# Regulatory Reform Legislation in the 112th Congress

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URL: https://www.frixlaw.com/law-library/documents/crs%3AR41834

## Record

- **Collection:** Congressional research report
- **Document type:** CRS Report
- **Published:** August 31, 2011
- **Citation:** R41834

## Text

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Regulatory Reform Legislation in
the 112th Congress
Curtis W. Copeland
Specialist in American National Government
August 31, 2011

Congressional Research Service
7-5700
www.crs.gov
R41834

CRS Report for Congress
Prepared for Members and Committees of Congress
c11173008

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Regulatory Reform Legislation in the 112th Congress

Summary
In the 112th Congress, at least 22 bills have been introduced that would, if enacted, change current
requirements in the federal rulemaking process. In the Senate, the proposed legislation includes
(1) S. 128, the Small Business Paperwork Relief Act of 2011; (2) S. 299, the Regulations from the
Executive in Need of Scrutiny Act of 2011; (3) S. 358, the Regulatory Responsibility for Our
Economy Act of 2011; (4) S. 474, the Small Business Regulatory Freedom Act of 2011; (5)
S. 602, the Clearing Unnecessary Regulatory Burdens Act; (6) S. 817, which would make
changes to the application of the Unfunded Mandates Reform Act; (7) S. 1030, the Freedom from
Restrictive Excessive Executive Demands and Onerous Mandates Act of 2011; (8) S. 1189, the
Unfunded Mandates Accountability Act of 2011; (9) S. 1219, the Employment Impact Act of
2011; (10) S. 1338, the Regulatory Capture Prevention Act; (11) S. 1339, the Regulatory
Information Reporting Act; and (12) S. 1438, the Regulation Moratorium and Jobs Preservation
Act of 2011. In the House of Representatives, the bills include (1) H.R. 10, the Regulations from
the Executive in Need of Scrutiny Act of 2011; (2) H.R. 213, the Regulation Audit Revive
Economy Act of 2011; (3) H.R. 214, the Congressional Office of Regulatory Analysis Creation
and Sunset and Review Act of 2011; (4) H.R. 373, the Unfunded Mandates Information and
Transparency Act of 2011; (5) H.R. 527, the Regulatory Flexibility Improvements Act of 2011;
(6) H.R. 1235, the Regulation Moratorium Act of 2011; (7) H.R. 1281, the Restoring Economic
Certainty Act of 2011; (8) H.R. 1432, the Creating Sunshine, Participation, and Accountability for
our Nation Act; (9) H.R. 2175, the Regulatory Balance Act; and (10) H.R. 2204, the Employment
Impact Act of 2011.
This report describes each of these 22 regulatory reform bills, notes whether similar legislation
has been introduced or acted upon in the past, summarizes the comments of those supporting and
opposing the proposed legislation, and provides other relevant information. To put the bills in
context, the report first summarizes the current rulemaking requirements (primarily statutes and
executive orders) that the proposed legislation would amend, codify, or otherwise affect. The
report ends with some concluding observations, noting similarities, differences, and broad themes
in the legislative proposals. Those themes include (1) an expansion of current rulemaking
requirements, (2) an expansion of those requirements to independent regulatory agencies, (3) an
emphasis on retrospective reviews of existing rules, and (4) an increase in the role of Congress in
overseeing the actions of regulatory agencies. Within each of these broad areas, however, the bills
often take very different approaches. Some of the reforms would, if enacted, place new and
potentially substantial responsibilities on federal agencies and the Office of Management and
Budget, which may require additional resources and time to satisfy. Some of the bills may require
clarification to ensure that they are enacted as Congress intended, and some may raise legal or
policy concerns.
This report will be updated to reflect new proposed legislation and actions on bills that have been
introduced.

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Contents
Introduction...................................................................................................................................... 1
Current Rulemaking Requirements ................................................................................................. 1
Administrative Procedure Act ................................................................................................... 1
Paperwork Reduction Act.......................................................................................................... 2
Regulatory Flexibility Act ......................................................................................................... 3
Small Business Regulatory Enforcement Fairness Act ............................................................. 5
Congressional Review Act ........................................................................................................ 6
Unfunded Mandates Reform Act............................................................................................... 7
Small Business Paperwork Relief Act ....................................................................................... 8
Executive Order 12866.............................................................................................................. 8
Executive Order 13422.............................................................................................................. 9
OMB Bulletin on Agency Guidance........................................................................................ 10
Executive Order 13563............................................................................................................ 11
Executive Order 13579............................................................................................................ 12
Other Obama Administration Initiatives.................................................................................. 12
Regulatory Reform Legislation Introduced During the 112th Congress ........................................ 14
Senate Bills.............................................................................................................................. 14
S. 128: the Small Business Paperwork Relief Act of 2011 ............................................... 14
S. 299: the Regulations from the Executive in Need of Scrutiny Act of 2011 .................. 16
S. 358: the Regulatory Responsibility for Our Economy Act of 2011 .............................. 18
S. 474: the Small Business Regulatory Freedom Act of 2011........................................... 20
S. 602: the Clearing Unnecessary Regulatory Burdens (CURB) Act ............................... 25
S. 817: Independent Agencies and the Unfunded Mandates Reform Act ......................... 27
S. 1030, the Freedom from Restrictive Excessive Executive Demands and
Onerous Mandates Act of 2011...................................................................................... 27
S. 1189, the Unfunded Mandates Accountability Act of 2011 .......................................... 29
S. 1219, the Employment Impact Act of 2011 .................................................................. 30
S. 1338, the Regulatory Capture Prevention Act............................................................... 31
S. 1339, the Regulatory Information Reporting Act of 2011 ............................................ 32
S. 1438, the Regulation Moratorium and Jobs Preservation Act of 2011.......................... 33
House Bills .............................................................................................................................. 34
H.R. 10, the Regulations from the Executive in Need of Scrutiny (REINS) Act of
2011................................................................................................................................ 34
H.R. 213, the Regulation Audit Revive Economy (RARE) Act of 2011........................... 34
H.R. 214, the Congressional Office of Regulatory Analysis Creation and Sunset
and Review Act of 2011 ................................................................................................. 36
H.R. 373, the Unfunded Mandates Information and Transparency Act of 2011 ............... 38
H.R. 527, the Regulatory Flexibility Improvements Act of 2011 ..................................... 39
H.R. 1235, the Regulatory Moratorium Act of 2011......................................................... 42
H.R. 1281, the Restoring Economic Certainty Act of 2011 .............................................. 43
H.R. 1432, the Creating Sunshine, Participation, and Accountability for
Our Nation Act ............................................................................................................... 44
H.R. 2175, the Regulatory Balance Act ............................................................................ 45
H.R. 2204, the Employment Impact Act of 2011 .............................................................. 45
Concluding Observations............................................................................................................... 45
Committee Referrals................................................................................................................ 47

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Themes in Regulatory Reform Bills........................................................................................ 48
Expansion of Current Requirements ................................................................................. 52
Independent Regulatory Agencies..................................................................................... 52
Retrospective Reviews ...................................................................................................... 53
Congressional Oversight ................................................................................................... 54
Similarities and Differences in Regulatory Reform Bills........................................................ 55
Reforms May Require Additional Resources and Time .......................................................... 56
Other Issues ............................................................................................................................. 56

Tables
Table 1. House of Representative Committee Referrals of Regulatory Reform Bills
in the 112th Congress................................................................................................................... 47
Table 2. Senate Regulatory Reform Bills Address a Variety of Issues .......................................... 49
Table 3. House Regulatory Reform Bills Address a Variety of Issues........................................... 50

Contacts
Author Contact Information........................................................................................................... 57

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Introduction
Regulations generally start with an act of Congress and are the means by which statutes are
implemented and specific requirements are established. Federal agencies usually issue more than
3,000 final rules each year on topics ranging from the timing of bridge openings to the
permissible levels of arsenic and other contaminants in drinking water. During the past 65 years,
Congress and various Presidents have developed an elaborate set of procedures and requirements
to guide the federal rulemaking process, often with the implicit or explicit goal of reducing the
amount of regulatory burden placed on the public. These cross-cutting statutory and executive
order rulemaking requirements often require some type of analysis or disclosure on the part of the
rulemaking agency before issuing a covered rule, but also often give agencies substantial
discretion regarding whether the requirements are applicable.
In the 112th Congress, at least 22 bills have been introduced that would, if enacted, change many
of the current requirements in the federal rulemaking process. This report will describe many of
those bills, note whether similar legislation has been introduced or acted upon in the past,
summarize the comments of those supporting and opposing the proposed legislation, and provide
other relevant information. The report ends with some concluding observations, noting
similarities, differences, and broad themes in the legislative proposals. To put the regulatory
reform bills in context, however, the report first summarizes the current rulemaking requirements
(primarily statutes and executive orders) that the proposed legislation would amend, codify, or
otherwise affect.

Current Rulemaking Requirements
Administrative Procedure Act
The most long-standing and broadly applicable federal rulemaking requirements are in the
Administrative Procedure Act (APA) of 1946 (5 U.S.C. §551 et seq.). Although the APA discusses
both formal and informal rulemaking, this summary focuses on the more common informal
“notice and comment” rulemaking requirements. For informal rulemaking, the APA generally
requires that agencies (Cabinet departments and independent agencies as well as independent
regulatory agencies such as the Securities and Exchange Commission (SEC) and the Federal
Communications Commission (FCC)) publish a notice of proposed rulemaking (NPRM) in the
Federal Register, and give “interested persons” an opportunity to comment on the proposed rule.1
After considering the public comments, the agency may then publish the final rule, incorporating
a general statement of its basis and purpose. Although the APA does not specify the length of this
public comment period, agencies commonly allow at least 30 days.2 Finally, the APA states that
the final rule cannot become effective until at least 30 days after its publication unless (1) the rule
1

As used in this report, the term “independent regulatory agencies” refers to the boards and commissions identified as
such in the Paperwork Reduction Act (44 U.S.C. §3502(5)), including the Federal Communications Commission, the
Federal Energy Regulatory Commission, the Nuclear Regulatory Commission, and the Securities and Exchange
Commission. The term “independent agencies” refers to other agencies that answer directly to the President, but are not
part of Cabinet departments (e.g., the Environmental Protection Agency and the General Services Administration).
2
Executive Order 12866, discussed in detail later in this report, suggests that agencies allow the public at least 60 days
to comment for “significant” rules.

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grants or recognizes an exemption or relieves a restriction, (2) the rule is an interpretative rule or
a statement of policy, or (3) the agency determines that the rule should take effect sooner for
“good cause,” and publishes that determination with the rule.3
Although the APA generally requires agencies to publish NPRMs before promulgating a final
rule, the act also provides exceptions to this requirement. For example, the APA (5 U.S.C.
§553(b)(B)) states that the notice and comment procedures generally do not apply when an
agency finds, for “good cause,” that those procedures are “impracticable, unnecessary, or contrary
to the public interest.”4 When agencies use the good cause exception, the act requires that they
explicitly say so and provide a rationale for the exception’s use when the rule is published in the
Federal Register. “Interim final” rulemaking can be viewed as a particular application of the
good cause exception in the APA, but with the addition of a comment period after the rule has
become effective.5 Congress sometimes requires agencies to use interim final rulemaking, and
may also specify the length of the comment period.6

Paperwork Reduction Act
The Paperwork Reduction Act (PRA) (44 U.S.C. §§3501-3520) was originally enacted in 1980,
but was subsequently amended in 1986 and again in 1995. One of the purposes of the PRA is to
minimize the paperwork burden for individuals, small businesses, and others resulting from the
collection of information by or for the federal government. The act generally defines a “collection
of information” as the obtaining or disclosure of facts or opinions by or for an agency (Cabinet
departments and independent agencies as well as independent regulatory agencies) by 10 or more
nonfederal persons. Many information collections, recordkeeping requirements, and third-party
disclosures are contained in or are authorized by regulations as monitoring or enforcement tools.
In fact, these paperwork requirements are the essence of many agencies’ regulatory provisions.7
The PRA requires agencies to justify any collection of information from the public by
establishing the need and intended use of the information, estimating the burden that the
collection will impose on respondents, and showing that the collection is the least burdensome
way to gather the information.
3

For a legal overview of rulemaking and judicial review under the APA, see CRS Report R41546, A Brief Overview of
Rulemaking and Judicial Review, by Vanessa K. Burrows and Todd Garvey.
4
The APA also provides explicit exceptions to the NPRM requirement for certain categories of regulatory actions, such
as rules dealing with military or foreign affairs; agency management or personnel; or public property, loans, grants,
benefits, or contracts. Further, the APA says that the NPRM requirements do not apply to interpretative rules; general
statements of policy; or rules of agency organization, procedure, or practice. However, these rules do have to be
published in the Federal Register.
5
For more, see Michael Asimow, “Interim Final Rules: Making Haste Slowly,” Administrative Law Review, 51
(Summer 1999), pp. 703-755.
6
For example, Subsection (b)(2) of Section 1104 of the Patient Protection and Affordable Care Act amended Section
1173 of the Social Security Act (at 42 U.S.C. §1320d-2) and states, in part, that the Secretary “shall promulgate an
interim final rule applying any standard or operating rule recommended by the National Committee on Vital and Health
Statistics,” and “shall accept and consider public comments on any interim final rule published under this subparagraph
for 60 days after the date of such publication.”
7
For example, Environmental Protection Agency’s Toxics Release Inventory (TRI) program is essentially a database
created through collections of information imposed on businesses to inform the public about chemical hazards in their
communities. TRI reports require businesses in certain industries to report the quantity of any of more than 600
chemicals entering each environmental medium on site, transfers of the chemical in wastes to off-site locations, on-site
treatment methods and efficiency, and source reduction and recycling activities.

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The original PRA established the Office of Information and Regulatory Affairs (OIRA) within the
Office of Management and Budget (OMB) to provide central agency leadership and oversight of
government-wide efforts to reduce unnecessary paperwork burden and improve the management
of information resources. Agencies must receive OIRA-approval (signified by an OMB control
number displayed on the information collection) for each collection request before it is
implemented, and those approvals must be renewed at least every three years. Failure to obtain
OIRA approval for an active collection, or the lapse of that approval, represents a violation of the
act, and triggers the PRA’s public protection provision. Under that provision, no one can be
penalized for failing to comply with a collection of information subject to the act if the collection
does not display a valid OMB control number.8 OIRA can disapprove any collection of
information if it believes the collection is inconsistent with the requirements of the PRA.9

Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) of 1980 (5 U.S.C. §§601-612) requires federal agencies to
assess the impact of their forthcoming regulations on “small entities,” which the act defines as
including small businesses, small governmental jurisdictions, and certain small not-for-profit
organizations. Under the RFA, Cabinet departments and independent agencies as well as
independent regulatory agencies must prepare a “regulatory flexibility analysis” at the time
proposed and certain final rules are issued. The RFA requires the analysis to describe, among
other things, (1) the reasons why the regulatory action is being considered; (2) the small entities
to which the proposed rule will apply and, where feasible, an estimate of their number; (3) the
projected reporting, recordkeeping, and other compliance requirements of the proposed rule; and
(4) any significant alternatives to the rule that would accomplish the statutory objectives while
minimizing the impact on small entities. However, these analytical requirements are not triggered
if the head of the issuing agency certifies that the proposed rule would not have a “significant
economic impact on a substantial number of small entities” (hereafter referred to as a
“SEISNSE”). The RFA does not define “significant economic impact” or “substantial number of
small entities,” thereby giving federal agencies substantial discretion regarding when the act’s
analytical requirements are initiated. Also, the RFA’s analytical requirements do not apply to final
rules for which the agency does not publish a proposed rule.
The RFA initially did not permit judicial review of agencies’ actions under the act. However,
amendments to the act in 1996 as part of the Small Business Regulatory Enforcement Fairness
Act (SBREFA, 5 U.S.C. §601 note) permitted judicial review regarding, among other things,
agencies’ regulatory flexibility analyses for final rules and any certifications that their rules will
not have a significant impact on small entities. As a result, a small entity that is adversely affected
or aggrieved by an agency’s determination that its final rule would not have a significant impact
on small entities could seek judicial review of that determination within one year of the date of
the final agency action. In granting relief, a court may remand the rule to the agency or defer
enforcement against small entities.

8

For an up-to-date inventory of OMB-approved information collections, see http://www.reginfo.gov/public/do/
PRAMain.
9
Multi-headed independent regulatory agencies can, by majority vote, void any OIRA disapproval of a proposed
collection of information. See 44 U.S.C. §3507(f). For more information on the PRA, see CRS Report R40636,
Paperwork Reduction Act (PRA): OMB and Agency Responsibilities and Burden Estimates, by Curtis W. Copeland and
Vanessa K. Burrows.

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The RFA also contains several other notable provisions. For example, Section 610 of the act
requires agencies to review those rules that have or will have a significant impact within 10 years
of their promulgation to determine whether they should be continued without change or should be
amended or rescinded to minimize their impact on small entities. Section 612 of the RFA requires
the chief counsel of the Small Business Administration’s (SBA) Office of Advocacy to monitor
and report at least annually on agencies’ compliance with the act. SBA’s primary method of
monitoring agencies’ compliance is to review and comment on proposed regulations when they
are published for notice and comment in the Federal Register. However, the statute also
specifically authorizes the chief counsel to appear as amicus curiae (i.e., “friend of the court”) in
any court action to review a rule.
The RFA also requires agencies to ensure that small entities have an opportunity to participate in
the rulemaking process, and the 1996 amendments to the act in SBREFA required the
Environmental Protection Agency (EPA) and the Occupational Safety and Health Administration
(OSHA) to convene “advocacy review panels” before publishing a regulatory flexibility analysis
for a proposed rule. Specifically, the agency issuing the regulation must notify the SBA chief
counsel for advocacy and provide information on the draft rule’s potential impacts on small
entities and the type of small entities that might be affected. The chief counsel then must identify
representatives of affected small entities within 15 days of the notification. The review panel must
consist of full-time federal employees from the rulemaking agency, OMB, and SBA’s chief
counsel for advocacy. During the panel process, the panel must collect the advice and
recommendations of representatives of affected small entities about the potential impact of the
draft rule. The panel must report on the comments received and on the panel’s recommendations
no later than 60 days after the panel is convened, and the panel’s report must be made public as
part of the rulemaking record.10 The agency may or may not adopt the panel’s recommendations.
The Dodd-Frank Wall Street Reform and Consumer Protection Act (P.L. 111-203) required the
new Consumer Financial Protection Bureau (CFPB) to also hold such panels.
The Government Accountability Office (GAO, formerly the General Accounting Office) has
examined the implementation of the RFA several times within the past 20 years, and a recurring
theme in GAO’s reports is a lack of clarity in the act and a resulting variability in the act’s
implementation. For example, in 1991 GAO reported that each of the four federal agencies that it
reviewed had a different interpretation of key RFA provisions.11 In 1994 GAO again reported that
agencies’ compliance with the RFA varied widely from one agency to another and that agencies
were interpreting the statute differently.12 In a 1999 report on the implementation of Section 610
of the RFA and in a 2000 report on the implementation of the RFA at the EPA, GAO concluded
that agencies had broad discretion to determine what the statute required.13 In all of these reports,
GAO suggested that Congress consider clarifying the act’s requirements and/or give SBA or some
other entity the responsibility to develop criteria for whether and how agencies should conduct
10

For an examination of the first five advocacy review panels were implemented, see U.S. General Accounting Office,
Regulatory Reform: Implementation of the Small Business Advocacy Review Panel Requirements, GAO/GGD-98-36,
March 18, 1996.
11
U.S. General Accounting Office, Regulatory Flexibility Act: Inherent Weaknesses May Limit Its Usefulness for Small
Governments, GAO/HRD-91-16, January 11, 1991.
12
U.S. General Accounting Office, Regulatory Flexibility Act: Status of Agencies’ Compliance, GAO/GGD-94-105,
April 27, 1994.
13
U.S. General Accounting Office, Regulatory Flexibility Act: Agencies’ Interpretations of Review Requirements Vary,
GAO/GGD-99-55, April 2, 1999; U.S. General Accounting Office, Regulatory Flexibility Act: Implementation in EPA
Program Offices and Proposed Lead Rule, GAO/GGD-00-193. September 20, 2000.

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RFA analyses. In 2001, GAO testified that the promise of the RFA may never be realized until
Congress or some other entity defines what a “significant economic impact” and a “substantial
number of small entities” mean in a rulemaking setting.14 However, other observers have
indicated that the definitions of these terms should remain flexible because of significant
differences in each agency’s operating environment.15

Small Business Regulatory Enforcement Fairness Act
Some of the provisions in SBREFA imposed new rulemaking-related requirements on federal
agencies, but did not amend the RFA. For example, Section 212 of SBREFA requires agencies to
develop one or more compliance guides for each final rule or group of related final rules for
which the agency is required to prepare a regulatory flexibility analysis. Specifically, Section 212
requires the guides to (1) be published, (2) be designated as “small entity compliance guides,”
and (3) explain the actions a small entity is required to take to comply with an associated final
rule. However, the discretion inherent in the RFA regarding when a regulatory flexibility analysis
is required also applies to whether compliance guides must be developed. Section 212 gives
agencies broad discretion in other areas as well. For example, it says agencies “may” prepare
separate guides covering groups or classes of similarly affected small entities, and “may”
cooperate with associations of small entities to develop and distribute the guides. Agencies are
given “sole discretion” in the use of plain language in the guides. The statute does not indicate
when the guides must be developed or how they must be “published.” In December 2001, GAO
reported that Section 212 of SBREFA did not appear to have had much of an impact on agencies’
rulemaking activities, and its implementation varied across and sometimes within agencies.16
Using the discretion that the section provided, GAO said “an agency could legally exclude all of
its rules from coverage by the statute, designate a previously published document as its small
entity compliance guide, or develop and publish a guide with no input from small entities years
after the covered rule takes effect.” GAO recommended several changes it felt were needed to
strengthen and clarify the requirements in Section 212.17
Section 223(a) of SBREFA requires federal agencies regulating the activities of small entities to
establish a policy or program for the reduction and, under appropriate circumstances, the waiver
of civil penalties by small entities. In February 2001, GAO concluded that all of the agencies’
penalty reduction and waiver policies were within the broad discretion afforded by the statute.18
However, GAO also reported that some of the policies covered only a portion of the agencies’
enforcement actions involving small entities, and some treated small entities no differently than
14

U.S. General Accounting Office, Regulatory Flexibility Act: Key Terms Still Need to Be Clarified, GAO-01-669T,
April 24, 2001.
15
See, for example, page 17 of the SBA Office of Advocacy’s guidance on the implementation of the RFA, available at
http://www.sba.gov/sites/default/files/rfaguide.pdf, which says “Significance should not be viewed in absolute
terms….” For more information on the RFA, see CRS Report RL34355, The Regulatory Flexibility Act:
Implementation Issues and Proposed Reforms, by Curtis W. Copeland.
16
U.S. General Accounting Office, Regulatory Reform: Compliance Guide Requirement Has Had Little Effect on
Agency Practices, GAO-02-172, December 28, 2001.
17
In 2007, Congress enacted some changes to these requirements. See P.L. 110-28, Title VI, Subtitle B, sec. 7005.
Among other things, agencies must prepare compliance guides for any rule for which it must prepare a final regulatory
flexibility analysis, and must post the guides on their web sites.
18
U.S. General Accounting Office, Regulatory Reform: Implementation of Selected Agencies’ Civil Penalty Relief
Policies for Small Entities, GAO-01-280, February 20, 2001.

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large entities. The agencies’ policies also differed in terms of how key terms such as “small
entity” and “penalty reduction” were defined, and most were developed before SBREFA took
effect. GAO suggested several changes to the statute to strengthen agencies’ penalty relief
policies and make them more consistent.

Congressional Review Act
The statutory provision commonly known as the Congressional Review Act (CRA) (5 U.S.C.
§§801-808) was included as part of SBREFA as enacted in March 1996, and established
expedited procedures by which Congress may disapprove agencies’ rules by enacting a joint
resolution of disapproval.19 Under the CRA, before any final rule can become effective it must be
filed with each house of Congress and GAO.20 The definition of a “rule” under the CRA is very
broad, and the act applies to rules issued by Cabinet departments and independent agencies as
well as independent regulatory agencies.
If OIRA considers the issuing agency’s rule to be “major” (e.g., the rule is expected to have a
$100 million annual effect on the economy), the agency generally must delay the rule’s effective
date by 60 days after the date of publication in the Federal Register or submission to Congress
and GAO, whichever is later. Within 15 calendar days of receiving a major rule, GAO is required
to provide Congress with a report on the rule assessing the issuing agency’s compliance with the
procedural steps required by the various acts and executive orders applicable to the rulemaking
process.21 Although the CRA establishes these special requirements for major rules, the CRA
procedures for disapproving regulations apply to all rules, whether or not they are declared to be
major.
Within 60 days after Congress receives an agency’s rule, excluding periods when Congress is in
recess or adjournment, a Member of Congress can introduce a resolution of disapproval that, if
adopted by both houses and enacted into law, can nullify the rule, even if it has already gone into
effect. Senate action on a disapproval resolution under the act must occur within 60 days of
session after the regulation is submitted, and makes available during that period an expedited
procedure intended to ensure that the Senate can take up and vote on the measure before the
period expires. The act establishes no such expedited procedure for the House. If Congress
adjourns less than 60 days of session after a rule is submitted, a new 60 day period for
disapproval under the act begins on the 15th legislative day of the next session. If a disapproval
resolution is rejected by either house of Congress, the rule can take effect immediately (or as
provided by other governing law or rule).
Federal agencies have submitted more than 50,000 rules to GAO (and presumably, Congress)
since the CRA took effect in March 1996, including more than 1,000 major rules. However, only
one rule had been overturned through CRA’s procedures—OSHA’s ergonomics standard in March
2001 (P.L. 107-5). Many reasons have been suggested for why the CRA has not been used more
often,22 but chief among them may be the fact that, if the President vetoes a resolution of
19

For a detailed discussion of CRA procedures, see CRS Report RL31160, Disapproval of Regulations by Congress:
Procedure Under the Congressional Review Act, by Richard S. Beth.
20
Nevertheless, some rules have not been submitted. See CRS Report R40997, Congressional Review Act: Rules Not
Submitted to GAO and Congress, by Curtis W. Copeland.
21
To view these reports, see http://www.gao.gov/decisions/majrule/majrule.php.
22
Morton Rosenberg, “Whatever Happened to Congressional Review of Agency Rulemaking?: A Brief Overview,
(continued...)

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disapproval (which is likely if the underlying rule is developed during his administration), then
enactment of the resolution would require approval of a two-thirds majority in both houses of
Congress. The rejection of the ergonomics rule was the result of a specific set of circumstances
created by a transition in party control of the presidency. The majority party in both houses of
Congress was the same as the party of the incoming President (George W. Bush). When the new
Congress convened in 2001 and adopted a resolution disapproving the rule published under the
outgoing President (William J. Clinton), the incoming President did not veto the resolution.
Congress may be most able to use the CRA to disapprove rules in similar, transition-related
circumstances.23

Unfunded Mandates Reform Act
The Unfunded Mandates Reform Act (UMRA) of 1995 was enacted in an effort to reduce the
costs associated with federal imposition of responsibilities, duties, and regulations upon state,
local, and tribal governments and the private sector without providing the funding appropriate to
the costs imposed by those responsibilities.24 Title II of UMRA (2 U.S.C. §§1532-1538) contains
requirements imposed on covered federal agencies during the rulemaking process. For example,
Section 202 of the act requires Cabinet departments and independent agencies (but not
independent regulatory agencies) to, among other things, prepare a written statement containing
specific descriptions and estimates for any proposed rule or any final rule for which a proposed
rule was published that includes any federal mandate that may result in the expenditure of $100
million or more in any year by state, local, or tribal governments, in the aggregate, or the private
sector. One of the items required in the written statement is a qualitative and quantitative
assessment of the anticipated costs and benefits of the mandate. OIRA has primary responsibility
for monitoring agency compliance with Title II of UMRA, and publishes an annual report on the
implementation of Title II.25
In February 1998, GAO reported that, because of the way the statute was written, Title II of
UMRA had little effect on agencies’ rulemaking actions during its first two years of
implementation.26 First, many of the act’s requirements did not appear to apply to most of the
“economically significant” rules (e.g., rules with a $100 million impact on the economy) that
were promulgated during this period. Even when UMRA was triggered, it often required agencies
to take actions that were identical or similar to actions that they were already required to take. In
(...continued)
Assessment, and Proposal for Reform,” Administrative Law Review, vol. 51, fall 1999, pp. 1051-1092.
23
See, for example, Susan E. Dudley, “Reversing Midnight Regulations,” Regulation, vol. 24 (Spring 2001), p. 9, who
noted that the “veto threat is diminished [after a transition], since the president whose administration issued the
regulations is no longer in office.” For a discussion of which rules may be carried over and disapproved after a
transition, see CRS Report RL34633, Congressional Review Act: Disapproval of Rules in a Subsequent Session of
Congress, by Curtis W. Copeland and Richard S. Beth.
24
For an overview of UMRA, see CRS Report R40957, Unfunded Mandates Reform Act: History, Impact, and Issues,
by Robert Jay Dilger and Richard S. Beth.
25
In recent years, OIRA’s annual report on UMRA has been combined with its report on the costs and benefits of
federal regulations. See, for example, Office of Management and Budget, Office of Information and Regulatory
Affairs, 2010 Report to Congress on the Benefits and Costs of Federal Regulations and Unfunded Mandates on State,
Local, and Tribal Entities, available at http://www.whitehouse.gov/sites/default/files/omb/legislative/reports/
2010_Benefit_Cost_Report.pdf.
26
U.S. General Accounting Office, Unfunded Mandates: Reform Act Has Had Little Effect on Agencies’ Rulemaking
Actions, GAO/GGD-98-30, February 4, 1998.

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May 2004, GAO again reported that UMRA’s written statement requirements did not apply to
most major or economically significant final rules issued in 2001 and 2002, even though some of
the rules “appeared to have potential financial impacts on affected nonfederal parties similar to
those of the actions that were identified as containing mandates at or above the act’s
thresholds.”27 In February 2011, GAO reiterated these conclusions, noting that there are 14
reasons why a rule would not be considered a “mandate” under UMRA.28

Small Business Paperwork Relief Act
In June 2002, Congress enacted and the President signed the Small Business Paperwork Relief
Act of 2002 (P.L. 107-198). The act amended the Paperwork Reduction Act to, among other
things, require each agency to establish a single point of contact to act as a liaison for small
business concerns with regard to information collection and paperwork issues. It also directed
agencies to make a special effort to reduce information collection burdens for small businesses
with fewer than 25 employees. OMB was directed to publish in the Federal Register and make
available on the Internet an annual list of the compliance assistance resources available to small
businesses.29 The act also required agencies to report to Congress on the amount of penalty relief
provided to small businesses, and established a task force to study the feasibility of streamlining
information collection requirements on small businesses.30

Executive Order 12866
Centralized review of agencies’ regulations within the Executive Office of the President has been
part of the federal rulemaking process for more than 30 years, perhaps most notably by President
Ronald Reagan in Executive Order 12291.31 The current process is delineated in Executive Order
12866, which was issued by President William Clinton on September 30, 1993.32 The executive
order limits OIRA’s reviews to proposed and final rules published by agencies other than
independent regulatory agencies,33 and to actions identified by the rulemaking agency or OIRA as
“significant” regulatory actions, defined as those that were “economically significant” (e.g., those
with a $100 million impact on the economy) or that (1) were inconsistent or interfered with an
action taken or planned by another agency; (2) materially altered the budgetary impact of
entitlements, grants, user fees, or loan programs; or (3) raised novel legal or policy issues. OIRA
reviews between 500 and 700 regulatory actions per year.
27
U.S. General Accounting Office, Unfunded Mandates: Analysis of Reform Act Coverage, GAO-04-637, May 12,
2004.
28
Testimony of Denise M. Fantone, Director, Strategic Issues, U.S. Government Accountability Office, before the
Subcommittee on Technology, Information Policy, Intergovernmental Relations and Procurement Reform, House
Committee on Oversight of Government Management, available at http://www.gao.gov/products/GAO-11-385T.
29
These lists of compliance assistance resources are available at http://www.sba.gov/category/navigation-structure/
starting-managing-business/starting-business/business-law-regulations/contact-government-agency/fe.
30
See http://www.whitehouse.gov/sites/default/files/omb/assets/omb/inforeg/sbpr2004.pdf for a copy of the task
force’s June 28, 2004, final report.
31
The President, “Executive Order 12291—Federal Regulation,” 46 Federal Register 13193, February 17, 1981.
32
The President, “Executive Order 12866—Regulatory Planning and Review,” 58 Federal Register 51735, October 4,
1993.
33
Independent regulatory agencies are, however, covered by requirements in Section 4 of Executive Order 12866
regarding regulatory planning.

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Executive Order 12866 generally requires that OIRA complete its reviews of proposed and final
rules within 90 calendar days, and requires both rulemaking agencies and OIRA to disclose
certain information about how the regulatory reviews were conducted. The executive order
requires the issuing agency to provide to OIRA the text of the draft rule, a description of why the
rule is needed, and a general assessment of the rule’s costs and benefits. For draft rules that are
“economically significant” (e.g., rules expected to have at least a $100 million annual impact on
the economy), it requires a detailed cost-benefit analysis, including an assessment of the costs and
benefits of “potentially effective and reasonably feasible alternatives to the planned regulation.”
The executive order states that agencies shall “propose or adopt a regulation only upon a reasoned
determination that the benefits of the intended regulation justify its costs,” and that unless a
statute requires another regulatory approach, “in choosing among alternative regulatory
approaches, agencies should select those approaches that maximize net benefits.”34
During the review process, OIRA analyzes the draft rule in light of the principles of the executive
order and discusses the rule with staff and officials at the rulemaking agency. At the end of the
review OIRA either concludes that the draft rule is consistent with the principles of the executive
order (the majority of the cases) or returns the rule to the agency “for further consideration.” If
the draft is a proposed rule, the agency may then publish an NPRM. If the draft is a final rule, the
agency may then publish a final rule and allow the rule to take effect.
Executive Order 12866 also includes several other notable requirements. For example, Section
5(a) of the order requires agencies to periodically review their existing significant regulations to
determine whether they should be modified or eliminated. In March 1995, President Clinton
reemphasized this requirement by directing each agency to conduct a page-by-page review of all
existing regulations. In June 1995, the President announced that 16,000 pages had been
eliminated from the Code of Federal Regulations, but GAO reported that the page elimination
totals in four agencies did not take into account pages that had been added while the eliminations
took place.35 GAO also reported that about half of the actions taken appeared to have no effect on
the burden felt by regulated entities, would have little effect, or could increase regulatory burden.

Executive Order 13422
On January 18, 2007, President George W. Bush issued Executive Order 13422, making the most
significant amendments to Executive Order 12866 since it was published.36 The most important
changes fell into five general categories: (1) a requirement that agencies identify in writing the
specific market failure or problem that warrants a new regulation, (2) a requirement that each
agency head designate a presidential appointee within the agency as a “regulatory policy officer”
34
In January 1996, OIRA published a document that described “best practices” for preparing the economic analyses
called for by the executive order. This document was revised and issued as guidance in 2000. In September 2003, OMB
and the Council of Economic Advisors finalized new guidance for agencies on regulatory analysis, refining and
replacing the 1996 “best practices” document. For a copy of this guidance, see http://www.whitehouse.gov/omb/
circulars/a004/a-4.pdf.
35
U.S. General Accounting Office, Regulatory Reform: Agencies’ Efforts to Eliminate and Revise Rules Yield Mixed
Results, GAO/GGD-98-3, October 2, 1997.
36
The President, Executive Order 13422, “Further Amendment to Executive Order 12866 on Regulatory Planning and
Review,” 72 Federal Register 2763, January 23, 2007. Five years earlier, E.O. 13258 reassigned certain responsibilities
from the Vice President to the President’s chief of staff, but otherwise did not change the OIRA review process. See
Executive Order 13258, “Amending Executive Order 12866 on Regulatory Planning and Review,” 67 Federal Register
9385, February 28, 2002.

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who can control upcoming rulemaking activity in that agency, (3) a requirement that agencies
provide their best estimates of the cumulative regulatory costs and benefits of rules they expect to
publish in the coming year, (4) an expansion of OIRA review to include “significant guidance
documents,”37 and (5) a provision permitting agencies to consider whether to use more formal
rulemaking procedures in certain cases. 38 Some of these changes were highly controversial, and
in the first half of 2007, two House subcommittees held three oversight hearings on the order. A
provision was added to the appropriations measure funding OMB for FY2008 that would have
prevented the implementation of the executive order, but the measure was eliminated from the
final version of the legislation. On January 30, 2009, President Barack Obama issued Executive
Order 13497, which (among other things) revoked Executive Order 13422.39 As a result,
Executive Order 12866 was returned to the form when it was issued in September 1993. Less
than two months later, though, the Director of OMB instructed federal agencies to continue
sending their significant guidance documents to OIRA for review.40

OMB Bulletin on Agency Guidance
On the same day that President Bush issued Executive Order 13422, OMB issued a “Final
Bulletin for Agency Good Guidance Practices” that mirrored, in many respects, the guidance
provisions in the executive order.41 Unlike the order, however, the bulletin has not been revoked.
It generally requires agencies to (1) have written procedures for the approval of significant
guidance documents; (2) include certain standard elements in those documents (e.g., include a
citation to the statute or regulation that it interprets, and not include mandatory language such as
“shall” or “must”); (3) list those documents on the agencies’ websites and allow the public to
submit electronic comments; and (4) publish a notice in the Federal Register soliciting public
comments on “economically significant” documents. OMB later issued a memorandum to the
agencies on the implementation of the bulletin.42

37
The executive order defined a “significant guidance document” as a guidance document disseminated to regulated
entities or the public that may reasonably be anticipated to “(A) Lead to an annual effect 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; (B) Create a serious
inconsistency or otherwise interfere with an action taken or planned by another agency; (C) Materially alter the
budgetary impact of entitlements, grants, user fees, or loan programs or the rights or obligations of recipients thereof;
or (D) Raise novel legal or policy issues arising out of legal mandates, the President’s priorities, or the principles set
forth in this Executive order.”
38
For more information, see CRS Report RL33862, Changes to the OMB Regulatory Review Process by Executive
Order 13422, by Curtis W. Copeland.
39
Executive Order 13497, “Revocation of Certain Executive Orders Concerning Regulatory Planning and Review,” 74
Federal Register 6113, February 4, 2009.
40
See http://www.whitehouse.gov/sites/default/files/omb/assets/memoranda_fy2009/m09-13.pdf for a copy of this
memorandum.
41
To view a copy of this bulletin, see http://www.whitehouse.gov/omb/memoranda/fy2007/m07-07.pdf; and Office of
Management and Budget, “Final Bulletin for Agency Good Guidance Practices,” 72 Federal Register 3432, January
25, 2007.
42
See http://www.whitehouse.gov/sites/default/files/omb/assets/regulatory_matters_pdf/m07-13.pdf for a copy of this
memorandum.

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Executive Order 13563
On January 18, 2011, President Obama issued Executive Order 13563 on “Improving Regulation
and Regulatory Review.”43 Section 1(b) states that “This order is supplemental to and reaffirms
the principles, structures, and definitions governing contemporary regulatory review that were
established in Executive Order 12866 of September 30, 1993.” Although similar to the 1993 order
in many respects, Executive Order 13563 contains some new provisions. For example, Section
2(b) of the order states that agencies should generally provide “timely online access to the
rulemaking docket on regulations.gov, including relevant scientific and technical findings, in an
open format that can be easily searched and downloaded. For proposed rules, such access shall
include, to the extent feasible and permitted by law, an opportunity for public comment on all
pertinent parts of the rulemaking docket, including relevant scientific and technical findings.”
Also, Section 6(b) of the new order requires agencies to initiate retrospective reviews of their
existing rules. Specifically, it states the following:
Within 120 days of the date of this order [i.e., by May 18, 2011], each agency shall develop
and submit to the Office of Information and Regulatory Affairs a preliminary plan, consistent
with law and its resources and regulatory priorities, under which the agency will periodically
review its existing significant regulations to determine whether any such regulations should
be modified, streamlined, expanded, or repealed so as to make the agency’s regulatory
program more effective or less burdensome in achieving the regulatory objectives.

As noted earlier in this report, Section 5(a) of Executive Order 12866 required agencies to submit
a plan for retrospective reviews to OIRA, so this provision appears to require agencies to update
those plans. On February 2, 2011, the OIRA Administrator issued guidance to federal agencies on
the implementation of the executive order, including these retrospective reviews.44 In that
guidance, the Administrator noted that although the executive order did not apply to independent
regulatory agencies, they were “encouraged to consider undertaking, on a voluntary basis,
retrospective analysis of their existing rules.”
Several federal agencies have published notices in the Federal Register requesting comments on
their review plans.45 On April 25, 2011, the OIRA Administrator issued another memorandum to
the heads of executive departments and agencies providing guidance on the processes through
which agencies’ preliminary plans for retrospective reviews will be finalized.46 Among other
things, agencies were instructed to make their preliminary plans available to the public within two
weeks of May 18, 2011, and should finalize those plans within 80 days after they are released.

43

Executive Order 13563, “Improving Regulation and Regulatory Review,” 76 Federal Register 3821, January 21,
2011.
44
See http://www.whitehouse.gov/sites/default/files/omb/memoranda/2011/m11-10.pdf.
45
See, for example, U.S. Department of Transportation, Office of the Secretary, “Regulatory Review of Existing DOT
Regulations,” 76 Federal Register 8940, February 16, 2011; and U.S. Environmental Protection Agency, “Improving
EPA Regulations,” 76 Federal Register 9988, February 23, 2011.
46
See http://www.whitehouse.gov/sites/default/files/omb/memoranda/2011/m11-19.pdf.

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Executive Order 13579
Although OMB encouraged independent regulatory agencies to comply with Executive Order
13563 and voluntarily develop plans for the retrospective review of their existing rules, most of
them reportedly did not do so.47 On July 11, 2011, President Obama issued Executive Order
13579, which was intended to encourage independent regulatory agencies to review their existing
rules.48 Specifically, Section 2(b) of that order states the following:
Within 120 days of the date of this order, each independent regulatory agency should
develop and release to the public a plan, consistent with law and reflecting its resources and
regulatory priorities and processes, under which the agency will periodically review its
existing significant regulations to determine whether any such regulations should be
modified, streamlined, expanded, or repealed so as to make the agency’s regulatory program
more effective or less burdensome in achieving the regulatory objectives.

In a memorandum issued the same day as the executive order, the President said he made the
request “with full respect for the independence” of these agencies.49

Other Obama Administration Initiatives
The Obama Administration has also announced several other initiatives related to the rulemaking
process. For example:
•

On April 7, 2010, the OIRA Administrator issued a memorandum to the
President’s Management Council instructing agencies to use the Regulation
Identification Number on all relevant documents to improve the transparency of
the rulemaking process.50

•

On May 28, 2010, the OIRA Administrator issued two memoranda. One
memorandum to the heads of cabinet departments and agencies outlined the
availability and uses of “generic” information clearances under the Paperwork
Reduction Act as a way for agencies to meet the act’s requirements while
eliminating unnecessary burdens and delays.51 The other memorandum to the
President’s Management Council provided “guidance to agencies in compiling
and maintaining comprehensive electronic regulatory dockets on
Regulations.gov, in order to give members of the public improved access to
information on which agencies rely in making decisions relevant to
rulemaking.”52

47

Cheryl Bolen, “Obama Asks Independent Agencies To Comply With Regulatory Review Order,” BNA Daily Report
for Executives, July 11, 2011, p. A-7.
48
To view a copy of this executive order, see http://www.whitehouse.gov/the-press-office/2011/07/11/executive-orderregulation-and-independent-regulatory-agencies.
49
See http://www.whitehouse.gov/the-press-office/2011/07/11/memorandum-regulation-and-independent-regulatoryagencies. See also http://www.whitehouse.gov/blog/2011/07/11/president-s-executive-order-improving-andstreamlining-regulation-independent-regula.
50
See http://www.whitehouse.gov/sites/default/files/omb/assets/inforeg/IncreasingOpenness_04072010.pdf.
51
See http://www.whitehouse.gov/sites/default/files/omb/assets/inforeg/PRA_Gen_ICRs_5-28-2010.pdf.
52
See http://www.whitehouse.gov/sites/default/files/omb/assets/inforeg/edocket_final_5-28-2010.pdf.

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•

On June 18, 2010, the OIRA Administrator issued a memorandum to the heads of
cabinet departments and agencies setting out guidance to inform the use of
disclosure and simplification in the regulatory process (e.g., that disclosed
information should be as accessible and usable as possible, and that agencies
should consider using default rules as a substitute for or a supplement to
mandates and bans).53

•

On January 18, 2011 (the same day that Executive Order 13563 was issued),
President Obama issued a memorandum on “Regulatory Flexibility, Small
Business, and Job Creation.”54 Among other things, the President directed
executive departments and agencies, and requested independent regulatory
agencies, to “give serious consideration to whether and how it is appropriate,
consistent with law and regulatory objectives, to reduce regulatory burdens on
small businesses, through increased flexibility” when they issue a proposed or
final rule that will have a significant economic impact on a substantial number of
small entities. When an agency chooses not to provide such flexibility, the
President directed the agency to “explicitly justify its decision not to do so in the
explanation that accompanies that proposed or final rule.”

•

Also on January 18, 2011, President Obama issued a memorandum on
“Regulatory Compliance.”55 Among other things, the memorandum directed
agencies with broad compliance and enforcement responsibilities to develop
plans to make public information on those responsibilities accessible,
downloadable, and searchable online, and directed the Federal Chief Information
Officer and Chief Technology Officer to work with their agency counterparts to
explore how to generate and share enforcement and compliance information
across the government.

•

On March 11, 2011, the OIRA Administrator, the Director of the Office of
Science and Technology Policy, and the U.S. Trade Representative issued a joint
memorandum on “Principles for Regulation and Oversight of Emerging
Technologies.”56 Areas covered by the memorandum included public
participation, benefits and costs, flexibility, and coordination.

•

On April 13, 2011, the OIRA Administrator issued a memorandum to the heads
of executive departments and agencies providing final guidance on implementing
the Plain Writing Act of 2010 (P.L. 111-274).57 For example, by July 13, 2011,
agencies must create a plain writing section on their websites, and by October 13,
2011, they must write all new or substantially revised documents in plain writing.

53

See http://www.whitehouse.gov/sites/default/files/omb/assets/inforeg/disclosure_principles.pdf.
See http://www.whitehouse.gov/sites/default/files/omb/inforeg/for-agencies/POTUS-Memo-on-RegulatoryFlexibility-Small-Business-and-Job-Creation-01-18-2011.pdf. See also The President, “Regulatory Flexibility, Small
Business, and Job Creation,” 76 Federal Register 3827, January 21, 2011.
55
See http://www.whitehouse.gov/sites/default/files/omb/inforeg/for-agencies/POTUS-Memo-on-RegulatoryCompliance-01-18-2011.pdf. See also The President, “Regulatory Compliance,” 76 Federal Register 3825, January 21,
2011.
56
See http://www.whitehouse.gov/sites/default/files/omb/inforeg/for-agencies/Principles-for-Regulation-andOversight-of-Emerging-Technologies-new.pdf.
57
See http://www.whitehouse.gov/sites/default/files/omb/memoranda/2011/m11-15.pdf.
54

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Regulatory Reform Legislation Introduced During
the 112th Congress
The remainder of this report discusses various crosscutting regulatory reform bills that had been
introduced in the 112th Congress as of the date of this report. The report includes only legislation
designed to result in public laws, and does not include other types of legislation (e.g., H.Res. 72,
which directed certain standing committees to inventory and review existing, pending, and
proposed regulations and orders from agencies, particularly with respect to their effect on jobs
and economic growth). It also does not include bills designed to affect rulemaking in only one
agency (e.g., H.R. 128, which would direct the Secretary of Labor to revise regulations
concerning the recording and reporting of occupational injuries and illnesses under the
Occupational Safety and Health Act of 1970; and H.R. 2401, which focuses on certain rules
issued by EPA). Neither does the report include bills focusing only on judicial review of rules
(e.g., H.R. 455, which would authorize a state official to file a legal brief challenging the
constitutionality of a rule under the Tenth Amendment) or litigation (e.g., H.R. 1996 and S. 1061,
which would limit reimbursement of legal fees in cases brought against federal agencies).
The report first presents the regulatory reform bills that have been introduced in the Senate, and
then discusses the bills that have been introduced in the House of Representatives. In some cases,
virtually the same proposed legislation has been introduced in both chambers (e.g., S. 299 and
H.R. 10). For each bill, the report provides the bill number, the title, the primary sponsor of the
proposed legislation, the date that it was introduced, and the committee(s) to which it was
referred. The report then describes each bill’s main provisions, and an “analysis” section for each
bill discusses any similar or related legislation that has been enacted or considered in the past, and
other potentially relevant information.

Senate Bills
S. 128: the Small Business Paperwork Relief Act of 2011
S. 128, introduced by Senator David Vitter on January 25, 2011, and referred to the Senate
Committee on Homeland Security and Governmental Affairs, would amend the Paperwork
Reduction Act (adding a new subsection (j) to 44 U.S.C. §3506) and direct agency heads not to
impose civil fines for first-time paperwork violations by “small business concerns,” unless the
agency head determines that (1) there is potential for “serious harm to the public interest;” (2) the
detection of criminal activity would be impaired; (3) the violation is not corrected within six
months of written notification from the agency; (4) the violation involves an internal revenue law
or a law concerning the assessment or collection of any tax, debt, revenue, or receipt; or (5) the
violation presents a “danger to the public health or safety.” If a small business had previously
violated any of the same agency’s information collection requirements, the prohibition on civil
fines is not applicable.
Even if the agency head determines that a violation presents a danger to public health or safety,
the bill allows an agency to decide not to impose a civil fine if the violation is corrected within 24
hours after the small business owner is notified of the violation. The agency head is to take into
account such factors as the nature and seriousness of the violation, whether the small business has
made a good-faith effort to comply, and whether the small business obtained a significant

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economic benefit from the violation. If an agency does not allow a small business 24 hours to
correct such a violation, the agency head is required to notify Congress within 60 days after the
imposition of the civil fine. If a small business had previously violated any of the same agency’s
information collection requirements, the prohibition on civil fines is not applicable. However,
agencies are prohibited from considering information collection violations in other agencies.

Analysis
Similar penalty-relief legislation has been introduced but not enacted for more than 10 years (e.g.,
S. 1116 in the 111th Congress and S. 281 in the 110th Congress, both of which were also
introduced by Senator Vitter). In 1999, the House of Representatives passed a bill (H.R. 391 in
the 106th Congress) that would have barred federal agencies from issuing penalties for most firsttime paperwork violations, but similar legislation was not passed by the Senate. Supporters of
such legislation in the past have said that agencies that promulgate new paperwork requirements
often forget that small businesses face numerous other paperwork requirements from other
agencies, and that small businesses are concerned about violating requirements that they do not
know about. Opponents, however, have asserted that the legislation could encourage companies
to violate the law, could prevent detection of serious violations, and that a single company could
be a “first-time” violator in different agencies.58 They also contended that agencies already
typically provide penalty relief for first-time paperwork violations except in the most egregious
cases.
As noted previously in this report, many information collections, recordkeeping requirements,
and third-party disclosures are contained in or are authorized by regulations as monitoring or
enforcement tools, and are the essence of many agencies’ regulatory provisions (e.g., the EPA
Toxics Release Inventory program). However, because S. 128 does not define such terms as
“serious harm to the public interest,” the bill appears to give agency heads substantial discretion
to decide when penalty relief will be provided. Also, although an agency must notify Congress
when a small business is not given 24 hours to correct a violation that “presents a danger to the
public health or safety,” if the agency head concludes that some other exception applies (e.g., that
the violation could cause “serious harm to the public interest”), then no such notification appears
to be necessary.
Congress has enacted legislation that is somewhat related to this issue. As noted earlier in this
report, Section 223(a) of SBREFA (enacted in March 1996) required federal agencies regulating
the activities of small entities to establish a policy or program for the reduction and, under
appropriate circumstances, the waiver of civil penalties for small entities. However, GAO
reported in February 2001 that the five agencies it examined had such policies, but some of the
policies gave small entities no more penalty relief than provided to large entities, and other
policies covered only certain types of actions.59
In 2002, Congress enacted the Small Business Paperwork Reduction Act (P.L. 107-198), which
established an interagency task force to study the feasibility of streamlining small business
58
See, for example, Ralph Lindeman, “Witnesses Debate Need for Legislation Giving Businesses Paperwork Relief,”
BNA Daily Report for Executives, September 27, 2006, p. A-45. The legislation under consideration at the time was S.
2656 and H.R. 5242, 109th Congress.
59
U.S. General Accounting Office, Regulatory Reform: Implementation of Selected Agencies’ Civil Penalty Relief
Policies for Small Entities, GAO-01-280, February 20, 2001.

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paperwork requirements. (An amendment to this legislation that would have barred penalties for
first-time paperwork violations was defeated.) In its June 2004 final report, the task force
described opportunities to consolidate and coordinate information dissemination efforts,
described an interactive web-based system to help small businesses understand and comply with
paperwork requirements, and identified other opportunities to provide assistance to small
businesses.60 The legislation also required OMB and SBA to establish a list of compliance
assistance resources, and required each agency to establish a single point of contact for small
business concerns.61

S. 299: the Regulations from the Executive in Need of Scrutiny Act of 2011
S. 299, introduced by Senator Rand Paul on February 7, 2011, and referred to the Senate
Committee on Homeland Security and Governmental Affairs, would, if enacted, amend the
Congressional Review Act to require congressional approval of major rules before they could
take effect. The bill defines a “major rule” as any rule that the OIRA Administrator finds has
resulted in or is likely to result in (1) an annual effect on the economy of $100 million or more;
(2) a major increase in costs or prices; or (3) significant adverse effects on competition,
employment, investment, productivity, innovation, or U.S. competitiveness. The joint resolution
of approval may be introduced on or after the date the rule is received by Congress, and must
state the following: “That Congress approves the rule submitted by the __ relating to __ .” (with
the blank spaces appropriately filled in). The majority leader of the House of Representatives and
the majority leader of the Senate (or their designees) would be required to introduce the joint
resolutions in each chamber within three days after Congress receives a major rule. The joint
resolutions would then be referred to the committees of jurisdiction in each house.
If the House and Senate committees to which the joint resolution is referred have not reported the
resolution within 15 legislative or session days of its introduction, the committees are
automatically discharged of their responsibilities and the resolution is to be placed on the calendar
in each chamber. A vote on final passage of the joint resolution is required within 15 days of its
being reported by or discharged from the committees. Once a joint resolution is on the Senate
calendar, a motion to proceed is in order, and all points of order are waived. In the House, a
motion to proceed is considered privileged and not debatable. The joint resolution is not subject
to amendment, or to a motion to postpone or proceed to other business. Debate is limited to not
more than two hours, divided equally between those favoring and opposing the resolution.
S. 299 states that if a joint resolution of approval for a major rule is not enacted by the end of 70
session days or legislative days after the issuing agency submits the rule to Congress (excluding
days when either house is adjourned for more than three days), the rule is deemed not approved
and cannot take effect. However, the proposed legislation permits a major rule to take effect for
90 calendar days without congressional approval if the President determines (by executive order)
that the rule is necessary because of an imminent threat to health or safety or other emergency, for
the enforcement of criminal laws, for national security, or to implement an international trade
agreement.

60

See http://www.whitehouse.gov/sites/default/files/omb/assets/omb/inforeg/sbpr2004.pdf for a copy of this report.
See http://www.sba.gov/category/navigation-structure/starting-managing-business/starting-business/business-lawregulations/contact-government-agency/fe for this information.

61

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S. 299 also states that the enactment of a joint resolution of approval does not provide or modify
the statutory authority for the rule, and does not affect any claim against an alleged defect in the
rule. The bill also clarifies that, notwithstanding the CRA’s prohibition on judicial review, “a
court may determine whether a Federal Agency has completed the necessary requirements under
this chapter for a rule to take effect.”
The procedures requiring congressional approval for major rules, and permitting congressional
disapproval for non-major rules, do not apply to rules concerning monetary policy from the Board
of Governors of the Federal Reserve System or the Federal Open Market Committee. Rules that
establish, modify, open, close, or conduct a regulatory program for a commercial, recreational, or
subsistence activity related to hunting, fishing, or camping; and non-major rules for which the
agency invokes the “good cause” exception to notice and comment, can take effect at such time as
the promulgating agency determines.62

Analysis
In contrast to the CRA disapproval process for all rules, the REINS Act would require
congressional approval before a major rule could take effect. (Non-major rules would take effect
as otherwise provided in law, and Congress could still disapprove non-major rules through the
CRA or some other legislative process.) Supporters of the legislation assert that it would allow
Congress to reclaim its legislative responsibility and better oversee the regulations being written
pursuant to congressionally established requirements or authorities.63 Opponents, however, have
expressed concerns about the constitutionality of the REINS Act, about whether Congress has the
time or expertise necessary to approve or disapprove as many as 100 major rules each year, and
whether the legislation is even necessary for Congress to oversee the federal rulemaking
process.64
Somewhat similar legislation has been previously introduced but not acted upon. For example, in
the 106th Congress, S. 1348 (the Congressional Responsibility Act of 1999) would have required
Congress to enact a bill containing the text of a final rule (not just major rules) before it could
take effect. H.R. 110 in the 108th Congress (the Congressional Responsibility Act of 2003) would
have required a similar approach. Also in the 106th Congress, S. 2670 (the Congressional
Regulatory Reform Act of 2000) would have required Congress to enact a joint resolution of
approval before any major rule could take effect. In the 111th Congress, H.R. 3765 and S. 3826

62
The Administrative Procedure Act (APA) of 1946 (5 U.S.C. §551 et seq.) generally requires agencies to publish a
notice of proposed rulemaking soliciting comments from the public, and then publish a final rule. However, the APA (5
U.S.C. §553(b)(B)) states that the notice and comment procedures generally do not apply when an agency finds, for
“good cause,” that those procedures are “impracticable, unnecessary, or contrary to the public interest.”
63
See, for example, testimony of David McIntosh, before the Subcommittee on Courts, Commercial and
Administrative Law, House Committee on the Judiciary, January 24, 2011, available at http://judiciary.house.gov/
hearings/pdf/McIntosh01242011.pdf; and testimony of Eric R. Claeys, Professor of Law, George Mason University,
before the Subcommittee on Courts, Commercial and Administrative Law, House Committee on the Judiciary, March
8, 2011, available at http://judiciary.house.gov/hearings/pdf/Claeys03082011.pdf.
64
See, for example, testimony of Sally Katzen, before the Subcommittee on Courts, Commercial and Administrative
Law, House Committee on the Judiciary, January 24, 2011, available at http://judiciary.house.gov/hearings/pdf/
Katzen01242011.pdf; and testimony of David Goldston, Director of Government Affairs, Natural Resources Defense
Council, before the Subcommittee on Courts, Commercial and Administrative Law, House Committee on the Judiciary,
March 8, 2011, available at http://judiciary.house.gov/hearings/pdf/Goldston03082011.pdf.

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(the Regulations from the Executive in Need of Scrutiny Act) would have also required Congress
to enact a joint resolution of approval before any major rule could take effect.
The provision in S. 299 clarifying that “a court may determine whether a Federal Agency has
completed the necessary requirements under this chapter for a rule to take effect” could make it
more likely that agencies would submit their covered rules to GAO and Congress.65 The courts
have generally interpreted the CRA to conclude that they do not have judicial review over
whether agencies must submit their rules to GAO and Congress before they can take effect.66
A February 2011 CRS report provided information on the number of major rules issued in recent
years, and noted that the 100 major rules issued in calendar year 2010 were considered major for
a variety of reasons—not just compliance costs.67 For example, 37 of the rules appeared to be
major because they involved transfers of funds from one party to another (most commonly,
federal funds to the recipients of those funds). Ten other rules appeared to be major because they
were expected to prompt consumer spending, or because they established fees for the
reimbursement of federal functions. Thirty-nine rules appeared major because they were expected
to result in at least $100 million in annual compliance costs, regulatory benefits, or both. In
almost all of these rules, the estimated benefits exceeded the estimated costs. In only one rule was
the agency’s estimate of benefits lower than the estimated costs, and the agency indicated that the
costs were driven by the specific requirements in the underlying statute.68

S. 358: the Regulatory Responsibility for Our Economy Act of 2011
S. 358, introduced by Senator Pat Roberts on February 15, 2011, and referred to the Senate
Committee on Homeland Security and Governmental Affairs, would, if enacted, put into statute
many of the broad regulatory goals enunciated in Executive Orders 12866 and 13563 (e.g., that
federal agencies should adopt regulations only upon a reasoned determination that the benefits
justify the costs, tailor regulations to accomplish regulatory objectives while imposing the least
burden on society, select regulatory approaches that maximize net benefits, and allow for public
participation). However, because the bill defines a covered “agency” to include independent
regulatory agencies like the FCC and the SEC, the impact of S. 358 would be broader than the
executive orders (which do not cover independent regulatory agencies). Exempt from these
principles and other requirements in the bill are regulations that (1) are issued through formal
rulemaking procedures in 5 U.S.C. 556 and 5 U.S.C. 557;69 (2) pertain to military or foreign
affairs functions, other than procurement regulations and regulations involving the import or

65
See CRS Report R40997, Congressional Review Act: Rules Not Submitted to GAO and Congress, by Curtis W.
Copeland, which reported that many final rules were not submitted to GAO or Congress from 1999 through 2009.
66
The CRA (5 U.S.C. §805) states that “No determination, finding, action, or omission under this chapter shall be
subject to judicial review.” See Montanans For Multiple Use v. Barbouletos, 568 F.3d 225 (D.C. Cir. 2009).
67
CRS Report R41651, REINS Act: Number and Types of “Major Rules” in Recent Years, by Curtis W. Copeland and
Maeve P. Carey.
68
U.S. Department of Transportation, Federal Railroad Administration, “Positive Train Control Systems,” 75 Federal
Register 2598, January 15, 2010. “Positive train control systems” refers to technology that can prevent accidents such
as train-to-train collisions and train movements through a switch left in the wrong position.
69
Virtually all agency regulations are currently issued under informal “notice and comment” rulemaking procedures.
Formal rulemaking, as the name implies, is a much more rigorous, trial-like, on-the-record procedure in which
interested persons testify and cross-examine witnesses, and the agency may take depositions and issue subpoenas. It is
generally considered a more time-consuming and expensive process than informal rulemaking.

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export of non-defense articles or services; and (3) are limited to agency organization,
management, or personnel matters.
S. 358 also contains some new requirements on rulemaking agencies. For example, it would
require a minimum of 60 days for public comment, unless a rule is designated by OIRA as an
emergency rule. Also, if an interim final rule is issued under the APA’s “good cause” exception in
5 U.S.C. §553(b)(B) and challenged in a U.S. court, the issuing agency would be required to
delay the implementation of the rule until final disposition of the challenge.
Section 8 of the bill would put into statute, broaden, and modify the requirements for
retrospective rule review that are in Executive Order 13563. Specifically, agencies (including
independent regulatory agencies) would be required to develop and submit to the “appropriate
congressional committees” a “preliminary plan” for reviewing “significant” rules issued by the
agencies every five years to determine if they should be “modified, streamlined, expanded, or
repealed.” “Significant” regulatory actions are defined as they are in Executive Orders 12866 and
13563 (e.g., rules expected to have a $100 million impact on the economy or conflict with
another agency’s actions), but also includes regulatory actions that are expected to “add to the
national debt.” Upon completion of any such retrospective review, the agency must submit a
report to the appropriate congressional committees describing the outcome of the review. That
report is to describe which regulations were changed or repealed, the reasons for the changes, and
the reasons why no action was taken.

Analysis
Shortly after Senator Roberts introduced S. 358, he said the bill would “strengthen and codify
President Obama’s Executive Order from January 18 (Executive Order 13563),” and would
ensure that provisions in the executive order would be implemented.70 He also said that the
legislation would improve on the executive order by including independent regulatory agencies
and eliminating other “loopholes” (e.g., eliminating a provision stating that agencies may
consider values that are difficult to quantify, such as equity, human dignity, fairness, and
distributive impacts). However, S. 358 states that agencies may “take into account benefits and
costs, both quantitative and qualitative,” so agencies could arguably include equity, human
dignity, fairness, and distributive effects as “qualitative” benefits. Also, some of the standards in
both the executive order and the proposed legislation may conflict with each other. For example,
a regulatory option that imposes the “least burden on society” may not be the option that will
“maximize net benefits.” 71
Even if S. 358 is enacted, significant regulations issued by independent regulatory agencies
would not be reviewed by OIRA under the procedures currently in Section 6 of Executive Order
12866, so their regulations would not be independently analyzed for consistency with these
legislative standards. Those agencies’ rules could be made subject to review by OIRA by statute
or by the President amending Executive Order 12866. As discussed in more detail later in this
70

Senator Pat Roberts, “Regulatory Responsibility for Our Economy Act of 2011,” remarks in the Senate,
Congressional Record, daily edition, February 16, 2011, p. S766.
71
For example, one regulatory option could have estimated costs of $50 million and benefits of $100 million, yielding
net benefits of $50 million. Another regulatory option could have estimated costs of $100 million and benefits $200
million, yielding net benefits of $100 million. The first option would impose the least burden, while the second option
would produce the largest net benefits.

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report, however, doing so would put independent regulatory agencies more under the control of
the President than ever before.
The retrospective review requirements in S. 358 differ somewhat from the requirements in
Executive Order 13563. For example, whereas the executive order requires agencies to submit
their preliminary regulatory review plans to OIRA, the bill would have those plans submitted to
the appropriate congressional committees. Also, the executive order does not specify how
frequently these “periodic” reviews would occur, whereas S. 358 specifies that the reviews must
be done once every five years. Finally, it is unclear what effect the addition of a new category to
the definition of “significant regulatory actions” (i.e., actions that are expected to “add to the
national debt”) will have on the number of rules that would be retrospectively reviewed.

S. 474: the Small Business Regulatory Freedom Act of 2011
S. 474, introduced by Senator Olympia Snowe on March 3, 2011, and referred to the Senate
Committee on Homeland Security and Governmental Affairs, proposes to make several
amendments to the Regulatory Flexibility Act (RFA). Section 3 of the legislation would add a
definition of “economic impact” (at 5 U.S.C. §601(a)), defining it (in the context of a proposed or
final rule) as any direct economic effects on small entities and “any indirect economic effect on
small entities, including potential job creation or job loss, that is reasonably foreseeable and that
results from the rule, without regard to whether small entities are directly regulated by the rule.”
(For more than 25 years, courts have ruled that agencies need not prepare regulatory flexibility
analyses if the effects of a rule on an industry are indirect.72) Section 4 of the bill would amend
Section 611 of the RFA and permit judicial review of agency compliance with the initial
regulatory flexibility analysis requirements in Section 603 of the act for proposed rules.
(Currently, judicial review is not available for such analyses.) 73 Small entities must seek such
review before the close of the public comment period provided for in the proposed rule. Section 4
of S. 474 would also permit courts to issue an injunction prohibiting an agency from taking any
action relating to the rule until it is in compliance with the RFA’s requirements for initial and final
regulatory flexibility analysis.74
Section 5 of S. 474 would amend Section 610 of the RFA and require each agency to establish a
plan for the periodic review of each rule that the agency head determines has a significant
economic impact on a substantial number of small entities, “without regard to whether the agency
performed an analysis under section 604 with respect to the rule.” (At the present time, it is
unclear whether agencies must review all of their rules that currently have such impacts, or only
those rules that were expected to have such impacts at the time they were issued.) Section 5 also
requires agencies to review any small entity compliance guides that were required to be published
under Section 212 of SBREFA. Reviews of existing rules and compliance guides would be
required to be completed within eight years after the date of enactment, and every subsequent
eight years. Rules and compliance guides issued after the date of enactment would be required to
be completed within eight years “after the date the final rule is published in the Federal
72

See, for example, Mid-Tex Electric Cooperative, Inc. v. FERC, 773 F.2d 327, 343 (D.C. Cir. 1985).
Judicial review is already permitted with regard to agency compliance with sections 601, 604, 605(b), 608(b), and
610, and agency compliance with Sections 607 and 609(a) is permitted in connection with judicial review of Section
604. See 5 U.S.C. §611(a)(1).
74
Courts are already permitted to remand the rule to the agency and to defer enforcement of the rule against small
entities unless the court finds that continued enforcement of the rule is in the public interest. See 5 U.S.C. §611(a)(4).
73

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Register.” (Agencies are allowed to extend these deadlines for up to two years, if necessary.) The
proposed legislation also details the contents of those reviews and public notices of the reviews.
Six months after the deadline for review, if the SBA Chief Counsel for Advocacy determines that
an agency has failed to complete the required review, “each rule issued by the agency that the
head of the agency determined under subsection (a) has a significant economic impact on a
substantial number of small entities shall immediately cease to have effect.”
Currently, only rules issued by EPA, OSHA, and the soon-to-be-established CFPB are required to
hold SBREFA review panels before publishing a proposed rule that is expected to have a
SEISNSE. Section 6 of S. 474 would expand the requirement for review panels to all federal
agencies.
Currently, the RFA’s requirements only apply to proposed rules and final rules for which the
agency published a notice of proposed rulemaking. Section 7 of the proposed legislation would
expand the scope of the RFA to include significant guidance documents as defined in OMB’s
final bulletin for agency good guidance procedures.75
Currently, Section 603(a) of the RFA states that the chapter applies to interpretative tax rules, “but
only to the extent that such interpretative rules impose on small entities a collection of
information requirement.” The Internal Revenue Service (IRS) has asserted that the underlying
internal revenue laws, not their rules, impose the information collection requirement, and
therefore the RFA does not apply. S. 474 would amend Section 603(a) to state that the chapter
applies if the rules, “or the statutes upon which such rules are based,” impose an information
collection requirement on small entities.
The bill would also require agencies’ initial and final regulatory flexibility analyses to be more
detailed, and would require quantification of those analyses to the extent possible. It would also
require agencies to notify the SBA Office of Advocacy of any draft rules that are expected to have
a SEISNSE when the rule is submitted to OIRA for review or at least three months before
publication. Finally, the bill would establish qualifications for the Chief Counsel for Advocacy,
and would permit the office to comment on any regulatory action that affects small businesses,
without regard to whether the agency is required to file a notice of proposed rulemaking.

75
The bulletin defines a “significant” guidance document” as a guidance document disseminated to regulated entities or
the public that may reasonably be anticipated to “(1) lead to 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 Executive Order 12866.” See U.S. Office of Management and Budget, “Final Bulletin for Agency Good
Guidance Practices,” 72 Federal Register 3432, January 25, 2007, available at http://www.whitehouse.gov/sites/
default/files/omb/assets/regulatory_matters_pdf/012507_good_guidance.pdf.

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S.Amdt. 299 to S. 493, the SBIR/STTR Reauthorization Act of 2011 76
S.Amdt. 299 to S. 493, introduced by Senator Olympia Snowe on April 14, 2011, and referred to
the Senate Committee on Small Business and Entrepreneurship, is very similar to Senator
Snowe’s original bill, S. 474. Some of the differences are as follows:
•

S.Amdt. 299 defines “indirect” economic impact somewhat differently (“the
reasonably foreseeable economic effects of the rule on small entities that (i)
purchase products or services from, sell products or services to, or otherwise
conduct business with entities directly regulated by the rule; (ii) are directly
regulated by other governmental entities as a result of the rule; or (iii) are not
directly regulated by the agency as a result of the rule but are otherwise subject to
other agency regulations as a result of the rule”).

•

S.Amdt. 299 requires agencies to review their rules and compliance guides
within nine years of the date of enactment (instead of eight years in S. 474), and
every nine years thereafter. It does not allow agencies to extend the deadline if
they are unable to complete their reviews within this time period.

•

S.Amdt. 299 requires the Inspector General (IG) for the agency (not the SBA
Office of Advocacy) to determine whether the agency has conducted the required
retrospective review “appropriately” (not just whether the required reviews have
been completed). The IG is required to notify the agency of any deficiency, and if
the agency does not address the issues within six months, the IG is required to
notify Congress within 30 days. Thirty days after that notice, “an amount equal to
1 percent of the amount appropriated for the fiscal year to the appropriations
account of the agency that is used to pay salaries shall be rescinded.” (In S. 474,
the rule would go out of effect if the analysis was not conducted appropriately.)

•

Instead of subjecting all agencies to the panel requirements in Section 609 of the
RFA, S.Amdt. 299 would require the SBA Chief Counsel for Advocacy to
designate three additional agencies each year for three years “based on the
economic impact of the rules of the agency on small entities.”

S.Amdt. 299 does not establish qualifications for the Chief Counsel for Advocacy, but added an
authorization of appropriation for FY2012 through FY2013 of the costs associated with these
amendments and repeals certain statutory provisions to offset those costs.
On May 2, 2011, the Senate Majority Leader filed for cloture on S. 493, citing concerns about
“extraneous amendments” to the bill. According to press accounts, one of the primary areas of
concern was S.Amdt. 299, particularly the requirement for retroactive review.77 However, on May
4, 2011, by a vote of 52-44, cloture on the bill was not invoked.78 As of the date of this report, S.
493 has not been acted upon.

76

Among other things, S. 493 would reauthorize through FY2019 the SBA’s Small Business Innovation Research
(SBIR) and Small Business Technology Transfer (STTR) programs.
77
Dean Scott, “Snowe’s Regulatory Review Plan May Stall if Reid Shelves Small Business Bill,” BNA Daily Report
for Executives, May 4, 2011, p. A-30.
78
Record vote number 64, May 4, 2011.

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S.Amdt. 390 to S. 782, the Economic Development Revitalization Act of 201179
As discussed below, on May 19, 2011, Senator Snowe introduced S. 1030, the text of which was
identical to the text of S.Amdt. 299. On June 8, 2011, Senator Mitch McConnell introduced
S.Amdt. 390 to S. 782 for Senator Snowe. The text of S.Amdt. 390 was also identical to the text
of S.Amdt. 299. On June 9, the Senate did not approve the amendment. Among those voting
against the amendment was Senator Mary Landrieu, chair of the Senate Committee on Small
Business, who said that although she was sympathetic to the concerns addressed in the
amendment, it “reaches so far outside of the realm of small business, it seems irresponsible for us
to move forward unless it goes through the entire process.”80

Analysis
Some of the provisions in S. 474 were in proposed legislation that Senator Snowe sponsored
during the 111th Congress (S. 3103, the Small Business Job Creation Act of 2010), but which was
not enacted. Among other things, that legislation would have amended the RFA to require (1)
each initial regulatory flexibility analysis to estimate the economic impact of the proposed rule on
small businesses; (2) an agency to notify the SBA Chief Counsel for Advocacy of any draft rules
that may have a significant economic impact on a substantial number of small businesses; (3)
each final regulatory flexibility analysis to include the agency’s response to any comments filed
by the Chief Counsel in response to the proposed rule; and (4) the agency to publish the final
regulatory flexibility analysis on its website. It also would have required each agency to place on
its website its plan for the periodic review of rules.
In a press release issued when she introduced S. 474, Senator Snowe said the bill would “ensure
that federal agencies fully consider small business economic impact during the regulatory
process.”81 In that same press release, a representative of the National Federation of Independent
Businesses was quoted as saying that the bill would “help prevent the threat of costly new
regulations.” However, representatives from the Center for Progressive Reform said that S. 474
would effectively give regulatory veto power to the SBA Chief Counsel for Advocacy, and that
agencies have insufficient staff and resources to take on additional rulemaking requirements.82
To the extent that agencies are already conducting the retrospective reviews of all of their rules
that are required by Executive Order 13563, the review requirements in S. 474 (focusing only on
rules that have a SEISNSE) may be viewed as a subset of the broader requirement. However, the
retrospective reviews that would be required under S. 474 differ from the executive order’s
reviews in several other respects: (1) the S. 474 reviews are required to be completed within eight
years, and must be repeated at least every subsequent eight years; (2) the S. 474 reviews include
79
Among other things, S. 782 would encourage regional and interagency cooperation, expand the role of regional
Economic Development Districts, and modify the factors used to determine the federal share of Economic
Development Administration-funded projects and activities. For more information, see CRS Report R41162, Economic
Development Administration: Reauthorization Issues in the 112th Congress, by Eugene Boyd and Oscar R. Gonzales.
80
Press release from the Chairman of the Senate Committee on Small Business and Entrepreneurship, June 9, 2010,
available at http://sbc.senate.gov/public/index.cfm?p=PressReleases&ContentRecord_id=4dd41e1b-0054-4d9d-ae709bb3ec96ced5.
81
See http://snowe.senate.gov/public/index.cfm/pressreleases?ContentRecord_id=b871d6b2-4df2-40ac-b0966c70d403b15d&ContentType_id=ae7a6475-a01f-4da5-aa94-0a98973de620&Group_id=2643ccf9-0d03-4d09-90823807031cb84a&MonthDisplay=3&YearDisplay=2011.
82
Jonathan Riskind, “Environmental Setbacks Feared in Snowe Bill,” Portland Press Herald, March 30, 2011, p. B3.

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compliance guides, not just rules; (3) the reviews are to be overseen by an outside entity (SBA’s
Office of Advocacy or, in the case of S. Amnt. 299, the agencies’ IGs); and (4) there are
potentially severe consequences for failing to conduct the required reviews.83
Regarding those consequences, if the SBA Chief Counsel for Advocacy concludes that an agency
has “failed to complete the review” required, then “each rule issued by the agency that the head of
the agency determined under subsection (a) has a significant economic impact on a substantial
number of small entities shall immediately cease to have effect.” Arguably, therefore, if an agency
has 50 rules that the agency head concludes have a SEISNSE, and the SBA Chief Counsel for
Advocacy concludes that the agency did not “complete” the review of all of them within the eight
year period (e.g., the agency reviews only 40 of the 50 rules), then all 50 of the rules would
“cease to have effect.” The somewhat different approach outlined in S.Amdt. 299 (determinations
by the agency IGs as to whether the retrospective reviews had been done “appropriately,” with
subsequent periods for the agencies to respond to those determinations) seems less abrupt, and
may raise fewer concerns about whether one agency (SBA) can take another agency’s rules out of
effect. Nevertheless, S.Amdt. 299 does not indicate how the IGs should determine whether the
agencies’ retrospective reviews had been done “appropriately.”
The implications of including in the reviews any small entity compliance guides that are
“required to be published by the agency under section 212” of SBREFA are unclear. For example,
if an agency designated an existing compliance guide as a Section 212 guide (as GAO reported
agencies have done), then the agency arguably would not have to review the guide because it was
not “required to be published” under Section 212 of SBREFA.
The implications of expanding the RFA to include significant guidance documents are also
unclear. On one hand, this change could significantly expand the scope of the RFA, for agencies
issue thousands of guidance documents each year that are intended to clarify the requirements in
related statutes and regulations.84 Also, the OMB bulletin on guidance documents states that the
definition of a guidance document
is not limited only to written guidance materials and should not be so construed. OMB
recognizes that agencies are experimenting with offering guidance in new and innovative
formats, such as video or audio tapes, or interactive web-based software. The definition of
“guidance document” encompasses all guidance materials, regardless of format.85

On the other hand, the number of “significant” guidance documents that would be covered by S.
602 could be quite small. First, guidance documents, unlike regulations, cannot have a binding
effect on the public.86 Therefore, it is not clear how guidance can be expected to have the effects
delineated in the definition of a “significant” guidance document (e.g., “lead to an annual effect
83

In this discussion, references to S.Amdt. 299 are also applicable to S. 1030 and S.Amdt. 390, since the text of the
bills are identical.
84
For example, the Occupational Safety and Health Administration indicated in 2000 that it had issued 3,374 guidance
documents since March 1996. See U.S. Congress, House Committee on Government Reform, Non-Binding Legal
Effect of Agency Guidance Documents, 106th Cong., 2nd sess., H.Rept. 106-1009 (Washington: GPO, 2000), p. 5.
85
Office of Management and Budget, “Final Bulletin for Agency Good Guidance Practices,” p. 3434.
86
See, for example, Appalachian Power Co. v. EPA, 208 F.3d 1015 (D.C. Cir. 2000); Chamber of Commerce v.
Department of Labor, 174 F.3d 206 (D.C. Cir. 1999); Robert A. Anthony, “Interpretive Rules, Policy Statements,
Guidances, Manuals, and the Like—Should Agencies Use Them to Bind the Public?” Duke Law Journal, vol. 41
(1992), p. 1311.

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of $100 million or more” or “materially alter the budgetary impact” of entitlements or grants).
Even if an agency concludes that its guidance is “significant,” the agency may decide not to
conduct a regulatory flexibility analysis because it concludes that the guidance does not have a
“significant” economic effect on a “substantial” number of small entities.
Requiring all agencies to hold SBREFA review panels before proposing a rule that is expected to
have a SEISNSE could significantly slow down the process of issuing such rules. On the other
hand, including the views of small entities early in the rule development process may ease the
path of subsequent implementation. Expanding the requirements for such panels could also have
unexpected results. For example, when EPA was required to hold review panels for its rules, the
percentage of rules that the agency certified as not having a SEISNSE increased substantially.87
The slower expansion of the panel requirements advocated in S.Amdt. 299 (three additional
agencies per year) could allow for monitoring of those kinds of effects.

S. 602: the Clearing Unnecessary Regulatory Burdens (CURB) Act
S. 602, introduced by Senator Susan Collins on March 16, 2011, and referred to the Senate
Committee on Homeland Security and Governmental Affairs, would, if enacted, codify and
expand the cost-benefit analysis requirements that are currently in Executive Order 12866.
Specifically, the bill would generally require all agencies (including independent regulatory
agencies) to submit cost-benefit analyses to OIRA for their significant regulatory actions.88 A
“significant regulatory action” is defined in the bill as it currently is defined in Executive Order
12866: an action that is likely to result in a regulation that may
(A) have an annual effect on the economy of $100,000,000 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;
(B) create a serious inconsistency or otherwise interfere with an action taken or planned by
another agency; (C) materially alter the budgetary impact of entitlements, grants, user fees,
or loan programs or the rights and obligations of recipients thereof; or (D) raise novel legal
or policy issues arising out of legal mandates and the priorities, principles, and provisions of
this section.

The bill would require agencies to quantify regulatory benefits and costs “to the extent feasible,”
and to assess the costs and benefits “potentially effective and reasonably feasible alternatives to
the planned significant regulatory action.”

87

See U.S. General Accounting Office, Regulatory Flexibility Act: Implementation in EPA Program Offices and
Proposed Lead Rule, GAO/GGD-00-193, September 20, 2000. GAO reported that EPA certified 78% of its rules in the
two years prior to the enactment of SBREFA, and certified 96% of its rules in the two years after SBREFA was
enacted.
88
Section 2(a)(2) of S. 602 defines an “agency” as having the same meaning as Section 3502(1) of title 44, United
States Code. That provision defines an agency as “any executive department, military department, Government
corporation, Government controlled corporation, or other establishment in the executive branch of the Government
(including the Executive Office of the President), or any independent regulatory agency, but does not include - (A) the
Government Accountability Office; (B) Federal Election Commission; (C) the governments of the District of Columbia
and of the territories and possessions of the United States, and their various subdivisions; or (D) Government-owned
contractor-operated facilities, including laboratories engaged in national defense research and production activities.”

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The bill would also codify and expand some current OMB policies regarding guidance
documents.89 For example, it would require each agency (including independent regulatory
agencies) to develop or have written procedures for the approval of significant guidance
documents, and require each such guidance document to include certain elements (e.g., cite the
related statutory or regulatory provision, and not include mandatory terms such as “shall” or
“must”). Each agency would also be required to (1) maintain an electronic list (with links to the
text) of all significant guidance documents in effect, (2) allow the public to electronically submit
comments regarding such documents, and (3) publish a notice in the Federal Register and solicit
comments regarding “economically significant” guidance documents (defined as a “significant
guidance document that may reasonably be anticipated to lead to an annual effect on the economy
of $100,000,000 or more or adversely affect in a material way the economy or a sector of the
economy, except that economically significant guidance documents do not include guidance
documents on Federal expenditures and receipts”). Exceptions would be permitted when
soliciting comments is not feasible (e.g., emergencies or deadlines).
Finally, the bill would add a new section to the Regulatory Flexibility Act stating that if a small
entity so requests, a Regional Advocate of the SBA Office of Advocacy must request that an
agency reduce or waive a civil penalty if the Regional Advocate concludes that the penalty was
the result of a first-time violation of a reporting requirement, and the reduction or waiver is
consistent with conditions described in Section 223 of SBREFA.90 The agency must make a
written determination within 60 days, and the Chief Counsel for Advocacy is required to submit
an annual report to Congress on such requests and decisions.

Analysis
The cost-benefit analysis requirements in S. 602 would expand the requirements in Executive
Order 12866 in several ways. First, it would include independent regulatory agencies like the
SEC and the FCC, which are not currently covered by the analytical requirements in the order,
and which are not currently required to submit their rules and analyses for review to OIRA.
Requiring independent regulatory agencies to submit cost-benefit analyses for their significant
rules to OIRA could put them more under the control of the President than ever before—often in
direct contravention of the statutes that created them in the first place.
Second, even among agencies that are already covered by Executive Order 12866, S. 602 would
greatly expand the number of rules subject to cost-benefit analysis. Currently, these agencies are
required to prepare cost-benefit analyses only for “economically significant” rules that are
submitted to OIRA (about 100 per year). S. 602 expands this requirement to all “significant” rules
(about 650 per year). With the expansion of OIRA reviews to independent regulatory agencies
and all significant regulatory actions, it is unclear whether current OIRA staffing would be
sufficient to analyze and comment on all of these cost-benefit analyses.91
89

OMB’s current policies are in its “Final Bulletin for Agency Good Guidance Practices,” available at
http://www.whitehouse.gov/omb/memoranda/fy2007/m07-07.pdf.
90
Section 223 of SBREFA states that agencies’ penalty relief policies and programs shall contain certain conditions
and exclusions, which may include such factors as (1) requiring the small entity to correct the violation within a
reasonable period of time; (2) limiting the applicability to violations discovered through a compliance assistance or
audit program; or (3) excluding violations that pose serious health, safety, or environmental threats.
91
OIRA currently has about 50 staff members, of which about 30 do regulatory reviews and reviews of about 3,000
agency information collection requests per year.

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Notably, however, while S. 602 requires agencies to submit cost-benefit analyses for their
significant rules, it does not require the agencies to submit the rules themselves. If the bill is
enacted, OMB could amend its current procedures and require them to do so. Also, S. 602 states
that the cost-benefit analyses must be submitted “at such times specified by the Administrator.”
Therefore, the OIRA Administrator could greatly limit the effect of this requirement (e.g.,
requiring submission of the analyses after the rules have been published and taken effect).
Also, the guidance document provisions in S. 602 would include independent regulatory agencies
for the first time (they are not currently covered by the OMB bulletin on guidance documents).
Although the legislation does not require independent regulatory agencies to submit their
significant guidance documents to OIRA for review, if S. 602 is enacted, OMB could amend its
current procedures and require them to do so. Again, however, resource constraints could become
an issue if S. 602 was enacted.
The penalty relief provisions in the bill focus on first-time violations of paperwork requirements,
as does S. 128. However, whereas S. 128 would generally require agencies to provide penalty
relief for first-time violations (with some exceptions), S. 602 appears to give federal agencies
more discretion to decide whether penalty relief should be provided.

S. 817: Independent Agencies and the Unfunded Mandates Reform Act
S. 817, introduced by Senator Rob Portman on April 14, 2011, and referred to the Senate
Committee on the Budget, would, if enacted, amend the Congressional Budget and Impoundment
Control Act of 1974 (as amended by the Unfunded Mandates Reform Act (UMRA) of 1995) and
change the definition of an “agency” to include independent regulatory agencies. The bill would,
however, exempt from titles II, III, or IV of UMRA “rules that concern monetary policy proposed
or implemented by the Board of Governors of the Federal Reserve System or the Federal Open
Market Committee.”

Analysis
Legislation has been previously introduced to amend UMRA (e.g., H.R. 2255 in the 111th
Congress, and H.R. 6964 in the 110th Congress), but the scope of those bills was broader than S.
817, and they were not enacted. As noted earlier in this report, several GAO reviews have
indicated that UMRA currently covers only a small portion of the “economically significant”
rules that agencies issue. Therefore, expanding the coverage of the act to include rules issued by
independent regulatory agencies would likely increase the number of written reports that agencies
will be required to submit. However, as GAO also pointed out, there are many other reasons why
rules are not covered by UMRA, so many of the rules issued by independent regulatory agencies
may continue to be exempt from UMRA. Also, UMRA written reports cover many of the same
types of issues that are already covered by other rulemaking requirements. Therefore, even for
rules that are covered, the net effect in terms of additional information may be quite small.

S. 1030, the Freedom from Restrictive Excessive Executive Demands and
Onerous Mandates Act of 2011
S. 1030, introduced by Senator Snowe on May 19, 2011, and referred to the Senate Committee on
Homeland Security and Governmental Affairs, contained the same language as in the two
amendments previously discussed (S.Amdt. 299 to S. 493, S.Amdt. 390 to S. 782). It is similar to

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her earlier bill, S. 474, in many respects. For example, both would require agencies’ regulatory
flexibility analyses to consider indirect economic impacts, both would require more detailed
analyses, both would amend the judicial review requirements, both would require retrospective
reviews regardless of whether they were considered to have a SEISNE at the time the final rule
was published, both would include more IRS rules, and both would amend the definition of a
“rule” to include significant guidance documents. Following are some of the primary differences
between the bills:
•

S. 1030 defines “indirect” economic impact somewhat differently (“the
reasonably foreseeable economic effects of the rule on small entities that (i)
purchase products or services from, sell products or services to, or otherwise
conduct business with entities directly regulated by the rule; (ii) are directly
regulated by other governmental entities as a result of the rule; or (iii) are not
directly regulated by the agency as a result of the rule but are otherwise subject to
other agency regulations as a result of the rule”).

•

S. 1030 requires agencies to review their rules and compliance guides within nine
years of the date of enactment (instead of eight years in S. 474), and every nine
years thereafter. It does not allow agencies to extend the deadline if they are
unable to complete their reviews within this time period.

•

S. 1030 requires the inspector general (IG) for the agency (not the SBA Office of
Advocacy) to determine whether the agency has conducted the required
retrospective review “appropriately” (not just whether the required reviews have
been completed). The IG is required to notify the agency of any deficiency, and if
the agency does not address the issues within six months, the IG is required to
notify Congress within 30 days. Thirty days after that notice, “an amount equal to
1 percent of the amount appropriated for the fiscal year to the appropriations
account of the agency that is used to pay salaries shall be rescinded.” (In S. 474,
the rule would go out of effect if the analysis was not conducted appropriately.)

•

Instead of subjecting all agencies to the panel requirements in Section 609 of the
RFA, S. 1030 would require the SBA Chief Counsel for Advocacy to designate
three additional agencies each year for three years “based on the economic
impact of the rules of the agency on small entities.”

Unlike S. 474, S. 1030 does not establish qualifications for the Chief Counsel for Advocacy, but
the bill adds an authorization of appropriation for FY2012 through FY2013 of the costs
associated with these amendments and repeals certain statutory provisions to offset those costs.

Analysis
Because S. 1030 is similar in many respects to S. 474, many aspects of that analysis are also
applicable to this bill. For example, to the extent that agencies are already conducting the
retrospective reviews of all of their significant rules that are required by Executive Order 13563,
the review requirements in S. 1030 (focusing on rules that have a SEISNSE) may be a subset of
the executive order requirement. However, the retrospective reviews that would be required under
S. 1030 differ from the executive order’s reviews in several other respects: (1) the S. 1030
reviews are required to be completed within nine years, and must be repeated at least every
subsequent nine years; (2) the S. 1030 reviews include compliance guides, not just rules; (3) the
reviews are to be overseen by an outside entity (inspectors general); and (4) there are potential
consequences for failing to conduct the required reviews (loss of 1% of salary appropriation).
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Also, it is unclear what criteria the IGs would use to determine whether agency reviews have
been conducted “appropriately,” since none are specified in the bill.
Whereas S. 474 would expand the advocacy review panel requirements to all agencies, S. 1030
takes a more gradual approach, relying on recommendations from SBA’s Office of Advocacy to
add three additional agencies in each of three years. Also, although S. 1030 authorizes addition

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/crs%3AR41834. Public record. Not legal advice.