Federal Rulemaking: Improvements Needed to Monitoring and Evaluation of Rules Development as Well as to the Transparency of OMB Regulatory Reviews
Published: 2009-04-20T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Regulation is one of the principal tools that the government uses to implement public policy. As part of the rulemaking process federal agencies must comply with an increasing number of procedural and analytical requirements. GAO was asked to examine how broadly applicable rulemaking requirements cumulatively have affected (1) agencies' rulemaking processes, in particular including effects of requirements added to the process since 2003, and (2) transparency of the Office of Information and Regulatory Affairs (OIRA) regulatory review process. To address these objectives, GAO reviewed selected rules issued between January 2006 and May 2008 and associated dockets and also interviewed knowledgeable agency and OIRA officials.
section_title: What GAO Found
paragraphs: The agencies GAO reviewed had little data on the time and resources used to comply with regulatory requirements making it difficult to evaluate the effects of these requirements on rulemaking. All the agencies set milestones for regulatory development. During our review, only the Department of Transportation (DOT) provided data showing that it tracked and reported on milestones, but EPA and FDA provided similar information in their agency comments. The agencies GAO reviewed also could provide little systematic data on the resources they used--such as staff hours, contract costs, and other expenses--in developing rules. DOT and SEC have attempted to identify staff time expended on individual rules but are encountering difficulties generating usable and reliable data. Despite the challenges they have encountered in attempting to track time and resources in rulemaking, agency officials identified potential benefits to the management of their processes if they had such information to evaluate. Systematic tracking and reporting by agencies on their schedules and milestones would also be consistent with internal control standards. Our review of 139 major rules including 16 case-study rules revealed that most triggered analytical requirements under the Paperwork Reduction Act (PRA), Regulatory Flexibility Act (RFA), and Executive Order 12866, but few other requirements. Agency officials reported that requirements added to the rulemaking process by the Office of Management and Budget (OMB) since 2003 sometimes required a learning period when first implemented, but their agencies either already performed the added requirements or recognized the revisions as best practices. The officials instead identified long-standing requirements of the PRA and the RFA as generally requiring a more significant investment of resources. Based on the limited information available, the average time needed to complete a rulemaking across our 16 case-study rules was about 4 years, with a range from about 1 year to nearly 14 years, but there was considerable variation among agencies and rules. OIRA's reviews of agencies' draft rules often resulted in changes. Of 12 case-study rules subject to OIRA review, 10 resulted in changes, about half of which included changes to the regulatory text. Agencies used various methods to document OIRA's reviews, which generally met disclosure requirements, but the transparency of this documentation could be improved. In particular, some prior issues persist, such as uneven attribution of changes made during the OIRA review period and differing interpretations regarding which changes are "substantive" and thus require documentation. Out of eight prior GAO recommendations to improve the transparency OIRA has implemented only one--to clarify information posted about meetings with outside parties regarding draft rules under OIRA review.

section_title: Letter
paragraphs: Regulation is one of the principal tools that the government uses to  implement public policy. Federal regulations affect many aspects of  citizens’ lives, whether addressing issues featured in the headlines of the  past year, such as the safety of the food supply and the health of the  housing and financial markets, or other long-standing goals such as  environmental protection and workplace and transportation accident  prevention. Regulations also help ensure the effective distribution of funds  under a range of programs including Medicare, Medicaid, Social Security,  agricultural support, and disaster assistance programs. Underlying federal  regulatory actions is the long-standing rulemaking process established by  the Administrative Procedure Act (APA).
As part of that process, Congresses and Presidents have required agencies  to comply with an increasing number of procedural and analytical  requirements prior to issuing a rule. Some requirements apply only to  cabinet departments and independent agencies, while others also apply to  independent regulatory agencies. The goals of these requirements include  promoting public participation in rulemaking, reducing regulatory  burdens, requiring more rigorous regulatory analysis, and enhancing  oversight of agencies’ rulemaking. As we have previously reported, these  requirements entail a wide range of procedural, consultative, and  analytical actions on the part of the agencies. For example, the  Regulatory Flexibility Act (RFA) requires agencies to examine the impact  of their rules on small entities. The Paperwork Reduction Act (PRA)  requires agencies to provide public notice, solicit comments, and request  approval by the Office of Management and Budget (OMB) before imposing  new information collection requirements. Executive Order 12866 directs  agencies (other than independent regulatory agencies) to assess costs and  benefits of available regulatory alternatives and to submit significant rules  to OMB’s Office of Information and Regulatory Affairs (OIRA) for review  before they are published. (See app. I for a summary of agencies’  responsibilities under broadly applicable regulatory requirements relevant  to the rules we reviewed for this report.)
In the past, Congress has asked us to review the implementation of  specific rulemaking requirements. For this report, you asked us to  examine how broadly applicable rulemaking requirements cumulatively  have affected (1) agencies’ rulemaking processes and (2) the transparency  of the OIRA review process. Specifically, you asked us to address the  following aspects of the rulemaking process:    To the extent that information is available, how have changes in  requirements since 2003 affected the complexity, cost, and length of the  rulemaking process?
How long do agencies take to issue rules?    What requirements must an agency comply with to issue a major rule?    What effect do agency interactions with OMB have on rulemaking?
To address the first and second questions, we primarily relied on reviews  of 16 case studies and interviews with officials from regulatory agencies  and OMB. We chose a case-study approach because agency officials  informed us during initial meetings that little systematic information  existed within agencies on the time, staffing, and contracting costs  associated with the development of individual rules or the required  analyses that support rulemakings. To identify the rules for our case  studies, we relied on our Federal Rules Database. The database includes  information such as the type of rule (major or nonmajor), priority of the  rule (for example, whether it is a significant rule), and the publication date  of the rule. We drew a sample from final rules issued from January 2006  through May 2008, to increase the likelihood that the rules chosen were  affected by changes in regulatory requirements since 2003 and for which  the staff who were involved would be available to discuss the rulemaking  process. We randomly selected 16 major or other significant final rules  from executive branch agencies responsible for health, safety, and  environmental regulations and an independent regulatory agency for  purposes of comparison. We examined two case-study rules each from  the Department of Transportation’s (DOT) Federal Aviation  Administration (FAA) and National Highway Traffic Safety Administration (NHTSA), the Environmental Protection Agency’s (EPA) Office of Air a nd  Radiation (OAR) and Office of Water (OW), the Food and Drug  Administration’s (FDA) Center for Drug Evaluation and Research (CDER and Center for Food Safety and Applied Nutrition (CFSAN), and the  Securities and Exchange Commission’s (SEC) Division of Corporation  Finance (CF) and Division of Investment Management (IM). Although  these agencies and offices are not equivalent organizationally, we treate ) d  them as such for purposes of this report to obtain comparable volum major and significant final rules in our selection process. The agencies,  offices, and sample of rules that we assessed are not representative of all regulatory agencies and all rules.
We reviewed the agencies’ regulatory dockets for each rule selected using  a standardized data collection instrument and discussed what we found  with knowledgeable agency officials and OMB. We defined “changes in  requirements” as changes that OMB identified as significant in its  September 2003 revision of OMB Circular No. A-4, which provides  guidance on conducting regulatory analysis, and also OMB’s December  2004 Final Information Quality Bulletin for Peer Review. These changes  were implemented since our 2003 report on OMB’s role in the rulemaking  process.
To answer the third question, we reviewed the statutory and executive  requirements broadly applicable to rulemaking. We also analyzed the 139  major rules, as defined by the Congressional Review Act (CRA), issued  from January 2006 through May 2008 to be consistent with the time period  used for selection of our case studies. To identify the rules, we again relied  on our Federal Rules Database. Based on our tests of the data in the  database, including confirming the quality control steps used to ensure  completeness of the database and tracing database information back to  source documents, we determined that these data were sufficiently  reliable for the purposes of this report. To identify the requirements that  were discussed and that were triggered by the major rules, we reviewed  the relevant GAO major rule report on the rule and the published final  rule.
To answer the fourth question, we analyzed the information collected  above and reviewed the dockets of the 12 selected case-study rules from  DOT, EPA, and FDA relying on the same basic methodology we previously  used to report on OMB’s role in and affect on rulemaking—reviewing  documents from agencies’ and OMB’s dockets and interviewing officials to  obtain information about the regulatory review process for selected rules.  We chose these rules because all were subject to review by OMB/OIRA  under Executive Order 12866 and the transparency requirements under the  order. The other 4 case-study rules were not subject to OIRA review  because SEC is an independent regulatory agency. As part of the fourth  question, you also asked us to review the status of GAO recommendations  from GAO-03-929 on improving the transparency of OIRA’s regulatory  review process. To report on the status of those recommendations, we  relied on information from our annual update of open recommendations  and interviews with OMB officials.
For reporting purposes, we discuss our findings on the first three  questions in objective one—the effects of rulemaking requirements on  agencies’ rulemaking processes, including the complexity, cost, and length  of their processes. Our findings related to the fourth question and updated  findings from our 2003 report are discussed in objective two—the  transparency of OMB’s role in the regulatory review process. We  conducted our review from August 2008 through February 2009 in  accordance with generally accepted government auditing standards. Those  standards require that we plan and perform the audit to obtain sufficient,  appropriate evidence to provide a reasonable basis for our findings and  conclusions based on our audit objectives. We believe that the evidence  obtained provides a reasonable basis for our findings and conclusions  based on our audit objectives.
subsections: section_title: Background
paragraphs: Regulatory agencies have authority and responsibility for developing and  issuing regulations. The basic process by which all federal agencies  develop and issue regulations is spelled out in the APA. This act  establishes procedures and broadly applicable federal requirements for  informal rulemaking, also known as notice and comment rulemaking.  Among other things, the APA generally requires agencies to publish a  notice of proposed rulemaking in the Federal Register. After giving  interested persons an opportunity to comment on the proposed rule by  providing “written data, views, or arguments,” the agency may then  publish the final rule. In addition to the requirements under the APA, an  agency may also need to comply with requirements imposed by other  statutes. The APA has been in place for more than 60 years, but most other  statutory requirements on rulemaking have been imposed more recently.
OMB is responsible for the coordinated review of agency rulemaking to  ensure that regulations are consistent with applicable law, the President’s  priorities, and the principles set forth in executive orders, and that  decisions made by one agency do not conflict with the policies or actions  taken or planned by another agency. OMB also provides guidance to  agencies. Some form of centralized review of rules by the Executive Office  of the President has existed for over 30 years. OIRA was created within  OMB by the PRA and given substantive responsibilities for reviewing and  approving agencies’ information collection requests. Since 1981, various  executive orders also gave OIRA substantive regulatory review  responsibilities. OIRA’s current regulatory review responsibilities are  detailed in Executive Order 12866 related to regulatory planning and  review. The order states that OIRA is to be the “repository of expertise  concerning regulatory issues.”
Under Executive Order 12866, OIRA reviews agencies’ significant  regulatory actions and is generally required to complete its review within  90 days after an agency formally submits a draft regulation. Each agency  provides OIRA a list of its planned regulatory actions, indicating those that  the agency believes are significant. After receipt of this list, the  Administrator of OIRA may also notify the agency that OIRA has  determined that a planned regulation is a significant regulatory action  within the meaning of the Executive Order. The order defines significant  regulatory actions as those that are likely to result in a rule that may  1.  have an annual effect on the economy of $100 million or more or  adversely affect in a material way the economy, a sector of the  economy, productivity, competition, jobs, the environment, public  health or safety, or State, local, or tribal governments or communities;  2.  create a serious inconsistency or otherwise interfere with an action  taken or planned by another agency;  3.  materially alter the budgetary impact of entitlements, grants, user fees,  or loan programs or the rights and obligations of recipients thereof; or  4.  raise novel legal or policy issues arising out of legal mandates, the  President’s priorities, or the principles set forth in Executive Order  12866.
The order further directs executive branch agencies to conduct a  regulatory analysis for economically significant regulations (generally  those rules that have an annual effect on the economy of $100 million or  more). OIRA historical data show that since 1994 (the first full calendar  year that Executive Order 12866 was in effect), approximately 15 percent  of the rules that OIRA reviewed were economically significant. For other  significant rules, the order requires agencies to provide an assessment of  the potential costs and benefits of the rule. The executive order also  contains several transparency provisions that require both OIRA and  agencies to disclose certain information about the OIRA review process.  For example, the order requires agencies to publicly identify substantive  changes made to the draft at OIRA’s suggestion, and it requires OIRA to  disclose information about communications between OIRA and persons  not employed by the executive branch pertinent to rules under OIRA’s  review. The transparency requirements are discussed in more detail later  in this report.
In addition to the responsibilities that OIRA exercises, OMB also provides  guidance to agencies on regulatory requirements. In 2003, for example,  OMB issued revised analytical guidelines for agencies to use in assessing  the regulatory impact of economically significant regulations in OMB  Circular No. A-4. In issuing the guidelines, OMB cited several significant  changes from its previous economic guidance. They included placing a  greater emphasis on cost-effectiveness analysis, using formal probability  analysis to assess uncertainty for rules with more than a billion-dollar  annual impact on the economy, and conducting a more systematic  evaluation of qualitative as well as quantified benefits and costs. In  addition, OMB’s guidelines recommend that agencies estimate net benefits  using a range of discount rates instead of a single discount rate. In 2004,  OMB issued its Final Information Quality Bulletin for Peer Review, which  established governmentwide guidance for conducting peer reviews of  government science documents. The bulletin directs agencies, including  independent regulatory agencies, to subject “influential scientific  information,” such as original data and formal analytic models used in  regulatory impact assessments, to an appropriate level of peer review.
New administrations generally reexamine the rulemaking process and  OMB’s role in the process. Most recently, in a memorandum of January 30,  2009, President Obama directed the Director of OMB, in consultation with  representatives of regulatory agencies, to produce within 100 days a set of  recommendations for a new executive order on federal regulatory  review. The memorandum stated that the recommendations should offer  suggestions for, among other things, the relationship between OIRA and  the agencies; provide guidance on disclosure and transparency; encourage  public participation in agency regulatory processes; offer suggestions on  the role of cost-benefit analysis; address the role of distributional  considerations, fairness, and concern for the interests of future  generations; identify methods of ensuring that regulatory review does not  produce undue delay; clarify the role of the behavioral sciences in  formulating regulatory policy; and identify the best tools for achieving  public goals through the regulatory process.
section_title: Agencies Have Limited Data on the Time and Resources Used to Address Regulatory Requirements in Their Rulemaking Processes
paragraphs: All agencies’ rulemaking processes share three basic steps or phases:  initiation of rulemaking actions, development of proposed rules, and  development of final rules. Built into agencies’ rulemaking processes are  opportunities for internal and external deliberations and reviews. Figure 1  provides an overview of these regulatory development steps.
During initiation, agency officials identify issues that may potentially result  in a rulemaking. Potential rulemakings may result from statutory  requirements or issues identified through external sources (for example,  public hearings or petitions from the regulated community) or internal  sources (for example, management agendas). During this phase, agencies  gather information that would allow them to determine whether a  rulemaking is needed and to identify potential regulatory options. At this  time, the agencies will also identify the resources needed for the  rulemaking and may draft concept documents to present to agency  management that summarize the issues, present the regulatory options,  and identify needed resources. Agency officials reported that this initial  work on a rule is of indeterminate length and sometimes constitutes a  major portion of the process. While the point at which a rulemaking  officially commences may vary by agency and rule, as a general matter,  rulemaking begins only after management receives, reviews, and approves  the concept document. At the latest, according to OIRA, the rulemaking  will officially commence when agency officials assign a Regulation  Identifier Number (RIN) for the proposed rule.
The second phase of the rulemaking process starts when an agency begins  developing the proposed rule. During this phase, an agency will draft the  rule, including the preamble (which is the portion of the rule that informs  the public of the supporting reasons and purpose of the final rule) and the  rule language. The agency will also begin to address analytical and  procedural requirements in this phase. Agency officials pointed out that  these initial analyses form the basis for other analyses completed later in  the process, including those prepared to address statutory and executive  order requirements. Agency officials stated that development of a rule is a  coordinated effort, with economists, lawyers, and policy and subject  matter experts contributing to individual rulemakings. Also built into this  phase are opportunities for internal and external deliberations and  reviews, including official management approval. OIRA may be involved  informally at any point during the process. For each rule identified by the  agency as, or determined by the Administrator of OIRA to be, a significant  regulatory action, the agency submits the rule to OIRA for formal review— including the coordination of interagency review. After OIRA completes its  review and the agency incorporates resulting changes, the agency  publishes the proposed rule in the Federal Register for public comments.
In the third phase of the process, the development of the final rule, the  agency repeats, as needed, the steps used during the development of the  proposed rule. Once the comment period closes, the agency responds to  the comments either by modifying the rule to incorporate the comments or  by addressing the comments in the final rule. This phase also includes  opportunities for internal and external review. Again, if the agency  determines that the rule is significant or at OIRA’s request, the agency  submits the rule to OIRA for review before publication of the final rule. In  the event that OIRA’s review results in a change to the final rule, the  agency will revise the rule before publishing it in the Federal Register.  Officials noted that addressing analytical and procedural requirements is  faster with a draft of the proposed rule in hand, but analyses may need to  be modified if public comments change the rule substantially. The final  rule as published in the Federal Register includes the date that the rule  becomes effective.
While the agencies share these basic process steps, there are inter- and  intra-agency variations in the management of the rulemaking process. For  example, EPA’s OW generally designates one rulemaking team member as  the point of contact through the development of the rule. Officials at FDA  stated that their point of contact may change during the course of the  rulemaking based on the rule’s development phase; as the office working  on the rule within the agency changes so does the point of contact.  Agencies also have differing numbers of required internal reviews, and  they may complete tasks within a phase in a different sequence.
subsections: section_title: Agencies Identified Milestones for Regulatory Development
paragraphs: Officials we met with described agency-specific processes for regulatory  development and addressing the procedural and analytical requirements  that applied to their respective rulemakings. These included identification  of “milestones,” significant events or stages in the agency-specific process.  Officials also identified some milestones common to the rulemaking  process that apply across the federal government, such as publishing the  proposed and final rule. In addition, officials at the agencies we spoke  with identified the following agency-specific internal milestones in their  regulatory development process.
DOT officials at FAA and NHTSA identified common milestones, including  development of a draft concept, management reviews within  administrations, review by the Secretary’s Office, and external review.
EPA identified 14 milestones for nonroutine rulemakings from initiation to  publication of the proposed rule, including assigning a working group,  development and approval of an Analytic Blueprint and management  reviews. After the proposed rule is published, EPA tracks an additional 4  to 5 milestones to develop the final rule.
FDA officials emphasized that regulatory development is similar  throughout FDA. CFSAN and CDER used milestones such as assigning a  working group, drafting, and conducting analyses and management  clearances.
SEC officials stated that CF and IM identified as common milestones  generation (typically including public input), drafting, and approval by the  commissioners.
During the course of our review, only DOT provided us with data that  showed it routinely tracked these milestones. In comments on our draft  report, EPA and FDA subsequently provided some documentation and  data that showed that these agencies also routinely tracked milestones.  However, we had requested this information during our review to address  our second research question, but the information was not forthcoming.  Also, they did not provide this information at the conclusion of our review  either in response to our statements of facts to the agencies or at our exit  conference with the agencies. Because this information was not provided  at the time of our review, we did not have the opportunity to discuss how  the information is used, whether it is useful, and, most importantly, if it  could be used to respond to our report objectives. We did not audit the  new information provided because of an approaching deadline for OMB to  provide recommendations to the President for a new executive order on  federal agency regulatory review.
DOT sets target dates for major milestones, such as when the rule is  scheduled to move to OIRA for review. The agency uses the Rulemaking  Management System to monitor both the target and actual dates for these  major milestones in the development of rules for internal management  decision-making purposes. This allows DOT regulatory development staff  and managers to identify a rule’s status and determine if the rule is on or  behind schedule, based on target dates. Some of the information captured  in the system includes the stage of the rulemaking (proposed rule, final  rule), a schedule of milestones with target and actual dates, and an  explanation for any delay. For significant regulatory actions, DOT makes  some milestone tracking information publicly available through the Report  on DOT Significant Rulemakings available on the agency’s web site.
Among the objectives that DOT officials attributed to their tracking and  reporting efforts were that they provide opportunities to assess their  schedule estimates and improve internal and external accountability. An  official noted, for example, that tracking and posting the information  helped the agency identify best estimates of schedules.
EPA uses an internal tracking database—Rule and Policy Information and  Development System (RAPIDS)—that contains both projected and actual  dates for meeting major milestones in rule development. This database  provides background information and a timetable on each stage of the  rulemaking, including a schedule of the milestones with both projected  and actual dates. EPA uses the data in RAPIDS to develop management  reports used by EPA managers and executives as a planning and tracking  tool. The reports also serve as a tool to improve the regulatory  development process. EPA makes this tracking information available to  the public on a quarterly basis.
FDA also tracks regulatory milestones through its Federal Register  Document Tracking System (FRDTS). FRDTS is an internal, Web-based  integrated system that allows FDA to track the preparation and approval  process of documents to be submitted to the Federal Register for  publication. Tracking the rulemaking approval process is done for all  rulemakings, however the system only tracks milestones for the latter  stages of the rulemaking’s development and clearing process. FDA  management uses the information in FRDTS as one tool in the  management of its regulatory development process.
SEC did not have such systematic tracking and reporting of its scheduled  and actual regulatory milestones. However, implementing such a system is  consistent with standards for internal control. According to the  standards, for an agency to run and control its operations, it must have  relevant, reliable information relating to external as well as internal  events. Moreover, an acknowledged expert on the regulatory process has  stated that a myriad of formal requirements and political expectations  requires sophisticated management of the rulemaking process. Among  other functional requirements, he noted that scheduling and budgeting for  rulemaking are useful tools for officials to manage regulation development  and control the resources needed to complete a rule. Monitoring and  assessing actual performance against planned targets, identifying reasons  for missed targets, and adjusting resource requirements to fit conditions  based on actual experience are among the ways that agencies could use  their rulemaking plans and milestones as management control and  accountability tools.
section_title: Length of Time Required to Issue a Rule Varies by Agency and Rule with Few Common Characteristics
paragraphs: We found variation in length of time required for the development and  issuance of final rules both within and among agencies. In general, agency  officials agreed that the publication of the final rule marked the end of the  rulemaking process. In contrast, identifying when a rulemaking begins is  less definite. All agencies identified milestones that marked the initiation  of a rulemaking in their agencies, but also asserted that agency staff  sometimes worked on certain issues related to the rulemaking years  before commencement of the actual rulemaking, either as part of earlier,  related rulemakings or policy development for the rule. Based on agency  milestones, officials we spoke with at three of the four agencies provided  estimates for the length of time for an average rulemaking. FDA officials  estimated that a straightforward rulemaking may take up to 3½ to nearly 4  years from initiation to final publication. DOT officials estimated  approximately 1-½ years from the end of the public comment period  following the publication of the proposed rule to final rule. SEC officials  estimated that some rules are completed within 6 months of publication of  a proposed rule to final rule. EPA officials declined to provide an estimate  for an average rulemaking at their agency, stating that there is too much  variation. However, some agency officials emphasized that the average  time required to issue any given rule could vary from these estimates, as  illustrated by the 16 case-study rules we reviewed (see fig. 2).
Using two rulemaking milestones common among federal agencies— publication in the Federal Register of the proposed rule and publication of  the final rule—the length of time for our 16 case-study rules ranged from  approximately half a year (SEC’s Mutual Fund Data Reporting rule) to  nearly 5 years (FDA’s Physician Labeling rule). As an illustration of the  time investment in regulatory development—as measured from agency- specific internal milestones—the entire rulemaking process for the same  two rules ranged from slightly over 1 year to 13 years, respectively. Overall  the average time from initiation to final publication of a rule for our 16  case-study rules was just over 4 years, with the average time for the 4 SEC  rules just over 1 year, the DOT rules taking an average of just over 3 years,  and the EPA and FDA rules taking longer than the overall average at 5-1/2  and 7 years, respectively. For most of our case study rules, the time to  develop the proposed rule was at least as much as the time between  publication of the proposed and final rules. We also found that the  complexity or magnitude of a major rule also did not explain all or most  variation, as some case-study rules that were not major took nearly as long  or longer to be published. (For more detailed information about the  timelines for each of the case-study rules, see app. II.)
During our review we identified multiple factors that influence the time  needed to issue a rule, including  the complexity of the issues addressed by the rulemakings;    prioritizations set by agency management that can change when other  priorities, such as new congressional mandates, arise; and  the amount of internal and external review required at the different phases  of the rulemaking process.
Some agency officials said that rulemaking for complex topics or for rules  that raise new issues typically takes longer to complete than for routine  rules. Rules that are a management priority or have a statutory or judicial  deadline may move more quickly through the rulemaking process, while  other rules may be set aside as agency staff members work on other  things. Also, rules that require OIRA and interagency review typically need  additional time for the external review process and, according to some  agency officials, trigger additional internal scrutiny. The priorities and the  pace of rulemaking have also been affected during transitions in  presidential administrations. Since 1948, the amount of rulemaking activity  has increased in the last months of every outgoing administration when  the party in control of the White House changed. During every recent  transition involving a change in the party controlling the White House  since 1981, this has been followed by the incoming administration  recommending that agencies delay effective dates for reconsideration of  rules published at the end of the previous administration.
section_title: Agencies Have Limited Information on Resources Used in Regulatory Development
paragraphs: There is little rule-specific tracking of resources used in regulatory  development. Agency officials were unable to identify the staffing or other  resources (such as contracting costs associated with preparing expert  analyses or convening public meetings) for regulatory development for all  rules or for the limited number of case-study rules. As noted above,  internal control standards call for relevant, reliable and timely  information. Regarding staffing, such management information was not  available from agencies we audited. Officials were able to generally  describe how they staff rulemaking, noting that rulemaking is a  coordinated effort, with many individuals from throughout the agency  contributing to specific rulemakings. However, none of the agencies  routinely tracked staff time associated with rulemakings or were able to  provide records of staff time devoted to case-study rulemakings or  supporting analyses. Moreover, agency officials stated that because many  staff within the agencies with different job functions—attorneys,  economists, programs staff, as well as regulatory developers—contribute  to individual rules, they could not provide after-the-fact estimates.
However, based on their experiences, the agencies’ officials identified  ways they have explored using existing agency information for purposes  of improving management of the rulemaking process. For example,  according to a DOT official responsible for rulemaking, having reliable  data on how long it takes to publish a proposed rule and identifying where  the time is spent is critically important for reengineering the process. The  official also pointed out that while the agency knows that the time of some  support staff is all devoted to rulemaking, there is no data for tracking  core program offices’ involvement in technical and lead roles in the  rulemaking process. The official noted that these data could help  determine how much of certain staff members’ time is reasonable and how  many additional staff days would be needed to speed up the process. EPA  officials stated that they use the tracking information in the agency’s  RAPIDS system to help identify best practices as well as identify those  actions that need corrective measures. FDA officials stated that they track  the rulemaking process from a project management perspective.  According to these officials, this allows the agency to identify areas that  appear to “logjam” the process and to develop mechanisms that would  improve the rulemaking process. In addition, FDA officials stated that  agency management meets to discuss the major milestones reported in the  FRDTS to identify areas of improvement in the regulatory development  process. SEC officials also track some data from a project management  perspective. Officials stated that the former SEC Chairman was interested  in knowing how long it takes to conduct economic analyses. During the  course of our review, EPA, FDA, and SEC did not document these claims  or provide specific examples of how this information was used to improve  their rulemaking process. However, in response to our draft report, the  EPA and FDA provided both documentation and examples to support the  information provided above.
Agency officials described additional details about their tracking efforts  and the limitations of this information. One DOT agency, FAA, is working  on a system, called Labor Distribution Reporting (LDR) that allows all  FAA managers and employees to better understand staff resources  required for achieving agency goals and objectives. However, using LDR to  assess the staff time devoted to rulemaking has proven challenging for  FAA officials responsible for rulemaking activity. Those officials said that  the data generated by LDR have not been reliable and the information  does not necessarily track rulemaking activity as distinct from other staff  responsibilities. Additionally, attempts to aggregate LDR information by  rule proved unwieldy as these costs are imbedded in agency-wide systems  that capture information at a higher level and for multiple purposes. FAA  is reengineering its use of LDR by consolidating and simplifying the codes  used with the goal of providing managers with reliable information on how  staff time is used and how it contributes to meeting agency performance  targets. SEC’s CF also tried to do more detailed staff time coding for each  rulemaking project but has now instituted more generic tracking by  category of activity. A CF official also pointed out that CF’s coding does  not cover all groups within SEC that contribute to rulemaking projects.  Another SEC official from the Division of Trading and Markets identified a  similar tracking challenge. Although the division has specific rulemaking  offices organized by subject area, not all the work done by these offices is  related to rulemaking.
Similarly, there is limited information available regarding contract costs.  At three of the agencies in our case study—DOT, FDA, and SEC— analytical and procedural requirements typically are addressed in-house  by agency staff. One agency, EPA, regularly supplements in-house staff  responsible for regulatory development by hiring contractors to conduct  analyses as part of the regulatory development process. The agency does  not track these costs by rulemaking; however, EPA officials were able to  identify some of the costs associated with regulatory development for four  case-study rules. For the two major OW rules—the Surface Water  Treatment 2 rule and the Disinfection Byproducts 2 rule—the costs related  to expert advisory panels, public meetings, travel, and regulatory analyses  for the microbial pathogens and disinfection byproducts cluster of rules  (that includes a total of seven rules including the two case study rules)  were more than $13 million. As mentioned above, EPA did not track the  costs of each of these rules separately throughout the course of rule  development. Identified costs for the two nonmajor rules—the Ethylene  Oxide Emissions rule and the Hazardous Air Pollutants rule—were less,  $100,000 and $780,000, respectively. EPA officials told us that funding for  regulatory analyses comes from a central budget within the program  developing the rule.
As stated earlier, while it is difficult to pinpoint when the initiation phase  of rulemaking begins, agency officials reported that developing proposed  rules constitutes a significant portion of regulatory development, so that  much of the resource investment in a rulemaking occurs prior to  publication of the proposed rule. For example, NHTSA’s Fuel Economy- Light Trucks rule was just one in a series of related rulemakings that dated  back to the 1970s, informed by decades of work by that agency. Also,  EPA’s Disinfection Byproducts 2 rule and the Surface Water Treatment 2  rule were based on the work of an expert panel convened under the  Federal Advisory Committee Act years before these rules were proposed.  Another example mentioned by EPA officials was a stormwater  management rule for the oil and gas industry that supplemented and was  partially based on an earlier nationwide, multi-industry rulemaking.
Reviews of published rules or rulemaking dockets provide little  information on the resources and level of effort needed for agencies to  comply with specific rulemaking requirements. As pointed out by DOT  officials, neither the text of the rule nor the materials in the agency’s  rulemaking docket might indicate all of the resources and the decision- making process that the agency performed to make such determinations.  Specifically, they noted that dockets would not necessarily include copies  of the underlying analyses if the agency concluded that the rule did not  trigger that requirement. Also, each requirement that a rule triggers does  not necessarily require preparation of a separate analysis. Agencies can  use some analyses to address more than one requirement (for example,  using one benefit-cost analysis to address multiple analytical  requirements).
Even if costs and resources were tracked at the individual rule level, the  resources used to meet general rulemaking requirements would still need  to be captured to provide a complete picture. Rulemaking is an integral  part of agency business, and it would be hard to separate all that is done  for rulemaking from what also contributes to other operational and policy  decisions. Further, given the many other demands on scarce agency  resources, the resources that would be needed to develop reliable tracking  data on individual rules or requirements must be weighed against other  investments.
section_title: Many of the Rules GAO Reviewed Triggered Few of the Broadly Applicable Rulemaking Requirements
paragraphs: When issuing major rules, agencies must generally comply with the APA  and a number of other broadly applicable procedural and analytical  requirements specified in law. However, one statutory requirement, the  Unfunded Mandates Reform Act of 1995 (UMRA), does not apply to  independent regulatory agencies. EPA and the Occupational Safety and  Health Administration must also comply with a requirement to convene a  small business advocacy review panel under the Small Business  Regulatory Enforcement Fairness Act if their rules would have a  significant economic impact on a substantial number of small entities— business or governmental. Further, agencies other than independent  regulatory agencies are also subject to requirements in executive orders.  In addition to the broadly applicable requirements, agencies may need to  comply with agency- or program-specific requirements established by  other statutes.
Table 1 lists the 17 broadly applicable statutes and executive orders with  rulemaking requirements that were cited by 10 or more major rules that  we reviewed for this report. For each we provide a high-level  characterization of agencies’ responsibilities under the requirement. (App.  I provides additional information about these requirements.)
Our review of the 139 major rules published from January 2006 through  May 2008 showed that many of the procedural and analytical requirements  that generally apply to the agencies were not triggered by specific rules.  An agency may not need to include specific analyses if the substance of  the rule or exceptions, exclusions, and thresholds in the requirement lead  the agency to determine that the requirement was not triggered by a  specific rule. For example, if the substance of a rule includes no new  information collections, the agency would not have to estimate burden  hours under the PRA. Exceptions and exclusions can be either categorical  or statute specific. As an example of a categorical exception, the APA  notice-and-comment requirements do not apply to any rule regarding a  military or foreign affairs function of the United States. Also, the RFA and  UMRA requirements do not apply if a rule was exempt from the APA  notice-and-comment requirements. An example of a statute-specific  exemption is section 1601(c) of the Farm Security and Rural Investment  Act of 2002 that generally exempted rules issued by the Department of  Agriculture’s Commodity Credit Corporation from the APA and the PRA  requirements. The applicability of certain requirements is also limited by  threshold provisions. For example, agencies only need to prepare UMRA  “written statements” for rules that the agencies believe include a federal  intergovernmental or private sector mandate that may result in  expenditures of $100 million or more (adjusted for inflation) in any year.  Taken as a whole, an agency may need to work through a series of  determinations for each rule under each requirement regarding substance,  exceptions, and thresholds.
In the 139 major rules we reviewed, the agencies mentioned at least 29  different broadly applicable requirements, but most rules actually  triggered only a handful of the requirements. Our review of the major rules  showed that in addition to the procedural requirements under the APA and  the CRA, the only analytical requirements triggered by 45 percent or more  of all rules were the PRA, the RFA, and Executive Order 12866.  Collectively, however, the requirements resulted in agencies providing at  least some information on the costs, benefits, or both associated with 91  percent of the major rules. Agencies also frequently cited the UMRA and  Executive Order 13132 related to federalism, but the rules seldom  triggered those requirements. Figure 3 illustrates how often the agencies  stated that their rules triggered the most commonly cited analytical  alytical  requirements, according to our major rules reports.  requirements, according to our major rules reports.
Similarly, the 16 case-study rules that we reviewed triggered some, but not  all, of the broadly applicable requirements. All 16 of the rules discussed  requirements under the PRA and the RFA, but only 11 triggered a PRA  analysis and 10 an RFA analysis. Except for the rules promulgated by SEC,  all of the rules discussed UMRA and Executive Order 13132 requirements;  however, only 4 rules triggered an UMRA analysis and 3 a federalism  analysis. The 4 case-study rules from DOT, EPA, and FDA that were  economically significant rules also included quantitative cost-benefit  analyses required under Executive Order 12866. Figure 4 illustrates how  often the agencies stated that the case-study rules triggered the most  commonly cited analytical requirements. (See the case studies in app. II  for further details on the regulatory requirements addressed by each rule.)
section_title: Agencies Reported That Recent Regulatory Requirements Presented Some Challenges Initially
paragraphs: Agency officials from case-study agencies reported that in some instances,  the new requirements imposed by OMB since 2003 were challenging  initially, requiring additional time and resources. However, some officials  noted that these recent requirements reflected practices that some  agencies had already adopted. For example, FDA had routinely circulated  the regulatory impact analyses of economically significant rules for peer  review before submitting the rules to OMB prior to the 2004 issuance of  the Peer Review Bulletin and while these regulatory impact analyses are  excluded from the requirements of the Bulletin, FDA continues to  circulate them for peer review. FDA officials agreed that the revised OMB  Circular No. A-4 helped to clarify expectations for their economic analyses  and in some cases resulted in less time needed for OMB review and  greater confidence in the regulatory choices.
Initially incorporating certain aspects of the new requirement for formal  probability analysis to assess uncertainty lengthened the rulemaking  process for one agency. NHTSA officials reported that prior to issuance of  revised Circular No. A-4—which requires formal probability analysis to  assess uncertainty for rules with more than a billion-dollar annual impact  on the economy—NHTSA used a simpler form of uncertainty analysis,  called sensitivity analysis, rather than the more formal probability  analysis. When NHTSA performed its first probability analysis under OMB  Circular No. A-4, it took several weeks to complete and required  contracting resources outside the agency—not a typical practice for  NHTSA. In addition, to meet its statutory deadline, the agency sent the rule  to OIRA for review before completing the probability analysis. In contrast,  EPA had incorporated probability analysis into its regulatory development  process on a case-by-case basis prior to the issuance of Circular No. A-4  and therefore did not find that requirement challenging.
Officials from case-study agencies identified two long-standing analytical  and procedural requirements, the PRA regarding information collections  and the RFA regarding analysis of rules’ effects on small entities, as having  had more significant effects on time and resources than the more recent  requirements. Some officials said that these requirements add time to the  rulemaking process and may even work at cross-purposes during the  course of regulatory development. Agency officials at FDA and SEC  reported that compliance with the PRA information collection  requirements may add a year or more to the timeline of regulatory  development. As a result, rather than gather new information to support a  rulemaking, agency officials will sometimes rely on existing information,  information available from a more limited number of sources, or  information gathered through public notices. This can make it more  difficult to determine the effect of a regulation on small entities that may  not be represented by a small sample of interested parties or respond to  public notices. FDA officials stated that the agency posts on its Web site a  “Dear Colleague” letter alerting the small business community to the  rulemakings listed in the semi-annual Unified Agenda and Regulatory Plan  that may affect small business. This letter explains how to contact the  agency and encourages small businesses to become involved early in the  rulemaking process. However, it can still be difficult to determine the  effect of a regulation on small entities. According to the agency officials,  this requires agencies to either move forward with available information  or go through time-consuming approvals for information collections under  the PRA.
section_title: OIRA’s Role in the Rulemaking Process Could Be More Transparent
paragraphs: Our review of 12 DOT, EPA, and FDA rules submitted to OIRA for formal  review under Executive Order 12866 indicated that for 10 of the 12 rules,  the agencies identified OIRA changes to the rules. Using the same basic  methodology as in our 2003 report on the effect of OIRA’s review process,  we used a variety of information sources (such as agency and OIRA docket  materials and interviews with agency officials) to classify the most  significant level of changes attributed to OIRA’s review. For each of the  12 rules, we classified the level of OIRA changes into one of the following  three categories:    Significant changes. Rules in which the most significant changes affected  the scope, impact, or estimated costs and benefits of the rules as originally  submitted to OIRA. Usually, these changes were made to the regulatory  language that would appear in the Code of Federal Regulations and is  legally binding. For example, in an FDA rule on dietary supplements, OIRA  suggested a change in the regulatory language to reduce the number of  years required to save a reserve sample. However, revisions to a cost- benefit analysis could also be significant because they affect the reported  impact of a rule.
Other material changes. Rules in which the most significant changes  resulted in the addition or deletion of material in the explanatory preamble  section of the rule. For example, in a DOT rule on event data recorders,  OIRA suggested a change in the explanatory language clarifying that crash  investigators and researchers are able to download data from the  recorders.
Minor or no OIRA changes. Rules in which there were no changes made to  the draft rule, the most significant changes attributed to OIRA’s  suggestions resulted in editorial or other minor revisions, or any changes  in the rule prior to publication were not at the suggestion of OIRA.
As shown in table 2, we determined that OIRA suggested “significant”  changes for 4 of the 12 case-study rules submitted for Executive Order  12866 reviews, “other material” changes for 4 of the rules, and “minor”  changes for 2 of the rules. OIRA did not suggest any changes for the  remaining 2 rules. Of the 4 rules that had significant changes, 2 were rules  developed and promulgated by EPA and 1 each by DOT and FDA. In  addition 3 of the 4 rules with significant changes were major rules. (See  the case studies in app. II for further details on the changes made to rules  reviewed by OIRA.)
subsections: section_title: Documentation of OIRA Review Was Sometimes Incomplete
paragraphs: Executive Order 12866 requires both agencies and OIRA to disclose to the  public certain information about OIRA’s regulatory reviews. After the  regulatory action has been published in the Federal Register or otherwise  issued to the public, an agency is required to  1.  make available to the public the information provided to OIRA in  2.  3. accordance with the executive order;  identify for the public, in a complete, clear, and simple manner, the  substantive changes between the draft submitted to OIRA and the  action subsequently announced; and  identify for the public those changes in the regulatory action that were  made at the suggestion or recommendation of OIRA.
The order requires OIRA to maintain a publicly available log that includes  the following information pertinent to rules under OIRA’s review:  1.  the status of rules submitted for OIRA review,  2.  a notation of all written communications received by OIRA from  3. persons not employed by the executive branch, and  information about oral communications between OIRA and persons  not employed by the executive branch.
After the rule has been published or otherwise issued to the public (or the  agency has announced its decision to not publish or issue the rule), OIRA  is required to make available to the public all documents exchanged  between OIRA and the agency during the review by OIRA. An OIRA  official also pointed out that OIRA does not monitor, on a rule-by-rule  basis, compliance by rulemaking agencies with their disclosure obligations  under Executive Order 12866.
The case-study agencies generally met the executive order’s requirements  to disclose materials they provided to OIRA and substantive changes made  during OIRA’s review. In contrast to our study in 2003, all the agencies we  reviewed for this report had documentation of OIRA’s reviews. However,  the documentation could be improved for greater transparency. Executive  Order 12866 does not specify how agencies should document the changes  made to draft rules after their submission to OIRA, nor is there any  governmentwide guidance that directs agencies on how to do so.  Nonetheless, some of the documentation on OIRA’s changes was very  clear, but in other cases additional efforts were required to interpret the  information. As we found in 2003, the agencies did not always clearly  attribute changes made at the suggestion of OIRA, and agencies’  interpretations were not necessarily consistent regarding what constitutes  a substantive change that should be documented to comply with the  executive order transparency requirements. For example, different  departments within one agency had varied interpretations, with one office  only considering those changes made to regulatory text as substantive.  Table 3 provides summary information about the type and nature of  agencies’ documentation to address Executive Order 12866 transparency  requirements for the 12 case-study rules reviewed by OIRA. (See app. III  for examples of agencies’ OIRA review documentation.)
As we also found in 2003, agencies sometimes included more information  about OIRA’s review than required, and we found such information useful  to more clearly explain what had occurred. For example, EPA included  copies of messages from OIRA outlining suggested changes to draft rules  under review. EPA also included a memo to the docket summarizing the  subjects discussed with OIRA at a meeting about one of the case-study  rules. In the case of one rule that was unchanged by OIRA, FDA’s docket  included both an annotated copy of the rule returned to FDA and a memo  to the file noting that there were no changes to the draft rule.
In general, compared to our review in 2003, we found it more difficult to  find agencies’ documentation of OIRA’s regulatory reviews, primarily  because of difficulties using the search capabilities in the centralized  electronic Federal Docket Management System under  www.regulations.gov. Using the advanced docket search function as  instructed by the Web site user information to first find the rule, we  searched by the rule title, the RIN, and the rule Docket ID independently  and as they appeared in the published version of the final rule in the  Federal Register. Using those criteria, we were able to find all four of the  DOT case-study rules submitted for OIRA review but only one each of the  4 FDA rules and 4 EPA rules. We chose to use paper dockets when the  opportunity presented itself for the FDA case study rules.
Agencies’ labeling practices also sometimes made it difficult to find the  relevant documentation about OIRA’s reviews. Out of 12 dockets, we were  able to identify 5 of the 10 changed rules and 1 of the 2 unchanged rules by  searching the docket Web pages for “12866,” “OIRA,” and “OMB.” In  addition, while the agencies’ published rules stated that the rules had been  reviewed by OIRA under Executive Order 12866, most of the rules did not  identify whether substantive changes had been made during the OIRA  review period (and therefore documentation of the changes should be  included in the rulemaking docket). Although there is no requirement for  agencies to do so, including such additional information would be  consistent with how agencies discuss other rulemaking requirements in  published rules and potentially help readers navigate the docket. Such  information, for example, would more clearly have identified which of our  case-study rules’ dockets should include documentation of OIRA review  changes.
In response to the disclosure requirements placed on OIRA by Executive  Order 12866, OIRA’s meeting logs indicated that parties not employed by  the executive branch initiated meetings with OIRA regarding 7 of the 12  case-study rules, but we do not know what influence meeting discussions  had on OIRA recommendations because there is no requirement for OIRA  to disclose the substance of the meetings. OIRA logged a total of 10  meetings, but 2 of the meetings each concerned 2 rules. Three of these  meetings occurred before formal submission of the draft rule for OIRA  review. There were meetings on all 4 EPA case-study rules. As we found  during our review in 2003, most of the nonfederal parties appeared to be  representatives of regulated entities. In all but 2 of the meetings, the  agency issuing the regulation was represented.
section_title: OIRA Implemented Only One of Eight Prior GAO Recommendations to Improve Transparency of the Regulatory Review Process
paragraphs: In our 2003 report on the OMB/OIRA regulatory review process, we made  eight recommendations to the Director of OMB to improve the  transparency of the process. OMB implemented our recommendation to  improve the clarity of OIRA’s meeting log to better identify participants in  OMB meetings with external parties on rules under review by disclosing  the affiliations of participants. In some cases, the log also identified the  clients represented.
However, OIRA did not agree with the seven remaining recommendations  in the 2003 report and did not implement those recommendations. We  recommended that OIRA should do the following:  1.  Define the transparency requirements applicable to the agencies and  OIRA in Executive Order 12866 in such a way that they include not  only the formal review period, but also the informal review period  when OIRA says it can have its most important impact on agencies’  rules.  2.  Change OIRA’s database to clearly differentiate within the “consistent  with change” outcome category which rules were substantively  changed at OIRA’s suggestion or recommendation and which were  changed in other ways and for other reasons.  3.  Reexamine OIRA’s current policy that only documents exchanged by  OIRA branch chiefs and above need to be disclosed because most of  the documents that are exchanged while rules are under review at  OIRA are exchanged between agency staff and OIRA desk officers.  4.  Establish procedures whereby either OIRA or the agencies disclose the  reason why rules are withdrawn from OIRA review.  5.  Define the types of “substantive” changes during the OIRA review  process that agencies should disclose as including not only changes  made to the regulatory text but also other, noneditorial changes that  could ultimately affect the rules’ application (for example,  explanations supporting the choice of one alternative over another and  solicitations of comments on the estimated benefits and costs of  regulatory options).  6.  Instruct agencies to put information about changes made in a rule after  submission for OIRA’s review and those made at OIRA’s suggestion or  recommendation in the agencies’ public rulemaking dockets, and to do  so within a reasonable period after the rules have been published.  7.  Encourage agencies to use “best practice” methods of documentation  that clearly describe those changes.
We discussed the status of these open recommendations with OIRA  representatives annually since 2003 and also as part of this review, and  they confirmed that OIRA had not subsequently implemented any of the  seven remaining recommendations. As discussed above, our current  review indicated that there are still opportunities to improve transparency  for some of these topics, such as better identification of when agencies  made substantive changes to their rules as a result of the OIRA review  process, attributing the sources of changes made during the review period,  and clarifying the definition of substantive changes. Other issues covered  by our 2003 recommendations—such as OIRA informal reviews and  disclosing why rules are withdrawn from OIRA review—did not arise  during this review, but this may reflect the nature of the specific rules we  reviewed and our more limited sample of case studies.
section_title: Conclusions
paragraphs: Federal regulatory agencies issue many rules to ensure public health and  safety, protect the environment, and facilitate the effective functioning of  financial markets, among other goals. Because these rules can affect so  many aspects of citizens’ lives, it is crucial that rules be carefully  developed and considered and that rulemaking procedures be effective  and transparent. To further such goals, Congresses and Presidents have  placed many procedural and analytical requirements on the rulemaking  process over the years. While we and others have reported on agencies’  implementation of individual requirements, there has been little analysis of  the cumulative effects these requirements have on agencies’ rulemaking  processes.
Our study of broadly applicable requirements illustrated the difficulties of  evaluating the effects of regulatory requirements on the rulemaking  process with limited data. To the extent that agencies had information for  selected rules, it showed considerable variation in the time required for  issuing final rules that could not be explained by the number of regulatory  requirements, few of which were triggered. Moreover, the complexity or  magnitude of a major rule also did not explain all or most variation, as  some case-study rules were not major and took nearly as long or longer to  be published. This raises the question of what factors can account for the  variations in rule development. While our findings point to better use of  existing estimates and plans to identify opportunities to improve the  rulemaking process, agencies also recognized more can be done and, in  some cases, have taken steps to answer this question.
We found that early in their rulemaking processes each agency identified  the key milestones it needed to accomplish to produce a final rule. During  the course of our review, only DOT provided data that it routinely tracked  these milestones and reported internally and externally on the status of  milestones for development of the agency’s significant rules. However, in  comments on our draft report, EPA and FDA subsequently provided some  documentation and data on their tracking and reporting of milestones.   Although there is no right time for how long a rulemaking should take,  monitoring actual versus estimated performance enables agency managers  to identify steps in the rulemaking process that account for substantial  development time and provides information necessary to further evaluate  whether the time was well spent. Although not all factors are within an  agency’s control, some are. Agency officials we spoke with identified  several potential benefits to monitoring and reporting, including better  scheduling and increased internal and external accountability. This is also  consistent with the internal control standard that an agency must have  relevant, reliable information relating to external as well as internal  events. Additionally, officials in three of the four agencies we audited said  they would benefit from a better understanding of how staff resources are  used, even though agencies’ efforts so far have produced limited results.  Information on only one element in the rulemaking process—length of  time—cannot answer whether an agency is managing well. However, such  information can provide insights into the process, such as when it  contributed to our efforts to determine the relative burden of various  regulatory requirements.
Our review of major and case-study rules indicated that the majority of the  rules triggered only a few of the rulemaking requirements. The  requirements that rules most often triggered are among the longest  standing and broadly applicable—the PRA, the RFA, and centralized OIRA  review under Executive Order 12866. The PRA and the RFA generally  apply to all agencies and rules, and officials from each of the agencies  where we conducted case studies cited those requirements as ones that  consistently added time to the rulemaking process and required  investments of agency resources. Similarly, under Executive Order 12866,  we observed that a relatively small portion of rules submitted to OIRA for  review have economic consequences significant enough to trigger the  most rigorous analytical requirements, so any burden of compliance with  those requirements is not very widespread. The majority of rules  submitted for OIRA review (around 85 percent historically) are significant  for reasons other than their economic impact.
The case-study agencies generally met the executive order’s requirements  to disclose materials they provided for OIRA’s review and substantive  changes made during OIRA’s review. For those case-study agencies and  rules subject to OIRA review, some agency practices were more effective  than others in communicating review results. Transparency problems that  we identified in the past persist, such as incomplete attribution of changes  and inconsistent definitions of substantive changes among and within  agencies. Also, unlike when addressing other regulatory requirements— where agencies typically note in the published rule whether the rule  triggered the requirements—the agencies did not clearly identify in their  final rules when substantive changes had been made during the OIRA  review period. OIRA, as the agency responsible for providing oversight  and guidance to agencies on regulatory matters, is the principal entity in a  position to ensure consistent compliance across agencies if the  administration retains transparency requirements regarding regulatory  review.
section_title: Recommendations for Executive Action
paragraphs: We are making six recommendations to improve the monitoring and  evaluation of rules development and the transparency of the review  process.
To be consistent with internal controls for information in managing  agency operations, we recommend that for significant rules the  Commissioner of FDA and the Chairman of SEC routinely track major  milestones in regulatory development and report internally and externally  when major milestones are reached against established targets. The  Administrator of EPA, the Commissioner of FDA, and the Chairman of  SEC should each also evaluate actual performance versus the targeted  milestones and when they are different determine why.
If the current administration retains Executive Order 12866, or establishes  similar transparency requirements, we recommend that the Director of  OMB, through the Administrator of OIRA, take the following four actions  to more consistently implement the order’s requirement to provide  information to the public “in a complete, clear, and simple manner”:    define in guidance what types of changes made as a result of the OIRA  review process are substantive and need to be publicly identified,  instruct agencies to clearly attribute those changes “made at the  suggestion or recommendation of OIRA,”    direct agencies to clearly state in final rules whether they made  substantive changes as a result of the OIRA reviews, and    standardize how agencies label documentation of these changes in public  rulemaking dockets.
section_title: Agency Comments and Our Evaluation
paragraphs: We provided a draft of this report to the Department of Health and Human  Services (HHS), DOT, EPA, SEC, and OMB. We received written  comments from HHS/FDA, EPA, SEC, and OMB which are summarized  below and reprinted in appendices IV through VII. However, because EPA  and FDA provided new information as part of agency comments, we did  not analyze the information provided and conduct follow-up discussions  with agency officials prior to publication of this report. We note that we  had asked for this information during our review and the agencies did not  provide at that time. Also, they did not provide this information at the  conclusion of our review either in response to our statements of facts to  the agencies or at our exit conference with the agencies. DOT provided  only technical comments. With regard to the two recommendations  directed to the rulemaking agencies, SEC stated that the Commission is  committed to evaluating and improving all of it processes and will  consider our recommendations as part of that process.
With regard to our recommendation that for significant rules agencies  routinely track major milestones in regulatory development and report  internally and externally when major milestones are reached against  established targets, FDA commented that the scope of this  recommendation should be more narrow and flexible. Specifically, FDA  commented that: (1) the scope of tracking should be limited to only  economically significant rules because FDA cannot predict with certainty  what rules OMB will consider otherwise significant until close to rule  clearance, (2) alternative tracking approaches should be permitted since  FDA has the FRDTS that tracks the progress of all its Federal Register  documents through the latter stages of the agency’s development and  clearance process, and (3) routine reporting on when major milestones are  met should only be internal because reporting externally may mislead  stakeholders and prompt inquiries that draw resources away from the  agency’s ability to complete regulations.
While we agree that some flexibility is necessary, we disagree about  narrowing the scope of our recommendation. For example, regarding  FDA’s proposal to narrow the scope to only economically significant rules,  in this report we note that about 85 percent of all significant rules are not  economically significant, so such a limitation would drop the bulk of the  agency’s regulatory activity. Further, with regard to FDA’s point that it is  uncertain what rules OMB will deem significant, in this report we stated  that under Executive Order 12866 the agency, not OMB, has the primary  responsibility to first identify which rules are significant. Therefore, FDA  should be aware of many if not most of the rules that are deemed  significant in its inventory. For those rules that OMB deems significant  only at the latter stages of rulemaking, we recognize that tracking might  have to begin at that stage. Regarding FDA’s second point, we did not  recommend one particular system and recognize that the information in  FRDTS provides tracking data on milestones. However, we note that these  data are limited to the latter stages of the rulemaking process. Because our  review showed that the earlier developmental stages of a rule could be a  significant portion of time spent in regulatory development, there is value  in also tracking milestones in the earlier stages. Regarding FDA’s third  point, it is still important to report some information externally as well as  internally to improve the transparency and accountability of the agency’s  rulemaking process. Further, we believe that FDA’s concern about the  impact that reporting some information externally could have on agency  resources is overstated. None of the agencies we met with during this  review identified responding to public inquiries as a major factor affecting  resources and timeliness. Also, there is nothing that precludes agencies  from providing reasons for delays when externally reporting this  information to reduce the volume of public inquiries. Therefore, we kept  this recommendation addressed to FDA.
With regard to our second recommendation that agencies should also  evaluate actual performance versus the targeted milestones, FDA stated  that the agency is already engaged in quality improvement efforts for its  rulemaking process. Specifically, FDA said that its Policy Council has  quarterly meetings with the agency components and the agency  periodically reviews its rulemaking processes to see if changes are needed.  Also, FDA noted that 12 such reviews have been completed since 1981,  and identified two recent pilot projects resulting from these reviews.
However, although FDA said the agency conducted general evaluations  and provided some examples, FDA did not provide information showing  that the agency had specifically evaluated the issue highlighted in our  recommendation. To the extent that FDA has not, we would still  recommend that they specifically evaluate the reasons for any  discrepancies between projected and actual milestones for their  significant rulemakings. Therefore, we kept this recommendation  addressed to FDA. We revised the body of the report where appropriate in  response to the additional information FDA provided in its comments.
Regarding our recommendation that agencies routinely track major  milestones and report internally and externally when major milestones are  reached, EPA clarified that the agency currently tracks key milestones  associated with the rulemaking process and reports this information  internally and externally. Specifically, EPA cited RAPIDS, an internal  tracking system that monitors cross-agency involvement and senior  management reviews. EPA also cited three primary sources for external  reporting, specifically its use of Action Initiation Lists, the Semiannual  Regulatory Agenda, and a quarterly report which they subsequently  identified as EPAStat.
Based on the new information and subsequent documentation that we  requested from EPA in response to the agency’s comments, we concur that  EPA has a tracking system and internal and external reporting  mechanisms that appear to address our recommendation. Therefore, we  removed this recommendation to EPA. For example, EPA’s RAPIDS tracks  information on numerous milestones on all phases of the rulemaking  process. Further, RAPIDS tracks information on rules that are both  economically significant and significant. Similarly, with regard to internal  and external reporting, EPA cited three main sources the agency uses for  external reporting of milestones. We modified the body of the report to  incorporate the new information. We note, however, that we had  requested this information during our review and, because the information  was not provided at the time of our review, we did not have the  opportunity to discuss how the information is used, whether it is useful,  and, most importantly, if it could be used to respond to our report  objectives. We did not audit the new information provided because of the  approaching deadline for OMB to provide recommendations to the  President for a new executive order on federal agency regulatory review.
While not specifically addressing our second recommendation that  agencies should also evaluate actual performance versus the targeted  milestones, EPA comments indicated that agency executives and  managers routinely meet to review milestones on key regulations and  review program performance. Specifically, EPA noted that actions that are  completed on time or early are used by the agency as examples of best  practices and actions that are off-track are identified early and corrective  steps are taken to expedite their completion. Because we were unaware of  this system or its use at the time of our review, we could not determine  whether EPA specifically evaluated discrepancies between projected and  actual milestones to determine reasons why and took corrective actions.  No evidence was provided to draw a conclusion. Therefore, we kept this  recommendation addressed to EPA.
With regard to our four recommendations to OMB to more consistently  implement the Executive Order 12866 requirement that agencies provide  information to the public in a complete, clear, and simple manner, OMB  stated that these recommendations have merit and warrant further  consideration. In particular, OMB stated that it will give full consideration  to the report and its recommendations as the agency finalizes its  recommendations to the President for a new Executive Order on  regulatory review. OMB also said that the report will remind rulemaking  agencies of their responsibility to identify in a complete, clear, and simple  manner the substantive changes between the draft rule submitted to OIRA  for review and the action subsequently announced, and to identify those  changes in the regulatory action that were made at the suggestion or  recommendation of OIRA.
We also received technical comments and clarifications which we  incorporated into this report, where appropriate. EPA provided a  substantive technical comment regarding our classifications of the level of  OIRA changes for three of the case study rules. In light of the clarifying  comments EPA provided, we revised our classification of the Ethylene  Oxide Emissions rule from “significant changes” to “other material  changes.” However we did not reclassify the other two EPA rules because  the changes suggested would not be consistent with the methodology and  criteria we used in this and prior reviews of the OIRA regulatory review  process.
As agreed with your office, unless you publicly announce the contents of  this report earlier, we plan no further distribution until 30 days from the  report date. At that time, we will send copies to appropriate congressional  committees, the Secretary of Health and Human Services, the Secretary of  Transportation, the Administrator of EPA, the Chairman of SEC, and the  Director of OMB. The report also will be available at no charge on the  GAO Web site at http://www.gao.gov.
If you or your staff members have any questions about this report, please  contact me at (202) 512-6806 or fantoned@gao.gov. Contact points for our  Offices of Congressional Relations and Public Affairs may be found on the  last page of this report. GAO staff who made major contributions to this  report are listed in appendix VIII.
section_title: Appendix I: Summary of Common Regulatory Requirements
paragraphs: In this appendix, we provide information on commonly applicable  regulatory requirements established by statutes and executive orders. We  included those requirements identified by 10 or more of the rules we  reviewed for this report or that were relevant to our case-study rules. We  list the requirements within each major section (statutory requirements  and executive orders) in chronological order. For each requirement, the  following paragraphs summarize the general purpose, applicability and  requirements imposed by the initiatives that were relevant to the rules we  examined for this report.
subsections: section_title: Statutory Requirements
subsections: section_title: Administrative Procedure Act
paragraphs: The Administrative Procedure Act (APA) was enacted in 1946 and  established the basic framework of administrative law governing federal  agency action, including rulemaking. Section 553 of Title 5, United States  Code, governs “notice-and-comment” rulemaking, also referred to as  “informal” or “APA rulemaking.” Section 553 generally requires   (1) publication of a notice of proposed rulemaking, (2) opportunity for  public participation in the rulemaking by submission of written comments,  and (3) publication of a final rule and accompanying statement of basis  and purpose not less than 30 days before the rule’s effective date.  Congresses and Presidents have taken a number of actions to refine and  reform this regulatory process since the APA was enacted.
section_title: National Environmental Policy Act of 1969
paragraphs: The National Environmental Policy Act (NEPA) requires agencies to  consider the potential impact on the environment of federal agency action,  including regulations. NEPA directs all agencies of the federal  government to include in proposals for “major Federal actions  significantly affecting the quality of the human environment” a detailed  environmental impact statement addressing certain listed subjects and  applying substantive criteria set forth in the Act.
section_title: Federal Advisory Committee Act
paragraphs: The Federal Advisory Committee Act (FACA) regulates the formation and  operation of advisory committees by federal agencies. Advisory  committees, normally comprising of experts in the regulatory field  involved, representatives of affected interest groups, and representatives  of federal and state agencies, generally advise agencies on the content of  rulemaking or on issues while the rulemaking is in progress. Some statutes  require the agencies to use advisory committees, and others authorize but  do not require their use.
section_title: Endangered Species Act of 1973
paragraphs: The Endangered Species Act seeks to protect species of animals against  threats to their continuing existence caused by man. Under section 7 of  the Act, each federal agency, “in consultation with and with the assistance  of the Secretary” of the Interior shall ensure that any regulation issued by  that agency not jeopardize the continued existence of any endangered or  threatened species. 16 U.S.C. § 1536(a)(2).
section_title: Regulatory Flexibility Act
paragraphs: The Regulatory Flexibility Act (RFA) was enacted in response to concerns  about the effect that federal regulations can have on small entities. The  RFA requires independent and other regulatory agencies to assess the  impact of their rules on “small entities,” defined as including small  businesses, small governmental jurisdictions, and certain small not-for- profit organizations. Under the RFA, an agency must prepare an initial  regulatory flexibility analysis at the time proposed rules are issued, unless  the head of the agency certifies that the proposed rule would not have a  “significant economic impact upon a substantial number of small entities.”  5 U.S.C. § 605(b). The analysis must include a consideration of regulatory  alternatives that accomplish the stated objectives of the proposed rule and  that minimize any significant impact on such entities. However, the RFA  only requires consideration of such alternatives and an explanation of why  alternatives were rejected; the Act does not mandate any particular  outcome in rulemaking. After the comment period on the proposed rule is  closed, the agency must either certify a lack of impact, or prepare a final  regulatory flexibility analysis, which among other things, responds to  issues raised by public comments on the initial regulatory flexibility  analysis. The agencies must make the final analysis available to the public  and publish the analysis or a summary of it in the Federal Register. The  Act also requires agencies to ensure that small entities have an  opportunity to participate in the rulemaking process and requires the  Chief Counsel of the Small Business Administration’s Office of Advocacy  to monitor agencies’ compliance. The RFA applies only to rules for which  an agency publishes a notice of proposed rulemaking (or promulgates a  final interpretative rule involving the internal revenue laws of the United  States), and it does not apply to ratemaking.
section_title: Paperwork Reduction Act of 1980
paragraphs: The Paperwork Reduction Act (PRA) requires agencies to justify any  collection of information from the public to minimize the paperwork  burden they impose and to maximize the practical utility of the  information collected. The Act applies to independent and other  regulatory agencies. Under the PRA, agencies are required to submit all  proposed information collections to the Office of Information and  Regulatory Affairs (OIRA) in the Office of Management and Budget  (OMB). Information collections generally cover information obtained  from more than ten sources. In their submissions, agencies must  establish the need and intended use of the information, estimate the  burden that the collection will impose on respondents, and show that the  collection is the least burdensome way to gather the information.  Generally, the public must be given a chance to comment on proposed  collections of information. 44 U.S.C. § 3506(c), 5 C.F.R. § 1320.11. At the  final rulemaking stage, no additional public notice and opportunity for  comment is required, although OMB may direct the agency to publish a  notice in the Federal Register notifying the public of OMB review.
section_title: Negotiated Rulemaking Act of 1990
paragraphs: The Negotiated Rulemaking of 1990 (NRA) established a statutory  framework for agency use of negotiated rulemaking to formulate proposed  regulations. The NRA supplements the rulemaking provisions of the APA,  clarifying the authority of federal agencies to conduct negotiated  rulemaking. Generally, in a negotiated rulemaking, representatives of the  agency and the various affected interest groups get together and negotiate  the text of a proposed rule.
section_title: Unfunded Mandates Reform Act of 1995
paragraphs: The Unfunded Mandates Reform Act (UMRA) was enacted to address  concerns about federal statutes and regulations that require nonfederal  parties to expend resources to achieve legislative goals without being  provided funding to cover the costs. UMRA generates information about  the nature and size of potential federal mandates but does not preclude  the implementation of such mandates. UMRA applies to proposed federal  mandates in both legislation and regulations, but it does not apply to rules  published by independent regulatory agencies. With regard to the  regulatory process, UMRA generally requires federal agencies to prepare a  written statement containing a “qualitative and quantitative assessment of  the anticipated costs and benefits” for any rule that includes a federal  mandate that may result in the expenditure of $100 million or more in any  1 year by state, local, and tribal governments in the aggregate, or by the  private sector. For such rules, agencies are to identify and consider a  reasonable number of regulatory alternatives and from those select the  least costly, most cost-effective, or least burdensome alternative that  achieves the objectives of the rule (or explain why that alternative was not  selected). UMRA also includes a consultation requirement; agencies must  develop a process to permit elected officers of state, local, and tribal  governments (or their designees) to provide input in the development of  regulatory proposals containing significant intergovernmental mandates.  UMRA applies only to rules for which an agency publishes a notice of  proposed rulemaking.
section_title: National Technology Transfer and Advancement Act of 1995
paragraphs: The National Technology Transfer and Advancement Act (NTTAA) directs  federal agencies to use voluntary consensus standards in their regulatory  activities unless the agency provides Congress, through OMB, with an  explanation of why using these standards would be inconsistent with  applicable law or otherwise impracticable. Voluntary consensus  standards are technical standards (e.g., specifications of materials,  performance, design, or operation; test methods; sampling procedures;  and related management systems practices) that are developed or adopted  by voluntary consensus standards bodies.
section_title: Small Business Regulatory Enforcement Fairness Act
paragraphs: Congress amended the RFA in 1996 by enacting the Small Business  Regulatory Enforcement Fairness Act (SBREFA).  SBREFA included  judicial review of compliance with the RFA. SBREFA requires agencies to  develop one or more compliance guides for each final rule or group of  related final rules for which the agency is required to prepare a regulatory  flexibility analysis. SBREFA also requires the Environmental Protection  Agency and the Occupational Safety and Health Administration to convene  advocacy review panels before publishing an initial regulatory flexibility  analysis.
section_title: Congressional Review Act
paragraphs: The Congressional Review Act (CRA) was enacted as part of SBREFA in  1996 to better ensure that Congress has an opportunity to review, and  possibly reject, rules before they become effective. CRA established  expedited procedures by which members of Congress may disapprove  agencies’ rules by introducing a resolution of disapproval that, if adopted  by both Houses of Congress and signed by the President, can nullify an  agency’s rule. CRA applies to rules issued by independent and other  regulatory agencies. CRA requires agencies to file final rules with both  Congress and GAO before the rules can become effective. GAO’s role  under CRA is to provide Congress with a report on each major rule (for  example, rules with a $100 million impact on the economy) including  GAO’s assessment of the issuing agency’s compliance with the procedural  steps required by various acts and executive orders governing the  rulemaking process.
section_title: Information Quality Act
paragraphs: In 2000, the Information Quality Act (IQA) was added as an amendment to  the PRA. IQA applies to the same agencies that are subject to the PRA;  the Act applies to independent and other regulatory agencies. The IQA  requires every agency to issue guidelines, with OMB oversight, to ensure  and maximize the quality, objectivity, utility, and integrity of information  disseminated by the agency. Agencies must also establish administrative  mechanisms allowing affected persons to seek and obtain correction of  information maintained and disseminated by the agency.
On December 16, 2004, OMB issued the Information Quality Bulletin for  Peer Review under the IQA and other authority. The Bulletin establishes  minimum standards for when peer review is required for scientific  information, including stricter minimum standards for the peer review of  “highly influential” scientific assessments. The Bulletin also establishes the  types of peer review that should be considered by agencies in different  circumstances. The Bulletin applies to independent and other regulatory  agencies. Agencies must conduct any required peer reviews early enough  to allow the agency to plan its regulatory approaches. “When an  information product is a critical component of rule-making, it is important  to obtain peer review before the agency announces its regulatory options  so that any technical corrections can be made before the agency becomes  invested in a specific approach or the positions of interest groups have  hardened.” 70 Fed. Reg. 2668. The result of a peer review is a report, which  agencies must consider making available to potential commenters in the  rulemaking process. “If an agency relies on influential scientific  information or a highly influential scientific assessment . . . the agency  shall include in the administrative record for that action a certification that  explains how the agency has complied with the requirements of this  Bulletin.” 70 Fed. Reg. 2673.
section_title: E-Government Act of 2002
paragraphs: The E-Government Act of 2002 was intended to enhance the management  and promotion of electronic government services and processes. With  regard to the regulatory process, the Act requires agencies, to the extent  practicable, to accept public comments on proposed rules by electronic  means and to ensure that publicly accessible federal Web sites contain  electronic dockets for their proposed rules, including all comments  submitted on the rules and other relevant materials.
section_title: Executive Orders
paragraphs: In addition to congressional regulatory reform initiatives enacted in  statutes, presidential initiatives have a key role in the regulatory process.  In fact, centralized review of agencies’ regulations within the Executive  Office of the President has been part of the rulemaking process for more  than 30 years.
subsections: section_title: Executive Order 12372 – Intergovernmental Review of Federal Programs
paragraphs: This executive order generally requires federal agencies to consult with  state and local elected officials on regulations involving Federal financial  assistance or Federal development that would have an impact on State and  local finances.
section_title: Executive Order 12630 -- Governmental Actions and Interference with Constitutionally Protected Property Rights
paragraphs: This executive order requires agencies to limit interference with private  property rights protected under the Fifth Amendment to the Constitution.  Agencies must include an analysis of the impact of proposed regulations  on property rights in its submissions to OMB.
section_title: Executive Order 12866 – Regulatory Planning and Review
paragraphs: The formal process by which OIRA currently reviews agencies’ proposed  rules and final rules is essentially unchanged since Executive Order 12866  was issued in 1993. Under Executive Order 12866, OIRA reviews  significant proposed and final rules from agencies, other than independent  regulatory agencies, before they are published in the Federal Register.
The executive order states, among other things, that agencies should  assess all costs and benefits of available regulatory alternatives, including  both quantitative and qualitative measures. It also provides that agencies  should generally select regulatory approaches that maximize net benefits  (unless a statute requires another approach). Among other principles, the  executive order encourages agencies to tailor regulations to impose the  least burden on society needed to achieve the regulatory objectives. The  executive order also established agency and OIRA responsibilities in the  review of regulations, including transparency requirements. OIRA provides  guidance to federal agencies on implementing the requirements of the  executive order, such as guidance on preparing economic analyses  required for significant rules in OMB Circular No. A-4.
OMB Circular No. A-4  On September 17, 2003, OMB issued OMB Circular No. A-4, Regulatory  Analysis, which is a guide for preparing the economic analysis of  significant regulatory action called for by the Executive Order. OMB  designed the guidelines to help agencies conduct “good regulatory  analyses” and to standardize the way that benefits and costs of regulations  are measured and reported. The guidelines define a good regulatory  analysis as one that includes a statement of the need for the proposed  regulation, an assessment of alternatives, and an evaluation of the benefits  and costs of the alternatives. The guidelines state that the motivation of  the evaluation is to learn if the benefits of an action are likely to justify the  costs, or discover which of the possible alternatives would be the most  cost-effective. According to OIRA, this Circular contains several significant  changes from previous OMB guidance, including (1) more emphasis on  cost-effectiveness analysis, (2) formal probability analysis for rules with  more than a billion-dollar impact on the economy and (3) more systematic  evaluation of qualitative as well as quantified benefits and costs.
section_title: Executive Order 12898 – Federal Actions to Address Environmental Justice in Minority Populations and Low- Income Populations
paragraphs: This executive order requires each agency to develop an “environmental  justice strategy... that identifies and addresses disproportionately high and  adverse human health or environmental effects of its programs, policies,  and activities on minority populations and low-income populations.”  Each agency must identify rules that should be revised to meet the  objectives of the executive order.
section_title: Executive Order 12988 – Civil Justice Reform
paragraphs: This executive order requires agencies to draft regulations in a manner  that will reduce needless litigation by ensuring the clarity of regulatory  language regarding legal rights and obligations. For example, the order  requires agencies to draft regulations that provide a clear legal standard  for affected conduct rather than a general standard, and promote  simplification and burden reduction.
section_title: Executive Order 13045 – Protection of Children from Environmental Health Risks and Safety Risks
paragraphs: This executive order requires that agencies issuing “economically  significant” rules that also concern an environmental health risk or safety  risk that an agency has reason to believe may disproportionately affect  children must submit to OIRA an evaluation of the environmental health or  safety effects of the planned regulation on children. Agencies must also  include an explanation of why the planned regulation is preferable to other  potentially effective and reasonably feasible alternatives considered by the  agencies.
section_title: Executive Order 13132 – Federalism
paragraphs: This executive order requires agencies to prepare a federalism summary  impact statement for actions that have federalism implications.  Specifically, it provides that “no agency shall promulgate any regulation  that has federalism implications,  that imposes substantial direct  compliance costs on state and local governments,” unless the agency   (1) has consulted with state and local officials early in the process,   (2) submitted to OMB copies of any written communications from such  officials, and (3) published in the preamble of the rule “a federalism  summary impact statement” describing the consultations, “a summary of  the nature of  concerns and the agency’s position  supporting the need to issue the regulations, and a statement of the extent  to which the concerns of State and local officials have been met.”
section_title: Executive Order 13175 – Consultation and Coordination with Indian Tribal Governments
paragraphs: This executive order provides that “no agency shall promulgate any  regulation that has tribal implications” unless the agency (1) has consulted  with tribal officials early in the process, (2) submitted to OMB copies of  any written communications from such officials, and (3) published in the  preamble of the rule “a tribal summary impact statement” describing the  consultations, “a summary of the nature of their concerns and the agency’s  position supporting the need to issue the regulation, and a statement of the  extent to which the concerns of tribal officials have been met.” On issues  relating to tribal self-government, tribal trust resources, or Indian tribal  treaty and other rights, each agency should explore and, where  appropriate, use consensual mechanisms for developing regulations,  including negotiated rulemaking.
section_title: Executive Order 13211 – Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use
paragraphs: This executive order requires agencies to prepare and submit to OMB a  “Statement of Energy Effects” for significant energy actions. The  statement must cover the regulation’s “adverse effects on energy supply,  distribution, or use (including a shortfall in supply, price increases, and  increased use of foreign supplies)” and reasonable alternatives and their  effects. The “Statement of Energy Effects” must be published (or  summarized) in the related proposed and final rule.
section_title: Appendix II: Case Studies of 16 Selected Rules
paragraphs: This appendix provides case studies on 16 final rules published between  January 2006 and May 2008 that we reviewed for this report. At the  beginning of each case study the official rule title as published in the  Federal Register is followed by a short title that we used to identify the  rule in the body of our report. The body of each case study includes  identifying information, a brief summary or synopsis of the rule, a  discussion of the regulatory requirements addressed in the final rule, a  summary of the changes to the rule resulting from reviews of the draft rule  by the Office of Management and Budget’s (OMB) Office of Information  and Regulatory Affairs (OIRA) (if applicable), and a timeline of important  events in the course of the rulemaking.
Identifying Information. Identifies the responsible federal agency, and  other unique identifying information, such as the Regulation Identifier  Number (RIN), the citation in the Federal Register of the final rule, and the  docket number in www.regulations.gov.
Rule Synopsis. Provides summary information about the substance and  effects of the rule, such as the intent or purpose of the rule, a brief  discussion of the rule’s origin, rulemaking history, or regulatory authority  upon which the rule was created.
Regulatory Requirements Addressed in the Final Rule. Identifies generally-  applicable rulemaking requirements discussed by the agency in the final  rule as published in the Federal Register and either what additional  actions were taken to comply with the triggered requirement or why the  requirement was not triggered. For economically significant rules that  triggered the requirement under Executive Order 12866, we identified if  the agency prepared a cost-benefit analysis, and if applicable, we also  summarize the actions the agency took to address recent changes to  regulatory requirements made by OMB since 2003.
Changes Resulting from OIRA Review. Describes changes to rules that  were recommended by OIRA during OIRA’s review of the rulemaking  under Executive Order 12866.
Timeline. Identifies key dates such as the dates OIRA received and  completed its reviews, the publication dates of the proposed and final  rules in the Federal Register, the date the public comment period ended,  and other dates mentioned or tracked by agency officials.
subsections: section_title: National Air Tour Safety Standards (Air Tour Safety)
subsections: section_title: Identifying Information
section_title: Rule Synopsis
paragraphs: The rule sets safety standards governing commercial air tours. The  objective of the rule is to provide a higher and uniform level of safety for  all commercial air tours. The rule includes provisions requiring that  passengers be briefed on safety procedures, such as opening exits, exiting  the aircraft, and using life preservers. It requires that passengers in  helicopters and planes operating over open water wear life preservers, and  that helicopters operating over open water be equipped to float. It also  gives relief from drug and alcohol testing for four air tour charity events  per year, and increases the required prior flight time for pilots in those  events from 200 to 500 hours. Air tours frequently take place in heavy air  traffic and in areas geographically limited in size with dangerous natural  obstructions. Better oversight of the industry was recommended by the  National Transportation Safety Board, reports of the Department of  Transportation (DOT) Inspector General, and GAO.
section_title: Regulatory Requirements Addressed in the Final Rule
paragraphs: FAA discussed the following generally-applicable statutes and executive  orders in the final rule:    NEPA: FAA concluded that the rule qualified for a categorical exclusion  from NEPA and that the rule does not involve any significant impacts to  the human environment.
PRA: The rule included new information collections for which FAA  completed and submitted an Information Collection Request to OIRA for  approval.
RFA: FAA determined that the rule will have a significant economic  impact on a substantial number of small entities and prepared a final  regulatory flexibility analysis.
Trade Agreements Act: FAA assessed the potential effect of the rule and  determined that it would have only a domestic impact and therefore no  effect on any international trade-sensitive activity.
UMRA: FAA determined that the rule would not result in any 1-year  expenditure by state, local, and tribal governments, in the aggregate, or by  the private sector that would meet or exceed the relevant threshold of  $128.1 million.
Executive Order 12866 (Regulatory Planning and Review): FAA identified  the rule as a significant regulatory action as defined by the executive order  because it raised novel policy issues. FAA conducted an economic analysis  and submitted the rule to OIRA for review.
Executive Order 13132 (Federalism): FAA determined that the rule did not  have a substantial direct effect on the states, on the relationship between  the national government and the states, or on the balance of power and  responsibilities among the various levels of government. Therefore, FAA  concluded that the rule did not have federalism implications.
Executive Order 13211 (Actions Concerning Regulations That Significantly  Affect Energy Supply, Distribution, or Use): FAA determined that the rule  was not a significant energy action under the executive order because it  was not likely to have a significant adverse effect on the supply,  distribution, or use of energy.
section_title: Changes Resulting from OIRA Review
paragraphs: There was a significant change to the regulatory text. The rule language  was changed to clarify that four charitable or non-profit events, with no  event lasting more than 3 consecutive days, was the limit, rather than four  of each in one calendar year. There were also a number of other material  changes to the rule. OIRA requested the addition of a chart or matrix  explaining the changes made by this rule. OIRA requested the inclusion of  an explanation of the policy of a four-event limit on charity and nonprofit  event flights. OIRA questioned the source used for support of a  requirement that pilots flying charity, nonprofit or community event flights  have 500 hours total flying time. FAA added an explanation to the rule.  OIRA requested clarification of differences between “Operations  Specification” and a “Letter of Authorization.” FAA rewrote the rule  section to clarify the differences. OIRA requested FAA more fully explain  the effect of the rule on operations at the Grand Canyon. FAA added three  sentences to the preamble. OIRA changed the rule at both the proposed  and final rule stages.
section_title: Timeline
paragraphs: January 2, 2002: Preliminary team concurrence on proposed rule.    January 2, 2002: Economic evaluation of proposed rule.    November 2, 2002: Final team concurrence on proposed rule.    December 9, 2002: Director’s concurrence on proposed rule.    January 8, 2003: First internal level concurrence on proposed rule.    January 30, 2003: Second FAA internal level concurrence on proposed  rule.
February 5, 2003: Draft proposed rule transmitted to the Office of the  Secretary of Transportation (OST).
July 8, 2003: OST approved draft proposed rule.    July 10, 2003: OIRA received draft proposed rule.    October 7, 2003: OIRA completed review of proposed.
October 9, 2003: Issuance of proposed rule.    October 22, 2003: Proposed rule published in the Federal Register.    October 21, 2005: Preliminary team concurrence on final rule.    November 21, 2005: Principal’s briefing on final rule.    January 19, 2006: Economic evaluation of final rule.    March 27, 2006: Final team concurrence on final rule.    April 5, 2006: Director’s concurrence on final rule.    April 6, 2006: First internal level concurrence on final rule.    April 25, 2006: Second FAA internal level concurrence on final rule.    April 27, 2006: Transmittal to the OST of final rule.    August 16, 2006: OST approval of draft final rule.    August 16, 2006: Transmittal to OIRA of final rule.    September 21, 2006: Meeting between OIRA and nonfederal parties  regarding the rule.
November 7, 2006: OIRA approval of final rule.    December 22, 2006: Issuance of final rule.    February 13, 2007: Final rule published in the Federal Register.
section_title: Human Space Flight Requirements for Crew and Space Flight Participants (Human Space Flight Requirements)
subsections: section_title: Identifying Information
section_title: Rule Synopsis
paragraphs: The rule establishes requirements for human space flight, with the intent  of providing an acceptable level of safety to the general public and  ensuring individuals on board are aware of the risks associated with  launch and reentry. The rule sets training and medical standards for the  crew, and requires the operator to inform each space flight participant in  writing of the risks of launch and reentry. Security requirements in the rule  prevent participants from carrying certain items on board, and safety  requirements in the rule require participants be trained before flight on  how to respond to an emergency situation.
section_title: Regulatory Requirements Addressed in the Final Rule
paragraphs: FAA discussed the following generally-applicable statutes and executive  orders in the final rule:    NEPA: FAA concluded that the rule qualified for a categorical exclusion  from the requirement for preparation of an environmental assessment or  environmental impact statement.
PRA: The rule included new information collections for which FAA  completed and submitted an Information Collection Request to OIRA for  approval.
RFA: The FAA Administrator certified that the rule will not have a  significant economic impact on a substantial number of small entities.
Trade Agreements Act: FAA assessed the potential effect of the rule and  determined that it will impose the same costs on domestic and  international entities and thus has a neutral trade impact.
UMRA: FAA determined that the rule would not result in any 1-year  expenditure by state, local and tribal governments, in the aggregate, or by  the private sector that would meet or exceed the relevant threshold of  $120.7 million.
Executive Order 12866 (Regulatory Planning and Review): FAA identified  the rule as a significant regulatory action as defined by the executive order  because it raised novel policy issues. FAA conducted an economic analysis  and submitted the rule to OIRA for review.
Executive Order 13132 (Federalism): FAA determined that the rule did not  have a substantial direct effect on the states, on the relationship between  the national government and the states, or the balance of power and  responsibilities among the various levels of government. Therefore, FAA  concluded that the rule did not have federalism implications.
Executive Order 13211 (Actions Concerning Regulations That Significantly  Affect Energy Supply, Distribution, or Use): FAA determined that the rule  was not a significant energy action under the executive order because it  was not likely to have a significant adverse effect on the supply,  distribution, or use of energy.
section_title: Changes Resulting from OIRA Review
paragraphs: There were no substantive changes to this rule resulting from OIRA  review.
section_title: Timeline
paragraphs: March 22, 2005: Preliminary team concurrence on proposed rule.    April 25, 2005: Economic evaluation of proposed rule.
April 29, 2005: Principal’s briefing on proposed rule.    May 31, 2005: Final team concurrence on proposed rule.    June 17, 2005: Director’s concurrence on proposed rule.    July 12, 2005: Legal concurrence on proposed rule.    July 24, 2005: Office of the FAA Administrator concurrence on proposed  rule.
July 28, 2005: Proposed rule transmitted to OST.    September 23, 2005: OST approval of proposed rule.    September 28, 2005: OIRA received draft proposed rule.    December 22, 2005: OIRA completed review of draft proposed rule without  change.
December 22, 2005: Issuance of proposed rule.    December 29, 2005: Proposed rule published in the Federal Register.    March 24, 2006: Preliminary team concurrence on final rule.    April 6, 2006: Economic evaluation of final rule.    April 27, 2006: Final team concurrence on final rule.    May 5, 2006: Director’s concurrence on final rule.    May 26, 2006: Final rule transmitted to OST.    August 29, 2006: OST approval of final rule.    August 29 2006: OIRA received draft final rule.    November 9, 2006: OIRA completed review of draft final rule without  change.
December 1, 2006: Issuance of final rule.    December 15, 2006: Final rule published in the Federal Register.
section_title: Light Trucks, Average Fuel Economy; Model Years 2008-2011 (Fuel Economy-Light Trucks)
subsections: section_title: Identifying Information
section_title: Rule Synopsis
paragraphs: The rule reforms the structure of the corporate average fuel economy  (CAFE) program for light trucks and establishes higher CAFE standards  for model years 2008 through 2011. While this rule was proposed in 2005  and finalized in 2006, it was preceded by a series of rules establishing fuel  economy standards for light trucks (i.e., non-passenger automobiles) that  date back to the 1970s. The rule was mandated by the Energy Policy  Conservation Act of 1975.
section_title: Regulatory Requirements Addressed in the Final Rule
paragraphs: NHTSA discussed the following generally-applicable statutes and  executive orders in the final rule:    NEPA: NHTSA prepared an environmental assessment for the rule and  concluded that the rule will not have a significant effect on the quality of  the human environment.
NTTAA: NHTSA consulted with voluntary consensus standards bodies and  incorporated industry standards and definitions, such as an industry  standard on light truck footprint.
PRA: The rule included new information collections for which NHTSA  completed and submitted an Information Collection Request to OIRA for  approval.
RFA: NHTSA’s Deputy Administrator certified that the rule did not have a  significant economic impact on a substantial number of small entities.    UMRA: NHTSA determined that the rule would not result in any 1-year  expenditure by state, local and tribal governments, in the aggregate, of  more than $115 million, but would result in the expenditure of that  magnitude by the private sector. NHTSA concluded that it was required by  statute to set standards at the maximum feasible level achievable by  manufacturers, and thus could not consider regulatory alternatives.
Executive Order 12866 (Regulatory Planning and Review): NHTSA  identified the rule as a significant regulatory action as defined by the  executive order because of its economic significance. Therefore, NHTSA  conducted an economic analysis and submitted the rule to OIRA for  review.
Executive Order 12988 (Civil Justice Reform): NHTSA determined that the  rule does not have any retroactive effect.
Executive Order 13045 (Protection of Children from Environmental Health  Risks and Safety Risks): NHTSA determined that the rule does not have a  disproportionate effect on children.
Executive Order 13132 (Federalism): NHTSA stated that the statutory  authorization for the rule has a broad preemption provision, and therefore,  the agency was required to establish these standards by law.
Executive Order 13211 (Actions Concerning Regulations That Significantly  Affect Energy Supply, Distribution, or Use): NHTSA determined that the  rule would not have any adverse energy effects.
OMB Peer Review Bulletin: NHTSA convened a panel of three external  experts to review the model used in the rule. The peer review reports and  the agency’s response to reviews were included in the rulemaking docket.
section_title: Recent Analytic Requirements Addressed
paragraphs: NHTSA’s regulatory impact analysis addressed two of the four analytical  changes in the OMB economic guidelines that GAO reviewed for this  study. For example, the agency assessed uncertainty using a formal  probability analysis and discounted potential future benefits and costs  using discount rates of 7 percent and 3 percent, as directed by the OMB  guidelines. Agency officials said that conducting the probability analysis  was time-consuming, requiring one full-time analyst about 6 weeks to  complete. In addition, the officials said, the probability analysis was  conducted after the agency had selected the preferred regulatory  alternative, and as a result, the analysis was not used for decision-making  purposes. The agency did not evaluate qualitative and quantitative benefits  and costs because it monetized all the key impacts and the agency’s  analysis did not emphasize cost-effectiveness.
section_title: Changes Resulting from OIRA Review
paragraphs: NHTSA did not consider substantive any of the changes made to either the  draft proposed or draft final rules during the formal review period, and  thus did not docket a record of changes made during the OIRA review  period.
section_title: Timeline
paragraphs: 1974: DOT/EPA reported to Congress on motor vehicle fuel economy  standards.    1975: Energy Policy Conservation Act of 1975 enacted.    December 29, 2003: NHTSA issued an Advanced Notice of Proposed  Rulemaking under a different RIN (2127-AJ17) soliciting comments on the  structure of the CAFE program and an intent to reform the light truck  CAFE program.
July 26, 2005: OIRA received the draft proposed rule.    August 22, 2005: OIRA completed review of the draft proposed rule with  change.
August 30, 2005: Proposed rule published in the Federal Register.    March 14, 2006: OIRA staff met with outside parties to discuss this rule.    March 23, 2006: OIRA received the draft final rule.    March 28, 2006: OIRA completed review of the draft final rule consistent  with change.
April 6, 2006: Final rule published in the Federal Register.
section_title: Event Data Recorders
subsections: section_title: Identifying Information
paragraphs: Agency: Department of Transportation, National Highway Traffic Safety    Rule classification: Other Significant    RIN: 2127-AI72    Federal Register citation: 71 Fed. Reg. 50,998    Regulations.gov docket number: NHTSA-2004-18029 (proposed rule);  NHTSA-2006-25666 (final rule)
section_title: Rule Synopsis
paragraphs: The rule establishes standards for the auto industry practice of installing  event data recorders (EDR) in passenger cars and other light vehicles. The  intent of the rule is to standardize data obtained through EDRs so that  data may be most effective and ensure that EDR infrastructure develops to  provide a foundation for automatic crash notification. The rule requires a  minimum set of specified data elements, standardizes data format, helps  ensure crash survivability of an EDR and its data, and ensures commercial  availability of tools necessary to enable crash investigators to retrieve data  from the EDR. The rule also requires vehicle manufacturers to describe  the function and capability of an EDR in the owner’s manual of any vehicle  equipped with an EDR to ensure public awareness. NHTSA promulgated  the rule following years of study by NHTSA and the National  Transportation Safety Board, and after having received three citizen  petitions.
section_title: Regulatory Requirements Addressed in the Final Rule
paragraphs: NHTSA discussed the following generally-applicable statutes and  executive orders in the final rule:    NEPA: NHTSA determined that the rule will not have any significant  impact on the quality of the human environment.
NTTAA: NHTSA adopted voluntary consensus standards where  practicable.
PRA: The rule did not contain any new information collection requests.    RFA: NHTSA’s Administrator certified that the rule would not have a  significant economic impact on a substantial number of small entities.
UMRA: NHTSA determined that the rule would not result in the  expenditure by state, local, or tribal governments, in the aggregate, or by  the private sector, of more than the annual threshold of $118 million.
Executive Order 12866 (Regulatory Planning and Review): NHTSA  identified the rule as a significant regulatory action as defined by the  executive order. NHTSA conducted an economic analysis and submitted  the rule to OIRA for review.
Executive Order 12988 (Civil Justice Reform): NHTSA stated that the rule  specified its preemptive effect in clear language.
Executive Order 13045 (Protection of Children from Environmental Health  Risks and Safety Risks): NHTSA concluded that because the rule is not  economically significant and does not involve health and safety risks that  disproportionately affect children, no further analysis was necessary  under this executive order.
Executive Order 13132 (Federalism): NHTSA concluded that general  principles of preemption law would operate so as to displace any  conflicting state law or regulation.
section_title: Changes Resulting from OIRA Review
paragraphs: As documented by the agency in memorandums included in the public  docket, OIRA suggested changes to both the proposed and final rule that  NHTSA officials incorporated into the published versions of the rules.  NHTSA incorporated OIRA suggested language to the proposed rule  preamble related to ensuring that crash investigators and researchers are  able to obtain the capability of downloading data from the EDR. Similarly,  NHTSA changed, at OIRA’s suggestion, the owner’s manual statement in  the text of the proposed rule to include a sentence advising owners that an  EDR does not store or collect personal information. NHTSA incorporated  additional OIRA suggestions to the final rule, adding to or clarifying the  policy discussion in the preamble, including adding clarifying language to  the federalism discussion. NHTSA incorporated OIRA changes to the  owner’s manual statement in the final rule text, explaining that parties  with special equipment, including law enforcement officials, can access  information in an EDR if they have access to the vehicle, and that they  may group EDR data with personal information regularly collected in the  course of a criminal investigation.
section_title: Timeline
paragraphs: 1991: NHTSA began to examine EDRs as part of the Special Crash  Investigations Program.
November 9, 1998: NHTSA denied petition for rulemaking on EDRs.    June 2, 1999: NHTSA denied second petition for rulemaking on EDRs.    2001: NHTSA received a third petition for rulemaking on EDRs.
October 11, 2002: NHTSA published request for comment on the future  role of EDRs in motor vehicles.
March 9, 2004: OIRA received the draft proposed rule.    June 3, 2004: OIRA completed review of draft proposed rule consistent  with change.
December 2003: Preliminary regulatory evaluation completed.    June 14, 2004: Proposed rule published in the Federal Register.    April 11, 2006: OIRA received draft final rule.    July 2006: Final regulatory evaluation completed.    August 17, 2006: OIRA completed review of draft final rule consistent with  change.
August 28, 2006: Final rule published in the Federal Register.
section_title: Ethylene Oxide Emissions Standards for Sterilization Facilities (Ethylene Oxide Emissions)
subsections: section_title: Identifying Information
section_title: Rule Synopsis
paragraphs: The rule resulted from the periodic evaluation of the emission standards  for ethylene oxide emissions from sterilization facilities. In the proposed  rule, EPA decided not to impose more stringent emission standards,  determining that additional controls at existing sources would achieve, at  best, minimal emission reduction at a very high cost. The Clean Air Act  requires EPA to assess the risk posed by ethylene oxide emissions and set  more stringent standards as it deems necessary within 8 years of initially  setting standards, taking into account developments in practices,  processes, and control technologies.
section_title: Regulatory Requirements Addressed in the Final Rule
paragraphs: EPA discussed the following generally-applicable statutes and executive  orders in the final rule:    CRA: EPA filed the rule with the Congress and the Comptroller General.    NTTAA: The rule does not involve any technical standards.    PRA: The rule does not impose any new information collection requests.    RFA: EPA determined that the rule would not have a significant economic  impact on a substantial number of small entities.
UMRA: EPA determined that the rule would not result in expenditures of  $100 million or more to state, local, and tribal governments, in the  aggregate, or to the private sector in any one year.
Executive Order 12866 (Regulatory Planning and Review): OMB deemed  the rule a significant regulatory action as defined by the executive order.  Therefore, EPA submitted the rule to OMB for review.
Executive Order 13045 (Protection of Children from Environmental Health  Risks and Safety Risks): EPA “did not have reason to believe” that the  environmental health or safety risks addressed by this rule presented a  disproportionate risk to children.
Executive Order 13132 (Federalism): EPA determined that the final rule  did not have a substantial direct effects on the states, on the national  government and the states, or on the distribution of power and  responsibilities among the various levels of government. EPA concluded  that the rule did not have federalism implications.
Executive Order 13175 (Consultation and Coordination with Indian Tribal  Governments): EPA determined that the rule would not have substantial  direct effects on tribal governments, on the relationship between the  federal government and Indian tribes, or on the distribution of power and  responsibilities between the federal government and Indian tribes.
Executive Order 13211 (Actions Concerning Regulations That Significantly  Affect Energy Supply, Distribution, or Use): EPA determined that the rule  would not likely have a significant adverse effect on the supply,  distribution, or use of energy.
section_title: Changes Resulting from OIRA Review
paragraphs: An OIRA-initiated change included generally available control  technologies or management practices (GACT) in addition to maximum  achievable control technologies or management practices (MACT) for area  sources of ethylene oxide. Both are standards EPA can use for controlling  emissions of ethylene oxide for area sources. Major sources are required  to use MACT to control emissions. In the proposed rule OIRA specified  that the CAA provides that “EPA is not required to conduct any review  under section 112(f) of the CAA or promulgate any emissions limitations  under that subsection for any source listed pursuant to section 112(c)(3),  for which EPA has issued GACT standards. Thus, although EPA has  discretion to conduct a residual risk review under section 112(f) for area  sources for which it has established GACT, it is not required to do so.”  OIRA specified that EPA’s residual risk review is required for each CAA  section 112(d) source category, except area source categories for which  EPA issued a GACT standard.
While addressing Executive Order 13045, “Protection of Children from  Environmental Health and Safety Risks,” EPA stated that “The public is  invited to submit or identify peer reviewed studies and data, of which the  agency may not be aware, that assessed the results of early life exposure  to ethylene oxide commercial sterilization facility emissions.” During  OIRA review this sentence was deleted.
EPA had written that if cancer risks to individuals exposed to emissions  from a regulated source are found above a threshold specified in the CAA,  “we must promulgate residual risk standards for the source category (or  subcategory) which provide an ample margin of safety.” OIRA rewrote the  sentence to read “we must decide whether additional reductions are  necessary to provide an ample margin of safety.” Similarly, EPA wrote that  in the same circumstance, “we must also adopt more stringent standards  to prevent an adverse environmental effect.” The quotation changed  during OIRA review to read “we must determine whether more stringent  standards are necessary to prevent an adverse environmental effect.”
section_title: Timeline
paragraphs: December 6, 1994: Original emission standards rule published.    1997: EPA began developing the methodology for conducting a residual  risk assessment.
Late 1990s: EPA convened groups to consider changing the technologies  used for ethylene emission control.
February 13, 2002: EPA assigned a Start Action Number.    August 3, 2005: OIRA received the draft proposed rule.    September 27, 2005: OIRA completed review of the draft proposed rule.    October 24, 2005: The proposed rule is published in the Federal Register.    March 22, 2006: OIRA met with nonfederal parties regarding the rule.    March 23, 2006: OIRA received the draft final rule.    March 31, 2006: OIRA completed review of the draft final rule.    April 7, 2006: The final rule was published in the Federal Register.
section_title: National Emission Standards for Organic Hazardous Air Pollutants from the Synthetic Organic Chemical Manufacturing Industry (Hazardous Air Pollutants)
subsections: section_title: Identifying Information
section_title: Rule Synopsis
paragraphs: The rule established that the original National Emission Standards for  Organic Hazardous Air Pollutants for the synthetic organic chemical  manufacturing industry set in 1994 would mostly remain unchanged.  Although the rule does not impose further controls on the synthetic  organic chemical manufacturing industry, it does amend certain aspects of  the existing regulations. The CAA directs EPA to evaluate the remaining  risk presented by major sources of emissions of hazardous air pollutants 8  years after promulgation of technology-based standards to determine if the  standards provide an ample margin of safety to protect public health. The  Act also directs EPA to review all standards regulating hazardous air  pollutants every 8 years and revise them as necessary, taking into account  developments in practices, processes, and control technologies.
section_title: Regulatory Requirements Addressed in the Final Rule
paragraphs: EPA discussed the following generally-applicable statutes and executive  orders in the final rule:    CRA: EPA filed the final rule with Congress and the Comptroller General.    NTTAA: The rule does not involve any voluntary consensus standards.    PRA: The rule does not impose any new information collection requests.
RFA: EPA determined that the rule would not have a significant economic  impact on a substantial number of small entities.
UMRA: EPA determined that the rule does not contain a federal mandate  that may result in expenditures of $100 million or more on state, local, and  tribal governments, in the aggregate, or the private sector in any one year.
Executive Order 12866 (Regulatory Planning and Review): OMB deemed  the rule a significant regulatory action as defined by the executive order  because it raised novel legal and policy issues. Therefore, EPA submitted  the rule to OMB for review.
Executive Order 12898 (Federal Actions to Address Environmental Justice  in Minority Populations and Low-Income Populations): One of EPA’s  environmental justice priorities is to reduce exposure to air toxics. In the  proposed rule, EPA requested comment on the implications of this priority  since some regulated facilities are located near minority and low-income  populations. EPA received one comment regarding this environmental  justice concern that it addressed in the final rule.
Executive Order 13045 (Protection of Children from Environmental Health  and Safety Risks): EPA “did not have reason to believe” that the  environmental health or safety risks addressed by the rule presented a  disproportionate risk to children.
Executive Order 13132 (Federalism): EPA determined that the rule did not  have a substantial direct effect on the states, on the relationship between  the national government and the states, or on the balance of power and  responsibilities among the various levels of government. Therefore, EPA  concluded that the rule did not have federalism implications.
Executive Order 13175 (Consultation and Coordination with Indian Tribal  Governments): EPA determined that the rule does not have tribal  implications.
Executive Order 13211 (Actions Concerning Regulations That Significantly  Affect Energy Supply, Distribution, or Use): EPA determined that the rule  would not likely have a significant adverse effect on the supply,  distribution, or use of energy.
section_title: Changes Resulting from OIRA Review
paragraphs: OIRA made several substantive changes to the explanatory text of the  preamble. OIRA cut a section specifying periodic determinations of  pertinent technical factors. It deleted a statement that assumptions made  in the study design did not fully capture the relatively higher exposure  seen by children. It requested additional and more balanced discussion of  the rationale for selecting “no control,” and requested that EPA specify a  sample size and expand its discussion on risks reduced by emission  controls. It deleted a section describing some costs of the regulation and  ways for EPA to avoid those costs. OIRA review resulted in EPA deleting a  sentence asserting that it was required by the CAA under a particular set  of circumstances to promulgate residual risk standards.
section_title: Timeline
paragraphs: February 14, 2002: EPA assigned a Start Action Number.    March 16, 2006: OIRA received draft proposed rule.    March 22, 2006: OIRA met with nonfederal parties regarding the rule.    May 31, 2006: OIRA completed review of proposed rule.    June 14, 2006: Proposed rule published in the Federal Register.    December 11, 2006: OIRA received draft final rule.    December 14, 2006: OIRA completed review of draft final rule.    December 21, 2006: Final rule was published in the Federal Register.
section_title: National Primary Drinking Water Regulations: Stage 2 Disinfectants and Disinfection Byproducts Rule (Disinfection Byproducts 2)
subsections: section_title: Identifying Information
section_title: Rule Synopsis
paragraphs: The rule is intended to help public water systems deliver safe water with  the benefits of disinfection but with fewer risks from disinfection  byproducts. Certain disinfectants used to treat drinking water are known  to create byproducts posing potential reproductive, developmental, and  cancer risks to humans. Authorized by the Safe Drinking Water Act  Amendments of 1996 (SDWA), the rule is one of a series of rules, including  the Surface Water Treatment 2 rule, intended to improve the quality of  drinking water provided by public water systems throughout the United  States. EPA’s first rulemaking on disinfection byproducts was  promulgated in 1979. Because of the complex and far-reaching  implications of the rule, as well as the relationship between the  Disinfection Byproducts 2 rule and the Surface Water Treatment 2 rule,  EPA convened a FACA panel to help develop the policies in the rule.
section_title: Regulatory Requirements Addressed in the Final Rule
paragraphs: EPA discussed the following generally-applicable statutes and executive  orders in the final rule:    NTTAA: EPA adopted voluntary consensus standards for monitoring the  levels of disinfection byproducts.
PRA: The rule contained new information collection requirements for  which EPA completed and submitted an Information Collection Request to  OIRA for approval.
RFA: EPA certified that the rule would not have a significant economic  impact on a substantial number of small entities. EPA conducted a  SBREFA advocacy review panel.
UMRA: EPA determined that the rule may contain a mandate resulting in  annual expenditures of more than $100 million for state, local, and tribal  governments, or the private sector. EPA prepared an UMRA analysis,  which included a consideration of the regulatory alternatives.
Executive Order 12866 (Regulatory Planning and Review): EPA identified  the rule as a significant regulatory action as defined by the executive  order. Therefore, EPA conducted an economic analysis and submitted the  rule to OIRA for review.
Executive Order 12898 (Federal Actions to Address Environmental Justice  in Minority Populations and Low-Income Populations): EPA consulted  with minority and low-income stakeholders. EPA determined that since  the rule applies uniformly to all communities, the health protections  provided are equal across all minority and income groups served by  systems regulated by the rule.
Executive Order 13045 (Protection of Children from Environmental Health  Risks and Safety Risks): EPA concluded that “it has reason to believe that  the environmental health or safety risk . . . addressed by this  may  have a disproportionate effect on children. EPA believes that the   will result in greater risk reduction for children than for the general  population.”
Executive Order 13132 (Federalism): EPA determined that the rule did not  have federalism implications because it will not have substantial direct  effects on the states, on the relationship between the states and federal  government, or the distribution of power and responsibilities among  various levels of government.
Executive Order 13175 (Consultation and Coordination with Indian Tribal  Governments): EPA concluded that the final rule may have tribal  implications because it may impose substantial direct compliance costs on  tribal governments and the federal government will not provide the funds  necessary to pay those costs. A detailed estimate of the tribal impact was  included in the rule.
Executive Order 13211 (Actions Concerning Regulations That Significantly  Affect Energy Supply, Distribution, or Use): EPA determined that the rule  is not likely to have a significant adverse effect on the supply, distribution,  or use of energy.
section_title: Recent Analytic Requirements Addressed
paragraphs: EPA’s regulatory impact analysis addressed the four analytical changes in  the OMB economic guidelines that we reviewed for this study. For  example, the agency analyzed cost-effectiveness, discounted potential  benefits and costs using discount rates of 7 percent and 3 percent,  evaluated potential qualitative and quantitative benefits and costs, and  conducted a probability analysis to assess the uncertainty associated with  some potential impacts. Agency officials said that they assessed the cost- effectiveness of the regulatory alternatives in the rule because the OMB  guidelines require it but that the three other analyses were conducted  because the agency had already adopted them as best practices. The  officials estimated that the cost-effectiveness analysis required from 1 to 2  months to complete, partly because the agency had not yet developed  guidance for analyzing the cost-effectiveness of health-related rules. In  addition, agency officials said that the cost-effectiveness analysis was only  of limited use for selecting a final regulatory alternative.
section_title: Changes Resulting from OIRA Review
paragraphs: The copy of the draft final rule in the docket shows changes throughout to  both the preamble and the rule text itself. Some appear to be strictly  editorial, and others appear to have substantive effect. One significant  change to the rule text itself is in the section on compliance monitoring  requirements. The requirement to repeat monitoring is changed to apply  only when more than eight monitoring locations are required, rather than  four required monitoring locations. Additional requirements for repeat  monitoring have been removed. Changes to the preamble include the  addition of a description of variances and exemptions in place of a  statement that the rule would be updated “upon completion of  affordability discussions with OMB.” EPA’s Executive Order 12866  compliance form for the rule, docketed with the OMB review of the draft  of the final rule, describes the OMB changes as not substantive.
section_title: Timeline
paragraphs: November 29, 1979: The Total Trihalomethanes Rule, the first regulation of  disinfection byproducts, was published.
Fall 1992: EPA convened an advisory committee to address the issue of  disinfection and disinfectant byproducts and pathogen control issues; this  led to the first Disinfection Byproducts rule.
Spring 1993: A Cryptosporidium outbreak in Milwaukee, Wisconsin,  sickened over 400,000 people, roughly 50 percent of users of the municipal  drinking water system.    1996: The SDWA required EPA to establish new standards for treatment of  drinking water and the byproducts of the water treatment process.    1997: EPA convened a federal advisory committee to finalize SDWA  rulemakings, including the Disinfection Byproducts 2 rule and Interim  Enhanced Surface Water Treatment rule.
December 16, 1998: The first Disinfection Byproducts rule was published  in the Federal Register.
March 1999 to July 2000: EPA reconvened the federal advisory committee  to provide technical input on additional SDWA rulemakings, including the  Disinfection Byproducts 2 rule and the Surface Water Treatment 2 rule.
August 6, 1999: EPA assigned a Start Action Number for the rulemaking.    Late 1999: EPA initiated the pre-panel stages of a SBREFA advocacy  review panel.
June 23, 2000: Advocacy review panel completed.    September 2000: Federal advisory committee members signed Agreement  in Principle stating consensus of the group.
December 29, 2000: Federal advisory committee Agreement in Principle  was published in the Federal Register.
January 16, 2001: Revisions to the first Disinfection Byproducts  rulemaking were published in the Federal Register.
October 17, 2001: EPA published pre-proposal draft of Disinfection  Byproducts 2 rule preamble and regulatory language on the agency Web  site for public comment on whether the draft was consistent with federal  advisory committee recommendations.
July 2003: The agency completed the regulatory impact analysis for  proposed rule.
August 18, 2003: The proposed rule was published in the Federal Register.    February 2005: EPA received notice of intent to sue.    April 14, 2005: OMB staff met with outside parties to discuss several rules  by the EPA Office of Water, including this rule.
August 26, 2005: OMB received the draft final rule.    November 2005: EPA entered into settlement agreement to complete the  rule by December 2005.
November 23, 2005: OMB completed review of draft final rule with change.    December 2005: EPA completed the regulatory impact analysis for final  rule.
December 15, 2005: EPA Administrator signed the final rule.    January 4, 2006: The final rule was published in the Federal Register.
section_title: National Primary Drinking Water Regulations: Long Term 2 Enhanced Surface Water Treatment Rule (Surface Water Treatment 2)
subsections: section_title: Identifying Information
section_title: Rule Synopsis
paragraphs: The rule is intended to protect public health against Cryptosporidium and  other microbial pathogens in drinking water. Cryptosporidium is highly  resistant to chemical disinfectants and can cause acute illness and death  for people with weakened immune systems. Authorized by SDWA, the rule  was one of a series of rules, including the Disinfection Byproducts 2 rule,  intended to improve the quality of drinking water supplied by public water  systems throughout the United States. Because of the complex and far- reaching implications of the rule, as well as the relationship between the  Disinfection Byproducts 2 rule and the rule, EPA convened a FACA panel  to help develop the policies in the rule.
section_title: Regulatory Requirements Addressed in the Final Rule
paragraphs: EPA discussed the following generally-applicable statutes and executive  orders in the final rule:    NTTAA: EPA adopted voluntary standards for monitoring the levels of one  pathogen.
PRA: The rule contained new information collection requirements for  which EPA completed and submitted an Information Collection Request to  OIRA for approval.
RFA: EPA certified that the rule would not have a significant economic  impact on a substantial number of small entities. EPA conducted a  SBREFA advocacy review panel.
UMRA: EPA determined that the rule may contain a mandate resulting in  annual expenditures of more than $100 million for state, local, and tribal  governments, in the aggregate, or the private sector. EPA prepared an  UMRA analysis, which included a consideration of the regulatory  alternatives.
Executive Order 12866 (Regulatory Planning and Review): EPA identified  the rule as a significant regulatory action as defined in the executive order  because of its economic significance. Therefore, EPA conducted an  economic analysis and submitted the rule to OIRA for review.
Executive Order 12898 (Federal Actions to Address Environmental Justice  in Minority Populations or Low-Income Populations): EPA determined that  since the rule applies uniformly to all communities, the health protections  provided are equal across all minority and income groups served by  systems regulated by the rule.
Executive Order 13045 (Protection of Children from Environmental Health  Risks and Safety Risks): EPA determined that the rule was economically  significant and that the environmental risks addressed by the rule may  have a disproportionate effect on children.
Executive Order 13132 (Federalism): EPA concluded that the rule may  have federalism implications because it may impose substantial direct  costs on state or local governments, and the federal government will not  provide the funds to pay those costs.
Executive Order 13175 (Consultation and Coordination with Indian Tribal  Governments): EPA concluded that the rule may have tribal implications  because it may impose substantial direct compliance costs on tribal  governments, and the federal government will not provide the funds  necessary to pay those costs.
Executive Order 13211 (Actions Concerning Regulations That Significantly  Affect Energy Supply, Distribution, or Use): EPA determined that the rule  is not likely to have a significant adverse effect on the supply, distribution,  or use of energy.
section_title: Recent Analytical Requirement Addressed
paragraphs: EPA’s regulatory impact analysis addressed the four analytical changes in  the OMB economic guidelines that we reviewed for this study. The agency  analyzed cost-effectiveness, discounted potential benefits and costs using  discount rates of 7 percent and 3 percent, evaluated potential qualitative  and quantitative benefits and costs, and conducted a probability analysis  to assess the uncertainty associated with some potential impacts. Agency  officials said that they assessed the cost-effectiveness of the regulatory  alternatives in the rule because the OMB guidelines require it but that the  three other analyses were conducted because the agency had already  adopted them as best practices. The officials estimated that the cost- effectiveness analysis required from 1 to 2 months to complete, partly  because the agency had not yet developed guidance for analyzing the cost- effectiveness of health-related rules. In addition, agency officials said that  the cost-effectiveness analysis was only of limited use for selecting a final  regulatory alternative.
section_title: Changes Resulting from OIRA Review
paragraphs: According to OMB’s public database, OMB received the draft final rule on  March 31, 2005, and review was complete on June 22, 2005. The rule was  subsequently published “consistent with change.” EPA’s Executive Order  12866 compliance form for the rule, docketed with the OMB review of the  draft of the final rule, describes the OMB changes as not substantive. The  reviewed copy of the draft final rule shows changes throughout the draft  rule to both the preamble and the rule text itself. Some appear to be  strictly editorial, and others appear to have substantive effect. Two  significant changes to the rule text itself are addition of notification of  violation requirements for public water systems in section 141.211 of the  rule and changes to section 141.703 that provide additional circumstances  under which data can be grandfathered under state approval. Changes to  the preamble include indication that regulated systems may assume state  approval of monitoring locations if explicit state approval is not  forthcoming.
section_title: Timeline
paragraphs: Fall 1992: EPA convened an advisory committee to address the issue of  disinfection and disinfectant byproducts and pathogen control issues; this  led to the first Disinfection Byproducts rule.
Spring 1993: A Cryptosporidium outbreak in Milwaukee, Wisconsin,  sickened 400,000 people, roughly 50 percent of users of the municipal  drinking water system.
August 9, 1999: EPA assigned Start Action Number for the rulemaking.    1996: The SDWA authorized EPA to establish new treatment standards for  drinking water and byproducts of the water treatment process.    1997: EPA convened an issue-specific federal advisory committee to  develop SDWA rulemakings, including Stage 1 DBP Rule and Interim  Surface Water Treatment Rule.
December 16, 1998: Interim Enhanced Surface Water Treatment Rule was  published in the Federal Register.
March 1999 to September 2000: EPA reconvened the federal advisory  committee to provide technical input on additional SDWA rulemakings,  including the Long Term 2 Rule.
Late 1999: EPA initiated the pre-panel stages of a SBREFA advocacy  review panel.
June 23, 2000: Advocacy review panel completed.
September 2000: Federal advisory committee members signed Agreement  in Principle stating consensus of the group.
December 29, 2000: Federal advisory committee Agreement in Principle  was published in the Federal Register.
January 16, 2001: Revisions to Interim Enhanced Surface Water Treatment  rulemaking were published in the Federal Register.
October 17, 2001: EPA published pre-proposal draft of Long Term 2 Rule  preamble and regulatory language on the agency Web site for public  comment.
January 14, 2002: The Long Term 1 Rule was published in the Federal  Register.
December 18, 2002: OIRA received the draft proposed rule.    March 18, 2003: OIRA completed review of the draft proposed rule with  change.
June 2003: The agency completed the regulatory impact analysis for  proposed rule.
August 11, 2003: The proposed rule was published in the Federal Register.    February 2005: EPA received notice of intent to sue.    March 31, 2005: OMB received the draft final rule.    April 14, 2005: OMB staff met with outside parties to discuss several rules  by the EPA Office of Water, including this rule.
June 22, 2005: OMB completed review of draft final rule with change.    November 2005: EPA entered into settlement agreement to complete the  rule by December 2005.
December 2005: The agency completed the regulatory impact analysis for  final rule.
December 15, 2005: Final rule was signed.    January 5, 2006: The final rule published in the Federal Register.
section_title: Requirements on Content and Format of Labeling for Human Prescription Drug and Biological Products (Physician Labeling)
subsections: section_title: Identifying Information
section_title: Rule Synopsis
paragraphs: The rule revises the requirements for the format and content of labeling  for human prescription drugs and biological products, the information  physicians use to learn about and prescribe these products. The rule  governs physician drug labeling which takes the form of package inserts.  Package inserts are used as the basis for a large uniform prescription drug  manual called The Physician’s Desk Reference. FDA stated that the intent  of the rule is to enhance the safe and effective use of prescription drug  products and to reduce the number of adverse reactions resulting from  medication errors caused by misunderstood or incorrectly applied drug  information. Specifically, revisions require the labeling of new and  recently approved products to include highlights of prescribing  information and a table of contents, exclude less important and include  more important content, meet new minimum graphical requirements, be  accompanied by all applicable patient labeling approved by FDA, and  clarify certain prescribing requirements.
section_title: Regulatory Requirements Addressed in the Final Rule
paragraphs: FDA discussed the following generally-applicable statutes and executive  orders in the final rule:    NEPA: FDA determined that the rule does not have a significant effect on  the human environment.
PRA: The rule included new information collections for which FDA  completed and submitted an Information Collection Request to OIRA for  approval.
RFA: FDA believes that the final rule would not have a significant impact  on most small entities in this industry, but it is possible that a few small  firms may be significantly affected by the final rule. FDA included a final  regulatory flexibility analysis in the final rule.
UMRA: FDA determined that the rule would not result in any 1-year  expenditure by state, local and tribal governments, in the aggregate, or by  the private sector that would meet or exceed the relevant threshold of  $115 million.
Executive Order 12866 (Regulatory Planning and Review): FDA identified  the rule as a significant regulatory action as defined by the executive  order. FDA conducted an economic analysis and submitted the rule to  OIRA for review.
Executive Order 12988 (Civil Justice Reform): FDA determined that the  rule does not have any retroactive effect.
Executive Order 13132 (Federalism): FDA stated that certain state-level  product liability claims would conflict with federal law or frustrate the  purpose of federal regulation. FDA described six categories of product  liability claims that the agency believed would be preempted by FDA’s  regulation of prescription drug labeling.
section_title: Changes Resulting from OIRA Review
paragraphs: FDA deleted at OIRA’s suggestion an estimate of the number of people  who would submit applications for new drugs and a table detailing the  estimated reporting burden for those subject to FDA’s information  collection request. FDA at OIRA’s suggestion also increased the number of  affected pharmaceutical firms that could be considered small. We found in  FDA’s docket, documentation of OIRA’s review for the final rule but not  for the proposed rule. We assume none was required for the proposed rule  as, according to OIRA’s www.reginfo.gov, it was not changed by OIRA  review.
section_title: Timeline
paragraphs: Before 1992: CDER received feedback from physicians in the field that  prescription drug labeling required revision.    1992: CDER convened the first focus group on the issue.    August 2, 2000: OIRA received draft proposed rule.    December 14, 2000: OIRA completed review of the draft proposed rule  without change.
December 22, 2000: The proposed rule was published in the Federal  Register.
August 2003: The draft final rule approved by CDER.    October 2003: The rule was sent to the Office of Chief Counsel, which  performed a federalism analysis.
November 2004: The rule received FDA approval and was sent to the  Department of Health and Human Services and OMB simultaneously.
January 10, 2005: OIRA received the draft final rule.    April 1, 2005: FDA withdrew the rule from OIRA review at OIRA’s request.    April 8, 2005: FDA resubmitted the rule for OIRA review.    January 17, 2006: OIRA completed its review of the final rule with change.    January 24, 2006: The final rule was published in the Federal Register.
section_title: Use of Ozone Depleting Substances; Removal of Essential Use Designations (Ozone Depleting Substances)
subsections: section_title: Identifying Information
section_title: Rule Synopsis
paragraphs: The Clean Air Act required that FDA, in consultation with EPA, determine  whether an FDA-regulated product that released ozone-depleting  substances was essential. The rule removes the “essential use”  designations granted previously by FDA for seven products emitting  ozone-depleting substances from pressurized containers. As none of the  seven products were being marketed in the United States, the rule  removed unnecessary essential use designations. The products were  granted the designation by a previous FDA rule, which also stated that if  essential use products were no longer marketed in the United States, the  designation could be withdrawn.
section_title: Regulatory Requirements Addressed in the Final Rule
paragraphs: FDA discussed the following generally-applicable statutes and executive  orders in the final rule:    NEPA: FDA conducted an environmental assessment and considered  potential impacts. FDA concluded that an environmental impact statement  was not required.
PRA: The rule does not impose any new information collection requests.    RFA: FDA certified that the rule would not have a significant economic  impact on a substantial number of small entities.
UMRA: FDA did not expect the rule to result in any 1-year expenditure  that would meet or exceed the relevant threshold of $118 million.
Executive Order 12866 (Regulatory Planning and Review): FDA believed  that the rule was not a significant regulatory action as defined by this  executive order. However, OMB requested the rule for review because of  its international implications.
Executive Order 13132 (Federalism): FDA determined that the rule did not  contain policies that have federalism implications.
section_title: Changes Resulting from OIRA Review
paragraphs: Under Executive Order 12866, FDA did not consider the rule significant  regulatory action as defined by the executive order. However, FDA  believed that OMB would want to review the rule because of the rule’s  implications to the Montreal Protocol (Treaty) that included agency  obligations to EPA as stated in the treaty, and also amendments to the  Clean Air Act. OIRA did not suggest any changes to the rule during the  formal OMB review period.
section_title: Timeline
paragraphs: Early 2006: CDER began drafting the direct-to-final rule.    May 2006: CDER approval process began.    July 2006: Economic analysis completed.    August 2006: Rule approved by CDER’s Office of Regulatory Policy.    September 2006: Rule approved by CDER Director.    October 2006: Rule approved by Chief Counsel and management at FDA.    October 23, 2006: OIRA received draft final rule.    November 28, 2006: OIRA completed review of draft final rule with no  change.
December 2006: Direct-to-final rule published in the Federal Register.
section_title: Current Good Manufacturing Practice in Manufacturing, Packaging, Labeling, or Holding Operations for Dietary Supplements (Dietary Supplements)
subsections: section_title: Identifying Information
section_title: Rule Synopsis
paragraphs: The rule establishes the minimum current good manufacturing practice for  manufacturing, packaging, labeling, and holding dietary supplements.  FDA was authorized by the Dietary Supplement Health and Education Act  of 1994 to prescribe by regulation good manufacturing practices for  dietary supplements. FDA published an Advance Notice of Proposed  Rulemaking on February 6, 1997 in the Federal Register. 62 Fed. Reg. 5700.  FDA published a proposed rule in the Federal Register on March 13, 2003.
section_title: Regulatory Requirements Addressed in the Final Rule
paragraphs: FDA discussed the following statutory and regulatory requirements in the  final rule:    NEPA: FDA determined that the final rule did not trigger the requirements  of NEPA because the action is of a type that does not individually or  cumulatively have a significant effect on the human environment.
PRA: The rule included new information collections for which FDA  completed and submitted an Information Collection Request to OIRA for  approval.
RFA: FDA determined that the rule will have a significant economic  impact on a substantial number of small entities and prepared a final  regulatory flexibility analysis.
UMRA: FDA determined that the rule may contain a mandate resulting in  annual expenditures of more than $122 million for state, local, and tribal  governments, or the private sector. FDA prepared an UMRA analysis,  which included a consideration of the rule’s effects on future costs.
Executive Order 12866 (Regulatory Planning and Review): FDA identified  the rule as a significant regulatory action as defined by the executive order  because of its economic significance. Therefore, FDA conducted an  economic analysis and submitted the rule to OIRA for review.
Executive Order 13132 (Federalism): FDA determined that the rule did not  have a substantial direct effect on the states, on the relationship between  the national government and the states, or on the balance of power and  responsibilities among the various levels of government. FDA concluded  that the rule did not have federalism implications.
section_title: Recent Analytic Requirements Addressed
paragraphs: FDA’s regulatory impact analysis for the final rule included the four  analytical changes in OMB Circular No. A-4 that we reviewed for this  study. For example, the agency analyzed cost-effectiveness and evaluated  some qualitative impacts, discounted future benefits and costs using  discount rates of 3 percent and 7 percent, and conducted a probability  analysis to assess the uncertainty associated with some potential impacts.  FDA officials said that they used the two discount rates because of  Circular No. A-4 but added that they have always followed OMB guidelines  on discount rates. The officials could not recall whether the cost- effectiveness analysis was conducted specifically because of Circular No.  A-4, but indicated that it is currently an agency best practice. The officials  added that systematically evaluating qualitative impacts and using  probability analysis to analyze uncertainty are also agency best practices.  For example, the officials said that they analyzed uncertainty using a  probability analysis because it is a best practice when there is a large  degree of uncertainty about the estimated benefits and costs. According to  these officials, OMB Circular No. A-4 is useful because it made transparent  what OMB reviewers expect for analytical support on economically  significant rules and, more generally, because it serves as a blueprint for  conducting a regulatory impact analysis.
section_title: Changes Resulting from OIRA Review
paragraphs: FDA made changes at the suggestion of OIRA to both the preamble and  the regulatory text. FDA sent draft versions of the final rule to OIRA twice,  once in October 2005 and again in June 2006. FDA staff stated that the rule  was not returned by OIRA, but rather as a result of discussions, FDA staff  made a number of changes and sent a second draft of the rule to OIRA.  Our review of both copies of the draft final rule reviewed by OIRA as  docketed by FDA found edits to the rule, both to the preamble and the rule  itself. For example, in addition to editorial changes, changes to the draft  rule text show that a requirement in the rule to save reserve samples for 3  years was changed to 2 years. This change is also reflected in the preamble  language. Changes to the regulatory impact analysis—included with the  rule in its entirety in keeping with FDA practice—show additions of text  justifying the rulemaking and additional descriptions of calculations of  costs associated with illness and injury resulting from contaminated or  mislabeled dietary supplements. We found documentation of the final  stage of OMB review on both drafts sent to OMB during that stage.
section_title: Timeline
paragraphs: October 25, 1994: Dietary Supplement Health and Education Act of 1994,  Pub. L. No. 103-417, was enacted, granting FDA authority to prescribe  good manufacturing practices for dietary supplements by regulation.
November 1995: Industry group requested that FDA consider a rulemaking  on good manufacturing practices for dietary supplements.
February 6, 1997: An Advance Notice of Proposed Rulemaking was  published in the Federal Register.    1998-1999: FDA management considered and committed to a rulemaking.    1999: FDA undertook a series of outreach activities, including public  meetings and tours of dietary supplement manufacturing facilities.
October 4, 2002: OIRA received the draft proposed rule.    January 16, 2003: OIRA completed review of the draft proposed rule with  change.
March 13, 2003: The proposed rule was published in the Federal Register.    October 25, 2005: OIRA received the draft final rule.    November 29, 2005, October 4, 2006, and November 16, 2006: OIRA staff  met with outside parties to discuss this rule.
May 8, 2007: OIRA completed review of draft final rule with change.    June 25, 2007: Final rule was published in the Federal Register, and FDA  published an interim final rule on a process for requesting exemption from  the dietary supplement current good manufacturing practices requirement  for 100 percent identity testing of dietary ingredients.
section_title: Food Labeling: Nutrient Content Claims, Expansion of the Nutrient Content Claim “Lean” (Lean Nutrient Claims)
subsections: section_title: Identifying Information
section_title: Rule Synopsis
paragraphs: The rule amends FDA’s food labeling regulations to allow the use of the  word “lean” more frequently by including it for use with “mixed dishes not  measurable with a cup” that fulfill certain criteria for fat and cholesterol  content. The intent was to provide reliable information that would assist  consumers in maintaining healthy dietary practices. The rule was  promulgated in response to a petition by Nestlé Corporation requesting  that the category “mixed dishes not measurable with a cup” be included  among those that can be called “lean.”
section_title: Regulatory Requirements Addressed in the Final Rule
paragraphs: FDA discussed the following generally-applicable statutes and executive  orders in the final rule:    NEPA: FDA determined that the final rule did not trigger the requirements  of NEPA because the action is of a type that does not individually or  cumulatively have a significant effect on the human environment.
RFA: FDA certified that the rule would not have a significant economic  impact on a substantial number of small entities.
PRA: The rule did not contain any new information collection requests.    UMRA: FDA did not expect the rule to result in any 1-year expenditure by  state, local, and tribal governments, in the aggregate, or by the private  sector, that would meet or exceed the relevant threshold of $122 million.
Executive Order 12866 (Regulatory Planning and Review): FDA  determined that the rule was not a significant regulatory action as defined  by the executive order. However, OMB considered the rule a significant  regulatory action. Therefore, FDA submitted the rule to OIRA for review.
Executive Order 13132 (Federalism): FDA determined that the rule would  have a preemptive effect on state law, but concluded that the preemptive  effect of the rule is consistent with Executive Order 13132.
section_title: Changes Resulting from OIRA Review
paragraphs: After 100 days of formal OMB review, the final rule was not changed by  OMB.
section_title: Timeline
paragraphs: January 9, 2004: Nestlé submitted the petition for the rulemaking.    April 22, 2004: FDA filed the Nestlé petition for comprehensive review.    November 25, 2005: Proposed rule published in the Federal Register.    February 16, 2006: FDA notified state health commissioners, state  agricultural commissioners, food program directors, and FDA field  personnel and drug program directors of the intended amendment.
September 12, 2006: OIRA received draft final rule.    December 21, 2006: OIRA completed review of the draft final rule with no  change.
January 12, 2007: Final rule published in the Federal Register.
section_title: Electronic Shareholder Forums
subsections: section_title: Identifying Information
paragraphs: Agency: Securities and Exchange Commission, Division of Corporation    Rule classification: Not applicable    RIN: 3235-AJ92    Federal Register citation: 73 Fed. Reg. 4450    Regulations.gov docket number: SEC-2007-1058 (proposed rule); SEC- 2008-0133 (final rule)
section_title: Rule Synopsis
paragraphs: The rule encourages the use of online shareholder forums. It removes legal  ambiguity and both real and perceived impediments to private sector  experimentation with the use of the Internet for communication. SEC  stated that such communication technology can potentially better  vindicate shareholders’ rights, for example, to elect directors and improve  discussions on a variety of subjects that are now considered only  periodically and indirectly through the proxy process. The rule gives  liability protection to parties maintaining or operating an electronic  shareholder forum.
section_title: Regulatory Requirements Addressed in the Final Rule
paragraphs: SEC discussed the following generally-applicable statutes in the final rule:    RFA: SEC analyzed whether the rule would have a significant economic  impact on a substantial number of small entities and prepared both an  initial and final regulatory flexibility analysis.
PRA: The rule did not include any new information collection  requirements.
section_title: Changes Resulting from OIRA Review
paragraphs: As an independent regulatory agency, SEC is not subject to OIRA  regulatory review under Executive Order 12866.
section_title: Timeline
paragraphs: 2006: Lawsuit resulted in court decision concerning proxies.    May 7, 24, and 25, 2007: SEC hosted three proxy roundtables to gather  information from a wide of variety of parties interested in proxy issues.
July 12, 2007: Staff formally recommended proposed rule for SEC  consideration.
July 27, 2007: At an open meeting, SEC approved issuance of proposed  rule.
August 3, 2007: Proposed rule was published in the Federal Register.    November 16, 2007: Staff formally recommended adopting final rule to  SEC.
November 28, 2007: At an open meeting, SEC approved issuance of final  rule.
January 25, 2008: Final rule was published in Federal Register.
section_title: Internet Availability of Proxy Materials (Internet Proxies)
subsections: section_title: Identifying Information
paragraphs: Agency: Securities and Exchange Commission, Division of Corporation    Rule classification: Major    RIN: 3235-AJ47    Federal Register citation: 72 Fed. Reg. 4148    Regulations.gov docket number: SEC-2005-0386 (proposed); SEC-2007- 0134 (final)
section_title: Rule Synopsis
paragraphs: The rule provides an alternative method of providing proxy materials to  shareholders by posting the materials on an Internet site and notifying  shareholders of their availability. The rule is voluntary, and issuers of  securities are not required to offer shareholders an electronic distribution  option.
section_title: Regulatory Requirements Addressed in the Final Rule
paragraphs: SEC discussed the following generally-applicable statutory requirements  in the final rule:    PRA: The rule included new information collections for which SEC  completed and submitted an Information Collection Request to OIRA for  approval.
RFA: SEC analyzed whether the rule would have a significant economic  impact on a substantial number of small entities and prepared an initial  and final regulatory flexibility analysis.
section_title: Changes Resulting from OIRA Review
paragraphs: As an independent regulatory agency, SEC is not subject to OIRA  regulatory review under Executive Order 12866.
section_title: Timeline
paragraphs: Spring 2005: SEC regulatory development staff began drafting the  proposed rule.
November 14, 2005: Staff formally recommended that SEC approve  proposed rule.
November 29, 2005: SEC approved issuance of proposed rule at an open  meeting.
December 15, 2005: The proposed rule was published in the Federal  Register.
November 27, 2006: Staff formally recommended adopting final rule for  SEC consideration.
December 13, 2006: SEC approved issuance of final rule at an open  meeting.
January 29, 2007: The final rule was published in the Federal Register.
section_title: Extension of Interactive Data Voluntary Reporting Program on the EDGAR System to Include Mutual Fund Risk/Return Summary Information (Mutual Fund Data Reporting)
subsections: section_title: Identifying Information
paragraphs: Agency: Securities and Exchange Commission, Division of Investment    Rule classification: Not applicable    RIN: 3235-AJ59    Federal Register citation: 72 Fed. Reg. 39,290    Regulations.gov docket number: SEC-2007-0220 (proposed rule); SEC- 2007-0958 (final rule)
section_title: Rule Synopsis
paragraphs: The rule encourages mutual funds to participate in a voluntary reporting  program to tag selected risk/return data in a standard format in eXtensible  Business Reporting Language (XBRL). According to the preamble, “ith  almost half of all U.S. households owning mutual funds. . .improving the  quality of mutual fund disclosure is important to millions of Americans.”  When tagged in XBRL, the data become interactive and can be retrieved,  searched, or analyzed by software applications in an automated fashion.  The rule encourages voluntary participation in a program of electronically  tagging risk/return information by mutual funds, so that SEC can evaluate  the usefulness of such tagging to interested parties. Information submitted  would be included in the Electronic Data Gathering, Analysis, and  Retrieval System (EDGAR) filings.
section_title: Regulatory Requirements Addressed in the Final Rule
paragraphs: SEC discussed the following generally-applicable statutes in the final rule:    PRA The rule included new information collections for which SEC  completed and submitted an Information Collection Request to OIRA for  approval.
RFA: SEC analyzed whether the rule would have a significant economic  impact on a substantial number of small entities and prepared both an  initial and final regulatory flexibility analysis.
section_title: Changes Resulting from OIRA Review
paragraphs: As an independent regulatory agency, SEC is not subject to OIRA  regulatory review under Executive Order 12866.
section_title: Timeline
paragraphs: March 2006: ICI announced an initiative to create a taxonomy of  interactive data tags for the risk/return summary.
June 12, 2006: SEC held a public roundtable on the use of interactive data  for mutual funds.
September 24, 2006: First draft of ICI tags distributed to working group for  comment; SEC staff provided comments on draft taxonomy over next  several weeks.
January 4, 2007: ICI released the XBRL tags to the public.    January 18, 2007: Staff formally recommended proposing release for SEC  consideration.
January 31, 2007: SEC approved issuance of proposed rule.    February 12, 2007: Proposed rule published in the Federal Register.    May 16, 2007: ICI submitted taxonomy to XBRL International for  acknowledgment.
June 6, 2007: Staff formally recommended adopting final rule for SEC.    June 20, 2007: SEC approved issuance of final rule at an open meeting.    July 17, 2007: Final rule was published in the Federal Register.
section_title: Mutual Fund Redemption Fees Identifying Information (Mutual Fund Redemption Fees)
subsections: section_title: Identifying Information
paragraphs: Agency: Securities and Exchange Commission, Division of Investment    Rule classification: Major    RIN: 3235-AJ51    Federal Register citation: 71 Fed. Reg. 58,257    Regulations.gov docket number: SEC-2006-0292 (proposed rule); SEC- 2006-1284 (final rule)
section_title: Rule Synopsis
paragraphs: The rule amends SEC Rule 22c-2, which permits registered open-end  investment companies (funds) to impose a redemption fee of up to 2  percent on the redemption of fund shares. The rule is intended to allow  funds to recoup some of the direct and indirect costs of frequent trading  and to reduce the dilution of fund shares. The rule also requires that the  fund, regardless of whether it imposes a redemption fee, enter into a  written agreement with each of its intermediaries (such as broker-dealers  or retirement plan administrators) under which the intermediaries must  provide the fund, upon request, information about the identity of  shareholders and information about their transactions in fund shares.  These amendments are designed to address certain technical issues that  arose after the rule was adopted and reduce the cost of compliance to  both funds and financial intermediaries.
section_title: Regulatory Requirements Addressed in the Final Rule
paragraphs: SEC discussed the following generally-applicable statutory requirements  in the final rule:    PRA: The rule included new information collections for which SEC  completed and submitted an Information Collection Request to OIRA for  approval.
RFA: SEC analyzed whether the rule would have a significant economic  impact on a substantial number of small entities and prepared both an  initial and final regulatory flexibility analysis.
section_title: Changes Resulting from OIRA Review
paragraphs: As an independent regulatory agency, SEC is not subject to OIRA  regulatory review under Executive Order 12866.
section_title: Timeline
paragraphs: March 11, 2005: SEC adopted rule 22c-2 under the Investment Company  Act; in the final notice, SEC solicited additional comment on 22c-2.
February 3, 2006: Staff formally recommended that SEC amend Rule 22c-2.    February 28, 2006: SEC approved issuance of proposed amendments to  Rule 22c-2.
March 7, 2006: The proposed amended rule was published in the Federal  Register.
September 1, 2006: Staff formally recommended that SEC adopt amended  rule.
September 27, 2006: SEC approved issuance of final rule.    October 3, 2006: The final rule was published in the Federal Register.
This appendix presents examples of different methods that agencies used  to document the OIRA review process under Executive Order 12866 in  their rulemaking dockets (See figs. 5, 6, and 7.)
section_title: Appendix III: Examples of OIRA Review Documentation
section_title: Appendix IV: Comments from the Office of Management and Budget
section_title: Appendix V: Comments from the Securities and Exchange Commission
section_title: Appendix VI: Comments from the Department of Health and Human Services, Food and Drug Administration
section_title: Appendix VII: Comments from the Environmental Protection Agency
section_title: Appendix VIII: GAO Contact and Staff Acknowledgments
subsections: section_title: Acknowledgements
paragraphs: In addition to the contact named above, Timothy Bober, Assistant  Director; Timothy Guinane; Edward Leslie; Andrea Levine; James  McTigue, Susan Offutt, Melanie Pappasian; Jacquelyn Pontious; Robert  Powers; Joseph Santiago; Wesley Sholtes; William Trancucci, Michael  Volpe; Gregory Wilmoth; and Diana Zinkl made key contributions to this  report.
section_title: Related GAO Products
paragraphs: Financial Regulation: A Framework for Crafting and Assessing  Proposals to Modernize the Outdated U.S. Financial Regulatory System.  GAO-09-216. Washington, D.C.: January 8, 2009.
Chemical Assessments: Low Productivity and New Interagency Review  Process Limit the Usefulness and Credibility of EPA’s Integrated Risk  Information System. GAO-08-440. Washington, D.C.: March 7, 2008.
Telecommunications: FCC Should Take Steps to Ensure Equal Access to  Rulemaking Information. GAO-07-1046. Washington, D.C.: September 6,  2007.
Reexamining Regulations: Opportunities Exist to Improve Effectiveness  and Transparency of Retrospective Reviews. GAO-07-791. Washington,  D.C.: July 16, 2007.
Regulatory Flexibility Act: Congress Should Revisit and Clarify  Elements of the Act to Improve Its Effectiveness. GAO-06-998T.  Washington, D.C.: July 20, 2006.
Federal Rulemaking: Perspectives on 10 Years of Congressional Review  Act Implementation. GAO-06-601T. Washington, D.C.: March 30, 2006.
Federal Rulemaking: Past Reviews and Emerging Trends Suggest Issues  That Merit Congressional Attention. GAO-06-228T. Washington, D.C.:  November 1, 2005.
Electronic Rulemaking: Progress Made in Developing Centralized E- Rulemaking System. GAO-05-777. Washington, D.C.: September 9, 2005.
Regulatory Reform: Prior Reviews of Federal Regulatory Process  Initiatives Reveal Opportunities for Improvements. GAO-05-939T.  Washington, D.C.: July 27, 2005.
Economic Performance: Highlights of a Workshop on Economic  Performance Measures. GAO-05-796SP. Washington, D.C.: July 2005.
Paperwork Reduction Act: New Approach May Be Needed to Reduce  Government Burden on Public. GAO-05-424. Washington, D.C.: May 20,  2005.
Unfunded Mandates: Views Vary About Reform Act’s Strengths,  Weaknesses, and Options for Improvement. GAO-05-454. Washington,  D.C.: March 31, 2005.
Unfunded Mandates: Analysis of Reform Act Coverage. GAO-04-637.  Washington, D.C.: May 12, 2004.
Rulemaking: OMB’s Role in Reviews of Agencies’ Draft Rules and the  Transparency of Those Reviews. GAO-03-929. Washington, D.C.:  September 22, 2003.
Federal Rulemaking: Procedural and Analytical Requirements at OSHA  and Other Agencies. GAO-01-852T. Washington, D.C.: June 14, 2001.
Regulatory Flexibility Act: Implementation in EPA Program Offices and  Proposed Lead Rule. GAO/GGD-00-193. Washington, D.C.: September 20,  2000.
Federalism: Previous Initiatives Have Little Effect on Agency  Rulemaking. GAO/T-GGD-99-131. Washington, D.C.: June 30, 1999.
Regulatory Accounting: Analysis of OMB’s Reports on the Costs and  Benefits of Federal Regulation. GAO/GGD-99-59. Washington, D.C.: April  20, 1999.
Federal Rulemaking: Agencies Often Published Final Actions Without  Proposed Rules. GAO/GGD-98-126. Washington, D.C.: August 31, 1998.
Regulatory Management: Implementation of Selected OMB  Responsibilities Under the Paperwork Reduction Act. GAO/GGD-98-120.  Washington, D.C.: July 9, 1998.
Regulatory Reform: Agencies Could Improve Development,  Documentation, and Clarity of Regulatory Economic Analyses.  GAO/RCED-98-142. Washington, D.C.: May 26, 1998.
Regulatory Reform: Implementation of Small Business Advocacy Review  Panel Requirements. GAO/GGD-98-36. Washington, D.C.: March 18, 1998.
Unfunded Mandates: Reform Act Has Had Little Effect on Agencies’  Rulemaking Actions. GAO/GGD-98-30. Washington, D.C.: February 4,  1998.
Regulatory Reform: Changes Made to Agencies’ Rules Are Not Always  Clearly Documented. GAO/GGD-98-31. Washington, D.C.: January 8, 1998.
Managing for Results: Regulatory Agencies Identified Significant  Barriers to Focusing on Results. GAO/GGD-97-83. Washington, D.C.: June  24, 1997.