II

106TH CONGRESS

1ST SESSION S. 746

To provide for analysis of major rules, to promote the public’s right to

know the costs and benefits of major rules, and to increase the accountability and quality of Government.

IN THE SENATE OF THE UNITED STATES

MARCH 25, 1999

Mr. LEVIN (for himself, Mr. THOMPSON, Mr. VOINOVICH, Mr. ROBB, Mr.

ABRAHAM, Mr. ROCKEFELLER, Mr. ROTH, Mr. DASCHLE, Mr. STEVENS,

Mr. MOYNIHAN, Mr. COCHRAN, Mr. BREAUX, Mr. FRIST, Mr. ENZI, Mr.

GRAMS, Mr. GRASSLEY, and Mrs. LINCOLN) introduced the following bill;

which was read twice and referred to the Committee on Governmental Affairs

A BILL

To provide for analysis of major rules, to promote the

public’s right to know the costs and benefits of major

rules, and to increase the accountability and quality of

Government.

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 ‘‘Regulatory Improve5 ment Act of 1999’’.
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1 SEC. 2. FINDINGS.

2 Congress finds the following:

3 (1) Effective regulatory programs provide im4 portant benefits to the public, including improving

5 the environment, worker safety, and public health.

6 Regulatory programs also impose significant costs

7 on the public, including individuals, businesses, and

8 State, local, and tribal governments.

9 (2) Improving the ability of Federal agencies to

10 use scientific and economic analysis in developing

11 regulations should yield increased benefits and more

12 effective protections while minimizing costs.

13 (3) Cost-benefit analysis and risk assessment

14 are useful tools to better inform agencies in devel15 oping regulations, although such analyses and as16 sessments do not replace the need for good judgment

17 and consideration of values.

18 (4) The evaluation of costs and benefits must

19 involve the consideration of the relevant information,

20 whether expressed in quantitative or qualitative

21 terms, including factors such as social values, dis22 tributional effects, and equity.

23 (5) Cost-benefit analysis and risk assessment

24 should be presented with a clear statement of the

25 analytical assumptions and uncertainties, including

26 an explanation of what is known and not known and
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1 what the implications of alternative assumptions

2 might be.

3 (6) The public has a right to know about the

4 costs and benefits of regulations, the risks ad5 dressed, the risks reduced, and the quality of sci6 entific and economic analysis used to support deci7 sions. Such knowledge will promote the quality, in8 tegrity and responsiveness of agency actions.

9 (7) The Administrator of the Office of Informa10 tion and Regulatory Affairs should oversee regu11 latory activities to raise the quality and consistency

12 of cost-benefit analysis and risk assessment among

13 all agencies.

14 (8) The Federal Government should develop a

15 better understanding of the strengths, weaknesses,

16 and uncertainties of cost-benefit analysis and risk

17 assessment and conduct the research needed to im18 prove these analytical tools.

19 SEC. 3. REGULATORY ANALYSIS.

20 (a) IN GENERAL.—Chapter 6 of title 5, United

21 States Code, is amended by adding at the end the fol22 lowing:
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1 ‘‘SUBCHAPTER II—REGULATORY ANALYSIS

2 ‘‘§ 621. Definitions

3 ‘‘For purposes of this subchapter the definitions

4 under section 551 shall apply and—

5 ‘‘(1) the term ‘Administrator’ means the Ad6 ministrator of the Office of Information and Regu7 latory Affairs of the Office of Management and

8 Budget;

9 ‘‘(2) the term ‘benefit’ means the reasonably

10 identifiable significant favorable effects, quantifiable

11 and nonquantifiable, including social, health, safety,

12 environmental, economic, and distributional effects,

13 that are expected to result from implementation of,

14 or compliance with, a rule;

15 ‘‘(3) the term ‘cost’ means the reasonably iden16 tifiable significant adverse effects, quantifiable and

17 nonquantifiable, including social, health, safety, envi18 ronmental, economic, and distributional effects, that

19 are expected to result from implementation of, or

20 compliance with, a rule;

21 ‘‘(4) the term ‘cost-benefit analysis’ means an

22 evaluation of the costs and benefits of a rule, quan23 tified to the extent feasible and appropriate and oth24 erwise qualitatively described, that is prepared in ac25 cordance with the requirements of this subchapter at
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1 the level of detail appropriate and practicable for

2 reasoned decisionmaking on the matter involved,

3 taking into consideration uncertainties, the signifi4 cance and complexity of the decision, and the need

5 to adequately inform the public;

6 ‘‘(5) the term ‘Director’ means the Director of

7 the Office of Management and Budget, acting

8 through the Administrator of the Office of Informa9 tion and Regulatory Affairs;

10 ‘‘(6) the term ‘flexible regulatory options’

11 means regulatory options that permit flexibility to

12 regulated persons in achieving the objective of the

13 statute as addressed by the rule making, including

14 regulatory options that use market-based mecha15 nisms, outcome oriented performance-based stand16 ards, or other options that promote flexibility;

17 ‘‘(7) the term ‘major rule’ means a rule that—

18 ‘‘(A) the agency proposing the rule or the

19 Director reasonably determines is likely to have

20 an annual effect on the economy of

21 $100,000,000 or more in reasonably quantifi22 able costs; or

23 ‘‘(B) is otherwise designated a major rule

24 by the Director on the ground that the rule is

25 likely to adversely affect, in a material way, the
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1 economy, a sector of the economy, including

2 small business, productivity, competition, jobs,

3 the environment, public health or safety, or

4 State, local or tribal governments, or commu5 nities;

6 ‘‘(8) the term ‘reasonable alternative’ means a

7 reasonable regulatory option that would achieve the

8 objective of the statute as addressed by the rule

9 making and that the agency has authority to adopt

10 under the statute granting rule making authority,

11 including flexible regulatory options;

12 ‘‘(9) the term ‘risk assessment’ means the sys13 tematic, objective process of organizing hazard and

14 exposure information, based on a careful analysis of

15 the weight of the scientific evidence, to estimate the

16 potential for specific harm to an exposed population,

17 subpopulation, or natural resource including, to the

18 extent feasible, a characterization of the distribution

19 of risk as well as an analysis of uncertainties,

20 variabilities, conflicting information, and inferences

21 and assumptions;

22 ‘‘(10) the term ‘rule’ has the same meaning as

23 in section 551(4), and shall not include—

24 ‘‘(A) a rule exempt from notice and public

25 comment procedure under section 553;
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1 ‘‘(B) a rule that involves the internal rev2 enue laws of the United States, or the assess3 ment or collection of taxes, duties, or other

4 debts, revenue, or receipts;

5 ‘‘(C) a rule of particular applicability that

6 approves or prescribes for the future rates,

7 wages, prices, services, corporate or financial

8 structures, reorganizations, mergers, acquisi9 tions, accounting practices, or disclosures bear10 ing on any of the foregoing;

11 ‘‘(D) a rule relating to monetary policy

12 proposed or promulgated by the Board of Gov13 ernors of the Federal Reserve System or by the

14 Federal Open Market Committee;

15 ‘‘(E) a rule relating to the operations, safe16 ty, or soundness of federally insured depository

17 institutions or any affiliate of such an institu18 tion (as defined in section 2(k) of the Bank

19 Holding Company Act of 1956 (12 U.S.C.

20 1841(k)); credit unions; the Federal Home

21 Loan Banks; government-sponsored housing en22 terprises; a Farm Credit System Institution;

23 foreign banks, and their branches, agencies,

24 commercial lending companies or representative

25 offices that operate in the United States and
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1 any affiliate of such foreign banks (as those

2 terms are defined in the International Banking

3 Act of 1978 (12 U.S.C. 3101)); or a rule relat4 ing to the payments system or the protection of

5 deposit insurance funds or Farm Credit Insur6 ance Fund;

7 ‘‘(F) a rule relating to the integrity of the

8 securities or commodities futures markets or to

9 the protection of investors in those markets;

10 ‘‘(G) a rule issued by the Federal Election

11 Commission or a rule issued by the Federal

12 Communications Commission under sections

13 312(a)(7) and 315 of the Communications Act

14 of 1934 (47 U.S.C. 312(a)(7) and 315);

15 ‘‘(H) a rule required to be promulgated at

16 least annually pursuant to statute;

17 ‘‘(I) a rule or agency action relating to the

18 public debt or fiscal policy of the United States;

19 or

20 ‘‘(J) a rule or agency action that author21 izes or bars the introduction into or removal

22 from commerce, or recognizes or cancels rec23 ognition of the marketable status, of a product

24 under the Federal Food, Drug and Cosmetic

25 Act (21 U.S.C. 301 et seq.); and
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1 ‘‘(11) the term ‘substitution risk’—

2 ‘‘(A) means a reasonably identifiable sig3 nificant increased risk to health, safety, or the

4 environment expected to result from a regu5 latory option; and

6 ‘‘(B) shall not include risks attributable to

7 the effect of an option on the income of individ8 uals.

9 ‘‘§ 622. Applicability and effect

10 ‘‘(a) Except as provided in section 623(f), this sub11 chapter shall apply to all proposed and final major rules.

12 ‘‘(b) Nothing in this subchapter shall be construed

13 to alter or modify—

14 ‘‘(1) the substantive standards applicable to a

15 rule making under other statutes;

16 ‘‘(2)(A) the range of regulatory options that an

17 agency has the authority to adopt under the statute

18 authorizing the agency to promulgate the rule; or

19 ‘‘(B) the deference otherwise accorded to the

20 agency in construing such statute; or

21 ‘‘(3) any opportunity for judicial review made

22 applicable under other statutes.

23 ‘‘§ 623. Regulatory analysis

24 ‘‘(a)(1) Before publishing a notice of a proposed rule

25 making for any rule, each agency shall determine whether
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1 the rule is or is not a major rule covered by this sub2 chapter.

3 ‘‘(2) The Director may designate any rule to be a

4 major rule under section 621(7)(B), if the Director—

5 ‘‘(A) makes such designation not later than 30

6 days after the close of the comment period for the

7 rule; and

8 ‘‘(B) publishes such designation in the Federal

9 Register, together with a succinct statement of the

10 basis for the designation, within 30 days after such

11 designation.

12 ‘‘(b)(1)(A) When an agency publishes a notice of pro13 posed rule making for a major rule, the agency shall—

14 ‘‘(i) prepare and place in the rule making file

15 an initial regulatory analysis; and

16 ‘‘(ii) include a summary of such analysis con17 sistent with subsection (e) in the notice of proposed

18 rule making.

19 ‘‘(B)(i) When the Director has published a designa20 tion that a rule is a major rule after the publication of

21 the notice of proposed rule making for the rule, the agency

22 shall—

23 ‘‘(I) promptly prepare and place in the rule

24 making file an initial regulatory analysis for the

25 rule; and
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1 ‘‘(II) publish in the Federal Register a sum2 mary of such analysis consistent with subsection (e).

3 ‘‘(ii) Following the issuance of an initial regulatory

4 analysis under clause (i), the agency shall give interested

5 persons an opportunity to comment under section 553 in

6 the same manner as if the initial regulatory analysis had

7 been issued with the notice of proposed rule making.

8 ‘‘(2) Each initial regulatory analysis shall contain—

9 ‘‘(A) a cost-benefit analysis of the proposed rule

10 that shall contain—

11 ‘‘(i) an analysis of the benefits of the pro12 posed rule, including any benefits that cannot

13 be quantified, and an explanation of how the

14 agency anticipates that such benefits will be

15 achieved by the proposed rule, including a de16 scription of the persons or classes of persons

17 likely to receive such benefits;

18 ‘‘(ii) an analysis of the costs of the pro19 posed rule, including any costs that cannot be

20 quantified, and an explanation of how the agen21 cy anticipates that such costs will result from

22 the proposed rule, including a description of the

23 persons or classes of persons likely to bear such

24 costs;
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1 ‘‘(iii) an evaluation of the relationship of

2 the benefits of the proposed rule to its costs, in3 cluding the determinations required under sub4 section (d), taking into account the results of

5 any risk assessment;

6 ‘‘(iv) an evaluation of the benefits and

7 costs of a reasonable number of reasonable al8 ternatives reflecting the range of regulatory op9 tions that would achieve the objective of the

10 statute as addressed by the rule making, includ11 ing, where feasible, alternatives that—

12 ‘‘(I) require no government action or

13 utilize voluntary programs;

14 ‘‘(II) provide flexibility for small enti15 ties under subchapter I and for State,

16 local, or tribal government agencies dele17 gated to administer a Federal program;

18 ‘‘(III) employ flexible regulatory op19 tions; and

20 ‘‘(IV) assure protection of sensitive

21 subpopulations, or populations exposed to

22 multiple and cumulative risks; and

23 ‘‘(v) a description of the scientific or eco24 nomic evaluations or information upon which

25 the agency substantially relied in the cost-ben-
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1 efit analysis and risk assessment required under

2 this subchapter, and an explanation of how the

3 agency reached the determinations under sub4 section (d);

5 ‘‘(B) if required, the risk assessment in accord6 ance with section 624; and

7 ‘‘(C) when scientific information on substitution

8 risks to health, safety, or the environment is reason9 ably available to the agency, an identification and

10 evaluation of such risks.

11 ‘‘(c)(1) When the agency publishes a final major rule,

12 the agency shall prepare and place in the rule making file

13 a final regulatory analysis.

14 ‘‘(2) Each final regulatory analysis shall address each

15 of the requirements for the initial regulatory analysis

16 under subsection (b)(2), revised to reflect—

17 ‘‘(A) any material changes made to the pro18 posed rule by the agency after publication of the no19 tice of proposed rule making;

20 ‘‘(B) any material changes made to the cost21 benefit analysis or risk assessment; and

22 ‘‘(C) agency consideration of significant com23 ments received regarding the proposed rule and the

24 initial regulatory analysis, including regulatory re25 view communications under subchapter IV.
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1 ‘‘(d)(1)(A) The agency shall include in the statement

2 of basis and purpose for a proposed or final major rule

3 a reasonable determination, based upon the rule making

4 record considered as a whole—

5 ‘‘(i) whether the rule is likely to provide bene6 fits that justify the costs of the rule;

7 ‘‘(ii) whether the rule is likely to substantially

8 achieve the rule making objective in a more cost-ef9 fective manner, or with greater net benefits, than

10 the other reasonable alternatives considered by the

11 agency; and

12 ‘‘(iii) whether the rule adopts a flexible regu13 latory option.

14 ‘‘(B) Consistent with section 621 (2) and (3), net

15 benefits analysis shall not be construed to be limited to

16 quantifiable effects.

17 ‘‘(2) If the agency head determines that the rule is

18 not likely to provide benefits that justify the costs of the

19 rule or is not likely to substantially achieve the rule mak20 ing objective in a more cost-effective manner, or with

21 greater net benefits, than the other reasonable alternatives

22 considered by the agency, the agency head shall—

23 ‘‘(A) explain the reasons for selecting the rule

24 notwithstanding such determination, including iden-
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1 tifying any statutory provision that required the

2 agency to select such rule;

3 ‘‘(B) describe any reasonable alternative consid4 ered by the agency that would be likely to provide

5 benefits that justify the costs of the rule and be like6 ly to substantially achieve the rule making objective

7 in a more cost-effective manner, or with greater net

8 benefits, than the alternative selected by the agency;

9 and

10 ‘‘(C) describe any flexible regulatory option con11 sidered by the agency and explain why that option

12 was not adopted by the agency if that option was

13 not adopted.

14 ‘‘(e) Each agency shall include an executive summary

15 of the regulatory analysis, including any risk assessment,

16 in the regulatory analysis and in the statement of basis

17 and purpose for the proposed and final major rule. Such

18 executive summary shall include a succinct presentation

19 of—

20 ‘‘(1) the benefits and costs expected to result

21 from the rule and any determinations required under

22 subsection (d);

23 ‘‘(2) if applicable, the risk addressed by the rule

24 and the results of any risk assessment;
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1 ‘‘(3) the benefits and costs of reasonable alter2 natives considered by the agency; and

3 ‘‘(4) the key assumptions and scientific or eco4 nomic information upon which the agency relied.

5 ‘‘(f)(1) A major rule may be adopted without prior

6 compliance with this subchapter if—

7 ‘‘(A) the agency for good cause finds that con8 ducting the regulatory analysis under this sub9 chapter before the rule becomes effective is impracti10 cable or contrary to an important public interest;

11 and

12 ‘‘(B) the agency publishes the rule in the Fed13 eral Register with such finding and a succinct expla14 nation of the reasons for the finding.

15 ‘‘(2) If a major rule is adopted under paragraph (1),

16 the agency shall comply with this subchapter as promptly

17 as possible unless the Director determines that compliance

18 would be clearly unreasonable.

19 ‘‘(g) Each agency shall develop an effective process

20 to permit elected officers of State, local, and tribal govern21 ments (or their designated employees with authority to act

22 on their behalf) to provide meaningful and timely input

23 in the development of regulatory proposals that contain

24 significant Federal intergovernmental mandates. The

25 process developed under this subsection shall be consistent
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1 with section 204 of the Unfunded Mandates Reform Act

2 of 1995 (2 U.S.C. 1534).

3 ‘‘§ 624. Principles for risk assessments

4 ‘‘(a)(1)(A) Subject to paragraph (2), each agency

5 shall design and conduct risk assessments in accordance

6 with this subchapter for—

7 ‘‘(i) each proposed and final major rule the pri8 mary purpose of which is to address health, safety,

9 or environmental risk; or

10 ‘‘(ii) any risk assessment that is not the basis

11 of a rule making that the Director—

12 ‘‘(I) reasonably anticipates is likely to have

13 an annual effect on the economy of

14 $100,000,000 or more in reasonably quantifi15 able costs; and

16 ‘‘(II) determines shall be subject to the re17 quirements of this section.

18 ‘‘(B)(i) Risk assessments conducted under this sub19 chapter shall be conducted in a manner that promotes ra20 tional and informed risk management decisions and in21 formed public input into and understanding of the process

22 of making agency decisions.

23 ‘‘(ii) The scope and level of analysis of such a risk

24 assessment shall be commensurate with the significance

25 and complexity of the decision and the need to adequately
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1 inform the public, consistent with any need for expedition,

2 and designed for the nature of the risk being assessed.

3 ‘‘(2) If a risk assessment under this subchapter is

4 otherwise required by this section, but the agency deter5 mines that—

6 ‘‘(A) a final rule subject to this subchapter is

7 substantially similar to the proposed rule with re8 spect to the risk being addressed;

9 ‘‘(B) a risk assessment for the proposed rule

10 has been carried out in a manner consistent with

11 this subchapter; and

12 ‘‘(C) a new risk assessment for the final rule is

13 not required in order to respond to comments re14 ceived during the period for comment on the pro15 posed rule,

16 the agency may publish such determination along with the

17 final rule in lieu of preparing a new risk assessment for

18 the final rule.

19 ‘‘(b) Each agency shall consider in each risk assess20 ment all relevant, reliable, and reasonably available sci21 entific information and shall describe the basis for select22 ing such scientific information.

23 ‘‘(c)(1) When a risk assessment involves a choice of

24 assumptions, the agency shall, with respect to significant

25 assumptions—
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1 ‘‘(A) identify the assumption and its scientific

2 and policy basis, including the extent to which the

3 assumption has been validated by, or conflicts with,

4 empirical data;

5 ‘‘(B) explain the basis for any choices among

6 assumptions and, where applicable, the basis for

7 combining multiple assumptions; and

8 ‘‘(C) describe reasonable alternative assump9 tions that—

10 ‘‘(i) would have had a significant effect on

11 the results of the risk assessment; and

12 ‘‘(ii) were considered but not selected by

13 the agency for use in the risk assessment.

14 ‘‘(2) Significant assumptions used in a risk assess15 ment shall incorporate all reasonably available, relevant,

16 and reliable scientific information.

17 ‘‘(d) The agency shall inform the public when the

18 agency is conducting a risk assessment subject to this sec19 tion and, to the extent practicable, shall solicit relevant

20 and reliable data from the public. The agency shall con21 sider such data in conducting the risk assessment.

22 ‘‘(e) Each risk assessment under this subchapter

23 shall include, as appropriate, each of the following:

24 ‘‘(1) A description of the hazard of concern.
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1 ‘‘(2) A description of the populations or natural

2 resources that are the subject of the risk assess3 ment.

4 ‘‘(3) An explanation of the exposure scenarios

5 used in the risk assessment, including an estimate of

6 the corresponding population or natural resource at

7 risk and the likelihood of such exposure scenarios.

8 ‘‘(4) A description of the nature and severity of

9 the harm that could reasonably occur as a result of

10 exposure to the hazard.

11 ‘‘(5) A description of the major uncertainties in

12 each component of the risk assessment and their in13 fluence on the results of the assessment.

14 ‘‘(f) To the extent scientifically appropriate, each

15 agency shall—

16 ‘‘(1) express the estimate of risk as 1 or more

17 reasonable ranges and, if feasible, probability dis18 tributions that reflects variabilities, uncertainties,

19 and lack of data in the analysis;

20 ‘‘(2) provide the ranges and distributions of

21 risks, including central and high end estimates of

22 the risks, and their corresponding exposure scenarios

23 for the potentially exposed population and, as appro24 priate, for more highly exposed or sensitive sub25 populations; and
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1 ‘‘(3) describe the qualitative factors influencing

2 the ranges, distributions, and likelihood of possible

3 risks.

4 ‘‘(g) When scientific information that permits rel5 evant comparisons of risk is reasonably available, each

6 agency shall use the information to place the nature and

7 magnitude of a risk to health, safety, or the environment

8 being analyzed in relationship to other reasonably com9 parable risks familiar to and routinely encountered by the

10 general public. Such comparisons should consider relevant

11 distinctions among risks, such as the voluntary or involun12 tary nature of risks, well understood or newly discovered

13 risks, and reversible or irreversible risks.

14 ‘‘§ 625. Peer review

15 ‘‘(a) Each agency shall provide for an independent

16 peer review in accordance with this section of—

17 ‘‘(1) a cost-benefit analysis of a major rule that

18 the agency or Director reasonably anticipates is like19 ly to have an annual effect on the economy of

20 $500,000,000 in reasonably quantifiable costs; and

21 ‘‘(2) a risk assessment required by this sub22 chapter.

23 ‘‘(b)(1) Peer review required under subsection (a)

24 shall—
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1 ‘‘(A) be conducted through panels, expert bod2 ies, or other formal or informal devices that are

3 broadly representative and involve participants—

4 ‘‘(i) with expertise relevant to the sciences,

5 or analyses involved in the regulatory decisions;

6 and

7 ‘‘(ii) who are independent of the agency;

8 ‘‘(B) be governed by agency standards and

9 practices governing conflicts of interest of non10 governmental agency advisors;

11 ‘‘(C) provide for the timely completion of the

12 peer review including meeting agency deadlines;

13 ‘‘(D) contain a balanced presentation of all con14 siderations, including minority reports and an agen15 cy response to all significant peer review comments;

16 and

17 ‘‘(E) provide adequate protections for confiden18 tial business information and trade secrets, including

19 requiring panel members or participants to enter

20 into confidentiality agreements.

21 ‘‘(2) Each agency shall provide a written response to

22 all significant peer review comments. All peer review com23 ments and any responses shall be made—

24 ‘‘(A) available to the public; and
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1 ‘‘(B) part of the rule making record for pur2 poses of judicial review of any final agency action.

3 ‘‘(3) If the head of an agency, with the concurrence

4 of the Director, publishes a determination in the rule mak5 ing file that a cost-benefit analysis or risk assessment, or

6 any component thereof, has been previously subjected to

7 adequate peer review, no further peer review shall be re8 quired under this section for such analysis, assessment,

9 or component.

10 ‘‘(c) For each peer review conducted by an agency

11 under this section, the agency head shall include in the

12 rule making record a statement by a Federal officer or

13 employee who is not an employee of the agency rule mak14 ing office or program—

15 ‘‘(1) whether the peer review participants re16 flect the independence and expertise required under

17 subsection (b)(1)(A); and

18 ‘‘(2) whether the agency has adequately re19 sponded to the peer review comments as required

20 under subsection (b)(2).

21 ‘‘(d) The formality of the peer review conducted

22 under this section shall be commensurate with the signifi23 cance and complexity of the subject matter.
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1 ‘‘(e) The peer review required by this section shall

2 not be subject to the Federal Advisory Committee Act (5

3 U.S.C. App.).

4 ‘‘(f) A member of an agency advisory board (or com5 parable organization) established by statute shall be con6 sidered independent of the agency for purposes of sub7 section (b)(1)(A)(ii).

8 ‘‘(g) The status of a person as a contractor or grantee

9 of the agency conducting the peer review shall not, in and

10 of itself, exclude such person from serving as a peer re11 viewer for such agency because of the requirement of sub12 section (b)(1)(A)(ii).

13 ‘‘(h) Nothing in this section shall require more than

14 one peer review of a cost-benefit analysis or a risk assess15 ment during a rule making. A peer review required by this

16 section shall occur to the extent feasible before the notice

17 of proposed rule making.

18 ‘‘§ 626. Deadlines for rule making

19 ‘‘(a) All statutory deadlines that require an agency

20 to propose or promulgate any major rule during the 2-

21 year period beginning on the effective date of this section

22 shall be suspended until the earlier of—

23 ‘‘(1) the date on which the requirements of this

24 subchapter are satisfied; or
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1 ‘‘(2) the date occurring 180 days after the date

2 of the applicable deadline.

3 ‘‘(b) In any proceeding involving a deadline imposed

4 by a court of the United States that requires an agency

5 to propose or promulgate any major rule during the 2-

6 year period beginning on the effective date of this section,

7 the United States shall request, and the court may grant,

8 an extension of such deadline until the earlier of—

9 ‘‘(1) the date on which the requirements of this

10 subchapter are satisfied; or

11 ‘‘(2) the date occurring 180 days after the date

12 of the applicable deadline.

13 ‘‘(c) In any case in which the failure to promulgate

14 a major rule by a deadline occurring during the 2-year

15 period beginning on the effective date of this section would

16 create an obligation to regulate through individual adju17 dications, the deadline shall be suspended until the earlier

18 of—

19 ‘‘(1) the date on which the requirements of this

20 subchapter are satisfied; or

21 ‘‘(2) the date occurring 180 days after the date

22 of the applicable deadline.

23 ‘‘§ 627. Judicial review

24 ‘‘(a) Compliance by an agency with the provisions of

25 this subchapter shall be subject to judicial review only—
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1 ‘‘(1) in connection with review of final agency

2 action;

3 ‘‘(2) in accordance with this section; and

4 ‘‘(3) in accordance with the limitations on tim5 ing, venue, and scope of review imposed by the stat6 ute authorizing judicial review.

7 ‘‘(b) Any determination of an agency whether a rule

8 is a major rule under section 621(7)(A) shall be set aside

9 by a reviewing court only upon a showing that the deter10 mination is arbitrary or capricious.

11 ‘‘(c) Any designation by the Director that a rule is

12 a major rule under section 621(7), or any failure to make

13 such designation, shall not be subject to judicial review.

14 ‘‘(d) The cost-benefit analysis, cost-benefit deter15 mination under section 623(d), and any risk assessment

16 required under this subchapter shall not be subject to judi17 cial review separate from review of the final rule to which

18 such analysis or assessment applies. The cost-benefit anal19 ysis, cost-benefit determination under section 623(d), and

20 any risk assessment shall be part of the rule making

21 record and shall be considered by a court to the extent

22 relevant, only in determining under the statute granting

23 the rule making authority whether the final rule is arbi24 trary, capricious, an abuse of discretion, or is unsupported
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1 by substantial evidence where that standard is otherwise

2 provided by law.

3 ‘‘(e) If an agency fails to perform the cost-benefit

4 analysis, cost-benefit determination, or risk assessment, or

5 to provide for peer review, a court may, giving due regard

6 to prejudicial error, remand or invalidate the rule. The

7 adequacy of compliance with the specific requirements of

8 this subchapter shall not otherwise be grounds for re9 manding or invalidating a rule under this subchapter. If

10 the court allows the rule to take effect, the court shall

11 order the agency to promptly perform such analysis, deter12 mination, or assessment or provide for such peer review.

13 ‘‘§ 628. Guidelines, interagency coordination, and re14 search

15 ‘‘(a)(1) Not later than 270 days after the date of en16 actment of this section, the Director, in consultation with

17 the Council of Economic Advisors, the Director of the Of18 fice of Science and Technology Policy, and relevant agency

19 heads, shall issue guidelines for cost-benefit analyses, risk

20 assessments, and peer reviews as required by this sub21 chapter. The Director shall oversee and periodically revise

22 such guidelines as appropriate.

23 ‘‘(2) As soon as practicable and not later than 18

24 months after issuance of the guidelines required under

25 paragraph (1), each agency subject to section 624 shall
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1 adopt detailed guidelines for risk assessments as required

2 by this subchapter. Such guidelines shall be consistent

3 with the guidelines issued under paragraph (1). Each

4 agency shall periodically revise such agency guidelines as

5 appropriate.

6 ‘‘(3) The guidelines under this subsection shall be de7 veloped following notice and public comment. The develop8 ment and issuance of the guidelines shall not be subject

9 to judicial review, except in accordance with section

10 706(1).

11 ‘‘(b) To promote the use of cost-benefit analysis and

12 risk assessment in a consistent manner and to identify

13 agency research and training needs, the Director, in con14 sultation with the Council of Economic Advisors and the

15 Director of the Office of Science and Technology Policy,

16 shall—

17 ‘‘(1) oversee periodic evaluations of Federal

18 agency cost-benefit analysis and risk assessment;

19 ‘‘(2) provide advice and recommendations to the

20 President and Congress to improve agency use of

21 cost-benefit analysis and risk assessment;

22 ‘‘(3) utilize appropriate interagency mechanisms

23 to improve the consistency and quality of cost-ben24 efit analysis and risk assessment among Federal

25 agencies; and
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1 ‘‘(4) utilize appropriate mechanisms between

2 Federal and State agencies to improve cooperation

3 in the development and application of cost-benefit

4 analysis and risk assessment.

5 ‘‘(c)(1) The Director, in consultation with the head

6 of each agency, the Council of Economic Advisors, and the

7 Director of the Office of Science and Technology Policy,

8 shall periodically evaluate and develop a strategy to meet

9 agency needs for research and training in cost-benefit

10 analysis and risk assessment, including research on model11 ling, the development of generic data, use of assumptions

12 and the identification and quantification of uncertainty

13 and variability.

14 ‘‘(2)(A) Not later than 180 days after the date of

15 enactment of this section, the Director, in consultation

16 with the Director of the Office of Science and Technology

17 Policy, shall enter a contract with an accredited scientific

18 institution to conduct research to—

19 ‘‘(i) develop a common basis to assist risk com20 munication related to both carcinogens and non21 carcinogens; and

22 ‘‘(ii) develop methods to appropriately incor23 porate risk assessments into related cost-benefit

24 analyses.
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1 ‘‘(B) Not later than 2 years after the date of enact2 ment of this section, the results of the research conducted

3 under this paragraph shall be submitted to the Director

4 and Congress.

5 ‘‘§ 629. Risk based priorities study

6 ‘‘(a) Not later than 1 year after the date of enact7 ment of this section, the Director, in consultation with the

8 Director of the Office of Science and Technology Policy,

9 shall enter into a contract with an accredited scientific in10 stitution to conduct a study that provides—

11 ‘‘(1) a systematic comparison of the extent and

12 severity of significant risks to human health, safety,

13 or the environment (hereafter referred to as a com14 parative risk analysis);

15 ‘‘(2) a study of methodologies for using com16 parative risk analysis to compare dissimilar risks to

17 human health, safety, or the environment, including

18 development of a common basis to assist compara19 tive risk analysis related to both carcinogens and

20 noncarcinogens; and

21 ‘‘(3) recommendations on the use of compara22 tive risk analysis in setting priorities for the reduc23 tion of risks to human health, safety, or the environ24 ment.
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1 ‘‘(b) The Director shall ensure that the study re2 quired under subsection (a) is—

3 ‘‘(1) conducted through an open process pro4 viding peer review consistent with section 625 and

5 opportunities for public comment and participation;

6 and

7 ‘‘(2) not later than 3 years after the date of en8 actment of this section, completed and submitted to

9 Congress and the President.

10 ‘‘(c) Not later than 4 years after the date of enact11 ment of this section, each relevant agency shall, as appro12 priate, use the results of the study required under sub13 section (a) to inform the agency in the preparation of the

14 agency’s annual budget and strategic plan and perform15 ance plan under section 306 of this title and sections

16 1115, 1116, 1117, 1118, and 1119 of title 31.

17 ‘‘(d) Not later than 5 years after the date of enact18 ment of this section, and periodically thereafter, the Presi19 dent shall submit a report to Congress recommending leg20 islative changes to assist in setting priorities to more effec21 tively and efficiently reduce risks to human health, safety,

22 or the environment.

23 ‘‘SUBCHAPTER III—EXECUTIVE OVERSIGHT

24 ‘‘§ 631. Definitions

25 ‘‘For purposes of this subchapter—
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1 ‘‘(1) the definitions under sections 551 and 621

2 shall apply; and

3 ‘‘(2) the term ‘regulatory action’ means any one

4 of the following:

5 ‘‘(A) Advance notice of proposed rule mak6 ing.

7 ‘‘(B) Notice of proposed rule making.

8 ‘‘(C) Final rule making, including interim

9 final rule making.

10 ‘‘§ 632. Presidential regulatory review

11 ‘‘(a) This subchapter shall apply to all proposed and

12 final major rules and to any other rules designated by the

13 President for review.

14 ‘‘(b) The President shall establish a process for the

15 review and coordination of Federal agency regulatory ac16 tions. Such process shall be the responsibility of the Direc17 tor.

18 ‘‘(c) For the purpose of carrying out subsection (c),

19 the Director shall—

20 ‘‘(1) develop and oversee uniform regulatory

21 policies and procedures, including those by which

22 each agency shall comply with the requirements of

23 this chapter;

24 ‘‘(2) develop policies and procedures for the re25 view of regulatory actions by the Director; and
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1 ‘‘(3) develop and oversee an annual govern2 mentwide regulatory planning process that shall in3 clude review of planned significant regulatory ac4 tions and publication of—

5 ‘‘(A) a summary of and schedule for pro6 mulgation of planned agency major rules;

7 ‘‘(B) agency specific schedules for review

8 of existing rules, including under section 610;

9 ‘‘(C) a summary of regulatory review ac10 tions undertaken in the prior year;

11 ‘‘(D) a list of major rules promulgated in

12 the prior year for which an agency could not

13 make the determinations that the benefits of a

14 rule justify the costs under section 623(d);

15 ‘‘(E) identification of significant agency

16 noncompliance with this chapter in the prior

17 year; and

18 ‘‘(F) recommendations for improving com19 pliance with this chapter and increasing the ef20 ficiency and effectiveness of the regulatory

21 process.

22 ‘‘(d)(1) The review established under subsection (b)

23 shall be conducted as expeditiously as practicable and shall

24 be limited to not more than 90 days.
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1 ‘‘(2) A review may be extended longer than the 90-

2 day period referred to under paragraph (1) by the Direc3 tor or at the request of the rule making agency to the

4 Director. Notice of such extension shall be published

5 promptly in the Federal Register.

6 ‘‘§ 633. Public disclosure of information

7 ‘‘(a) The Director, in carrying out section 632, shall

8 establish procedures to provide public and agency access

9 to information concerning review of regulatory actions

10 under this subchapter, including—

11 ‘‘(1) disclosure to the public on an ongoing

12 basis of information regarding the status of regu13 latory actions undergoing review;

14 ‘‘(2) disclosure to the public, not later than the

15 date of publication of a regulatory action, of—

16 ‘‘(A) all written correspondence relating to

17 the substance of a regulatory action, including

18 drafts of all proposals and associated analyses,

19 between the Administrator or employees of the

20 Administrator and the regulatory agency;

21 ‘‘(B) all written correspondence relating to

22 the substance of a regulatory action between

23 the Administrator or employees of the Adminis24 trator and any person not employed by the ex25 ecutive branch of the Federal Government; and
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1 ‘‘(C) a list identifying the dates, names of

2 individuals involved, and subject matter dis3 cussed in significant meetings and telephone

4 conversations relating to the substance of a reg5 ulatory action between the Administrator or

6 employees of the Administrator and any person

7 not employed by the executive branch of the

8 Federal Government; and

9 ‘‘(3) disclosure to the regulatory agency, on a

10 timely basis, of—

11 ‘‘(A) all written correspondence relating to

12 the substance of a regulatory action between

13 the Administrator or employees of the Adminis14 trator and any person not employed by the ex15 ecutive branch of the Federal Government; and

16 ‘‘(B) a list identifying the dates, names of

17 individuals involved, and subject matter dis18 cussed in significant meetings and telephone

19 conversations relating to the substance of a reg20 ulatory action between the Administrator or

21 employees of the Administrator and any person

22 not employed by the executive branch of the

23 Federal Government.

24 ‘‘(b) Before the publication of any proposed or final

25 rule, the agency shall include in the rule making record—
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1 ‘‘(1) a document identifying in a complete,

2 clear, and simple manner, the substantive changes

3 between the draft submitted to the Administrator for

4 review and the rule subsequently published;

5 ‘‘(2) a document identifying and describing

6 those substantive changes in the rule that were

7 made as a result of the regulatory review and a

8 statement if the Administrator suggested or rec9 ommended no changes; and

10 ‘‘(3) all written correspondence relating to the

11 substance of a regulatory action between the Admin12 istrator and the agency during the review of the

13 rule, including drafts of all proposals and associated

14 analyses.

15 ‘‘(c) In any meeting relating to the substance of a

16 regulatory action under review between the Administrator

17 or employees of the Administrator and any person not em18 ployed by the executive branch of the Federal Government,

19 a representative of the agency submitting the regulatory

20 action shall be invited.

21 ‘‘§ 634. Judicial review

22 ‘‘The exercise of the authority granted under this

23 subchapter by the President, the Director, or the Adminis24 trator shall not be subject to judicial review in any man25 ner.’’.
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1 (b) PRESIDENTIAL AUTHORITY.—Nothing in this Act

2 shall limit the exercise by the President of the authority

3 and responsibility that the President otherwise possesses

4 under the Constitution and other laws of the United

5 States with respect to regulatory policies, procedures, and

6 programs of departments, agencies, and offices.

7 (c) TECHNICAL AND CONFORMING AMENDMENTS.—

8 (1) TABLE OF SECTIONS.—Part I of title 5,

9 United States Code, is amended by striking the

10 chapter heading and table of sections for chapter 6

11 and inserting the following:

12 ‘‘CHAPTER 6—THE ANALYSIS OF

13 REGULATORY FUNCTIONS

‘‘SUBCHAPTER I—ANALYSIS OF REGULATORY FLEXIBILITY

‘‘Sec.

‘‘601. Definitions.

‘‘602. Regulatory agenda.

‘‘603. Initial regulatory flexibility analysis.

‘‘604. Final regulatory flexibility analysis.

‘‘605. Avoidance of duplicative or unnecessary analyses.

‘‘606. Effect on other law.

‘‘607. Preparation of analysis.

‘‘608. Procedure for waiver or delay of completion.

‘‘609. Procedures for gathering comments.

‘‘610. Periodic review of rules.

‘‘611. Judicial review.

‘‘612. Reports and intervention rights.

‘‘SUBCHAPTER II—REGULATORY ANALYSIS

‘‘621. Definitions.

‘‘622. Applicability and effect.

‘‘623. Regulatory analysis.

‘‘624. Principles for risk assessments.

‘‘625. Peer review.

‘‘626. Deadlines for rule making.

‘‘627. Judicial review.

‘‘628. Guidelines, interagency coordination, and research.

‘‘629. Risk based priorities study.
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‘‘SUBCHAPTER III—EXECUTIVE OVERSIGHT

‘‘631. Definitions.

‘‘632. Presidential regulatory review.

‘‘633. Public disclosure of information.

‘‘634. Judicial review.’’.

1 (2) SUBCHAPTER HEADING.—Chapter 6 of title

2 5, United States Code, is amended by inserting im3 mediately before section 601, the following sub4 chapter heading:

5 ‘‘SUBCHAPTER I—ANALYSIS OF REGULATORY

6 FLEXIBILITY’’.

7 SEC. 4. COMPLIANCE WITH THE UNFUNDED MANDATES RE8 FORM ACT OF 1995.

9 Compliance with the requirements of subchapter II

10 of chapter 6 of title 5, United States Code (as added by

11 section 3 of this Act), shall constitute compliance with the

12 requirements pertaining to the costs and benefits of a Fed13 eral mandate to the private sector in sections 202,

14 205(a)(2), and 208 of the Unfunded Mandates Reform

15 Act of 1995 (2 U.S.C. 1532, 1535(a)(2), and 1538).

16 SEC. 5. EFFECTIVE DATE.

17 Except as otherwise provided in this Act, this Act

18 shall take effect 180 days after the date of enactment of

19 this Act, but shall not apply to any agency rule for which

20 a notice of proposed rule making is published on or before

21 60 days before the date of enactment of this Act.

Æ