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Calendar No. 643
116th Congress } { Report
SENATE
2d Session } { 116-333
_______________________________________________________________________
UNFUNDED MANDATES ACCOUNTABILITY AND TRANSPARENCY ACT
__________
R E P O R T
of the
COMMITTEE ON HOMELAND SECURITY AND
GOVERNMENTAL AFFAIRS
UNITED STATES SENATE
to accompany
S. 4077
TO AMEND THE UNFUNDED MANDATES REFORM ACT OF 1995
TO PROVIDE FOR REGULATORY IMPACT ANALYSES FOR CERTAIN RULES, AND FOR
OTHER PURPOSES
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
December 16, 2020.--Ordered to be printed
__________
U.S. GOVERNMENT PUBLISHING OFFICE
19-010 WASHINGTON : 2020
COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
RON JOHNSON, Wisconsin, Chairman
ROB PORTMAN, Ohio GARY C. PETERS, Michigan
RAND PAUL, Kentucky THOMAS R. CARPER, Delaware
JAMES LANKFORD, Oklahoma MAGGIE HASSAN, New Hampshire
MITT ROMNEY, Utah KAMALA D. HARRIS, California
RICK SCOTT, Florida KYRSTEN SINEMA, Arizona
MICHAEL B. ENZI, Wyoming JACKY ROSEN, Nevada
JOSH HAWLEY, Missouri
Gabrielle D'Adamo Singer, Staff Director
Joseph C. Folio III, Chief Counsel
Joshua P. McLeod, Senior Professional Staff Member
David M. Weinberg, Minority Staff Director
Zachary I. Schram, Minority Chief Counsel
Yogin J. Kothari, Minority Professional Staff Member
Laura W. Kilbride, Chief Clerk
Calendar No. 643
116th Congress } { Report
SENATE
2d Session } { 116-333
======================================================================
UNFUNDED MANDATES ACCOUNTABILITY AND TRANSPARENCY ACT
_______
December 16, 2020.--Ordered to be printed
_______
Mr. Johnson, from the Committee on Homeland Security and Governmental
Affairs, submitted the following
R E P O R T
[To accompany S. 4077]
The Committee on Homeland Security and Governmental
Affairs, to which was referred the bill (S. 4077) to amend the
Unfunded Mandates Reform Act of 1995 to provide for regulatory
impact analysis for certain rules, and for other purposes,
having considered the same, reports favorably thereon with an
amendment and recommends that the bill, as amended, do pass.
CONTENTS
Page
I. Purpose and Summary..............................................1
II. Background and Need for the Legislation..........................2
III. Legislative History..............................................4
IV. Section-by-Section Analysis......................................4
V. Evaluation of Regulatory Impact..................................6
VI. Congressional Budget Office Cost Estimate........................6
VII. Changes in Existing Law Made by the Bill, as Reported............6
I. Purpose and Summary
S. 4077, the Unfunded Mandates Accountability and
Transparency Act, updates and expands the Unfunded Mandates
Reform Act (UMRA) by requiring Federal agencies to assess the
impact of new major rules on jobs, consider market-based,
nongovernmental regulatory alternatives, and maximize benefits
instead of selecting the least costly, most cost effective
regulatory alternative as required by UMRA. The bill also
extends UMRA to independent agencies; expands the rules that
trigger UMRA's requirements to those that have an annual effect
on the economy of $100 million or more; permits cost
consideration and meaningful judicial review; increases
stakeholder consultation; and expands the budget point of order
for intergovernmental mandates to private sector mandates.
II. Background and the Need for Legislation
Prior to the 1970s, the Federal Government traditionally
relied on voluntary grant-in-aid funding to encourage state and
local government participation in Federal activities or
services.\1\ However, in the 1970s and 1980s, there was an
apparent shift in how the Federal Government interacted with
states and localities,\2\ increasingly relying on ``new, more
intrusive, and more compulsory'' programs and regulations to
require compliance under the threat of legal penalties.\3\
State and local government advocates viewed these intrusive
methods as ``unfunded mandates'' on states, and that such
mandates were an infringement on American federalism.\4\
---------------------------------------------------------------------------
\1\Robert Dilger, Cong. Research Serv., R40957, Unfunded Mandates
Reform Act: History, Impact, and Issues 1 (2020), https://fas.org/sgp/
crs/misc/R40957.pdf.
\2\Id. at 1-2.
\3\Id. at 2.
\4\Id.
---------------------------------------------------------------------------
The state and local government advocates argued that a
Federal statute was needed to prevent legislation and
regulations that imposed higher costs and inefficiencies on
state and local governments.\5\ These efforts resulted in
President Clinton signing UMRA into law.\6\
---------------------------------------------------------------------------
\5\Id.
\6\Unfunded Mandates Reform Act of 1995, Pub. L. No. 104-4, Sec. 1,
109 Stat. 48 (1995), https://www.congress.gov/104/plaws/publ4/PLAW-
104publ4.pdf.
---------------------------------------------------------------------------
UMRA requires the Congressional Budget Office (CBO) to
assess the cost of mandates that would apply to state, local,
and tribal governments, or to the private sector.\7\ The
purpose of UMRA is to ensure that Congress receives information
about the potential effects of mandates of legislation under
congressional consideration.\8\ UMRA refers to obligations from
legislation or regulations as mandates to intergovernmental or
private sector entities.\9\
---------------------------------------------------------------------------
\7\CBO's Activities Under the Unfunded Mandates Reform Act, Cong.
Budget Off., https://www.cbo.gov/publication/51335 (last visited July
31, 2020).
\8\Id.
\9\Dilger, supra note 1, at 1.
---------------------------------------------------------------------------
As part of its review, CBO is required to ``determine
whether the aggregate direct costs of the mandates would be
greater than the statutory thresholds established in UMRA in
any of the first five fiscal years in which the mandates are
effective.''\10\ In 1996, the statutory thresholds established
by UMRA were $50 million for intergovernmental mandates and
$100 million for private-sector mandates.\11\ The statutory
thresholds are annually adjusted for inflation, and by 2019,
the thresholds had increased to $82 million for
intergovernmental mandates and $164 million for private-sector
mandates.\12\
---------------------------------------------------------------------------
\10\Cong. Budget Off., supra note 7.
\11\Id.
\12\Id.
---------------------------------------------------------------------------
Under UMRA, when a mandate results in a restriction on the
ability of a private sector entity to generate revenue, ``CBO
measures the cost of that mandate as the direct loss of
income.''\13\ CBO has interpreted that UMRA's definition of
mandate includes prohibitions that result in lost income.\14\
Accordingly, CBO measures the net income foregone in cases
where legislation would ban the production or sale of a
good.\15\
---------------------------------------------------------------------------
\13\Id.
\14\Id.
\15\Id.
---------------------------------------------------------------------------
UMRA prohibits the consideration of a reported bill unless
CBO has provided the committee with a published statement about
the costs of intergovernmental and private-sector mandates.\16\
UMRA also prohibits consideration of reported legislation if
the unfunded intergovernmental mandates in the proposed
legislation are estimated by CBO to have direct costs above the
statutory threshold unless the bill provides direct spending
authority or authorizes sufficient appropriations to cover
those costs.\17\
---------------------------------------------------------------------------
\16\Id.
\17\Id.
---------------------------------------------------------------------------
UMRA also requires Federal agencies to consider regulatory
alternatives and select the ``least costly, most cost-effective
or least burdensome alternative.''\18\ Under UMRA, Federal
agencies are required to prepare written statements that
identify costs and benefits of a Federal mandate that would
result in an annual expenditure of $100 million or more to
state, local and tribal governments, or the private sector,
prior to promulgating a notice of proposed rulemaking.\19\ As
the Congressional Research Service (CRS) has noted, most of
these requirements were included in President Clinton's
Executive Order 12866.\20\ UMRA does not apply to participation
in voluntary Federal programs and rules issued by most
independent regulatory agencies.\21\
---------------------------------------------------------------------------
\18\Cong. Budget Off., supra note 7.
\19\Id.
\20\Id.
\21\Dilger, supra note 1, at 4.
---------------------------------------------------------------------------
According to CRS, CBO has submitted 14,035 estimates of
private-sector mandate costs imposed from a specific bill,
amendment or conference report between January 1, 1996 and June
30, 2020.\22\ Of those 14,035 cost estimates, about 15.3
percent had costs imposed on the private sector and 3.2 percent
had costs that exceeded UMRA's threshold.\23\ Additionally, CRS
has found that most of the mandates identified in regulations
are directed at the private sector.\24\ Of the 297 major rules
that ``met UMRA's definition of a mandate on the public or
private sector'' between 1995 and 2019, 277 were private-sector
mandates only.\25\
---------------------------------------------------------------------------
\22\Id. at 15.
\23\Id. at 16.
\24\Id. at 28.
\25\Id.
---------------------------------------------------------------------------
In the years since UMRA was enacted, there have been a
number of efforts to update the law. One effort to update the
law was the Unfunded Mandates Information and Transparency Act
of 2019 (UMITA). UMITA would broaden UMRA to include both
direct and indirect costs and apply UMRA to independent
agencies.\26\ According to CRS, similar legislation to UMITA
was passed by the House during the 112th, 113th, 114th, and
115th Congresses.\27\
---------------------------------------------------------------------------
\26\Id. at 34-35.
\27\Id. at 34 n.133.
---------------------------------------------------------------------------
UMATA updates and expands UMRA by requiring agencies to
assess regulations' effect on jobs, and to consider market-
based, flexible, and non-governmental alternatives to agency
rules. UMATA would require agencies to receive public input
earlier in the rulemaking process as the agency develops
alternatives. The bill would extend analytical requirements of
UMRA to independent agencies and allow judicial review of
compliance with UMRA. Finally, UMATA extends UMRA's budget
point of order for intergovernmental unfunded mandates to
unfunded mandates on the private sector.
III. Legislative History
Senator Rob Portman (R-OH) introduced S. 4077, the Unfunded
Mandates Accountability and Transparency Act, on June 25, 2020,
with Senators Deb Fischer (R-NE) and James Lankford (R-OK).
Senator Rick Scott (R-FL) later joined as a cosponsor.
The bill was referred to the Committee. The Committee
considered S. 4077 at a July 22, 2020 business meeting.
The Committee ordered S. 4077 reported favorably on July
22, 2020, by a roll call vote of 8 yeas to 5 nays. Senators
voting in the affirmative were Johnson, Portman, Paul,
Lankford, Romney, Scott, Enzi, and Hawley. Senators voting in
the negative were Peters, Carper, Hassan, Harris, Rosen. For
the record only, Senator Sinema voted nay by proxy. Consistent
with Committee rules, the Committee reports the bill with a
technical amendment by agreement of the Chairman and Ranking
Member.
IV. Section-by-Section Analysis of the Bill, as Reported
Section 1. Short title
This section sets forth that the bill may be referred to as
the ``Unfunded Mandates Accountability and Transparency Act''.
Section 2. Findings
This section describes congressional findings that
regulations provide the public with benefits at particular
costs to all levels of government and that the public has the
right to be aware of both costs and benefits.
Section 3. Regulatory impact analyses for certain rules
This section amends UMRA by capitalizing Tribal throughout
the Act and defining a major rule as any rule which creates an
annual economic impact of $100 million or more; results in a
significant cost increase for consumers, private businesses or
any level of government; or adversely affects the trade
competitiveness of U.S. businesses against foreign businesses.
Two subsections are added to section 202 to define cost and to
require a preliminary and final regulatory impact analysis to
be published in the Federal Register for any proposed major
rule. The preliminary analysis must be subject to public
comment and should be attached to the published Federal
Register notice; the final analysis must attach to the final
published version of the rule. Each analysis must include the
costs and benefits of the proposed rule along with costs and
benefits of potential alternatives, including options that
provide the public with information to make choices, require no
action by the federal government, or allow for regulatory
flexibility. Analysis must also incorporate state, local, and
Tribal government costs including an evaluation of how much
cannot be offset via Federal assistance; available Federal
resources; an explanation of section 205 compliance; rule
impacts on the budgets of particular levels of government,
types of private businesses, or geographic regions and on
employment; the extent of discussion with government officials
at all levels; and an agency evaluation of public comments.
Summaries of this analysis must be included in the final
proposed rule or any other statement.
Section 4. Enhanced stakeholder consultation
This section amends section 204 of UMRA to incorporate
private entities within the section's provisions. Agencies
should consult with private entities and all levels of
government before and throughout the rulemaking process,
including discussions of cost-benefit analyses, potential
risks, overall impact, and possible alternatives. Electronic
feedback may be utilized but may not be the exclusive method of
seeking input.
Section 5. Maximize net benefits or provide explanation
This section replaces the former section 205 of UMRA with a
new section 205, which defines ``cost'' for the purposes of
this bill and requires a consideration of potential rules and
alternatives followed by the pursuit of the option that
provides the most benefit under a cost-benefit analysis within
the statutory rulemaking scope. Exceptions to this requirement
may be allowed upon permission granted by the Administrator of
the Office of Information and Regulatory Affairs (OIRA) and
agency showing and explanation of other factors outside the
statutory cost-benefit scope or of the potential for lowered
costs or increased benefits.
Section 6. New authorities and responsibilities for Office of
Information and Regulatory Affairs
This section amends UMRA, section 208, to make the
Administrator of OIRA responsible for oversight of agency major
rules requiring an impact analysis in order to avoid conflict
with rules of other federal agencies and to ensure compliance
with other provisions of this bill and other law. Any areas of
concern based on agency, bill, or law conflict should be
identified, reported to the rulemaking agency, and monitored
for future compliance. The Administrator will submit an annual
report to Congress describing agency compliance with the terms
of this bill and compliance efforts by the administrator.
Section 7. Initiation of rulemaking
This section renames the former section 209 to section 210,
and adds a new section 209, which details the procedure for
agency introduction of a major rule. Agencies proposing major
rules must provide an electronic docket for the rule to be
potentially accompanied by a physical component and, at least
90 days before the rule's publication, must publish an initial
Federal Register notice describing the problem addressed by the
rule, the rule and its implications, the agency's authority to
institute the rule, and the method by which public commenters
may submit thoughts on or suggested alternatives to the rule.
Section 8. Inclusion of application to independent regulatory agencies
This section provides an exemption for monetary rules
proposed by the Federal Open Market Committee or the Federal
Reserve System Board of Governors and amends 2 U.S.C.
Sec. 658(1) to include independent agencies within the scope of
the Congressional Budget Act of 1974 with an exception for
rules that concern monetary policy.
Section 9. Judicial review
This section delineates the availability and scope of
judicial review available to individuals affected by enacted
agency rules under UMRA, as well as court jurisdiction and form
of relief.
Section 10. Applying substantive point of order to private sector
mandates
This section expands section 658d(a)(2) the Congressional
Budget Act of 1974 to include all federal mandates, not just
intergovernmental mandates.
Section 11. Effective date
This section establishes that amendments to existing law
made by sections 3-5 and 7 take effect 120 days after this bill
is enacted.
V. Evaluation of Regulatory Impact
Pursuant to the requirements of paragraph 11(b) of rule
XXVI of the Standing Rules of the Senate, the Committee has
considered the regulatory impact of this bill and determined
that the bill will have no regulatory impact within the meaning
of the rules. The Committee agrees with the Congressional
Budget Office's statement that the bill contains no
intergovernmental or private-sector mandates as defined in UMRA
and would impose no costs on state, local, or tribal
governments.
VI. Congressional Budget Office Cost Estimate
CBO failed to provide the Committee with a cost estimate in
time for the final reporting deadline of the 116th Congress.
VII. Changes in Existing Law Made by the Bill, as Reported
In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, changes in existing law made by
the bill, as reported, are shown as follows: (existing law
proposed to be omitted is enclosed in brackets, new matter is
printed in italic, and existing law in which no change is
proposed is shown in roman:
UNFUNDED MANDATES REFORM ACT OF 1995
* * * * * * *
SEC. 2. PURPOSES.
The purposes of this chapter are--
(1) to strengthen the partnership between the Federal
Government and State, local, and [tribal] Tribal
governments;
(2) to end the imposition, in the absence of full
consideration by Congress, of Federal mandates on
State, local, and [tribal] Tribal governments without
adequate Federal funding, in a manner that may displace
other essential State, local, and [tribal] Tribal
governmental priorities;
(3) to assist Congress in its consideration of
proposed legislation establishing or revising Federal
programs containing Federal mandates affecting State,
local, and [tribal] Tribal governments, and the private
sector by--
(A) providing for the development of
information about the nature and size of
mandates in proposed legislation; and
(B) establishing a mechanism to bring such
information to the attention of the Senate and
the House of Representatives before the Senate
and the House of Representatives vote on
proposed legislation;
(4) * * *
(5) to require that Congress consider whether to
provide funding to assist State, local, and [tribal]
Tribal governments in complying with Federal mandates,
to require analyses of the impact of private sector
mandates, and through the dissemination of that
information provide informed and deliberate decisions
by Congress and Federal agencies and retain competitive
balance between the public and private sectors;
(6) * * *
(7) to assist Federal agencies in their consideration
of proposed regulations affecting State, local, and
[tribal] Tribal governments, by--
(A) requiring that Federal agencies develop a
process to enable the elected and other
officials of State, local, and [tribal] Tribal
governments to provide input when Federal
agencies are developing regulations; and
(B) requiring that Federal agencies prepare
and consider estimates of the budgetary impact
of regulations containing Federal mandates upon
State, local, and [tribal] Tribal governments
and the private sector before adopting such
regulations, and ensuring that small
governments are given special consideration in
that process; and
(8) to begin consideration of the effect of
previously imposed Federal mandates, including the
impact on State, local, and [tribal] Tribal governments
of Federal court interpretations of Federal statutes
and regulations that impose Federal intergovernmental
mandates.
SEC. 3. DEFINITIONS.
For purposes of this chapter--
(1) except as provided in section 1555 of this title,
the terms defined under section 658 of this title shall
have the meanings as so defined; [and]
(2) the term ``Director'' means the Director of the
Congressional Budget Office[.] and
(3) the term ``major rule'' means a rule, as defined
in section 551 of title 5, United States Code, that the
Administrator of the Office of Information and
Regulatory Affairs determines is likely to cause--
(A) an annual effect on the economy of
$100,000,000 or more, adjusted once every 5
years to reflect increases in the Consumer
Price Index for All Urban Consumers, as
published by the Bureau of Labor Statistics of
the Department of Labor;
(B) a major increase in costs or prices for
consumers, individual industries, Federal,
State, local, or Tribal government agencies, or
geographic regions; or
(C) significant adverse effects on
competition, employment, investment,
productivity, innovation, public health and
safety, or the ability of United States-based
enterprises to compete with foreign-based
enterprises in domestic and export markets.
* * * * * * *
SEC. 6. EXEMPTION FOR MONETARY POLICY.
Nothing in title II, III, or IV shall apply to rules that
concern monetary policy proposed or implemented by the Board of
Governors of the Federal Reserve System or the Federal Open
Market Committee.
* * * * * * *
TITLE II--REGULATORY ACCOUNTABILITY AND REFORM
SEC. 201. * * *
SEC. 202. [STATEMENTS TO ACCOMPANY SIGNIFICANT REGULATORY ACTIONS]
REGULATORY IMPACT ANALYSES FOR CERTAIN RULES.
[(a) In General.--Unless otherwise prohibited by law,
before promulgating any general notice of proposed rulemaking
that is likely to result in promulgation of any rule that
includes any Federal mandate that may result in the expenditure
by State, local, and tribal governments, in the aggregate, or
by the private sector, of $100,000,000 or more (adjusted
annually for inflation) in any 1 year, and before promulgating
any final rule for which a general notice of proposed
rulemaking was published, the agency shall prepare a written
statement containing--
(1) an identification of the provision of Federal law
under which the rule is being promulgated;
(2) a qualitative and quantitative assessment of the
anticipated costs and benefits of the Federal mandate,
including the costs and benefits to State, local, and
tribal governments or the private sector, as well as
the effect of the Federal mandate on health, safety,
and the natural environment and such an assessment
shall include--
(A) an analysis of the extent to which such
costs to State, local, and tribal governments
may be paid with Federal financial assistance
(or otherwise paid for by the Federal
Government); and
(B) the extent to which there are available
Federal resources to carry out the
intergovernmental mandate;
(3) estimates by the agency, if and to the extent
that the agency determines that accurate estimates are
reasonably feasible, of--
(A) the future compliance costs of the
Federal mandate; and
(B) any disproportionate budgetary effects of
the Federal mandate upon any particular regions
of the nation or particular State, local, or
tribal governments, urban or rural or other
types of communities, or particular segments of
the private sector;
(4) estimates by the agency of the effect on the
national economy, such as the effect on productivity,
economic growth, full employment, creation of
productive jobs, and international competitiveness of
United States goods and services, if and to the extent
that the agency in its sole discretion determines that
accurate estimates are reasonably feasible and that
such effect is relevant and material; and
(5)
(A) a description of the extent of the
agency's prior consultation with elected
representatives (under section 1534 of this
title) of the affected State, local, and tribal
governments;
(B) a summary of the comments and concerns
that were presented by State, local, or tribal
governments either orally or in writing to the
agency; and
(C) a summary of the agency's evaluation of
those comments and concerns.]
(a) Definition of Cost.--In this section, the term ``cost''
means the cost of compliance and any reasonably foreseeable
indirect costs, including revenues lost, as a result of a major
rule of an agency that is subject to this section.
(b) Regulatory Impact Analyses.--
(1) Requirement.--Before promulgating any proposed or
final major rule, the agency promulgating the major
rule shall prepare and publish in the Federal Register
an initial and final regulatory impact analysis with
respect to the major rule.
(2) Initial Regulatory Impact Analysis.--An initial
regulatory impact analysis required under paragraph (1)
shall--
(A) accompany the notice of proposed
rulemaking with respect to the major rule that
is the subject of the analysis; and
(B) be open to public comment.
(3) Final regulatory impact analysis.--A final
regulatory impact analysis required under paragraph (1)
shall accompany the final major rule that is the
subject of the analysis.
(c) Content.--Each initial and final regulatory impact
analysis prepared and published under subsection (b) shall
include, with respect to the major rule that is the subject of
the analysis--
(1)
(A) an analysis of the anticipated benefits
and costs of the major rule, which shall be
quantified to the extent feasible;
(B) an analysis of the benefits and costs of
a reasonable number of regulatory alternatives
within the range of the discretion of the
agency under the statute authorizing the major
rule, including alternatives that--
(i) require no action by the Federal
Government; and
(ii)
(I) use incentives and
market-based means to encourage
the desired behavior;
(II) provide information
based upon which the public can
make choices; or
(III) employ other flexible
regulatory options that permit
the greatest flexibility in
achieving the objectives of the
statute authorizing the major
rule; and
(C) an explanation of how the major rule
complies with the requirements of section 205;
(2) an assessment of the extent to which--
(A) the costs to State, local, and Tribal
governments may be paid with Federal financial
assistance (or otherwise paid for by the
Federal Government); and
(B) Federal resources are available to carry
out the major rule;
(3) estimates of--
(A) any disproportionate budgetary effects of
the major rule upon any particular--
(i) regions of the United States;
(ii) State, local, or Tribal
governments;
(iii) types of communities, including
urban or rural communities; or
(iv) segments of the private sector;
and
(B) the effect of the major rule on job
creation or job loss, which shall be quantified
to the extent feasible; and
(4)
(A) a description of the extent of the prior
consultation of the agency under section 204
with elected representatives of each affected
State, local, or Tribal government;
(B) a summary of the comments and concerns
that were presented to the agency orally or in
writing by State, local, or Tribal governments;
and
(C) a summary of the evaluation by the agency
of the comments and concerns described in
subparagraph (B).
[b] (d) Promulgation.--In promulgating a general notice of
proposed rulemaking or a final rule for which [a statement
under subsection (a) is required, the agency shall include in
the promulgation a summary of the information contained in the
statement] an analysis under subsection (b) is required, the
agency promulgating the major rule shall include in the
promulgation a summary of the information contained in the
analysis.
[c] (e) Preparation in Conjunction With Other Statement.--
Any agency may prepare [any statement required under subsection
(a) in conjunction with or as a part of any other statement or
analysis, provided that the statement or analysis satisfies the
provisions of subsection (a)] any analysis required under
subsection (b) in conjunction with, or as a part of, any other
statement or analysis if the other statement or analysis
satisfies the requirements of subsections (b) and (c).
SEC. 203. * * *
SEC. 204. STATE, LOCAL, AND TRIBAL GOVERNMENT AND PRIVATE SECTOR INPUT.
(a) In General.--Each agency shall, to the extent permitted
in law, develop an effective process to permit elected officers
of State, local, and [tribal] Tribal governments (or their
designated employees with authority to act on their behalf),
and impacted parties within the private sector (including small
businesses) to provide meaningful and timely input in the
development of regulatory proposals containing significant
[Federal intergovernmental mandates] Federal mandates.
(b) Meetings Between State, Local, [tribal] Tribal and
Federal Officers.--The Federal Advisory Committee Act (5 U.S.C.
App.) shall not apply to actions in support of
intergovernmental communications where--
(1) meetings are held exclusively between Federal
officials and elected officers of State, local, and
[tribal] Tribal governments (or their designated
employees with authority to act on their behalf) acting
in their official capacities; and
(2) * * *
[(c) Implementing Guidelines.--No later than 6 months after
March 22, 1995, the President shall issue guidelines and
instructions to Federal agencies for appropriate implementation
of subsections (a) and (b) consistent with applicable laws and
regulations.]
(c) Guidelines.--For appropriate implementation of
subsections (a) and (b) consistent with applicable laws and
regulations, the following guidelines shall be followed:
(1) Consultations shall take place as early as
possible, before issuance of a notice of proposed
rulemaking, continue through the final rule stage, and
be integrated explicitly into the rulemaking process.
(2) Agencies shall consult with a wide variety of
State, local, and Tribal officials and impacted parties
within the private sector (including small businesses).
Geographic, political, and other factors that may
differentiate varying points of view should be
considered.
(3) Agencies should estimate benefits and costs to
assist with these consultations. The scope of the
consultation should reflect the cost and significance
of the Federal mandate being considered.
(4) Agencies shall, to the extent practicable--
(A) seek out the views of State, local, and
Tribal governments, and impacted parties within
the private sector (including small
businesses), on costs, benefits, and risks; and
(B) solicit ideas about alternative methods
of compliance and potential flexibilities, and
input on whether the Federal regulation will
harmonize with and not duplicate similar laws
in other levels of government.
(5) Consultations shall address the cumulative impact
of regulations on the affected entities.
(6) Agencies may accept electronic submissions of
comments by relevant parties but may not use those
comments as the sole method of satisfying the
guidelines in this subsection.
[SEC. 205. LEAST BURDENSOME OPTION OR EXPLANATION REQUIRED.] SEC. 205.
MAXIMIZE NET BENEFITS.
[(a) In General.--Except as provided in subsection (b),
before promulgating any rule for which a written statement is
required under section 1532 of this title, the agency shall
identify and consider a reasonable number of regulatory
alternatives and from those alternatives select the least
costly, most cost-effective or least burdensome alternative
that achieves the objectives of the rule, for--
(1) State, local, and tribal governments, in the case
of a rule containing a Federal intergovernmental
mandate; and
(2) the private sector, in the case of a rule
containing a Federal private sector mandate.
(b) Exception.--The provisions of subsection (a) shall
apply unless--
(1) the head of the affected agency publishes with
the final rule an explanation of why the least costly,
most cost-effective or least burdensome method of
achieving the objectives of the rule was not adopted;
or
(2) the provisions are inconsistent with law.
(c) OMB Certification.--No later than 1 year after March
22, 1995, the Director of the Office of Management and Budget
shall certify to Congress, with a written explanation, agency
compliance with this section and include in that certification
agencies and rulemakings that fail to adequately comply with
this section.]
(a) Definition of Cost.--In this section, the term ``cost''
has the meaning given the term in section 202(a).
(b) Requirement.--Before promulgating any proposed or final
major rule for which a regulatory impact analysis is required
under section 202, an agency shall from the alternatives
identified and considered under section 202(c)(1)(B), select
the alternative that maximizes net benefits, taking into
consideration only the costs and benefits that arise within the
scope of the statutory provision that authorizes the
rulemaking.
(c) Exceptions.--An agency may adopt an alternative other
than as required under subsection (b) only if--
(1) the Administrator of the Office of Information
and Regulatory Affairs approves the adoption by the
agency of the alternative; and
(2) the alternative is adopted to--
(A) account for costs or benefits that cannot
be quantified, including costs or benefits
related to constitutional or civil rights,
provided that the agency identifies all such
costs and benefits and explains why those costs
and benefits justify the adoption of the
alternative; or
(B) achieve additional benefits or cost
reductions, provided that the agency--
(i) identifies--
(I) all such additional
benefits and the associated
costs of those benefits; and
(II) all such cost reductions
and the associated benefits of
those cost reductions; and
(ii) explains why--
(I) the additional benefits
justify the additional costs;
or
(II) the additional cost
reductions justify any benefits
foregone.
* * * * * * *
SEC. 208. [ANNUAL STATEMENTS TO CONGRESS ON AGENCY COMPLIANCE.] OFFICE
OF INFORMATION AND REGULATORY AFFAIRS
RESPONSIBILITIES.
[No later than 1 year after March 22, 1995, and annually
thereafter, the Director of the Office of Management and Budget
shall submit to the Congress, including the Committee on
Governmental Affairs of the Senate and the Committee on
Government Reform and Oversight of the House of
Representatives, a written report detailing compliance by each
agency during the preceding reporting period with the
requirements of this subchapter.]
(a) In General.--The Administrator of the Office of
Information and Regulatory Affairs (in this section referred to
as the ``Administrator'') shall provide meaningful guidance and
oversight so that the major rules of an agency for which a
regulatory impact analysis is required under section 202--
(1) are consistent with the principles and
requirements of this title, as well as other applicable
laws; and
(2) and do not conflict with the policies or actions
of another agency.
(b) Notification.--If the Administrator determines that the
major rules of an agency for which a regulatory impact analysis
is required under section 202 do not comply with the principles
and requirements of this title, are not consistent with other
applicable laws, or conflict with the policies or actions of
another agency, the Administrator shall--
(1) identify areas of noncompliance;
(2) notify the agency; and
(3) request that the agency comply before the agency
finalizes the major rule concerned.
(c) Annual Statements to Congress on Agency Compliance.--
The Administrator shall submit to Congress, including the
Committee on Homeland Security and Governmental Affairs of the
Senate and the Committee on Oversight and Reform of the House
of Representatives, an annual written report that, for the 1-
year period preceding the report--
(1) details compliance by each agency with the
requirements of this title that relate to major rules
for which a regulatory impact analysis is required by
section 202, including activities undertaken at the
request of the Administrator to improve compliance; and
(2) contains an appendix detailing compliance by each
agency with section 204.
SEC. 209. INITIATION OF RULEMAKING FOR MAJOR RULES.
When an agency determines to initiate a rulemaking that may
result in a major rule, the agency shall--
(1) establish an electronic docket for that
rulemaking, which may have a physical counterpart; and
(2) publish a notice of initiation of rulemaking in
the Federal Register, which shall--
(A) briefly describe the subject and
objectives of, and the problem to be solved by,
the major rule;
(B) refer to the legal authority under which
the major rule would be proposed, including the
specific statutory provision that authorizes
the rulemaking;
(C) invite interested persons to propose
alternatives and other ideas regarding how best
to accomplish the objectives of the agency in
the most effective manner;
(D) indicate how interested persons may
submit written material for the docket; and
(E) appear in the Federal Register not later
than 90 days before the date on which the
agency publishes a notice of proposed
rulemaking for the major rule.
[SEC. 209.] SEC. 2010. EFFECTIVE DATE.
This title and the amendments made by this title shall take
effect on the date of the enactment of this Act.
* * * * * * *
TITLE IV--JUDICIAL REVIEW
[SEC. 401. JUDICIAL REVIEW].
[(a) Agency Statements on Significant Regulatory Actions.--
(1) In general.--Compliance or noncompliance by any
agency with the provisions of sections 1532 and
1533(a)(1) and (2) of this title shall be subject to
judicial review only in accordance with this section.
(2) Limited review of agency compliance or
noncompliance.--
(A) Agency compliance or noncompliance with
the provisions of sections 1532 and 1533(a)(1)
and (2) of this title shall be subject to
judicial review only under section 706(1) of
title 5, and only as provided under
subparagraph (B).
(B) If an agency fails to prepare the written
statement (including the preparation of the
estimates, analyses, statements, or
descriptions) under section 1532 of this title
or the written plan under section 1533(a)(1)
and (2) of this title, a court may compel the
agency to prepare such written statement.
(3) Review of agency rules.--In any judicial review
under any other Federal law of an agency rule for which
a written statement or plan is required under sections
1532 and 1533(a)(1) and (2) of this title, the
inadequacy or failure to prepare such statement
(including the inadequacy or failure to prepare any
estimate, analysis, statement or description) or
written plan shall not be used as a basis for staying,
enjoining, invalidating or otherwise affecting such
agency rule.
(4) Certain information as part of record.--Any
information generated under sections 1532 and
1533(a)(1) and (2) of this title that is part of the
rulemaking record for judicial review under the
provisions of any other Federal law may be considered
as part of the record for judicial review conducted
under such other provisions of Federal law.
(5) Application of other Federal law.--For any
petition under paragraph (2) the provisions of such
other Federal law shall control all other matters, such
as exhaustion of administrative remedies, the time for
and manner of seeking review and venue, except that if
such other Federal law does not provide a limitation on
the time for filing a petition for judicial review that
is less than 180 days, such limitation shall be 180
days after a final rule is promulgated by the
appropriate agency.
(6) Effective date.--This subsection shall take
effect on October 1, 1995, and shall apply only to any
agency rule for which a general notice of proposed
rulemaking is promulgated on or after such date.
(b) Judicial Review and Rule of Construction.--Except as
provided in subsection (a)--
(1) any estimate, analysis, statement, description or
report prepared under this chapter, and any compliance
or noncompliance with the provisions of this chapter,
and any determination concerning the applicability of
the provisions of this chapter shall not be subject to
judicial review; and
(2) no provision of this chapter shall be construed
to create any right or benefit, substantive or
procedural, enforceable by any person in any
administrative or judicial action.]
SEC. 401. JUDICIAL REVIEW.
(a) In General.--A person that is aggrieved by final agency
action in adopting a major rule that is subject to section 202
is entitled to judicial review of whether the agency complied
with section 202(b), 202(c)(1), or 205 with respect to the
rule.
(b) Scope of Review.--Chapter 7 of title 5, United States
Code, shall govern the scope of judicial review under
subsection (a).
(c) Jurisdiction.--Each court that has jurisdiction to
review a rule for compliance with section 553 of title 5,
United States Code, or under any other provision of law, shall
have jurisdiction to review a claim brought under subsection
(a).
(d) Relief Available.--In granting relief in an action
under this section, a court shall order the agency that
promulgated the major rule that is under review to take
remedial action consistent with chapter 7 of title 5, United
States Code.
* * * * * * *
CONGRESSIONAL BUDGET ACT OF 1974
* * * * * * *
SEC. 421. DEFINITIONS.
For purposes of this part:
(1) Agency.--The term ``agency'' has the same meaning
as defined in section 551(1) of title 5[, but does not
include independent regulatory agencies].
* * * * * * *
SEC. 425. LEGISLATION SUBJECT TO POINT OF ORDER.
(a) * * *
(1) * * *
(2) any bill, joint resolution, amendment, motion, or
conference report that would increase the direct costs
of [Federal intergovernmental mandates] Federal
mandates by an amount that causes the thresholds
specified in [section 424(a)(1)] subsection (a)(1) or
(b)(1) of section 424 of this title to be exceeded,
unless--
* * * * * * *
[all]
