Number:  114-2
Date:  January 21, 2015

House Passes H.R. 185,
the Regulatory Accountability Act of 2015
         

On January 13, 2015, the House passed H.R. 185, the Regulatory Accountability Act of 2015, by a vote of 250-175.  The bill would revise and expand Federal rulemaking requirements, with an emphasis on evidence-based determinations in making a rule and increased justification for proposing and finalizing a Federal rule.  The bill now moves to the Senate for consideration.1

Following are provisions of interest to SSA:

• Would amend rulemaking provisions in the Administrative Procedure Act by requiring agencies, in making a rule, to base preliminary and final determinations on evidence.  In addition, agencies would be required to consider:

• The legal authority under which the rule may be proposed and other statutory considerations applicable to whether the agency can or should propose a rule;
• The specific nature and significance of the problem the agency may address with the rule;
• Whether existing rules could be amended or rescinded to address the problem that the proposed rule attempts to address;
• Any reasonable alternatives to the rule; and,
• Potential costs and benefits associated with such alternatives, including estimated impacts on jobs, wages, economic growth, innovation, economic competitiveness, and on low-income populations.

• Would require agencies to publish an Advance Notice of Proposed Rulemaking (ANPRM), no later than 90 days before a Notice of Proposed Rulemaking (NPRM) is published, for major rules, high-impact rules,
  negative-impact on jobs and wages rules, and rules involving novel legal or policy issues.

• “Major” rules would be defined as, among other things, rules having an annual economic cost to the economy of $100 million or more.
• “High-impact” rules would be rules costing the economy in excess of $1 billion per year.
• “Negative-impact on job and wages” rules means any rule that the agency or the Administrator of the Office of Information and Regulatory Affairs (OIRA) determines is likely to reduce employment and average weekly wages by 1 percent or more during a 1, 5, or 10-year period after implementation, or to further reduce employment in industry areas facing significant or projected unemployment.

• The ANPRM would provide not less than 60 days for public comment, and would include:

• An identification of the nature and significance of the problem that the agency may address with the rule;
• The legal authority under which the rule may be proposed;
• Preliminary information concerning other rulemaking considerations;
• Potential reasons to adopt novel legal or policy positions for rules that involve such issues; and,
• An achievable objective for the rule with metrics by which the agency will track progress toward the objective. 

• Would amend the NPRM process by requiring agencies to:

• Consult with the Office of Management and Budget’s (OMB) OIRA before proposing a rule;
• Include within the NPRM, statements such as legal authority for the rule, information and evidence used or provided to the agency, and an achievable objective for the rule;
• Provide interested parties 60 days to comment on a proposed rule (120 days for a major or high-impact rule);
• Provide a 30-day time period for request of administrative hearings on any evidence or information upon which agencies base their proposed rules; and,
• Conduct limited formal hearings before adoption of high-impact rules.

• Would amend the rulemaking process for adopting final rules by requiring that agencies:

• Consult with OIRA before adopting final rule to facilitate compliance with applicable rulemaking requirements;
• Rely on best scientific and economic data;
• Adopt the least-costly alternative considered during rulemaking (unless a more costly rule can be justified);
• Address, in notices of final rules, elements including the reasons for the need for the rule, how the benefits of the rule meet statutory objectives, reasons not to adopt proposed alternative rules, justification of information as basis for the rule, and determination that the rule achieves the objectives established in the ANPRM and NPRM;
• Publish plans for periodic (no less than every 10 years) review of major rules, high-impact rules and negative-impact on jobs and wages, rules  to determine, among other things, if final rules are needed, or should be modified or rescinded; and,
• For negative-impact on jobs and wages rules, provide a statement that the agency head approved the rule knowing its impact on jobs and wages or that OMB qualified the rule as a negative-impact on jobs and wages.

• Would allow agencies to adopt interim rules when they, for good cause, cannot comply with the rulemaking requirements.  Agencies would have up to 270 days from issuance of the interim rule (or 18 months for major or high-impact rules) to complete the rulemaking process and either adopt a final rule or rescind the interim rule.

• Would require agencies to confer with OIRA before issuing major guidance or guidance that involves a novel legal or policy issue arising out of statutory mandates.  Would also require that such guidance be understandable, necessary, and appropriate based upon a cost/benefit analysis.

• Would require OIRA to issue guidelines to agencies promoting coordination and simplification of agency rules.  Would require agencies to ensure that the necessity and reasonableness of proposed rules is clearly established.

• Would require agencies to include in the rulemaking record, and make available electronically and otherwise, all documents and information prepared or considered by the agency.

• Would expand judicial review of agency rulemaking to: 1) allow immediate review of rulemaking not in compliance with notice requirements; 2) establish a substantial evidence standard for affirming rulemaking decisions; and 3) require agencies to make available all documents and information associated with rulemaking.

• Would be effective upon enactment, but would not apply to any rule makings pending or completed on the date of enactment.