Rulemaking

1

Melissa R. Bailey, Ph.D.

Agricultural Marketing Service | National Organic Program 

April 2014
Purpose

• Responds to feedback that stakeholders 

need a clearer understanding of the 

rulemaking process. 

• Explains what it takes to turn NOSB 

recommendation into a final change to the 

regulations.

• Describes when and how public can engage 

in this process along the way. 

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Legal Authority for Rules

• Statutes passed by Congress, signed into 

law by President, provide the authority for 

federal agencies to write regulations that 

implement the laws.

• An agency may issue rules only within 

scope of its authorizing statute. 

• Must be issued in accordance with 

Administrative Procedure Act. 

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The Simplified Rulemaking Process

• Publish Proposed Rule in the Federal 

Register. 

• Provide interested parties an opportunity 

to submit written data, views, or opinions 

about the proposed rule. 

• Publish a Final Rule in the Federal Register. 

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How does NOP initiate a rulemaking? 

• We are required to prepare, submit and 

receive approval on a regulatory 

workplan for every stage of rulemaking.

– Summarizes objectives, possible 

alternatives, and effects of action to 

policy officials (non-technical)

– Provides information needed for 

“designation” of significance 

– Communicates to OMB and public 

about agencies regulatory plan

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Office of Management & Budget

• Office of Information and Regulatory Affairs 

(OIRA) 

– Operates as an “information aggregator” 

across government

– Facilitates interagency coordination & 

communication

– Considers costs and benefits of regulations

– Ensures public engagement in process

– Ensures compliance with relevant statutes 

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How does OMB determine which 

regulations to review?

OMB “designates” every planned 

regulatory action through a workplan:

–Not significant: OMB does not review 

rule*; 

– Significant or Economically 

Significant: OMB reviews the rule. 

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Significance

• OMB reviews rules that are: 

– Likely to have an annual effect on the economy of over 

$100 million or more, or adversely affect the economy, 

a sector of the economy, jobs, or competition;

– Creates serious inconsistency or interferes with an 

action of another agency;

– Materially alter the budgetary impact of existing 

programs; or

– Raises novel legal or policy issues.

*Rules that have an effect of $100M or more on the 

economy are Economically Significant rules, often 

considered “major” and triggers Congressional Review 

Act. 

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How do stakeholders know what rules 

agencies are working on?

• Once OMB approves a workplan, this 

information is published:

– In the fall in a “Regulatory Plan”; and 

– Every spring and fall an “Agenda of 

Regulatory and Deregulatory Actions”. 

• This “Unified Agenda” is how agencies 

announce future rulemaking activities update 

the public on pending and completed 

regulatory actions.

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Executive Orders & Other Requirements

• EO 12866 & 13563 – Regulatory Impact 

Analysis

– Costs, benefits, alternatives

• Regulatory Flexibility Act

• Paperwork Reduction Act

• EO 13175 – Consultation with Tribal 

Governments

• Civil Rights Impact Analysis

• EO 12988 – Civil Justice Reform

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Great! Whew. We finished a draft. 

How do we clear rules for publication?

Not Significant Action

Office of General Counsel

Deputy Administrator

Administrator

Undersecretary

Secretary

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Significant Action

Office of General Counsel

Deputy Administrator

Administrator

Office of Budget and Program Analysis

Office of Risk Assessment and Cost Benefit Analysis

Assistant Secretary, Civil Rights

Office of Chief Economist

Office of Chief of Information

Office of Tribal Relations

Undersecretary 

Secretary

OMB – includes interagency review. 

90-day review; can be extended. 

(Congressional Review Act)
Why does rulemaking take so long?

• Review of NOSB recommendation

• Draft Regulatory Workplan for OMB Designation

• Conduct and Draft Required Analyses

• Draft Proposed Rule

• Clearance & Federal Register Publication

• Comment Period

• Comment Analysis

• Workplan Addendum for OMB Designation

• Revise Required Analyses

• Draft Final Rule

• Clearance & Federal Register Publication

• Effective Date of Final Rule 

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Proposed 

Rule 

Stage

Final Rule 

Stage
How can public comments 

affect the final rule?

• The notice-and-comment process 

enables anyone to submit a comment 

on any part of a proposed rule. 

• This process is not like a ballot initiative 

or an up-or-down vote in a legislature.

• An agency is not permitted to base its 

final rule on the number of comments in 

support of the rule over those in 

opposition to it. 

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How can public comments 

affect the final rule?

• The agency must base its reasoning and 

conclusions on the rulemaking record, 

consisting of the comments, scientific data, 

expert opinions, and facts accumulated during 

the pre-rule and proposed rule stages.

• If the rulemaking record contains persuasive 

new data or sound policy arguments, the 

agency may decide to terminate the 

rulemaking. 

• Or, the agency may decide to continue the 

rulemaking but change aspects of the rule to 

reflect these new issues. 

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How are rules incorporated into the 

regulations?

• The Code of Federal Regulations (CFR) contains all 

of the generally applicable rules of the Federal 

government with current or future effect.

• On the day a final rule is published in the Federal 

Register, Federal Register staff process the material 

for codification into the CFR. 

– Rules that are immediately effective are 

integrated into the “Electronic Code of Federal 

Regulations” (e-CFR) database 

(ecfr.gpoaccess.gov). 

– Rules with delayed effective dates are placed in 

amendment files and linked from the main e-CFR 

database. 

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Why is the whole process important!

• Courts can find a rule unlawful if:

– It is arbitrary, capricious, an abuse of 

discretion, or not in accordance with 

the law;

– It is in excess of the agency’s statutory 

authority; and/or

– The agency did not follow the proper 

procedure in promulgating the rule. 

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Resources

• A Guide to the Rulemaking Process

– Office of Federal Register

• The Office of Information and 

Regulatory Affairs: Myths and Realities

– Commentary By Cass R. Sunstein

• The Regulatory Plan and Unified Agenda

– Office of Management & Budget

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