[House Hearing, 108 Congress]
[From the U.S. Government Publishing Office]




 
 REAUTHORIZATION OF THE ADMINISTRATIVE CONFERENCE OF THE UNITED STATES

=======================================================================

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                   COMMERCIAL AND ADMINISTRATIVE LAW

                                 OF THE

                       COMMITTEE ON THE JUDICIARY
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED EIGHTH CONGRESS

                             SECOND SESSION

                               __________

                        MAY 20 AND JUNE 24, 2004

                               __________

                             Serial No. 109

                               __________

         Printed for the use of the Committee on the Judiciary


    Available via the World Wide Web: http://www.house.gov/judiciary

                                  ______

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                       COMMITTEE ON THE JUDICIARY

            F. JAMES SENSENBRENNER, Jr., Wisconsin, Chairman
HENRY J. HYDE, Illinois              JOHN CONYERS, Jr., Michigan
HOWARD COBLE, North Carolina         HOWARD L. BERMAN, California
LAMAR SMITH, Texas                   RICK BOUCHER, Virginia
ELTON GALLEGLY, California           JERROLD NADLER, New York
BOB GOODLATTE, Virginia              ROBERT C. SCOTT, Virginia
STEVE CHABOT, Ohio                   MELVIN L. WATT, North Carolina
WILLIAM L. JENKINS, Tennessee        ZOE LOFGREN, California
CHRIS CANNON, Utah                   SHEILA JACKSON LEE, Texas
SPENCER BACHUS, Alabama              MAXINE WATERS, California
JOHN N. HOSTETTLER, Indiana          MARTIN T. MEEHAN, Massachusetts
MARK GREEN, Wisconsin                WILLIAM D. DELAHUNT, Massachusetts
RIC KELLER, Florida                  ROBERT WEXLER, Florida
MELISSA A. HART, Pennsylvania        TAMMY BALDWIN, Wisconsin
JEFF FLAKE, Arizona                  ANTHONY D. WEINER, New York
MIKE PENCE, Indiana                  ADAM B. SCHIFF, California
J. RANDY FORBES, Virginia            LINDA T. SANCHEZ, California
STEVE KING, Iowa
JOHN R. CARTER, Texas
TOM FEENEY, Florida
MARSHA BLACKBURN, Tennessee

             Philip G. Kiko, Chief of Staff-General Counsel
               Perry H. Apelbaum, Minority Chief Counsel

                                 ------                                

           Subcommittee on Commercial and Administrative Law

                      CHRIS CANNON, Utah Chairman

HOWARD COBLE, North Carolina         MELVIN L. WATT, North Carolina
JEFF FLAKE, Arizona                  JERROLD NADLER, New York
JOHN R. CARTER, Texas                TAMMY BALDWIN, Wisconsin
MARSHA BLACKBURN, Tennessee          WILLIAM D. DELAHUNT, Massachusetts
STEVE CHABOT, Ohio                   ANTHONY D. WEINER, New York
TOM FEENEY, Florida

                  Raymond V. Smietanka, Chief Counsel

                        Susan A. Jensen, Counsel

                        Diane K. Taylor, Counsel

                  James Daley, Full Committee Counsel

                   Stephanie Moore, Minority Counsel



                            C O N T E N T S

                              ----------                              

                             HEARING DATES

                                                                   Page
May 20, 2004
  Reauthorization of the Administrative Conference of the United 
    States.......................................................     1

June 24, 2004
  Why Is There a Need to Reauthorize the Conference?.............    29

                           OPENING STATEMENT
                              May 20, 2004

The Honorable Chris Cannon, a Representative in Congress From the 
  State of Utah, and Chairman, Subcommittee on Commercial and 
  Administrative Law.............................................     1
The Honorable Melvin L. Watt, a Representative in Congress From 
  the State of North Carolina, and Ranking Member, Subcommittee 
  on Commercial and Administrative Law...........................     4
The Honorable Howard Coble, a Representative in Congress From the 
  State of North Carolina, and Chairman, Subcommittee on Crime, 
  Terrorism, and Homeland Security...............................     8
The Honorable John Conyers, Jr., a Representative in Congress 
  From the State of Michigan, and Ranking Member, Committee on 
  the Judiciary..................................................     8

                             June 24, 2004

The Honorable Chris Cannon, a Representative in Congress From the 
  State of Utah, and Chairman, Subcommittee on Commercial and 
  Administrative Law.............................................    29
The Honorable Melvin L. Watt, a Representative in Congress From 
  the State of North Carolina, and Ranking Member, Subcommittee 
  on Commercial and Administrative Law...........................    31
The Honorable Howard Coble, a Representative in Congress From the 
  State of North Carolina, and Chairman, Subcommittee on Crime, 
  Terrorism, and Homeland Security...............................    38
The Honorable Tom Feeney, a Representative in Congress From the 
  State of Florida...............................................    38

                               WITNESSES
                              May 20, 2004

The Honorable Antonin Scalia, Associate Justice, Supreme Court of 
  the United States
  Oral Testimony.................................................    10
  Prepared Statement.............................................    11
The Honorable Stephen G. Breyer, Associate Justice, Supreme Court 
  of the United States
  Oral Testimony.................................................    13
  Prepared Statement.............................................    15

                             June 24, 2004

C. Boyden Gray, Esq., Wilmer Cutler Pickering Hale and Dorr LLP, 
  on behalf of the American Bar Association
  Oral Testimony.................................................    59
  Prepared Statement.............................................    60
Professor Gary J. Edles, Fellow in Administrative Law, American 
  University Washington College of Law, and General Counsel, 
  Administrative Conference of the United States (1987-1995)
  Oral Testimony.................................................    63
  Prepared Statement.............................................    64
Professor Sallyanne Payton, William W. Cook Professor of Law, the 
  University of Michigan Law School, on behalf of the Executive 
  Organization and Management Standing Panel of the National 
  Academy of Public Administration
  Oral Testimony.................................................    71
  Prepared Statement.............................................    72
Professor Philip J. Harter, Earl F. Nelson Professor of Law, 
  Center for the Study of Dispute Resolution, University of 
  Missouri Law School-Columbia School of Law
  Oral Testimony.................................................    75
  Prepared Statement.............................................    77

          LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING
                              May 20, 2004

Prepared Statement of the Honorable Chris Cannon, a 
  Representative in Congress From the State of Utah, and 
  Chairman, Subcommittee on Commercial and Administrative Law....     3
Letter from William Funk, Chair, the American Bar Association 
  Section of Administrative Law and Regulatory Practices.........     5

                             June 24, 2004

Prepared Statement of the Honorable Chris Cannon, a 
  Representative in Congress From the State of Utah, and 
  Chairman, Subcommittee on Commercial and Administrative Law....    30
Letter from Professor Richard Chernick, Esq., Chairman, American 
  Bar Association Section of Dispute Resolution..................    33
Letter from Professor Paul R. Verkuil, Benjamin N. Cardozo School 
  of Law, Yeshiva University.....................................    36
Prepared Statement of Professor Sally Katzen, The University of 
  Michigan Law School............................................    38

                                APPENDIX
               Material Submitted for the Hearing Record
                             June 24, 2004

Response to post-hearing questions from C. Boyden Gray...........    91
Response to post-hearing questions from Professor Gary J. Edles..    97
Response to post-hearing questions from Professor Sallyanne 
  Payton.........................................................   114
Response to post-hearing questions from Professor Philip J. 
  Harter.........................................................   121
Letter from Michael Herz, Professor of Law and Co-Director, and 
  David Rudenstine, Dean and Co-Director, Floersheimer Center of 
  the Benjamin N. Cardozo School of Law, Yeshiva University......   125


 REAUTHORIZATION OF THE ADMINISTRATIVE CONFERENCE OF THE UNITED STATES

                              ----------                              


                         THURSDAY, MAY 20, 2004

                  House of Representatives,
                         Subcommittee on Commercial
                            and Administrative Law,
                                Committee on the Judiciary,
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 2:06 p.m., in 
Room 2141, Rayburn House Office Building, Hon. Chris Cannon 
(Chair of the Subcommittee) presiding.
    Mr. Cannon. The Subcommittee will please come to order. I 
expect we will have several other Members who told us they 
would like to join us will join us soon.
    It is indeed an honor and a pleasure to welcome to our 
Subcommittee today two of our Nation's most esteemed jurists. I 
am informed that it's fairly rare to have a Justice from the 
Supreme Court, let alone two Justices, testify before Congress, 
particularly with respect to matters not pertinent to the 
judiciary's funding or operations. According to the 
Congressional Research Service, the last time a Supreme Court 
Justice testified before the House Judiciary Committee was in 
May 1971, when Associate Justice Potter Stewart discussed 
legislation concerning the Federal Judicial Center and the 
Administrative Office of the United States. The presence of 
Justices Breyer and Scalia, I believe, underscores the 
significance of today's hearing, which focuses on the value of 
reauthorizing the Administrative Conference of the United 
States.
    For those of you who are not familiar with the work and 
accomplishments of the Conference, let me briefly explain.
    Over the course of its 28-year existence, the Conference 
issued more than 200 recommendations, some of which were 
Government-wide and others were agency-specific. It issued a 
series of recommendations eliminating a variety of technical 
impediments to judicial review of agency actions and 
encouraging less costly consensual alternatives to litigation.
    The fruits of these efforts included enactment of the 
Administrative Dispute Resolution Act of 1990, which 
established a framework for the use of ADR. In addition to this 
legislation, ACUS served as the key implementing agency for the 
Negotiated Rulemaking Act, the Equal Access to Justice Act, the 
Congressional Accountability Act, and the Magnusson-Moss 
Warranty Federal Trade Commission Improvement Act.
    The Conference also made recommendations regarding 
implementation of the Congressional Accountability Act and 
played a key role in the Clinton administration's National 
Performance Review with respect to improving the regulatory 
systems. Further, ACUS served as a resource for Members of 
Congress, congressional Committees, the Internal Revenue 
Service, Department of Transportation, and the Federal Trade 
Commission.
    With respect to specific agencies, the Conference, for 
example, during the 1970's undertook an exhaustive study of the 
procedures of a single agency, the Internal Revenue Service, 
which resulted in 72 proposals concerning the confidentiality 
of taxpayer information, IRS settlement procedures, and the 
handling of citizen complaints, among other matters. The IRS 
ultimately adopted 58 of these recommendations.
    Some may ask: Why should we reconsider--or consider 
reauthorizing the agency at this time or the Conference at this 
time? We've gotten along without the Conference over the last 8 
years--I might say, not very well. How can we justify re-
establishing the agency at the attendant expenditures, 
especially in a fiscal belt-tightening environment? The answer, 
at least to me, is obvious. Just this week, Congress passed the 
Paperwork and Regulatory Improvements Act by an overwhelming 
bipartisan vote of 373-54. This legislation is intended to 
assist Congress in its review of final agency rules under the 
Congressional Review Act and to improve the quality and 
quantity of information provided in the annual regulatory 
accounting statement prepared by the Office of Management and 
Budget.
    While a good bill, problems with the current administrative 
law environment are much greater than either the Congress or 
OMB by itself, or even jointly, can address. According to the 
Congressional Research Service, there are growing patterns of 
evasion among agencies with respect to notice and comment 
requirements. An increasing number of regulations are being 
successfully challenged in courts. An informal study by CRS 
indicates that 51 percent of these rules were struck down by 
the courts. Needless litigation hurts everyone. It slows the 
rulemaking process, encourages agencies to try to circumvent 
public comment requirements, and costs taxpayers millions of 
dollars, a lot more than the budget that we're proposing here.
    Another serious area of concern is the need to have a 
coherent approach among the agencies with respect to emerging 
issues and technologies. These areas include issues dealing 
with privacy, national security, public participation in the 
Internet, and the Freedom of Information Act. There are also 
concerns about the need to have peer review and to have 
regulations based on sound science.
    Our Nation's people and business communities depend upon 
Federal agencies to promote scientific research and to develop 
science-based policies that protect the Nation's health and 
welfare. Integral to the Federal regulatory process is the need 
to assess the safety, public health, and environmental impact 
of proposed regulations. Regulations lacking sound scientific 
support can present serious safety and health consequences, as 
well as cause private industry to incur unnecessary and 
burdensome expenses to comply with such regulations. Restoring 
the Conference in some form, from my perspective, would provide 
a cost-effective, highly valuable solution to these problems. 
It is my hope that today's hearing will be the first step 
toward establishing a strong evidentiary base to support the 
reauthorization of the Conference.
    [The prepared statement of Mr. Cannon follows:]
 Prepared Statement of the Honorable Chris Cannon, a Representative in 
    Congress From the State of Utah, and Chairman, Subcommittee on 
                   Commercial and Administrative Law
    The Subcommittee will please come to order.
    It is indeed an honor as well as a pleasure to welcome to our 
Subcommittee two of our nation's most esteemed jurists. I am informed 
that it is a fairly rare event to have a Justice of the Supreme Court--
let alone two Justices--testify before Congress, particularly with 
respect to matters not directly pertinent to the Judiciary's funding or 
operations. According to the Congressional Research Service, the last 
time that a Supreme Court Justice testified before the House Judiciary 
Committee was in May of 1971, when Associate Justice Potter Stewart 
discussed legislation concerning the Federal Judicial Center and the 
Administrative Office of the United States.
    The presence of Justices Breyer and Scalia--I believe--underscores 
the significance of today's hearing, which focuses on the value of 
reauthorizing the Administrative Conference of the United States. For 
those of you who are not familiar with the work and accomplishments of 
the Conference, let me briefly explain.
    Over the course of its 28-year existence, the Conference issued 
more than 200 recommendations--some of which were government-wide and 
others that were agency-specific. It issued a series of recommendations 
eliminating a variety of technical impediments to the judicial review 
of agency action and encouraging less costly consensual alternatives to 
litigation. The fruits of these efforts include the enactment of the 
Administrative Dispute Resolution Act in 1990, which established a 
framework for the use of ADR.
    In addition to this legislation, ACUS served as the key 
implementing agency for the Negotiated Rulemaking Act, the Equal Access 
to Justice Act, the Congressional Accountability Act, and the 
Magnusson-Moss Warranty-Federal Trade Commission Improvement Act. The 
Conference also made recommendations regarding implementation of the 
Congressional Accountability Act and played a key role in the Clinton 
Administration's National Performance Review with respect to improving 
regulatory systems. Further, ACUS served as a resource for Members of 
Congress, Congressional Committees, the Internal Revenue Service, 
Department of Transportation, and the Federal Trade Commission.
    With respect to specific agencies, the Conference, for example, 
during the 1970s undertook an exhaustive study of the procedures of a 
single agency--the Internal Revenue Service--which resulted in 72 
proposals concerning the confidentiality of taxpayer information, IRS 
settlement procedures, and the handling of citizen complaints, among 
other matters. The IRS ultimately adopted 58 of these recommendations.
    Some may ask, ``Why should we consider reauthorizing the Conference 
at this time?'' We've gotten along without the Conference over the last 
eight years. How can we justify re-establishing an agency with the 
attendant expenditures especially in this belt-tightening 
environment?''
    The answer--at least to me--is obvious. Just this week, Congress 
passed the Paperwork and Regulatory Improvements Act by an overwhelming 
bipartisan vote of 373 to 54. This legislation is intended to assist 
Congress in its review of final agency rules under the Congressional 
Review Act and to improve the quality and quantity of information 
provided in the annual regulatory accounting statement prepared by the 
Office of Management and Budget. While a good bill, problems with the 
current administrative law environment are much greater than either the 
Congress or OMB can singularly or even jointly address.
    According to the Congressional Research Service, there are growing 
patterns of evasion among agencies with respect to notice and comment 
requirements. An increasing number of regulations are being 
successfully challenged in the courts. An informal study by CRS 
indicates that 51% of these rules were struck down by the courts. 
Needless litigation hurts everyone--it slows the rulemaking process, 
encourages agencies to try to circumvent public comment requirements, 
and costs taxpayers millions of dollars.
    Another serious area of concern is the need to have a coherent 
approach among the agencies with respect to emerging issues and 
technologies. These areas include issues dealing with privacy, national 
security, public participation and the Internet, and the Freedom of 
Information Act. There are also concerns about the need to have peer 
review and to have regulations based on sound science. Our nation's 
people and business communities depend upon federal agencies to promote 
scientific research and to develop science-based policies that protect 
the nation's health and welfare. Integral to the federal regulatory 
process is the need to assess the safety, public health, and 
environmental impact of proposed regulations. Regulations lacking sound 
scientific support can present serious safety and health consequences 
as well as cause private industry to incur unnecessary and burdensome 
expenses to comply with such regulations.
    Restoring the Conference in some form--from my perspective--would 
provide a cost-effective, yet highly valuable solution to these 
problems. It is my hope that today's hearing will the first step toward 
establishing a strong evidentiary basis of support for reauthorizing 
the Conference.

    Mr. Cannon. I will now turn to my colleague, Mr. Watt, the 
distinguished Ranking Member of the Subcommittee, and ask him 
if he has opening remarks.
    Mr. Watt. Thank you, Mr. Chairman, and I will take a brief 
moment here just to thank the Chairman for convening today's 
hearing and to welcome our distinguished guests, Justices 
Breyer and Scalia.
    As I indicated to the two Justices, this must be my Supreme 
Court day because we--a judicial caucus has now been started in 
the House, and its first visitor just before this meeting was 
convened was Justice Rehnquist, Chief Justice Rehnquist. So I 
think I've had more exposure, direct, personal exposure to 
Justices of the Supreme Court in one day than I have in my 
entire life, although I guess most people know I've had quite a 
bit of exposure, not personal but in other respects, with the 
Justices. So I'm delighted to be here and honored that you 
would share your insights on the topic of this hearing.
    The purpose of the hearing is to determine whether the 
state of administrative law and procedure warrant the 
reauthorization of the Administrative Conference of the United 
States. And as we know, the Administrative Conference was 
initially established in 1964 as a permanent body to serve as 
the Federal Government's in-house adviser on and coordinator of 
administrative procedural reform. It enjoyed bipartisan support 
for over 25 years and advised all three branches of Government 
before being terminated in 1996.
    Through the years, the Conference was a valuable resource 
providing information on the efficiency, adequacy, and fairness 
of the administrative procedures used by administrative 
agencies in carrying out their programs. This was a continuing 
responsibility and a continuing need, a need that, certainly in 
my opinion, has not ceased. So the topic before us today is one 
that has truly been nonpartisan, bipartisan, and I think we are 
blessed to have these two distinguished witnesses who--both of 
whom have personal experience with the Conference and its 
workings. And I understand also that the Chairman is expecting 
to have additional hearings to further information the 
Subcommittee and the Judiciary Committee about the need for the 
Administrative Conference, and I look forward to those 
hearings.
    Again, I welcome Justice Scalia and Justice Breyer, and I 
bring you the regards of your Chief Justice from the prior 
meeting. Thank you for being here.
    I yield back.
    Mr. Cannon. The gentleman's time has expired.
    We would like to thank the Members who have joined us here: 
Mr. Coble from North Carolina; Mr. Chabot from Ohio; Mr. Watt, 
of course, from North Carolina, the Ranking Member; Mr. 
Delahunt from Massachusetts; Mr. Conyers from Michigan; and Mr. 
Scott from Virginia. We appreciate your attendance.
    We received a letter from the American Bar Association 
expressing its support for the reauthorization of the 
Administrative Conference, and without objection, we will 
submit that for inclusion in the record. So ordered.
    [The information referred to follows:]
    
    
    
    
    
    
    Mr. Cannon. Without objection, all Members may place their 
statements in the record at this point. Is there any objection? 
Hearing none, so ordered.
    Mr. Coble has asked for a quick 1-minute opening statement. 
We're pleased to yield to the gentleman.
    Mr. Coble. Mr. Chairman, I will not exceed 1 minute. I just 
want to reiterate what Mr. Watt said. I was with Mr. Watt, Mr. 
Scott, and other colleagues with the Chief Justice at a meeting 
today. We very much enjoyed having him here, and we very much 
appreciate you two Justices being with us.
    And, Mr. Chairman, I regret it but I've got another meeting 
going on now, so I may have to bolt before you conclude. But I 
thank you for having called this hearing.
    Mr. Cannon. I thank the gentleman, and we appreciate that 
many things are going on.
    Mr. Conyers, did you----
    Mr. Conyers. Mr. Chairman, could I be permitted a brief 
welcome to----
    Mr. Cannon. Absolutely, Mr. Conyers. The Ranking Member of 
the full Committee, Mr. John Conyers from Michigan.
    Mr. Conyers.--the two distinguished Justices. I'm so glad 
that you're here. And I just wanted Justice Scalia to know that 
you look much more friendly in our setting than you do in your 
own. [Laughter.]
    Justice Scalia. It's the black robe.
    Mr. Conyers. That might have something to do with it as 
well.
    I have also about several hundred questions which, 
regrettably, are not appropriate to this hearing. But you might 
want to extend to the Ranking senior Member of Judiciary an 
invitation to lunch or something else to examine my viewpoint 
and I yours. And we might reach a greater degree of comity than 
exists at the present moment.
    Thank you very much.
    Mr. Cannon. Thank you, Mr. Conyers.
    Mr. Watt. Could I ask the gentleman to yield just for a 
second?
    Mr. Conyers. Of course.
    Mr. Watt. Just long enough to invite him to become a member 
of the newly established Judiciary Caucus, which had its first 
meeting today and met with Justice Rehnquist. So we're trying 
to encourage comity and exchange across judiciary and----
    Mr. Conyers. Excellent idea.
    Mr. Cannon. Is this a bipartisan caucus?
    Mr. Watt. Yes, it is. It's chaired, actually, by 
Representative Schiff and Representative Biggert, Republican 
and Democrat.
    Mr. Cannon. This is a caucus that goes beyond the Judiciary 
Committee itself?
    Mr. Watt. Yes.
    Mr. Cannon. Okay. Thank you.
    Without objection, the Chair will be authorized to declare 
recesses of the Subcommittee at any point. Hearing none, so 
ordered.
    I ask unanimous consent that Members have 5 legislative 
days to submit written statements for inclusion in today's 
hearing record. So ordered.
    I also want to remind my colleagues of the obvious: Our 
witnesses are guided by Canon 3 of the Code of Conduct for 
United States Judges, which advises the judiciary to avoid 
making public comments with respect to the merits of pending or 
impending actions. We should endeavor to respect those 
constraints and limit our questions to the matter of our 
hearing. Adherence to this admonition will promote a greater 
dialogue, I think, at this point in the hearing and encourage 
the judiciary to participate in future hearings.
    Although I'm now pleased to introduce our witnesses for 
today, I'm sure that our colleagues are very well acquainted 
with their extensive accomplishments.
    Justice Antonin Scalia was nominated by President Ronald 
Reagan to the United States Court of Appeals for the District 
of Columbia Circuit and assumed the bench in 1982. Thereafter, 
he was nominated by President Reagan as Associate Justice of 
the United States Supreme Court and took the oath of office on 
September 26, 1986.
    Prior to his service in the judicial branch, Justice Scalia 
was general counsel for the Office of Telecommunications Policy 
in the Executive Office of the President from 1971 to 1972 and 
Assistant Attorney General in the Office of Legal Counsel at 
the Justice Department from 1974 to 1977. Between those two 
assignments, and of particular relevance to today's hearing, 
Justice Scalia served as chairman of the Administrative 
Conference from 1972 to 1974. In addition, he chaired the 
American Bar Association Section of Administrative Law from 
1982 to 1983.
    Our next witness is Justice Stephen Breyer. Justice Breyer 
began his illustrious legal career as a law clerk to Justice 
Arthur Goldberg during the Supreme Court's 1964 term. He then 
served as special assistant to the head of the Justice 
Department's Antitrust Division from 1965 to 1967. In 1973, 
Justice Breyer, having by this time worked for the judicial and 
executive branches of the Federal Government, now applied his 
talents to the legislative branch, where he worked as assistant 
Watergate special counsel in 1973, special counsel to the 
Senate Judiciary Committee in 1975, and as the Committee's 
chief counsel from 1979 to 1980. Thereafter, he was appointed 
Judge to the United States Court of Appeals for the First 
Circuit. President Clinton nominated him to the Supreme Court, 
and he took office in August 1994. Justice Breyer has authored 
numerous books and articles in the field of administrative law 
and regulation.
    I extend to each of you our warm regards and appreciation 
for your willingness to participate in today's hearing. In 
light of the fact that your written statements will be included 
in the hearing record, I request that you limit your oral 
remarks to 5 minutes, but we are not going to be very hard on 
that time frame. We are mostly interested in your comments and 
ideas. Accordingly, please feel free to summarize and highlight 
the salient points of testimony.
    You'll note that we have a lighting system. It starts with 
green, goes to yellow, it stays yellow for a minute, and then 
we'll sort of ignore it if it turns red.
    On the other hand, because we have a number of Members, 
we'll try and keep the questioning to about 5 minutes using the 
same system, and I'll tend to tap the gavel when the 5 minutes 
runs, just so people are aware. I don't think that we'll have a 
problem with people going over time today.
    Justice Scalia, would you now proceed with your testimony?

 STATEMENT OF THE HONORABLE ANTONIN SCALIA, ASSOCIATE JUSTICE, 
               SUPREME COURT OF THE UNITED STATES

    Justice Scalia. I would be happy to. Mr. Chairman, Members 
of the Subcommittee, Congressman Conyers, I'm happy to be here 
today to provide information about the Administrative 
Conference. I obviously think it was a worthwhile organization 
and I guess demonstrated that belief by devoting 2 years of my 
life to it.
    I've described the organization of the Conference and some 
of its accomplishments, particularly during my tenure as 
Chairman, in my written testimony, and I will not go over that.
    I was Chairman from September 1972 until August 1974. Like 
the first two Chairmen, who were Professor Jerre Williams of 
the University of Texas Law School and Professor Roger Crampton 
of the University of Michigan Law School, and like my 
successor, Professor Robert Anthony of Cornell Law School, I 
was an academic and at that time on leave from the University 
of Virginia Law School. And, frankly, it was very much an 
academic job. I viewed it somewhat as returning from an online 
executive branch job, which I had had before then--I was 
general counsel of an agency--to a job that mainly dealt with 
examining procedures within the executive branch, trying to 
line up consultants (generally academic consultants) who would 
be competent to assist our committees in studying those 
procedures, and then assisting the full Assembly in preparing 
recommendations.
    I found the Conference to be a unique combination of 
talents from the academic world, from within the executive 
branch--because many of the members of the Conference were 
representatives of the agencies, usually general counsels--and, 
thirdly, from the private bar, especially lawyers particularly 
familiar with administrative law. I did not know another 
organization that so effectively combined the best talent from 
each of those areas.
    I think the Conference's ability to be effective hinged in 
part on the fact that we were a Government agency, and when we 
went to do a study at an agency, we were not stonewalled. Very 
often, a member of that agency was on our Assembly, and so the 
agency would cooperate in the study that we did. I think it's 
much harder to do that kind of a study from the outside. The 
agencies tended to look upon us as essentially other people 
from the executive branch trying to make things better.
    I think we were successful in improving many procedures 
throughout the Government. Very little of it made headlines. 
Most of the changes had to be made agency by agency. Nobody who 
was not involved in the particular work of that particular 
subsection of that particular agency would even know that any 
changes had been made. But, all in all, I think the Conference 
was successful in improving the efficiency and the economy of 
the executive branch in many areas.
    Mr. Chairman, at the Court we really don't let counsel 
blather on without being interrupted by questions for very 
long, so I feel constrained to set the example myself. I will 
just refer you to my written testimony for the rest. I'm mainly 
here to answer your questions.
    [The prepared statement of Justice Scalia follows:]
           Prepared Statement of the Honorable Antonin Scalia
    Mr. Chairman and Members of the Subcommittee:
    I am happy to accept your invitation to provide information 
concerning the Administrative Conference of the United States. I was 
the third Chairman of the Conference, and served in that capacity from 
September 1972 to August 1974. Like the first two Chairmen (Professor 
Jerre Williams of the University of Texas Law School, and Professor 
Roger Crampton of the University of Michigan Law School), and like my 
successor (Professor Robert Anthony of Cornell Law School), I was an 
academic--at that time on leave from the University of Virginia Law 
School. The Conference was then, and I believe continued to be, a 
unique combination of scholarship and practical know-how, of private-
sector insights and career-government expertise. My testimony will 
generally pertain to the time period in which I served as Chairman, 
since I did not follow the Conference's activities closely after moving 
on.
    At the outset, let me describe why the Conference was instituted 
and how it was organized. The Administrative Conference of the United 
States was established as a permanent independent federal agency by the 
Administrative Conference Act, signed by President Lyndon Johnson in 
1964; and it was activated by the appointment of its first Chairman in 
January 1968. Its purpose was to identify the causes of inefficiency, 
delay, and unfairness in administrative proceedings affecting public 
rights, and to recommend improvements to the President, the agencies, 
the Congress, and the Courts.
    The Conference was composed of three parts: a Chairman, a Council, 
and an Assembly. The Chairman was appointed by the President, with the 
advice and consent of the Senate, for a term of five years. He was the 
Chief Executive of the Conference. He presided at plenary sessions of 
the Assembly and at Council meetings, and was the official spokesman 
for the Conference in relations with the President, the Congress, the 
Judiciary, the agencies, and the public. His most important 
responsibility, however, was to identify subjects appropriate for study 
by the Conference, and--if the relevant Committee of the Assembly was 
willing to pursue a particular subject--to line up an academic 
consultant qualified to assist in the research. It was also the 
Chairman's responsibility to seek implementation of Conference 
recommendations--a task that required some diplomacy and charm, since 
needless to say the Conference had no enforcement powers over the 
agencies, much less over the President and Congress if the 
recommendations were directed to those quarters. The Chairman was 
served by a small permanent staff whose principal duties were to 
furnish administrative and research support to the Assembly of the 
Conference and its Committees, to follow and assist in the work of 
consultants, and to help the Chairman in securing implementation of 
recommendations.
    The Council of the Conference consisted of the Chairman and 10 
other members who were appointed by the President for three-year terms, 
of whom not more than one-half could be drawn from Federal agencies. 
Its functions were similar to those of a corporate board of directors. 
It had the authority to call plenary sessions of the Conference and to 
fix their agenda, to recommend subjects for study, to receive and 
consider reports and recommendations before the Assembly considered 
them, and to exercise general budgetary and policy supervision.
    The Assembly of the Conference was composed of the entire 
membership, which by statute could not be less than 75 members nor more 
than 91. The Chairman and the other members of the Council accounted 
for 11 of this number; the remaining members fell into the following 
groups: First, the Act conferred membership upon the Chairman of each 
independent regulatory board or commission, or an individual designated 
by the board or commission. Second, the Act granted membership to the 
head of each Executive Department or other administrative agency (or 
his designee) named by the President. The final group consisted of the 
public members, appointed by the Chairman with the approval of the 
Council for two-year terms. These members, who had to comprise not less 
than one-third nor more than two-fifths of the total membership, were 
selected in such a manner as to provide broad representation of the 
views of private citizens of diverse experience. They were chosen from 
among members of the practicing bar, prominent scholars in the field of 
administrative law, and others specially qualified by knowledge and 
experience to deal with matters of federal administrative procedure.
    The Assembly, which had ultimate authority over all activities of 
the Conference, operated much like a legislative body. It adopted By-
laws establishing nine standing committees: (1) Agency Organization and 
Personnel, (2) Claims Adjudications, (3) Compliance and Enforcement 
Proceedings, (4) Grant and Benefit Programs, (5) Informal Action, (6) 
Judicial Review, (7) Licenses and Authorizations, (8) Ratemaking and 
Economic Regulation, and (9) Rulemaking and Public Information. These 
committees were the real work-horses of the Conference. They met 
periodically to direct and supervise research by academic consultants 
and by the Conference's professional staff. On the basis of that 
research they framed proposals for consideration by the Assembly at its 
annual meeting. When a study or tentative recommendation had been 
prepared, it was circulated to the affected agencies for comment and 
reexamined by the committee in light of the replies. After final 
committee approval, a proposed recommendation would be transmitted to 
the Council and then to the Assembly for final action in plenary 
session. The Assembly could adopt the recommendation in the form 
proposed, amend it, refer it back to the committee, or reject it 
entirely.
    The purpose of the Conference was to apply the talents of its 
diverse group of agency officials, practitioners, and academic members 
to improving the efficiency and fairness of the thousands of varieties 
of federal agency procedures. In my judgment, it was an effective 
mechanism for achieving that goal--usually through voluntary acceptance 
of its recommendations by the affected agencies. Inefficiency and 
unfairness in agency procedures often exist simply by reason of 
bureaucratic inertia, and a well reasoned study and recommendation, 
prepared with the cooperation of the affected agency, can often produce 
desirable change. A few of the Conference's projects have had major, 
government-wide impact--for example, its recommendation leading to 
Congress's adoption of Public Law 94-574, which abolished the doctrine 
of sovereign immunity in suits seeking judicial review of agency 
action. For the most part, however, each of the Conference's projects 
was narrowly focused upon a particular agency problem, and was unlikely 
to attract attention beyond the affected community. This should be 
regarded, not as a sign of ineffectiveness, but as evidence of solid 
hard work. Administrative procedure is not a one-size-fits-all 
operation; most procedural regimes are unique, and have to be fixed 
one-by-one.
    The Administrative Conference made several important strides in the 
area of implementation and saw some of its earlier recommendations bear 
fruit. Some examples that come to mind are the Justice Department's 
almost verbatim adoption of the Conference's guidelines for 
implementation of the Freedom of Information Act; the Civil Service 
Commission's publication of proposals substantially applying the 
Conference's recommendation concerning adverse actions against Federal 
employees; the Board of Parole's indication of its readiness to adopt 
the Conference proposals concerning parole procedures; and the 
Department of Labor's adoption of a field memorandum that substantially 
implemented the Conference's proposals regarding labor certification of 
immigrant aliens. Agencies that engaged in publicity as a regulatory 
tool adopted procedures conforming to the Conference's recommendations 
for protecting against unfair publicity that could harm a private 
party. The Conference's recommendations regarding procedures for 
resolution of environmental issues in licensing proceedings were 
embodied in regulations adopted by five of the six affected agencies.
    Some of the Conference's work also bore fruit at the legislative 
level. The Parole Commission and Reorganization Act of 1976, P.L. 94-
233, implemented Recommendation 72-3's call for a right to counsel in 
parole proceedings, and other procedural guarantees recommended by the 
Conference. The 1974 Freedom of Information Act Amendments, Pub. L. No. 
93-502, adopted many of the Conference's recommended improvements to 
FOIA. The Conference's encouragement of granting agencies authority to 
impose civil money penalties has had a major, and I think beneficial, 
impact. Many separate statutes implemented the Conference's 
recommendation regarding the appropriate standard of pre-enforcement 
judicial review of rules of general applicability. (That recommendation 
was also cited by court opinions that looked to it for guidance. See 
Ass'n of Data Processing Service Organizations, Inc. v. Board of 
Governors of Federal Reserve System, 745 F. 2d 677, 684 (CADC 1984); 
Home Box Office, Inc. v. F. C. C., 567 F. 2d 9, 57 n.130 (CADC 1977).) 
Some recommendations were effectively implemented through a combination 
of congressional and agency action. For example, the Department of 
Treasury agreed to carry out most of the provisions of Recommendation 
73-4, which called for increased access to customs representatives, 
greater disclosure, and written findings; and 1974 legislation 
implemented the suggested improvements in coordination between Customs 
and other relevant agencies. Of course some recommendations were framed 
not in terms of what to do, but rather in terms of what to avoid--for 
example, the recommendation cautioning against Congress's imposition of 
complex rulemaking procedures, which has been followed with few 
exceptions.
    The Conference made itself useful in ways beyond specific proposals 
for legislation, or executive or judicial action. As Chairman, I gave 
testimony before Congress on legislation pertaining to the Freedom of 
Information Act, the procedures of the U. S. Board of Parole, the 
establishment of a Consumer Protection Agency, possible amendments to 
the Federal Food, Drug, and Cosmetics Act and the Fair Packaging and 
Labeling Act, and the opening of the administrative process to the 
public. The Conference responded to numerous informal requests for 
advice from congressional committees and committee staffs on a wide 
variety of procedural matters.
    Agencies also sought the Conference's informal advice and 
assistance, particularly in connection with their initiation of new 
programs or procedures. I regarded this sort of pre-implementation 
advice as a particularly beneficial activity, since it is obviously 
preferable to get things started on the right foot than to criticize 
the deficiencies of a program already in operation. During my first 
year alone, the staff and consultant resources of the Conference were 
called upon for advice with respect to several programs under 
development--for example, the Department of Transportation's program to 
facilitate public participation in their rulemaking process, and the 
Justice Department's congressionally mandated study into the 
feasibility of a special court for environmental matters. Especially 
noteworthy was the study which the Chairman's Office prepared, at the 
request of the Office of Management and Budget, covering the procedural 
provisions of what was then the most significant piece of regulatory 
legislation that had been adopted in years, the Consumer Product Safety 
Act. This study was completed before the members of the new Consumer 
Product Safety Commission had yet been named, and was therefore a prime 
example of applying the Conference's expertise at the point where it is 
most useful--before procedures have been adopted and institutional 
commitments made. The Conference also conducted seminars for agency 
attorneys, emphasizing those aspects of administrative procedure that 
had special relevance to the attorneys' agency, but also refreshing the 
attorneys' recollection of basic administrative law principles to which 
they had had no systematic exposure since law school.
    The Conference also conducted studies that, while not producing 
recommendations in and of themselves, were useful in enabling 
particular administrative functions to be understood and evaluated. An 
example of this is the study completed during the first year of my 
chairmanship by the Committee on Informal Action, systematically 
examining, for the first time, the agencies' practices in providing 
advice to the public. Or the study by the Chairman's Office concerning 
the various means by which agencies handle citizen complaints.
    One way of judging the worth of the Conference without becoming 
expert in the complex and unexciting details of administrative 
procedures with which it deals, is to examine the roster of men and 
women who have thought it worthwhile to devote their time and talent to 
the enterprise. Over the years, the academics who have served as 
consultants to or members of the Conference have been a virtual Who's 
Who of leading scholars in the field of administrative law; and the 
practitioners who have served as members have been, by and large, 
prominent and widely respected lawyers in the various areas of 
administrative practice.
    I would not presume to provide the Subcommittee advice on the 
ultimate question of whether, in a time of budget constraints, the 
benefits provided by the Administrative Conference are within our 
Nation's means. But I can say that in my view those benefits are 
substantial. The Conference was a proved and effective means of opening 
up the process of government to needed improvement.

    Mr. Cannon. Thank you, Mr. Justice. That was very 
enlightening, raised points I hadn't considered in the past. We 
have strict rules here because there's a tendency that we 
blather on, and so we will adhere at least on our behalf. Thank 
you very much.
    Mr. Justice Breyer, would you mind presenting your 
testimony now?

    STATEMENT OF THE HONORABLE STEPHEN G. BREYER, ASSOCIATE 
          JUSTICE, SUPREME COURT OF THE UNITED STATES

    Justice Breyer. In the Court, when the red light goes on, 
people stop. [Laughter.]
    Mr. Cannon. We'd like to inject some of that DNA around 
here, but we've long since given up.
    Justice Breyer. Mr. Chairman and Members of the Committee, 
I'm very pleased to be here with my colleague Justice Scalia. I 
think we're completely in agreement. I think it's a very good 
thing that you're looking into the question of reauthorization. 
The reason I think it is good is I think Americans have 
problems that call for some Government solutions. They might 
need Social Security. They might need a permit in the 
environmental area. They might need--they might be veterans. 
There are just millions and millions of interactions between 
ordinary citizens and Government.
    If you tell the citizens that they just have only to do 
what the Government says or go to court, their life becomes 
impossible because courts are too expensive and they take too 
long. So we have administrative processes which are supposed to 
be simple and they're supposed to be less expensive. That's 
where the Administrative Conference comes in, because it's hard 
to create those processes--very hard. And it's done at a level 
that's highly technical. You could say, ``What person actually 
cares about separation of functions rules for rulemaking?'' All 
you have to do is mention that phrase, and they're already 
asleep. But, in fact, whether you have one set of rules or 
another set of rules matters. And if you were to say, ``What's 
the right set of rules?'' I couldn't tell you in theory. In 
theory, there is no right set. You have to have people who know 
about it. And I have been an academic for many years, and I 
will absolutely swear that they don't know.
    We are very good in the academy at getting theories, but 
we're not necessarily so good in finding out how they operate 
in practice. This is where the Administrative Conference came 
in.
    My first book I ever wrote, a book that I think was 
extremely popular--I think it sold 23 copies. But it was aimed 
at certain questions: How do people actually set rates at the 
Federal Power Commission? Do you remember the Federal Power 
Commission? Well, that was back in the 1960's, and that was 
FERC before FERC was born.
    So Paul McAvoy and I actually went to the Federal Power 
Commission. It was impossible in Washington to find anyone who 
knew where it was. We found it. We found the administrators who 
actually set the rates. It was a woman named Georgia Ledaukis. 
I remember her. I said, ``How do you set a rate?'' And she 
explained it. No one had ever asked her that question. But it 
was that system that only she, I think, at the Federal Power 
Commission knew about. and that was really the system that 
they, in fact, used.
    So, I think that was a good idea. And what the 
Administrative Conference did was formalize that kind of thing. 
There were four kinds of members: there were actual 
commissioners. I can remember when--it was Dean Burch--do you 
remember Dean Burch who was Chairman of the Federal 
Communications Commission? And he would tell us about the 
problem of ex parte communications in practice. Would you like 
to know what he said? It's sort of interesting. He said--I can 
remember this talk. He said, ``You know, I was from Arizona. I 
was appointed Chairman of the Federal Communications 
Commission. My neighbors congratulated me. And then I came to 
Washington. I thought I was a pretty important person. But I 
discovered nobody was the slightest bit interested. Oh, no,'' 
he said, ``there was one group of people, one group of very 
polite, very charming, really hospitable people who seemed to 
be interested in everything I said. They were lawyers, and they 
worked for the communications company.'' He said, ``No, that 
was in really practical form the problem of ex parte 
communications.''
    Well, I'm just giving you examples. But I'm saying when you 
put the academics together with the agency staffs, the agency 
commissioners, the heads of the agency, and then some lawyers 
who are actually practical people outside the agency who know 
what it is to deal with them every day. And they discuss things 
at a technical level, sometimes things can change--a little bit 
for the better.
    What kinds of rules should we have for a proceeding of 
informal rulemaking? How formal should informal rulemaking be? 
Should it be very formal, like formal rulemaking? Hardly 
formal? Somewhere in the middle? The same for every agency? 
Have exceptions, as we do sometimes for some of these 
procedures?
    The Conference would try to address that kind of question. 
Someone would write a report. The report would be criticized. 
It would be discussed. Something would emerge, and then 
recommendations would flow, either to the agencies themselves 
or to Congress. When they passed Congress--and sometimes they 
did--it was not because people thought there was a lot of 
political force behind it one way or the other. It was because 
they thought it was simply good Government. That's what the 
commission--that's what the Conference did. It is a matter of 
good Government. Its recommendations were not perfect, but I 
think they helped. And it's a great forum for bringing people 
together and discussing what will really happen, not what the 
politics or the general policy is about procedure and at a 
technical level.
    So I'm very glad you've looked into this. I'm glad you're 
doing it. I very much hope you reauthorize the Administrative 
Conference.
    [The prepared statement of Justice Breyer follows:]
           Prepared Statement of the Honorable Stephen Breyer
    Mr. Chairman and Members of the Subcommittee. Thank you for the 
invitation to comment upon the Administrative Conference of the United 
States. I participated in its activities from 1981 to 1994 as a 
``liaison'' to the Administrative Conference from the Judicial 
Conference. I believe that the Conference was a unique organization, 
carrying out work that is important and beneficial to the average 
American, at low cost.
    During that time, the Administrative Conference primarily examined 
government agency procedures and practices, searching for ways to help 
agencies function more fairly and more efficiently. It normally focused 
upon achieving ``semi-technical'' reform, that is to say, changes in 
practices that are general (involving more than a handful of cases and, 
often, more than one agency) but which are not so controversial or 
politically significant as likely to provoke a general debate, say, in 
Congress. Thus, it would study, and adopt recommendations concerning 
better rule-making procedures, or ways to avoid legal technicalities, 
controversies, and delays through agency use of negotiation, or ways of 
making judicial review of agency action less technical and easier for 
ordinary citizens to obtain. While these subjects themselves, and the 
recommendations about them, often sound technical, in practice they can 
make it easier for citizens to understand what government agencies are 
doing to prevent arbitrary government actions that could cause harm.
    The Administrative Conference was unique in that it developed its 
recommendations by bringing together at least four important groups of 
people: top-level agency administrators; professional agency staff; 
private (including ``public interest'') practitioners; and 
academicians. The Conference would typically commission a study by an 
academician say, a law professor, who often has the time to conduct the 
study thoughtfully, but may lack first-hand practical experience. The 
professor would spend time with agency staff, which often has otherwise 
unavailable facts and experience, but may lack the time for general 
reflections and comparisons with other agencies. The professor's draft 
would be reviewed and discussed by private practitioners, who bring to 
it a critically important practical perspective, and by top-level 
administrators such as agency heads, who can make inter-agency 
comparisons and may add special public perspectives. The upshot was 
likely to be a work-product that draws upon many different points of 
view, that is practically helpful and that commands general acceptance.
    In seeking to answer the question, ``Who will control the 
regulators?'' most governments have found it necessary to develop 
institutions that continuously review, and recommend changes in, 
technical agency practices. In some countries, ombudsmen, in dealing 
with citizen complaints, will also recommend changes in practices and 
procedures. Sometimes, as in France and Canada, expert tribunals will 
review decisions of other agencies and help them improve their 
procedures. Sometimes, as in Australia and the United Kingdom, special 
councils will advise ministries about needed procedural reforms. Our 
own Nation developed this rather special approach (drawing together 
scholars, practitioners, and agency officials) to bringing about reform 
of a sort that is more general than the investigation of individual 
complaints yet less dramatic than that normally needed to invoke 
Congressional processes. Given the Conference's rather low cost (a 
small central staff, commissioning academic papers, endless amounts of 
volunteered private time, and two general meetings a year), it is 
indeed a pity that by abolishing this Conference, we have weakened our 
federal government's ability to respond effectively, in this general 
way, to the problems of its citizens.
    I have not found other institutions readily available to perform 
this same task. Individual agencies, while trying to reform themselves, 
sometimes lack the ability to make cross-agency comparisons. The 
American Bar Association's Administrative Law Section, while a fine 
institution, cannot call upon the time and resources of agency staff 
members and agency heads as readily as could the Administrative 
Conference. Congressional staffs cannot as easily conduct the technical 
research necessary to develop many of the Conference's more technical 
proposals. The Office of Management and Budget does not normally 
concern itself with general procedural proposals.
    All of this is to explain why I believe the Administrative 
Conference performed a necessary function, which, in light of the cost, 
should have been maintained. I recognize that the Conference was not 
the most well known of government agencies; indeed, it was widely known 
only within a fairly small (administrative practice oriented) 
community. But, that, in my view, simply reflects the fact that it did 
its job, developing consensus about change in fairly technical areas. 
That is a job that the public, whether or not it knows the name 
``Administrative Conference,'' needs to have done. And, for the reasons 
I have given, I believe that the Administrative Conference was well 
suited to do it.
    I hope these views will help you in your evaluation of the need to 
re-establish the Conference. I highly recommend that Congress do so.

    Mr. Cannon. Thank you very much, Mr. Justice Breyer.
    Mr. Coble, would you like 5 minutes?
    Mr. Coble. Thank you, Mr. Chairman. And, again, I apologize 
for my imminent departure, but it's good to have both of you 
with us.
    Justice Scalia, should ACUS in your opinion be established 
as a part of another agency such as Department of Justice or 
GSA, for example, A? And should it be privatized, B?
    Justice Scalia. A is easy. I don't think it would be 
effective if it were a part of any other agency. It was set up 
originally as an independent agency, and I think it has to be 
that in order to have the confidence of the other agencies with 
which it's dealing. As you know, there are some interagency 
jealousies and reservations which I think would make its 
studies more difficult if it were a subunit of some other 
department. Besides which, I think being accountable to a 
Secretary of some Department or to the Attorney General would 
eliminate its independence, which is its whole value. It's not 
supposed to reflect the view of the current Administration or 
of the current Justice Department. It's supposed to represent 
the intelligent, informed view of those who are expert within 
the academic community, the practicing bar, and the Government. 
So if you want to have that, I think you have to make it an 
independent agency. I think it would hurt it to put it under 
something else.
    Now, the second question, should it be privatized? I'm not 
sure what you mean by that. I think it has to be within the 
Government because, as I indicated in my initial comments, you 
have an entree to the agencies. No agency likes to be studied. 
Anybody who says, you know, ``We welcome a study,'' they're 
kidding you. Everybody would like people to go away and leave 
me alone.
    But if you have an agency that has the respect of other 
agencies and in which a representative from that agency itself 
is on the Conference, which was usually the case, your chances 
of being able to do a thorough study with the cooperation of 
the agency are vastly increased. That could not be done by a 
private operation.
    Mr. Coble. Thank you, sir.
    Justice Breyer, in this town much is made over, oh, it must 
bipartisan. Well, I'm an advocate of bipartisanship as well, 
but by the very nature of this city, it's the capital city of a 
Republic of 50 States, and some issues by their very nature and 
make-up are going to be partisan. Justice Scalia I think 
answered this, but let me put it to you, if I may.
    How important is it to preserve the bipartisan, 
nonpolitical nature of ACUS?
    Justice Breyer. It's fairly important. I can't recall in 
the time I was there--I don't want to say none, but I can't 
recall any significant number of issues coming up where 
partisanship made much of a difference. You know, there could 
have been some, but it's at a level where what is the partisan 
view of separation of functions in rulemaking? You know, for 
most--that's not true 100 percent, but most of it, it doesn't 
take place in the discussion at a partisan level.
    Mr. Coble. Thank you, sir.
    Mr. Chairman, I want you to take judicial notice that I 
beat the red light, and I yield back my time. And thank you, 
again, gentlemen, for being with us.
    Mr. Cannon. I thank the gentleman.
    Mr. Watt, would you like 5 minutes?
    Mr. Watt. Thank you, Mr. Chairman.
    Justices, reading from the briefing memo that the Committee 
Members got, just to establish a foundation for a question that 
I want to follow up with, the Administrative Conference was 
established as a permanent, independent agency in 1964 and 
became operational 3 years later. The Conference was created to 
develop recommendations for improving procedures by which 
Federal agencies administer regulatory, benefit, and other 
Government programs. It served as a private-public think tank 
that conducted basic research on how to improve the regulatory 
and legal process. After failing to be appropriated funds for 
fiscal year 1996, ACUS ceased operations as of October 31, 
1995, and the statutory provisions establishing ACUS have not 
been repealed.
    Justice Breyer gave us a great snapshot of some of the 
things that the Conference did to formalize and clarify 
procedures that were absolutely necessary. I sense that we are 
probably continuing to benefit from the work that the 
Conference did over the years of its existence in establishing 
knowable and uniform procedures.
    I'm wondering if either of you may have examples of some of 
the problems that have been created since 1995 when the 
Conference went out of existence that might have been avoided 
had the Conference been in place.
    Justice Breyer. We won't know. I remember one of the things 
they were working on earlier when I was--it was before I was 
appointed to the Supreme Court. I was on the court of appeals. 
A question that's always been a tough one, but very 
interesting, is the problem of negotiated rulemaking. Rules 
take us sometimes a very long time to write, and the problem 
they deal with almost goes away by the time they get them 
written and through the courts. And there was an idea that we 
could produce a negotiated process, and that's not an easy 
thing to do because sometimes there are people left out of the 
table.
    They've done studies on that, and maybe that's made a lot 
of progress without them. Maybe it hasn't. I haven't heard too 
much about it.
    Mr. Watt. That was still a work in progress at the end of 
the----
    Justice Breyer. I think a continuous set of works in 
progress. But the short answer is I don't know.
    Justice Scalia. That's my answer, too, Congressman. And 
it's not easy to know. The biggest part of my job when I was 
Chairman was precisely identifying problems to study. Most of 
them are under the surface. They don't leap out at you. If they 
leapt out at you, there would be legislation covering the 
problem. That's usually not the case. It takes some work to 
discover what the real problems are and to discover how to 
solve them.
    Anyway, you know, I have been out of that business for a 
while now. I'm now in the business of creating problems rather 
than solving them. [Laughter.]
    Justice Breyer. That's what I was thinking. I was thinking 
that since we've both been on the Court, my guess is that we 
could get a pretty good agenda for them.
    Mr. Watt. I would sense that maybe the people who would be 
most knowledgeable about the problems that may be surfacing as 
a result of not having the Conference in place would be 
ordinary citizens who are trying to work their way through a 
process that there's really--or improve a process that there's 
really no formalized procedure in place at present to improve. 
So I----
    Justice Scalia. Either citizens, Congressman, or the 
specialized bar that services that particular segment of the 
community--maybe the immigration bar or the bar that handles 
Veterans Administration appeals, things of that sort. That's 
where you usually get the signals from.
    Mr. Watt. Now, the ABA's letter has certainly been 
vigorously in favor of doing this. It may be that some of their 
committees have stepped into that void and they'd like to get 
back out of it and formalize it in a different sense, or be 
participants in it but not necessarily the only voice that's 
being heard in that----
    Justice Breyer. That's exactly right, because the 
Administrative Law Section of the American Bar Association has 
always been active in this area, and both, they co-existed. But 
what the Conference could do that the Ad. Law Section couldn't 
do is just what Justice Scalia is talking about: they could get 
the access to the information inside the Government and the 
off-the-record reactions of people in charge of those agencies. 
So it produced a conversation that you can't have as easily 
just through the ABA.
    Justice Scalia. I was Chairman of the Ad. Law Section for a 
year, and there's a big difference between showing up at an 
agency and saying, ``I'm from the American Bar Association, I 
want to know this, that, and the other,'' and coming there from 
the Administrative Conference which has a statute that says 
agencies shall cooperate and provide information. It makes all 
the difference in the world.
    Mr. Watt. Thank you, Mr. Chairman. I've always wanted to 
question Supreme Court Justices and be on the other side of the 
fence.
    Mr. Cannon. This is actually pretty cool, isn't it?
    Mr. Watt. Yes, this is nice. [Laughter.]
    I will yield back. I'll resist the temptation to go well 
beyond the 5 minutes. I thank both witnesses and thank you for 
being here, and I yield back.
    Mr. Cannon. The gentleman yields back.
    The gentleman from Florida, Mr. Feeney, is recognized for 5 
minutes.
    Mr. Feeney. Thank you, Mr. Chairman. I apologize for being 
a little bit late, but I want to also thank Justice Breyer and 
Justice Scalia for all that you do to help our country in 
administering the third branch of Government under article III. 
I want to tell you that I think everybody on this Committee, 
regardless of their partisan nature, wants to work with you to 
find ways to facilitate the administration of justice in a 
manner that best serves our country under the principles of the 
Constitution.
    And I guess to try to throw you what I hope will be a soft 
ball, maybe in my short time--I've read your testimony and we 
appreciate just how far we've come since 1946, for example, in 
the Administrative Procedure Act. I'd like to ask both of you, 
given that you're not only, you know, great Justices but that 
you've got a great historical background in terms of the 
judicial system and with the changes from Justice Marshall 
right up through today, if you would maybe give us some 
predictions about what our court system will look like not 50 
years ago but 50 years from now as we continue to evolve as a 
society. Maybe you could some forward thinking for us, if it's 
not asking too much.
    Justice Scalia. I'm hesitating, Congressman, because 
Justice Breyer and I came here to talk about the Administrative 
Conference, and I am afraid that if I answer your question, I 
am going to be on what is known as the slippery slope. We 
really didn't come to talk about the courts, and----
    Mr. Cannon. May I just suggest, we were just talking with 
staff, and, frankly, we would appreciate it if all the Members 
of the Committee would focus on ACUS. I don't mean to correct 
you because that's a fascinating question that I'd like to----
    Mr. Feeney. In that case, I'll withdraw my question
    Mr. Cannon.--sit around with a root beer and talk to the 
Justices about.
    Justice Breyer. I'll say one thing about the difference. An 
administrative process, by and large, is individuals dealing 
with a bureaucracy. It's absolutely necessary, it's supposed to 
be accessible, and it's supposed to help. The judicial branch 
is the last place, I think--maybe Congress still is--where an 
individual who has a problem with the Government comes into a 
courtroom and looks face to face at the sole individual, 
usually a district judge, who is going to make that decision.
    Now, to me, that's an incredibly valuable thing. And to me 
as well, although the judicial process is too expensive and it 
takes too long, I think it's essential to preserve its nature, 
which is not an administrative bureaucracy. And there is room 
for both. So I can't predict but I can hope, and I hope that 50 
years from now the judicial branch will still not be a 
bureaucracy; it still will be a place where the individual 
comes face to face with that high Government official who will 
decide his or her case; and I also hope it will be a lot less 
expensive and will be run more expeditiously.
    But as I say, those are hopes and they are not predictions.
    Justice Scalia. He's provoked me now. [Laughter.]
    If I were going to compare the two, one of the great things 
about our judicial system is that our courts are not a 
bureaucracy. It is the principal difference between our 
judicial system and the judicial systems of most of the civil 
law countries. In the Anglo-Saxon system, a judge becomes a 
judge, at least on a prestigious court such as a Federal 
district court or any of the Federal courts, at the summit of a 
successful legal career. He not only has not been a bureaucrat 
his entire life, he has usually been litigating against the 
Government. So he comes on to the bench with a really 
independent mind. He is not inclined to swallow everything the 
Government tells him and so forth.
    In the civil law system, you become a judge right after law 
school. You pick your career. If you want to become a judge, 
you start off as a baby judge and you get promoted through the 
whole judicial system. This creates a wholly different mindset. 
The strength of our courts is precisely that they are not a 
bureaucracy. And that's why they can help the citizen 
confronted with a sometimes misunderstanding bureaucracy. But I 
don't want to talk about the court----
    Mr. Cannon. If the gentleman yields back, let me just point 
out that the comments from the panel are very important in the 
context of what we're doing here because, before you get to a 
judge, you often have to go through a very long process. And 
the fact that a judge who may be a little bit contrary to the 
Government, has an independent streak, is going to oversee 
that, is a remarkably important part of the process. But, of 
course, how we get that person through the process, his claims 
are adjudicated, are dealt with early, saving him time and 
money is very, very important. So we appreciate that.
    I'd like to inform the panel that we expect five votes 
within about 10 minutes from now, so I am going to actually tap 
the gavel at 5 minutes. And I hope that we have--Mr. Delahunt, 
did you want to take 5 minutes?
    Mr. Delahunt. I will try to limit myself.
    Mr. Cannon. Let me just poll the panel here. I take it, Mr. 
Conyers, you'd like to ask questions. Mr. Scott, yes. Good. Let 
me recognize Mr. Delahunt. We'll go to Mr. Scott. If there is 
some time left, I will wrap. But we do have votes coming, so 
let's watch the clock.
    Thank you, Mr. Delahunt.
    Mr. Delahunt. Thank you, Mr. Chairman. And welcome to both 
judges, and a particularly warm welcome to Justice Breyer, who 
served, as you've indicated and as he's alluded to, in the 
First Circuit, where he served so well and earned the 
admiration of the Massachusetts Bar and the citizens of 
Massachusetts and obviously other States encompassed in it. 
It's good to see you, Judge.
    Justice Breyer. Thank you.
    Mr. Delahunt. Clearly, both of you indicate, you know, 
support for reauthorization, and as we discuss it among 
ourselves, I dare say there's a consensus that when it was 
functioning, it served a very valid purpose. I think both of 
you have at least implicated that it resulted in efficiencies, 
improvements that translated into savings--savings of tax 
dollars.
    I'd speculate that this panel and most likely the full 
Committee would support reauthorization. I think that's the 
inclination of the Chair of the Subcommittee. I can't find any 
reason not to. Is there any reason not to? Let me pose that 
question to you.
    Justice Scalia. Well, there's always money, but I guess 
nobody's mentioned, and I meant to mention at some point in my 
testimony, that I think the Administrative Conference was an 
enormous bargain because you are really getting the benefit of 
the legal advice of, I think, some very good private lawyers 
whose time nowadays probably goes out at 500 bucks an hour or 
something like that. Their time was contributed. They got no 
compensation for serving on the Assembly of the Conference. The 
only expense to the Government was their travel expenses to 
come to Washington for the meetings. But they expended a 
considerable amount of time in committee meetings, in preparing 
drafts of recommendations--and all of this was provided to the 
Government gratis.
    Mr. Delahunt. It's a good investment. You know, earlier, I 
think it was you, Justice Scalia, that indicated--I mean, this 
is not an issue that's attracting a standing-room-only crowd. 
You know, it's tough to keep your eyes open.
    Justice Scalia. I'd worry for the country if it did, 
Congressman. [Laughter.]
    Mr. Delahunt. Right. And I would concur with those 
sentiments. But I think it was you, Justice Breyer, that 
indicated that during your tenure there and during the course 
of the AC's existence, you know, there were significant 
savings, that it's a good investment. It wasn't just a question 
of taking advantage of high-priced talent, but the results 
translated into efficiencies that, in fact, saved considerable 
dollars.
    We have to--if this Committee at some point in time should 
have legislation before it and it leaves here, our 
responsibility is going to be to sell it to our colleagues to 
ensure passage. And I think what our responsibility is--and I 
think your testimony, both of your testimony here today have 
provided a record to be able to honestly relate that this is a 
way to save money, as well as to make it more streamlined.
    Mr. Cannon. Would the gentleman yield?
    Mr. Delahunt. Sure.
    Mr. Cannon. Justice Scalia, you just said that you compared 
the value or the cost to the Government with the value of the 
inputs, that is, a $500-an-hour lawyer. And I think Mr. 
Delahunt is moving toward another perspective, which is that we 
got a lot of value out. We would just love, for the record, if 
you have some way to give us a comparison between, say, the $3 
million we're looking at authorizing and the value Government 
gets as product.
    Justice Breyer. Suppose, for example, that you--and I think 
this is a fair example. In a world where it did at one point 
take an average of several years from the time a rulemaking was 
considered until the time it went into effect as a result of 
improved procedure you cut a month or two off that process, as 
undoubtedly regulatory rulemaking negotiation, even where 
imperfect, did, and cut off far more than that, well, you've 
saved your $3 million right there.
    Mr. Cannon. That might be billions of dollars.
    Justice Breyer. It could. It easily could, a major 
environmental rule, and that's not even taking account of the 
fact that the environment will then be protected that much 
sooner. So there is huge saving directly to the public, I 
think, through a more efficient set of rules.
    Mr. Delahunt. Mr. Chairman, what I would recommend is that 
you, along with the Ranking Member, request either the CRS or 
some appropriate agency to conduct a review, if you will, that 
could prospectively provide us at least a vague range of the 
savings that could be effected if it was reauthorized, and 
maybe we could end up passing this, getting it on the 
suspension calendar, and go where we should.
    Thank you. Thank you, Judge.
    Mr. Cannon. We expect to have another panel at some point 
in the future. Maybe we can get that cost/benefit then. But let 
me just say for the record now, it appears to me that we're 
talking about a few million dollars compared to billions of 
dollars in cost to industry, and as Justice Breyer pointed out, 
a failure to implement protections to save the environment 
which may be incalculable in value.
    Justice Scalia, I think you----
    Justice Scalia. I was just going to say, don't judge it 
just on how much money it saves, because not all of its 
recommendations are money-saving recommendations. There are two 
values involved here: one is efficiency, the other one is 
fairness. Sometimes you have agencies' procedures that are just 
unfair, and it might take a little more money to make them 
fair. But you'd want to do that.
    So I don't think you can just judge it on the basis of 
financial cost saving, although I wouldn't be surprised if it 
ended up having saved money overall in its recommendations.
    Mr. Cannon. Thank you, Justice Scalia.
    We've had Mrs. Blackburn from Tennessee join us. We have a 
short--time is--we have a vote coming up, and I was going to 
recognize Mr. Watt first, if that would be okay with you--
pardon me. My Ranking Member is so prominent in my mind that I 
sometimes mistake that. Mr. Scott, would you like to be 
recognized for 5 minutes?
    Mr. Scott. Thank you, Mr. Chairman.
    When Justice Breyer talked about a rate setting, it 
reminded me of that line in ``A Man for All Seasons'' when Sir 
Thomas More was charged more than the regulated rate for a boat 
trip, and the response from the boatsman was that the fee 
coming this way downstream is the same as the fee going back 
upstream. Whoever set the rate doesn't row a boat. [Laughter.]
    Justice Scalia. I remember that line.
    Mr. Scott. And I've remembered that.
    The Conference presents nonpartisan, well-documented facts 
and analysis. We ought not be afraid of intelligent experts' 
advice, even if it disagrees with our political position. And 
so I've always been a supporter of the Conference.
    Let me just ask one question. The members of the Conference 
don't fall out of the sky. The executive branch, the President 
appoints the Chairman. Who appoints the others? And should that 
be looked at?
    Justice Scalia. That's in my testimony. The Chairman is 
confirmed by the Senate, so it's not just a Presidential 
appointment. The private members of the Conference are 
appointed just by the President. And--I think that's right. 
Yes. And I think one of the jobs of the Chairman is to make 
sure that the organization does not become a partisan 
organization, that it is not used in order to further the 
policies of the current Administration. If that happens, it is 
deprived of all of its usefulness.
    Mr. Scott. Is there something we can do in the 
appointment--membership appointment process to make that more 
likely?
    Justice Scalia. I think you have to be very careful in 
selecting the Chairman. I think it's the Chairman's job. You 
have to remain friendly to the Administration. You know, if the 
Administration thinks that you're a bomb thrower and, you're 
going to be hostile to them, you're not going to get the kind 
of access you need. But, on the other hand, you cannot let the 
Administration load up the Conference with people who don't 
have the expertise that you want or with people who have axes 
to grind. It's up to the Chairman to fight against that. And to 
the extent he's unsuccessful, the Conference will not be what 
it ought to be.
    Justice Breyer. You might, Congressman, put a word 
``bipartisan'' somewhere, you know, appropriate as an 
objective. I used to attend the meetings when President Carter 
was President and then again when President Reagan was 
President. And so I saw that change of Administrations. I don't 
think it makes a big difference. It made some difference. I 
wouldn't say zero. But I don't think it made an enormous 
difference to the output of the Conference.
    Mr. Scott. Were Chairmen reappointed?
    Justice Breyer. No. There were different Chairmen, and it 
was viewed as a prerogative of the Administration. But as I 
say, the nature of the entity was such that they were searching 
for bipartisan members. It mostly--there were law professors 
and there were private practitioners. So that's why I say--I 
didn't think it was a problem, but I can't say it's a zero 
impact. So urging I think helps. I don't think it's necessary 
to legislate it.
    Mr. Scott. Thank you, Mr. Chairman.
    Justice Scalia. I take back what I said earlier. The public 
members were appointed by the Chairman with the approval of the 
Council. So it wasn't a matter of the President appointing the 
private members. The Chairman did have good control over who 
went into the body of the Conference. And so long as he was 
able to resist any untoward pressures from the Administration 
to appoint people that they for some reason--I don't know--owed 
a debt to or wanted to put in there so that they could push 
Administration policies, it was the job of the Chairman to 
resist that. And he had the power to do it because ultimately 
he was the one who nominated the members of the Assembly. And 
it worked very well in that manner, for as long as I knew it 
anyway.
    Justice Breyer. I would hope that they would go back for 
the first set of appointments and look for some people that 
have a historic memory--there are a lot of them around--to try 
to reconstruct the mores of the institution.
    Mr. Cannon. It is my sense that the power of the 
Administrative Conference is actually derived from the 
credibility of the members, and that if you ever got in a 
partisan situation, it would destroy the reputation of the 
Chairman, principally, and would set the Conference back a year 
or two or three before you would get it changed out and get new 
people in. And no man or woman who is of the stature to become 
Chairman of the Administrative Conference is going to allow his 
or her reputation to be destroyed over partisanship when, in 
fact, no matter how partisan you are, the rules are the 
critical thing here. And administrative interests are best 
protected by having clear rules that then the Administration 
and political people can play with.
    Justice Scalia. That is absolutely true. And let me mention 
one other factor. As I said in my prepared testimony and in my 
opening remarks, the initial Chairmen of the Conference--and I 
think this continued for a long time--were academics. And you 
can't push academics around too much because, you know, ``I'll 
just go back to teaching, which is a great racket. I don't have 
to stay in Washington.'' So, that was, I think, one of the 
strengths of the Conference, that it usually had an academic as 
the Chairman. You just can't push them around too much.
    Justice Breyer. I agree.
    Mr. Cannon. Thank you. That is a bell for votes. We have 15 
minutes. That should leave us time. Mrs. Blackburn?
    Mrs. Blackburn. Thank you, Mr. Chairman.
    Mr. Cannon. The gentlelady is recognized for 5 minutes.
    Mrs. Blackburn. Thank you, Mr. Chairman. And we do have the 
vote, and we need to get out of here. And I've enjoyed 
listening to your comments.
    I would just say very quickly, you've talked a little bit 
about the importance of the bipartisan, nonpolitical nature of 
the ACUS, and what I--and I'll have to say this: sometimes in 
the day and age in which we live, when our constituents hear 
about trying to eliminate waste and red tape and reports from 
the GAO and the CRS and Government reform and the Inspector 
Generals and the CFO and the CFO Act, many times their eyes 
just glaze over. And so we appreciate you all and your concern 
and your attitude toward this and toward the hearing.
    What I'd like to hear from you very quickly is, in light of 
all of this and looking at the bipartisan, nonpolitical nature, 
if you will, of the ACUS, what would you see as being the top 
priorities for a reconstituted ACUS?
    Justice Scalia. I think it's similar to a question that was 
asked earlier, and my response to that was I have been out of 
the business for too long to know what the first things I would 
investigate are. Probably the most difficult job of the 
Chairman was precisely to identify those areas that are worthy 
of study. That's what I spent most of my time doing; it doesn't 
jump up at you. You have to take some time to speak to a lot of 
people and find out what are the most pressing concerns in the 
administrative field--which, as you point out, is a very dull 
field that not many people are interested in. But there are 
those of us who love it.
    Justice Breyer. Yes. We are administrative law buffs. 
[Laughter.]
    I can't say what's the most important for the same reason, 
but it does come to mind the fact that we in our Court have 
divided about five ways about the correct meaning of a case 
called Chevron, which has significance. And if I were running 
that now, I think maybe one thing I might like to do is to ask 
the agencies whether the five different things that we have 
said have mattered. Has it hurt them? Has it helped them? 
That's a subject they might look into.
    Mrs. Blackburn. Well, I agree with you. I think those could 
be instructive. And for those of us in each branch of 
Government and across the field that do appreciate an 
effective, efficient administrative process, it would be a 
question worth answering. And I think we will depart for the 
votes, and, Mr. Chairman, I thank you for the time.
    Mr. Cannon. Thank you. I do have a couple of questions to 
follow up.
    Just along this line, while I recognize that you both are 
out of this business, it seems to me there's some large trends 
in society that might be appropriate for the Administrative 
Conference. For instance, litigation has increased, especially 
in some of the environmental areas. We have a phenomenal 
flourishing of science in America, and we're not integrating 
that very well, I don't think yet, into our administrative 
process. We have communication processes that are remarkable, 
online processes that allow people to keep track of everybody's 
comments and everybody's input and communications between 
people within and without an agency. And, of course, there's 
always the need to create an environment where we can have more 
transparency, and there are probably limits on that.
    So it would seem to me that some of those areas--and there 
may be others in your mind--where as a matter of broad scope, 
the nature of society has changed, and, therefore, the focus of 
ACUS may be appropriate to be adjusted to look at those things.
    Justice Scalia. Well, I would certainly tell the new 
Chairman, one thing you might look into is whether 
teleconferencing couldn't be used by agencies more than it is. 
I don't know whether that's something that is taken advantage 
of as much as it ought to be. Certainly there have been 
enormous strides in the facility of that procedure, the cost of 
it, and how close it comes to being in the same room. I don't 
know if the agencies are doing enough with that. Maybe that's 
one thing the Conference might look into. Instead of having 
lawyers and citizens come to Washington or to Peoria--wherever 
they have their hearings--maybe things could be done over the 
phone. I don't know.
    Justice Breyer. I think science is a very, very good idea, 
good subject, because scientists disagree about a lot of 
things, but, still, the serious scientists are within a range 
of disagreement. And how to create a process that focuses the 
actual controversy within what I would call the consensus range 
is a hard topic to do. It's been very difficult in the courts. 
We've had cases trying to focus on that issue. In Britain and 
in continental Europe, they've had major studies and major 
efforts to reform their judicial system in that respect, and 
they've proved reasonably successful.
    So there's a lot to look at, and I think if you could make 
progress in that area, that would be very helpful to everyone.
    Mr. Cannon. Do either of you have an opinion as to whether 
it would be useful to have Members of Congress on the 
Administrative Conference?
    Justice Breyer. I'm not sure that it would.
    Justice Scalia. I don't know any Member of Congress who is 
an expert in administrative procedure. And I don't want anybody 
on the Conference who's not an expert in administrative 
procedure.
    Justice Breyer. The nature of the job is so different. I 
mean, the nature of the job as a person in Congress is to 
respond to those issues that are at a level where they have a 
generalized response--a generalized impact upon----
    Mr. Cannon. You're cutting me out of the process, which is 
sort of painful, I might say, with all due respect. [Laughter.]
    Justice Scalia. You have enough work to do, Mr. Chairman.
    Mr. Cannon. What I was thinking, actually, is perhaps 
Members of--or Chairmen of the Committees that deal with 
administrative law may have an ad hoc or some other sort of 
role.
    Justice Scalia. Well, they're welcome to attend all of the 
plenary sessions, and I'm sure any of the committees would be 
delighted to have a Member of Congress sit in on the committee 
meeting. I think maybe one useful thing that could be done is 
to keep Congress informed of when all of these committee 
meetings occur. If they want to attend, fine.
    Justice Breyer. Congressional staffs I think did sometimes 
come.
    Justice Scalia. Staff did come to the plenary sessions. I'm 
sure of that.
    Mr. Cannon. Let me just ask then a very general question. 
Are there any recommendations you would have for how to change 
what was the Administrative Conference as we go forward in the 
future?
    Justice Breyer. No, I haven't thought about that.
    Justice Scalia. I haven't given thought to it, Mr. 
Chairman, and I don't want to do it off the top of my head. 
Nothing immediately occurs to me. The most important thing is 
what I mentioned earlier. You have to be very, very demanding 
in the selection of the chief executive officer. I think it 
makes a big difference if you get people like Jerre Williams 
and Roger Crampton, good, solid people who will keep it on the 
right track.
    Mr. Cannon. I must say that I--you've said many of the 
things that I have wanted in this record. We appreciate that. 
The Administrative Conference has been great and been effective 
because of the kind of people that have run it and the kind of 
people that have contributed their time. I certainly would like 
to see it reestablished. I think it would have a great benefit 
to the American people, far beyond the nominal costs that we're 
looking at right now.
    We thank you very much, both of you, for coming down. You 
honor us with your presence, and you've done great service to 
our cause of bringing back the Administrative Conference to 
America. Thank you.
    Justice Breyer. Thank you.
    Justice Scalia. Thank you, Mr. Chairman, Members of the 
Committee.
    Mr. Cannon. We will now be adjourned. Thanks.
    [Whereupon, at 3:08 p.m., the Subcommittee was adjourned.]


                        WHY IS THERE A NEED TO 
                      REAUTHORIZE THE CONFERENCE?

                              ----------                              


                        THURSDAY, JUNE 24, 2004

                  House of Representatives,
                         Subcommittee on Commercial
                            and Administrative Law,
                                Committee on the Judiciary,
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 2:30 p.m., in 
Room 2237, Rayburn House Office Building, Hon. Chris Cannon 
(Chair of the Subcommittee) presiding.
    Mr. Cannon. The Subcommittee will please come to order. I 
apologize for being late. We appreciate your being here and I 
apologize to this esteemed panel for keeping you waiting. This 
is a matter of great interest and great concern and great 
importance. I think that you are important people and so I 
appreciate your sufferance because I believe you all believe 
the same thing about the Administrative Conference.
    Last month, as you may recall, our Subcommittee held its 
first of two oversight hearings regarding the issue of whether 
the Administrative Conference of the United States should be 
reauthorized. Supreme Court Justices Antonin Scalia and Stephen 
Breyer, the two witnesses at last month's hearing, 
enthusiastically testified about the many benefits and 
accomplishments of ACUS. The Justices concurred in what may be 
for them a rare unanimous opinion in their unqualified support 
for the Conference's reauthorization. This first hearing, at 
which not one but two esteemed Supreme Court Justices extolled 
the virtues of ACUS, clearly underscores the importance of the 
Conference and significance of our efforts to reauthorize it.
    To build on that record, today's hearing is intended to 
focus in greater detail on exactly how we should go about 
reauthorizing the Conference. Specifically it is my hope that 
our witnesses will further explain the need for reauthorizing 
ACUS and provide guidance with respect to the form in which the 
Conference should be reauthorized, the priorities that a 
reauthorized ACUS should consider, and the anticipated amount 
of funding necessary to reauthorize the Conference.
    For those who are not familiar with the work and the 
accomplishments of the Conference let me briefly explain. Over 
the course of its 28-year existence the Conference issued more 
than 200 recommendations, some of which were Government-wide 
and others that were agency-specific. It issued a series of 
recommendations eliminating a variety of technical impediments 
to the judicial review of agency action and encouraging less 
costly consensual alternatives to litigation. The fruits of 
these efforts included the enactment of the Administrative 
Dispute Resolution Act in 1990, which established a framework 
for the use of ADR.
    In addition to those accomplishments, ACUS served as the 
chief implementing agency for the Negotiated Rulemaking Act, 
the Equal Access to Justice Act, and the Congressional 
Accountability Act. The Conference also played a key role in 
the Clinton administration's National Performance Review 
Project with respect to improving regulatory systems. 
Throughout its existence, ACUS has served as a valuable 
resource for Members of Congress, Congressional Committees and 
various Federal agencies.
    Some might ask, how can we justify reestablishing and 
funding another Government agency, especially in this belt-
tightening environment? The answer, at least to me, is obvious. 
According to the Congressional Research Service, there are 
growing patterns of evasion among the agencies with respect to 
notice and comment requirements as evidenced by the increasing 
number of regulations being successfully challenged in the 
courts. An informal study by CRS indicates that 51 percent of 
these rules were struck down by the courts. Needless litigation 
hurts everyone. It slows the rulemaking process, encourages 
agencies to try to circumvent public comment requirements, and 
costs taxpayers, I might add industry, millions or billions of 
dollars.
    Another serious area of concern is the lack of a coherent 
approach among the agencies with respect to emerging issues and 
technologies. These issues include, for example, how the 
Government should handle private information it collects from 
our Nation's citizens and how agencies in this Internet age can 
promote greater public participation in the regulatory process. 
There are also concerns about the need to have peer review and 
to have regulations well grounded in more or less clear 
science. Our Nation's people and business communities depend 
upon Federal agencies to promote scientific research and 
develop science based policies that protect the Nation's health 
and welfare. Integral to the Federal regulatory process is the 
need to assess the safety, public health and environmental 
impact of proposed regulations. Regulations lacking scientific 
support can present serious safety and health consequences as 
well as cause the private sector to incur unnecessary and 
burdensome compliance costs. Businesses suffer with the ability 
to prioritize their investments, and that is a very serious 
problem. Restoring the Conference in some form, from my 
perspective, would provide a cost effective yet highly valuable 
solution to these problems.
    It is against this backdrop that I look forward to hearing 
from our witnesses today. Now I turn to my colleague, Mr. Watt, 
the distinguished Ranking Member of the Subcommittee and ask if 
he has any opening remarks.
    [The prepared statement of Mr. Cannon follows:]
 Prepared Statement of the Honorable Chris Cannon, a Representative in 
    Congress From the State of Utah, and Chairman, Subcommittee on 
                   Commercial and Administrative Law
    The Subcommittee will please come to order.
    Last month, as you will recall, our Subcommittee held the first of 
two oversight hearings regarding the issue of whether the 
Administrative Conference of the United States should be reauthorized. 
Supreme Court Associate Justices Antonin Scalia and Stephen Breyer, the 
two witnesses at last month's hearing, enthusiastically testified about 
the many benefits and accomplishments of ACUS. The Justices concurred--
in what may be for them a rare unanimous opinion--in their unqualified 
support for the Conference's reauthorization.
    This first hearing--at which not one, but two esteemed Supreme 
Court Justices extolled the virtues of ACUS--clearly underscores the 
importance of the Conference and the significance of our efforts to 
reauthorize it. To build on that record, today's hearing is intended to 
focus in greater detail on exactly how we should go about reauthorizing 
the Conference. Specifically, it is my hope that our witnesses will 
further explicate the need for reauthorizing ACUS and provide guidance 
with respect to the form in which the Conference should be 
reauthorized; the priorities that a reauthorized ACUS should consider; 
and the anticipated amount of funding necessary to reauthorize the 
Conference.
    For those of you who are not familiar with the work and 
accomplishments of the Conference, let me briefly explain.
    Over the course of its 28-year existence, the Conference issued 
more than 200 recommendations--some of which were government-wide and 
others that were agency-specific. It issued a series of recommendations 
eliminating a variety of technical impediments to the judicial review 
of agency action and encouraging less costly consensual alternatives to 
litigation. The fruits of these efforts included the enactment of the 
Administrative Dispute Resolution Act in 1990, which established a 
framework for the use of ADR.
    In addition to these accomplishments, ACUS served as the chief 
implementing agency for the Negotiated Rulemaking Act, the Equal Access 
to Justice Act, and the Congressional Accountability Act. The 
Conference also played a key role in the Clinton Administration's 
National Performance Review Project with respect to improving 
regulatory systems. Throughout its existence, ACUS served as a valuable 
resource for Members of Congress, Congressional Committees, and various 
Federal agencies.
    Some might ask, ``How can we justify reestablishing and funding 
another governmental agency, especially in this belt-tightening 
environment?''
    The answer--at least to me--is obvious. According to the 
Congressional Research Service, there are growing patterns of evasion 
among agencies with respect to notice and comment requirements as 
evidenced by the increasing number of regulations being successfully 
challenged in the courts. An informal study by CRS indicates that 51% 
of these rules were struck down by the courts. Needless litigation 
hurts everyone--it slows the rulemaking process, encourages agencies to 
try to circumvent public comment requirements, and costs taxpayers 
millions of dollars.
    Another serious area of concern is the lack of a coherent approach 
among the agencies with respect to emerging issues and technologies. 
These issues include, for example, how the government should handle 
private information it collects from our nation's citizens and how 
agencies--in this Internet Age--can promote greater public 
participation in the regulatory process.
    There are also concerns about the need to have peer review and to 
have regulations based on sound science. Our nation's people and 
business communities depend upon Federal agencies to promote scientific 
research and to develop science-based policies that protect the 
nation's health and welfare. Integral to the Federal regulatory process 
is the need to assess the safety, public health, and environmental 
impact of proposed regulations. Regulations lacking sound scientific 
support can present serious safety and health consequences as well as 
cause the private sector to incur unnecessary and burdensome compliance 
expenditures. Restoring the Conference in some form--from my 
perspective--would provide a cost-effective, yet highly valuable 
solution to these problems.
    It is against this backdrop that I look forward to hearing from our 
witnesses today.

    Mr. Watt. Thank you, Mr. Chairman, and I thank the Chairman 
for convening another hearing on this subject, the 
reauthorization of the Administrative Conference of the United 
States. If this works, the process that we are following, this 
will be a classic example of how the legislative process should 
work, which is to say you start by thinking about whether there 
is a need for something to be reauthorized or to be approved 
and you have a series of legislative hearings to document the 
need that you think exists and to document the arguments 
against whatever you are proposing and to evaluate how you 
ought to implement or reauthorize.
    We started this process, thanks to the Chairman, with two 
distinguished members of the United States Supreme Court and 
both of them were in agreement about the need for the 
Administrative Conference of the United States, and we are 
taking this second step in the process with what appears to be 
an equally distinguished panel of witnesses, and I am looking 
forward to hearing their testimony. We obviously have our 
predilections about the need for reauthorizing the 
Administrative Conference of the United States, but need to 
hear from people who have dealt with it more close up, more 
hands on and to justify having such an entity in place and, if 
there is a need for it, justify how it ought to be 
reauthorized.
    So I thank the witnesses for being here, and I am looking 
forward to your testimony, and I am looking at the reporter now 
who is saying, man, he talks a lot slower than that other guy, 
which was the reaction that I used to get when I was practicing 
law. All of the court reporters loved me because I do talk slow 
enough that they can take down what I am saying.
    Mr. Cannon. You are thinking as you are talking, and I was 
reading and that is probably why. I just try to get through the 
reading so we can get to the real stuff and ask questions.
    Mr. Watt. All right. Well, I yield back. I appreciate you 
having a hearing and I certainly support the process and the 
objective.
    Mr. Cannon. I thank the gentleman. Without objection, the 
gentleman's entire statement will be placed in the record. It 
has been a pleasure to work with the Ranking Member on this 
issue and on many other issues. He and his staff have worked 
with us and it has been good to move this process forward. I 
think it has been a thoughtful process, and I think we are at a 
point where after this testimony we are able to refine what we 
project to do and get some legislation moving.
    Without objection, all Members may place their statements 
into the record at this point. Any objection? Hearing none, so 
ordered.
    Without objection, the Chair will be authorized to declare 
a recess of the Subcommittee today at any point. Hearing no 
objection, so ordered.
    I ask unanimous consent that Members have 5 legislative 
days to submit written statements for inclusion in today's 
hearing record.
    In that regard I ask unanimous consent that the record 
include two letters we received in support of reauthorizing the 
Conference, both of which were previously distributed to the 
Subcommittee Members. The first is from Richard Chernick on 
behalf of the American Bar Association's Section of Dispute 
Resolution. The other is from Professor Paul Verkuil of the 
Benjamin N. Cardozo School of Law of Yeshiva University. 
Professor Verkuil is the Chair-elect of the Association of 
American Law School's Section on Administrative Law.
    [The information referred to follows:]
    
    
    
    
    
    
    
    
    
    
    Mr. Cannon. And now I would like to recognize the gentleman 
from North Carolina for 5 minutes for the purpose of making a 
statement on the record.
    Mr. Coble. Well, thank you, Mr. Chairman. I will be very 
brief, Mr. Chairman. I have another meeting I have got to 
attend, but I want to commend you and Mr. Watt. I think you two 
have done a good job of steering the Subcommittee on Commercial 
Administrative Law very adeptly through the sometimes shoals, 
reefs, and rocks that await you up here. But you all have 
managed to avoid those.
    As you pointed out, this is a very significant issue and, 
Mr. Chairman, you have assembled a very distinguished panel, 
not the least of whom is Mr. Watt's and my fellow Carolinian, 
Mr. Boyden Gray. But it is good to have all of you here. I 
apologize, Mr. Chairman, for departing, which is going to be in 
about 12 or 15 minutes, but I thank you.
    Mr. Cannon. Thank you for coming. Mr. Feeney, did you want 
to make any comments to start.
    Mr. Feeney. Well----
    Mr. Cannon. The gentleman is recognized 5 minutes.
    Mr. Feeney. Well, like Mr. Coble, I will have to be leaving 
early, too, but I have read the testimony of all the witnesses. 
Appreciate you being here. I am very optimistic, like Mr. Watt 
is especially, about this meeting. My short time here in 
Congress leads me to believe that there is an inverse 
relationship between how much work we get done in Committee and 
how many live TV cameras and microphones there are, so I am 
optimistic.
    Mr. Cannon. The suggestion being that we do boring and 
important stuff.
    Mr. Chabot, did you want to address the----
    Mr. Chabot. I enjoy boring stuff as much as anybody else 
does, Mr. Chairman. I am happy to be here this afternoon. But 
important stuff.
    Mr. Cannon. Thank you.
    Mr. Watt. Mr. Chairman, can I ask unanimous consent to 
submit for the record the testimony of Sally Katzen that has 
been offered for the record.
    Mr. Cannon. Without objection, so ordered.
    [The prepared statement of Ms. Katzen follows:]
                   Prepared Statement of Sally Katzen
    Mr. Chairman and Members of the Subcommittee:
    I greatly appreciate the invitation to testify in favor of the 
reauthorization of the Administrative Conference of the United States 
(ACUS). For the last several years, I have been teaching undergraduates 
(at Smith College) and graduate students (most recently at the 
University of Michigan Law School and at Johns Hopkins University); 
among the courses I teach are Administrative Law and The Regulatory 
Process. During the Clinton Administration, I served as the 
Administrator of the Office of Information and Regulatory Affairs at 
the Office of Management and Budget (1993-1998), where I was 
responsible for the development and implementation of the 
Administration's regulatory policy. Before joining the Clinton 
Administration, I was a partner in the Washington DC law firm of Wilmer 
Cutler and Pickering, where I specialized in administrative law. I also 
served as the Chair of the American Bar Association Section on 
Administrative Law and Regulatory Practice (1988-89).
    Most relevant in establishing my credentials on the subject of 
today's hearing is the extensive experience I have had with ACUS. I was 
first appointed a Public Member in 1988 while I was in private 
practice. I served on several of the ACUS committees, eventually 
chairing the Committee on Judicial Review. I was therefore actively 
involved in the preparation and presentation of various reports and 
recommendations of ACUS in the late 80's and early 90's. In l994, 
President Clinton appointed me one of the five government members of 
the Council (the governing board of ACUS) and designated me as the Vice 
Chairman. I served in that capacity (and for a time as Acting Chairman) 
until ACUS was closed.
    In fact, I was privileged to testify before this Committee on April 
21, 1994, in support of reauthorization of ACUS. [A copy of that 
testimony, which was reprinted in 8 Admin. L.J. Am. U. 649 (1994), is 
attached.] Today, I again urge your favorable consideration to 
authorizing ACUS as an independent agency to study administrative law 
issues and make recommendations to improve the efficiency, adequacy and 
fairness of the federal government's administrative procedures 
(paraphrasing the 1964 Administrative Conference Act).
    Others have testified about the significant substantive 
contributions made by ACUS, citing specific studies or recommendations 
or advice to the Congress, the Executive Branch and even the Judiciary. 
Others have made the point that the structure and composition of ACUS 
enabled a relatively modest amount of taxpayer funding (less than $3 
million annual appropriations) to be leveraged by the far greater 
contributions in kind by practicing lawyers and academics. And you have 
heard that several of the recommendations of ACUS actually saved the 
federal government significant amounts of money by increasing the 
efficiency of administrative processes without decreasing fairness for 
the participants. I do not want to repeat what others (including my 
earlier testimony) have said.
    The point I want to emphasize is that my (and others') judgment on 
the value of ACUS have only strengthened with the passing of time. It 
is often said that you do not appreciate what you have until you no 
longer have it. That, I believe, sums up the past decade for those of 
us who work in the field of administrative law.
    After ACUS closed and while I was still in government, there were 
several occasions when I and other senior government policy officials 
would have greatly benefited from having ACUS opine on pending 
developments--from how to conduct rulemaking proceedings in an 
electronic age to how to implement a new program in the most efficient, 
effective and equitable way. We knew from past experience that the 
ideas being considered, while meritorious, might well be improved as 
the result of an objective, non-partisan appraisal/critique. I cannot 
imagine that those in the current Administration would have any 
different view. In fact, at a conference held recently at American 
University on electronic rulemaking, several participants in the 
session on ``next steps'' (some with government experience and others 
currently in government) called for resurrecting ACUS to provide the 
kind of broad-based public and private input that is essential for good 
decision making in this area.
    There are two aspects of ACUS that I think are sorely missing. 
First, on matters of substance, ACUS provided an invaluable 
institutional memory. Invariably, administrations change, and with each 
new administration there are some bright new ideas about how to conduct 
or carry out administrative processes. Some of these ideas are fresh 
and productive and welcome. Some, however, may sound good or appear 
simple at first look, but they have in fact been tried before and 
failed or been seriously flawed for one reason or another. What ACUS 
provided was a forum for those who worked and wrote in the field to 
discuss, evaluate, and provide constructive suggestions based on real 
life experience. Now when senior government officials are presented 
with a proposal to address or resolve a particular problem in 
administrative practice, they can--and presumably do--seek out the 
views of some in the academy, individual private practitioners, or 
their colleagues in other federal agencies (if they know or can find 
out that these officials have dealt with this or a similar issue). But 
there is no central repository of expertise and experience that can 
provide a collective view--incorporating the considered judgment of 
those in the public and private sectors, those in academics and those 
in public administration, and importantly, both Democrats and 
Republicans. That was the beauty, or genius, of ACUS--for its very 
small staff was able to reach out to almost 100 of the most 
knowledgeable and experienced people in the field and tap the 
accumulated wisdom of the profession for the public good. The absence 
of ACUS is a tremendous loss to good government.
    The second aspect follows from a point made above. As I said, the 
members of ACUS came from, and brought with them, varied perspectives. 
This diversity of views was enhanced by the long-standing and time-
honored tradition of appointing the public members--those from the 
private sector--across party and philosophical lines. And the bi-
partisan and collegial nature of ACUS was maintained not only in the 
selection of members, but also in the operating committees and the 
plenary sessions. Simply stated, ACUS was one place where Democrats and 
Republicans worked together. We might have disagreed (strenuously) on 
the substance of the proposal--should there be a government program in 
this area or not--but if, in the wisdom of Congress, there was to be 
such a program, we could all agree that it should be conducted fairly 
and efficiently. It is significant, I believe, that both Justices 
Scalia and Breyer testified in favor of reauthorizing ACUS. Today, 
Boyden Gray and I both speak as stalwart supporters of ACUS. With 
divided government and the increased partisanship that has 
characterized the last several decades in Washington, there are very 
few such bi-partisan institutions--I should probably say non-partisan 
institutions--where people with vastly different political views can 
and do see eye to eye on administrative processes. That too was the 
beauty, or genius, of ACUS--for those with differing positions to be 
heard and be reconciled for the public good, and that too has been 
sorely missed.
    I thank this Subcommittee for reexamining this issue and for 
favorably considering the reauthorization of ACUS.

                              ATTACHMENTS


































    Mr. Cannon. I would now like to introduce our witnesses for 
today's hearing.
    Our first witness is C. Boyden Gray. Mr. Gray is a partner 
in the newly reconstituted firm of Wilmer Cutler Pickering Hale 
and Dorr. His practice focuses on a broad range of regulatory 
issues with emphasis on environmental matters, including those 
related to biotechnology, clean air, trade and the management 
of risk.
    Mr. Gray received his undergraduate degree from Harvard 
University and his law degree from the University of North 
Carolina. After serving as a law clerk for Chief Justice Earl 
Warren of the United States Supreme Court, Mr. Gray joined the 
predecessor of his current law firm. In 1981, he served as 
Legal Counsel for Vice President George Bush. He also served as 
Counsel for the Presidential Task Force on Regulatory Relief. 
Thereafter, Mr. Gray was Counsel to President Bush from 1989 to 
1993. Mr. Gray appears today on behalf of the American Bar 
Association.
    Joining Mr. Gray is Professor Gary Edles. Professor Edles 
is a Fellow in Administrative Law at American University 
Washington College of Law. He is also a visiting professor at 
the University of Hull Law School in England. In addition to an 
extensive academic career, Professor Edles has had a wide-
ranging legal career as a senior civil servant, specializing in 
Government regulation and the administrative process. Of 
particular interest, he served as General Counsel of ACUS from 
1987 to 1995.
    Professor Edles received his law degree from New York 
University and his Master of Laws and Doctor of Juridical 
Sciences Degrees from George Washington University Law School.
    Our next witness is Professor Sallyanne Payton. Professor 
Payton teaches at the University of Michigan Law School. During 
her professional career she has worked in the public and 
private sectors. In the 1970's, for example, she was a Staff 
Assistant to the President for the White House Domestic 
Council. She later became Chief Counsel for the Urban Mass 
Transportation Administration of the U.S. Department of 
Transportation. Over the course of nearly 20 years, Professor 
Payton served as either a Public Member or Senior Fellow at 
ACUS.
    Professor Payton received both her undergraduate and law 
degrees from Stanford University. She appears today on behalf 
of the Executive Organization and Management Standing Panel of 
the National Academy of Public Administration.
    Our final witness is Professor Philip Harter. I understand 
that you interrupted your vacation in Vermont to attend today's 
hearing, for which you are to be commended. We thank you. 
Professor Harter is the Earl F. Nelson Professor of Law At the 
Center for the Study of Dispute Resolution at the University of 
Missouri-Columbia School of Law. Over the course of his 35-year 
career in academia and the private sector, Professor Harter 
worked closely with ACUS in various capacities. While the 
Conference's senior staff attorney, he created a program on 
regulatory reform. As a consultant to ACUS, he developed the 
concept of negotiated rulemaking and authored a series of 
articles on the use of dispute resolution techniques by the 
Federal Government.
    Professor Harter received his undergraduate degree from 
Kenyon College and his law degree from the University of 
Michigan.
    I extend to each of you my warm regards and appreciation 
for your willingness to participate in today's hearing. In 
light of the fact that your written statements will be included 
in the hearing record, I would request that you limit your oral 
remarks to 5 minutes accordingly. Please feel free to summarize 
and highlight the salient points of your testimony.
    You will note that we have a lighting system before you 
that starts with a green light. After 4 minutes it turns to a 
yellow light and then 5 minutes it turns to a red light. My 
habit is to tap the gavel at 5 minutes. We would appreciate if 
you finish up your thoughts within more or less that time 
frame. We don't like to cut people off in their thinking and so 
we are not strict on this point, but it works better 
especially--well, I am not sure how many people we have here to 
question but I have some questions of the witnesses. We will go 
through those and you will have an opportunity to flesh out 
your thinking thereafter. After the witnesses have presented 
their remarks, the Subcommittee Members in the order of the 
time of their arrival will be permitted to ask questions of the 
witnesses, also subject to the 5-minute rule.
    That said, Mr. Gray, would you precede with your testimony?

STATEMENT OF C. BOYDEN GRAY, ESQ., WILMER CUTLER PICKERING HALE 
    AND DORR LLP, ON BEHALF OF THE AMERICAN BAR ASSOCIATION

    Mr. Gray. Mr. Chairman, thank you very much for inviting us 
and inviting me, and I testified before, I think, this very 
same Subcommittee a couple of years ago against the termination 
of ACUS. So I am very honored to be back to help support its 
reauthorization.
    I just want to make a couple of observations in addition to 
what my prepared text says, which is the official position of 
the ABA. The U.S. administrative law system I believe is the 
best in the world. It is the most transparent, the fairest and 
the most economically productive, especially when you look at 
it in comparison to the emerging EU, European Union, system, 
which is far more bureaucratic, biased against innovation, 
opaque, and encouraging support for incumbents rather than for 
a level playing field and equal opportunity for all 
competitors. I think ACUS deserves some of the credit for this 
state of affairs.
    The Administrative Procedure Act is unrecognizable in the 
sense of its original language. It has been largely rewritten, 
not in derogation of the congressional intent, but to flesh out 
what the words mean, ACUS was an important part of this 
evolving growth and we have a very, very sophisticated 
administrative system as a result. There are now, I think, some 
strains in the system.
    OIRA, the nerve center at OMB, the Office of Information 
and Regulatory Affairs, often provoked a polarized political 
response notwithstanding the fact that I believe Dr. Graham has 
done a great job, especially with his innovations of the so-
called prompt letter, which is a guide to agencies to do 
something if to do so would produce a result where its benefits 
greatly exceed cost. He has been very, very evenhanded in his 
administration of that office, I believe, but it would be an 
enormous help, I think, to the Government as a whole, if he 
could have a forum for ventilation of arguments for and against 
his administration of that office.
    There are some other issues that have come up during his 
tenure, issues involving data quality and related issues 
involving peer review. I think that these three issues would be 
very useful subjects of study by ACUS if it were to be 
reauthorized. And I would add to this that the notion of 
looking at the European Union and comparative study of its 
procedures. The Administrative Law Section of the ABA has 
embarked now on such a study. I am not sure it wouldn't be 
better if this study could be picked up by a neutral, obviously 
neutral Government entity, rather than have the private sector 
do it with questions about where the funding came from and what 
the funding influence is. I am not sure this transfer could be 
made, but to do a comparison I think is something that 
hopefully ACUS would be in a position, if it were reauthorized, 
to do.
    Many of the problems that--and they are not serious 
problems, but they are serious enough to warrant the 
reauthorization of this entity. Many of the problems result, if 
you step back, from a lack of dialogue and nonpartisanship or 
bipartisanship which has characterized the development of the 
administrative system in this country. We need to reinject some 
bipartisanship into the administrative process. That was the 
genius of ACUS.
    You asked how it should be reauthorized, the form. I am not 
sure I understand exactly the question, but I am not sure I 
would make it any different than it was before. There was a 
town hall air to much of what it did, a little boisterous, a 
little out of hand sometimes, people shouting at each other, 
but it was all in an effort to maintain a dialogue in the 
public meetings, and it was enormously successful. I should 
point out that the history of substantive administrative law 
has been one of bipartisanship, often forgotten.
    We perhaps think today, and we shouldn't do this but we 
probably do, of deregulation as a Republican idea to be opposed 
by Democrats, something that Reagan started, to be frustrated 
by Democratic Presidents. This is, I think, an erroneous view. 
The major deregulation that we have was started really by 
Senator Kennedy and then Professor Breyer, doing transportation 
deregulation. It was picked up and carried by President Carter 
with Stu Eisenstat taking the lead as Domestic Policy Adviser. 
Then of course it was picked up by Reagan in a more intensive 
way. But there is a direct line of antecedence going all the 
way back, actually to President Nixon, I think, and it is 
shared by all Democratic Presidents, and I think it would be a 
mistake to lose this sense of shared bipartisanship which has 
made our system the envy of the world. And I do think that ACUS 
would be very critical to getting us back to where we were some 
years ago.
    Thank you, Mr. Chairman.
    [The prepared statement of Mr. Gray follows:]
                  Prepared Statement of C. Boyden Gray
    I am pleased to be asked to testify here on behalf of the 
Administrative Law and Regulatory Practice Section of the American Bar 
Association, and the ABA itself, on the question of the reauthorization 
of the Administrative Conference of the United States (``ACUS''). The 
views expressed in this testimony are similar to the letter previously 
sent to this Subcommittee by Professor William Funk, Chairman of the 
Administrative Law Section. I am myself a former member of the 
Conference, as well as a former Chair of the Administrative Law Section 
of the ABA, and I testified before this Committee on May 11, 1995 to 
oppose the termination of ACUS (testimony attached).
    As you know, the Administrative Conference was established in 1964 
as a permanent body to serve as the federal government's in-house 
advisor on, and coordinator of, administrative procedural reform. It 
enjoyed bipartisan support for over 25 years and advised all three 
branches of government before being terminated in 1996.
    Through the years, the Conference was a valuable resource providing 
information on the efficiency, adequacy and fairness of the 
administrative procedures used by administrative agencies in carrying 
out their programs. This was a continuing responsibility and a 
continuing need, a need that has not ceased to exist.
    The Conference's work in some cases resulted in bipartisan 
legislation to improve the administrative process. For example, both 
the Negotiated Rulemaking Act of 1990 and the Administrative Dispute 
Resolution Act were the product of the Conference's work, both in terms 
of the studies and reports that underlay the justification for these 
two laws and also in terms of the interested persons and agencies 
brought together to support the law.
    In other cases, the Conference's work made legislation unnecessary. 
For example, early studies indicated that the exemption from notice and 
comment in the original Administrative Procedure Act for rulemakings 
involving public property, grants, contracts, loans, and benefits was 
no longer necessary or desirable. As a result of the Conference's work, 
virtually every agency voluntarily subjected itself to notice-and-
comment rulemaking when dealing with these subjects, improving the 
transparency and acceptability of government rules without the need for 
legislative amendment.
    The hallmark of the Conference's work was its ability to provide 
expert and non-partisan advice to the three branches of government. 
Drawing on the large number of volunteer public members of the 
Conference, as well as representatives from a wide spectrum of 
agencies, the Conference fostered a conversation among all interested 
persons and agencies. Utilizing academics for empirical research, which 
was reviewed first by subject matter committees staffed by members of 
the Conference and then by the full Conference, the Conference was able 
to provide a factual predicate for improvements in the administrative 
process that were not identified as ideologically or partisan-based 
proposals.
    I stress the fact that over a quarter century the Administrative 
Conference of the United States maintained a reputation for non-
partisan, expert evaluation of administrative processes and 
recommendations for improvements to those processes. It had no power 
but the power to persuade, and no political constituency other than 
those interested in improving administrative government.
    Not only was the Conference a source of expert and nonpartisan 
advice, the Conference played an important facilitative role for 
agencies in implementing changes or carrying out recommendations. Thus, 
a number of statutes, including the Government in the Sunshine Act and 
the Equal Access to Justice Act, specified that the Conference work 
with agencies in adopting the agencies' initial regulations. More 
recently, the Conference worked tirelessly to help agencies understand 
and utilize the Negotiated Rulemaking Act and the Administrative 
Dispute Resolution Act. Today, adapting administrative processes to 
make best use of the Internet is a hot topic, but one for which there 
is no central organization to study different techniques, assess them, 
and then facilitate the implementation of those that are best.
    It is a testament to the Conference's unique position that today 
persons of such differing judicial philosophies as Justices Scalia and 
Breyer can rally behind the re-creation of the Conference. Nor is it 
hard to find many others from across the political spectrum who will 
similarly commend the re-creation of the Conference to your 
subcommittee. Past chairs of the Conference, such as Professors 
Marshall Breger and Robert Anthony and Judge Loren Smith from one side 
of the aisle, can join hands with lawyer Sally Katzen and 
administrative judge Thomasina Rogers on the other side.
    The Conference proved itself effective at promoting efficiency in 
government for over 25 years. The American Bar Association has long 
supported the Conference and the role it played in advancing 
administrative procedural reform. We urge you to support legislation 
that would reauthorize the Conference and provide it with funds that 
are sufficient to permit it to continue its important mission.
    You have asked for comments on the form in which the 
reauthorization should take place, and for the regulatory reform 
priorities a reauthorized Conference should examine. I see nothing 
obvious to change in the way the Conference worked before; sometimes it 
behaved like a town meeting, but that was, and hopefully will again be, 
part of its success as a non-partisan venue. As for items to study, we 
would suggest some empirical research on the innovation of the OMB 
``prompt'' letter, matters relating to data quality and peer review 
issues.
                               __________

                               ATTACHMENT



      
    Mr. Cannon. Thank you, Mr. Gray. You have packed an 
enormous amount of ideas into 5 minutes. I want to go back and 
explore some of those. Let me just point out here in 
conjunction with what Mr. Watt said and what I would also say. 
Some of the most important issues we have before us today are 
some of the things that we believe will make a difference, are 
absolutely not partisan and have been kept out of the partisan 
environment. They ought to be developed in a nonpartisan 
environment like ACUS so that we can work on some of those very 
important issues.
    Appreciate your testimony. Mr. Edles.

STATEMENT OF PROFESSOR GARY J. EDLES, FELLOW IN ADMINISTRATIVE 
LAW, AMERICAN UNIVERSITY WASHINGTON COLLEGE OF LAW AND GENERAL 
 COUNSEL, ADMINISTRATIVE CONFERENCE OF THE UNITED STATES (1987-
                             1995)

    Mr. Edles. Mr. Chairman and Members of the Subcommittee, I 
am truly delighted to be here this afternoon to participate in 
these hearings that I do hope will lead to the reauthorization 
and re-creation of the Administrative Conference. I served in 
both Republican and Democratic Administrations at ACUS, and I 
thoroughly endorse the thoughtful comments offered by Justice 
Scalia and Justice Breyer last month as to the need to 
reestablish ACUS at this point in time. But it is certainly 
reasonable to ask, it seems to me, why there is a need for ACUS 
nearly a decade after it was abolished.
    The simple answer I think is that new regulatory issues 
have arisen in the past decade so that the type of analytical 
work that ACUS once did again needs to be done, and there 
really isn't any other institution capable of taking on the 
task in quite the same way. So even if one believes that ACUS 
had to some extent completed its earlier mission by 1995, it is 
certainly time to start it up again. Other individuals or 
institutions, law professors, experts in public administration, 
bar associations have to some degree stepped into the vacuum 
that was created by ACUS's demise. But those individuals or 
groups rarely have the type of resources or the inclination to 
take on day in and day out the numerous and various issues that 
ACUS did, to see projects through from a recognition of the 
problem to its meticulous examination to the design of a 
solution and eventually its implementation.
    I should also add on a personal note that judging from the 
voice mails and e-mails that I get in my American University 
office from Government employees even to this day, there is 
obviously still a need for the type of institutional memory and 
expertise that ACUS once provided.
    I don't have the precise agenda for an ACUS of the 21st 
century, but I do know that much has changed in the 9 years 
since ACUS was abolished. The era of electronic communication 
and its role in Government decision making, for example, was 
just beginning in 1995, and it is now in full flower. Problems 
affecting immigration procedures are surely different today in 
light of our country's security needs occasioned by 9/11. There 
are certainly new questions concerning the organization of the 
Federal Government. What's the proper role for public-private 
partnerships, self-regulatory organizations, Government 
contractors for example? Are there problems of governmental 
organization or interagency coordination that impede our 
country's ability to compete in world markets. And, Mr. 
Chairman, you mentioned a number of items that I think would 
also warrant ACUS style analysis.
    I think that ACUS's historic structure, which was a mix of 
Government officials, leading academics, lawyers from the 
private and public interest bars, plus a range of non-lawyer 
experts such as public administrators, remains the best blend 
of talent to accomplish ACUS's mission. The key ingredient for 
any revitalization, though, is it must be a genuinely 
nonpartisan and independent institution that is both objective 
and impartial and seen as objective and impartial.
    ACUS's operation and budget were tiny in absolute terms 
when it comes to Government entities. It had 18 employees and 
$1.8 million budget when it was eliminated in 1995. Perhaps 
more important, it was extremely small relative to its mission. 
It was the only Federal agency with exclusive responsibility 
for improving administrative justice and Federal programs that 
at the time affected about $500 million in gross domestic 
product and involved agencies and departments that adjudicated 
more cases than the Federal courts. In fact, the money saved by 
both the Government and the private sector by ACUS's seminal 
work in alternative dispute resolution alone far exceeds its 
annual budget. Those are, I think, ACUS's real value for money.
    My prepared statement offered some modest organizational 
and technical suggestions regarding the revitalization of ACUS. 
But more important than any precise modifications that Congress 
might have, being desirable modifications over the past 9 
years, I believe that there has to be a political recognition 
that it is worth spending a tiny amount of taxpayers' money to 
obtain genuinely independent, nonpartisan, expert analysis of 
issues bearing on the governmental process with a view toward 
improving the fairness and efficiency of that process.
    As Justice Breyer pointed out last month, other countries 
with significant administrative systems--Britain, France, 
Australia, for example--have permanent oversight bodies. In 
fact, the Canadian Parliament, which abolished its advisory 
review body in 1992 during a period of retrenchment and budget 
cutting that was not terribly different from what went on in 
this country, quickly realized that it had made a mistake and 
reestablished its commission only 4 years later. Our citizens, 
it seems to me, Mr. Chairman, deserve no less.
    I want to applaud the work of this Committee and staff in 
holding these hearings, and I hope they will be the first step 
leading to the reauthorization and funding of the 
Administrative Conference. I will try as best I can to answer 
any questions that you may have.
    [The prepared statement of Mr. Edles follows:]
                  Prepared Statement of Gary J. Edles
    Mr. Chairman, members of the subcommittee. I want to applaud the 
subcommittee's decision to hold theses hearings and I hope that they 
will lead to the long-overdue reauthorization and funding of the 
Administrative Conference of the United States, or ACUS. I served as 
ACUS' General Counsel from 1987 to 1995, and urged its re-creation in a 
1998 law review article, The Continuing Need for an Administrative 
Conference, 50 Admin. L. Rev. 101 (1998). I thoroughly endorse the 
thoughtful comments offered at the subcommittee's hearing last month by 
Justices Scalia and Breyer, and the observations of the American Bar 
Association, setting out the reasons for--indeed, the need for--ACUS' 
re-establishment at this time.
               the need for an administrative conference
    I strongly believe there is a need for the reauthorization of an 
Administrative Conference and that ACUS is ``very good value for 
money.'' Despite the presence of a written Constitution and a 
government-wide procedural statute (the APA), the federal 
administrative process, by design and evolution, is characterized by a 
considerable degree of procedural flexibility and agency discretion. 
Given that flexibility and discretion, some form of independent 
oversight entity is needed to help ensure that the process is 
effective, accountable, and, perhaps most important, fair to our 
citizens. ACUS successfully played a key oversight role in the past and 
I believe such an institution is still needed.
    As a practical matter, there are no other entities that can play 
the unique role that ACUS played. The courts are ill suited to perform 
a meaningful role as supervisor of the details of agency operations. 
Very few agency actions, even those that significantly affect members 
of the public, turn into litigated cases, in part because they are not 
amenable to judicial remedy or the average citizen simply can't afford 
the cost of litigation. So, many agency procedures and practices don't 
find their way into the courts. And the best a court can do in any 
event is to correct a problem in the case before it. The courts are 
simply not set up to be pro-active in proposing systematic change.
    Likewise, Congress cannot be expected to oversee the minutiae of 
agency operations and procedures. Congressional oversight of 
administrative agencies has always been episodic. Congress, quite 
frankly, has many more fundamental issues on its plate. For example, 
Title II of Public Law 104-121, the Small Business Regulatory 
Enforcement Fairness Act of 1996, gave Congress an opportunity to 
review agency regulations before they became effective and enact 
legislation to prevent them from going into effect. But the provision 
is limited to rulemaking initiatives, which make up only a portion of 
overall agency activity. Moreover, agencies place several thousand 
regulatory actions in the Federal Register annually, but Congress has 
historically managed to enact only 150-200 bills each year. As a 
consequence, to my knowledge, Congress has used its rulemaking review 
power only once since the statute was enacted. Congess, in short, 
rarely involves itself in the type of procedural particulars that ACUS 
regularly examined.
    It is doubtful that centralized review by the President, or even 
his senior deputies, can effectively oversee the finer points of the 
regulatory process. Although presidential review is theoretically 
possible, my colleague, Professor Thomas Sargentich, has suggested 
several factors that necessarily limit the President's power as a 
practical matter: the multitude of issues flowing through agencies 
daily, the severely limited resources of executive oversight, and the 
variety of control relationships that exist in the administrative 
system.
    Nor can agencies be expected to devote their time and energy to 
critical self-examination. In an era when resources are scarce and must 
be channeled into accomplishing the numerous tasks assigned to them by 
Congress, agencies can devote very little time to reflection unless 
pressed to do so by outside political pressure.
    Individual scholars or ad hoc advisory groups can study agency 
practices and procedures to some degree. Indeed, the Section of 
Administrative Law and Regulatory Practice of the American Bar 
Association has done an excellent job of picking up some of the slack 
after ACUS was abolished. But the details of day-to-day administrative 
procedure are often arcane and typically agency-specific, so they 
rarely attract the attention of academic scholars, who prefer to devote 
their time and energy to doctrinal or policy issues that have a larger 
audience. Moreover, neither academic researchers nor ad hoc advisory 
groups have the time or incentive to pursue research or recommendations 
to the implementation phase, particularly where such phase can last a 
decade or more.
    A permanent, independent body such as ACUS also melds the expertise 
and perspectives of the government agencies, the private sector, 
including, importantly, the practicing bar, and members of the 
judiciary and the academic community. The participation of senior 
government officials--especially career civil servants--brings a unique 
form of expertise and experience. Agency officials are typically 
thoroughly familiar with the intimate workings of their own agencies. 
That expertise is essential to effective procedural reform. But agency 
officials can also have a stake in existing procedures that they 
administer or may even have created. And I have always found it 
surprising how unfamiliar agency officials often are with the 
experience of sister agencies. So sensible oversight requires the 
bringing together of expertise from numerous agencies across the 
government.
    The participation of non-government members is crucial. It helps 
ensure that recommendations reflect the problems and perspectives of 
those who must actually deal with government and have experienced the 
frustration of trying to work their way through the bureaucracy or 
perceive government procedures as unfair. Judges lend their 
perspectives as generalist experts in fair procedure and reviewers who 
examine administrative action when it is challenged in court. 
Participation by members of the academic community helps guarantee that 
studies are thorough and doctrinal elements are not ignored.
    Finally, a permanent institution allows a career staff to develop 
expertise in the areas of administrative law and government 
organization and process and devote time and resources to implementing 
recommendations. Judging from the number of telephone calls or e-mails 
I received at my American University office after ACUS was abolished, 
the need for some form of institutional memory is critical.
    Over 40 years ago, federal Court of Appeals Judge E. Barrett 
Prettyman, reporting on behalf of the temporary Administrative 
Conferences created by President Kennedy, summarized ACUS' value as 
follows:

        The heavy pressures of Government to discharge immediate 
        responsibilities may at times rob administrators of the time 
        needed for consideration of procedures. Imperfections in method 
        . . . may acquire the protective coloration of familiarity, and 
        the demands of the daily job may lessen the will to achieve 
        change.

        The committees of Congress, suitably concerned as they are with 
        matters of substantive policy, can only sporadically occupy 
        themselves with the details of methodological and 
        organizational problems. . . . Nor do we think that hope of 
        major accomplishment lies in occasional studies by groups 
        external to the Government. . . . The current need is for 
        continuous attention to somewhat technical problems, rather 
        than for public enlightenment concerning a few dark areas that 
        cry for dramatic reforms. A discontinuous commission . . . is 
        unlikely to have great impact upon the day-to-day functioning 
        of the Federal agencies. Letter from Judge E. Barrett Prettyman 
        to President John F. Kennedy (Dec. 17, 1962), Legislative 
        History of ACUS (on file, ACUS Collection, American University 
        Washington College of Law Library),

    Those reasons help explain why other countries with significant 
administrative systems have permanent oversight bodies. For example, 
Britain has its Council of Tribunals that continuously monitors the 
work of that country's numerous tribunals and makes recommendations for 
procedural improvement. Much like ACUS, its detailed work is its 
greatest strength. The Australian Administrative Review Council has 
responsibility for giving advice on the workings of the administrative 
review system in that country. Canada too has a Law Commission that 
advises its Parliament on how to improve and modernize Canadian law. In 
fact, in 1992, a new Canadian government introduced a budget package 
designed to reduce both the federal budget and the deficit. It proposed 
abolition, privatization or consolidation of 46 separate agencies or 
programs. The Law Commission of Canada was one of the agencies 
abolished. The Commission was smaller than ACUS, but its jurisdiction 
was far broader, extending to ``the statutes and other laws comprising 
the laws of Canada.'' It employed the same general methodology as 
ACUS--systematic review and oversight of Canadian legal matters and the 
submission of recommendations for improvement to Parliament and the 
agencies and departments of government. The government quickly realized 
that abolishing the Commission had been ``penny-wise and pound 
foolish'' and the Canadian Parliament re-established the Commission, in 
a somewhat modified form, only 4 years later.
                         need for independence
    The need for a genuinely nonpartisan and independent advisory body 
has been recognized throughout ACUS' history. A Republican President, 
Dwight Eisenhower, established the first Administrative Conference on a 
temporary basis in 1953. A Democratic President, John Kennedy, created 
a second temporary Conference in 1961. Apart from their numerous 
proposals for specific improvements in agency procedures, both 
temporary groups strongly endorsed the need for a permanent 
institution. Congress agreed, and created what was designed to be a 
permanent institution in 1964 with passage of the Administrative 
Conference Act.
    A separate, independent institution serves to maintain both 
objectivity and the appearance of objectivity. From its earliest days, 
ACUS had a bylaw providing that each member participated ``according to 
his own views and not necessarily as a representative of any agency or 
other group or organization.'' It is doubtful, for example, that 
federal judges would have, or could have, participated in an 
institution that was not genuinely independent of an incumbent 
political administration. So ACUS would have lost the valuable insights 
of numerous federal judges, such as Justice Breyer, if it were seen as 
closely allied to the President, irrespective of which party was in 
power. Although the ACUS Chairman and staff were careful not to lock 
horns unnecessarily with an incumbent administration, ACUS' 
recommendations at times parted company with the official view of the 
President or particular departments or agencies of government. I think 
that committees of Congress especially appreciated that when ACUS 
provided its advice, it was not doing so simply as a spokesperson for a 
current administration.
    As part of its independence, Congress needs to ensure that ACUS has 
some funds for independent research. Over the years, ACUS affected 
major alterations in the federal administrative process. It recognized 
the need to develop fundamental changes in the process of the entire 
government. But it also examined the need for improvements in the 
organization and procedures of individual agencies. Its studies almost 
always focused on empirical inquiry, although they did not ignore 
doctrinal elements. During the period when I served as ACUS' General 
Counsel, from 1987 to 1995, agency-specific studies were conducted at 
the request of several agencies, often with the financial support of 
the requesting agency. Congress encouraged this approach in an effort 
to make ACUS more self-sustaining. Although ACUS was always receptive 
to conducting studies on behalf of agencies interested in self-
examination, a number of us were concerned about excessive reliance on 
funds from other agencies to sponsor projects. I would emphasize that 
no agency was ever able to influence ACUS' recommendations despite 
having requested or underwritten a study. Still, I believe that 
excessive reliance on agency funds can undermine public confidence in 
the objectivity of ACUS' research. Equally important, too much reliance 
on agency funding introduces instability in the research program 
because areas that need examination may not get it for lack of outside 
funding and a constant flow of funds from other agencies can never be 
assured. In my judgment, some independent research budget is essential.
             structure and mission for a reauthorized acus
    Any revitalized ACUS should remain essentially advisory. From time 
to time during ACUS' history, elements within ACUS or its supporters 
urged that it be given authority to compel, rather than merely 
recommend, action by agencies. In my view, that's a bad idea. Such 
expansion of its authority will compromise ACUS' ability to achieve 
actual reform. Much of its success stemmed from its ability to enlist 
an agency's support even when that agency was the subject of study. 
Numerous agencies actively solicited ACUS' help. And, in most cases, 
agencies adopted ACUS' recommendations. Any change from advisory to 
mandatory powers would alter ACUS' relationship with its member 
agencies from that of an impartial adviser to that of a policeman or 
potential adversary and compromise its ultimate ability to effect 
change. Nonetheless, I do believe that ACUS should undertake to bring 
to the attention of Congress or the President whether, and to what 
extent, its recommendations have been adopted. Providing Congress and 
the President with impartial advice, including a status report on 
agency implementation of ACUS recommendations, is not inconsistent with 
ACUS' advisory mission.
    Given the changing complexion of regulatory problems, and the 
recognized public dissatisfaction with government regulation, but the 
apparent lack of consensus on how to reform it, I think a revitalized 
ACUS should examine whether there are institutional elements that bear 
on regulatory failure. During my tenure, ACUS had economists among its 
members, such as OMB Director James Miller, and I think a revitalized 
ACUS would benefit from a membership that also included public 
administrators.
    A revived ACUS can be smaller than the 101-member Assembly. Such a 
large group provided broad representation of interests but, at times, 
frustrated efficient operation. As with any organization, not all 
members were equally active. Senior political officials from the 
government, in particular, often had schedule conflicts that 
compromised their participation. These scheduling conflicts also 
intermittently led to quorum problems. So the work typically fell to a 
smaller group of active members. As long as the balance between 
government and private interests is retained, and all cabinet 
departments and a fair representation of other agencies are included, 
fewer than 101 individuals could accomplish ACUS' statutory mission.
    Reform of entrenched administrative practices and attacking 
bureaucratic inertia takes time and perseverance. One of ACUS' 
strengths was its ability to see its ideas through from concept, to 
design, to implementation. So, in reauthorizing ACUS, Congress needs to 
ensure an ongoing role for a permanent, career staff.
    However, the permanent staff might be a bit smaller than the 24 
employees that made up the Office of the Chairman during the high water 
mark of ACUS' activities. While a small corps of permanent employees is 
essential, there is no reason why employees temporarily assigned from 
other agencies could not supplement the permanent staff. The existing 
statute permits this arrangement and, over the years, ACUS had an 
active ``visiting executive'' program that allowed a number of highly 
talented government employees to join the ACUS staff for temporary 
periods while remaining on their home agency's payroll. A new ACUS 
could also augment its operations without an additional outlay of funds 
through an affiliation with a law school or school of public 
administration, whose students and faculty could assist in, or 
supplement, the conduct of research, the coordination of peer review 
for oversight of projects, and the drafting and implementation of 
recommendations.
    ACUS' budget was tiny by governmental standards--only $1.8 million 
when it was eliminated in 1995. Even ACUS' critics acknowledged that 
its abolition had no meaningful effect on the overall federal budget. 
Perhaps more importantly, ACUS' budget was also small relative to its 
mission--it was the only agency with exclusive responsibility for 
improving administrative justice in federal programs that, at the time, 
affected about $500 billion of the gross domestic product and involved 
government departments and agencies that adjudicated more cases that 
the federal courts. Indeed, the amount of money saved by both the 
government and the private sector from ACUS' seminal work in the area 
of alternative dispute resolution, standing alone, far exceeded its 
annual budget. Given inflation since 1995, I think that ACUS could 
operate successfully at the outset on a modest budget in the $2-3 
million range.
    In summary, though, I think that the precise size and 
organizational structure of a new ACUS is much less significant than 
the political recognition that some entity needs to be available to 
police the inner recesses of the administrative process, and that ACUS 
is the best available option. It provides, as Justice Scalia pointed 
out, ``a unique combination of scholarship and practical know-how, of 
private-sector insights and career-government expertise.'' Its 
essential purpose today would be the same as when it was originally 
created--to identify the causes of government inefficiency, 
ineffectiveness, delay and unfairness, recommend ways to change things, 
and pursue those recommendations to fruition.
                        emoluments clause issue
    As part of the reauthorization process, I urge the committee to 
clarify the uncertainty that exists over a rather technical issue, 
namely the applicability of the Emoluments Clause of the U.S. 
Constitution to non-government members of ACUS. The uncertainty arises 
because of a 1993 opinion by the Office of Legal Counsel, Department of 
Justice (OLC), and ACUS' inability to have the matter resolved before 
it went out of business in 1995. Congress should make clear that, in 
its view, ACUS' members from outside the federal government who serve 
part-time, are unpaid for their services, and are explicitly required 
by the statute to be chosen for their expertise do not, simply because 
of such service, hold an ``Office of Profit or Trust'' within the 
meaning of the Emoluments Clause. Rather, they should be treated like 
members of any other federal advisory committee. Absent resolution of 
the issue by Congress, the status of ACUS' non-government members will 
remain in doubt and the ability of a revitalized ACUS to attract the 
most distinguished individuals from the private sector will be 
seriously compromised.
    As you may know, the Emoluments Clause provides that ``no Person 
holding any Office of Profit or Trust . . . shall, without the Consent 
of the Congress, accept . . . any present, Emolument, Office, or Title, 
of any kind whatever, from any King, Prince, or foreign State.'' U.S. 
Const., art. I Sec. 9 cl. 8. The Constitutional Convention included the 
Clause in order to shield foreign ministers and other officers of the 
United States government from undue influence and corruption by foreign 
governments. However, in a 1991 opinion, OLC substantially expanded the 
historic understanding of the Clause when it concluded that even 
``[f]ederal advisory committee members hold offices of profit or trust 
within the meaning of the Emoluments Clause.'' Applicability of 18 
U.S.C. Sec. 219 to Members of Federal Advisory Committees, 15 Op. 
O.L.C. 65 (1991). The 1991 opinion, although presumably affecting a 
thousand or more advisory committees at scores of federal agencies, 
went essentially unnoticed at the time.
    On October 28, 1993, OLC issued a further opinion addressing two 
rather esoteric Emoluments Clause questions specifically affecting ACUS 
members. First, it concluded that ACUS' academic members, such as law 
professors, are prohibited by the Emoluments Clause from serving on 
ACUS if, absent Congress' consent, they accept any payment from a 
commercial entity owned or controlled by a foreign government, 
including universities or law schools. That ruling had the effect of 
preventing any academic from serving as an ACUS member if he or she at 
any time undertook any employment relationship with a foreign 
government-owned academic institution--even a one-semester visiting 
professorship or a single compensated lecture. Second, OLC determined 
that an ``Emolument'' within the meaning of the Clause included any 
distribution of partnership shares that includes some proportionate 
share of the revenues generated from the firm's foreign government 
clients even though the ACUS members themselves did not personally 
represent any foreign clients and had no dealings with them. 
Applicability of the Emoluments Clause to Non-Government Members of 
ACUS, 17 Op. O.L.C. 114 (1993). What we discovered at the time was 
that, at most law firms, it is impossible to segregate partnership 
earnings to exclude from one partner's share some amount--often 
miniscule--associated with another partner's foreign government 
clients. So, absent Congress' consent, lawyers in large law firms whose 
partners had foreign clients could no longer serve on any advisory 
committee. Importantly, in reaching its decision, OLC did not 
reconsider its fundamental 1991 view that advisory committee members, 
such as non-government ACUS members, occupy an ``Office of . . . 
Trust'' within the meaning of the Emoluments Clause. Some of ACUS' 
members resigned in light of OLC's decision.
    The matter has been partially--but, unfortunately, not fully--
resolved in the years since 1993 because OLC has retreated from its 
original determination. Immediately on the heels of its October, 1993 
ACUS opinion, OLC, at the behest of the Department of State, 
reconsidered and revised its underlying view regarding the 
applicability of the Emoluments Clause to unpaid members of advisory 
committees. On March 1, 1994, in an unpublished letter to State 
Department Legal Adviser Conrad Harper from OLC Assistant Attorney 
General Walter Dellinger, subsequently cited in Applicability of 18 
U.S.C. Sec. 219 to Representative Members of Federal Advisory 
Committees, 1999 OLC LEXIS 11 (1999), OLC determined that ``not every 
member of an advisory committee necessarily occupies an `Office of 
Profit or Trust' under the [Emoluments] Clause.'' Later in 1994, OLC 
modified its view regarding advisory committee members from the 
academic community. It determined that while foreign public 
institutions, such as universities, were presumptively 
instrumentalities of a foreign state for Emoluments Clause purposes, 
individuals did not come within the Emoluments Clause if the foreign 
academic institutions with which they had a relationship are 
independent of the foreign government when making employment decisions. 
See Applicability of Emoluments Clause to Employment of Government 
Employees by Foreign Public Universities, 18 Op. O.L.C. 13 (1994). In 
1996, OLC publicly rejected what it now characterized as its previous 
``sweeping and unqualified view'' that federal advisory committee 
members hold offices of profit or trust and were thereby subject to the 
Emoluments Clause. It went on to conclude that members of the State 
Department's Advisory Committee on International Economic Policy do not 
occupy an ``Office of Profit or Trust'' within the meaning of the 
Emoluments Clause. See Letter Opinion for the Deputy Legal Advisor, 
Department of State, The Advisory Committee on International Economic 
Policy, 1996 OLC LEXIS 63 (1996).
    Unfortunately, the 1994 unpublished letter to Conrad Harper at the 
Department of State has not, to my knowledge at least, been made 
public. When I learned of its existence, long after ACUS had been 
abolished, I requested from OLC and the Department of State both a copy 
of the letter and any underlying documents from the State Department to 
OLC that might help illuminate OLC's new rationale. Because I was now a 
member of the academic community, I had to make my request pursuant to 
the Freedom of Information Act. My FOIA requests were denied by both 
agencies. So the bases for OLC's 1994 change of heart, and the factors 
that influenced it, are, as best I can tell, still not publicly known.
    OLC did issue a brief, two paragraph, published opinion on the 
subject in 1996. However, in that opinion OLC simply pointed to various 
factors that took members of the State Department's Advisory Committee 
on International Economic Policy out from under the Emoluments Clause. 
OLC pointed out that the members of that advisory committee met only 
occasionally, served without compensation, took no oath, and did not 
have access to classified information. OLC further indicated that the 
State Department committee was purely advisory, was not a creature of 
statute, and discharged no substantive statutory responsibilities. 
Beyond noting these factors, however, OLC failed to set out in any 
principled way which of these seemingly key characteristics, or 
combination of them, would render other advisory committee members 
subject to, or not subject to, the Emoluments Clause. For example, is 
the mere fact that Congress created the advisory committee by statute 
sufficient, by itself, to render advisory committee members subject to 
the Clause? If so, why is that so, and are the other factors thus 
either irrelevant or surplusage insofar as OLC's analysis is concerned? 
In the circumstances, OLC's view on the applicability of the Emoluments 
Clause to prospective ACUS members cannot be determined. Nonetheless, 
if rigidly or individually applied, the fact that the Conference is 
created by statute, that the membership as a whole is technically 
responsible for the Conference's activities, and that, through its 
Chairman and permanent career staff, it performs statutory duties other 
than making recommendations, could be seen to subject the non-
government members to the Emoluments Clause. So Congress needs to 
declare its intent that ACUS' non-government members be treated in the 
same way as members of other advisory committees and indicate that it 
is aware of the OLC opinion but does not believe that the Emoluments 
Clause should be a barrier to service by ACUS' academic members or 
individuals in large law firms as long as the non-government members do 
not, themselves, represent foreign governments. This is plainly within 
Congress' constitutional capacity to do.
    I would point out that, apart from ACUS' statutory creation, none 
of the other factors noted as relevant in OLC's 1996 opinion apply to 
non-government ACUS members. Non-government members meet only 
occasionally, serve without compensation, do not have access to 
classified information, and are not required to take an oath. They 
perform purely an advisory role akin to that performed by advisory 
committee members throughout government. The job of the Assembly of the 
Conference, made up of its entire membership, is to study issues of 
administrative procedure and adopt recommendations for improvement. See 
5 U.S.C. Sec. 595(a), setting out the Assembly's statutory 
responsibilities. Although the Assembly technically ``has ultimate 
authority over all activities of the Conference,'' its functions are 
necessarily confined by the specific administrative and executive 
powers conferred expressly on the Chairman and the Council in 5 U.S.C. 
Sec. 595(b) and (c). And, as a practical matter, during my term of 
office at least, the Assembly and its non-government members (apart 
from the 5 non-government members of the Council) did not perform any 
functions that were not related to their advisory responsibilities. In 
short, the Assembly, meeting twice a year in Plenary Session, and 
through its committees on an irregular basis at other times, was 
entirely a recommending or advisory body.
    ACUS' statutory footing or its other statutory responsibilities do 
not alter the advisory role of its non-government members. Although 
ACUS is both a statutorily created federal agency and an advisory 
committee, its non-government members participate only in its advisory 
functions. The statute created the position of Conference Chairman as 
its chief executive. He or she is a full-time federal employee who, 
along with the professional staff, conducts ACUS' day-to-day 
activities. The Chairman and staff ensure implementation of ACUS 
recommendations and the accomplishment of any statutory assignments 
given to ACUS by Congress. They serve as a clearinghouse for government 
agencies on administrative process issues. In other words, to the 
extent that ACUS as an agency performs tasks that might be considered 
to be non-advisory, these tasks fall within the purview of the Chairman 
and staff, who, as federal officials, are clearly subject to the 
Emoluments Clause.
    ACUS' 40-year history testifies to the fact that Congress has 
always known about--and, indeed, has endorsed and statutorily 
required--the appointment of distinguished law professors, lawyers in 
private practice, and other experts as non-government members. There 
were two temporary Conferences, neither of which was established by 
statute--the first created by President Eisenhower in 1953, the second 
established by President Kennedy in 1961. They were made up of law 
professors, lawyers in private practice, and other experts, with a 
federal judge as chairman. Those Temporary Conferences were explicitly 
the model for the statutorily established Conference created by 
Congress in the Administrative Conference Act of 1964, P.L. 88-499. 
Indeed, in section 593(b)(6) of Title 5 Congress expressly required 
that non-government members shall be chosen to ``provide broad 
representation of the views of private citizens and utilize diverse 
experience. The members shall be members of the practicing bar, 
scholars in the field of administrative law or government, or others 
specially informed by knowledge and experience with respect to Federal 
administrative procedure.'' Establishment of ACUS by statute worked no 
change in the basic advisory role of its non-government members. An 
Administrative Conference rooted in a statute, as recommended by both 
temporary Conferences, was intended solely to give the advisory body 
permanent status. In my opinion, if anything, ACUS' statutory 
underpinning, and Congress' express articulation of membership 
qualifications, manifests de facto congressional consent to any 
Emoluments Clause issue that a statutory foundation, standing alone, 
might be seen to pose.
    But I recognize that the 1993 OLC opinion will complicate and 
compromise ACUS' ability to attract the most distinguished individuals 
from the private sector. So Congress should eliminate any ambiguity by 
amending the statute as part of the reauthorization process. There is 
no drawback in doing so. The Assembly, and its committees, have always 
operated, and must continue to operate, pursuant to the openness 
requirements of the Federal Advisory Committee Act, 5 U.S.C. Appendix, 
as do other federal advisory committees. Non-government members must 
comply with pertinent Office of Government Ethics disclosure 
requirements. So I recommend that Congress make two statutory 
modifications. First, it should delete the second sentence of section 
595 that confers on the Assembly ``ultimate authority over all 
activities of the Conference.'' This will eliminate any technical 
argument that the Assembly plays a role in the administrative operation 
of the agency. Second, it should add a final sentence to section 593(c) 
to provide explicitly that ``Members of the Conference from outside the 
Federal Government do not, by virtue of their appointment, hold an 
``Office of Profit or Trust'' within the meaning of Article I, Sec. 9, 
cl. 8 of the U.S. Constitution.'' At a minimum, Congress should make 
clear in the legislative history that, in reauthorizing ACUS, it fully 
anticipates, and consents to, membership by individuals who are members 
of the practicing Bar, scholars in the field of administrative law or 
government, or other experts in federal administrative procedure 
irrespective of any highly attenuated relationship with a foreign 
entity of the type OLC found to implicate the Emoluments Clause.
    I appreciate the opportunity to participate in the subcommittee's 
hearings and I sincerely hope that they are the beginning of a process 
that leads to the reauthorization, re-creation, and funding of the 
Administrative Conference.

    Mr. Cannon. Thank you, Professor.
    Ms. Payton, would you--we have only one microphone but it 
works, which is nice.

   STATEMENT OF PROFESSOR SALLYANNE PAYTON, WILLIAM W. COOK 
  PROFESSOR OF LAW, THE UNIVERSITY OF MICHIGAN LAW SCHOOL, ON 
      BEHALF OF NATIONAL ACADEMY OF PUBLIC ADMINISTRATION

    Ms. Payton. I will try not to say anything too startling.
    Mr. Chairman, Members of the Committee, thank you for 
inviting me to testify on the reauthorization of the 
Administrative Conference of the United States. I am the Cook 
Professor of Law at the University of Michigan Law School. As 
you know, I served on the Administrative Conference 
continuously for five presidential administrations. I am a past 
Chair of the Administrative Law Section of the American 
Association of Law Schools, and since 1998 I have been a Fellow 
of the National Academy of Public Administration and a member 
of the Standing Panel on Executive Organization and Management, 
which I will refer to as EOM panel.
    I currently serve as the Director of the Academy. The 
Academy itself does not take positions on pending legislation. 
That function is located in the standing panels, such as the 
EOM panel, and I am here on behalf of the EOM panel. I am 
expressing today the management view, if you will, of the 
Administrative Conference. I have coordinated my testimony with 
Sally Katzen, who has contributed a statement for the record, 
and I concur in her views. Since she cannot be here in person 
today she has authorized me to speak to any questions regarding 
her statement.
    My testimony reflects also the strong views of the EOM 
panel, which recently met and after deliberation voted to 
express its strong support of restoring the Administrative 
Conference. The EOM panel includes many present and former 
senior managers of the Government. I must say that this is the 
first time I have ever known my colleagues on the EOM panel to 
express enthusiasm for lawyers, and so the position of the 
panel should be taken as a measure of this wide esteem in which 
ACUS is held.
    You have my written statement. In these oral remarks the 
principal point I want to make is that good administrative 
process and procedure are part of the critical infrastructure 
of Government. Like other infrastructure, they are likely to be 
taken for granted and neglected until problems build into 
crises or something major goes wrong. In the Government of the 
United States, only ACUS ever had the mission of engaging in 
constant correction and improvement of the procedure and 
process infrastructure.
    ACUS was what we call a community of practice. It was a 
community of practice of administrative law professionals. Its 
members spanned all the agencies, administrations and different 
political parties. It included both academicians and 
practitioners which fused public and private. ACUS was led from 
the top. The roster of its public members and consultants was a 
virtual Who's Who of administrative law.
    Moreover, these luminaries worked hard. ACUS projects for 
the most part were difficult, technical and esoteric, some 
would say boring, the ordinary work of tending after the 
administrative process.
    Now many of the lawyers who are supporting restoration of 
ACUS have spoken warmly of the bipartisan and collegiality of 
the Conference. From a management perspective, the 
attractiveness of ACUS to the professional community meant that 
prominent and distinguished people were willing for the sake of 
that collegiality to focus on operational issues that would 
otherwise never have claimed their attention. The Government 
benefited enormously by assembling and hosting ACUS. It 
stimulated the members of the Conference to do the work of the 
Government.
    Now, I don't mean that ACUS was perfect, only that it was, 
as we now know, irreplaceable. The EOM panel therefore 
encourages restoring it with its virtues intact.
    Now, our analysis of the relationship between ACUS's 
structure and performance leads us to urge caution with respect 
to changing in any significant respect its role and 
responsibilities. We recognize that the world has changed since 
1994 and so have the concerns of administrative lawyers, as 
Professor Edles just pointed out. We have moved off the old 
agenda on to a new agenda, but it is still the agenda of 
administrative law. We believe that the task of deciding how to 
retain the old virtues of ACUS, while meeting new challenges, 
can safely and appropriately be entrusted to the administrative 
law community, itself operating under its original and quite 
flexible ACUS charter.
    The EOM panel therefore supports restoration of ACUS under 
its original charter. I thank the Subcommittee for reexamining 
this issue. You are doing a great service.
    [The prepared statement of Ms. Payton follows:]
                 Prepared Statement of Sallyanne Payton
    Mr. Chairman and Members of the Subcommittee:
    I greatly appreciate your invitation to testify in favor of the 
reauthorization of the Administrative Conference of the United States, 
known as ACUS or ``the Conference.'' I am the William W. Cook Professor 
of Law at the University of Michigan Law School. I served on the 
Conference continuously through five presidential administrations as a 
Public Member and then a Senior Fellow, beginning in 1978 and ending in 
1995 when the Conference was disbanded. In 2001-2002 I was Chair of the 
American Association of Law Schools Section on Administrative Law. 
Since 1998 I have been a Fellow of the National Academy of Public 
Administration and a member of its Standing Panel on Executive 
Organization and Management (EOM Standing Panel). I currently serve as 
a Director of the Academy.
    My testimony today has been coordinated with that of Sally Katzen, 
and I concur in her views. Since she cannot be here in person today she 
has authorized me to speak to any questions regarding her testimony. My 
testimony also reflects the views of the EOM Standing Panel, which 
recently met and deliberated on the question of restoring the 
Administrative Conference. The panel voted to express its strong view 
in support of reauthorization. I will focus these remarks on the 
reasons for this solid endorsement.
    One of the challenges of managing a government as diverse in 
mission and organization as is the Government of the United States is 
to locate responsibility for common functions where they can be 
performed most effectively at the appropriate scale. Administrative 
processes and procedures are ubiquitous in government, but being 
matters of technique rather than substance they tend to claim a smaller 
share of the attention of agencies and the Congress than do more 
concrete and pressing concerns.\1\ They are not for that reason 
unimportant. It is through administrative processes and procedures that 
most people interact with government. These processes and procedures 
are part of the essential infrastructure of government, and continuous 
attention must be paid to them. The ability of government to conduct 
itself appropriately, and to monitor and improve its procedures and 
processes, is therefore a critical piece of organizational competence. 
It is true that the judiciary has power to review agency action at the 
behest of an appropriate party with a legally-protected interest, but 
judicial review is available for only the thinnest sliver of the work 
of government, and in any event the mission of the courts is to decide 
disputes and to focus on larger-scale institutional relationships, not 
to improve administrative systems.
---------------------------------------------------------------------------
    \1\ This observation was a principal motivation for the creation of 
ACUS as a permanent body. Here is what Judge E. Barrett Prettyman wrote 
to President Kennedy after having led two committees studying the 
possibility of creating the Conference:

      The heavy pressures on Government to discharge immediate 
      responsibilities may at times rob administrators of the 
      time needed for consideration of procedures. Imperfections 
      in method . . . may acquire the protective coloration of 
      familiarity; and the demands of the daily job may lessen 
      the will to achieve change. . . . The committees of 
      Congress, suitably concerned as they are with matters of 
      substantive policy, can only sporadically occupy themselves 
      with the details of methodological and organizational 
      problems . . . Nor do we think that hope of major 
      accomplishment lies in occasional studies by groups 
      external to the Government. . . . The current need is for 
      continuous attention to somewhat technical problems, rather 
      than for public enlightenment concerning a few dark areas 
      that cry for dramatic reforms. A discontinuous commission . 
      . . is unlikely to have great impact upon the day-to-day 
      functioning of the Federal agencies. Letter from Judge E. 
      Barrett Prettyman to President John F. Kennedy (Dec. 17, 
      1962) (urging establishment of permanent Administrative 
      Conference) (on file with ACUS), cited in Testimony of 
      Sally Katzen before the House Committee on the Judiciary 
      Subcommittee on Administrative Law and Governmental 
      Relations in Support of the Reauthorization of the 
      Administrative Conference of the United States, April 21, 
      1994, reprinted in 8 ADMIN. L.J. AM. U. 649, 653 (1994) 
      (emphasis supplied).
    There is thus a void, which the Administrative Conference was 
created to fill. The Conference was a remarkable institution. In the 
current argot of organizational theory, it would be called a 
``community of practice.'' In her 1994 testimony in support of the 
reauthorization of ACUS, Sally Katzen described the Conference as it 
then existed:

        By statutory design, a majority of the Administrative 
        Conference's members represent government departments and 
        agencies. All major departments and agencies are represented 
        and each department or agency chooses its own representative. 
        The caliber of the individuals who represent these agencies 
        attests to the importance that the agencies, as well as the 
        Administration, assign to the Administrative Conference's 
        functions. . . . The government officials join forces with 
        distinguished private citizens, called ``public members''--law 
        professors, public interest lawyers, private practitioners, 
        economists, public administrators--who volunteer their time and 
        talent because they share the view that this unique public-
        private partnership significantly improves the way government 
        regulates its citizens or delivers services to them. The 
        Administrative Conference Act requires that the Administrative 
        Conference chairman select members from the private sector who 
        are ``members of the practicing bar, scholars in the field of 
        administrative law or government, or others specially informed 
        by knowledge and experience with respect to federal 
        administrative procedure.'' . . . The Administrative Conference 
        ha[d]s a long-standing tradition of private sector membership 
        that crosses party and philosophical lines . . .\2\
---------------------------------------------------------------------------
    \2\ Id. at 652.

    I am sure that all of the witnesses before this Committee who have 
been on the private side of this public-private partnership would 
attest that serving as a Public Member of the Conference was 
challenging, the work being frequently complicated, esoteric and 
technical. Nonetheless, Public Members of startlingly distinguished 
professional standing viewed participation in the Conference as a high 
calling and worked their way devotedly, largely at their own personal 
expense, through procedural and process issues of which no notice was 
likely to be taken outside of the circle of administrative lawyers, and 
for which they would receive no credit.
    This willingness on the part of the leaders of the administrative 
law community to contribute personally to the work of ACUS was an 
expression of their commitment to improving the important below-the-
radar processes that are critical to the well-being of those who have 
to depend on or do business with government. I think, for example, of 
the work that ACUS did on the process for designating ``representative 
payees'' for Social Security recipients who cannot care for themselves 
but who have not been declared legally incompetent.\3\ What was unique 
about the Conference was that highly-compensated lawyers, leading 
academicians who specialized in constitutional theory, and sitting 
federal judges who turned out to be future Supreme Court Justices, 
among others, believed that making sure that processes of this sort 
were tailored correctly was worth their time, because these processes 
mattered to the public.
---------------------------------------------------------------------------
    \3\ Administrative Conference of the United States, Recommendation 
91-3: The Social Security Representative Payee Program, 1991 ACUS 17.
---------------------------------------------------------------------------
    Even partisan competition was subordinated to the members' 
determination to achieve good administrative principle and practice. 
The Conference's bipartisanship was so pervasive that it functioned as 
nonpartisanship, in the tradition of ``good government.''
    Like any organized community of practice, the Conference maintained 
an informal institutional memory and a repository of useful information 
that was made available to those who sought its advice, whether or not 
they were located in the Executive Branch. It is worth remembering in 
this context that at any given time a substantial fraction of the 
people who have responsibility for designing, conducting or reforming 
administrative processes and procedures are new to their jobs, or have 
never had occasion to think about the type of issues confronting them. 
There are new Hill staffers and new independent agency commissioners, 
who need a source of trustworthy information and advice. Turnover among 
agency officials produces a constant inflow of people who need to be 
informed about their responsibilities. Best practices need to be 
identified and information about them disseminated. No individual 
agency is in a position to maintain a comprehensive information base on 
federal administrative process and procedure; nor can any 
administrative or other operating agency always take on the role of 
thinking conceptually about its own work in the context of general 
principles of administrative process. Responsibility for these 
functions must be centralized; it must be prestigious; and it must be 
impartial. The Conference was all of these things. Some of the greatest 
praise for ACUS has come from Members of Congress who had occasion to 
call on it for information and advice. Many members of the EOM Standing 
Panel have had similar experiences, and view ACUS as having been a 
highly useful organization.
    The case for restoring ACUS thus seems overwhelming to my 
colleagues on the EOM Standing Panel, because we have great respect for 
its unique--and, as we have observed during the years since its demise, 
irreplaceable--function. Much has changed during the past ten years, 
however, and we understand that among those who favor placing ACUS back 
in service there might be some sentiment for modifying its charter to 
give the organization a broader role and responsibility, and an 
instruction to take on matters of greater salience. On this point the 
members of the EOM Standing Panel were unable to agree among ourselves, 
and we urge the Committee to be cautious. It is not intrinsically 
difficult to attract high-level attention to high-visibility issues; it 
is much more difficult to attract high-level attention to low-
visibility issues. The genius of ACUS was that although its charter was 
(and still is) flexible enough to encompass virtually any subject that 
can plausibly be characterized as a matter of ``agency organization, 
procedure, or management'' \4\, as distinct from pure substance, its 
broadly representative structure drove it away from issues that might 
have provoked partisan strife and toward addressing a continuous stream 
of low-salience problems that were important to people who actually had 
to deal with the government. As we have learned during the years of its 
absence, if ACUS does not do this work, no one will. We urge the 
Committee to reauthorize ACUS using the existing language of its 
charter, to put ACUS back together as nearly as possible just as it 
was, and to allow ACUS to find its own way in its new environment.
---------------------------------------------------------------------------
    \4\ 5 U.S.C. Sec. 594 provides:

To carry out the purpose of this subchapter, the Administrative 
Conference of the United States may (1) study the efficiency, adequacy, 
and fairness of the administrative procedure used by administrative 
---------------------------------------------------------------------------
agencies in carrying out administrative programs. . . .

5 U.S.C. Sec. 592 (3) defines ``administrative procedure:''

``administrative procedure'' means procedure used in carrying out an 
administrative program and is to be broadly construed to include any 
aspect of agency organization, procedure, or management which may 
affect the equitable consideration of public and private interests, the 
fairness of agency decisions, the speed of agency action, and the 
relationship of operating methods to later judicial review, but does 
not include the scope of agency responsibility as established by law or 
matters of substantive policy committed by law to agency discretion.
    I thank the Subcommittee for reexamining this issue and for 
considering the restoration of the Administrative Conference.

    Mr. Cannon. Thank you. We appreciate your comments.
    Mr. Chabot. Mr. Chairman.
    Mr. Cannon. Yes.
    Mr. Chabot. If I could speak out of order for just a 
moment.
    Mr. Cannon. Absolutely. Do you have other commitments?
    Mr. Chabot. Yes, I have a hearing that I have to attend on 
Iran nuclear proliferation. I have heard the other three 
testify. Professor Harter, I have yours in my hand. I assure 
you I will read it this afternoon. So I apologize.
    Mr. Cannon. Thank you. More time for questions for us. 
Professor Harter.

    STATEMENT OF PROFESSOR PHILIP J. HARTER, EARL F. NELSON 
 PROFESSOR OF LAW, CENTER FOR THE STUDY OF DISPUTE RESOLUTION, 
               UNIVERSITY OF MISSOURI LAW SCHOOL

    Mr. Harter. Well, this is the part of the schizophrenia of 
this issue.
    Mr. Cannon. We would hope that the structure that we come 
up with for ACUS is simple and flexible enough to accommodate 
the problems that we have in daily life, like getting our light 
system to work.
    Mr. Harter. Let me begin by saying that after a--my title 
of Earl F. Nelson Professor of Law is very much of a newbie. I 
have spent 35 years here in Washington working with agencies, 
among them, and in that I have observed them in action, and I 
do want to point out that that is two words. And I am here to 
wholeheartedly support the resurrection of the Administrative 
Conference, and I want to do it really on two grounds. One is 
that I think that the reestablishment would not only save the 
Government significant sums of money. Clearly I think we need 
it as an investment, but also that it would enhance democratic 
or, if you want to be nonpartisan about it, civic republican 
values in America, of just how the people participate in the 
Government.
    You look back, since the APA was enacted in 1946, 
significant changes have taken place in the management 
structure of the Federal Government. There are new forms, major 
new forms of public-private interaction, reliance on the 
private sector with oversight by Government, new developments 
and relationships between Federal and State governments, new 
perceptions of how the Government should and should not 
function when making important decisions in relationship with 
individuals in the private sector. If you think about it, 
agencies in each individual agency, entity, each individual 
subagencies, hundreds of them, must confront each of those 
demands daily, each time they take action, and so similar 
choices must be made over and over and over again in 
Washington. Agencies lack the way of finding out what works and 
what doesn't work.
    Let me go over some specifics as to some of the needs. I 
was recently--gave a little pep talk to an agency on how 
negotiated rulemaking works and whatever, and a couple of 
representatives from other agencies heard that I was going to 
do it and asked if they could attend, and the answer was no. 
Bizarre. It was a lack of sharing experiences across agencies 
to support insights.
    One of the major provisions of the Administrative 
Resolution Act is its confidentiality provision. It was one of 
the leading early provisions. It had some ambiguity, some 
interpretation. How do you dovetail mandatory confidentiality 
at agencies with inspector generals, how various parts work.
    What do we have? Federal Government set up a committee to 
talk about guidance for confidentiality and dispute resolution 
proceedings. The American Bar Association set up a committee to 
talk about confidentiality in administrative dispute resolution 
proceedings. Now, even though these parties are going to be in 
the same proceeding, those two committees don't talk to each 
other. They come up with different advice. There is no way to 
share the insights or to come up with a common set of goals on 
how to implement. The communication has broken down.
    Second, if you go through and look at an awful lot of the 
recent legislation, that because there is no ACUS, Congress is 
ad hocking it. It will require agencies--well, go talk to the 
National Research Council. There is no continuity. There is no 
standing membership. There is no particular insight into the 
broad perception, so let's just go out and find out individual 
aspects.
    One that I found interesting was American University held a 
major conference on electronic rulemaking earlier in January. 
One of the major reasons given for expanding e-rulemaking, and 
certainly it has major aspects in e-data acquisition and 
management but another aspect is the accessibility of the 
American public, an ability to participate in rulemaking via 
the Internet. And I will tell you when they were talking about 
what they were going to do it just sent shivers down my spine. 
If implemented without care, it will just basically 
disenfranchise individuals because what they are talking about 
is establishing a dialogue for rulemaking, basically an ad hoc, 
negotiated rulemaking. What individual has the time to be 
there? Only the organized interests are going to be on the 
other end of that communication. It will be in fact ex parte 
communication in broad daylight.
    We broke down into work groups and in my work group that I 
chaired, and it was really a bizarre, you know, which turned 
out to be a broadly representative group--was strongly of the 
view that the Government needed to establish an advisory 
committee of public and private people to advise on public 
participation. After all, the whole name of it is how the 
private people participate in Government. Wouldn't it be nice 
if the Government asked the private people how it ought to 
work? And so based on that, I sent a petition, or a letter I 
guess actually, to three of the leaders of the e-rulemaking 
effort suggesting that an establishment of an advisory 
committee could be a good idea, to which I got a resounding 
nothing. Not an answer. I was told by somebody who was at the 
meeting that my answer said all they want to do is take a hold 
and take it away. It was some kind of pejorative answer. All of 
those issues would be addressed by an Administrative Conference 
wishing to have a dialogue among the parties, desperately.
    So what has happened is the private sector is talking to 
themselves, the Government is talking to themselves without 
bridging, and we have got to get over that. That is what we are 
talking about in the e-rulemaking--I mean in the EU process.
    I think as to the membership, I would--although I think 
that the statute is fine, I would urge a much broader 
membership of--I mean if you listen to the four of us the words 
``administrative law'' creep in a lot. It isn't just 
administrative law. It is administration. It is the 
Administrative Conference, not the Administrative Law 
Conference. I think you need experts in management. You need 
economists. You need public administrators. You need all levels 
of Government. You need political agencies, senior service, and 
you need the staff. After all, it is the staff that is going to 
implement all of that and I think the staff has been woefully 
underrepresented in the Conference.
    So I would hope that in its new incarnation that it be 
really broadly represented of diverse interests that would be 
affected by it.
    Lastly, the question of appropriations. I would admit to a 
mistake, an error in my prepared testimony that I sort of 
abstracted, which I think the current value of the original 
appropriation would be $10 million, and I was wrong as to what 
the original appropriation is. But I still think that is a good 
figure, because I think that you really do require resources to 
go out and do the sophisticated stuff, to answer a lot of the 
questions that have been raised by you and by the other 
panelists, and again I think that will be an investment well 
made. Iurge your action and I am excited that you are 
undertaking this.
    [The prepared statement of Mr. Harter follows:]
                 Prepared Statement of Philip J. Harter
    My name is Philip J. Harter. I am the Earl F. Nelson Professor of 
Law at the Center for the Study of Dispute Resolution at the University 
of Missouri--Columbia School of Law. I whole heartedly support the 
resurrection of the Administrative Conference: Its re-establishment 
would not only save the government significant sums of money, it would 
also enhance democratic--or, to be non-partisan about it, civic 
republican--government.
                       background and perspective
    I would like to provide a bit of my background since it forms the 
perspective for the observations that follow. To a very real extent, 
the Administrative Conference has determined the course of my 
professional life. Thirty five years ago right now I was a research 
assistant to Professor Roger Cramton at the University of Michigan Law 
School. The project we were working on ultimately became ACUS 
Recommendation 2, and Professor Cramton became Chair of ACUS. I later 
became Senior Staff Attorney at the Conference and developed a program 
on regulatory reform. After I entered private practice, I was 
subsequently a consultant to the ABA's Coordinating Committee on 
Regulatory Reform that played such a crucial role in the debates of the 
late 70s and early 80s. In the mid-90s I chaired that committee, and in 
that capacity I had the honor to work closely with this Committee.
    I have been a consultant to the Conference on several occasions. 
Probably most notably, I developed negotiated rulemaking as a 
consultant to ACUS and wrote a series of articles on the use of dispute 
resolution techniques by the Federal Government. Those articles 
resulted in the Negotiated Rulemaking Act and the Administrative 
Dispute Resolution Act. Through its recommendations, oversight, and 
consultations, the Conference played a pivotal role in improving the 
way government agencies make decisions affecting the public.
                      the desperate need for acus
    The processes government agencies use to make decisions are 
complex, difficult, and continually evolving. The flexible, scant 
procedures outlined in the Administrative Procedure Act have been 
supplemented by numerous Executive Orders, judicial decisions, and ad 
hoc statutory requirements. Moreover, since the APA was enacted in 1946 
significant changes have taken place in the management structure of the 
Federal government, and there are new forms of public-private 
interaction, new developments in the relationship between Federal and 
State governments, and new perceptions as to how the government should 
function when making important decisions. Officials in each agency must 
confront all of these demands each time they take action. As a result, 
similar choices must be made over and over again in the halls of 
Washington about how to make decisions.
    Oftentimes officials have little information as to how well a 
program implemented by another agency works or little guidance as to 
how the duties could be successfully discharged or major pitfalls 
avoided. Those who deal regularly with multiple agencies have witnessed 
the dire need for some means by which agencies can share insights and 
experiences and to gain expert advice as to the best ways to go about 
the public's business. Without it, agencies necessarily incur high 
transaction costs by repeatedly reinventing similar procedures; the 
lack also means the best ideas are not recognized, strengthened, and 
used more widely nor the worst improved or discarded.
    Further, advice would be helpful both to Congress and the agencies 
as to the potential structure of new ways to achieve public goals and 
to respond to public inquiries and criticisms about how individual 
agencies have functioned. And, Congress and the agencies alike could 
benefit from the insights and advice of those who are directly affected 
by the administrative process and from those who study it from a 
variety of perspectives.
    Since the demise of ACUS, we lack the means to refine how we do the 
public's business: no office or organization regularly convenes a 
broadly representative group of experts to deliberate about how to 
improve the quality of the administrative process. A permanent entity 
such as renewed ACUS is needed that can be devoted to solving the 
problems of excess costs, delays, and burdens that are imposed upon the 
agencies and upon the public by inadequate, inefficient, and 
duplicative government processes.
    Individual agencies, while they have the ability to review their 
own performance, lack the capacity to make cross-cutting agency reforms 
and comparisons. Furthermore, agencies acting alone cannot make the 
necessary procedural reforms for the improvement of administrative 
process as a whole. And, agencies usually do not have the incentive, 
will, or resources to conduct a thorough self-examination to see if 
they could do things better.
    A forum for collegial self-critique and development of effective 
administrative practices is eminently desirable. Moreover, one is 
needed that can bring a sense of unity to administrative agencies and 
promote an appropriate degree of uniformity in their procedures. 
Congress should, therefore, establish such an institution that will 
systematically seek to promote improvements in the administrative 
process: The Administrative Conference is just such an agency.
    The primary purpose of revitalized ACUS would be to care for the 
improvement of the administrative process. In doing so, it would 
examine government procedures and practices, with the goal being to 
search for new ways of helping governmental agencies function more 
fairly, efficiently, and effectively. The organization could play a 
leading role in the development of domestic administrative law 
doctrines. One of its foremost functions would be to review and 
evaluate whether the basic law governing administrative procedure, the 
Administrative Procedure Act (``APA''), as well as other procedural 
requirements should be revised and updated. It could also arrange for 
the interchange among administrative agencies of information 
potentially useful in improving administrative procedures. Another role 
it could discharge would be the preparation of resource documents, 
bibliographies, and advice and recommendations on various topics 
confronted by agencies. Although now aging, ACUS handbooks are on the 
desks of many of the leaders in the administrative process on both 
sides of the great public-private divide.
    The new ACUS could also focus on the more minute details of the 
administrative process as well. Specifically, it could study and adopt 
recommendations concerning better rule-making procedures, or ways to 
avoid legal technicalities, controversies, and delays through agency 
use of alternative means of dispute resolution. For example, the 
exploding use of the internet and other forms of electronic 
communication present wonderful opportunities for increasing the 
information available to our citizens and their participation in our 
affairs. But, tapping these resources and making sure they work 
effectively and efficiently is itself a daunting task. A recent 
conference on e-rulemaking held at American University pointed out many 
potential problems that could arise if the procedures used for e-
rulemaking were not carefully developed; the public at large could 
effectively be disenfranchised. Moreover, a strong recommendation was 
made that since much of the work on e-rulemaking is being done in the 
name of enhancing public participation, it would help if those in the 
government actually consulted with interested parties in the private 
sector. Yet, multiple requests to leaders of the e-rulemaking effort 
for the establishment of an advisory committee that could provide such 
advice and make recommendations to protect against abuse went 
unanswered. That experience alone points to the dire need for an 
oversight body.
    Another focus would be to collect information and statistics from 
administrative agencies and to publish reports that could be useful for 
evaluating and improving administrative procedure. It could also 
evaluate the judicial review of agency actions and make recommendations 
for its improvement. A major issue confronting the administrative 
process that has emerged forcibly in the past few years is the delicate 
balance of open government in a time of concern over national security 
and the means by which requirements are imposed on our citizens and 
businesses to protect our homeland.
    Another purpose for renewing ACUS could be to serve as a regulatory 
ombuds. It could in appropriate circumstances investigate and respond 
to individual complaints and undertake a systematic performance review 
of various government agencies, especially of those agencies with 
serious operational and programmatic problems. Individual agencies 
themselves often resist any critical self-evaluation in response to 
public complaints due to burdensome workloads or a failure to admit the 
flaws in one's own prior decisions. An independent, objective entity, 
unfettered by internal agency politics and its own inertia, can offer 
meaningful recommendations to improve the operational structure of 
administrative agencies.
    We also lack a repository on administrative processes that the 
various state governments could call upon for high quality 
administrative procedural advice. ACUS could consider ways to improve 
federal, state, and local relations in different areas, including those 
in which state and local agencies administer federal programs. The 
organization could attempt to promote cooperation and coordination on 
interstate administrative procedural matters to foster a responsible 
and efficient administrative process among the several states. The 
entity would be equipped to advise state agencies and their staffs of 
significant legal developments and emerging trends occurring in the 
area of administrative procedure.
    Another major issue in administrative procedure comes from the 
international harmonization of laws and regulations. As a result of 
harmonization, many domestic regulations will need to be changed to 
bring them into conformity with the international requirements. Just 
how that is to be done is a complex, controversial issue that needs to 
be addressed.
    ACUS was structured to develop objective, non-partisan analysis and 
advice. It had sufficient independence from particular policy-based 
responsibilities, and hence its recommendations were given credence and 
were seen as a detached analysis. The structural makeup could bring 
together an inter-disciplinary collection of experts in the 
administrative process. Membership would preferably include: committed 
senior management agency officials, professional agency staff, 
representatives of diverse perspectives the private sector who deal 
frequently with agencies, leaders of public interest organizations, 
highly regarded scholars from a variety of disciplines, and respected 
jurists. The problems that ACUS should address include management as 
well as legal issues. Thus, its panel of experts should be comprised of 
members with both legal backgrounds and those who may not have legal 
training, such as management, public administration, political science, 
dispute resolution, and law and economics. State interests should also 
be included in the entity's membership by sending representatives from 
certain state agencies or state organizations.
    One final point should be made: Although it is currently 
politically unfashionable to suggest that funding should be increased, 
that is clearly the case here. Throughout its life, ACUS was a huge 
bargain for the United States. But towards the end, inflation had taken 
a huge toll on its stationary authorization, and it was not able to 
function to the full extent of its potential. I suggest strongly that 
the in the process of re-establishing the Conference, the appropriate 
level of funding is the amount of the original statute updated to 
reflect inflation. My own, back of the envelope calculation is that 
that figure would be about $10 million. From 35 years of observing the 
Federal government in action (note that's two words), I firmly believe 
that such an amount should be viewed as an investment that would be 
paid back many times over. Even if it were not, the improved quality of 
the decision making process would be more than worth it. For example, 
what number would anyone put on the costs to our society if the 
procedures that are bursting upon us from the electronic age and 
globalization are not implemented appropriately? This is a tiny price.
    The new ACUS will help significantly in ensuring that our public 
decisions are made effectively, efficiently, and fairly. That is 
clearly a major undertaking, but one ACUS is structured to discharge 
for the benefit of us all.

    Mr. Cannon. Thank you, Professor. We only have two Members 
here but we are going to strictly abide by the 5-minute rule 
and I will--you poke me, because I think we are going to have 
several rounds and then I would probably do better if we go 
back and forth in that fashion.
    Now, you know, I have a brother who actually served on the 
ACUS twice and you know him, Professor Harter.
    Mr. Harter. Can I tell a wonderful story?
    Mr. Cannon. Yeah, you can, but let me ask a question first. 
You worked on neg reg a lot, and he keeps telling me that he is 
solely responsible. Can you clarify the record on his role?
    Mr. Harter. Well, it is certainly true. We were on a panel 
together and it really resulted in one of those lines that I 
absolutely love. And I can't remember how the line came up, but 
we reached a disagreement. He said, well, wait a minute, I have 
the authority to issue that rule. Why should I work with this 
committee? And I turned to him--this is all off the record--and 
I said you have the authority but you lack the power. And that 
is when he became really very much of a proponent of the whole 
idea of working it out with the political constituents.
    Mr. Cannon. That was between times, I think, on the ACUS. 
Thanks. Let me just ask a question that I would like you to 
respond to and then Ms. Payton, because Ms. Payton is saying no 
changes and you are suggesting a substantial broadening to 
bring in professionals from other scientific areas.
    I take it you are actually thinking in terms of an 
increased appropriation to have more staff because you talked 
about staff in particular, and then going to all levels of 
Government. Do you want to flesh that out a little bit and 
then, Ms. Payton, I would like to get your view on that.
    Mr. Harter. I think that the structure at the Conference 
both in terms of numbers and everything is probably okay. I 
would just again in the appointment process, would look for 
more diversity of professional and diversity in general and I 
mean, I think some of the serious management expertise, which I 
think would--really a little more economic ideas, a little 
more, again, different levels of Government, State 
representatives, maybe a NAAG or State Governors. I think it 
would because of the public-private. And I think that on the 
staff level, having a different perspective, and I think some 
of the issues that both--the committee and here have talked 
about, we are facing huge scientific issues. So I think having 
some degree of a technical ability would also help as well. So 
I don't think it needs to be major, and I think the structure 
still works.
    Mr. Cannon. Is that consistent with what you are thinking, 
Ms. Payton?
    Ms. Payton. Well, the way I read the charter, I thought 
that there was authority to appoint those kinds people as 
public members anyway.
    Mr. Harter. Oh, absolutely.
    Ms. Payton. And I also think that ACUS has the authority to 
appoint to its committees people who are not public members of 
ACUS. I believe we have done that. We can. They can.
    Mr. Cannon. So you believe that when you talk about the 
group could regulate itself, you believe that there is plenty 
of latitude in the current charter to do the kinds of things?
    Ms. Payton. That is the way I see it. Now Gary may have 
more.
    Mr. Edles. I think that is absolutely right. I mean it 
does, the statute does indicate that there are to be private 
citizens, members of the private bar, but also other experts in 
the administrative process. And historically ACUS did have 
economists. We often had members, I remember--I believe David 
Piddle, who was then a Consumer Products Safety Commissioner, 
who was basically an engineer, who participated actively in 
ACUS activities. So we did have representation even in the old 
days of people who were not lawyers, although I must say it was 
fundamentally, I think, a lawyers organization.
    Mr. Cannon. Mr. Gray.
    Mr. Gray. I think in terms of the studies that were 
commissioned, they could be studies by economists or 
scientists. There was no limit. It wasn't only study by 
lawyers. So there was plenty of access to expertise outside the 
law.
    Mr. Cannon. Good. Maybe in this context can we talk about 
funding, because when you go outside, I mean what you had in 
ACUS was all these incredibly brilliant people who came 
together and participated with relatively small budgets. But 
when you did study on the outside you commissioned those funds 
for those and that cost money. I suspect what we will do is 
include in our report language the idea that we should be 
looking at these broad groups of people to be representative. 
But do we need more money than what we are talking about so we 
can do these kinds of studies, and maybe, Mr. Gray, you can 
take that question.
    Mr. Gray. I really would like to get Gary's perspective on 
this, but I think it would be very useful to have more funding 
because our outreach would be much broader. I have taken as an 
example, what I suggested, which may not be workable, but this 
EU comparative project I think would be ultimately better done 
by an impartial entity like ACUS rather than a private entity 
with questions about its funding. It is going to cost a hundred 
thousand dollars to do that.
    Mr. Cannon. I am sorry. How much?
    Mr. Gray. A couple of $100,000 and that is not the kind of 
thing the private sector can come up with without raising 
questions about where it came from, and yet it is not that 
much, it seems to me, for it be funded out of something like 
that because it is not a backbreaking, seems to me, figure. All 
I know is there are all kinds of budget constraints.
    Mr. Cannon. I would like to pursue this topic a little bit 
more so we can get some clarity on the record, but my 5 minutes 
has expired and we will come back to that.
    Mr. Watt, would you like to take 5 minutes?
    Mr. Watt. Thank you, Mr. Chairman. Let me just play devil's 
advocate here for a little bit, because we have now heard from 
six witnesses, all of whom have been vigorously in support of 
reauthorizing, and while I certainly share that view, one of 
our obligations, I think, and in the process that I described 
and referred to in my opening statement works best, we get both 
sides of an issue and there has not been any witness yet who 
has said this would be a terrible idea.
    Let me be further provocative to--and probably 
counterintuitive to assume that there was a rational basis for 
terminating the Administrative Conference of United States. 
When I look back and realize that that happened in 1995, I kind 
of have to step back from that because there was a lot of stuff 
happening in 1995 that was not based on any rational 
evaluation. So I have got an opportunity here to put all of 
this together because I have got people, I think, who 
understand the history of how we got here.
    What was the rationale, if there was a rationale, for 
terminating this agency?
    Mr. Edles. I can tell you what the House Appropriations 
Committee report said, which is simply that ACUS had completed 
its mission as of 1995. As to whether there were other 
rationales, I can only say what the public report said.
    Mr. Watt. Were there any kind of hearings to document the 
completion of that mission or any discussion to build a record 
in support of that conclusion?
    Mr. Edles. There was a hearing--there were hearings, I 
think, before this Committee which fundamentally came out 
supporting the Administrative Conference. We did have our 
usual, you know, hour and a half or 2 hours before the 
Subcommittee on Appropriations. That was the oversight provided 
for us insofar as our annual appropriation was concerned and it 
was presumably on the strength of that, you know, hour and a 
half meeting and information we had submitted in which the 
Subcommittee came to the conclusion that we should be--we 
should no longer be funded. But I think it was an era, quite 
frankly, in which there was a looking around to see if there 
could be widespread Government retrenchment.
    Mr. Watt. This was reform.
    Mr. Edles. And our little agency, I think, is what came up 
in that time.
    Mr. Watt. Mr. Harter, you look like you are just chomping 
at the bit----
    Mr. Harter. No, I am not sure I am chomping.
    Mr. Watt.--to respond to this question.
    Mr. Harter. I will add a little bit to the discussion, and 
in my view I think it was time that the Conference needed to be 
revitalized. I mean I think that it needed to be energized and 
what not. I am not sure that I would take the boot heel that 
was taken to it, I mean to this kind of the ultimate one. But I 
think it needed resparking along the lines that I think a lot 
of us have been talking about here, and I think in part my view 
is that it lacked as much of the energetic and enthusiastic 
support at that time that you are seeing now for the 
reconstruction of it.
    I mean, I think that a lot of issues have emerged that are 
not getting addressed, and so it might be that this had become 
slightly torpid in that way.
    Mr. Watt. Mr. Gray, you were--you said you testified at a 
hearing where this was evaluated. Were there compelling reasons 
advanced on the opposite side of where you were? You were in 
favor of reauthorizing, according to your testimony. Were there 
other people on the other side who were making some compelling 
arguments to terminate?
    Mr. Gray. Well, I have to be candid since I am testifying. 
There were interests, private interests, if you will, that were 
opposed to the reauthorization. But they never really surfaced 
publicly with their arguments. I think what was public was the 
testimony rather to the contrary that it should be 
reauthorized.
    Mr. Watt. Okay.
    Mr. Cannon. We will come back for another round. Did you 
want to add something to that, Ms. Payton?
    Ms. Payton. Well, I think that everyone here at the witness 
table is being reluctant to say what we all know. May I suggest 
that----
    Mr. Watt. I am prone to go to meddling in stuff that makes 
people have to come to grips with that.
    Ms. Payton. Right. Well, I think you might find it useful 
to read at least some excerpts of a law review article by Toni 
Fine, which appeared in the U.S. Law Review \1\ a little while 
ago, that really goes to the legislative issues of the demise 
of ACUS. You would find that very useful in its meticulous 
detail.
---------------------------------------------------------------------------
    \1\ The correct reference to the article cited by Professor Payton 
in her testimony is as follows: Toni M. Fine, A Legislative Analysis of 
the Demise of the Administrative Conference of the United States, 30 
Ariz. St. L. J. 19 (1998).
---------------------------------------------------------------------------
    Mr. Cannon. Ms. Payton, could you make that article 
available for our review or at least give us the citation so we 
would like to have that be part of the record?
    Ms. Payton. Certainly.
    Mr. Cannon. Thank you. Just for the record you should be 
aware that the Administrative Law Subcommittee had a hearing on 
ACUS and reported out that language to reauthorize it when the 
Appropriations Committee decided not to. I have actually talked 
to people who were engaged in that process, both Democrat and 
Republicans, and they don't remember it. I think this is just--
I would love to suggest the point of all that is that ACUS's 
work was not widely understood beyond the people that were 
involved, and I would hope that one of the agenda items, one of 
the things that the ACUS would do would be to have staff to 
make sure that Congress understands what they are doing.
    I don't think we have any real serious opposition to 
reestablishing ACUS short of that. We were talking about 
funding a bit ago, and in my opening statement we talked about 
a couple of other projects that ACUS did over a 28-year period 
of time and we are talking about this study.
    Mr. Gray, do you think it would cost $100,000--I think it 
would be at least that--to do that kind of depth that we want 
to do? How many studies--given the kind of workload of 28 
years, you are looking at 10 or fewer series of projects--how 
many studies should we be looking at? One per year, one every 
other year, five per year? Do you have any sense of how much 
ACUS can do and how much?
    Mr. Gray. Well, I think because it has not been around for 
nearly 10 years there is a backlog of things that need to be 
looked at. I mentioned just three of them, including in 
addition to the European Union project that come to my mind, 
and in dealing with the quality of purity, which are related 
topics. So perversely it might take more to get it underway and 
make the backlog through of things that need to be looked at, 
and it might then drop afterwards.
    Again I look to Gary. I think he ran this. I was on the 
council, but I wasn't involved in daily administration, and I 
think you had a better answer.
    Mr. Cannon. Let me just say here that I agree with your 
analysis. You may have a big need that may trail off, and so my 
sense is that when we are talking $3 million you might need to 
pick it up a little bit so that we authorize enough to actually 
do what needs to be done?
    Mr. Edles. Yeah. Over my period, 1987 to 1995, I think we 
probably tackled a dozen fundamental, major projects each year. 
I think a couple points on the value here. One is that we--all 
the private sector members who participated did so pro bono. I 
mean, people like Boyden Gray did not get their hourly rate 
when they did work for the agency. They did all of that as 
volunteers and did a lot of hard work as volunteers. Secondly, 
the law professors by and large, although some of them were not 
law professors who served as consultants to ACUS, never really 
got market rates for what they were doing. There was first of 
all, their desire to have entree to Government agencies, which 
they got through the Administrative Conference, which they 
could not have gotten if they were just a law professor doing a 
study of some agency. They would not have gotten a hospitable 
relationship of the type that they got because of ACUS. So they 
were eager to do their projects through the Administrative 
Conference, and the Administrative Conference on the other side 
was quite willing to have them publish their studies in an 
independent law environment. So through that sort of symbiotic 
relationship we managed to get them at well below market rates.
    And I think our projects, we used to fund them in the range 
of $10,000. I mean, things of that nature. I think some 
probably as little as $5 or $6,000. Maybe some were a little 
more pricey if they had to be done fast or if there was more 
than one consultant that needed to be used. But, you know, we 
were not talking in the hundreds of thousands of dollars for 
individual consulting projects the way the Government does 
normally.
    [3:30 p.m.]
    Mr. Cannon. Thank you.
    Professor Harter, I resonated with your personal comments 
about the Internet. I would like to go to you.
    You talked about the Internet rulemaking and what 
essentially becomes ex parte communications in the open. In the 
last 4 days, I have had four opinion pieces or opinion page 
articles in the Washington Journal about me and what I am doing 
on immigration; and that is sort of cool, except there are at 
least a dozen and probably 100 Web sites out there that are 
saying horrible things about me. And I looked a little bit, or 
attempted to look, but there is no way on the face of the Earth 
that I could respond to all that is said by people who don't 
like what I stand for and do on immigration.
    How do you deal in a world of information with people who 
want to see things--how do you deal with that? Nobody has the 
resources except the fanatic or the corporation that has the 
money to do it. So I am impressed by your thinking about that, 
and I have been thinking about that.
    We have had issues on the Forest Service where we had 2 
million comment, because they are organized. They are in 
environmental groups. And the other side, maybe you had 50,000 
barbers who inarticulately got online and said I don't like 
what they are suggesting. And so you weigh those which we don't 
do but we do do and you come up with skewed decisions.
    You obviously have thought about this a little bit. Would 
you mind commenting about what we do with the Internet?
    And secondly, both of you, Ms. Payton, is the structure--
the current structure of ACUS sufficient to deal with these 
kinds of challenges?
    Mr. Harter. I am not sure I can address the technical 
aspects of the Internet. There is a lot of thinking going on 
about it; and, in fact, the Forest Service rule is one that is 
commonly used in talking about, well, let us have the computer 
screen the rule. The computers will read the 2 million rules 
and tell you what the various comments were.
    I think what my point is, is that what really--and NSF has 
a program that is looking at it. American University has a 
program that is looking at it. There is one inside the 
Government that is sponsored by the White House and EPA that is 
looking at it. But these groups need to talk to each other, and 
the public at large needs to participate in some of the 
discussions.
    I mean, I gather, from talking to people who have been 
deeply involved in it, this whole issue of the response, the ex 
parte in the open is really not looking at it. They are looking 
at the technology, as opposed to what is happening with--the 
average person can't keep up with it. So I don't have an answer 
to it.
    Those of us who do what I do often quip: I don't do 
substance, I do procedure. And what is really needed, I think, 
is an advisory committee to talk about it and come up with 
guidelines on it that will take these issues into account. It 
strikes me that is the perfect vehicle to do it. It is built 
that way and comes up with the recommendations that are broadly 
representative, so it is the perfect vehicle to do that. When I 
raised the prospect of an advisory committee, I didn't get the 
courtesy of a response.
    Mr. Cannon. You think ACUS, the way it was set up, could 
handle it?
    Mr. Harter. Absolutely. They may need a new committee, but 
that is easy, and that takes 4 minutes.
    Ms. Payton. Let me muse a little in a way that I don't 
ordinarily do on the record.
    The revised ACUS needs to have both the range of interests 
represented that allows it to be a kind of very high-status, 
diverse group. On the other hand, it needs to be nimble and 
flexible and needs to be able to do something about all these 
problems; and it needs to be able to respond in a shorter time 
frame than having recommendations deliberated at a plenary 
session.
    I guess the one thing I would suggest is that 
recommendations be allowed to be promulgated--to be made by 
groups that are smaller than the plenary session. Now that is 
how the National Academy of Sciences does it, and that is how 
the National Academy of Public Administration does it.
    I am not taking a position on behalf of NAPA as a whole. 
The organization that is authorized to comment is the EOM 
panel, which is a subunit of NAPA; and this is the way in which 
we compromise between our interests in having a diverse general 
membership and then subject matter panels that are expert but 
that themselves are fairly diverse and they can respond to 
these things.
    I think the work of ACUS would be enormously improved if 
all recommendations didn't have to go through that plenary and 
if people who were not public members of the conference as a 
whole could sit on committees, and then you would have 
something that looked a lot more like the National Academy of 
Sciences.
    I would say that when you start expanding that mandate--and 
I am speaking as an advocate--when you start expanding that 
mandate, I am afraid that you draw the attention of ACUS away 
from the small. Now, ironically, it is the small that can't get 
any attention paid to it unless ACUS pays attention to it. So 
what I would say, if you want to expand that mandate, you have 
to give ACUS some sort of incentive to make sure that it keeps 
tending after these fairly minor issues. It has to have a 
division that does that or something of the sort.
    Mr. Cannon. Thank you. I have gone over my time, and I 
apologize. Mr. Watt.
    Mr. Watt. I just wanted to get an appreciation of what the 
prior budget was before the termination and if we extrapolate 
out with some reasonable cost of living adjustment what that 
would result in.
    Mr. Edles. The budget when ACUS was abolished was $1.8 
million, and it had a staff of 18 employees at that time. At 
the high water mark of ACUS, I think it had a budget of $2.3 
million. That was the highest ever, and that supported a staff 
of 24 employees.
    Mr. Watt. And if you were thinking about the ideal--taking 
into account the backlog of things that has not been attended 
to since ACUS has not been in existence, first of all, for how 
long--how long do you think it would take to get that backlog 
taken care of and to what extent would the budget be ramped up 
for that period of time and for what period of time?
    Mr. Edles. I don't think I can answer either of them, how 
long it would take or how much it would cost.
    I can tell you that when President Eisenhower set up the 
first temporary conference, he did that in 1951. That 
conference lasted for 2 years. So it was over, I guess, in 
1955. By 1961, President Kennedy had to set up another 
temporary conference, which means that over a period of 4, 5 
years there was again a need for additional work.
    The first temporary conference came up with about 30 
recommendations, as I recall reading, and the second temporary 
conference also with something on the order of 30 
recommendations. I don't really have a real strong feeling as 
to, you know, how many various projects there are out there. I 
suspect there are scores of them that could be usefully done at 
this stage. And I think $10 million would probably be a 
wonderful figure. I think, quite candidly, something in the 
neighborhood of 2 to 3 million would probably be more 
politically acceptable.
    Mr. Watt. At least for a start. At least to start.
    I am just trying to create a record here with expert input, 
which I think, even if you are guessing, if it is an educated 
guess, is better than having an appropriator pull a figure out 
of the sky, I guess is the point I am making. So I want--let me 
just encourage each of you to do some creative thinking about 
this, whether you do it today or whether you submit it to us to 
supplement the record subsequent to today's hearing. I think 
you all are in a better position to evaluate this than either 
the Chairman or I would be and certainly in a better position 
than some appropriator pulling a figure out of the sky would 
be. So if you don't have a good feel for it today, I would just 
hope that you would give it some thought, give us your input 
and the basis on which you make that input.
    Mr. Cannon. Without objection, I suggest we leave the rest 
of the record open for 7 days so you all could submit your 
thoughts on funding to us.
    Mr. Watt. There are some responses that they may be 
prepared to make today.
    Mr. Cannon. Without objection, so ordered, on leaving the 
record open.
    Ms. Payton. I am so nervous about the prospect of diluting 
the main focus of ACUS. One of the reasons why you are getting 
such a bipartisan, enthusiastic response is exactly that ACUS 
did something that was enormously important and irreplaceable, 
something that only ACUS could do and no one else will.
    When you start expanding the role of ACUS, you may wind up 
in terrain that other people think they already occupy; and it 
is almost possible that this measure that at the moment is 
going forward so smoothly may encounter some rocky places.
    Mr. Watt. I guess my response to that is I think it is part 
of our responsibility to forward some parameters with this, not 
just to say we reauthorize ACUS, but we reauthorize it up to a 
figure of x amount per year. Now whether the appropriators buy 
that figure or not, I think may be--if this process works as it 
should work, it will be in direct proportion to the--our having 
justified it and built a record in support of it. And I think 
that is much--a much better way, even if you come up with 
different figures, with different visions. As long as we 
understand what your assumptions are, we have built a record 
and can take that into account in our Subcommittee and full 
Committee's evaluation on the authorizing side, which is what 
our responsibility is in this process.
    Mr. Harter. When I discovered my error in the testimony, I 
actually gave considerable thought--although, obviously, a lot 
of it is guess. Let me just sort of give food for that. And I 
share the concern one wants to keep it closely cabined or 
corralled, focused on the administrative process. My definition 
may be broader, but when it gets beyond that, it will encounter 
opposition that will be adverse.
    On the other hand, I think there are a number of different 
parts of what the conference does that we need to be focused 
on. I think there are a whole series of large processes that 
Boyden has been talking about that would need to be undertaken, 
especially given the hiatus. There are a whole series of 
smaller ones.
    In individual research areas, you get professors to do 
things on the cheek so long as there is not a lot of research, 
but research is expensive to get it done. And it strikes me in 
the latter days of the conference that it was having trouble 
coupling together enough resources to do good projects. It was 
getting money from other agencies. It was soliciting from the 
people it was going to study. It makes me a little nervous, and 
I think it diminished its nimbleness.
    I certainly echo the idea of having the broader committees. 
So, from my view, I would be concerned if it really were 
constrained only $2 million or $2.5 million. I don't think it 
can really function effectively at that rate to get it done. My 
own view, a minimum of $5 million is necessary; and, frankly, I 
would go with the $10 million, with the urging that 5 is 
probably the minimum. If it is too scant, the quality of the 
studies just aren't as thorough and as good; and part of its 
real advantage was thorough studies and a bipartisan support of 
the recommendation.
    Mr. Watt. Can I ask one more question, Mr. Chairman, just a 
corollary to that? For a 5 or $10 million investment, what 
would you project the savings were that resulted from just 
the--what was the major initiative?
    Mr. Harter. Let me give a figure you can't put a number on. 
I just completed 2 years ago a negotiated rulemaking for OSHA 
on building steel buildings. The subpart R of OSHA's rules that 
had been on OSHA's docket for 20 years, they had tried multiple 
times to revise the rule, each time unsuccessfully. The 
negotiated rule worked it through. Unanimous recommendation. 
OSHA implemented it. The fatalities in steel erection are 
currently about a third of what they were then. We are talking 
about probably 20 deaths a year. What is the number? The 
regular rulemaking didn't work for 20 years.
    Mr. Watt. There is method to my madness here, because this 
is the record building stage. Because I think it is our 
obligation to document the best we can the cost benefit of this 
reauthorization, and so I am being a little bit more meticulous 
than I would normally be because of that. I think we need to 
anticipate some of these issues, and if you all can submit 
something to us having thought about it in some more detail--I 
am not looking for you to be uniform. There is benefit I think 
in not being uniform. We are not asking you to get together as 
a group and come up with a group figure or a group vision or a 
group benefit, cost-benefit analysis, but this is the kind of 
information that I think would be helpful to have in the record 
to document not only the cost and what the reasonable costs 
should be to accomplish whatever the vision is that could 
differ from panelist to panelist but to document also the 
benefit of that cost; and that is, I think, what we don't do 
nearly enough of in this body.
    I will yield back.
    Mr. Cannon. I would like to go through some notes and make 
some statements; and if you want to take notes, I will leave it 
open for you to comment on that.
    I appreciate, Mr. Gray, very much your statements. I think 
it extraordinarily important that we do this so that we stay 
ahead of the rest of the world. For me, that is very, very 
important. We have a world in which we can be transparent 
instead of opaque. We may be more transparent than Europe, but 
we want to be more transparent. I am a big fan of John Graham, 
and I appreciate your comments on him. This Subommittee is 
actually focusing on helping out there.
    Mr. Edles, you talked about--you made a great record. I 
really appreciate that. And you talked about the institutional 
memory. I just think that is remarkably important. We can put 
this back together with many people who are now and were in the 
prime of their lives that know what happened and know what we 
can do. And one of the things I hope we can do here is go from 
taking the negotiated regulation or rulemaking model to a 
negotiated permitting model.
    We are in a position where we have had massive forest 
fires, and we can't deal with that in Congress. We fiddled 
around for 2 or 3 years now on the Healthy Forest Initiative, 
and we still can't get a consensus out of this body. We will 
never get a consensus out of this body. And we are not going to 
cut trees until we come up with a process that a rulemaking 
agency can do, and that is in part rulemaking but I think in 
larger part it is going to be a negotiated process for 
permitting--permitting the cutting of trees, permitting of 
drilling the wells and things like that so we that can come up 
with a process that actually works.
    The problem with it, of course--and, Ms. Payton, you talked 
about these things don't work until something major goes wrong. 
And we have some major problems. In the case of forests, for 
instance, you have a forest fire because we didn't tend to the 
forests because we could issue permits for cutting trees in a 
way that everybody agrees. There is a way to make sense. It is 
just that no agency is going to come up with a permit that 
doesn't allow for litigation to stop the cutting of trees; and 
if it is not a healthy forest, we end up with massive forest 
fires. We lose the trees, lose the watershed, lose the 
endangered species. We are letting extreme conditions drive 
major issues that, when you get settled into a discussion with 
reasonable people, you come to conclusions.
    But it is not the reasonable people that bring the 
lawsuits. It is the people that have an agenda that is outside 
and choose their judge and all that because we abdicated. That 
is, America got rid of acres and acres. So negotiating the 
permitting I think is one of the incredibly important things 
that we are doing.
    Many things have been said today, and we appreciate your 
comments. Are there any comments on what I have said or----
    Well, then I will yield back the time I have. Mr. Flake, do 
you have any questions?
    Mr. Flake. No questions.
    Mr. Cannon. Thank you for your attendance here. Your being 
here I think has created a record that is remarkable. More 
importantly, it will draw attention to people who need to 
understand how important this is and give us a boost in moving 
this legislation through and getting not only the 
reauthorization but funding from the appropriators. We 
appreciate your presence here today and thank you.
    The hearing is adjourned.
    [Whereupon, at 3:55 p.m., the Subcommittee was adjourned.]


                            A P P E N D I X

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               Material Submitted for the Hearing Record

         Response to post-hearing questions from C. Boyden Gray













         Response to post-hearing questions from Gary J. Edles



































        Response to post-hearing questions from Sallyanne Payton















        Response to post-hearing questions from Philip J. Harter









             Letter from Michael Herz and David Rudenstine





                                 
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