[Federal Register Volume 62, Number 52 (Tuesday, March 18, 1997)]
[Notices]
[Pages 12820-12821]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-6781]


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DEPARTMENT OF ENERGY
Office of General Counsel


Unfunded Mandates Reform Act; Intergovernmental Consultation

AGENCY: Office of the General Counsel, Department of Energy.

ACTION: Notice of final statement of policy.

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SUMMARY: The Department of Energy (DOE) today publishes a final 
statement of policy on intergovernmental consultation under the 
Unfunded Mandates Reform Act of 1995. The policy reflects the 
guidelines and instructions that the Director of the Office of 
Management and Budget (OMB) provided to each agency to develop, with 
input from State, local, and tribal officials, an intergovernmental 
consultation process with regard to significant intergovernmental 
mandates contained in a notice of proposed rulemaking.

EFFECTIVE DATE: This policy is effective March 18, 1997.

FOR FURTHER INFORMATION CONTACT: Steve Duarte, Office of the Assistant 
General Counsel for Regulatory Law, U.S. Department of Energy, 1000 
Independence Avenue, S.W., Washington, DC 20585, (202) 586-9507.

SUPPLEMENTARY INFORMATION: Section 203 of the Unfunded Mandates Reform 
Act of 1995 (the Act), 2 U.S.C. 1533, requires that, prior to 
establishing regulatory requirements that might significantly or 
uniquely affect small governments, the agency shall have developed a 
plan that, among other things, provides for notice to potentially 
affected small governments, if any, and for a meaningful and timely 
opportunity to provide input in the development of regulatory 
proposals. Section 204(a) of the Act requires each agency to develop, 
to the extent permitted by law, an effective process to permit timely 
input by elected officers (or their designees) of State, local, and 
tribal governments in the development of a regulatory proposal 
containing a proposed ``significant intergovernmental mandate'' that is 
not a requirement specifically set forth in law. 2 U.S.C. 1531, 
1534(a).
    A ``significant intergovernmental mandate'' under the Act is any 
provision in a Federal agency regulation that: (1) Would impose an 
enforceable duty upon State, local, or tribal governments (except as a 
condition of Federal assistance); and (2) may result in the expenditure 
by State, local, and tribal governments, in the aggregate, of $100 
million (adjusted annually for inflation) in any one year. See 2 U.S.C. 
658(5)(A)(i), 1532(a). The Act defines ``small government'' to mean any 
small governmental jurisdiction defined in the Regulatory Flexibility 
Act, 5 U.S.C. 601(5), and any tribal government. 2 U.S.C. 658(11).
    In January 1996, DOE published a notice of a proposed policy to 
implement this portion of the Act and the OMB guidelines and 
instructions published on September 29, 1995 (60 FR 50651) that deal 
with the intergovernmental consultation process. DOE sought public 
comment on the proposed policy in order to give State, local and tribal 
officials, as well as members of the public, an opportunity to comment 
on the policy before it was finalized. DOE received comments from one 
commenter. The DOE reviewed the comments and has determined to finalize 
the proposed policy with the modifications as described below.
    The commenter suggested that indirect notification to local elected 
officials (or their designees) through the National League of Cities, 
the National Association of Counties, and the U.S. Conference of Mayors 
may not provide notification to those local elected officials who are 
not members of these national organizations. The commenter suggested 
that DOE also notify the State Municipal Leagues. DOE has decided to 
implement this suggestion in the following manner. DOE understands that 
a number of the State Municipal Leagues are members of, and are 
represented by, one or another of the named national organizations. DOE 
will notify directly the State Municipal Leagues that are not otherwise 
represented by one of the named national organizations.
    The commenter suggested that, in determining if an unfunded mandate 
triggers the $100 million threshold, the DOE should not discount future 
costs to present value. After consulting with OMB, DOE has accepted 
this suggestion.
    The commenter also suggested that DOE open the consultation process 
whenever a DOE rule would create an unfunded mandate, without regard 
for the cost of the mandate. DOE has not accepted this suggestion 
because the Act provides otherwise, and in any event, issues about a 
proposed mandate could be presented during the comment period provided 
in the notice of proposed rulemaking. The Act assigns to the agency the 
obligation to assess the effects of Federal regulatory actions on 
State, local and tribal governments. 2 U.S.C. 1531. The Act requires 
that the agency permit State, local, and tribal governments to provide 
input in the development of regulatory proposals when the regulatory 
proposals contain significant Federal intergovernmental mandates. 2 
U.S.C. 1534. If the agency finds that the unfunded mandate does not 
rise to the level of a ``significant intergovernmental mandate'' under 
the Act, then the consultation process is not required. However, such a 
finding would not preclude a State, local, or tribal government from 
commenting in a public hearing or in a meeting with agency officials on 
a proposed intergovernmental mandate that is below the threshold of a 
``significant intergovernmental mandate.'
    Finally, the commenter suggested that DOE create a review process 
whereby local government officials can petition to have DOE's threshold 
determination reviewed by a ``neutral party.'' DOE has not accepted 
this suggestion because the Act specifically provides for judicial 
review. 2 U.S.C. 1571.
    In accordance with section 801 of the Small Business Regulatory 
Enforcement Act of 1996, 5 U.S.C. 801, DOE will report to Congress the 
promulgation of this Statement of Policy prior to its effective date.

    Issued in Washington, DC, on March 11, 1997.
Mary Anne Sullivan,
Acting General Counsel.

    On the basis of the foregoing, DOE adopts the following Statement 
of Policy:

Statement of Policy on the Process for Intergovernmental Consultation 
Under the Unfunded Mandates Reform Act of 1995

I. Purpose

    This Statement of Policy implements sections 203 and 204 of the 
Unfunded Mandates Reform Act of 1995 (Act), 2 U.S.C. 1533, 1534, 
consistent with the guidelines and instructions of the Director of the 
Office of Management and Budget (OMB).

II. Applicability

    This Statement of Policy applies to the development of any 
regulation (other than a regulation for a financial assistance program) 
containing a significant intergovernmental mandate under the Act. A 
significant intergovernmental mandate is a mandate that: (1) Would 
impose an enforceable duty upon State, local, or tribal governments 
(except as a condition of Federal assistance); and (2)

[[Page 12821]]

may result in the expenditure by State, local, and tribal governments, 
in the aggregate, of $100 million (adjusted annually for inflation) in 
any one year. DOE officials may apply this Statement of Policy 
selectively if there is an exigent need for immediate agency action 
that would warrant waiver of prior notice and opportunity for public 
comment under the Administrative Procedure Act, 5 U.S.C. 553.

III. Intergovernmental Consultation

    When to begin. As early as possible in the development of a notice 
of proposed rulemaking (for other than a financial assistance program) 
that involves an enforceable duty on State, local, or tribal 
governments, the responsible Secretarial Officer, with the concurrence 
of the Assistant Secretary for Policy and the General Counsel, should 
estimate whether the aggregate compliance expenditures will be in the 
amount of $100 million or more in any one year. In making such an 
estimate, the Secretarial Officer ordinarily should adjust the $100 
million figure in years after 1995 using the Gross Domestic Product 
deflator as contained in the Annual Report of the Counsel of Economic 
Advisors which is part of the Economic Report of the President.
    Content of notice. Upon determining that a proposed regulatory 
mandate on State, local, or tribal governments may be a significant 
intergovernmental mandate, the Secretarial Officer responsible for the 
rulemaking should provide adequate notice to pertinent State, local and 
tribal officials: (1) Describing the nature and authority for the 
rulemaking; (2) explaining DOE's estimate of the resulting increase in 
their governmental expenditure level; (3) inviting them to participate 
in the development of the notice of proposed rulemaking by 
participating in meetings with DOE or by presenting their views in 
writing on the likely effects of the regulatory requirement or legally 
available policy alternatives that DOE should take into account. If DOE 
publishes an advance notice of proposed rulemaking, then these issues 
may be addressed in that advance notice.
    How to notify State and tribal officials. With respect to State and 
tribal governments, actual notice should be given by letter, using a 
mailing list maintained by the DOE Office of Intergovernmental and 
External Affairs that includes elected chief executives (or their 
designees), chief financial officers (or their designees), the National 
Governors Association, and the National Congress of American Indians. 
The Secretarial Officer also should provide notice in the Federal 
Register.
    How to notify local officials. With respect to local governments, 
the Secretarial Officer should provide notice through the Federal 
Register and by letter to the National League of Cities, the National 
Association of Counties, the U.S. Conference of Mayors, and any State 
Municipal League not represented by a national association. If a 
significant intergovernmental mandate might affect local governments in 
a limited area of the United States, then the Secretarial Officer, in 
consultation with the Office of Intergovernmental and External Affairs, 
should give actual notice by letter to appropriate local officials if 
practicable.
    Exemption from the Federal Advisory Committee Act. Secretarial 
Officers are encouraged to meet with State, local, and tribal elected 
officials (or their designees) to exchange views, information, and 
advice concerning the implementation of intergovernmental 
responsibilities or administration. Section 204(b) of the Act, 2 U.S.C. 
1534(b), exempts from the Federal Advisory Committee Act (5 U.S.C. 
App.) meetings for this purpose that do not include other members of 
the public.
    Small government consultation plan. If the proposed regulatory 
requirements might significantly or uniquely affect small governments, 
then the Secretarial Officer should summarize in the Supplementary 
Information section of the notice of proposed rulemaking its plan for 
intergovernmental consultation under section 203 of the Act. Unless 
impracticable, the plan should provide for actual notice by letter to 
potentially affected small governments.
    Documenting compliance. The Supplementary Information section of 
any notice of proposed and final rulemaking involving a significant 
intergovernmental mandate upon State, local, or Indian tribal 
governments should describe DOE's determinations and compliance 
activities under the Act. The Supplementary Information section of the 
notice of proposed rulemaking should describe the estimated impact of 
an intergovernmental mandate, the assumptions underlying its 
calculation, and the resulting determination of whether the rulemaking 
involves a significant intergovernmental mandate. It should discuss, as 
appropriate, cost and benefit estimates and any reasonable suggestions 
received during pre-notice intergovernmental consultations. Any 
substantive pre-notice written communications should be described in 
the Supplementary Information and made available for inspection in the 
public rulemaking file in the DOE Freedom of Information Reading Room.
    Reporting. Pursuant to the OMB guidelines and instructions, the 
Office of General Counsel, with the cooperation of the Secretarial 
Officers, will prepare the annual report to OMB on compliance with the 
intergovernmental consultation requirements of the Act (initially due 
on January 15, 1996, and annually on January 15 thereafter).

[FR Doc. 97-6781 Filed 3-17-97; 8:45 am]
BILLING CODE 6450-01-P