Obama's regulatory reforms draw mixed reviews

Wednesday - 1/19/2011, 6:52am EST

WFED's Jason Miller

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By Jason Miller
Executive Editor
Federal News Radio

President Obama's Executive Order and corresponding memos detailing changes to the federal regulatory process received a mix of reactions from industry experts and on Capitol Hill.

Many experts say the White House is just codifying many things agencies already are doing. Others say the President is capitulating to the pressures of business lobbyists.

But nearly everyone said the fact that Obama is even issuing orders and memos regarding regulatory reform shows the importance of these efforts across the government and society.

"Generally there are two basic mechanisms to achieve public policy goals," said Susan Dudley, former administrator in the Office of Information and Regulatory Affairs in the White House under President Bush. "One is spending programs that are funding through taxes. The other is regulations. They tend to get less attention from the White House - not just this one, but all White Houses. The fact regulations have risen to the president's attention is a positive sign that he's aware of the struggling economy and that there are concerns about excess regulatory activity without regard to the consequences."

President Obama Tuesday signed an Executive Order instructing agencies to get rid of outdated regulations and those that conflict with each other. The President also signed two memos around small business regulatory flexibility, and one on the transparency of industry compliance information.

Agencies by May will have to submit a preliminary plan to the Office of Information and Regulatory Affairs (OIRA) to detail how they will periodically review existing significant regulations to determine whether any such regulations should be modified, streamlined, expanded or repealed so as to make the agency's regulatory program more effective or less burdensome in achieving the regulatory objectives.

Cass Sunstein, the administrator of OIRA, said the goal is to see if the older regulations are costing more and providing fewer benefits than initially imagined.

Collaboration in rulemaking

Sunstein said of the order's six provisions the requirement for agencies to review existing regulations and the one requiring closer collaboration on rulemaking are new.

"The provision that calls for the simplification and harmonization of rules is important because the executive branch large and there are a lot of agencies and sometimes rules issued by one agency may not square with one issued by another," he said. "The President is asking agencies to work together to try to harmonize, coordinate and simplify."

Sunstein said agencies already do this to some extent through OIRA's interagency review process, and through a regulatory working group that meets periodically. But OIRA will place a bigger focus on this ensuring agencies are collaborating on rules.

Sunstein said a recent example is when the Environmental Protection Agency and the Transportation Department worked together on fuel standards.

OIRA will issue guidance to help agencies implement the Executive Order and memos in the coming months. He said there is no specific timeline on when the implementation plan will be released, but it will be sooner than later as agencies have 120 days to develop initial implementation plans for how they will review existing regulations.

"Agencies are in the best position to make choices about which rules to review and justify whether they need to be modified" he said. "The Executive Order makes clear that the look back process will occur with full understanding of the agency's priority settings and resource constraints in a tough budgetary environment. So we expect the agencies will take this process very seriously but do so in way that recognizes resources are not unlimited."

Sunstein said agencies will have to find a way to do the look back based on the resources they have already.

"I don't anticipate any additional budgetary assistance for the look back," he said. "We do anticipate a rule of reason where agencies will be expected to make their own choices about how to balance the cost because in many of the agencies there either is some process of look back and because of all agencies there is considerable expertise about the existing set of programs, we don't think this will require huge resources to be invested."

The administration has been working on the Executive Order and memos for almost a year. It's been part of an ongoing effort to reduce burdens-both paperwork and cost-on businesses. OIRA reported in July that in fiscal 2009 agencies promulgated 66 major rules, of which 16 were estimated to result in a total of $8.6 billion to $28.9 billion in annual benefits and $3.7 billion to $9.5 billion in annual costs.