[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[S. 1728 Introduced in Senate (IS)]







105th CONGRESS
  2d Session
                                S. 1728

  To provide for the conduct of a risk assessment for certain Federal 
                 agency rules, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             March 6, 1998

   Mr. Lott introduced the following bill; which was read twice and 
           referred to the Committee on Governmental Affairs

_______________________________________________________________________

                                 A BILL


 
  To provide for the conduct of a risk assessment for certain Federal 
                 agency rules, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Federal Regulatory Risk Assessment 
Act of 1997''.

SEC. 2. RISK ASSESSMENTS.

    (a) In General.--Chapter 6 of title 5, United States Code, is 
amended by adding at the end the following:

                   ``SUBCHAPTER II--RISK ASSESSMENTS

``Sec. 621. Definitions
    ``For purposes of this subchapter the definitions under section 551 
shall apply and--
            ``(1) the term `cost' means the reasonably identifiable 
        significant adverse effects, including social, health, safety, 
        environmental, economic, and distributional effects that are 
        expected to result directly or indirectly from implementation 
        of, or compliance with, a rule;
            ``(2) the term `Director' means the Director of the Office 
        of Management and Budget, acting through the Administrator of 
        the Office of Information and Regulatory Affairs;
            ``(3) the term `flexible regulatory options' means 
        regulatory options that permit flexibility to regulated persons 
        in achieving the objective of the statute as addressed by the 
        rule making, including regulatory options that use market-based 
        mechanisms, outcome oriented performance-based standards, or 
        other options that promote flexibility;
            ``(4) the term `major rule' means a rule or a group of 
        closely related rules that--
                    ``(A) the agency proposing the rule or the Director 
                reasonably determines is likely to have an annual 
                effect on the economy of $100,000,000 or more in 
                reasonably quantifiable costs; or
                    ``(B) is otherwise designated a major rule by the 
                Director on the ground that the rule is likely to 
                adversely affect, in a material way, the economy, a 
                sector of the economy, including small business, 
                productivity, competition, jobs, the environment, 
                public health or safety, or State, local or tribal 
                governments, or communities;
            ``(5) the term `reasonable alternative' means a reasonable 
        regulatory option that would achieve the objective of the 
        statute as addressed by the rule making and that the agency has 
        authority to adopt under the statute granting rule making 
        authority, including flexible regulatory options;
            ``(6) the term `risk assessment' means the systematic 
        process of organizing hazard and exposure assessments to 
        estimate the potential for specific harm to exposed 
        individuals, populations, or natural resources;
            ``(7) the term `rule' has the same meaning as in section 
        551(4), and shall not include--
                    ``(A) a rule exempt from notice and public comment 
                procedure under section 553;
                    ``(B) a rule that involves the internal revenue 
                laws of the United States, or the assessment and 
                collection of taxes, duties, or other revenue or 
                receipts;
                    ``(C) a rule of particular applicability that 
                approves or prescribes for the future rates, wages, 
                prices, services, corporate or financial structures, 
                reorganizations, mergers, acquisitions, accounting 
                practices, or disclosures bearing on any of the 
                foregoing;
                    ``(D) a rule relating to monetary policy proposed 
                or promulgated by the Board of Governors of the Federal 
                Reserve System or by the Federal Open Market Committee;
                    ``(E) a rule relating to the safety or soundness of 
                federally insured depository institutions or any 
                affiliate of such an institution (as defined in section 
                2(k) of the Bank Holding Company Act of 1956 (12 U.S.C. 
                1841(k)); credit unions; the Federal Home Loan Banks; 
                government-sponsored housing enterprises; a Farm Credit 
                System Institution; foreign banks, and their branches, 
                agencies, commercial lending companies or 
                representative offices that operate in the United 
                States and any affiliate of such foreign banks (as 
                those terms are defined in the International Banking 
                Act of 1978 (12 U.S.C. 3101)); or a rule relating to 
                the payments system or the protection of deposit 
                insurance funds or Farm Credit Insurance Fund;
                    ``(F) a rule or order relating to the financial 
                responsibility, recordkeeping, or reporting of brokers 
                and dealers (including Government securities brokers 
                and dealers) or futures commission merchants, the 
                safeguarding of investor securities and funds or 
                commodity future or options customer securities and 
                funds, the clearance and settlement of securities, 
                futures, or options transactions, or the suspension of 
                trading under the Securities Exchange Act of 1934 (15 
                U.S.C. 78a et seq.) or emergency action taken under the 
                Commodity Exchange Act (7 U.S.C. 1 et seq.), or a rule 
                relating to the protection of the Securities Investor 
                Protection Corporation, that is promulgated under the 
                Securities Investor Protection Act of 1970 (15 U.S.C. 
                78aaa et seq.), or a rule relating to the custody of 
                Government securities by depository institutions under 
section 3121 or 9110 of title 31;
                    ``(G) a rule issued by the Federal Election 
                Commission or a rule issued by the Federal 
                Communications Commission under sections 312(a)(7) and 
                315 of the Communications Act of 1934 (47 U.S.C. 
                312(a)(7) and 315);
                    ``(H) a rule required to be promulgated at least 
                annually pursuant to statute; or
                    ``(I) a rule or agency action relating to the 
                public debt; and
            ``(8) the term `substitution risk' means an increased risk 
        to health, safety, or the environment reasonably likely to 
        result from a regulatory option.
``Sec. 622. Applicability
    ``Except as provided in section 623(d), this subchapter shall apply 
to all proposed and final major rules the primary purpose of which is 
to address health, safety, or environmental risk.
``Sec. 623. Risk assessments
    ``(a)(1) Before publishing a notice of a proposed rule making for 
any rule, each agency shall determine whether the rule is or is not a 
major rule covered by this subchapter.
    ``(2) The Director may designate any rule to be a major rule under 
section 621(4)(B), if the Director--
            ``(A) makes such designation no later than 30 days after 
        the close of the comment period for the rule; and
            ``(B) publishes such determination in the Federal Register 
        together with a succinct statement of the basis for the 
        determination within 30 days after such determination.
    ``(b)(1) When an agency publishes a notice of proposed rule making 
for a major rule to which section 624(a) applies, the agency shall 
prepare and place in the rule making file an initial risk assessment, 
and shall include a summary of such assessment in the notice of 
proposed rule making.
    ``(2)(A) When the Director has published a determination that a 
rule is a major rule to which section 624(a) applies, after the 
publication of the notice of proposed rule making for the rule, the 
agency shall promptly prepare and place in the rule making file an 
initial risk assessment for the rule and shall publish in the Federal 
Register a summary of such assessment.
    ``(B) Following the issuance of an initial risk assessment under 
subparagraph (A), the agency shall give interested persons an 
opportunity to comment under section 553 in the same manner as if the 
initial risk assessment had been issued with the notice of proposed 
rule making.
    ``(c)(1) When the agency publishes a final major rule to which 
section 624(a) applies, the agency shall also prepare and place in the 
rule making file a final risk assessment, and shall prepare a summary 
of the assessment.
    ``(2) Each final risk assessment shall address each of the 
requirements for the initial risk assessment under subsection (b), 
revised to reflect--
            ``(A) any material changes made to the proposed rule by the 
        agency after publication of the notice of proposed rule making;
            ``(B) any material changes made to the risk assessment; and
            ``(C) agency consideration of significant comments received 
        regarding the proposed rule and the risk assessment.
    ``(d)(1) A major rule may be adopted without prior compliance with 
this subchapter if--
            ``(A) the agency for good cause finds that conducting the 
        risk assessment under this subchapter is contrary to the public 
        interest due to an emergency, or an imminent threat to health 
        or safety that is likely to result in significant harm to the 
        public or the environment; and
            ``(B) the agency publishes in the Federal Register, 
        together with such finding, a succinct statement of the basis 
        for the finding.
    ``(2) If a major rule is adopted under paragraph (1), the agency 
shall comply with this subchapter as promptly as possible unless 
compliance would be unreasonable because the rule is, or soon will be, 
no longer in effect.
``Sec. 624. Principles for risk assessments
    ``(a)(1) Subject to paragraph (2), each agency shall design and 
conduct risk assessments in accordance with this subchapter for each 
proposed and final major rule , or that results in a significant 
substitution risk, in a manner that promotes rational and informed risk 
management decisions and informed public input into and understanding 
of the process of making agency decisions.
    ``(2) If a risk assessment under this subchapter is otherwise 
required by this section, but the agency determines that--
            ``(A) a final rule subject to this subchapter is 
        substantially similar to the proposed rule with respect to the 
        risk being addressed;
            ``(B) a risk assessment for the proposed rule has been 
        carried out in a manner consistent with this subchapter; and
            ``(C) a new risk assessment for the final rule is not 
        required in order to respond to comments received during the 
        period for comment on the proposed rule,
the agency may publish such determination along with the final rule in 
lieu of preparing a new risk assessment for the final rule.
    ``(b) Each agency shall consider in each risk assessment reliable 
and reasonably available scientific information and shall describe the 
basis for selecting such scientific information.
    ``(c)(1) Each agency may use reasonable assumptions to the extent 
that relevant and reliable scientific information, including site-
specific or substance-specific information, is not reasonably 
available.
    ``(2) When a risk assessment involves a choice of assumptions, the 
agency shall--
            ``(A) identify the assumption and its scientific or policy 
        basis, including the extent to which the assumption has been 
        validated by, or conflicts with, empirical data;
            ``(B) explain the basis for any choices among assumptions 
        and, where applicable, the basis for combining multiple 
        assumptions; and
            ``(C) describe reasonable alternative assumptions that were 
        considered but not selected by the agency for use in the risk 
        assessment, how such alternative assumptions would have changed 
        the conclusions of the risk assessment, and the rationale for 
        not using such alternatives.
    ``(d) Each agency shall provide appropriate opportunity for public 
comment and participation during the development of a risk assessment.
    ``(e) Each risk assessment supporting a major rule under this 
subchapter shall include, as appropriate, each of the following:
            ``(1) A description of the hazard of concern.
            ``(2) A description of the populations or natural resources 
        that are the subject of the risk assessment.
            ``(3) An explanation of the exposure scenarios used in the 
        risk assessment, including an estimate of the corresponding 
        population at risk and the likelihood of such exposure 
        scenarios.
            ``(4) A description of the nature and severity of the harm 
        that could reasonably occur as a result of exposure to the 
        hazard.
            ``(5) A description of the major uncertainties in each 
        component of the risk assessment and their influence on the 
        results of the assessment.
    ``(f) To the extent scientifically appropriate, each agency shall--
            ``(1) express the overall estimate of risk as a reasonable 
        range or probability distribution that reflects variabilities, 
        uncertainties, and lack of data in the analysis;
            ``(2) provide the range and distribution of risks and the 
        corresponding exposure scenarios, identifying the range and 
        distribution and likelihood of risk to the general population 
        and, as appropriate, to more highly exposed or sensitive 
        subpopulations, including the most plausible estimates of the 
        risks; and
            ``(3) where quantitative estimates are not available, 
        describe the qualitative factors influencing the range, 
        distribution, and likelihood of possible risks.
    ``(g) When scientific information that permits relevant comparisons 
of risk is reasonably available, each agency shall use the information 
to place the nature and magnitude of a risk to health, safety, or the 
environment being analyzed in relationship to other reasonably 
comparable risks familiar to and routinely encountered by the general 
public. Such comparisons should consider relevant distinctions among 
risks, such as the voluntary or involuntary nature of risks.
    ``(h) When scientifically appropriate information on significant 
substitution risks to health, safety, or the environment is reasonably 
available to the agency, the agency shall describe such risks in the 
risk assessment.
``Sec. 625. Deadlines for rule making
    ``(a) All deadlines in statutes or imposed by a court of the United 
States, that require an agency to propose or promulgate any major rule 
to which section 624(a) applies, during the 2-year period beginning on 
the effective date of this section shall be suspended until the earlier 
of--
            ``(1) the date on which the requirements of this subchapter 
        are satisfied; or
            ``(2) the date occurring 6 months after the date of the 
        applicable deadline.
    ``(b) In any case in which the failure to promulgate a major rule 
to which section 624(a) applies by a deadline occurring during the 2-
year period beginning on the effective date of this section would 
create an obligation to regulate through individual adjudications, the 
deadline shall be suspended until the earlier of--
            ``(1) the date on which the requirements of this subchapter 
        are satisfied; or
            ``(2) the date occurring 6 months after the date of the 
        applicable deadline.
``Sec. 626. Judicial review
    ``(a) Compliance or noncompliance by an agency with the provisions 
of this subchapter shall only be subject to judicial review in 
accordance with this section.
    ``(b) Any determination of an agency whether a rule is or is not a 
major rule under section 621(4)(A) shall be set aside by a reviewing 
court only upon a clear and convincing showing that the determination 
is erroneous in light of the information available to the agency at the 
time the agency made the determination.
    ``(c) Any determination by the Director that a rule is a major rule 
under section 621(4), or any failure to make such determination, shall 
not be subject to judicial review in any manner.
    ``(d) Any risk assessment required under this subchapter shall not 
be subject to judicial review separate from review of the final rule to 
which the assessment applies. Any risk assessment shall be part of the 
whole rule making record for purposes of judicial review of the rule 
and shall be considered by a court in determining whether the final 
rule is arbitrary or capricious unless the agency can demonstrate that 
the assessment would not be material to the outcome of the rule.
    ``(e) If an agency fails to perform the risk assessment, a court 
shall remand or invalidate the rule.''.
    (b) Presidential Authority.--Nothing in this Act shall limit the 
exercise by the President of the authority and responsibility that the 
President otherwise possesses under the Constitution and other laws of 
the United States with respect to regulatory policies, procedures, and 
programs of departments, agencies, and offices.
    (c) Technical and Conforming Amendments.--
            (1) Part I of title 5, United States Code, is amended by 
        striking the chapter heading and table of sections for chapter 
        6 and inserting the following:

           ``CHAPTER 6--THE ANALYSIS OF REGULATORY FUNCTIONS

           ``SUBCHAPTER I--ANALYSIS OF REGULATORY FLEXIBILITY

``Sec.
``601. Definitions.
``602. Regulatory agenda.
``603. Initial regulatory flexibility analysis.
``604. Final regulatory flexibility analysis.
``605. Avoidance of duplicative or unnecessary analyses.
``606. Effect on other law.
``607. Preparation of analysis.
``608. Procedure for waiver or delay of completion.
``609. Procedures for gathering comments.
``610. Periodic review of rules.
``611. Judicial review.
``612. Reports and intervention rights.
                   ``SUBCHAPTER II--RISK ASSESSMENTS

``621. Definitions.
``622. Applicability.
``623. Risk assessments.
``624. Principles for risk assessments.
``625. Deadlines for rule making.
``626. Judicial review.''.
            (2) Chapter 6 of title 5, United States Code, is amended by 
        inserting immediately before section 601, the following 
        subchapter heading:

         ``SUBCHAPTER I--ANALYSIS OF REGULATORY FLEXIBILITY''.

SEC. 3. EFFECTIVE DATE.

    Except as otherwise provided in this Act, this Act shall take 
effect 180 days after the date of enactment of this Act, but shall not 
apply to any agency rule for which a notice of proposed rulemaking is 
published on or before August 1, 1997.
                                 <all>