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S. Hrg. 114–266 

THE UNFUNDED MANDATES REFORM ACT: 

OPPORTUNITIES FOR IMPROVEMENT TO SUPPORT 

STATE AND LOCAL GOVERNMENTS 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

REGULATORY AFFAIRS AND FEDERAL 

MANAGEMENT 

OF THE

COMMITTEE ON 

HOMELAND SECURITY AND 

GOVERNMENTAL AFFAIRS 

UNITED STATES SENATE 

ONE HUNDRED FOURTEENTH CONGRESS 

SECOND SESSION 

FEBRUARY 24, 2016 

Available via http://www.fdsys.gov 

Printed for the use of the Committee on Homeland Security 

and Governmental Affairs 

( 
(II) 

COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS 

RON JOHNSON, Wisconsin, Chairman 

JOHN MCCAIN, Arizona 

ROB PORTMAN, Ohio 

RAND PAUL, Kentucky 

JAMES LANKFORD, Oklahoma 

MICHAEL B. ENZI, Wyoming 

KELLY AYOTTE, New Hampshire 

JONI ERNST, Iowa 

BEN SASSE, Nebraska 

THOMAS R. CARPER, Delaware 

CLAIRE MCCASKILL, Missouri 

JON TESTER, Montana 

TAMMY BALDWIN, Wisconsin 

HEIDI HEITKAMP, North Dakota 

CORY A. BOOKER, New Jersey 

GARY C. PETERS, Michigan 

KEITH B. ASHDOWN, Staff Director 

GABRIELLE A. BATKIN, Minority Staff Director 

JOHN P. KILVINGTON, Minority Deputy Staff Director 

LAURA W. KILBRIDE, Chief Clerk 

BENJAMIN C. GRAZDA, Hearing Clerk 

SUBCOMMITTEE ON REGULATORY AFFAIRS AND FEDERAL 

MANAGEMENT 

JAMES LANKFORD, Oklahoma, Chairman 

JOHN MCCAIN, Arizona 

ROB PORTMAN, Ohio 

MICHAEL B. ENZI, Wyoming 

JONI ERNST, Iowa 

BEN SASSE, Nebraska 

HEIDI HEITKAMP, North Dakota 

JON TESTER, Montana 

CORY A. BOOKER, New Jersey 

GARY C. PETERS, Michigan 

JOHN CUADERESS, Staff Director 

ERIC BURSCH, Minority Staff Director 

RACHEL NITSCHE, Chief Clerk 
(III) 

C O N T E N T S 

Opening statement: Page 

Senator Lankford .............................................................................................. 1 

Senator Heitkamp ............................................................................................ 3 

Senator Portman .............................................................................................. 14 

Senator Ernst .................................................................................................... 16 

Prepared statement: 

Senator Lankford .............................................................................................. 33 

Senator Heitkamp ............................................................................................ 35 

WITNESSES 

WEDNESDAY, FEBRUARY 24, 2016 

Hon. Virginia Foxx, A Representative in Congress from the State of North 

Carolina ................................................................................................................ 4 

Hon. Curt Bramble, President Pro Tempore, Utah Senate, and President, 

National Conference of State Legislatures ........................................................ 7 

Hon. Bryan Desloge, Commissioner, Leon County, Florida and First Vice 

President, National Association of Counties ...................................................... 8 

Paul Posner, Ph.D., Director, Center on the Public Service, George Mason 

University, and Former Director of Intergovernmental Affairs, U.S. Government Accountability Office .................................................................................. 10 

Richard J. Pierce, Jr., Lyle T. Alverson, Professor of Law, George Washington 

University School of Law ..................................................................................... 12 

ALPHABETICAL LIST OF WITNESSES

Bramble, Hon. Curt: 

Testimony .......................................................................................................... 7 

Prepared statement .......................................................................................... 40 

Desloge, Hon. Bryan: 

Testimony .......................................................................................................... 8 

Prepared statement with attachment ............................................................. 46 

Foxx, Hon. Virginia: 

Testimony .......................................................................................................... 4 

Prepared statement .......................................................................................... 36 

Pierce, Richard J.: 

Testimony .......................................................................................................... 12 

Prepared statement .......................................................................................... 104 

Posner, Paul, Ph.D.: 

Testimony .......................................................................................................... 10 

Prepared statement .......................................................................................... 87 

APPENDIX 

Statement submitted from the Final Big 7 UMITA Letter .................................. 56 

National Conference of State Legislatures letter to Hon. Shelanski .................. 110 

Recommended Principles for Regulatory Reform .................................................. 112 

Responses to post-hearing questions for the Record: 

Mr. Bramble ...................................................................................................... 113 

Mr. Desloge ....................................................................................................... 119 

Mr. Posner ......................................................................................................... 125 

Mr. Pierce .......................................................................................................... 129 

(1) 

THE UNFUNDED MANDATES REFORM ACT: 

OPPORTUNITIES FOR IMPROVEMENT TO 

SUPPORT STATE AND LOCAL GOVERNMENTS 

WEDNESDAY, FEBRUARY 24, 2016 

U.S. SENATE,

SUBCOMMITTEE ON REGULATORY,

AFFAIRS AND FEDERAL MANAGEMENT,

OF THE COMMITTEE ON HOMELAND SECURITY

AND GOVERNMENTAL AFFAIRS, 

Washington, DC. 

The Subcommittee met, pursuant to notice, at 10:33 a.m., in 

room SD–342, Dirksen Senate Office Building, Hon. James 

Lankford, Chairman of the Subcommittee, presiding. 

Present: Senators Lankford, Portman, Ernst, and Heitkamp. 

OPENING STATEMENT OF SENATOR LANKFORD 

Senator LANKFORD. Good morning everyone. We meet today to 

discuss the burden Federal laws and regulations have on State and 

local governments. This is a hearing on the Unfunded Mandates 

Reform Act (UMRA) and some opportunities to be able to do some 

improvement to support it for State and local governments. 

The Unfunded Mandates Reform Act of 1995 intended to relieve 

State and local governments of many of the burdens that come 

down from the Federal Government. We will also discuss how we 

can build upon UMRA’s successes and the ways that we can address some of those. 

The Unfunded Mandates Reform Act was the result of bipartisan 

recognition that many decisions made by the Federal Government 

have significant costs, particularly to State and local governments. 

UMRA has provided better quality information to Congress and 

the agencies as we contemplate new requirements that will add 

cost burdens to local governments. But the benefits of UMRA on 

State and local governments have fallen short of their intended 

goals. 

UMRA is complex and contains many exceptions, and as a result, 

Federal actions that affect State and local governments do not benefit from the consultation and analysis required by UMRA. 

The Government Accountability Office (GAO) has found that 

issued regulations seldom trigger UMRA’s reporting and consultation requirements. There are many reasons for this. It could be because the rule was promulgated by an independent agency or the 

regulation was issued without a Notice of Proposed Rulemaking or 

perhaps the requirement in the regulation was considered vol-
2 

untary as a condition for Federal aid or the regulation did not meet 

the dollar threshold for UMRA. All of these complications allow a 

lot of opportunities for a lot of loopholes. 

Implementation of UMRA could be improved. Various experts 

also told GAO that the process used to consult with State and local 

officials needed to be more consistent and that more could be done 

to involve State and local governments in the rulemaking process. 

This goes back to a basic principle that we have, that individuals 

who are affected by a rule should actually have a voice when that 

rule is done. 

I have heard these same sentiments from several officials in 

State and local governments. The very public servants that will 

later implement a regulation are not consulted early enough to improve the regulation or are not given enough time to make the 

changes required to be in compliance. 

The provisions of UMRA require us to ask hard questions about 

the balance between our Federal Government and the governments 

closer to the people. We cannot pass the burden to them in times 

of scarce resources without due consideration. 

During my tenure in the House, we held three hearings on the 

effects of UMRA and potential improvements on the statute. I look 

forward to hearing more insights today. 

It is time to revisit UMRA. H.R. 50, The Unfunded Mandates Information and Transparency Act (UMITA), proposed by Representative Virginia Foxx—who is here as a witness to begin this hearing—and its Senate companion, S. 189, introduced by Senator 

Fischer, was conceived to strengthen the original 1995 UMRA legislation. Representative Foxx, I want to acknowledge your leadership on this issue and your tenacity on behalf of State and local 

governments, and I have been honored to work with you over the 

years on this important issue. I know this has already passed the 

House and has been a point of conversation of how do we actually 

move it through the Senate. 

UMITA improves on UMRA by reflecting much of what we have 

already learned since the original UMRA passage. It updates the 

legislation to reflect current Congressional Budget Office (CBO) 

practices, addresses current exceptions to UMRA analysis and consultation, allows for analysis of mandates to States and local governments as conditions about their grant aid, and it codifies the Office of Management and Budget (OMB) directives to agencies on 

how to consult with State and local governments in an effort to enhance consistency of these efforts. 

H.R. 50, when it passed the House in February 2015, was supported by major stakeholders representing State and local governments. I am optimistic about its prospects in the Senate, but I do 

understand full well the challenges that we face. 

I look forward to hearing from our panel today about the real 

costs of Federal decisions on State and local governments, how 

UMRA has worked, and actions that Congress could take to create 

a more thoughtful decisionmaking process about the balance between State and local governments. 

With that, I recognize Senator Heitkamp for opening remarks. 
3 

OPENING STATEMENT OF SENATOR HEITKAMP 

Senator HEITKAMP. Thank you, Chairman Lankford, and thanks 

for calling this hearing. As a former State official myself, I completely understand and appreciate, having worked with my legislature and having served in State government, the challenges that 

we face every day when we have two regulatory regimes and trying 

to make those balance and understand the impacts. And so as I 

have said before, it is critical that we examine this kind of legislation, and it is critical that we look at what has worked and what 

has not worked. And so I am grateful for this hearing. 

But we cannot lose sight that regulations are a critical part of 

how the Federal Government keeps our products safe and our food 

safe as well as ensuring a level playing field for our businesses. 

To get good regulation, we need a strong regulatory process, and 

part of that strong regulatory process is engaging stakeholders 

early. As Senator Lankford and I know, we look at these regulations, and we say we need the regulators to talk earlier with industry, labor groups, and other stakeholders when they are developing 

the rules rather than doing this in a vacuum and then presenting 

the rule as a completed effort with no real opportunity for comment. 

So I believe strongly that consultation with State and local and 

tribal governments is part of the necessary outreach that is critical 

to this regulatory process. Congress should always consider the 

compliance costs of legislation and how States and local and tribal 

governments will be impacted. Appropriate consideration must always be given to how decisions are made in Washington and how 

those decisions affect the bottom line back home. 

This analysis and consultation means we can create a safer and 

more equitable Nation without unneeded regulation but with the 

right amount of necessary regulation. And so out of this need and 

out of this discussion, Congress passed in 1995 the Unfunded Mandates Reform Act. This law has worked to keep us and the executive agencies accountable in their home States and in our communities to help ensure that those of us on the Hill understand how 

our actions affect budgets beyond our own. It requires agencies to 

consult with those individuals who have boots on the ground and 

know how those rules could be followed and what works and what 

does not. 

It is important, then, as we approach the 21st anniversary of 

President Clinton signing this bill into law that we take a step 

back and review it a retrospective review, if you will—that we 

check that our States and local partners believe that we are doing 

the right thing in terms of making sure that they have an opportunity to participate and have an opportunity to weigh in, in terms 

of those additional costs. 

And so I look forward to hearing from these witnesses today. I 

look forward to continuing this dialogue in this Committee with 

Senator Lankford and with all of the Members of the Committee 

who have worked so hard to try and achieve bipartisan solutions 

to maybe some of the more contentious issues that we have in Congress. And so I welcome the Honorable Congresswoman and look 

forward to her testimony. 

Senator LANKFORD. Thank you, Senator Heitkamp. 
4 

1The prepared statement of Hon. Foxx appears in the Appendix on page 36. 

I am glad to be able to welcome my colleague, Congresswoman 

Virginia Foxx. She has been a tenacious advocate for this, for good 

reason. This is one of those things that most people do not know 

and do not track, but it has a tremendous impact on the day-today effect of State and local governments and entities around the 

country when the Federal Government creates a new mandate and 

then expects someone else to pay for it. She has been a very clear, 

articulate spokeswoman for this process and has continued to work 

very hard in the House for its reform. So I am glad to be able to 

receive words that you need to say. I know you have to get to a 

House hearing in just a moment, so you will not be able to stay 

for the full time as well, but I am glad to be able to receive whatever statements that you would like to make about UMITA and the 

UMRA process. 

TESTIMONY OF THE HONORABLE VIRGINIA FOXX,1 A 

REPRESENTATIVE IN CONGRESS FROM THE STATE 

OF NORTH CAROLINA 

Ms. FOXX. Thank you so much, Chairman Lankford, Ranking 

Member Heitkamp, and distinguished Members of the Subcommittee. I particularly appreciate your opening comments today, 

and, Senator Heitkamp, we welcome you as a cosponsor of the bill 

with your eloquent comments. Senator Lankford, you summed up 

the bill so well. I am going to talk about some certain things today, 

but you have done a wonderful job, and I am very grateful. 

I thank all of you for the opportunity to appear before you today 

to discuss the unfunded mandates imposed on State and local governments by the Federal Government through the legislative and 

regulatory processes. Like some of you, I served as a State Senator 

and can testify to the difficulty of balancing the State’s budget 

when there are dozens of complicated unfunded Federal mandates 

that must be taken into account. Those experiences convinced me 

of the need to bring accountability to Federal regulatory structures 

that so often tie the hands of State and local governments. 

In 1995, in a model of bipartisanship, Congress passed the Unfunded Mandates Reform Act. It passed the House with close to 

400 votes and the Senate with more than 90 votes and was signed 

by President Clinton, as Senator Heitkamp has indicated. 

UMRA focused on Washington’s abuse of unfunded Federal mandates and passed on the principle that the American people would 

be better served by a government that regulates only with the best 

information. 

UMRA was designed to force the Federal Government to estimate how much its mandates would cost local and State governments, which was previously not the case. UMRA was not intended 

to prevent the government from regulating but, rather, to ensure 

that decisionmakers had the best information possible when regulating. 

I have always admired the purpose and spirit of UMRA, but 

weaknesses in the law have been exploited in the intervening decades and need to be addressed. 
5 

My bill, the Unfunded Mandates Information and Transparency 

Act, seeks to address these shortcomings and will help UMRA meet 

its unfulfilled potential. 

There are five main components to UMITA: 

First, UMITA ends the exemption that most independent regulatory agencies have from UMRA’s transparency requirements. 

These agencies include the Securities and Exchange Commission 

(SEC) , the National Labor Relations Board (NLRB), and the Federal Communications Commission (FCC). 

Second, UMITA treats ‘‘changes to conditions of grant aid’’ as 

mandates for cost disclosure purposes. If Federal legislation or regulations force States, localities, or the private sector to make costly 

changes in order to qualify for Federal grant aid, these costs will 

be included in UMRA’s cost analysis. For example, if Congress ever 

passes another law such as No Child Left Behind that changes the 

rules that States must follow to continue receiving Federal funds, 

then those changes and the resulting costs will be disclosed and 

considered. 

Third, UMITA guarantees the public always has the opportunity 

to weigh in on regulations. Currently, UMRA cost analyses are required only for regulations that were publicly announced through 

a formal Notice of Proposed Rulemaking. UMITA requires agencies 

to complete cost analyses for all regulations, whether or not such 

a notice was issued, while providing an accommodation for emergency regulations. 

Fourth, UMITA equips Congress, regulators, and the public with 

better tools to determine the true cost of regulations. Analyses required by UMITA will factor in real-world consequences such as 

costs passed on to taxpayers and opportunity costs when considering the bottom-line impact of Federal mandates. 

And, finally, UMITA ensures the Federal Government is held accountable for following these rules. 

UMRA contained little in the way of enforcement, so UMITA provides that if the transparency requirements are not met, States 

and local governments have access to a judicial remedy. 

It is in these ways that UMITA will ensure public and bureaucratic awareness about the costs in dollars and in jobs that Federal 

regulations impose on the economy and local governments. 

Let me be clear. UMITA is not an anti-regulation bill. It is intended neither to stall nor to prevent the regulatory process from 

working as it should. UMITA is a bill to make our regulatory apparatus more efficient, effective, and transparent. 

UMITA has bipartisan DNA and is purely about good government, openness, and honesty about the cost of regulations. These 

principles do not belong to either party. That is why my Democrat 

colleagues Loretta Sanchez and Collin Peterson join me as cosponsors, and it is why the bill passed the House with votes from both 

parties. 

Republicans and Democrats can agree that every unfunded mandate the Federal Government imposes should be both deliberative 

and economically defensible. It is my hope that this hearing will be 

a first step toward an improved and more transparent regulatory 

process that eases the burdens passed on to State and local governments. 
6 

Thank you for giving me this time and for your consideration of 

H.R. 50. 

Senator LANKFORD. That is great. Thank you. Representative 

Foxx, I appreciate you being here and getting a chance to walk us 

through this. 

Let us take just a short moment, and we are going to transition 

the witness table and introduce our expert witnesses that are here 

to talk about the bill today. 

[Pause.] 

At this time we will proceed with testimony from our expert witnesses. Let me introduce all four of them, and then we will swear 

you in and then get into your testimony as well. 

Senator Curtis Bramble is the president of the National Conference of State Legislatures (NCSL), a post he has held since August 2013. He is also president pro tem of the Utah State Senate, 

serving in his fourth term. He previously served as Senate majority 

leader. Thank you—you have a very busy schedule—for being here 

as well. 

Commissioner Bryan Desloge is the first vice president of the National Association of Counties (NACo). Mr. Desloge is from Florida, 

serves as the Leon County Commissioner. He is a board member 

and past president of the Florida Association of Counties. Thanks 

for being here. 

Paul Posner is the Director of the Graduate Public Administration Program at George Mason University. He has served as the 

president of the American Society for Public Administration and as 

chairman of the board of the National Academy of Public Administration. He has also served as the Director of Intergovernmental 

Affairs of the Government Accountability Office where he led the 

office’s Federal budget work. He has written extensively on UMRA 

and related topics. Thank you. 

Richard Pierce is the Lyle T. Alverson Professor of Law at 

George Washington University Law School. He is also a member of 

the Administrative Conference of the United States and has taught 

and researched in the fields of administrative law and regulatory 

practice for 38 years. 

Gentlemen, I would like to thank you for being here in front of 

us today. It is the custom of this Subcommittee that we swear in 

all witnesses before they testify, so if you would please stand and 

raise your right hand. Do you swear that the testimony you are 

about to give before this Subcommittee will be the truth, the whole 

truth, and nothing but the truth, so help you, God? 

Mr. BRAMBLE. I do. 

Mr. DESLOGE. I do. 

Mr. POSNER. I do. 

Mr. PIERCE. I do. 

Senator LANKFORD. Thank you. You may be seated. 

Let the record reflect that all the witnesses have answered in the 

affirmative. 

We are using a timing system today. You will see a countdown 

clock in front of you. Your written testimony, I appreciate you submitting that in advance. That will be a part of the permanent 

record. Whatever you say orally, you can go off of your written 

record or add to it. Either one is just fine. 
7 

1The prepared statement of Hon. Bramble appears in the Appendix on page 40. 

There is a countdown clock in front of you, and we would like to 

ask you to stay within the 5-minute time period so we can have a 

maximum amount of time for questions in the days ahead. 

Mr. Bramble, you get the privilege of being first in this based on 

your position at the table, so we are honored to be able to receive 

your testimony now. 

TESTIMONY OF THE HONORABLE CURT BRAMBLE,1 PRESIDENT PRO TEMPORE, UTAH SENATE, AND PRESIDENT, 

NATIONAL CONFERENCE OF STATE LEGISLATURES 

Mr. BRAMBLE. So this is the hot seat. Thank you, Mr. Chairman. 

Chairman Lankford, Ranking Member Heitkamp, and distinguished Members of the Subcommittee on Regulatory Affairs and 

Federal Management (RAFM), as indicated, my name is Curt 

Bramble, president of the National Conference of State Legislatures and president pro tem of the Utah Senate. I appear before 

you today on behalf of NCSL, the bipartisan organization representing the 7,383 legislators of our Nation’s States, Commonwealths, Territories, possessions, and the District of Columbia. 

Thank you for the opportunity to discuss the Unfunded Mandates Reform Act of 1995 and the opportunities for improvement to 

support State and local governments. NCSL applauds the leadership of the Committee for having this discussion, as the fiscal impact of Federal actions on State and local governments is often 

overlooked. 

Mr. Chairman, I would also like to specifically thank you, Senator Deb Fischer, a former NCSL executive committee member, 

Congresswoman Foxx, and the Ranking Member, Senator 

Heitkamp, for your leadership in seeking to strengthen the provisions of UMRA with the introduction of the Unfunded Mandates 

Information and Transparency Act of 2015. 

UMRA was adopted over 20 years ago in an effort ‘‘to curb the 

practice of imposing unfunded Federal mandates on State and local 

governments.’’ While at that time it renewed the commitment to cooperative federalism and brought attention to the growing reliance 

of mandates as a policy instrument, the law’s definition of ‘‘intergovernmental mandate’’ is limited, and as a result, the true impact 

of Federal actions on States in many cases is not reflected in the 

cost estimates. 

An example is the 1986 law called the Emergency Medical Treatment and Labor Act (EMTALA). The cost to the States of EMTALA 

and the Federal requirement of providing health care to anyone 

that presents themselves may be very good policy, but the unfunded mandate and the cost is a real challenge sometimes for 

States to meet. 

Mr. Chairman, State legislators across the country view a Federal mandate much broader than is now defined in UMRA. We 

would include situations when the Federal Government establishes 

a new condition of grant-in-aid for longstanding programs; uses fiscal sanctions to coerce States into taking some action, for example, 

in the transportation arena, if you do not do X, you may not get 
8 

1The prepared statement of Commissioner Desloge appears in the Appendix on page 46. 

Federal funding; or where it intrudes on State sovereignty. These 

just give you a few examples. 

So what is the solution? Provisions in UMITA that strengthen 

the analysis and oversight of intergovernmental mandates is a step 

in the right direction. In Utah, we actually have a Federal Funds 

Commission. We do stress testing to see what our State budget 

would look like without any Federal funds. 

In particular, NCSL supports provisions of Senate bill 189 that 

allow any Chair or Ranking Member of a Committee in the Senate 

or House of Representatives to request that CBO compare the authorized level of funding with the prospective costs of carrying out 

a condition of Federal assistance imposed on the States, local governments, or tribal governments. Changes to grant requirements 

for established State and Federal programs often result in new prescriptive requirements that shift costs to State governments. While 

statutorily these programs are deemed ‘‘voluntary,’’ in some cases 

these are State-Federal partnerships that have existed for decades. 

NCSL also supports provisions in UMITA that modify the definition of direct cost in the case of Federal intergovernmental mandates. On the regulatory side, NCSL supports the provisions of 

Senate bill 189 that expand UMRA’s reporting requirements to 

independent regulatory agencies, creates a mechanism for congressional requests for a regulatory ‘‘lookback’’ analysis of existing Federal mandates, and provides for enhanced agency consultation with 

State and local governments. 

In addition to provisions included in UMITA, NCSL would also 

encourage Congress to consider other reforms of UMRA that are 

outlined in my written testimony. 

Mr. Chairman, NCSL recognizes the need for the Federal Government to reduce its annual deficits, curb growth in the national 

debt, and achieve a sustainable fiscal path. Provisions in UMITA 

are critical to ensuring that these efforts be made with a full understanding of the fiscal impact on State and local governments. 

This is not about blocking legislative or regulatory action. This is 

about transparency and government responsibility and accountability by ensuring the full potential impacts of intergovernmental 

mandates in legislation and regulations are known. 

Mr. Chairman, thank you for this opportunity to testify before 

the Subcommittee, and I look forward to answering any questions 

the Members may have. 

Senator LANKFORD. Thank you. Mr. Desloge. 

TESTIMONY OF THE HONORABLE BRYAN DESLOGE,1 COMMISSIONER, LEON COUNTY, FLORIDA, AND FIRST VICE PRESIDENT, NATIONAL ASSOCIATION OF COUNTIES 

Mr. DESLOGE. Thank you. Thank you, Chairman Lankford, 

Ranking Member Heitkamp, and distinguished Members of the 

Committee. I am honored to testify today on how the Unfunded 

Mandates Reform Act can be improved. 

My name is Bryan Desloge. I am an elected county commissioner 

from Leon County, Florida. I am representing the National Association of Counties, which is 3,069 counties across the country. 
9 

I would like to share with you three points today to consider as 

you work to update and improve UMRA. 

First, UMRA was established as a framework for improved communication and collaboration between the Federal agencies and 

their State and local partners. The process has been helpful in raising awareness regarding unfunded mandates. However, challenges 

do exist, and the work today presents us with an opportunity to 

strengthen this. 

UMRA does require that Federal agencies consult with local governments in the regulatory process. We have found that there are 

lots of inconsistencies about how this requirement is applied. Consistency in the process and meaningful consultation in the early 

stages of rulemaking would increase awareness of the real impact 

of Federal regulations on local governments. It is important to note 

that counties are often responsible for implementing and funding 

policies and programs established by the States and Federal Government, and counties play a key role in the ultimate success of the 

process. 

It is in our shared interest that counties be engaged as partners 

throughout the entirety of these discussions and actively participate in the planning, development, and implementation of the 

rules. In current practice, we too often are limited to the comment 

period offered to the general public. One example I would like to 

highlight is the Environmental Protection Agency (EPA) and the 

U.S. Army Corps of Engineers (USACE) final rule on Waters of the 

U.S. Counties repeatedly requested to be at the table to develop a 

practical rule to protect our water resources, and, unfortunately, 

the EPA refused to meaningfully consult with local governments, 

and this lack of collaboration has resulted in a final rule that created more confusion than clarity and significantly expanded the 

EPA’s jurisdiction over county-owned and—maintained infrastructure. 

We are concerned that agencies are conducting the rulemaking 

process without truly consulting their intergovernmental partners. 

As a result, the rules are not as effective as they could be because 

they lack the informed perspective of local leaders. The bottom line 

is Federal regulations are the most effective when they are developed in consultation with State and local leaders. 

Second, if the process is not addressed, local governments will 

continue to face increasing fiscal pressure. Counties across the 

country are mandated to provide a growing number of services 

while operating under greater State and Federal restrictions on 

how we generate revenue. In fact, there are 40 States across the 

country today that limit the ability of local governments to generate revenue. In Florida, the combined fiscal impact of Federal 

and State mandates on counties is substantial. Our counties in 

Florida contributed $281 million to the local share of Medicaid 

costs this year, $57 million last year for a portion of the costs for 

juvenile secure detention, $525 million last year for court-related 

costs, and $1.8 billion in fiscal year (FY) 2013 and 2014 for county 

roads, bridges, and tunnels. 

Shifting implementation costs of Federal policies and programs 

on a local government creates budgetary imbalances, leaving local 

governments with a choice between cutting services like fire, law 
10 

1The prepared statement of Mr. Posner appears in the Appendix on page 87. 

enforcement, emergency rescue, education, and infrastructure or increasing revenue. Unfunded mandates hide from policymakers the 

true impact of Federal programs when the costs of implementing 

them is shifted on to local governments that are already stressed. 

And, finally, our system of federalism requires that there is a 

strong State, Federal, and local partnership to achieve common 

goals. At the end of the day, it is all taxpayer dollars, and where 

it goes and how it comes, we should do a better job, I think, of 

working together. 

Government works best when we all work together, and we hope 

that you will work toward creating policies that not only achieve 

our shared objectives but will also provide adequate funding to ensure that no one level is left to shoulder the burden of policy implementation. Counties stand ready with innovative approaches and 

solutions to work side by side with our Federal and State partners 

to ensure the health, well-being, and safety of our citizens. 

Mr. Chairman, we are encouraged by initiatives like the Unfunded Mandates Information and Transparency Act, that you cosponsored with Senator Fischer and that Representative Foxx led 

in the House. Although UMRA established a framework to consider 

intergovernmental mandates in legislation and regulation, UMITA 

presents the opportunity to improve the process even more. 

Thanks for the opportunity to testify. I would be happy to take 

any questions. 

Senator LANKFORD. Thank you. Mr. Posner. 

TESTIMONY OF PAUL POSNER, PH.D.,1 DIRECTOR, CENTER ON 

THE PUBLIC SERVICE, GEORGE MASON UNIVERSITY, AND 

FORMER DIRECTOR OF INTERGOVERNMENTAL AFFAIRS, 

U.S. GOVERNMENT ACCOUNTABILITY OFFICE 

Mr. POSNER. Thank you, Chairman Lankford, Ranking Member 

Heitkamp, and other Members of the Subcommittee. This hearing 

is an important stocktaking on unfunded mandates, and it will deliver much needed attention to this whole area. 

It is hard to believe, given how much we focus on this, that before the 1960s, generally Congress displayed considerable self-restraint with regard to State and local government. Major mandates 

applied to the private sector were exempted from coverage in the 

State and local sector—Social Security, fair labor standards, among 

others. Most of the national expansion that we saw with the New 

Deal and the Great Society occurred through cooperative federalism, through grants and collaboration, through the carrot not 

through the stick. 

Something changed in the late 1960s through the present day, 

and that is shown on page 4 of my testimony, the Advisory Commission on Intergovernmental Relations (ACIR) showed the rapid 

growth of preemptions through the following three decades, 

through Democratic and Republican Congresses and administrations alike. This is a bipartisan phenomenon. 

I want to just say before we talk about UMRA that there are 

very strong forces at work here that continue to this day to promote what I call the ‘‘switch from cooperative to coercive fed-
11 

eralism.’’ One is the way that Members of Congress and other national leaders get elected. It used to be there was strong collaboration with State and local party leaders. There is still that, but now 

members are increasingly on their own to develop coalitions and 

the like to campaign and get reelected for public office, sometimes 

in competition with State and local officials. 

There has been a nationalization of problems deposited on the 

Federal doorstep. Private troubles are increasingly converted to 

public problems deposited on Washington’s doorstep first, not last 

resort. Businesses have been converted from allies of States to the 

leaders of the preemption parade. 

State and local governments face extraordinary pressure defending these kinds of issues. I was at the National Governors Association (NGA) conference this week, and they said that the Every Student Succeeds Act (ESSA) was the first education bill NGA had 

been able to take a position on for 20 years, and that is true with 

most of the major legislation in Washington. The State and local 

groups have a very difficult time reaching agreement, their political 

leaders from all sides, obviously, and mandates are particularly difficult. I used to work for the mayor of the city of New York leading 

our work on Federal relations, and I know how he struggled with 

things like special education and environmental policies. It is very 

difficult to take positions against such compelling issues. 

Now, against this strong tide, I think UMRA was a modest reform that has achieved a modest result, which is not a small accomplishment by any means. I think it was cleverly designed. It 

went beyond just providing estimates and information to providing 

a point of order. And it is important to understand how that point 

of order has worked. It has been raised about 60 times in the 

House and about 3 times in the Senate since 1996. But that is not 

the way mandates are stopped. Most of those points of order did 

not stop the bills. It is through the threat of the point of order, the 

threat of shame. There is still residual concern about State and 

local costs that members often modify bills to stay under that limit 

or even withdraw them entirely, and I have several examples in my 

statement where that has been laid out. 

I think I totally agree with the other witnesses that the focus of 

UMRA has been narrow and focused on direct orders, and most of 

the mandates that really bother State and local officials happen 

through preemptions and grant conditions, particularly grant conditions. Grants, maybe widely characterized as gifts, are not a gift 

horse. They are a Trojan horse into which are packed many different requirements and particularly, as one of the witnesses said 

here, existing grants that are then piled on with retroactive conditions become particularly onerous. 

Now, the courts long agreed with the UMRA view that the only 

true mandates are direct orders. But with the Sebelius decision 

under the health reform, they now join the notion that it is not just 

direct orders that commandeer State and local resources, in the 

Court’s words. It is grant conditions that are onerous on the States, 

like the Medicaid expansion. Whatever you think of it, it was 

viewed by the Court as a mandate that was covered by constitutional issues. 
12 

1The prepared statement of Mr. Pierce appears in the Appendix on page 104. 

So I think the UMRA legislation does a lot of good things, including, I think, very sensibly extending coverage and information to 

State and local government. The consultation needs much more attention than it gets. I have suggested creating an Office of Intergovernmental Advocacy like we have Small Business Advocacy, because in the past we have learned that not only are Federal agencies uneven, but State and local governments do not pay as much 

attention as they should on their own. I think they need some help 

in that department. 

I want to say one more thing. Changes in the law, as well intentioned and as important as they are, are not going to solve the 

problem. We need to get the backing of institutions that focus on 

intergovernmental issues and federalism in this town, and unfortunately, those have largely been eliminated. In 1980, we had an Advisory Commission on Intergovernmental Relations. We had Intergovernmental Subcommittees in this Congress. OMB had a major 

division focusing on domestic grant programs and the like. Even 

the State and local groups had an Academy of State and Local government. All those have shrunk and disappeared. In some way, we 

have a barren institutional landscape to support the concerns that 

we all share, I think that you particularly share on this Committee. 

I am concerned that this dissolution of institutions reflects a 

lower priority to federalism as a rule of the game. I fear until we 

change that, nothing significant is going to happen. 

Senator LANKFORD. Mr. Pierce. 

TESTIMONY OF RICHARD J. PIERCE, JR.,1 LYLE T. ALVERSON, 

PROFESSOR OF LAW, GEORGE WASHINGTON UNIVERSITY 

SCHOOL OF LAW 

Mr. POSNER. Thank you, Chairman Lankford, Ranking Member 

Heitkamp, and the other distinguished Members of the Subcommittee on Regulatory Affairs. 

I wanted just to start by saying I agree completely with what has 

been expressed by the Chairman and the Ranking Member and the 

other witnesses. UMRA is a very important statute in its application to State, local, and tribal governments. I frankly do not have 

any idea why it applies to private regulated firms. That strikes me 

as a complete mismatch. They are the most effective participants, 

most active participants in the agency decisionmaking processes, 

and they are fully protected by the series of Executive Orders (EO) 

that began with Executive Order 11291 and continue today that 

Senator Portman knows well. He implemented them for years. This 

statute, the application of this statute to private parties seems to 

me completely duplicative, unnecessary, and counterproductive. 

But in its application, core application to county, State, and tribal 

governments, I think it is terribly important. 

Now, turning to this particular bill and the proposed changes, 

with one notable exception, I oppose them as they apply to Federal 

agencies. I am not going to take a position on how they might or 

might not improve things, and I do not have enough knowledge of 

how Congress functions, your rules of procedure, to know, to be 

able to express an informed opinion on that. 
13 

As to their application to Federal agencies, I oppose all but one 

because they are either duplicative and potentially counterproductive in their unintended adverse effects or are directly counterproductive. 

Now, let me begin with the one that I support enthusiastically, 

and that is Section 5, which would extend UMRA to independent 

regulatory agencies. I have expressed my view strongly in support 

of Senator Portman’s bill, Senate Bill 1607, on many occasions. I 

continue to support it, and really all of the same principles that I 

invoke as my basis for supporting that bill apply here equally. It 

does not matter whether it is an independent agency or, how you 

label the agency. What matters is whether the agency imposes an 

unfunded mandate on a State, local, or tribal government. And so 

I am strongly supportive of that. 

When I look at the other provisions and their potential applications to agency decisionmaking, it seems to me they fall into one 

of two categories. Many of them are just paraphrases of existing requirements, some of which are drawn from court opinions, some of 

which are drawn from Executive Orders or from other statutes. I 

always dislike legislation that attempts to reenact existing requirements using new words. What that does is create massive uncertainty for decades. Nobody knows what those words mean until 

some court decades later tells you what they mean. And in many 

cases, it comes as a shock to everyone, including the Members of 

Congress who thought they knew what this was going to do until 

they read the court opinion and said, ‘‘Oh, dear.’’ 

So I think anything that simply attempts to paraphrase something that is already an existing requirement is potentially very 

problematic and certainly unnecessary, because the requirement is 

already there. In most cases, the requirements we are talking 

about are in Executive Orders 11291, 12866, 13342, the series that 

I referred to earlier. 

Some of these provisions I oppose for other reasons. They obviously go beyond what 11291, 12866, and 13342 impose, and we already have a big problem. It is called ‘‘rulemaking ossification.’’ 

Just to give you an illustration, over the last few years Federal 

agencies have failed to comply with over 1,000 deadlines contained 

in Federal statutes about rules they are supposed to issue. Why? 

Because of rulemaking ossification. The decisionmaking procedures 

take too long, they are too resource-intensive, and the agencies 

simply cannot comply with all of those and do the job of issuing the 

rules that you have told them to issue. Plus all of these requirements apply to amendments and to rescissions as well, and there 

are lots and lots of obsolete rules that simply cannot be amended 

or repealed because of rulemaking ossification. I oppose any effort 

by you to impose more burdensome, time-consuming, costly decisionmaking procedures on Federal agencies. 

Senator LANKFORD. Thank you, Mr. Pierce. 

I would like to ask unanimous consent that we move to Senator 

Portman first. He actually has another meeting he has to get to 

quickly as well. Without objection, Senator Portman, you are up. 
14 

OPENING STATEMENT OF SENATOR PORTMAN 

Senator PORTMAN. Mr. Chairman, thank you very much, and I 

appreciate the fact that you and Senator Heitkamp are holding the 

hearing and, more importantly for today’s purposes, the way you 

conduct yourself at these hearings, including letting members ask 

questions and sometimes before you have had the opportunity to do 

so yourselves, because you are going to be here until the end, as 

Senator Heitkamp once told me, which I also like about you guys. 

So as the Republican author in the House of the Unfunded Mandates Reform Act, it is difficult to see your child be criticized. 

[Laughter.] 

But I agree with most of the criticism, and in the sense that, I 

do think it was a significant move forward. It was not easy, and 

many of you supported this at the time. And, frankly, we never 

could have gotten it done without the input from State and local 

government, which is really where the pressure was applied. It was 

part of the Contract with America. It was the first one that was 

passed into law. It was Gary Condit and I. He was the Democrat, 

former mayor, and it was also bipartisan here in the Senate. As 

you know, Senator Glenn and others helped it. So it is time after 

20 years to take a look at it and say, ‘‘OK. What worked and what 

did not work?’’ So I agree with all that. 

I do think, Professor Posner, you put your finger right on where 

this has been most effective, and it is here nobody pays much attention, which is the threat of a point of order being raised has 

changed the entire way we legislate, particularly in the House, because that point of order in the House, which was the most difficult 

piece of this, as you know—and the Rules Committee fought us on 

this consistently—has made a huge difference. Not only do you get 

now the CBO analysis we did not have before, and, we have all got 

thousands of different analyses of what the costs of these mandates 

are, but I have just got to tell you, for our State and local folks who 

are here, when you want to come up with a bill and you know you 

have to run through that gauntlet and you could be embarrassed 

on the floor of the House, trust me, it makes a difference. And it 

never gets out of committee. 

So that has been the biggest impact probably and maybe, the 

unheralded one until, Paul, you raised it this morning. So thank 

you. 

But I do think there is an opportunity to fix it. I am not on 

UMITA. I have some concerns with some aspects of it, but I think 

it is generally in the right direction. 

I also think the legislation that Senator King and I have proposed—and it was bipartisan over the last 3 or 4 years, which is 

called the Regulatory Accountability Act—also gets at some of 

these same issues. And what it says, basically, is that the agencies 

have to bring State and local shareholders in early. And I know 

both the Chair and Ranking Member agree with that, and they 

have legislation that also directly affects that. But that is in the 

Regulatory Accountability Act, and I think that is a significant improvement to the current UMRA. There have been, as was said, 60 

points of order raised, but so many that were not raised that provided that threat. 
15 

On the independent agencies, Professor Pierce has been very 

brave. He has taken some slings and arrows from some folks who 

do not want the independent agencies to be under the same rules 

or even similar rules to the executive branch agencies. Let me just 

give you a little data on this. 

In 2014, the last year for which we have the data, nine agencies 

proposed 17 major rules. These are independent agencies. Only one 

of those rules contained a full cost-benefit analysis. I can go back 

to 2013 when none of the 18 major rules did. ‘‘Major’’ is over $100 

million of impact of course. In 2012, only one of the 21. So I appreciate your standing up on this. I know you have taken some heat 

on it. But it is the right thing to do. 

And, by the way, President Obama says it is the right thing to 

do. He does not want it codified necessarily, but we ought to codify 

it, and this is something that I hope—and, again, this Subcommittee has been great on this issue. There is just this big yawning gap here of the independent agencies, and it does relate to 

what we are talking about here because they do not have to live 

by the same State and local consultation and so on. So I appreciate 

you, Professor Pierce, sticking your neck out on that one and continuing to talk about it. 

I have so many questions for you guys. Let me just ask you this, 

Professor Posner, if I could. Your testimony talks about the fact 

that OMB has guidelines for Federal agency consultation with 

State and local governments, and you talk about how UMITA 

seems to codify much of that. What do you think the benefits are 

of codifying that guidance from OMB? And how would that help in 

terms of implementing UMRA in a more effective way? 

Mr. POSNER. Yes, I think this is a tradition. Codifying executive 

rules and legislation helps give it more leverage with the agencies 

and secures its survival across administrations. The Government 

Performance Modernization Act of 2010, for example, codified a lot 

of the things that OMB had already been doing, and it made them 

kind of more a factor to deal with. 

So this is an area, I think, that needs far more attention, and 

it has some notable successes, but it also has many lapses. And the 

old Advisory Commission on Intergovernmental Relations used to 

do this on behalf of the State and locals. They collated the State 

and local comments, delivered them to Federal agencies, and tried 

to serve as a broker. 

Now, they have been eliminated, but one of the things they reported is that not only did a lot of Federal agencies never come to 

them with proposed regs, but a lot of the State and locals did not 

respond to the invitation to comment. And so that is where I wonder if we need some more proactive institution as an intermediary, 

like an Office of Advocacy, like the small business community has 

to serve as a proactive hub to bring Federal statehood organizations on proposed regulations. 

Senator PORTMAN. That is well beyond what UMITA does, 

but—— 

Mr. POSNER. That is right. 

Senator PORTMAN [continuing]. Just to establish a structure, as 

you said earlier, an institution. 
16 

Well, my time has expired. I thank the gentlemen for your testimony today and for your advocacy of this issue and the pressure 

on it. Thank you, Professor Pierce, and thank you to my colleague 

from Iowa for your forbearance. 

Senator LANKFORD. Thank you. Senator Ernst. 

OPENING STATEMENT OF SENATOR ERNST 

Senator ERNST. Thank you, Mr. Chairman, and thank you, Senator Heitkamp. 

Thank you, gentlemen, for being here today. This is an important 

discussion and one that I am very familiar with, having served at 

the county level as well as at the State level. So thank you so 

much. 

Mr. Posner, you mentioned the Help America Vote Act (HAVA), 

in your written testimony, of which I am intimately familiar with 

because, as a county auditor, I served as the Commissioner of Elections at the time that HAVA was being implemented. So this was 

given as an example of a prominent mandate that was not considered to be an unfunded mandate under UMRA, and I would like 

to visit with you about that today. 

I actually had some folks from the Iowa Association of Counties 

in my office on Monday, and they brought up this piece of legislation. Another one of the visitors that I had was a county auditor 

as well and a member of NACo. So it was good to see them. 

But although the act was well intentioned, it did place a number 

of burdens upon the small counties, the rural counties, economically challenged counties, which is where I came from, and it negatively impacted the already stretched budgets. 

As you know, through the legislation States are required to purchase new voting machines, and oftentimes the technology far outpaces what States are comfortable with and what they are able to 

purchase on a rolling basis. There is also a number of maintenance 

costs, the programming costs that are always ongoing, and it was 

always very tough for us as a small county to absorb these costs 

in our county budget. 

So if you could talk a little bit about that issue and just maybe 

what we need to do to solve those issues. 

Mr. POSNER. You obviously have a lot more experience than anybody certainly that I know, and we have done a little work in Virginia and have encountered the same issue. Basically, we took one 

of the most voluntaristic parts of our public administration system 

and imposed quite a number of requirements in a very short period 

of time. And I think for purposes of this hearing, it was not considered to be an unfunded mandate for purposes of UMRA, partly because it delivered it in the form of grants and conditions of aid. 

And I think Congress bent over backward to try to avoid having 

a large Federal agency manage this. But even with that, just the 

requirements themselves, as you say, came down in a way that 

really had a lot of unanticipated effects. And I think it is one of 

the reasons why we need to be more cognizant and more accountable when we do this up front. 

Senator ERNST. Right. 

Mr. POSNER. Exactly the same thing you are talking about. 
17 

Senator ERNST. Thank you, and I appreciate that. The issue, of 

course, grants did flow through our Secretary of State’s office because that is where elections are housed in Iowa, and then on down 

to the county level. And what happened, a number of counties 

would purchase equipment. It quickly became outdated. You move 

on to the next version and the next version and new software and 

new requirements, new accessories that are required. And, unfortunately, all of that is not funded. So the unintended consequences 

after that initial purchase of equipment, and that is just one of the 

many examples that we could push forward today. But thank you 

for that. I appreciate it. 

Mr. Desloge, you did mention Waters of the United States and, 

of course, I have been pushing that quite heavily on the expanded 

definition with a number of my Senate colleagues. I have significant concerns about the impact, and this was another issue that 

was brought up by the Association of Counties members that 

stopped in the other day. You specifically mentioned that the EPA 

did not meaningfully consult counties prior to the proposed rule. 

Can you walk me through NACo’s experience and process with the 

EPA and the Corps of Engineers? And were there any efforts by 

the folks at OIRA or OMB to work through these conflicts? 

Mr. DESLOGE. I can probably address it at about 40,000 feet. We 

tried to engage early on and lodged concerns, and the devil is in 

the details. Obviously, we are all about clean water, which is the 

pushback we always got: ‘‘You do not like clean water.’’ 

Senator ERNST. Exactly. 

Mr. DESLOGE. But there is language in there that will cripple us 

eventually, and I will give you an example in my home town. We 

have a storm going through there today. The schools are closed in 

north Florida, and a couple of inches of rain, probably. I promise 

you, the last 48 hours I have had all my public works people out 

there cleaning out storm water conveyances and making sure that 

nothing is going to flood. We have concerns that some of that we 

are going to have to stop and say, well, we need to touch base with 

the Corps and see if need to get a permit for this. So I do not have 

that kind of latitude. So there is a cost, and in this case there is 

a safety issue as well. 

We lodged complaints early on. It seemed that the Corps and the 

EPA were not in tandem on this, and we got kind of conflicting 

messages. We felt like we did not get all the information, and in 

the end we kind of felt like we got run over. And, again, the intent 

is honorable, and the whole issue here is this is, I think people 

start off with the best of intentions, but as you get further down 

the road in the implementation, we end up taking the heat. And 

it is a big one. And there are a number more like that if we are 

not careful. Ozone is another one coming in the same kind of scenario. But good question, thank you. And thank you for your county services. 

Senator ERNST. And I loved my time in county service, so thank 

you so much. And thank you, Mr. Chairman. 

Senator LANKFORD. Senator Heitkamp. 

Senator HEITKAMP. Thanks to all the panel, just very reasoned 

and measured responses, and I think a great opportunity to have 

a dialogue with all of us here. And I do not mean to hijack this 
18 

from the topic, but since I have someone from the counties and 

someone from a State legislature, I want to talk about an issue 

that I think is also critical. And maybe, Professor Posner, it goes 

to an additional issue that we could include in an intergovernmental aspect. Senator Lankford and I opened up a portal which 

said Cut—— 

Senator LANKFORD. Cut Red Tape. 

Senator HEITKAMP. Cut Red Tape. I always want to say ‘‘the red 

tape.’’ Cut Red Tape. And we invited criticism and, we invited people to tell us what is working, what is not working. A lot of criticism that we got was of State regulation. It was of local regulation. 

It was about duplication between Federal regulation and State and 

local regulation. And that adds to the burden, it adds to the confusion, and it certainly adds to the costs of achieving a public purpose 

that we are all trying to move toward. 

Now, this is a situation where a fair application of the Tenth 

Amendment, you can say, ‘‘Well, if the States are regulating, the 

Federal Government ought to think twice about whether they 

ought to do it.’’ I am a big Tenth Amendment person. I hate preemption and—because I think these are the laboratories of democracy, which are State governments. 

So when you were talking, Commissioner, about the regulation, 

a lot of what you talked about on consultation involved not Federal 

mandates, but mandates coming from State legislatures and from 

executive agencies. 

My question is really to the Senator: Do you know of any model 

legislation that States have adopted on unfunded mandates that 

deal with just State regulation and pushback from counties and cities, from townships, from local government, that really can help us 

inform a model beyond the model that we are working with here? 

Mr. BRAMBLE. Thank you for the question. One of the challenges, 

with the premise of the question is that there is a different relationship between the Federal Government and the States than 

there is between State governments and the political subdivisions 

within the State. The vast majority of States—there are a few 

States that have a home rule difference, but the vast majority of 

the States, the political subdivisions—the cities, the counties, the 

towns, school districts, all of those special service districts, et 

cetera—derive their sole authority from State statute. And so the 

comparison saying, well, doesn’t the same problem exist in the 

States, where if the State legislature tells its political subdivisions 

what they should do and they do not provide funding, is not analogous to the Federal Government. 

Well, Madison in Federalist No. 45 had something to say about 

that. Talking about the proposed Constitution, he said, ‘‘The powers delegated by the proposed Constitution to the Federal Government are few and defined. Those which remain in the State governments are numerous and indefinite.’’ 

Senator HAITKAMP. I get all that, and I do truly understand the 

Tenth Amendment and the Eleventh Amendment. But my point 

is—and it is not to say we do not have an obligation here to look 

and see what the Federal-State relationship ought to be. But as I 

have pointed out frequently—and I think if I were a county commissioner who had my limitations on my property taxes restricted 
19 

by State legislature, only to receive a mandate on my share of the 

Medicaid expenditure, I might take issue with that relationship. I 

see my commissioner laughing a little bit. And I do not mean to 

cause a fight between local and State government, but I have been 

in State government long enough to know that that tension exists. 

What I am trying to get at is, we looked very closely at what 

other models there might be, whether they are international or 

whether they are, within our system itself, on how we could do a 

better job coordinating between all the levels and all the branches 

of government. And so for me, this issue is bigger than just Federal 

unfunded mandates. It is how do we work together on a layered 

basis to actually achieve results. 

And I want to go to Waters of the United States. We have been 

litigating Waters of the United States for, what, 30 years? We have 

been arguing about what is jurisdictional waters under EPA. It is 

time that Congress do its job and legislate what waters are, to create the lane, because without Congress legislating, they are going 

to be wandering around out there in my wetlands, in my potholes, 

for the rest of my life. 

And so, we can deal with the stay that we have now. I have legislation. I know it has been endorsed by both the organizations. I 

really appreciate the support. But I want to get to Professor 

Posner’s idea about some kind of more institutional framework for 

dialogue and consultation, because I agree with you, I do not believe there is enough consultation on the front end. I think that is 

true not only for State and local governments; we believe it is true 

for stakeholders as well. And so we have a bill headed up by Senator Lankford to require additional, notice before rulemaking begins so that we can get comments earlier. 

I begged EPA to reissue the rule, Waters of the United States. 

They said they did enough consultation. I do not agree. I do not 

think the courts of the United States agreed either. And so here 

we are once again creating this great uncertainty when maybe that 

could have been avoided with an institution that was greater dialogue on the front end. And we are not here to litigate individual 

legislation. We are here to talk about how we can structure the relationship in a way that it actually gets rid of the conflict and 

achieves the result. 

And so I know if I talk to my colleagues about creating yet another intergovernmental agency or another agency, the groans will 

come up. You heard it, right? You heard the groan. But, I am curious how you react to the groan and what persuasive argument you 

can make for your idea. 

Mr. POSNER. Look at all the major Federal systems in the world 

and in the Organisation for Economic Co-operation and Development (OECD). We are the only ones without a real extensive consultation mechanism. Germany, Australia, Canada have very extensive consultations that—— 

Senator HEITKAMP. And very robust subnational involvement. 

Mr. POSNER. Exactly. And staff. They staff it, too. So it is not just 

an honorific kind of an issue. 

I think these kind of things obviously take a lot of work, but I 

think one of the things that happens sometimes in our system that 

you alluded to is we focus on these different titles—Title 1, Title 
20 

2 of UMRA. Sometimes Congress sets up the agencies to have difficult problems because they do not adequately consider the impact 

of legislation on State and local government. 

Senator HEITKAMP. Right. 

Mr. POSNER. I think about the REAL ID Act of 2005 where, basically the State motor vehicle administrators have worked a bill 

that Congress approved that was going to use regulatory negotiation with the Department of Transportation (DOT) to work out a 

national ID—I will call it a national driver’s license—that was 

hardened. And then Congress literally 3 or 4 months after that imposes REAL ID with much more stringent requirements and no 

consultation at all with the State and local community and transfers it to DHS, and then they wonder why it has taken 10 years 

to implement it with all the State pushback. 

So I think a lot of this consultation—if we had done something 

before Congress even approached that through some kind of intergovernmental process, I think we might have been better off in the 

long run. That is the idea. 

Senator HEITKAMP. Professor Pierce, you said one of the things 

that you are concerned about is we are not currently meeting deadlines in terms of regulation. And I could give a concrete example 

where failure to regulate actually had tremendous costs, and that 

is in the tank car regulation that DOT just did. They waited too 

long. The industry went ahead and built a new generation of tank 

cars. All of those tank cars that just rolled off the factory line now 

have to be retrofitted to meet the guidelines. I am not saying that 

was the wrong answer. I am just saying failure to engage and regulate actually costs money. So we need to remember that regulation 

many times can be clarifying for industry and can achieve a result. 

So what is your response to a commission that would be charged 

with managing this relationship? 

Mr. PIERCE. Let me just start by expressing my complete agreement with you and with Professor Posner that I think this is the 

core problem, and it is just difficult, really difficult for a lot of reasons. 

First, the issues, the substantive issues we are addressing here 

divide everyone. The Supreme Court, Waters of the United 

States—I teach that case every year. The Supreme Court divided 

4–1–4. There were not five Justices in support of anything. There 

were two Justices, each of whom ‘‘was on a different side’’—the 

Chief Justice and Justice Breyer—who said, ‘‘You have to make a 

rule, get together and make a rule. Get a rule together, and we will 

support it.’’ 

Well, I was not sure I believed them when they said that, but 

a decade later we have a rule and, predictably, no one likes it. 

When you try to get 50 States to agree today on anything important, that is not going to happen. Right now in the context of climate change, the initial judicial action of the Supreme Court was 

instigated by a State, and now the reaction is 28 other States oppose. So nothing—— 

Senator HEITKAMP. I think people forget that. 

Mr. PIERCE [continuing]. Is going to produce agreement among 

the States. 
21 

Senator HEITKAMP. Let us go back to the question, which is finding some kind of institutional place for this dialog. Do you believe 

that that would assist in at least getting early indication of those 

conflicts? 

Mr. PIERCE. I do not know, because the next problem is each 

State has its own unique governmental structure, and I have tried 

to help Federal agencies who in good faith have tried to go out in 

consultation, and they discover not only do the States differ with 

one another, they differ within. And one State institution, the Governor’s office, will say, ‘‘Our position is X,’’ and another State institution says, ‘‘We are the ones who control this, and our position is 

Y and not X.’’ 

So trying to figure out with whom you consult, and then the result when you wind up tallying votes after a lengthy consultation 

process and conclude that 23 States are on one side, 23 States are 

on the other—— 

Senator HEITKAMP. Now you are just depressing me, so—— 

Mr. PIERCE. And the others disagree internally on what should 

be done. I do not have an answer to the problem. I agree completely that is the problem. [Laughter.] 

Senator HEITKAMP. Thank you. 

Mr. POSNER. Could I just maybe turn one light bulb on, as dim 

as it is? There have been some examples. The Federal Government 

was threatening to take over the property casualty insurance business from the States under Gramm-Leach-Bliley, and that prompted the States to get together and do their own voluntary codes, 

which, significantly helped, at least in some people’s minds, the 

State of play in the States. 

The other one, which you are familiar with, is a simplified sales 

tax initiative which 25 States bought into, which has been a real 

help. 

Now, you are right. It is not all of them. We have some significant States that are outliers, but that provides a foundation, and 

they said it could not be done. 

Senator HEITKAMP. We can go back to the Uniform Commercial 

Code, which is a great example of State cooperation to avoid a Federal commercial code. I appreciate and understand, having come 

from State government, having refereed these dialogues as the Attorney General (AG). But I am looking for systemic reforms that, 

No. 1, we can sell to our colleagues, because our really good ideas 

are having a hard time. Right, James? 

Senator LANKFORD. Though they are really good ideas. 

Senator HEITKAMP. Really good ideas. We really like our ideas, 

and they are having a hard time. And so we need to be as persuasive as we can and get consensus on our ideas. 

Senator LANKFORD. And it is the grand challenge, because when 

you talk about regulations, immediately there is a whole group— 

going back to your statement, Mr. Pierce, it is this one whole group 

that says, ‘‘Oh, my gosh, we need to not do more regulations, not 

make this more difficult,’’ and another group that says, ‘‘It is already incredibly difficult. We cannot fix it unless we streamline it 

and work our way through the process on it.’’ 

I am interested—Senator Bramble, your comment earlier about— 

let me see if I can get this term right—a Federal stress test in 
22 

Utah that you are trying to evaluate the cost of—Federal dollars 

that are coming to it, what that actually costs the State, and I am 

assuming—is it worth it based on the mandates, or as Professor 

Posner had mentioned before, the Trojan horse coming to you of 

the grant with the requirements in the back of it? Is that what that 

is? Tell me a little bit more about that. 

Mr. BRAMBLE. We have what is called a Federal Funds Commission, and one of the concerns that we have at the State level is you 

have the State budget that we control, and then you have all of the 

Federal programs that come into the State. And for most States, 

the Federal moneys dwarf the State budget. 

Senator LANKFORD. Right. 

Mr. BRAMBLE. And so the challenge for the States, if you look at 

what has happened during the economic downturn from 2009 forward, what happens when Federal funds are not there, in the West 

payment in lieu of taxes is a major issue for our States. That is 

the equivalent of property taxes. When a State like mine has 

roughly 70 percent—it is actually about 68 percent of the land 

mass owned and controlled by the Federal Government, and the 

payment in lieu of taxes (PILT), is not in the Federal budget, what 

does that do to the State? And that triggered us to take a look not 

just at that one issue, but across the board, what would our State 

budget look like, what would our financial affairs look like with a 

reduction in Federal funding across the board in all the programs? 

And the street test—— 

Senator LANKFORD. Right, which is entirely likely. So let me ask 

this: Have you been able to determine, for instance—I am just 

going to pick a program: education. Most States, education dollars 

coming to their State, between 8 and 10 to 12 percent of the dollars 

for education are Federal dollars that are coming in. Have you 

been able to determine, if we said no to those Federal dollars, what 

the cost would be and what the difference would be and how do you 

actually measure that? 

Mr. BRAMBLE. On education in our State it is a little over 7 percent of the total education budget comes from the Federal Government, and we actually have a plan that we could implement if 

those funds were no longer available. The issue is: How would the 

State continue to maintain government services, maintain its role 

without the Federal funds? And it was more than just an idle curiosity because of the challenges that the Federal Government has 

with debt, deficit, those kinds of things. It seemed to be the responsible thing to do at the State level to look and say what would the 

impact be. 

Senator LANKFORD. So then the question, have you been able to 

determine what you spend a year on education just fulfilling Federal mandates and how that lines up with the dollars that are actually coming into the States? 

Mr. BRAMBLE. We have but I do not know what that number is. 

Senator LANKFORD. That is fine. The reason I ask is this has 

been an interesting conversation among multiple States trying to 

determine, as now, as you mentioned before the Trojan horse coming to you and saying, ‘‘Here is a grant, here is an opportunity for 

you to be a partner. We will give you additional Federal dollars if 

you do this.’’ There are some States that have asked the question, 
23 

I am spending more, I think, fulfilling the Federal mandate than 

the Federal dollars actually coming in for this. But most States do 

not have the resources or the process in place to be able to actually 

answer that question. They think that is true, but they have never 

had the opportunity to be able to actually evaluate it. 

If you all have developed a method to be able to measure that, 

that is something multiple other States would be interested in and 

maybe something that would be of great benefit to many States, if 

that makes sense. 

Mr. BRAMBLE. That is actually part of the process of what we call 

our Federal Funds Commission. What is the cost of the unfunded 

mandates? What are the costs of the Federal programs? 

Senator Heitkamp, if I could go back to your question about between the State and the locals, I will put on my hat as a Utah Senator rather than president of NCSL to answer that. In our State 

we have an administrative rules committee. We pass legislation, 

and then we authorize the Executive Branch to promulgate rules 

to implement. When those rules are being drafted, when there are 

prospective rules, they go before the administrative rules committee, and we take input from the stakeholders. And that may be 

the Utah League of Cities and Towns. It may be the Utah Association of Counties. It may be the Association of Special Service Districts. It may be stakeholders across the spectrum. And whether 

that rule gets implemented, modified, or put on hold is a direct 

function of that input. And then for rules that are already in place, 

we guard jealously the legislative prerogative of setting policy, and 

we expect the Executive Branch to carry out that policy. 

We just had an example that demonstrates that: ultra-low NOx 

water heaters. We have a problem with our air quality in Utah because of mountain valleys and inversions. There is broad-based 

support for a requirement that all water heaters, new water heaters sold in the State should be these low nitrogen—ultra-low NOx. 

Our Department of Environmental Quality issued a rule that required that. It went to the administrative rules committee, and 

that rule is being repealed in favor of the legislature. There is a 

bill before the legislature—we adjourn March 10, but there is a bill 

that is being heard today, as a matter of fact, dealing with that requirement. And while we repealed the administrative rule because 

we did not believe the department had the authority, the legislature is now debating what that authority should be, because at the 

State level we guard that jealously. We do have a process for the 

local political subdivisions to weigh in both during the promulgating of the rule and after the implementation of the rule. 

Senator HEITKAMP. Yes, we have the same kind of rules committee in North Dakota. I think that can be a fairly common model. 

I have to issue my apologies. I have to run off and give a floor 

speech. But this has been very enlightening, and I know we will 

continue the dialogue. I am sorry. 

Senator LANKFORD. That is great. I am going to talk about retrospective review while you are gone, then. I will stick with some of 

your favorite subjects. [Laughter.] 

Let me bring that up because this is a big deal for Senator 

Heitkamp and me both to deal with retrospective review, and it is 

one of the challenges that we seldom get information. Once an esti-
24 

mate is made by CBO and they say this is going to cost $95 million 

or $150 million dollars to the economy—whatever the number may 

be—we are now 5 years past, it is fully implemented, it is rolled 

out. No one ever goes back to ask the question, ‘‘Was that correct 

and is that regulation working as effectively as we thought? ’’ 

So one of the areas I know are in Representative Foxx’s bill deal 

with this idea of a lookback from a Committee, for a Committee 

Chairman or Ranking Member to be able to make the request and 

say let us go back and revisit that regulation. Did it meet the target costs that we expected? And is it accomplishing what it said it 

was going to accomplish? The logical question is: If it is not working or if it is costing 10 times as much, maybe there needs to be 

a change in the statute or maybe it needs to be revisited in the regulation. 

Comments on that from anyone on the process? Because that is 

a major part. Mr. Desloge. 

Mr. DESLOGE. Yes, I do not think you are going to want to do 

that for everything, but if you said, when State and local governments stepped in and said, ‘‘This is not working for us, your estimates are way off,’’ that could trigger that. I think you would put 

an onerous kind of burden if you tried to do it on every piece of 

regulation that came down the pike. But, yes, it would give us, at 

least at a local level, a chance to argue our case and say, ‘‘Hey, this 

really did not turn out the way we thought it would.’’ And I think 

that would be beneficial for us. 

Senator LANKFORD. OK. Mr. Pierce. 

Mr. PIERCE. I certainly agree with you completely that retrospective review is a very important function, and I am sure you know, 

each of the last three Presidents has issued an Executive Order 

that requires every Executive Branch agency to engage in that 

process. 

Senator LANKFORD. But do they? 

Mr. PIERCE. No, because they do not have the resources because 

of rulemaking ossification, because it takes too many resources to 

perform that function at the same time they are unsuccessfully attempting to issue the rules that you say have to be issued, amend 

the rules that need to be amended. They simply do not have the 

resources to perform those functions, and the particular mechanism 

in this piece of legislation raises very serious constitutional questions under a series of Supreme Court opinions in which the Court 

has basically said the task of Congress is to legislate. And when 

a Member or even a Committee of Congress gets into the business 

of directing a Federal agency to do something, it at least raises serious questions of constitutionality. 

Senator LANKFORD. So the basic oversight role of Congress is also 

there, and that has been supported by multiple Supreme Court 

cases as well, that any committee could reach into an agency, as 

this Committee has done multiple times, and say, ‘‘Here is a list 

of questions, and we need information and facts.’’ And that agency 

then provides us the facts and the details. This type of retrospective review asks the question: ‘‘This is the estimate that you made 

as an agency 5 years ago. Did it prove to be correct?’’ That is an 

oversight role. If an agency gave an estimate that was far out of 

bounds, we would want to know why and how can we change that 
25 

process so that we get a more accurate look at it or to be able to 

evaluate the fact that you created a regulation in hopes that it 

would do XYZ, it did not, it did ABC instead. I think that is a fair 

part of oversight. 

Mr. PIERCE. I agree with that. I would just go back to they do 

not have anything like the resources necessary to—that is a very 

difficult task. 

Senator LANKFORD. Yes, sir. 

Mr. PIERCE. And it takes a lot more than the resources they now 

have to do it. 

Senator LANKFORD. All right. Mr. Posner. 

Mr. POSNER. This reminds me a little bit of something that Senator Portman, when he was head of OMB, did under the Bush Administration called Program Assessment Rating Tool. They tried to 

review every one of the 1,500 programs in the Federal budget, 300 

every year. It was far too much. It beat everybody up. Nobody 

could pay attention to it. 

I certainly support the retrospective process. I think you might 

want to organize it more on a priority basis, as was suggested, 

maybe by a portfolio. So maybe one year you look at all agencies 

regulating food safety and you do a regulatory lookback on them 

and kind of a reassessment of how well all 19 agencies are doing 

inspecting food, for example. That might be a way to rationalize 

that process and avoid some of the problems that we were just discussing. 

Senator LANKFORD. For Senator Heitkamp and me, one of the 

things that we have proposed is for major rules, as they go out the 

door, that there is a scheduled time for retrospective review and no 

longer than 10 years, and so that everyone knows when the rule 

is finalized, we also know exactly what year it will be reviewed, 

and every 10 years it is reviewed. And it could be 5, it could be 

10, it could be 7. The agency sets that time period—it is a predictable time period—to be able to have some review, and so, again, 

they can budget for it, they can schedule it, and they know when 

it is coming. 

We have talked a lot about the impacts on State and local governments and, for the Unfunded Mandates Reform Act when it was 

passed, the loopholes that are in it, areas where it did not trigger 

this type of disclosure, which, as you have all mentioned, is informational basically to Congress, so that Congress, when they are 

making a decision, they can have good information. Those loopholes 

that are out there, can anyone identify any particular bills or conversations that have happened where one of these unfunded mandates got through and it did not trigger some of the review? Senator Bramble? 

Mr. BRAMBLE. Yes, I have a couple of them. One general problem 

is that the UMRA criteria starts from the basis that if it is already 

an unfunded mandate, then it is only the incremental change that 

would be subject to the criteria of fitting whether there is additional review. But two specific examples: 

One is the Individuals with Disabilities Education Act. The Federal Government did not maintain its commitment to fund 40 percent average per pupil expenditure. The mandate continued. It did 

not trigger UMRA because it was in place already, and the fact is 
26 

that the Federal Government is not adequately funding it but the 

requirements are still there, and States still have to comply with 

the act. 

For the REAL ID Act, we have the same kind of situation, and 

I think that it provides an example of one of the loopholes where, 

if it is a mandate that is a funded mandate, when the funding dries 

up, there is no triggering UMRA in those cases. 

Senator LANKFORD. OK. Let me ask the where and who question. 

Dr. Posner, you had mentioned before about trying to do this intergovernmental process. That begs the question of where does that 

land best that it is most effective. You had mentioned outside 

groups that had done that here in this town and tried to raise that 

information to all bodies. The White House, the Congress, different 

groups have been out there. Where is the place that it would be 

most effective to make sure if we are going to have intergovernmental conversations it actually has impact? Is that in OMB’s 

area? Is that here in Congress? Where is that? 

Mr. POSNER. Well, the one that was eliminated in 1995 was an 

independent commission appointed by the President and approved 

by the Congress, which included 30 Cabinet Secretaries, State legislators, county board supervisors, mayors, and Governors. And I 

think that had a formative role on certain areas—general revenue 

sharing formation, the Reagan federalism program, and several 

others. I think that may be a good place for it. 

I think they also need to be populated in the various policymaking circles. So Congress had a Subcommittee on Intergovernmental Relations in both the House and the Senate that worked 

with the ACIR on issues, so that is the way things get done. As 

we know, it is not just one hand clapping. 

And so I think that is what we are missing, is that population 

of the intergovernmental perspective, in both the Congress and the 

executive at the very least. 

Senator LANKFORD. OK. Senator Bramble. 

Mr. BRAMBLE. Mr. Chairman, this is a document, Congressional 

Budget Office cost estimate, on H.R. 3821 dated February 11, 2016. 

Let me read from it: ‘‘For large entitlement programs like Medicaid, UMRA defines an increase in the stringency of conditions or 

a cap on Federal funding as an intergovernmental mandate if the 

affected governments lack authority to offset those costs while continuing to provide required services.’’ 

And then it goes on to say, ‘‘Because States have flexibility within the Medicaid program to offset their financial and programmatic 

responsibilities in order to reduce costs, CBO concludes that the 

new conditions or resulting costs would not constitute an intergovernmental mandate.’’ 

Medicaid is the second largest expenditure in the State of Utah, 

second only to education, and most States find that. And yet Medicaid itself does not trigger UMRA, and changes to Medicaid do not 

trigger UMRA. Under the Affordable Care Act, the Medicaid expansion, the 90/10 split—our State is one of 16 or 17 that have not expanded Medicaid. But that major Federal mandate in health care 

does not even trigger the UMRA criteria. 

Senator LANKFORD. Mr. Desloge. 
27 

Mr. DESLOGE. And I will take it a step further, because what 

happens is at the State level, when they are dealing with the Medicaid issues, in Florida at least, they offset and the county level 

picks up a percentage of that. And it is debated all the time in the 

courts as far as how they get to the percentage, and it has been 

a battle between the State government and us on an ongoing basis. 

We ran up a half a billion dollar backlog of disputed bills. You have 

people moving in and out of the State. And so, we are not a Medicaid provider, yet the State had figured out that they were going 

to ask us to shoulder part of it. 

So I hate to say it, but it flows downhill, and we are kind of 

where the buck stops in local government. And we want a seat at 

the table, and I commend you for this. I think this is a great tuneup of existing legislation. And we would just like the opportunity 

to be there early and be there throughout the process, and we do 

not think we will add any regulatory or additional burden. But I 

think you are spot on with where you are heading with this. 

Senator LANKFORD. OK. Dr. Posner, can you talk about your Trojan horse conversation earlier about grant conditions and such? 

You said some of those are coming much later. You take the grant 

money, and then suddenly you find out after the fact here is what 

that means. 

Mr. POSNER. Yes, on Medicaid requirements that are imposed 

after the fact. There is actually a Pennhurst decision that Justice 

Rehnquist authored that was about the Vocational Rehabilitation 

Act, which at the time was a billion-dollar-a-year program. Long 

after the States had become partners in managing this program, 

the Federal Government imposed additional requirements. And the 

Court ruled that was unconstitutional. It was a retroactive rule 

that burdened the States. 

Increasingly, it seems that major Federal grant programs like 

highways or education are vulnerable to having new Federal conditions imposed. For example, when Congress decides to slap on the 

21-year-old drinking age and a 55-mile-an-hour speed limit and 

drunk driving tolerance levels, you wonder whether the purpose of 

Congress is to fund the substantive activity or to use it as a vehicle 

for delivery of regulatory mandates. And, increasingly, it seems 

more like the latter. 

So those are the kinds of things we are talking about where, 

since 1956, we have had a cooperative relationship financially 

where the Federal Government collects the gas tax and redistributes it, but with now this overlay of regulatory mandates that have 

largely maybe overtaken the point of the program. 

Senator LANKFORD. OK. Let me read a quote to you. This comes 

from—and this has been an ongoing, long-term conversation about 

this bill and about any other changes to unfunded mandates reform. When I was serving in the House, Susan Dudley came and 

testified early on before this piece of legislation was even written, 

and we were talking about just the problems of the Unfunded Mandates Reform Act. In 2011, to one of my questions, she answered 

this—or she made this statement: ‘‘To broaden the coverage, Congress could consider aligning UMRA language with that of Executive Order 12866’’ your comment before—‘‘and/or extending it to include independent regulatory agencies, which are not currently 
28 

bound by the Executive Order either. To make the Executive 

Branch more accountable for the goals of UMRA, Congress could 

provide OMB oversight authority beyond certifying and reporting 

on agencies’ actions. Congress might also want to expand judicial 

review under UMRA so that, for example, an agency’s failure to 

justify not selecting the most cost-effective or least burdensome alternatives could be grounds for staying or invalidating the rule.’’ 

Mr. Pierce, you had made a comment about that earlier, that you 

had some concerns in that area of, again, ossification and making 

this much more difficult, as you had mentioned before. It is extremely helpful in many areas if you know that there is a way to 

be able to restrain an agency to say if you do not follow the rules, 

as with the Clean Air Act and Clean Water Act, outside entities 

can step in and say, no, you have to actually follow the rule itself 

and the guidelines. 

What is the barrier if, when the Federal Government is promulgating a rule, they do not consult, they do not engage as they are 

asked to do, States and counties can step in and say at least you 

have to consult us, slow down the process? The judicial review 

being the stick, I guess, that the States could use to be able to say 

you did not consult us. 

Mr. PIERCE. Yes, let me try that one. Let me start by saying that 

Susan is a colleague and a good friend, and I agree with her on 

most everything, including the desirability of trying to make 12866 

and whatever you folks do with UMRA fit together nicely. 

Senator LANKFORD. And that is a lot of the conversation of codifying this. We have done it now for two decades. Let us go ahead 

and make it the standard, because each administration says that 

is the Executive Order. But they also know, ‘‘OK, if we are busy, 

we are not going to follow it because it is not really statute. We 

will generally follow it, but at times we will not.’’ 

Mr. PIERCE. Once you get the courts involved, you are really 

unleashing something over which neither you nor the Executive 

Branch have any control at all. And I have no idea what they 

would do with that, and in many circumstances it has unintended 

adverse effects far worse than the intended beneficial effects. And 

that comes back to why I am concerned about efforts to codify provisions of 12866, for instance, where, sure, a new President could 

change it, but we have had a string of Presidents of both parties 

who have said, ‘‘We like it,’’ and have kept it the way it is and kept 

the courts out of it, which to me is one of the strengths they implemented. And that allows them to sit down and talk with agencies 

and have a dialogue with Federal agencies and tell a Federal agency, ‘‘I want you to go talk to the folks in Utah,’’ or the folks wherever. 

Senator LANKFORD. Right. 

Mr. PIERCE. Courts cannot do that. Courts are blunderbusses 

that come in 5 years after the fact and say, ‘‘It was all wrong. Start 

all over.’’ I do not like that. 

Senator LANKFORD. No, and I would agree. But when you can get 

some clarification, once the courts have gone through the painful 

process of multiple years and you get a clarification and everyone 

agrees on this is really the process, or Congress comes back and 

says, ‘‘That is not what we intended. We are going to fix it and pro-
29 

vide some clarity to it.’’ The key aspect is right now with 12866 

there may be consultation, but it may not be in a way that people 

felt like they were consulted. I have had several agencies that a 

rule would come out, and I would say, ‘‘Did you consult anyone on 

this?’’ And they would say, ‘‘Yes.’’ And I would say, ‘‘Who?’’ They 

would say, ‘‘Well, we have a group that we work with and consult.’’ 

‘‘Well, how was the process done?’’ ‘‘We do consultation.’’ ‘‘With 

who?’’ ‘‘This group that we consult.’’ ‘‘Who is on the list?’’ ‘‘Well, we 

do not really put their names out.’’ 

OK. Well, the people that were affected by it never felt like they 

had a voice to really say, so suddenly a guideline or a rule comes 

out, it is fairly significant, that changes either their staffing, their 

budgeting, or materials, and they never got a voice. Someone did, 

but no one who is the someone. So allowing the agencies to define 

the someone at times gets a little too loose. 

Mr. PIERCE. I agree, and I agree with Professor Posner’s point 

very early on in the hearing that you cannot really solve that with 

legislation. It is too complicated, too variable. I have been working 

on the Clean Power Plan coordination process. There are about 

eight agencies in every State that have some role in the process of 

implementation, assuming that that rule is ultimately upheld and 

implemented, trying to figure out which agencies—they are all— 

they differ. They differ in their powers; they differ in their perspectives on what should be done. Trying to find them and say, OK, 

EPA usually works with the natural resource agencies. Well, in the 

case of this particular rule, the most important agencies are the 

public utility commissions. Well, seven of them are elected. The 

Governor has no power over them. The people are the only ones 

who have power over them. Others report to this—they each 

have—trying to figure out who to consult with in a very complicated 50-State system and within each State, seven, eight agencies with overlapping or conflicting power, it is a very difficult process. I do not think you are going to be able to solve it with legislation, and I am not sure how else to solve it. 

One suggestion is you could bring in, at least for informal consultation—my former colleague at Columbia who runs the American Law Institute that was responsible for getting the uniform 

code, Lance Liebman has been working on this for decades. His experience is it has gotten much harder. The things they were able 

to do in getting States to agree 20, 30 years ago, they cannot get 

that level of agreement. They cannot even get States to agree on 

who within the State is—— 

Senator LANKFORD. What about something just as basic for major 

rules like an Advanced Notice of Proposed Rulemaking? So it is 

Federal Register, publicly announced, everyone knows, now you are 

not having a matter of chasing down who is the right person within 

the State; it is a public announcement. But we get it in before the 

rulemaking actually begins. We give greater consultation early on 

in the process. So before there is text written and everyone is fighting about that word has this thing, it gives the ability for States, 

counties, affected parties—whether that be independent businesses, 

whatever it may be—they can actually rush in and say, ‘‘Have you 

considered the tribal impacts of this? Before you write the rule, 

think about this.’’ 
30 

Mr. PIERCE. Advanced Notices of Proposed Rulemaking certainly 

can be beneficial, and agencies sometimes use them with good benefit. They definitely add to the time required to make a decision. 

They add to the complexity. And, also, what you are suggesting assumes that there is not a draft until the agency issues—that is not 

true. 

Senator LANKFORD. Correct. 

Mr. PIERCE. And because of the way the courts have defined the 

requirements of a Notice of Proposed Rulemaking—the courts have 

defined that, not the way Congress defined it 70 years ago. They 

have redefined it in such a way that, as a practical matter, the first 

notice has to be the final, because if you make any change, you 

have to justify it to the satisfaction of the court. So the easy way 

to minimize the burden and risk of judicial review is by making all 

of the decisions before you ever put anything in writing, and most 

agencies—EPA is a good example. They have hundreds of meetings 

through which they come up with the initial draft. All you would 

be doing is backing that process up and saying all those meetings 

have to take place before the issuance of the Advanced Notice of 

Proposed Rulemaking because the courts would just come in and 

say if you have made a change, you have to justify it. 

The easy way around that is do not make changes, which means 

as a bottom line make all your decisions before you ever issue the 

notice. 

Senator LANKFORD. Which we are back to the same issue then. 

Mr. PIERCE. Yes. 

Senator LANKFORD. You do not get public consultation. The county never gets an opportunity to be able to speak to it because they 

have a group of folks that they normally work with and a group 

of attorneys that hash the issues, and they say, ‘‘We think this is 

the tightest language that we can make it work.’’ 

Mr. PIERCE. In the informal process, that I think is exactly right, 

and it is a big problem. In the formal process, they certainly have 

the right to come in with comments, and there has been a lot of 

empirical studies that show that they simply do not. They choose 

in most cases, for whatever reason—and I am sure a lot of this is 

resource problems at the State and local level. They choose, they 

say, ‘‘Oh, somebody just told me some Federal agency is proposing 

to do something we care about, and we have a right to comment 

on it.’’ We do not have the personnel, we do not have the time, we 

do not have the resources. And often just trying to figure out, is 

this the Governor or the Attorney General? In many cases, they 

dislike each other intensely and have completely conflicting views. 

And so if we say something on behalf of the Governor, well, the Attorney General is just going to come in and say, ‘‘That is all 

wrong.’’ Can we clear it with—this is a horrendously difficult practical problem that I know you appreciate it. 

Senator LANKFORD. I do. 

Mr. PIERCE. It needs to be solved, and I think we all appreciate 

it, but I do not have a good solution. 

Senator LANKFORD. Right. It is also why federalism is so important that the majority of these rules and issues should be handled 

on a State level, State to State rather than the Federal. But the 

things that are Federal, that is a whole different issue. 
31 

Mr. PIERCE. Thirty-eight types of gasoline in the United States 

today is a problem. 

Senator LANKFORD. We can talk about—now that some other 

folks here that are strong advocates for it are gone, we can also 

talk about ethanol requirements as well. But that is a whole different—— [Laughter.] 

Dr. Posner. 

Mr. POSNER. Just a quick footnote on this. I think the Earth and 

the Moon and the stars on consultation were aligned 6 years ago 

with the Recovery Act. It was tremendously urgent to get the 

money out the door, and I think GAO did a lot of studies on this. 

That was a peak where Governors, mayors, the President, the Vice 

President, the agency heads, all were focused on that one program. 

And the administration did a remarkable job in working with both 

the program people within the agencies as well as at the top, the 

Vice President and the Budget Director. They did weekly phone 

calls with States, State representatives and Governors, and I think 

everybody felt good about what happened. And there was also tremendous visibility to that spending, so, you had that reinforcement 

that everybody was kind of under the gun and the glare of publicity 

and transparency, a lot of information was being floated. And the 

system worked. So that was under a lot of stress. 

I think what we are talking about here is much more complicated when you are talking about rules and the like. But, there 

have been extraordinary periods where this has come together, and 

it might be worth studying that to see what lessons we can learn. 

Senator LANKFORD. The accountability on the back side of that 

was also very important. 

Senator Bramble, if there are any final comments, I will allow 

you to make them. But votes have just been called. You know exactly what that means as far as timing. So we will wrap up here 

in just a moment. Senator Bramble. 

Mr. BRAMBLE. Thank you. I just want to comment very quickly 

on the consultation. It is also a matter of timing. Some agencies, 

in talking with staff at NCSL and colleagues across the country, 

the timing can be critical. If an agency calls 12 hours before the 

rule is effective and then claims that, ‘‘Well, we reached out to the 

State,’’ that really does not count. They may check the box and say, 

‘‘We consulted immediately before it became effective,’’ but that is 

not the kind of consultation that works. 

Senator LANKFORD. Right. And that is the reason we have the 

courts to say, ‘‘Clearly the law was not followed as it was intended 

to be followed,’’ and now what happens? And I get the dynamic of 

it. But with no stick in the process and no voice that comes back, 

you struggle with how do you actually maintain enforcement consistency on this. 

Before we adjourn, I would like to announce to folks that on 

March 17, the Subcommittee will hold a hearing examining the degree of deference, another issue we can talk about at length at 

some point, the Federal courts and their granting of deference to 

regulatory agencies and examining that agency deference and what 

happens in the days ahead and the trends that we are facing on 

that. 
32 

This concludes our hearing today. I would like to thank our witnesses very much for your testimony. Your written testimony is obviously a part of the full long-term record. The hearing record itself 

will remain open for 15 days until the close of business on March 

the 10 for the submission of additional statements or questions for 

the record. 

With that, this hearing is adjourned. 

[Whereupon, at 12:10 p.m., the Committee was adjourned.] 
(33) 

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Æ