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By Cheryl Bolen
Not yet halfway into fiscal 2018, federal agencies are already close to meeting the annual regulatory cost savings budgets set for them by the Office of Management and Budget, according to a regulatory analyst.
OMB’s Office of Information and Regulatory Affairs (OIRA) in December publicly released the level of regulatory cost savings each agency is expected to achieve in FY 2018, with an overall goal of $686.6 million in annualized savings for the year.
As of Feb. 16, agencies already had achieved a net savings of $624 million, Dan Bosch, the new director of regulatory policy at the American Action Forum, told Bloomberg Government. AAF maintains a database and closely tracks regulatory activity.
“For FY 2018, the agencies that are under the executive’s purview are well on their way to meeting what is expected of them from OMB,” Bosch said.
Regulatory budgets are a new feature for agencies, first instituted by President Donald Trump in Executive Order 13,771, commonly known as the one-in, two-out order because it also requires agencies to cut two existing rules for every new one they issue.
Under the order, the OMB director during the budget process gives agencies the total amount of incremental costs each will be allowed in issuing new regulations and repealing existing regulations over the next fiscal year.
Cutting the number and cost of regulations has been a top priority of the Trump administration and has often been cited by the president and Cabinet officials as a major contributor to economic growth.
Since regulatory costs and savings are borne by the private sector, savings cannot be used as an offset in the president’s budget. Still, Trump’s FY 2019 budget noted that agencies planned to eliminate 448 regulations and add just 131 new rules this year, for a total savings of $9.8 billion in lifetime regulatory costs.
By comparison, the administration calculated that in FY 2017, agencies achieved $570.4 million in annualized savings, or a total savings of $8.1 billion in present value costs.
Even though agencies are close now to achieving their savings goals for the year, if one big regulation is issued that imposes significant costs, that number drops, Bosch said.
“But given how we’ve seen this administration operate, I would anticipate them going well beyond the $687 million mark,” he said.
Each agency’s regulatory budget is different. This year, the Department of the Interior is expected to save the most at $196 million in annualized savings, but so far, it’s only at $38.6 million, Bosch said.
After Interior, the largest savings are estimated to come from the departments of Labor ($137 million), Energy ($80 million), and Defense ($70.9 million).
Bosch said he does not get “caught up” in the number of regulations cut, but instead focuses on the estimated costs and savings. So far, in calendar year 2018, there have been 30 regulations finalized that have estimated costs, he said.
In terms of regulations that fall under the president’s one-in, two-out executive order, AAF has found 21 deregulatory actions and 5 regulatory actions taken so far in FY 2018.
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