II 

112TH CONGRESS 

1ST SESSION S. 1615 

To require enhanced economic analysis and justification of regulations proposed by certain Federal banking, housing, securities, and commodity 

regulators, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 22, 2011 

Mr. SHELBY (for himself, Mr. CRAPO, Mr. CORKER, Mr. DEMINT, Mr. VITTER, Mr. JOHANNS, Mr. TOOMEY, Mr. KIRK, Mr. MORAN, and Mr. 

WICKER) introduced the following bill; which was read twice and referred 

to the Committee on Banking, Housing, and Urban Affairs 

A BILL 

To require enhanced economic analysis and justification of 

regulations proposed by certain Federal banking, housing, securities, and commodity regulators, and for other 

purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Financial Regulatory 

5 Responsibility Act of 2011’’. 

6 SEC. 2. DEFINITIONS. 

7 As used in this Act— 


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1 (1) the term ‘‘agency’’ means the Board of Gov2 ernors of the Federal Reserve System, the Bureau of 

3 Consumer Financial Protection, the Commodity Fu4 tures Trading Commission, the Federal Deposit In5 surance Corporation, the Federal Housing Finance 

6 Agency, the Financial Stability Oversight Council, 

7 the Office of the Comptroller of the Currency, the 

8 Office of Financial Research, the National Credit 

9 Union Administration, and the Securities and Ex10 change Commission; 

11 (2) the term ‘‘chief economist’’ means— 

12 (A) with respect to the Board of Governors 

13 of the Federal Reserve System, the Director of 

14 the Division of Research and Statistics, or an 

15 employee of the agency with comparable author16 ity; 

17 (B) with respect to the Bureau of Con18 sumer Financial Protection, the Assistant Di19 rector for Research, or an employee of the 

20 agency with comparable authority; 

21 (C) with respect to the Commodity Fu22 tures Trading Commission, the Chief Econo23 mist, or an employee of the agency with com24 parable authority; 


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1 (D) with respect to the Federal Deposit 

2 Insurance Corporation, the Director of the Divi3 sion of Insurance and Research, or an employee 

4 of the agency with comparable authority; 

5 (E) with respect to the Federal Housing 

6 Finance Agency, the Chief Economist, or an 

7 employee of the agency with comparable author8 ity; 

9 (F) with respect to the Financial Stability 

10 Oversight Council, the Chief Economist, or an 

11 employee of the agency with comparable author12 ity; 

13 (G) with respect to the Office of the Comp14 troller of the Currency, the Director for Policy 

15 Analysis, or an employee of the agency with 

16 comparable authority; 

17 (H) with respect to the Office of Financial 

18 Research, the Director, or an employee of the 

19 agency with comparable authority; 

20 (I) with respect to the National Credit 

21 Union Administration, the Chief Economist, or 

22 an employee of the agency with comparable au23 thority; and 

24 (J) with respect to the Securities and Ex25 change Commission, the Director of the DiviVerDate Mar 15 2010 03:52 Sep 24, 2011 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S1615.IS S1615

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1 sion of Risk, Strategy, and Financial Innova2 tion, or an employee of the agency with com3 parable authority; 

4 (3) the term ‘‘Council’’ means the Chief Econo5 mists Council established under section 9; and 

6 (4) the term ‘‘regulation’’— 

7 (A) means an agency statement of general 

8 applicability and future effect that is designed 

9 to implement, interpret, or prescribe law or pol10 icy or to describe the procedure or practice re11 quirements of an agency, including rules, orders 

12 of general applicability, interpretive releases, 

13 and other statements of general applicability 

14 that the agency intends to have the force and 

15 effect of law; 

16 (B) does not include— 

17 (i) a regulation issued in accordance 

18 with the formal rulemaking provisions of 

19 section 556 or 557 of title 5, United States 

20 Code; 

21 (ii) a regulation that is limited to 

22 agency organization, management, or per23 sonnel matters; 


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1 (iii) a regulation promulgated pursu2 ant to statutory authority that expressly 

3 prohibits compliance with this provision; 

4 (iv) a regulation that is certified by 

5 the agency to be an emergency action, if 

6 such certification is published in the Fed7 eral Register; or 

8 (v) a regulation that is promulgated 

9 by the Board of Governors of the Federal 

10 Reserve System or the Federal Open Mar11 ket Committee under section 10A, 10B, 

12 13, 13A, or 19 of the Federal Reserve Act, 

13 or any of subsections (a) through (f) of 

14 section 14 of that Act. 

15 SEC. 3. REQUIRED REGULATORY ANALYSIS. 

16 (a) REQUIREMENTS FOR NOTICES OF PROPOSED

17 RULEMAKING.—An agency may not issue a notice of pro18 posed rulemaking unless the agency includes in the notice 

19 of proposed rulemaking an analysis that contains, at a 

20 minimum, with respect to each regulation that is being 

21 proposed— 

22 (1) an identification of the need for the regula23 tion and the regulatory objective, including identi24 fication of the nature and significance of the market 


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1 failure, regulatory failure, or other problem that ne2 cessitates the regulation; 

3 (2) an explanation of why the private market or 

4 State, local, or tribal authorities cannot adequately 

5 address the identified market failure or other prob6 lem; 

7 (3) an analysis of the adverse impacts to regu8 lated entities, other market participants, economic 

9 activity, or agency effectiveness that are engendered 

10 by the regulation and the magnitude of such adverse 

11 impacts; 

12 (4) a quantitative and qualitative assessment of 

13 all anticipated direct and indirect costs and benefits 

14 of the regulation (as compared to a benchmark that 

15 assumes the absence of the regulation), including— 

16 (A) compliance costs; 

17 (B) effects on economic activity, net job 

18 creation (excluding jobs related to ensuring 

19 compliance with the regulation), efficiency, com20 petition, and capital formation; 

21 (C) regulatory administrative costs; and 

22 (D) costs imposed by the regulation on 

23 State, local, or tribal governments or other reg24 ulatory authorities; 


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1 (5) if quantified benefits do not outweigh quan2 titative costs, a justification for the regulation; 

3 (6) identification and assessment of all available 

4 alternatives to the regulation, including modification 

5 of an existing regulation or statute, together with— 

6 (A) an explanation of why the regulation 

7 meets the objectives of the regulation more ef8 fectively than the alternatives, and if the agency 

9 is proposing multiple alternatives, an expla10 nation of why a notice of proposed rulemaking, 

11 rather than an advanced notice of proposed 

12 rulemaking, is appropriate; and 

13 (B) if the regulation is not a pilot pro14 gram, an explanation of why a pilot program is 

15 not appropriate; 

16 (7) if the regulation specifies the behavior or 

17 manner of compliance, an explanation of why the 

18 agency did not instead specify performance objec19 tives; 

20 (8) an assessment of how the burden imposed 

21 by the regulation will be distributed among market 

22 participants, including whether consumers, investors, 

23 or small businesses will be disproportionately bur24 dened; 


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1 (9) an assessment of the extent to which the 

2 regulation is inconsistent, incompatible, or duplica3 tive with the existing regulations of the agency or 

4 those of other domestic and international regulatory 

5 authorities with overlapping jurisdiction; 

6 (10) a description of any studies, surveys, or 

7 other data relied upon in preparing the analysis; 

8 (11) an assessment of the degree to which the 

9 key assumptions underlying the analysis are subject 

10 to uncertainty; and 

11 (12) an explanation of predicted changes in 

12 market structure and infrastructure and in behavior 

13 by market participants, including consumers and in14 vestors, assuming that they will pursue their eco15 nomic interests. 

16 (b) REQUIREMENTS FOR NOTICES OF FINAL RULE17 MAKING.— 

18 (1) IN GENERAL.—Notwithstanding any other 

19 provision of law, an agency may not issue a notice 

20 of final rulemaking with respect to a regulation un21 less the agency— 

22 (A) has issued a notice of proposed rule23 making for the relevant regulation; 

24 (B) has conducted and includes in the no25 tice of final rulemaking an analysis that conVerDate Mar 15 2010 03:52 Sep 24, 2011 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S1615.IS S1615

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1 tains, at a minimum, the elements required 

2 under subsection (a); and 

3 (C) includes in the notice of final rule4 making regulatory impact metrics selected by 

5 the chief economist to be used in preparing the 

6 report required pursuant to section 6. 

7 (2) CONSIDERATION OF COMMENTS.—The 

8 agency shall incorporate in the elements described in 

9 paragraph (1)(B) the data and analyses provided to 

10 the agency by commenters during the comment pe11 riod, or explain why the data or analyses are not 

12 being incorporated. 

13 (3) COMMENT PERIOD.—An agency shall not 

14 publish a notice of final rulemaking with respect to 

15 a regulation, unless the agency— 

16 (A) has allowed at least 90 days from the 

17 date of publication in the Federal Register of 

18 the notice of proposed rulemaking for the sub19 mission of public comments; or 

20 (B) includes in the notice of final rule21 making an explanation of why the agency was 

22 not able to provide a 90-day comment period. 

23 (4) PROHIBITED RULES.— 

24 (A) IN GENERAL.—An agency may not 

25 publish a notice of final rulemaking if the agenVerDate Mar 15 2010 03:52 Sep 24, 2011 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S1615.IS S1615

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1 cy, in its analysis under paragraph (1)(B), de2 termines that the quantified costs are greater 

3 than the quantified benefits under subsection 

4 (a)(5). 

5 (B) PUBLICATION OF ANALYSIS.—If the 

6 agency is precluded by subparagraph (A) from 

7 publishing a notice of final rulemaking, the 

8 agency shall publish in the Federal Register 

9 and on the public website of the agency its 

10 analysis under paragraph (1)(B), and provide 

11 the analysis to each House of Congress. 

12 (C) CONGRESSIONAL WAIVER.—If the 

13 agency is precluded by subparagraph (A) from 

14 publishing a notice of final rulemaking, Con15 gress, by joint resolution pursuant to the proce16 dures set forth for joint resolutions in section 

17 802 of title 5, United States Code, may direct 

18 the agency to publish a notice of final rule19 making notwithstanding the prohibition con20 tained in subparagraph (A). In applying section 

21 802 of title 5, United States Code, for purposes 

22 of this paragraph, section 802(e)(2) shall not 

23 apply and the term— 

24 (i) ‘‘joint resolution’’ or ‘‘joint resolu25 tion described in subsection (a)’’ means 


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1 only a joint resolution introduced during 

2 the period beginning on the submission or 

3 publication date and ending 60 days there4 after (excluding days either House of Con5 gress is adjourned for more than 3 days 

6 during a session of Congress), the matter 

7 after the resolving clause of which is as fol8 lows: ‘‘That Congress directs, notwith9 standing the prohibition contained in 

10 (3)(b)(4)(A) of the Financial Regulatory 

11 Responsibility Act of 2011, the ll to 

12 publish the notice of final rulemaking for 

13 the regulation or regulations that were the 

14 subject of the analysis submitted by the 

15 ll to Congress on ll.’’ (The blank 

16 spaces being appropriately filled in.); and 

17 (ii) ‘‘submission or publication date’’ 

18 means— 

19 (I) the date on which the analysis 

20 under paragraph (1)(B) is submitted 

21 to Congress under paragraph (4)(B); 

22 or 

23 (II) if the analysis is submitted 

24 to Congress less than 60 session days 

25 or 60 legislative days before the date 


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1 on which the Congress adjourns a ses2 sion of Congress, the date on which 

3 the same or succeeding Congress first 

4 convenes its next session. 

5 SEC. 4. RULE OF CONSTRUCTION. 

6 For purposes of the Paperwork Reduction Act (44 

7 U.S.C. 3501 et seq.), obtaining, causing to be obtained, 

8 or soliciting information for purposes of complying with 

9 section 3 with respect to a proposed rulemaking shall not 

10 be construed to be a collection of information, provided 

11 that the agency has first issued an advanced notice of pro12 posed rulemaking in connection with the regulation, iden13 tifies that advanced notice of proposed rulemaking in its 

14 solicitation of information, and informs the person from 

15 whom the information is obtained or solicited that the pro16 vision of information is voluntary. 

17 SEC. 5. PUBLIC AVAILABILITY OF DATA AND REGULATORY 

18 ANALYSIS. 

19 (a) IN GENERAL.—At or before the commencement 

20 of the public comment period with respect to a regulation, 

21 the agency shall make available on its public website suffi22 cient information about the data, methodologies, and as23 sumptions underlying the analyses performed pursuant to 

24 section 3 so that the analytical results of the agency are 


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1 capable of being substantially reproduced, subject to an 

2 acceptable degree of imprecision or error. 

3 (b) CONFIDENTIALITY.—The agency shall comply 

4 with subsection (a) in a manner that preserves the con5 fidentiality of nonpublic information, including confiden6 tial trade secrets, confidential commercial or financial in7 formation, and confidential information about positions, 

8 transactions, or business practices. 

9 SEC. 6. FIVE-YEAR REGULATORY IMPACT ANALYSIS. 

10 (a) IN GENERAL.—Not later than 5 years after the 

11 date of publication in the Federal Register of a notice of 

12 final rulemaking, the chief economist of the agency shall 

13 issue a report that examines the economic impact of the 

14 subject regulation, including the direct and indirect costs 

15 and benefits of the regulation. 

16 (b) REGULATORY IMPACT METRICS.—In preparing 

17 the report required by subsection (a), the chief economist 

18 shall employ the regulatory impact metrics included in the 

19 notice of final rulemaking pursuant to section 3(b)(1)(C). 

20 (c) REPRODUCIBILITY.—The report shall include the 

21 data, methodologies, and assumptions underlying the eval22 uation so that the agency’s analytical results are capable 

23 of being substantially reproduced, subject to an acceptable 

24 degree of imprecision or error. 


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1 (d) CONFIDENTIALITY.—The agency shall comply 

2 with subsection (c) in a manner that preserves the con3 fidentiality of nonpublic information, including confiden4 tial trade secrets, confidential commercial or financial in5 formation, and confidential information about positions, 

6 transactions, or business practices. 

7 (e) REPORT.—The agency shall submit the report re8 quired by subsection (a) to the Committee on Banking, 

9 Housing, and Urban Affairs of the Senate and the Com10 mittee on Financial Services of the House of Representa11 tives and post it on the public website of the agency. The 

12 Commodity Futures Trading Commission shall also sub13 mit its report to the Committee on Agriculture, Nutrition, 

14 and Forestry of the Senate and the Committee on Agri15 culture of the House of Representatives. 

16 SEC. 7. RETROSPECTIVE REVIEW OF EXISTING RULES. 

17 (a) REGULATORY IMPROVEMENT PLAN.—Not later 

18 than 1 year after the date of enactment of this Act and 

19 every 5 years thereafter, each agency shall develop, submit 

20 to the Committee on Banking, Housing, and Urban Af21 fairs of the Senate and the Committee on Financial Serv22 ices of the House of Representatives, and post on the pub23 lic website of the agency a plan, consistent with law and 

24 its resources and regulatory priorities, under which the 

25 agency will modify, streamline, expand, or repeal existing 


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1 regulations so as to make the regulatory program of the 

2 agency more effective or less burdensome in achieving the 

3 regulatory objectives. The Commodity Futures Trading 

4 Commission shall also submit its plan to the Committee 

5 on Agriculture, Nutrition, and Forestry of the Senate and 

6 the Committee on Agriculture of the House of Representa7 tives. 

8 (b) IMPLEMENTATION PROGRESS REPORT.—Two 

9 years after the date of submission of each plan required 

10 under subsection (a), each agency shall develop, submit 

11 to the Committee on Banking, Housing, and Urban Af12 fairs of the Senate and the Committee on Financial Serv13 ices of the House of Representatives, and post on the pub14 lic website of the agency a report of the steps that it has 

15 taken to implement the plan, steps that remain to be taken 

16 to implement the plan, and, if any parts of the plan will 

17 not be implemented, reasons for not implementing those 

18 parts of the plan. The Commodity Futures Trading Com19 mission shall also submit its plan to the Committee on 

20 Agriculture, Nutrition, and Forestry of the Senate and the 

21 Committee on Agriculture of the House of Representa22 tives. 

23 SEC. 8. JUDICIAL REVIEW. 

24 (a) IN GENERAL.—Notwithstanding any other provi25 sion of law, during the period beginning on the date on 


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1 which a notice of final rulemaking for a regulation is pub2 lished in the Federal Register and ending 1 year later, 

3 a person that is adversely affected or aggrieved by the reg4 ulation is entitled to bring an action in the United States 

5 Court of Appeals for the District of Columbia Circuit for 

6 judicial review of agency compliance with the requirements 

7 of section 3. 

8 (b) STAY.—The court may stay the effective date of 

9 the regulation or any provision thereof. 

10 (c) RELIEF.—If the court finds that an agency has 

11 not complied with the requirements of section 3, the court 

12 shall vacate the subject regulation, unless the agency 

13 shows by clear and convincing evidence that vacating the 

14 regulation would result in irreparable harm. Nothing in 

15 this section affects other limitations on judicial review or 

16 the power or duty of the court to dismiss any action or 

17 deny relief on any other appropriate legal or equitable 

18 ground. 

19 SEC. 9. CHIEF ECONOMISTS COUNCIL. 

20 (a) ESTABLISHMENT.—There is established the Chief 

21 Economists Council. 

22 (b) MEMBERSHIP.—The Council shall consist of the 

23 chief economist of each agency. The members of the Coun24 cil shall select the first chairperson of the Council. ThereVerDate Mar 15 2010 03:52 Sep 24, 2011 Jkt 099200 PO 00000 Frm 00016 Fmt 6652 Sfmt 6201 E:\BILLS\S1615.IS S1615

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1 after the position of Chairperson shall rotate annually 

2 among the members of the Council. 

3 (c) MEETINGS.—The Council shall meet at the call 

4 of the Chairperson, but not less frequently than quarterly. 

5 (d) REPORT.—One year after the effective date of 

6 this Act and annually thereafter, the Council shall prepare 

7 and submit to the Committee on Banking, Housing, and 

8 Urban Affairs and the Committee on Agriculture, Nutri9 tion, and Forestry of the Senate and the Committee on 

10 Financial Services and the Committee on Agriculture of 

11 the House of Representatives a report on— 

12 (1) the benefits and costs of regulations adopt13 ed by the agencies during the past 12 months; 

14 (2) the regulatory actions planned by the agen15 cies for the upcoming 12 months; 

16 (3) the cumulative effect of the existing regula17 tions of the agencies on economic activity, innova18 tion, international competitiveness of entities regu19 lated by the agencies, and net job creation (exclud20 ing jobs related to ensuring compliance with the reg21 ulation); 

22 (4) the training and qualifications of the per23 sons who prepared the cost-benefit analyses of each 

24 agency during the past 12 months; 


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1 (5) the sufficiency of the resources available to 

2 the chief economists during the past 12 months for 

3 the conduct of the activities required by this Act; 

4 and 

5 (6) recommendations for legislative or regu6 latory action to enhance the efficiency and effective7 ness of financial regulation in the United States. 

8 SEC. 10. CONFORMING AMENDMENTS. 

9 Section 15(a) of the Commodity Exchange Act (7 

10 U.S.C. 19(a)) is amended— 

11 (1) by striking paragraph (1); 

12 (2) in paragraph (2), by striking (2) and all 

13 that follows through ‘‘light of—’’ and inserting the 

14 following: 

15 ‘‘(1) CONSIDERATIONS.—Before promulgating a 

16 regulation under this chapter or issuing an order 

17 (except as provided in paragraph (2)), the Commis18 sion shall take into consideration—’’; 

19 (3) in paragraph (1), as so redesignated— 

20 (A) in subparagraph (B), by striking ‘‘fu21 tures’’ and inserting ‘‘the relevant’’; 

22 (B) in subparagraph (C), by adding ‘‘and’’ 

23 at the end; 

24 (C) in subparagraph (D), by striking 

25 ‘‘and’’ at the end; and 


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1 (D) by striking subparagraph (E); and 

2 (4) by redesignating paragraph (3) as para3 graph (2). 

4 SEC. 11. OTHER REGULATORY ENTITIES. 

5 (a) SECURITIES AND EXCHANGE COMMISSION.—Not 

6 later than 1 year after the date of enactment of this Act, 

7 the Securities and Exchange Commission shall provide to 

8 the Committee on Banking, Housing, and Urban Affairs 

9 of the Senate and the Committee on Financial Services 

10 of the House of Representatives a report setting forth a 

11 plan for subjecting the Public Company Accounting Over12 sight Board, the Municipal Securities Rulemaking Board, 

13 and any national securities association registered under 

14 section 15A of the Securities Exchange Act of 1934 (15 

15 U.S.C. 78o–4(a)) to the requirements of this Act, other 

16 than direct representation on the Council. 

17 (b) COMMODITY FUTURES TRADING COMMISSION.— 

18 Not later than 1 year after the date of enactment of this 

19 Act, the Commodity Futures Trading Commission shall 

20 provide to the Committee on Banking, Housing, and 

21 Urban Affairs of the Senate, the Committee on Financial 

22 Services of the House of Representatives, the Committee 

23 on Agriculture, Nutrition, and Forestry of the Senate, and 

24 the Committee on Agriculture of the House of Representa25 tives a report setting forth a plan for subjecting any fuVerDate Mar 15 2010 03:52 Sep 24, 2011 Jkt 099200 PO 00000 Frm 00019 Fmt 6652 Sfmt 6201 E:\BILLS\S1615.IS S1615

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1 tures association registered under section 17 of the Com2 modity Exchange Act (7 U.S.C. 21) to the requirements 

3 of this Act, other than direct representation on the Coun4 cil. 

5 SEC. 12. AVOIDANCE OF DUPLICATIVE OR UNNECESSARY 

6 ANALYSES. 

7 An agency may perform the analyses required by this 

8 Act in conjunction with, or as a part of, any other agenda 

9 or analysis required by any other provision of law, if such 

10 other analysis satisfies the provisions this Act. 

11 SEC. 13. SEVERABILITY. 

12 If any provision of this Act or the application of any 

13 provision of this Act to any person or circumstance, is held 

14 invalid, the application of such provision to other persons 

15 or circumstances, and the remainder of this Act, shall not 

16 be affected thereby. 

Æ 


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