II 

113TH CONGRESS 

2D SESSION S. 2988 

To amend the Congressional Budget Act of 1974 to establish a Federal 

regulatory budget and to impose cost controls on that budget, and 

for other purposes. 

IN THE SENATE OF THE UNITED STATES 

DECEMBER 8, 2014 

Mr. LEE introduced the following bill; which was read twice and referred to 

the Committee on Homeland Security and Governmental Affairs 

A BILL 

To amend the Congressional Budget Act of 1974 to establish 

a Federal regulatory budget and to impose cost controls 

on that budget, 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 ‘‘Regulatory Cost As5 sessment Act of 2014’’. 


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1 SEC. 2. AMENDMENTS TO THE CONGRESSIONAL BUDGET 

2 ACT OF 1974. 

3 (a) FEDERAL REGULATORY BUDGET COST CONTROL

4 SYSTEM.—Title III of the Congressional Budget Act of 

5 1974 is amended— 

6 (1) by inserting before section 300 the fol7 lowing: 

8 ‘‘PART A—GENERAL PROVISIONS’’; 

9 and 

10 (2) by adding at the end the following new part: 

11 ‘‘PART B—FEDERAL REGULATORY BUDGET COST 

12 CONTROL 

13 ‘‘SEC. 321. DEFINITIONS. 

14 ‘‘In this part— 

15 ‘‘(1) the term ‘CBO’ means the Congressional 

16 Budget Office; 

17 ‘‘(2) the term ‘direct cost of Federal regulation’ 

18 means all costs incurred by, and expenditures re19 quired of, the Federal Government in issuing and 

20 enforcing Federal regulations, rules, statements, and 

21 legislation; 

22 ‘‘(3) the term ‘Federal regulation, rule, state23 ment, or legislation’— 

24 ‘‘(A) includes any guidance document 

25 issued after notice and an opportunity for com26 ment in accordance with the requirements for 


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1 the promulgation of a rule under chapter 5 of 

2 title 5, United States Code; and 

3 ‘‘(B) does not include a Federal regulation, 

4 rule, statement, or legislation applying to— 

5 ‘‘(i) the military; or 

6 ‘‘(ii) agency organization, manage7 ment, or personnel; 

8 ‘‘(4) the term ‘Federal regulatory cost’— 

9 ‘‘(A) means all costs incurred by, and ex10 penditures required of, the private sector in 

11 complying with any Federal regulation, rule, 

12 statement, or legislation; and 

13 ‘‘(B) does not include the value of any ben14 efit under the Federal regulation, rule, state15 ment, or legislation; 

16 ‘‘(5) the term ‘gross domestic product’ means 

17 the gross domestic product of the United States dur18 ing a fiscal year, consistent with Department of 

19 Commerce definitions; 

20 ‘‘(6) the term ‘OMB’ means the Office of Man21 agement and Budget; and 

22 ‘‘(7) the term ‘regulatory baseline’ means the 

23 projection described in section 323(a) of the Federal 

24 regulatory cost for the fiscal year after the date of 

25 the projection and the outyears. 


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1 ‘‘SEC. 322. OMB–CBO REPORTS. 

2 ‘‘Not later than 1 year after the date of enactment 

3 of this section, and not later than September 15th of each 

4 odd-numbered year thereafter, OMB and CBO shall joint5 ly submit to the President, the Senate, and the House of 

6 Representatives a report that includes— 

7 ‘‘(1) a projection of the direct cost of Federal 

8 regulation and the Federal regulatory cost for the 

9 first fiscal year beginning after the date of the re10 port and at least each of the 4 ensuing fiscal years; 

11 ‘‘(2) a calculation of the estimated direct cost 

12 of Federal regulation and Federal regulatory cost as 

13 a percentage of the gross domestic product; 

14 ‘‘(3) the reduction in estimated gross domestic 

15 product attributable to private sector compliance 

16 with all Federal regulations, rules, statements, or 

17 legislation; 

18 ‘‘(4) a detailed description of the effect on the 

19 economy of the United States of Federal regulations, 

20 rules, statements, and legislation, which shall be cat21 egorized as relating to— 

22 ‘‘(A) regulation of the economy; 

23 ‘‘(B) security, including homeland security; 

24 ‘‘(C) the environment; 

25 ‘‘(D) health and safety; or 

26 ‘‘(E) the Federal budget; 


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1 ‘‘(5) a discussion of the expected reduction in 

2 personnel, administrative overhead, and pro3 grammatic costs that would be achieved by Federal 

4 agencies that issue regulations, rules, or statements 

5 with a Federal regulatory cost if the Federal agen6 cies reduced the Federal regulatory cost by 5 per7 cent; and 

8 ‘‘(6) recommendations for budgeting, technical, 

9 and estimating changes to improve the Federal regu10 latory budgeting process. 

11 ‘‘SEC. 323. REGULATORY BASELINE. 

12 ‘‘(a) IN GENERAL.—For the first fiscal year that be13 gins at least 120 days after the date of enactment of this 

14 section and for every second fiscal year thereafter, CBO, 

15 in consultation with OMB, shall submit to the President, 

16 the Senate, and the House of Representatives a regulatory 

17 baseline, consisting of a projection of the Federal regu18 latory cost for the fiscal year and at least each of the 4 

19 ensuing fiscal years. In preparing the projection of the 

20 regulatory baseline under this subsection, for the second 

21 fiscal year covered under the projection and each fiscal 

22 year thereafter, CBO shall adjust the baseline for the esti23 mated growth during that fiscal year in the gross domestic 

24 product. 


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1 ‘‘(b) DEADLINES.—The CBO shall submit the regu2 latory baselines required under subsection (a)— 

3 ‘‘(1) for the first regulatory baseline, not later 

4 than 30 days after the date of enactment of this sec5 tion; and 

6 ‘‘(2) for the second regulatory baseline and 

7 each regulatory baseline thereafter, not later than 

8 September 15 of the fiscal year before the first fiscal 

9 year covered under the regulatory baseline. 

10 ‘‘SEC. 324. ESTABLISHMENT OF LEVEL AND ALLOCATIONS. 

11 ‘‘(a) ESTABLISHMENT OF LEVEL.— 

12 ‘‘(1) IN GENERAL.—In addition to the require13 ments under section 301, a concurrent resolution on 

14 the budget for a fiscal year shall set forth the appro15 priate level for the Federal regulatory cost for the 

16 fiscal year and for at least each of the 4 ensuing fis17 cal years. 

18 ‘‘(2) DEFAULT TOTAL.—If there is not a level 

19 for the Federal regulatory cost that is in effect for 

20 a fiscal year under a concurrent resolution on the 

21 budget— 

22 ‘‘(A) for the first fiscal year that begins at 

23 least 120 days after the date of enactment of 

24 this section, the appropriate level for the Fed25 eral regulatory cost for the fiscal year shall be 


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1 the amount of the first regulatory baseline sub2 mitted under section 323; and 

3 ‘‘(B) for each fiscal year after the fiscal 

4 year described in subparagraph (A), the appro5 priate level for the Federal regulatory cost for 

6 the fiscal year shall be the level for the most re7 cent fiscal year for which such a level was in ef8 fect (under subparagraph (A), this subpara9 graph, or a concurrent resolution on the budg10 et). 

11 ‘‘(b) ALLOCATION OF TOTALS.— 

12 ‘‘(1) IN GENERAL.—For the first fiscal year 

13 that begins at least 120 days after the date of enact14 ment of this section, and each fiscal year thereafter, 

15 the Committee on the Budget of the Senate and the 

16 Committee on the Budget of the House of Rep17 resentatives shall each allocate among each com18 mittee of its House and by major functional category 

19 the Federal regulatory cost in effect under sub20 section (a) for such fiscal year and at least each of 

21 the 4 ensuing fiscal years. 

22 ‘‘(2) SUBALLOCATIONS.—As soon as practicable 

23 after receiving an allocation under paragraph (1), 

24 each committee shall subdivide its allocation among 


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1 its subcommittees or among programs over which 

2 the committee has jurisdiction. 

3 ‘‘(c) POINT OF ORDER.— 

4 ‘‘(1) IN GENERAL.—It shall not be in order in 

5 the Senate or the House of Representatives to con6 sider any bill or resolution, or amendment thereto, 

7 which would cause an allocation or suballocation of 

8 the Federal regulatory cost made under subsection 

9 (b) for a fiscal year to be exceeded. 

10 ‘‘(2) WAIVER.—A point of order under para11 graph (1) may only be waived by the affirmative 

12 vote of three-fifths of the Members, duly chosen and 

13 sworn. 

14 ‘‘(d) DETERMINATIONS BY BUDGET COMMITTEES.— 

15 For purposes of this section, the amount of the Federal 

16 regulatory cost for a fiscal year and the amount of the 

17 Federal regulatory cost of a bill or resolution, or amend18 ment thereto, shall be determined by the Committee on 

19 the Budget of the Senate or the Committee on the Budget 

20 of the House of Representatives, as the case may be. 

21 ‘‘SEC. 325. ANALYSIS OF FEDERAL REGULATORY COST BY 

22 CONGRESSIONAL BUDGET OFFICE. 

23 ‘‘(a) IN GENERAL.—CBO shall prepare for each bill 

24 or resolution of a public character reported by any com25 mittee of the Senate or the House of Representatives (exVerDate Sep 11 2014 02:10 Dec 09, 2014 Jkt 049200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S2988.IS S2988

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1 cept the Committee on Appropriations of each House), 

2 and submit to such committee— 

3 ‘‘(1) an estimate of the costs which would be in4 curred by the private sector in carrying out or com5 plying with such bill or resolution in the fiscal year 

6 in which it is to become effective and in each of the 

7 4 fiscal years following such fiscal year, which shall 

8 include a discussion of the methodology used to pre9 pare, and the basis for, each such estimate; and 

10 ‘‘(2) a comparison of the estimate of costs de11 scribed in paragraph (1) with any available esti12 mates of costs made by such committee or by any 

13 Federal agency. 

14 ‘‘(b) LOOK-BACK REVIEWS.—CBO shall periodically 

15 submit to Congress a report that— 

16 ‘‘(1) reviews a sample of laws of a public char17 acter for which an estimate was prepared under sub18 section (a)(1); and 

19 ‘‘(2) compares the estimates of the costs de20 scribed in paragraphs (1) and (2) of subsection (a) 

21 and the actual costs incurred by the private sector 

22 in carrying out or complying with the law in the fis23 cal year in which it took effect and in each of the 

24 4 fiscal years following such fiscal year.’’. 


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1 SEC. 3. PRESIDENT’S ANNUAL BUDGET SUBMISSIONS. 

2 Section 1105(a) of title 31, United States Code, is 

3 amended— 

4 (1) by redesignating the second paragraph des5 ignated as paragraph (37), relating to outdated or 

6 duplicative plans and reports, as added by section 11 

7 of the GPRA Modernization Act of 2010 (Public 

8 Law 111–352; 124 Stat. 3881), as paragraph (39); 

9 and 

10 (2) by adding at the end the following: 

11 ‘‘(40) a regulatory authority budget analysis of 

12 the Federal regulatory cost (as defined in section 

13 321 of the Congressional Budget Act of 1974) of 

14 complying with all current and proposed Federal 

15 regulations and proposals for complying with section 

16 324 of the Congressional Budget Act of 1974 for the 

17 fiscal year for which the budget is submitted and the 

18 4 fiscal years after that year.’’. 

19 SEC. 4. ESTIMATION AND DISCLOSURE OF COSTS OF FED20 ERAL REGULATION. 

21 (a) COSTS TO PRIVATE SECTOR OF NEW FEDERAL

22 REGULATIONS.—Chapter 6 of title 5, United States Code, 

23 popularly known as the ‘‘Regulatory Flexibility Act’’, is 

24 amended— 

25 (1) in section 603— 


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1 (A) in subsection (a), in the second sen2 tence, by inserting before the period the fol3 lowing: ‘‘and shall discuss in detail whether the 

4 cost to businesses of complying with the pro5 posed rule will vary depending on the size of the 

6 business and, if so, to what extent the cost will 

7 vary and what factors contribute to the vari8 ation’’; 

9 (B) in subsection (c)— 

10 (i) by redesignating paragraphs (1), 

11 (2), (3), and (4) as subparagraphs (A), 

12 (B), (C), and (D), respectively, and adjust13 ing the margin accordingly; 

14 (ii) by inserting ‘‘(1)’’ after ‘‘(c)’’; and 

15 (iii) by striking ‘‘Consistent with the’’ 

16 and inserting the following: 

17 ‘‘(2) The analysis of significant alternatives to the 

18 proposed rule shall include a detailed analysis of the costs 

19 and benefits of the proposed rule and each alternative, 

20 which shall separately address the costs and benefits for 

21 each industry. 

22 ‘‘(3) Consistent with the’’; and 

23 (C) by adding at the end the following: 

24 ‘‘(e) Each initial regulatory flexibility analysis shall 

25 also contain a description of the nature and amount of 


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1 monetary costs that will be incurred by small entities, 

2 other businesses, and individuals in complying with the 

3 proposed rule.’’; 

4 (2) in section 604(a)— 

5 (A) in the first paragraph designated as 

6 paragraph (6) (relating to minimization of sig7 nificant economic impacts), by striking ‘‘and’’ 

8 at the end; 

9 (B) by redesignating the second paragraph 

10 (6) (relating to covered agencies), as paragraph 

11 (8); and 

12 (C) by inserting after paragraph (6) the 

13 following: 

14 ‘‘(7) a statement of the nature and amount of 

15 monetary costs that will be incurred by small enti16 ties, other businesses, and individuals in complying 

17 with the rule; and’’; and 

18 (3) in section 607, by inserting before the pe19 riod the following: ‘‘, except that estimates of mone20 tary costs under sections 603(d) and 604(a)(7) shall 

21 only be in the form of a numerical description’’. 

22 (b) AGENCY REPORTS.—Each agency that prepares 

23 an initial regulatory flexibility analysis under chapter 6 

24 of title 5, United States Code, shall, at the same time sub25 mit to each House of Congress, the Congressional Budget 


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1 Office, and the Office of Management and Budget a cost 

2 estimate and cost benefit analysis of any new proposed 

3 regulations, rules, or statements that would have a Fed4 eral regulatory cost (as defined in section 321 of the Con5 gressional Budget Act of 1974, as added by this Act) of 

6 at least $10,000,000 for any fiscal year. 

7 SEC. 5. GUIDANCE DOCUMENTS. 

8 (a) DEFINITIONS.—In this section— 

9 (1) the terms ‘‘agency’’ and ‘‘rule’’ have the 

10 meanings given such terms in section 551 of title 5, 

11 United States Code; and 

12 (2) the term ‘‘guidance document’’ means an 

13 agency statement of general applicability and future 

14 effect, other than a rule, that sets forth a policy on 

15 a statutory, regulatory, or technical issue or an in16 terpretation of a statutory or regulatory issue. 

17 (b) LIMITATION ON GUIDANCE DOCUMENTS.—An 

18 agency may not issue a guidance document unless the 

19 agency— 

20 (1) issues the guidance document after notice 

21 and an opportunity for comment in accordance with 

22 the requirements for the promulgation of a rule 

23 under chapter 5 of title 5, United States Code; or 

24 (2) before the effective date of the guidance 

25 document, submits to Congress a report that— 


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1 (A) certifies that the guidance document is 

2 not a rule; and 

3 (B) explains in detail why the guidance 

4 document does not satisfy the definition of a 

5 rule. 

6 SEC. 6. STUDY OF NONMAJOR RULES. 

7 (a) DEFINITIONS.—In this section— 

8 (1) the term ‘‘agency’’ has the meaning given 

9 that term in section 551 of title 5, United States 

10 Code; 

11 (2) the term ‘‘covered guidance document’’ 

12 means any guidance document that has resulted or 

13 is likely to result in an annual effect on the economy 

14 of not less than $10,000,000; 

15 (3) the term ‘‘covered nonmajor rule’’ means 

16 any rule that has resulted in or is likely to result in 

17 an annual effect on the economy of not less than 

18 $10,000,000 and not more than $100,000,000; 

19 (4) the term ‘‘guidance document’’ means an 

20 agency statement of general applicability and future 

21 effect, other than a rule, that sets forth a policy on 

22 a statutory, regulatory, or technical issue or an in23 terpretation of a statutory or regulatory issue; 

24 (5) the term ‘‘Federal regulatory cost’’ has the 

25 meaning given that term under section 321 of the 


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1 Congressional Budget Act of 1974, as added by sec2 tion 2 of this Act; and 

3 (6) the term ‘‘rule’’ has the meaning given that 

4 term in section 804 of title 5, United States Code. 

5 (b) REPORTS.—Not later than 120 days after the 

6 date of enactment of this Act and every 2 years thereafter, 

7 the Comptroller General of the United States shall submit 

8 to Congress a report regarding covered nonmajor rules 

9 and covered guidance documents, which shall include, for 

10 the 4-year period immediately preceding the report— 

11 (1) the number of covered nonmajor rules pro12 mulgated; 

13 (2) the number of covered nonmajor rules im14 plemented; 

15 (3) the number of covered guidance documents 

16 developed; 

17 (4) the number of covered guidance documents 

18 issued; 

19 (5) the Federal regulatory cost of each covered 

20 nonmajor rule implemented; 

21 (6) the Federal regulatory cost of each covered 

22 guidance document issued; 

23 (7) the aggregate Federal regulatory cost of all 

24 covered nonmajor rules implemented; 


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1 (8) the aggregate Federal regulatory cost of all 

2 covered guidance documents issued; and 

3 (9) a discussion of any covered nonmajor rule 

4 for which an initial regulatory flexibility analysis was 

5 prepared under section 603 of title 5, United States 

6 Code, a final regulatory flexibility analysis was pre7 pared under section 604 of title 5, United States 

8 Code, or a cost benefit analysis was prepared that 

9 underestimated the actual Federal regulatory cost of 

10 implementing the covered nonmajor rule. 

Æ 


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