[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]



 
      REDUCING RED TAPE: THE NEW OIRA ADMINISTRATOR'S PERSPECTIVE

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



                                HEARING

                               before the

                      COMMITTEE ON SMALL BUSINESS

                             UNITED STATES

                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                               __________

                              HEARING HELD

                             JULY 24, 2013

                               __________

                               [GRAPHIC] [TIFF OMITTED] 
                               

            Small Business Committee Document Number 113-032

              Available via the GPO Website: www.fdsys.gov




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                   HOUSE COMMITTEE ON SMALL BUSINESS

                     SAM GRAVES, Missouri, Chairman
                           STEVE CHABOT, Ohio
                            STEVE KING, Iowa
                         MIKE COFFMAN, Colorado
                       BLAINE LUETKEMER, Missouri
                     MICK MULVANEY, South Carolina
                         SCOTT TIPTON, Colorado
                   JAIME HERRERA BEUTLER, Washington
                        RICHARD HANNA, New York
                         TIM HUELSKAMP, Kansas
                       DAVID SCHWEIKERT, Arizona
                       KERRY BENTIVOLIO, Michigan
                        CHRIS COLLINS, New York
                        TOM RICE, South Carolina
               NYDIA VELAZQUEZ, New York, Ranking Member
                         KURT SCHRADER, Oregon
                        YVETTE CLARKE, New York
                          JUDY CHU, California
                        JANICE HAHN, California
                     DONALD PAYNE, JR., New Jersey
                          GRACE MENG, New York
                        BRAD SCHNEIDER, Illinois
                          RON BARBER, Arizona
                    ANN McLANE KUSTER, New Hampshire
                        PATRICK MURPHY, Florida

                      Lori Salley, Staff Director
                    Paul Sass, Deputy Staff Director
                      Barry Pineles, Chief Counsel
                  Michael Day, Minority Staff Director


                            C O N T E N T S

                           OPENING STATEMENTS

                                                                   Page
Hon. Sam Graves..................................................     1
Hon. Nydia Velazquez.............................................     2

                                WITNESS

Hon. Howard Shelanski, Administrator, Office of Information and 
  Regulatory Affairs, Office of Management and Budget, 
  Washington, DC.................................................     3

                                APPENDIX

Prepared Statement:
    Hon. Howard Shelanski, Administrator, Office of Information 
      and Regulatory Affairs, Office of Management and Budget, 
      Washington, DC.............................................    17
Questions and Answers for the Record:
    Questions and Answers submitted by Hon. Sam Graves to Hon. 
      Howard Shelanski...........................................    22
    Questions and Answers submitted by Hon. Chris Collins to Hon. 
      Howard Shelanski...........................................    27
    Questions and Answers submitted by Hon. Richard Hanna to Hon. 
      Howard Shelanski...........................................    27
    Questions and Answers submitted by Hon. Tim Huelskamp to Hon. 
      Howard Shelanski...........................................    28
    Questions and Answers submitted by Hon. Donald Payne to Hon. 
      Howard Shelanski...........................................    31
Additional Material for the Record:
    Memo from Richard Ginman, Director, Defense Procurement and 
      Acquisiton Policy..........................................    31


      REDUCING RED TAPE: THE NEW OIRA ADMINISTRATOR'S PERSPECTIVE

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                        WEDNESDAY, JULY 24, 2013

                  House of Representatives,
               Committee on Small Business,
                                                    Washington, DC.
    The Committee met, pursuant to call, at 1:00 p.m., in Room 
2360, Rayburn House Office Building. Hon. Sam Graves [chairman 
of the Committee] presiding.
    Present: Representatives Graves, Chabot, Luetkemeyer, 
Hanna, Huelskamp, Schweikert, Collins, Rice, Velazquez, Chu, 
Hahn, Meng, Schneider, and Barber.
    Chairman GRAVES. Good afternoon, everybody. We will call 
this hearing to order.
    I am very pleased today to welcome Howard Shelanski, who is 
the new administrator of the Office of Information and 
Regulatory Affairs. The Office of Information and Regulatory 
Affairs is charged with the critical role of reviewing 
significant regulations and overseeing agencies' review of 
existing regulations.
    Over the last four years, regulatory burdens have increased 
at an astonishing rate, and major rules alone have added nearly 
70 billion in new regulatory costs. In fiscal year 2012, more 
than 3,800 final rules were issued. While expanding the 
regulatory state in an unprecedented way, President Obama has 
also directed federal agencies to review their existing 
regulations. He issued two executive orders--one in 2011 that 
required agencies to draft and finalize retrospective review 
plans, and another in 2012 that requires federal agencies to 
produce retrospective review progress reports. Agencies were 
ordered to give special consideration to initiatives that would 
reduce regulatory burdens on small businesses. This makes sense 
because small businesses are disproportionately burdened by 
regulatory costs. Furthermore, in survey after survey, small 
businesses regularly cite concerns about the complexity and 
burden of red tape. The need to reevaluate our regulatory 
structure is clear.
    Last week in The Washington Post, there was a story that 
ran on the front page about a magician from my home state of 
Missouri. This magician uses a Netherland dwarf rabbit in his 
magic shows for kids and the Department of Agriculture has 
determined that the magician must carry a license for his 
rabbit, pay an annual fee, and submit to surprise inspections 
of his home. In addition, under a new rule finalized just last 
year, he is required to have a written plan detailing how he 
will take care of the rabbit in the event of an emergency or 
disaster. This rabbit disaster plan, which is being prepared 
with professional assistance, is 28 pages long so far.
    If this story was not on the front page of the newspaper I 
would have thought it was a joke, but this is no laughing 
matter. This kind of story about regulatory overreach is 
unfortunately all too common today. Congress gives regulators 
an inch and a lot of times they do take a mile and the result 
is poorly thought out, unnecessary regulations that unduly 
burden small businesses.
    Today, Administrator Shelanski has joined us to discuss 
agency retrospective review efforts, and I look forward to 
hearing whether the agencies' efforts are resulting in 
meaningful reductions in regulatory burdens, particularly for 
small businesses. And I also look forward to hearing how Mr. 
Shelanski plans to scrutinize new regulatory proposals to 
ensure that any negative impacts on small businesses are 
minimized.
    And with that I turn to Ranking Member Velazquez for her 
opening statement.
    Ms. VELAZQUEZ. Thank you, Mr. Chairman.
    Small businesses are critical to the economy, creating 
nearly 70 percent of net new jobs and generating more than 50 
percent of GDP. While their contributions are essential to 
putting a real dent in the nation's unemployment rate, 
regulatory costs threaten to undermine this important role. 
While credible estimates of these costs are hard to come by, 
over the last seven years this committee has extensively 
examined the impact of regulations on small firms. During this 
time, it has become clear that although these rules provide 
significant benefits to the public, they are, in fact, creating 
very real challenges for a wide range of smaller companies.
    President Obama addressed this matter head-on by issuing 
Executive Orders 13563 and 13610. Together, these mandates have 
the potential to bring real relief to small businesses across 
the country. They call for the careful reassessment--a 
retrospective analysis--of regulations that are in place. After 
this evaluation has been undertaken, agencies will be in a 
position to streamline, modify, or eliminate rules that do not 
make sense in their current form or under existing 
circumstances. Specifically, agencies are directed to 
prioritize initiatives that will produce significant cost 
savings and reductions in paperwork burdens. As a result, small 
businesses will face fewer headaches in dealing with federal 
regulations.
    In May, this committee heard from agencies on their 
progress in implementing these orders. We learned for the most 
part that agencies are taking these requirements more seriously 
than they have in the past, particularly when it comes to the 
section 610 requirements in the Regulatory Flexibility Act. 
Several agencies, from Treasury to Labor to DOT, have already 
issued final rules that will reduce burdens on businesses. 
Other changes, like those to the FAR, will help small 
businesses directly by reducing government bureaucracy.
    During today's proceedings, I am particularly interested in 
hearing whether these moves indicate a long overdue change to 
agency behavior. All too often, similar efforts have been just 
a flash in the pan as agencies' compliance with previous calls 
for regulatory reduction faded quickly.
    While the president's initiatives are welcome, we cannot 
overlook the importance of the Regulatory Flexibility Act as 
well. It has provided an overarching structure for agencies to 
work within, limiting the impact of their rules on small 
businesses. With efforts currently underway in the Judiciary 
Committee to revise this important statute, we must ensure that 
any changes do not undermine its effectiveness. This means not 
heaping on the SBA's Office of Advocacy--who implements the 
RFA--with responsibilities beyond its capacity. As a result of 
the sequester, this office is already struggling to make due 
with less and adding more duties makes little sense. The truth 
is that taxpayers will be stuck with another bill or more 
likely no additional funding will be provided and the office 
will be unable to carry out these obligations effectively.
    Instead, we should be considering changes to the RFA in the 
area that are most glaring, rather than rewriting the entire 
act. This includes ensuring periodic reviews become a regular 
part of the regulatory process and that agencies cannot evade 
their responsibility under the act. It also means broadening 
the panel process, but in a way that makes sense in the current 
fiscal environment.
    With Administrator Shelanski here today, I am eager to not 
only hear about agency implementation of the retrospective 
review plans, but also what step, if any, should be taken to 
improve the RFA. Reducing regulatory burden is a laudable, if 
elusive, goal. It is something that Congress, the 
administration, and the private sector must work towards and 
constantly improve as the regulatory environment evolves. With 
this in mind, I am hopeful that these most recent executive 
orders will be a break from past efforts. Reversing these 
trends are essential, not only to small business, but to the 
economy overall.
    I yield back the balance of my time. Thank you.
    Chairman GRAVES. Thank you.
    The Honorable Howard Shelanski was confirmed as the 
administrator of the Office of Information and Regulatory 
Affairs on June 27, 2013. Mr. Shelanski has both a Ph.D. in 
Economics and a law degree from the University of California at 
Berkeley. He served in several positions at the Federal Trade 
Commission, most recently as the director of the Bureau of 
Economics. Mr. Shelanski has worked for the Federal 
Communications Commission and the Council of Economic Advisors 
at the White House, and he has also taught and practiced law 
and clerked for several notable jurists, including Supreme 
Court Justice Scalia.
    Mr. Shelanski, thank you for taking the time to be here. 
Your written testimony will be entered into the record in its 
entirety, and I look forward to hearing your oral testimony.

    STATEMENT OF HOWARD SHELANSKI, ADMINISTRATOR, OFFICE OF 
 INFORMATION AND REGULATORY AFFAIRS, OFFICE OF MANAGEMENT AND 
                             BUDGET

    Mr. SHELANSKI. Thank you very much, Mr. Chairman, Ranking 
Member Velazquez, and members of the Committee. Thank you for 
the opportunity to appear before you today.
    As Chairman Graves just mentioned, I was recently confirmed 
as the administrator of the Office of Information and 
Regulatory Affairs, known as OIRA, at the Office of Management 
and Budget, and I am honored to be serving in this role. And I 
look forward to speaking with you today about the topic of 
retrospective regulatory review, and in particular, its 
benefits for small businesses.
    Retrospective review is critical to ensuring that our 
regulatory system is modern, streamlined, and does not impose 
unnecessary burdens on the American public. Even regulations 
that were well crafted when first promulgated can become 
unnecessary over time as conditions change. Retrospective 
review of regulations helps to ensure that those regulations 
are continuing to promote health, safety, welfare, and well-
being of Americans without imposing unnecessary costs.
    Recognizing the importance of this effort, in January 2011, 
the president issued executive order 13563, called ``Improving 
Regulation and Regulatory Review.'' Among other things, that 
executive order asks executive departments and agencies to 
review existing regulations and to streamline, modify, or 
repeal regulations and reduce unnecessary burdens and costs. As 
a result of that executive order, executive departments and 
agencies produced more than two dozen plans with over 500 
regulatory reform initiatives. Just a small fraction of the 
rules already finalized will produce billions of dollars of 
savings in the near term. In subsequent executive orders, the 
president took the additional steps of directing agencies to 
emphasize reforms that produce significant, quantifiable 
savings, and of asking the independent regulatory agencies to 
develop their own regulatory review plans.
    The administration's retrospective review efforts are 
already producing significant results. For example, the 
Department of Health and Human Services (HHS) finalized rules 
to remove unnecessary regulatory and reporting requirements on 
hospitals and other health care providers, saving more than $5 
billion over the next five years. The Department of Labor 
finalized a rule to simplify and to improve hazard warnings for 
workers, producing net benefits of more than $2.5 billion in 
savings over the next five years while increasing safety. The 
Department of Labor also finalized a rule that will remove 
approximately $1.9 million annual hours of redundant reporting 
burdens on employers, and save more than $200 million in costs 
over five years. The Environmental Protection Agency finalized 
a rule to eliminate the obligation for many states to require 
air pollution vapor recovery systems at local gas stations 
since modern vehicles already have effective air pollution 
control technologies. The anticipated five-year savings are 
over $400 million.
    Our retrospective review efforts have focused especially on 
benefitting small businesses. The Department of Transportation 
retrospective review plan alone identifies over two dozen 
initiatives to save money for small businesses and local 
governments. For example, one of DOT's initiatives would codify 
regulations to prevent duplicative requirements for air carrier 
drug and alcohol testing programs, which would be particularly 
helpful for small carriers. The Department of Defense issued a 
new rule to accelerate payments on contracts to as many as 
60,000 small businesses, improving their cash flow. And the 
Small Business Administration is changing its rules to adopt a 
single electronic application to reduce the paperwork required 
of certain lenders, which will in turn benefit small business 
borrowers.
    This past winter, agencies focused their retrospective 
review updates on paperwork burden reduction. Many of the 
initiatives stemming from this effort will save substantial 
money for small businesses. For example, the Internal Revenue 
Service announced a simplified method for claiming the home 
office deduction, which will save taxpayers, particularly those 
with home-based small businesses, over 1.6 million hours and 
several million dollars in out-of-pocket costs per year.
    In July 2013, agencies submitted to OIRA their latest 
updates of their retrospective review plans pursuant to 
executive orders 13563 and 13610. Although OIRA is still 
reviewing the plans and the full updates are not yet public, I 
can report that many of the initiatives highlighted in the 
updated plans benefit small businesses. For example, the 
Department of Housing and Urban Development is drafting a final 
rule that would create alternative, more streamlined financial 
statement reporting requirements for small supervised lenders. 
The rule would also eliminate duplicative reporting 
requirements for lenders who already report to federal 
agencies. In addition, the Federal Aviation Administration is 
proposing a rule to update, simplify, and streamline rules of 
practice and procedure for filing and adjudicating complaints 
against federally assisted airports. Small businesses would 
particularly benefit from this rule which would decrease the 
time spent on processing complaints by allowing parties to file 
electronically.
    Retrospective review is crucial to ensuring that we have a 
well-functioning regulatory system, and moving forward I will 
look for further ways to institutionalize retrospective review 
of regulations and to ensure that retrospective review 
continues to produce significant cost savings for small 
businesses and for the American people.
    Thank you for your time. I would be happy to answer any 
questions.
    Chairman GRAVES. Thank you very much, Administrator.
    We are going to start with Representative Luetkemeyer. You 
can start with questions.
    Mr. LUETKEMEYER. Okay. Thank you, Mr. Chairman. And thank 
you, Mr. Shelanski, for being here today.
    I have a few questions here with regards to the Department 
of Labor is coming out with some rules and has been coming out 
with some rules and I am going to kind of use those as perhaps 
a template for how you go about your rulemaking process here.
    In 2010, they came out with a rule with regards to broker-
dealers and investment advisors and they withdrew the rule 
again in 2011. I do not know if you are familiar with it or not 
but it had to with the liability exposure, that they could be 
exposed to as a result of this rule with regards to the broker-
dealers and investment advisors, how they advised their 
clients. And now it is DOL's intent to repropose the rule. In 
fact, you may have the rule already to review because they were 
going to try to deal with it in 90 days. You have to have it 
within 90 days of the rule being implemented and they are 
trying to get it by the first of October. So you may have it 
already, I am not sure. But regardless, I guess my concern is, 
number one, since they pulled the rule back and they are now 
going to repropose it, I assume you will get it before they do 
come out with a final ruling. Is that correct?
    Mr. SHELANSKI. Yes, sir. That is correct.
    Mr. LUETKEMEYER. Okay. And they have to go through the 
entire process of showing a cost-benefit analysis, what kind of 
problem is there to solve, what their solution is. That is all 
part of the regular process of going about this; is that 
correct?
    Mr. SHELANSKI. Yes. So the review process at OIRA is very 
much exactly what you just described. When the regulation comes 
to OIRA for review, one of the jobs of the office is to make 
sure that the prescriptions of the relevant executive orders 
have been followed. And one of the, I think, centerpieces of 
the executive orders under which OIRA operates is cost-benefit 
analysis. And so any rule that comes to OIRA, whether it will 
be the reproposed fiduciary or any other regulation, where 
allowable by law will be subject to this kind of cost benefit.
    Mr. LUETKEMEYER. Okay. Whenever they give you the cost-
benefit analysis, do you look at it and ever tell them, ``Hey, 
this is a bunch of bunk. You guys are all blowing smoke at us. 
This does not work. I want you to go back and actually do an 
analysis that makes sense?''
    Mr. SHELANSKI. This is, in fact, very much at the heart of 
what OIRA does. OIRA does not in the first instance do original 
cost-benefit analysis. It reviews what the agencies have done, 
but it reviews it rigorously and critically so information can 
emerge during the OIRA review process that suggests either that 
the cost-benefit analysis was inadequate or should be done in a 
different way, or as in many cases, that it was, in fact, done 
very well. But OIRA does adopt a very critical analysis of 
that.
    Mr. LUETKEMEYER. Okay. In this situation there also is a 
situation here where the SEC is trying to also make a rule 
under a different structure, under different guidelines, 
different authority, and the two rules could be in conflict and 
there needs to be some collaboration here. Do you force them to 
collaborate? What happens when they are in conflict with each 
other?
    Mr. SHELANSKI. Mr. Luetkemeyer, thank you very much for 
that question because I think that gets to a very important 
issue. I absolutely share your concern and OMB shares your 
concern with duplicative or conflicting regulations. And one of 
the very important roles of OIRA, in addition to reviewing what 
the agency analysis is, is where appropriate to convene other 
agencies that might have duplicative or conflicting rules.
    Mr. LUETKEMEYER. So do you get them in a room and say, 
okay, you guys knock it out? Or do you reject both rules and 
tell them to do it over? How do you get to some sort of 
resolution here?
    Mr. SHELANSKI. Well, there are different processes 
depending on the circumstance. The Securities and Exchange 
Commission is an independent agency and not subject to OIRA 
review. But of course, the Department of Labor is.
    Mr. LUETKEMEYER. What rules are going to have an impact on 
what you review.
    Mr. SHELANSKI. Precisely. I agree with you completely.
    And so the job of OIRA, and my job as administrator in that 
case, would be to make sure that the Department of Labor, which 
is subject to OIRA review, is fully taking account the extent 
to which its rules will overlap or interoperate with the 
Securities and Exchange Commission's rules.
    Mr. LUETKEMEYER. Okay. With regards to looking at the 
promulgation of rules, do you ever look at the letters and the 
testimony, the comment period, all the stuff that comes in to, 
in this case, DOL or whomever, and say this is an unintended 
consequence of what you are trying to do. This is what is going 
to happen if you do this. And to follow up because I am running 
out of time here, do you also look at, in a case of 
promulgating rules from a law, do you ever look at the intent 
of Congress and what we are trying to get done with this law 
and the hearings that we have here and the testimony and the 
discussions held on the floor as an indication of where we want 
to go with this law so that when they make the rules they do 
not take a turn somewhere and go off on a tangent and make sure 
they stay within the case I call it, or where they need to be 
to make these rules?
    Mr. SHELANSKI. So let me answer your questions, starting 
with the one you just asked because I think it is a very 
important question.
    The interpretation of an agency statute and the choice of 
policy to the extent there is discretion under that statute is 
in the first instance in the province of the department or 
agency that is issuing the regulation. OIRA does not set policy 
priorities or do the initial legal interpretations for the 
agencies; they do that. Now, of course, should there be a 
regulation that is not in compliance with the law, that would 
be something that we would be very concerned with.
    In terms of the comments and the public information that 
comes into the rulemaking process itself, that is very much the 
kind of information that OIRA looks at and depends on for parts 
of its review. Just to give you a hypothetical example, were it 
the case that a comment had brought interesting or credible 
data to the rulemaking process and that data were not accounted 
for in the agency's analysis, that would lead to a question 
from OIRA to the agency about why not, and what would the 
effect of accounting for that data be? So we are very concerned 
that the best available information--technical data, science, 
economics--all factor into the rulemaking process, and public 
notice and comment is a very important source of that 
information.
    Mr. LUETKEMEYER. I see my time is up. I appreciate the 
Chairman's indulgence. Thank you very much.
    Chairman GRAVES. Ranking Member Velazquez.
    Ms. VELAZQUEZ. Thank you, Mr. Chairman.
    Administrator Shelanski, OIRA's guidance dated October 26, 
2011, entitled ``Implementation of Retrospective Review Plans'' 
stated that the agency's plan should cover existing significant 
regulations. That is the case; correct?
    Mr. SHELANSKI. Yes, that is correct.
    Ms. VELAZQUEZ. However, several agencies have included new 
rules unrelated to existing regulations, as well as initiatives 
outside of the rulemaking process. So I would like to know what 
is your position on that? And do you believe that these in any 
way will undermine the intent of the executive order?
    Mr. SHELANSKI. Thank you. Thank you very much, 
Congresswoman Velazquez.
    Let me start by saying that retrospective review in my 
view, and I think in the view of the president's executive 
orders, should undertake all agency actions that might save 
money for the American public and particularly for small 
businesses. That could include things that are not rules. For 
example, methods of reducing paperwork and things that might 
fall outside of reforming or repealing an existing regulation. 
And those can be extremely beneficial for small businesses. So 
to the extent that it is part of the retrospective review plans 
or things working under the retrospective review executive 
orders, I do think that it can be appropriate for agencies to 
expand their focus beyond----
    Ms. VELAZQUEZ. Okay. So let us say that, yes, it could be 
appropriate, but do you not believe that the focus of the 
review should be on emphasizing those rules, those existing 
rules to relieve the burden?
    Mr. SHELANSKI. Yes. Yes, I do. That certainly is the focus 
of retrospective review. Now, what can be a little bit 
complicated in looking at the plans that the agency has put 
forward is that often the vehicle for changing a pre-existing 
rule is a new rule. And so one might look at them and say, 
well, this is supposed to be a retrospective review plan and 
instead of seeing the words ``repeal, repeal, repeal,'' we see 
new rules. But the effect of those new rules is to modify or 
change in some way pre-existing regulations.
    Ms. VELAZQUEZ. Thank you.
    Administrator, every week that we hold hearings regarding 
an issue related to small business growth, people raise the 
regulatory environment and how this hinders small businesses. 
My question to you is agencies have been reporting for over a 
year now on retrospective reviews. And we want them to do their 
work because it is going to show cost savings for small 
businesses. What is the role that sequestration plays on that 
effort?
    Mr. SHELANSKI. Well, I think that is a very important 
question. I can speak from OIRA's standpoint. I think the role 
of sequestration in general is one that constrains the ability 
of agencies to have as much person power as they would like to 
have in their various functions, and to the extent one of those 
functions is retrospective review, one might imagine that 
sequestration is having a negative effect on their ability to 
devote resources to that activity. But as for the specific 
effects on any given agency, I cannot speak to that.
    I can, however, speak to OIRA's role in encouraging and 
working with the agencies and reviewing their retrospective 
review plans. All of OMB, OIRA included, is really at sort of a 
bare bones level of staffing at this point, and under 
sequestration we are not in a position, never mind to add 
staff, but not even to backfill vacancies that are occurring. 
And with this extremely hardworking and dedicated staff that we 
have, and I really wish to say that to a person they are 
outstanding and they work extremely hard, we lose some of their 
effort due to furlough days. And we are subject to furlough. 
Just, for example, my staff has furlough day this coming 
Monday. They have a furlough day the Monday afterwards. They 
have had furlough days since sequestration. And that, of 
course, is person power that we do not have to devote to this 
effort.
    Ms. VELAZQUEZ. Thank you.
    It has been two years since agencies issued their final 
plans and began implementing them. Are you satisfied that 
agencies are taking this seriously?
    Mr. SHELANSKI. Thank you very much for that question. I am 
satisfied that they are taking it seriously, but I want to be 
careful with the word ``satisfied.'' I am very encouraged by 
the signs that I have seen. You know, the president's executive 
order is only a couple of years old on retrospective review, 
and I think that what I have seen is an increasing engagement 
by the agencies in this process. So I am satisfied that it is 
getting traction, but I want to see more.
    Ms. VELAZQUEZ. Okay. So my final question is we have seen 
executive orders before and they come and they go. Do you 
believe that this time agencies are more committed than they 
have been in the past? Are we breaking that culture?
    Mr. SHELANSKI. Well, I think that is a very important 
question. I do think that there is a culture of retrospective 
review and of look back that is taking hold in the agencies. 
Certainly, none of us want to see regulations that are getting 
in the way of small business, that are deterring small 
businesses, or that are imposing unjustified costs. We do not 
want to see those persisting.
    Ms. VELAZQUEZ. Okay. So my next question, what type of 
oversight do you have in place to make sure that agencies will 
be held accountable?
    Mr. SHELANSKI. Well, what OIRA does as part of this process 
is first of all, we make sure that the agencies are engaging in 
the processes that are mandated under the president's executive 
orders related to retrospective review, and we have provided 
guidance on how to implement those executive orders. But we 
also require the agencies to file their reports with OIRA. In 
fact, in early July, all executive departments and agencies did 
file their reports with OIRA showing a very serious engagement 
with the retrospective review process. There are a large number 
of initiatives that are listed on each agency's report. We are 
in the process of reviewing them, and those will very shortly 
be public on the agency's websites.
    Ms. VELAZQUEZ. Will you be grading them?
    Mr. SHELANSKI. You know, we do not grade them per se but we 
provide them feedback and we try to improve their efforts.
    Ms. VELAZQUEZ. Well, the public wants to know that they are 
really doing the work that they are supposed to be doing.
    Mr. SHELANSKI. Right. And really the proof of that is not 
just the lists that they very openly will post on their 
websites, but it is the real dollar savings that we have seen 
in the past two years from these retrospective review efforts 
which in terms of finalized rules that are retrospective and 
that change preexisting regulations, we can already find $10 
billion of savings to the American public, much of that savings 
enjoyed by small businesses. But I can also say that looking 
forward there are very important rules, such as one that the 
Department of Transportation is going to release that is going 
to reduce reporting obligations of truck drivers for vehicle 
inspection reports and reduce daily burdens on truck drivers. 
And perhaps I will talk more about that rule later. But that 
will have $1.7 billion in savings, not to mention all of the 
hassle and annoyance that truckers have to face until now in 
filing those reports.
    These are the kinds of efforts that we see on an ongoing 
basis. And I think the way for the public to evaluate the 
retrospective review efforts is to look at those savings and to 
see the ongoing efforts to find them.
    Ms. VELAZQUEZ. Thank you, Administrator. I yield back.
    Chairman GRAVES. Mr. Hanna.
    Mr. HANNA. You mentioned in your testimony the president's 
Quick Pay initiative, which you know, this Committee has 
supported. But the Department of Defense has, which is over 70 
percent of subcontractors, about $51.8 billion has decided to 
do away with that. And yet earlier in your conversation you 
mentioned that they were committed to paying people more 
quickly. Can you respond to that?
    Mr. SHELANSKI. Thank you very much for the question, Mr. 
Hanna. I would have to go back and look at what the current 
status of the Department of Defense's implementation is. I am 
not aware of that.
    Mr. HANNA. One other thing I want to ask you. The idea of a 
cost-benefit analysis is by definition subjective. What does it 
mean to you? And what does it mean in your department? And is 
it really money or is it subjective and more nuanced than that? 
At what point do you decide a regulation is or is not worth 
doing? What does that mean in real terms?
    Mr. SHELANSKI. Well, I think what it means in real terms is 
this. What cost-benefit analysis should do is, to the extent 
possible, quantify the costs that a regulation will bring to 
the American public, but also the benefits in dollar terms that 
will be created. And in many cases, those benefits can be 
quantified. For example, when we talk about the forthcoming 
Department of Transportation DVIR rule, that is the 
retrospective rule that is going to lift certain inspection 
report requirements that truckers have to comply with every 
day. We can actually count the amount of time it takes a 
trucker to file that report every day, and you can quantify 
what the value of that is by knowing what the average hourly 
rate of a trucker is and how many truckers are out there on the 
road.
    Mr. HANNA. Who decides when a rule is more expensive than 
the benefits derived?
    Mr. SHELANSKI. To the extent benefits can be quantified, we 
can look and see what the costs are and measure them against 
the benefits. But to your point that there are often values 
that go beyond things that are easily quantifiable, that is a 
harder question. Certainly, there are values that are beyond 
those that are quantifiable that do come into the evaluation of 
a regulation, and those might be in some cases hard to put a 
dollar value on. But I would note that those are also often 
values that are dictated by the underlying statute.
    Mr. HANNA. On another note getting back to Quick Pay and 
the president's directive, do you have the ability to go to the 
Department of Defense and ask them to follow the directive 
rather than abandon it to over 70 percent of their contracts? 
What would you say if you found out what I am saying to you 
today is true, which we believe that it is?
    Mr. SHELANSKI. OIRA does not have jurisdiction to go and 
enforce the law on executive departments. We review regulations 
as they come in to us. Once the regulations are finalized and 
they are out there on the books, we are not an enforcement 
agency, so it would not be within our jurisdiction to go out 
and call them into account.
    Mr. HANNA. But let us say you looked at that, which you 
will when you get back I hope, and you discovered that it was a 
big expense to the small businesses that they are paying them 
but not paying in a timely fashion. What would you do? Would 
you just put it back in the drawer or would you call this 
Committee?
    Mr. SHELANSKI. Well, you know, it is not in our drawer. 
What we would hope is that small businesses would be making 
clear that the regulation is not working as they had hoped and 
that the entities with the appropriate jurisdiction would 
investigate what was happening. What we would do is if there 
was a regulation that was submitted to us by the Department of 
Defense that was changing their practices, we would review that 
regulation under our normal processes.
    Mr. HANNA. So 70 percent of these contracts by small 
businesses that are out there that the Department of Defense 
has decided not to follow the Quick Pay rules, really what you 
are saying is that they can do that and there is no recourse?
    Mr. SHELANSKI. Well, no, that is not what I am saying at 
all, sir. Just to be----
    Ms. VELAZQUEZ. Will the gentleman yield? I would suggest 
that the small businesses, the contractors, reach out to the 
Office of the IG. They have the jurisdiction to investigate 
whether or not the agency is complying with the rules.
    Mr. HANNA. Thank you. My time is expired.
    Chairman GRAVES. Ms. Hahn.
    Ms. HAHN. Thank you, Mr. Chairman, Ranking Member 
Velazquez.
    So we are 13 years into the 21st century and yet we are 
only just beginning to develop the streamlined and modern 
government that the American people expect and deserve from the 
nation that invented the Internet. An important part of that is 
judicious and thorough reviews of our regulations, ensuring 
that our regulations have not grown outdated or duplicative and 
making sure that we are cutting down on paperwork wherever we 
can. Since last Congress, I have actually had some legislation 
to make the Small Business Administration's pilot Small Loan 
Advantage Program permanent. That pilot has streamlined 
applications for small loans up to $350,000, cutting down their 
paperwork to only two pages. And I think that is the sort of 
thing that we should be doing across government. In particular, 
I think we need to do more to shift more of our compliance and 
regulatory infrastructure online and to improve our electronic 
filing.
    Last week, in this Committee, we had the head of the IRS 
talk about how severe budget cuts have been endured by the IRS, 
and that has meant that they have had to prioritize which tax 
forms they have moved to e-filing, and that means that some 
more exotic forms are getting pushed down the waiting line for 
next year or the year after. And the commissioner noted that 
the people and the small businesses that still have to paper 
file these less common forms make a lot of noise about how 
especially burdensome and complicated they are and how much 
they would benefit from e-filing, but his budget limits him 
from helping them now.
    So I am going to ask you, what do you think Congress needs 
to do to accelerate and support the shift towards e-filing and 
technology-based reporting across government? And what do you 
think are the greatest obstacles to moving towards e-filing and 
technology-based reporting? And are some of the agencies 
farther along or lagging behind than others in that respect?
    Mr. SHELANSKI. Thank you very much for your questions, 
Congresswoman Hahn, because you have raised an issue that I 
think is very important to me as administrator and is very 
important to OIRA and OMB, which is paperwork reduction but 
also making the government more accessible and easier to use 
for American citizens. E-filing, electronic access to 
information are all part of that picture. To be sure, part of 
OIRA, part of the acronym is information. And so a lot of what 
we are concerned about is implementation of the Privacy Act, 
paperwork reduction. All kinds of online initiatives, of 
course, have to be balanced against concerns about privacy and 
data security, and I think those are things that the agencies 
are working together on very well. OMB is part of a broader 
interagency process that looks at all of these kinds of issues 
on an ongoing basis. And so consistent with the obligations of 
ensuring privacy, data security, it is a major priority to make 
this government simpler, more accessible.
    In terms of the particular priorities that an agency might 
have in moving towards electronic filing or electronic data 
availability, I cannot speak to the particular agencies' 
priorities. They have to set those consistent with their 
statutes, with their policy mandates, and with their resources. 
And so I think one of the things that I hope going forward is 
that the agencies will have the resources to fully continue 
their work on making government as user friendly and as 
accessible as possible.
    Ms. HAHN. Yeah, I appreciate that, but I think one of the 
things I think we really, I mean, it is one thing to review 
these regulations and see where we might do a better job, but 
it is another thing if we are asking businesses to comply and 
we are making it really difficult or burdensome of them to fill 
out forms to show that they are in compliance. I mean, I just 
really feel like that is another part of what I would like to 
see you also include as part of your reviews.
    Mr. SHELANSKI. Thank you. And I agree entirely. One of the 
things that we do look at in all of our reviews is to see what 
the paperwork burdens are and to see that the agencies have 
done what is possible to reduce those burdens. And 
particularly, pursuant to our particular concern for small 
businesses, to see what can be done to reduce the cost of small 
businesses that may not have the ability to hire somebody to be 
a paperwork person. We are very concerned about the way that 
this could actually become more costly for small businesses. So 
we do review agencies' efforts to try to reduce those burdens.
    Ms. HAHN. And make suggestions?
    Mr. SHELANSKI. We make suggestions. We ask questions about 
why things might not be done other ways, but sometimes there 
are limits to the resources, to the technology, legal 
questions. But I can assure you that the agencies and certainly 
my office are very concerned with these issues.
    Ms. HAHN. Thank you. I yield back the balance of my time.
    Chairman GRAVES. Mr. Schweikert.
    Mr. SCHWEIKERT. Thank you, Mr. Chairman.
    Mr. Director, help me understand some of your process. 
Agency is working on a reg set, rule set. What do you do 
methodology in your office? What are your steps you go through 
to review?
    Mr. SHELANSKI. Well, at the point that the agency is 
actually engaged in the rulemaking process, the rulemaking 
process is at the agency, and so in most cases it is a notice 
and comment rule process. It is there at the agency, not with 
my office.
    Mr. SCHWEIKERT. In your shop, what are your steps? What do 
you do?
    Mr. SHELANSKI. After the agency feels that it has its rule, 
whether it is a proposed rule or a final rule or some kind of 
advanced notice of a rule, when they feel they have that 
document ready, they notify my office and say we would like to 
transmit this or we are going to transmit this rule to you. 
They then upload the rule in our system and it becomes public 
at that point what the rule is and that it is with OIRA. And 
this is following a public notice and comment period at the 
agencies.
    Mr. SCHWEIKERT. Okay. So at this point you are a bulletin 
board. What do you do next?
    Mr. SHELANSKI. We then take the rule--and we are much more 
than a bulletin board. I have got----
    Mr. SCHWEIKERT. What do you do next?
    Mr. SHELANSKI. It will go to the relevant branch, and an 
analyst will sit down with the rule and start working through. 
What is this rule designed to accomplish? What other rules 
might be doing what this rule is doing? What other agencies 
might have an interest?
    Mr. SCHWEIKERT. Okay. At that point, so you have a 
researcher and an analyst----
    Mr. SHELANSKI. Yes.
    Mr. SCHWEIKERT.--going over the rule. What tools is that 
researcher to go over and say a version of this rule already is 
in the reg sets here? This is duplicative. So when they are 
doing their--I am trying to understand the mechanics of how do 
you actually do your analysis and find either things that are 
wonderful or things that are ultimately bad acts?
    Mr. SHELANSKI. So there are several components of the 
analysis. One would be the question of is this a rule that 
relates to other rules that might already exist or rules that 
other agencies are either promulgating or have promulgated. And 
that is where we convene the interagency process to make sure 
that this is not duplicative or conflicting.
    Mr. SCHWEIKERT. Okay. So at that moment you are telling me 
the analyst is not doing the research themselves but they are 
bringing together representatives who cover other agencies to 
provide the input?
    Mr. SHELANSKI. If there is something in the rule that might 
implicate the activities of another agency, the most efficient 
course of action is to say to those other agencies--because 
they know much more what they are up to and they will know much 
better what rules they are enforcing--how does this rule 
interact with what you do?
    Mr. SCHWEIKERT. So your analyst does not first do a search, 
a public document search on that subject area, that specialty 
area or common regulatory literature and first builds the box 
around it?
    Mr. SHELANSKI. No. The rule comes to the analyst with 
explanations of why the rule is being promulgated, what other 
rules are out there, and the analyst is researching this.
    Mr. SCHWEIKERT. Okay. You are saying two different things, 
and maybe I am not understanding, so work with me here.
    The analyst is given this information from the agency; 
right?
    Mr. SHELANSKI. The analyst is given a draft rule.
    Mr. SCHWEIKERT. Okay. And is the analyst actually doing the 
research or is the analyst reading someone else's research?
    Mr. SHELANSKI. The analyst is doing both. It is not an 
either/or. The analyst will be doing research. The analyst will 
be reviewing the cost analysis and the benefit analysis. And 
the analyst will be looking primarily for two things. And the 
two things that the analyst will be looking at primarily are 
why is this rule being done? And what other rules might be 
implicated? The analyst can do the analyst's own research, but 
also draw on other research that is submitted, comments that 
are submitted, the preamble to the rule. They are both there.
    Mr. SCHWEIKERT. Okay. Well, one of the things I wanted to 
get to and we are only down to about 40-some seconds now, okay, 
so analysts now have done the research or read someone else's 
and finds out parts of the rules are duplicative. Do you have 
the authority area to reach out and say, hey, this rule is more 
modern? We need to find a way to eliminate the previous? Or 
what happens in those sorts of cases?
    Mr. SHELANSKI. Well, the question that is asked there is 
why are there benefits to this rule given what is already out 
there? And this is where the very rigorous analysis comes into 
play.
    Mr. SCHWEIKERT. Okay. Now, in our last 10 seconds, how 
often does that happen and how often is the rule basically, the 
path of it, ended because of that type of analysis?
    Mr. SHELANSKI. The back and forth, the finding of 
questions, hard questions, happens on a daily basis at OIRA.
    Mr. SCHWEIKERT. How often does a rule not move forward 
because of this analysis?
    Mr. SHELANSKI. Well, it would depend what you mean by ``not 
move forward.'' If what you mean----
    Mr. SCHWEIKERT. It means it does because it is duplicative 
or some other research you created.
    Mr. SHELANSKI. What happens is there is a back and forth 
between OIRA and the agency. And rules can change. They can be 
pulled back, like the fiduciary rule, and be repromulgated. The 
rule can be changed in response to comments and the review 
process.
    Mr. SCHWEIKERT. Forgive me. I am way over time.
    Thank you for your patience, Mr. Chairman.
    Chairman GRAVES. I am trying to figure out--we are going to 
have a long series of votes. I know we have got several members 
that are left to ask questions. Does anybody have anything that 
they need pressing asked? If so, speak now.
    Mr. BARBER. I will try to be brief, Mr. Chairman. I just 
wanted to have an opportunity since I probably cannot come back 
when we reconvene, thank you for your testimony and thank you, 
Mr. Chairman, and ranking member for convening this hearing.
    As a small business owner, I know from our experience--my 
wife and I's experience 22 years as small business owners--that 
we just have to make every effort to get direct input from 
small business owners and feedback of what is working and what 
is not working. That is why I meet regularly with small 
businesses. It is the only way I can do this job effectively. 
Part of the retrospective review process that federal agencies 
are already implementing on an ongoing basis to review 
regulations requires that they solicit input from the public, 
from the general public, and I believe the most crucial 
component of any regulatory review process is that kind of 
direct feedback.
    But it seems to me that each agency is pretty much 
interpreting the standards as they see fit and differently. 
While some are going to communities in a very open way and 
talking to people who are really interested in the issues, 
others print their review process on their website in such fine 
print you have to take a magnifying glass to read it. It seems 
to me that so many agencies are closed to public input and 
closed to members of the public who have an interest in their 
regulations.
    Can you tell the Committee what guidance your office is 
providing to federal agencies regarding public input and what 
it should look like and how we can better ensure that we do not 
just have a process that is in name only but a real process 
that gets input from the public?
    Mr. SHELANSKI. Thank you, Mr. Barber. You have raised the 
critical issue of transparency and the openness of the 
regulatory process to the public. And I agree, and OIRA agrees, 
that it is absolutely critical that rulemaking be as open and 
accessible as possible to all members of the public. And that 
would mean especially for the reasons that you provided the 
small business community.
    As a general matter, the rulemakings that come to us have 
been through a very open notice and comment period. Now, it may 
well be the case that different agencies have different levels 
of resources or different institutionalized practices for reach 
out specifically for small businesses and therefore can get 
more input. I think it is of vital importance for small 
businesses to encourage such efforts to get their associations 
or to get their coalitions to focus on the agency actions. I 
applaud the actions of this Committee to apprise small 
businesses of specific regulatory actions that are pending that 
small businesses might want to pay attention to. I could not 
agree with you more that making sure that the process is open 
and accessible is paramount. And the guidance that we at OIRA 
give to agencies is precisely that.
    Mr. BARBER. Can you say what more you think you can do in 
your new position to really make sure that they get it? That it 
is not just some kind of a process that really does not mean 
anything, you know, in name only that kind of generally follows 
the law but really does not get at the heart of what the public 
wants to say?
    Mr. SHELANSKI. Well, I think what we can do since our 
experience is that most agencies really do follow the notice 
and comment period, or notice and comment process, indeed, 
their regulations are quite vulnerable if they do not follow 
that process, and I think they understand that. So it is very 
much in their interest to ensure that the requirements of the 
Administrative Procedure Act are followed. What we can do is to 
encourage and to ask what small business input was received? 
What efforts were made to respond to that? How did that factor 
into your analysis ? These are the kinds of questions that we 
at OIRA can ask and will ask, and I believe that those can help 
to focus attention on precisely the issues you raise.
    Mr. BARBER. Well, I encourage you to be even more vigilant. 
And I thank you, Mr. Chairman. I yield back.
    Chairman GRAVES. I would ask that any other members that 
have questions to please submit them, and I would hope that Mr. 
Shelanski, you would answer them in a very timely manner and 
get back to us on that since we do have a series of votes and 
we will not keep you through that series of votes.
    Mr. SHELANSKI. Thank you, Chairman Graves. And I would be 
pleased to respond in a timely manner.
    Chairman GRAVES. Well, I want to thank you for testifying 
today. You know, reducing unnecessary regulations or regulatory 
burdens, I guess, is critically important to small businesses 
when they are trying to compete and trying to create jobs in a 
competitively global economy. And these retrospective reviews 
can yield results but only if it is taken seriously, and I hope 
you use your office and your position to ensure that the 
agencies are taking it seriously and trying to do just that. 
And I hope you will update us, too, periodically, if you would, 
on the progress of this and how it is obviously affecting small 
businesses.
    With that, again, I want to thank you for coming in.
    Mr. SHELANSKI. Thank you, Chairman Graves. This is just to 
end on the note by ensuring you that small businesses are very 
much at the heart of this administration's concern with growing 
the economy, creating jobs, and it is very much a focus of my 
office.
    Chairman GRAVES. Well, with that I would ask unanimous 
consent that all members have five legislative days to submit 
statements and supportive materials for the record. Without 
objection that is so ordered. And with that the hearing is 
adjourned. Thank you.
    [Whereupon, at 1:56 p.m., the Committee was adjourned.]
                            A P P E N D I X


                   [EMBARGOED UNTIL 1:00 PM, JULY 24]


                   EXECUTIVE OFFICE OF THE PRESIDENT


                    OFFICE OF MANAGEMENT AND BUDGET


                         WASHINGTON, D.C. 20503


                         www.whitehouse.gov/omb


                     TESTIMONY OF HOWARD SHELANSKI


   ADMINISTRATOR FOR THE OFFICE OF INFORMATION AND REGULATORY AFFAIRS


                    OFFICE OF MANAGEMENT AND BUDGET


               BEFORE THE HOUSE SMALL BUSINESS COMMITTEE


                 UNITED STATES HOUSE OF REPRESENTATIVES


                             July 24, 2013


    Mr. Chairman, Ranking Member Velazquez, and Members of the 
Committee, thank you for the opportunity to appear before you 
today. I was recently confirmed as the Administrator of the 
Office of Information and Regulatory Affairs (OIRA) at the 
Office of Management and Budget (OMB), and am honored to be 
serving in this role. I look forward to speaking with you today 
about the topic of retrospective regulatory review and its 
benefits for small business.

    Retrospective review is critical to ensuring that our 
regulatory system is modern, streamlined, and does not impose 
unnecessary burdens on the American public. Even regulations 
that were well crafted when first promulgated can become 
unnecessary over time as conditions change. Retrospective 
review of regulations helps to ensure that those regulations 
are continuing to promote the safety, health, welfare, and 
well-being of Americans without imposing unnecessary costs.

    Recognizing the importance of this effort, in January 2011, 
the President issued Executive Order 13563, ``Improving 
Regulation and Regulatory Review.'' Among other things, that 
Executive Order asks executive departments and agencies to 
review existing Federal regulations to streamline, modify, or 
repeal regulations and reduce unnecessary burdens and costs. As 
a result of that Executive Order, executive departments and 
agencies produced more than two dozen plans, with over 500 
regulatory reform initiatives. Just a small fraction of the 
rules already finalized will produce billions of dollars of 
savings in the near term.

    Since issuing Executive Order 13563, the President has 
taken several other important actions relevant to retrospective 
review. In July 2011, the President issued Executive Order 
13579, ``Regulation and Independent Regulatory Agencies,'' 
which asked the independent regulatory agencies to follow the 
principles of Executive Order 13563 and to develop their own 
retrospective review plans. Almost twenty independent agencies 
issued plans for public comment, and many have implemented 
substantial initiatives. For example, in May 2013, the Federal 
Communications Commission announced that it was lifting over 
120 outdated or unnecessary regulatory requirements on phone 
companies.

    In order to further institutionalize retrospective review, 
President Obama issued Executive Order 13610, ``Identifying and 
Reducing Regulatory Burdens'' in May 2012. To promote priority-
setting, the Executive Order directs agencies to emphasize 
reforms that produce significant, quantifiable savings. To 
promote accountability, the Executive order requires agencies 
to provide the public with regular reports on their past 
efforts and their future plans. These reports are available on 
agency websites.

    The Administration's retrospective review efforts are 
already producing significant results. For example:

           The Department of Health and Human Services 
        (HHS) finalized rules to remove unnecessary regulatory 
        and reporting requirements on hospitals and other 
        healthcare providers, saving more than $5 billion over 
        the next five years.

           The Department of Labor (DOL) finalized a 
        rule to simplify and to improve hazard warnings for 
        workers, producing net benefits of more than $2.5 
        billion over the next five years while increasing 
        safety.

           HHS finalized a rule to allow greater 
        flexibility for providers that rely on telemedicine 
        services, making services more readily available in 
        remote rural areas and saving providers millions of 
        dollars in the process.

           DOL finalized a rule that will remove 
        approximately 1.9 million annual hours of redundant 
        reporting burdens on employers and save more than $200 
        million in costs over five years.

           The Environmental Protection Agency 
        finalized a rule to eliminate the obligation for many 
        states to require air pollution vapor recovery systems 
        at local gas stations, since modern vehicles already 
        have effective air pollution control technologies. The 
        anticipated five-year savings are over $400 million, a 
        number that takes into account the costs associated 
        with the removal of vapor recovery equipment and the 
        use of less expensive conventional equipment on the 
        gasoline dispensers, as well as reductions in record-
        keeping requirements and other operating costs.

           The Department of Transportation (DOT) 
        finalized a rule to eliminate or extend most compliance 
        dates on traffic control requirements (which would, 
        among other things, require states and localities to 
        change street name signs), saving millions of dollars 
        in the process.

    Our retrospective review efforts have focused especially on 
benefiting small businesses. Some examples include:

           The DOT retrospective review plan alone 
        identifies over two dozen initiatives to save money for 
        small businesses and local governments. For example, 
        one of DOT's initiatives would codify regulations to 
        prevent duplicative requirements for air carrier drug 
        and alcohol testing programs, which would be 
        particularly helpful for small carriers.

           The Department of Defense issued a new rule 
        to accelerate payments on contracts to as many as 
        60,000 small businesses, improving their cash flow.

           The Small Business Administration is 
        adopting a single electronic application to reduce the 
        paperwork required of certain lenders, which will in 
        turn benefit small business borrowers who seek 
        relatively small amounts of capital to grow and 
        succeed.

    DOT has proposed a rule that would harmonize hazardous 
material standards with international requirements and update, 
clarify, correct, or provide relief from certain regulatory 
requirements for the transportation of radioactive materials. 
DOT expects the rule to result in cost savings for small 
businesses by easing the regulatory compliance costs for 
shippers and carriers engaged in international commerce, 
including trans-border shipments within North America. This 
past winter, agencies focused their retrospective review 
updates on paperwork burden reduction. Many of the initiatives 
stemming from this effort will save substantial money for small 
businesses. For example, the Internal Revenue Service announced 
a simplified method for claiming the home office deduction, 
which will save taxpayers (particularly those with home-based 
small businesses) over 1.6 million hours and $7 million in out-
of-pocket costs per year. Similarly, DOT is working on a 
proposed rule that would rescind the requirement that 
commercial motor vehicle drivers submit (and motor carriers 
retain) driver-vehicle inspection reports when the driver has 
neither found nor been made aware of any vehicle defects or 
deficiencies. This rulemaking would save tens of millions of 
hours in paperwork burden per year, for approximately $1.5 
billion in annual paperwork time savings.

    In July 2013, agencies submitted to OIRA their latest 
updates of their retrospective review plans, pursuant to 
Executive Orders 13563 and 13610. Although OIRA is still 
reviewing the plans and the full updates are not yet public. I 
am happy to report that many of the initiatives highlighted in 
the updated plans benefit small businesses. For example, the 
Department of Housing and Urban Development is drafting a final 
rule that would create alternative, more streamlined financial 
statement reporting requirements for small supervised lenders 
and mortgagees. The rule would also eliminate duplicative 
reporting requirements for lenders who already report to other 
Federal agencies. In addition, the Federal Aviation 
Administration is proposing a rule to update, simplify, and 
streamline rules of practice and procedure for filing and 
adjudicating complaints against federally-assisted airports. 
Small businesses would particularly benefit from this rule, 
which would decrease the time spent on processing complaints by 
allowing parties to file electronically.

    Retrospective review is crucial to ensuring that we have a 
well-functioning regulatory system, and moving forward I will 
look for further ways to institutionalize retrospective review 
of regulations and ensure that it continues to produce 
significant cost-savings for small businesses and for the 
American people.

    Thank you for your time. I would be happy to answer any 
questions.
    Chairman Sam Graves:

    1. How much is it costing agencies to conduct retrospective 
reviews?

    I would refer you to the agencies, which are best suited to 
answer this question.

    2. How are agencies doing their existing work while 
conducting retrospective reviews?

    Agencies prioritize their regulatory work based on their 
respective agency goals and priorities, as well as guidance 
provided by the President's Executive Orders. Executive Order 
13610 states that ``agencies shall give priority [in doing 
retrospective review], consistent with law, to those 
initiatives that will produce significant quantifiable monetary 
savings or significant quantifiable reductions in paperwork 
burdens while protecting public health, welfare, safety, and 
our environment.'' It further states that ``agencies shall give 
consideration to the cumulative effects of their own 
regulations, including cumulative burdens.''

    3. How are agencies documenting their outreach to outside 
or regulated entities in doing these reviews?

    Executive Order 13610 states that ``agencies shall invite, 
on a regular basis, public suggestions about regulations in 
need of retrospective review and about appropriate 
modifications to such regulations.'' Agencies use a variety of 
approaches for soliciting and documenting outreach, ranging 
from Federal Register notices to public meetings to websites 
focusing on retrospective review.

    4. Some agencies are reviewing guidance documents as part 
of their retrospective review process. Should that be a 
requirement for all agencies under the terms of Executive Order 
13,563?

    OIRA has encouraged agencies to consider not just 
rulemakings, but paperwork burden reduction initiatives as well 
as guidance documents.

    5. In your testimony you noted that agencies are required 
to provide the public with regular reports on their 
retrospective review efforts and that those reports are 
available on agency websites. However, not all the agencies 
have posted all their reports on their websites and some of the 
agencies' reports provide very little detail. Furthermore, on 
the White House website, only the preliminary and final 
retrospective review plans and January and May 2012 progress 
reports are available.

          a. Have all executive agencies submitted the five 
        required progress reports to your office so far? If 
        not, please provide the names of the agencies that have 
        not provided all the required reports.

          b. What will the Office of Information and Regulatory 
        Affairs (OIRA) do to ensure that agencies make their 
        reports available on their websites within three weeks 
        of submission of the draft reports to OIRA, as directed 
        by Executive Order 13,610, and provide complete and 
        detailed information on their activities to the public?

    Executive Order 13610 requires agencies to make final 
reports available to the public within a reasonable period (not 
to exceed three weeks from the date of submission of draft 
reports to OIRA). All executive agencies are required to submit 
progress reports and post them on their respective Open Gov 
(www.agencyname.gov/open) websites. Agencies posted the most 
recent reports on their Open Gov websites on July 29, 2013, 
three weeks after submitting them to OIRA. All executive 
agencies have submitted the five required progress reports to 
date.

    6. Some agencies appear to have done little more than 
incorporate their regular, planned rulemaking activities into 
their retrospective review reports. Agencies also are making 
changes to new rules that have not yet been implemented and 
claiming that the changes are part of retrospective review. 
Other agencies are claiming that certain actions will reduce 
burdens significantly, but the regulated entities have 
indicated that the burden reduction estimates are significantly 
overstated or fail to account for significant burden increases 
associated with the same regulatory action. All of this 
indicates that agencies are not taking the retrospective review 
effort seriously and are not making genuine efforts to review 
existing regulations.

          a. Is OIRA scrutinizing agency progress reports and 
        asking agencies to remove items from the report that 
        are not truly retrospective review activities?

          b. Is your office scrutinizing agencies' burden 
        reduction estimates to ensure that they are accurate?

          c. If OIRA finds that an agency's burden reduction 
        estimates are inaccurate, what actions does OIRA take?

          d. What will OIRA do to ensure that agencies are 
        actually reviewing existing significant regulations?

    Agencies understand that they are expected to devote 
significant resources to examine whether existing rules should 
be modified or streamlined in order to remove unjustified 
regulatory and paperwork burdens. OIRA works with agencies to 
stress the importance of appropriately prioritizing and 
thinking comprehensively about retrospective review.

    OIRA reviews agency submissions of information collection 
requests covered under the Paperwork Reduction Act, including 
submissions that are submitted as part of a retrospective 
review rulemaking. Consistent with the Paperwork Reduction Act, 
agencies are required to provide a justification and 
itemization of all estimates in their information collection 
requests. Agencies also issue a 60-day Federal Register notice 
as well as a 30-day Federal Register notice to seek comment on 
the agency estimates. OIRA reviews the evidence provided by the 
agency as well as any public feedback received during the 
public comment periods to ensure that any information 
collections meet applicable standards.

    7. A December 2012 Governmental Accountability Office 
report found that agencies did not publish a notice of proposed 
rulemaking for about 35 percent of major rules and about 44 
percent of non-major rules published between 2003 through 2010. 
Agencies frequently cited the ``good cause'' exception and 
other statutory exceptions as reasons to bypass notice and 
comment rulemaking. This is particularly problematic for small 
businesses because the Regulatory Flexibility Act (RFA) is 
triggered by notice and comment rulemaking. What will you do to 
ensure that exceptions are not inappropriately used to avoid 
analytical requirements like the RFA and public input to the 
rulemaking process?

    I believe firmly in the value of a rulemaking agency 
obtaining public comment during its development of a rule, 
because public comment can improve agency's decision-making 
process. Public comments can provide new information, different 
perspectives, and ideas for alternative solutions. However, as 
Congress recognized when it enacted the ``good cause'' 
exception in 1946, as a part of the original Administrative 
Procedure Act (APA), there are situations in which it would be 
``impracticable, unnecessary, or contrary to the public 
interest'' for a rulemaking agency to seek public comment 
before acting. In such a situation, an agency is required to 
include an explanation for its use of the good cause exemption 
in the preamble of the rule issued. That explanation is 
included in any such rule that may be reviewed by OIRA under EO 
12866. In addition, in cases where agencies use interim final 
rules under the ``good cause'' exception, the public is 
afforded an opportunity to assess the agency's use of interim 
final procedures once the rule is published. With regard to how 
the use of the ``good cause'' exception impacts agency 
compliance with the Regulatory Flexibility Act, I defer to the 
Small Business Administration's Office of Advocacy, which 
oversees the implementation of that statute.

    8. Agencies are avoiding the notice and comment rulemaking 
process and imposing new burdens through guidance, memos and 
other documents.

          a. At your June 12, 2013 confirmation hearing before 
        the Senate Homeland Security and Government Affairs 
        Committee, you said, ``It is my view that substance 
        rather than labels should dictate OIRA's review.'' 
        Could you elaborate on this statement? Will you direct 
        agencies to utilize the notice and comment rulemaking 
        process instead of issuing guidance, memos and other 
        documents when those issuances impose significant 
        burdens?

          b. Are you concerned about agencies inappropriately 
        avoiding notice and comment rulemakings and thereby the 
        responsibility to give full consideration of impacts on 
        small businesses, among other protections?

          c. There are concerns about the effort of the 
        Interagency Working Group (IWG), of which the Office of 
        Management and Budget is a participant, on the Social 
        Cost of Carbon (SCC). The expressed purpose of the IWG 
        effort is ``to incorporate the social benefit of 
        reducing CO2 emissions into cost-benefit analyses of 
        regulatory actions that impact global emissions.''

                  I. Is OIRA concerned t hat the calculated 
                SCC, which is now as much as $129 per ton of 
                CO2, may be used to justify the benefits of new 
                rules that impact small entities, yet the SCC 
                was established without a formal rulemaking, 
                review under the Data Quality Act, the RFA and 
                review or approval by Congress? If so, have 
                those concerns been expressed in any formal 
                way?

        In your June 18, 2013 testimony before the House 
        Committee on Oversight and Government Reform 
        Subcommittee on Energy Policy, Health Care and 
        Entitlements you stated that the current SCC estimates 
        will be used in future rulemakings. You went on to 
        state that the public will have an opportunity to 
        comment on the SCC when it is used in a rulemaking. 
        Instead of forcing the public, including small 
        businesses with limited resources, to go through the 
        inefficient and duplicative process of commenting on 
        the SCC in multiple rules, why wasn't the updated SCC 
        published as a separate, stand-alone document in the 
        Federal Register for notice and public comment?

    My statement was intended to express that the label on the 
policy document is not the key factor determining whether 
Executive Orders 12866 or 13563 apply. Executive Order 12866 
defines a ``rule'' as ``an agency statement of general 
applicability and future effect, which the agency intends to 
have the force and effect of law, that is designed to 
implement, interpret, or prescribe law or policy or to describe 
the procedure or practice requirements of an agency.'' There 
are instances when guidance and other non-binding statements 
are useful to members of the public, because they provide 
information about the agency's priorities or other 
discretionary aspects of their mission. Therefore, OIRA does 
not direct agencies to avoid these types of documents entirely. 
However, we firmly support the lines established by both the 
Administrative Procedure Act, which governs the legal process 
for promulgating rules, and Executive Orders 12866 and 13563, 
which govern regulatory planning and review.

    As to your question about the Social Cost of Carbon, in 
2009, an interagency working group developed recommendations 
for agencies to use in estimating benefits from carbon 
emissions reductions in agency rule making. These estimates 
were based on the leading peer-reviewed academic models (DICE, 
FUND, and PAGE) developed by researchers at Yale University, 
Cambridge University, the University of Sussex and the 
University of Michigan. These estimates were used by several 
agencies in subsequent rules, with multiple opportunities 
provided for public comment. At the time the 2010 
recommendations were issued, the interagency group also 
committed to periodically update the estimates to reflect 
improvements in the underlying models over time. Commenters on 
the initial use of these values also stressed the importance of 
keeping them up-to-date. Since the original estimates were 
developed, all three models have undergone significant 
revisions which have been incorporated into their subsequent 
use in the peer-reviewed literature. In early 2013, the 
interagency group decided that it was appropriate to issue a 
technical update to the estimates to reflect these changes to 
the models. No changes were made to any of the assumptions used 
to derive the estimates from the models, such as the 
appropriate discount rates. The interagency group recommended 
that agencies use a range of values, representing different 
assumptions about discount rates and other factors. The values 
also vary based on the year in which the emissions reductions 
occur. For emissions reductions in 2015, the group recommended 
that agencies use a range from $12 to $109 per ton, with a 
central tendency estimate of $38 per ton. The purpose of the 
recommendations is to improve the quality and consistency of 
agency regulatory analyses. The recommendations are not rules. 
Rather, they help ensure that future rulemaking affecting 
carbon emissions is based on the best available scientific, 
economic, and technical information.

    As noted above, the revised estimates reflected technical 
updates to the earlier estimates, based on changes to the 
underlying models on which they were based that have been 
incorporated into their subsequent use in the peer-reviewed 
literature. The 2010 estimates were updated, as commenters 
suggested and also as the IWG had committed to do on a periodic 
basis when the recommendations were first issued. We expect and 
welcome comments on the SCC values in the context of proposed 
rules that are out for comment now and future proposed rules.

    9. The RFA requires agencies to assess the impacts of 
proposed and final regulations on small businesses and consider 
alternatives that lessen burdens. Unfortunately, agencies still 
do not fully comply with the law. President Obama recognized 
this by issuing a January 18, 2011 memorandum on the Act. What 
will you do to ensure that agencies comply with the RFA?

    As you mentioned, on January 18, 2011, President Obama 
issued a Presidential Memorandum entitled ``Regulatory 
Flexibility, Small Business, and Job Creation.'' The memorandum 
reminds Federal agencies of their responsibilities under the 
Regulatory Flexibility Act and directs executive departments 
and agencies to ``give serious consideration to whether and how 
it is appropriate, consistent with law and regulatory 
objectives, to reduce regulatory burdens on small businesses, 
through increased flexibility.'' The memorandum goes on to 
highlight specific forms of flexibility that agencies should 
consider, including extended compliance dates that take into 
account the resources available to small entities, performance 
standards rather than design standards, simplification of 
reporting and compliance requirements (as, for example, through 
streamlined forms and electronic filing options), different 
requirements for large and small firms, and partial or total 
exemptions.

    During OIRA review of proposed and final rules pursuant to 
Executive Orders 12866 and 13563, OIRA works with agencies to 
ensure that they fully comply with the requirements of the RFA, 
and that they consider, and adopt where appropriate, the 
flexibilities highlighted in the Presidential Memorandum. For 
rules issued by the Environmental Protection Agency, 
Occupational Health and Safety Administration, and Consumer 
Financial Protection Bureau, OIRA also participates with the 
Small Business Administration's (SBA) Office of Advocacy and 
these rule writing agencies in Small Business Advocacy Review 
Panels to solicit input and advice from affected small entity 
representatives and provide recommendations to the rule writing 
agency on alternatives for minimizing the burden of the rule on 
small entities. OIRA also ensures that the SBA Office of 
Advocacy is a full participant in the interagency review of all 
rules that may have a significant impact on a substantial 
number of small entities.

    10. Section 602 of the RFA requires agencies to publish 
regulatory flexibility agendas in the Federal Register each 
April and October. The agendas provide small businesses notice 
of regulatory actions agencies plan to take. The Spring 2012 
regulatory agendas were never published. The Fall 2012 and 
Spring 2013 regulatory agendas were published very late. Will 
you commit to ensuring that the Obama Administration complies 
with the law and publishes the agendas on time?

    I will continue to work to publish the regulatory 
flexibility agendas consistent with applicable law.

    Rep. Chris Collins:

    1. The FDA's menu-labeling proposal would require, for 
example, pizza-delivery restaurants to label in-store menu 
boards with calorie information forcing small businesses to 
spend thousands of dollars for menu boards. In fact, your 
agency estimated that the menu-labeling regulation would be the 
third-most-onerous regulation proposed, requiring more than 
14.5 million hours of compliance. If this single regulation 
exceeds 14 million hours, what will be the expected compliance 
impact of Obamacare, which even by conservative estimates has 
10,000 pages of regulations?

    When judging the merits of any regulation or piece of 
legislation, it is important to look at net benefits (benefits 
minus costs), not just costs. While OIRA does not typically 
report on the aggregate costs of regulations associated with 
particular pieces of legislation, we do issue a report to 
Congress on the costs and benefits of each individual 
regulation reviewed by our office. The most recent on these 
reports was issued in April 2013 and is available on the OIRA 
website. (http://www.whitehouse.gov/sites/default/files/omb/
inforeg/2013--cb/
draft--2013--cost--benefit--
report.pdf).

    Rep. Richard Hanna:

    1. In your testimony, you discussed the President's Quick 
Pay Initiative, which we've been very supportive of as a 
Committee. However, I'm concerned that despite all the fanfare 
with which Quick Pay was announced, some might have missed the 
Department of Defense's (DoD) February announcement (see 
attachment) that it was going to stop participating in the part 
of Quick Pay that helps small subcontractors be paid faster. 
Since over 70 percent of federal contract are awarded by DoD, 
that is a pretty important omission. In fact, in FY 2010, DoD 
had subcontracts of more than $51.8 billion with small 
businesses. What is being done by OIRA and OMB to encourage DoD 
to follow the President's direction on Quick Pay?

    OMB remains firmly committed to improving cash flow for 
small businesses and increasing small business participation in 
all levels of federal contracting--i.e., for prime contractors 
and subcontractors. On July 11, 2013, OMB extended its 2012 
policy pursuant to which agencies temporarily accelerate 
payment to all prime contractors--with a goal of paying them 
within 15 days of receipt of proper invoices--in order to allow 
prime contractors to provide prompt payments to small business 
contractors (see http://www.whitehouse.gov/sites/default/files/
omb/memoranda/2013/m-13-15.pdf). Unfortunately, due to the 
negative impacts of sequestration on DOD's fiscal situation, 
the Department was forced to temporarily suspend the QuickPay 
policy for small business subcontractors. OMB has directed the 
Federal Acquisition Regulatory Council to solicit public input 
on alternative strategies that might be used over the longer 
term to help maintain effective cash flow and prompt payment to 
small business subcontractors, such as considering a prime 
contractor's commitment to paying small business subcontractors 
in a prompt manner as part of a contract award determination.

    Rep. Tim Huelskamp:

    1. According to the May 2013 Technical Support Document, 
``Technical Update of the Social Cost of Carbon for Regulatory 
Impact Analysis,'' the Office of Management and Budget (OMB) 
participated in the Interagency Working Group (IWG) on the 
Social Cost of Carbon (SCC).

          a. Did a staff member of OIRA serve as an OMB 
        participant in the IWG? If yes, who was the 
        participant? Please provide a name and title. If not, 
        who represented OMB in the IWG? Please provide a name, 
        title and office.

          b. Please provide a complete list of the names and 
        titles of all federal agency participants in the IWG.

          c. When the SCC is used in any rulemaking or other 
        guidance documents that OIRA reviews, does OIRA 
        evaluate it in accordance with the Data Quality Act?

          d. Please provide any and all documentation including 
        emails, correspondence, memoranda or meeting notes 
        describing OIRA's review(s) of the SCC.

    OIRA staff participated in the IWG, along with the Council 
on Economic Advisers, the Council on Environmental Quality, the 
Department of Agriculture, the Department of Commerce, the 
Department of Energy, the Department of Transportation, the 
Environmental Protection Agency, the National Economic Council, 
the Domestic Policy Council Office of Energy and Climate 
Change, the Office of Management and Budget, the Office of 
Science and Technology Policy, and the Department of Treasury. 
The Technical Support Document explaining the work of the IWG 
and the technical basis for the revised estimates is available 
at http://www.whitehouse.gov/sites/default/files/omb/inforeg/
social--cost--of--carbon--
for--ria--2013--update.pdf.

    Pursuant to the Data Quality Act (section 515(a) of the 
Treasury and General Government Appropriations Act for Fiscal 
Year 2001 (Public Law 106-554; H.R. 5658), OMB published 
Government-wide Information Quality Guidelines (September 2001 
(66 FR 49718), and February 2002 (67 FR 8452)). Those 
guidelines, in turn, set the template for each agency's own 
Information Quality Guidelines. It is the agency's 
responsibility to ensure that they have conducted pre-
dissemination review. The more important the information, the 
higher the quality standards to which the information should be 
held. During the process of reviewing any regulation or 
guidance document under applicable Executive Orders, OIRA 
engages agencies in discussions to ensure that they have met 
their obligations under their Information Quality Guidelines. 
That discussion focuses on whether the quality, utility, 
objectivity, and integrity of the information upon which policy 
decisions and supporting regulatory analysis are based is 
commensurate with its use.

    2. Is the Clean Water Protection Guidance currently under 
12866 review by OIRA a review of the definition of navigable 
waters by the EPA? If so, will OIRA take into consideration 
decreased agricultural production if farmers are no longer able 
to treat their fields because of this guidance? Specifically, 
would OIRA take into account lower yields and higher food 
prices? With regards to this or any other guidance under review 
by OIRA, are impacted entities required under the 
Administrative Procedures Act to treat guidance as having the 
force and effect of law before OIRA completes its review? 
Please provide any and all documentation including emails, 
correspondence, memoranda or meeting notes regarding this 
review.

    The proposed Clean Water Protection Guidance would provide 
guidance to field staff at EPA and the US Army Corps of 
Engineers on making case-by-case determinations regarding 
whether specific water bodies are ``navigable waters'' and thus 
subject to Clean Water Act requirements. By definition, 
guidance does not have the force and effect of law, whether 
issued in final or draft form and regardless of review by OIRA 
or any other entity. The draft final guidance currently under 
review includes an analysis of its potential economic impacts 
and OIRA is carefully considering these impacts in reviewing 
the draft guidance.

    3. OIRA is currently reviewing the following proposed 
rule--Standards of Performance for Greenhouse Gas Emissions 
from New Stationary Sources: Electric Utility Generation Units. 
According to the proposed rule as published in the Federal 
Register, EPA notes that it will have no cost before 2030 
essentially because no new plants would be built that could 
comply with the rule before 2030. Under this rationale, the 
federal government could pass a series of rules that stop the 
expansion of every sector of the economy and say that it has no 
cost.

          a. Explain how a 17-year delay in the ability of the 
        economy to comply with this proposed rule would comport 
        with President Obama's directive to ``protect public 
        health, welfare, safety and our environment while 
        promoting economic growth, innovation, competitiveness, 
        and job creation'' in Executive Order 13563.

          b. Explain how EPA may use a ``transitional'' 
        designation on generation units that have already 
        acquired a preconstruction permit and begin 
        construction within 12 months. Will the 12 months begin 
        from submission by EPA in 2013 or the original notice 
        in 2012 (in which case the 12 months would be passed)? 
        What standards would ``transitional'' facilities fall 
        under? Does any action by another agency or court toll 
        the 12-month time period to begin construction?

          c. Did OIRA or EPA estimate the cost of constructing 
        new generation units with new technology after 2030 
        with the understanding that the technology could come 
        online sooner? Why or why not?

          d. Does OIRA or EPA take into consideration higher 
        costs to the economy of higher energy prices resulting 
        from reduced supply when no new generation units are 
        constructed for the next 17 years? Why or why not?

          e. Does OIRA or EPA take into consideration higher 
        costs to the economy that may result from rolling 
        brownouts or blackouts that might occur from a reduced 
        supply when no new generation units are constructed for 
        the next 17 years? Why or why not?

          f. Does OIRA or EPA take into consideration higher 
        costs to the economy that may result from fewer jobs 
        being created in the construction or ongoing energy 
        production industries when no new generation units are 
        constructed for the next 17 years? Why or why not?

          g. Please provide any and all documentation including 
        emails, correspondence, memoranda or meeting notes 
        regarding this review.

    Information regarding EPA's analysis of the costs and 
benefits of its June 2012 proposed rule can be found in the 
publicly available rulemaking docket at http://
www.regulations.gov/#!documentDetail;D=EPA-HQ-OAR-2011-0660-
0001.

    The Clean Air Act requires that documents associated with 
OMB review be disclosed to the public when a rule is published. 
Those documents associated with the review of the original 
proposal are available in the EPA rulemaking docket at http://
www.epa.gov/dockets/ and when EPA publishes the re-proposal, 
the documents associated with OMB review of the re-proposal 
will be available here as well. In addition, information 
provided to OMB during public meetings is available on our 
website at http://www.whitehouse.gov.gov/omb/
oira--meetings/. /.

    Rep. Donald Payne:

    1. I understand that retrospective regulatory reviews are 
not new and are certainly needed, particularly to address 
outdated mandates that become burdens. However, the length of 
the review process for new rules from the OIRA can be 
burdensome as well. Just as regulatory reviews are important, 
many new rules offered by agencies address new dangers and 
important updates in areas such as food safety, minimum wage 
and worker safety- all areas that have a real time impact on 
the life of Americans. Just before you were confirmed, 70 of 
the more than 120 rules submitted to OIRA had been under review 
longer than 90 days. What are you doing to address this 
burdensome delay?

    It is one of my top priorities to make sure OIRA reviews 
regulations in a timely fashion. Notably, since earlier this 
year, OIRA has cut in half the number of rules that were under 
review for more than 200 days, and continues to make steady 
progress on bringing that number down. That said, more work is 
necessary. I will continue to work with staff on completing the 
review of rules that have been at OIRA for a substantial length 
of time, while ensuring that reviews continue to be thoughtful 
and careful.

    2. A December 2012 GAO report found that agencies, though 
not required, often requested comments on major final rules 
issued without a Notice of Proposed Rule Making, but they did 
not always respond to the comments received. However, when 
agencies responded to public comments they often made changes 
to improve the rules. Many of these rules have an impact of a 
billion dollars a year or more. Further, courts have recognized 
that the opportunity to comment is meaningless unless the 
agency responds to significant points raised by the public. How 
are you working with agencies to ensure that the public is 
truly engaged in the rule making process?

    Please see my answer to Question 7 from Chairman Graves. As 
a general matter, OIRA encourages agencies to issue final rules 
that demonstrate the agency's consideration of the comments 
received during the comment period, and Executive Order 13563 
emphasizes the importance of adopting regulations ``through a 
process that involves public participation.''

    3. Several retrospective reviews and subsequent proposals 
focus on relieving paper burdens and transitioning to or 
strengthening the use of technology. How have the proposals to 
increase the use of technology taken into account small 
businesses owners who may not be tech-savvy?

    Consistent with the Paperwork Reduction Act, agencies issue 
a 60-day Federal Register Notice as well as a 30-day Federal 
Register Notice seeking comment on all information collection 
requests (ICRs). OIRA will review these ICRs to ensure 
practical utility and to make sure proposals to increase the 
use of technology take into account small business owners who 
may not be tech-savvy.

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