Rulemaking Procedures; Public Participation

DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 1

RIN 2900-AI33

Rulemaking Procedures; Public Participation

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.

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SUMMARY: This document amends the ``General Provisions'' regulations of

the Department of Veterans Affairs (VA) by eliminating a policy

statement concerning prior notice-and-comment for rulemaking. We

believe that there is no need to retain this policy statement.

Furthermore, this action is warranted to prevent confusion concerning

VA policy.

EFFECTIVE DATE: April 4, 1997.

FOR FURTHER INFORMATION CONTACT: Thomas O. Gessel, Director, Office of

Regulations Management (02D), Office of General Counsel, Department of

Veterans Affairs, 810 Vermont Avenue, NW, Washington, DC 20420, (202)

273-8605.

SUPPLEMENTARY INFORMATION: In a document published in the Federal

Register on March 20, 1996 (61 FR 11309), we amended the ``General

Provisions'' regulations in 38 CFR Part 1 by removing Sec. 1.12

captioned ``Public participation in regulatory development.''

Subsequently, judicial review was sought on the basis that the removal

did not comply with notice-and-comment provisions. Accordingly, to

avoid unnecessary litigation, we reestablished Sec. 1.12 in a document

published in the Federal Register on July 1, 1996 (61 FR 33850). In

addition, in a companion document also published in the Federal

Register on July 1, 1996 (61 FR 33878), we proposed to remove Sec. 1.12

and requested comments on the proposal. Accordingly, this document

relates to the proposal to remove Sec. 1.12.

The comment period ended August 30, 1996. We received four

comments. Three were submitted by veterans'' service organizations and

one was submitted by a law school professor. The commenters argued in

favor of retaining Sec. 1.12.

The provisions of the Administrative Procedure Act (APA) at 5

U.S.C. 553 set forth notice-and-comment requirements for rulemaking and

include exemptions from the notice-and-comment requirements for

rulemaking concerning public property, loans, grants, benefits, or

contracts.

The regulatory history of Sec. 1.12 indicates that this section was

established for the purpose of adopting a recommendation of the 1969

Administrative Conference of the United States, i.e., that agencies

adopt a policy stating that they would not exempt rulemaking from

notice-and-comment provisions solely because the rulemaking concerned

public property, loans, grants, benefits, or contracts (see 37 FR 3552,

February 17, 1972; 37 FR 7157, April 11, 1972).

Subsequent to the initial promulgation of Sec. 1.12, statutory

provisions were established that specifically apply the notice-and-

comment provisions of 5 U.S.C. 553 to VA rulemaking concerning loans,

grants, or benefits (see 38 U.S.C. 501(d)). Also, subsequent to the

initial promulgation of Sec. 1.12, statutory provisions were

established that specifically apply notice-and-comment

[[Page 9970]]

provisions to certain rulemaking concerning contracts (see 41 U.S.C.

418b). These statutory provisions do not impose notice-and-comment

provisions for rulemaking concerning public property.

One commenter indicated that we should retain the notice-and-

comment provisions for rulemaking concerning public property and

contracts. We are committed to compliance with all legal requirements

concerning rulemaking, including APA requirements. However, we believe

that self-imposition of any other procedures for rulemaking should be

done on a case-by-case basis and we do not believe that it is necessary

or prudent to self-impose additional requirements by regulation.

The commenters also argued in favor of retaining Sec. 1.12 based on

issues relating to certain ``non-legislative rules'' (rules of agency

management; interpretative rules; general statements of policy; rules

of organization, procedure, or practice). In this regard, the

provisions of 5 U.S.C. 553 contain exemptions from the notice-and-

comment requirements for ``non-legislative rules.'' The commenters

argued that Sec. 1.12 added notice-and-comment requirements for

rulemaking regarding such ``non-legislative rules'' and further

included specific reasons to support the desirability of having

additional notice-and-comment for such types of rulemaking.

Rulemaking documents establishing ``non-legislative rules'' are

issued by the Secretary and concurred in by the General Counsel. The

provisions of Sec. 1.12 included internal instructions which stated:

``Exceptions to the policy of permitting public participation in the

regulatory development may be authorized by the Secretary or one of the

Secretary's deputies if adequately justified and concurred in by the

General Counsel.'' The next sentence, in part, states: ``Such

exceptions, unless public comment is required by statute, may be

recommended when: (a) The proposed regulations consist of

interpretative rules, general statements of policy, or rules of

Department of Veterans Affairs organization procedure or practice * *

*.'' The mere finding that a rulemaking proceeding concerned a ``non-

legislative'' rule met the ``adequately justified'' standard for

foregoing the notice-and-comment procedures. The elimination of

Sec. 1.12 would bring VA practice into conformity with the requirements

generally imposed on the rest of government, i.e., notice-and-comment

issues would be governed by the provisions of 5 U.S.C. 553. Eliminating

the regulatory provisions imposing internal procedural steps increases

government efficiency and would not result in the diminution of the

substantive rights of any party.

Furthermore, the removal of Sec. 1.12 is warranted because it has

generated much confusion, particularly with respect to ``non-

legislative rules.'

Accordingly, based on the rationale set forth in the proposed rule

and this document, we are removing Sec. 1.12.

This rulemaking action concerns VA policy and internal VA

procedures. Although we provided notice-and-comment concerning this

rulemaking proceeding it was not required under the provisions of the

APA and, consequently, no regulatory flexibility analysis is required

under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.).

Nevertheless, the Secretary of Veterans Affairs certifies that this

rule will not have a significant economic impact on a substantial

number of small entities as they are defined in the Regulatory

Flexibility Act. This rule will not have a direct effect on small

entities.

There is no Catalog of Federal Domestic Assistance program number.

List of Subjects in 38 CFR Part 1

Administrative practice and procedure, Claims, Freedom of

information, Government contracts, Government employees, Government

property, Reporting and recordkeeping requirements.

Approved: February 24, 1997.

Jesse Brown,

Secretary of Veterans Affairs.

For the reasons set out in the preamble, 38 CFR part 1 is amended

as set forth below:

PART 1--GENERAL PROVISIONS

1. The authority citation for part 1 continues to read as follows:

Authority: 38 U.S.C. 501(a), unless otherwise noted.

Sec. 1.12 [Removed]

2. Section 1.12 and the undesignated center heading preceding

Sec. 1.12 are removed.

[FR Doc. 97-5341 Filed 3-4-97; 8:45 am]

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