I

103D CONGRESS

1ST SESSION H. R. 1295

To improve Federal decisionmaking by requiring a thorough evaluation of

the economic impact of Federal legislative and regulatory requirements

on State and local governments and the economic resources located

therein.

IN THE HOUSE OF REPRESENTATIVES

MARCH 10, 1993

Mr. MORAN (for himself, Mr. GOODLING, Mr. HOLDEN, Mr. CONDIT, Mr.

BROWDER, Mr. DEAL, Mr. SISISKY, Mr. PAYNE of Virginia, Mr. WOLF,

Ms. MCKINNEY, Mr. PENNY, Mr. WHEAT, Mr. LANCASTER, Mr. PARKER,

Mr. GOODLATTE, Mr. MAZZOLI, Mr. BEREUTER, Ms. DANNER, Mr.

CANADY, Mr. GREENWOOD, Mr. PICKETT, Mr. KLINK, Mr. COOPER, Mr.

GENE GREEN of Texas, Mr. STENHOLM, Mr. TAYLOR of North Carolina,

Mr. PETERSON of Minnesota, Mr. TAYLOR of Mississippi, Mr. BILBRAY,

Mr. ROGERS, Mr. JOHNSTON of Florida, Mr. CRAMER, Mr. CRAPO, Mr.

MURPHY, Mr. TRAFICANT, Mr. THOMAS of Wyoming, Mr. EMERSON, Mr.

ORTON, Mr. CLINGER, Mr. MCHALE, Mrs. MEYERS of Kansas, Mr.

CAMP, Mr. LEWIS of Florida, Mr. SLATTERY, Mr. LIVINGSTON, Mr.

HYDE, Mr. CLEMENT, Mr. BLILEY, Mr. KANJORSKI, Mr. SPRATT, Mr.

TANNER, Mr. SARPALIUS, Mr. ROSE, Mr. MCCURDY, Mr. MONTGOMERY,

Mr. HOAGLAND, Mr. SWETT, Mr. ROWLAND, Mr. HALL of Texas, Mr.

POSHARD, Mr. BURTON of Indiana, Mr. RAHALL, Mr. WILSON, Mr. PETERSON of Florida, Mr. PETRI, Mr. ALLARD, Mr. BUYER, Mr. COLLINS

of Georgia, Mr. LAFALCE, Mr. COPPERSMITH, Mr. LIGHTFOOT, Mr.

BATEMAN, Mr. ENGLISH of Oklahoma, Mr. SKEEN, and Mr. MYERS of

Indiana) introduced the following bill; which was referred jointly to the

Committees on Government Operations and Rules

A BILL

To improve Federal decisionmaking by requiring a thorough

evaluation of the economic impact of Federal legislative
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and regulatory requirements on State and local governments and the economic resources located therein.

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 ‘‘Fiscal Accountability

5 and Intergovernmental Reform Act’’ (‘‘FAIR Act’’).

6 SEC. 2. FINDINGS AND PURPOSE.

7 (a) FINDINGS.—The Congress finds and declares:

8 (1) Federal legislation and regulatory require9 ments impose burdens on State and local resources

10 to implement federally mandated programs without

11 fully evaluating the costs to State and local govern12 ments associated with compliance with those require13 ments and often times without provision of adequate

14 Federal financial assistance. These Federal legisla15 tive and regulatory initiatives—

16 (A) force State and local governments to

17 utilize scarce public resources to comply with

18 Federal mandates;

19 (B) prevent these resources from being

20 available to meet local needs; and

21 (C) detract from the ability of State and

22 local governments to establish local priorities

23 for use of local public resources.
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1 (2) Federal legislation and regulatory programs

2 result in inefficient utilization of economic resources,

3 thereby reducing the pool of resources available—

4 (A) to enhance productivity, and increase

5 the quantity and quality of goods and services

6 produced by the American economy; and

7 (B) to enhance international competitive8 ness.

9 (3) In implementing Congressional policy, Fed10 eral agencies should, consistent with the require11 ments of Federal law, seek to implement statutory

12 requirements, to the maximum extent feasible, in a

13 manner which minimizes—

14 (A) the inefficient allocation of economic

15 resources;

16 (B) the burden such requirements impose

17 on use of local public resources by State and

18 local governments; and

19 (C) the adverse economic effects of such

20 regulations on productivity, economic growth,

21 full employment, creation of productive jobs,

22 and international competitiveness of American

23 goods and services.

24 (b) PURPOSES.—The purposes of this Act are:
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1 (1) To assist Congress in consideration of pro2 posed legislation establishing or revising Federal

3 programs so as to assure that, to the maximum ex4 tent practicable, legislation enacted by Congress

5 will—

6 (A) minimize the burden of such legislation

7 on expenditure of scarce local public resources

8 by State and local governments;

9 (B) minimize inefficient allocation of eco10 nomic resources; and

11 (C) reduce the adverse effect of such legis12 lation—

13 (i) on the ability of State and local

14 governmental entities to use local public

15 resources to meet local needs and to estab16 lish local priorities for local public re17 sources; and

18 (ii) on allocation of economic re19 sources, productivity, economic growth, full

20 employment, creation of productive jobs,

21 and international competitiveness.

22 (2) To require Federal agencies to exercise dis23 cretionary authority and to implement statutory re24 quirements in a manner which consistent with fulfill25 ment of each agency’s mission and with the require-
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1 ments of other laws, minimizes the impact regula2 tions and other major Federal actions affecting the

3 economy have on—

4 (A) the ability of State and local govern5 mental entities to use local public resources to

6 meet local needs; and

7 (B) the allocation of economic resources,

8 productivity, economic growth, full employment,

9 creation of productive jobs, and international

10 competitiveness of American goods and services.

11 TITLE I—LEGISLATIVE REFORM

12 SEC. 101. REPORTS ON LEGISLATION.

13 (a) REPORT REQUIRED.—(1) Except as provided in

14 paragraph (2), whenever a committee of either House re15 ports a bill or resolution of a public character to its House

16 which mandates unfunded requirements upon State or

17 local governments or the private sector, the report accom18 panying that bill or resolution shall contain an analysis,

19 prepared after consultation with the Director of the Con20 gressional Budget Office, detailing the effect of the new

21 requirements on—

22 (A) State and local government expenditures

23 necessary to comply with Federal mandates;
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1 (B) private businesses, including the economic

2 resources required annually to comply with the legis3 lation and implementing regulations; and

4 (C) economic growth and competitiveness.

5 (2) EXCEPTION.—The requirements of paragraph (1)

6 shall not apply to any bill or resolution with respect to

7 which the Director of the Congressional Budget Office cer8 tifies in writing to the Chairman of the Committee report9 ing the legislation that the estimated costs to State and

10 local governments and the private sector of implementa11 tion of such legislation during the first three years will

12 not exceed $50,000,000 in the aggregate and during the

13 first five years will not exceed $100,000,000 in the aggre14 gate. For this purpose, a year shall be a period of three

15 hundred and sixty five consecutive days.

16 (b) DUTIES AND FUNCTIONS OF CONGRESSIONAL

17 BUDGET OFFICE.—The Director of the Congressional

18 Budget Office shall prepare for each bill or resolution of

19 a public character reported by any committee of the House

20 of Representatives or of the Senate, an economic analysis

21 of the effects of such bill or resolution, satisfying the re22 quirements of subsection (a). The analysis prepared by the

23 Director of the Congressional Budget Office shall be in24 cluded in the report accompanying such bill or resolution
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1 if timely submitted to such committee before such report

2 is filed.

3 (c) LEGISLATION SUBJECT TO POINT OF ORDER.—

4 Any bill or resolution shall be subject to a point of order

5 against consideration of the bill by the House of Rep6 resentatives or the Senate (as the case may be) if such

7 bill or resolution is reported for consideration by the

8 House of Representatives or the Senate unaccompanied by

9 the analysis required by this section.

10 SEC. 102. EXERCISE OF RULEMAKING POWERS.

11 The provisions of this title are enacted by the Con12 gress—

13 (1) as an exercise of the rulemaking power of

14 the House of Representatives and the Senate, re15 spectively, and as such they shall be considered as

16 part of the rules of each House, respectively, and

17 such rules shall supersede other rules only to the ex18 tent that they are inconsistent therewith; and

19 (2) with full recognition of the constitutional

20 right of either House to change such rules (so far

21 as relating to such House) at any time, in the same

22 manner, and to the same extent as in the case of

23 any other rule of such House.
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1 SEC. 103. EFFECTIVE DATE.

2 This title shall apply to any bill or resolution ordered

3 reported by any committee of the House of Representa4 tives or of the Senate after the date of enactment of this

5 Act.

6 TITLE II—FEDERAL INTERGOVERNMENTAL

7 RELATIONS

8 SEC. 201. GENERAL REQUIREMENTS.

9 The Congress authorizes and directs that, to the full10 est extent practicable:

11 (1) the policies, regulations, and public laws of

12 the United States shall be interpreted and adminis13 tered in accordance with the purposes of this Act;

14 (2) all agencies of the Federal Government

15 shall, consistent with attainment of the requirements

16 of Federal law, minimize—

17 (A) the burden which rules and other

18 major Federal actions affecting the economy

19 impose on State and local governments,

20 (B) the effect of rules and other major

21 Federal actions affecting the economy on alloca22 tion of private economic resources, and

23 (C) the adverse effects of rules and other

24 major Federal actions affecting the economy on

25 productivity, economic growth, full employment,

26 creation of productive, and international com-
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1 petitiveness of American goods and services;

2 and

3 (3) in promulgating new rules, reviewing exist4 ing rules, developing legislative proposals, or initiat5 ing any other major Federal action affecting the

6 economy, whenever an agency identifies two or more

7 alternatives which will satisfy the agency’s statutory

8 obligations, the agency shall—

9 (A) select the alternative which, on bal10 ance—

11 (i) imposes the least burden on ex12 penditure of local public resources by State

13 and local governments, and

14 (ii) has the least adverse effect on

15 productivity, economic growth, full employ16 ment, creation of productive jobs, and

17 international competitiveness of American

18 goods or services; or

19 (B) provide a written statement—

20 (i) that the agency’s failure to select

21 such alternative is precluded by the re22 quirements of Federal law; or

23 (ii) that the agency’s failure to select

24 such alternative is consistent with the pur25 poses of this Act.
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1 SEC. 202. INTERGOVERNMENTAL AND ECONOMIC IMPACT

2 ASSESSMENT.

3 (a) REQUIREMENT.—Whenever an agency publishes

4 a general notice of proposed rulemaking for any proposed

5 rule, and before initiating any other major Federal action

6 affecting the economy, the agency shall prepare and make

7 available for public comment an Intergovernmental and

8 Economic Impact Assessment. Such Assessment shall be

9 published in the Federal Register at the time of the publi10 cation of general notice of proposed rulemaking for the

11 rule or prior to implementing such other major agency ac12 tion affecting the economy.

13 (b) CONTENT.—Each Intergovernmental and Eco14 nomic Impact Assessment required under this section shall

15 contain—

16 (1) a description of the reasons why action by

17 the agency is being considered;

18 (2) a succinct statement of the objective of, and

19 legal basis for, the proposed rule or other action;

20 and

21 (3) a description and an estimate of the effect

22 the proposed rule or other major Federal action will

23 have on—

24 (A) expenditure of State or local public re25 sources by State and local governments,

26 (B) allocation of economic resources, and
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1 (C) productivity, economic growth, full em2 ployment, creation of productive jobs, and inter3 national competitiveness of American goods and

4 services.

5 (c) ALTERNATIVES CONSIDERED.—Each Intergov6 ernmental and Economic Impact Assessment shall also

7 contain a detailed description of any significant alter8 natives to the proposed rule or other major Federal action

9 which would accomplish applicable statutory objectives

10 while reducing—

11 (1) the need for expenditure of State or local

12 public resources by State and local governments; and

13 (2) the potential adverse effects of such pro14 posed rule or other major Federal action on produc15 tivity, economic growth, full employment, creation of

16 productive jobs, and international competitiveness of

17 American goods and services.

18 SEC. 203. INTERGOVERNMENTAL AND ECONOMIC IMPACT

19 STATEMENT.

20 (a) REQUIREMENT.—When an agency promulgates a

21 final rule or implements any other major Federal action

22 affecting the economy, the agency shall prepare an Inter23 governmental and Economic Impact Statement. Each

24 Intergovernmental and Economic Impact Statement shall

25 contain—
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1 (1) a succinct statement of the need for, and

2 the objectives of, such rule or other major Federal

3 action;

4 (2) a summary of the issues raised by the pub5 lic comments in response to the publication by the

6 agency of the Economic Impact Assessment, a sum7 mary of the agency’s evaluation of such issues, and

8 a statement of any changes made in the proposed

9 rule or other proposed action as a result of such

10 comments;

11 (3) a description of each of the significant alter12 natives to the rule or other major Federal action af13 fecting the economy, considered by the agency,

14 which, consistent with fulfillment of agency statutory

15 obligations, would—

16 (A) lessen the need for expenditure of

17 State or local public resources by State and

18 local governments; or

19 (B) reduce the potential adverse effects of

20 such proposed rule or other major Federal ac21 tion on productivity, economic growth, full em22 ployment, creation of productive jobs, and inter23 national competitiveness of American goods and

24 services,
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1 along with a statement of the reasons why each such

2 alternatives was rejected by the agency; and

3 (4) an estimate of the effect the rule or other

4 major Federal action will have on—

5 (A) expenditure of State or local public re6 sources by State and local governments; and

7 (B) productivity, economic growth, full em8 ployment, creation of productive jobs, and inter9 national competitiveness of American goods and

10 services.

11 (b) AVAILABILITY.—The agency shall make copies of

12 each Intergovernmental and Economic Impact Statement

13 available to members of the public and shall publish in

14 the Federal Register at the time of publication of any final

15 rule or at the time of implementing any other major Fed16 eral action affecting the economy, a statement describing

17 how the public may obtain copies of such Statement.

18 SEC. 204. EFFECT ON OTHER LAWS.

19 The requirements of this title shall not alter in any

20 manner the substantive standards otherwise applicable to

21 the implementation by an agency of statutory require22 ments or to the exercise by an agency of authority dele23 gated by law.
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1 SEC. 205. EFFECTIVE DATE AND EXEMPTION.

2 This title shall apply to any rule proposed, any final

3 rule promulgated, and any other major Federal action af4 fecting the economy implemented by any agency after the

5 date of the enactment of this Act. This title shall not apply

6 to any agency which is not an agency within the meaning

7 of section 551(1) of title 5, United States Code.

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