Regulatory budgeting

(a)

Limit for the amount of additional unfunded regulatory costs that may be imposed each fiscal year

(1)

Establishment

(A)

Omb limit

On or before September 30 of each fiscal year, the Director shall establish—(i)a limit on the amount of additional unfunded regulatory costs that may be imposed collectively by the heads of all agencies in the next fiscal year; and(ii)as part of the limit established under clause (i), a limit on the amount of additional unfunded regulatory costs that may be imposed individually by the head of each agency in the next fiscal year.(B)

Proposed agency limits

Not later than 90 days before the date on which the Director establishes a limit for the head of an agency under subparagraph (A)(ii), the head of each agency shall submit to the Director—(i)a proposed limit on the amount of additional unfunded regulatory costs that may be imposed by the head of that agency in the next fiscal year; and(ii)detailed information that describes the bases and reasoning for the proposed limit (including any costs described under subsection (b)(1)(B)(ii)).(C)

Additional matters related to limit

The Director may require as part of a limit under subparagraph (A) that cumulative unfunded regulatory costs be reduced, including for the purpose of offsetting any additional unfunded regulatory costs that may be imposed by the heads of agencies during the fiscal year for which the limit is established.(D)

Congressional approval; implementation of default limit pending required congressional approval

(i)

In general

The Director may not implement a limit established under subparagraph (A) that allows the head of an agency to impose a net increase in additional unfunded regulatory costs during the fiscal year to which the limit applies unless and until Congress approves such limit by joint resolution.(ii)

Limit to be implemented before congressional approval

Following the Director’s submission to Congress under paragraph (2) of a limit described in clause (i), and until Congress approves such limit, the Director shall implement in lieu of such limit a limit that allows no net increase in additional unfunded regulatory costs to be imposed during the applicable fiscal year.(2)

Reports

(A)

Agency-wide limit

Not later than 7 days after establishing a limit under paragraph (1)(A)(i), the Director shall—(i)submit to the appropriate congressional committees a report that identifies the limit established and contains a reasoned statement of the basis and purpose of establishing such limit (including an identification of any cost taken into account in establishing the limit pursuant to subsection (b)(1)(B)(i)); and(ii)publish the report on the website designated under subparagraph (D).(B)

Agency-specific limit

Not later than 7 days after establishing a limit under paragraph (1)(A)(ii) with respect to an agency, the Director shall—(i)submit a report that identifies the limit established and contains a reasoned statement of the basis and purpose of establishing such limit (including an identification of any cost taken into account in establishing the limit pursuant to subsection (b)(1)(B)(i)) to—(I)the appropriate congressional committees; and(II)each standing committee with jurisdiction under the rules of the House of Representatives or the Senate to report a bill to amend the provisions of law under which the head of the agency is authorized to promulgate rules; and(ii)publish the report on the website designated under subparagraph (D).(C)

Prohibition on promulgating certain rules until submission of report to appropriate congressional committees

(i)

In general

The head of an agency may not finalize a rule that imposes an additional unfunded regulatory cost until the Director submits to the appropriate congressional committees the reports required by subparagraph (A)(i) and subparagraph (B)(i) for the fiscal year in which the rule would be finalized.(ii)

Exception

The prohibition under clause (i) shall not apply to any rule with respect to which the President issues an Executive Order stating that the rule should take effect because the rule is—(I)necessary—(aa)because of an emergency, including an imminent threat to health or safety;(bb)for the enforcement of criminal laws; or(cc)for national security; or(II)being issued pursuant to a law implementing an international trade agreement.(D)

Designation of website

Not later than 90 days after the date of the enactment of this subsection, the Director shall designate a website through which the Director will publish reports in accordance with subparagraphs (A) and (B).(b)

Rules resulting in limit being exceeded

(1)

Congressional approval

(A)

Prohibition on rule taking effect

If the promulgation of any individual rule would result in a limit established under subsection (a)(1)(A) being exceeded, notwithstanding any requirement established by the Director pursuant to subsection (a)(1)(C), the rule may not go into effect during the fiscal year in which the rule is promulgated unless and until Congress approves such rule during such fiscal year by joint resolution.(B)

Accounting for certain costs imposed under rules promulgated but not approved

In the case that a rule is prohibited from going into effect during the fiscal year in which the rule is promulgated because Congress does not approve such rule under subparagraph (A), such rule may go into effect during any proceeding fiscal year if—(i)the head of the agency identifies under subsection (a)(1)(B)(ii) the amount of additional unfunded regulatory costs that would be imposed in such fiscal year if such rule takes effect in that fiscal year;(ii)the Director takes into account any such costs in establishing the limits for that fiscal year under subsection (a)(1)(A); and(iii)in the case that such limits allow for the head of an agency to impose a net increase in additional unfunded regulatory costs during the fiscal year to which the limit applies, Congress approves such limits under subsection (a)(1)(D).(2)

Notification

In the case that the head of an agency determines that finalizing a rule may result in the amount of additional unfunded regulatory costs imposed by the head of the agency during that fiscal year to exceed a limit established under subsection (a)(1)(A), notwithstanding any requirement established by the Director pursuant to subsection (a)(1)(C), the head of the agency—(A)shall submit, before promulgating a general notice of a final rule with respect to such rule, a notification to the Director that includes—(i)a justification for exceeding such limit as a result of such rule;(ii)by how much the limit will be exceeded as a result of such rule;(iii)an identification of any requirement established by the Director pursuant to subsection (a)(1)(C) to avoid exceeding such limit as a result of such rule; and(iv)whether the head of the agency identified or considered any alternatives to such rule, or the establishment of additional requirements by the Director pursuant to subsection (a)(1)(C), that would have resulted in the imposition of a lesser amount of additional unfunded regulatory costs, and if so, how much less such amount would have been; and(B)may not promulgate such rule until the head of the agency receives from the Director a notification under paragraph (3)(C) with respect to such rule.(3)

Determination by director

After receiving a notification under paragraph (2), the Director shall—(A)determine whether finalizing such rule during that fiscal year will result in a limit established under subsection (a)(1)(A) being exceeded, notwithstanding any requirement established by the Director pursuant to subsection (a)(1)(C);(B)determine whether the Director agrees with the determination of the head of the agency that such rule should be finalized notwithstanding such limit; and(C)submit a written notification to the head of the agency on the determinations made under subparagraphs (A) and (B) of this paragraph.(4)

Report to congress

In the case that the Director determines under paragraph (3)(B) that the Director agrees with a determination by the head of an agency to finalize a rule that will result, notwithstanding any requirement established by the Director pursuant to subsection (a)(1)(C), in a limit established under subsection (a)(1)(A) being exceeded, not later than 7 days after the Director submits a notification to the head of an agency under paragraph (3)(C) of this subsection with respect to such determination, the Director shall submit to the appropriate congressional committees, each standing committee with jurisdiction under the rules of the House of Representatives or the Senate to report a bill to amend the provision of law under which the rule is to be promulgated, and the Comptroller General, a notification regarding such determination by the Director that includes—(A)the information provided by the head of the agency to the Director under paragraph (2)(A) with respect to such rule; and(B)a reasoned statement of the basis and purpose of such determination.(c)

Statement regarding additional unfunded regulatory costs

In publishing a general notice of a final rule, the head of an agency shall include in such notice a statement that includes—(1)whether the rule will result in the amount of additional unfunded regulatory costs imposed by the agency during the fiscal year in which the rule is finalized to exceed a limit established under subsection (a)(1)(A), notwithstanding any requirement established by the Director pursuant to subsection (a)(1)(C); and(2)in the case that the rule will result in the amount of additional unfunded regulatory costs imposed by the agency during the fiscal year in which the rule is finalized to exceed a limit established under subsection (a)(1)(A), notwithstanding any requirement established by the Director pursuant to subsection (a)(1)(C)—(A)by how much the limit will be exceeded as a result of the rule;(B)a justification for exceeding such limit as a result of the rule;(C)an identification of any requirement established by the Director pursuant to subsection (a)(1)(C) to avoid exceeding such limit as a result of such rule;(D)whether the agency identified or considered any alternatives to the rule, or any requirement established by the Director pursuant to subsection (a)(1)(C) that would have resulted in the imposition of a lesser amount of additional unfunded regulatory costs, and if so, how much less such amount would have been;(E)that the head of the agency submitted a notification to the Director under subsection (b)(2); and(F)the determinations made by the Director under subsection (b)(3) with respect to such rule.(d)

Judicial review

(1)

In general

A person that is aggrieved by agency action regarding a rule that is prohibited under the provisions of this section from being finalized or taking effect is entitled to judicial review of whether the agency complied with this section.(2)

Scope of review

Chapter 7 of title 5, United States Code, shall govern the scope of judicial review under paragraph (1).(3)

Jurisdiction

Each court that has jurisdiction to review a rule for compliance with section 553 of title 5, United States Code, or under any other provision of law, shall have jurisdiction to review a claim brought under paragraph (1).(4)

Relief available

In granting relief in an action under this section, a court shall order the agency that finalized or treated as in effect the rule that is under review to take remedial action consistent with chapter 7 of title 5, United States Code.(e)

Associate administrator for regulatory budgeting

(1)

Establishment of position

Section 3503 of title 44, United States Code, is amended by adding at the end the following new subsection:

(c)

Associate administrator for regulatory budgeting

(1)

Establishment

There is established an Associate Administrator for Regulatory Budgeting within the Office of Information and Regulatory Affairs of the Office of Management and Budget, who is responsible for the oversight and coordination of the implementation of section 2 of the REG Budgeting Act of 2025.(2)

Appointment and pay

The position of Associate Administrator established under paragraph (1) shall be appointed by the President, shall be a position in the excepted service, and shall be compensated at the rate of basic pay for level IV of the Executive Schedule (section 5315 of title 5).

(2)

First appointment of associate administrator for regulatory budgeting

Not later than 30 days after the date of the enactment of this section, the President shall appoint the first Associate Administrator for Regulatory Budgeting established under section 3503(c) of title 44, United States Code, as added by paragraph (1).(3)

Guidelines

Not later than 90 days after the date of the enactment of this section, the Associate Administrator for Regulatory Budgeting shall issue guidelines for agencies to ensure agencies meet the requirements of this section in a consistent manner.(f)

Annual report

On or before October 30 of each fiscal year, the Director shall submit to the appropriate congressional committees a report on the administration by the Director of the limits established under subsection (a)(1)(A) for the prior fiscal year, including—(1)whether the total amount of additional unfunded regulatory costs imposed by all agencies in the prior fiscal year met or exceeded the limit established under clause (i) of such subsection;(2)whether the total amount of additional unfunded regulatory costs imposed by the head of each agency in the prior fiscal year met or exceeded the limit established for such costs under clause (ii) of such subsection;(3)a detailed statement that—(A)identifies by how much, and as a result of finalizing which rule or rules, any such limit was exceeded; and(B)includes a justification for exceeding any such limit as a result of finalizing such rule or rules; and(4)a list of each rule with respect to which the Director determined under subsection (b)(3)(B) that the Director agreed with a determination by the head of an agency to finalize the rule notwithstanding a limit established under subsection (a)(1)(A).(g)

Exemption for monetary policy

This section shall not apply to a rule that concerns monetary policy proposed or implemented by the Board of Governors of the Federal Reserve System or the Federal Open Market Committee.(h)

Definitions

In this section:(1)

Additional unfunded regulatory cost

The term additional unfunded regulatory cost means an unfunded regulatory cost that had not been required to be incurred by any individual or entity as a result of a Federal mandate imposed by rule on an individual or entity during any preceding fiscal year.(2)

Agency

The term agency has the meaning given that term in section 551(1) of title 5, United States Code.(3)

Appropriate congressional committees

The term appropriate congressional committees means—(A)the Committee on Oversight and Government Reform of the House of Representatives; and(B)the Committee on Homeland Security and Governmental Affairs of the Senate.(4)

Cost

The term cost means—(A)a direct cost; or(B)a quantifiable cost that can be estimated using the methods and concepts described in Office of Management and Budget Circular A–4 issued on September 17, 2003.(5)

Cumulative unfunded regulatory costs

The term cumulative unfunded regulatory costs means the aggregate amount of all unfunded regulatory costs imposed during all preceding fiscal years.(6)

Director

The term Director means the Director of the Office of Management and Budget.(7)

Rule

The term rule has the meaning given such term in section 551 of title 5, United States Code.(8)

Unfunded regulatory cost

The term unfunded regulatory cost means a cost required to be incurred by an individual or entity as a result of a Federal mandate imposed by rule on an individual or entity.