Picture Becoming Clearer on New Trump Regulatory Policy

Daily Report for Executives provides in-depth coverage of unfolding legislative, regulatory, and judicial news from the nation’s capital, the states, and around the world. This daily news service...

By Cheryl Bolen

The Office of Management and Budget said it will release the week of July 17 the Spring 2017 Unified Agenda of Federal Regulatory and Deregulatory Actions, which will list for the first time the regulations that agencies intend to eliminate or modify to offset the costs of their new regulations.

The report will provide a long-awaited missing piece of President Donald Trump’s new one-in, two-out regulatory policy, which requires agencies to eliminate two regulations and to offset the costs of each new regulation they want to issue.

“The president has indicated a really fundamental shift in the way that we’re going to think about regulations,” Neomi Rao, the newly confirmed administrator of the OMB’s Office of Information and Regulatory Affairs, told reporters July 13. “And we’re focusing very much on reducing the overall regulatory burden.”

The Department of the Interior, for example, is proposing to reduce its regulatory stockpile by 50 percent and withdraw 152 regulatory actions, said Interior Secretary Ryan Zinke. Among them are rules governing methane gas flaring and the sage grouse, he said.

Reversing Inertia

“We’re essentially asking the government to use muscles it hasn’t used in a really, really long time,” said OMB Director Mick Mulvaney. In the last quarter-century, agencies haven’t been asked to thoroughly deregulate, he said.

Getting the federal government to deregulate now is hard from an inertia standpoint, but the OMB is putting in its full efforts and agencies are starting to come around, Mulvaney said.

So far, Cabinet secretaries have done a good job slowing down the new regulatory burden, but they need to spend more time looking back at existing regulations, Mulvaney said.

As an incentive, Trump signed Executive Order 13,771 on Reducing Regulation and Controlling Regulatory Costs, which requires any significant regulation issued to include two deregulatory actions and be completely offset, resulting in a zero net increase in regulatory costs in fiscal year 2017.

Enforcing Net Zero

Since then, a few agencies have come to the OMB and argued that with rules already in the pipeline, they have to impose costs before they can reduce them, or add a new rule before they can get rid of two old ones, Mulvaney said.

“That’s fine, that works,” Mulvaney said. “We’re going to look at it on a fiscal year,” meaning in practice, agencies won’t have to eliminate two rules before they issue a new rule, he said.

“At the same time, we’re allowing them to bank, so if they have a couple of deregs now, they can go ahead and do those and then they don’t immediately have to find a new one to put out; they can build up an inventory of five or six or 10 dereg actions and then use those to offset the new regulatory actions in the future,” he said.

Another accommodation is to count, in most cases, the elimination of agency guidance as an offset, Mulvaney said.

“So we’re trying to be as accommodating as we can, so that the spirit of the president’s agenda flows through, which is that we will deregulate and we will not add to the regulatory financial burden on the private sector,” Mulvaney said.

Rao’s Role

Rao said her role in this is to ensure the deregulatory effort is effective, responsible, and consistent with the law.

A specific release date for the unified regulatory agenda hasn’t been set, Rao said. Interest in the mandatory report, which is typically released much earlier in the year, has been heightened because of the president’s new regulatory policy.

“This agenda takes a very different direction,” Rao said. It is a “historic shift” from past agendas, which typically list all the regulatory actions that agencies plan to actively take in the next 12 months.

Still, eliminating regulations is a painstaking process that must be done according to the Administrative Procedure Act. “And in some cases, taking [a regulation] out is a longer journey than actually putting it in,” Zinke said.

To contact the reporter on this story: Cheryl Bolen in Washington at cbolen@bna.com

To contact the editor responsible for this story: Paul Hendrie at pHendrie@bna.com

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.

Try Daily Report for Executives