[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]


 
                        CONGRESSIONAL REVIEW ACT

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

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                   COMMERCIAL AND ADMINISTRATIVE LAW

                                 OF THE

                       COMMITTEE ON THE JUDICIARY
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                               __________

                            NOVEMBER 6, 2007

                               __________

                           Serial No. 110-165

                               __________

         Printed for the use of the Committee on the Judiciary


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


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                       COMMITTEE ON THE JUDICIARY

                 JOHN CONYERS, Jr., Michigan, Chairman
HOWARD L. BERMAN, California         LAMAR SMITH, Texas
RICK BOUCHER, Virginia               F. JAMES SENSENBRENNER, Jr., 
JERROLD NADLER, New York                 Wisconsin
ROBERT C. ``BOBBY'' SCOTT, Virginia  HOWARD COBLE, North Carolina
MELVIN L. WATT, North Carolina       ELTON GALLEGLY, California
ZOE LOFGREN, California              BOB GOODLATTE, Virginia
SHEILA JACKSON LEE, Texas            STEVE CHABOT, Ohio
MAXINE WATERS, California            DANIEL E. LUNGREN, California
WILLIAM D. DELAHUNT, Massachusetts   CHRIS CANNON, Utah
ROBERT WEXLER, Florida               RIC KELLER, Florida
LINDA T. SANCHEZ, California         DARRELL ISSA, California
STEVE COHEN, Tennessee               MIKE PENCE, Indiana
HANK JOHNSON, Georgia                J. RANDY FORBES, Virginia
BETTY SUTTON, Ohio                   STEVE KING, Iowa
LUIS V. GUTIERREZ, Illinois          TOM FEENEY, Florida
BRAD SHERMAN, California             TRENT FRANKS, Arizona
TAMMY BALDWIN, Wisconsin             LOUIE GOHMERT, Texas
ANTHONY D. WEINER, New York          JIM JORDAN, Ohio
ADAM B. SCHIFF, California
ARTUR DAVIS, Alabama
DEBBIE WASSERMAN SCHULTZ, Florida
KEITH ELLISON, Minnesota

            Perry Apelbaum, Staff Director and Chief Counsel
                 Joseph Gibson, Minority Chief Counsel
                                 ------                                

           Subcommittee on Commercial and Administrative Law

                LINDA T. SANCHEZ, California, Chairwoman

JOHN CONYERS, Jr., Michigan          CHRIS CANNON, Utah
HANK JOHNSON, Georgia                JIM JORDAN, Ohio
ZOE LOFGREN, California              RIC KELLER, Florida
WILLIAM D. DELAHUNT, Massachusetts   TOM FEENEY, Florida
MELVIN L. WATT, North Carolina       TRENT FRANKS, Arizona
STEVE COHEN, Tennessee

                     Michone Johnson, Chief Counsel

                    Daniel Flores, Minority Counsel


                            C O N T E N T S

                              ----------                              

                            NOVEMBER 6, 2007

                                                                   Page

                           OPENING STATEMENTS

The Honorable Linda T. Sanchez, a Representative in Congress from 
  the State of California, and Chairwoman, Subcommittee on 
  Commercial and Administrative Law..............................     1
The Honorable Chris Cannon, a Representative in Congress from the 
  State of Utah, and Ranking Member, Subcommittee on Commercial 
  and Administrative Law.........................................     2

                               WITNESSES

The Honorable John V. Sullivan, Parliamentarian, United States 
  House of Representatives, Washington, DC
  Oral Testimony.................................................     4
  Prepared Statement.............................................     5
Mr. Mort Rosenberg, Specialist in American Public Law, 
  Congressional Research Service, Washington, DC
  Oral Testimony.................................................    10
  Prepared Statement.............................................    12
Ms. Sally Katzen, Visiting Professor, George Mason University 
  School of Law, Washington, DC
  Oral Testimony.................................................    26
  Prepared Statement.............................................    28

                                APPENDIX
               Material Submitted for the Hearing Record

Answers to Post-Hearing Questions from the Honorable John V. 
  Sullivan, Parliamentarian, United States House of 
  Representatives, Washington, DC................................    44
Answers to Post-Hearing Questions from Mort Rosenberg, Specialist 
  in American Public Law, Congressional Research Service, 
  Washington, DC.................................................    46
Answers to Post-Hearing Questions from Sally Katzen, Visiting 
  Professor, George Mason University School of Law, Washington, 
  DC.............................................................    48


                        CONGRESSIONAL REVIEW ACT

                              ----------                              


                       TUESDAY, NOVEMBER 6, 2007

              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 2237, Rayburn House Office Building, the Honorable Linda 
Sanchez (Chairwoman of the Subcommittee) presiding.
    Present: Representatives Sanchez, Johnson, and Cannon.
    Staff present: Eric Tamarkin, Majority Counsel; Daniel 
Flores, Minority Counsel; and Adam Russell, Professional Staff 
Member.
    Ms. Sanchez. The Committee on Commercial and Administrative 
Law will come to order. And I will now recognize myself for a 
short statement.
    In 1996, under a Democratic President, a Republican 
Congress passed as a part of the Contract with America, the 
Congressional Review Act. This act created procedures for 
legislative oversight of administrative rulemaking. Eleven 
years later I hope that the parties can once again come 
together in a bipartisan effort to examine some of the 
processes of the CRA.
    The CRA established a provision, the joint resolution of 
disapproval, by which Members of Congress may disapprove agency 
rules found to be too burdensome, excessive, inappropriate, 
duplicative or otherwise objectionable. Since the CRA was 
signed into law, 43 joint resolutions of disapproval have been 
introduced relating to 32 rules. None of the House joint 
resolutions have passed the House, and only three of the Senate 
joint resolutions passed the Senate.
    Only one Senate joint disapproval resolution of the 
Occupational Safety and Health Administration's controversial 
ergonomic standards, in March 2001, also passed both the House 
and Senate. This disapproval was the result of an unusual 
confluence of factors, including the White House and both 
houses of Congress in the hands of the same political party, a 
contentious rule promulgated in the waning days of an outgoing 
Administration, longstanding opposition to the rule by some in 
Congress and by a broad coalition of business interests, and 
encouragement of repeal by the President.
    The entities tasked with implementing the CRA have faced 
significant administrative burdens. The CRA requires that all 
agencies promulgating a rule must submit a report to each house 
of Congress and to the comptroller general at the General 
Accounting Office.
    To date agencies have submitted 47,136 rules. As a result, 
GAO, the parliamentarians and the clerk's office in the House 
and Senate have experienced a deluge of paperwork. According to 
the House Parliamentarian, who is testifying today for the 
second time before this Subcommittee on this issue, the number 
of annual executive branch communications to the speaker of the 
House has nearly tripled since the enactment of the CRA.
    In order to relieve some of the administrative burdens of 
the CRA and to reduce duplicative paperwork, former Judiciary 
Committee Chairman Henry Hyde introduced H.R. 5380 in the 106th 
Congress with current Chairman of the Committee, Mr. Conyers, 
former Representative George Gekas and Representative Gerald 
Nadler as co-sponsors. I look forward to hearing ideas from our 
witnesses on how to improve the congressional oversight of 
executive branch agency rulemaking and whether the previously 
introduced legislation is an appropriate approach for reforming 
and streamlining the CRA. I believe many of my colleagues join 
me in seeking a balanced approach that will allow us to 
effectively perform our oversight function.
    At this time, I am now pleased to recognize my colleague, 
Mr. Cannon, the distinguished Ranking Member of the 
Subcommittee for his opening remarks.
    Mr. Cannon. Thank you, Madam Chair. We are here today to 
look at the Congressional Review Act, a law passed by Congress 
and an important tool in the oversight of administrative 
rulemaking. As I have highlighted in the past, when Congress 
passes complex legislation, it often leaves many of the details 
to the agencies authorized to enforce the laws. This body must 
remain vigilant over those details and how they are filled in 
by the agencies. We must do that through congressional 
oversight.
    To support that essential effort, the Congressional Review 
Act established a mechanism for Congress to review and 
potentially disapprove of Federal agency rules through an 
expedited legislative process. It requires agencies to report 
to Congress and the comptroller general information to help us 
assess the merits of the rules.
    We have yet to actually disapprove of many rules under the 
act. That is not to say that many rules in the past did not 
merit review or that many rules were not controversial. That is 
not to say that we will not in the future disapprove of many 
rules. We may, but so far we haven't.
    This raises a couple of questions. First, are there ways in 
which the act itself may be impeding our ability to oversee 
rulemaking? Second, are unnecessary burdens accumulating on 
those who help us review agency rules as we, for whatever 
reason, do not move through the Congress enough disapprovals of 
agency rules.
    Those interviews include, for example, the House 
Parliamentarian's office. Third, to what extent should the 
Congress review agency actions? I personally believe agency 
actions, including guidance documents, policy statements, 
changes to program manuals, and personnel handbooks should be 
reported to Congress for review. I also believe regulations 
should be voted on by Congress before they become law.
    Let me just pause for a moment here and point out that the 
problem with this hearing is that we are dealing with one 
aspect of our role in Congress. And we are doing that in a 
world that has changed rapidly around us where government has 
become much more complex, where the extent of rulemaking and 
guidance documents have become much more complex. And all of 
that in the context of a law that we passed in the 1960's and 
really hasn't been updated.
    So what we need to get back to, this study that we have had 
done ongoing for the last 6 years, begun by former Chair George 
Gekas, and on a bipartisan basis studied by academics across 
the country, to deal with the complexities that we have found 
ourselves in and the tools that we are not availing ourselves 
of as we deal with these complex issues in a world where people 
need to understand what the rules are so they can operate their 
businesses from day to day. So I think we need to do that.
    That said, our witnesses will help us sort some of these 
issues that relate solely to the CRA today. But I want to 
stress that we should sort them out with an eye to making the 
Congressional Review Act more efficient and more effective, not 
with an eye just to shift the burdens from one body to another 
and not with an eye to give up on the act in any way. Why? 
Because just shifting the burden isn't real reform. And giving 
up on the act simply is not an option.
    And I think that is what our panel will help us understand 
today. As I stressed at the outset, this body must remain 
vigilant over agency efforts to fill in the nuts and bolts of 
the statutes we pass. And we must do that through real 
congressional oversight.
    I thank you, Madam Chair. And I yield back.
    Ms. Sanchez. I thank the gentleman for his statement.
    Without objection, other Members' opening statements will 
be included for the record. Without objection, the Chair will 
be authorized to declare a recess of the hearing at any point.
    I am now pleased at this time to introduce the witnesses 
for today's hearing. Our first witness is Mr. John Sullivan. 
Mr. Sullivan has served as the House Parliamentarian from 2004 
to the present. Prior to his current appointment, he served as 
both the assistant parliamentarian and counsel to the House 
Committee on Armed Services. Mr. Sullivan served in the United 
States Air Force from 1974 until 1984.
    Welcome, Mr. Sullivan.
    Our second witness is Mort Rosenberg. Mr. Rosenberg is a 
specialist in American public law in the American law division 
at CRS. For more than 25 years Mr. Rosenberg has been 
associated with CRS. Prior to his service with that office, he 
was chief counsel to the House Select Committee on Professional 
Sports.
    And he has held a variety of other public service 
positions. In addition to these endeavors, Mr. Rosenberg has 
written extensively on the subject of administrative law.
    We welcome you, Mr. Rosenberg.
    Our final witness is Sally Katzen. Professor Katzen is a 
visiting professor of law at George Mason University from the 
University of Michigan Law School where she taught 
administrative law and information technology policy courses. 
Prior to joining academia, Professor Katzen served nearly 8 
years in the Clinton administration first as the OIRA 
administrator, then as deputy assistant to the President for 
economic policy and deputy director of the National Economic 
Council in the White House, and finally as the deputy director 
for management at OMB.
    And I thank you as well for being here.
    Thank you for agreeing to testify at today's hearing. 
Without objection, your written statements will be placed into 
the record in their entirety. And we are going to ask that you 
please try to limit your oral remarks to 5 minutes.
    You all, I am sure, having all testified before Congress, 
are aware of the lighting system. The light will turn green. 
When you have 1 minute remaining it will turn yellow as a 
warning. And when it turns red, your time has expired.
    We would appreciate it if you would conclude your testimony 
when you see the red light so that we can get to everybody. And 
after each witness has presented their oral testimony 
Subcommittee Members will be permitted to ask questions subject 
to the 5-minute limit.
    With that, I will invite Mr. Sullivan to please proceed 
with his testimony.

 TESTIMONY OF THE HONORABLE JOHN V. SULLIVAN, PARLIAMENTARIAN, 
     UNITED STATES HOUSE OF REPRESENTATIVES, WASHINGTON, DC

    Mr. Sullivan. Thank you, Madam Chair, Mr. Ranking Member. I 
am glad to be here with you to discuss this important matter. I 
have no narrative to add to my written testimony. And I won't 
take up your time by paraphrasing what I have already 
submitted. But rather, I will be prepared to answer your 
questions when we get to that point. And I will let you go on 
to the statements by my colleagues. Thank you for having me.
    [The prepared statement of Mr. Sullivan follows:]

          Prepared Statement of the Honorable John V. Sullivan











    Ms. Sanchez. I think that is probably the shortest oral 
testimony this Subcommittee has ever received. We will, of 
course, elicit some, I am sure, testimony during our 
questioning period.
    Mr. Rosenberg. Can I have his 4 and-a-half minutes?
    Ms. Sanchez. We will give you a little more leeway, Mr. 
Rosenberg. And at this time, I am going to invite you to go 
ahead and present your testimony.

TESTIMONY OF MORT ROSENBERG, SPECIALIST IN AMERICAN PUBLIC LAW, 
         CONGRESSIONAL RESEARCH SERVICE, WASHINGTON, DC

    Mr. Rosenberg. Thank you very much, Madam Chair, Mr. 
Cannon. It is a pleasure to be here again. Just quick, one 
thing I was--I have been with CRS for 35 years.
    Ms. Sanchez. My apologies, sir.
    Mr. Rosenberg. I am very pleased to be before you again, 
this time to discuss the Congressional Review Act, a statute 
that I have closely monitored since its enactment in 1966. Your 
Committee's continued focus on this important piece of 
legislation is both opportune and hopefully propitious.
    As the CRS report on the decade of experience under the CRA 
details, we know enough now to conclude that it has not worked 
well to achieve its original objectives. That is to set in 
place an effective mechanism to keep Congress informed about 
the rulemaking activities of Federal agencies and to allow for 
expeditious congressional review and possible nullification of 
particular rules.
    The numbers that you have told us about, the 46,000 rules 
that have been reported and the over 700 major rules, only one 
of which has been nullified, are quite telling about the effect 
of the rule, I believe. Commentators have expressed the belief 
that the negation of the ergonomics rule was a singular event 
and not likely soon to be repeated.
    Furthermore, not nearly all the rules defined by the 
statute as covered are reported for review. The number of 
rules, of covered rules is likely to be significantly more than 
the number that are actually submitted for review.
    Federal appellate courts in that period of 11 years had 
negated all or parts of about 60 rules, a number, which while 
significant in some respects, is comparatively small in 
relation to the number of rules issues in that period. Indeed, 
at a hearing that you held in September, Professor Jody Freeman 
of Harvard presented the tentative conclusions of a study of 
judicial review of rulemaking that, contrary to popular myth, 
apparently the courts are not part of the problem, that indeed, 
the number of rules that have been, you know, successfully 
challenged is quite small. And the major part of them are 
limited to two agencies.
    The framers of this legislation anticipated that the 
effective utilization of a new reporting and review mechanism 
would draw the attention of the rulemaking agencies and that 
its presence would become an important factor in the rule 
development process. That has not happened because the 
ineffectiveness of the CRA review mechanism soon became readily 
apparent both to agencies and observers.
    The lack of a screening mechanism to identify rules that 
warranted review and the absence of an expedited consideration 
process in the House that complemented the Senate's procedures 
and numerous interpretative uncertainties of the key statutory 
provisions arguably have deterred its use. By 2001, one 
commentator opined that if the perception of a rulemaking 
agency is that the possibility of congressional review is 
remote, ``it will discount the likelihood of congressional 
intervention because of the uncertainty about where Congress 
might stand on that rule when it is promulgated years down the 
road, an attitude that is reinforced so long as the agency 
believes that the President will support its rules.''
    Further reinforcing the perception that Congress would not 
likely intervene in rulemaking, particularly after 2001, has 
been in the emergence of what has been called by one scholar as 
the new presidentialism, which encompasses the notion of the 
unitary executive and expansive presidential control of the 
executive bureaucracy. We have reached the stage today where if 
the executive presumes without serious challenge from Congress 
that when Congress delegates rulemaking or other discretionary 
decision-making authority to agencies, it is also a delegation 
to the President, which allows him to freely control when and 
how that authority is to be executed.
    But there is some light in the tunnel to report. Due to the 
present and past leadership of this Subcommittee, attention has 
been given to the perceived flaws in the CRA.
    In 2006 and 2007, suggestions for at least a modest 
remediation of the perceived flaws in the CRA, if for no other 
reason than to maintain a credible congressional presence in 
the process of a delegated administrative lawmaking, were 
presented in a number of forums. These included hearings by 
this Subcommittee, a symposium held by the Congressional 
Research Service, CRS and GAO reports, and academic writings. 
Participating witnesses and panelists concurred that the role 
of Congress as the Nation's dominate policy maker was being 
threatened by widespread agency evasion of notice and comment 
rulemaking requirements and the frequent calls for increased 
presidential control of agency rulemaking.
    Most important, I believe, during this period was the 
catalogue of legislative options for remedying the flaws of the 
CRA presented in your Subcommittee's interim report on the 
administrative law project. Some of those options would not 
even require the passage of a law.
    Among the seven options suggested by the report, which 
could be explored today, include establishing a joint Committee 
by rule of each house to act as a clearinghouse and a screening 
mechanism for all covered rules; second, amending the CRA to 
limit it to review only of major rules; third, amending the act 
to make it clear that the failure to report a covered rule is 
subject to judicial enforcement; fourth, to amend the act to 
make it clear that an up or down vote is on the entire reported 
rule; and fifth, amend the act to clarify that a disapproved 
rule does not disable an agency from promulgating a rule in 
that area without further authorization from Congress.
    With that, I will conclude and await some questions. Thank 
you.
    [The prepared statement of Mr. Rosenberg follows:]

                 Prepared Statement of Morton Rosenberg





























    Ms. Sanchez. Thank you for your testimony, Mr. Rosenberg.
    At this time, I would invite Professor Katzen to present 
her testimony.

  TESTIMONY OF SALLY KATZEN, VISITING PROFESSOR, GEORGE MASON 
            UNIVERSITY SCHOOL OF LAW, WASHINGTON, DC

    Ms. Katzen. Thank you, Chairman Sanchez, Ranking Member 
Cannon, Members of the Subcommittee. I will try to summarize in 
my oral statement the written testimony.
    I would urge you, as you consider changes to the CRA, 
whether they be necessary or desirable, to keep in mind that 
the CRA was intended to serve an extraordinarily important 
function, namely, to reassert congressional accountability for 
what has become known as the administrative state.
    The broad delegations of authority from Congress to the 
agencies, which have been sanctioned by the courts and are now 
an integral part of our modern government, invariably 
diminished the power of Congress vis-a-vis that of the 
President. To address this balance and to reclaim 
accountability for the administrative state, Congress enacted 
the CRA.
    The Chairman noted that this was a bipartisan effort. It 
was passed by a Republican Congress and signed by a Democratic 
President. He signed the bill not because he had to, but 
because he wanted to. He saw it as a contribution to good 
government.
    Now, there are two major concerns that have been raised, 
one having to do with the administrative burden of the act--the 
costs--and questions about its efficacy--the benefits. Let me 
start with the latter.
    It has been noted that there have been very few joint 
resolutions of disapproval that have been introduced, and only 
has been enacted, and the low numbers are being used to show 
that the act doesn't work. But the numbers are also equally 
consistent with the notion that the act is working, and that 
the agencies have been doing a usually good job, faithfully 
performing their functions, especially knowing that Congress is 
looking over their shoulders.
    In fact, the congressional disapproval mechanism was not 
intended for the run-of-the-mill case. That was not its 
objective at the beginning, and I don't think it should be the 
test by which it is evaluated today.
    It was to be used only in those infrequent instances where 
there was such opposition to an agency rule that the Congress 
was willing to put aside its other work and to express its 
concern in an official way, knowing full well that the 
President, in most such cases, would choose to support the 
agencies and then veto the joint resolution.
    In any event, notwithstanding the paucity of instances 
where the joint motions or the joint resolution has been 
enacted, I firmly believe that the fact that the CRA requires 
agencies to send their rules to Congress before they take 
effect, and that there is an opportunity for Congress--in 
admittedly rare cases--to disapprove of the rule, serves as a 
real check on agency excesses, and, at a minimum, reasserts 
congressional authority. In other words, the CRA remains an 
effective watch dog even though it doesn't bark. GAO and CRS 
have subscribed to this position, to at least some extent, in 
the materials that I point out in the written testimony.
    I suggest in my written testimony that the burden on the 
parliamentarian and others could be reduced by authorizing or 
requiring agencies to submit their rules to Congress 
electronically, which is how they send them to the Federal 
Register. I stress, however, that all materials covered by the 
CRA should continue to be sent to Congress, not to the GAO, but 
to Congress, without any exceptions so that the agencies are 
aware of the fact that it is Congress to whom they are 
beholden, it is Congress which has given them the authority, 
and it is Congress which is the ultimate lawmaker in our 
government.
    For related reasons, I think it is important to retain the 
requirement that, once they are received by the Congress, they 
go to the Committees of jurisdiction, not be filtered through 
some intervening Committee, or ask the Committees to access 
some control database.
    These Committees are the ones that have the expertise and 
programmatic experience and, therefore, are in the best 
position to evaluate whether an impending rule is consistent 
with congressional intent. With electronic processing the 
burden on the parliamentarian would be reduced, but systematic 
and timely notice to the Committees would remain.
    A far more dramatic change, affecting substance rather than 
process, would be to redraw the coverage of the act. As you 
know, the CRA covers all rules because Congress has authority 
and has delegated that authority for all rulemaking. So the act 
covers the major rules, those generally having an annual affect 
of $100 million or more, and the thousands of non-major rules 
issued each year. I hope during the question and answer period 
I can address why Congress would not want to have to take an 
affirmative step with respect to those non-major rules.
    Limiting the scope of CRA to the more important rules would 
reduce congressional authority. But it would enable Congress to 
focus on the rules that have the greatest impact and are likely 
to be the most important rules. This is the tradeoff that was 
reflected in President Clinton's executive order whereby, OIRA 
no longer reviews all rules issued by executive branch 
agencies, but only the more important ones. We thought that if 
you try to do everything, you may not do anything very well.
    If Congress were to restrict the coverage of the CRA to 
major rules, there are, I think, two critical components that 
must accompany this. First, you should not use the major, non-
major dividing line which is currently set forth in the CRA. 
The definition of ``major'' in the CRA was taken from Executive 
Order 12291, which has not been in effect for 14 years. When 
President Clinton signed Executive Order 12866, the definition 
of major was encompassed in the term ``economically 
significant'' but there were three other categories that were 
added to significant. Those categories are important: 
materially affect the budget, novel issues, inconsistent 
actions that may be taken. If those are not included in the 
cutoff, Congress will be cutting off very important rules that 
it should be looking at. Now, these definitions of 
``economically significant'' and significant were not changed 
by President Bush. They have been in effect for over 14 years 
and I think have the acquiescence of both parties as the best 
criterion by which to determine what is really important. Or 
stated another way, if this is what OIRA uses to review 
executive branch agency rules, isn't this what Congress should 
use.
    In that same connection, I would note that as Ranking 
Member Cannon said, there is all this guidance out there. Well, 
recently the President amended the executive order so that OIRA 
would review that guidance. Again, if it is important enough 
for OIRA review, it should be subject to congressional review.
    The problem with the guidance documents is one that Mr. 
Rosenberg has addressed. Agencies are not sending them to the 
Congress. Therefore, I think it would be very salutory if there 
were changes in the language of the CRA to clarify the initial 
intention reflected in the legislative history, but these 
guidance documents and manuals, et cetera were intended to be 
covered.
    I see my time is up. I would love to talk about the section 
801(b)(2), which is the prohibition. I hope that we will be 
able to get to that during the question and answer period 
because I think it is a very important aspect for this act. 
Thank you very much.
    [The prepared statement of Ms. Katzen follows:]

                   Prepared Statement of Sally Katzen

    Chairman Sanchez, Ranking Member Cannon, and Members of the 
Subcommittee. Thank you for inviting me to testify today on the 
Congressional Review Act, 5 U.S.C. Sec. Sec. 801-08 (CRA). This Act was 
an important step toward reasserting Congressional accountability for 
what has become known as the ``administrative state.'' The Subcommittee 
is to be commended for convening a hearing, as it has in the past, to 
examine how the Act has been working in practice and consider whether 
modifications or clarifications of the law would enable it to better 
achieve its purposes.
    I served as the Administrator of the Office of Information and 
Regulatory Affairs (OIRA) at the Office of Management and Budget (OMB) 
for the first five years of the Clinton Administration, then as the 
Deputy Assistant to the President for Economic Policy and Deputy 
Director of the National Economic Council, and then as the Deputy 
Director for Management of OMB until January 2001. Among my 
responsibilities while I was Administrator of OIRA, I coordinated the 
Executive Branch views on the bills that became the CRA and, after its 
enactment, worked with the major executive branch regulatory agencies 
as they sorted through various implementation issues. I remain active 
in the area of administrative law, generally, and rulemaking, in 
particular. Since leaving government service, I taught Administrative 
Law and related subjects at George Mason University School of Law, the 
University of Michigan Law School, and the University of Pennsylvania 
Law School, and I have also taught American Government seminars to 
undergraduates at Smith College, Johns Hopkins University, and the 
University of Michigan in Washington Program. I frequently speak and 
have written articles for scholarly publications on these issues.
    The CRA was a bipartisan effort, passed by a Republican Congress 
and signed by a Democratic President. President Clinton signed the 
bill, not because he had to but because he wanted to. He saw it as a 
contribution to good government. See Statement on Signing the Contract 
with America Advancement Act of 1996 (Mar. 29, 1996) (available at 
http://www.presidency.ucsb.edu/ws/?pid=52611).
    It may be helpful to provide some background as context for this 
characterization of the CRA. Congress has, over the years, enacted 
legislation setting forth general principles or goals and then 
delegated to the agencies--typically executive branch agencies but 
independent regulatory commissions as well--the authority to develop 
and issue implementing regulations that have the force and effect of 
law. These often broad delegations of authority have been sanctioned by 
the courts and are now, by any measure, an integral part of our modern 
government. See, e.g., Whitman v. Am. Trucking Ass'ns, 531 U.S. 457 
(2001).
    One unintended consequence of the vast delegations to agencies was 
to significantly diminish the power of the Congress vis-a-vis that of 
the President. To reduce this shift in power, Congress has used various 
means to exercise authority over the administrative state. The Senate's 
role in advising and consenting to presidential appointments at 
regulatory agencies, oversight hearings by both the House and the 
Senate, and the power of the purse were all useful in this regard, but 
necessarily ad hoc, and the latter two strategies were almost always 
triggered after rules had gone into effect and their unintended or 
undesired consequences were more difficult to redress. One device used 
by Congress to retain close control of certain rules, which was used in 
nearly 200 hundred provisions, was the one- (or sometimes two-) House 
legislative veto, whereby the enabling legislation provided that any 
implementing regulations would be laid before the Congress and go into 
effect only if neither House objected. This form of oversight was 
eventually held unconstitutional in INS v. Chada, 462 U.S. 919 (1983).
    Thereafter, the absence of a systematic mechanism for Congressional 
oversight of the regulatory apparatus eventually led to the passage of 
the CRA. Unlike the one- (or two-) House legislative veto, the CRA is 
decidedly constitutional--meeting the presentment and bicameral 
requirements of Article I, Sec. Sec. 1 and 7, Cls. 2 and 3 identified 
in the Chada case. Also, the CRA was designed to be relatively 
efficient by, in effect, nullifying the Senate rules permitting a 
filibuster. Thus, with the CRA, if a majority in each House believes 
that a rule adopted by an agency is not faithful to Congressional 
intent or is otherwise deficient in a serious way, there is a ready 
vehicle for Congress to make its views known to the President.
    Some commentators and critics of the CRA have asserted that the Act 
is ``not working''--pointing to the relatively few Joint Resolutions of 
Disapproval that have been introduced and the fact that only one was 
enacted into law in the over ten-year history of the CRA. See CRS, 
Congressional Review of Agency Rulemaking: An Update and Assessment of 
the Congressional Review Act After Ten Years, RL30116, pg. CRS-1 (Mar. 
29, 2006) (hereinafter ``CRS Ten-Year Review''); Cindy Skrzycki, 
Reform's Knockout Act, Kept Out of the Ring, Washington Post, Apr. 18, 
2006, D01. Limited use of the disapproval resolution mechanism may be a 
manifestation that the Act is not working; it is, however, equally 
consistent with the notion that the Act is working and that agencies 
are usually faithfully performing their functions (especially knowing 
that Congress will be looking at their final work product--more on that 
below). In fact, the Congressional disapproval procedure was not 
intended to be used in the run of the mill case. Rather it was to be 
used only in those instances where there was such strong disagreement 
in Congress with what the agency did that Congress was willing to put 
aside other work and express its concern in an official way--knowing 
that in most such cases, the President would chose to support his 
agencies and thus veto the joint resolution. Stated simply, the 
disapproval process itself was intended to be used, and should be used, 
only when an agency's work product warrants the attention of Congress 
as a whole and is worth a confrontation with the President.
    Nonetheless, the fact that the CRA requires that agency rules must 
be sent to Congress before they can take effect, and that there is an 
opportunity for Congressional review which could--in admittedly rare 
cases--result in disapproval of a rule, operates as a real check on 
agency excesses, and at a minimum reasserts Congressional authority. 
The General Accountability Office (GAO) has previously testified that 
``the benefits of compiling and making information available on 
potential federal actions should not be underestimated.'' GAO, Federal 
Rulemaking: Perspective on 10 Years of Congressional Review Act 
Implementation, GAO-06-601T, pg. 4 (Mar. 30, 2006) (hereafter ``GAO 
Testimony''). It further suggested that ``the availability of 
procedures for congressional disapproval may have some deterrent 
effect.'' Id. The Congressional Research Service (CRS) describes the 
effect in somewhat more positive terms, such as ``exert[ing] pressure 
on the subject agencies to modify or withdraw the rule.'' CRS Ten-Year 
Review at CRS-8. In other words, the CRA remains an effective watchdog 
over agency rulemaking even when it doesn't bark.
    Having said that, there are ways to modify or clarify the Act to 
ensure that it captures the agency rules that it should capture and 
that it does so in a relatively efficient way. First, there are 
concerns about the administrative burden on the Parliamentarian (and 
others) resulting from the flood of paperwork that is generated by the 
Act's requirements. One way to alleviate this burden is to explicitly 
authorize agencies to submit their rules to Congress electronically, as 
they typically do when sending materials to the Federal Register for 
publication. This would obviously facilitate the processing of the 
information provided to Congress and would be in furtherance of the 
objectives of the ``E-Government Act of 2002,'' 107 P.L. 347, 116 Stat. 
2899, codified at 44 U.S.C. Sec. 101 (2007). The requirement for 
electronic submission should encompass all material covered by the CRA, 
without any exemption, including rules sent to the Federal Register. 
Keeping in place the requirement of 5 U.S.C. Sec. 801(a)(1)(A), that 
the agencies send their work product to Congress, keeps the agencies 
focused on the fact that it is Congress that delegates rulemaking 
authority to the agencies and it is Congress that is ultimately the law 
maker in our government.
    For related reasons, it is important to retain the requirement of 5 
U.S.C. Sec. 801(a)(1)(C) that, once the material is received by the 
Congress in electronic form, it should be forwarded to the committees 
of jurisdiction rather than leaving it up to the committees to access 
some central database. These are the committees that have the expertise 
and programmatic experience and are therefore in the best position to 
evaluate whether impending rules are consistent with Congressional 
intent. With electronic processing, the burden on the Parliamentarian 
would be reduced, but systematic and timely notice to the committees of 
agency actions within their jurisdiction would remain. Without such 
notice, the committees might not promptly focus on soon to be effective 
regulations, unless, of course, special interest groups alert them to 
potential problems. Given that the strength of the CRA is its 
comprehensive coverage, it is best not to leave committee awareness to 
happenstance.
    A far more dramatic change, affecting substance rather than process 
(but which is compatible with the suggestions above) would be to redraw 
the coverage of the Act. As noted above, the CRA was deliberately 
designed to cover all rules because Congress is the source of authority 
for all agency actions that affect the rights and obligations of the 
public. As a result, the CRA explicitly covers not only the ``major'' 
rules--generally those having an annual effect on the economy of $100 
million or more, 5 U.S.C. Sec. 804(2)--but also the many thousands of 
rules by which the agencies carry out the day to day responsibilities 
of government. A rough estimate is that there may be 50-100 major and 
2,000-3,000 non-major rules each year. Limiting the scope of the CRA to 
the more important rules would somewhat reduce Congressional authority, 
but it would enable Congress to focus on the rules that are likely to 
have the greatest impact on the public, and it would obviously greatly 
reduce the burden of sorting through the flood of less important rules 
that the Parliamentarian is currently receiving. This is the type of 
trade-off that was reflected in President Clinton's Executive Order 
12,866, 58 Fed. Reg. 51735 (1993), whereby OIRA limited its review of 
executive branch rules to those defined in the Executive Order as 
``significant.'' See EO Sec. 6(a)(3)(a). We believed that it was better 
to focus our limited resources on the more important rules, recognizing 
that if you try to do everything, you may not do anything well.
    If Congress were to decide to restrict the coverage of the CRA to 
the more important agency actions, there are two key, indeed critical, 
companion pieces that must be a part of any such change. First, 
Congress should most definitely not use the ``major''/``non-major'' 
dividing line as currently set forth in the CRA. The definition of 
``major'' in Sec. 804(2) of the CRA was taken from Executive Order 
12,291, 46 Fed. Reg. 13193 (1981), which has not been in effect for 
over 14 years. Executive Order 12,866, which replaced Executive Order 
12,291, used the term ``economically significant'' to capture much of 
what ``major'' encompassed, although there were several important 
changes: ``Major'' was defined in Executive Order 12,291 Sec. 1(b) as:

        any regulation likely to result in:

        1.  An annual effect on the economy of $100 million or more;

        2.  A major increase in costs or prices for consumers, 
        individual industries, Federal, State, or local government 
        agencies, or geographic regions; or

        3.  Significant adverse effects on competition, employment, 
        investment, productivity, innovation, or on the ability of 
        United States-based enterprises to compete with foreign-based 
        enterprises in domestic or export markets.

``Economically significant regulatory action'' (the short-hand term for 
those rules captured by Sec. 6(a)(3)(C)) is defined in Executive Order 
12,866 Sec. 3(f) as:

        any regulatory action that is likely to result in a rule that 
        may:

        1.  Have an annual effect on the economy of $100 million or 
        more or adversely affect in a material way the economy, a 
        sector of the economy, productivity, competition, jobs, the 
        environment, public health or safety, or State, local, or 
        tribal governments or communities

    Executive Order 12,866 Sec. 3(f) also added three other categories 
of ``significant'' regulations, namely, those that:

        2.  Create a serious inconsistency or otherwise interfere with 
        an action taken or planned by another agency;

        3.  Materially alter the budgetary impact of entitlements, 
        grants, user fees, or loan programs, or the rights and 
        obligations of recipients thereof; or

        4.  Raise novel legal or policy issues arising out of legal 
        mandates, the President's priorities, or the principles set 
        forth in this Executive order.

    The definitions of ``economically significant'' and ``significant'' 
regulatory actions have been in effect since 1993 and have not been 
changed in any way by President Bush. As a result, these are the 
operative definitions for review of executive branch rules by OIRA. If 
Congress were to limit its review of agency actions under the CRA to 
the more important rules, these definitions are the best criteria for 
determining the scope of the Act. Using these definitions would bring 
the number of rules covered under the CRA to several hundred a year--
still well below the number that are now sent to Congress, but 
presumably a manageable amount. More importantly, as noted, these are 
the criteria that OIRA uses for presidential review, and if a rule is 
important enough for presidential review, it should be subject to 
Congressional review.
    A related point is that if Congress were to decide to narrow the 
scope of the CRA, it should simultaneously clarify, in legislative 
language, that the CRA covers not only rules subject to the 
Administrative Procedure Act's notice and comment requirements, but 
also any interpretive rules, guidance documents, and other similar 
statements of policy that will have a future effect on the rights and 
obligations of the public. Making explicit that the CRA covers such 
agency actions--albeit only those that also fall within the definition 
of ``significant'' if that is made the test of coverage--would resolve 
any lingering doubts on the scope of the Act. Both the GAO and the CRS 
have opined that this is the correct interpretation of the CRA. GAO 
Testimony at 4 (``CRA contains a broad definition of the term `rule,' 
including more than the usual notice and comment rulemakings published 
in the Federal Register under APA''); CRS Ten-Year Review at CRS-24 
(``it was meant to encompass all substantive rulemaking documents--such 
as policy statements, guidances, manuals, circulars, memoranda, 
bulletins and the like--which as a legal or practical matter an agency 
wishes to make binding on the affected public''). Yet it is not 
altogether clear that this is how the agencies are reading the statute. 
Both GAO and CRS note that there are instances where agencies are not 
forwarding their work products to Congress, Id at CRS-40, with the GAO 
stating that when OIRA is notified of unfiled rules, agencies then file 
the rules ``or offer an explanation of why they do not believe a rule 
is covered.'' GAO Testimony at 4. In five of the eight cases where GAO 
was asked to follow-up on a non-filing, GAO said that the supposedly 
non-covered agency actions were, in GAO's opinion, within the scope of 
the CRA. GAO Testimony at 4-5. Clarifying in legislative language the 
intended breadth of the Act would be instructive to, and hopefully 
productive for, the agencies.
    There are two further observations on this point. First, for the 
reasons set forth above, Congress should ask GAO to send the list of 
unfiled rules that it currently sends to OIRA to the Congressional 
committees of jurisdiction as well. Second, as the Subcommittee will 
recall, earlier this year, President Bush amended Executive Order 
12,866 to bring within its scope significant agency guidance documents. 
See EO 13,422 Sec. 3, 72 Fed. Reg. 2763 (2007). Clearly the 
Administration believes that these documents warrant review by OIRA; 
again, at a minimum, anything that OIRA reviews should be subject to 
review by Congress.
    Finally, I would like to comment on Sec. 801(b)(2), which prohibits 
agency issuance of a rule ``in substantially the same form'' after 
passage of a joint resolution of disapproval unless Congress, by law 
subsequent to the disapproval resolution, authorizes the issuance of 
such a rule. Only one Joint Resolution of Disapproval has been enacted 
since the CRA became law, but the consequences of that disapproval are 
draconian--far more draconian than was originally intended. As CRS has 
noted, a disapproval resolution applies to the rule as a whole, which, 
as in the case of the ergonomics rule that was disapproved, can cover a 
vast area. CRS, Congressional Review of Agency Rulemaking: An Update 
and Assessment After Nullification of OSHA's Ergonomics Standard, 
RL30116, pg. 14-15 (Washington, D.C., Jan. 6, 2003). When the Bush 
Administration, which supported the disapproval resolution, went back 
to the drawing board and tried to craft a new rule that would pass 
muster with Congress, it concluded that it could not, under the CRA, 
draft any rule relating to ergonomics. If that view prevails--namely, 
that no new rule affecting the same subject matter can issue without 
new Congressional authorization--then there could well be an extended 
period of time where nothing could be done to deal with an admittedly 
serious problem so long as the agency's first attempt was unsuccessful. 
Yet, as CRS has noted, other provisions of the CRA, particularly the 
provision extending for one year any statutory or judicial deadlines 
for a rule that is disapproved, strongly suggest that the CRA was not 
intended to be a permanent bar. CRS Ten-Year Review at CRS-34-35. Nor 
was it so understood within the Administration when the bill was 
signed. The Subcommittee should therefore consider changing the 
prohibition so that it extends only for the duration of the Session (or 
of the Congress) during which the disapproval resolution was enacted. 
Agencies should be able to take a disapproved rule, fix it, and 
resubmit it at the next Session (or next Congress). The CRA would then 
have the salutary effect it was intended to have.
    This brings me back to where I started: CRA is good government. It 
reasserts Congress' legitimate role and responsibility for the 
administrative state. It is not an empty shell or mere formality--even 
if there are few disapproval resolutions filed or enacted. The point is 
that, with the CRA, the agencies are aware that Congress has an 
opportunity to review their work before it takes effect and that, on 
occasion, other sets of eyes and different minds will examine what the 
agencies have done and evaluate its consistency with the Congressional 
mandate by which it was authorized. In an age where divided government 
is more frequently the norm than the exception, there will sometimes be 
a different perspective coming from the Hill than from the other end of 
Pennsylvania Avenue. The CRA is an important way to ensure that those 
different perspectives are taken seriously.
    Thank you again for the opportunity to testify today. I look 
forward to answering any questions you may have.

    Ms. Sanchez. Thank you, Professor Katzen.
    We will now proceed to the rounds of questioning. And I 
will begin with Mr. Sullivan.
    Dr. Katzen has suggested that perhaps the CRA could be 
reformed to permit agencies to submit rules to Congress 
electronically. Is that a viable reform that could reduce 
paperwork and reduce the burden on the parliamentarian's 
office?
    Mr. Sullivan. Madam Chair, I think that would be a step. 
And as my colleagues have noted, my input to the Committee has 
been largely logistical on these things. But I am not here to 
whine about our workload.
    I wonder whether it would have any material effect on your 
effort to optimize the coverage and the effect of the act. I am 
not sure it would. Electronic wouldn't be hand trucks of boxes 
of documents.
    Ms. Sanchez. Right. I read your testimony about that. And I 
thought all that paperwork is probably----
    Mr. Sullivan. For a small operation like ours it is more 
significant than might meet the eye. And, you know, digital is 
better than analogue in that case. But I am not sure from the 
broader perspective from which my colleagues speak about the 
intention here.
    And we are talking about delegation of quasi-legislative 
power and what kind of strings should you attach to it, to the 
delegation itself or what kind of oversight mechanism should 
you array to make sure that it is prudently exercised. And I am 
not sure whether the streamlining by electronic submission 
affects that equation.
    Ms. Sanchez. Okay. What about considering eliminating the 
submission requirement in the CRA for non-major rules? Do you 
support that idea? And if you do, how would that impact the 
work----
    Mr. Sullivan. I would support anything--I am sorry.
    Ms. Sanchez. And if you do support that, how would that 
impact the workload in your office?
    Mr. Sullivan. I am not sure of what the numbers are between 
major and non-major. But I certainly would recommend anything 
that dealt with a more selective universe of rules. I think 
that would more focus the oversight.
    I start from the tenant that Congress doesn't need the CRA 
in order to disapprove a rulemaking. If Congress sees a bad 
rule, it can by act of Congress disapprove it. It doesn't need 
the CRA to do it.
    Now, sometimes there are needs to set up either an approval 
mechanism, an approval requirement saying we will give you a 
rulemaking power, but we have to approve it by act of Congress. 
So you can do the leg work for us, and then we will exercise 
the legislative power ourselves.
    The other option, the one taken by the CRA, is to provide 
some boost to the Congress' disapproval reaction, some 
expedition. But as it happens, the CRA doesn't expedite 
anything in the House. And in the end, all it does from the 
House's point of view is to facilitate vigilance, facilitate 
the vigilance that should go on. In the ordinary case, 
Committee council being experts in their jurisdiction keep an 
eye on the agencies for whom Congress has enabled rulemaking in 
their jurisdiction and a watchful eye on them.
    Now, perhaps merely facilitating vigilance has the kind of 
deterrent effect that my colleagues mentioned, that the 
agencies know that they are being watched more than they 
otherwise might. But that seems like a very marginal benefit to 
me.
    Ms. Sanchez. Thank you.
    Mr. Rosenberg, given the fact that there are these large 
volumes of information that are provided to Congress pursuant 
to the CRA and that that has only resulted in a limited number 
of joint resolutions of disapproval having been introduced and 
only one having succeeded, do you think that CRA is not working 
and should be repealed? Because Professor Katzen obviously 
feels that the argument can be made the other way. And I am 
interested in getting your opinion on that.
    Mr. Rosenberg. Not working because it is not--it is flawed 
in the way that it looks at the rules and the way it receives 
them. It doesn't receive enough information to start with. You 
get a report from GAO which simply says we have got a rule that 
has been in the Federal register. And it complies with all the 
executive orders and other rules in conformity.
    It doesn't deal with analysis of whether the rule is cost 
beneficial or would, you know, has been looked at for cost 
effectiveness or anything like that. That is the information 
that comes over and drops on a Committee.
    I don't know who it is in the Committees that do it, but my 
experience has been that a rule that is controversial, whether 
it is a major rule with an economic--tremendous economic impact 
or a lesser rule that, you know, impacts on constituents or 
small businesses or whatever it may be, it is only when 
somebody pokes the bear over here that you get some reaction to 
it.
    There is a need for a CRA if there is expedited review. 
There would be an even better reason for a CRA if there is 
expedited review in the House.
    A second thing is an information clearinghouse mechanism 
that provides the appropriate Committees with sufficient 
information on which to determine whether they should take some 
action, whether a joint resolution of disapproval should be 
filed in either house. If you had a concurrent, you know, 
expedited procedure, you would see an awful lot more out there.
    I tried to find anecdotal evidence of what Professor Katzen 
was saying, that, sure, it is having an impact. It must be 
because it is a wall. I looked at what has been happening the 
last 6, 10, 12, 14 years. There is less and less acquiescence, 
less and less cooperation between the executive branch and 
Congress with regard to oversight.
    You know, you have more than enough instances of refusals 
to provide access to information with regard to any kind of 
decision making and a refusal to obey subpoenas upon occasion 
without response by the Congress. There is a need for an 
effective CRA to keep Congress even.
    I mean, we are talking about separation of powers here. 
They used to call the old 122941, you know, in OIRA at that 
time the 800-pound gorilla in the house. I think it is 1,600 
pounds now with the kind of changes and the aggressive use of 
the executive order and the amendments to the executive order. 
I won't go on.
    Ms. Sanchez. Thank you, Mr. Rosenberg. My time has expired.
    I will now recognize my colleague, Mr. Cannon, for 5 
minutes.
    Mr. Cannon. Thank you, Madam Chair. You know, I couldn't 
help thinking of the imperial presidency, Mr. Rosenberg, as you 
were speaking about what I think you called the new 
presidentialism and what Professor Katzen later then called the 
administrative state. And so, we are sort of in this like 
remarkable hearing where our personal views--and I don't know 
that I--I am not sure I speak for the Chairman here, but I 
think I do and the panel members--have all transcended party 
and even branch and have said we have something, we have a 
problem we have to deal with.
    And I was telling some of the panel members before--and I 
think this story is actually important and maybe ought to go on 
the record. I have a constituent that has a service that is 
complicated and allowed by the IRS, but without particular 
guidance. And in a conference call in which my constituent was 
excluded but which many other people, 20 or 30 other people 
were on the conference call, a bureaucrat demeaned the 
constituent and said that they would never get guidance if he 
had his way.
    So I called the senior person in the general counsel's 
office and asked about it. And I had an interesting experience.
    He talked about their schedule for guidance papers. So what 
we have here is an environment of complex regulation where a 
personality can assert himself, maybe improperly. It appeared 
that way on the surface. Maybe it was not improper. We have a 
role for curbing individual antagonism. But the context of that 
role is law.
    In other words, we don't let people make decisions. We have 
a rule of law. And yet that rule of law can't take place 
because it has to be scheduled, and the person who may have had 
a problem with my particular constituent may actually have 
something to do with what gets scheduled or not. And in the 
meantime, business goes on.
    And so, we find ourselves with an administrative process 
that does not take into consideration the vast amount of 
activity that individual bureaucrats and cumulatively agencies 
have to participate in. And in that mix, I know that our 
parliamentarian has a huge burden. And we want to eliminate the 
paper part of that burden at least. But we are not in Congress 
in any way organized to even act consistently or coherently 
with OIRA.
    We put all the burden on a very small parliamentarian staff 
and virtually none on our Committee staff, as I think Professor 
Katzen had suggested where the burden ought to be. And 
therefore, the only oversight we have is the very inadequate 
oversight, which today is slightly better from what it was 
under the Republicans.
    I think one of the big mistakes Republicans made when they 
took over Congress is they decided to show the world that they 
could cut expenses. And so, we got rid of all of our oversight 
staff or virtually all of our oversight staff.
    And we have had significant arguments among ourselves as 
Republicans over that. But clearly, we have not done anywhere 
near the oversight. As the budget of government has doubled 
over the last 10 or so years, our oversight activity has 
diminished and only increased slightly under the new Democratic 
majority.
    So what we find ourselves is in a position of not doing 
oversight, of having laws developed, regulations developed or 
regulatory activities evolving through the activities of 
individuals without the kind of oversight that we need. So this 
hearing is dramatically important.
    And in that context, let me just ask. If you talk about the 
CRA, then we are talking about what we do with paperwork and 
what we do internally. But we are talking about the 
Administrative Procedure Act, don't we need to deal with that 
before we can actually deal with how Congress oversees 
effectively what we are doing in the Administration?
    And let me just put another question on the table, going 
back to the imperial presidency and whatever name we use for 
it. We have more judges, more adjudication that happens in the 
agencies than we have with Article 3 judges.
    And we have vastly more law than we produce here in 
Congress. Shouldn't we in Congress be thinking in terms of 
shrinking that, strengthen the presidency by taking more 
control, not just over regulations, but perhaps over 
administrative judges?
    And, Professor Katzen, would you mind responding first, and 
then we will move across the dais?
    Ms. Katzen. Trying to keep my answer brief, you raise some 
very important points. The APA is clearly relevant.
    The APA, the Administrative Procedure Act, which was 
written in 1946, deals with, for the most part--this is great 
simplification--the interaction between the agency and the 
public, what kind of input the public has and how the agency 
has to treat those comments. That is clearly relevant. But this 
is the other end of the process, which is having delegated the 
authority, what reins does the Congress want to keep on the 
agencies, and how does it manifest that?
    So, I think you can look at the CRA without looking at the 
APA, though I would encourage you to work on the APA because 
there are lots of issues there that warrant attention and, I 
think, updating.
    Having said that, the concept of review in this discussion 
that I find troubling in one major respect is that rules are 
not all the same.
    We talked ``major,'' and ``non-major.'' And I would beg of 
you to think ``significant,'' ``non-significant'' instead of 
``major,'' ``non-major'' for the reasons I explained. But even 
among the biggies and the little guys there are huge 
differences.
    The parliamentarian said he was not completely up to date 
on the numbers. It is roughly 50 to 100 ``economically 
significant'' rules a year, another 200 to 300 ``significant'' 
rules a year and 2,000 to 3,000 ``non-significant'' rules a 
year. But what are these non-significant rules? One of the ones 
that I know help populate the ``non-significant'' world are 
FAA, Federal Aviation Administration, air worthiness 
directives.
    Do you really want to stand between the FAA issuing an air 
worthiness directive to take a plane out of operation or to fix 
a screw or to change a motor or to reinforce a door and have it 
go through the--no, you want those rules to be able to 
function. Those are the routine elements of Congress.
    Setting the course----
    Mr. Cannon. I don't mean to mix your words, but----
    Ms. Katzen. Go ahead.
    Mr. Cannon. But this is really a vital issue that I would 
like to just--if the Chair would indulge me. The fact is you 
have to have guidance that can't go through Congress. But on 
the other hand, you want to have clarity about the process that 
develops the base rule.
    Don't we need to be more subtle in our thinking between 
what is guidance that is clearly guidance and which over time 
becomes formalized, so that you have the ability to set--as you 
suggested before the hearing, Congress doesn't set or review 
the times that we change for daylight savings time. The 
railroads, the other commissions do those sorts of detailed 
things.
    But ultimately when you make a decision about how the time 
should change, that may evolve actually into a rule that 
becomes part of a rule that is overseen. In other words, don't 
we need to deal with--we have a world that is so radically 
different. We have wickies today. That means we can accumulate 
and collaborate and develop a wisdom that is greater than any 
individuals and certainly than any bureaucrats.
    Don't we need to have some kind of process where we have 
clarity of decision on issues like screws and reinforcing doors 
and then on the other side, a cumulation of that process into a 
rule that we know has clarity? So you have certainty that you 
have to replace the screw. Then you have certainty about what 
the context of that replacing of the screw is because the 
larger rule goes through a process that is informed by each of 
the decisions that are more subtle.
    Ms. Katzen. Yes, in a word.
    Mr. Cannon. Thank you. And that seems to me to be the task 
of this Committee. I appreciate that.
    Ms. Sanchez. Were you finished with your response, 
Professor?
    And did anybody else on the panel want to comment to the 
question or comments that Mr. Cannon posed?
    Ms. Katzen. I guess I just would like to add that the 
reason I went through the FAA's air worthiness directives, 
which are rules, and all the other rules, is you can't talk 
about them as though they are the same thing. You have to go 
through the slicing and dicing and making those kinds of 
distinctions. And this discussion, which lumps it all together, 
is difficult to navigate.
    Mr. Rosenberg. Let us start with the APA and about amending 
it or doing something with it. APA is a very special law. It 
has been around since 1946 and, as Professor Katzen has noted, 
hasn't been amended. I think there have been, you know, little 
things here and there.
    APA is a special law that is like our Constitution except 
it is the Constitution for our administrative processes. It has 
stop signs, and it has protections, and it has due process 
concerns. And those remarkably, if you study the history prior 
to 1946 and the 8-year battle to get the APA passed, what you 
will see is the 1946 enactment has become a charter of the 
Constitution which has been amended, interpreted as time has 
changed.
    And it has morphed and tempered, you know, with help of the 
courts, sometimes with, you know, statutory, with imaginative 
devices that ACUS helped during its 28-year period. Those kinds 
of things helped it.
    I don't think we have to dive into it unless there is 
something egregiously wrong with the general public 
participation and reviewability and accountability provisions 
that are there now that have worked. What we have to look at is 
broader and look back on--it is dealing with Professor 
Katzen's--let us cut it down to significant rules.
    What determines what is a significant rule? You thought it 
was pretty significant with regard to your constituent.
    Mr. Cannon. And that is only guidance.
    Mr. Rosenberg. And that is guidance. But when a guidance--I 
have never understood the OMB new bulletin on guidance which 
says that they will review it if it has $100 million impact. 
Now, there may be a couple of guidances out there that some way 
or another have $100 million.
    But that seems to be treading very closely on what a rule 
is. If it has $100 million impact, to my mind, there is a 
presumption that perhaps there is something substantive about 
this that has an effect on persons outside the executive branch 
and outside the government and on private citizens if it has 
that much of an impact.
    What we are dealing with is--and remember what the CRA 
says. The CRA says that it is for--concerning what is a major 
rule, the only one who determines it is the OIRA administrator.
    Now, I don't know that we want OIRA and what it does to be 
the one that determines what is a significant rule that 
Congress might be interested in. I don't know how you can write 
a statute that says, you know, whatever OIRA is interested in 
we should be interested in it, too, and that has to be sent 
over somehow or another.
    I don't think you can give the power to a jurisdictional 
Committee, you know, in the statute to say they can point to a 
rule and say send it up. I think there may be a charter problem 
there.
    You know, and I don't think you have a choice of all the 
rules as there are now or specified rules and some other. 
Whoever determines whether it is a major rule or a significant 
rule that is important.
    Stepping back even further, we have got to be cognizant of 
the fact that there is a competition that is built into the 
Constitution between the President and Congress with respect to 
decision making in the executive branch. The fight since the 
New Deal, especially as more agencies have become more 
proliferous and also their powers have become more extensive, 
that the focus is on the agency, on agency decision making and 
who controls agency decision making.
    And over the last since the Reagan administration more and 
more agency decision making, particularly with regard to 
rulemaking has fallen into hands of the executive. I am not 
against executive, you know, review. I think it is beneficial 
and an important aspect of open government and also, you know, 
effective government and efficient government.
    But to the exclusion of Congress, the more Congress gets 
excluded from that decisional processes and unable to monitor 
and control and police the enormous amounts of delegated power, 
delegated lawmaking power it has given, I think we have to 
think about the future as, you know, it is not likely that any 
President in the future is going to accept less of power than 
has been claimed and asserted, you know, during the last 6, 8 
years or 12 years and even during the Clinton administration.
    Mr. Cannon. Madam Chair, would you indulge me to just 
follow up on clarifying one point?
    Ms. Sanchez. I will, although we have gone way over time 
with your questioning. I will grant you an additional minute. 
We are also expecting votes.
    Mr. Cannon. I thank the Chair.
    Ms. Sanchez. And I do want to allow Mr. Johnson an 
opportunity to ask questions.
    Mr. Cannon. Certainly. I apologize to Mr. Johnson in 
advance here.
    If I could restate what I think you are saying, Mr. 
Rosenberg, the APA is important because like the Constitution, 
it is based on principles. And those principles haven't 
changed. And they won't change.
    My concern is that the context in which we are applying 
those principles has changed dramatically. So the number of 
decisions being made, the number of people at lower and lower 
levels making decisions which may or may not be significant to 
OIRA but may be significant to a business ought to be captured 
somehow with the new tools that are available to capture those. 
So I have never advocated a throwing out and redoing of APA, 
only of updating it on the margins. And is that consistent with 
what you are suggesting?
    Mr. Rosenberg. Context does not override basic principles, 
whether it is the principles that underlie the APA or the 
principles that underlie the separation of powers.
    Mr. Cannon. Exactly.
    Mr. Rosenberg. Undermining them, undermining the ability of 
Congress to be the prime policy maker in the separation of 
powers is dangerous.
    Mr. Cannon. I think we agree entirely. The question is 
don't we have tools today, and don't we have a need because of 
the growth of government and decision makers within government 
to use new tools to help make the principles of the APA 
applicable at increasingly low levels of government.
    Mr. Rosenberg. If you are thinking the CRA is a tool, it is 
an ineffective tool. If it was amended and made effective so 
that Congress can be more accountable about its delegations and 
also assure that there is transparency and there is 
accountability in the executive, yes, that is fine. That is 
creating new tools, you know, to accomplish those basic, you 
know, constitutional and administrative law, you know, precepts 
and protecting them----
    Ms. Sanchez. The time of the----
    Mr. Rosenberg [continuing]. Will be very beneficial.
    Ms. Sanchez [continuing]. Gentleman has expired.
    Mr. Cannon. Thank you, Madam Chair. I yield back.
    Ms. Sanchez. And I will recognize Mr. Johnson for 5 minutes 
of questions.
    Mr. Johnson. Thank you, Madam Chair. I will try my best to 
come up with 5 minutes worth of material. I will say that I 
stayed awake last night pondering the realities of this 
information that we are receiving today and tried my best to 
engender some type of enthusiasm. And I was woefully unable to 
do so.
    Mr. Cannon. If the gentleman will yield, he has chosen the 
right Committee.
    Mr. Johnson. I am very impressed that my friend, Mr. 
Cannon, has been completely successful at being enthusiastic 
about it. So my hat is off to you, sir. And you are welcome to 
utilize another 10 minutes of my time that I will probably----
    Mr. Cannon. As long as the gentleman will not go to sleep 
during that period.
    Mr. Johnson. It was recently reported that because the 
Administration has been frustrated by the legislative process, 
Mr. Rosenberg, that the President has endeavored to achieve 
policy objectives through executive orders or agency 
rulemaking. What reforms to the CRA are the most important in 
strengthening congressional oversight of agency rulemaking?
    Mr. Rosenberg. First, having an adequate screening 
mechanism with respect to rules, whatever which ones are going 
to be reported, whether they are all the rules, the major 
rules, significant rules, whatever they are. It needs to be a 
mechanism that--and one particular model is a joint Committee 
that is not a substantive, not a legislative Committee, but a 
Committee from both houses that receives the rules, has an 
ability to look at them in-depth, to get help, let us say, of 
GAO to do cost benefit, cost effectiveness analysis, any other 
analysis necessary so that a judgment can be made by a joint 
Committee with respect to rules they find significant, that 
then recommends them to the jurisdictional Committees; second, 
a process, a coordinate process of expedited consideration in 
the House, both houses; third, dealing with certain 
interpretative flaws that are in the CRA.
    I think it wouldn't be destructive or threatening to the 
executive. It would put back on a par that is probably 
necessary for the maintenance of the separation of powers.
    Mr. Cannon. Would the gentleman yield?
    Mr. Johnson. Yes.
    Mr. Cannon. In that scenario, Mr. Rosenberg, would you 
suggest that perhaps if the Committee of jurisdiction decides 
that there is a problem with the rule that it can hold that 
rule from going into effect during some sort of a legislative 
deferral to rules and therefore, having a bigger bite with the 
agency?
    Mr. Rosenberg. Are you saying to have a----
    Mr. Cannon. Some way to have a holdup on a rule.
    Mr. Rosenberg. A mini-veto?
    Mr. Cannon. Yes, based upon a majority of a Committee. In 
other words, what would you do to give teeth to Congress over 
the rules that come to us?
    Mr. Rosenberg. Well, you can't give them legislative veto 
powers. In other words, you can't have these rules unless you 
make all rules recommendatory and have a fast track process for 
taking care of 99.9 percent of them and filtering them through. 
That is not likely to receive, you know, blessing either here 
in the House or certainly not by the President.
    Mr. Cannon. You think the President would veto that idea?
    Mr. Rosenberg. I think he would laugh his way to the veto 
table.
    Mr. Cannon. He might laugh his way into an override.
    Mr. Rosenberg. I don't think there could be--no, but I 
think that a mechanism that--and the joint Committee is one 
that I think has a political efficacy, too. You are not 
impinging on the jurisdictions of the Committee's in both 
houses.
    What you are doing is having recommendations which then can 
be acted upon in an expeditious way. That could be frightening. 
That would truly be frightening to, you know, the agencies. 
They would take notice.
    I mean, preferably we know that the agencies are between a 
rock and a hard place between OMB and OIRA and jurisdictional 
Committees. But if the choice be made nowadays in the last 
decade or more, they are going to do what OIRA and OMB says.
    Mr. Cannon. Madam Chair, I note that the time has expired. 
But I think that Professor Katzen would like to respond. And 
so, I ask unanimous consent that the gentleman's time be 
extended so that she can respond.
    Mr. Johnson. Thank you. I was just getting ready to reclaim 
what little time I had.
    Ms. Sanchez. Mr. Johnson, Mr. Cannon ate up all your time. 
I just want that noted for the record. In the future you might 
be a little more judicious about how many minutes you do yield 
to him.
    Mr. Cannon. And Mr. Johnson didn't go to sleep. This is an 
amazing hearing.
    Ms. Sanchez. Professor Katzen, you will be allowed to 
answer.
    I just want to advise Members we have been called across 
the street to vote. We do need to wrap up the hearing.
    So if you could be brief, we would appreciate that.
    Ms. Katzen. I will try, although there has been a lot said 
that I think is far more complicated. A joint Committee is 
something, notwithstanding my enormous respect for Mr. 
Rosenberg, that I am very dubious about. Think about who signs 
up for such a Committee. Think about who does the work on such 
a Committee.
    Ms. Sanchez. Probably Mr. Cannon and not Mr. Johnson.
    Ms. Katzen. I am not sure Mr. Cannon would be happy looking 
at 4,000 rules each year, which is why I say the Committees of 
jurisdiction are the ones that have the expertise and the 
experience to recreate that, or I should say to attempt to 
recreate that in a new joint Committee would be, I think, to 
create another bureaucracy. And I ordinarily don't use the 
``b'' word as a bad word. But in this instance, there would be 
a layering effect that will not provide the institutional 
benefits that you might otherwise want to have.
    With respect to expedition, having participated into the 
wee hours of the morning in negotiating the CRA back in 1995, I 
can tell you there was not one whit of concern about the House. 
If the leadership of the House wants to bring something up, it 
has the ability to do it. The problem has always been the 
Senate.
    And what the CRA did--and I know I am speaking on the House 
side, not the Senate side--but please believe me that what the 
CRA does is bypass the possibility of filibuster, and that was 
enormous. It was monumental. It was not swallowed easily by the 
Senate. It was incredibly significant. I don't think you have 
to change the rules in the House to achieve any kind of result 
like that.
    In terms of the clarifications, I would join Mr. Rosenberg 
there. I think it is not clear that it is extant to the kinds 
of guidance documents that have been stipulated. And the 
agencies are not sure of it.
    I would, as a matter of personal privilege having served as 
administrator of OIRA for 5 years, take exception to the 
characterization of who decides what is ``significant'' and 
whether that is a good place to be. And I would like to engage 
with the Committee on the process that OIRA uses. And it is not 
purely subjective, and we are not hiding the ball. We are not.
    How could I say we? It has been over 10 years since I 
served in that capacity. But as an institution, OIRA doesn't 
try to hide the ball on that. So it strikes me that one has to 
take some of the things you have heard today with just a tiny 
grain of salt.
    Ms. Sanchez. Thank you. And I want to thank all of the 
witnesses for their testimony today.
    Without objection, Members will have 5 legislative days to 
submit any additional written questions which we will forward 
to the witnesses and ask that you answer as promptly as you can 
so that they can be made a part of the record. Without 
objection, the record will remain open for 5 legislative days 
for the submission of any additional material.
    And I want to thank again our panelists for their time and 
their patience. And this hearing on the Subcommittee of 
Commercial and Administrative Law is adjourned.
    [Whereupon, at 3:04 p.m., the Subcommittee was adjourned.]


                            A P P E N D I X

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               Material Submitted for the Hearing Record

Answers to Post-Hearing Questions from the Honorable John V. Sullivan, 
Parliamentarian, United States House of Representatives, Washington, DC





                                

 Answers to Post-Hearing Questions from Mort Rosenberg, Specialist in 
  American Public Law, Congressional Research Service, Washington, DC





                                

     Answers to Post-Hearing Questions from Sally Katzen, Visiting 
    Professor, George Mason University School of Law, Washington, DC









                                 
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