In one case, however, a withdrawn
rule from FAA that was subsequently resubmitted to OIRA and published,
the agency docket included a written chronology for the rulemaking
process that attributed the withdrawal to OIRA's action.
Effect of OIRA's reviews on costs and benefits:
We considered two types of actions attributed to OIRA or OMB as
potential evidence that OIRA directly affected the costs and/or
benefits of the rule compared to those expected under the draft version
of the rule submitted for OIRA's review. These were when (1) OIRA or
OMB suggested changes to a draft rule's regulatory text that could
reasonably be expected to affect the potential costs and/or benefits of
the regulations (e.g., changing the proposed federal share of an
indemnity payment) and (2) OIRA specifically commented on and requested
changes in the agencies' analyses of the economic impacts of the draft
regulations. With regard to the first type of action, we believed that
it was reasonable to assume that OIRA-suggested elimination or delay of
certain regulatory provisions in the text of draft rules as submitted
to OIRA would also eliminate or delay the expected costs and/or
benefits associated with those provisions. We also identified and
reported on other changes suggested by OIRA that, while not directly
affecting regulatory provisions or cost-benefit estimates, otherwise
revised, clarified, or requested comments on issues relevant to the
agencies' discussion of potential costs and/or benefits of a rule. We
consulted with our Chief Economist in making our determinations and
describing the potential effects of OIRA's actions.
Evidence of outside contacts regarding rules under OIRA review:
Another part of this objective was to determine whether there was any
evidence that the actions that OIRA took (e.g., to suggest significant
changes to rules or to return them to the agencies for reconsideration)
were traceable to suggestions offered by regulated entities or other
parties outside of the federal government. It is not possible to
independently determine what motivated OIRA's actions with regard to
any of the rules that it reviewed. However, as part of our review, we
checked whether OIRA had direct contact with such outside parties
regarding rules that OIRA significantly affected. We defined "direct
contact" as taking the form of either oral communications with OIRA
(meetings or phone calls) or written communications (correspondence)
sent directly to OIRA officials before or during the period of OIRA's
review. In some OIRA files, we found evidence that OIRA had reviewed
copies of substantive comments on previous versions of the draft rule
currently under review. Because these were public docket materials
previously submitted to the regulatory agencies, not OIRA, we did not
consider them as evidence of direct contact with OIRA by outside
parties. If there was evidence that outside parties had contacted OIRA,
we also examined whether there were similarities between the actions
that OIRA suggested or recommended to the agencies and those advocated
to OIRA by external parties through those direct contacts.
Transparency of agencies' and OIRA's documentation of reviews:
Our primary focus with regard to agencies' compliance with
documentation requirements of Executive Order 12866 was on determining
whether the agencies had publicly documented changes made in rules
between submission for OIRA's review and publication in the Federal
Register. Section 6(a)(3)(E)(ii) of the order states that agencies must
"identify for the public, in a complete, clear, and simple manner, the
substantive changes between the draft submitted to OIRA for review and
the action subsequently announced." However, neither the executive
order nor OIRA's October 1993 guidance on its implementation defines
what the term "substantive changes" means. Section 6(a)(3)(E)(iii) of
the order requires agencies to "identify for the public those changes
in the regulatory action that were made at the suggestion or
recommendation of OIRA." OIRA's October 1993 guidance on the
implementation of the order considers the second requirement to be a
subset of the first. Therefore, under this interpretation, the agencies
are only required to disclose the changes made at OIRA's suggestion or
recommendation after formal submission of the rule to OIRA--not during
any informal review period that precedes formal submission.
To determine agencies' compliance with these documentation
requirements, we considered the required information to have been
"identified for the public" if it was available in the agencies' public
docket for the relevant rule. We coded the level of documentation in
the agencies' dockets for each changed rule into one of four
categories, reflecting whether (1) all changes were clearly documented,
(2) changes were identified but it was not clear that all changes had
been documented or at whose initiative, (3) no changes were documented
in the public docket, or (4) the Executive Order 12866 documentation
requirements were not applicable.[Footnote 77] The first requirement is
not applicable when there were no changes made to the rule during
OIRA's review that the agencies considered "substantive." Even if there
were substantive changes made during OIRA's review, the second
requirement is not applicable if those changes were not made at the
suggestion or recommendation of OIRA. We made our determinations
regarding agencies' compliance with these requirements solely on the
basis of the information that would be available to a member of the
public if he/she had reviewed the docket for a given rule.[Footnote 78]
Further, because the executive order places responsibility to document
changes on the agencies rather than OIRA, our determinations only
reflect material available in the regulatory agencies' dockets, not
materials in OIRA's public files.[Footnote 79] However, we did use
information from the OIRA files to identify rule changes that agencies
should have documented.
Our primary focus with regard to OIRA's compliance with documentation
requirements was to see if (1) when returning rules to agencies for
reconsideration, the OIRA Administrator provided the issuing agency
with a written explanation delineating the pertinent section of the
order on which OIRA relied in returning the rule, as required by
section 6(b)(3) of the executive order, and (2) OIRA had documented
written and oral communications with outside parties regarding rules
under review by OIRA, as required by section 6(b)(4) of the order. To
address the first item, we confirmed that OIRA had prepared a return
letter for each of the rules it returned to agencies for
reconsideration of substantive issues. To address the second item, we
reviewed OIRA's docket files, meeting logs (both the paper-based and
on-line versions), and phone logs. We also checked other potential
sources of information on contacts with outside parties regarding the
85 rules, especially the agencies' regulatory docket files on these
rules.
Objective 3:
Our work to address the third objective focused on the particular
rules, and OIRA's processes for selecting and ranking those rules,
identified for high priority review in the 2001 and 2002 versions of
OMB's annual report to Congress on the costs and benefits of federal
regulations. In order to address the third objective, we reviewed any
available documentation describing the process that OIRA used to select
certain rules for high priority review. We also interviewed OIRA
officials and officials in other relevant agencies and organizations to
determine how the classifications were made, and reasons why the
particular selected rules were designated as high priority.
Limitations:
The most important limitations to our engagement were related to the
second objective. In particular:
* Our analysis of individual rules submitted for OIRA's review was
limited to the 85 rules and 9 agencies or offices that met specific
selection criteria. We did not review all 393 rules from all 81
agencies or offices that OIRA's database indicated had rules changed,
returned, or withdrawn during the 1-year period from July 1, 2001,
through June 30, 2002.
* Some types of OIRA's influence on rules may not be reflected in the
documentation we relied on in this review. For example, DOT officials
told us in 1996 that they will not even propose certain regulatory
provisions because they know that OIRA will not find them acceptable.
Also, the documentation that we reviewed generally did not reflect the
OIRA-suggested changes that were not adopted by the agencies.
* We cannot be sure that we have identified all changes to the selected
rules that were made at the suggestion or recommendation of OIRA (e.g.,
changes made as a result of informal OIRA reviews that were not
documented). Neither can we be sure to have identified all the effects
of such changes on the rules or all instances in which an external
party may have influenced OIRA's actions.
* Given the available documentation, we were not able to clearly
attribute all changes or actions taken regarding the selected rules to
OIRA or to the actions or influence of outside parties. We cannot
attribute any cause-effect relationships in those instances where both
OIRA's comments or changes regarding a particular rule and the
suggestions of an external party on that same rule were similar.
Likewise, any identified changes in the benefits and costs of selected
rules after OIRA's reviews may not be attributable in whole or in part
to changes made at OIRA's suggestion.
* Characterizing the nature of changes made to the rules, particularly
the extent to which they are "significant," is inherently subjective.
We attempted to mitigate this limitation by (1) establishing criteria
to generally categorize the nature of changes, (2) using multiple
reviewers for each rule, and (3) obtaining views of agency and OIRA
officials on whether we had accurately identified and characterized the
nature of OIRA's effect on each rule.
* Our knowledge of OIRA contacts by outside parties, such meetings or
correspondence, was generally limited to what OIRA or the agencies
disclosed in their files. Although in one case we found documented
evidence of such contact through materials posted by a trade group--
evidence that did not appear in either the OIRA or agency files--we do
not know whether there were other meetings with outside parties or
other letters from those parties about rules in our review that did not
come to our attention.
[End of section]
Appendix II: Summary Information on Selected Rules Submitted to OIRA
for Executive Order Review between July 2001 and June 2002:
This appendix contains three tables that summarize GAO's findings and
determinations regarding 85 health, safety, or environmental rules
submitted for OIRA's review by nine selected agencies (APHIS, FDA,
OSHA, DOT-FAA, DOT-FMCSA, DOT-NHTSA, EPA-Office of Air and Radiation,
EPA-Office of Solid Waste and Emergency Response, and EPA-Office of
Water) that we examined to address our second reporting objective. The
three tables present information on, respectively, rules that were
changed after being submitted for OIRA's review (table 7), rules that
OIRA returned to the agencies (table 8), and rules that were withdrawn
after having been submitted for OIRA's review (table 9).
Explanation of Table Contents:
The following paragraphs identify the analytical contents of each table
and provide definitions of the codes we used. In general, for each
analytical category, we used a process of separate coding by each GAO
team member, followed by a discussion to reconcile any differences and
reach consensus on the most appropriate code. We then shared our
preliminary findings and determinations with OIRA and the regulatory
agencies to obtain a "fact check" on the descriptive information and
also solicited their comments or clarifications regarding our coding
determinations.
Table 7: Summary of Findings and Determinations for Changed Rules:
* GAO ID - This column provides a unique GAO case identification number
for each executive order submission to OIRA that we reviewed to address
our second reporting objective. Note that our unit of analysis was the
submission of a draft regulation for OIRA's review, not the rule
itself. Therefore, a given draft regulation could have been submitted
to OIRA more than once with more than one outcome. In such cases, each
separate submission that fell within the scope of our review would
appear under a different GAO ID.
* Executive order review submission - This column provides general
information about the draft regulation submitted for OIRA's review. As
noted above, our unit of analysis was the submission to OIRA, so the
titles presented here are those that appear in OIRA's data base on the
submissions it has received, not the titles of the rules as published
in the Federal Register. We also identify the draft rule's Regulation
Identifier Number (RIN),[Footnote 80] its type (proposed, final, or
interim final rule), the time
period for OIRA's formal review of the rule, and when and where the
cleared version of the rule was published in the Federal
Register.[Footnote 81]
* Nature of OMB/OIRA changes - This column represents GAO's
interpretation of the nature of the changes suggested by OMB or OIRA,
in particular whether the changes made to the rule in response to OMB
or OIRA significantly affected the draft rule. We used any available
information to categorize and describe the changes attributed to OMB or
OIRA (e.g., agency docket materials, OIRA files, interviews with agency
officials, and any memos or e-mails on the changes that agency
officials specifically prepared to address this GAO engagement). We
characterized the nature of the changes for each of the changed rules
using three categories, with a code assigned to each rule for the most
significant level of change observed. The three categories were:
1. Significant changes - We used this category for rules in which
changes attributed to OMB or OIRA resulted in a revision to the scope,
impact, or estimated costs and benefits of the rule compared to the
draft version originally submitted to OIRA. Most often, these were
rules in which changes were made to the regulatory language of the
draft regulation (i.e., amendments to the Code of Federal Regulations).
2. Other material changes - We used this category for changes that did
not have as significant an effect as "significant changes," but did
result in adding or deleting material to the original text. Most often,
these changes were in the preambles of the rules, rather than the
regulatory text, and involved clarifying an agency's explanation of
certain provisions in the rule, clarifying the agency's basis for
decisions made about regulatory options or assumptions, better
explaining the potential impact of different options, and requesting
public comments and/or data on regulatory options or costs.
3. Minor editorial changes or no OMB or OIRA changes - This category
was used both for rules with changes that, at best, represented
editorial corrections and revisions (e.g., rearranging existing text,
correcting spelling, word choice changes, and adding or correcting
boilerplate language, such as where to submit comments) and rules in
which no changes were made at the suggestion or recommendation of OMB
or OIRA.
* Evidence that OMB/OIRA changes affected the potential costs or
benefits of the submitted rule - We usually only assigned a "yes" code
under this topic if documentation of OMB or OIRA changes to a rule
specifically showed that cost-benefit, cost-effectiveness, Paperwork
Reduction Act burden estimates, or similar information on regulatory
impacts had been edited or changed at the suggestion of OMB or OIRA.
However, in the case of rules with substantive changes (additions or
deletions) in the regulatory language, we assumed that adding or
deleting entire provisions would have at least some effect on the
potential costs or benefits of the rule, compared to the draft version
submitted to OIRA.
* Evidence that outside parties contacted or met with OMB/OIRA
regarding the submitted rule - A "yes" code under this topic indicates
that we found documentation that an outside (nonfederal government)
party or parties had directly contacted OMB or OIRA regarding a
particular rule before or during OIRA's formal review period for that
rule. Direct contacts were either through a meeting or
correspondence.[Footnote 82] Most often, this evidence came from OIRA's
files and logs, but sometimes the documentation came from a regulatory
agency's docket on that rule.
Table 8: Summary of Findings and Determinations for Returned Rules:
* GAO ID and Executive Order Review Submission - (Columns as described
under table 7, except that information about the publication of the
rule, if applicable, appears under a separate column on subsequent
activity.):
* Reason for OIRA's return of the rule - For each rule, we summarized
the information presented in OIRA's return letter or, for the
"improper" submissions with no return letters, cited the classification
from OIRA's regulatory review database. In some cases, we supplemented
these descriptions with additional information provided by regulatory
agency officials.
* Evidence that outside parties contacted or met with OIRA regarding
this submission - (As described under table 7.):
* Evidence of subsequent activity regarding this submission - Our focus
under this topic was identifying information regarding resubmission and
publication of the rule after OIRA had returned it. If an agency
provided information that the rule has not yet been resubmitted and/or
published, we also report that.
Table 9: Summary of Findings and Determinations for Withdrawn Rules:
* GAO ID and Executive Order Review Submission - (As described under
table 7, except that information about the publication of the rule, if
applicable, appears under a separate column on subsequent activity.):
* Reasons for withdrawal of the submitted rule - For each rule, we
report the explanation provided by the regulatory agency and/or OIRA
regarding the withdrawal of the rule. Our primary focus under this
item, per our congressional request, was on identifying whether the
rule had been withdrawn at the suggestion of OIRA.
* Evidence that outside parties contacted or met with OIRA regarding
this submission - (As described under table 7.):
* Evidence of subsequent activity regarding this submission - (As
described under table 8.):
Table 7: Findings and Determinations for Rules Changed after Submission
to OIRA:
GAO ID: APHIS.
GAO ID: 1; Executive order review submission: Mexican Hass
Avocado Import Program; Proposed rule; RIN 0579-AB27; OIRA review
period: 06/13/2001 to 07/05/2001; Published 07/13/2001 (66 FR
36892); Nature of most significant OMB/OIRA changes: Other
material changes; Information was added to the preamble regarding
several topics--e.g., a previous amendment to Hass avocado regulations,
an APHIS review of the Hass avocado import program, a study on fruit
flies, responses to commenter concerns, and a new section summarizing
the regulatory impact analysis. Also, there were minor rewording
changes throughout. An APHIS official characterized most OIRA changes
to the rule as minor editorial comments but said that other changes
strengthened the agency's explanation for the rule. There were no
substantive changes to the regulatory language; Evidence that OMB/OIRA
changes affected costs or benefits: No; Evidence that outside
parties contacted OMB/OIRA: No.
GAO ID: 2; Executive order review submission: Karnal Bunt;
Compensation for the 1999-2000 and Subsequent Crop Seasons; Final
rule; RIN 0579-AA83; OIRA review period: 07/26/2001 to 07/31/2001;
Published 08/06/2001 (66 FR 40839); Nature of most significant OMB/
OIRA changes: Minor editoral changes or no changes; Changes
were limited to minor clarifications and a sentence change in the
Paperwork Reduction Act section in the preamble. There were no changes
in the regulatory language; Evidence that OMB/OIRA changes affected
costs or benefits: No; Evidence that outside parties contacted
OMB/OIRA: No.
GAO ID: 3; Executive order review submission: Importation
Prohibitions Because of Bovine Spongiform Encephalopathy (BSE);
Interim final rule; RIN 0579-AB26; OIRA review period: 04/18/2001
to 07/27/2001; Published 08/14/2001 (66 FR 42595); Nature of most
significant OMB/OIRA changes: Other material changes; A
section was added to the preamble noting that APHIS would obtain BSE
risk factor data from trading partners and, if significant risk was
indicated, APHIS would take action to restrict animal product imports
from the risky areas; Evidence that OMB/OIRA changes affected costs or
benefits: No; Evidence that outside parties contacted OMB/OIRA:
No.
GAO ID: 4; Executive order review submission: Scrapie in Sheep
and Goats; Interstate Movement Restrictions and Indemnity Program;
(Listed in OIRA's database as: Interstate Movement of Sheep and Goats
From States That Do Not Quarantine Scrapie-Infected and Source Flocks);
Final rule; RIN 0579-AA90; OIRA review period: 04/18/2001 to 08/
07/2001; Published 08/21/2001 (66 FR 43964); Nature of most
significant OMB/OIRA changes: Other material changes; OMB
suggested several changes to the preamble that added or clarified
descriptions of issues such as (a) the increase in paperwork burden
caused by this rule, (b) how to calculate animal and human health risks
associated with scrapie, and (c) how to estimate the effectiveness of
indemnity as an incentive. OMB also suggested that APHIS clarify how
much of the rule's activities could be funded from currently projected
agency budgets and how much would require additional funds. According
to APHIS, these additional discussions caused no significant changes to
the scope of the rule or the benefits it provided. The regulatory
language was not changed; Evidence that OMB/OIRA changes affected
costs or benefits: No; Evidence that outside parties contacted
OMB/OIRA: No.
GAO ID: 5; Executive order review submission: Phytosanitary
Certificates for Imported Fruits and Vegetables; Proposed rule; RIN
0579-AB18; OIRA review period: 03/21/2001 to 08/15/2001; Published
08/29/2001 (66 FR 45637); Nature of most significant OMB/OIRA changes:
Other material changes; In a memo prepared for GAO, APHIS
identified eight specific changes that OMB requested, all in the
preamble. These changes mainly provided more specific information,
additional examples, and expanded discussions about the economic
impacts of this rule; Evidence that OMB/OIRA changes affected costs or
benefits: No; The actual costs and benefits did not appear to
change as a result of the revisions made at the request of OMB, but the
revisions did provide more information on and support for APHIS'
analysis of the economic impacts of the rule; Evidence that outside
parties contacted OMB/OIRA: No.
GAO ID: 6; Executive order review submission: Plant Pest
Regulations; Update of Current Provisions; Proposed rule; RIN 0579-
AA80; OIRA review period: 03/21/2001 to 09/26/2001; Published 10/
09/2001 (66 FR 51340); Nature of most significant OMB/OIRA changes:
Other material changes; APHIS identified five main changes
that OMB requested to the preamble of the rule, such as adding
explanations and soliciting comments and alternatives on certain
issues, all focused on improving the clarity of the rule. There were no
changes to the regulatory language; Evidence that OMB/OIRA changes
affected costs or benefits: No; Although the paperwork burden
estimates were revised downward in the final version, there is no
indication that OIRA was the source of the revisions; Evidence that
outside parties contacted OMB/OIRA: No.
GAO ID: 7; Executive order review submission: Mexican Hass
Avocado Import Program; Final rule; RIN 0579-AB27; OIRA review
period: 10/23/2001 to 10/29/2001; Published 11/01/2001 (66 FR
55530); Nature of most significant OMB/OIRA changes: Other
material changes; Numerous changes were made to the preamble of the
rule, especially regarding responses to public comments on the proposed
rule and explanations of the agency's actions. APHIS characterized
these as changes to make the final rule "more defensible and internally
consistent." There were no changes to the regulatory language;
Evidence that OMB/OIRA changes affected costs or benefits: No;
Evidence that outside parties contacted OMB/OIRA: No; However,
OIRA focused many of its comments on suggesting revisions or expansions
of the APHIS responses to public comments on the proposed rule, and the
OIRA docket included copies of adverse comments submitted on the
proposed rule.
GAO ID: 8; Executive order review submission: Interstate
Movement of Swine Within a Production System; Final rule; RIN 0579-
AB28; OIRA review period: 09/25/2001 to 12/11/2001; Published 12/
20/2001 (66 FR 65598); Nature of most significant OMB/OIRA changes:
Other material changes; There were inserts in the Federalism
and Paperwork Reduction Act sections of the preamble. Inserts in the
Paperwork Reduction Act section added information about changes made
from proposed rule in terms of paperwork and information collection
requirements; Evidence that OMB/OIRA changes affected costs or
benefits: No; Evidence that outside parties contacted OMB/OIRA:
No.
GAO ID: 9; Executive order review submission: Chronic Wasting
Disease in Cervids; Payment of Indemnity; (Listed in OIRA's database
as: Chronic Wasting Disease in Elk; Interstate Movement Restrictions
and Payment of Indemnity); Interim final rule; RIN 0579-AB35;
OIRA review period: 01/07/2002 to 02/04/2002; Published 02/08/2002
(67 FR 5925); Nature of most significant OMB/OIRA changes:
Significant changes; The most significant change made at the
suggestion of OMB affected the cost-sharing formula, limiting the
federal indemnity payment to 95 percent. Other changes made in response
to OMB were related to cost, benefit, and risk data. Both the preamble
and the CFR section of the rule were affected by OMB-suggested
changes; Evidence that OMB/OIRA changes affected costs or benefits:
Yes; OMB changed the 100-percent reimbursement that APHIS had
proposed for the indemnity to be 95 percent. OMB also asked APHIS to
avoid citing the possible avoidance of a human disease caused by
chronic wasting disease as a benefit of this rule because this
possibility was considered remote by a Harvard risk analysis; Evidence
that outside parties contacted OMB/OIRA: No.
GAO ID: 10; Executive order review submission: Animals Destroyed
Because of Tuberculosis; Payment of Indemnity; Interim final rule;
RIN 0579-AB29; OIRA review period: 11/13/2001 to 02/11/2002;
Published 02/20/2002 (67 FR 7583); Nature of most significant OMB/OIRA
changes: Other material changes; Changes were made to the
preamble for clarification, particularly regarding APHIS's cost-
sharing policy. However, no changes were made to the regulatory
language in the CFR amendments section of the rule; Evidence that OMB/
OIRA changes affected costs or benefits: No; Evidence that
outside parties contacted OMB/OIRA: No.
GAO ID: 11; Executive order review submission: Infectious Salmon
Anemia; Payment of Indemnity; Interim final rule; RIN 0579-AB37;
OIRA review period: 03/08/2002 to 04/02/2002; Published 04/11/2002
(67 FR 17605); Nature of most significant OMB/OIRA changes:
Other material changes; OMB requested changes related to future
(post-2002) funding for the infectious salmon anemia indemnity and a
control and eradication program (e.g., clarifying that the
administration was examining how the costs of program activities,
including the payment of indemnity, are shared among the federal
government and others and, therefore, that in the future the indemnity
rate provided under this rule might change). OMB further requested that
APHIS make clear that all potential indemnity payments were subject to
the availability of funding; (An APHIS official also noted that,
before the formal review period for this action, OIRA and APHIS agreed
to make the federal share of the indemnity 60 percent. Whether this
share is any different from what would have been stated in the rule
without OIRA's input is not known.); Evidence that OMB/OIRA changes
affected costs or benefits: Unclear; The preamble changes
suggest that indemnity rates and program funding in a second indemnity/
program year might change; Evidence that outside parties contacted
OMB/OIRA: No.
GAO ID: 12; Executive order review submission: Foot-and-Mouth
Disease; Payment of Indemnity; (Listed in OIRA's database as: Foot-
and-Mouth Disease, Pleuropneumonia, Rinderpest, and Certain Other
Communicable Diseases of Livestock or Poultry; Payment of Indemnity);
Proposed rule; RIN 0579-AB34; OIRA review period: 01/17/2002 to
04/16/2002; Published 05/01/2002 (67 FR 21934); Nature of most
significant OMB/OIRA changes: Significant changes; The most
substantive changes attributed to OMB affected the regulatory language
in the Code of Federal Regulations (CFR) amendments section--
specifically, eliminating language in the original version of the rule
that would have provided compensation for care and feeding of "official
vaccinates" (livestock vaccinated as part of a foot-and-mouth
eradication program) and compensation "relating to cleaning and
disinfecting non-susceptible animals." OMB suggested other changes in
the preamble that generally provided additional justifications for the
rule and added explanations in the Regulatory Flexibility Act and
Executive Order 12866 sections. OMB also requested substantial changes
to the economic analysis and APHIS's approach in evaluating the
proposed rule's impact; Evidence that OMB/OIRA changes affected costs
or benefits: Yes; APHIS made substantial changes to the
economic analysis in response to OIRA's suggestion. Further, limiting
compensation by not covering the care and feeding of official
vaccinates or the cleaning and disinfection of non-susceptible animals
lowered the potential costs to the government of the indemnity
program; However, according to an APHIS official (and as explained
in the preamble of the proposed rule), removing these compensation
provisions could impede eradication efforts and, thus, reduce overall
benefits to society. This is because official vaccinates may be used as
a "fire wall" to prevent the spread of the disease beyond infected
animals, and owners would not be compensated for the costs of
maintaining the vaccinated animals for the time that might be
necessary, and because non-susceptible animals could spread foot-and-
mouth disease even if they cannot themselves become infected; Evidence
that outside parties contacted OMB/OIRA: No.
GAO ID: FDA.
GAO ID: 13; Executive order review submission: Exports;
Notification and Recordkeeping Requirements; Final rule; RIN 0910-
AB16; OIRA review period: 08/28/2001 to 11/27/2001; Published 12/
19/2001 (66 FR 65429); Nature of most significant OMB/OIRA changes:
Other material changes; Some of the OMB-suggested changes in
the preamble added or revised information to clarify FDA's responses to
public comments on the proposed rule. There were no changes to the
regulatory language in the CFR section of the rule; Evidence that OMB/
OIRA changes affected costs or benefits: No; Evidence that
outside parties contacted OMB/OIRA: No.
GAO ID: 14; Executive order review submission: Additional
Criteria and Procedures for Classifying Over-the-Counter Drugs as
Generally Recognized as Safe and Effective and Not Misbranded; Final
rule; RIN 0910-AA01; OIRA review period: 09/27/2001 to 12/21/2001;
; Published 01/23/2002 (67 FR 3060); Nature of most significant OMB/
OIRA changes: Other material changes; Most changes were minor
editorial revisions in the preamble, but some more substantive changes
included (a) repeating information from the analysis of impacts section
at the end of the rule on page 2, (b) inserting clarifying material
about the General Agreement on Tariffs and Trade and the World Trade
Organization to a response to comments on the proposed rule, and (c)
inserting a sentence to note that, over the next several years, FDA
expects to be able to accept electronic submissions. There were no
changes in the regulatory language of the CFR section; Evidence that
OMB/OIRA changes affected costs or benefits: No; Evidence that
outside parties contacted OMB/OIRA: No.
GAO ID: 15; Executive order review submission: Records and
Reports Concerning Experience with Approved New Animal Drugs; Interim
Final Rule; (Listed in OIRA's database at time of GAO's review as:
New Animal Drug Approval Process; Implementation of Title I of the
Generic Animal Drug and Patent Term Restoration Act (GADPTRA));
Interim final rule; RIN 0910-AA02; OIRA review period: 11/29/2001
to 01/08/2002; Published 02/04/2002 (67 FR 5046); Nature of most
significant OMB/OIRA changes: Other material changes; Some of
the changes to the preamble that were attributed to OMB added new
clarifying information or examples to the original text. OMB also
revised some of the text on the estimated reporting and recordkeeping
burdens, specifically characterizing two sections of the rule as posing
new information collection requirements over the existing requirements.
The changes attributed to OMB in the regulatory language of the CFR
section appeared to be mainly editorial in nature, although the
language in one provision on reporting requirements was changed from
"must" to "should." (Note: this rule was previously withdrawn. See GAO
ID 82.); Evidence that OMB/OIRA changes affected costs or benefits:
Unclear; Updated information on the estimated reporting and
recordkeeping burdens was included in the revised version of the rule
(replacing data from 1999 fiscal year submission reports with data from
2000 fiscal year reports), but the source of this change is not clear
in the documentation. FDA, rather than OIRA, might have initiated this
change; Evidence that outside parties contacted OMB/OIRA: No.
GAO ID: 16; Executive order review submission: Requirements for
Submission of Labeling for Human Prescription Drugs and Biologics in
Electronic Format; Proposed rule; RIN 0910-AB91; OIRA review
period: 12/14/2001 to 03/05/2002; Published 05/03/2002 (67 FR
22367); Nature of most significant OMB/OIRA changes: Other
material changes; The changes made in response to OIRA included (a)
how electronic signatures would be handled and how this would be
described in the rule and (b) the treatment and description of the
onetime capital costs associated with the reporting burden for this
rule. There were also some clarifying changes to the proposed
regulatory language in the CFR section; Evidence that OMB/OIRA changes
affected costs or benefits: No; Although the OIRA changes
affected the categorization and description of the costs of this rule-
-identifying them as onetime capital costs associated with the
reporting burdens of this proposal, where FDA's original text had said
there were no capital costs associated with this information
collection--this re-categorization did not change FDA's estimate of
total costs; Evidence that outside parties contacted OMB/OIRA:
No.
GAO ID: 17; Executive order review submission: Food Additives:
Food Contact Substances Notification System; Final rule; RIN 0910-
AB94; OIRA review period: 02/19/2002 to 05/14/2002; Published 05/
21/2002 (67 FR 35724); Nature of most significant OMB/OIRA changes:
Minor editoral changes or no changes; Only a few minor changes
were attributed to OMB, such as rewording an introductory paragraph
regarding comments received on the proposed rule and inserting one
sentence in an illustration of how FDA expected its review of
notifications to proceed in the future. The Executive Order 12866
statement in the rule was also revised to note that it was a
significant regulatory action that was reviewed by OMB, rather than the
original statement that it was not. All of these changes were in the
preamble; OMB requested no changes in the regulatory language;
(However, a substantive FDA change is reflected in the documentation.);
Evidence that OMB/OIRA changes affected costs or benefits: No;
Evidence that outside parties contacted OMB/OIRA: No.
GAO ID: 18; Executive order review submission: Efficacy Evidence
Needed for Products To Be Used Against Toxic Substances When Human
Studies Are Unethical or Unfeasible; Final rule; RIN 0910-AC05;
OIRA review period: 03/07/2002 to 05/21/2002; Published 05/31/2002
(67 FR 37988); Nature of most significant OMB/OIRA changes:
Other material changes; Additional material was inserted in the
preamble to better explain the legal authority and rationale for taking
this regulatory action. Other changes were made to FDA's response to
some public comments on the proposed version of this rule. However, no
changes were made to the regulatory language; Evidence that OMB/OIRA
changes affected costs or benefits: No; Evidence that outside
parties contacted OMB/OIRA: No.
GAO ID: 19; Executive order review submission: Investigational
New Drugs; Export Requirements for Unapproved New Drug Products;
Proposed rule; RIN 0910-AA61; OIRA review period: 03/07/2002 to
05/29/2002; Published 06/19/2002 (67 FR 41642); Nature of most
significant OMB/OIRA changes: Other material changes; The only
changes attributed to OMB were (a) expanding the citations of relevant
legal authority in the background section of the preamble and (b)
updating references to a previous Federal Register notice with a
related record keeping requirement--and noting that this particular
rule, therefore, would not contain any new record keeping requirements.
There were no changes at OMB's request in the regulatory language;
Evidence that OMB/OIRA changes affected costs or benefits: No;
Evidence that outside parties contacted OMB/OIRA: No.
GAO ID: OSHA.
GAO ID: 20; Executive order review submission: Occupational
Injury and Illness Recording and Reporting Requirements; Final rule;
RIN 1218-AC00; OIRA review period: 09/24/2001 to 10/04/2001;
Published 10/12/2001 (66 FR 52031); Nature of most significant OMB/OIRA
changes: Minor editoral changes or no changes; OIRA did not
suggest or recommend any substantive changes to this rule; (However,
OSHA initiated a substantive change to delay the effective date of
Section 1904.29(b)(7)(vi), and new language was included in the
preamble and regulatory text to accomplish this change.); Evidence that
OMB/OIRA changes affected costs or benefits: No; No changes
were suggested by OIRA; Evidence that outside parties contacted OMB/
OIRA: No.
GAO ID: 21; Executive order review submission: Procedures for
Handling of Discrimination Complaints Under Section 519 of the Wendal
H. Ford Aviation Investment and Reform Act for the 21[ST] Century;
Interim final; RIN 1218-AB99; OIRA review period: 12/21/2001 to
03/20/2002; Published 04/01/2002 (67 FR 15454); Nature of most
significant OMB/OIRA changes: Other material changes; Three
sets of changes were attributed to OIRA. In the preamble of the rule,
the changes included (a) adding information and a request for public
comment regarding the whistle-blower model that OSHA chose for this
rule and (b) identifying this rule as a significant regulatory action
(originally labeled "not significant" by OSHA). In the CFR section,
language was added to three provisions to clarify that certain
procedures would be triggered at the "request of the named person" (the
person alleged to have violated the act); Evidence that OMB/OIRA
changes affected costs or benefits: No; Evidence that outside
parties contacted OMB/OIRA: No.
GAO ID: 22; Executive order review submission: Safety Standards
for Signs, Signals, and Barricades; Final rule; RIN 1218-AB88;
OIRA review period: 12/31/2001 to 03/07/2002; Published 04/15/2002
(67 FR 18145); Nature of most significant OMB/OIRA changes:
Minor editoral changes or no changes; The only changes attributed to
OMB affected two sentences regarding EO 12866 in the preamble--
identifying this as a significant regulatory action that was reviewed
by OMB, but also noting that the rule was not an economically
significant action within the meaning of the executive order; Evidence
that OMB/OIRA changes affected costs or benefits: No; Evidence
that outside parties contacted OMB/OIRA: No.
GAO ID: 23; Executive order review submission: Occupational
Injury and Illness Recording and Reporting Requirements; Occupational
Hearing Loss; Final rule; RIN 1218-AC06; Economically
significant; OIRA review period: 05/24/2002 to 06/25/2002;
Published 07/01/2002 (67 FR 44037); Nature of most significant OMB/OIRA
changes: Other material changes; OIRA requested an additional
explanation of OSHA's method of estimating the number of recordable
hearing loss cases. OSHA added a section in the preamble in response to
OIRA's request; Evidence that OMB/OIRA changes affected costs or
benefits: No; However, the substantive insert in the preamble
explained OSHA's estimation of recordable hearing loss cases; Evidence
that outside parties contacted OMB/OIRA: No.
GAO ID: 24; Executive order review submission: Occupational
Injury and Illness Recording and Reporting Requirements; Proposed
rule; RIN 1218-AC06; Economically significant; OIRA review
period: 05/24/2002 to 06/25/2002; Published 07/01/2002 (67 FR
44124); Nature of most significant OMB/OIRA changes: Minor
editoral changes or no changes; OIRA did not suggest or recommend any
substantive changes to this rule; (OSHA initiated the only
substantive change made to the rule after it was submitted for OIRA's
review, deleting a section on state occupational safety and health
plans in the preamble. A section on state plans was later reinserted in
the version of the rule that was published in the Federal Register.
Documentation in the OIRA file for this rule showed that OSHA had
informed OIRA before reinserting the state plans section before
publication.); Evidence that OMB/OIRA changes affected costs or
benefits: No; No changes were suggested by OIRA; Evidence
that outside parties contacted OMB/OIRA: No.
GAO ID: DOT-FAA.
GAO ID: 25; Executive order review submission: Fees for FAA
Services for Certain Flights; Final rule; RIN 2120-AG17; OIRA
review period: 08/01/2001 to 08/06/2001; Published 08/20/2001 (66 FR
43680); Nature of most significant OMB/OIRA changes: Minor
editoral changes or no changes; No substantive changes were made to
this rule; Evidence that OMB/OIRA changes affected costs or benefits:
No; Evidence that outside parties contacted OMB/OIRA: No.
GAO ID: 26; Executive order review submission: Flight
Operational Quality Assurance Program; Final rule; RIN 2120-AF04;
OIRA review period: 07/30/2001 to 08/28/2001; Published 10/31/2001
(66 FR 55042); Nature of most significant OMB/OIRA changes:
Minor editoral changes or no changes; The only changes made to this
rule were minor editorial revisions, such as changing section
headings; Evidence that OMB/OIRA changes affected costs or benefits:
No; Evidence that outside parties contacted OMB/OIRA: No.
GAO ID: 27; Executive order review submission: Traffic Alert
Collision Avoidance System; Proposed rule; RIN 2120-AG90; OIRA
review period: 08/01/2001 to 10/18/2001; Published 11/01/2001 (66 FR
55506); Nature of most significant OMB/OIRA changes: Other
material changes; FAA officials provided evidence that indicates that
OIRA suggested clarification to the cost-benefit section to be more
explicit on how the benefits were determined. Direct questions from
OIRA indicate that OIRA wanted the regulation evaluation to be more
explicit regarding the rule's likely benefits. According to FAA
officials, changes made to the rule were not major, although the rule
did receive a postreview letter; Evidence that OMB/OIRA changes
affected costs or benefits: No; (However, OIRA did suggest
that DOT develop a more transparent analysis of the benefits of the
proposal.); Evidence that outside parties contacted OMB/OIRA:
No.
GAO ID: 28; Executive order review submission: Certification of
Pilots, Aircraft, and Repairmen for the Operation of Light Sport
Aircraft; Proposed rule; RIN 2120-AH19; OIRA review period: 12/
17/2001 to 01/03/2002; Published 02/05/2002 (67 FR 5368); Nature of
most significant OMB/OIRA changes: Other material changes; In
response to issues raised by OIRA, FAA added a footnote to this rule
that explained consumer surplus benefits and also clarified that
specific accident data were not counted more than once. FAA officials
characterized these changes as clarifications; (Note that a previous
version of this rule was returned by OIRA to FAA for reconsideration
[see GAO ID 73 in the table on returned rules].); Evidence that OMB/
OIRA changes affected costs or benefits: No; (However, in
response to OIRA's review, FAA added information to clarify and explain
some of the information on benefits discussed in the rule.); Evidence
that outside parties contacted OMB/OIRA: No.
GAO ID: 29; Executive order review submission: Reduced Vertical
Separation Minimum in Domestic United States Airspace; Proposed rule;
RIN 2120-AH63 (in the published rule); RIN 2120-AH68 (in OIRA's list
of reviewed rules); OIRA review period: 04/12/2002 to 05/03/2002;
Published 05/10/2002 (67 FR 31920); Nature of most significant OMB/OIRA
changes: Minor editoral changes or no changes; According to
FAA officials, only one paragraph was changed in the regulatory
evaluation, and FAA officials could not determine whether that change
was due to OIRA's suggestion. Further, the one change to the rule was
not substantive; it broke out components of a cost estimate without
changing the estimate itself; Evidence that OMB/OIRA changes affected
costs or benefits: No; Evidence that outside parties contacted
OMB/OIRA: No.
GAO ID: DOT-FMCSA.
GAO ID: 30; Executive order review submission: Revision of
Regulations and Application Form for Mexican-Domiciled Motor Carriers
to Operate in U.S. Municipalities and Commercial Zones on the U.S.-
Mexico Border; Final rule; RIN 2126-AA33; OIRA review period:
01/15/2002 to 03/01/2002; Published 03/19/2002 (67 FR 12652); Nature
of most significant OMB/OIRA changes: Minor editoral changes or
no changes; FMCSA considered the OIRA-suggested changes to be
primarily editorial or clarifying in nature and not substantive (such
as substituting numbers for percentages in a discussion of the cost-
effectiveness of this rule). However, there were substantive changes
made by FMCSA; Evidence that OMB/OIRA changes affected costs or
benefits: No; (However, FMCSA made changes to the burden-hour
estimates for the information collection associated with this rule.);
Evidence that outside parties contacted OMB/OIRA: No.
GAO ID: 31; Executive order review submission: Application by
Certain Mexican Motor Carriers to Operate Beyond U.S. Municipalities
and Commercial Zones on the U.S.-Mexico Border; Interim final rule;
RIN 2126-AA34; OIRA review period: 01/15/2002 to 03/1/2002;
Published 03/19/2002 (67 FR 12702); Nature of most significant OMB/OIRA
changes: Other material changes; OIRA suggested some revisions
or clarifications to descriptions in the preamble and regulatory
language of this rule, including noting the applicability of
immigration law, revising the rationale in some of FMCSA's explanations
or responses to public comments, and clarifying that, under the North
American Free Trade Agreement Annex, Mexican-domiciled motor carriers
may not provide point-to-point transportation services, including
express delivery services, within the United States, other than
international cargo. Other OIRA-suggested changes were largely minor
editorial changes, such as correcting the title of an application form
and substituting numbers for percentages in a discussion of the cost-
effectiveness of this rule; Evidence that OMB/OIRA changes affected
costs or benefits: No; (However, FMCSA initiated changes to
the Paperwork Reduction Act section of the preamble after submission of
the draft to OIRA. FMCSA's changes slightly reduced the estimated
burden of the information collection associated with this rule.);
Evidence that outside parties contacted OMB/OIRA: No.
GAO ID: 32; Executive order review submission: Safety Monitoring
System and Compliance Initiative for Mexico-Domiciled Motor Carriers
Operating in the United States; Interim final rule; RIN 2126-AA35;
OIRA review period: 01/15/2002 to 03/1/2002; Published 03/19/2002
(67 FR 12758); Nature of most significant OMB/OIRA changes:
Other material changes; Although most of the changes OIRA suggested
were minor (e.g., word choice), one change in the preamble appeared to
be material. At OIRA's suggestion, FMCSA added Appendix A to Part 385
for clarification. This new appendix informed Mexico-domiciled motor
carriers of the evaluation criteria that FMCSA would use to ensure
compliance with the requirements of this rule. A statement in the
original draft that the statute requires an examination of each Mexico-
domiciled carrier's drivers upon entry was also revised to say that the
examination of drivers resulting from the statute provision would allow
inspection of each Mexico carrier's drivers upon entry. Changes to the
CFR that were attributed to OIRA appeared to be minor, editorial
changes (e.g., replacing "oversight program" with "monitoring system"),
as well as rewording and reordering of sentences; Evidence that OMB/
OIRA changes affected costs or benefits: No; Evidence that
outside parties contacted OMB/OIRA: No.
GAO ID: 33; Executive order review submission: Certification of
Safety Auditors, Safety Investigators, and Safety Inspectors; Interim
final rule; RIN 2126-AA64; OIRA review period: 01/15/2002 to 03/
01/2002; Published 03/19/2002 (67 FR 12776); Nature of most
significant OMB/OIRA changes: Minor editoral changes or no
changes; The two changes attributed to OIRA were not substantive as
they dealt with minor corrections to the rule. One of the suggested
changes deleted a redundant statement, and the other corrected the
citation of a relevant executive order (changing the citation from
Executive Order 12866 to Executive Order 13211); Evidence that OMB/
OIRA changes affected costs or benefits: No; OIRA did not
suggest or recommend any substantive changes to this rule; Evidence
that outside parties contacted OMB/OIRA: No.
GAO ID: 34; Executive order review submission: Parts and
Accessories Necessary for Safe Operation; Certification of Compliance
with Federal Motor Vehicle Safety Standards (FMVSS); Proposed rule;
RIN 2126-AA69; OIRA review period: 01/15/2002 to 03/01/2002;
Published 03/19/2002 (67 FR 12782); Nature of most significant OMB/OIRA
changes: Minor editoral changes or no changes; The only change
that was attributed as being made at the request of OIRA was the
deletion of a redundant statement in the preamble-regarding the
boilerplate section on the National Environmental Policy Act; Evidence
that OMB/OIRA changes affected costs or benefits: No; Evidence
that outside parties contacted OMB/OIRA: No.
GAO ID: 35; Executive order review submission: New Entrant
Safety Assurance Process; Interim final rule; RIN 2126-AA59;
Economically significant; OIRA review period: 04/12/2002 to 05/06/
2002; Published 05/13/2002 (67 FR 31978); Nature of most significant
OMB/OIRA changes: Other material changes; The changes
attributed to requests by OIRA in the draft rule or the regulatory
evaluation included (1) requesting comments on the resource cost to the
economy of denying permanent registration, the effect on safety of
denying registration, and the assumptions FMCSA made regarding crash
rate reductions, (2) attributing designation that this was an
economically significant rule to OMB rather than FMCSA, and (3) adding
a statement on reimbursement to states of the costs incurred in
conducting safety audits (80 percent). There were no changes to the
regulatory language; Evidence that OMB/OIRA changes affected costs or
benefits: No; Although the OIRA changes added several requests
for comments on the potential economic effects and benefits of this
rule and also clarified that FMCSA would reimburse states 80 percent of
costs incurred conducting safety audits, the changes did not affect the
costs or benefits of the rule; Evidence that outside parties contacted
OMB/OIRA: No.
GAO ID: DOT-NHTSA.
GAO ID: 36; Executive order review submission: Tire Pressure
Monitoring Systems; Proposed rule; RIN 2127-AI33; Economically
significant; OIRA review period: 07/05/2001 to 07/23/2001;
Published 07/26/2001 (66 FR 38982); Nature of most significant OMB/OIRA
changes: Significant changes; Changes identified in the
material found in the NHTSA docket indicate that OIRA suggested changes
to discussions of cost and benefit estimates in the proposed rule, in
particular (a) adding statements to the preamble regarding unquantified
benefits and costs that might exist, (b) adding estimates of total
estimated costs of the two regulatory alternatives in the proposal
(original draft only provided estimates of average cost per vehicle),
(c) inserting additional information about the calculation of some
benefit estimates (e.g., range of injuries and deaths prevented,
stopping distance effects, and average tire life increases), and (d)
adding a discussion regarding the effect of human factors on the
benefits of tire pressure monitoring systems. Many of the OIRA-
suggested inserts included a request for public comments. At OIRA's
suggestion, NHTSA also deleted draft material about potential
unquantified environmental benefits; Evidence that OMB/OIRA changes
affected costs or benefits: Yes; At OIRA's suggestion,
statements were added that unquantified benefits and costs may exist
due to this rule, and public comments were requested on this issue.
OIRA also suggested the insertion of (a) additional estimates of some
costs and benefits, (b) added clarification or explanation of some
economic effects, and (c) requests for public comments on benefits and
costs of the proposed regulatory alternatives; Evidence that outside
parties contacted OMB/OIRA: No.
GAO ID: 37; Executive order review submission: Light Truck
Average Fuel Economy Standard Model Year 2004; Proposed rule; 2127-
AI68; Economically significant; OIRA review period: 01/10/2002 to
01/17/2002; Published 01/24/2002 (67 FR 3470); Nature of most
significant OMB/OIRA changes: Other material changes; OIRA
suggested the addition of an Energy Impact section. Although NHTSA did
not consider the addition of this section to be a substantive change,
it met our criteria for classifying the nature of the change in this
rule to be an "other material change."; Evidence that OMB/OIRA changes
affected costs or benefits: No; Evidence that outside parties
contacted OMB/OIRA: No.
GAO ID: 38; Executive order review submission: Federal Motor
Vehicle Improved Tire Safety Standards; Proposed rule; RIN 2127-
AI54; Economically significant; OIRA review period: 12/17/2001 to
02/22/2002; Published 03/05/2002 (67 FR 10050); Nature of most
significant OMB/OIRA changes: Minor editoral changes or no
changes; NHTSA officials could not recall any changes, substantive or
nonsubstantive, to this rule during OIRA's review; Evidence that OMB/
OIRA changes affected costs or benefits: No; Evidence that
outside parties contacted OMB/OIRA: No.
GAO ID: 39; Executive order review submission: Automotive Fuel
Economy Manufacturing Incentives for Dual Fuel Vehicles; Proposed
rule; RIN 2127-AI41; Economically significant; OIRA review
period: 12/19/2001 to 02/22/2002; Published 03/11/2002 (67 FR
10873); Nature of most significant OMB/OIRA changes: Other
material changes; Additional information was added to the
introduction and background sections of the preamble referring to the
Energy Task Force and additional public comments. There were also minor
editorial changes throughout the revised draft; Although NHTSA did
not consider OIRA's suggested changes to be substantive, we classified
the changes made to this rule as an "other material change" to Other
material changesbe consistent with our coding of the level of changes
observed in other rules; Evidence that OMB/OIRA changes affected costs
or benefits: No; Evidence that outside parties contacted OMB/
OIRA: No.
GAO ID: 40; Executive order review submission: Federal Motor
Vehicle Safety Standards; Child Restraint Systems; Proposed rule;
RIN 2127-AI34; OIRA review period: 02/26/2002 to 04/08/2002;
Published 05/01/2002 (67 FR 21806); Nature of most significant OMB/OIRA
changes: Minor editoral changes or no changes; NHTSA officials
confirmed that OIRA only suggested editorial changes on two or three
pages; Evidence that OMB/OIRA changes affected costs or benefits:
No; Evidence that outside parties contacted OMB/OIRA: No.
GAO ID: EPA-Office of Air and Radiation.
GAO ID: 41; Executive order review submission: Control of
Emissions From Nonroad Large Spark-Ignition Engines and Recreational
Engines (Marine and Land-Based); Proposed rule; RIN 2060-AI11;
Economically significant; OIRA review period: 08/01/2001 to 09/14/
2001; Published 10/05/2001 (66 FR 51098); Nature of most significant
OMB/OIRA changes: Significant changes; There were substantive
comments and changes from OMB on the preamble, CFR section, and
regulatory support document for this rule. The most substantive issue/
change was "OMB's desire to not move forward with the marine and
highway motorcycle portions of the proposal."; Evidence that OMB/OIRA
changes affected costs or benefits: Yes; Deleting some of the
regulatory scope from the original version of this rule--covering
regulation of highway motorcycles and marine engines--would reduce the
potential total costs and benefits of the rule as originally submitted
for OMB's review; (Note, however, that EPA then covered those
engines in a separate rule--see GAO ID 54.); Evidence that outside
parties contacted OMB/OIRA: Yes; Many outside parties
contacted OIRA regarding this rule, including representatives of
several environmental organizations (Natural Trails and Waters
Coalition, PIRG, Sierra Club, Bluewater Network, National Parks
Conservation Association - meeting held 08/29/2001); the National
Marine Maritime Association (meeting held 08/31/2001); the snowmobile
industry (Polaris Industries, Arctic Cat, Bombadier, and International
Snowmobile Manufacturers Association --meeting held 09/06/2001); and
the Motorcycle Riders Association (letter of 09/14/2001; meeting held
10/25/2001); (Representatives of the Vice President's Office, the
White House Council of Economic Advisors, and the Small Business
Administration also attended these meetings.).
GAO ID: 42; Executive order review submission: National Ambient
Air Quality Standard for Ozone; Proposed Response to Remand; Proposed
rule; RIN 2060-ZA11; Economically significant; OIRA review
period: 08/27/2001 to 10/25/2001; Published 11/14/2001 (66 FR
57268); Nature of most significant OMB/OIRA changes: Minor
editoral changes or no changes; There were only three minor changes
in the preamble attributed to OMB. All three changes appeared to be
rewording (rather than deleting or adding information) of statements in
the submitted version regarding EPA's views about effects "using
plausible but highly uncertain assumptions."; Evidence that OMB/OIRA
changes affected costs or benefits: No; Evidence that outside
parties contacted OMB/OIRA: No.
GAO ID: 43; Executive order review submission: Regulation to
Establish New Date Receipt of Summer Grade Reformulated Gasoline at
Terminals; Proposed rule; RIN 2060-AJ79; OIRA review period: 10/
24/2001 to 11/16/2001; Published 12/03/2001 (66 FR 60163); Nature of
most significant OMB/OIRA changes: Other material changes;
Changes were made to the preamble, CFR section, and regulatory support
document, although the CFR changes would probably not be considered
substantive even using a "possibly substantive" definition. In the
preamble, material was added regarding (a) the dates when terminals can
receive summer grade reformulated gasoline (RFG), (b) explanations of
the costs of producing more summer grade and less winter grade RFG, (c)
an explanation of the requirement to petition EPA for approval to
transfer dirty blendstocks (with a request for comment on the issue),
(d) classification of this rule as a significant regulatory action
under EO 12866, and (e) reporting burden comments from the National
Petrochemical and Refiners Association in response to a related EPA
information collection request. Original material regarding
requirements for transferring blendstocks was deleted from the
preamble. In the CFR section the only changes were incorporation by
reference of a standard test method and some minor edits. The technical
support document was changed to specify dates when terminals are
required to receive summer grade RFG and to add explanatory details on
the costs of producing more summer grade RFG; Evidence that OMB/OIRA
changes affected costs or benefits: No; Evidence that outside
parties contacted OMB/OIRA: No.
GAO ID: 44; Executive order review submission: National Emission
Standards for Hazardous Air Pollutants: Organic Liquid Distribution
(Non-Gasoline); Proposed rule; RIN 2060-AH41; OIRA review
period: 06/18/2001 to 09/19/2001; Published 04/02/2002 (67 FR
15674); Nature of most significant OMB/OIRA changes: Other
material changes; Changes attributed to OMB in the preamble of the
rule included (a) a new section regarding Executive Order 13211,
discussing energy effects of the rule, (b) new language reflecting the
rule's impact on organic liquid distribution sources, and (c) a request
for comments from the public regarding the accuracy of EPA's cost
impact estimates. There were also minor editorial changes throughout
the preamble. There were no changes to the regulatory language in the
CFR section of the proposed rule; Evidence that OMB/OIRA changes
affected costs or benefits: No; Evidence that outside parties
contacted OMB/OIRA: No.
GAO ID: 45; Executive order review submission: National Emission
Standards for Hazardous Air Pollutants: Miscellaneous Organic Chemical
Manufacturing and Miscellaneous Coating Manufacturing; Proposed rule;
; RIN 2060-AE82; OIRA review period: 06/18/2001 to 09/21/2001;
Published 04/04/2002 (67 FR 16154); Nature of most significant OMB/OIRA
changes: Minor editoral changes or no changes; EPA docket
materials appeared to identify many changes suggested by the Small
Business Administration's (SBA) Office of Advocacy, but the only
evidence of a change suggested by OMB was an e-mail message suggesting
a rewrite of two explanatory sentences in the preamble; (A side-by-
side comparison of the submitted and cleared versions of this rule in
OIRA's files indicated that there were many changes but without
attribution of the sources of those changes.); Evidence that OMB/OIRA
changes affected costs or benefits: No; Evidence that outside
parties contacted OMB/OIRA: No; Although there was no evidence
of OMB/OIRA contacts with outside parties during the formal review
period for this proposal, the EPA docket files did document a
presentation by industry representatives to OMB and SBA's Office of
Advocacy (not attended by EPA) in August 2000.
GAO ID: 46; Executive order review submission: NESHAP: Petroleum
Refineries; Catalytic Cracking Units, Catalytic Reforming Units and
Sulfur Recovery Units; Final rule; RIN 2060-AF28; OIRA review
period: 08/29/2001 to 11/27/2001; Published 04/11/2002 (67 FR
17762); Nature of most significant OMB/OIRA changes: Minor
editoral changes or no changes; The EPA docket had an OMB review
cover sheet indicating "no substantive changes." The person in charge
of developing this rule confirmed that OMB's review resulted in only a
few very minor editorial changes; Evidence that OMB/OIRA changes
affected costs or benefits: No; Evidence that outside parties
contacted OMB/OIRA: No.
GAO ID: 47; Executive order review submission: National Emission
Standards for Hazardous Air Pollutants; Surface Coating of Metal
Furniture (Surface Coating); Proposed rule; RIN 2060-AG55; OIRA
review period: 06/18/2001 to 10/24/2001; Published 04/24/2002 (67 FR
20206); Nature of most significant OMB/OIRA changes: Other
material changes; Changes in the preamble to address OMB comments
primarily inserted material for clarification and to request comments.
For example, language was added to ask for comments on EPA's maximum
achievable control technology (MACT) floor, EPA's conclusion that the
creation of subcategories was not warranted for these standards, EPA's
decision to reject regulatory options more stringent than the MACT
floor, and whether there were alternative means of monitoring
performance for add-on controls at source facilities that would be as
effective and less expensive than the proposed requirements. In
response to OMB's comments, EPA also asked that commenters provide
information in support of their comments. More detailed explanations
were added regarding (a) the subcategories issue, (b) a requirement to
determine the mass of organic hazardous air pollutants in coatings,
thinners, and cleaning materials, (c) monitoring systems, and (d) the
explanation of the equation for calculating hazardous air pollutant
emissions; Changes in the CFR section to address OMB comments
included modifying (a) the applicability section of the rule to clarify
applicability where a potential overlap may exist with EPA's wood
furniture rule and (b) the equation for calculating hazardous air
pollutant emissions; (Note that there was also a substantive change
regarding the proposed emission limits--which, in turn, affected the
estimated costs and benefits of the rule--but the materials in EPA's
docket indicated that the change was due to EPA's own reanalysis of
emissions data received from firms.); Evidence that OMB/OIRA changes
affected costs or benefits: No; (Substantive changes to the
potential costs and benefits of the rule were not attributed to a
change suggested by OMB but rather to a change EPA made to the proposed
emission limits after reanalysis of emissions data submitted by
facilities. The revised limits were less stringent than originally
proposed, leading to lower costs and lower projected emission
reductions.); Evidence that outside parties contacted OMB/OIRA:
No.
GAO ID: 48; Executive order review submission: Revisions to
Regional Haze Rule to Incorporate Sulfur Dioxide Milestones and
Backstop Emissions Trading Program for Nine Western States and Eligible
Indian Tribes; Proposed rule; RIN 2060-AJ50; OIRA review period:
11/29/2001 to 02/22/2002; Published 05/06/2002 (67 FR 30418); Nature
of most significant OMB/OIRA changes: Other material changes;
There were only a few changes in the preamble--for example, deleting
some requests for comments and an explanatory section on why EPA was
deferring to the Western Regional Air Partnership's (WRAP) judgment on
the issue of critical mass and inserting a footnote in response to
issues raised in a meeting with the Center for Energy and Economic
Development (CEED). There were no changes in the CFR section; (WRAP
is a collaborative effort of tribal governments, state governments, and
various federal agencies to implement the Grand Canyon Visibility
Transport Commission's recommendations and develop tools to comply with
EPA's regional haze regulations. CEED is a national, nonprofit
organization formed by the nation's coal-producing companies,
railroads, a number of electric utilities, equipment manufacturers, and
related organizations that advocates on behalf of the long-term
viability of coal-based electricity generation in America.); Evidence
that OMB/OIRA changes affected costs or benefits: No; Evidence
that outside parties contacted OMB/OIRA: Yes; WRAP and CEED
sent letters to OIRA on this rule, and CEED requested an EO 12866
meeting with OMB on the rule. The EPA docket included a copy of a 02/
05/2002 CEED letter to Dr. Graham (not found in the OIRA files) and an
e-mail from OIRA to EPA noting that a meeting had been scheduled at
CEED's request on that date (no record found in OIRA's files). A 02/15/
2002 letter from WRAP to Dr. Graham appeared in OIRA's docket.
GAO ID: 49; Executive order review submission: Control of
Emissions of Air Pollution From New Marine Compression Ignition Engines
At or Above 30 Liters/Cylinder; Proposed rule; RIN 2060-AJ89;
OIRA review period: 04/15/2002 to 04/30/2002; Published 05/29/2002
(67 FR 37548); Nature of most significant OMB/OIRA changes:
Significant changes; Docket materials indicated that EPA moved from
proposing to considering second tier emission standards. Specifically,
OIRA edits systematically suggested changing language regarding certain
emission [Tier 2] standards from statements "proposing" the adoption of
these standards to statements that EPA was only "considering" adoption
of the standards; Evidence that OMB/OIRA changes affected costs or
benefits: Unclear; Material in the OIRA files indicated that,
although the regulatory support document was amended, the revisions did
not affect the estimates of costs and benefits for this proposed rule.
However, it seems that a shift from actually proposing to just
considering adoption of particular emission standards should have had
some effect on the rule's potential costs and benefits; Evidence that
outside parties contacted OMB/OIRA: No.
GAO ID: 50; Executive order review submission: Consolidated
Emissions Reporting Rule; Final rule; RIN 2060-AH25; OIRA review
period: 08/27/2001 to 11/26/2001; Published 06/10/2002 (67 FR
39602); Nature of most significant OMB/OIRA changes: Significant
changes; Per review of the Paperwork Reduction Act portion of this
rule, OMB raised concerns about one portion of the Information
Collection Request (ICR). In response, EPA elected to delay compliance
with that portion of the ICR, rather than delay the compliance date of
the rule. With this change, states would not have to commence reporting
point source emissions for two types of emissions until 06/01/2004, or
later, if EPA fails to publish an approved revised ICR; Evidence that
OMB/OIRA changes affected costs or benefits: Unclear; Delaying
commencement of reporting for one subsection of the rule might have a
marginal effect on the projected costs and benefits of states'
reporting on emissions; Evidence that outside parties contacted OMB/
OIRA: No.
GAO ID: 51; Executive order review submission: National Emission
Standards for Hazardous Air Pollutants; Surface Coating for Wood
Building Products; Proposed rule; RIN 2060-AH02; OIRA review
period: 09/07/2001 to 12/07/2001; Published 06/21/2002 (67 FR
42400); Nature of most significant OMB/OIRA changes: Significant
changes; Changes were made in both the preamble and CFR sections of
the proposal. The most substantive change attributed to a request from
OMB was in the CFR section--delaying the compliance dates in two
provisions from 2 years to 3 years after the date of publication of the
final rule; At OMB's request, language also was inserted throughout
the preamble requesting specific comments on various aspects of
products and activities EPA selected for coverage in this rule.
Requests were also inserted for data on potential costs and burdens of
the rule and how they might differ by subcategories of emission
sources; Evidence that OMB/OIRA changes affected costs or benefits:
Yes; The most substantive change in the proposed regulatory
language would delay compliance dates for two of the rule's
provisions; (Note also that some of the changes in the preamble
raised questions and solicited comments about the cost-effectiveness of
elements of this proposal.); Evidence that outside parties contacted
OMB/OIRA: No.
GAO ID: 52; Executive order review submission: Proposed Rule for
Compliance Program Fees for Light-Duty Vehicles and Engines; Heavy-Duty
Vehicles and Engines; and Nonroad Engines and Motorcycles; Proposed
rule; RIN 2060-AJ62; OIRA review period: 02/01/2002 to 04/22/2002;
; Published 08/07/2002 (67 FR 51402); Nature of most significant OMB/
OIRA changes: Significant changes; Lengthy inserts were made
to the preamble and the regulatory language in the CFR section. The
most substantive change appeared to be the insertion of an entire new
section on how to qualify for reduced fees within the regulatory
provisions of the CFR section. The changes that appeared to be most
substantive in the preamble included: (a) inserting requests for
comments regarding many aspects of the proposed fee system (e.g., on
minimum fees, alternative ways to adjust fees for inflation, various
process questions, and EPA's cost analysis), (b) adding material on
special provision fee payments and applications for certain types of
manufacturers (and deleting the previous version of the basis for fee
schedules), (c) adding clarifying material defining how to calculate a
vehicle's average retail value, and (d) adding a Paperwork Reduction
Act section; Evidence that OMB/OIRA changes affected costs or
benefits: No; The changes primarily affected the explanations
of fee payments and application processes, including clarification of
how to qualify for reduced fees, but did not change EPA's estimated
costs of the proposed rule; Evidence that outside parties contacted
OMB/OIRA: No.
GAO ID: 53; Executive order review submission: Proposed Non-
Conformance Penalties for 2004 and Later Model Year Emission Standards
for Heavy-Duty Diesel Engines and Heavy-Duty Diesel Vehicles;
Proposed rule; RIN 2060-AJ73; OIRA review period: 12/10/2001 to
12/20/2001; Published 08/08/2002 (67 FR 51464); Nature of most
significant OMB/OIRA changes: Significant changes; The most
significant comments and edits conveyed from OIRA to EPA on this rule
addressed: (a) rewriting a section about an additional adjustment to
"level the playing field" and the assumptions used by EPA (OIRA's
position was that this secondary adjustment was not necessary), (b)
discount rate (OIRA's position was that, per OMB Circular A-94, it was
more appropriate to use a discount rate of 7 percent consistently
throughout the rule and regulatory impact analysis--in some instances
EPA had used a 3 percent discount rate, citing a recommendation by
EPA's Science Advisory Board), (c) fuel prices (OIRA's position was
that the estimated fuel price EPA used in its draft was excessive, and
OIRA suggested that EPA instead use a 3-to 5-year average of nationwide
fuel prices), (d) significance of this proposed rule (OIRA's position
was that the proposed rule was significant and potentially economically
significant in light of the estimated nonconformance penalties), and
(e) cost estimation (OIRA's position was that the basis for the cost
estimates was unclear, among other issues, and OIRA suggested that EPA
clarify and explicitly discuss its estimation method); (The proposed
rule as published solicited comments on use of discount rate other than
7 percent and on using a 5-year average of fuel prices. In the final
rule, EPA based its analysis on use of a 7 percent discount rate and a
5-year average for the price of fuel.); Evidence that OMB/OIRA changes
affected costs or benefits: Unclear; Overall, the actual
economic impact of the rule (and any changes made to it) is unclear
because the use of nonconformance penalties by manufacturers is
optional. According to EPA, manufacturers are likely to choose whether
or not to use nonconformance penalties based on their ability to comply
with emissions standards. Nevertheless, changes regarding the discount
rate and fuel price could have an effect on the potential costs and
benefits of this rule. (A higher discount rate reduces the present
value of future costs and benefits compared to more immediate costs and
benefits.) In particular, the discount rate changes appeared to result
in a slight decrease in the penalty amounts cited in the rule once the
discount rate is changed to 7 percent; (As noted in the revised
version of the Technical Support Document section, "Penalty Sensitivity
to Discount Rate" the net effect of using a smaller discount rate would
generally be penalties that were higher.); Evidence that outside
parties contacted OMB/OIRA: Yes; OIRA was contacted before the
formal review period by industry representatives from Cummins Inc.
(letters to OIRA on 09/13/2001, 10/12/2001, and 11/07/2001; meeting
with OIRA on 10/01/2001) and Caterpillar Inc. (letter on 10/25/2001 and
meeting on 11/14/2001), but there was no evidence of outside contacts
within the formal review period for this proposed rule; (There were
also many other documents on outside contacts in the dockets for this
rulemaking, but they were dated during OIRA's formal review period for
the final version of the rule.).
GAO ID: 54; Executive order review submission: Control of
Emissions from Spark Ignition Marine Vessels and Highway Motorcycles;
Proposed rule; RIN 2060-AJ90; OIRA review period: 01/16/2002 to
04/16/2002; Published 08/14/2002 (67 FR 53050); Nature of most
significant OMB/OIRA changes: Significant changes; There were
substantive changes in the preamble and the regulatory support
document, along with minor editorial changes. However, there did not
appear to be any substantive changes in the regulatory language of the
CFR section; Substantive changes were made in the regulatory support
document regarding some of the cost-benefit, and cost-effectiveness
estimates (e.g., cost per motorcycle, cost increases, and fuel savings
rates). In the preamble, the sections on regulatory flexibility
alternatives and the Paperwork Reduction Act were expanded, while
original language was deleted regarding (a) previous standards
accomplishing little more than a phase-out of two-stroke engines, (b)
the contributions of motorcycles and marine engines to total U.S.
emissions, (c) use of catalysts and safety concerns for marine engines,
(d) a request for comment on whether banking or trading emission
credits should be incorporated into the program, (e) total increased
costs per motorcycle, (f) a statement that fuel savings offset cost of
emission controls, and (g) a conclusion regarding cost per ton of
emission reduction; Evidence that OMB/OIRA changes affected costs or
benefits: Yes; The docket materials identified changes in
cost-benefit and cost-effectiveness estimates for this rule. In
aggregate, the estimated annual cost to manufacturers was reduced by $4
million per year and the estimated annual fuel savings was increased by
$4.3 million per year; Evidence that outside parties contacted OMB/
OIRA: Yes; Although there was no evidence of direct contact
from outside parties during the formal review period for this rule, OMB
had meetings with and received letters from several groups
(representing both industry and environmental interests) on a previous
related rule--GAO ID 41, from which this rule was spun off.
GAO ID: EPA-Office of Solid Waste and Emergency Response.
GAO ID: 55; Executive order review submission: Hazardous Waste
Management System; Standardized Permit Corrective Action; and Financial
Responsibility for RCRA Hazardous Waste Management Facilities;
Proposed rule; RIN 2050-AE44; OIRA review period: 05/10/2001 to
07/19/2001; Published 10/12/2001 (66 FR 52192); Nature of most
significant OMB/OIRA changes: Other material changes; Among
the revisions attributed to OMB in the preamble were (a) adding several
inserts requesting comments on various aspects of the rule (e.g., on
ways to reduce the burden and cost of the permitting process), (b)
adding a statement that storage of hazardous waste military munitions
should continue under the individual permitting program, (c) deleting a
short section proposing that "the regulatory agency may itself choose
to initiate your conversion to a standardized permit," (d) adding an
explanation of current regulatory responsibilities if a generator sends
waste off-site for land disposal, (e) adding several paragraphs
explaining the option of not requiring a closure plan, (f) deleting
much of a paragraph discussing differences between closure cost
estimates prepared using EPA's methodology and the estimates from
owners and operators (but leaving in a request for actual cost data and
a discussion of six options EPA considered for developing cost
estimates), (g) adding a reference to an estimation option that has a
larger reduction of burden associated with cost estimating but tends to
produce higher cost estimates, and (h) adding a paragraph regarding the
level of detail required for compliance audits. In the CFR section, the
only material change was adding language to clarify which parts of
Title 40 CFR section 124.10 apply to the Resource Conservation and
Recovery Act (RCRA) standardized permit. There were also minor
editorial changes throughout the revised rule; Evidence that OMB/OIRA
changes affected costs or benefits: No; Evidence that outside
parties contacted OMB/OIRA: No.
GAO ID: 56; Executive order review submission: Identification
and Listing of Hazardous Waste; Addition of Manganese to Appendix VIII;
Inorganic Chemical Manufacturing Waste; and CERCLA Hazardous Substance
Designation and Reportable Quantities; Final rule; RIN 2050-AE49;
OIRA review period: 09/26/2001 to 10/31/2001; Published 11/20/2001
(66 FR 58258); Nature of most significant OMB/OIRA changes:
Significant changes; Substantive changes were made throughout the
preamble and CFR section of the notice in response to OMB's comments.
Specifically, the rule as cleared by OMB deferred final action on all
elements of the original proposal related to the waste constituent
manganese (e.g., adding manganese as a regulated hazardous
constituent); Evidence that OMB/OIRA changes affected costs or
benefits: Yes; Deferring regulatory action on manganese would
also defer potential costs and benefits of the regulatory actions
originally proposed by EPA; Evidence that outside parties contacted
OMB/OIRA: Yes; OIRA was contacted by industry representatives
from the Steel Manufacturers Association and American Iron and Steel
Institute (sent letters 09/28/2001 and 10/19/2001; met with OIRA 10/16/
2001), Cookson Group (sent letters 09/26/2001 and 10/18/2001), and
Eastman (sent letter 10/08/2001); The OIRA files also indicated that
OIRA reviewed materials sent by some of these groups to the RCRA
Information Center. Cookson Group also requested a meeting with OIRA.
GAO ID: 57; Executive order review submission: Resource
Conservation and Recovery Act Burden Reduction Initiative; Office of
Solid Waste Burden Reduction Project; Proposed rule; RIN 2050-AE50;
; OIRA review period: 08/02/2001 to 10/15/2001; Published 01/17/2002
(67 FR 2518); Nature of most significant OMB/OIRA changes: Minor
editoral changes or no changes; EPA told us they made no substantive
changes to the rule. The sensitivity analysis requested by OMB also did
not result in any changes to the rule; Evidence that OMB/OIRA changes
affected costs or benefits: No; Evidence that outside parties
contacted OMB/OIRA: No.
GAO ID: 58; Executive order review submission: Amendments to the
Corrective Action Management Unit [CAMU] Rule; Final rule; RIN
2050-AE77; OIRA review period: 11/14/2001 to 12/19/2001; Published
01/22/2002 (67 FR 2962); Nature of most significant OMB/OIRA changes:
Other material changes; The changes attributed to OMB in the
redline/strikeout document were all in the preamble of the rule. In
addition to several minor editorial changes (e.g., correcting
spelling), changes attributed to OMB included (a) adding a couple of
sentences to a paragraph discussing differences between generic minimum
national design and operation standards for disposal units and
requirements for site-specific clean-ups, (b) rewording and clarifying
some statements and responses to public comments regarding a proposed
"discretionary kickout provision," (c) clarifying in one sentence, as
stated previously in the same section, that the final regulation covers
both listed and characteristic wastes, and (d) deleting some of the
text explaining why EPA was not further extending the comment period;
; (Note that the most substantive change from the original draft to the
published version of the rule--adding a new provision about allowing
disposal of "CAMU-eligible wastes" in off-site hazardous waste
landfills--was not attributed to OMB.); Evidence that OMB/OIRA changes
affected costs or benefits: No; Evidence that outside parties
contacted OMB/OIRA: No.
GAO ID: 59; Executive order review submission: NESHAPS:
Standards for Hazardous Air Pollutants for Hazardous Waste Combustors;
; Interim final rule; RIN 2050-AE79; OIRA review period: 01/09/
2002 to 01/18/2002; Published 02/13/2002 (67 FR 6792); Nature of most
significant OMB/OIRA changes: Minor editoral changes or no
changes; The only changes marked were in the preamble, and all
appeared to be minor. There were no changes in the CFR section of the
rule; Evidence that OMB/OIRA changes affected costs or benefits:
No; Evidence that outside parties contacted OMB/OIRA: No.
GAO ID: 60; Executive order review submission: NESHAPS:
Standards for Hazardous Air Pollutants for Hazardous Waste Combustors;
; Final rule; RIN 2050-AE79; OIRA review period: 01/09/2002 to 01/
18/2002; Published 02/14/2002 (67 FR 6968); Nature of most
significant OMB/OIRA changes: Minor editoral changes or no
changes; The only two changes clearly marked in the redline/strikeout
document were in the preamble and appeared to be minor. There were no
changes in the CFR section of the rule; Evidence that OMB/OIRA changes
affected costs or benefits: No; Evidence that outside parties
contacted OMB/OIRA: No.
GAO ID: 61; Executive order review submission: Gasification of
Hazardous Oil-Bearing Secondary Materials from the Petroleum Refining
Industry to Produce Synthesis Gas Fuel; Proposed rule; RIN 2050-
AE78; OIRA review period: 10/17/2001 to 01/15/2002; Published 03/
25/2002 (67 FR 13684); Nature of most significant OMB/OIRA changes:
Other material changes; There were changes on most of the
pages in the revised version of the rule. All of the substantive
changes were in the preamble, including sizeable insertions of text
that provided explanatory information not in the original version of
the rule. In particular, there were lengthy inserts requesting comments
on a variety of issues and options and also new text regarding the
potential economic impacts. There were also many minor editorial
changes throughout the preamble and some rewording in the CFR section;
Evidence that OMB/OIRA changes affected costs or benefits: No;
The changes regarding potential economic impacts just provided more
explanation of the potential benefits of this rule. The estimated costs
and benefits did not change; Evidence that outside parties contacted
OMB/OIRA: No.
GAO ID: 62; Executive order review submission: Hazardous Waste
Management System; Modification of the Hazardous Waste Program; Cathode
Ray Tubes and Mercury-Containing Equipment; Proposed rule; RIN
2050-AE52; OIRA review period: 12/21/2001 to 02/13/2002; Published
06/12/2002 (67 FR 40508); Nature of most significant OMB/OIRA changes:
Minor editoral changes or no changes; According to EPA, the
only change made at the suggestion of OMB was that EPA solicited
comments on extending the speculative accumulation time of used, broken
CRTs to "two or more years" instead of just "two years." A line-by-line
comparison of the revised and original versions of the rule in the OIRA
docket confirmed only minor changes in the preamble and no changes
evident in the CFR section of this rule; Evidence that OMB/OIRA
changes affected costs or benefits: No; Evidence that outside
parties contacted OMB/OIRA: No.
GAO ID: 63; Executive order review submission: Oil Pollution
Prevention Regulation: Non-Transportation-Related Onshore and Offshore
Facilities; Revisions; Final rule; RIN 2050-AC62; OIRA review
period: 04/27/2001 to 10/15/2001; Published 07/17/2002 (67 FR
47042); Nature of most significant OMB/OIRA changes: Other
material changes; The following changes were attributed to OMB in the
preamble of the rule: (a) added two sentences to note that EPA will
continue to evaluate and intends to request additional data and
comments on the issue of modifying secondary containment requirements
for small electrical and other types of equipment that use oil for
operating purposes, (b) deleted a total of 10 sentences in a section
about discretionary provisions in the rule--all appeared to be related
to wording changes or additional clarifications in response to
comments, (c) expanded a paragraph regarding appropriate methods of
secondary containment (e.g., factors to consider in determining whether
to install double-walled piping), (d) added a few sentences to a
paragraph in which EPA withdrew a proposed 72-hour impermeability
standard that was in the proposed rule, (e) added two sentences
explaining an editorial change made to one of the rule's provisions
(deleting unnecessary words), and (f) added sentences in a response to
public comments to note that EPA will continue to evaluate whether
provisions for secondary containment found in section 112.7(h)(1)
should be modified or revised and that EPA intends to publish a notice
asking for additional data and comment on this issue. The only two
changed sentences in the CFR section appeared to reflect minor
editorial wording changes; Evidence that OMB/OIRA changes affected
costs or benefits: No; (However, the docket materials did show
that EPA provided OIRA supplemental cost analyses as part of the
revised version of the rule.); Evidence that outside parties contacted
OMB/OIRA: No.
GAO ID: EPA-Office of Water.
GAO ID: 64; Executive order review submission: National Primary
Drinking Water Regulations: Arsenic and Clarifications to Compliance
and New Source Contaminant Monitoring; Proposed rule; RIN 2040-
AB75; OIRA review period: 06/22/2001 to 07/13/2001; Published 07/
19/2001 (66 FR 37617); Nature of most significant OMB/OIRA changes:
Other material changes; The significant OMB changes identified
by the EPA memo were all in the preamble. (There was no regulatory
language associated with this proposal.) EPA made changes to the
following seven aspects of the preamble as a result of discussions with
OMB: (1) changed questions in the requests for comments to be identical
to the language used in the charges to the three review panels, (2)
expanded the description of uncertainties in risk analysis, (3)
included information specific to the recommendations from the Science
Advisory Board on treatment technologies and from a Science Advisory
Board advisory committee on latency and income adjustments, (4)
expanded the description of latency and other income adjustments, (5)
included several clearly worded references to the health date relating
primarily to arsenic research at levels above 50 parts per billion
(ppb), and the extent to which that affects uncertainties associated
with benefits of reducing arsenic below 50 ppb, (6) made editorial
changes to the small system section to clearly indicate that EPA
identified affordable technologies, so small system variances will not
be an option, and (7) included additional wording about providing a
small government agency plan under section 203 of the Unfunded Mandates
Reform Act.); Evidence that OMB/OIRA changes affected costs or
benefits: No; Evidence that outside parties contacted OMB/OIRA:
No; (However, the OMB docket did include copies of letters and
comments dated prior to the publication of the previous related
rulemaking on 01/22/2001.).
GAO ID: 65; Executive order review submission: Minimizing
Adverse Environmental Impact From Cooling Water Intake Structures at
New Facilities Under Section 316(b) of the Clean Water Act, Phase I;
Final rule; RIN 2040-AC34; OIRA review period: 09/10/2001 to 11/
08/2001; Published 12/18/2001 (66 FR 65256); Nature of most
significant OMB/OIRA changes: Significant changes; Five major
changes to the rule were attributed to OIRA, all of which appeared to
provide greater flexibility and more alternatives to compliance with
requirements and standards in the original draft of the rule. OIRA's
five main changes were to (a) add criteria that would allow more
facilities to qualify for lower performance standards, (b) change
requirements so that facilities withdrawing between 2 million gallons
per day (MGD) and 10 MGD did not have to reduce intake flow to a
minimum level commensurate with that attained by a closed-cycle
recirculating cooling water system, (c) change a requirement so that
facilities only needed to use screens to minimize impingement mortality
of fish and shellfish if certain criteria were met, (d) add an
exception to intake flow requirements regarding cooling water intake
structures located in a lake or reservoir, and (e) add "restoration
measures" as a compliance alternative under the "Track II" compliance
alternative so that intake structure operators may implement measures
that "result in increases in fish and shellfish."; Evidence that OMB/
OIRA changes affected costs or benefits: Yes; OIRA's changes
would likely reduce the costs of the rule by providing regulated
entities more flexibility and alternatives to compliance with the
original standards and requirements of the rule. Their effect on
potential benefits is not clear. Changes to the cost estimates were
evident in the published version of the rule; Evidence that outside
parties contacted OMB/OIRA: Yes; OMB met with Riverkeeper on
09/27/2001, and with representatives from Edison Electric Institute and
EOP Group) on 10/29/2001.
GAO ID: 66; Executive order review submission: National Primary
Drinking Water Regulations: Long-Term 1 Enhanced Surface Water
Treatment Rule; Final rule; RIN 2040-AD18; OIRA review period:
06/13/2001 to 09/24/2001; Published 01/14/2002 (67 FR 1812); Nature
of most significant OMB/OIRA changes: Significant changes;
Although the EPA docket memo first stated that OMB had no significant
comments on this rule, it went on to a long discussion about two major
policy issues raised by OMB concerning (a) special primacy requirements
for states and (b) the valuation of the cost of Cryptospirdiosis used
in the economic analysis accompanying the final rule. The memo noted
that both of these issues were elevated to Dr. Graham (OIRA) and Tracy
Mehan (EPA Office of Water). OMB agreed to remove their objections to
the special primacy requirements in this rule, but indicated intent to
raise this issue in subsequent Safe Drinking Water Act regulatory
packages. To address OMB's concerns about the valuation issue, the
Office of Water and OMB agreed to expand this rule's benefit range by
using two cost-of-illness values instead of one. The memo stated that
other OMB comments were editorial in nature; (Note that the redline/
strikeout document also shows many other changes in the preamble. It
was not clear whether these were changes that were not made at the
suggestion of OMB or whether the author of EPA's Executive Order 12866
compliance memo did not consider changes to the preamble to be
substantive.); Evidence that OMB/OIRA changes affected costs or
benefits: Yes; In response to OMB's concern about EPA's
valuation of the cost of Cryptospirdiosis used in the economic
analysis, OMB and the Office of Water agreed to expand the rule's
benefit range by using two cost-of-illness values instead of one. This
second COI estimate that was added was lower and only valued lost work
time and medical costs associated with Cryptospirdiosis. The other
estimate remained the same as EPA's original and valued all loss
categories included in the original published study used by EPA
(valuing losses for medical costs, work time, productivity, and leisure
time); Evidence that outside parties contacted OMB/OIRA: No.
GAO ID: 67; Executive order review submission: Effluent
Guidelines and Standards for the Meat Products Point Source Category
(Revisions); Proposed rule; RIN 2040-AD56; OIRA review period:
12/21/2001 to 01/28/2002; Published 02/25/2002 (67 FR 8582); Nature
of most significant OMB/OIRA changes: Other material changes;
OMB and SBA suggested changes in two sections of the preamble of the
proposed rule. In response to those suggestions, EPA: (a) revised the
pretreatment discussion in the preamble to restate the results from
EPA's preliminary data collection on meat and poultry product indirect
dischargers and related POTW interference events and (b) added a
lengthy paragraph in response to OMB's and SBA's request to provide a
more thorough explanation of how EPA developed four different
production size classifications for each meat and poultry product
subcategory; Evidence that OMB/OIRA changes affected costs or
benefits: No; Evidence that outside parties contacted OMB/OIRA:
No.
GAO ID: 68; Executive order review submission: National
Pollutant Discharge Elimination System: Proposed Regulations to
Establish Requirements for Large Cooling Water Intake Structure at
Existing Power Generating Facilities; Proposed rule; RIN 2040-AD62;
; Economically significant; OIRA review period: 12/28/2001 to 02/28/
2002; Published 04/09/2002 (67 FR 17122); Nature of most significant
OMB/OIRA changes: Significant changes; EPA identified major
changes made at the suggestion or recommendation of OIRA in both the
preamble and CFR sections of the proposed rule. Overall, these OIRA
changes lowered the performance standard in the rule and made
compliance requirements more flexible by allowing, among other things,
options for a site-specific approach to minimizing environmental harm.
The changes also broadened a restoration option, whereby firms may
restore environmental harm rather than comply with the designated
performance standard; Many changes to the proposed rule language in
eight sections of the proposed CFR amendments were attributed to OIRA.
The most extensive changes were to sections 125.94 (10 of 14 major
changes in this section were attributed to OIRA) and 125.95 (previously
125.96 - all 7 major changes identified in this section were attributed
to OIRA). For example OIRA suggested removing a requirement that
facilities in estuaries and tidal waters withdrawing greater than 1
percent of the tidal excursion volume, and oceans withdrawing greater
than 500 MGD meet performance standards for reducing mortality and
entrainment based on reducing flow commensurate with a closed-cycle,
recirculating cooling system and replaced it with a requirement for all
facilities in estuaries, tidal rivers, and oceans (regardless of flow)
to reduce both impingement mortality and entrainment based on the
performance of fish return systems and fine mesh screens; OIRA also
suggested broadening the scope of restoration measures to allow use
under all compliance alternatives, adding language that allows
restoration measures to be used in lieu of design and construction
technologies and operational measures to meet performance requirements
of the rule; Evidence that OMB/OIRA changes affected costs or
benefits: Yes; OIRA recommended that EPA select a regulatory
alternative that OIRA believed would yield substantially greater net
benefits. The approach that EPA originally proposed would have cost an
estimated $610 million per year, with estimated benefits of $890
million per year, yielding net benefits of $280 million. However, OIRA
recommended that EPA select another approach that, while having
estimated benefits of $735 million, was expected to cost only $280
million, yielding net benefits of $455 million; Evidence that outside
parties contacted OMB/OIRA: Yes; Industry groups, such as
Edison Electric Institute, EOP Group, and Cinergy, sent letters and
provided materials to OIRA. Representatives of those groups and Public
Service Electric and Gas, TXU, Progress Energy, Teco Energy,
Constellation Energy Group, Allegheny Energy, Minnesota Power, and
Migrant Corp. met with OIRA on 02/08/2002. Riverkeeper (an
environmental interest group) met with OMB on 02/07/2002.
GAO ID: 69; Executive order review submission: Final Revisions
to the Clean Water Act Regulatory Definition of "Fill Material" and
"Discharge of Fill Material"; Final rule; RIN 2040-AD51; OIRA
review period: 05/01/2002 to 05/02/2002; Published 05/09/2002 (67 FR
31129); (Note that this was a joint rulemaking of the Department of
the Army's Corps of Engineers and EPA.); Nature of most significant
OMB/OIRA changes: Significant changes; The most substantive
change attributed to OIRA in the preamble and regulatory language of
the rule revised the definition of fill material as follows - "The term
fill material does not include trash, or garbage, or similar materials
unless such materials are to be used to create any structure or
infrastructure in waters of the United States, such as an artificial
reef or berm. (According to an EPA official, the impact of the change
was to make the definition clearer so that fill material permit
applicants could not ask to use trash or garbage as fill material in
creating a structure or infrastructure.) Many of the other OIRA-
suggested changes revised discussions of relevant court actions and
decisions related to this rulemaking; Evidence that OMB/OIRA changes
affected costs or benefits: Unclear; Revising original
regulatory language to exclude the possible use of trash, garbage, or
similar materials as fill material for some purposes might affect
potential costs and environmental benefits; Evidence that outside
parties contacted OMB/OIRA: No; There was no evidence of
contact before or during OIRA's formal review. However, in a joint
letter dated 05/03/2002, one day after OIRA cleared this rule, 10
environmental groups--American Rivers, Clean Water Action,
Earthjustice, Friends of the Earth, League of Conservation Voters,
Mineral Policy Center, National Audubon Society, National Wildlife
Federation, Natural Resources Defense Council, and the Sierra Club--
contacted Dr. Graham regarding this rule; (The OIRA files also
included a newspaper article that referred to a meeting between the
National Mining Association and OMB on 04/06/2001. However, meeting
records we reviewed indicated only that EPA attended a meeting with the
National Mining Association on that date; there was no mention of
whether anyone from OMB also participated.).
GAO ID: 70; Executive order review submission: Effluent
Limitation Guidelines and New Source Performance Standards for the
Construction and Development Category; Proposed rule; RIN 2040-
AD42; Economically significant; OIRA review period: 03/01/2002 to
05/15/2002; Published 06/24/2002 (67 FR 42644); Nature of most
significant OMB/OIRA changes: Significant changes; There were
substantive changes in both the proposed regulatory options in the CFR
amendments and the preamble discussion of those regulatory options. At
the suggestion or recommendation of OIRA, the proposed regulation no
longer included the storm water management or postconstruction
regulatory options from the original draft. Also, the active
construction options were changed to identify and discuss the following
three regulatory options: (1) inspection and certification of
construction site erosion and sediment controls, for sites one acre or
larger, (2) codification of the Construction General permit plus
inspection and certification requirements, for sites five acres or
larger, and (3) no regulation. The revisions to the regulatory proposal
required corresponding revisions to the preamble; Evidence that OMB/
OIRA changes affected costs or benefits: Unclear; The memo in
EPA's docket regarding OIRA changes did not directly address whether
there were changes in the potential costs and benefits of the rule. The
EPA docket did not include sufficient information to allow for a
detailed comparison of revised cost and benefit data. However, the
nature of the changes made to the regulatory options should have had
some effect on the proposed rule's potential costs and benefits;
Evidence that outside parties contacted OMB/OIRA: Yes; The
OIRA files on this rulemaking included a document from the ELG Working
Group (a coalition of interested trade associations) entitled "Issues
Raised By The Construction and Development Effluent Limitations
Guidelines Working Group Before the White House Office of Management
and Budget Office of Information and Regulatory Affairs" (dated 02/04/
2002 - about 1 month prior to the formal review period).
GAO ID: 71; Executive order review submission: Effluent
Limitations Guidelines, Pretreatment Standards, and New Source
Performance Standards for the Iron and Steel Manufacturing Point Source
Category; Final rule; RIN 2040-AC90; OIRA review period: 03/29/
2002 to 04/30/2002; Published 10/17/2002 (67 FR 64216); Nature of
most significant OMB/OIRA changes: Significant changes; At the
suggestion of OMB, EPA revised the regulation and supporting preamble
discussion for the "water bubble" provision (a voluntary regulatory
flexibility mechanism to allow for trading of identical pollutants at
any single steel facility with multiple compliance points). This change
eliminated an existing minimum net reduction provision that had applied
if facilities used the water bubble alternative; Evidence that OMB/
OIRA changes affected costs or benefits: Unclear; As described
in the existing regulation that this rule was amending, the water
bubble provision had a minimum net reduction provision--if a facility
used this tool, the amount of the pollutant discharges pursuant to the
bubble had to be 10 percent to 15 percent less than the discharges
otherwise authorized by the rule without the bubble. At the suggestion
of OMB, the revised final rule eliminated this minimum net reduction
provision; However, the net effect on costs and benefits of this
rule are unclear. While this change eliminated a requirement for
additional reductions in pollutant discharges if the water bubble tool
is used, it also provided greater flexibility for facilities to use
this tool to achieve the overall pollutant reductions required by 40
CFR 420 at the least cost; Evidence that outside parties contacted
OMB/OIRA: Yes; Representatives of industry groups contacted
OIRA prior to OIRA's formal review period for this rulemaking. On 03/
04/2002, representatives of the Steel Manufacturers Association and the
Specialty Steel Industry of North America sent a letter to Dr. Graham
with comments and a request for a meeting. On 03/19/2002, OIRA held a
meeting with steel industry representatives (including those who
requested the meeting on March 4); (Note also that the OIRA files on
its review of this rule indicated that OIRA had reviewed the
substantive comments from the proposed rule stage. The water bubble
provision was the subject of some of the public comments on the
proposed rule, with industry groups generally supportive of expansions
of the water bubble flexibilities and environmental groups supportive
of restrictions on the water bubble.).
Source: GAO analysis.
[End of table]
Table 8: Findings and Determinations for Rules Returned to Agency after
Submission to OIRA:
GAO ID: DOT-FAA.
GAO ID: 72; Executive order review submission: Part 145
Review: Repair Stations; Final rule; RIN 2120-AC38; OIRA review
period: 07/13/2001 to 07/20/2001; Reason for OIRA's return:
OIRA cited concerns from other federal agencies and unease about
complicating relations with other countries in its rationale for
returning the rule; DOT officials confirmed that the Department of
State voiced concerns about the wording of certain provisions. However,
they pointed out that FAA had worked out wording changes with the
Department of State prior to submitting the rule for OIRA's review.
They believed that OIRA's request that FAA withdraw the rule (see GAO
ID 84) and OIRA's subsequent return of the resubmitted rule (this case)
were based on an OIRA misunderstanding that the Department of State's
concerns had not been addressed; Evidence that outside parties
contacted or met with OIRA regarding this submission: Yes;
On 07/09/2001--2 days before FAA withdrew the original submission of
this rule--the Aeronautical Repair Station Association, the Airline
Suppliers Association and other business representatives sent a letter
to the OMB Director with a copy to OIRA asking that OIRA send the rule
back to FAA with instructions to prepare a Supplemental Notice of
Proposed Rulemaking; On 07/26/2001--about 1 week after OIRA returned
the rule to FAA and FAA resubmitted to rule to OIRA--OIRA met with
representatives from the Aeronautical Repair Station Association,
Aerospace Industries Association, Air Transport Association of America,
Aircraft Electronics Association, Aircraft Owners and Pilots
Association, Airline Suppliers Association, General Aviation
Manufacturers Association, National Air Carrier Association, National
Air Transport Association, Professional Aviation Maintenance
Association, The Boeing Company, General Electric Aircraft Engines,
Goodrich, Honeywell, Rockwell Collins, and United Technologies
Corporation; Evidence of subsequent activity regarding this
submission: There were a series of activities regarding this
rule both before and after this return. On 07/02/2001, FAA submitted a
draft of this rule for OIRA's review. On 07/11/2001, FAA withdrew the
rule (at OIRA's suggestion according to FAA officials.) (This
withdrawal is covered by GAO ID 84.); On 07/13/2001, FAA resubmitted
the rule for OIRA's review, and OIRA returned it on 07/20/2001 (the
sequence covered by this particular case). That same day FAA
resubmitted the rule to OIRA; On 07/30/2001, OIRA completed its
review of the rule (with the outcome coded "consistent with no
change"). The rule was published on 08/06/2001 (66 FR 41088).
GAO ID: 73; Executive order review submission: Certification
of Pilots, Aircraft and Repairmen for the Operation of Light Sport
Aircraft; Proposed rule; RIN 2120-AH19; OIRA review period: 07/
06/2001 to 08/09/2001; Reason for OIRA's return: OIRA returned
this rule because of concerns that the regulatory analysis did not
adequately support the rule. OIRA noted that FAA used a baseline with
which to compare the rule that assumed that, in the absence of this
rule, FAA would propose a more stringent set of standards than in the
proposal. Although OIRA had no objection to FAA analyzing an
alternative that was more stringent than the proposal, OIRA believed
that the benefits of the proposal should be compared with a status quo
that did not include the artificial "baseline" assumption of increased
stringency. OIRA also suggested that, as part of an improved analysis
of alternatives, FAA could also consider means of improved compliance
and enforcement of regulations currently in place; Given these
concerns, OIRA suggested that DOT publish an advanced notice of
proposed rulemaking before publishing the specific proposal and
returned the rule to DOT for reconsideration; Evidence that outside
parties contacted or met with OIRA regarding this submission:
No; Evidence of subsequent activity regarding this submission:
FAA reexamined its regulatory evaluation and resubmitted the rule to
OIRA on 12/17/2001; OIRA completed its review of the resubmitted
rule on 01/03/2002 (outcome code "consistent with change") (see GAO ID
28); The proposed rule was published on 02/05/2002 (67 FR 5368).
GAO ID: 74; Executive order review submission: Corrosion
Control Plan; Proposed rule; RIN 2120-AE92; OIRA review period:
03/02/2001 to 09/18/2001; Reason for OIRA's return: OIRA
returned this rule because of concerns about the agency's regulatory
analysis, primarily related to the cost-benefit analysis. Many of these
same concerns applied to the analysis of a related FAA rule on aging
aircraft. (See related rule at GAO ID 76.) Although FAA responded to
some of these concerns in a revised regulatory evaluation on 07/27/
2001, OIRA suggested that a concurrent review of this rule and the
aging aircraft rule would help resolve OIRA's concerns and assist in
determining the most cost-effective way to detect and correct problems
affecting the safety of aging aircraft. Because resolution of these
concerns would take additional time, OIRA returned the two rules to DOT
and FAA for reconsideration; Evidence that outside parties contacted
or met with OIRA regarding this submission: No; Evidence of
subsequent activity regarding this submission: On 06/18/2002,
FAA resubmitted this rule to OIRA; On 09/16/2002, OIRA completed its
review of the resubmitted rule (outcome code "consistent with no
change"); The proposed rule was published on 10/03/2002 (67 FR
62142).
GAO ID: 75; Executive order review submission: Retrofit of
Improved Seats in Air Carrier Transport Category Airplanes; Proposed
rule; RIN 2120-AC84; OIRA review period: 05/14/2002 to 05/16/2002;
Reason for OIRA's return: According to the OIRA database, this
rule was returned to FAA because it was an improper submission;
However, FAA officials disputed that characterization. They stated that
OIRA "had a slew of questions" to which FAA gave a 12-page response.
They said that, after the return and an exchange of OIRA suggestions
and FAA's response, FAA added language to further explain the plan for
improving the seat certification process; Evidence that outside
parties contacted or met with OIRA regarding this submission:
No; Evidence of subsequent activity regarding this submission:
On 06/17/2002, FAA resubmitted this rule for OIRA's review; OIRA
completed its review of the resubmitted version on 09/24/2002 (outcome
code "consistent with change"); The proposed rule was published on
10/04/2002 (67 FR 62294).
GAO ID: 76; Executive order review submission: Aging Airplane
Safety; Final rule; RIN 2120-AE42; OIRA review period: 07/27/
2001 to 09/18/2001; Reason for OIRA's return: OIRA returned
this rule due to concerns about the regulatory analysis. Many of these
same concerns applied to the analysis of a related FAA corrosion
control plan rule (GAO ID 74). Although FAA responded to some of these
concerns in a revised regulatory evaluation on 07/27/2001, OIRA
believed that a concurrent review of this rule and the corrosion
control plan rule would help resolve OIRA's concerns and assist in
determining the most cost-effective way to detect and correct problems
affecting the safety of aging aircraft. Because resolution of these
concerns would take additional time, OIRA returned the two rules to
DOT-FAA for reconsideration; Evidence that outside parties contacted
or met with OIRA regarding this submission: No; Evidence of
subsequent activity regarding this submission: On 06/18/2002,
FAA resubmitted this rule to OIRA; On 09/24/2002, OIRA completed its
review (outcome code "consistent with change"). According to FAA, the
changes were to issue this as an interim final rule with a request for
comment, instead of as a final rule, and to expand the benefit analysis
in the regulatory evaluation; The interim final rule was published
on 12/06/2002 (67 FR 72726).
GAO ID: 77; Executive order review submission: Revision of
Digital Flight Data Recorder Regulations for Boeing 737 Airplanes and
for Part 125 Operators; Final rule; RIN 2120-AG87; OIRA review
period: 06/14/2001 to 09/18/2001; Reason for OIRA's return:
OIRA returned this rule due to concerns about the relative cost-
effectiveness of requiring additional flight data recorder parameters,
in light of additional steps that would be proposed in a related notice
of proposed rulemaking on general flight recorder improvements;
Evidence that outside parties contacted or met with OIRA regarding this
submission: No; Evidence of subsequent activity regarding this
submission: The final rule is still pending, according to FAA
officials.
GAO ID: DOT-NHTSA.
GAO ID: 78; Executive order review submission: Tire Pressure
Monitoring Systems; Final rule; RIN 2127-AI33; Economically
significant; OIRA review period: 12/17/2001 to 02/12/2002; Reason
for OIRA's return: OIRA returned this rule because it did not
believe the analysis performed by NHTSA adequately demonstrated that
the agency selected the best available alternative; Specifically,
OIRA returned the rule for reconsideration of two analytic concerns
related to safety. First, OIRA identified a regulatory alternative that
NHTSA had not explicitly analyzed--considering the impact of regulatory
alternatives on the availability of anti-lock brake systems. Second,
OIRA said that the technical foundation for NHTSA's estimates of safety
benefits needed to be better explained and subjected to sensitivity
analysis; Evidence that outside parties contacted or met with OIRA
regarding this submission: Yes, prior to the formal review
period; On 10/26/2001, OIRA and DOT officials met with
representatives of the Alliance of Automobile Manufacturers and various
member companies, including Daimler-Chrysler, Ford, Toyota, and VW of
America; (There was also a meeting after the formal review period -
on 02/21/2002 - with the Rubber Manufacturers' Association.); Evidence
of subsequent activity regarding this submission: On 05/28/
2002, NHTSA submitted a final rule to OIRA that contained the changes
suggested by OIRA in the return letter; OIRA completed its review of
the rule on 05/29/2002 (outcome code "consistent with no change");
The final rule was published on 06/05/2002 (67 FR 38704); The U.S.
Court of Appeals recently held that the rule was contrary to the intent
of the tire safety legislation and arbitrary and capricious under the
APA. Public Citizen, Inc. v. Mineta, No. 02-4237 (2d Cir. Aug. 6,
2003).
GAO ID: EPA-Office of Air and Radiation.
GAO ID: 79; Executive order review submission: FY 2000 Report
to Congress on EPA's Implementation of the Waste Isolation Pilot Plant
Land Withdrawal Act; Proposed rule; RIN 2060-ZA12; OIRA review
period: 09/13/2001 to 10/17/2001; Reason for OIRA's return:
OIRA returned this item because it was an improper submission;
Evidence that outside parties contacted or met with OIRA regarding this
submission: No; Evidence of subsequent activity regarding this
submission: N/A.
GAO ID: EPA-Office of Water.
GAO ID: 80; Executive order review submission: Federal Water
Quality Standards for Indian Country and Other Provisions Regarding
Federal Water Quality Standards; Proposed rule; RIN 2040-AD46;
OIRA review period: 06/29/2001 to 10/02/2001; Reason for OIRA's
return: OIRA's return letter cited a number of concerns about
this rule. In particular, the return letter noted that EPA did not
provide a quantitative analysis of the costs and benefits that would
result from this action. OIRA pointed out that the preamble identified
nearly 300 point sources on tribal lands that would be directly
affected by the rule and that there might be substantial numbers of
nonpoint sources and point sources upstream of tribal lands that could
also be affected. OIRA therefore stated that the rule could benefit
from further analysis of costs and benefits in order to support
informed public comment. OIRA was also concerned with EPA's conclusion
that this proposed rule did not have federalism implications. OIRA
noted that some of the impacts of this rule on states were likely to be
significant (e.g., affecting state permitting activities in upstream
waters), but the rule did not appear to contain any requirements for
consultation with states. OIRA was also concerned that the rule
appeared to establish for the first time EPA jurisdiction over waters
whose Indian country status is in dispute; Evidence that outside
parties contacted or met with OIRA regarding this submission:
No; Evidence of subsequent activity regarding this submission:
No; According to an EPA official, EPA has not resubmitted this rule
to OIRA.
Source: GAO analysis.
[End of table]
Table 9: Findings and Determinations for Rules Withdrawn after
Submission to OIRA:
GAO ID: APHIS.
GAO ID: 81; Executive order review submission: Importation of
Clementines From Spain; Proposed rule; RIN 0579-AB40; OIRA review
period: 04/26/2002 to 05/21/2002; Did the agency withdraw this
submission at the suggestion or recommendation of OIRA?: The
withdrawal was characterized by APHIS as a mutual decision by APHIS and
OIRA; Reason for withdrawal of the submitted rule: According to
APHIS, OIRA and APHIS mutually decided to withdraw this rule to avoid
violating the 90-day limit on reviews under Executive Order 12866;
Evidence that outside parties contacted or met with OIRA regarding this
submission: No; Evidence of subsequent activity regarding this
submission: APHIS resubmitted the rule to OIRA on 06/28/2002;
OIRA completed review of the rule on 07/05/2002 (outcome code
"consistent with change"). According to APHIS, OIRA had some changes to
better explain the basis for the rule and to address concerns by
Spanish clementine exporters. APHIS also noted that some changes were
made to the regulatory language in response to the U.S. Trade
Representative's Office; The rule was published on 07/11/2002 (67 FR
45922).
GAO ID: FDA.
GAO ID: 82; Executive order review submission: Records and
Reports Concerning Experience with Approved New Animal Drugs; Final
Rule; (Listed in OIRA's database at time of GAO's review as: Records
and Reports Concerning Experience with Approved New Animal Drugs;
Implementing of Title I of the Generic Animal Drug and Patient [sic]
Term Restoration Act); Final rule; RIN 0910-AA02; OIRA review
period: 08/28/2001 to 11/26/2001; Did the agency withdraw this
submission at the suggestion or recommendation of OIRA?: FDA
characterized the withdrawal as a mutual decision by FDA and OIRA;
Reason for withdrawal of the submitted rule: According to FDA,
OIRA and FDA made a mutual decision to withdraw the original final rule
and reissue it as an interim final rule. Issuing this rule as an
interim final rule with an opportunity for public comment was a
compromise decision to address OMB's concerns regarding the length of
time since publication of the proposed rule (12/17/1991) while not
further delaying the rule by reproposing it; Evidence that outside
parties contacted or met with OIRA regarding this submission:
No; Evidence of subsequent activity regarding this submission:
FDA resubmitted the rule to OIRA on 11/29/2001; OIRA completed
review of the rule on 01/08/2002 (outcome code "consistent with
change"). According to FDA, OIRA had some clarifying comments, but
these were not substantive (see GAO ID 15 in this appendix for
additional details); An interim final rule was published on 02/04/
2002 (67 FR 5046). (The interim final rule was published again on 07/
31/2002, delaying the effective date indefinitely in order to address
Paperwork Reduction Act of 1995 requirements and comments received on
the interim final rule.).
GAO ID: 83; Executive order review submission: Current Good
Manufacturing Practice in Manufacturing, Packing, or Holding Dietary
Ingredients and Dietary Supplements; Proposed rule; RIN 0910-AB88;
; Economically significant; OIRA review period: 03/28/2001 to 12/19/
2001; Did the agency withdraw this submission at the suggestion or
recommendation of OIRA?: No; The Department of Health and
Human Services (HHS) withdrew the rule; Reason for withdrawal of the
submitted rule: According to FDA, this rule previously had been
submitted to OIRA for review but was initially withdrawn in response to
the Card memo. Although FDA then resubmitted this rule to OIRA in March
2001, new policy makers in HHS wanted to reconsider the rule.
Therefore, HHS decided to again withdraw the rule from OIRA's review;
Evidence that outside parties contacted or met with OIRA regarding this
submission: No; Evidence of subsequent activity regarding this
submission: FDA resubmitted a version of this rule to OIRA on
10/04/2002; OIRA completed review of the resubmitted rule on 01/16/
2003 (outcome code "consistent with change"); The proposed rule was
published on 03/13/2003 (68 FR 12158).
GAO ID: DOT-FAA.
GAO ID: 84; Executive order review submission: Part 145 Review:
Repair Stations; Final rule; RIN 2120-AC38; OIRA review period:
07/02/2001 to 07/11/2001; Did the agency withdraw this submission at
the suggestion or recommendation of OIRA?: Yes; According to
FAA, the agency withdrew the rule at OIRA's suggestion; Reason for
withdrawal of the submitted rule: FAA officials stated that OIRA
suggested the withdrawal due to "concerns from industry and the State
department."; Evidence that outside parties contacted or met with OIRA
regarding this submission: Yes; On 07/09/2001--2 days before
the withdrawal--the Aeronautical Repair Station Association, the
Airline Suppliers Association, and other business representatives sent
a letter to OMB Director with a copy to OIRA asking that it send the
rule back to FAA with instructions to prepare a Supplemental Notice of
Proposed Rulemaking; (On 07/26/2001--after the withdrawal and also
after OIRA's 07/20/2001 return of this draft rule--OIRA met with these
business representatives.); Evidence of subsequent activity regarding
this submission: (See chronology presented under GAO ID 72,
which covers the version of this rule that was returned by OIRA for
reconsideration by DOT-FAA.).
GAO ID: DOT-NHTSA.
GAO ID: 85; Executive order review submission: Light Truck
Average Fuel Economy Standard Model Year 2004; Final rule; RIN
2127-AI68; Economically significant; OIRA review period: 11/29/
2001 to 12/12/2001; Did the agency withdraw this submission at the
suggestion or recommendation of OIRA?: No; NHTSA withdrew the
rule; Reason for withdrawal of the submitted rule: According to
NHTSA officials, they withdrew the rule because the agency did not want
to promulgate fuel economy standards under the congressional freeze
imposed when the rule was drafted, as it appeared that the freeze would
soon be lifted (as it was on 12/18/2001); Evidence that outside
parties contacted or met with OIRA regarding this submission:
No; Evidence of subsequent activity regarding this submission:
NHTSA resubmitted a proposed rule to OIRA on 01/10/2002; OIRA
completed review of the proposed rule on 01/17/2002 (outcome code
"consistent with change" - see GAO ID 37 in this appendix for
additional information); The proposed rule was published on 01/24/
2002. A final rule was published on 04/04/2002 (67 FR 16052).
Source: GAO analysis.
[End of table]
[End of section]
Appendix III: Case Studies on Significantly Affected Rules With
Evidence That OIRA Was Contacted by External Parties:
The case studies described in this appendix include significantly
affected rules that also had evidence of external party contact with
OIRA during the review process. For each case, a description of the
rule as submitted to OIRA, external party contact with OIRA, and
changes ultimately made at OIRA's suggestion are included.
Control of Emissions from Nonroad Large Spark Engines:
GAO ID 41 Agency: EPA RIN: 2060-AI11 Rulemaking stage at time of
review: Proposed Date submitted to OMB for review: August 1, 2001
Date OMB review completed: September 14, 2001 Result of review:
Consistent with change:
Rule as Submitted to OIRA:
On August 2, 2001, OIRA formally received a draft rule from EPA that
proposed emission standards for several groups of nonroad engines.
These engines include large spark-ignition engines, such as those used
in forklifts and airport tugs; recreational vehicles using spark-
ignition engines, such as off-highway motorcycles, all-terrain
vehicles, and snowmobiles; and recreational marine diesel and highway
motorcycle engines.
Outside Parties' Contacts with OIRA:
In communications with OIRA, marine and highway motorcycle industry
representatives objected to being covered by the proposed rule
standards. The Motorcycle Riders Foundation sent a letter (dated
September 14, 2001) to the OIRA Administrator stating that EPA should
defer the proposed rule's coverage of highway motorcycles. According to
the letter, "there is no court-ordered deadline for this part of the
regulation, and the EPA isn't otherwise under pressure to rush to
regulation." The National Marine Manufacturers Association (NMMA)
expressed similar concerns. A memo summarizing a meeting with OIRA and
EPA on August 31, 2001, indicated that "the key issues raised by NMMA
were a federal commitment to delay action on exhaust standards coupled
with working with NMMA, Coast Guard and California on catalyst
technology.":
Changes Made to Rule at OIRA's Suggestion:
A redline/strikeout version of the rule in EPA's docket containing
"edits representing discussions between EPA and OMB on September 14"
reflects deletions of language covering marine vessels with spark
engines and highway motorcycles. Language in the published proposed
rule states: "We intended to include in this proposal emission
standards for two additional vehicle categories: new exhaust emission
standards for highway motorcycles and new evaporative emission
standards for marine vessels powered by spark-ignition engines.
Proposals for these two categories are not included in the September 14
deadline mandated by the courts, as is the case for the remaining
contents that appear in today's proposed rule. We are committed to
issue proposals regarding these categories within the next two to three
months.":
The proposed rule was published in the Federal Register October 5,
2001. The marine and highway motorcycle portions of the proposal were
covered in a later proposed rulemaking, which was published in the
Federal Register August 14, 2002.
Proposed Nonconformance Penalties for 2004 and Later Model Year
Emission Standards for Heavy-duty Diesel Engines and Heavy-duty Diesel
Vehicles:
GAO ID 53 Agency: EPA RIN: 2060-AJ73 Rulemaking stage at time of
review: Proposed Date submitted to OMB for review: December 10, 2001
Date OMB review completed: December 20, 2001 Result of Reviews:
Consistent With Change:
Rule as Submitted to OIRA:
On at least four occasions EPA sent versions of the proposed rule
preamble to OIRA previous to OIRA's formal review period. The exchanges
began October 30, 2001, and OIRA's official review period was logged as
beginning December 10, 2001. In the first draft rule sent to OIRA, EPA
proposed that nonconformance penalties (NCP) be made available for the
2004 and later model year nonmethane hydrocarbons and nitrogen oxides
standard for heavy-duty diesel engines and vehicles. According to the
proposal, the availability of NCPs allows a manufacturer of heavy-duty
engines or heavy-duty vehicles whose engines or vehicles fail to
conform with certain applicable emission standards, but do not exceed a
designated upper limit, to be issued a certificate of conformity upon
payment of a monetary penalty. In the technical support document
accompanying the rule preamble, EPA originally used a 3 percent
discount rate in calculating certain compliance and fuel costs which
were then used in calculating NCP amounts.
Outside Parties' Contacts with OIRA:
Regulated parties sent comments to OIRA and met with OIRA officials on
several occasions before OIRA's official review of this rule began.
From what is available in the OIRA meeting logs, some of the
discussions concerned whether the rule would advantage or disadvantage
certain engine manufacturers. (Available documents do not indicate that
regulated parties suggested OIRA's primary revision to the rule--an
increase in the discount rate used in the regulatory impact analysis.)
OIRA's contact with external parties regarding the proposed version of
this rule is described below.
On September 13, 2001, Cummins Inc. sent a letter to the OIRA
Administrator requesting a meeting "to discuss an important regulation
which has very serious competitive ramifications for our Company - the
2004 Nonconformance Penalty for Heavy Duty Engines." On October 1,
2001, OIRA, EPA, DOE met with Cummins Inc. to discuss the rule. Several
days later (on October 12, 2001) Cummins Inc. sent a letter to the OIRA
Administrator thanking him for the October 1, 2001, meeting and
requested that the rule not harm engine manufacturers that produce
compliant engines. On October 25, 2001, another engine manufacturer
(Caterpillar) requested a meeting with OIRA regarding the heavy-duty
diesel engine rule; the meeting was held November 14, 2001. On November
7, 2001 Cummins sent additional comments on the rule to the OIRA
Administrator urging "expeditious review" of the rule.
Changes Made to Rule at OIRA's Suggestion:
OIRA initiated an increase (from 3 percent to 7 percent) in the
discount rate used in parts of the regulatory impact analysis for this
rule. Some members of EPA's Environmental Economics Advisory Council
recommended use of the 3 percent rate. OIRA's suggested change lowered
the NCPs levied in the rule from the amounts originally proposed by
EPA.
Most of OIRA's suggested changes to the discount rate occurred before
OIRA's official review period. However, EPA did not completely switch
to the 7 percent discount rate before the official review period began.
In a draft submitted December 4, 2001, (about one week before OIRA's
official review period began), the 3 percent discounted values remained
and a table was added showing certain values if a 7 percent discount
rate were used. Additional language also requested comment on which
discount rate would be more appropriate.
OIRA's rationale for increasing the discount rate is offered in the
following correspondence with EPA: "We believe that it is more
appropriate to use a discount rate of 7% (see OMB circular A-94)
consistently throughout the rule, representing the opportunity cost of
capital. Since the EPA NCP Cost Survey instructs respondents to
discount by 3% and report net present value estimates for the fixed
costs, hardware cost, warranty cost, and maintenance/operating cost,
please discuss the necessary adjustments used in presenting NPB
estimates, in the first version of the proposal, for these cost
categories using the 7% discount rate." The rationale for a 7 percent
discount rate is also included in a separate fax sent to EPA. By the
time the proposed rule was published in the Federal Register, all
discount rate discussion in the rule used a 7 percent rate. However,
the following language is included in the rule regarding potential use
of a different rate for portions of the impact analysis and an example
of nonconformance penalty parameters using a 3 percent discount rate is
included in the technical support document:
"— there is evidence in other contexts that users might apply a
different discount rate than seven percent when considering future
operating costs during a purchase decision. We request comment on
whether there is evidence to support the application of such an
alternative discount rate to operating costs in the various segments of
the heavy duty engine market. Your comments in support of an
alternative discount rate (a higher or lower value) should include a
discussion of the supporting economic and business rationale for the
alternative rate. We have included an example of the impact on the NCP
parameters from using a smaller discount rate (three percent) in the
draft Technical Support Document for this proposal.":
Identification and Listing of Hazardous Waste (Manganese):
GAO ID 56 Agency: EPA RIN: 2050-AE49 Rulemaking stage at time of
review: Final Date submitted to OMB for review: September 26, 2001 Date
OMB review completed: October 31, 2001 Result of review: Consistent
with change:
Rule as Submitted to OIRA:
On September 26, 2001, EPA submitted a draft final rule to OIRA for
review listing manganese and two other wastes generated from inorganic
chemical manufacturing processes as "hazardous constituents." EPA said
in the draft rule that it was adding manganese to the list "based on
scientific studies demonstrating that manganese has toxic effects on
humans." The agency said manganese had long been known to cause
neurological effects in occupational settings, a "continuum of
dysfunction" with low levels of exposure, and a danger to individuals
with a hepatic insufficiency. EPA also cited evidence from
epidemiological studies that point to negative health impacts of low-
level exposure to manganese in drinking water. After considering public
comments on the proposed rule, the agency refuted commenters' claims
that manganese is not hazardous and said "we continue to believe that
manganese is toxic and clearly poses significant risk to human health."
EPA also said that, "based on consultations with individuals
knowledgeable in hazardous waste treatment and corrective action, a
review of the chemical properties of manganese, and review of Resource
Conservation and Recovery Act (RCRA) regulations, the Agency does not
believe that there are significant, incremental costs or economic
impacts associated with adding manganese to [the list of hazardous
constituents].":
Outside Parties' Contacts with OIRA:
Also on September 26, 2001, legal counsel for the Cookson Group (an
international materials technology organization) sent a letter to OIRA
stating that the cost of the final rule to Cookson would be
significantly higher than EPA estimated. The letter indicated that
Cookson was obligated to manage and dispose of slag materials at a
Laredo, Texas smelter that it once owned, and that the rule would
classify this slag as hazardous waste--thereby costing the company an
additional $29 million to $36 million. The letter also indicated that
the "Laredo slag constitutes well over 90 percent of the material that
will likely be subject to this rulemaking over the next 30 years."
Later, on October 18, 2001, the counsel for the Cookson Group sent
another letter to OMB requesting a meeting to discuss the "significant
impact of the [rule] on Cookson at a former facility in Laredo, TX,
which impact was not known to and considered by EPA when formulating
the rule.":
On September 28, 2001, counsel for the Steel Manufacturers Association
and the American Iron and Steel Institute requested a meeting with the
OIRA Administrator to discuss "the failure of [EPA] to conduct any
analysis of the impact of the proposal on the steel industry, the
country's largest consumer and user of manganese." On October 16, 2001,
OIRA and EPA officials met with the organizations' counsels. Three days
later, the counsel sent a letter to an OIRA official thanking him for
the meeting and stating that listing manganese as hazardous could harm
the steel industry due to increased costs for treating manganese-
contaminated waste.[Footnote 83]
On October 8, 2001, the Eastman chemical company sent a letter to the
OIRA Administrator stating that the company "strongly opposes adding
manganese to [the listing of hazardous constituents] because of its
very low toxicity and the substantial costs it would impose on
facilities outside the inorganic chemicals industry, with no resultant
environmental or health benefits.":
Changes Made to Rule at OIRA's Suggestion:
On October 31, 2001, OIRA's review of the rule ended, and the rule was
coded as "consistent with change." A memo dated the same day was placed
in the EPA docket submitting a "redline/strikeout" version of the rule
showing the changes made "in response to comments from OMB." All
language in the rule related to listing manganese as hazardous had been
deleted. The following language was inserted in the text.
"We received numerous comments related to the risk associated with
manganese and the economic impact to many industries, including the
steel industry, of adding manganese to the Universal Treatment
Standards requirements and to 40 CFR 261. Appendix VIII. Although we
continue to believe that manganese poses significant issues that
ultimately should be resolved, the court ordered schedule under which
we are operating provides us with no flexibility to take additional
time to explore these topics more fully. As a result, we have chosen to
defer final action on [manganese].":
The final rule was published in the Federal Register on November 20,
2001. As of May 30, 2003 EPA had not published a rule regarding
manganese.
Minimizing Adverse Environmental Impact from Cooling Water Intake
Structures at New Facilities:
GAO ID 65 Agency: EPA RIN: 2040-AC34 Rulemaking stage at time of
review: Final Date submitted to OMB for review: September 10, 2001 Date
OMB review completed: November 8, 2001 Result of review: Consistent
with change:
Rule as Submitted to OIRA:
The draft version of the rule submitted to OIRA on September 10, 2001,
implemented section 316 (b) of the Clean Water Act for new facilities
(primarily electric power plants) that use water withdrawn from rivers,
streams, lakes, reservoirs, estuaries, oceans or other waters of the
U.S. for cooling purposes. The draft rule established national
technology-based performance requirements applicable to the location,
design, construction, and capacity of cooling water intake structures
at new facilities. The national requirements also established the best
technology available (referred to as a "closed-cycle recirculating
cooling water system") for minimizing adverse environmental impacts
associated with the use of these structures. The primary adverse
environmental impact due to these structures is casualties among
aquatic life forms (e.g., fish and shellfish).
The draft rule used a two-track approach to achieve technology based
performance requirements. Track I established national intake capacity
and velocity requirements as well as location-and capacity-based
requirements to reduce intake flows to certain levels. This performance
standard was to be commensurate with that produced by a closed-cycle
recirculating cooling water system. Track II allowed permit applicants
to conduct site-specific studies to demonstrate that alternatives to
Track I would result in the same level of reduction of impingement and
entrainment at the cooling water intake structure as would be achieved
under Track I.
Outside Parties' Contacts with OIRA:
Riverkeeper met with OIRA and EPA officials on September 27, 2001,
regarding the rule and advocated "dry-cooling" as the technology basis
for the final rule.
On October 29, 2001, industry representatives (from EOP Group and
Edison Electric Institute) met with OIRA and EPA officials. The
industry representatives recommended that the final rule: (1) use the
level of harm reduction in impingement and entrainment as the "point of
departure to compare Track I and II," (2) allow different impingement
and entrainment performance if the system minimizes total adverse
environmental impacts, (3) eliminate the proposal for additional design
and construction technologies, (4) allow alternative systems if
achieving the Track I system performance is not a cost-effective
reduction in adverse environmental impacts.
Changes Made to Rule at OIRA's Suggestion:
Five substantive changes were made to the rule due to OIRA's
suggestions.
* As originally written, EPA allowed facilities to qualify for
alternative performance requirements that were less stringent than
those required by the rule. OIRA suggested adding one additional
criterion allowing qualification for less stringency if full compliance
"would result in significant adverse impacts on local air quality,
significant adverse impacts on local water resources not addressed
under Section 125.84 (d) (1) (i), or significant adverse impacts on
local energy markets." This additional criterion could have the effect
of allowing more facilities to qualify for lower performance standards.
* As originally written, facilities withdrawing between 2 million
gallons per day (MGD) and 10 MGD had to meet the performance
requirements imposed on facilities with higher MGD withdrawal amounts.
OIRA suggested changing the requirements so that facilities withdrawing
between 2 MGD and 10 MGD did not have to reduce intake flow to a
minimum level commensurate with that attained by a closed-cycle
recirculating cooling water system. However, all other specifications
remained applicable (e.g., through-screen intake velocities and total
design intake flow requirements remained the same despite the OIRA
change).
* As originally written, intake structures were required to use screens
in order to minimize impingement mortality of fish and shellfish. OIRA
suggested changing the requirement so that the facilities only needed
to use the screens if certain criteria were met (e.g., if there are
threatened or endangered species or habitat for these species within
the hydraulic zone of the intake structure, if species of interest to
fishery management agencies pass through the hydraulic zone, or if the
primary performance requirements of the rule would not sufficiently
ease stress on protected species or habitat.):
* As originally written, one of the intake flow requirements specified
by EPA stated that "for cooling water intake structures located in a
lake or reservoir, the total design intake flow must not alter the
natural thermal stratification or turnover pattern of the source
water." OIRA suggested adding an exception to this requirement by
inserting the following language: "—except in cases where the
disruption is determined to be beneficial to the management of
fisheries for fish and shellfish by any fishery management agency
(ies).":
* As originally written, EPA offered "Track II" compliance measures
that allowed facility operators to comply with the performance standard
of the rule through means other than a closed-cycle recirculating
cooling water system. OIRA suggested adding "restoration measures" as a
compliance alternative under the "Track II" compliance alternative so
that intake structure operators may implement measures that "result in
increases in fish and shellfish.":
The final rule was published in the Federal Register December 18, 2001.
Subsequently, on December 26, 2002, EPA published a direct final rule
in order to make "minor changes to EPA's final rule published December
18, 2001." However, on March 24, 2003, EPA withdrew the direct final
rule "due to adverse comments.":
National Pollutant Discharge Elimination System (Existing Intake
Structures):
GAO ID 68 Agency: EPA RIN: 2040-AD62 Rulemaking stage at time of
review: Proposed Date submitted to OMB for review: December 28, 2001
Date OMB review completed: February 28, 2002 Result of review:
Consistent with change:
Rule as Submitted to OIRA:
The proposed rule would have implemented section 316(b) of the Clean
Water Act for certain existing power producing facilities that employ a
cooling water intake structure and that withdraw 50 million gallons per
day or more of water from rivers, streams, lakes, reservoirs,
estuaries, oceans, or other waters of the U.S. for cooling purposes.
According to the legislative history, section 316(b) "requires the
location, design, construction, and capacity of cooling water intake
structures of steam-electric generating plants to reflect the best
technology available for minimizing any adverse environmental
impacts.":
As submitted to OIRA on December 28, 2001, the draft proposed rule
required that large facilities in estuaries and tidal rivers meet a
uniform, national performance standard commensurate with a closed-
cycle, recirculating cooling system that would reduce impingement
mortality and entrainment.
Outside Parties' Contacts with OIRA:
On January 15, 2002, EPA provided OIRA with a copy of slides from a
presentation that the Public Service Electric and Gas (PSEG) Company
made to EPA on January 3, 2002, regarding the section 316(b)
rulemaking. The slides recommend a "streamlined site-specific approach"
for the rule instead of uniform, national standards.
On January 23, 2002, Riverkeeper (an environmental group) sent a letter
to the OIRA Administrator requesting a meeting on the rule. February 7,
2002, OIRA and EPA officials met with officials from Riverkeeper, who
said Congress mandated that best technology available standards be
nationally uniform and technology based--not set on a cases-by-case
basis or related to the quality of the water involved. They also said
that the use of site-specific best technology available determinations
had perpetuated "the most destructive 'once-through' technology."
Finally, they argued that leaving best technology available
determinations to a case-by-case, site-specific determination "puts a
tremendous burden on State regulatory agencies, as well as
environmental and citizens groups.":
On January 28, 2002, OIRA received an e-mail indicating "PSEG has
prepared draft language for implementing Section 316(b) on a site-
specific basis." The draft posited that permittees could demonstrate
compliance with section 316(b) in any of three ways: (1) a
demonstration based on a prior Section 316(b) determination, (2) a
demonstration based on a site-specific evaluation of the best
technologies or other measures for minimizing adverse effects, or (3) a
demonstration to determine the presence of any adverse environmental
effects. The draft concluded by saying that "voluntary restoration or
conservation measures may be used, in conjunction with or instead of
technologies, to demonstrate that a [cooling water intake structure] is
not causing (adverse environmental impact)." On January 31, 2002, OIRA
received a fax from the EOP Group (a consulting company) containing
identical draft section 316(b) regulations "for Site-Specific Permit
Renewal Options for Existing Sources.":
In February 2002, the Edison Electric Institute prepared a paper
advocating a site-specific approach to regulating intake structures
that are managed by states. (We discovered the document in the OIRA
docket for the rule, although it is not clear how the paper was
submitted to OIRA).
On January 31, 2002, Cinergy Corporation sent a letter to the OIRA
Administrator requesting a meeting with him on the proposed rule. The
Edison Electric Institute sent a similar letter on February 4, 2002. On
February 8, 2002, OIRA and EPA officials met with officials from a
number of regulated parties, including "TXU" (meaning unclear),
Cinergy, Public Service Enterprise Group, Edison Electric Institute,
Progress Energy, Teco Energy, Constellation Energy Group, Allegany
Energy, Minnesota Power, and Mirant Corporation. Documents submitted at
the meeting advocate a "site-specific approach" as "the best means for
ensuring cost-effective environmental protection." The documents also
indicated that the uniform technology standards "would be based upon
performance standards that could only be met by retrofitting to closed
cycle cooling for some or all power plants covered under the Phase II
rule." In addition, the documents indicated that retrofitting 40
percent of existing open cycle capacity would cost $40 billion, that
wide-scale construction outages could affect regional power supplies,
and increased air emissions could result from lower-efficiency closed-
cycle systems.
On February 27, 2002, OIRA received a fax from the EOP Group forwarding
letters that EPA had received from the states and others on the section
316(b) rule. The letters were signed by representatives from the
Pennsylvania Department of Environmental Protection, the Marine Mammal
Commission, the Texas Natural Resource Conservation Commission, the
Office of the Governor of the State of North Carolina, and the Illinois
Environmental Protection Agency.
Changes Made to Rule at OIRA's Suggestion:
On February 14, 2002, EPA submitted a summary of the revised regulatory
proposal to OMB. The summary stated that permittees could chose one of
three alternatives for establishing the best technology for minimizing
adverse environmental impact at its facility--(1) demonstrate that
existing technologies and measures meet regulatory performance
standards, (2) demonstrate that technologies and measures selected by
the permittee will meet performance standards, and (3) demonstrate that
a site-specific determination of best technology available is
appropriate. The summary went on to say that restoration could be used
in lieu of or in combination with intake technologies and operational
measures if the results could be shown to be comparable to the results
obtained from compliance with the regulatory standards.
In its summary of changes made during interagency review, one of the
changes that EPA identified as having been suggested by OIRA was "added
new regulatory framework that provides three compliance alternatives
for the Phase II existing facility rule.":
On February 28, 2002, OIRA approved the rule as revised. The rule was
published in the Federal Register on April 9, 2002.
Effluent Limitation Guidelines and New Source Performance Standards for
the Construction and Development Category:
GAO ID 70 Agency: EPA RIN: 2040-AD42 Rulemaking stage at time of
review: Proposed Date submitted to OMB for review: March 1, 2002 Date
OMB review completed: May 15, 2002 Result of review: Consistent with
change:
Rule as Submitted to OIRA:
As originally submitted to OIRA, the draft proposed rule would have
established effluent limitations for 150,000 construction firms. The
draft contained a number of regulatory options to control discharges
from active construction sites of one acre or larger (temporary erosion
and sediment controls applicable to construction sites while land is
being disturbed - three options) and long-term storm water discharges
(postconstruction, long-term storm water management options intended as
permanent storm water controls - three options). EPA's preferred option
combination contained two major provisions. For active construction
sites, it would have codified EPA's current construction general
permit, along with a design goal of 80 percent reduction in total
suspended solids (TSS) discharged from sites and a series of enhanced
inspection and certification requirements to improve
compliance.[Footnote 84] EPA's preferred option for management of
postconstruction storm water run-off would have established a design
goal of an 80 percent reduction in TSS discharge from finished projects
and a requirement to maintain peak runoff levels at pre-construction
levels.
Outside Parties' Contacts with OIRA:
ELG Working Group (an industry association) met with OIRA and EPA on
February 4, 2002 and argued that additional storm water regulations for
the construction and development industry are "unnecessary and
unwarranted" because construction and development activities "have been
subject to federal, state and often local regulations for controlling
storm water discharges since 1990." In a document prepared for the
meeting, the ELG Working Group suggested that the federal government
should encourage state and local flexibility to address water quality
issues.
Changes Made to Rule at OIRA's Suggestion:
In a memo regarding interagency review, dated May 22, 2002 with no
author listed, changes to the rule while under OIRA review are
identified, including a change that dropped the postconstruction
requirements from the proposed rule. The memo stated that "given the
requirement to address postconstruction runoff in the Phase I and Phase
II municipal stormwater program, EPA determined that it would be more
appropriate to support local communities in developing tailored
programs that could better reflect regional and local conditions, and
be better integrated into broader local planning efforts.":
According to a June 10, 2002, memo (the memo author was not
identified), the agency made several changes to the proposed regulation
at the suggestion or recommendation of OIRA. The proposed regulation no
longer included the storm water management, or postconstruction,
regulatory options. Also, the active construction options changed.
These changes consisted of identifying and discussing three regulatory
options: (1) inspection and certification of construction site erosion
and sediment controls, for sites one acre or larger, (2) codification
of the Construction General Permit, plus inspection and certification
requirements, for sites five acres or larger, and (3) no regulation.
These revisions to the regulatory proposal required corresponding
revisions to the preamble.
On June 24, 2002, the proposed rule was published in the Federal
Register.
Effluent Limitations Guidelines for the Iron and Steel Manufacturing
Point Source Category:
GAO ID 71 Agency: EPA RIN: 2040-AC90 Rulemaking stage at time of
review: Final Date submitted to OMB for review: March 29, 2002 Date
OMB review completed: April 30, 2002 Result of review: Consistent with
change:
Rule as Submitted to OIRA:
The draft rule as submitted to OIRA for review revised technology-based
effluent limitations guidelines and standards for certain wastewater
discharges associated with metallurgical cokemaking, sintering, and
ironmaking operations. In its original form, the rule would have
retained an existing minimum net reduction provision in regulations
regarding use of a "water bubble" mechanism. According to the rule
preamble, the "water bubble" is a regulatory flexibility mechanism that
allows trading of identical pollutants at any single steel facility
with multiple compliance points to realize cost savings and/or to
facilitate compliance. Under the existing regulations, facilities that
used the water bubble mechanism were required to reduce the amount of
their pollutant discharges pursuant to the bubble to 10 percent to 15
percent less than the discharges otherwise authorized by the
regulations without use of the bubble. This additional reduction was
referred to as the "minimum net reduction" provision throughout the
rule.
Outside Parties' Contacts with OIRA:
Counsel for Steel Manufacturers Association and Specialty Steel
Industry of North America met with OIRA and EPA officials to discuss
this rulemaking on March 19, 2002. In the letter requesting a meeting,
the industry counsel argued that "revised effluent limitation
guidelines are not technically, economically, or legally justified."
The counsel further specified aspects of EPA's cost-benefit analysis
that were believed to be flawed, said that the actual cost-benefit
ratio for this rule was at least 100:1, and asserted that the rule
would be the "most cost-ineffective ELG [effluent limitation guideline]
ever promulgated.":
Changes Made to Rule at OIRA's Suggestion:
The major change in this final rule that was attributed to a request
from OIRA eliminated the existing minimum net reduction provision that
applied if facilities used a "water bubble" alternative. Because of the
elimination of this minimum net reduction provision, facilities that
trade pollutants in accordance with the water bubble mechanism are not
required to reduce pollutant discharges to be 10 percent to 15 percent
less than the discharges otherwise authorized by the rule without use
of the water bubble (as had been required by the existing provision).
This water bubble provision was the subject of public comments on EPA's
proposed rule, with industry groups generally supportive of the water
bubble flexibilities and environmental groups advocating restrictions
on the water bubble. The OIRA files on its review of this draft final
rule indicated that OIRA had reviewed the substantive comments EPA
received on the proposed rule.
On October 17, 2002, the final rule was published in the Federal
Register.
Tire Pressure Monitoring Systems:
GAO ID 78 Agency: DOT-National Highway Traffic Safety Administration
(NHTSA) RIN: 2127-AI33 Rulemaking stage at time of review: Final Date
submitted to OMB for review: December 17, 2001 Date OMB review
completed: February 12, 2002 Result of Review: Returned:
Rule as Submitted to OIRA:
As submitted to OIRA for review, the draft final rule would have
established a standard under which all new vehicles would be required
to have a tire pressure monitoring system (TPMS). The rule would have
allowed automobile manufacturers to use either of two types of systems
until October 31, 2006 --a "direct" system that measures the pressure
in each tire or an "indirect" system that uses a vehicle's antilock
brake system to sense tire pressure differences by monitoring the speed
of tire revolution. However, after October 31, 2006, the rule would
have required manufacturers to use only the direct monitoring systems.
Outside Parties' Contacts with OIRA:
On October 26, 2001--3 months after the Notice of Proposed Rulemaking
was published in the Federal Register and almost 2 months before the
draft final rule was submitted to OIRA for review--OIRA and NHTSA
officials met with representatives from the Alliance of Automobile
Manufacturers and representatives from individual auto manufacturers
(Toyota, Ford, Volkswagen, and Daimler Chrysler). According to a
summary of the meeting prepared by NHTSA and placed in the DOT docket,
most of the comments presented by the industry representatives were
similar to those in their filed written comments concerning such issues
as legislative intent, assumptions about costs and benefits, the
validity of test data on stopping distance, the number of vehicles
operating with more than one significantly underinflated tire, and the
safety benefits of antilock braking systems. In its March 23, 2001,
comments on the proposed rule, the Alliance of Automobile Manufacturers
said it "believes that both wheel-speed based [indirect] and pressure-
sensor based [direct] TPMS have merit, and should be permitted under
pending requirements. Our proposal will allow the further development
of both types of systems.":
On October 31, 2001, the Alliance sent letter to the OIRA Administrator
reiterating views regarding the draft final rule. The Alliance
expressed concern that the structure of the final rule would have the
effect of eliminating indirect tire pressure monitoring systems as a
compliance option. According to the letter:
"The Alliance has seen no evidence in the rulemaking record to suggest
that real world safety benefits that may accrue from tire pressure
monitoring systems will be noticeably different between systems using
indirect and direct sensing technologies. Absent such evidence, the
Alliance believes that the final rule should be carefully structured to
allow, at a minimum, current systems employing either type of sensing
technology - indirect or direct - to be used as compliance options. As
additional field experience is developed through the implementation of
this mandate, NHTSA may in the future exercise its long-standing
authority to initiate rulemaking to enhance the performance
requirements for tire pressure monitoring systems as may be warranted
by valid engineering and performance data. The rule should also be
structured to assure the timely and orderly implementation by providing
a reasonable phase-in period.":
OIRA officials also met with representatives from the Rubber
Manufacturers Association regarding the rule on February 21, 2002--9
days after OIRA returned the rule for reconsideration. However, because
NHTSA officials did not attend the meeting because of agency policy,
there is no summary of the meeting available. An e-mail attached to the
OIRA meeting log stated that, according to an OIRA branch chief, "this
is not an (Executive Order 12866) meeting, since the rule is no longer
here for review." Nevertheless, OIRA listed the meeting on its Web
site.
Changes Made to Rule at OIRA's Suggestion:
According to the February 12, 2002, return letter, OIRA said "NHTSA
needs to provide a stronger analysis of the safety issues and benefits,
including a formal analysis of a regulatory alternative that would
permit indirect systems after the phase-in period. Moreover, NHTSA
could analyze an option that would defer a decision about the ultimate
fate of indirect systems for several more years, until the potential
impact on installation of anti-lock brake systems is better
understood.":
According to a July 24, 2002, NHTSA memo, the agency changed the draft
rule at OIRA's suggestion to "permit vehicle manufacturers to use
current indirect TPMSs as their means of complying with the standard."
The new draft final rule established two compliance options for a
period beginning November 1, 2003, and ending October 31, 2006. During
this period, automobile manufacturers would be allowed to use either
direct or indirect TPMSs. Meanwhile, NHTSA said that it would conduct
additional studies and would leave the rulemaking docket open for the
submission of new data and analysis. NHTSA said the second part of the
rule will be issued by March 1, 2005, and will set performance
standards to become effective November 1, 2006. Depending on the data
developed during the first period, the performance standards issued in
2005 could require direct monitoring systems (as in the draft final
rule as submitted to OIRA), or they could reach some other
determination (e.g., continue to allow the use of indirect systems).
On May 28, 2002, NHTSA resubmitted the draft final rule for OIRA
review. The next day, OIRA approved the rule "consistent with no
change." On June 5, 2002, the final rule was published in the Federal
Register.[Footnote 85]
Part 145 Review: Repair Stations:
GAO IDs 84 and 72 Agency: DOT-FAA RIN: 2120-AC38 Rulemaking stage at
time of review: Final Dates submitted to OMB for review: July 2, 2001;
resubmitted July 13, 2001; resubmitted July 20, 2001 Dates OMB review
completed: July 11, 2001 (withdrawn); July 20, 2001 (returned); July
30, 2001 (consistent with no change) Result of Reviews: Withdrawn,
returned, consistent with no change:
Rule as Submitted to OIRA:
As submitted to OIRA on July 2, 2001, the rule updated and revised the
regulations for repair stations. Specifically, the rule reorganized the
requirements applicable to repair stations to reduce duplication of
regulatory language and eliminate obsolete information. In addition,
the rule established new definitions applicable to repair stations and
updated requirements relating to repair station certification; housing,
facilities, equipment, materials, and data; personnel; and operations.
The rule also eliminated, where practicable, distinctions between
repair stations based on geographical location.
Outside Parties' Contacts with OIRA:
On July 9, 2001, the Aeronautical Repair Station Association (ARSA) and
other industry representatives sent a letter to the Director of OMB
(with copies to the Deputy Administrator of OIRA and other OIRA
officials and staff) requesting that OIRA send the Part 145 rule back
to FAA "with instructions to prepare a Supplemental Notice of Proposed
Rulemaking (SNPRM) to address all of the issues needed to modernize
Part 145.":
On July 26, 2001, ARSA and other industry representatives met with OIRA
officials and an official from the Department of Commerce (but no one
from FAA) to discuss the Part 145 rule. (DOT officials told us that
they generally do not attend meetings with industry representatives at
OMB.) In their presentation to OIRA, the industry representatives
repeated their request that a supplemental notice of proposed
rulemaking be issued instead of the final rule. They also requested
that guidance material be issued at the same time that the final rule
is issued and that a more realistic compliance date be set.
Actions Taken at OIRA's Suggestion:
On July 11, 2001, FAA withdrew the rule from OIRA review. An FAA
chronology of the rulemaking process stated that OMB "asked FAA to
withdraw the final (rule)." That same day, counsel to ARSA testified
before the House Subcommittee on Aviation on the FAA rulemaking
process, and attached the above-mentioned July 9, 2001, letter to his
statement. During our review, the counsel told us that he did not know
whether OIRA had requested that FAA withdraw the Part 145 rule, but
said any such action on OIRA's part "had nothing to do with us.":
On July 13, 2001, FAA resubmitted the rule to OIRA for review. FAA
officials told us that the resubmitted rule was identical to the rule
submitted to OIRA on July 2, 2001. On July 20, 2001, OIRA returned the
rule to FAA for reconsideration. In his return letter, the Deputy
Administrator of OIRA said that the Department of State and the Office
of the United States Trade Representative indicated that certain
language in the rule could be read by other governments as a "needs
test" for foreign repair stations that would "raise a significant issue
of our compliance with applicable international trade agreements."
However, FAA officials told us that they had already addressed the
Department of State's concerns. Therefore, they said FAA resubmitted
the rule to OIRA (unchanged from its previous submission) on the same
day as the return letter--July 20, 2001.
On July 30, 2001, OIRA approved the rule as "consistent with no
change," and did not suggest that FAA make the changes that the
industry representatives recommended. On August 8, 2001, FAA published
the final rule in the Federal Register.
[End of section]
Appendix IV: Status of 23 High Priority Review Rules:
In its May 2001 draft report on the costs and benefits of federal
regulations, the Office of Information and Regulatory Affairs (OIRA)
within the Office of Management and Budget requested that the public
provide it with "suggestions on specific regulations that could be
rescinded or changed that would increase net benefits to the public by
either reducing costs and/or increasing benefits." In its December 2001
final report, OIRA said it had received 71 suggestions in response to
its request. The report also indicated that OIRA had completed an
initial review of the suggestions and placed each of the suggestions
into one of three categories: (1) "high priority," meaning that OIRA
was inclined to agree with and look into the suggestion, (2) "medium
priority," meaning that OIRA needed more information about the
suggestion, or (3) "low priority," meaning that OIRA was not convinced
that the suggestion had merit. OIRA listed 23 of the suggestions in the
first category, and said a "prompt letter" might be sent to the
responsible agency for its "deliberation and response.":
In its December 2002 report, OIRA reported on the status of these 23
high priority suggestions. We used that information and supplemented it
with additional information from published sources to determine the
status of each of the regulations or issues that were the subject of
the 23 suggestions as of May 2003. We then asked OIRA to review our
descriptions and provide us with any additional information available.
The consolidated information is presented in the table below for each
of the 23 suggestions.
Table 10: Status of the 23 High Priority Review Suggestions Identified
in OIRA's December 2001 Report on the Costs and Benefits of Federal
Regulations:
Regulation/issue and concern (as reported by OIRA): The Mercatus Center
said that the Department of Energy's analysis for its central air
conditioner and heat pump energy conservation standards did not
adequately consider key differences among consumers and may overstate
projected energy savings; Status: As published in January 2001, a
Department of Energy final rule would have required that the energy
efficiency of new central air conditioners and heat pumps be increased
by 30 percent by January 2006. However, in May 2002, the department
withdrew the rule and issued a new final rule raising minimum energy
efficiency by 20 percent. The department said the withdrawn rule, which
never became effective, was "not economically justified under the
Energy Policy and Conservation Act.".
Regulation/issue and concern (as reported by OIRA): The Mercatus Center
said Department of Health and Human Services (HHS) rule on standards
for privacy of individually identifiable health information imposed a
costly approach to medical privacy protections while failing to offer
tangible benefits; Status: In August 2002, the department published
final revisions to a December 2000 medical privacy rule, clarifying
some aspects and modifying others. For example, instead of mandating
that direct treatment providers obtain prior written consent to use
protected health information before treating a patient, the final rule
required them to make a good faith effort to obtain a patient's written
acknowledgement that the patient received a notice of privacy rights
and practices. The department said the changes were intended to, in
part, relieve "unintended administrative burdens created by the Privacy
Rule.".
Regulation/issue and concern (as reported by OIRA): The Mercatus Center
said that the Food and Drug Administration's (FDA) proposed rule on
trans fatty acids in nutrition labeling misled the public by treating
trans fats as a subset of saturated fat; Status: In September 2001,
the OIRA administrator sent HHS a prompt letter on the trans fatty acid
content of foods, encouraging the agency to give the issue greater
priority. FDA submitted the draft final rule to OIRA for review in May
2003.
Regulation/issue and concern (as reported by OIRA): The Mercatus Center
said the costs of the Department of the Interior's (DOI) Bureau of Land
Management (BLM) rule on hardrock mining outweighed the benefits;
Status: In March 2001, BLM published a proposed rule to suspend the
hardrock mining regulations that took effect in January 2001. In
October 2001, BLM published a final rule removing certain provisions
and returning others to those in effect before January 2001. For
example, the final rule removed a provision granting federal land
managers more authority to deny hardrock mining permits and deleted
enhanced performance standards for groundwater and site remediation.
BLM said the new rule "balances the nation's need to maintain reliable
sources of strategic and industrial minerals, while ensuring protection
of the environment and natural resources on public lands.".
Regulation/issue and concern (as reported by OIRA): The Mercatus Center
said that DOI's National Park Service's rule prohibiting snowmobile use
in Rocky Mountain National Park did not allow for different types of
users to enjoy the park; Status: In its December 2002 report, OIRA
stated that the January 2001 DOI proposed rule on at issue in this
suggestion was undergoing internal departmental review. As of May 2003
no final rule had been issued. However, in response to a lawsuit
involving a separate January 2001 final rule that restricted snowmobile
use in other parks in the Rocky Mountains, the National Park Service
initiated an environmental impact statement that, when completed in
February 2003, suggested allowing the use of snowmobiles with access
restrictions and limitations on the types of engines. In March 2003,
the Park Service approved a record of decision selecting that
alternative. Legislation has been introduced in both the House and the
Senate that would, if enacted, reinstate the ban on snowmobile use in
the parks.
Regulation/issue and concern (as reported by OIRA): The Mercatus Center
said the Department of Labor's (DOL) regulations on "helpers" under the
Davis-Bacon Act should attempt to conform to private sector practices.
Specifically, Mercatus questioned the department's definition of a
"helper," which it said "constrains private sector practices and
innovation."; Status: In November 2000, DOL published a final rule
allowing contractors on federal and federally assisted construction
projects to use "helpers" when that practice prevails in a locality. In
December 2002, OIRA noted in its final report on the costs and benefits
of regulations that DOL decided that changes to the Davis-Bacon
regulations were not appropriate at that time.
Regulation/issue and concern (as reported by OIRA): The Mercatus Center
said the Department of Transportation (DOT) did not present data
supporting its conclusions in its rule on the hours of service of
drivers that driver fatigue contributes to highway fatalities or that
its proposal would address those issues; Status: In May 2000, DOT's
Federal Motor Carrier Safety Administration (FMCSA) published a
proposed rule to alter the hours of service for truck and other motor
carrier drivers. The agency received more than 50,000 comments on the
proposal, which it later characterized as "generally unfavorable." The
fiscal year 2002 appropriations bill prohibited the department from
moving to a final rule that year. In April 2003, FMCSA published a
final rule that changed the scope and certain requirements from the
proposal. For example, the final rule exempted buses from its
coverage.
Regulation/issue and concern (as reported by OIRA): The Mercatus Center
said that revisions to the Environmental Protection Agency's (EPA)
total maximum daily loads program were overly prescriptive and could
cost the states billions of dollars; Status: EPA's July 2000 final
rule on the program was intended to resolve issues concerning the
identification of impaired waterbodies and to address other issues.
However, in an amendment to a fiscal year 2000 appropriations bill,
Congress prohibited EPA from implementing the rule. In October 2001 EPA
published a notice delaying the effective date of the agency's July
2000 rule until April 2003. In March 2003, EPA published a final rule
withdrawing the July 2000 rule. According to OIRA, as of May 2003, a
draft of a new proposed rule was undergoing informal interagency
review.
Regulation/issue and concern (as reported by OIRA): The Mercatus Center
recommended changes to EPA's guidance on states' use of economic
incentive programs to achieve air quality standards; Status: In its
December 2002 report, OIRA said it would "consider further review of
the guidance after the States have further experience with the current
guidelines.".
Regulation/issue and concern (as reported by OIRA): The Mercatus Center
said that EPA's new source review program was a deterrent to investment
in new oil refinery and power generation capacity, and that even
relatively modest modifications that improve environmental performance
could trigger the reviews; Status: In December 2002, EPA published a
final rule revising the Clean Air Act's new source review program that
provides industrial facilities with alternatives to the program's
requirements to install modern pollution controls whenever they make
major modifications that significantly increase emissions. EPA asserts
that the rule will remove obstacles to investments in cleaner and more
efficient processes, and provide greater certainty and administrative
flexibility. Certain environmental groups and state and local
governments petitioned EPA to reconsider specific aspects of the rule,
and EPA has agreed to reconsider and take public comment on several of
the issues raised by these parties. Also in December 2002, EPA
published a proposed rule that would revise an exemption from the rule
for projects involving routine maintenance, repair, and replacement.
Regulation/issue and concern (as reported by OIRA): The Mercatus Center
said that while concentrated animal feeding operations are a problem in
some areas, the benefits of a national rule establishing effluent
guidelines do not justify the costs; Status: In January 2001, EPA
published a proposed rule changing the Clean Water Act permitting
requirements for concentrated animal feeding operations and
strengthening the effluent guidelines for those facilities. In February
2003, EPA published a final rule that OIRA said had been significantly
scaled back from the proposal, but would still more than triple the
number of operations that would have to obtain permits. However,
environmental groups said the new rule weakened the existing standard
and said they were considering a lawsuit.
Regulation/issue and concern (as reported by OIRA): The Mercatus Center
and the Association of Metropolitan Water Agencies said the benefits of
EPA's rule on arsenic in drinking water did not justify the costs;
Status: EPA's January 2001 final rule lowered the allowable level of
arsenic in drinking water from 50 parts per billion to 10 parts per
billion. In May 2001, EPA delayed the rule's implementation to review
the science and cost factors associated with changing the standard. In
September 2001, the National Academy of Sciences published a report
indicating that low levels of arsenic can result in higher incidences
of cancer. In October 2001, EPA announced that it would publish a final
standard at the 10 parts per billion level.
Regulation/issue and concern (as reported by OIRA): The Mercatus Center
said that the Department of Agriculture's Forest Service rule on
roadless area conservation would cause unnecessary economic and
environmental costs; Status: A January 2001 Forest Service final rule
prohibited road construction, reconstruction, and timber harvesting in
inventoried roadless areas on nearly 60 million acres of National
Forest System land. In May 2001, the Idaho District Court granted a
preliminary injunction enjoining the Forest Service from implementing
all aspects of the rule. According to OIRA, in December 2002, the U.S.
Court of Appeals for the Ninth Circuit lifted the injunction and
remanded the decision to the District Court. As of May 2003 its
decision was pending. Also, in July 2003, the Wyoming District Court
granted a permanent injunction enjoining the Forest Service from
implementing this rule.
Regulation/issue and concern (as reported by OIRA): The Mercatus Center
said the Forest Service's planning procedures polarize the public and
are a drain on Forest Service resources; Status: In December 2002, the
Forest Service published a rule proposing changes to its November 2000
rule on forest planning. A review conducted at the direction of the
Office of the Secretary concluded that the 2000 rule was "neither
straightforward nor easy to implement," and "did not clarify the
programmatic nature of land and resource planning." The new proposed
rule would, among other things, allow federal land managers to
disregard previously established scientific requirements for wildlife
protection and expedite the environmental review process when
developing plans. According to OIRA, a final rule is expected in the
fall of 2003.
Regulation/issue and concern (as reported by OIRA): Notre Dame
University said the Department of Education's regulations under title
IV of the Higher Education Act are redundant and place inappropriate
administrative burden on institutions of higher education; Status: In
November 2002, the Department of Education published a final rule
amending the department's regulations under the Higher Education Act
and other statutes. According to the department, the amendments were
designed to "reduce administrative burden for program participants, and
to provide them with greater flexibility to serve students and
borrowers.".
Regulation/issue and concern (as reported by OIRA): The Equal
Employment Advisory Council said that DOL's Office of Federal Contract
Compliance Programs' (OFCCP) equal opportunity survey is excessively
burdensome and ineffective in targeting contractors for compliance
audits; Status: In January 2003, the Employment Standards
Administration within DOL announced a "preclearance consultation
program" in which the public was allowed to provide comment on the
equal opportunity survey. Comments were due by the end of March 2003.
The announcement indicated that OFCCP had engaged an outside contractor
to study the survey submissions, and that the study would be completed
in 2004. In addition, OFCCP requested a 2-year extension to its
authorization for the survey under the Paperwork Reduction Act (until
the end of March 2005).
Regulation/issue and concern (as reported by OIRA): The EEAC said the
Equal Employment Opportunity Commission's (EEOC) Uniform Guidelines on
Employee Selection Procedures should establish a standard definition of
a "job applicant" that does not impose undue burden on employers to
solicit race and gender information; Status: DOL said it and the other
signatories to the Uniform Guidelines (EEOC, the Department of Justice,
and the Office of Personnel Management) have been meeting for more than
3 years on the applicant redefinition issue, particularly as it relates
to recordkeeping and reporting requirements. The department also said
that reauthorization responsibility rests with EEOC in consultation
with the other signatory agencies, and said OMB has requested
resolution of this issue by the end of September 2003.
Regulation/issue and concern (as reported by OIRA): The Employment
Policy Foundation (EPF) said that regulations affecting most
employment-based immigration cause needless effort and delays, and
recommended replacing the certification process with a simpler
attestation procedure; Status: In May 2002, the Employment and
Training Administration within DOL published a proposed rule that
would, among other things, amend its regulations governing the filing
and processing of labor certification applications for the permanent
employment of aliens in the United States. In December 2002, OIRA
indicated that DOL was in the process of addressing comments and
finalizing the rule.
Regulation/issue and concern (as reported by OIRA): LPA, Inc. said DOL
requirements regarding overtime compensation are a disincentive for
providing bonuses; Status: OIRA indicated in its December 2002 report
that DOL was considering whether revisions to these regulations would
be appropriate.
Regulation/issue and concern (as reported by OIRA): EPF and the
National Partnership for Women and Families said record keeping and
notification regulations under the Family Medical Leave Act are
burdensome and ambiguous; Status: In December 2002, OIRA said that DOL
was considering whether revisions to these regulations would be
appropriate. In February 2003, the Employment Standards Administration
within DOL announced that it was conducting a preclearance consultation
program (allowing the public and federal agencies to comment) regarding
information collections under the Family and Medical Leave Act. The
department said it was particularly interested in, among other things,
"whether the proposed collection of information is necessary for the
proper performance of the functions of the agency.".
Regulation/issue and concern (as reported by OIRA): The American
Chemistry Council said that EPA's "mixture and derived from" rule under
the Resource Conservation and Recovery Act is necessarily inclusive,
and recommended exempting certain waste streams resulting from the
treatment of hazardous waste from the requirements; Status: In April
2003, EPA published a proposed rule adding two chemicals--benzene and
2-ethoxyelthanol--to the list of solvents that can be mixed with
wastewater without causing it to be defined as hazardous waste. The
proposed rule also would provide flexibility in the way compliance is
determined, and would make additional listed hazardous wastes eligible
for the de minimus exemption.
Regulation/issue and concern (as reported by OIRA): The City of Austin
said EPA needed to improve its cost-benefit estimates for drinking
water regulations under the Safe Drinking Water Act in three areas
(overly conservative assumptions, inappropriate discount rates, and
inadequate consideration of latency) and should change the way fatal
risk reduction is valued; Status: In its December 2002 report, OIRA
indicated that it was addressing the issues raised in this suggestion
in its new analytic guidance. (See chapter 2 of this report for a
discussion of that guidance.).
Regulation/issue and concern (as reported by OIRA): The American
Petroleum Institute said EPA needed to make several changes to its
requirements regarding the notification of substantial risk under
section 8(e) of the Toxic Substances Control Act (e.g., limit reporting
to information that truly meets the statutory standard of substantial
risk); Status: In its December 2002 report, OIRA said EPA was
considering several options to address this issue and said EPA had
established a new web page that contains guidance, previous
submissions, and new submissions posed within 2 weeks of receipt. OIRA
also said that EPA was working on a package that would make policy
clarifications.
[End of table]
Source: OIRA and GAO analysis of published information.
[End of section]
Appendix V: Comments from the Office of the Information and Regulatory
Affairs:
ADMINISTRATOR:
OFFICE OF INFORMATION AND REGULATORY AFFAIRS:
EXECUTIVE OFFICE OF THE PRESIDENT OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON, D.C. 20503:
SEP 2 2003:
MT. Victor Rezendes Managing Director Strategic Issues Team U.S.
General Accounting Office 441 G Street, NW Washington, DC 20548:
Dear Mr. Rezendes:
Thank you for this opportunity to comment on the General Accounting
Office's (GAO) draft report on the Office of Management and Budget's
(OMB) Office of Information and Regulatory Affairs' (OIRA) regulatory
review process:
("RULEMAKING: OMB's Role and Transparency of Reviews of Agencies' Draft
Rules").
We appreciate GAO's extensive effort to provide a factual analysis of
OIRA's regulatory review process. Overall, OIRA believes that the
factual foundations of the report are well-grounded. In particular, we
are pleased that the draft report takes note of two changes that 1 have
made in the regulatory review process - ensuring that OIRA completes
its review of draft rules in a timely manner and increasing the
transparency of the regulatory review process.
Regarding the timeliness of OIRA's review, Executive Order No. 12866
(E.O. 12866) states that OIRA's review should generally take no longer
than 90 days. However, as GAO notes in its draft report, OIRA during
the latter part of the prior Administration (in the late 1990s and in
2000) routinely had many dozens of draft rules pending beyond the 90-
day period. One of the first steps that I took, upon becoming OIRA
Administrator, was to emphasize to OIRA staff and to the rulemaking
agencies the importance of adhering to the 90-day timetable. As I made
clear, OIRA reviews should rarely, if ever, extend beyond 90 days. As a
result, the number of draft rules pending beyond 90 days quickly
plummeted and, as GAO notes in the draft report, OIRA's review has
extended past 90 days in only a very few instances during my tenure. We
think it is important to note that this dramatic decline in post-90-day
rules is not attributable to OIRA's increasing use of "return letters."
That is because, as GAO's draft report confirms, the decrease in the
number of post-90-day rules far exceeds the number of OIRA return
letters (nor is the increasing timeliness of OIRA review due to an
increase in the number of agency withdrawals of draft rules; again, the
decline in post-90-day-rules far exceeds the number of withdrawals).
Instead, this increase in timeliness is due to our commitment to
identifying issues that require interagency discussion, and resolving
those issues, more expeditiously.
We are also pleased that the draft report identifies the unprecedented
level of transparency that OIRA has implemented during my tenure as
OIRA Administrator. OIRA is committed to ensuring that the public
understands the regulatory review process, and we have increased the
transparency of that process under E.O. 12866. (In this regard, we
believe that the draft GAO report provides an excellent overview of the
regulatory review process, which Members of Congress, their staffs, and
the public should find helpful and informative.):
Specifically, OMB has made much greater use of the Internet to increase
transparency in its regulatory and paperwork review processes. While
certain materials new on the OIRA web page were available previously in
OIRA's docket library, this material was difficult to access and, for
individuals outside the Washington D.C. area, not accessible at all
(other than through the Freedom of Information Act). OIRA's increasing
use of the Internet to disseminate information about the regulatory
review process has provided the public with quick and easy access to a
tremendous amount of material that was previously not available to the
public, or not available in one place, or not readily accessible.
Information currently provided on OMB's website includes:
* lists of the draft regulations under review (this list is updated
daily),
* monthly statistical summaries on reviews completed by OMB,
copies of review-related letters from OMB-OIRA to agencies (including
"prompt" letters, "return" letters, and "post-clearance" letters),
information on meetings with outside parties concerning draft rules
that are under formal or informal OIRA review,
* a list of written correspondence received from outside parties on
rules under OIRA review, and:
* copies of important policy communications such as the OIRA
Administrator's memoranda to the President's Management Council.
In addition, the OIRA Administrator's testimony and speeches are also
available on OMB's website.
As GAO notes in its draft report, one of the increases in transparency
that OIRA has made during my tenure is not simply to make information
that was previously available in OIRA's docket library much more easily
available by posting it on OMB's website. Instead, with respect to
meetings that outside parties request with OIRA concerning draft rules,
OIRA has increased the categories of information that OIRA publicly
disseminates. Previously, OIRA's disclosure procedures applied only to
the meetings with outside parties that occurred during OIRA's formal
review of a draft rule.
Soon after I became OIRA Administrator, I extended the disclosure
requirements to cover meetings with outside parties that occur when a
draft rule is being "informally" reviewed by OIRA. Such meetings had
never before been subject to OIRA's disclosure procedures, but I
concluded that this increase in transparency was warranted, and we are
pleased that GAO's draft report has acknowledged this change.
OMB has also been making great strides in integrating regulatory and
paperwork reviews with OMB's E-government policies, which will further
increase the transparency of the regulatory review process. OIRA is
developing a new computerized tracking
system for OIRA's review of both regulations (under E.O. 12866) and
information collection requests (under the Paperwork Reduction Act).
The new system will replace an outmoded 20-year old tracking system
with electronic capabilities for submission of public comments and
dissemination of OIRA documents. The system will allow the public to
search for and view information about transactions under review and to
review records as they are made public.
OMB continues to explore ways to improve the public's understanding of
OIRA's regulatory review process and appreciates GAO's specific
recommendations. As GAO recommends in the draft report, we plan to
review OIRA's implementation of the transparency requirements. In
particular, in accordance with the draft report's recommendation, we
will work to indicate more clearly in our meeting log which regulatory
action was discussed and the affiliations of the participants in those
meetings.
We do not concur with all the recommendations in the report and are
concerned that some of them are not well-grounded in the reports'
factual foundation. For example, the draft GAO report recommends that
OIRA implement additional disclosure
requirements that would go beyond the unprecedented level of disclosure
that OIRA has already put into place during my tenure. We appreciate
GAO's suggestions in this area, but we do not believe that GAO has
demonstrated the need or desirability of such changes to the existing -
and, again, unprecedented - transparency requirements.
GAO's draft report recommends that OMB disclose changes that the
rulemaking agencies make to their draft rules during OIRA's "informal"
review of a draft rule. Such disclosures are not required by statute
and have not been required by E.O. 12866 or its predecessor, Executive
Order No. 12291 (E.O. 12291). We do not believe that it would improve
the rulemaking process to disclose these deliberations. As the courts
have noted repeatedly over the years, and as Congress recognized in the
Freedom of Information Act's protection for deliberative information
(in FOIA Exemption 5), it is important for the deliberative process
that Executive Branch officials and staff do not operate "in a
fishbowl" but instead can explore options and carry on discussions in a
confidential manner. Moreover, we do not believe it would be
appropriate for OIRA to take it upon itself to waive the deliberative
privilege for the rulemaking agencies regarding the draft rules that
those agencies are developing.
Similarly, the draft report recommends that we should reexamine the
Executive Branch's longstanding practice under E.O. 12866 (and its
predecessor, E.O. 12291) that
its disclosure requirements apply to those documents exchanged between
the rulemaking agency and OIRA's branch chiefs and higher-level
officials. This practice has been followed consistently since the
regulatory review disclosure procedures were first put into place in
the 1980s; in particular, this practice was followed throughout the
prior Administration. The draft GAO report does not explain why this
longstanding practice should now be changed, and we continue to believe
that the longstanding practice is appropriate.
The draft report also recommends that OIRA or the agencies should
disclose the reasons why a rulemaking agency has decided to withdraw
its draft rule from OIRA review. Draft rules that are withdrawn are
done so at the request of the rulemaking agency. The longstanding,
consistent practice under E.O. 12866 (and its predecessor, E.O. 12291)
is that agencies do not disclose the reasons why they have decided at
some particular point in time to submit a draft rule to OIRA for
review, and similarly, agencies have not (at least to our knowledge)
disclosed the reasons why they have decided to withdraw a draft rule
from OIRA review. The draft GAO report does not explain why this
longstanding practice should now be changed, and we continue to believe
that the longstanding practice is appropriate. In any event, we do not
believe it would be appropriate for OIRA to waive the deliberative
privilege for the rulemaking agencies regarding the reasons why they
have decided to withdraw a draft rule.
Another draft recommendation concerns the different categories by which
OIRA records the outcomes of its reviews. The draft report recommends
that OIRA change one of the categories, "consistent with change," so
that it differentiates between draft rules
that were "substantively" changed at OIRA's suggestion or
recommendation and those draft rules that were changed in other ways
and for other reasons. Similarly, the draft report reiterates an issue
that GAO raised several years ago in its 1998 report (GAO/GGD-98-31);
this issue concerns the disclosures that a rulemaking agency makes
under E.O. 12866 relating to the "substantive" changes to the draft
rule that were made during OIRA review. As OIRA Administrator Sally
Katzen explained in her letter of November 10, 1997 (at pages 26-31 of
the GAO report), attempting to define what qualifies as a "substantive"
change is very difficult and not very helpful. As Administrator Katzen
noted: "The same word in the same rule may be viewed by some members of
the public as substantive, while others may view it as not
substantive." That is why, as did Administrator Katzen, we believe it
is better to provide the public with "copies of the various draft
regulations reviewed by OIRA"; this enables the person to "identify the
changes of interest to that person, and evaluate the nature and
importance of the change on its own merits.":
Finally, the draft GAO report provides specific recommendations aimed
at disclosures that are made by the rulemaking agencies. GAO states in
the draft report that it found that rulemaking agencies vary in how
they handle their public rulemaking
dockets, and GAO encourages agencies to follow "best practices"
regarding their documentation. As with the prior set of draft
recommendations, this one also appears to reiterate a GAO
recommendation from its 1998 report. In her comments on a draft
recommendation that OMB issue guidance to agencies on how they should
organize their
rulemaking dockets, Administrator Katzen stated that each rulemaking
agency had developed its own administrative practices and procedures to
fit its own statutes and programs, and she stated that OMB deferred to
these rulemaking agency practices. We continue to defer to the
rulemaking agencies on this point. We should note, though, that we
expect that many of the differences that GAO has identified should be
eliminated by the E-Rulemaking project, one of this Administration's 24
E-Government initiatives. When fully implemented by the rulemaking
agencies, the initiative will consolidate each agency's public docket
into a government-wide docket easily accessible by the public.
Ultimately, the system may save as much as $100 million and make it
easier for businesses and the public to access the rulemaking process.
Thank you again for this opportunity to comment on the draft report. As
1 noted earlier, the report provides an excellent overview of the
regulatory review process and a careful factual review of how OIRA is
operating differently in this Administration.
John D. Graham, Ph.D.
Administrator:
Signed by John D. Graham:
[End of section]
(450138):
FOOTNOTES
[1] U.S. General Accounting Office, Regulatory Reform: Changes Made to
Agencies' Rules Are Not Always Clearly Documented, GAO/GGD-98-31
(Washington, D.C.: Jan. 8, 1998).
[2] Our unit of analysis was technically the submission of a rule to
OIRA for Executive Order 12866 review, rather than the rule itself,
because some of the rules were reviewed by OIRA more than once (e.g.,
submitted, reviewed, and withdrawn, then resubmitted, reviewed again,
and published). However, for simplicity we refer to these executive
order submissions as rules in this report.
[3] OIRA defines outside parties as "persons not employed by the
executive branch."
[4] The Mercatus Center is an education, research, and outreach
organization affiliated with George Mason University. The Center's
Regulatory Studies Program includes a public interest comment project,
which analyzes agencies' regulatory proposals during the public comment
process, before the rules become final. The Regulatory Studies Program
is headed by Dr. Wendy Lee Gramm, Administrator of OIRA from 1985 to
1988.
[5] Most of other agencies that submitted five or more such rules
submitted rules that involved transfer payments (e.g., reimbursement
rates to doctors' medical services in rules submitted by the Centers
for Medicare and Medicaid Services within the Department of Health and
Human Services).
[6] NHTSA revised the final rule to address OIRA's concerns. However,
the U.S. Court of Appeals recently held that the rule was contrary to
the intent of the tire safety legislation and arbitrary and capricious
under the Administrative Procedure Act. Public Citizen, Inc. v. Mineta,
No. 02-4237 (2d Cir. Aug. 6, 2003).
[7] For a discussion of these offices, see U.S. General Accounting
Office, Office of Management and Budget: Changes Resulting From the OMB
2000 Reorganization, GAO/GGD/AIMD-96-50 (Washington, D.C.: Dec. 29,
1995).
[8] We previously reported that about half of all final rules published
during 1997 were published without a notice of proposed rulemaking. See
U.S. General Accounting Office, Federal Rulemaking: Agencies Often
Published Final Actions Without Proposed Rules, GAO/GGD-98-126
(Washington, D.C.: Aug. 31, 1998).
[9] See, for example, Erik D. Olson, "The Quiet Shift of Power: Office
of Management & Budget Supervision of Environmental Protection Agency
Rulemaking Under Executive Order 12291," Virginia Journal of Natural
Resources Law, 4 (Fall 1984), 1-80.
[10] The order defined a "major rule" as any regulation likely to
result in (1) an annual effect on the economy of $100 million or more,
(2) a major increase in costs or prices for consumers or others, or (3)
significant adverse effects on competition, employment, investment,
productivity, innovation, or international competitiveness.
[11] For a discussion of OIRA's review process under this order, see
U.S. General Accounting Office, Regulatory Review: Information on OMB's
Review Process, GAO/GGD-89-101FS (Washington, D.C.: July 14, 1989).
[12] National Academy of Public Administration, Presidential Management
of Rulemaking in Regulatory Agencies (January 1987).
[13] The National Academy of Public Administration and the American Bar
Association have also recognized the potential value of presidential
regulatory review. However, they too recommended reforms such as
improved transparency and better communication between OIRA and agency
staff.
[14] For a discussion of the differences between the transparency
requirements under Executive Order 12291 and Executive Order 12866, see
William D. Araiza, "Judicial and Legislative Checks on Ex Parte OMB
Influence Over Rulemaking," Administrative Law Review, 54 (Spring
2002), 611-630, and Peter M. Shane, "Political Accountability in a
System of Checks and Balances: The Case of Presidential Review of
Rulemaking," Arkansas Law Review, 48 (1995), 161-214.
[15] GAO/GGD-98-31.
[16] As used in this report, a rulemaking "docket" is the official
repository for documents or information related to an agency's
rulemaking activities and may include any public comments received and
other information used by agency decisionmakers.
[17] These nine agencies submitted a total of 102 proposed, final, or
interim final rules to OIRA during this 1-year period. Another EPA rule
that met these criteria was dropped from our review because, although
OIRA had cleared the submitted rule with changes, it has not yet been
publicly announced due to homeland security issues.
[18] U.S. General Accounting Office, Regulatory Reform: Implementation
of the Regulatory Review Executive Order, GAO/T-GGD-96-185 (Washington,
D.C.: Sept. 25, 1996).
[19] Representatives of OIRA told us that the agency occasionally
reviews other material, such as agencies' guidance documents or
notices, reports and budget information shared with OIRA by resource
management officers on the budget side of OMB, and draft legislation.
However, these materials are not covered by the executive order's
review requirements.
[20] OIRA also reviews some rules at the Advance Notice of Proposed
Rulemaking stage.
[21] As discussed in detail later in this report, more than 70 percent
of draft rules submitted to OIRA in recent years have been coded as
either "consistent with change" or "consistent with no change." At
most, only about 3 percent of the rules were coded as "returned."
[22] For example, the memorandum indicated that peer reviewers should
(1) be selected primarily on the basis of necessary technical
expertise, (2) disclose to agencies any prior positions on the issues
at hand, and (3) disclose to agencies their sources of personal and
institutional funding.
[23] OIRA representatives said the Administrator's personal involvement
in a review depends on a variety of factors, such as whether the rule
involves an issue of interest to him or whether it is likely to be
controversial.
[24] The agency officials that we talked with during our review
generally indicated that they attended these meetings but sometimes did
not participate. However, DOT considers these meetings "ex parte
communications," and generally does not attend. (In fact, DOT has a
written policy of not attending these meetings.)
[25] Office of Management and Budget, "Making Sense of Regulation: 2001
Report to Congress on the Cost and Benefits of Regulations and Unfunded
Mandates on State, Local and Tribal Entities," (December 2001).
[26] Rebecca Adams, "Regulating the Rule-Makers: John Graham at OIRA,"
CQ Weekly, 60 (Feb. 23, 2002), 520-526.
[27] Testimony before the Senate Committee on Governmental Affairs,
September 25, 1996.
[28] William Niskanen, "Clinton's Regulatory Record: Policies, Process,
and Outcomes," Regulation (1996), 27-28.
[29] Office of Management and Budget, "Stimulating Smarter Regulation:
2002 Report to Congress on the Costs and Benefits of Federal
Regulations and Unfunded Mandates on State, Local, and Tribal
Entities," (December 2002).
[30] Others have also noted the salience of presidential priorities in
OIRA's operations. See, for example, Susan E. Dudley and Angela
Antonelli, "Congress and the Clinton OMB: Unwilling Partners in
Regulatory Oversight?," Regulation (Fall 1997), 17-23. The authors
noted "OIRA is supposed to simultaneously provide independent and
objective analysis, and report to the president on the progress of
executive policies and programs. When those functions conflict, the
presidential agenda will most certainly prevail over independent and
objective analysis."
[31] The executive order actually says review periods can be extended
only if the agency requests an extension and the OMB Director provides
written permission. However, an OIRA representative said that
extensions have been provided if either condition is met.
[32] OIRA listed two items on the "prompt letters" page of its Web site
that did not appear to be prompt letters--a June 2002 EPA press release
regarding an EPA-OIRA collaboration and a January 2003 memorandum to
the heads of selected independent agencies asking them to consider
recommendations for reform that OIRA had received from the public.
[33] See Elena Kagan, "Presidential Administration," Harvard Law
Review, 114 (2001): 2,245-2,385, who asserted that recent presidents
have increasingly made agencies' regulatory activity into an extension
of their own policy and political agendas. She said President Clinton
did so primarily by "exercising directive authority over these
agencies," using formal directives to the heads of executive agencies
to "set the terms of administrative action and prevent deviation from
his proposed course."
[34] The October 2001 transparency memorandum indicates that covered
telephone calls and correspondence must be logged and/or sent to the
rulemaking agency within 10 working days. An OIRA representative told
us that meetings are typically logged within 3 or 4 days. He also said
that materials provided to OIRA at meetings are only available in hard
copy in the OIRA docket, not electronically.
[35] An OIRA representative told us that the office had not made this
information available electronically during previous administrations
because of resource constraints.
[36] However, in practice we found evidence that such communications
are, at least in some cases, disclosed. OIRA's docket for several of
the rules that we examined in chapter 3 of this report contained e-
mails and faxes between the OIRA desk officer and agency staff about
rules under review.
[37] Agency officials told us that if a rule is withdrawn after having
been formally proposed, an agency may publish a "withdrawal" notice in
the Federal Register. If the rule is withdrawn before being proposed,
they said the only documentation may be a notation in the "completed
action" section of the Unified Agenda of Federal Regulatory and
Deregulatory Actions. However, OIRA's involvement may not be revealed
in either form of documentation.
[38] The other meetings were with representatives of state, local, or
tribal governments (11 meetings), Members of Congress (2 meetings), or
individuals/organizations that could not be readily identified (8
meetings).
[39] OIRA's FTE total includes a number of positions that are not
regularly involved in the review of rules under Executive Order 12866,
including staff within the Information Policy and Technology branch and
the Statistical and Science Policy branch, and administrative staff
within the office. As of July 2003, 22 full-time OIRA analysts were
primarily responsible for the regulatory and paperwork reviews of all
federal agencies.
[40] Stephen Breyer, Breaking the Vicious Circle: Toward Effective Risk
Regulation (Cambridge, Mass.: Harvard University Press, 1993).
[41] In August 2002, the President signed Executive Order 13272, which
also urged agencies to give proper consideration to small entities in
their rulemaking.
[42] U.S. General Accounting Office, Regulatory Flexibility Act: Status
of Agencies' Compliance, GAO/GGD-94-105 (Washington, D.C.: Apr. 27,
1994).
[43] The 1996 best practices document was modified and issued as
guidance in 2000.
[44] "Valuing Health: An OMB Perspective," speech given before the
Conference on Valuing Health Outcomes: An Assessment of Approaches
(Feb. 13, 2003).
[45] The Administrator noted that EPA's most recent VSLY estimates were
$434,000 per life-year saved for persons over age 65 and $172,000 per
life year saved for those under age 65.
[46] U.S. General Accounting Office, Chemical Risk Assessment: Selected
Federal Agencies' Procedures, Assumptions, and Policies, GAO-01-810
(Washington, D.C.: Aug. 6, 2001).
[47] For a copy of these guidelines, see 67 Fed. Reg. 8452 (Feb. 22,
2002).
[48] Shortly before the publication of this report, on August 29, 2003,
OIRA proposed a standard analytical process by which all "significant
regulatory information" that federal agencies intend to disseminate
would be peer reviewed.
[49] Our unit of analysis was technically the submission of a rule to
OIRA for Executive Order 12866 review, rather than the rule itself,
because some of the rules were reviewed by OIRA more than once.
However, for simplicity we refer to these executive order submissions
as rules in this report.
[50] See appendix I for a more detailed description of our objectives,
scope, and methodology, and appendix II for information about each of
the 85 submissions.
[51] See, for example, Arthur Allen, "Where the Snowmobiles Roam,"
Washington Post Magazine (Aug. 18, 2002).
[52] OIRA's database has a separate field, separate from the field on
reviews' outcomes, that identifies submissions with legal deadlines.
Twenty-two of the 85 rules that we reviewed were coded in OIRA's
database as having a statutory or judicial deadline.
[53] The agencies sometimes attributed suggested changes to OMB and
sometimes specifically to OIRA. In a few instances, OMB staff outside
of OIRA suggested the changes.
[54] Because the executive order does not require agencies to document
nonsubstantive changes, three of the rules we included in this category
were ones in which it was clear all the changes were minor, but the
source of the changes (i.e., whether they were made at the suggestion
of OMB/OIRA) could not be identified.
[55] For example, after submitting its rule on emission standards for
surface coating of metal furniture to OIRA, EPA reanalyzed data from
the covered industry and revised the emission limits to be less
stringent than those originally proposed--what we would have considered
a "significant" change if suggested by OIRA (ID 47). However, because
the most significant OIRA-suggested change was the addition of text to
the preamble clarifying the agency's analysis and requesting comments
on a particular provision, we coded this rule as having had "other
material changes."
[56] The marine and motorcycle engines provisions later resurfaced as a
separate rule (ID 54).
[57] FAA resubmitted the rule, with no revisions, on the same day that
it was returned. Ten days later, OIRA completed its review of the
resubmitted version "consistent with no change."
[58] This was the same rule that was subsequently resubmitted, returned
to FAA by OIRA, resubmitted yet again, and ultimately completed OIRA
review with no changes.
[59] We performed a statistical analysis using Fisher's exact test to
determine if there was a statistically significant association between
whether the rules reviewed by OIRA were economically significant and
whether the rules were significantly affected by OIRA. The test results
(p = 0.43) did not support a hypothesis that a statistically
significant association exists.
[60] Official vaccinates are livestock vaccinated as part of a foot-
and-mouth eradication program.
[61] In some OIRA files, we found evidence that OIRA had reviewed
copies of substantive comments on previous versions of the draft rule
currently under review. Because these were public docket materials
previously submitted to the regulatory agencies, not OIRA, we did not
consider them as evidence of direct contact with OIRA by external
parties. Also, there was evidence that external parties contacted OIRA
after the formal review period regarding two other substantively
changed submissions, but such postreview contacts could not have
affected the outcome of OIRA's reviews in those cases.
[62] The two FAA submissions were actually the same Part 145 repair
station regulation. One of the submissions resulted in a withdrawal and
one resulted in a return (IDs 84 and 72, respectively).
[63] Direct tire pressure monitoring systems have a tire pressure
sensor in each tire that transmits pressure information to a receiver.
Indirect systems do not have tire pressure sensors. Current indirect
systems rely on the wheel speed sensors in an anti-lock braking system
to detect and compare differences in the rotational speed of a
vehicle's wheels, which can correlate to differences in tire pressure.
[64] The Center for Energy and Economic Development is a nonprofit
organization formed by coal-producing companies, railroads, a number of
electric utilities, and related organizations.
[65] We conducted a similar exercise in our previous GAO report on this
subject. See GAO/GGD-98-31.
[66] In many cases, the agencies prepared supplementary memoranda or
summaries for us that provided additional information and explanations
regarding the changes made in various rules. In those cases, we used
the supplementary information to address other elements of our review-
-such as the nature of changes attributed to OIRA--but did not consider
the materials specifically prepared for our review to be public
documents within the dockets.
[67] It is notable that these dockets sometimes contained information
that the agencies were not required to disclose under OIRA's
interpretation of the executive order--and that information frequently
provided valuable insights to our determinations regarding the nature
of OIRA's changes. For example, the agencies sometimes disclosed
changes that were not "substantive," and sometimes disclosed changes
that OIRA made to rules before they were formally submitted to OIRA.
[68] As table 5 shows, the executive order's documentation requirements
were not applicable in three of the five FAA changed rules we reviewed
because only minor (nonsubstantive) changes had been made to those
rules.
[69] The other Office of Water docket included an annotated "redline/
strikeout" version of the revised rule. The Corps of Engineers prepared
the docket for one rule jointly issued by the Corps and EPA's Office of
Water and similarly included an annotated "redline/strikeout" version
of the revised rule.
[70] For a discussion of this memorandum and the rules delayed, see
U.S. General Accounting Office, Regulatory Review: Delay of Effective
Dates of Final Rules Subject to the Administration's January 20, 2001,
Memorandum, GAO/02-370R (Washington, D.C.: Feb. 15, 2002).
[71] She said that the Mercatus Center actually submitted a total of 58
suggestions for reform. However, several of the suggestions were about
the same rule, so OIRA's report only listed the 44 comments that were
about different rules.
[72] For an examination of the first module of this initiative, see
U.S. General Accounting Office, Electronic Rulemaking: Efforts to
Facilitate Public Participation Can Be Improved, GAO-03-901
(Washington, D.C.: Sept. 17, 2003).
[73] OIRA defines outside parties as "persons not employed by the
executive branch."
[74] See, for example, Arthur Allen, "Where the Snowmobiles Roam,"
Washington Post Magazine (Aug. 18, 2002).
[75] OIRA's database has a separate field, separate from the field on
reviews' outcomes, that identifies submissions with legal deadlines.
Twenty-two of the 85 rules that we reviewed were coded in OIRA's
database as having a statutory or judicial deadline.
[76] The agencies sometimes attributed changes to OMB and sometimes
specifically to OIRA. In a few instances, OMB staff outside of OIRA
suggested the changes. There were also rules in which the regulatory
agencies initiated more significant changes during the period of OIRA's
review than did OIRA.
[77] We conducted a similar exercise in our previous GAO report on this
subject. See GAO/GGD-98-31.
[78] In many cases, the agencies prepared supplementary memos or
summaries for us that provided additional information and explanations
regarding the changes made in various rules. In those cases, we used
the supplementary information to address other elements of our review-
-such as the nature of changes attributed to OIRA--but did not consider
the materials specifically prepared for our review to be public
documents within the dockets.
[79] It is notable that these dockets sometimes contained information
that the agencies were not technically required to disclose--and that
information frequently provided valuable insights to our determinations
regarding the gravity of OIRA's changes. For example, the agencies
sometimes disclosed changes that were not "substantive," and sometimes
disclosed changes that OIRA made to rules before they were formally
submitted to OIRA.
[80] The RIN is assigned by the Regulatory Information Service Center
to identify each rulemaking cycle listed in The Regulatory Plan and the
Unified Agenda of federal agencies, as directed by Executive Order
12866. Also, OMB has asked agencies to include RINs in the headings of
their Rule and Proposed Rule documents when publishing them in the
Federal Register to make it easier for the public and agency officials
to track the publication history of regulatory actions throughout their
development.
[81] In addition to the date of publication, we provide the location of
the published rule using the Federal Register's standard format (e.g.,
66 FR 55530 indicates that the rule was published starting on page
55530 of volume 66).
[82] We also checked OIRA's phone logs regarding calls related to
Executive Order 12866 reviews, but found no evidence of such calls
before or during OIRA's formal review periods of the rules within our
scope.
[83] This letter was not in the EPA docket for the rule, but did appear
in the OIRA docket.
[84] TSS are characterized by EPA as conventional pollutants. The
primary TSS of concern in this rulemaking is sediment.
[85] The U.S. Court of Appeals recently held that the rule was contrary
to the intent of the tire safety legislation and arbitrary and
capricious under the APA. Public Citizen, Inc. v. Mineta, No. 02-4237
(2d Cir. Aug. 6, 2003).
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